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NEW ERA UNIVERSITY COLLEGE OF LAW

LABOR LAW REVIEW
Under Atty. Jose-Antonio T. Aliling
1st Semester, AY 2017-2018
Room 308, New Building.

FINALS EXAM

INSTRUCTIONS:

1. Answer in a Blue Book. Write Legibly, double space. If I cannot read your answer, your
answer is wrong;

GOOD LUCK

I.
ARNOLD & Q BAR
(15pts)

Arnold works for Q Bar & Restaurant in Fort. He signed an employment contract on a
contractual basis for 5 months. When his 5 months expires, he is asked to sign a quitclaim
indicating tahat his contract has ended and his employment is severed due to “Endo”. A few
weeks after, the manager of Q Bar & Restaurant hires him again for another 5 months and
assign him to their branch at Quezon City. Same cycle of Endo and making him sign a quitclaim
after 5 months. A few weeks after he is rehired at Q Bar & Restaurant in Fort. After his last 5
months at Q Bar & Restaurant in Fort, he was no longer rehired and he was terminated due to
“Endo” or end of contract. He is paid half month salary as separation pay and made to sign a
quitclaim.

1.1 If you were counsel for Arnold and he comes to you for help, what will be your response
AND explanation to his following questions:
1.1.1 “Atty. am I a regular employee?” Why or Why not. (2 pts.);
1.1.2 “Atty. I want to go back to work at Q Bar & Restaurant Quezon City? Do I
have the right to ask for my job in Q Bar & Restaurant in Quezon City back?”
(2pts)
1.1.3 “If I go back, do I have to return my separation pay?” (2pts)
1.1.4 “What am I entitled to after my Endo?” (2pts)
1.1.5 “If we file with labor, what will the case be?” (2pts)

1.2 If you were lawyer for Q Bar & Restaurant and Arnold sues your client for illegal dismissal,
what will your defense be and what is your advise to your client? (5pts)

II
SAMPLE FORMS
(5pts)

2.1 Draft a probationary employment contract?

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(Employment Contract Probationary)

EMPLOYMENT CONTRACT

Date:

EMPLOYEE:

Address:

Dear __Employee__:

We are pleased to inform you that we are engaging your services as a __Designation__ effective
_____________ with a (daily/monthly) rate of __________________________ (P__________).
The following are the conditions of your employment with this Company:

1. You shall be on probation for a period of six (6) months commencing on your first day of work
with the Company. During your probationary employment, you will be working with us on a trial
basis to determine your fitness for regularization. Your conversion to permanent status shall be
primarily conditioned and dependent upon your satisfactory service and performance of the
work assigned to you and it is within the exclusive discretion of the Company to determine
whether or not such service is satisfactorily performed and on your having successfully passed /
complied with our established standards for regularization which include, among others, the
following criteria: dependability, trustworthiness, efficiency, initiative, attitude towards work/
the public/ the Company, itsofficers and co-employees, cooperation, client response, judgment,
punctuality, quality/ quantity of work, educability, articulateness and professionalism;

2. The Company likewise reserves its rights to terminate your probationary employment, even
prior to the expiration of your probationary period, for any of the just and authorized causes
provided by existing law or for your having failed to satisfactorily meet and comply with the
above-mentioned standards, conditions and requirements. In such event, you will be entitled to
collect only your salary up to the end of working hours of the last day of your actual service;

3.You are required to comply with the all existing rules, regulations and policies of the Company
as well as those which may hereafter be issued, including but not limited to those governing
order and discipline, honesty, safety and security, work assignments and standard operating
procedures, use of Company properties and access to matters of confidentiality, and such other
rules deemed necessary in the conduct of our business;

4.This probationary employment does not entitle you to the benefits that is or may hereafter be
granted only to regular and permanent employees, except those which the Company as a
matter of policy and upon its discretion, extends to all employees regardless of status and to
those provided by law;

5.You agree that all record and documents of the Company and all information pertaining to its
business and/or its affairs and that of its customers are absolutely confidential and unauthorized
disclosure or reproduction of the same will not be made by you at any time during or after your

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employment. You agree that any breach of confidentiality will constitute sufficient ground for
immediate termination of your employment for cause and/or civil and criminal liability;

6.You agree to be assigned to any work or work station or branch of the Company for such
periods as may be determined by the Company and whenever the service requires such
assignments;

7.In case you intend to resign from the Company, you are required to notify the Company at
least thirty (30) days prior to the effectively of your resignation, otherwise, failure on your part
to do so will render you liable for damages. However, it is within the sole discretion of the
Company whether or not to accept such resignation earlier than the expiration of said period.
If you agree with the above terms and conditions, please indicate your conformity by signing on
the space provided below for this purpose.

Very truly yours,

Name of Company
By: General Manager

I HEREBY CERTIFY that I have read and have fully understood the foregoing terms and
conditions of my employment with the Agency and that I accept the same completely.
EMPLOYEE

III.
LEMUEL
(10pts)

Lemuel is a team leader at ABC Call Center. He earns a basic salary of P1,000.00 for an ordinary
work day. Under Lem, he supervises a team of 7 agents. He takes care of these agents and
effectively recommends for their promotion for time to time, and sometimes imposed
disciplinary sanction. One Christmas a virus struck the office and everyone got sick except
Lemuel. Because of this Lemuel took over work for 18 hours, and only ate the whole day for 12
minutes and a half. It was unfortunate for lem because that Christmas day happens to also be
his birthday. Lem worked from 09:30 pm of 24 December 2014 until 18 hours later of 25
December 2014. By the way the President also declared December 24, 2014 a holiday.
Lemuel’s scheduled rest day falls on every Thursday. Lemuel is also a registered Person with
Disability. Compute the following:

3.1 Lemuel’s Basic Pay;

3.2 Lemuel’s Overtime pay for the period covered by the problem;
3.3 Lemuels’ total Night Shift Differential pay for the period covered by the
problem;
3.4 Lemuel’s holiday pay for Dec. 24;
3.5 Lemuel’s total salary plus all the applicable premium on the for the period
covered by the problem;

2 points each.

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IV.
NIGHT WORKERS
(5pts)

4.1 Who are “night workers”?

4.2 Can workers demand a free health assessment before undergoing night work?

4.3 What are the mandatory facilities available for workers performing night work?

4.4 What happens to employees who are unfit for night work?

4.5 Can pregnant women be employed as night workers?

V.

BEN AND MARGIE

(10 pts)

Ben and Margie have been living together for 8 years without the benefit of the
marriage. Ben and Margie have been working at a call center for over 5 years now.
Margie got pregnant and gave birth to twins by way of natural delivery. Ben is the
father. If you were employers of Ben and Margie. What benefits under the law are they
entitled to? How many leaves under the law does Ben have for the year? How many
;eaves does Margie have under the law for the year?

Every married male employee in the private and public sectors shall be entitled to a
paternity leave of seven (7) days with full pay for the first four (4) deliveries of the
legitimate spouse with whom he is cohabiting.1

If i were employer of Margie, the benefits under the law that she is entitled to are Republic Act
1161, as amended by Republic Act 8282.

Under Republic Act 8282, an act further strengthening the social security system
thereby amending for this purpose, republic act no. 1161, as amended, otherwise known as the
social security law, “Every pregnant employee in the private sector, whether married or

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unmarried, is entitled to maternity leave benefit of sixty (60) days in case of normal delivery or
miscarriage, or seventy-eight (78) days, in case of Caesarian section delivery, with benefits
equivalent to one hundred percent (100%) of the average daily salary credit of the employee as
defined under the law. To be entitled to the maternity leave benefit, a female employee should
be an SSS member employed at the time of her delivery or miscarriage; she must have given the
required notification to the SSS through her employer; and her employer must have paid at least
three monthly contributions to the SSS within the twelve -month period immediately before the
date of the contingency.”

On the other hand, Ben is not entitled to Paternity leave. According to Republic Act No.
8187, Paternity Leave Act of 1996, every married male employee in the private and public
sectors shall be entitled to a paternity leave of seven (7) days with full pay for the first four (4)
deliveries of the legitimate spouse with whom he is cohabiting.

The paternity leave applies to men who are employed in the government and private companies
as long as he meets the following criteria:

1. He has to be legally married to his wife.

2. He and his wife is living under one roof. The law explicitly says they need to be
cohabitating to avail of the benefit.
3. His wife is giving birth or had suffered a miscarriage.
4. He and his wife are welcoming their first, second, third, or fourth child, or his wife has
not had a miscarriage more than four times. Similar to the maternity leave benefit,
paternity leave is only provided for the first four pregnancies or miscarriages.
5. He has notified his employers of his wife's pregnancy, as soon as he learns that his
spouse is pregnant or within a reasonable period before she's due to deliver the child.
(This condition does not apply in cases of miscarriage.)

VI.

JOEY
(10pts)

Joey’s annual salary is computed at P450.00 x 365 days in a year or a total of

Php164,250. He is a rank-and0-file employee.

6.1 Is he a daily paid employee? Why?

No, Joey is not a daily paid employee. Based from the computation of his annual salary, the days
counted is based on the number of days in a whole year and NOT his actual working days. Thus,
he does not fall under the category of a daily paid employee.

6.2 Is he a monthly paid employee? Why?

Yes, Joey is a monthly paid employee. Based from the computation of his annual salary, the days
counted is based on the number of days in a whole year including the days that he is not
supposed to go to work and regular holidays. Thus, he does fall under the category of a monthly
paid employee.

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6.3 Is he entitled to holiday pay? Why?

Yes, Joey is entitled to holiday pay. Under the Labor Code and its Implementing Rules
and Regulation, a monthly paid employee is entitled to receive holiday pay. In the case
at bar, it is a matter of fact that Joey falls under the category of a monthly paid
employee based on the computation of his annual salary. Therefore, Joey being a
monthly paid employee entitles him to receive holiday pay.

6.4 Is he underpaid? Why?

No, Joey is not underpaid. The current minimum daily wage is P515.00 as determined
by the Philippine Government. Based from the facts, although the factor considered, an
amount of P450.00, is below the current minimum daily wage, it must be noted that
Joey is a monthly paid employee. Being said, the annual salary, as computed, of
P164,250.00 is not to be considered a case of underpayment.

6.5 Is there a violation of the Labor Code? What?

No, the is no violation of the Labor Code. The facts of the case only suggest the
computation of Joey's annual payment with emphasis that he is a rank-and-file
employee. There is no underpayment in his case because his daily pay is above the
minimum wage. In no instance can we stretch the facts provided to come up with any
violation of the Labor Code. Therefore, there is no violation of the Labor Code in this
case.

VII

ALBERT AND INDAY

(5 pts)

Albert, a 40-year old employer, asked his domestic helper, Inday, to give him a private massage.
When Inday refused, Albert showed her Article 141 of the Labor Code, which says that one of
the duties of a domestic helper is to minister to the employer’s personal comfort and
convenience.

[a] Is Inday’s refusal tenable? Explain. (3%)

[b] Distinguish briefly, but clearly, a "househelper" from a "homeworker." (2%)

VIII

CONTRACTUALIZATION

(5 pts)

In her State of the Nation Address, the President stressed the need to provide an investor-
friendly business environment so that the country can compete in the global economy that now
suffers from a crisis bordering on recession. Responding to the call, Congress passed two
innovative legislative measures, namely: (1) a law abolishing the security of tenure clause in the
Labor Code; and (2) a law allowing contractualization in all areas needed in the employer’s

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business operations. However, to soften the impact of these new measures, the law requires
that all employers shall obtain mandatory unemployment insurance coverage for all their
employees. The constitutionality of the two (2) laws is challenged in court. As judge, how will
you rule? (5%)

IX

JOLLI-MAC

(5 pts)

Jolli-Mac Restaurant Company (Jolli-Mac) owns and operates the largest food chain in the
country. It engaged Matiyaga Manpower Services, Inc. (MMSI), a job contractor registered with
the Department of Labor and Employment, to provide its restaurants the necessary personnel,
consisting of cashiers, motorcycle delivery boys and food servers, in its operations. The Service
Agreement warrants, among others, that MMSI has a paid- up capital of P2,000,000.00; that it
would train and determine the qualification and fitness of all personnel to be assigned to Jolli-
Mac; that it would provide these personnel with proper Jolli-Mac uniforms; and that it is
exclusively responsible to these personnel for their respective salaries and all other mandatory
statutory benefits.

After the contract was signed, it was revealed, based on research conducted, that MMSI had no
other clients except Jolli- Mac, and one of its major owners was a member of the Board of
Directors of Jolli-Mac.

[a] Is the Service Agreement between Jolli-Mac and MMSI legal and valid? Why or why not? (3%)

SUGGESTED ANSWER:
No, it is not legal and valid because MMSI is engaged in labor-only contracting. For one, the
workers supplied by MMSI to Jolli-Mac are performing services which are directly related to the
principal business of JolliMac. This is so because the duties performed by the workers are
integral steps in or aspects of the essential operations of the principal[la (Baguio, et al. v. NLRC,
et al., 202 SCRA 465 [1991]; Kimberly Independent Labor Union, etc. v. Drillon, 185 SCRA 190
[1990]. For another, MMSI was organized by JolliMac itself to supply its personnel requirements
(San Miguel Corporation v. MAERC Integrated Services, Inc., et al., 405 SCRA 579 [2003]).
ALTERNATIVE ANSWER:
The Service Agreement is valid. The law, Art. 106, does not invalidate an Independent
Contractors Agreement because an Independent Contractor has only one (1) client, or that the
employer of the independent contractor is one of the major owners of the employing
establishment. MMSI, is an independent business, adequately capitalized and assumed all the
responsibilities of a legitimate Independent Contractor.

[b] If the cashiers, delivery boys and food servers are not paid their lawful salaries, including
overtime pay, holiday pay, 13th month pay, and service incentive leave pay, against whom may
these workers file their claims? Explain. (2%)

SUGGESTED ANSWER:
They may file their claims against JolliMac. A finding that MMSI is a ―laboronly contractor is
equivalent to declaring there is an employer-employee relationship between Jolli-Mac and the

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workers of MMSI (Associated AngloAmerican Tobacco Corp. v. Clave, 189 SCRA 127 [1990],
Industrial Timber Corp. v. NLRC, 169 SCRA 341 [1989]). The liability of Jolii-Mac vis-avis the
wokers of MMSI is for a comprehensive purpose, i.e., not only for the unpaid wages but for all
claims under the Labor
Code and ancillary laws (San Miguel Corp. v. Maerc Integrated Services, Inc., et el., 405 SCRA 579
[2003]).

ALTERNATIVE ANSWER: The employers can file their claims against Jolli-Mac pursuant to Art.
106 of the Labor Code which reads: ―Contractor or subcontractor – xxx In the event that the
contractor or subcontractor fails to pay the wages of his employees in accordance with this
Code, the employer shall be jointly and severally liable with his contractor or subcontractor to
such employees to the extent of the work performed under the contract, in the same manner
and extent, that he is liable to employee directly employed by him.

PEDRO AND SUPER COMFY HOTEL

(5pts)

Super Comfort Hotel employed a regular pool of “extra waiters” who are called or asked to
report for duty when the Hotel’s volume of business is beyond the capacity of the regularly
employed waiters to undertake. Pedro has been an “extra waiter” for more than 10 years. He is
also called upon to work on weekends, on holidays and when there are big affairs at the hotel.

What is Pedros’ status as an employee under the Labor Code? Why? Explain your answer fully.
(5%)

ANSWER: Article 280 of the labor code provides that: “ The provisions of written agreement to
the contrary notwithstanding and regardless of the oral agreement of the parties, an
employment shall be deemed to be regular where the employee has been engaged to perform
activities which are usually necessary or desirable in the usual business or trade of the
employer, except where the employment has been fixed for a specific project or undertaking
the completion or termination of which has been determined at the time of the engagement of
the employee or where the work or service to be performed is seasonal in nature and the
employment is for the duration of the season. An employment shall be deemed to be casual if it
is not covered by the preceding paragraph: Provided, That any employee who has rendered at
least one year of service, whether such service is continuous or broken, shall be considered a
regular employee with respect to the activity in which he is employed and his employment shall
continue while such activity exists.”

Article 280 is applicable in this case. This is because Pedro has been engaged in the
performance of the activities necessary or desirable to the usual business of the employer.
Furthermore, Pedro has been an extra waiter for 10 years. These facts qualifies him to be a
regular employee regardless of his service being continuous or broken.

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XI

PIZCORP

(10 pts)

The Pizza Corporation (PizCorp) and Ready Supply Cooperative (RSC) entered into a “service
agreement” wherein RSC, in consideration of service fees to be paid by PizCorp, will exclusively
supply PizCorp with a group of RSC motorcyle-owning cooperative members who will
henceforth perform PizCorp’s pizza delivery service. RSC assumes — under the agreement — full
obligation for the payment of the salaries and other statutory monetary benefits of its members
deployed to PizCorp. The parties also stipulated that there shall be no employer-employee
relationship between PizCorp and the RSC members. However, if PizCorp is materially
prejudiced by any act of the delivery crew that violates PizCorp’s directives and orders, PizCorp
can directly impose disciplinary actions on, including the power to dismiss, the erring RSC
member/s.

a) Is the contractual stipulation that there is no employer-employee relationship binding on

labor officials? Why? Explain fully. (3%)

b) Based on the test/s for employer-employee relationship, determine the issue of who is the
employer of the RSC members. (4%)

c) Assume that RSC has a paid-up capitalization of P1,000,000.00. Is RSC engaged in “labor only”
contracting, permissible job contracting or simply, recruitment? (3%)

XII

CASE OF THE WAITERS

(10pts)

Complainants had worked five (5) years as waitresses in a cocktail lounge owned by the
respondent. They did not receive any salary directly from the respondent but shared in all
service charges collected for food and drinks to the extend of 75%. With respondent’s prior
permission, they could sit with and entertain guests inside the establishment and appropriate
for themselves the tips given by guests. After five (5) years, the complainants’ individual shares
in the collected service charges dipped to below minimum wage level as a consequence of the
lounge’s marked business decline. Thereupon, complainants asked respondent to increase their
share in the collected service charges to 85%, or the minimum wage level, whichever is higher.

Respondent terminated the services of the complainants who countered by filing a consolidated
complaint for unlawful dismissal, with prayer for 85% of the collected services or the minimum
wage for the appropriate periods, whichever is higher. Decide.

Art. 138 of the Labor Code provides as follows:

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―art. 138. Classification of certain women workers. – any woman who is permitted or
suffered to work, with or without compensation, in any night club, cocktail lounge, massage
clinic, bar or similar establishment, under the effective control or supervision of the employer
for a substantial period of time as determined by the Secretary of Labor, shall be considered as
an employee of such establishment for purposes of labor and social legislation.‖
Since complainants are under the effective control and supervision of respondent, they are
therefore considered as employees and entitled to full backwages based on the minimum wage
for the appropriate period plus 85% of the collected service charges.

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