Labor 1 Midterms Reviewer

Labor Midterms Reviewer UP Law Block B2015
I. Introduction to Labor Law LABOR: Concept a. in its general sense b. In its

technical sense - Labor Code, Art. 13 (a) LABOR LAW: a. Definition b. 1.
Justification: Social Justice Case Summary Tirazona v. Phil The right of the
accused to be present at the arraignment assures that he is EDS Technofully
acquainted with the nature of the crime imputed against him and the Service Inc.
circumstances of which it is allegedly committed. It is a vital aspect of the
(2009) constitutional rights guaranteed him. Violation of which, is of such gravity
as to nullify the whole proceeding. Ha Yuan Restaurant v. NLRC (2006) Juvy Soria
assaulted her co-worker at SM Food Court. Due to the altercation that followed, she
and her co-worker were banned from working at SM Food Court. She filed a complaint
before the Labor Arbiter, which was then dismissed. Her appeal to the NLRC met the
same fate, though separation pay was awarded. The CA affirmed.
Doctrine An employee dismissed for just causes under Art. 282 of the Labor Code is
not entitled to separation pay. The exception is when the cause of dismissal is
other than serious misconduct or those reflecting on his moral character, the court
may grant separation pay on the ground of equity Separation pay depends on the
cause of dismissal, and may be accordingly awarded provided that the dismissal does
not fall under either of two circumstances: (1) there was serious misconduct, or
(2) the dismissal reflected on the employees moral character.
2. Foundation or basis: Police Power of the State Case Summary St. Lukes Med.
Center An x-ray technician failed to comply with the Employees Assoc-AFW
certification required by law. She was eventually v. NLRC (2007) dismissed from her
position. The Court ruled that she was validly dismissed.
Doctrine While the right of workers to security of tenure is guaranteed by the

Constitution, its exercise may be reasonably regulated pursuant to the police power
of the State to safeguard health, morals, peace, education, order, safety, and the
general welfare of the people.
3. Ultimate goal: Industrial Peace Case Summary Calalang v. SUMMARY: A ban on

animal-drawn vehicles along Rosario St. and Rizal Williams Avenue in Manila during
certain hours of the day was about to be (1940) implemented for a period of 1 year
from the opening of the Colgante Bridge. Calalang seeks to prohibit its enforcement
claiming that it constitutes an unlawful interference with legitimate business or
trade and abridges the right to personal liberty and freedom of locomotion. SC held
the ban to be a valid exercise of police power prompted by considerations of public
convenience and welfare.
Doctrine The state in order to promote the general welfare may interfere with
personal liberty, with property, and with business and occupations The promotion of
social justice, however, is to be achieved not through a mistaken sympathy towards
any given group. Social justice is neither communism, nor despotism, nor atomism,
nor anarchy, but the humanization of laws and the equalization of social and
economic forces 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
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welfare of all the people, the adoption 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.
4. Management prerogative/state regulation Case Summary Ymbong v. ABSABS-CBN

promulgates a company policy whereby all employees who plan to CBN Broadcasting
campaign for a public officer are required to take an LOA, and all who plan to run
(2012) for elections are to resign. Petitioner ran for elections, lost, and
returned to work for ABS-CBN. ABS-CBN dismissed him after awhile, saying he was
deemed to have resigned from work when he ran for office. He questions the validity
of the policy, and asserts that he was illegally dismissed. Labor Arbiter and NLRC
side with Ymbong, CA and SC side with ABS-CBN. Negros Slashers v. Teng was
terminated from his professional basketball team after Teng (2012) showing
unsportsmanlike conduct after being benched at a game, and then calling in sick and
not attending the game after. 5. Social Justice vis-a-vis Management prerogative 6.
Balancing of Interests Case Summary Hotel Enterprises v. Samahan The hotel
implemented a downsizing scheme due to losses ng mga Manggagawa sa Hyatt that it
has incurred because of local and international (NUWHRAIN) (2009) economic
slowdown. The Union staged a strike after the hotel terminated 48 union member
employees. 3. Classification a. Labor Standards b. Labor Relations c. Welfare
Leqislation 4. Basis a. Economic Basis b. Legal Basis 1. 1987 Constitution Case
Summary PNB v. Cabansag was illegally dismissed by PNB Singapore Cabansag Branch.
She filed a complaint for Illegal Dismissal in the
Doctrine So long as a companys management prerogative are exercised in good faith

for the advancement of the employers interest and not for the purpose of defeating
or circumventing the rights of employees under special laws or valid agreements,
the Court will uphold them. While the employer has the inherent right to discipline
its employees, this prerogative is subject to regulation by the Stte in the
exercise of its police power.
Doctrine The constitution affords full protection to labor but the policy is not to
be blindly followed at the expense of capital. Always, the interests of both sides
must be balanced in the light of the evidence adduced and the peculiar
circumstances surrounding each case
Doctrine Whether employed locally or overseas, all Filipino workers enjoy the
protective mantle of Philippine labor and social legislation, contract stipulations
to the contrary
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(2005)
NLRC. SC found she was illegally dismissed by PNB because there was no notice and
hearing, and theres no valid cause for dismissal.
notwithstanding. This pronouncement is in keeping with the basic public policy of

the State to afford protection to labor, promote full employment, ensure equal work
opportunities regardless of sex, race or creed, and regulate the relations between
workers and employers.
Case Innodata Phil Inc v. QuejadaLopez (2006)
1.a. Right to Security of Tenure Summary Pursuant to their employment contract,

employment of both Natividad and Quejada in Innodata were terminated after 1 year.
Natividad and Quejada were claiming that, under the Labor Code, they are classified
as regular employees, and so they filed a complaint for illegal dismissal and for
damages against Innodata. The LA rendered judgement in favour of Natividad and
Quejada, but the NLRC held that their dismissal were valid. Upon appeal, the CA
characterized them as regular employees and said that the employment contract
circumvented their right to security of tenure. The SC affirmed the CA decision.
Doctrine A contract that misuses a purported fixed-term employment to block the

acquisition of tenure by the employees deserve to be struck down for being contrary
to law, morals, good customs, public order and public policy.
1.b. Right to Humane Conditions of Work Case Summary International School

International School (IS) pays its teachers who are hired from abroad, Alliance of
Educators or foreign-hires, a higher salary than its local-hires, whether the
latter v. Hon. Quisumbing are Filipino or not (most are Filipino, but some are
American). It (2000) justifies this under the dislocation factor that
foreigners must be given a higher salary both to attract them to teach here, and to
compensate them for the significant economic disadvantages involved in coming
here. The Teachers Union cries discrimination. 2. Civil Code Summary Pursuant to
their employment contract, employment of both Natividad and Quejada in Innodata
were terminated after 1 year. Natividad and Quejada were claiming that, under the
Labor Code, they are classified as regular employees, and so they filed a complaint
for illegal dismissal and for damages against Innodata. The LA rendered judgement
in favour of Natividad and Quejada, but the NLRC held that their dismissal were
valid. Upon appeal, the CA characterized them as regular employees and said that
the employment contract circumvented their right to security of tenure. The SC
affirmed the CA decision.
Doctrine Equal pay for equal work is a principal long honored in this jurisdiction,
as it rests on fundamental norms of justice. The Constitution provides that labor
is entitled to humane conditions of work. These conditions are not restricted to
the physical workplace, but include as well the manner by which employers treat
their employees, including differences in salary based on unwarranted
discrimination.
Case Innodata v. QuejadaLopez (2006)
Doctrine Article 1700 of the Civil Code declares: The relations between capital
and labor are not merely contractual. They are so impressed with public interest
that labor contracts must yield to the common good. Therefore, such contracts are
subject to special laws on labor unions, collective bargaining, strikes and
lockouts, closed shop, wages, working conditions, hours of labour and similar
subjects. Since a contract of employment is impressed with public interest,
provisions of written statutes are deemed written into the contract. Hence, the
parties are not at liberty to insulate themselves and their relationships from the
impact of labor laws and regulations by simply contracting with each other. In case
of doubt, the terms of the contract should be construed in favour of labor.
3. Labor Code and Omnibus Rules Implementing the Labor Code 4. International
Conventions, Recommendations
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Case International School Alliance of Educators v. Hon. Quisumbing (2000)
Summary International School (IS) pays its teachers who are hired from abroad, or
foreign-hires, a higher salary than its local-hires, whether the latter are
Filipino or not (most are Filipino, but some are American). It justifies this under
the dislocation factor that foreigners must be given a higher salary both to
attract them to teach here, and to compensate them for the significant economic
disadvantages involved in coming here. The Teachers Union cries discrimination.
Doctrine Equal pay for equal work is a principal long honored in this jurisdiction,
as it rests on fundamental norms of justice. The Constitution provides that labor
is entitled to humane conditions of work. These conditions are not restricted to
the physical workplace, but include as well the manner by which employers treat
their employees, including differences in salary based on unwarranted
discrimination.
5. The Labor Code of the Philippines a. Brief History b. Name of Decree - 1 c. Date
of Effectivity - 2 d. Declaration of Basic Policy - 3 e. Construction in favor of
Labor - 4; Civil Code of the Philippines, Art. 1702 Case Summary Dansart Security
Bagoy filed complaint against Dansart. Dansart used DOLE certifications to prove
Force and Allied that it had complied with payments due Bagoy. Labor Arbiter
decided in favor of Services Co. v. Bagoy Bagoy. NLRC reversed Labor Arbiter. CA
annulled NLRCs decision, reinstated (2010) Labor Arbiters. SC affirmed CA
decision. f. Labor Arbiter's Jurisdiction over labor cases - Art- 217 Summary Labor
Arbiter Del Valle issued a Writ of Execution ordering Sheriff Alemania to satisfy
the order to reinstate Deocariza and to pay her monetary benefits due her. The
Sheriff, in failing to collect cash, levied upon properties of LC Big Mak. RTC
dismissed Dys complaint. The CA granted his appeal and remanded the case. The SC
held that RTC acted within its jurisdiction in saying that the labor arbiter has
jurisdiction over Dy. Petitioner Ana Tamonte and Edilberto Tamonte filed a
complaint for the annulment of the foreclosure proceedings conducted by HSBC. There
was a foreclosure proceeding due to petitioners failure to pay the sum of money
secured by the mortgage. Court held that the pending illegal dismissal case with
the NLRC has nothing to do with their obligation to pay to HSBC.
Doctrine Any doubt arising from the evaluation of evidence between the employer and
employee must be resolved in favor of the employee. The burden of proving payment
of monetary claims rests on the employer.
Case Del Valle Jr. v. Dy (2009)
Doctrine It is a rule that regular courts have no jurisdiction to act on labor

cases or various incidents arising therefrom, including the execution of decisions,
awards or orders. Jurisdiction pertains exclusively to the proper labor official
concerned under the Department of Labor and Employment. The enforcement of loan/
mortgage agreement involves debtorcreditor relations focused on contracts and does
not in any way concern employee relations.
Sps. Tamonte v. HSBC (2011)
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Case Manila Electric Company v. Gal (2012)
g. Technical rules, not binding - 221 Summary Gala was a probationary linesman
employed by Meralco. His employment was terminated due to findings made by Meralco
that he, along with the foremen and other linesmen were allowing one Noberto Llanes
to take electrical supplies from their service trucks. Gala then filed a complaint
for illegal dismissal against Meralco g.i. Liberality in application of rules
Summary Industrial Timber Corporation failed to file a motion for reconsideration
within the reglamentary period in their case before the NLRC. The SC ruled that,
since, according to the Labor Code and NLRC's Rules of Procedure, the object of
such rules was to avoid the delay of administration of justice, the same can
relaxed in the interest of the same substantial justice.
Doctrine The application of technical rules of procedure in labor cases may be

relaxed to serve the demands of substantial justice.
Case Industrical Timber Corp. v. Ababon (2006)
Doctrine The Labor Code, as well as the Rules of Procedure of the NLRC, allows for
liberality in the application of rules in the interest of justice.
Case Santos v. Litton Mills (2011)
g.ii. Substantial compliance with the Rules Summary Ma. Ligaya Santos was dismissed
by her employer Litton Mills for allegedly engaging in unauthorized arrangement
with a buyer. The labor Arbiter and NLRC sustained the legality of her dismissal.
The Court of Appeals dismissed her Petition for Review on Certiorari for
noncompliance with Sec.3, Rule 46, 1997 Rules of Procedure.
Doctrine The Court shall relax the rigid application of the rules to offer full
opportunity for parties to ventilate their causes and defenses in order to promote
rather than frustrate the ends of justice.
h. Rule-making/ Limitation -5 Case Summary Kapisanang Manggagawang Petitioners were

granted a daily wage increase of P1.33 based on their collective bargaining
Pinagyakap v. NLRC and agreement with the company, which was implemented on March
7, 1977 but retroacted to Franklin Baker Co. (1987) January 1, 1977. On May 1,
1977, PD 1123 took effect, which mandated all employers in the private sector to
pay an across-the-board increase of P110 for workers receiving a salary of P50, P90
for workers receiving a salary of P30, and P75 for workers receiving a salary of
P15. Under the rule-making authority granted to the Secretary of Labor, he exempted
a) distressed employers and b) employers who have given a salary increase of at
least P60, in addition to the allowance of P60 earlier mandated by another PD (PD
525). i. Applicability - 6, 276; Constitution, Art. IX-B, Sec. 2 (1) Summary
Mercado, a PNOC-EDC employee, files this complaint for illegal dismissal. PNOC-EDC
avers that the Labor Arbiter and NLRC do not have jurisdiction over the case since,
being a subsidiary of the
Doctrine When the Secretary of Labor is given the authority to make rules, it is
expected that he would not promulgate any rule that contravenes the law.
Case PNOC Energy Devt Corp. v. NLRC (1991)
Doctrine In PNOC-EDC v. Leogardo the court ruled that the doctrine that employees
of GOCCs, whether created by special law or formed as subsidiaries under the
General Corporation law, are governed by the Civil Service Law and not by the

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Philippine National Oil Commission which is a GOCC, they are governed by the Civil
Service Law and not the Labor Code. j. Enforcement and Sanctions
Labor Code, has been supplanted by the 1987 Constitution. As such, GOCCs and their
employees are subject to the Labor Code.
6. Work Relationship a. Definition: Employer and Employee b. Employer-Employee

Relationship 1. Factors/ Tests Case Summary Lirio v. Genovia Genovia was hired by
Cesar Lirio as a studio manager in the latters (2011) recording studio. Later,
Genovia was also hired as a composer and arranger of the album of Lirios daughter.
Lirio refused to give proper compensation of Genovia, and later verbally terminated
the same.
Semblante and Pilar v. CA (2011)
Semblante and Pilar worked as masiador and sentenciador in a cockpit. One day
they were summarily replaced. They filed a complaint for illegal dismissal.
Doctrine 1. The elements to determine the existence of an employment relationship

are: (a) the selection and engagement of the employee; (b) the payment of wages;
(c) the power of dismissal; and (d) the employers power to control the employees
conduct. 2. For an employees dismissal to be valid, (a) the dismissal must be for
a valid cause, and (b) the employee must be afforded due process. 3. Procedural due
process requires the employer to furnish an employee with two written notices
before the latter is dismissed: (1) the notice to apprise the employee of the
particular acts or omissions for which his dismissal is sought, and (2) the notice
informing the employee of his dismissal, to be issued after the employee has been
given reasonable opportunity to answer and to be heard on his defense. There is a
four-fold test of employment: (1) the selection and engagement of the employee; (2)
the payment of wages; (3) the power of dismissal; and (4) the power to control the
employees conduct, which is the most important element.
Case Orozco v. Fifth Division (2008)
1.a. Control test v. Economic reality test Summary Orozco is a columnist in PDIs
Lifestyle section. She was terminated so now she filed a complaint for illegal
dismissal. SC held that, using the control test and the economic reality test,
Orozco is not an employee of PDI but merely an independent contractor. Hence, she
was not illegally dismissed.
Doctrine in determining the existence of employeremployee relationship, 2 tests are

controlling: 1) control test and the 2) economic reality test. In the control test,
the most crucial element is the power to control.
Case Javier v. Fly Ace Corp (2012)
2. Burden of proving employer-employee relationship Summary Doctrine Javier claims

illegal In an illegal dismissal case, the onus probandi rests on the employer to
establish just cause. However, whoever claims dismissal from Fly Ace. entitlement
to the benefits provided by law should establish his/her right thereto, and so the
employee must first prove the employer/employee relationship.
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Case Sarona v. NLRC and Royale Security (2012)
3. Piercing the corporate veil Summary Petitioner appealed the decision of the CA,
which affirmed the decision of the NLRC, which affirmed the decision of the Labor
Arbiter, finding petitioner illegally dismissed, but denying the piercing of the
corporate veil, due to the fact that there is no sufficient evidence to warrant
such action. Petitioner was hired by Sceptre, and then asked to resign by the same
in order for him to be able to apply to Royale. Royale relieved him after more than
1 month of service, which time period was the basis for the award of backwages.
Doctrine The corporate veil is pierced when the corporation is just an alter ego of
a person or of another corporation. This will be done if the veil becomes a shield
for fraud, illegality or inequity. 3 basic areas where this is done: 1) defeat of
public convenience as when the corporate fiction if used as a vehicle for the
evasion of an existing obligation; 2) fraud cases or when the corporate entity is
used to justify a wrong, protect fraud, or defend a crime; 3) alter ego cases,
where a corporation is merely a farce since it is a mere alter ego or business
conduit of a person or another corporation. If reinstatement is not possible, the
computation of backwages should be from the time the employee was terminated until
the finality of the decision, finding the dismissal unlawful
c. Independent Contractor and Labor-only Contractor 1. Trilateral Relationship Case

Summary Philippine Bank of CESI provided the Philippine Bank of Communications with
11 Communications v. messengers, one of whom is Orpidia. After 16 months, Orpidia
was NLRC (1986) terminated because his services were no longer needed by the bank.
Orpidia filed a case for illegal dismissal and failure to pay his 13 th month pay.
The NLRC ordered the reinstatement of Orpidia with payment of back wages and 13th
month pay. The bank raised the decision on certiorari, arguing that there is no
employer-employee relationship between the bank and Orpidia. It argued that CESI is
not involved in labor-contracting (because in such, CESI will only be an agent or
intermediary and the bank the employer). The Court held that it CESI is involved in
labor-contracting. San Miguel Corp v. AMPCO hired Vicente, et al. and assigned them
to SMC. When the said Semillano (2010) employees filed for illegal dismissal, the
determining factor is to find whether AMPCO is indeed their employer and not SMC,
to be such AMPCO must prove to be an independent contractor. The SC ruled that
AMPCO is not an independent contractor.
Doctrine A person engaged in labor-only contracting does not have substantial

capital or investment in the form of tools, machineries, work premises and other
materials, and supplies workers to an employer. In job contracting, the contractor
carries on an independent business and undertakes the contract work on his own
account under his own manner and method.
The test to determine the existence of independent contractorship is whether or not

the one claiming to be an independent contractor has contracted to do the work
according to his own methods and without being subject to the control of the
employer, except only as to the results of the work.
Case Aliviado et al. v.
2. Elements of Labor-only contracting Summary SC rendered a judgment against P&G,

claiming that the Sales and
Doctrine Labor-only contracting shall refer to an arrangement where the
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Procter and Gamble Phil and PROMM-GEM (2011)
Promotions Services (SAPS) is a labor-only contractor. Because the latter is a

labor-only contractor, it is an agent of the real employer, which is P&G. Because
of the employer-employee relationship which existed between P&G and the employees
of SAPS, and because some of the latter were illegally dismissed, P&G was likewise
deemed to be guilty of illegal dismissal. P&G appealed through numerous motions.
contractor or subcontractor merely recruits, supplies or places workers to perform

a job, work or service for a principal, and ANY of the following elements are
present: 1. The contractor or subcontractor does not have substantial capital or
investment which relates to the job, work or service to be performed and the
employees recruited, supplied or placed by such contractor or subcontractor are
performing activities which are directly related to the main business of the
principal; OR 2. [T]he contractor does not exercise the right to control over the
performance of the work of the contractual employee.
d. Registration of contractors 1. Effect of Non-compliance e. Solidary Liability of

Indirect Employer/Direct Employer Case Summary Eparwa Security and Security guards
sued both Eparwa, the contractor, and LDCU, the Janitorial Services v. indirect
employer, for underpayment of salary, legal holiday pay Liceo de Cagayan etc. The
Court held that both are solidarily liable, with the LDCU, University (2006) as
ultimately liable to pay the security guards monetary claims.
Doctrine If the contractor/subcontractor fails to pay the wages of his employees,

the employer shall be jointly and severally liable with his
contractor/subcontractor to the extent of the work performed in the contract as if
the employees were directly employed by him
II. Labor Standards Law 1. Employment Policies, Recruitment and Placement of

Workers, and Agencies References a. Employment Policies b. Employment Agencies b.
1. Private Sector - Agencies and Entities 1.) Parties i. Worker ii. Private
employment agency iii. Private recruitment entity 2.) Recruitment and Placement i.
Local employment ii. Overseas employment 3.) Allowed and Protected Entities i.
Allowed Private Agencies and Entities ii. Prohibited Business Agencies and Entities
ii.1. Travel agencies ii.2. Direct hiring Exceptions
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Case Hornales v. NLRC (2001)
Summary Hornales was sent by JEAC to Singapore and deployed as fisherman in the
vessel owned by Min Fu Fishery Co. On board the vessel, he was subjected to
inhumane work conditions, like inadequate supply of food and water, maltreatment by
the ship captain, and lack of medical attendance. He returned to the Philippines
and filed with the POEA a complaint for non-payment of wages and recovery of
damages. PEOA decided in their favor. NLRC reversed because of the inexistence of
employer-employee relationship. SC reinstated POEA decision.
Doctrine Non-compliance with the POEA Rules and Regulations cannot be a basis in
escaping from liability arising from employeeemployer relationship.
4.) Government Techniques of Regulation - Private Recruitment i. Licensinq a.

Citizenship b. Capitalization c. Validity of license d. Non-transferability e.
Registration fees Case Summary Sagun v. Sunace Sagun filed a complaint against
Sunace for collection of excess placement Intl Management fee defined in Article
34(a) of the Labor Code. She presented as her Services (2011) evidence a promissory
note reflecting excessive fees and testified as to the deductions made by her
foreign employer. On the other hand, Sunace presented an acknowledgment receipt
reflecting collection of an amount authorized by POEA. The Court held that the
pieces of evidence presented by petitioner are not substantial enough to show that
the respondent collected from her more than the allowable placement fee. f. Bonds
g. Placement and documentation fees ii. Workers' Fees/Filing fees/License fees
(Placement fee) iii. Reports/ Employment Information iv. Illegal Recruitment:
Simple/Qualified or Syndicated a. When undertaken by non-licensees, non-holders b.
Prohibited practices Case Summary Stalt-Nielsen Medequillo, a seafarer employed by
Stolt-Nielsen, was made to Transpo Group v. disembark the first vessel he was
assigned to without being given any Medequillo reason therefore. He went back to
Stolt-Nielsens office in Manila, and (2012) they re-assigned him to another
vessel. His documents were processed with the POEA, but Medequillo was never
deployed. When Medequillo filed for illegal dismissal, Stolt Nielsen argued that
they are not liable, as under the POEA Contract, actual deployment of the seafarer
is a suspensive condition for the commencement of employment.
Doctrine In proceedings before administrative and quasi-judicial agencies, the

quantum of evidence required to establish a fact is substantial evidence, or that
level of relevant evidence which a reasonable mind might accept as adequate to
justify a conclusion. The factual findings of quasijudicial agencies, like the
POEA, which have acquired expertise because their jurisdiction is confined to
specific matters, are generally accorded not only respect, but at times even
finality if such findings are supported by substantial evidence.
Doctrine Even before the start of any employer-employee relationship,

contemporaneous with the perfection of the employment contract, is the birth of
certain rights and obligations, the breach of which, may give rise to a cause of
action against the erring party.
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People v. Ocden (2011)
Dolores Ocden recruited more than three people and promised them employment in a
factory in Italy. They gave their passports, pictures and other documents to Ocden,
underwent medical exams and paid placement fees to secure their jobs abroad. They
never reached Italy but instead were brought to Zamboanga on the promise that they
will be brought to Malaysia where their visas will be processed. None of them were
able to work abroad. They all learned that Ocden was not a licensed recruiter from
the office of the POEA in Baguio City. The investigating officer assigned to
examine the complaint regarding illegal recruitment filed against petitioner issued
a closure and seizure order. In pursuant of the said Order, the POEA team went to
the residence of petitioner and seized costumes.
It is not necessary for the prosecution to present a certification that a person is

a non-licensee or non-holder of authority to lawfully engage in the recruitment and
placement of workers. Section 6 of Republic Act No. 8042 enumerates particular acts
which would constitute illegal recruitment "whether committed by any person,
whether a non-licensee, non-holder, licensee or holder of authority."
Salazar v. Achacoso (1990)
Art. 38 is unconstitutional because under the Constitution, only the judge may
issue a warrant of search and seizure
v. Enforcement Powers a. Regulatory Power 1. Suspension or cancellation of

License/Authority b. Rule-making Power c. Visitorial power vi. POEA Standard
Employment Contract a. Construction b. Terms and Conditions 1. Disability benefits
Case Summary Abante v. KJGS Fleet Abante suffered back injuries when he slipped on
board the Management, Manila, vessel while working as a seaman. The company-
designated et al. (2009) physician declared him fit for work. He consulted a second
doctor who gave him grade 6-disability rating. He is claiming disability benefits
from KJGS.
Doctrine While it is the company designated physician who must declare that the
seaman suffered permanent disability during employment, it does not deprive the
seafarer of his right to seek a second opinion which can then be used by the labor
tribunals in awarding disability claims (Seagull Maritime Corporation v. Dee.
vii. Joint and Several Liability of Recr:uitment/placement agency and

principal/employer a. Effect of Termination of Agency Agreement Between Manning
Agent and principal Case Summary Doctrine OSM Shipping Guerrero was hired as master
mariner but was not paid his salary Manning agent is jointly and severally liable
with its principal. The fact that Phil., Inc. v. because the management agreement
and crew agency agreement of OSM petitioner and its principal have already
terminated their agency agreement NLRC (the one who hired him) with (PCASCO) (the
one he worked in) was does not relieve the former of its liability. (Basis: Sec. 1
Rule II of the POEA terminated. SC ruled in favor of Guerrero. Rules and
Regulations and Catan vs. NLRC) viii. Responsibilities of local recruitment
agencies/liability for damages and attys' fees 5.) Jurisdiction i. RTC over
criminal action arising from illegal recruitment
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ii. LA over money claims Case Summary Serrano v. Antonio Serrano, a seafarer, was
employed by Gallant Maritime Sevices Gallant and Marlow Navigation Co. under an
employment contract, for a period of Maritime 1 year. He only served for 2 months
and 7 days, leaving an unexpired Services portion 9 months and 23 days in his
contract. The LA and NLRC held that (2009) he was illegally dismissed, therefore
awarding monetary claims. Such claims included his salary for ONLY 3 months, as
provided for by law. Serrano now assails the constitutionality of the last clause
in Section 10(5) of RA8042, which provides for this 3-month cap. The SC declared
such clause as UNCONSTITUTIONAL. iii. POEA over administrative cases a. Pre-
employment cases b. Disciplinary cases b.2. Public Sector Agencies c. Sanctions
Employment Offices 1.) Local Employment 2.) Overseas Employment 2. Alien Employment
Regulation a. Coverage Exemption Case Summary Almodiel v. Almodiel is a CPA who
left his previous job for a promising career as a Cost NLRC Accounting Manager in
Raytheon Philippines. After a standard cost (1993) accounting system was installed
in the company, pursuant to the directive of its head office in USA, the position
of Almodiel became redundant. He was dismissed on the ground of redundancy. Some of
his functions were performed through computerized forms and some were absorbed by
the Finance Department headed by a resident alien named Ang Tan Chai. Almodiel
filed a complaint for illegal dismissal and one of his arguments was that Ang Tan
Chai is an alien without an employment permit and that he should have been the head
of such department because he is a Filipino.
Doctrine (Our syllabus says that we should just NOTE that the subject clause in
this case was declared UNCONSTITUTIONAL.) The Court concludes that the subject
clause contains a suspect classification in that, in the computation of the
monetary benefits of fixedterm employees 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 other OFWs or local workers with fixed-
term employment. The subject clause singles out one classification of OFWs and
burdens it with a peculiar disadvantage.
Doctrine Requirement of employment permit in Art 40 of the Labor Code refers to

non-resident aliens. The employment permit is required for entry into the country
for employment purposes and issued after determination of nonavailability 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. This
requirement does not apply to resident aliens.
b. Conditions for Grant of Permit Case Summary Pacific Consultants A Canadian

citizen and resident was employed by a Philippine subsidiary of a International
Asia v. Japanese firm. His services were terminated. He later sued with the LA for
Schonfeld (2007) Illegal Dismissal. LA ruled against employee. NLRC affirmed LA. CA
reversed NLRC (and LA.) SC affirmed CA. c. Validity of AEP
Doctrine One of the requirements for the issuance of an employment permit is the
employment contract. Any assertions made therein estop the parties from making
allegations to the contrary.
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d. Revocation/Cancellation, Grounds-Due Process 3. Development of Human Resources
a. Manpower Development - Technical Education & Skills Development of Filipino
Middle-level Manpower 1.) Definition 2.) General Policy 3.) Specific Goals &
Objectives b. Training and Employment of Special Workers - Apprentices and Learners
1.) Policy Objectives 2.) Definition Apprentice-Learner 3.) Allowed Employment and
When 4.) Conditions of Employment 5.) Enforcement c. Persons with disability or
PWDs (formerly referred to as Disabled Persons or "Handicapped Workers", Magna
Carta for Disabled Persons of 1992 (RA 7277), as amended by RA 10070 (April 6,2010)
1.) Definition 2 ) Policy declaration 3.) Coverage 4.) Employment Rights and
privileges Case Summary Doctrine Bernardo v. The employment of
petitioners/complainants, who were deaf mutes and Art. 280 and the Magna Carta for
Disabled Persons seeks to prevent NLRC and employed by the FEBTC through the
Employment Contract for Handicapped the circumvention of the employees right to
be secure in his tenure by FEBTC Workers, were terminated by said Bank.
Respondents opined that they were indiscriminately and completely ruling out the
all written and oral (1999) not regular employees falling under Art. 280 of the
Labor Code hence their agreements inconsistent with the concept of regular
employment dismissal was not illegal. The SC reversed the decision and held that
defined therein. Where an employee has been engaged to perform petitioners were
regular employees of the Bank. activities which are usually necessary or desirable
in the usual business of the employer, such employee is deemed a regular employee
and is entitled to security of tenure notwithstanding the contrary provisions of
his employment contract. Sec. 5 of the Magna Carta for Disabled Persons mandates
that a qualified disabled employee should be given the same terms and conditions of
employment as a qualified able-bodied person. 5.) Discrimination in Employment 6.)
Enforcement 4. Conditions of Employment A. HOURS OF WORK 1. Regulation; Rationale
Case Summary Manila Employees of MTC, both day and night shifts, worked for 12
hours per Terminal Co. day. They demanded overtime pay. MTC argued that if computed
based Inc. v. CIR on minimum wage, the salaries included overtime pay. The CIR and
SC (1952) both held that an employment contract without a fixed hourly rate but has
a payment that if computed based on the minimum wage could cover
Doctrine Employees cannot waive overtime pay. The rationale is that employees are
in such a disadvantageous position as to be naturally reluctant or even
apprehensive in asserting any claim which may cause the employer to devise a way
for exercising his right to terminate employment. The 8 hour labor law also
minimizes unemployment by forcing employers, in case more
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overtime pay does not meet the requirements of the 8 hour labor law.
than 8 hour operations are necessary, to utilize different shifts working only 8
hours each shift.
2. Coverage Exemptions a. Government employees Exception: Employees of GOCCs

created under the Corp. Code - Const. Art. lX-B, Sec.2(1) b. Managerial employees
Case Summary Intl Pharmaceuticals International Pharmaceuticals employed Virginia
Quintia as Medical Director of Inc. v. NLRC (1998) its Research and Development
Department. Their contract was for a term of 1 year. After the 1 year period, the
contract can renewed by the parties. After her contract expired, she remained
employed by the company until she was subsequently dismissed. c. Field Personnel
Summary Mercidar seeks to avoid payment of service incentive leave pay by
classifying its employee (fisherman) as "field personnel." The SC held that the the
employee is not a field personnel since his time and performance at work is
constantly supervised A truck driver employed by Far East was dismissed because of
his complaint for nonpayment of overtime pay. Far East argues that he is not
entitled to overtime pay because he is a field personnel. Court held that the truck
driver is not a field personnel. Thus, he is entitled to overtime pay.
Doctrine In determining whether an employee is a project employee or a regular

employee, the question is whether the employee has been engaged to perform
activities which are usually necessary or desirable in the usual business or trade
of the employer
Case Mercidar Fishing Corp. v. NLRC (1998) Far East Agricultural Supply v.
Lebatique (2007)
Doctrine To determine whether an employee is a field personnel, the question is

whether his time and performance in his work is constantly supervised or not.
Field personnel is not merely concerned with the location where the employee
regularly performs his duties but also with the fact that the employees
performance is unsupervised by the employer. It is also necessary that the employer
can ascertain with reasonable certainty the actual hours of work in the field.
Article 82 of the Labor Code states the coverage of field personnel.
Case Labor Congress v. NLRC (1998)
d. Dependent Family Members e. Domestic Helpers Exemption: Assignment in a

commercial, Industrial or Agricultural Enterprise f. Persons in the Personal
Service of Another g. Piece Workers Definition Summary Doctrine Petitioners,
employees of Empire Foods as They were found to be illegally dismissed. And the
fact that they are piece-workers does not mean that piece-workers, filed a
complaint for ULP, they are not regular employees. Considering their nature of work
which was necessary or desirable in the among others, by way of illegal dismissal.
usual business of Empire Foods, they acquired the status of a regular employee even
if their mode of compensation is that of a piece of worker. As such, they are
entitled to the same benefits as well. The Revised Guidelines on the Implementation
of the 13th Month Pay Law and the Rules and Regulations identify those workers who
fall under the piece-rate category as those who are paid a standard amount for
every piece or unit of work produced that is more or less regularly replicated,
without regard to the time spent in producing the same.
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3. Normal Hours of Work 4. Compensable Hours of Work - ln General a. On duty b. At
work 5. Specific Rules a. Rest period i. Short duration or "coffee break" ii. More
than 20 min. b. Meal period i. Regular Meal Period (One hour) Case Summary Phil
Airlines Fabros, a company surgeon at PAL, went home (5 min. drive) to have his
dinner during his v. NLRC break. A few minutes after he left, one PAL employee had
a heart attack. The nurse of duty (1999) called him and immediately he went back.
The patient arrived at the clinic 7:50 which the nurse brought to the hospital
without waiting for Fabros. Fabros arrived on 7:51 (patient already left.) PAL
suspended Fabros for abandonment of duty.
Doctrine Art. 83(8 hours a day normal work hours a day) and 85(60 min. time off) of
Labor Code. Sec. 7, Rule I, Book III of the Omnibus Rules Implementing the Labor
Code (employer must give employees at least 1 hour time off) The eight-hour work
period does not include the meal break. Nowhere in the law may it be inferred that
employees must take their meals within the company premises. Employees are not
prohibited from going out of the premises as long as they return to their posts on
time.
Case Arica v. NLRC (1989)
ii. Shorter Meal Period (Less than one hour but not less than 20 min.) c. Waiting
time Summary Petitioners sue STANFILCO Philippines for not paying the workers for
their assembly time which takes place 30 minutes prior to start of the workday.
Doctrine A waiting period is not compensable if the employees are not subject to
the absolute control of the company during such period.
d. Working while On Call e. Inactive due to work interruptions Case Summary Univ of
Pangasinan The teachers union of University of Pangasinan is asking for their
Faculty Union v. emergency cost of living allowance (ecola) for the semestral break
period of Univ of Pangasinan school year 1981-1982. University of Pangasinan
refuses to give it to them (1984) claiming that there was no actual service
rendered by the teachers during this period. SC rejects Univ of Pangasinans claim
saying that sembreaks are in the nature of work interruptions beyond employees
control hence employees are entitled to the pay asked.
Doctrine Within the meaning of Omnibus Rules Implement the Labor Code Sec. 4 (d),
sembreak is an interruption beyond petitioners control and it cannot be used
effectively nor gainfully in the employers interest. Hence, sembreak is considered
hours worked that entitles the employees to their regular salaries and ecola.
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Case Rada v. NLRC (1992)
f. Necessary Work after normal hours g Lectures, meeting, trainings h. Travel Time
Summary Rada, who worked as a project driver, claims illegal dismissal and overtime
pay from PhilNor despite his signing of quitclaim.
Doctrine Project employees are those employed in connection with a particular

construction project. Project employees are not entitled to termination pay if they
are terminated as a result of the completion of the project or any phase thereof in
which they are employed, regardless of the number of projects in which they have
been employed by a particular construction company. Moreover, the company is not
required to obtain clearance from the Secretary of Labor in connection with such
termination.
6. Overtime Work/ Pay a. Overtime in ordinary working day b. Emergency or

compulsory overtime work Case Summary Pigcaulan v. Security and Petitioners filed a
case for underpayment and presented listings of the items that Credit Investigation
Inc they claimed were not paid. Likewise, the company presented several payroll
(2012) listings that were supposed to serve as evidence that they were actually
paid.
Doctrine The employer has the burden of proving that it has paid these benefits to
its employees. Even though the LA failed to provide sufficient basis for monetary
awards, it should not result to the prejudice of substantial rights of the party.
c. Undertime work/leave d. Additional compensation 7. Night Work a. Coverage b.

Exclusion ii. Service c. Additional compensation Case Summary Lepanto Consolidated
The Lepanto Mining entered into a CBA with the Lepanto Local Mining Co. v. Lepanto
Local Staff Union providing for night differential and overtime pay for workers.
Sec. 3 mentions that for the 2nd Staff Union (2008) shift (regular shift), no night
differential pay shall be added before the overtime pay is calculated. Lepanto
Mining wants to interpret this as saying that the regular shift is not entitled to
night differential pay. The Labor Arbiter held otherwise. The CA affirmed. The SC
affirms.
Doctrine If the terms of the CBA are clear and have no doubt upon the intention of
the contracting parties, then the literal meaning of its stipulation shall prevail.
B. WEEKLY REST PERIODS 1. Coverage/Exclusions 2. Right to Weekly Rest Period 3.

Determination/Preference of Employee 4. Compulsory work on Rest Day
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5. Premium Pay 6. Work on a Sunday or holiday which is also scheduled Rest Day 7.
CBA on higher premium pay C. HOLIDAYS 1. Coverage/Exclusions Definition a. Retail
Establishment b. Service Establishment Case Summary Mantrade/FMMC Division
Petitioner employees question the validity of the pertinent section of the Rules
and Regulations Employees and Workers Union Implementing the Labor Code as amended
on which respondent arbitrator Froilan M. Bacungan v. Bacungan (1986) based his
decision ruling that Mantrade Devt Corp is not under legal obligation to pay
holiday pay (as provided for in Article 94 of the Labor Code) to its monthly paid
employees who are uniformly paid by the month, irrespective of the number of
working days therein, with a salary of not less than the statutory or established
minimum wage, and that this rule is applicable not only as of March 2, 1976 but as
of November 1, 1974. 2. Regular Holidays/Special Holidays 3. Holiday Pay a. Faculty
in Private School Case Summary Jose Rizal Teachers paid by the hour in JRC are not
paid their holiday pay. The Court ruled that they are not entitled College v. to
pay for regular holidays since they are paid by the hour as per their contract.
However, they are NLRC (1987) entitled to payment of their regular hourly rate for
special public holidays (when regular workday is declared a holiday) and for
cancellations of classes. In case extensions of class days are held to compensate
for the lost hours, they are also entitled to be paid their regular hourly rates.
b. Divisor as Factor Case Summary Trans-Asia Phil TAPEA and Trans-Asia Phils
entered into a CBA stipulating, among others, the provision of Employees Assoc
holiday wage rate (200% of the regular daily wage plus a 60% premium pay). CBA was
to v. NLRC (1999) be effective from April 1, 1988 up to March 31, 1991. TAPEA is
claiming payment of holiday pay arrears (for the period prior to the CBA). Attempt
for amicable settlement failed so TAPEA filed a complaint. Trans-Asia asserted that
the holiday pay was included in their monthly salaries as evident in their
computation of employees benefits and deductions which used 286 as divisor. The
divisor is 286 because it only subtracted the unpaid 52 Sundays and 26 Saturdays
(employees are required to work half-day during Saturdays). Labor-Arbiter dismissed
the complaint. NLRC affirmed the dismissal by the Labor Arbiter. SC affirmed the
decision of NLRC as they were substantially supported by facts and evidence on
record.
Doctrine Under Art. 94 of the Labor Code, monthly salaried employees are not among
those excluded from receiving holiday pay.
Doctrine The purpose of holiday pay is the prevention of diminution of the monthly
income of employees on account of work interruptions.
Doctrine If the 10 legal holidays are not subtracted in the divisor used in the
computation of employees benefits and deduction, then it means that holiday pays
are included in the monthly salaries of employees.
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c. Sunday Case Summary Wellington A Labor Enforcement Officer found nonInvestment
Inc. v. payment of regular holidays falling on a Trajano (1995) Sunday by
Wellington to its employees.
Doctrine The law does not require an employer to make adjustments in the monthly
salary rate to take account of legal holidays falling on Sundays in a given year,
or otherwise to reckon a year at more than 365 days. What the law requires of
employers opting to pay by the month is to assure that the monthly minimum wage
shall not be less than the statutory minimum wage multiplied by 365 days divided by
twelve, and to pay that salary for all days in the month whether worked or not,
and irrespective of the number of working days therein.
Case SMC v. CA (2002)
d. Muslim holiday Summary DOLE Iligan found that there was underpayment of regular
Muslim holiday pay in SMC. It directed SMC to consider Muslim holidays as regular
holidays and to pay both its Muslim and non-Muslim employees holiday pay within 30
days. On appeal, the CA only modified the computation of holiday pay. SC affirmed
CA. 4. Absences 5. Non-working day/sched. Rest day
Doctrine There shall be no distinction between Muslims and non-Muslims as regards

payment of benefit for Muslim holidays. Wages and emoluments are determined on the
basis of the criteria laid down by the laws and certainly not on the basis of the
workers faith or religion.
D. SERVICE INCENTIVE LEAVE 1. Coverage/Exclusions Case Summary Makati Private

respondents worked as tailors, seamstress, sewers, basters and Haberdashery Inc.
plantsadors in Makati Haberdashery. They worked from 9:30 to 6/7 pm v. NLRC
(1989) Mondays to Saturdays and during peak periods even on Sundays and holidays.
SANDIGAN, the labor organization of private respondents filed a complaint for
underpayment of basic wage, living allowance, nonpayment of overtime work, holiday
pay, service incentive pay and 13 month pay, and benefits provided under Wage
Orders Nos. 1-5. Labor Congress v. NLRC (1998) Petitioners, employees of Empire
Foods as piece-workers, filed a complaint for ULP, among others, by way of illegal
dismissal.
Doctrine Private Respondents are not entitled to service incentive leave pay
because as piece rate workers being paid at a fixed amount for performing work
irrespective of time consumed in the performance thereof, they fall under one of
the exceptions stated in Section 1(d), Rule V, Implementing Regulations, Book III,
Labor Code.
They were found to be illegally dismissed. And the fact that they are piece-workers
does not mean that they are not regular employees. Considering their nature of work
which was necessary or desirable in the usual business of Empire Foods, they
acquired the status of a regular employee even if their mode of compensation is
that of a piece of worker. As such, they are entitled to the same benefits as well.
2. Requirements a. Meaning - "at least one year of service" b. Treatment of

benefits
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E. VACATION LEAVE/SICK LEAVE Case Summary PNCC Skyway PNCC Skyway Workers Union is
contesting the scheduling of their Org v. PNCC vacation leave made by PNCC Skyway
Corp. which they say should be Skyway Corp under their discretion. Under their CBA
the scheduling of their vacation (2010) leave shall be under the option of the
employer. SC ruled in favor of Skyway Corp. saying the CBA is clear and leave on
doubt upon the intention of the contracting parties.
Doctrine In the grant of vacation leave privileges to an employee, the employer is

given the leeway to impose conditions on the entitlement to and commutation of the
same, as the grant of vacation leave is not a standard of law, but a prerogative of
management. It is a mere concession or act of grace of the employer and not a
matter of right on the part of the employee. Thus, it is well within the power and
authority of an employer to impose certain conditions, as it deems fit, on the
grant of vacation leaves, such as having the option to schedule the same. Along
that line, since the grant of vacation leave is a prerogative of the employer, the
latter can compel its employees to exhaust all their vacation leave credits. Of
course, any vacation leave credits left unscheduled by the employer, or any
scheduled vacation leave that was not enjoyed by the employee upon the employer's
directive, due to exigencies of the service, must be converted to cash, as provided
in the CBA. Moreover, the vacation leave privilege was not intended to serve as
additional salary, but as a non-monetary benefit. To give the employees the option
not to consume it with the aim of converting it to cash at the end of the year
would defeat the very purpose of vacation leave, which is to afford a laborer a
chance to get a much-needed rest to replenish his worn-out energy and acquire a new
vitality to enable him to efficiently perform his duties, and not merely to give
him additional salary and bounty.
F. PATERNITY LEAVE 1. Coverage 2. Conditions 3. When to avail of benefits 4.

Benefits 5. Treatment of benefit 6. Penalty provisions 7. Employment-related rights
and benefits G. PARENTAL LEAVE -- RA No. 8972 (Solo Parents' Welfare Act of 2000) 1
. Coverage 2. Criteria 3. Qualifications of solo parents 4. Employment-related
rights and benefits a. Flexible Work Schedule b. Work discrimination c. Leave 5.
Treatment of benefit; Non-cumulative
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H. VICTIMS' LEAVE - RA 9262 (An Act Defining violence Against Women and their
Children) 1. Entitlement to leave I. SPECIAL LEAVE BENEFITS FOR WOMEN - RA 9710
(MAGNA CARTA OF WOMEN) 1. Covered employees J. SERVICE CHARGES 1. Covered
establishments 2. Covered employees 3. Sharing 4. Frequency of Distribution 5. Rule
if abolished Case Philippine Hoteliers Inc. v. NUWHRAIN (2009) Summary Wage Order
No. 9 grants ECOLA to particular employees receiving a particular daily wage rate.
NUWHRAIN reported non-compliance of Dusit Hotel with W.O. 9. The DOLE found that
144 employees were to be given the ECOLA. In the meantime, an NLRC decision granted
an increase in the salaries of Dusit employees. Such increase has retroactive
application. Dusit Hotel claims that such increase together with the employees
share in the hotels service charge are sufficient compliance with W.O. 9. CA rules
otherwise. The SC affirmed the CA Decision but with modifications. Doctrine (on
application of salary increase) The increased salaries of the employees should be
used as bases for determining whether they were entitled to ECOLA under WO No. 9.
(on payment of service charge as compliance) Art. 96 of the Labor Code gives the
hotel employees a right to their share in the service charges. The hotel employees
right to their shares in the service charges collected by Dusit Hotel is distinct
and separate from their right to ECOLA.
K. NON DIMUNITION OF BENEFITS Case Summary Metro Bank Patag is a former employer of
Metrobank. He availed of the banks and Trust Co. compulsory retirement plan. He
received retirement benefits v. NLRC and equal to 185% of their gross monthly
salary for every year of Patag (2006) service as provided under the company
Memorandum. After the compulsory retirement, the company and its employees approved
a CBA increasing the benefits to 200% provided that they are employed as of a
certain date. At the specified date, Patag was already retired and therefore, did
not come under the effectivity of the improved benefits.
Doctrine Retired employees can still recover higher benefits because this has been
a company policy. To be considered a company practice, the giving of the benefits
should have been done over a long period of time, and must be shown to have been
consistent and deliberate. The test or rationale of this rule on long practice
requires an indubitable showing that the employer agreed tocontinue giving the
benefits knowing fully well that said employees are not coveredby the law requiring
payment thereof. With regard to the length of time the company practice should have
been exercised to constitute voluntary employer practice which cannot be
unilaterally withdrawn by the employer, jurisprudence has not laid down any hard
and fast rule. To ripen into a company policy, there must be regularity and
deliberateness of the grant of benefits over a significant period of time.
5. Minimum Wages and Wage Fixing Machinery
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A. MINIMUM WAGES 1. General Principles a. Right to a living wage b. No Work, No
pay/A fair day's wage for a fair day's labor Case Summary Sugue v. This case
originates from a complaint filed for constructive dismissal Triumph against
Triumph by Virginia Sugue and Renato Valderrama. Sugue and Intl (2009) Valderrama
were employed by Triumph. They filed a complaint (money claim) with the NLRC
against Triumph. They attended the preliminary conference, during work hours and
they also used the company car. Triumph charged the time spent in attending the
conference to their vacation leave credits. In a later case for constructive
dismissal, Sugue and Valderrama allege that the charging to vacation leave credits
of their time spent in the hearing reeks of bad faith and discrimination on the
part of Triumph. SC disagreed on this point, and eventually decided against Sugue
and Valderrama. Aklan Complainants filed a case for non-payment of backwages
alleging that they Electric Corp were not paid their salaries from June 1992 to
March 1993 when they v. NLRC continued to report for work at the Lezo Aklan (main)
office despite a (2000) resolution from the Board of Directors of AKELCO that the
office was temporarily transferred to Kalibo Aklan. LA dismissed the complaint.
NLRC reversed. SC reversed the NLRC and dismissed the complaint. c. Equal pay for
work of equal value Case Summary Intl School Alliance of International School Inc.
pays 25% more to Educators v. foreign hires than local hires. There was a
Quisumbing (2000) deadlock. The union of local hires wanted equal salary.
Doctrine Where a laborer absents himself from work because of a strike or to attend
a conference or hearing in a case or incident between him and his laborer, his
remedies are to seek reimbursement of wages from his union which declared the
strike or filed the case, or he might have his absence charged against his vacation
leave. A fair days wage for a fair days labor is the principle to follow. If
there is no work performed by the employee there can be no wage or pay. Exception:
If the laborer was able, willing and ready to work but was illegally locked out,
dismissed, or suspended.
The age-old rule governing the relation between labor and capital, or management
and employee of a fair days wage for a fair days labor remains as the basic
factor in determining employees wages. If there is no work performed by the
employee, there can be no wage or pay unless the labor was able, willing and ready
to work but was illegally locked out, suspended or dismissed, or otherwise
illegally prevented from working.
Doctrine Persons who with substantially equal qualifications, skill, effort, and
responsibility, under similar conditions, should be paid similar salaries
regardless of the International character of the school. , if an employer accords
employees the same position and rank, the presumption is that these employees
perform equal work. The burden is on the employer to explain why the employee is
treated unfairly.
Case Arms Taxi v. NLRC (1993)
d. Form: agreement for compensation of services Summary Culla was hired by the
Tanongon spouses to work work for their taxi business. The agreed compensation for
Cullas work was P5000 plus commission on the income of the business and payment of
his SSS premiums. Culla was then dismissed from the job by the Tanongon spouses. He
now prays for reinstatement with backwages, plus his commission of 15% of the gross
income of the taxi business. e. Exemption from income tax
Doctrine A salary is different from a commission. While a salary is a fixed

compensation for regular work or for continuous service rendered over a period of
time, a commission is a percentage or allowance made to a factor or agent for
transacting business for another.
2. Coverage Case Philippine Fisheries Devt Authority v.

Summary Odin Security entered into a contract, the stipulations of which fell short
of the requirements of Wage Order No. 6 then in effect, with Philippine Fisheries,
a GOCC. After two years, representing its guards,
Doctrine The benefits to workers under the Wage Orders are statutory, mandatory,
and
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NLRC (1992)
it filed for collection of the unpaid amounts. The court held that, while a GOCC,
Philippine Fisheries cannot invoke the jurisdiction of the Civil Service
Commission, since it is only a direct employer. It held, however, that since Odin
Security is also at fault for entering into the contract, both are liable for half
of the amount due to the security guards.
cannot be waived. It also covers GOCCs as employers.
3. Minimum Wage a. Determination of compliance with minimum wage Case Summary Iran
v. Employer appeals to the Supreme Court, arguing that commissions NLRC should be
included in determining compliance with the minimum (1998) wage requirement. The
Supreme Court rendered a decision in favor of the employer.
Doctrine Art. 97(f) of the Labor Code explicitly includes commissions as part of
the wages. While commissions are incentives or forms of encouragement to inspire
employees to put industry on the jobs, still these commissions are direct
remunerations for services rendered. Where commissions are equal to or greater than
the minimum wage, the employer need not pay, in addition, the basic minimum pay
prescribed by law. Commissions are included in determining compliance with minimum
wage requirement.
Case Millares v. NLRC and PICOP (1999)
b. Facilities and Supplements/Allowances Summary Petitioners, 116 of them, were

terminated by private respondent Company because it undertook a retrenchment
program as it faced difficulties with the economic crisis and government logging
regulations. They received a separation pay equivalent to 1 month basic pay for
every year of service. Alleging that their allowances (aside from the basic pay)
were received regularly and must form part of the computation for their separation
pay, they filed a complaint for separation pay differentials. The Court affirmed
the findings of the NLRC that these allowances were received on a contingent basis
and may cease on certain conditions and as such, cannot form part of their basic
pay.
SLL Intl Cables Specialist v. NLRC (2011)
SLL International hired Lopez, Canete, and Zuniga on 4 different projects as

project employees. On the 4th project, they left work since they were not allowed
to log in overtime work. They then filed a complaint for illegal dismissal and
underpayment of wages. SLL countered that the food allowance, lodging,
transportation, electricity, water, and snacks allowance should be added to their
basic pay. SC said that these should not be deducted from the wages. But it agreed
that there was no illegal dismissal since they abandoned their work. c. Cash
Wage/Commission Summary Zuellig Inc. terminated Songco, Cipres, and Manuel. The LA
ruled that their separation pay shall include only the monthly salary
Doctrine Employees who were terminated due to retrenchment programs are entitled to
separation pay, which must include the fair and reasonable value, as determined by
the Secretary of Labor, of board, lodging, or other facilities customarily
furnished by the employer to the employee. In the case at bar, the allowances
received by the employees were based on contingencies the occurrence of which
terminates the enjoyment of the said allowances. The term facilities refers to
those articles or serv ices for the benefit of the employee or his family but
excluding tools of the trade or articles or service primarily for the benefit of
the employer or necessary to the conduct of the employers business. In this case,
the transportation allowance and the Bislig allowance were given for the benefit of
the company, which is to insure its employees quality performance. If the benefit
or privilege given to employee constitutes an extra remuneration above and over his
basic or ordinary earning or wage is SUPPLEMENT. If the benefit or privilege is
part of his wages, it is a FACILITY. The distinction lies in the purpose for which
it is given.
Case Songco v. NLRC (1990)
Doctrine Commissions and allowances are included in the computation of monthly

salary for purposes of computing separation pay.
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Boie Takeda v. De La Serna (1993) Phil Duplicators v. NLRC (1995)
exclusive of commission and allowances. They appealed. SC ruled that commission

shall be included in the monthly salary for purposes of computing A consolidated
complaint by Boie-Takeda Chemicals and Phil. Fuji Xerox challenging DOLE decisions
regarding what to include in the computation of thirteenth month pay. Duplicators
filed a second motion for reconsideration claiming that the doctrine in Boie-Takeda
applies to their case as well. SC ruled that they are two different cases.
Remunerations which do not form part of the basic or regular salary of an employee,
such as commissions, should not be considered in the computation of the 13th month
pay. Sales commissions operates as an integral part of a salesmans basic pay hence
it is included in the term basic salary for the purposes of computing their 13th
month pay. Productivity bonuses, however, is something extra and something that the
employer is not compelled to pay to his employees hence it does not fall within the
term basic salary for the computation of 13th month pay.
d. Gratuity and Salary/Wages, Difference Case Summary Plastic Town Center NLM-K
alleges violation of CBA because payment of gratuity pay is Corp. v. NLRC (1989)
equivalent only to 26 days but should actually be equal to 30 days. e. Effect on
Benefits Case Summary Davao Fruits Corp Davao Fruits Corp included in the
computation of 13th month pay v. Associated all the benefits (sick, vacation,
maternity, etc) from 1975 to 1981 Labor Union but discovered that this was an error
pursuant to San Miguel Corp (1993) v Inciong. They decided to remove such benefits
from the computation in 1982, hence ALU filed a complaint.
Doctrine The Civil Code provides that when months are not designated by name, a
month is understood to be thirty (30) days.
Doctrine The considerable length of time the questioned items had been included by
petitioner indicates a unilateral and voluntary act on its part, sufficient in
itself to negate any claim of mistake. A company practice favorable to the
employees had indeed been established and the payments made pursuant thereto,
ripened into benefits enjoyed by them. And any benefit and supplement being enjoyed
by the employees cannot be reduced, diminished, discontinued or eliminated by the
employer, by virtue of Section 10 of the Rules and Regulations Implementing P.D.
No. 851, and Article 100 of the labor code of the Philippines, which prohibit the
diminution or elimination by the employer of the employees' existing benefits
B. WAGE FIXING MACHINERY 1 . Rationale for Wage Rationalization 2. Agencies in Wage

Fixing Machinery a. National Wages and Productivity Commission b. Regional
Tripartite Wages and Productivity Board Case Summary Nasipit RTWPB in Region X
(Northern Mindanao) issued a wage order providing Lumber Co. for a wage increase in
different provinces. A subsequent wage order v. NLRC provides that evn those
receiving above the minimum wage rate are (1998) entitled to the increase. Nasipit
Lumber Company, Inc. (NALCO), Philippine Wallboard Corporation (PWC), and Anakan
Lumber Company (ALCO), claiming to be separate and distinct from each other but for
expediency and practical purposes, jointly filed an application for exemption from
the Wage Orders as distressed establishments under Guidelines No. 3, issued by the
herein Board on November 26, 1990. The Guideline defined distressed
Doctrine The Labor Code, as amended by RA 6727 (the Wage Rationalization Act),
grants the National Wages and Productivity Commission (NWPC) the power to prescribe
rules and guidelines for the determination of appropriate wages in the country.
Hence, guidelines issued by the Regional Tripartite Wages and Productivity Boards
(RTWPB) without the approval of or, worse, contrary to those promulgated by the
NWPC are ineffectual, void and cannot be the source of rights and privileges

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industry as an establishment that is engaged in an industry that is distressed due
to conditions beyond its control as may be determined by the Board in consultation
with DTI and NWPC. RTWPB approved the applicants joint application for
exemption. On appeal, NWPC affirmed ALCOs application but reversed the
applications, NALCO and PWC. Based on the guidelines issued by the NWPC, distressed
establishments are those whose capitalization has not been impaired by 25%. A
perusal of the financial documents on record shows that for the year 1990, which is
the last full accounting period preceding the applications for exemption, appellees
NALCO, ALCO, and PWC incurred a capital impairment of 1.89%, 28.72%, and 5.03%,
respectively. Accordingly, based on the criteria set forth above in the NWPC
Guidelines on Exemption, only the application for exemption of ALCO should be
approved in view of its capital impairment of 28.72%. SC affirmed 3. Standards/
Criteria for Minimum Wage Fixing 4. Wage Order a. Methods of Fixing i. Floor waqe
method ii. Salary - ceiling method Case Summary Employers Confederation With the
authority given by RA 6727 (the Wage Rationalization Act) the of the Phil v.
Natl Wages Regional Board of the National Capital Region, issued Wage Order No.
NCR01-A and Productivity which provides that all workers and employees in the
private sector in the NCR Commission (1991) already receiving wages above the
statutory minimum wage rates up to one hundred and twenty-five pesos (P125.00) per
day shall also receive an increase of seventeen pesos (P17.00) per day. The
Employers Confederation of the Philippines (ECOP) question the validity of this
Wage Order. SC upholds it. b. Validity Case Summary Metrobank v. NWPC RTWPB issued
a Wage Order granting an across-the-board wage increase and Regional Tripartite
which applied to all employees of Region II regardless if they earn beyond Wages
and Productivity the prevailing minimum wage. Metropolitan Bank and Trust Company
Board (2007) sought an exemption from the application of Wage Order since at that
time, it had already been paying its employees more than the prevailing minimum
wage rates in NCR, which is their principal place of business. RTWPB clarified that
the wage orders the Wage Order covers all private establishments situated in Region
II, regardless of the voluntary of the wage orders established in Metro Manila.
Metropolitan Bank filed a petition for certiorari and prohibition seeking the
nullification of the Wage Order. The SC declared the assailed Wage Order void with
respect to its application to employees receiving more than the prevailing minimum
wage rate at the time of the passage of the Wage Order, valid insofar as the
mandated increase applies to employees earning the
Doctrine It is within the authority of the Regional Wages and Productivity Boards
not only to set floor wages, but also to utilize the salary ceiling/cap method. It
is a reasonable policy, and RA 6727 provides reasonable standards for wage-fixing.
Doctrine Although RTWPB is granted authority to fix and determine the minimum wage
rates pursuant to RA 6727, it may only do so using two methods: 1. Floor wage
method fixing a determinate amount to be added to the minimum wage rate. Example:
P15 is to be added to the prevailing minimum wage rate 2. Salary ceiling method
wage adjustment is to be applied to employees receiving a certain denominated
salary ceiling. Workers being paid more than the minimum wage (up to a certain
amount) are also to be given a wage increase Example: Minimum wage is P250.
Everyone earning below it will now earn P250. If the RTWPB does not fix or
determine the minimum wage rate by the two methods enumerated and instead grants an
across-
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prevailing minimum wage rate at the time of the passage of the Wage Order
the-board wage increase, it exceeds its authority by extending the coverage of the
Wage Order to wage earners receiving more than the prevailing minimum wage rate
without a denominated salary ceiling. Diway: In short, RTWPB can only issue wage
orders fixing or determining minimum wage rates. Those earning more than the
minimum wage are beyond the coverage of the wage orders it can issue.
c. Wage Distortion Case Summary Prubankers Assoc Two wage orders were released by
the Regional Tripartite Wages v. Prudential Bank Productivity Boards of Regions V
and VII, calling for a Cost of and Trust Co Living (1999) Allowance (COLA) in
Region V, and an integration of the COLA plus increase in minimum wage in Region
VII. Prudential Bank applied such wage orders to its corresponding branches.
Prubankers assailed this, alleging that this caused the distortion in the wage
rates of its employees nationwide. 5. Freedom to bargain 6. Penalty for
violation/Double lndemnity C. WAGE PAYMENT AND PROTECTION 1. Form of payment Case
Summary Congson v. Workers of Southern Fishing Industry were paid P1 per movement.
The NLRC owner proposed to reduce the rate-per-tuna movement which was opposed
(1995) by the workers, herein respondents. They filed a case against Congson for
constructive dismissal and for collection of monetary benefits based on violation
of the minimum wage law and others. Congson was asserting that the computation of
their minimum wage law should include the monetary value of the tuna liver and
intestines they were receiving. 2. Time of payment Case Summary Gilles v. Gilles
was sent to India for a project. He was not paid his salary, CA (2009) and so he
resigned for that project. Upon his return, he was terminated from the company for
leaving India.
Doctrine Wage distortion presupposes an increase in the compensation of the lower

ranks in an office hierarchy without a corresponding raise for higher-tiered
employees in the same region of the country, resulting in the elimination or the
severe diminution of the distinction between the two groups. Such distortion does
not arise when a wage order gives employees in one branch of a bank higher
compensation than that given to their counterparts in other regions occupying the
same pay scale, who are not covered by said wage order.
Doctrine Article 102 of the Labor Code is clear that wages shall be paid only by
means of legal tender. Petitioner's practice of paying the private respondents the
minimum wage by means of legal tender combined with tuna liver and intestines runs
counter to this of the Labor Code. The fact that said method of paying the minimum
wage was not only agreed upon by both parties in the employment agreement but even
expressly requested by private respondents, does not shield petitioner.
Doctrine Article 103 of the Labor Code mandates that wages shall be paid at least
once every two (2) weeks or twice a month at intervals not exceeding sixteen (16)
days and that no employer shall make payment with less frequency than once a month.
3. Place of payment 4. Person to Pay Case Summary Bermiso v. Escano contracted

stevedoring services exclusively from Sabays group.
Doctrine There is no question that the work of stevedoring was undertaken by the
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Escano, Inc (1959)
Escano has never paid the Sabay group; the practice from the start has been for
Sabay, as leader, to collect charges for handling of the cargo from the shippers or
consignees. The net income from collections, he then distributed to the stevedores.
The SC held that the law on direct payment of wages is not violated.
laborers, not in their individual capacities, but as a group. The contract to

perform the service was made by the leader of the group, for and on behalf of the
latter, not for each and every one of them individually. For the sake of
convenience it was necessary that the group must be large enough to be able to
perform the task of loading and unloading in as short time as possible. As the
group undertook to render service for vessels other than those of the Hijos de F.
Escao, it was absolutely necessary that some sort of leadership be instituted in
the group to determine which of the members will work for one vessel and which for
another. Leadership is also essential to obtain work for the group as employers
naturally prefer to deal with a leader of a group than with each member
individually. Leadership was, therefore, essential not only to secure work for the
group but to arrange the laborers who are to perform the service. The leadership
must be paid for and it was not shown that the head of the groups got the lion's
share of the cost of the service rendered. Under these circumstances the provision
of law on direct payment of wages has been violated.
D. WAGE PROHIBITIONS 1. Prohibition against interference in disposal of wages 2.

Prohibition against wage deduction Case Summary Genesis Juan Taroy was employed by
Genesis Transport as driver on Transport commission basis. After being terminated
due to an accident allegedly Services v. caused by his reckless driving, Taroy
filed a complaint for illegal UMMGT and dismissal against Genesis. In his
complaint, he also alleges that he was Taroy (2010) being underpaid since toll gate
fees were being deducted from his weekly earnings, without his consent. The LA,
NLRC and CA ordered Genesis to refund Taroy for these deductions. The SC affirmed
the same. Nina Jewelry Inc Nina Jewelry is a manufacturing company who employs
goldsmith. v. Montecillo and There were several incidents of theft so the
management wanted to Trinidad (2011) implement a new policy by requiring its
employees to post cash bonds or deposit or to authorize the management to deduct
15% of their weekly salary to answer for any loss which the company might sustain
by reason of the goldsmiths fault or negligence in handling the gold entrusted to
them. As the company convened the employees to discuss about the new policy, two of
its workers no longer reported for work and signified their defiance against the
new policy which was not yet implemented at that point. They filed a complaint for
illegal dismissal. 3. Prohibition against requirement to make deposits for loss or
damage Case Summary Dentech This case concerns a Complaint for Illegal Dismissal
and Violation of PD Manufacturing v. 851 filed by Benjamin, Armando, Juanito, and
Joel. They were welders, NLRC (1989) upholsterers, and painters of Dentech, long
before it became a corporation. They were dismissed in 1985, and filed the
complaint
Doctrine Without the employee's written consent or authorization to the deductions

in his wage, the deduction is considered illegal.
A policy imposing cash bonds or making deductions is generally prohibited, save for
three exceptions in the Labor Code. The enumeration in Art 113 is exclusive. A
company desiring to implement the policy of deposits/ deductions should prove that
it falls under the exceptions or seek determination from the Secretary of Labor
regarding the appropriateness of the adoption of the policy.
Doctrine (Labor Standards; Minimum Wages and Wage Fixing Machinery; Wage
Prohibitions; Prohibition against requirements to make deposits for loss or damage)
Art. 114 of the Labor Code prohibits an employer from requiring his employees to
file a cash bonds or to make deposits. The
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around 4 months later. The LA ruled in their favor. The NLRC affirmed the LAs
decision. The SC affirmed the NLRCs decision. Five J Taxi v. NLRC (1994)
Respondents who were hired by petitioners as taxi drivers were required to pay the
daily "boundary" of P700.00 for air-conditioned taxi or P450.00 for non-air-
conditioned taxi, and P20.00 for car washing, and to further make a P15.00 deposit
to answer for any deficiency in their "boundary," for every actual working day.
Respondents services were eventually terminated so they filed a complaint for
illegal dismissal and illegal deductions. They sought to recover their accumulated
deposits, car wash payments and attorneys fees. The LA dismissed the complaint.
The NLRC affirmed and ruled that they must be paid those which they sought to
recover. The SC modified, holding that they were only entitled to recover their
accumulated deposits.
exception is when the employer is engaged in such trades, occupations or business

where the practice of making deductions or requiring deposits is a recognized one,
or is necessary or desirable as determined by the Secretary of Labor in appropriate
rules and regulations. Art. 114 of the Labor Code provides the rule on deposits for
loss or damage to tools, materials or equipment supplied by employer. It does not
apply to or permit deposits to defray any deficiency which the taxi driver may
incur in the remittance of his boundary.
Case SHS v. Diaz (2010)
4. Prohibition against withholding of wages Summary Manuel allegedly did not work
for 15 days so SHS withheld his salary pending determination if he did work. Manuel
resigned and asked for payment of the salary. SHS still withheld pending return of
alleged office materials possessed by Manuel.
Doctrine Withholding salaries is not within the management prerogatives of

employers because it violates Art. 116 of the labor code and is not within the
exceptions in the form of wage deductions under Art. 113 of the labor code
5. Prohibition against deduction to ensure employment 6. Prohibition against

retaliatory measures 7 . Prohibition against false reporting 8. Prohibition against
keeping of employee's records in a place other than the workplace Case Summary
Doctrine South Motorists Complaints for non-payment of emergency cost of living
Section 11 of Rule X, Book II of the Omnibus Rules provides that All employment
Enterprises v. allowance were filed by 46 workers against South Motorists. records
of the employees of an employer shall be kept and maintained in or about Tosoc
(1990) During inspection and verification, South Motorists was unable the premises
of the workplace. The premises of a workplace shall be understood to to present its
employment records, alleging that they were mean the main or branch office or
establishment, if any, depending upon where sent to the main office in Manila. the
employees are regularly assigned 9. Prohibition against garnishmenti execution
Case Summary Gaa v. CA A writ of garnishment was issued over the salaries,
commission and remuneration of one who held (1985) a supervisory or managerial
position. She argued that her salaries were exempt from execution under Article
1708, CC. The SC held that the exemption does not apply to her.
Doctrine The use of the terms "laborers" and "wages," in their ordinary
signification, suggest that the exemption only applies to manual laborers.
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E. WORKER PREFERENCE lN THE EVENT OF BANKRUPTCY Case Summary Republic v. In the
voluntary insolvency proceedings of Quality Tobacco Peralta Corporation (the
Insolvent), certain claims of creditors were filed. (1987) These include the
claims for separation pay of the two Unions, the claim of Bureau of Internal
Revenue and Bureau of Customs. The trial court held that the claims of the Unions
for separation pay were to be preferred over the claims of Bureau of Customs and
Bureau of Internal Revenue. 1. 2. DBP v. NLRC (1995) Private respondent Leonor Ang
was employed as the Executive Secretary of Tropical Philippines Wood Industries,
Inc (TPWII). TPWII mortgaged its plant facilities and equipment to DBP and these
facilities and equipment were later foreclosed (probably because they were not able
to pay their debt but was not stated in the case). Although TPWII continued its
operations for some time, they eventually had to cease their operations when DBP
took possession of the foreclosed plant facilities and equipment. Private
respondent Leonor Ang filed a complaint for separation pay, 13th month pay,
vacation and sick leave pay, salaries and allowance against TPWII, its General
Manager, and DBP. The claims for unpaid wages and 13th month pay were later paid by
TPWII and the Labor Arbiter only ruled on the separation pay and vacation and sick
leave pay.
Doctrine The term wages under Art. 110 of the Labor Code is within the scope of
severance pay or termination or separation pay (cited PCIB v. National Mines and
Allied Workers Union). For specific purposes of Art. 110 and in the context of
insolvency, termination or separation pay is part of the remuneration or other
money benefits accruing to employees or workers. Art. 110 of the Labor Code has
modified Art. 2244 of the Civil Code in two respects: Labor Code removed the one
year limitation found in art. 2244 (2) Labor Code moved up the claims for unpaid
wages from second priority to first priority in the order of preference established
in Art. 2244. A declaration of bankruptcy or judicial liquidation is required
before the workers preference may be invoked under Art. 110 of the Labor Code. The
workers preference is not a lien on the property of the insolvent debtor but is
merely a preference in application. It is a method to determine the order in which
the credits should be paid first in the settlement of credits of the insolvent
debtor. However, since the claim of DBP is anchored on a mortgage credit, it may
directly and immediately subject the property upon which it is imposed to the
fulfillment of the obligation for whose security it was constituted.
F. WAGE RECOVERY/JURISDICTION OF DOLE REGIONAL DIRECTOR VIS--VIS LABOR ARBITER

Case Summary Doctrine Balladares et al Petitioners filed a complaint for
underpayment of wages against Peak With the enactment of RA 7730 which amended Art
128(b) LC The Sec. of v. Peak Ventures with the DOLE. The DOLE conducted an
inspection and found Labor or his duly authorizes representatives is now empowered
to hear Ventures Corp proof of labor standard violations. The DOLE Regional
Director awarded and decide, in a summary proceeding, any matter involving the
recovery (2009) the money claims of the petitioners which was affirmed by the Sec.
of of any amount of wages and other monetary claims arising out of Labor on appeal.
Peak Ventures now assails the jurisdiction of the employer-employee relations at
the time of the inspection, EVEN IF THE Regional Director of the case considering
that the money claims of each AMOUNT of the money claim exceeds P5,000, if done in
accordance with petitioner exceeds P5,000. the visitorial powers of the DOLE under
Art. 128. However, if the labor standards case is COVERED BY THE EXCEPTION CLAUSE
of Art. 128(b), then the Regional Director will have to endorse the case to the
Arbitration Branch of the NLRC. In order to divest the Regional Director or his
representatives of this jurisdiction, the following ELEMENTS must be present: 1.
That the employer contests the findings of the labor regulations officer and raises
issues thereon 2. That in order to resolve such issues, there is a need to examine
evidentiary matters

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Metereo et al v. Creative Creatures Inc (2009)
Meteoro and 33 others filed complaints of non-payment of various pays and benefits
against Creative Creatures(CC). DOLE-NCR and Sec. of Labor ruled in favor of
Meteoro et al. CC questions the jurisdiction of DOLE and Sec. of Labor. SC ruled
that DOLE-NCR and Sec. of Labor were divested of their jurisdiction over this case.
3. That such matters are not verifiable in the normal course of inspection The DOLE
Secretary and her authorized representatives, such as the DOLE-NCR Regional
Director, have jurisdiction to enforce compliance with labor standards laws under
the broad visitorial and enforcement powers conferred by Article 128 of the Labor
Code, and expanded by Republic Act (R.A.) No. 7730. The Regional Directors power
to hear and decide the monetary claims of employees is not absolute. The last
sentence of Article 128 (b) of the Labor Code, known as the "exception clause,"
provides an instance when the Regional Director or his representatives may be
divested of jurisdiction over a labor standards case. The so-called "exception
clause" has the following elements, all of which must concur: (a) that the employer
contests the findings of the labor regulations officer and raises issues thereon; -
to contest" means to raise questions as to the amounts complained of or the
absence of violation of labor standards laws; - raising lack of jurisdiction alone
is not the "contest" contemplated by the exception clause. It is necessary that the
employer contest the findings of the labor regulations officer. (b) that in order
to resolve such issues, there is a need to examine evidentiary matters; and (c)
that such matters are not verifiable in the normal course of inspection.
6. Thirteenth Month Pay - Pres. Decree No. 851 a. History of the Law Case Summary
Dentech Mfg This case concerns a Complaint for Illegal Dismissal and Violation of
PD 851 Corp v. filed by Benjamin, Armando, Juanito, and Joel. They were welders,
NLRC upholsterers, and painters of Dentech, long before it became a corporation.
(1989) They were dismissed in 1985, and filed the complaint around 4 months later.
The LA ruled in their favor. The NLRC affirmed the LAs decision. The SC affirmed
the NLRCs decision. b. Coverage Summary Laborers in a steel factory were legally
dismissed for abandonment of work and violation of company policy. Laborers demand
their proportionate 13th month pay for the year.
Doctrine Art. 114 of the Labor Code prohibits an employer from requiring his
employees to file a cash bond or to make deposits. The exception is when the
employer is engaged in such trades, occupations or business where the practice of
making deductions or requiring deposits is a recognized one, or is necessary or
desirable as determined by the Secretary of Labor in appropriate rules and
regulations.
Case Archilles Mfg Corp v. NLRC (1995)
Doctrine The right to 13th month pay is automatically vested in the employee who
worked for at least 1 month during the calendar year. The employee is entitled to
this monetary benefit in proportion to the length of time he worked in the year,
even if he is validly dismissed.
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c. Rationale d. Amount and Date of Payment 1) Basic Wage/Commissions Case Summary
Songco v. NLRC (1990) Petitioners Songco and Manuel are salesmen of Zuellig. They
were terminated on the ground of retrenchment. The issue in this case is about the
computation of their separation pay. Petitioners contend that the sales commissions
should be included in the term wage. Zuellig contends otherwise. SC sides with
petitioners.
Boie Takeda v. De La Serna (1993) Phil Duplicators Inc v. NLRC (1995)
BOEI-TAKEDA and FUJI XEROX petitioned for certiorari against the order by DOLE for
them to compute, as part of the 13th month pay, commissions by their medreps and
salesmen respectively. Phil duplicators wanted to exclude their sales commission
from computation of 13th month pay, pursuant to a subsequent decision of the
Supreme Court
Doctrine in computing for separation pay, the earned sales commissions of salesmen
should be included in the monthly salary. **The topic where this case was assigned
is 13th month pay but 13th month pay was only mentioned in the NLRC decision. The
NLRC said that 13th month pay should not be considered as included in the monthly
salary for computation of separation pay. But since SC said that wages should
have a liberal interpretation, then by analogy I think 13th month pay should be
included in the monthly salary. Commissions are not included in basic wages, and
therefore should not be included in the computation for the 13th month pay. A bonus
is an amount granted and paid ex gratia to the employee; its payment constitutes an
act of enlightened generosity and self-interest on the part of the employer, rather
than as a demandable or enforceable obligation. A bonus is not demandable and
enforceable obligation. It is so when made a part of the wage or salary or
compensation.
Intercontinental Broadcasting Corp v. Panganiban (2007)
Letran Calamba Faculty & Employees Assoc v. NLRC (2008)
Ireneo Panganiban was Assistant General Manager of IBC from May 1986 until his
preventive suspension on Aug. 26, 1988. He resigned from his job on Sept. 2, 1988.
He filed in the RTC of Quezon City a case against the members of the Board of
Administrators (BOA) for nonpayment of his unpaid commission. This case was
dismissed for lack of jurisdiction. In July 1992, he was elected by the BOA as
VicePresident for Marketing. He resigned in April 1993 and filed on July 24, 1996 a
complaint for illegal dismissal, separation pay, retirement benefits, unpaid
commissions, and damages. The CA ordered payment of his unpaid commission worth
P2,521,796.77 and damages and attorneys fees. IBC assails the decision, saying
that the cause of action has already prescribed by July 1992, the date of the
filing of the complaint. The Court held that the money claim has prescribed. In
1992, the Letran Calamba Faculty and Employees Association filed with the NLRC a
complaint against Colegio de San Juan de Letran, Calamba for collection of various
monetary claims due to its members. One of the allegations in the complaint is the
failure on the part of the respondent to include teaching overloads as basis for
the computation of 13th month pay. In 1994, the Association held a strike. The
Labor Arbiter dismissed the Associations money claims,
A money claim has a prescription period based on Art. 291 of the Labor Code. Like
other causes of action, this prescriptive period is subject to interruption based
on Art. 1155 of the Civil Code. Although the commencement of a civil action stops
the running of the statute of limitations, its dismissal or voluntary abandonment
by plaintiff leaves the parties in exactly the same position as though no action
had been commenced at all.
An overload pay, owing to its very nature and definition, may not be considered as
part of a teacher's regular or basic salary, because it is being paid for
additional work performed in excess of the regular teaching load. Therefore, it
cannot be considered when computing the 13th month pay.
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and also dismissed Letrans petition to declare the strike illegal. The NLRC
affirmed theLabor Arbiter on appeal. The CA also affirmed the NLRC. 2) Substitute
Payment Summary Eighteen employees of Framanlis filed a complaint claiming they
were not paid emergency cost of living allowance (ECOLA) minimum wage, 13th month
pay, holiday pay, and service incentive leave pay. The Court ruled in favor of the
employees. The non-monetary benefits they gave to their employees cannot serve as
substitute for their 13th month pay as per Sec 3 of PD 851.
Case Framanlis Farms v. MOLE (1989)
Doctrine Sec 3 of PD 851(Regarding valid substitutes in lieu of 13th month pay):

The term 'its equivalent' as used in paragraph (c) hereof shall include Christmas
bonus, midyear bonus, profit-sharing payments and other cash bonuses amounting to
not less than 1/12 of the basic salary but shall not include cash and stock
dividends, cost of living allowances and all other allowances regularly enjoyed by
the employee, as well as non-monetary benefits. The non-monetary benefits enjoyed
by the employees cannot serve as substitute for the 13th month pay due them.
7. Bonus a. Nature: Case Summary Phil. Duplicators Duplicators filed a second

motion for Inc. v. NLRC reconsideration claiming that the doctrine in Boie(1995)
Takeda applies to their case as well. SC ruled that they are two different cases.
Doctrine Sales commissions operates as an integral part of a salesmans basic pay

hence it is included in the term basic salary for the purposes of computing their
13 th month pay. Productivity bonuses, however, is something extra and something
that the employer is not compelled to pay to his employees hence it does not fall
within the term basic salary for the computation of 13 th month pay.
b. Definition, When Demandable Case Summary Lepanto Ceramics The Lepanto Mining
entered into a CBA with the Lepanto Local Staff Inc v. Lepanto Union providing for
night differential and overtime pay for workers. Ceramics Sec. 3 mentions that for
the 2nd shift (regular shift), no night differential Employees Assoc pay shall be
added before the overtime pay is calculated. Lepanto (2010) Mining wants to
interpret this as saying that the regular shift is not entitled to night
differential pay. The Labor Arbiter held otherwise. The CA affirmed. The SC
affirms. Eastern Telecomm Phil v. Eastern Telecomm Employees Union ETPI has been
granting 14th, 15th and 16th month from 1975 to 2002 or for 27 years. CBA for 2001-
2004 also has a Side Agreement providing for such bonuses. On 2003, it deferred
payment because of the continuing deterioration of companys financial position
which started in the year 2000. It subsequently said that payment of the bonuses
would be subject to availability of funds. ETEU filed a preventive mediation
complaint to determine when the bonus shall be paid. Later, company made a sudden
turnaround in its position by declaring that they will no longer pay the bonuses
until the issue is
Doctrine If the terms of the CBA are clear and have no doubt upon the intention of
the contracting parties, then the literal meaning of its stipulation shall prevail.
A bonus is a gratuity or act of liberality of the giver which the recipient has no
right to demand as a matter of right. The grant of a bonus is basically a
management prerogative which cannot be forced upon the employer who may not be
obliged to assume the onerous burden of granting bonuses or other benefits aside
from the employees basic salaries or wages A bonus, however, becomes a demandable
or enforceable obligation when it is made part of the wage or salary or
compensation of the
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resolved through compulsory arbitration. ETEU posited that by reason of its long
and regular concession, the payment of these monetary benefits had ripened into a
company practice which could no longer be unilaterally withdrawn by ETPI. Also, it
has become a contractual obligation of the company as a result of the CBA Side
Agreement ETPI averred that the subject bonuses were not part of the legally
demandable wage and the grant thereof to its employees was an act of pure gratuity
and generosity on its part, involving the exercise of management prerogative and
always dependent on the financial performance and realization of profits. NLRC
dismissed the complaint. CA reversed BLRC Ruling and held ETPI liable for the 14th,
15th and 16th month bonuses. SC affirmed CA Ruling
employee. Whether or not a bonus forms part of wages depends upon the circumstances
and conditions for its payment. If it is additional compensation which the employer
promised and agreed to give without any conditions imposed for its payment, such as
success of business or greater production or output, then it is part of the wage.
But if it is paid only if profits are realized or if a certain level of
productivity is achieved, it cannot be considered part of the wage. Where it is not
payable to all but only to some employees and only when their labor becomes more
efficient or more productive, it is only an inducement for efficiency, a prize
therefore, not a part of the wage.( Metro Transit Organization, Inc. v. NLRC) When
the act of granting the bonuses has become an established company practice, such
has virtually become part of the employees salary or wage. A bonus may be granted
on equitable consideration when the giving of such bonus has been the companys
long and regular practice. To be considered a regular practice, however, the
giving of the bonus should have been done over a long period of time, and must be
shown to have been consistent and deliberate. The test or rationale of this rule on
long practice requires an indubitable showing that the employer agreed to continue
giving the benefits knowing fully well that said employees are not covered by the
law requiring payment thereof. (Philippine Appliance Corporation v. CA)
8. Working Conditions for Special Group of Workers A. WOMEN 1. Women under the
Constitution Case Summary Phil Telegraph De Guzman was illegally dismissed for
allegedly concealing her and Telephone civil status (shes married but wrote in the
application form that Co v. NLRC shes single). PT&T said that this is a violation
of company (1997) policies. SC held that she had been discriminated on account of
her having contracted marriage.
Doctrine Decreed in the Bible itself is the universal norm that women should be
regarded with love and respect but, through the ages, men have responded to that
injunction with indifference, on the hubristic conceit that women constitute the
inferior sex. Nowhere has that prejudice against womankind been so pervasive as in
the field of labor, especially on the matter of equal employment opportunities and
standards. In the Philippine setting, women have traditionally been considered as
falling within the vulnerable groups or types of workers who must be safeguarded
with preventive and remedial social legislation against discriminatory and
exploitative practices in hiring, training, benefits, promotion and retention. The
Constitution, cognizant of the disparity in rights between men and women in almost
all phases of social and political life, provides a gamut of protective provisions.
To cite a few of the primordial ones, Section 14, Article II[8] on the Declaration
of Principles and State Policies, expressly recognizes the role of women in nation-
building and commands the State to
B2015
Prof. P. Daway
Page 31
ensure, at all times, the fundamental equality before the law of women and men.
Corollary thereto, Section 3 of Article XIII[9] (the progenitor whereof dates back
to both the 1935 and 1973 Constitution) pointedly requires the State to afford full
protection to labor and to promote full employment and equality of employment
opportunities for all, including an assurance of entitlement to tenurial security
of all workers. Similarly, Section 14 of Article XIII[10] mandates that the State
shall protect working women through provisions for opportunities that would enable
them to reach their full potential. Article 136 of the Labor Code, one of the
protective laws for women, explicitly prohibits discrimination merely by reason of
marriage of a female employee. It is recognized that company is free to regulate
manpower and employment from hiring to firing, according to their discretion and
best business judgment, except in those cases of unlawful discrimination or those
provided by law. 2. Coverage 3. Equal treatment before the Law 4. Night Work 5.
Prohibited Acts a. Stipulation against Marriage Case Summary Duncan Assoc of Pedro
Tecson wwas employed as a medical representative in Glaxo Detailman v. Wellcome.
Glaxo had a company policy requiring its employees to Glaxo Wellcome disclose to
management any existing or future relationship by (2004) consanguinity or affinity
with employees of competing drug companies. Tecson had a romantic relationship with
Bettsy, an employee of Astra, Glaxo's competitor. They eventually got married.
After reminding him of the company policy and the need to resolve the problem,
Glaxo reassigned Tecson to another sales area. He objected to such transfer and
argued that Glaxo's policy was not valid, and that he was constructively dismissed.
The NCMB and the CA held that the company policy is valid, and that he was not
constructively dismissed. The SC affirmed.
Doctrine Companies like Glaxo have a right to guard its trade secrets,
manufacturing formulas, marketing strategies and other confidential programs and
information from competitors. The prohibition against personal or marital
relationships with employees of competitor companies is reasonable under the
circumstances because relationships of that nature might compromise the interests
of the company. Because the company policy was part of the employment contract,
Pedro was therefore aware of that restriction when he signed his employment
contract and when he entered into a relationship with Bettsy. Since Pedro knowingly
and voluntarily entered into a contract of employment with Glaxo, the stipulations
therein have the force of law between them and, thus, should be complied with in
good faith." He is therefore estopped from questioning said policy.
c. Discharge to prevent enjoyment of benefits d. Discharge on Account of Pregnancy

e. Discharge on Account of Testimony f. Expulsion of Women faculty/female student
due to pregnancy outside of marriage 6. Facilities 7. Special Women Workers 8.
Maternity Leave 9. Sexual Harassment a. Definition
B2015
Prof. P. Daway
Page 32
b. When committed in a work-related/employment environment c. Duty of the employer
Case Summary Phil Aeolus Cortes was dismissed for serious misconduct for doing four
infractions. Automotive Corp She filed a case for illegal dismissal. The SC
declared her dismissal illegal v. NLRC (2000) because although the acts were
disrespectful, it did not constitute a misconduct or improper behavior. The SC also
laid down the requirements for a misconduct to be a just cause for dismissal.
Libres v. NLRC Carlos is an Assistant Manager of the NSC. He was investigated on
the (1999) basis of a charge of sexual harassment as raised by Susan, a secretary
of the Assistant Vice President. After investigation by the AVP, his report was
submitted to the Management Evaluation Committee, which recommended Carlos
suspension based on the report, plant manual, a nd PDI article. Carlos filed a case
for illegal suspension and unjust discrimination with the LA. LA ruled against
Carlos. NLRC affirmed. SC affirmed.
Doctrine For misconduct or improper behavior to be a just cause for dismissal: 1.

It must be serious; 2. Must relate to the performance of the employee's duties;
and, 3. Must show that the employee has become unfit to continue working for the
employer (Sexual Harassment; Duty of the Employer) It is the right, nay, the duty
of every employer to protect its employees from oversexed superiors. Managerial
employees are bound by more exacting work ethics and should live up to a higher
standard of responsibility. Moral perversity against a subordinate is a justifiable
cause for dismissal due to lack of trust and confidence. (Reiterated Villarama.)
B2015
Prof. P. Daway
Page 33

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Labor Midterms Reviewer UP Law Block B2015

I. Introduction to Labor Law LABOR: Concept a. in its general sense b. In its

Doctrine While the right of workers to security of tenure is guaranteed by the

3. Ultimate goal: Industrial Peace Case Summary Calalang v. SUMMARY: A ban on

Labor Midterms Reviewer

4. Management prerogative/state regulation Case Summary Ymbong v. ABSABS-CBN

Doctrine So long as a companys management prerogative are exercised in good faith

Labor Midterms Reviewer

notwithstanding. This pronouncement is in keeping with the basic public policy of

Case Innodata Phil Inc v. QuejadaLopez (2006)

1.a. Right to Security of Tenure Summary Pursuant to their employment contract,

Doctrine A contract that misuses a purported fixed-term employment to block the

1.b. Right to Humane Conditions of Work Case Summary International School

Case Innodata v. QuejadaLopez (2006)

Labor Midterms Reviewer

Case Del Valle Jr. v. Dy (2009)

Doctrine It is a rule that regular courts have no jurisdiction to act on labor

Sps. Tamonte v. HSBC (2011)

Labor Midterms Reviewer

Doctrine The application of technical rules of procedure in labor cases may be

Case Industrical Timber Corp. v. Ababon (2006)

Case Santos v. Litton Mills (2011)

h. Rule-making/ Limitation -5 Case Summary Kapisanang Manggagawang Petitioners were

Case PNOC Energy Devt Corp. v. NLRC (1991)

Labor Midterms Reviewer

6. Work Relationship a. Definition: Employer and Employee b. Employer-Employee

Semblante and Pilar v. CA (2011)

Doctrine 1. The elements to determine the existence of an employment relationship

Case Orozco v. Fifth Division (2008)

Doctrine in determining the existence of employeremployee relationship, 2 tests are

Case Javier v. Fly Ace Corp (2012)

2. Burden of proving employer-employee relationship Summary Doctrine Javier claims

Labor Midterms Reviewer

c. Independent Contractor and Labor-only Contractor 1. Trilateral Relationship Case

Doctrine A person engaged in labor-only contracting does not have substantial

The test to determine the existence of independent contractorship is whether or not

Case Aliviado et al. v.

2. Elements of Labor-only contracting Summary SC rendered a judgment against P&G,

Doctrine Labor-only contracting shall refer to an arrangement where the

Labor Midterms Reviewer

Promotions Services (SAPS) is a labor-only contractor. Because the latter is a

contractor or subcontractor merely recruits, supplies or places workers to perform

d. Registration of contractors 1. Effect of Non-compliance e. Solidary Liability of

Doctrine If the contractor/subcontractor fails to pay the wages of his employees,

II. Labor Standards Law 1. Employment Policies, Recruitment and Placement of

Labor Midterms Reviewer

4.) Government Techniques of Regulation - Private Recruitment i. Licensinq a.

Doctrine In proceedings before administrative and quasi-judicial agencies, the

Doctrine Even before the start of any employer-employee relationship,

Labor Midterms Reviewer

It is not necessary for the prosecution to present a certification that a person is

Salazar v. Achacoso (1990)

v. Enforcement Powers a. Regulatory Power 1. Suspension or cancellation of

vii. Joint and Several Liability of Recr:uitment/placement agency and

Labor Midterms Reviewer

Doctrine Requirement of employment permit in Art 40 of the Labor Code refers to

b. Conditions for Grant of Permit Case Summary Pacific Consultants A Canadian

Labor Midterms Reviewer

Labor Midterms Reviewer

2. Coverage Exemptions a. Government employees Exception: Employees of GOCCs

Doctrine In determining whether an employee is a project employee or a regular

Doctrine To determine whether an employee is a field personnel, the question is

Case Labor Congress v. NLRC (1998)