LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr.

Labor Law Defined It is the law governing the rights and duties of ER and EE [a] with respect to the terms and conditions of employment, and [b] With respect to labor disputes arising from collective bargaining respecting such terms and conditions. 3 branches: 1. Labor standards sets down the minimum terms and conditions for employment; it is a social statement 2. Labor relations provide for the institutional relationship regulations; its objective is that no worker should be become a burden to society; in here the worker is part of the union and the union speaks for the worker 3. Welfare legislation designed to provide for continuity of income *However, in reality it is very difficult to draw the line among these branches. Q: What is the legal implication, if any, of a labor contract? It will become the law between ER and EE; will become binding; there may be economic costs and political repercussions. Q: When will an act ripen into a company practice? When [a] given voluntarily without any compulsion of law; a unilateral act on the part of the ER, and [b] Theres a passage of time, or a time frame Test of Labor Case: [a] presence of ER-EE relationship, [b] Theres a violation of the Labor Code (LC). Other than these, it is not a labor case. LC is the regulatory law; there must be strict interpretation. Management Function or Management Prerogative 1

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. It is the right of the ER to promulgate rules and regulations as are necessary for the efficient management and operation of the establishment. Basis of management function: The Right of Ownership, which is inherent in the rights of the enterprise. BUT, the manner of exercise will be the subject of inquiry: It must be in accordance with law and the principles of fair play. Limitations: a) Law, b) CBA, c) Principles of justice and fair play Compromise and Waiver Periquet v NLRC 1 The law frowns upon waivers and compromise as a general principal because it is subject to abuse 2 But not all C & W are void or contrary to law 3 There is a test to determine the validity of C & W: [a] Voluntarily entered into [b] Proximate equality, no moral ascendancy over the other [c] Amount is reasonable and not unconscionable * Re first statement in Periquet: The law frowns upon waivers: Law recognizes that the situation is not of even or equal terms bet. ER and EE. Principle is grounded on fair play. * Why is there a second statement? Labor law not meant to oppress ERs. 2

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Just as it protects EEs, it also protects ERs. Theres a shared responsibility: EEs right to the fruits of their labor, and Ers rights to the return of their investment. Labor and the Constitution Art. 13 Sec. 3 of 1987 Constitution Protection of labor clause Antamoc case Framers responded to the situation of unrest due to social and economic factors. They adopted the proposition that the State will actively intervene in labor legislation (Welfare State) Q: What is the meaning of the phrase the State affirms labor as primary economic force This means the State recognizes that there is a human factor in production (labor) in contrast to non-human factor (capital). When theres conflict between labor and capital, conflict should be resolved in favor of labor. Calalang v Williams The definition of Social Justice (SJ) is addressed to the worker. What SJ is not, what it is, how it is achieved, how it cannot be achieved. PLDT v NLRC ruling Limitation on the use of Social Justice: SJ not intended to countenance wrongdoing simply because it is committed by the underprivileged. Compassion for the poor is an imperative of every humane society but only when the recipient is not a rascal claiming an undeserved privilege. In sum, 1987 Consti re Labor: 3 provisions: 3

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. [a] Art. 2 re characterization of labor as primary social economic force, [b] Social justice, and [c] Art 13 Sec. 3 Labor protection clause 1 Mantle of legal protection is FULL 2 Its spread, even if EE is not part of any labor union 3 Extended even if EE is not in the Phils. Management and the Constitution [1] The mandate of the Constitution is to protect and promote welfare of EE. But the law protects the worker, only when the worker is right. (PLDT case) [2] Consti not designed to destroy nor oppress ER because ER is also protected by law. Q: How to balance? Labor as Property within Consti meaning: Labor is life itself for the worker. It is not only personal to the worker, because he has a family to recognize. It is livelihood. Therefore, EE should be accorder substantive (Book 6, A282, A283 of LC) and procedural due process (Notice-Hearing-Notice Rule and Ang Tibay case). Participation in Decision-making Process PAL v NLRC EEs right to participation in decision making process is not absolute but qualified. A line has to be drawn between (a) Unilateral decision-making, that is, affecting only capital, and (b) Bilateral decision-making, which is, affecting labor (rights, benefits as provided by law).

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. EEs are entitled to such right to participate ONLY with regard to decision and policy making processes affecting their rights, duties and welfare. Labor and the Civil Code A1700 CC relationship governed by special laws. 2 Important Things: 1 CC characterizes the relationship between labor and mgt. as not merely contractual, but impressed with public interest; that their relationship shall be governed by special laws; and that they should not oppress each other. 2 Labor and mgt, when they relate to each other, should not inconvenience the public

Labor and International Covenants We adopt this by virtue of Art. 2 Sec. 2, the Incorporation Clause of our Consti. Theres an international labor code which consists of the conventions of international labor organizations. This is a special agency of he UN, but its not a supra agency. It cant compel and order member States. Theres a need to ratify. (See International School Alliance of Educators v Quisumbing) Applicability of LC A6, A276 LC, and provisions in Consti Q: Do A6 and A276 LC contradict or complement each other? Q: Does Consti make distinction between EEs performing purely government functions and those who do not? Rule on GOCCs Q: What is the significance of the manner of creation with regard to the law governing GOCCs? LC applies only to GOCCs without original charters and those incorporated in the Corporation Code of the Phils. GOCCs with original charters are governed by the Civil Service law and EO 180.

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. The Law of Creation will always be the test! Note: In terms of wages, LC is applicable to the government, all branches, subdivision and instrumentalities, GOCCs, profit or non-profit organizations. Rule on International Agencies LC does not apply. What applies is the treaty or international agreement. In these treaties or agreements, there is a specific grant of immunity from suit to assure independence in operations. If theres abuse or any injustice created due to this exemption from suit, the remedy of EE is to ask Phils. to withdraw the grant of immunity from suit. Then the legal processes and provisions of law in the Phils will apply. Rule on School Teachers Public School Teachers Civil Service Law applies Private School Teachers on the issue of probationary employment, the Manual f Regulations for Private School issued by the DECS applies and not LC. Labor Code however, is suppletory. Rule on Religious Corporations Ecclesiastical affairs, that is, matters of faith worship and governance of the congregation, are beyond the scope of LC. But, on secular affairs, say termination of work, LC applies and LA and NLRC have jurisdiction (Austria v NLRC)

Rule Making Power The Sec. of DOLE is authorized under law to promulgate rules and regulations to implement LC, BUT, he cannot amend the law under the guise of interpretation. Rules and regulations must always be in accordance with LC. Law Interpretation A4 LC Construction in favor of labor

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Q: Is there a difference in interpreting labor law and labor contracts in CC and LC? Common word: doubt. In CC, worded as in favor of the safety and decency of the living conditions of the worker. In LC, worded as in favor of labor, liberally construed Rules: 1 If theres NO doubt, and the language o the law is clear and unambiguous, theres no room for interpretation 2 If theres DOUBT, then resolve in favor of labor (liberal construction). Theres doubt when the law is susceptible to 2 or more interpretation, both or all of which are correct. Rationale: Abella case to give life and meaning to the compassion and liberal spirit of the law, and to extend its applicability to a greater number of EEs who can avail of the benefits under the law. Q: Should moral reason and equity be also considered? Manning v NLRC case: No. There was positive interpretation of the law, and the judge cannot interject his own views grounded on considerations of equity and social justice. ER-EE Relationship ER one acting in the interest of ER. One need not be owner of enterprise to be considered as ER EE one in the employ of ER (broad in scope) Q: May Company A and worker B agree in a document that there is no ER-EE relationship that will exist between them? NO. ER-EE relationship is not a matter of agreement by the parties, but is determined by law. 7

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. This is to avoid circumvention of the law, and to protect worker from possible abuse by ER. How do we determine ER-EE relationship? 4-fold traditional test 1 Selection and Engagement 2 Payment of Wages 3 Right to Dismiss 4 Control Control for purposes of the test, Control refers to [a] control as to the MEANS, and [b] Control as to the RESULTS. Notes: [1] This is to be distinguished from the control used in Independent Contractor or IC. In IC, control is used not to test ER-EE relationship, but WON theres control (as to the means only) as would warrant a relationship with an IC. [2] One need not actually exercise control, provided the ER reserves the right to control. It also need not be done personally or physically because it may be done through an intermediary (supervisor or manager, etc.) ABS-CBN v Sonza case: Where is the line between control of result only and control of both manner and result? What was the fatal flaw in this case? Had there not been an intermediary (MJDMC), the case would have prospered. What was the materiality of the amount? It was only mentioned to the fact that he had a rare talent. Is amount indicative of ER-EE relationship? No.

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Q: What if control is only a guideline? What is the relationship between control and guideline? Insular Life v NLRC case: Reiterated the control test doctrine but added that not all control is indicative of ER-EE relationship. Control may be used as [a] guideline or [b] Regulation. What saved the insurance company? Yes, all those rules and procedures were there, but they were no actually enforced. Since the insurance business is impressed with public interest, those rules were there in accordance with law. In effect, the guidelines were provided by law and not by the company. Sevilla case: Theres not only one test to determine ER-EE relationship. The 4-Fold Test is the standard test. But in order to avoid mischief because of the harsh application of the 4-fold test, there is the Economic Dependence Test, so ER couldnt circumvent the law. In this test, one may inquire, Is there economic basis? for instance, if EE is enrolled in SSS, then theres ER-EE rel. In sum, 1 Theres not only 1 test in determining ER-EE rel (Sevilla case) 2 Theres the Standard 4-Fold Test: hiring, wages, dismissal and control. Control as to the means and as to the result. Control need not be exercised as long as there is a right reserved to control

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Control as mechanism to control workers method in doing their work Control as guideline (Insular Life case) 3 Theres the Economic Dependence Test (mischief remedy test) 4 Theres no specific rule of evidence to evidence to follow in determining ER-EE rel. For instance, the amount, and the method of payment are not indicative of ER-EE relationship. However, the quantum of proof necessary is only substantial evidence. Independent Contractor v Labor-Only Contractor A106 LC Q: Why does the law validate IC and declares void LOC? [1] LOC is only ideological; it produces only bodies. [2] In IC, not all businesses can do everything or anything; they need specialized help (ICs); this will be convenient also because it will reduce the cost of operations of the business. Standard Test for IC: 1 Nature of Business (separate, independent and distinct) 2 Capital investment (has substantial capital or investment in tools, equipments, machinery or work premises) 3 Control only as to means (hes not under control and supervision of ER or Company) -- In LOC, theres merger of ER and LOC, with ER as the principal and LOC as agent of ER, so that redress of grievances is to the ER. -- In IC, if IC or subcontractor is unable to pay the EEs their wages, then ER is jointly and severally liable. A109 LC refers to solidary liability to any and all violations of the LC. A109 is broad as compared with A106 which is specific in the payment of wages. Note: In the law on wages, the government is included in the coverage of ER. 10

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Government is also liable by virtue of its private contracting. EE Classification A280 LC Test: It is the LAW which determines classification of EE and NOT any agreement bet ER an EE A280 Structure: Regular Except: Project Seasonal Casual Regular Employees A280 Legal Test: [a] Nature of Work EE-centered [b] Nature of Business ER-centered [c] Reasonable Connection Usually Necessary and Desirable Plus, Jurisprudence: This test is viewed as a WHOLE Other Regular EEs Casual employment after 1 year of service whether continuous or broken Probationary EE who is allowed to work even after completion of probi period (A281) Learner who is allowed or suffered work during first 2 months of learner period, if training is terminated by ER before end of stipulated period

*Regular EE is not equal to Permanent EE. In law, theres no such thing as a permanent EE

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Note: An EE may be a regular EE but may also be a project, seasonal or casual EE. The existence of project, seasonal, and casual EEs is a recognition that theres no need for a continuing of the EEs work. Project Employees EE whose employment is fixed on a specific project r undertaking, the completion or termination of which is determined at the time of engagement of EE Law Requirements: [a] LC 1. A280 ER must inform EE of the name and duration of the project. 2. Failure of this is fatal to ER. If ER fails in this obligation imposed by law, then EE becomes a regular EE. [b] Jurisprudence 3. If at the time of engagement the EE is informed, then no matter how long the project is, project employment is valid, EE is project EE. 4. If the project is carefully crafted, EE cannot be converted into regular EE. But if theres continuing need for the project, then EE converted to regular EE. 5. The project and principal business must be separate and distinct from each other. (Associated Labor Union case) 6. There must be no attempt to deny security of tenure to EE Seasonal Employees Work to be performed is seasonal in nature, employment is only for duration of the season. No continuing need for the worker. Manila Hotel v CIR The employment of seasonal workers, at the end of the season, does not cease. They are temporarily laid off during the off season and are not separated from service in said period but are deemed only suspended.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. They are considered on leave until re-employed. The right to be hired is based on 1 season. Casual Employees - They are not defined but are classified by elimination: neither regular project or seasonal. - Conversion Formula (when casual EEs automatically become regular): 1. one year of service whether continuous or broken 2. Regular by automatic operation of law. But this is qualified: (a) Only with respected to the job for which the EE is hired, and (b) Only while the job is existing Fixed Term Employment Brent v Zamora case [a] Fixed term employment is valid. Nothing in the law prohibits fixed term employment, provided, that it does not intend to circumvent the law on tenurial security. [b] 2 Requisites for validity: 1. Entered knowing and voluntarily by the parties without any force duress or improper pressure 2. ER and EE dealt with each other on more or less equal terms with no moral dominance over the other Probationary Employees A281 Structure: period not exceeding 6 months basis of termination: just cause or failure to qualify obligation of ER to lay down conditions or reasonable standards to qualify for regular employment 13

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Note: Apprentice NOT equal to probationary EE Buiser v Leogardo case Despite seeming restrictive provision of the law that probi period is limited to 6 months, parties may agree to extend probi period, provided, a. company policies so declare b. nature of job so requires Test: The nature of the job must have a direct relation to the duration of the probi period. Otherwise, security of tenure is violated. Cardinal Rule in probationary employment: It is NOT the period that matters, it IS the purpose. Mariwasa v Leogardo case The extension of probi period of EE was an act of pure liberality on the part of ER to give EE a second chance to make good after having initially failed to prove his worth as EE. Cebu Stevedoring v Regional Director case In case of absorbed EEs, EEs cannot be considered probi EEs because they were already trained in their respective functions. They were not novices in their jobs but were experienced workers. Theres no such thing as a double probation. Grand Motors case Nothing will prohibit ER from putting EE on probationary. ER has the right to select his employees and also the right to set or fix a probi period within which ER may test and observe conduct of EE before hiring him permanently. working after probi period = regular EE

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. *Disini: Midtown Hotel case in case of an OJT, if period of probi is 6 mos. Only after the 3 months into the OJT that worker was informed that it was a probationary EE. ER cannot now impose another 6 mos., but the 3 mos. OJT was already considered part of the probi period, so, only 3 mos. to go before probationary is completed. After 6 mos., by automatic operation of law absent formal employment, probi becomes regular EE (See Holiday Inn Manila V NLRC case) Holiday Inn case A was on OJT for 3 weeks. After 3 weeks, As services were continued. In effect, A passed probation and qualified as regular EE. Even assuming that probation did not end after 3 weeks of OJT, such period must be included in the 6-month probi period. After 6 months, A is deemed a regular EE by automatic operation of law. Important: ER must inform EE of the reasonable standards re probationary employment. Failure of ER is fatal to him. ER cannot say at the end of 6 months that EE did not qualify. Q: When does EE become regular? Disini: From day 1 Recruitment and Placement of Workers 2 laws involved: a) LC and b) Migrant Workers Act of 1995 (RA 8042) The dividing line between LC and MWA: Place of work, where the worker is going to work, such that: If place of work is Phils, LC applies

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. If place of work is abroad, MWA applies Areas of Concern: 1 How do you regulate the business of Recruitment and Placement (RP) of workers in the private sector? 2 What is illegal recruitment? When is there illegal recruitment? 3 How do you enforce the rights of EE in the event theres a violation? I. R & P in the Private Sector: LC does not deny but allows participation of the private sector in R & P. (A25, LC). Regulatory techniques must be followed: a) Citizenship requirement (A27), b) Capitalization (A28), c) Registration fees (A30), and d) Reporting requirements on employment status (A32). But, Travel Agencies are not allowed to conduct R & P. II. Illegal Recruitment

First Statement: A13(b) of LC same as A6 of MWA. A13(b) Structure consists of 2 parts: 1 Main Part: ACTS: Canvassing, Enlisting, Contracting, Transporting, Utilizing, Hiring, or Procuring workers (C-E-C-T-U-H-P) Also includes: Referrals, Contract services (R-C)

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Acts accompanied by promise or advertising of employment locally or abroad For profit or not (consideration) 2 Proviso: - Any person or entity (actor) - Offers, promises employment (act) - For a fee (consideration) - Employment of 2 or more workers - Deemed engaged in recruitment (effect) Notes: [a] The main part enumerates the Acts of R & P, but is silent as to profit motive and number of workers involved. On the other hand, the proviso mentions number of workers involved (2 or more), and a consideration (for a fee). [b] Relationship of main part and proviso: One can violate the provision of the main part independently of the proviso and vice versa. People v Panis The number of persons dealt with is not an essential ingredient of the act of R & P of workers. Any of the acts mentioned in the basic rule of A13(b) will constitute R & P even if only 1 prospective worker is involved. Second Statement: A34 of the LC refers to Prohibited Acts, which is also incorporated in the MWA, but in A6 of MWA, it adds 2 acts to the enumeration in A34 LC. Third Statement: License and Authority defined the same in both laws.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. *License a document issued by DOLE authorizing a person or entity to operate a private employment agency. A13 (d) of LC *Authority document issued by DOLE authorizing a person or association to engage in a private R & P activities as a private recruitment entity Q: When is there Illegal Recruitment? [a] In LC, when one has NO license or authority and commits any of the acts in A13(b). For there to be a violation of A34 on Prohibited Acts, it is required that the actor has no license also. [b] In MWA, when one has NO license or authority and commits any of the acts in A6 of MWA. For there to be a violation of the Prohibited Acts in the proviso of A6 (in A34 of LC), it does not matter whether or not there is license or authority. III. Enforcing the Rights of EE in case of Violations Determine: * The Place of work to know which law to apply (LC or MWL) * The Acts involved (C-E-C-T-U-H-P or R-C, etc.) * The nature of the offense (Simple, in Large Scale or by a Syndicate) - Illegal Recruitment by a Syndicate when carried out by a group of 3 or more persons conspiring to carry out any unlawful transaction (# of violators involved) - Illegal Recruitment in Large Scale when committed against 3 or more persons individually or as a group (# of workers involved) Notes: [a] In MWA, money claims are within the jurisdiction of the Labor Arbiter, NLRC. [b] The Sec. of Labor has regulatory and visitorial functions (A36 & 37 of LC). But he can no longer order the arrest of violators. HE cannot issue search or arrest warrants, as this must go through the judicial process, since A38par.(c) of LC already deemed unconstitutional. [c] 3 separate informations of illegal recruitment cannot be consolidated in order to charge the offense from simply to large scale or by a syndicate. 18

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Alien Employment See Consti re preferential use of labor. But alien employment is VALID. A40 LC re employment of non-resident aliens; employment permit. Almodiel v NLRC A40 LC which requires employment permit (EP) refers to non-resident aliens. EP is required for entry into the Phils. for employment purposes. The EP is issued by DOLE after a finding by Secretary of non-availability of a person in Phils. who is competent, able and willing at the time of the application to perform the services for which the alien is desired. A40 does not apply to resident aliens. In sum, law requirements: [1] EP, [2] no person in Phils. competent, able and willing to perform the services of the particular job, and [3] such finding is only by Sec. of Labor. Gen. Milling case only Sec. of Labor is authorized to issue EPs. Other agencies power is only recommendatory. Sec of Labors authority to grant and deny EP is broad. Notes: [a] re power of Sec. of Labor in granting or denying EP, other factors are included like economic consideration and considerations of national interest. See A12 LC which states consistent with the national interest. [b] There can be no transfer of employment from one ER to another because EP was granted only for that particular job.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. [c] There must be an understudy program to assure the transfer of technology. Special Class of Workers - Apprentice - Learners - Handicapped *On learners and handicapped workers the intent of the law is that, part of national interest and development is to have a trained manpower. Handicapped Workers Law: RA 7277 Magna Carta for Disabled Persons - These are workers whose earning capacities are impaired, by reason of age, physical or mental infirmity. But these infirmities are not deterrent to gain an employment or livelihood. - Handicapped workers will be treated like a regular worker. Disabled persons have the same rights as other persons to take their proper place in society. - If qualified, handicapped workers may be considered apprentices or for apprenticeship Bernardo v NLRC A qualified disabled EE should be given the same terms and conditions of a qualified able-bodied person. This means that a handicapped EE, if his infirmity does not impair his earning capacity, should be considered and treated like a normal EE. Effect: he should be paid full compensation and not 75%) Learners Law: RA 7796 Sec.4(n) Learners refer to persons hired as trainees in semi-skilled and other industrial occupation w/c are non-apprenticeable.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Learnership programs must be approved by the Authority. Learners may be hired when: 1 No experience workers are available 2 It is necessary to prevent curtailment of employment opportunities 3 Employment does NOT create unfair competition in terms of labor costs or impair lower working standards *Period of Learnership: Not exceeding 3 mos. *Wages: Shall begin at not less than 75% of applicable minimum wage *Deemed Regular: Upon completion of learnership, and when after working for 2 mos, terminated by ER w/o fault of learner, before end of stipulated period. Apprentices Law: RA 7796 Apprentices these refer to persons who undergo training within employment with compulsory related theoretical instructions involving a contract between an apprentice and an ER during a period established assured by an apprenticeable occupation. Sec4(j) RA 7796 * 2 concepts: 1) highly skilled, and 2) only ER can appoint apprentice

*Apprenticeable occupation is an occupation officially endorsed by a tripartite body and approved by Authority. Sec.4(m) RA 7796 *Period of Apprenticeship:

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Not exceeding 6 mos. But may be extended by agreement by the parties *Wages: Shall start at not less than 75% of applicable minimum wage *DOLE factor: Only the DOLE can: 1) Determine if trade or skill is apprenticeable, 2) Determine if enterprise is highly skilled, and 3) Approve the program of apprenticeship Conditions of Employement Hours of Work A82 LC Covered: EEs in all establishments and undertakings, whether for profit or not. (Sir: All EEs in private sector) NOT Covered: Governmentt EEs, Managerial EEs, Field Personnel, Members of ERs family dependent upon for support, Domestic helpers, Persons in personal Service of another, Piece worker Note: If Piece worker earns less than minimum wage, then hes paid the minimum wage 22

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. *Managerial EE primary duty consists of mgt of establishment, includes members of managerial staff *Field Personnel non-agricultural EE who regularly perform duties away from principal place of business and whose actual hours of work in the field cannot be determined with reasonable certainty. Note: The determination of hours of work with reasonable certainty is equated with the degree of supervision (e.g. salesman). Tests: Field Personnel Mercidar v NLRC case Re fishermen, where master of vessel controls fishermen while on boat. Although the fishermen performed non-agri work outside ERs business office, the fact that they are under the effective control or supervision of vessels master did not make them field personnel. (Rule: If under effective control, NOT field personnel) Union of Filipino EEs v Vivar In deciding WON EEs actual working hours in the field can be determined with reasonable certainty, query must be made as to WON such EEs time and performan ce is constantly supervised by ER. Normal Hours of Work The law does not defined a work day but it provides for a normal work day A83 LC In A83, on Normal Hrs of Work: a) Commercial or Industrial EE normal work day is 8 hrs, and normal work week is 6 days b) Health Personnel normal work day is 8 hrs, and normal work week is 5 days Law: Normal work day is 8 hrs within a 24 hour cycle. 23

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Q: What is included? (A84 on Hours Worked) 1 All time EE is required to be at the prescribed work place 2 All time EE required suffered or permitted to work In an 8-hour, normal work day, excluded are [a] Meal period of 60 minutes (PAL v NLRC) except if during the so-called meal break, EE was required to work and not allowed to leave the work place, then it is compensable time (Pan American case). [b] Breaks of short duration not exceeding 20 minutes Idle Time means time when EE is not working or completely at rest, or can leave the work spot, therefore, not compensable time, except if the work is continuous, then it is compensable time Waiting Time Arrica v NLRC case: The 30-minute assembly time was NOT compensable time. Accdg. to SC, such assembly is a routinary practice of EEs, and the proceedings attendant thereto are not infected with complexities so as to deprive EEs time to attend to their personal pursuits. (Sir: This is not good doctrine though) Travel Time The Basic Question to ask in determining WON travel time is compensable is: For whose benefit? In Rada v NLRC, travel time was instituted by the company for its benefit in order to answer the problem of losses connected with the frequent tardiness of EEs. Hence, travel time was compensable time. *Entry Time Cards cannot be considered substantial evidence to determine the number of hours worked. Overtime Work and Offsetting OT (A87 LC) work performed by EE in excess of the regular normal work day (8 hrs) as provided by law and CBA - additional compensation of at least 20-30% of regular wage if on holidays or rest days, holiday pay + at least 30%

PNB case Rationale for OT: 24

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. EE made to work longer than what is commensurate with agreed compensation for the statutory fixed hrs of labor he is supposed to do. It is the additional work, labor or service and the adverse effects of his longer stay in his place of work that justify and is the real reason for the extra compensation called OT. Off-Setting Prohibition A88 LC [1] OT in 1 day cannot be compensated by undertime work on another day and vice versa. [2] Work performed on a holiday cannot be off-set by undertime on another working day. *Why is this so? Factor: Loss of Premium Pay on the part of EE *Rule: OT cannot be waived by EE Built-in OT Package/ Compensation This means that included in the EEs salary is a paid OT worked or not worked. Q: Can you determine the hourly rate of worker? If so, proof of work only requires substantial evidence Engineering Equipment v MOLE case Written contracts with a built-in OT pay in the 10-hour working day, and that the EEs basic monthly pay was adjusted to reflect the higher amount covering the guaranteed 2hour extra time whether worked or unworked are VALID. Q: Can EE be compelled to work OT, considering the issue on involuntary servitude in the Constitution? But, LC provides for exceptions (A89 LC, on emergency OT work): - When theres WAR, national or local emergency declared by Congress or Chief Exec/Pres; When necessary to prevent LOSS of life or property or in case of imminent danger to public safety;

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. When theres URGENT work to be performed on machines, installations etc, to avoid serious loss or damage to ER; When work necessary to prevent loss or damage to PERISHABLE goods; When completion or continuance of work started before the 8th hour is necessary to prevent SERIOUS obstruction or prejudice to ER business

Computation of Additional Compensation (A90 LC): Base formula is regular wage Night Work A86 LC Time frame: 10PM to 6AM, and; at least 10% additional pay for each hour performed from 10PM to 6AM Conditions of Employement Weekly Rest Period This simply means 24 hours of complete and continuous rest after 6 days of normal days of work.(A91 LC) Coverage: A82 LC supra Holidays Every EE is entitled to a paid holiday whenever theres a holiday. EE shall be paid his regular daily wage during regular holidays except in retail and service establishment regularly employing less than 10 EEs. (A94 LC) Intent of the Law: To enable and encourage the workers to contemplate and reflect on the significance of the holiday on the nations history and culture and hopefully, they become better citizens. (The pay benefits the worker, while becoming better citizens is the contemplated benefit to the ER) EO 213 re list of declared regular holidays and special days to be observed throughout the Phils. ER may also require EE to work on any holiday but such EE must be paid 2x his regular rate. Conditions of Employement Service Incentive Leave, PL & ML

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Service Incentive Leave (SIL) Coverage: A95 LC EE who has rendered at least 1 yr shall be entitled to SIL of 5 days with pay. A95 not applicable to EEs already enjoying such benefits

Paternity Leave Law: RA 8187 Male EEs in public and private sectors entitled to PL of 7 days with full pay for the first 4 deliveries of LEGITIMATE spouse with whom hes cohabiting. *2 concepts: 1) Relationship should be LEGIT, and 2) Limited to first 4 deliveries Maternity Leave Law: RA 8282 Sec.14 Female EEs who have paid at least 3 mos. contribution in the 12-month period immediately preceding the term of her childbirth or miscarriage, are entitled to daily maternity benefit equivalent to 100% of her average salary credit for 60 or 78 days. Note: The question of morality is not an issue (miscarriage); the question of birth control is (first 4 deliveries only). Sick Leave and Vacation Leave - Only government EEs entitled to vacation and sick leaves. - No vacation or sick leaves to EEs in the private sector. It should be negotiated by the EEs to the ER. 27

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. - The payment of vacation and sick leaves is governed by ERs policy or agreement between ER and EE Wages 2 preliminary things to consider: 1 Coverage (A97): who are included; government defined as ER re payment of wages 2 A97 (f) Definition of Wage Wage remuneration or earnings capable of being expressed in terms of money whether fixed on a time, task, piece, commission basis or other method of calculating the same, paid to EE, under written or unwritten contract of employment, for work done, to be done or services rendered or to be rendered includes fair and reasonable value (determined by Sec. of Labor) of board, lodging and other facilities customarily furnished by ER to EE

fair and reasonable value shall not include any profit to ER or to any person affiliated with ER fair days pay for a fair days work Facilities v Supplements *Facilities items of expense necessary for the EEs and his familys existence and subsistence and form part of the wage. If furnished by ER, deductible from wage. (e.g board, lodging etc.) *Supplements constitute extra remuneration or special benefits given to or received by EEs over and above their ordinary earnings or wages. Wage v Salary

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Gaa v CA case - Wage and salary are in essence synonymous because they refer to the same meaning: reward or pay for services rendered. - Distinction: Wage applies to compensation for manual labor, and to skilled or unskilled work, while salary denotes a higher degree of employment and applies to high-skilled or highly technical type of job. (Note: This distinction is only artificial. It is only for attachment or garnishment purposes. Wage is too small to be attached or garnished) Gratuity v Wages Gratuity pay is not intended to pay EE for job done but to reward EE for satisfactory or efficient service. It is gratuitous, and as such, is a gift. Payment of Wages Form (A102) Must be through legal tender, NOT by promissory notes, vouchers, tickets, checks etc. But payment of check or money allowed when 1) Manner is customary, 2) Necessary because of special circumstances as specified in regulations issued by DOLE, and 3) stipulated in CBA *Payment of wages by means of legal tender combined with tuna liver and intestines runs counter to LC. (Congson v NLRC) Time (A103) At least once every 2 weeks or 2x a month at intervals not exceeding 16 days. No ER shall make payment with less frequency than once a month. If due to force majeure ER cant pay, payment must be immediately after FM ceased. Place 29

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. - A104 LC At or near place of work, except as otherwise provided by Sec. of Labor - Sec.7 RA 6727 (Wage Rationalization Act) within 1km. radius to a commercial, savings or rural bank within period of payment. - Labor Advisory on Payment of Salaries thru ATM: ER may adopt a system of payment other than in the workplace, as through ATM of banks, provided it meets the conditions imposed. Direct Payment of Wages (A105 LC) Wages must be paid to EE directly to whom they are due except: [a] In cases of force majeure where circumstances make it impossible as determined by Sec of Labor, in w/c case, may be paid to another person under written authroty of EE. [b] If EE has died, ER pays wages to the heirs w/o necessity of intestate proceedings Notes: 1) Sec. of Labor has authority to adjudicate conflicting claims; 2) Payment to Sec. of Labor is exemption from liability. ER relieved from liability when ER deposits amount to DOLE, but limited only to amount deposited; 3) In A106 re wages, solidary liability of ER & IC. Non-Interference (A112 LC) ER cannot interfere on how EE disposes of his wages in ALL circumstances. Also, cannot compel or oblige EE to purchase of merchandise from ER. Wage Deduction 1. A113 LC No ER shall make deductions from EEs wages except: - When EE is insured with his consent by ER, and deduction is to pay ER for amount paid by him for premium on the insurance - For union dues, right of EE or union to check-off has been recognized by ER or authorized in writing by EE concerned. - Where ER authorized by law or regulations issued by Sec. of Labor 30

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. 2. A117 LC deduction to ensure employment is unlawful. Deposits A114 LC No ER shall require EE to make deposits for loss or damage except only 1) When customary in trade, or 2) Sec of Labor provides. However, before ER takes, there must be reasonable explanation *A116 also prohibits withholding of wages and kickbacks. Note that withholding of wages is NOT the same as deducting of wages. Service Charges A96 LC 1 Only limited to certain establishments: Hotels, restaurants, lodging houses, night clubs, cocktail lounge, massage clinics, bars, casinos, gambling houses, including those private subsidiaries of govt, etc. (Q: Does it include a sauna bath?) 2 Theres a sharing agreement between owner and EEs (85% for all covered EEs, and 15% for management) 3 EEs deemed included in the sharing: All EEs regardless of position or rank except managerial EEs Notes: 1) Service charges are different from tips. Service charges are charges for the use of facilities, so theres a sharing agreement while tips are for EEs only, thus no sharing with ER; 2) The moment ER abolishes service charges, ER must integrate in wages the average share of EE in the service charges. This occurs by automatic operation of law.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. 13th Month Pay Whereas Clauses: In PD 851: 1) To further protct the level of real wages from inflation, 2) The Christmas season is an opportune time to show its concern for the plight of the working masses so they may properly celebrate Christmas and New Year Beneficiaries: All Rank and file EEs, provided they have worked for at least 1 month dring a calendar year. When paid: not later the December 24 of every year

Exempted ERs: Government and its political subdivision, and GOCCs except those operating as private subsidiaries of the government ERs already paying their EEs a 13th month pay or its equivalent ERs of household helpers and persons in personal service of another ERs of those who are paid on purely commission, task basis, except where EEs are paid on piece work basis.

Excluded EEs: Government EEs Household helpers Terminated EEs, but may be paid in proportion to the length of time worked during the year.

Bonus The grant of a bonus is a management function and not an obligation. It is not a demandable and enforceable obligation.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. But it becomes demandable and enforceable when it is made part of the wage or salary or compensation of the EE. *Performance bonus theres a criteria; only for those who meet criteria *Across-the-Board bonus all EEs, but sometimes not all actually Wage Recovery see A106 re contractor and subcontractor, also A110 of LC on worker preference during bankruptcy or liquidation. See also A128 on visitorial and enforcement powers, and A129 on recovery of wages, simple money claims and other benefits in connection with A217 re jurisdiction of LA and NLRC. Minimum Wage Fixing This is an integral part of the law. The criteria are provided. Focus of the law: Determining the agencies established for wage fixing machinery, namely: 1 National Wages and Productivity Commission (NWPC) 2 Regional Tripartite Wages and Productivity Board (RTWPB) Tripartite consists of the following: a) ER, b) EE and c) Government NWPC (Commission) [a] Prescribe or set rules and guidelines for the determination of appropriate minimum wages and the factors to be considered [b] Power to review wage levels set by RTWPB; appeal power RTWPB (Board)

[a] Determines and fixed minimum wage rates applicable to region, provinces, industries 33

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. [b] Promulgates the wage order IMPORTANT: The dividing line between NWPC and RTWPB is that the Commission sets the guidelines to be followed, while the Board promulgates the wage orders. Process for Minimum Wage Fixing: 1 There must be a need determined by the board based on its study of pertinent facts 2 Conduct public hearings and consultations 3 Issue wage order (W.O.) 4 Publication of wage order in a newspaper of general circulation. W.O. takes effect 15 days thereafter 5 Appeal to NWPC w/in 10 calendar days; NWPC required to resolve issue w/in 60 days from filing *Effect of Appeal: Appeal will NOT STAY execution of W.O., but if ER posts a surety bond, then execution of WO will stay. *One of the effects of the issuance of a WO is wage distortion (W.D.) Wage Distortion Cause: Implementation of a W.O. which increases prescribed minimum wage Result: Elimination OR Severe Contraction of intentional quantitative wage/ salary rates between or among EEs. (Note: Look at wage and salary program of ER before you can determine if theres W.D. W.D. assumes a hierarchy in position or salary, such that, lower rank, lower salary) How is W.D. resolved? You have to distinguish between: 34

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. 1) Organized establishment meaning, theres a CBA, or a union is recognized as the exclusive bargaining representative 2) Unorganized establishment no CBA, no recognized exclusive bargaining representative even if theres union Different procedures for settlement of each

Organized Establishment: 1 Grievance procedure agreed in CBA 2 Voluntary arbitration (usually a neutral third party resolves it) Unorganized Establishment: 1 ER and EE with aid of National Conciliation Mediation Board (NCMB) through conciliation mediation 2 Compulsory arbitration by NLRC *ER can unilaterally resolve W.D. but ER has no obligation to restore the same differential which existed prior to the W.D. as long as ER restores a differential Notes: 1) W.D. will always be a factual issue. The existence of a W.D. will not stop execution of W.O.; 2) W.D. is localized. It will only apply in a given industry or region and not nationwide; 3) A minimum wage order cannot be less than that prior to the W.O. (A100 LC re rule against diminution or elimination of income or benefits). Q: Can NWPC motu propio review W.O.? The law is silent. Disini: I think the better view is YES. *Policy issue, in relation to A124 LC and the IRR. 35

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Congress has the authority to enact minimum wage but it has opted to follow the wage rationalization law, which favors that of the Board. Women and Minors 1. Women *Consti recognizes the role of women (Art. 2 Sec.14) *3 provisions: 1) Re protection the institution of marriage, 2) Protecting womens pregnancy, and 3) Discrimination provisions on women under certain conditions. 3 Areas of Concern: [a] Institution of marriage A136 provides for stipulation against marriage. When does the law apply? Pre-employment and Post-employment. In case of the pre-employment, does the law apply within the time of pre-hiring or hiring? [b] Law on pregnancy 2 associated laws: Paternity Leave and Maternity Leave [c] Discrimination A135 LC prohibits discrimination against women with respect to terms and conditions of employment solely on account of their sex. There must be equal opportunity, growth, work and pay between male and female EEs Special Women Workers: A138 LC provides for a classification of certain women workers. - Women under certain conditions deemed EEs when they meet the test of the workplace, meaning, when they are permitted or suffered to work in bars, lounges, night clubs and other similar establishments. - Wage is immaterial: with or without compensation

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. - Sec. of Labor should provide rules and regulations re terms and conditions of these women workers Star Paper case No spouse employment policy declared invalid.

2. Minors *Theres recognition in Consti on the role of minors (Art. 2 Sec. 13) *Law: R.A. 7610 Special Protection of Children Against Child Abuse, Exploitation and Discrimination Act 2 Areas of Concern: [a] Minimum Employable Age: 15 years old General. Rule: Below 15 y.o. NOT to be employed Exceptions: 1) When employed by parents of legal guardian, 2) When employment in entertainment is essential, provided that children are protected from any hazardous undertaking, both physical and moral hazards [b] Absolute prohibition on that range: No person shall employ children models in all commercial ads, promoting alcoholic beverages, intoxication drinks, tobacco and its b-products, and violence (Sec.14 RA 7610) Main Requisite before Employment: ER must secure a work permit from DOLE before engaging the child. Sexual Harassment How to measure if 1 act constitutes sexual harassment:

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Guide: [a] Where did it take place? Either work-related environment OR education or training environment [b] Did the actor have moral ascendancy? [c] Medium of exchange: Sexual favor in return for benefits Househelpers A141 LC coverage: All persons rendering services in households for compensation Domestic or Household services shall mean service in ERs home which is usually necessary or desirable for the maintenance and enjoyment thereof and includes ministering to the personal comfort and convenience of the members of ERs household, including services of family drivers. *Househelpers shall not be assigned to non-household work assignment. If suffered to work in a commercial, industrial or agricultural enterprise, he must be paid the prevailing wage or salary of such workers. *Domestic servants or Househelpers are excluded from fringe benefits Legal measure: place of work: ERs home nature of work: For maintenance and enjoyment of ERs home and for personal comfort and convenience of ERs family inclusion of family driver

Homeworkers A153 LC Regulations of industrial homework to be done by DOLE to ensure general welfare and protection of homeworkers *Industrial Homework: 38

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. A system of production under which work for an ER or contractor is carried out by a homework at his/her home. Material may or may not be furnished by ER or contractor.

Termination of Employment *Provisions: a) A282-284, b) A285, c) A277, d) A278-A279 LC *There must be protection to EEs right to Security of Tenure (A279 LC) 3 Things: 1- Termination at the instance of EE 2- Termination at the instance of ER 3- When termination of employment does NOT take place a) The law has a common feature in #1 and #2 above: Termination WITH cause and Termination WITHOUT cause b) In #3, theres NO termination of employment if required by law for a period to perform a civic or military duty. But EE must notify ER after such period of his intent to return on the job. ER will reinstate him without loss of seniority rights (A286 LC) c) Floating status of worker (usually associated with the case of security guards): The period for floating status is 6 months. If it goes beyond 6 months, theres automatically termination of employment.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. However, ER must pay EE separation or termination pay. Termination at the Instance of EE A285 LC WITH Just Cause NO notice required

- EE may terminate employment WITHOUT serving any notice to ER in any of the following just causes: a. Serious insult by ER or his representative of the honor and person of EE b. Inhuman and unbearable treatment by ER or his representative to EE c. Commission of a crime or offense by ER or his rep to EE or any members of his family d. Other analogous causes WITHOUT Just Cause Notice required

- EE may terminate employment without just cause, but must serve notice to ER at least 1 month in advance. Failure to give notice is fatal to EE, because he may be liable for damages Voluntary Resignation act of EE to dissociate himself from employment because he believes that personal reasons cannot be sacrificed in favor of the exigency of the work or service. Requisites: 1) It must be unconditional and with the intent to operate such, 2) Intention to relinquish job, 3) Act of relinquishment Q: Can letter of resignation be withdrawn? A: Yes, until and unless it is not yet accepted by ER. But the moment ER has accepted it, EE cannot withdraw without the consent of ER. Termination at the Instance of ER a) A282, b) A283,

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. c) A284 LC *If EE is illegally terminated A282 immediately comes into the picture. 3 Possible Situations or Choices 1 A282: Just Causes 2 A283: Other Causes or Authorized Causes 3 A284: Disease as Cause Thrust of A282: [a] EEs attitude towards work, [b] Integrity and honesty of worker, [c] Commission of a crime. 2 Things to Remember: What is the qualifying phrase? What is the connective? What are the requirements for each ground?

GROUNDS: (a) Serious misconduct OR willful disobedience by EE of the lawful orders of his ER or representative in connection with his work; (b) Gross AND habitual neglect by the EE of his duties; (c) Fraud OR willful breach by EE of the trust reposed in him by his ER or duly authorized representative; (d) Commission of a crime or offense by EE against the person of his ER or any immediate member of his family or his duly authorized representative; and (e) Other causes analogous to the foregoing. A282(a) Serious Misconduct Misconduct must be serious, meaning, of grave and aggravated character, and not merely trivial and unimportant 41

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Such misconduct must be in connection with EEs work It must show that EE has become unfit to continue working for the ER

Willful Disobedience Act must be willful or intentional, willfulness being characterize by a wrongful and perverse attitude The order violated must be 1) reasonable, 2) Made known to EE, and 3) Must pertain to the duties or work to which he has been engaged to discharge A282(b) Gross and Habitual Neglect of Duties Gross negligence is want or absence of or failure to exercise slight care or diligence, or the entire absence of care Note: It evinces a thoughtless disregard of consequences w/o exerting any effort to avoid them. Simple negligence not a ground It must be habitual Note: Single or isolated act of negligence does not constitute a just cause Must be founded on facts clearly proven by ER Proof is substantial evidence

A282(c) Loss of Confidence Premised on: EE hold a position of trust and confidence

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Note: Position of trust and confidence means EE is entrusted with confidence on delicate matters, or with custody, handling, or care and protection of ERs property. Act complained of must be work-related Must be substantial and founded on clearly established facts

Willful Breach Breach must be willful: Willful means intentionally, knowingly and purposely without justifiable excuse Should be genuine and not simulated Note: Not mere afterthought or subterfuge for causes Must be established by substantial evidence

A282(d) Commission of a Crime or Offense A282 (e) Other Analogous Causes Other Just Causes Claimed by ER Abandonment There must be deliberate and unjustified refusal or failure on the part of EE to resume his employment Clear and unequivocal act that EE has no intention to return to work.

Note: Filing of an action for illegal dismissal negates abandonment. But theres a question of time. Until when? Borrowing Money

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. This act becomes illegal and a ground for termination only if theres moral ascendancy on the part of the borrower

Q: Cradle Snatcher situation. Re teacher and student. Is termination of teacher EE valid or invalid?

A283 LC GROUNDS: (I-R-R-C) (a) Installation of labor-saving devices (b) Redundancy (d) Retrenchment to prevent losses (d) Cessation or Closing of operation of the establishment Additional procedural requirements: 1) Written notice to EE and to DOLE at least a month before, 2) Payment of EE of termination pay. *Fundamental distinction between A282 and A283: In A282, the grounds are attributable to EE. But in A283, the causes are business-related causes and outside the control of the EE Installation of Labor-Saving Devices Disini: This is a question only ER can answer Redundancy Redundancy exists where the services of an EE are in excess of what is reasonably demanded by the actual requirements of the enterprise. In other words, the position is superfluous.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Note: Factors that may result to superfluity of a position: over hiring of EEs, decreased volume of business, or dropping of a specific product line, etc. (Q: are members of the faculty in the College of Law redundant?) Redundancy does NOT necessarily refer to duplication of work. NO requirement of Loss Determination of continuing necessity of a particular position is management function and the courts shall not intervene as long as there is no abuse of discretion or arbitrary malicious action by the ER.

Retrenchment To Prevent Losses Losses must be substantial and NOT merely de minimis Substantial losses apprehended must be reasonably imminent, not necessary actual Retrenchment must be necessary and likely to prevent effectively the expected losses Loss must be proved by substantial evidence. Proof of Loss: Audited financial statement, not just for 1 year but for a series of years. Financial statement must be audited by an independent external auditor It is a measure of last resort (and done in good faith) Sliding income or decreasing gross revenues is not a ground for retrenchment to prevent losses

Notes: 1) Failure to meet these requirements is fatal to ER; 2) Theres no such thing as temporary retrenchment. What is contemplated in A283 is permanent retrenchment to prevent losses. Closure of Business

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. ER may close business even if hes not suffering from serious losses as long as he pays EE termination pay. This is management function. Total or partial closure is allowed The purpose must not be to circumvent the law

A284 LC Disease Nature of disease cannot be cured for a period of 6 months. Continued employment prohibited by law or is prejudicial to EEs health and to the health of his co-EEs EE must be paid separation pay equivalent to at least 1 month salary or to 1/ 2 month salary for every year of service, whichever is greater, a fraction of at least 6 months considered 1 whole year.

Additional requirements: 1) Notice but accompanied by a medical certificate by public physician, 2) No hearing required Due Process Requirements In all termination cases, it is important to ask: 1. Is there compliance with Substantive Due Process (SDP)? 2. Is there compliance with Procedural Due Process? (PDP)? A282-A284 designed to answer the substantive due process question A277 designed to answer procedural due process question SDP Must satisfy the conditions and requirement of A282 to A284 LC PDP Twin Notice Rule and Hearing (notice-hearing-notice) A277(b) In A282, Procedural Requirements: 46

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Two Notice Rule Notice First Notice apprises EE of acts or omissions (causes) for which his dismissal is sought Second Notice informs EE of ERs decision and the reasons to terminate him

*Failure to give either 1 or both of the notices is fatal to the cause of ER *Due Process is personal. It is not enough to just notify the union. Hearing Hearing is required to afford the EE to defend himself Rule: The requirement of hearing need not require a formal or physical hearing. It is sufficient as long as theres ample opportunity for the EE to defend himself. (E.g. submission of position papers is enough to satisfy this requirement Ample Opportunity in due process means that kind of assistance ER must accord EE to enable him to prepare adequately for his defense, including legal representation.

In A283, Procedural Requirements for ER: - Notice to EE and to DOLE, at least 1 month in advance - No hearing required - Payment of separation pay of EEs (Note: basis of termination or separation pay does not include fringe benefits) For Installation of Labor-saving Devices and Redundancy: Separation pay must be at least 1 month pay or to at least 1 month pay for every year of service, whichever is higher. For Retrenchment and Closure of Business: Separation pay must be equivalent to 1 month pay or at least 1/2 month pay for every year of service, whichever is higher.

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. Note: A fraction of at least 6 months is considered 1 whole year. Exception to payment of separation pay: If ER is not in a position to pay because of serious business loss, ER may not pay (North Davao Mining case), OR when business closes because it must comply with law. In A284, Procedural Requirements: Notice required Medical Certification by any authorized public physician Payment of separation pay No hearing is required

Remedial Action A278 and A279 LC *If termination is VALID, then, end of case. But if termination is INVALID, then, remedies and sanctions: Twin Remedy: Reinstatement + full backwages *Failure to pray for these reliefs is NOT fatal to EE. Adjudicating agencies still obligated to award remedies or reliefs. Reinstatement Reinstatement means to restore EE as nearly as to status quo ante Rules: Reinstatement is without loss of seniority rights and other privileges of EE Reinstatement is immediately executory even pending appeal (Pioneer Texturizing Company case) ER has the option between physical reinstatement OR payroll reinstatement. 48

LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. (If EE refuses reinstatement on the payroll but insists on physical reinstatement, EE suffers the consequences) Notes: 1) Prior to Agabon, the term inefficient termination was not existent. So, a VALID and LEGAL termination at that time meant that there was compliance with both SDP and PDP. If there was compliance with SDP but did not comply with PDP, termination was still VALID, but the remedy is only for damages. 2) Serrano later ruled that the remedy was reinstatement + full backwages, if there was compliance with SDP but not PDP; 3) At present, the prevailing doctrine is Agabon, which introduced inefficient / ineffectual termination which meant that there was compliance with SDP but not with PDP. The remedy was not full backwages, but damages. (Disini: Agabon doctrine is divided doctrine.) Full Backwages Backwages means earnings lost by EE due to his illegal dismissal. Full means no deduction whatsoever. This is inclusive of allowances, other benefits, or other monetary equivalent from date of compensation was withheld up to actual reinstatement. The grant of separation pay does NOT preclude award of backwages Same terms and conditions of employment prior to dismissal. Bond cannot stay execution order

*Prescription of action: 4 years from the time of dismissal. (A1146 CC) *Exception to Reinstatement: The Doctrine of Strained Relations Strained Relations

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. - Rule: Theres loss of trust and confidence - Rationale: Its an act of oppression to compel ER and EE to return to status quo ante where there is already loss of trust and confidence between them. - Remedy: In lieu of reinstatement: Separation pay which is the amount EE receives at the time of his severance from service, and is designed to support him financially during the time hes looking for another job. - Caution: This doctrine must be strictly applied. It is not the discretion of ER, for fear of abuse. It is for the Courts to determine WON theres strained relations between ER and EE. In Sum, KEY to understand and approach Termination of Work cases: Q1: Is there a violation of Consti or statutory requirement on the right to Security of Tenure? Guide: a) A278 and b) A279 LC and c) Consti provision in A13 Sec.3 Q2: Is there compliance both in substantive and procedural due process? Guide: a) A282-284 LC for SDP and

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. b) A277 LC for PDP Q3: Is there an act of illegal dismissal? If so, what is the remedy? Guide: 1) Twin remedy is a mandate of the law, even if EE does not pray; 2) Full backwages, meaning, no deductions whatsoever; 3) Rules on Reinstatement; 4) Period of prescription for illegal termination is 4 years from time of dismissal. Retirement Law: A287 on retirement as amended by RA 8558 EE may be retired upon reaching retirement age established in: CBA or other applicable employment contract EE upon retirement entitled to benefits under existing law, CBA or other agreements Theres no law that requires ER to provide a private retirement plan (because of the SSS) General Rule: Above-the-ground EEs, Exception: Underground miners In the absence of retirement plan, retirement age is 60-65 years old and length of service at least 5 years in said establishment

Guide: 1) Age and Length of service,

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LABOR LAW 1 CLASS AND INTEGRATION NOTES Prof. Domingo Disini Jr. 2) Claimant: Above-the-ground or underground? 3) Retirement program NOT a mandatory requirement of the law. Welfare Legislation There is no more presumption of compensability. You have to prove compensability. One common feature: Theres a clear intent on the part of the lawmaker to provide benefits and income, although partial to EEs. Workers should not be a burden to society and to his family. (See Disinis Comapartive Table on this)

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