D.

Wage Prohibitions
1. prohibition against interference in disposal of wages
ART. 112. Non-interference in disposal of wages. - No employer shall limit or otherwise interfere with the
freedom of any employee to dispose of his wages. He shall not in any manner force, compel, or oblige his
employees to purchase merchandise, commodities or other property from any other person, or otherwise
mae use of any store or ser!ices of such employer or any other person.
"ec #. $%&' shall chec(
payroll
other financial records
to determine whether worers are properly paid or granted benefits under law or wage order
)nioni*ed companies(
president or responsible officer of bargaining unit or of any interested union shall accompany
inspector
Non-unioni*ed companies(
inspection in the presence of a worer representing worers
rep shall ha!e right to inspect own findings to $%&' and testify if he cannot concur with findings
of labor inspector
2. +rohibition against wage deduction
ART. 11,. Wage deduction. - No employer, in his own behalf or in behalf of any person, shall mae any
deduction from the wages of his employees, e-cept(
.a/ 0n cases where the worer is insured with his consent by the employer, and the deduction is to
recompense the employer for the amount paid by him as premium on the insurance1
.b/ 2or union dues, in cases where the right of the worer or his union to chec-off has been recogni*ed by
the employer or authori*ed in writing by the indi!idual worer concerned1 and
.c/ 0n cases where the employer is authori*ed by law or regulations issued by the "ecretary of &abor and
'mployment.
"ec 13. funds from( included in annual 4A
5ompensation and %rgani*ational Ad6ustment 2und
5ontingent 2und
%ther sa!ings under RA 7788 .general appropriations acts of 1#8#/
2rom any unappropriated funds of National Treasury
Apodaca vs NLRC, 172 SCRA 2
!acts"
#etitioner was persuaded to su$scri$e to 1%&& s'ares of corporation(s stoc)s. *e paid +7,%&& out of
1%&,&&& $ut on ,anuar- 2, 1./0, 'e resigned.
1nstituted co2plaint for pa-2ent of unpaid wages, C3LA, etc. Co2pan- ac)nowledged unpaid wages $ut
said t'at t'is 'as $een applied to petitioner(s unpaid $alance.
1ssue 1" W3N NLRC 'as 4urisdiction over case
*eld" N3
Ratio"
intracorporate dispute $etween stoc)'older and corporation as in t'e 2atter of unpaid
su$scriptions
1ssue" W3N suc' t-pe of wage deduction is valid
*eld" N3
Ratio"
no notice or call for pa-2ent of unpaid su$scriptions so pre2ature
Article 11+ allows wage deductions onl- in + instances.
5a6 1n cases w'ere t'e wor)er is insured wit' 'is consent $- t'e e2plo-er, and t'e deduction is to
reco2pense t'e e2plo-er for t'e a2ount paid $- 'i2 as pre2iu2 on t'e insurance7
5$6 !or union dues, in cases w'ere t'e rig't of t'e wor)er or 'is union to c'ec)-off 'as $een
recogni8ed $- t'e e2plo-er or aut'ori8ed in writing $- t'e individual wor)er concerned7 and
5c6 1n cases w'ere t'e e2plo-er is aut'ori8ed $- law or regulations issued $- t'e Secretar- of La$or
and 92plo-2ent.
,. +rohibition against re9uirement to mae deposits for loss or damage
ART. 11:. :eposits for loss or da2age. - No employer shall re9uire his worer to mae deposits from which
deductions shall be made for the reimbursement of loss of or damage to tools, materials, or e9uipment
supplied by the employer,
e-cept when the employer is engaged in such trades, occupations or business where the practice
of maing deductions or re9uiring deposits is a recogni*ed one, or is necessary or desirable as
determined by the "ecretary of &abor and 'mployment in appropriate rules and regulations.
ART. 11;. Li2itations. - No deduction from the deposits of an employee for the actual amount of the loss
or damage shall be made unless the employee has been heard thereon, and his responsibility has been
clearly shown.
"ec 11.
National <ages 5ouncil under '% 71: abolished
National +roducti!ity 5ommission under '% 71; abolished
stuff transferred to 5ommission
personnel( continue to function in a holdo!er capacity and shall be preferentially considered for
appointments to or placement in 5ommission
employee separated from ser!ice( separation pay and retirement pay and other benefits
also preferred
:entec' 2anufacturing vs NLRC
!acts"
Respondents used to wor) as welders, up'olsterers, and painters of co2pan-. ;'e- were dis2issed"
allegedl- co8 of union activities 5Confederation of Citi8ens La$or <nion6
Wanted to get refund of cas' $ond filed $ut co2pan- said t'at t'ese 'ave $een given to a certain
carinderia to pa- for t'e outstanding accounts of private respondents.
1ssue" W3N suc' re=uire2ent of cas' $ond is valid
*eld" No
Ratio"
co2pan- failed to s'ow t'at it is aut'ori8ed $- law to re=uire wor)ers to file cas' $ond
refund>>
!ive , ;a?i vs NLRC
!acts"
@aldigan" wor)ing wit' @ine of Aold
Sa$salon" wor)ing wit' Bula)la) Co2pan-
a$andoned ca$ in @a)ati wit'out fuel refill wort' +&&
refused to wor)
wanted rei2$urse2ent of dail- cas' deposit"
2&- car was'ing
1%- for an- deficienc- in t'eir $oundar- for ever- actual da-
1ssue" W3N suc' deposits 2a- $e rei2$ursed
*eld" Ces to 1%, no to 2&
Ratio"
1. to defra- deficienc- in $oundar- is not conte2plated $- 115loss or da2age to tools, 2aterials,
e=uip2ent6
2. w'en t'e- stopped wor)ing, alleged purpose for deposits no longer e?isted
2& pesos"
1. not entitled to refund
2. not'ing could prevent t'e2 fro2 was'ing cars t'e2selves
:. +rohibition against withholding of wages
ART. 117. Wit''olding of wages and )ic)$ac)s pro'i$ited. - 0t shall be unlawful for any person, directly or
indirectly, to withhold any amount from the wages of a worer or induce him to gi!e up any part of his
wages by force, stealth, intimidation, threat or by any other means whatsoe!er without the worer=s
consent.
;. +rohibition against deduction to ensure employment
ART. 11>. :eduction to ensure e2plo-2ent. - 0t shall be unlawful to mae any deduction from the wages
of any employee for the benefit of the employer or his representati!e or intermediary as consideration of
a promise of employment or retention in employment.
7. +rohibition against retaliatory measures
ART. 118. Retaliator- 2easures. - 0t shall be unlawful for an employer to refuse to pay or reduce the wages
and benefits, discharge or in any manner discriminate against any employee who has filed any complaint
or instituted any proceeding under this Title or has testified or is about to testify in such proceedings.
>. +rohibition against false reporting
ART. 11#. !alse reporting. - 0t shall be unlawful for any person to mae any statement, report, or record
filed or ept pursuant to the pro!isions of this 5ode nowing such statement, report or record to be false
in any material respect.
8. +rohibiting against eeping of employee=s records in a place other than the worplace
.rule 13/ "'5T0%N 11. +lace of records. ? All employment records of the employees shall be ept and
maintained by the employer in or about the premises of the wor place. The premises of a wor-place
shall be understood to mean the main or branch office of the establishment, if any, depending upon
where the employees are regularly assigned. The eeping of the employee@s records in another place is
prohibited.
Sout' @otorists vs ;osoc, 1/1 SCRA +/0
#. prohibition against garnishmentAe-ecution
Art. 1>38. The laborer@s wages shall not be sub6ect to e-ecution or attachment,
e-cept for debts incurred for food, shelter, clothing and medical attendance
Aaa vs CA, 1& SCRA +&
!acts"
Aaa was $uilding ad2in of ;rinit- Building.
acts t'at 9urop'il 1ndustries considered as trespass upon its rig'ts" cutting off its
electricit-, re2oving its na2e fro2 $uilding director-, gate passes
writ of garnis'2ent of Aaa(s salar-, co22ission, andDor re2uneration.
1ssue" Won suc' writ of garnis'2ent 2a- $e e?ecuted
*eld" Ces
Ratio"
1. 2anagerial or supervisor- e2plo-ee" for planning, directing, controlling and coordinating t'e
activities of all 'ouse)eeping personnel
2. not a la$orer" 2anual and p'-sical la$or
+. wages vs salar-" wages for 2anual la$or, s)illed or uns)illed, paid at stated ti2es, and 2easured
$- da-, wee), 2ont' or season w'ile salar- denotes a 'ig'er degree of e2plo-2ent
'. <%RB'R +R'2'R'N5' 0N TH' 'C'NT %2 DANBR)+T5E
ART. 113. Wor)er preference in case of $an)ruptc-. - 0n the e!ent of
banruptcy or
li9uidation of an employer=s business,
his workers shall enjoy first preference as regards their wages and other monetary claims, any
provisions of law to the contrary notwithstanding. Such unpaid wages and monetary claims shall be
paid in full before claims of the government and other creditors may be paid. (As amended by
Section 1, Republic Act o. !"1#, $arch %1, 1&'&(.
Art. 1>3>. The laborer@s wages shall be a lien on the goods manufactured or the wor done.
Art. 22:1. <ith reference to specific mo!able property of the debtor, the following claims or liens shall be preferred(
.1/ $uties, ta-es and fees due thereon to the "tate or any subdi!ision thereof1

.2/ 5laims arising from misappropriation, breach of trust, or malfeasance by public officials committed in the
performance of their duties, on the mo!ables, money or securities obtained by them1

.,/ 5laims for the unpaid price of mo!ables sold, on said mo!ables, so long as they are in the possession of the debtor,
up to the !alue of the same1 and if the mo!able has been resold by the debtor and the price is still unpaid, the lien
may be enforced on the price1 this right is not lost by the immobili*ation of the thing by destination, pro!ided it has not
lost its form, substance and identity1 neither is the right lost by the sale of the thing together with other property for a
lump sum, when the price thereof can be determined proportionally1

.:/ 5redits guaranteed with a pledge so long as the things pledged are in the hands of the creditor, or those
guaranteed by a chattel mortgage, upon the things pledged or mortgaged, up to the !alue thereof1

.;/ 5redits for the maing, repair, safeeeping or preser!ation of personal property, on the mo!able thus made,
repaired, ept or possessed1

.7/ 5laims for laborers@ wages, on the goods manufactured or the wor done1

.>/ 2or e-penses of sal!age, upon the goods sal!aged1

.8/ 5redits between the landlord and the tenant, arising from the contract of tenancy on shares, on the share of each
in the fruits or har!est1

.#/ 5redits for transportation, upon the goods carried, for the price of the contract and incidental e-penses, until their
deli!ery and for thirty days thereafter1

.13/ 5redits for lodging and supplies usually furnished to tra!elers by hotel eepers, on the mo!ables belonging to the
guest as long as such mo!ables are in the hotel, but not for money loaned to the guests1

.11/ 5redits for seeds and e-penses for culti!ation and har!est ad!anced to the debtor, upon the fruits har!ested1

.12/ 5redits for rent for one year, upon the personal property of the lessee e-isting on the immo!able leased and on
the fruits of the same, but not on money or instruments of credit1

.1,/ 5laims in fa!or of the depositor if the depositary has wrongfully sold the thing deposited, upon the price of the
sale.

0n the foregoing cases, if the mo!ables to which the lien or preference attaches ha!e been wrongfully taen, the
creditor may demand them from any possessor, within thirty days from the unlawful sei*ure. .1#22a/
Art. 22:2. <ith reference to specific immo!able property and real rights of the debtor, the following claims, mortgages
and liens shall be preferred, and shall constitute an encumbrance on the immo!able or real right(

.1/ Ta-es due upon the land or building1

.2/ 2or the unpaid price of real property sold, upon the immo!able sold1

.,/ 5laims of laborers, masons, mechanics and other wormen, as well as of architects, engineers and contractors,
engaged in the construction, reconstruction or repair of buildings, canals or other wors, upon said buildings, canals or
other wors1

.:/ 5laims of furnishers of materials used in the construction, reconstruction, or repair of buildings, canals or other
wors, upon said buildings, canals or other wors1

.;/ Fortgage credits recorded in the Registry of +roperty, upon the real estate mortgaged1

.7/ '-penses for the preser!ation or impro!ement of real property when the law authori*es reimbursement, upon the
immo!able preser!ed or impro!ed1

.>/ 5redits annotated in the Registry of +roperty, in !irtue of a 6udicial order, by attachments or e-ecutions, upon the
property affected, and only as to later credits1
.8/ 5laims of co-heirs for warranty in the partition of an immo!able among them, upon the real property thus di!ided1

.#/ 5laims of donors or real property for pecuniary charges or other conditions imposed upon the donee, upon the
immo!able donated1

.13/ 5redits of insurers, upon the property insured, for the insurance premium for two years. .1#2,a/
Art. 22::. <ith reference to other property, real and personal, of the debtor, the following claims or credits shall be
preferred in the order named(

.1/ +roper funeral e-penses for the debtor, or children under his or her parental authority who ha!e no property of their
own, when appro!ed by the court1

.2/ 5redits for ser!ices rendered the insol!ent by employees, laborers, or household helpers for one year preceding the
commencement of the proceedings in insol!ency1

.,/ '-penses during the last illness of the debtor or of his or her spouse and children under his or her parental
authority, if they ha!e no property of their own1

.:/ 5ompensation due the laborers or their dependents under laws pro!iding for indemnity for damages in cases of
labor accident, or illness resulting from the nature of the employment1

.;/ 5redits and ad!ancements made to the debtor for support of himself or herself, and family, during the last year
preceding the insol!ency1

.7/ "upport during the insol!ency proceedings, and for three months thereafter1

.>/ 2ines and ci!il indemnification arising from a criminal offense1

.8/ &egal e-penses, and e-penses incurred in the administration of the insol!ent@s estate for the common interest of
the creditors, when properly authori*ed and appro!ed by the court1

.#/ Ta-es and assessments due the national go!ernment, other than those mentioned in Articles 22:1, No. 1, and 22:2,
No. 11

.13/ Ta-es and assessments due any pro!ince, other than those referred to in Articles 22:1, No. 1, and 22:2, No. 11

.11/ Ta-es and assessments due any city or municipality, other than those indicated in Articles 22:1, No. 1, and 22:2,
No. 11
.12/ $amages for death or personal in6uries caused by a 9uasi-delict1

.1,/ 4ifts due to public and pri!ate institutions of charity or beneficence1

.1:/ 5redits which, without special pri!ilege, appear in .a/ a public instrument1 or
.b/ in a final 6udgment, if they ha!e been the sub6ect of litigation. These credits shall ha!e preference among
themsel!es in the order of priority of the dates of the instruments and of the 6udgments, respecti!ely. .1#2:a/
Phil Export vs CA, 251 SCRA 354
Repu$lic vs #eralta, 1%& SCRA +7
F. WAGE RECOVERY/JURISDICTION
ART. 128. Eisitorial and enforce2ent power. - .a/ The "ecretary of &abor and 'mployment or his duly authori*ed
representati!es, including labor regulation officers, shall ha!e access to employer=s records and premises at any time
of the day or night whene!er wor is being undertaen therein, and the right to copy therefrom, to 9uestion any
employee and in!estigate any fact, condition or matter which may be necessary to determine !iolations or which may
aid in the enforcement of this 5ode and of any labor law, wage order or rules and regulations issued pursuant thereto.
(b( otwithstanding the provisions of Articles 1%& and %1" of this )ode to the contrary, and in cases where the relationship of employer*employee
still e+ists, the Secretary of ,abor and -mployment or his duly authori.ed representatives shall have the power to issue compliance orders to give
effect to the labor standards provisions of this )ode and other labor legislation based on the findings of labor employment and enforcement officers or
industrial safety engineers made in the course of inspection. /he Secretary or his duly authori.ed representatives shall issue writs of e+ecution to the
appropriate authority for the enforcement of their orders, e+cept in cases where the employer contests the findings of the labor employment and
enforcement officer and raises issues supported by documentary proofs which were not considered in the course of inspection. (As amended by
Republic Act o. ""01, 2une %, 1&&3(.
An order issued by the duly authori*ed representati!e of the "ecretary of &abor and 'mployment under this
Article may be appealed to the latter. 0n case said order in!ol!es a monetary award, an appeal by the
employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding
company duly accredited by the "ecretary of &abor and 'mployment in the amount e9ui!alent to the
monetary award in the order appealed from. .As amended by Republic Act No. >>,3, Gune 2, 1##:/.
.c/ The "ecretary of &abor and 'mployment may liewise order stoppage of wor or suspension of operations
of any unit or department of an establishment when non-compliance with the law or implementing rules and
regulations poses gra!e and imminent danger to the health and safety of worers in the worplace. <ithin
twenty-four hours, a hearing shall be conducted to determine whether an order for the stoppage of wor or
suspension of operations shall be lifted or not. 0n case the !iolation is attributable to the fault of the employer,
he shall pay the employees concerned their salaries or wages during the period of such stoppage of wor or
suspension of operation.
.d/ 0t shall be unlawful for any person or entity to obstruct, impede, delay or otherwise render ineffecti!e the
orders of the "ecretary of &abor and 'mployment or his duly authori*ed representati!es issued pursuant to the
authority granted under this Article, and no inferior court or entity shall issue temporary or permanent
in6unction or restraining order or otherwise assume 6urisdiction o!er any case in!ol!ing the enforcement
orders issued in accordance with this Article.
.e/ Any go!ernment employee found guilty of !iolation of, or abuse of authority, under this Article shall, after
appropriate administrati!e in!estigation, be sub6ect to summary dismissal from the ser!ice.
.f/ The "ecretary of &abor and 'mployment may, by appropriate regulations, re9uire employers to eep and
maintain such employment records as may be necessary in aid of his !isitorial and enforcement powers under
this 5ode.
ART. 12#. Recover- of wages, si2ple 2one- clai2s and ot'er $enefits. - )pon complaint of any interested party, the
Regional $irector of the $epartment of &abor and 'mployment or any of the duly authori*ed hearing officers of the
$epartment is empowered, through summary proceeding and after due notice, to hear and decide any matter in!ol!ing
the reco!ery of wages and other monetary claims and benefits, including legal interest, owing to an employee or
person employed in domestic or household ser!ice or househelper under this 5ode, arising from employer-employee
relations( +ro!ided, That such complaint does not include a claim for reinstatement( +ro!ided further, That the
aggregate money claims of each employee or househelper does not e-ceed 2i!e thousand pesos .+;,333.33/. The
Regional $irector or hearing officer shall decide or resol!e the complaint within thirty .,3/ calendar days from the date
of the filing of the same. Any sum thus reco!ered on behalf of any employee or househelper pursuant to this Article
shall be held in a special deposit account by, and shall be paid on order of, the "ecretary of &abor and 'mployment or
the Regional $irector directly to the employee or househelper concerned. Any such sum not paid to the employee or
househelper because he cannot be located after diligent and reasonable effort to locate him within a period of three .,/
years, shall be held as a special fund of the $epartment of &abor and 'mployment to be used e-clusi!ely for the
amelioration and benefit of worers.
Any decision or resolution of the Regional $irector or hearing officer pursuant to this pro!ision may be
appealed on the same grounds pro!ided in Article 22, of this 5ode, within fi!e .;/ calendar days from receipt
of a copy of said decision or resolution, to the National &abor Relations 5ommission which shall resol!e the
appeal within ten .13/ calendar days from the submission of the last pleading re9uired or allowed under its
rules.
The "ecretary of &abor and 'mployment or his duly authori*ed representati!e may super!ise the payment of
unpaid wages and other monetary claims and benefits, including legal interest, found owing to any employee
or househelper under this 5ode. .As amended by "ection 2, Republic Act No. 7>1;, Farch 21, 1#8#/.
ART. 21>. ,urisdiction of t'e La$or Ar$iters and t'e Co22ission. - .a/ '-cept as otherwise pro!ided under this
5ode, the &abor Arbiters shall ha!e original and e-clusi!e 6urisdiction to hear and decide, within thirty .,3/
calendar days after the submission of the case by the parties for decision without e-tension, e!en in the
absence of stenographic notes, the following cases in!ol!ing all worers, whether agricultural or non-
agricultural(
1. )nfair labor practice cases1
2. Termination disputes1
,. 0f accompanied with a claim for reinstatement, those cases that worers may file in!ol!ing
wages, rates of pay, hours of wor and other terms and conditions of employment1
:. 5laims for actual, moral, e-emplary and other forms of damages arising from the
employer-employee relations1
;. 5ases arising from any !iolation of Article 27: of this 5ode, including 9uestions in!ol!ing
the legality of stries and locouts1 and
7. '-cept claims for 'mployees 5ompensation, "ocial "ecurity, Fedicare and maternity
benefits, all other claims arising from employer-employee relations, including those of
persons in domestic or household ser!ice, in!ol!ing an amount e-ceeding fi!e thousand
pesos .+;,333.33/ regardless of whether accompanied with a claim for reinstatement.
.b/ The 5ommission shall ha!e e-clusi!e appellate 6urisdiction o!er all cases decided by &abor Arbiters.
.c/ 5ases arising from the interpretation or implementation of collecti!e bargaining agreements and those arising from
the interpretation or enforcement of company personnel policies shall be disposed of by the &abor Arbiter by referring
the same to the grie!ance machinery and !oluntary arbitration as may be pro!ided in said agreements. .As amended
by "ection #, Republic Act No. 7>1;, Farch 21, 1#8#/.
ART. 111. Attorne-(s fees. - .a/ 0n cases of unlawful withholding of wages, the culpable party may be
assessed attorney=s fees e9ui!alent to ten percent of the amount of wages reco!ered.
.b/ 0t shall be unlawful for any person to demand or accept, in any 6udicial or administrati!e proceedings
for the reco!ery of wages, attorney=s fees which e-ceed ten percent of the amount of wages reco!ered.
Auico vs Sec of La$or, 2./ SCRA 007 5./6
Servando(s 1nc. vs Sec of La$or, 1/ SCRA 00 5.&6
7. 1,
th
Fonth +ay- +$ 8;1
5ases(
Arc'illes @anufacturing Corp vs NLRC, 22 SCRA 7%& 5.%6
Songco vs NLRC, 1/+ SCRA 01& 5.&6
Boie ;a)eda vs de la Serna, 22/ SCRA +2. 5.+6
#'il :uplicators 1nc. vs NLRC, 21 SCRA +/& 5.%6
1ran vs NLRC, 2/. SCRA ++ 5./6
!ra2anlis !ar2s, 1nc vs @3L9, 171 SCRA /7 5/.6
>. Donus
a. nature
Phil Duplicators
b. $efinition1 <hen demandable
Lu8on Stevedoring Corporation vs C1R, 1% SCRA 00& 50%6
Business 1nfor2ation S-ste2s and Services 1nc. vs NLRC, 221 SCRA . 5.+6
@arcos vs NLRC, 2/ SCRA 10 5.%6
@anila Ban)ing Corp vs NLRC, 27. SCRA 0&2 5.76
5. HousehelpersA 5aregi!ers
1. 5o!erage
ART. 1:1. Coverage. - This 5hapter shall apply to all persons rendering ser!ices in households for
compensation.
F:o2estic or 'ouse'old serviceF shall mean ser!ice in the employer=s home which is usually necessary or
desirable for the maintenance and en6oyment thereof and includes ministering to the personal comfort
and con!enience of the members of the employer=s household, including ser!ices of family dri!ers
Apex Mining Co. vs NLRC, 196 SCRA 21
5andido performed laundry ser!ices at the staff house of company. Degan as piece rate worer then later
was paid on monthly basis.
3n :ec. 1/, 1./7, w'ile s'e was 'anging laundr-, s'e fell on 'er $ac). S'e i22ediatel- reported incident
to dela Rosa, 'er i22ediate supervisor w'o offered 'er 2t'ou t'en %t'ou for 'er to =uit 'er 4o$. S'e
refused and preferred to return to wor) $ut petitioner did not allow 'er to wor) and s'e was dis2issed.
#etitioner clai2s t'at Candido s'ould $e treated as a 2ere 'ouse'elper or do2estic servant and not as a
regular e2plo-ee.
1ssue" W3N Candida was a 'ouse'older
*eld" No
Ratio"
1. .b/ The term HhousehelperH as used herein is synonymous to the term Hdomestic ser!antH and shall
refer to any person, whether male or female, who renders ser!ices in and about the employer@s home and
which ser!ices are usually necessary or desirable for the maintenance and en6oyment thereof, and
ministers e-clusi!ely to the personal comfort and en6oyment of the employer@s family.
2. criteria" personal co2fort and en4o-2ent of t'e fa2il- of t'e e2plo-er in t'e 'o2e of said e2plo-er
separation pa- granted. Reinstate2ent no longer possi$le.
2. Non-Household <or
ART. 1:;. Assign2ent to non-'ouse'old wor). - No househelper shall be assigned to wor in a commercial,
industrial or agricultural enterprise at a wage or salary rate lower than that pro!ided for agricultural or
non-agricultural worers as prescribed herein.
,. 5onditions of 'mployment
ART. 1:2. Contract of do2estic service. - The original contract of domestic ser!ice shall not last for more
than two .2/ years but it may be renewed for such periods as may be agreed upon by the parties.
ART. 1:,. @ini2u2 wage. - .a/ Househelpers shall be paid the following minimum wage rates(
.1/ 'ight hundred pesos .+833.33/ a month for househelpers in Fanila, Iue*on, +asay, and
5aloocan cities and municipalities of Faati, "an Guan, Fandaluyong, Funtinlupa, Na!otas,
Falabon, +araJa9ue, &as +iJas, +asig, Fariina, Calen*uela, Taguig and +ateros in Fetro Fanila
and in highly urbani*ed cities1
.2/ "i- hundred fifty pesos .+7;3.33/ a month for those in other chartered cities and first-class
municipalities1 and
.,/ 2i!e hundred fifty pesos .+;;3.33/ a month for those in other municipalities.
+ro!ided, That the employers shall re!iew the employment contracts of their househelpers e!ery
three .,/ years with the end in !iew of impro!ing the terms and conditions thereof.
+ro!ided, further, That those househelpers who are recei!ing at least %ne thousand pesos
.+1,333.33/ shall be co!ered by the "ocial "ecurity "ystem ."""/ and be entitled to all the
benefits pro!ided thereunder. .As amended by Republic Act No. >7;;, August 1#, 1##,/.
ART. 1::. @ini2u2 cas' wage. - The minimum wage rates prescribed under this 5hapter shall be the
basic cash wages which shall be paid to the househelpers in addition to lodging, food and medical
attendance.
ART. 1:;. Assign2ent to non-'ouse'old wor). - No househelper shall be assigned to wor in a commercial,
industrial or agricultural enterprise at a wage or salary rate lower than that pro!ided for agricultural or
non-agricultural worers as prescribed herein.
ART. 1:7. 3pportunit- for education. - 0f the househelper is under the age of eighteen .18/ years, the
employer shall gi!e him or her an opportunity for at least elementary education. The cost of education
shall be part of the househelper=s compensation, unless there is a stipulation to the contrary.
ART. 1:>. ;reat2ent of 'ouse'elpers. - The employer shall treat the househelper in a 6ust and humane
manner. 0n no case shall physical !iolence be used upon the househelper.
ART. 1:8. Board, lodging, and 2edical attendance. - The employer shall furnish the househelper, free of
charge, suitable and sanitary li!ing 9uarters as well as ade9uate food and medical attendance.
ART. 1:#. 1nde2nit- for un4ust ter2ination of services. - 0f the period of household ser!ice is fi-ed, neither
the employer nor the househelper may terminate the contract before the e-piration of the term, e-cept
for a 6ust cause. 0f the househelper is un6ustly dismissed, he or she shall be paid the compensation already
earned plus that for fifteen .1;/ days by way of indemnity.
0f the househelper lea!es without 6ustifiable reason, he or she shall forfeit any unpaid salary due him or
her not e-ceeding fifteen .1;/ days.
ART. 1;3. Service of ter2ination notice. - 0f the duration of the household ser!ice is not determined either
in stipulation or by the nature of the ser!ice, the employer or the househelper may gi!e notice to put an
end to the relationship fi!e .;/ days before the intended termination of the ser!ice.
ART. 1;1. 92plo-2ent certification. - )pon the se!erance of the household ser!ice relation, the employer
shall gi!e the househelper a written statement of the nature and duration of the ser!ice and his or her
efficiency and conduct as househelper.
ART. 1;2. 92plo-2ent record. - The employer may eep such records as he may deem necessary to
reflect the actual terms and conditions of employment of his househelper, which the latter shall
authenticate by signature or thumbmar upon re9uest of the employer.
Civil Code #rovisions
Art. 178#. Household ser!ice shall always be reasonably compensated. Any stipulation that household
ser!ice is without compensation shall be !oid. "uch compensation shall be in addition to the house
helper@s lodging, food, and
medical attendance.
Art. 17#3. The head of the family shall furnish, free of charge, to the house helper, suitable and sanitary
9uarters as well as ade9uate food and medical attendance.
Art. 17#1. 0f the house helper is under the age of eighteen years, the head of the family shall gi!e an
opportunity to the house helper for at least elementary education. The cost of such education shall be a
part of the house helper@s
compensation, unless there is a stipulation to the contrary.
Art. 17#2. No contract for household ser!ice shall last for more than two years. Howe!er, such contract
may be renewed from year to year.
Art. 17#,. The house helper@s clothes shall be sub6ect to stipulation. Howe!er, any contract for household
ser!ice shall be !oid if thereby the house helper cannot afford to ac9uire suitable clothing.
Art. 17#:. The head of the family shall treat the house helper in a 6ust and humane manner. 0n no case
shall physical !iolence be used upon the house helper.
Art. 17#;. House helper shall not be re9uired to wor more than ten hours a day.
'!ery house helper shall be allowed four days@ !acation each month, with pay.
Art. 17#7. 0n case of death of the house helper, the head of the family shall bear the funeral e-penses if
the house helper has no relati!es in the place where the head of the family li!es, with sufficient means
therefor.
Art. 17#>. 0f the period for household ser!ice is fi-ed neither the head of the family nor the house helper
may terminate the contract before the e-piration of the term, e-cept for a 6ust cause. 0f the house helper
is un6ustly dismissed, he shall be paid the compensation already earned plus that for fifteen days by way
of indemnity. 0f the house helper lea!es without 6ustifiable reason, he shall
forfeit any salary due him and unpaid, for not e-ceeding fifteen days.
Art. 17#8. 0f the duration of the household ser!ice is not determined either by stipulation or by the nature
of the ser!ice, the head of the family or the house helper may gi!e notice to put an end to the ser!ice
relation, according to the following rules(

.1/ 0f the compensation is paid by the day, notice may be gi!en on any day that the ser!ice shall end at
the close of the following day1

.2/ 0f the compensation is paid by the wee, notice may be gi!en, at the latest on the first business day
of the wee, that the ser!ice shall be terminated at the end of the se!enth day from the beginning of the
wee1 .,/ 0f the compensation is paid by the month, notice may be gi!en, at the latest, on the fifth day of
the month, that the ser!ice shall cease at the end of the month.
Art. 17##. )pon the e-tinguishment of the ser!ice relation, the house helper may demand from the head
of the family a written statement on the nature and duration of the ser!ice and the efficiency and conduct
of the house helper.
:. *o2ewor)ers
1. 5o!erage and Regulation
ART. 1;,. Regulation of industrial 'o2ewor)ers. - The employment of industrial homeworers and field
personnel shall be regulated by the go!ernment through the appropriate regulations issued by the
"ecretary of &abor and 'mployment to ensure the general welfare and protection of homeworers and
field personnel and the industries employing them.
ART. 1;:. Regulations of Secretar- of La$or. - The regulations or orders to be issued pursuant to this
5hapter shall be designed to assure the minimum terms and conditions of employment applicable to the
industrial homeworers or field personnel in!ol!ed.
ART. 1;;. :istri$ution of 'o2ewor). - 2or purposes of this 5hapter, the Fe2plo-erF of homeworers
includes any person, natural or artificial who, for his account or benefit, or on behalf of any person
residing outside the country, directly or indirectly, or through an employee, agent contractor, sub-
contractor or any other person(
.1/ $eli!ers, or causes to be deli!ered, any goods, articles or materials to be processed or
fabricated in or about a home and thereafter to be returned or to be disposed of or distributed in
accordance with his directions1 or
.2/ "ells any goods, articles or materials to be processed or fabricated in or about a home and
then rebuys them after such processing or fabrication, either by himself or through some other
person.
:epart2ent 3rder No. %, :3L9, !e$ruar- , 1..2
"'5T0%N 1. 4eneral statement on co!erage. ? This Rule shall apply to any person who performs
industrial homewor for an employer, contractor or sub-contractor.
2. $efinition- "ec 2, $% N% ;
"'5T0%N 2. $efinitions. ? As used in this Rule, the following terms shall ha!e the meanings indicated
hereunder(
.a/ H0ndustrial HomeworH is a system of production under which wor for an employer or contractor
is carried out by a homewor at hisAher home. Faterials may or may not be furnished by the employer or
contractor. cdphil
0t differs from regular factory production principally in that, it is a decentrali*ed form of production where
there is ordinarily !ery little super!ision or regulation of methods of wor.
.b/ H0ndustrial HomeworerH means a worer who is engaged in industrial homewor.
.c/ HHomeH means any room, house, apartment or other premises used regularly, in whole or in part,
as dwelling place, e-cept those situated within the premises or compound of an employer, contractor or
subcontractor and the wor performed therein is under the acti!e or personal super!ision by or for the
latter.
.d/ H'mployerH means any natural or artificial person who, for his own account or benefit, or on behalf
of any person residing outside the +hilippines, directly or indirectly, or through any employee, agent,
contractor, subcontractor, or any other person(
.1/ deli!ers or causes to be deli!ered any goods, articles or materials to be processed or fabricated in
or about a home and thereafter to be returned or to be disposed of or distributed in accordance with his
direction1 or
.2/ sells any goods, articles or materials for the purpose of ha!ing such goods or articles processed in
or about a home and then repurchases them himself or through another after such processing.
.e/ H5ontractorH or HsubcontractorH means any person who, for the account or benefit of an employer,
deli!ers or causes to be deli!ered to a homeworer goods or articles to be processed in or about his home
and thereafter to be returned, disposed of or distributed in accordance with the direction of the employer.
.f/ H+rocessingH means manufacturing, fabricating, finishing, repairing, altering, pacing, wrapping or
handling in any way connected with the production or preparation of an article or material.
.g/ H5ooperati!eH is an association registered under the 5ooperati!e 5ode of the +hilippines.
.h/ H$epartmentH means the $epartment of &abor and 'mployment.
,. registration- "ec : and ;
"'5T0%N :. Registration of Homeworers@ %rgani*ation. ? Any applicant homeworer organi*ation or
association shall ac9uire legal personality, and shall be entitled to the rights and pri!ileges granted by law
to legitimate labor organi*ations upon issuance of the certificate of registration based on the following
re9uirements(
.a/ 2ifty-fi!e +esos .+;;.33/ registration fee1
.b/ The names of its officers, their addresses, the principal address of the homeworers organi*ation,
the minutes of the organi*ational meetings and the list of worers who participated in such meetings1
.c/ The names of all its members comprising at least 23 percent of all the worers in the bargaining
unit where it sees to operate, if applicable1
.d/ 0f the applicant has been in e-istence for one or more years, copies of its annual financial reports1
and
.e/ 2our copies of the constitution and by-laws of the applicant organi*ation, the minutes of its
adoption or ratification and the list of members who participated in it.
"'5T0%N ;. Registration of 'mployer, 5ontractor and "ubcontractor. ? The $epartment shall, as soon as
possible, conduct consultation meetings with go!ernment agencies re9uiring registration of employers and determine if
the data being supplied by the registration forms of such agencies are the same as or similar those needed by the
$epartment in the implementation of this regulations. 0f the registration forms of other agencies do not pro!ide the
data needed by $%&', it shall in9uire into the possibility of adopting a common registration form with other agencies
that will pro!ide the data needed by all the agencies concerned.
:. 5onditions of 'mploymentA $eductions- "ec >-#
"'5T0%N >. "tandard rates. ? At the initiati!e of the $epartment or upon petition of any interested
party, the "ecretary of &abor and 'mployment or his authori*ed representati!e shall establish the
standard output rate or standard minimum rate in appropriate orders for the particular wor or processing
to be performed by the homeworers.
The standard output rates or piece rates shall be determined through any of the following procedures(
.a/ time and motion studies1
.b/ an indi!idualAcollecti!e agreement between the employer and its worers as appro!ed by the
"ecretary or his authori*ed representati!e1
.c/ consultation with representati!es of employers and worers organi*ations in a tripartite
conference called by the "ecretary.
The time and motion studies shall be undertaen by the Regional %ffice ha!ing 6urisdiction o!er the
location of the premiseAs used regularly by the homeworerAs. Howe!er, where the 6ob operation or
acti!ity is being liewise performed by regular factory worers at the factory or premises if the employer,
the time and motion studies shall be conducted by the Regional %ffice ha!ing 6urisdiction o!er the
location of the main undertaing or business of the employer. +iece rates established through time and
motion studies conducted at the factory or main undertaing of the employer shall be applicable to the
homeworers performing the same 6ob acti!ity. The standard piece rate shall be issued by the Regional
%ffice within one month after a re9uest has been made at said office.
)pon re9uest of the Regional %ffice, the Dureau of <oring 5onditions shall pro!ide assistance in the
conduct of such studies.
Non-compliance with the established standard rates can be the sub6ect of complaint which shall be filed at
the Regional %ffice.
"'5T0%N 8. $eductions. ? No employer, contractor, or subcontractor shall mae any deduction from
the homeworer@s earnings for the !alue of materials which ha!e been lost, destroyed, soiled or otherwise
damaged unless the following conditions are met(
.a/ the homeworer concerned is clearly shown to be responsible for the loss or damage1
.b/ the homeworer is gi!en reasonable opportunity to show cause why deductions should not be
made1
.c/ the amount of such deduction is fair and reasonable and shall not e-ceed the actual loss or
damage1 and
.d/ the deduction is made at such rate that the amount deducted does not e-ceed 23K of the
homeworer@s earnings in a wee.
"'5T0%N #. 5onditions for payment of wor.
.a/ The employer may re9uire the homeworer to redo the wor which has been improperly e-ecuted
without ha!ing to pay the stipulated rate again.
.b/ An employer, contractor, or subcontractor need not pay the homeworer for any wor which has
been done on goods and articles which ha!e been returned for reasons attributable to the fault of the
homeworer.
;. +rohibitions
"'5T0%N 1,. +rohibitions for homewor. ? No homewor shall be
performed on the following( .1/ e-plosi!es, firewors and articles of lie
character1 .2/ drugs and poisons1 and .,/ other articles, the processing of which
re9uires e-posure to to-ic substances.
9. Me!i"a#, Denta# an! $""%pationa# sa&et'
a. 2irst Aid Treatment
ART. 1;7. !irst-aid treat2ent. - '!ery employer shall eep in his establishment such first-aid medicines
and e9uipment as the nature and conditions of wor may re9uire, in accordance with such regulations as
the $epartment of &abor and 'mployment shall prescribe.
The employer shall tae steps for the training of a sufficient number of employees in first-aid treatment.
b. 'mergency Fedical and $ental "er!ices
1. <hen re9uired
ART. 1;>. 92ergenc- 2edical and dental services. - 0t shall be the duty of e!ery employer to furnish his
employees in any locality with free medical and dental attendance and facilities consisting of(
.a/ The ser!ices of a full-time registered nurse when the number of employees e-ceeds fifty .;3/
but not more than two hundred .233/ e-cept when the employer does not maintain ha*ardous
worplaces, in which case, the ser!ices of a graduate first-aider shall be pro!ided for the
protection of worers, where no registered nurse is a!ailable. The "ecretary of &abor and
'mployment shall pro!ide by appropriate regulations, the ser!ices that shall be re9uired where
the number of employees does not e-ceed fifty .;3/ and shall determine by appropriate order,
ha*ardous worplaces for purposes of this Article1
.b/ The ser!ices of a full-time registered nurse, a part-time physician and dentist, and an
emergency clinic, when the number of employees e-ceeds two hundred .233/ but not more than
three hundred .,33/1 and
.c/ The ser!ices of a full-time physician, dentist and a full-time registered nurse as well as a dental
clinic and an infirmary or emergency hospital with one bed capacity for e!ery one hundred .133/
employees when the number of employees e-ceeds three hundred .,33/.
0n cases of ha*ardous worplaces, no employer shall engage the ser!ices of a physician or a
dentist who cannot stay in the premises of the establishment for at least two .2/ hours, in the
case of those engaged on part-time basis, and not less than eight .8/ hours, in the case of those
employed on full-time basis. <here the undertaing is non-ha*ardous in nature, the physician and
dentist may be engaged on retainer basis, sub6ect to such regulations as the "ecretary of &abor
and 'mployment may prescribe to insure immediate a!ailability of medical and dental treatment
and attendance in case of emergency. .As amended by +residential $ecree N%. ;>3-A, "ection
27/.
2. <hen not re9uired
ART. 1;8. W'en e2ergenc- 'ospital not re=uired. - The re9uirement for an emergency hospital or dental
clinic shall not be applicable in case there is a hospital or dental clinic which is accessible from the
employer=s establishment and he maes arrangement for the reser!ation therein of the necessary beds
and dental facilities for the use of his employees.
c. 'mployer Assistance- %bligation
ART. 171. Assistance of e2plo-er. - 0t shall be the duty of any employer to pro!ide all the necessary
assistance to ensure the ade9uate and immediate medical and dental attendance and treatment to an
in6ured or sic employee in case of emergency.
d. %ccupational "afety and health standards training of super!isorsAtechnicians
Doo ,, Rule 2
"'5T0%N ;. Training of personnel in safety and health. ? '!ery employer shall tae steps to train a
sufficient number of his super!isors or technical personnel in occupational safety and health. An employer
may obser!e the following guidelines in the training of his personnel(
.a/ 0n e!ery non-ha*ardous establishment or worplace ha!ing from fifty .;3/ to four hundred .:33/
worers each shift, at least one of the super!isors or technical personnel shall be trained in occupational
health and safety and shall be assigned as part-time safety man. "uch safety man shall be the secretary
of the safety committee.
.b/ 0n e!ery non-ha*ardous establishment or worplace ha!ing o!er four hundred .:33/ worers per shift,
at least two of its super!isors shall be trained and a full-time safety man shall be pro!ided.
.c/ 0n e!ery ha*ardous establishment or worplace ha!ing from twenty .23/ to two hundred .233/ worers
each shift, at least one of it super!isors or technical man shall be trained who shall wor as part-time
safety man. He shall be appointed as secretary of the safety committee therein.
.d/ 0n e!ery ha*ardous establishment or worplace ha!ing o!er two hundred .233/ worers each shift, at
least two of its super!isors or technical personnel shall be trained and one of them shall be appointed full-
time safety man and secretary of the safety committee therein.
.e/ The employment of a full-time safety man not be re9uired where the employer enters into a written
contract with a 9ualified consulting organi*ation which shall de!elop and carry out his safety and health
acti!ities1 +ro!ided, That the consultant shall conduct plant !isits at least four .:/ hours a wee and is
sub6ect to call anytime to conduct accident in!estigations and is a!ailable during scheduled inspections or
sur!eys by the "ecretary of &abor and 'mployment or his authori*ed representati!es.
The pro!isions of this "ection shall be made mandatory upon orders of the "ecretary of &abor and
'mployment as soon as he is satisfied that ade9uate facilities on training in occupational safety and
health are a!ailable in the $epartment of &abor and 'mployment and other public or pri!ate entities duly
accredited by the "ecretary of &abor and 'mployment.
(((. )*p#o'ee C#assi&i"ation
Reference( Doo 7, Rule 1
"'5T0%N ;. Regular and casual employment. ? .a/ The pro!isions of written agreements to the contrary
notwithstanding and regardless of the oral agreements of the parties, an employment shall be considered
to be regular employment for purposes of Doo C0 of the &abor 5ode where the employee has been
engaged to perform acti!ities which are usually necessary or desirable in the usual business or trade of
the employer e-cept where the employment has been fi-ed for a specific pro6ect or undertaing the
completion or termination of which has been determined at the time of the engagement of the employee
or where the wor or ser!ice to be performed is seasonal in nature and the employment is for the duration
of the season.
.b/ 'mployment shall be deemed as casual in nature if it is not co!ered by the preceding paragraph1
+ro!ided, That any employee who has rendered at least one year of ser!ice, whether such ser!ice is
continuous or not, shall be considered a regular employee with respect to the acti!ity in which he is
employed and his employment shall continue while such acti!ity e-ists.
.c/ An employee who is allowed to wor after a probationary period shall be considered a regular
employee.
"'5T0%N 7. +robationary employment. ? .a/ <here the wor for which an employee has been engaged is
learnable or apprenticeable in accordance with the standards prescribed by the $epartment of &abor, the
probationary employment period of the employee shall be limited to the authori*ed learnership or
apprenticeship period, whiche!er is applicable.
.b/ <here the wor is neither learnable nor apprenticeable, the probationary employment period shall not
e-ceed si- .7/ months reconed from the date the employee actually started woring.
.c/ The ser!ices of an employee who has been engaged on probationary basis may be terminated only for
a 6ust cause or when authori*ed by e-isting laws, or when he fails to 9ualify as a regular employee in
accordance with reasonable standards prescribed by the employer.
.d/ 0n all cases in!ol!ing employees engaged on probationary basis, the employer shall mae nown to
the employee the standards under which he will 9ualify as a regular employee at the time of his
engagement.
1. co!erage
ART. 2>8. Coverage. - The pro!isions of this Title shall apply to all establishments or undertaings,
whether for profit or not.
2. employee classification
ART. 283. Regular and casual e2plo-2ent. - The pro!isions 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 acti!ities which are usually necessary or
desirable in the usual business or trade of the employer, e-cept where the employment has been fi-ed for
a specific pro6ect or undertaing the completion or termination of which has been determined at the time
of the engagement of the employee or where the wor or ser!ice 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 co!ered by the preceding paragraph( +ro!ided,
That any employee who has rendered at least one year of ser!ice, whether such ser!ice is continuous or
broen, shall be considered a regular employee with respect to the acti!ity in which he is employed and
his employment shall continue while such acti!ity e-ists.
ART. 281. #ro$ationar- e2plo-2ent. - +robationary employment shall not e-ceed si- .7/ months from the
date the employee started woring, unless it is co!ered by an apprenticeship agreement stipulating a
longer period. The ser!ices of an employee who has been engaged on a probationary basis may be
terminated for a 6ust cause or when he fails to 9ualify as a regular employee in accordance with
reasonable standards made nown by the employer to the employee at the time of his engagement. An
employee who is allowed to wor after a probationary period shall be considered a regular employee.
a. employer recognition
Ro*ares vs NLRC, 199+
2acts(
+etitioner wored as a mason for +0&F05%, a company engaged in the production of flour, yeast, feeds
amd other flour products.
<as rehired after ser!ice of more than a year and assigned to the FaintenanceApro6ectsA'ngineering
department where he performed( painting, cleaning and operating machines, assisting other employees in
their maintenance wors.
%n Ganuary 1;, 1##,, his ser!ices was terminated and company said it was due to e-piration of contract
as temporary worer.
0ssue( <%N petitioner is a regular worer
Held( Ees
Ratio(
1. 0f an employee performs wor which is usually necessary or desirable in the usual business or
trade of the employer, then he is a regular employee.
2. 5ontinuing need for the ser!ices of petitioner is sufficient e!idence of the necessity and
indispensability of his ser!ices.
,. T uphold otherwise( permit employer to a!oid hiring permanent or regular employees by simply
hiring them on a temporary or casual basis, thereby !iolating the employee=s security of tenure in
their 6obs.
Drent "chool !s Lamora(
1. where from the circumstances it is apparent that the periods ha!e been imposed to preclude
ac9uisition of tenurial security by the employee, they should be struc down or disregarded as
contrary to public policy and morals.
2. Term employment is !alid in relation to security of tenure if(
a. the fi-ed period of employment was nowingly and !oluntarily agreed upon by the parties
without any force, duress or improper pressure being brought to bear upon the employee
and absent any other circumstance !itiating his consent or
b. it satisfactorily appears that the employer and the employee dealt with each other on
more or less e9ual terms with no moral dominance e-ercised by the former or the latter.
,i##a vs. NLRC, 9+
2acts(
0n line with its billet steel maing pro6ect, N"5 aimed to use 133K scrap as its raw materials and thus
engaged in shipbreaing operations.
<hen pro6ect was completely phased out due to scarcity of !esselsAships for sal!aging, the laborers hired
as pro6ect employees for said pro6ect were terminated.
5ompany( laborers were pro6ect employees
0ssue( <%N worers contracted as pro6ect employees may be considered as regular employees on
account of their performance of duties inherent in the business of the employer
Held( N%
Ratio(
1. The fact that they performed other acti!ities which were necessary or desirable in the usual
business of the N"5 and that the duration of their employment e-ceeded 1 year, does not mae
them regular employees.
2. &ength of ser!ice is not the controlling determinant of the employment tenure of a pro6ect
employee.
,. 283 pro!iding that an employee who has ser!ed for at least 1 year, shall be considered a regular
employee, relates only to casual employees and not to pro6ect employees.
:. +ro6ect employment contracts are !alid( employer=s interest propels economic acti!ity
b. employer determinationAdesignation
Philippine Federation vs NLRC, 1998
-a"ts.
0n "ept., 1#82, Cictoria Abril was employed by +2550, a corp. engaged in organi*ing ser!ices to credit
M cooperati!e entities, as Gunior AuditorA2ield '-aminer and therefore held different positions e.g. as
office secretary M cashier until April 1#88.
Abril went on maternity lea!e M returned only in No!. 1#8# where she found out that "antos had been
permanently appointed to her position.
"he then accepted the position of Regional 2ield %fficer which, as stated in the contract, shall be
probationary for a period of 7 mos.
+eriod elapsed M Abril was allowed to wor until +2550 presented to her another employment contract
for a period of 1 year .Gan 1##1-$ec 1##1/.
After which period, her employment was terminated.
"he filed a complaint for illegal dismissal but &A dismissed the same for lac of merit.
N&R5 re!ersed M directed +2550 to reinstate Abril to position of Regional 2ield %fficer.
+2550 appealed.
(SS/). <%N there was indeed illegal dismissal of Abril
0e#!. Ees
Ratio.
Contention o& P-CC( that Abri# is a "as%a# or "ontra"t%a# e*p#o'ee is *isp#a"e!.
-<hile the initial statements of the contract show that Abril was hired for a fi-ed period, the ne-t
pro!isions thereof contradicted the same when it pro!ided that respondent shall be under
probationary status from 2eb 1##3 N 7 mos thereafter.
- Also, while +2550 fi-ed the period of employment for 1 year, it liewise insisted that Abril was
employed to perform wor related to a pro6ect funded by the <orld 5ouncil of 5redit )nions M
hence her status is a pro6ect employee.
- 0n this case, the terms of the contract are so ambiguous as to preclude a precise application of
the pertinent labor laws. 0n Cillanue!a !s. N&R5, "5 ruled that where a contract of employment,
being a contract of adhesion, is ambiguous, any ambiguity therein should be construed strictly
against the party who prepared it.
NLRC &o%n! that Abri# be"a*e a reg%#ar e*p#o'ee entit#e! to se"%rit' o& ten%re
g%arantee! %n!er the Consti 1 #abor #a2s.
- 0t is uncontro!erted that Abril, ha!ing completed the probationary period M allowed to wor
thereafter, became a regular employee who may be dismissed only for 6ust or authori*ed causes
under Arts. 282, 28,, M 28: of the &abor 5ode. Therefore, the dismissal, premised on the
allegation of the e-piration of the contract, is illegal M entitles respondent to the reliefs prayed for.
#etition dis2issed.
De Leon vs NLRC, 89
-a"ts.
$e &eon was employed by &a TondeJa, 0nc. on $ec. 11, 1#81 at the Faintenance "ection of its
'ngineering $epartment in Tondo, Fanila where his wor consisted mainly of painting M other odd 6obs
related to maintenance. He was paid on a daily basis through petty cash !ouchers.
After more than 1 year of ser!ice, $e &eon re9uested to be included in the payroll of regular worers.
5ompany=s response was to dismiss him from his employment.
$e &eon demanded reinstatement but company refused repeatedly.
$e &eon filed a complaint for illegal dismissal, reinstatement M payment of bacwages to the %ffice of
the &A.
<ees after, he was rehired by the company through a labor agency M was returned to his post in the
Faintenance "ection M made to perform the same acti!ities.
&A found for $e &eon M declared the dismissal as illegal. He ruled that $e &eon was not a mere casual
employee as asserted by pri!ate respondent but a regular employee.
%n appeal, N&R5 re!ersed the decision of the &A. Fotion for recon was denied. Hence, this appeal.
(SS/)( <%N $e &eon was mere casual employee
0e#!. N$, re!ersal of the decision was erroneous
Ratio.
)nder Art. 281 of the &5, the primary standard of determining a regular employment is the reasonable
connection bet. the particular acti!ity performed by the employee in relation to the usual business or
trade of the employer. Also, if the employee has been performing the 6ob for at least 1 year, e!en if the
performance is not continuous or merely intermittent, the law deems the repeated M continuing need
for its performance as sufficient e!idence for the necessity if not indispensability of that acti!ity to the
business.
0n this case, the records re!eal that $e &eon=s tass assigned to him included not only the painting of
building as claimed by the respondent but also cleaning M oiling machines, e!en operating a drilling
machine M other odd 6obs.
- A regular employee, Tan9ue, attested in his affida!it that $e &eon wored wA him as
maintenance man when there was no painting 6ob.
- 0n its comment, company confirmed the !eracity of $e &eon=s claim when it admitted that he
was occasionally instructed to do other odd things in connection wA the maintenance while he was
waiting for materials he would need in his 6ob or when he had finished early the one assigned to
him
The law demands that the nature M entirety of the acti!ities performed by the employee be
considered.
2urthermore, the petitioner performed his wor of painting M maintenance acti!ities during his
employment which lasted for more than 1 year, until early Gan., 1#8, when he demanded to be
regulari*ed but was dismissed.
The fact that he was rehired wees after shows that it can not be denied that his acti!ities as regular
painter M maintenance man still e-ist.
What !eter*ines 2hether a "ertain e*p#o'*ent is reg%#ar or "as%a# is not the 2i## 1 2or!
o& e*p#o'er to 2hi"h the !esperate 2or3er o&ten a""e!es nor the pro"e!%re o& hiring or
*anner o& pa'*ent o& sa#ar'. (t is the nat%re o& the a"tivities per&or*e! in re#ation to the
parti"%#ar b%siness or tra!e "onsi!ering a## "ir"%*stan"es, 1 in so*e "ases the #ength o&
ti*e o& its per&or*an"e 1 its "ontin%e! existen"e. There was an ob!ious de!ious dismissal of $e
&eon to e!ade the obligations of petitioner to the worer.

Petition granted.
Violeta vs NLRC, 97
Cioleta M Dalta*ar were former employees of $asmariJas 0ndustrial M "teelwors 5orp. .$0"5/. Cioleta
was hired by $0"5 as 'rector 00 for +hilphos pro6ect M was subse9uently reassigned to the same
position in the ; "tand T5F +ro6ect <A !acation M sic lea!es M was designated as a regular pro6ect
employee At $0"5=s pro6ect for Nat=l "teel 5orp.
He was appointed for pro6ect employment as handyman for N"5 pro6ect M afterwards for the N"5 'T&
O, 5i!il <ors by $0"5. $ue to the completion of the particular item of wor, $0"5 terminated his
ser!ices on Farch =#2.
%n the other hand, Dalta*ar was hired as &ead 5arpenter for pro6ect Agua C00 on %ct =81. &ie, Cioleta,
he was then transferred from one pro6ect to another as regular pro6ect employee. He was also hired as
&eadman 00 in 'T& O, 5i!il <ors but was separated from employment on $ec =#1 as a result of the
completion of the said item of wor.
+etitioners filed a complaint for illegal dismissal claiming that they are regular employees who cannot
be dismissed on the ground of completion of the pro6ect where they are engaged with a prayer for
reinstatement M bacwages.
&A dismissed for lac of merit but ordered $0"5 to grant them separation pay. He concluded that
petitioners are pro6ect employees based on their own admission.
N&R5 re!ersed, finding them to be non-pro6ect employees. Howe!er, the same di!ision of N&R5
re!ersed itself upon motion of $0"5 M set aside its earlier decision.
(SS/). <%N petitioners are pro6ect
employees
0e#!. No, they are regular employees
Ratio.
Although there is no dispute that petitioners were hired for a specific pro6ect M the same is already
completed, the records are barren of any definite period or duration for the e-piration of the assigned
items of wor at the time of their engagement.
-An e-amination of the appointments re!eals that the completion of the pro6ect for which the
petitioners were hired was not determined at the start of their employment. 0n fact, the lines for
P$AT' %2 5%C'RA4'Q in the appointments are left blan.
-<hile Pco-terminusQ was used, it still cannot be said that their employment is for a definite period
because there are other words used in the same appointments affecting their entitlement to stay
in the 6ob. 0t is stated that the appointments of the petitioners were not co-terminus wA N"5 'T&
O, but with the PneedQ for such particular items of wor as were assigned to them, as
distinguished from the completion of the pro6ect.
-<A such ambiguous M obscure words M conditions, petitioner=s employment was not co-e-istent
wA the duration of their particular assignments bec. their employer could determine, at any stage,
whether their ser!ices were needed or not.
Also, nowhere in the records is there any showing that $0"5 reported the completion of its pro6ects M
the dismissal of petitioners in its finished pro6ects to the nearest +ublic 'mployment %ffice in
compliance with +olicy 0nstruction No.23 of then &abor "ecretary Dlas 2. %ple.
- 0ts failure to submit reports of termination cannot be sufficiently con!ince us further that
petitioners are truly regular employees.
The fact that petitioners had rendered more than 1 year of ser!ice .at least 13 years/ o!erturns
pri!ate respondents allegations that petitioners were hired for a specific or fi-ed undertaing for a
limited period of time.
* Although there are gaps in the employment, Art. 283 contemplates both continuous M
broen ser!ices. Also, there is absolutely no e!idence their ha!ing applied for or accepted
other outside employment during the brief interruption in the continuity of their wor.
Petition Granted
A. Regular employees
283, 1
st
par.
The pro!isions 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 acti!ities which are usually necessary or desirable in the usual business or trade of the employer,
e-cept where the employment has been fi-ed for a specific pro6ect or undertaing the completion or
termination of which has been determined at the time of the engagement of the employee or where the
wor or ser!ice to be performed is seasonal in nature and the employment is for the duration of the
season.
283, 2
nd
paragraph
An employment shall be deemed to be casual if it is not co!ered by the preceding paragraph( +ro!ided,
That any employee who has rendered at least one year of ser!ice, whether such ser!ice is continuous or
broen, shall be considered a regular employee with respect to the acti!ity in which he is employed and
his employment shall continue while such acti!ity e-ists.
281, last sentence
An employee who is allowed to wor after a probationary period shall be considered a regular employee.
>;.d/ &earnership agreement
.d/ A commitment to employ the learners if they so desire, as regular employees upon completion of the
learnership. All learners who ha!e been allowed or suffered to wor during the first two .2/ months shall
be deemed regular employees if training is terminated by the employer before the end of the stipulated
period through no fault of the learners.
The learnership agreement shall be sub6ect to inspection by the "ecretary of &abor and 'mployment or his
duly authori*ed representati!e.
Doo 7, Rule 1.
"ec ; a.
The pro!isions of written agreements to the contrary notwithstanding and regardless of the oral
agreements of the parties, an employment shall be considered to be regular employment for purposes of
Doo C0 of the &abor 5ode where the employee has been engaged to perform acti!ities which are usually
necessary or desirable in the usual business or trade of the employer e-cept where the employment has
been fi-ed for a specific pro6ect or undertaing the completion or termination of which has been
determined at the time of the engagement of the employee or where the wor or ser!ice to be performed
is seasonal in nature and the employment is for the duration of the season.
.b/ 'mployment shall be deemed as casual in nature if it is not co!ered by the preceding paragraph1
+ro!ided, That any employee who has rendered at least one year of ser!ice, whether such ser!ice is
continuous or not, shall be considered a regular employee with respect to the acti!ity in which he is
employed and his employment shall continue while such acti!ity e-ists.
"'5T0%N 7. +robationary employment. ? .a/ <here the wor for which an employee has been engaged is
learnable or apprenticeable in accordance with the standards prescribed by the $epartment of &abor, the
probationary employment period of the employee shall be limited to the authori*ed learnership or
apprenticeship period, whiche!er is applicable.
.b/ <here the wor is neither learnable nor apprenticeable, the probationary employment period shall not
e-ceed si- .7/ months reconed from the date the employee actually started woring.
.c/ The ser!ices of an employee who has been engaged on probationary basis may be terminated only for
a 6ust cause or when authori*ed by e-isting laws, or when he fails to 9ualify as a regular employee in
accordance with reasonable standards prescribed by the employer.
.d/ 0n all cases in!ol!ing employees engaged on probationary basis, the employer shall mae nown to
the employee the standards under which he will 9ualify as a regular employee at the time of his
engagement.
1. nature of wor
!al vs. NLRC, 91
-a"ts.
+etitioners were employed by Hi-&ine Timber, 0nc starting from 2eb-Fay R87. They were all recei!ing
their salaries M were re9uired to wor >daysAwee inc. rest days, holidays e-cept 5hristmas M 4ood
2riday. They were not gi!ing li!ing allowance, o!ertime M premium pay M on Gune =8> they were not
allowed to wor M instead were informed that their ser!ices were no longer needed.
Hi-&ine, on the other hand, denied the e-istence of the employer-employee relationship bet. The
company M the petitioners claiming that the latter are under the employ of an independent contractor.
Hi-&ine claimed that 'cal was an independent contractor as the latter chooses the worers and not Hi-
&ine. Also, they were not included in the payroll but a lump sum money was gi!en to 'cal e!ery : days.
&A dismissed the complaint for illegal dismissal M ruled that there was no employer-employee
relationship bet. the parties.
%n appeal, N&R5 affirmed the decision.
(SS/).<%N employer-employee relat=nship e-ists bet. the parties
0e#!. 4es
Ratio.
An obser!ation suggests that there is a certain relationship e-isting between the parties although a
clear-cut characteri*ation of such relationship is una!ailing.
Adopting the theory of the "ol 4en M the respondent, 'cal could not be an independent contractor
under Art 137 par 1 M2 of the &5 but a labor-only contractor under "ec. #, Rule 8, Doo , of the
%mnibus Rules of the &5. 'cal was only a poor laborer at the time of his resignation on 2eb =8> who
cannot e!en afford to ha!e his daughter treated for malnutrition. He was only a laborer at the iln
drying section for the company M could not ha!e the substantial capital or in!estment that is re9uired
of a 6ob contractor.
A finding that 'cal is a R contractor labor-only= is e9ui!alent to a finding that an employer-employee
relationship e-ists bet. the company M 'cal including the latter=s contract worers .petitioners/, the
relationship being pro!ided by the law itself.."ec.# .b/ of the %mnibus Rules/
5ourt frowns upon the company policy of limiting the undertaing to : days presumably to mae
termination of the ser!ices of the petitioners easier M to pre!ent them from attaining permanent
status. Hi-&ine had no doubt too ad!antage of these laborers in order to escape the liability for
benefits M pri!ileges accruing to one holding a regular employment.
De!ision reversed " set aside.
Dat% vs NLRC, 596
-a"ts.
Felanio M 2lorendo were hired by $atu M 5o. as plumbers in Gune =>#.
%n Guly =#1, company through "alera issued a memorandum which too note of the fact that
petitioners were not woring and in connection with this, pro6ect in-charge was instructed to mae
petitioners report to the office to settle their salaries as "alera would not lie to see them in the pro6ect
anymore lest they stay in the worer=s 9uarters. "alera also deemed them absent M canceled their
name in the daily time record.
0n defense, petitioners allege that their non-woring was made in protest of the undue delay in the
payment of their salaries. They also construed the memorandum as a termination order. They then
filed wA $%&' a complaint for illegal dismissal M non-payment of salaries.
&A ruled in fa!or of petitioners and upon appeal by $atu M 5o., N&R5 affirmed the decision M added
the grant of bacwages in addition to separation pay.
0"")'( <%N petitioners were in fact terminated
Held( Ees
Ratio(
5ontrary to company=s claim that the 2 were merely being transferred to another pro6ect, they were
in fact terminated as there was a need to settle their salaries. 0f it were so, petitioner should ha!e
re9uired the worers to e-plain why they did not wor full time rather than issue the 9uestioned
memorandum. Also, the statement, P0 would not lie to see them in this pro6ect anymore lest they
stay in the worer=s 9uartersQ could only lead to this conclusion since they were admittedly barred
from reporting to their place of wor by $atu=s security guards.
Also, no word implying reassignment can be discerned in the said memorandum. Neither does it
mention the pro6ect to which they shall be reassigned.
0"")' O2( <%N pri!ate respondents were pro6ect employees
Held( N%
Ratio(
0t cannot be denied that they had been performing acti!ities which were necessary or desirable in
the construction business of petitioner. Respondents were hired as plumbers for more than a decade
by petitioner. There was no e!idence that respondent=s employment was fi-ed for only a specific
pro6ect.
0n fact, they were assigned from 1 pro6ect to another for a period of 12 years wAo any appreciable
gap between the last pro6ect M the succeeding one.
-This fact argues persuasi!ely for the e-istence of a wor pool in the petitioner=s establishment
from which the company drew its pro6ect employees among whom were the respondents.
- it is also ob!ious that they were not hired in connection wA a particular pro6ect because if this
were so, the completion of the pro6ect would necessarily ha!e the effect of terminating their
ser!ices automatically.
%n the issue of bacwages, although respondents failed to claim them in their complaint, this is only a
procedural lapse which cannot defeat a right which is granted to them under a substanti!e law as such
they are still entitled to recei!e bacwages including their separation pay in lieu of reinstatement.
#ns$lar Li%e vs NLRC, 98
0nsular and +antaleon de los Reyes entered into an agency contract authori*ing the latter to solicit
applications for life insurance and annuities for which he would be paid compensation in the form of
commission. 5ontract stipulated that there would be no '' relationship between them.
&ater, they entered into another contract where Reyes was appointed as Acting )nit manager under its
officeS5'D) $"% C.
recruitment, training, organi*ation and de!elopment of underwriters
super!ise the wors of these underwriters
contract( acting unit manager and the agents of his unit to the company shall be that of independent
contractor.
$e los Reyes wored concurrently as agent and acting unit manager until he was notified that his ser!ices
were terminated.
0ssue( <%N he was a regular employee
Held( yes
Ratio(
1. '' relationship insofar as his role as acting unit manager despite contract stipulation that he was
independent contractor( employment status of person is defined and prescribed by law and not by
what the parties say it shud be.
2. manifestations of '' relationship(
e-clusi!ity of ser!ice
control of assignments
collection of premiums
furnishing of company facilities and materials as well as capital described as )nit de!elopment 2und
. Gan&on #n! vs NLRC, 1999
22 employees of '. 4an*on 0nc, a company engaged in the construction business .manufactures own
building materials/, filed a complaint against company for illegal deduction, nonpayment of o!ertime pay,
legal holiday pay, premium pay, "0&+, !acationAsic lea!e pay, and 1,
th
month pay.
After that, when they reported on Gan 2;, 1##1, the security guard informed them( Hindi na ayo puedeng
pumasoAmagtrabaho dito, Ryan ang order galling sa itaas.=
5ompany=s defense( they were all contractual, pro6ect, temporary or casual employees.
0ssue( <on they were regular employees
Held( Ees
Ratio(
1. respondents performed tass usually necessary or desirable in the usual business or trade of
company(
machinist
machinist operator
electrical engineer
aluminum installer
etc
2. contracts( as pro6ect employees but were renewed e!ery , months?successi!e contracts where
they performed same ind of wor maes it clear that they were performing necessary and
desirable tass.
,. also( if they were pro6ect employees, employer should ha!e submitted report of termination to
+)D&05 'F+&%EF'NT %2205' e!ery time their employment was terminated due to completion of
each construction pro6ect
2. e-tended period
6o*as Lao Constr%"tion vs NLRC, 59+
2acts(
5omplainants were construction worers in different capacities for the &ao group of 5ompanies(
T&5( Tomas &ao 5orporation
TMG( Thomas and Games $e!elopers
&CF( &CF 5onstruction 5orporation
* construction of public roads and bridges
* each would allow the utili*ation of their employees by the other 2.
"oon after, T&5 ceased operation so Andres &ao issued a memo re9uiring all worers to sign employment
contract forms and clearances.
<orers refused to sign beco* contracts e-pressly described them as pro6ect employees whose
employments were for a definite period i.e. upon the e-piration of the contract period or the completion of
the pro6ect for which the worers were hired.
5o* of refusal to comply with directi!es, their ser!ices were terminated.
0ssue( <%N they were regular employees.
Held( E'"
Ratio(
1. repeated rehiring and continuing need for their ser!ices o!er a long span of time .shortest, at >
years/ made them regular employees
2. employments became non-coterminous with specific pro6ects when they started to be
continuously rehired
,. also( failure of employer to file termination reports pro!es that the employees are not pro6ect
employees
:. no will disobedience( absent ff re9uirement(
a. employee=s conduct must ha!e been willful or intentional, the willfulness being
characteri*ed by a wrongful and per!erse attitude
b. the order !iolated must ha!e been reasonable, lawful, made nown to the employee and
must pertain to the duties which he has been engaged to discharge
,. repeated Renewal of 5ontract
7eta )#e"tri" Corp vs NLRC, 598
2acts(
+etitioner hired pri!ate respondent as cler typist , on $ecember 1;, 1#87 and was renewed ; times til
Gune 1, 1#8>.
%n Gune 22, 1#8>, her ser!ices were terminated without notice or in!estigation and company claimed that
she was hired on a temporary basis for purposes only of meeting the seasonal or pea demands of the
business.
0ssue( <on she was regular employee
Held( yes
Ratio(
1. contract-to-contract arrangement was to pre!ent her from ac9uiring security of tenure
2. at the !ery least, she should be considered a probationary employee( tenure ha!ing e-ceeded 7
months, she attained regular employment
0. The fact that she had been employed purportedly for the simple purpose of unclogging the
petitioner=s files does not mae such undertaing specific from the standpoint of law because in
the 1
st
place, it is usually necessary and desirable in he usual business or trade of employer.
;. 'nforcement
77. Appeal to the "ecretary of &abor
The decision of the authori*ed agency of the $epartment of &abor may be appealed by any
aggrie!ed person to the "ecretary of &abor
within ; days from receipt of the decision
which shall be final and e-ecutory.
7>. '-haustion of administrati!e remedies
Defore a person may institute any action
for the enforcement of any apprenticeship agreement or
damages for breach of any such agreement
"ee also( 5hild Abuse &aw of 1##2 as amended by RA >7;8
"ection 12. 'mployment of 5hildren- 5hildren below 1; years old shall not be employed e-cept(
1. when a child wors directly under the sole responsibility of his parents or legal guardian and
where only members of the employer=s family are employed. +R%C0$'$, H%<'C'R,
a. that his employment neither endangers his life, safety, health and morals, nor impairs his normal
de!elopment
b. that the parent or legal guardian shall pro!ide the minor child with the prescribed primary andAor
secondary education.
2. when a child=s employment or participation in public and entertainment or information through
cinema, theater, radio or tele!ision is essential. +R%C0$'$(
a. the employment contract is concluded by the child=s parents or guardian with the e-press
agreement of the child concerned, if possible, and the appro!al of the $%&'
b. that the following re9uirements in all instances are strictly complied with(
employer shall ensure the protection, health, safety and morals of the child
employer shall institute measures to pre!ent the child=s e-ploitation or discrimination taing into
account the system and le!el of remuneration and the duration and arrangement of woring time
employer shall formulate and implement, sub6ect to the appro!al and super!ision of competent
authorities, a continuing program for the training and sills ac9uisition of the child
Defore child is employed, employer shall first secure a wor permit from the $%&', which shall ensure
obser!ance of the abo!e re9uirements.
The $%&' shall promulgate rules and regulations necessary for the effecti!e implementation of this
section.
c. $isabled +ersons .Handicapped <orers/
>8. $efinition- those whose earning capacity is impaired by age or physical or mental deficiency or in6ury.
>#. <hen employable
when their employment is necessary to pre!ent curtailment of employment opportunities and
when it does not create unfair competition in labor costs or
impair or lower woring standards
83. 'mployment agreement
a. names and address of the worers to be employed
b. rate to be paid which shall be not less than >;K of the applicable minimum wage
c. duration of the employment period
d. wor to be performed
The agreement shall be sub6ect to inspection by the "ecretary of &abor or his reps.
81. 'ligibility of apprenticeship-
may be hired as apprentices or learners
if their handicap is not such as to effecti!ely impede the performance of 6ob operations in the
particular occupations for which they are hired
1. $efinition
"ection :.
a. disabled persons- those suffering from restriction or different abilities, as a result of a mental,
physical or sensory impairment, to perform an acti!ity in the manner or within the range considered
normal for a human being
b. impairment- any loss, diminution or aberration of psychological, physiological or anatomical
structure or function
c. disability- shall mean
1. physical or mental impairment that substantially limits one or more psychological, physiological or
anatomical function of an indi!idual or acti!ities of such indi!idual
2. a record of such an impairment or
,. being regarded as ha!ing such an impairment
d. handicap- refers to a disad!antage for a gi!en indi!idual resulting from an impairment or a
disability that limits or pre!ents the function or acti!ity, that is considered normal gi!en the age and
se- of the indi!idual
2. +olicy declaration
"ection 2.
,. 5o!erage
all disabled persons
and to the e-tent herein pro!ided
departments
offices and agencies of the National 4o!ernment
N4%s
0n!ol!ed in the attainment of the ob6ecti!es of this Act.
:. Rights and +ri!ileges
"ection ;. '9ual %pportunity for 'mployment
No disabled person shall be denied access to opportunities for suitable employment. A 9ualified
disabled employee shall be sub6ect to the same terms and conditions of employment and the same
compensation, pri!ileges, benefits, fringe benefits, incenti!es or allowances as a 9ualified able bodied
person.
Bernardo vs NLRC G !9B;C, +1& SCRA 1/0 5..6
Nature( "pecial 5i!il Action in the "upreme 5ourt. 5ertiorari
2acts(
:, deaf mutes were hired by 2ar 'ast Dan and Trust 5o as Foney "orters and 5ounters. &ater,
they were dismissed from their positions and ban reasoned that since they were not regular employees,
their complaint for illegal dismissal does not ha!e merit.
0ssue( <%N they could be considered regular employees
Held( Ees, but only the 2> employees who wored for more than 7 months and whose contracts were
renewed
Ratio(
tass were necessary and desirable to the business of respondent ban .test( de &eon !s N&R5/
Test( .&T $atu !s N&R5( employee is regular because of the nature of wor and the length of
ser!ice, not because of the mode or e!en the reason for hiring them/
remo!ed under Article 83 co* it was shown that they were 9ualified to perform the responsibilities
of their positions
when ban renewed contract after lapse of 7-month probationary period, the employees became
regular employees
Drent "chool !s Lamora- NA co* they were 9ualified
Dac wages and separation feeT
9. Con!itions o& )*p#o'*ent
A. H%)R" %2 <%RB
1. Regulation1 Rationale
@anila ;er2inal Co. 1nc vs C1R, .1 #'il 02% 5%26
Nature( +etition for re!iew by certiorari of a decision of the 50R
2acts(
"ome ,3 watchmen were hired by the Fanila Terminal 5ompany 0nc on 12-hour shifts. This was
pursuant to their assumption of arrastre ser!ice in some of the piers in Fanila=s +ort Area at the re9uest
and under the control of the )" Army.
Howe!er, worers were not properly granted o!ertime pay as is re9uired by sections , and ; of 5A
::: and the 'ight-Hour &aw.
0ssue( <%N agreement of the employees as to inade9uate compensation constitutes a wai!er to their
right to o!ertime pay
Held( N%
Ratio(
laborers cannot wai!e their right to e-tra compensation
laborer is in a disad!antageous position as to be naturally reluctant in asserting any claim which
may cause the employer to de!ise a way for e-ercising his right to terminate the employment
Rationale for regulation( to safeguard the health and welfare of the laborer
To minimi*e unemployment by forcing employers, in cases where more than 8-hour operation is
necessary, to utili*e different shifts of laborers or employees woring only for 8 hours each.
2. 5o!erage
82. The pro!isions of this tile shall apply to employees
in all establishments and undertaings whether for profit or not,
but not to(
go!ernment employees
managerial employees
field personnel
members of the family of the employer who are dependent on him for support
domestic helpers
persons in personal ser!ice of another and
worers who are paid by results as determined by the "ecretary of &abor in appropriate
regulations.
Fanagerial employees- those whose primary duty consists of the management of the
establishment in which they are employed or of a department of subdi!ision thereof, and to other
officers or members of the managerial staff.
2ield personnel- non-agricultural employees who regularly perform their duties away from the
principal place of business or branch office of the employer and whose actual hours or wor in the
field cannot be determined with reasonable certainty.
'-emptions(
a. go!ernment employees
b. managerial employees
4nternational 5harmaceuticals 4nc. vs ,R), %&" S)RA 331 (&'(
Nature( "pecial 5i!il Action in the "upreme 5ourt. 5ertiorari.
2acts(
Cirginia 5amacho Iuintia was hired as Fedical $irector of petitioner=s Research and $e!elopment
$epartment.
Her contract pro!ided for a term of 1 year, sub6ect to renewal by mutual consent of the parties at
least ,3 days before its e-piration.
"ubse9uently, after her contract e-pired, she remained in the employ of petitioner where she also
ser!ed as company physician.
%n Guly 13, 1#87, she was replaced after she was dismissed. "he allegedly led the ran and file
employees to demand for a full disclosure of the association=s status.
"he complains of illegal dismissal.
$efense of petitioner( e-piration of contract
0ssue( <%N Iuintia was a regular employee
Held( Ees
Ratio(
necessary and desirable to bi*
no mention in contract that she was hired for 6ust a pro6ect or of any consultancy agreement
fact that she was not re9uired to report at a fi-ed hour does not change her status as a regular
employee
managerial employees not co!ered by the &abor 5ode pro!isions on hours of wor
while loss of confidence is a !alid ground for the dismissal, e!en managerial employees
en6oy security of tenure and can only be dismissed after cause is shown in appropriate
proceeding .<estern "hipping Agency, 0nc !s N&R5/
2 written notices( apprises of particular acts and 2( informs employee of their decision to
dismiss him
c. field personnel
$ercidar 6ishing )orp vs ,R), %&" S)RA 331 (&'(
Nature( "pecial 5i!il Action in the "5. 5ertiorari
2acts(
2ermin Agao, Gr. was employed by petitioner as a bodegero or ship=s 9uartermaster.
He was allowed to go one lea!e without pay for one month from April 28, 1##3 because of
sicness. Howe!er, when he reported bac to wor, he seemed to ha!e been constructi!ely dismissed
when petitioner refused him assignments aboard its boats.
Action for( illegal dismissal, +$ 8;1, and non-payment of ;-days ser!ice incenti!e lea!e. +etitioner
contends that he was a field personnel who has no statutory right to ser!ice incenti!e lea!e.
0ssue( <%N he was a field personnel
Held( No
Ratio(
2ield personnel( non-agricultural employees who regularly perform their duties away from the
principal place of business or branch office of the employer and whose actual hours of wor in the
field cannot be determined with reasonable certainty.
Not field personnel(
during entire course, re9uired to remain on board its !essel
throughout duration of their wor, they were under the effecti!e control and super!ision of
petitioner thru the !essel=s patron or master
d. dependent family members
e. domestic helpers
f. persons in the personal ser!ice of another
g. piece worers
,abor )ongress vs ,R), %&1 S)RA #1& (&'(
Nature( "pecial 5i!il Action in the "5. 5ertiorari
2acts(
## employees of 'mpire 2ood +roducts .repacing snac food/ allegedly abandoned their wor on
Ganuary 21, 1##1. "ecurity 4uard 5airo testified that said worers refused to wor which resulted in the
spoilage of cheese curls.
0ssue( <%N they were regular employees
Held( E'", piece-rate worers considered as regular employees
5iece*rate7 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
Ratio(
their 6ob was necessary and desirable to bi* .manufacture and selling of food products/
employment was not dependent on a specific pro6ect or season
length of time they ha!e been woring for respondents
they are entitled to(
holiday pay ."ection 8.b/, Rule :, Doo ,/
1,
th
month pay .no 2 of 1,
th
month pay law/
o!ertime pay
2>7. 4o!ernment employees
The terms and conditions of employment of all go!ernment employees, including employees of
4%55, shall be go!erned by the 5i!il "er!ice &aw, rules and regulations.
Their salaries shall be standardi*ed by the National Assembly as pro!ided for in the New
5onstitution. Howe!er, there shall be no reduction of e-isting wages, benefits and other terms and
conditions of employment being en6oyed by them at the time of the adoption of the 5ode.
Doo ,
Rule 1. Hours of <or
"ection 1. 4eneral "tatement on 5o!erage
-shall apply to all employees in all establishments and undertaings, whether operated for profit
or not, e-cept to those specifically e-empted under "ection 2 hereof.
"ection 2. '-emption- The pro!ision of this Title shall not apply to the ff persons if they 9ualify for
e-emption under the conditions set forth herein(
a. go!ernment employees whether employed by the National 4o!ernment or any of its political
subdi!isions, including those employed in 4%55s
b. managerial employees, if they meet all of the following conditions, namely(
1. their primary duty consists of the management of the establishment in which they are employed or
a department or subdi!ision thereof
2. they customarily and regularly direct the wor of 2 or more employees therein
,. they ha!e the authority to hire or fire other employees of lower ran1 or their suggestions and
recommendations as to the hiring and firing and as to the promotion or any other change of status of
other employees are gi!en particular weight.
c. officers and members of a managerial staff if they perform the ff. duties and responsibilities(
1. primary duty consists of the performance of wor directly related to management policies of their
employer
2. customarily and regularly e-ercise discretion and independent 6udgment
,.
i. regularly and directly assist a proprietor of a managerial employee whose primary duty consists of
the management of the establishment or its subdi!ision
ii. e-ecute under general super!ision wo along speciali*ed or technical lines re9uiring special
training, e-perience, or nowledge
iii. e-ecute under general super!ision special assignments and tass and
:. who do note de!ote more than 23 percent of their hours wored in a wor-wee to acti!ities which
are not directly and closely related to the performance of the wor abo!e described.
d. domestic ser!ants and persons in the personal ser!ice of another if they perform such ser!ices in
the employer=s home which are usually necessary or desirable for the maintenance and en6oyment
thereof, or minister to the personal comfort, con!enience, or safety of the employer as well as the
members of his employer=s household.
e. worers who are paid by results, including those who are paid on piecewor, taay, paiao, or tas
basis, if their output rates are in accordance with the standards prescribed under "ection 8, Rule >,
Doo ,, of these regulations, or where such rates ha!e been fi-ed by the "ecretary of &abor in
accordance with the aforesaid "ection.
f. non-agricultural field personnel if they regularly perform their duties away from the principal or
branch office or place of business of the employer and whose actual hours of wor in the field cannot
be determined with reasonable certainty.
,. Normal Hours of <or
8,. The normal hours of any employee shall not e-ceed 8 hours a day.
Health personnel in cities and municipalities with a population of at least 1F or in hospitals and
clinics with a bed capacity of at least 133
shall hold regular office hours for 8 hours a day
for ; days a wee
e-clusi!e of time for meals
e-cept where the e-igencies of the ser!ice re9uire that such personnel wor for 7 days or
:8 hours
* in which case they shall be entitled to an additional compensation of at least ,3K
of their regular wage for wor on the 7
th
day.
2or purposes of this article, health personnel shall include(
resident physicians
nurses
nutritionists
dietitians
pharmacists
social worers
lab technicians
paramedical technicians
psychologists
midwi!es
attendants
and all other hospital or clinic personnel
:. 5ompensable Hours of <or- 0n 4eneral
a. %n duty
8:. Hours wored- shall include(
a. all time during which an employee is re9uired to be on duty or to be at a prescribed worplace
Doo ,, Rule 1, "ec ,-
a. all time during which an employee is re9uired to be on duty or to be at a prescribed worplace
"ec :. +rinciples in $etermining Hours <ored
The following general principles shall go!ern in determining whether the time spent by an
employee is considered hours wored for purposes of this Rule(
a. All hours are hours wored which the employee is re9uired to gi!e to his employer, regardless of
whether or not such hours are spent in producti!e labor or in!ol!e physical of mental e-ertion.
b. At wor
8:. b. all time during which an employee is suffered or permitted to wor
Doo ,, Rule 1, "ection , .b/
* all time during which an employee is suffered of permitted to wor
;. "pecific Rules
a. Rest +eriod
i. "hort duration
8:. Hours wored-
Rest period of short duration during woring hours shall be counted as hours wored.
Doo ,, Rule 1, "ec >, 2
nd
par.
Rest periods or coffee breas running from ; to 23 minutes shall be considered as 5ompensable
woring time.
ii. Fore than 23 min.
Doo ,, Rule 1, "ec :.b/
An employee need not lea!e the premises of the worplace in order that his rest period shall not
be counted, it being enough that he stops woring, ay rest completely and may lea!e his worplace, to go
elsewhere, whether within or outside the premises of his worplace.
b. meal period
i. %ne Hour-
8;. Feal periods
"ub6ect to such regulations as the "ec of &abor may prescribe, it shall be the duty of e!ery
employer to gi!e his employees not less than 73 minutes time-off for their regular meals.
Doo ,, Rule 1, "ec >, 1
st
par.
'!ery employer shall gi!e his employees, regardless of se-, not less than 1 hour time-off for
regular meals, e-cept in the following cases when a meal period of not less than 23 minutes may be gi!en
by the employer pro!ided that such shorter meal period is credited as compensable hours wored of the
employee(
a. where the wor is non-manual wor in nature or does not in!ol!e strenuous physical e-ertion
b. when the establishment regularly operates not less than 17 hours a day
c. in cases of actual or impending emergencies or there is urgent wor to be performed on
machineries, e9uipment or installations to a!oid serious loss which the employer would otherwise
suffer and
d. where the wor is necessary to pre!ent serious loss of perishable goods.
5hilippine Airlines vs ,R), 01% S)RA #'% (&&(
Nature( "pecial 5i!il Action in the "5. certiorari
2acts(
$r. Herminio 2abros ser!ed as flight surgeon of +al Fedical 5linic at Nichols and was on duty from
: pm to 12 midnight.
2ebruary 1>, 1##: at around > pm( he left post and went home to ha!e dinner. +A& cargo "er!ices
employee, Acosta suffered a heart attac so nurse 'usebio called 2abros about emergency. <hen 2abros
arri!ed at clinic at around >(;1, 'usebio had already left with patient. +atient died the ne-t day.
2abros was suspended for , months.
0ssue( <%N lea!ing company premises for meal constituted abandonment of wor
Held( N%
Ratio(
8-hour wor period does not include meal breas
law does not re9uire that employees must tae their meals within company premises
8,( normal hours of wor( e-clusi!e of time for meals
8;( meal periods( at least 73 minutes off for their regular meals
no damages( no bad faith on part of +A&
ii. &ess than 1 hour but not less than 23 minutes
Doo ,, Rule 1, "ec >, 1
st
par.
'!ery employer shall gi!e his employees, regardless of se-, not less than 1 hour time-off for
regular meals, e-cept in the following cases when a meal period of not less than 23 minutes may be gi!en
by the employer pro!ided that such shorter meal period is credited as compensable hours wored of the
employee(
a. where the wor is non-manual wor in nature or does not in!ol!e strenuous physical e-ertion
b. when the establishment regularly operates not less than 17 hours a day
c. in cases of actual or impending emergencies or there is urgent wor to be performed on
machineries, e9uipment or installations to a!oid serious loss which the employer would otherwise
suffer and
d. where the wor is necessary to pre!ent serious loss of perishable goods.
c. waiting time
Doo ,, Rule 1, "ec ; .a/
<aiting time spent by an employee shall be considered as woring time if waiting is an integral
part of his wor or the employee is re9uired or engaged by the employer to wait.
Arica vs ,R), 1"1 S)RA ""! ('&(
Nature( +etition for certiorari to re!iew the decision of the N&R5
2acts(
<orers of "tandard +hil 2ruits 5orporation ."TAN20&5%/ wanted court to declare that the
preliminary acti!ities done in the assembly area before Rofficial= wor tie starts should be considered as
waiting time and thus compensable.
Acti!ities included(
1. roll call and getting indi!idual wor assignments
accomplish &aborer=s $aily Accomplishment Report
get woring materials from stocroom
tra!el to field with materials
0ssue( <%N prelim acti!ities constitute compensable waiting time
Held( N% .based on Associated &abor )nion !s "TAN20&5%/
Ratio(
cannot be considred waiting time within pur!iew of section ;, rule 1, boo , of RR0 &5
long practiced and institutionali*ed by mutual consent
does not depri!e them time to attend to other personal pursuits
not sub6ect to the absolute control of the company during such period
"armiento dissents( mas agree ao sa anya
d. %n call, "ection ; .b/
An employee who is re9uired to remain on call in the employer=s premises or so close thereto that
he cannot use the time effecti!ely and gainfully for his own purpose shall be considered as woring while
on call. An employee who is not re9uired to lea!e word at his home or with company officials where he
may be reached is not woring while on call.
e. 0nacti!e due to wor interruptions
"ection : .d/
The time during which an employee is inacti!e by reason of interruptions in his wor beyond his
control shall be considered time either if the imminence of the resumption of wor re9uired the
employee=s presence at the place of wor of if the inter!al is too brief to be utili*ed effecti!ely and
gainfully in the employee=s own interest.
f. <or after normal hours
"ection : U
0f the wor performed was necessary of it benefited the employer, or the employee could not
abandon his wor at then end of his normal woring hours because he had no replacement, all time spent
for such wor shall be considered as hours wored, if the wor was with the nowledge of his employer of
immediate super!isor.
g. &ectures, meetings, trainings
"ection 7- shall not be counted as woring time if all the ff conditions are met(
a. attendance is outside of the employer=s regular woring hours
b. attendance is in fact !oluntary
c. the employee does not perform any producti!e wor during such attendance.
h. tra!el time
Rada vs ,R), %1# S)RA !& (&%(
Nature( "pecial 5i!il Action for certiorari to re!iew the decision of the N&R5
2acts(
+etitioner was hired by +hilnor 5onsultants and +lanners, 0nc as dri!er for the construction
super!ision phase of the Fanila North '-pressway '-tension, 2
nd
"tage . from Guly 1, 1#>> to $ecember
,1, 1#8;/.
0llegally dismissed and that he was not paid o!ertime pay although he was made to render ,
hours o!ertime wor for a period of , years(
V time used to and from his residence to the pro6ect site from ;(,3-> and from :-7 pm( to pic up
employees and dri!e them to site.
0ssue( <%N such , hours may be considered compensable o!ertime wor
Held( E'"
Ratio(
pic-up 6ob not merely incidental to petitioner=s 6ob as dri!er
used to the benefit of company( to pre!ent pro6ect delays and inefficiencies resulting from
tardiness
in fact, when he was not a!ailable, another dri!er had to be assigned to do the 6ob
7. %!ertime worApay
8>. %!ertime wor
<or may be performed beyond 8 hours a day pro!ided that the employee is paid for the
o!ertime wor, an additional compensation e9ui!alent to his regular wage plus at least 2;K thereof. <or
performed beyond eight hours on a holiday or rest day shall be paid an additional compensation
e9ui!alent to the rate of the first 8 hours on a holiday or rest day plus at least ,3K thereof.
8#. 'mergency o!ertime wor
Any employee may be re9uired by the employer to perform o!ertime wor in any of the following
cases(
a. when the country is at war or when any other national or local emergency has been declared by the )ongress of the )hief -+ecutive
b. when it is necessary to pre!ent loss of life or property or in case of imminent danger to public safety
due to an actual or impending emergency in the locality caused by serious accidents, fire, flood, typhoon,
earth9uae, epidemic, or other disaster or calamity.
c. when there is urgent wor to be performed on machines, installations, or e9uipment, in order to a!oid
serious loss or damage to the employer or some other cause of similar nature.
d. when the wor is necessary to pre!ent loss or damage to perishable goods, and
e. when the completion or continuation or the wor started before the eighth hour is necessary to pre!ent
serious obstruction or pre6udice to the business or operations of the employer.
Any employee re9uired to render o!ertime wor under this article shall be paid the additional
compensation in this 5hapter.
#3. 5omputation of additional compensation
2or purposes of computing o!ertime and other additional remuneration as re9uired by this
5hapter the regular wage of an employee shall include the cash wag only, without deduction on account
of facilities pro!ided by the employer.
"ection 8. %!ertime +ay
Any employee co!ered by this rule who is permitted or re9uired to wor beyond 8 hours on
ordinary woring aWdays shall be paid an additional compensation for the o!ertime wor in an amount
e9ui!alent to his regular wage plus at least 2;K thereof.
"ection #. +remium and o!ertime pay for holiday and rest day wor
a. e-cept employees referred to under section 2, an employee who is permitted or suffered to wor on
special holidays or on his designated rest days not falling on regular holidays,
shall be paid with an additional compensation as premium pay of not less than ,3K of his regular
wage
2or wor performed in e-cess of 8 hours on special holidays and rest days not falling on regular
holidays
additional compensation e9ui!alent to his rate for the 1
st
8 hours on a special holiday or
rest day plus at least ,3K thereof
b. 'mployees of public utility enterprise as well as those employed in non-profit institutions and
organi*ation shall be entitled to(
the premium and o!ertime pay pro!ided herein
unless they are specifically e-cluded from the co!erage of this Rule as pro!ided in "ection 2
hereof
c. The payment of additional compensation for wor performed on regular holidays shall be go!erned by
Rule :, Doo ,, of these Rules.
"ection 13. 5ompulsory o!ertime wor
a. warAlocal or national emergency
b. necessary to pre!ent loss of life or property or in case of imminent danger to public safety
c. there is urgent wor to be performed on machinesX
d. necessary to pre!ent loss or damage of perishable goods
e. when the completion of continuation of wor started before the 8
th
hour is necessary to pre!ent
serious obstruction r pre6udice to the business or operations of the employer
f. when the o!ertime wor is necessary to a!ail of fa!orable weather or en!ironmental conditions
where performance or 9uality of wor is dependent thereon
0n cases not falling within any of these enumerated in this section, no employee may be made to wor
beyond 8 hours a day against his will.
"ection 11. 5omputation of additional compensation
Regular wage shall include(
cash wage only
without deduction on account of facilities pro!ided by the employer
-ngineering -8uipment 4nc vs $inister of ,abor, 10' S)RA !1!
ature7 5etition to review the resolution of the $inister of ,abor
2acts(
Figuel Aspera wored as mechanical engineer in "audi Arabia. <ored 13 hours a day and
wanted o!ertime pay( Y1.2172 per hour.
0ssue( <%N he was entitled to o!ertime pay
Held( N%
Ratio(
he himself admitted that he was a managerial employee( not entitled to o!ertime pay under
section 82
e-ercised super!ision and control o!er ran and file employees
power to recommend disciplinary action or their dismissal
contract had built-in o!ertime pay with free board and lodging
petitioner acted in good faith in enforcing contract
complainant appro!ed contract himself
>. Night wor
87. Night shift differential.
'!ery employee shall be paid a night shift differential of not less than 13K of his regular wage for
each hour of wor performed between 13 o=cloc in the e!ening and si- o=cloc in the morning.
Doo ,, Rule 2(
"ection 1. 5o!erage.
This Rule shall apply to all employees e-cept(
a. those of the go!ernment and any of its subdi!isions, including 4%55s
b. those of retail and ser!ice establishments regularly employing not more than ; worers
c. domestic helpers and persons in the personal ser!ice of another
d. managerial employees as defined in boo , of this code
e. field personnel and other employees whose time and performance is unsuper!ised by the
employer, including those who are engaged on tas or contract basis, purely commission basis, or
those who are paid a fi-ed amount for performing wor irrespecti!e of the time consumed in the
performance thereof.
"ection 2. Night shift differential
An employee shall be paid night shift differential of no less than 13K of his regular wage for each
hour of wor performed between 13 pm-7 am.
"ection ,. Additional compensation
<here an employee is re9uired or suffered to wor on the period co!ered after his wor schedule,
he shall be entitled to his regular wage plus at least 2;K and an additional amount of no less than 13K of
such o!ertime rate for each hour of wor performed between 13 pm-7 am.
"ection :. Additional compensation on scheduled rest dayAspecial holiday
An employee who is re9uired or permitted to wor on the period co!ered during rest days andAor
special holidays not falling on regular holidays, shall be paid a compensation e9ui!alent to his regular
wage plus at least ,3K and an additional amount of not less than 13K of such premium pay rate for each
hour of wor performed.
"ection ;. Additional compensation on regular holidays
2or wor on the period co!ered during regular holidays, an employee shall be entitled to his
regular wage during these days plus an additional compensation of no less than 13K of such premium
rate for each hour of wor performed.
"ection 7. Relation to agreements
Nothing in this rule shall 6ustify an employer in withdrawing or reducing any benefits, supplements
or payments as pro!ided in e-isting indi!idual or collecti!e agreements or employer practice or policy.
Shell 9il )o of the 5hil vs ational ,abor :nion, '1 5hil 01# (3( note7 pp 0%"*001 only
Ahmm..Spanish case;;;;
*for notes on case, refer to my brain. <istorical ek*ek about night work* stuff about shifts, continuous, discontinuous work
0C. Termination of 'mployment
References(
Article 1,, "ection ,
ART. 282. ;er2ination $- e2plo-er. - An employer may terminate an employment for any of the following
causes(
.a/ "erious misconduct or willful disobedience by the employee of the lawful orders of his employer or
representati!e in connection with his wor1
.b/ 4ross and habitual neglect by the employee of his duties1
.c/ 2raud or willful breach by the employee of the trust reposed in him by his employer or duly authori*ed
representati!e1
.d/ 5ommission of a crime or offense by the employee against the person of his employer or any
immediate member of his family or his duly authori*ed representati!es1 and
.e/ %ther causes analogous to the foregoing.
ART. 28,. Closure of esta$lis'2ent and reduction of personnel. - The employer may also terminate the
employment of any employee due to the installation of labor-sa!ing de!ices, redundancy, retrenchment to
pre!ent losses or the closing or cessation of operation of the establishment or undertaing unless the
closing is for the purpose of circum!enting the pro!isions of this Title, by ser!ing a written notice on the
worers and the Finistry of &abor and 'mployment at least one .1/ month before the intended date
thereof. 0n case of termination due to the installation of labor-sa!ing de!ices or redundancy, the worer
affected thereby shall be entitled to a separation pay e9ui!alent to at least his one .1/ month pay or to at
least one .1/ month pay for e!ery year of ser!ice, whiche!er is higher. 0n case of retrenchment to pre!ent
losses and in cases of closures or cessation of operations of establishment or undertaing not due to
serious business losses or financial re!erses, the separation pay shall be e9ui!alent to one .1/ month pay
or at least one-half .1A2/ month pay for e!ery year of ser!ice, whiche!er is higher. A fraction of at least si-
.7/ months shall be considered one .1/ whole year.
ART. 28:. :isease as ground for ter2ination. - An employer may terminate the ser!ices of an employee
who has been found to be suffering from any disease and whose continued employment is prohibited by
law or is pre6udicial to his health as well as to the health of his co-employees( +ro!ided, That he is paid
separation pay e9ui!alent to at least one .1/ month salary or to one-half .1A2/ month salary for e!ery year
of ser!ice, whiche!er is greater, a fraction of at least si- .7/ months being considered as one .1/ whole
year.
ART. 28;. ;er2ination $- e2plo-ee. - .a/ An employee may terminate without 6ust cause the employee-
employer relationship by ser!ing a written notice on the employer at least one .1/ month in ad!ance. The
employer upon whom no such notice was ser!ed may hold the employee liable for damages.
.b/ An employee may put an end to the relationship without ser!ing any notice on the employer for any of
the following 6ust causes(
1. "erious insult by the employer or his representati!e on the honor and person of the employee1
2. 0nhuman and unbearable treatment accorded the employee by the employer or his representati!e1
,. 5ommission of a crime or offense by the employer or his representati!e against the person of the
employee or any of the immediate members of his family1 and
:. %ther causes analogous to any of the foregoing.
ART. 287. W'en e2plo-2ent not dee2ed ter2inated. - The $ona-fide suspension of the operation of a
business or undertaing for a period not e-ceeding si- .7/ months, or the fulfillment by the employee of a
military or ci!ic duty shall not terminate employment. 0n all such cases, the employer shall reinstate the
employee to his former position without loss of seniority rights if he indicates his desire to resume his
wor not later than one .1/ month from the resumption of operations of his employer or from his relief
from the military or ci!ic duty.
.b/ "ub6ect to the constitutional right of worers to security of tenure and their right to be
protected against dismissal e-cept for a 6ust and authori*ed cause and without pre6udice to the
re9uirement of notice under Article 28, of this 5ode, the employer shall furnish the worer whose
employment is sought to be terminated a written notice containing a statement of the causes for
termination and shall afford the latter ample opportunity to be heard and to defend himself with
the assistance of his representati!e if he so desires in accordance with company rules and
regulations promulgated pursuant to guidelines set by the $epartment of &abor and 'mployment.
Any decision taen by the employer shall be without pre6udice to the right of the worer to contest
the !alidity or legality of his dismissal by filing a complaint with the regional branch of the
National &abor Relations 5ommission. The burden of pro!ing that the termination was for a !alid
or authori*ed cause shall rest on the employer. The "ecretary of the $epartment of &abor and
'mployment may suspend the effects of the termination pending resolution of the dispute in the
e!ent of a pri2a facie finding by the appropriate official of the $epartment of &abor and
'mployment before whom such dispute is pending that the termination may cause a serious labor
dispute or is in implementation of a mass lay-off. .As amended by "ection ,,, Republic Act No.
7>1;, Farch 21, 1#8#/.
Doo 7, Rule 1
"'5T0%N >. Termination of employment by employer. ? The 6ust causes for terminating the ser!ices of an
employee shall be those pro!ided in Article 28, of the 5ode. The separation from wor of an employee for
a 6ust cause does not entitle him to the termination pay pro!ided in the 5ode, without pre6udice, howe!er,
to whate!er rights, benefits, and pri!ileges he may ha!e under the applicable indi!idual or collecti!e
agreement with the employer or !oluntary employer policy or practice.
"'5T0%N 8. $isease as a ground for dismissal. ? <here the employee suffers from a disease and his
continued employment is prohibited by law or pre6udicial to his health or to the health of his co-
employees, the employer shall not terminate his employment unless there is a certification by competent
public health authority that the disease is of such nature of at such a stage that it cannot be cured within
a period of si- .7/ months e!en with proper medical treatment. 0f the disease or ailment can be cured
within the period, the employee shall not terminate the employee but shall as the employee to tae a
lea!e of absence. The employer shall reinstate such employee to his former position immediately upon
the restoration of his normal health.
"'5T0%N #. Termination pay. ? .a/ An employee shall be entitled to termination pay e9ui!alent to at least
one month@s salary for e!ery year of ser!ice a fraction of at least si- .7/ months being considered as one
whole year, in case of termination of his employment due to the installation of labor-sa!ing de!ices or
redundancy.
.b/ <here the termination of employment is due to retrenchment to pre!ent losses and in case of closure
or cessation of operations of establishment or undertaing not due to serious business losses or financial
re!erses, or where the employment is prohibited by law or is pre6udicial to his health or to the health of
his co-employees, the employee shall be entitled to termination pay e9ui!alent to at least one-half
month@s pay for e!ery year of ser!ice, a fraction of at least si- months being considered as one whole
year.
.c/ The termination pay pro!ided in the "ection shall in no case be less than the employee@s one month
pay.
"'5T0%N 13. Dasis of termination pay. ? The computation of the termination pay of an employee as
pro!ided herein shall be based on his latest salary rate, unless the same was reduced by the employer to
defeat the intention of the 5ode, in which case the basis of computation shall be the rate before its
deduction.
"'5T0%N 11. Termination of employment by employee. ? The 6ust causes for putting an end to the
employer-employee relationship by the employee shall be those pro!ided in Article 287 of the &abor 5ode.
"'5T0%N 12. "uspension of relationship. ? The employer-employee relationship shall be deemed
suspended in case of suspension of operation of the business or undertaing of the employer for a period
not e-ceeding si- .7/ months, unless the suspension is for the purpose of defeating the rights of the
employees under the 5ode, and in case of mandatory fulfillment by the employee of a military or ci!ic
duty. The payment of wages of the employee as well as the grant of other benefits and pri!ileges while he
is on a military or ci!ic duty shall be sub6ect to special laws and decrees and to the applicable indi!idual
or collecti!e bargaining agreement and !oluntary employer practice or policy.
"'5T0%N 1,. Retirement. ? 0n the absence of any collecti!e bargaining agreement or other applicable
agreement concerning terms and conditions of employment which pro!ides for retirement at an older age,
an employee may be retired upon reaching the age of si-ty .73/ years.
"'5T0%N 1:. Retirement benefits. ? .a/ An employee who is retired pursuant to a bona-fide retirement
plan or in accordance with the applicable indi!idual or collecti!e agreement or established employer
policy shall be entitled to all the retirement benefits pro!ided therein or to termination pay e9ui!alent to
at least one-half month salary for e!ery year of ser!ice, whiche!er is higher, a fraction of at least si- .7/
months being considered as one whole year.
.b/ <here both the employer and the employee contribute to the retirement plan, agreement or policy,
the employer@s total contribution thereto shall not be less than the total termination pay to which the
employee would ha!e been entitled had there been no such retirement fund. 0n case the employer@s
contribution is less than the termination pay the employee is entitled to recei!e, the employer shall pay
the deficiency upon the retirement of the employee.
.c/ This "ection shall apply where the employee retires at the age of si-ty .73/ years or older.
R/L) :(,
Termination of 'mployment
"'5T0%N 1. "ecurity of tenure and due process. ? No worers shall be dismissed e-cept for a 6ust or
authori*ed cause pro!ided by law and after due process.
"'5T0%N 2. Notice of dismissal. ? Any employer who sees to dismiss a worer shall furnish him a written
notice stating the particular acts or omission constituting the grounds for his dismissal. 0n cases of
abandonment of wor, the notice shall be ser!ed at the worer@s last nown address.
"'5T0%N ,. +re!enti!e suspension. ? The employer may place the worer concerned under pre!enti!e
suspension if his continued employment poses a serious and imminent threat to the life or property of the
employer or of his co-worers.
"'5T0%N :. +eriod of suspension. ? No pre!enti!e suspension shall last longer than ,3 days. The
employer shall thereafter reinstate the worer in his former or in a substantially e9ui!alent position or the
employer may e-tend the period of suspension pro!ided that during the period of e-tension, he pays the
wages and other benefits due to the worer. 0n such case, the worer shall not be bound to reimburse the
amount paid to him during the e-tension if the employer decides, after completion of the hearing, to
dismiss the worer.
"'5T0%N ;. Answer and hearing. ? The worer may answer the allegations stated against him in the
notice of dismissal within a reasonable period from receipt of such notice. The employer shall afford the
worer ample opportunity to be heard and to defend himself with the assistance of his representati!e, if
he so desires.
"'5T0%N 7. $ecision to dismiss. ? The employer shall immediately notify a worer in writing of a decision
to dismiss him stating clearly the reasons therefor.
"'5T0%N >. Right to contest dismissal. ? Any decision taen by the employer shall be without pre6udice to
the right of the worer to contest the !alidity or legality of his dismissal by filing a complaint with the
Regional Dranch of the 5ommission.
"'5T0%N 8. +eriod to decide. ? 5ases in!ol!ing the dismissal of a worer shall be decided by the &abor
Arbiter within 23 woring days from the date of submission of such cases for decision.
"'5T0%N #. Reinstatement pending hearing. ? The "ecretary may suspend the effects of the termination
pending resolution of the case in the e!ent of a prima facie finding that the termination may cause a
serious labor dispute or is in implementation of a mass lay-off.
"'5T0%N 13. 5ertification of employment. ? A dismissed worer shall be entitled to recei!e, on re9uest, a
certificate from the employer specifying the dates of his engagement and termination of his employment
and the type or types of wor on which he is employed.
"'5T0%N 11. Report of dismissal. ? The employer shall submit a monthly report to the Regional %ffice
ha!ing 6urisdiction o!er the place of wor all dismissals effected by him during the month, specifying
therein the names of the dismissed worers, the reasons for their dismissal, the date of commencement
and termination of employment, the positions last held by them and such other information as may be
re9uired by the $epartment for policy guidance and statistical purposes
A. 4eneral 5oncepts
1. 5o!erage
ART. 2>8. Coverage. - The pro!isions of this Title shall apply to all establishments or undertaings,
whether for profit or not.
2. "ecurity of tenure
ART. 2>#. Securit- of tenure. - 0n cases of regular employment, the employer shall not terminate the
ser!ices of an employee e-cept for a 6ust cause or when authori*ed by this Title. An employee who is
un6ustly dismissed from wor shall be entitled to reinstatement without loss of seniority rights and other
pri!ileges and to his full bacwages, inclusi!e of allowances, and to his other benefits or their monetary
e9ui!alent computed from the time his compensation was withheld from him up to the time of his actual
reinstatement. .As amended by "ection ,:, Republic Act No. 7>1;, Farch 21, 1#8#/.
5ondo "uite 5lub Tra!el 0nc !s N&R5, Gan 28, 2333
2acts(
+ri!ate respondent was first employed as houseeeper by "unette Realty de!elopment 5orp and
was later employed by 5ondo "uite 5lub Tra!el 0nc, both owned by AR5%N.
+ri!ate respondent also owned a car which he rented out to one &andrigan which the latter
operated as a ta-i.
%n August 1;, 1##:, &adrigan approached the front des cler and a certain 0n H) had owes him
2333 for car ser!ice and for that amount to be included in the guest=s bill. 4uest left hurriedly. Dut in
Borea, disco!ered discrepancy. 5omplained. 17>13---1:>13
"er!ices terminated for loss of confidence in his malicious intent to defraud a guest.
&A( dismissed complaint for diminution of salary and illegal dismissal
&A( affirmed dismissal of complaint for diminution
%rdered reinstatement since incident was &adrigan=s fault
0ssue( <%N he was !alidly terminated
Held( N%
Ratio(
1. The fundamental guarantee of security of tenure dictates that no worer shall be dismissed
e-cept for 6ust and authori*ed cause pro!ided by law and with due process.
a. no 6ust cause
282 c( fraud or willful breach by the employee of the trust reposed in him by his
employer
not pro!en that there was intention to defraud
No proof that +R ordered the front des cler to enter the additional
amount
+R had nothing to do with &adrigan=s demand for payment
b. no notice and hearing
notices which states acts and omissions and 2
nd
notice informing him of decision
to dismiss
incident report of Fr +adua not enough co it did not specifically indicate +R=s
role in incident
5itytrust Daning 5orp !s N&R5, 1##7
2acts(
Anita Rui*( internal auditor of 5itytrust
&ater designated as branch manager of Iuaipo branch but refused position( demotion. "uspended
and after clearance by $%&', she was terminated.
2iled for illegal dismissal. %rdered reinstated as branch manager by N&R5.
Finister of &abor( same decision
%ffice of +resident( reinstated as internal auditor
+etitioner mo!ed for recon( internal auditor abolished .resident inspector was new position in
place/ so %ffice of +resident ordered reinstatement to a substantially e9ui!alent position. 5ompany
reinstated her as manager of auditing $epartment.
&A( not substantially e9ui!alent
N&R5( affirmed
0ssue( <%N the reinstatement to position as manager of auditing department upheld her right to security
of tenure
Held( N%
Ratio(
1. Reinstatement contemplates a restoration to a position from which one has been remo!ed or
separated so that the employee concerned may resume the functions of a position he already
held.
2. An affirmation that those depri!ed of a recogni*ed and protected interest should be made whole
so that the employer will not profit from his misdeeds.
a. Nature of rightArationale
Alhambra 0ndustries 0nc !s N&R5, No!. 18, 1##:
2acts(
$anilo Rupisan was employed by A&HAFDRA.
Decause of a surprise audit of the his records, the company found him guilty of !iolations of
company rules. <as placed under 1-month pre!enti!e suspension which he protested against.
A day before the end of his suspension, he as informed of the termination of his ser!ices effecti!e
2ebruary 8, 1##3.
"uit for illegal dismissal with illegal suspension and unpaid bacwages or commissions.
&A( termination was for 6ust cause but there was !iolation of due process( bacwages and separation pay
in lieu of reinstatement
N&R5( affirmed lac of due process but said that he could ha!e e-plained so they ordered reinstatement
0ssue( <%N he was !alidly dismissed
Held( E'"
Ratio(
1. Nature of right( "ecurity of tenure should be respected beco* termination of employment is not
longer a mere se!erance of contractual relationship but an economic phenomenon affecting
members of the family.
2. He was found guilty of serious misconduct so he cannot demand reinstatement nor separation pay
,. <enphil 5orpo !s N&R5( a 6ustly grounded termination without procedural due process would only
sanction payment of damages
+etition granted, assailed 6udgment set aside.

&losa Tan !s. "ilahas 0nternational, 1##3
2acts(
<as front office cashier of "ilahis 0nternational Hotel since No!ember 2, 1#>7.
"ince 1#>>, 5orporate +olicy No. 31: was issued to minimi*e losses e-perienced by company
because of checs encashed by them which later bounced.
+etitioner allegedly !iolated said policy when she encashed Y1233 chec of Fr. 4ayondato, the
general cashier of +uerto A*ul Deach resort and nephew of 'C+.
"uatengco ordered petitioner to e-plain and also placed her under pre!enti!e suspension.
+etitioner wrote a letter of e-planation but her ser!ices were ne!ertheless terminated on %ctober
,3, 1#82.
&A( illegal dismissal( reinstate
N&R5( set aside decision, dismissed complaint for illegal dismissal for lac of merit
0ssue( <%N petitioner was !alidly dismissed on the ground of gross negligence
Held( N%
Ratio(
1. gross negligence( the want of any right or slight care or the utter disregard of conse9uences not
pro!en
2. encashment !iolated policy but(
a. no bad faith
b. policy not strictly enforced
c. superiors were aware( petitioner told Assistant manager 4rulla who assured her that such
is alright
,. The right of employer to freely select or discharge his employees is regulated by the state
because the preser!ation of the li!es of the citi*ens is a basic duty of the state, more !ital than
the preser!ation of corporate profit.
:. "ecurity of tenure is a right of paramount !alue guaranteed by the consti and should not be
denied on mere speculation.
5ity "er!ices 5orp. <orers !s 5ity "er!ices 5orp, 1#8;
2acts(
Calencia and other petitioners were hired as 6anitors by 5"5 and assigned to the Army and na!y 5lub.
The club reported that petitioners could ha!e been stealing club properties and ased that they be
replaced.
5"5 dismissed petitioners without pre!ious formal in!estigation and pre!ious clearance by sec of
labor as re9uired by the then pre!ailing law.
&A( illegally dismissed( reinstatement and bacwages
N&R5( illegally dismissed but ordered separation pay since reinstatement has become remote and
impossible considering that their dismissal too place si- years ago.
0ssue( <%N N&R5 decision was correct.
Held( No
Ratio(
1. N&R5 simply assumed the remoteness of reinstatement
2. "ecurity of tenure is gi!en specific recog and guarantee by consti.
,. should not be denied on so nebulous a basis as mere speculation
3. 283( un6ust dismissal reinstatement without loss of seniority rights and bacwages from the
time his compensation was withheld up to the time of his reinstatement
b. 5o!erage
0nter%rient Faritime 'nterprises 0nc. !s N&R5, 1##:
2acts(
5aptain Tayog was hired by Trenda <orld "hipping and "ea Horse Hip Fanagement 0nc thru
petitioner as Faster of the FAC %ceanic Findoro.
He was gi!en the instruction to assume the command of the !essel at +ort of Hongong where he
was to replenish buner and diesel fuel and to sail forthwith to Richard Day, "outh Africa in order to load
123,333 metric tons of coal.
)pon hearing that storm 4ordon was to hit Hongong, Tayog followed up the re9uest for o-ygen
and acetylene which were necessary for the repaid of the turbo-charger and the economi*er.
The ship=s agent howe!er informed them that the supplies could be deli!ered only at 3833 hours,
> hours after the 'T$ from the port to Africa.
Tayog waited for the supplies and !oyage was delayed. )pon arri!ing at Richard bay, he was
instructed to turn-o!er his post to a new captain and thereafter was repatriated to the +hilippines. He was
not informed of charges.
+%'A( !alidly dismissed
N&R5( illegal( no opportunity to be heard, no e!idence to pro!e loss of trust or confidence
0ssue( <%N he was !alidly dismissed
Held( N%
Ratio(
1. 5onfidential employees cannot be arbitrarily dismissed at any time, and without cause as
reasonably established in an in!estigation.
ne!er informed of charges
not accorded opportunity to hear
he had !alid and 6ustifiable reasons for causing the delay
2. 5aptains are confidential employees who perform both management and fiduciary functions
a. general agent of shipowner
b. commander and technical director of the !essel
c. representati!e of the country under whose flag he na!igates
&ope* !s N&R5, 1##7
2acts(
+etitioner was appointed 4eneral Fanager on probationary status by th D%$ of &a )nion Transport
"er!ices 5ooperati!e .&)TRA"5%/.
Darely four months after his appointment, he was terminated on the ground of loss of trust and
confidence and unsatisfactory performance.
1. 2alsification of a board resolution which pro!ides a free uniform for all the members of the
Doard of $irectors by altering the wordings of the said resolution and made it to appear that the staff
and himself are beneficiaries thereof, without the consent and authority of the board1
2. Neglect of his duty as 4eneral Fanager to chec up regularly the in!entory of the $iesel
pump1
,. Abandonment of wor1 Falingering1
:. )nreasonable refusal to recei!e partial payment from members of their account, thereby
denying the cooperati!e legitimate re!enuesAincome1
;. Negligence in sending notices to members of good standing of the general assembly meeting,
resulting to embarrassment of some members1
7. Responsible in introducing partisan politics in the cooperati!e by deliberately ignoring the
ad!ice of the 5hairman to post the names of the candidates in only one board and allowed a group of
candidates to create their own ticets with his full support1
>. $elegating his duty to mae his report to the 4eneral Assembly thru the accountant1
8. <ilful and deliberate refusal to comply with terms of his promissory note for the deduction of
a certain amount during pay days in fa!or of the cooperati!e1
#. )nauthori*ed cash ad!ances from the sale of diesel.
&A( illegal, reinstate
N&R5( illegal dismissal but reinstatement would not be conduci!e to industrial harmony since he is a
managerial employee
Dacwages( bacwages up to , months since he was still probationary employee
%"4( from the time an employee is illegally dismissed to the time he is restored to his position of up to
the finality of 6udgment
0ssue( <%N he was !alidly dismissed
Held( N% but no reinstatement since it would not be conduci!e to industrial harmony
Ratio(
1. charges were baseless
2. amount of bacwages
N&R5 connection between bacwages and employee as probationary is incorrect
No distinction( refers to all employees regardless of status
+etitioner wrong that he was entitled to , years worth of bacwages( no wor,
no pay
2rom April #, 1##3 to finality of 6udgment
c. Re9uisites for lawful dismissal and measure of penalty
2arrol !s. 5A, 2eb. 13, 2333
D. +ro6ect 'mployees
No date supplied
+%&05E 0N"TR)5T0%N" N%. 23->7
"TAD0&0L0N4 'F+&%E'R-'F+&%E'' R'&AT0%N" 0N TH' 5%N"TR)5T0%N 0N$)"TRE
0n the interest of stabili*ing employer-employee relations in the construction industry and taing into
consideration its uni9ue characteristics, the following policy instructions are hereby issued for the
guidance of all concerned. cd
4enerally, there are two types of employees in the construction industry, namely( 1/ +ro6ect employees
and 2/ Non-+ro6ect employees.
+ro6ect employees are those employed in connection with a particular construction pro6ect. Non-pro6ect
employees are those employed by a construction company without reference to any particular pro6ect.
+ro6ect employees are not entitled to termination pay if they are terminated as a result of the completion
of the pro6ect or any phase thereof in which they are employed, regardless of the number o pro6ects in
which they ha!e been employed by a particular construction company. Foreo!er, the company is not
re9uired to obtain a clearance from the "ecretary of &abor in connection with such termination. <hat is
re9uired of the company is a report to the nearest +ublic 'mployment %ffice for statistical purposes.
0f a construction pro6ect or any phase thereof has a duration of more than one year and a +ro6ect
employee is allowed to be employed therein for at least one year, such employee may not be terminated
until the completion of the pro6ect or of any phase thereof in which he is employed without a pre!ious
written clearance from the "ecretary of &abor. 0f such an employee is terminated without a clearance from
the "ecretary of &abor, he shall be entitled to reinstatement with bacwages.
The employees of a particular pro6ect are not terminated at the same time. "ome phases of the pro6ect
are completed ahead of others. 2or this reason, the completion of a phase of the +ro6ect is the completion
of the pro6ect for an employee employed in such phase. 0n other words, employees terminated upon the
completion of their phase of the pro6ect are not entitled to separation pay and e-empt from the clearance
re9uirement.
%n the other hand, those employed in a particular phase of a construction pro6ect are also not terminated
at the same time. Normally, less and less employees are re9uired as the phase draws closer to
completion. +ro6ect employees terminated because their ser!ices are no longer needed in their particular
phase of the pro6ect are not entitled to separation pay and are e-empt from the clearance re9uirement,
pro!ided they are not replaced. 0f they are replaced, they shall be entitled to reinstatement with
bacwages.
Fembers of a wor pool from which a construction company draws its pro6ect employees, if considered
employees of the construction company while in the wor pool, are non-pro6ect employees or employees
for an indefinite period. 0f they are employed in the particular pro6ect, the completion of the pro6ect or of
any phase thereof will not mean se!erance of employer-employee relationship.
Howe!er, if the worers in the wor pool are free to lea!e anytime and offer their ser!ices to other
employers then they are pro6ect employees employed by a construction company in a particular pro6ect or
in a phase thereof.
4enerally, there are three .,/ types of non-pro6ect employees( first, probationary employees1 second,
regular employees1 and third, casual employees.
+robationary employees are those who, upon the completion of the probationary period, are entitled to
regulari*ation. Regular employees are those who ha!e completed the probationary period or those
appointed to fill up regular positions !acated as a result of death, retirement, resignation, or termination
of the regular holders thereof. %n the other hand, casual employees are those employed for a short term
duration to perform wor not related to the main line of business of the employer.
The non-pro6ect employees of a construction company shall ha!e the right to self-organi*ation and free
collecti!e bargaining. They may constitute or form part of the appropriate ran and file collecti!e
bargaining unit within the company.
%n the other hand, it is the policy of the $epartment of &abor to promote the unioni*ation of pro6ect
employees by industry, but not by pro6ects. 0n other words, for pro6ect employees the appropriate
collecti!e bargaining unit is the industry, not any particular pro6ect or any phase thereof. Therefore, the
employees of a particular pro6ect cannot constitute an appropriate collecti!e bargaining unit. They may,
howe!er, 6oin the recogni*ed industry union in the construction industry.
+ending the establishment of the recogni*ed industry-wide union in the construction industry, a Tripartite
5onstruction 0ndustry Doard .T50D/ is hereby established composed of representati!es of the employers,
representati!es of the worers and representati!es of the go!ernment for the purpose of establishing fair
wages and other terms and conditions of employment in the industry, short of free collecti!e bargaining.
The Doard shall also ser!e as a forum for consultations on all other matters affecting employer-employee
relations in the industry, including manpower de!elopment and employment. cdsia
.Note( The issuance is undated/
."4$./ D&A" 2. %+&'
"ecretary
April 1, 1##,
$'+ARTF'NT %R$'R N%. 31#-#,
4)0$'&0N'" 4%C'RN0N4 TH' 'F+&%EF'NT %2 <%RB'R" 0N TH' 5%N"TR)5T0%N 0N$)"TRE
0n the interest of stabili*ing and promoting harmonious employer-employee relations in the construction
industry and in order to ensure the protection and welfare of worers employed therein, the following
guidelines are hereby issued for all concerned(
"'5T0%N 1. 5o!erage
This issuance shall apply to all operations and undertaings in the construction industry and its
subdi!isions, namely( general building construction, general engineering construction and special trade
construction, based on the classification code of the +hilippine 5onstruction Accreditation Doard of the
5onstruction 0ndustry Authority of the +hilippines1 to companies and entities in!ol!ed in demolition wors1
and to those falling within the construction industry as determined by the "ecretary of &abor and
'mployment.
"'5T0%N 2. 'mployment "tatus
2.1 5lassification of employees. ? The employees in the construction industry are generally
categori*ed as a/ pro6ect employee and b/ non-pro6ect employees. +ro6ect employees are those employed
in connection with a particular construction pro6ect or phase thereof and whose employment is co-
terminus with each pro6ect or phase of the pro6ect to which they are assigned. prcd
Non-pro6ect employees, on the other hand, are those employed without reference to any particular
construction pro6ect or phase of a pro6ect.
2.2 0ndicators of pro6ect employment. ? 'ither one or more of the following circumstances, among
others, may be considered as indicators that an employee is a pro6ect employee.
.a/ The duration of the specificAidentified undertaing for which the worer is engaged is reasonably
determinable.
.b/ "uch duration, as well as the specific worAser!ice to be performed, is defined in an employment
agreement and is made clear to the employee at the time of hiring.
.c/ The worAser!ice performed by the employee is in connection with the particular
pro6ectAundertaing for which he is engaged.
.d/ The employee, while not employed and awaiting engagement, is free to offer his ser!ices to any
other employer.
.e/ The termination of his employment in the particular pro6ectAundertaing is reported to the
$epartment of &abor and 'mployment .$%&'/ Regional %ffice ha!ing 6urisdiction o!er the worplace
within ,3 days following the date of his separation from wor, using the prescribed form on employees@
terminationsAdismissalsAsuspensions.
.f/ An undertaing in the employment contract by the employer to pay completion bonus to the
pro6ect employee as practiced by most construction companies.
2., +ro6ect completion and rehiring of worers. ?
.a/ The employees of a particular pro6ect are not separated from wor at the same time. "ome
phases of the pro6ect are completed ahead of others. 2or this reason, the completion of a phase of the
pro6ect is considered the completion of the pro6ect for an employee employed in such phase. Feanwhile,
those employed in a particular phase of a construction pro6ect are also not separated at the same time.
Normally, less and less employees are re9uired as the phase draws closer to completion.
.b/ )pon completion of the pro6ect or a phase thereof, the pro6ect employee may be rehired for
another undertaing pro!ided, howe!er, that such rehiring conforms with the pro!isions of law and this
issuance. 0n such case, the last day of ser!ice with the employer in the preceding pro6ect should be
indicated in the employment.
2.: Types of non-pro6ect employees. ? 4enerally there are three .,/ types of non-pro6ect employees(
first, probationary employees1 second, regular employees1 and third, casual employees.
.a/ +robationary employees are those who, upon the completion of the probationary period, are
entitled to regulari*ation. )pon their engagement, probationary employee should be informed of the
reasonable standards under which they will 9ualify as regular employees.
.b/ Regular employees are those appointed as such or those who ha!e completed the probationary
period or those appointed to fill up regular positions !acated as a result of death, retirement, resignation
or termination of employment of the regular holders thereof.
.c/ 5asual employees are those employed to perform wor not related to the main line of business of
the 'mployer. 5asual employees who are employed for at least one year, whether continuous or broen,
shall be considered regular with respect to the acti!ity in which they are employed and their employment
shall continue for as long as such acti!ity e-ists, unless the employment is terminated sooner by the
employer for a 6ust or authori*ed cause, or !oluntarily by the employee. prcd
2.; 5ontracting and subcontracting. ? The practice of contracting out certain phases of a
construction pro6ect is recogni*ed by law, particularly wage legislations and wage orders, and by industry
practices. The &abor 5ode and its 0mplementing Regulations allow the contracting out of 6obs under
certain conditions. <here such 6ob contracting is permissible, the construction worers are generally
considered as employees of the contractor or sub-contractor, as the case may be, sub6ect Art. 13# of the
&abor 5ode, as amended.
"'5T0%N ,. 5onditions of 'mployment
,.1 "ecurity of tenure. +ro6ect employees who ha!e become regular shall en6oy security of tenure in
their employment as pro!ided under Article 283 of the &abor 5ode, as amended. <here their ser!ices are
terminated for a causeAcauses, they are not by law entitled to separation pay. The 6ust causes for
terminating employment are enumerated under Article 282 of the 5ode. <here the ser!ices of regular
employees are terminated for any of the authori*ed causes under Article 28,, as distinguished from 6ust
causes, they are entitled to separation pay.
,.2 +ro6ect employees not entitled to separation pay. ? The pro6ect employees contemplated by
paragraph 2.1 hereof are not by law entitled to separation pay if their ser!ices are terminated as a result
of the completion of the pro6ect or any phase thereof in which they are employed. &iewise, pro6ect
employees whose ser!ices are terminated because they ha!e no more to do or their ser!ices are no
longer needed in the particular phase of the pro6ect are not by law entitled to separation pay.
,., +ro6ect employees entitled to separation pay. ?
a/ +ro6ect employees whose aggregate period of continuous employment in a construction company
is at least one year shall be considered regular employees, in the absence of a Hday certainH agreed upon
by the parties for the termination of their relationship. +ro6ect employees who ha!e become regular shall
be entitled to separation pay.
A HdayH as used herein, is understood to be that which must necessarily come, although it may not be
nown e-actly when. This means that where the final completion of a pro6ect or phase thereof is in fact
determinable and the e-pected completion is made nown to the employee, such pro6ect employee may
not be considered regular, notwithstanding the one-year duration of two or more employments in the
same pro6ect or phase of the pro6ect.
The completion of the pro6ect or any phase thereof is determined on the date originally agreed upon or
the date indicated on the contract or, if the same is e-tended, the date of termination of pro6ect
e-tension.
b/ 0f the pro6ect or the phase of the pro6ect the employee is woring on has not yet been completed
and his ser!ices are terminated without 6ust cause or authori*ed cause and there is no showing that this
ser!ices are unsatisfactory, the pro6ect employee is entitled to reinstatement with bacwages to his
former position or substantially e9ui!alent position. 0f the reinstatement is no longer possible, the
employee is entitled to his salaries for the une-pired portion of the agreement.
,.: 5ompletion of the pro6ect. ? +ro6ect employees who are separated from wor as a result of the
completion of the pro6ect or an phase thereof in which they are employed are entitled to the pro-rata
completion bonus if there is an undertaing for the grant of such bonus. An undertaing by the employer
to pay a completion bonus shall be an indicator that an employee is a pro6ect employee. <here there is
no such undertaing, the employee may be considered a non-pro6ect employee. The pro-rate completion
bonus may be based on the industry practice which is at least the employee@s one-half .1A2/ month salary
for e!er 12 month ser!ice and may be put into effect for any pro6ect bid .in case of bid pro6ects/ tender
submitted .in case of negotiated pro6ects/ thirty .,3/ days from the date of issuance of these 4uidelines.
,.; "tatutory benefits. ? $uring the period of their employment, the construction employees whether
pro6ect or non-pro6ect shall en6oy all the benefits due to them under the law, both monetary and non-
monetary.
,.7 +ayment by results. ? <here the payment for wor or ser!ices rendered is by results, e.g., piece
rate or HpaiaoH, the rate shall be determined on the basis of not less than the minimum wage applicable
in the region where the construction pro6ect is located. The minimum wage rates of worers who are paid
by results may be determined by the appropriate $%&' Regional %ffice on its initiati!e or upon re9uest of
interested parties.
"'5T0%N :. +re!enti!e "uspension
"ub6ect to Article 2>> .b/ of the 5ode, pro6ect and non-pro6ect employees may be pre!enti!ely suspended
if their continued employment poses a serious and imminent threat to the life or property of the employer
or of their co-worers. No pre!enti!e suspension, howe!er, shall last longer than fifteen .1;/ days. The
employer shall thereafter reinstate the worer in his former or in a substantially e9ui!alent position or the
employer may e-tend the period of suspension pro!ided that during the period of e-tension, he pays the
wages and other benefits due to the worer. The employer shall designate a day, time and place within
the period of pre!enti!e suspension, with notice of the employee, to hold a fact-finding in!estigation, to
enable the suspended employee to be heard and be assisted by his counsel or representati!e, if he so
desires, of the charge and against him and thereby e-onerate the employee, or upon the employee@s
failure to !indicate himself, to find the employee guilty and thereby, to terminate his employment. "uch
termination shall not pre6udice the right of the employee to 9uestion the se!erance of the relationship in
the appropriate forum.
"'5T0%N ;. "elf-%rgani*ation and 5ollecti!e Dargaining
0n recognition of the right of employees to self-organi*ation and collecti!e bargaining, this $epartment
hereby encourages the formation of HtradeH unions in the construction industry, pro!ided that the
formation or acti!ities of a recogni*ed trade unions will not pre6udice e-isting bargaining units, sub6ect to
e-isting laws. As used herein, trade unions refer to a combination of worers of the same trade or of
se!eral allied trades, for the purpose of securing by united action the most fa!orable conditions regarding
wages, hours of labor and other terms and conditions of employment for its members.
"'5T0%N 7. &iabilitiesAResponsibilities of the 'mployer and the <orers.
7.1 Re9uirements of labor and social legislations. ?
.a/ The construction company and the general contractor andAor subcontractor referred to in "ec. 2.;
shall be responsible for the worers in its employ on matters of compliance with the re9uirements of
e-isting laws and regulations on hours of wor, wages, wage-related benefits, health, safety and social
welfare benefits, including submission to the $%&'-Regional %ffice of <or AccidentA0llness Report,
Fonthly Report on 'mployees@ TerminationsA$ismissalsA"uspensions and other reports. The primeAgeneral
contractor shall e-ercise sound 6udgment and discretion in contracting out pro6ects to ensure compliance
with labor standards.
.b/ +ro6ect and non-pro6ect employees shall obser!e the re9uirements of labor and social legislations
and reasonable company rules and regulations on matters pertaining to their obligations.
7.2 0mplementation of safety and health standards. ? The $epartment through the Regional %ffices
shall strictly enforce the %ccupational "afety and Health "tandards, as amended, particularly Rule 133;
on $uties of 'mployers, <orers and %ther +ersons and Rule 1:13 on 5onstruction "afety. Through the
Dureau of <oring 5onditions, the $epartment may issue a code of practice on %ccupational "afety and
Health for the construction industry.
7., <age 0ncreases. ? As regards wage increases, whether mandated or agreed upon by the parties,
the prescribed increase in the wage rates of the worers in construction pro6ects shall be borne by the
principals or clients of the construction contractors and the contracts shall be deemed amended
accordingly. The wage rates of pro6ects employees shall depend on the sills or le!el of competence of
such pro6ect employees as determined by NFE5 Trade and "tandards subscribed to by the +hilippine
5onstruction 0ndustry under the 2i!e Eear 5onstruction Fanpower $e!elopment +lan dated No!ember
1##1, pro!ided that the rates established shall not be lower than that prescribed by the appropriate wage
order and regulations. The liability in subse9uent mandated rates of wage increases andAor allowances to
construction worers shall be determined in accordance with the pro!isions of the applicable wage
legislations or orders.
"'5T0%N >. 'ffect on '-isting 0ssuances and Agreements
These issuances shall ser!e as guides for this $epartment and its agencies in the administration and
enforcement of applicable labor and social legislations and their implementing regulations. prcd
Nothing herein shall be construed to authori*e diminution or reduction of benefits being en6oyed by
employees at the time of issuance hereof.
This $epartment %rder supersedes +olicy 0nstructions No. 23 of 1#>> and shall tae effect immediately.
."4$./ FA. N0'C'" R. 5%N2'"%R
"ecretary
5ases(
0mbuido !s. N&R5, 2333
2acts(
+etitioner was employed as data encoder by 0nternational 0nformation "er!ices, company engaged
in the business of data encoding and eypunching.
2rom August 27, 1#88 until %ctober 18, 1##1, 1, employment contracts were entered, each
lasting for a period of , months( specified that they were hired for a specific pro6ectA6ob contract.
<hen petitioners 6oined &ABA" in a petition for a certification election, company terminated them
but said it was due to low !olume of wor.
&abor Arbiter( regular employee
low !olume( not a !alid cause for termination of regular employees
N&R5( regular employer but only within the duration of specific pro6ect
0ssue( <%N they were pro6ect employees
Held( Ees but they were e!entually regulari*ed
Ratio(
As to their being pro6ect employees(
1. passed principal test( <%N they were assigned to carry out a specific pro6ectAundertaing,
duration and scope of which were specified at the time the employee was engaged for that pro6ect
contained designation of the specific 6ob contract and a specified period of employment
Regulari*ed +ro6ect employees pursuant to re9uisites established in Faraguinot !s N&R5(
1. there is a continuous rehiring of pro6ect employee e!er after cessation of pro6ect
2. tass necessary and indispensable
continuosly hired for more than , years
1, successi!e pro6ects
Association of Trade )nions !s 5omm Abella
2acts(
+etitioners were employed in !arious capacities .mechanic, painter, carpenter, etc/, by Algon
'ngineering 5onstruction 5orporation.
0n 2ebruary 1#8#, they 6oined petitioner union which filed a petition for certification election.
5ompany opposed such petition saying that they were pro6ect employees and not 9ualified to form part of
ran and file 5D).
"ec of &abor and 'mployment ordered immediate holding of certification election.
+ursuant to this, union sought for payment of wage differentials which left unheeded and also
resulted to the termination of worers. 5ompany said they were being terminated owing to the completion
of its pro6ects or the e-piration of contracts.
N&R5A &A( pro6ect employees .ZZ/
0ssue( <%N they were pro6ect employees
Held( E'"
Ratio(
1. 5ontracts showed that(
hired for specific pro6ects
employment coterminous with completion of pro6ect for which they ha!e been hired
informed in ad!ance that said pro6ect would end on a stated or determinable date
2. employer regularly submitted reports of termination of ser!ices of pro6ect worers
,. +olicy 0nstruction No. 23( +ro6ect employees are those employed in connection with a particular
construction pro6ect.
Fagcalas !s N&R5
2acts(
+etitioners were employed as leadman, tinsmith, tradeshelper to general cler. They ha!e been
employed for a min number of 1 [
5ompany has been engaged in the bi* of installing air-conditioning and refrigeration e9uipment in
its different pro6ects and 6obsites where complainants ha!e been assigned.
%N August ,3, 1#88, they were dismissed en masse without prior notice and in!estigation.
5omplainants alleged it was due to their insistent demands for payment of money claims as mandated by
law. 5ompany said it was due to completion of pro6ects
N&R5( pro6ect employees
0ssue( <%N they were pro6ect employees
Held( No, they are regular employees
Ratio(
1. performing wor necessary or desirable in the usual bi* off pri!ate respondent
2. mere pro!ision in 5DA recogni*ing contract employment does not sufficiently establish that
petitioners were ipso facto contractual or pro6ect employees
,. continuously employed without interruption
:. company was unable to show e!idence that there had been termination of contracts at the end of
each pro6ect
;. regular employees cannot at the same time be pro6ect employees
A&)-T)5+ !s N&R5(
+ro6ect(
1. within regular or usual bi* of employer company but which is distinct and separate and
identifiable as such
2. outside regular bi*.
0&&'4A& $0"F0""A&(
2or dismissal to be !alid, 2 re9s must concur(
1. employee is afforded due process
2. dismissaly should be for !alid cause as indicated in 282
"ando!al "hipyards !s N&R5
Fagante !s N&R5
2acts(
+etitioner was employed as carpenter by 5onstress +hilippines 0nc from April 1>, 1#83 to march 7,
1#82.
His wor in!ol!ed maing of molds for(
Dridges
Duildings
5harcoal guilder
"ea file
He was ne!er assigned to wor outside plant.
'!ery , months, he was made to sign employment contract relating to a particular phase of wor in a
specific pro6ect.
%n march 7, 1#82, a notice of termination was posted and petitioner was told that his ser!ices were
being terminated because(
1. he was already old
2. contract has e-pired
,. he was not renewed as pro6ect employee
&A( regular employee
N&R5( pro6ect employee pursuant to +0 23( in connection with a particular construction pro6ect
0ssue( <%N he was a pro6ect employee
Held( N%
Ratio(
1. ne!er deployed from pro6ect to pro6ect
2. regularly assigned to perform carpentry wor under the super!ision of the super!isor of the
5arpentry $epartment
,. The determining factor of the status of the any worer is the nature of the wor performed by
latter and the place where he performed his assignment
:. no submission of termination reports
2ernande* !s N&R5
2acts(
+etitioner was hired as labored .silled welder/ by $F 5onssun6i 0nc.
<ored from No!ember ;, 1#>:-Farch 2,, 1#87.
Terminated on the ground that pro6ect was already completed.
&A( regular employees
0ssue( <%N they were pro6ect employees
Held( E'"
Ratio(
1. e!idence showed gaps in between hiring showing that he did not wor continuously but only
intermittently for specific pro6ects
2. Fercado !s. N&R5( only casual employees shall be deemed regular upon ser!ice of 1 year
,. $id not comply with re9uirement under +0 23 that to 9ualify as member of wor pool(
a. worer must still be considered employee of company
b. under obligation to be a!ailable on call
c. not free to offer ser!ices to other employers
:. there was regular submission of termination reports
)E !s N&R5
2acts(
+ri!ate respondents were employed by pri!ate contractor Ri*alino )y in different capacities(
mason
laborer
carpenter
$ismissed.
$efnse(
1. no other bi*
2. hired on a payaw basis
,. after completion of a pro6ect, they were free to find other 6obs
&A( pro6ect employees
N&R5( regular employees
0ssue( <%N they were pro6ect employees
Held( no
Ratio(
N% e!idence showing that(
1. they were hired for specific pro6ect the duration of which had been determined at time of hiring
2. no documents that would show the dates of hiring and termination in relation to a particular
pro6ect
,. no termination reports
:. all of them( wored continuously without ha!ing been laid off for a min of , years and a man of 13
years
;. when one pro6ect was completed, they were immediately reassigned to other pro6ects belonged to
a wor pool
7. W));L4 R)S6 P)R($DS
#1. Right to weely rest day-
a/ 0t shall be the duty of e!ery employer, whether operating for profit or not, to pro!ide each of his
employees a rest period of not less than 2: consecuti!e hours after e!ery 7 consecuti!e normal
woring days.
b/ The employer shall determine and schedule the weely rest day of his employees sub6ect to
collecti!e bargaining agreement and to such rules and regulations as the "ec of &abor may
pro!ide. Howe!er, the employer shall respect the preference of employees as to their weely rest
day when such preference is based on religious grounds.
#2. <hen employer may re9uire wor on rest day
The employer may re9uire his employees to wor on any day(
a/ in case of actual or impending emergencies caused by serious accident, fire, flood, typhoon,
earth9uae, epidemic or other disaster or calamity to pre!ent loss of life and property, or
imminent danger to public safety.
b/ 0n cases of urgent wor to be performed on the machinery, e9uipment, or installation, to a!oid
serious loss which the employer would otherwise suffer.
c/ 0n the e!ent of abnormal pressure of wor due to special circumstances, where the employer
cannot ordinarily be e-pected to resort to other measures1
d/ To pre!ent loss or damage to perishable goof
e/ <here the nature of the wor re9uires continuous operations and the stoppage of wor may result
in the irreparable in6ury or loss to the employer
f/ )nder other circumstances analogous or similar to the foregoing as determined by the "ecretary
of &abor.
#,. 5ompensation for rest day
a/ where an employee is made or permitted to wor on his scheduled rest day,
he shall be paid an additional compensation of at least ,3K of his regular wage.
An employee shall be entitled to such additional compensation for wor performed on
"unday only when it is his established rest day.
b/ where the nature of the wor of the employee is such that he has no regular wordays and no
regular rest days can be scheduled,
he shall be paid an additional compensation of at least ,3K of his regular wage for wor
performed on "undays and holidays.
c/ wor performed on an special holiday
shall be paid an additional compensation of at least ,3K of the regular wage of the
employee.
<here such holiday wor falls on the employees scheduled rest day, he shall be entitled
to an additional compensation of at least ;3K of his regular wage.
d/ where the collecti!e bargaining agreement or other applicable employment contract stipulates
the payment of a higher premium pay than that prescribed under this Article, the employer shall
pay such higher rate.
7oo3 <, R%#e <, Se"tions 1=9
"ection 1. 4eneral statement on co!erage( all employers whether operating for profit or not, including
public utilities operated by pri!ate persons
"ection 2. Dusiness on "undaysAHolidays
All establishments and enterprises may operate or open for business on "undays and holidays
pro!ided that the employees are gi!en the weely rest day and the benefits as pro!ided in this Rule.
"ection ,. <eely rest day- same as &5
"ection :. +reference of employee
The preference of the employee as to his weely day of rest shall be respected by the employer if
the same is based on religious grounds. The employee shall mae nown his preference to the employer
in writing at least > days before the desired effecti!ity on the initial rest day so preferred.
<here, howe!er, the choice of the employees as to their rest day based on religious grounds will
ine!itably result in serious pre6udice or obstruction to the operations of the undertaing and the employer
cannot normally be e-pected it resort to other remedial measures, the employer may so schedule the
weely rest day of their choice for at least 2 days in a month.
"ection ;. "chedule of rest day
a/ where the weely rest is gi!en to all employees simultaneously, the employer shall mae nown
such rest period by means of a written notice posted conspicuously in the worplace at least 1
wee before it becomes effecti!e.
b/ <here the rest period is not granted to all employees simultaneously and collecti!ely, the
employee shall mae now to the employees their respecti!e schedules of weely rest through
written notices posted conspicuously in the worplace at last 1 wee before they become
effecti!e.
"ection 7. <hen wor on rest day authori*ed.
An employer may re9uire any of his employees to wor on his scheduled rest day for the duration
of the following emergency and e-ceptional conditions(
a/ 0n case of actual or impending emergencies caused by serious accident, fire, flood, typhoon,
earth9uae, epidemic or other disaster or calamity, to pre!ent loss of life or property, or in cases
of force ma6eure or imminent danger to public safety.
b/ 0n case of urgent wor to be performed on machineries, e9uipment or installations, to a!oid
serious loss which the employer would otherwise suffer.
c/ 0n the e!ent of abnormal pressure of wor due to special circumstances, where the employer
cannot ordinarily be e-pected to resort to other measures
d/ To pre!ent serious loss of perishable goods
e/ <here the nature of the wor is such that the employees ha!e to wor continuously for > days in
a wee or more, as in the case of the crew members of a !essel to complete a !oyage and in
other similar cases
f/ <hen the wor is necessary to a!ail of fa!orable weather or en!ironmental conditions where
performance or 9uality of wor is dependent thereon.
No employee shall be re9uired against his will to wor on his scheduled rest day e-cept under
circumstances pro!ided in this "ection, pro!ided, howe!er, that where an employee !olunteers to
wor on his rest day under other circumstances, he shall e-press such desire in writing sub6ect to the
pro!isions of "ection > hereof regarding additional compensation.
"ection >. 5ompensation on rest dayA"undayAholiday
a. e-cept those employees referred to under
"ection 2, Rule 1, Doo ,, an employee who is
made or permitted to wor on his scheduled rest
day
Additional compensation of at least ,3K of his
regular wage.
V same if wor is performed on a "unday only when
it is his established rest day
b. where the nature of the wor of the employee is
such that he has no regular wor days and no
regular rest days can be scheduled
Additional compensation of at least ,3K of his
regular wage for wor performed on "undays and
holidays
c. wor performed on any special holiday Additional compensation of at last ,3K of the
regular wage
V where such holiday wor falls on the employee=s
scheduled rest day, he shall be entitled to at an
additional of at least ;3K of his regular wage
d. The payment of additional compensation for
wor performed on regular holiday shall be
go!erned by the Rule :, Doo ,, of these
regulations.
e. <here the collecti!e bargaining agreement or
other applicable employment contract stipulates
payment of a higher premium pay than that
prescribed under this "ection the employer shall
pay such higher rate.
"ection 8. +aid off-days
Nothing in this Rule shall 6ustify an employer in reducing the compensation of his employees for
the unwored "undays, holidays, or other rest days, which are considered, paid off-days or holidays by
agreement or practice subsisting upon the effecti!ity of the 5ode.
"ection #. Relation to agreement
Nothing herein shall pre!ent the employer and his employees or their reps from entering into any
agreement with terms more fa!orable to the employees than those pro!ided herein, or be used to
diminish any benefit granted to the employees under e-isting laws, agreements, and !oluntary employer
practices.
Calte? Regular 92plo-ees vs Calte?, 27 SCRA +./ 5.%6
Nature" Special Civil Action in t'e SC. Certiorari
!acts"
<nion alleged t'at Calte? was guilt- of t'e following non-pa-2ent violations"
nig't-s'ift differential
overti2e pa-
first da--off rates for wor) perfor2ed on a Saturda-
1ssue" W3N Saturda- was t'e da- of rest indicated in t'e CBA
*eld" N3
Ratio"
all CBA su$se=uent to 1.7& 57+, 70, 7., /26 'ad deleted t'e proviso in t'e 1.7& CBA
providing for 2 da-s off
under 1./% CBA, 'ours wor)ed on a Saturda- do not, $- t'at fact alone, necessaril-
constitute overti2e wor) co2pensa$le at pre2iu2 rates of pa-, contrar- to petitioner(s
assertion.
Saturda- is not a rest da- or a da--off $ut nor2al or regular wor) 'ours, co2pensa$le at
regular rates of pa-.
3verti2e onl- w'en it is in e?cess of t'e & 'ours w'ic' constitute t'e regular wor) wee)
t'at suc' e2plo-ee 2a- $e considered as perfor2ing overti2e wor) on t'at Saturda-.
1. 5o!erage
82. The pro!isions of this tile shall apply to employees
in all establishments and undertaings whether for profit or not,
but not to(
go!ernment employees
managerial employees
field personnel
members of the family of the employer who are dependent on him for support
domestic helpers
persons in personal ser!ice of another and
worers who are paid by results as determined by the "ecretary of &abor in appropriate
regulations.
Fanagerial employees- those whose primary duty consists of the management of the
establishment in which they are employed or of a department of subdi!ision thereof, and to other
officers or members of the managerial staff.
2ield personnel- non-agricultural employees who regularly perform their duties away from the
principal place of business or branch office of the employer and whose actual hours or wor in the
field cannot be determined with reasonable certainty.
#1. Right to weely rest day-
c/ 0t shall be the duty of e!ery employer, whether operating for profit or not, to pro!ide each of his
employees a rest period of not less than 2: consecuti!e hours after e!ery 7 consecuti!e normal
woring days.
d/ The employer shall determine and schedule the weely rest day of his employees sub6ect to
collecti!e bargaining agreement and to such rules and regulations as the "ec of &abor may
pro!ide. Howe!er, the employer shall respect the preference of employees as to their weely rest
day when such preference is based on religious grounds.
2. $etermination1 5ompulsory wor1 compensation- #1-#,
Fanila 'lectric 5o !s +ublic )tilities 'mployees Assn, ># +hil :3# .:>/
Nature( +etition to re!iew on certiorari the decision of the 50R
2acts(
'mployees of Fanila 'lectric 5o are claiming added compensation for wor during "undays and
legal holidays.
0ssue( <%N these employees are entitled to additional compensation for wor performed on "undays and
legal holidays
Held( No
Ratio(
2
nd
part of "ection 1 of 5A :::( e-empts public utilities performing some public ser!ice,
from the prohibition of the enactment clause and may compel its employees or laborers to
wor during "undays and legal holidays without paying them said e-tra compensation
0t would be unfair for the law to compel public utilities to pay an additional compensation
to laborers whom they ha!e to compel to wor during "undays and legal holidays, in order
to perform a continuous ser!ice to the public.
0t would be tantamount to penali*ing them for performing public ser!ice during said days
in compliance with the re9uirement of the law and public interest.
+erfecto dissents(
V This means simply that employers engaged in public utilities may or may not the additional
compensation or any additional compensation for compelling their laborers to wor on "undays and
holidays.
C. 0$L(DA4S
#:. Right to holiday pay
a/ '!ery worer shall be paid his regular daily wage during regular holidays, e-cept in retail and
ser!ice establishment regularly employing less than 13 worers.
b/ The employer may re9uire an employee to wor on any holiday but such employee shall be paid a
compensation e9ui!alent to twice his regular rate1 and
c/ As used in this article, Rholiday= includes(
New Eear=s $ay
Faunday Thursday
4ood 2riday
April #
Fay 1
Gune 12
Guly :
No!ember ,3
$ecember 2; and ,3
$ay designated by law for holding a general election
'-ecuti!e %rder No. 23, .1#8>/
election day no longer in list
No!ember 1 and $ecember ,1 are called special days
13 regular holidays(
Ganuary 1
Faundy Thursday
4ood 2riday
April #
&abor $ay
0ndependence $ay
National Heroes $ay .&ast "unday of August/
Donifacio $ay
$ecember 2;
Ri*al $ay
Doo ,, Rule :, 0RR
This rule shall apply to all employees e-cept(
a/ those of the go!ernment and any of the political subdi!ision, including 4%55s
b/ those of retail and ser!ice establishment regularly employing less than 13 worers
c/ domestic helpers and persons in the personal ser!ice of another
d/ managerial employees as defined in Doo , of this 5ode
e/ field personnel and other employees whose time and performance is unsuper!ised by the
employer including those who are engaged on tas or contract basis, or those who are paid a
fi-ed amount for performing wor irrespecti!e of the time consumed in the performance thereof.
"ection 2. "tatus of employees paid by the month
'mployees who are uniformly paid by the moth, irrespecti!e of the number of woring days
therein, with a salary of not less than the statutory or established minimum wage shall be presumed to be
paid for all days in the moth whether wored or not.
2or this purpose, the monthly minimum wage shall not be less than the statutory minimum wage
multiples by ,7; days di!ided by 12.
"ection ,. Holiday pay
'!ery employer shall pay his employees their regular daily wage for any unwored regular holiday.
"ection :. 5ompensation for holiday wor
any regular holiday, not e-ceeding 8 hours
at least 233K of his regular daily wage
if holiday falls on scheduled rest day
additional premium of ,3K of his regular holiday rate of 233K based on his regular wage
rate
"ection ;. %!ertime pay for holiday wor
e9ui!alent to his rate for the 1
st
8 hours on such holiday wor plus at least ,3K thereof
regular holiday-rest day rate( 233K of his regular daily wage rate plus ,3K thereof
"ection 7. Absences
a. All co!ered employees shall be entitled to the benefit pro!ided herein when they are on lea!e of
absence with pay. 'mployees who are on lea!e of absence without pay on the day immediately preceding
a regular holiday may not be paid the re9uired holiday pay if he has not wored on such regular holiday.
b. 'mployees shall grant the same percentage of the holiday pay as the benefit granted by competent
authority in the form of employee=s compensation or social security payment, whiche!er is higher, if they
are not reporting for wor while on such benefits.
c. <here the day immediately preceding the holiday is a non-woring day in the establishment or the
scheduled rest day of the employee, he shall not be deemed to be on lea!e of absence on that day, in
which case he shall be entitled to the holiday pay if he wored on the day immediately preceding the non-
woring day or rest day.
"ection >. Temporary or periodic shutdown and temporary cessation of wor
a/ ---X, as when a yearly in!entory or when the repaid or cleaning of the machineries and
e9uipment is undertaen, the regular holidays falling within the period shall be compensated in
accordance with this Rule.
b/ The regular holiday during the cessation of operation of an enterprise due to business re!erses as
authori*ed by the "ec of &abor may not be paid by the employer.
"ection 8. Holiday pay of certain employees
a( private school teachers, including faculty of colleges and universities, may not be paid for the regular holidays during semestral vacations.
/hey shall, however, be paid for the regular holidays during )hristmas vacation.
b/ <here a co!ered employee is paid by the results or output, such as payment on piece wor, his
holiday pay shall not be less than his a!erage daily earnings for the last > actual woring days
preceding the regular holiday1 pro!ided, howe!er that in no case shall the holiday pay be less
than the applicable minimum wage rate.
c/ "easonal worers may not be paid the re9uired holiday pay during off-season when they are not
at wor.
d/ <orers who ha!e no regular woring days shall be entitled to the benefits pro!ided in this rule.
"ection #. Regular holiday falling on rest days or "undays
a/ A regular holiday falling on the employee=s rest day shall be compensated accordingly.
b/ <here a regular holiday falls on a "unday, the following day shall be considered a special holiday
for purposes of the &5, unless said day is also a regular holiday
"ection 13. "uccessi!e regular holidays.
<here there are 2 successi!e regular holidays,,, an employee may not be paid for both holidays if
he absents himself from wor on the day immediately preceding the 1
st
holiday unless he wors on the 1
st
holiday, in which case he is entitled to his holiday pay on the 2
nd
holiday.
"ection 11. Relation to agreements
Nothing in this Rule shall 6ustify an employer in withdrawing or reducing any benefit, supplement,
or payment for unwored holidays, as pro!ided in e-isting indi!idual or collecti!e agreement or employer
practice r policy.
1. 5o!erage- #:.a/
FantradeA2FF5 $i!ision 'mployees and <orers )nion !s Dacungan, 1:: "5RA ;13
Nature( +etition for certiorari and mandamus to re!iew the decision of Arbitrator 2. Dacungan
2acts(
Fonthly paid employees of Fantrade $e!elopment 5orporation sees court remedy for them to
be granted holiday pay.
0ssue( <%N monthly paid employees are 9ualified for holiday pay
Held( Ees
0nsular Dan of Asia and American 'mployees )nion !s 0nciong(
82 of &5( clear the monthly paid employees are not e-cluded from the benefits of holiday pay
5hartered Dan 'mployees Association !s %ple(
<hile the additional e-clusion is only in the form of a presumption that all monthly paid
employees ha!e already been paid holiday pay, it constitutes taing away or a depri!ation which must be
in law if it is to be !alid. An administrati!e interpretation which diminishes the benefits of labor more than
what the statute delimits or withholds is ob!iously ultra !ires.
2. Holiday +ay-#: .b/
a. 2aculty in pri!ate school
Doo ,, Rule :, "ec 8
a/ +ri!ate school teachers, including faculty members of colleges and uni!ersities, ay not be paid for
the regular holidays during semestral !acations. They shall howe!er, be paid for the regular
holidays during 5hristmas !acation.
,ose Ri8al College vs NLRC, 1%0 SCRA 27 5/76
Nature( +etition for certiorari with preliminary in6unction to re!iew the decision of the N&R5
!acts"
;'e National Alliance of teac'ers and 3ffice Wor)ers 5NA;3W6 filed a co2plaint against t'e
college for alleged non-pa-2ent of 'olida- pa- to its facult- w'o are paid per lecture 'our.
1ssue" W3N facult- w'o according to t'eir contracts are paid per lecture 'our are entitled to unwor)ed
'olida- pa-
*eldDRatio"
No to unwor)ed regular 'olida-s" t'ese are specified $- law and are )nown to $ot' sc'ool and facult-
2e2$ers as no class da-s
suc' teac'ers do not e?pect pa-2ent for said unwor)ed da-s, and t'is was clearl- in t'eir
2inds w'en t'e- entered into t'e contracts
Law and 1RR are silent as to pa-2ent on Special #u$lic *olida-s"
Ces, according to court.
H W'en a special pu$lic 'olida- is declared, t'e teac'er paid $- t'e 'our is deprived of e?pected inco2e,
and it does not 2atter t'at t'e sc'ool calendar is e?tended in view of t'e da-s or 'ours lost, for t'eir
inco2e t'at could $e earned fro2 ot'er sources is lost during t'e e?tended da-s.
b. $i!isor as 2actor
/rans*Asia 5hil -mployees Association vs ,R), 0%1 S)RA 03" (&&(
ature7 Special )ivil Action in the S). )ertiorari.
6acts7
:nion entered into )=A which provided for the payment of holiday pay with a stipulation
that if an employee is permitted to work on a legal holiday, the said employee will receive a salary
e8uivalent to %11> of the regular daily wage plus a !1> premium pay.
/o compute for compensation, the company used the %'! divisor which already takes into
account the 11 regular holidays in a year.
0!# calendar days minus unworked and unpaid #% Sundays and %! Saturdays (re8uired to
work half*day(.
4ssue7 ?9 holiday pay is already included in petitioner@s monthly salary
<eld7 Aes
Ratio7
consistent use of %'! divisor establishes inclusion
)hartered =ank -mployees Association vs 9ple7
A to case at bar because there, the bank used different divisors in computing for its
employees benefits and deductions
)ourt modified divisor based on ff computation7
%#1* ordinary working days
11* regular holidays
% days* special days
%!% days
%!* Saturdays when employees are re8uired to work half day
%'' days
but there are only & unworked but paid legal holidays beco. under -9 %10, one always falls on the
last Sunday of August, ational <eroes Bay
c. "unday
?ellington 4nvestment 4nc vs /rajano, %3# S)RA #!1 (&#(
ature7 Special )ivil Action in the S). )ertiorari.
6acts7
9n August !, 1&&1, a routine inspection was conducted by a ,abor -nforcement 9fficer of
the ?ellington 6lour $ills.
/he report found company guilty of nonpayment pf regular holidays falling on a Sunday for
monthly paid employees.
4ssue7 ?9 a monthly paid employee is entitled to an additional pay aside from his usual holiday
pay, whenever a regular holiday falls on a Sunday
<eld7 9
Ratio7
no provision of law re8uiring any employer to make adjustments in his employees@
monthly salaries on the number of times that a legal holiday fell on a Sunday
?hat the law re8uires7
to assure that the monthly minimum wage shall not be less than the statutory
minimum wage multiplied by 0!# days divided by 1%
to pay that salary for all days in the month whether worked or not and irrespective of
the number of working days therein
D. SERVICE INCENTIVE LEAVE AND PATERNITY LEAVE
95. Right to service incentive leave
a) ever e!"loee #ho has ren$ere$ at least % ear o& service shall 'e entitle$ to a earl
service incentive leave o& 5 $as #ith "a.
') This "rovision shall not a""l to
those #ho are alrea$ en(oing the 'ene&it herein "rovi$e$
those en(oing vacation leave #ith "a o& at least 5 $as an$
those e!"loe$ in esta'lish!ent reg)larl e!"loing less than %* e!"loees or
in esta'lish!ents e+e!"te$ &ro! granting this 'ene&it ' the Sec o& La'or a&ter
consi$ering the via'ilit or &inancial con$ition o& s)ch esta'lish!ent.
c) The grant o& 'ene&it in e+cess o& that "rovi$e$ herein shall not 'e !a$e a s)'(ect o&
ar'itration or an co)rt or a$!inistrative action.
,oo- ./ R)le 5/ IRR
Section %. Coverage
This r)le shall a""l to all e!"loees e+ce"t0
a. those o& the govern!ent an$ an o& its "olitical s)'$ivisions/ incl)$ing 12CCs
'. $o!estic hel"ers an$ "ersons in the "ersonal service o& another
c. !anagerial e!"loees
$. &iel$ "ersonnel ++3
e. those #ho are alrea$ en(oing the 'ene&it herein "rovi$e$
&. those en(oing vacation leave #ith "a o& at least 5 $as an$
g. those e!"loe$ in esta'lish!ents reg)larl e!"loing less than %* e!"loees.
Section 4. Right to service Incentive leave
Ever e!"loee #ho has ren$ere$ at least % ear o& service0 5 $as #ith "a
Section .. De&inition o& certain ter!s
At least % ear service0 service #ithin %4 !onths/ #hether contin)o)s or 'ro-en rec-one$ &ro! the
$ate the e!"loee starte$ #or-ing/ incl)$ing a)thori5e$ a'sences an$ "ai$ reg)lar holi$as )nless
the #or-ing $as in the esta'lish!ent as a !atter o& "ractice or "olic/ or than "rovi$e$ in the
e!"lo!ent contract is less than %4 !onths/ in #hich case sai$ "erio$ shall 'e consi$ere$ % ear.
Section 6. Accr)al o& 'ene&its
Entitle!ent to the 'ene&it shall start Dece!'er %7/ %985/ the $ate the a!en$ator "rovision
o& the Co$e too- e&&ect.
Section 5. Treat!ent o& 'ene&it
The service incentive leave shall 'e co!!)ta'le to its !one e9)ivalent i& not )se$ or
e+ha)ste$ at the en$ o& the ear.
Section 7. Relations to agree!ents
Nothing in the R)le shall ()sti& an e!"loer &ro! #ith$ra#ing or re$)cing an 'ene&its/
s)""le!ents or "a!ents as "rovi$e$ in e+isting in$ivi$)al an$ collective agree!ents or e!"loer:s
"ractices or "olicies.
#aternit- Leave Act of 1..0- see A8ucena
1. 5o!erage
Faati Haberdashery !s N&R5, 1># "5RA ::# .8#/
Nature" #etition for certiorari to review t'e decision of t'e NLRC
!acts"
#elo$ello and Rivera, a sales2an for *a$erdas'er- were leaving toget'er w'en t'e- were found wit' an
open pac)age containing a 4usi $arong ;agalog. Conse=uentl- dis2issed after t'e- failed to su$2it an
e?planation to co2pan-.
<nion was t'en filing an action against co2pan- for"
underpa-2ent of
$asic wage
living allowance
non-pa-2ent of
'olida- pa-
service incentive pa-
1+
t'
2ont' pa-
$enefits provided for under Wage 3rders 1,-%
1ssue" W3N e2plo-ees paid on piece-rate $asis are entitled to service incentive pa-
*eld" N3, fall under e?ceptions set fort' in t'e i2ple2enting rules
Ratio"
H as piece-rate wor)ers $eing paid at a fi?ed a2ount for perfor2ing wor) irrespective of ti2e consu2ed
in t'e perfor2ance t'ereof, t'e- fall under t'e e?ceptions. Also not entitled to 'olida- pa-.
La$or Congress vs NLRC, 2.& SCRA %&. 5./6
Nature" Special Civil Action in t'e SC. Certiorari
!acts"
## employees of 'mpire 2ood +roducts .repacing snac food/ allegedly abandoned their wor on
Ganuary 21, 1##1. "ecurity 4uard 5airo testified that said worers refused to wor which resulted in the
spoilage of cheese curls.
1ssue" W3N t'e- were regular e2plo-ees
*eld" C9S, piece-rate wor)ers considered as regular e2plo-ees
5iece*rate7 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
Ratio"
t'eir 4o$ was necessar- and desira$le to $i8 52anufacture and selling of food products6
e2plo-2ent was not dependent on a specific pro4ect or season
lengt' of ti2e t'e- 'ave $een wor)ing for respondents
t'e- are entitled to"
'olida- pa- 5Section /5$6, Rule , Boo) +6
1+
t'
2ont' pa- 5no 2 of 1+
t'
2ont' pa- law6
overti2e pa-
2. +aternity &ea!e- "ec 1-7
'. "'RC05' 5HAR4'"
#7. ser!ice charges
All ser!ice charges collected by hotels, restaurants and similar establishments shall be distributed
at the rate of 8;K for all co!ered employees and 1;K for management. The share of the employees shall
be e9ually distributed among them. 0N case the ser!ice charge is abolished the share of the co!ered
employees shall be considered integrated in their wages.
Doo ,, Rule 7, 0RR
"ection 1. 5o!erage.
%nly to establishments collecting ser!ice charges such as hotels, restaurants, lodging houses,
night clubs, coctail lounges, massage clinics, bars, casinos and gambling houses, and similar enterprises,
including those entities operating primarily as pri!ate subsidiaries of the go!ernment.
"ection 2. 'mployees co!ered
all employees of co!ered employers
regardless of their positions, designations or employment status
and irrespecti!e of the method by which their wages are paid, e-cept to managerial
employees.
As used herein, a managerial employee shall mean one who is !ested with powers or prerogati!es
to lay down and e-ecute management policies andAor to hire, transfer, suspend, lay-off, recall,
discharge, assign, or discipline employees or to effecti!ely recommend such managerial actions.
All employees not falling within this definition shall be considered ran-and-file employees.
"ection ,. $istribution of ser!ice charges
8;-1;
1;K shall be for disposition by management to answer for the losses and breaages and
distribution to managerial employees at the discretion of the management in the latter
case.
"ection :. 2re9uency of distribution
The shares referred to herein shall be distributed and paid to the employees not less than once
e!ery 2 wees or twice a month at inter!als not e-ceeding 17 days.
"ection ;. +ermanency of ser!ice charges
0n case the ser!ice charge is abolished, the share of co!ered employees shall be considered
integrated in their wages. The basis of the amount to be integrated shall be the a!erage monthly share of
each employee for the past 12 months immediately preceding the abolition or withdrawals of such
charges.
"ection 7. Relation to agreements
-"ame-
"ection >. This rule shall be without pre6udice to e-isting and future 5DAs.
Nothing in this rule shall be construed to 6ustify the reduction or diminution if any benefit being
en6oyed by any employee at the time of effecti!ity of this rule.
'astern Assurance and "urety 5orp !s "ecretary of &abor
Nature( "pecial 5i!il Action of certiorari to re!iew the order of the "ec of &abor
2acts(
G M D Fanpower "pecialist, 0nc applied for a license with the +%'A to engage in business as a recruitment
agency.
They, together with 'astern Assurance filed a surety bond to ensure faithful compliance of rules and
regulations promulgated by Finistry of &abor.
"ubse9uently, GD failed to deploy ,, complainants and the latter filed claims for refund.
0ssue( <%N +%'A has 6urisdiction o!er case
Held( E'"
Ratio(
Rule-maing power of "ec ga!e +%'A on its own initiati!e or upon filing of a complaint or report or upon
re9uest for in!estigation by any aggrie!ed person to conduct the necessary proceedings for the
suspension or cancellation of the license or authority..
0mplicit here is the award of appropriate relief to the !ictims .claims for refund granted/
0ssue( <%N "ec of &abor has 6urisdiction
Held( Ees, because these are complaints for !iolation of Articles ,2 and ,:.a/ of &abor 5ode
,2. 2ees to be paid by worers
,:. +rohibited practices
a/ to charge ---Xany amount greater than that specified in the schedule of fees
The penalties of suspension and cancellation of license or authority are imposed and the "ec has the
power under "ection ,; of the law to apply these sanctions
And in section ,7 not only to restrict and regulate the recruitment and placement acti!ities of all agencies
but also to promulgate rules and regulations to carry out the ob6ecti!es and implement the pro!isions
go!erning said acti!ities.
'A"5% no longer liableZ N%. was notifiedAsummoned prior to the e-piration period of bond or before
Ganuary 12, 1#87.
;. Gurisdiction
;.1. RT5 o!er !iolations
"ection #, RA 83:2. Cenue
A criminal action arising from illegal recruitment(
1. shall be filed at RT5
of the pro!ince or city where the offense was committed or
where the offended party actually resides at the time of the commission of the offense
2. +ro!ided that(
once first court has ac9uired 6urisdiction, the other courts are e-cluded therein
said pro!isions shall also apply to those criminal actions that ha!e already been filed in court at
the time of the effecti!ity of this Act.
;.2. &A o!er money claims
"ection 13. Foney claims
5ases(
claims arising out of an '' relationship
or by !irtue of any law or contract in!ol!ing 2ilipino worers for o!erseas deployment
claims for actual, moral, e-emplary and other forms of damages
<ho( &abor Arbiters of N&R5
<hat( original and e-clusi!e 6urisdiction
<hen( within #3 calendar days after filing of complaint
Goint and se!eral liability( for principal and agency
pro!ision is incorporated in the contract for o!erseas employment
shall be condition precedent for its appro!al
%n performance bonds(
file by recruitmentA placement agency
answerable for all money claims or damages that may be awarded to worers
6uridical persons= corpo officers, directors, and partners shall be 6ointly and solidarily liable.
%n liabilities(
shall continue during the entire period or duration of employment contract
shall not be affected by any
substitution
amendment or
modification
made locally or in a foreign country
The following shall be paid within : months from the appro!al of the settlement(
compromise settlement
amicable settlement
!oluntary agreement on money claims inclusi!e of damages
Termination of o!erseas employment without 6ust, !alid or authori*ed cause(
full reimbursement of hit placement fee
with 12K interest per annum
plus his salaries for the une-pired portion of his employment or
for , months for e!ery year of the une-pired term, whiche!er is less
Non-compliance with the mandatory periods for case resolutions shall result to(
1. salary withheld until official complies therewith
2. suspension for not more than #3 days
,. dismissal from ser!ice with $I to hold any appointi!e public office for ; years
\ without pre6udice to any liability incurred under other e-isting laws or rules as a conse9uence of
!iolating the pro!isions of this paragraph
;., +%'A o!er administrati!e and disciplinary cases
"ection 28, RA 83:2. 5ountry-Team Approach
all officers, reps, and personnel of +hil go!t posted abroad
shall act as one country-team
with a mission
under the leadership of the ambassador
The ambassador may(
recommend to the "ec of $ept of 2oreign Affairs
the recall of %R+
for acts inimical to the national interest
such as, but not limited to, failure to pro!ide the necessary ser!ices to protect the rights
of o!erseas 2ilipinos
The "ec of $2A shall(
endorse such recommendation
to the dept secretary concerned for appropriate action
pending action, person recommended for recall may be placed under pre!enti!e
suspension
5onsulates shall also be part of country-team.
0n the implementation of this approach,
!isiting +hilippine delegations shall be pro!ided full support and information
D. +ublic "ector Agencies
12 .f/ to strengthen the networ of public employment offices ..yada yada yada
1: .a/ to organi*e and establish new employment offices ---X as the need arises
"ection ,, '% 2:> .Reorgani*ing the +%'A/
+owers and 2unctions of +%'A(
a. regulate pri!ate sector participation in the recruitment and o!erseas placement of worers by
setting up a licensing and registration system
b. formulate a system for promoting and monitoring the o!erseas employment of 2ilipino worers
taing into consideration their welfare and domestic manpower re9uirement
c. protect rights to fair and e9uitable RA' practices and ensure their welfare
d. original and e-clusi!e 6urisdiction
all claims from '' relationship
or by !irtue of contract
disciplinary cases
pre-employment cases which are
* administrati!e in character
* arising from !iolation of re9uirement laws
!iolation of rules and regulations including money claims arising therefrom
!iolation of conditions for issuance of license or authority to recruit worers
+enal( regular courts in close coordination with appropriate depts. And agencies
e. maintain a registry of sills for o!erseas placement
f. recruit and place to ser!ice the re9uirement for trained and competent 2< by foreign go!ts and
their instrumentalities and such other employers as public interest may re9uire
g. promote de!elopment of sills and careful selection of 2ilipino worers for %'
h. undertae % maret de!elopment acti!ities for placement of worers
i. secure best terms and conditions
6. promote and protect well-being
. de!elop and implement programs for the effecti!e monitoring of returning contract worers,
promoting their retraining and re-employment or their smooth re-integration into the mainstream
of the national economy in coordination with other go!t agencies
l. institute a system for ensuring a fair and speedy disposition of cases
m. speedy and efficient reinforcement of decision laid down through the e-ercise of its ad6udicatory
functions
n. establish and maintain close relationship and enter into 6oint pro6ects with the
$2A
+TA
F0AA
$%G
$ept of Dudget and Fanagement
'tc
Also establish and maintain 6oint pro6ects with pri!ate orgs, domestic or foreign
c. "anctions
,;. "uspension andAor cancellation of &icense or Authority
iFinister of &abor(
suspended or can any license or authority
for !iolations of rules and regulations issued by
Finistry of &abor
%!erseas 'mployment and $e!elopment Doard
National "eamen Doard
%r for !iolation of the pro!isions of this and other applicable laws, general orders and
letters of instruction
,#. +enalties
Ciolation +enalty
0llegal recruitment constitutes economic sabotage &ife imprisonment AN$
133 thou
&icense or holder of authority !iolating any
pro!ision of this title or its RAR
2-; years %R
13-;3thou %R
both
Nonholder of either !iolates pro!ision :-8 years %R
23-133thou %R
Doth
Guridical persons commit !iolation %fficer gets penalty
Aliens get deported
0n all cases, con!iction shall cause(
automatic re!ocation of license or authority
all permits and pri!ileges
forfeiture of cash and surety bonds
in fa!or of %!erseas 'mployment $e!elopment Doard or the National "eamen=s Doard
who will use the same to promote their ob6ecti!es
Note( Article ,8U 0llegal recruitment
c. The minister of &abor and 'mployment or his reps shall ha!e power to cause arrest and detention of
such nonlicensee or non-holder of authority if after in!estigation it is determined that his acti!ities
constitute a danger to national security and public order or will lead to further e-ploitation of 6ob-seeers.
The Finister shall order the search of the office or premises and sei*ure of docus, paraphernalia,
properties, and other implements used in illegal recruitment acti!ities and closure of companies,
establishment, and entities found to engaged in the recruitment of worers for %', without ha!ing been
licensed to do so.
--declared unconstitutional per 5onst Article ,, "ec 2
"ala*ar !s Achacoso, 18, "5RA 1:; .#3/
2. Alien 'mployment Regulation
Article 12, "ec 12, 5onsti(
The "tate shall promote the preferential use of 2ilipino labor, domestic materials and locally
produced goods, and adopt measures that help mae them competiti!e.
Article :3. 'mployment permit of non-resident aliens
alien seeing admission for employment
domestic or foreign employer who desires to engage an alien for employment in the +hilippines
The employment permit may be issued(
to a non-resident alien or
to the applicant employer
after a determination of the non-a!ailability of a person in the +hilippines
who is competent, able and willing
at the time of the application
to perform the ser!ices for which the alien is desired
to an enterprise registered in preferred areas of in!estments
upon recommendation of the go!ernment agency charged with the super!ision of said
registered enterprise
Article :1. +rohibition against transfer of employment
a. alien cannot transfer to another 6ob or change employer without appro!al of "ec
b. 28# and 2#3 shall apply for non-resident alien who shall tae up employment in !iolation of this title
and its rAr
.1-13 thou or , months-, years or both/
.imposed on guilty officers/
Alien worer shall be sub6ect to deportation after ser!ice of his sentence.
Article :2. "ubmission of list
'mployer of non-resident foreign nationals shall(
submit a list of such nationals with "o&
within ,3 days after such date
indicating their
names
citi*enship
foreign and local addresses
nature of employment
status of stay
"o& shall then determine if they are entitled to an employment permit.
Notes(
'mployment of aliens
resident aliens are not re9uired to secure employment permit
A&0'N 'F+&%EF'NT R'40"TRAT0%N 5'RT0205AT' .aerc/- for immigrants and resident aliens
2oreigners may not be employed in certain nationali*ed business e-cept(
where "ecretary of Gustice specifically authori*es the employment of technical personnel
where the aliens are elected members of the board or go!erning body of corpos or
associations in proportion to their allowable participation in the capital of such entities
enterprises registered under %mnibus 0n!estment 5ode .'/ 227/ may, for a limited period
?in technical, super!isory, or ad!isory positions
0mplementing rules
Doo 1, Rule 1:, "ec. ;( nonresident alien worer and employer must train at least 2 2ilipino understudies
for a period to be determined by "&'
"ection 7( 0ssuance of 'mployment +ermit- The "ec may issue an employment permit based on(
1. compliance by the applicant and his employer with the re9uirements of "ection 2 hereof
2. report of the Dureau $irector as to the a!ailability or non-a!ailability of any person in the
+hilippines who is competent and willing to do the 6ob for which the ser!ices of the applicant are
desired
,. his assessment as to <%N the employment of the applicant will redound to national interest
:. admissibility of the alien as certified by the 5ommission on 0mmigration and $eportation
;. The recommendation of the Doard of 0n!estments or other appropriate go!ernment agencies if the
applicant will be employed in preferred areas of in!estments or ina accordance with the
imperati!e of economic de!elopment
a. 5o!erage
Almodiel !s N&R5, 22, "5RA ,:1 .#,/
Nature( +etition for certiorari of the decision of the N&R5
2acts(
&abor Arbiter( declared his termination on the ground of redundancy illegal
N&R5( re!ersed and set aside &abor Arbiter=s decision
* ordered payment of separation pay and financial assistance of 133thou
* 6ustified termination due to redundancy
2arle Almodiel was hired by Raytheon +hilippines, 0nc for the position of 5ost Accounting Fanager with the
following ma6or duties(
plan, coordinate and carry out year and physical in!entory
formulate and issue out hard copies of "tandard +roduct costing and other pricing analysis if
needed an re9uired
set up the 5ost Accounting "ystem for the whole company
<hen the stndard cost accounting system was installed and used at the plants, his ser!ices became
limited to the submissio of periodic reports that would use computeri*ed forms prescribed and designed
by the international head office of the Raytheon 5ompany in 5alifornia.
Ganuary 2>, 1#8#- was told of the abolition of his position on the ground of redundancy
0ssue( <%N bad faith, malice and irregularity crept in the abolition of his position on the ground of
redundancy
Held( N%
Ratio(
employer is under no legal obligation to eep more employees than are necessary for the
operation of its bi*
fact that the functions of the position were simply added to the duties of another does not affect
the legitimacy of the employer=s right to abolish a position when done in the normal e-ercise of its
prerogati!e to adopt sound business practices in the management of its affairs
employer has much wider discretion in terminating employment relationship of managerial
personnel compared to ran and file
As to functions being absorbed by $anny Ang Tan 5hair, resident alien without a woring permit(
Article :3 refers to non-resident aliens only
5laim that he is better 9ualified( untenable
Ang Tan 5hai was also promoted prior to the abolition of his position
b. 5onditions for 4rant of +ermit
$%&' Re!ised 4uideline for the 0ssuance of Alien 'mployment +ermit .Ganuary :, 1#88/
7R)N6 SC0$$L (NC. ,S. >AM$RA
NA6/R). +etition to re!iew decision of the %ffice of the +resident
-AC6S.
Alegre was enga!ed as athletic director by Drent "chool 0nc. for a fi-ed term of ; years.
About , months before the e-piration of the stipulated period, he was gi!en a copy of the report filede by
Drent "chool with $%&' ad!ising it of the termination of his ser!ices upon the e-piration of his contract.
The ground for the termination was @completion of contract, e-piration of the definite period of
employmentH
At the in!estigation conducted by a &abor 5inciliator of the report of termination opf his ser!ices, Alegre
protested the announced termination of his employment, arguing that although his contract did stipulate
that the same would terminate on Guly 1>, 1#>7, since his ser!ices were necessary and desirable in the
usual business of his employer, and his employment had lasted for ; years, he had ac9uired the status of
a regular employee and could not be remo!ed e-cept for !alid cause.
Regional $irector re9uired the reinstatement of Alegre, as a Hpermanent employee,H to his former
position without loss of seniority rights and with full bacwages
"ec. of &abor sustained Reg@l. $irector
Drent appealed to the %ffice of the +resident which affirmed the &abor "ecretary@s decision1 hence this
appeal.
(SS/). <%N Alegre is a permanent employee who can only be remo!ed for !alid cause
0)LD. No
RA6($. The entire purpose behind the de!elopment of legislation culminating in the present Art. 283 of
the &5 is the pre!ention of the circum!ention of the employee@s right to be secure in his tenure. The
clause in said article indiscriminately and completely ruling out all written or oral agreements conflicting
with the concept of regular employment as defined therein should be construed to refer to the substanti!e
e!il that the 5ode itself has singled out( agreements entered into precisely to circum!ent security of
tenure. 0t should ha!e no application to instances where a fi-ed period of employment was
16 agreed upon )nowingl- and voluntaril- $- t'e parties, wit'out an- force, duress or i2proper pressure
$eing $roug't to $ear upon t'e e2plo-er and a$sent an- ot'er circu2stances vitiating 'is consent7 or
26 w'ere it satisfactoril- appears t'at t'e e2plo-er and e2plo-ee dealt wit' eac' ot'er on 2ore or less
e=ual ter2s wit' no 2oral do2inance w'atever $eing e?ercised $- t'e for2er over t'e latter.
Also, from the premise--that the duties of an employee entail Hacti!ities which are usually
necessary or desirable in the usual business or trade of the employerH--the conclusion does not
necessarily follow that the employer and employee should be forbidden to stipulate any period of time for
the performance of those acti!ities. There is nothing essentially contradictory between a definite period of
an employment contract and the nature of the employee@s duties set down in that contract as being
Husually necessary or desirable in the usual business or trade of the employer.H The concept of the
employee@s duties as being Husually necessary or desirable in the usual business or trade of the
employerH is not synonymous with or identical to employment wioth a fi-ed term. &ogically, the decisi!e
determinant in term employment should not be the acti!ities that the employee is called upon to perform,
but the da- certain agreed upon by the parties for the commencement and termination of their
employment relationship, a da- certain being understood to be Hthat which must necessarily come,
although it may not be nown when.H "easonal employment, and employment for a particular pro6ect are
merely instances of employment in which a period, where not e-pressly set down, is necessarily implied.
PAL$MAR)S ,S. NLRC
NA6/R). "pecial ci!il action in the "5. 5ertiorari .1##>/
-AC6S.
+etitioners +alomares and Futia were hired by respondent National "teel 5orp. .N"5/ by !irtue of
contracts of employment for its 2i!e Eear '-pansion +rogram .2E'+/.
+etitioners along with other employees filed a consolidated petition for regulari*ation, wage differential,
and other benefits.
+etitioners and : others were ad6udged as regular employees of N"5 by the &abor Arbiter.
N&R5 re!ersed &A decision, saying that petitioners were pro6ect employees and that their assumption of
regular 6obs were mainly due to pealoads or the absence of regular employees during the latter@s
temporary lea!e.
Fotion for recon was denied1 hence this petition.
(SS/). <%N petitioners are regular employees of N"5
0)LD. No
RA6($. The principal test for determining whether an employee is a pro6ect employee and not a regular
employee is whether he was assigned to carry out a specific pro6ect or undertaing, the duration or scope
of which were specified at the time he was engaged for that pro6ect.
Records show that petitioners were hired to wor on pro6ects for 2E'+ 0 and 00-A. %n account of the
e-piraiton of their contracts of employment andAor pro6ect completion, petitioners were terminated from
their employment. They were, howe!er, rehired for other component pro6ects of the 2E'+ because they
were 9ualified.
There is nothing in the records which re!eal an attempt to frustrate petitioners@ security of tenure.
The fact that petitioners were re9uired to render ser!ices necessary or desirable in the operation of N"5@s
business for a specified duration did not in any way impair the !alidity of their contracts of employment
which stipulated a fi-ed duraiton thereof.
AS(A W$RLD R)CR/(6M)N6 (NC. ,S. NLRC
NA6/R). "pecial ci!il action in the "5. 5ertiorari .1###/
-AC6S.
+etitioner Asia <orld Recruitment is a domestic corporation with authority granted by the +%'A to recruit
and deploy 2ilipino o!erseas contract worers abroad, and its principal is Roan "election, a diamond and
gold mining firm in Angola, Africa.
+ri!ate respondent Fedel entered into an employment contract as a "ecurity %fficer in petitioner@s
diamond mine for a period of 12 months.
$uring his employment, Fedel ele!ated the grie!ances of his 2ilipino co-worers to the management,
which apparently strained relations between him and management.
, months after his arri!al .on Farch 13, 1#8#/, Fedel recei!ed a letter of termination signed by the 4en.
Fgr., telling him that the company was not satisfied with his performance within the three-month trial
period and that his employment with the company would be terminated on Farch 1,, 1#8#.
2 days after recei!ing the notice, he was repatriated to the +hils.
Fedel filed a complaint for, among others, illegal dismissal, with the +%'A Ad6uducation %ffice, who
found petitioner and its pricipal solidarily liable for his illegal dismissal.
N&R5 affirmed1 hence this petition.
(SS/). <%N Fedel was illegally dismissed
0)LD. Ees
RA6($. The records clearly showed that Fedel was an employee with a fi-ed period of 12 months. he was
therefore an enmployee hired for a fi-ed term whose employment was to end only at the e-piration of the
period stipulated in his contract. Thus, it is not a simple case of illegal dismissal of an employee whose
employment is without a definite period, rather, the principal cause of action in Fedel@s complaint is
breach of contract of employment for a definite period.
'!en if he was only a probationary employee for a period of , months, as a probationary
employee, he is nonetheless entitled to constitutional protection of security of tenure that no worer shall
be dismissed e-cept for cause pro!ided by law and after due process.
P0(L. 6$7ACC$ ,S. NLRC
NA6/R). "pecial ci!il action in the "5. 5ertiorari .1##8/
-AC6S.
The &ubat 4roup is composed of seasonal worers who were pre!iously hired by petitioner for 7-8
months in its Dalintawa operations but who were no longer rehired for the 1##: tobacco season. <hen
they ased for separation pay, +hil. Tobacco told them that because they were not in the payroll for 1##:,
no such benefit would be paid to them.
The &uris 4roup were factory worers in +hil. Tobacco@s Dalintawa factory who were terminated because
the Dalintawa factory will be closed and transferred to 5andon, 0locos "ur due to alleged serious business
losses. They are contesting the computation of the separation pay awarded to them.
the &A and the N&R5 held that both the &ubat and the &uris groups were entitled to separation pay
e9ui!alent to 1A2 month salary for e!ery year of ser!ice. Hence this petition.
(SS/)S. 1/ <%N &uris group entitled to separation pay1 2/<%N dismissal of &ubat group was legal
0)LD. 1/ Ees1 2/ No
RA6($.
1/ "tandards that a company must meet to 6ustify retrenchment(
a/ the losses should be substantial and not merely de minimis in e-tent
b/ the substantial loss apprehended must be reasonably imminent, as such imminence can be percei!ed
ob6ecti!ely and in good faith by the employer
c/ the retrenchment must be reasonably necessary and liely to effecti!ely pre!ent the e-pected losses
d/ alleged losses if already reali*ed, and the e-pected imminent losses sought to be forestalled, must be
pro!ed by sufficient and con!incing e!idence.
+etitioner did not actually close its entire business. 0t merely transferred or relocated its tobacco
processing and redrying operations. Foreo!er, it was also engaged in, among otehrs, corn and rental
operations, which were unaffected by the closure of its Dalintawa plant.
Tested against the standards mentioned abo!e, petitioner was not able to pro!e serious financial
losses arising from its tobacco operations. The "tatement of 0ncome and '-penses was misleading and
inaccurate because it deducted from the tobacco operations alone the operating costs pertaining to all
businesses of petitioner, maing it appear that all of its e-penses--selling, administrati!e and interest
e-penses--resulted only from its tobacco processing and redrying operations, and that it incurred no
e-pense in its other profit centers.
+etitioner was not able to establish that the closure of its business operations in its Dalintawa
plant was in fact due to serious financial losses. Therefore, under the last 2 sentences of Art. 28, of the
&5, the dismissed employees belonging to the &uris group are entitled to separation pay He9ui!alent to 1
month pay or at least 1A2 month pay for e!ery year of ser!ice, whiche!er is higher.H
+etitioners also illegally dismissed the &ubat group when it refused to allow them to wor during
the 1##: season. The employer-employee relationship between petitioner and members of the &ubat
group was not terminated at the end of the 1##, season. 2rom the end of the 1##, season until the
beginning of the 1##: season, they were considered only on lea!e, but ne!ertheless still in the employ of
petitioner.
S6. M(C0A)L?S (NS6(6/6) ,S. SAN6$S
NA6/R). +etition for re!iew on certiorari .2331/
-AC6S.
"t. Fichael=s 0nstitute is an institute of learning in Dacoor, 5a!ite, and respondents
"antos, Fagcamit and Rosarda were its regular classroom teachers.
"antos, et. al. were ser!ed notices of termination of employment in "eptember 1##,1
"antos has been teaching at "t. Fichael=s since 1#># while the other two began
teaching in 1##3.
Apparently, the termination stemmed from their participation in a public rally in August
1##,1 said rally was organi*ed and participated in by faculty members, parents and
some students of the school aimed at calling the attention of the school admin. to
certain grie!ancesX
After the rally, respondents were sent identical memoranda re9uiring them to e-plain
their acts of leading the rally of students outside of the school premises, pre!enting
students from attending classes and denouncing school authority in their speeches.
Respondents denied all the accusations attributed to them, and e-plained that they
were in!ited by the core group of parents and merely 6oined them in e-pressing their
sentiments.
The school principal created an in!estigation committee1 said committee recommended
their termination from ser!ice.
Their termination letters stated that they were being terminated for Pserious disrespectQ
to their superior, and for Pserious misconduct that resulted in the disruption of classes.Q
Respondents filed complaints for illegal dismissal
&A dismissed the complaints for lac of merit?there was 6ust cause for respondents=
dismissal since they were guilty of dereliction of duty and insubordination for failing to
e-ercise the !ery tas that they are duty-bound to perform as teachers of the school,
that is, to conduct classes on the day of the rally1 also, the willful conduct of
respondents in disobeying the reasonable order of the principal to conduct classes is a
6ust cause for termination and falls within the ambit of Art. 282 of the &5.
N&R5 re!ersed and held that respondents had been illegally dismissed because the rally
which was purposely held to call the school=s attention to the grie!ances of its teachers
and students could hardly be considered as without 6ustification. Also(
o high school faculty formed a labor union during the early part of 1##, and
respondents were among the organi*ers
o certain grie!ances were aired in a dialogue with the school admin but the
dialogue pro!ed futile
o sometime in Farch 1##, the school issued termination notices to the
respondents and , others
o respondents filed illegal dismissal complaint with N&R5 but the case was settled
amicably with the condition that they withdraw their complaint
5A affirmed N&R5 decision1 hence this petition
(SS/). <%N respondents were illegally dismissed
0)LD. Ees
RA6($.
The reason basically cited for the dismissal is serious misconduct or willful disobedience
for dereliction of duty predicated on their absence for only one day of classes for
attending a public rally and denouncing the school authority. The magnitude of the
infraction must be weighed and e9uated with the penalty prescribed and must be
commensurate thereto, in !iew of the gra!ity of the penalty of dismissal or termination
from the ser!ice.
The dismissal meted out on the respondents for dereliction of duty for one school day
and denouncing school authority appears to be too harsh a penalty. The respondents are
being held liable for a first time offense and, in the case of "antos, despite long years of
unblemished ser!ice
0n the actual imposition of penalties upon the erring employee, due consideration must
still be gi!en to his length of ser!ice and the number of !iolations committed during his
employment.
The burden of proof is always on the employer to pro!e that the dismissal was for a 6ust
and !alid cause1 e!idence must be clear, con!incing and free from any inference that
the prerogati!e to dismiss an employee was abused and un6ustly used by the employer
to further any !indicti!e end
o 0n this case, the facts show that respondents were singled out by the school
apparently for being officers of the teachers= union which they formed
Fisconduct( the transgression of some established and definite rule of action, a
forbidden act, a dereliction of duty, willful in character and implies wrongful intent and
not mere error of 6udgment?as a ground for termination, it must be serious .gra!e and
aggra!ated and not merely tri!ial or unimportant/
<illfulness( characteri*ed by a wrongful and per!erse mental attitude rendering the
employee=s act inconsistent with proper subordination.
PERPETUAL HELP CREDT C!!P" #S" $A%URADA
-AC6S.
+erpetual Help hired respondents to wor for it1 they wored regular hours, were
assigned specific duties, paid regular wages and made to accomplish daily time records
6ust lie any other regular employee.
+H550 dismissed them, saying that they were not regular employees but were its
members and were woring for it as !olunteers
Respondents filed a complaint for illegal dismissal with the &A
&A declared respondents illegally dismissed
N&R5 affirmed1 hence this petition
(SS/)S. 1/ <%N respondents were regular employees
2/ <%N respondents were illegally dismissed
0)LD. 1/ Ees1 2/ Ees
RA6($. 1/ respondents were rendering ser!ices necessary to the day-to-day operations of
+H5501 this fact alone 9ualifies them as regular employees.
2/ As regular employees, they are entitled to security of tenure and their ser!ices may
be terminated only for a !alid cause, with obser!ance of due process.
Gust causes .Art. 282/
o serious misconduct or willful disobedience of lawful orders in connection with the
employee=s wor
o gross or habitual neglect of duties
o fraud or willful breach of trust
o commission of a crime or an offense against the employer or his immediate
family member or representati!e
o analogous cases
Authori*ed causes .Arts. 28, M 28:/
o installation of labor-sa!ing de!ices
o redundancy
o retrenchment to pre!ent losses
o closing or cessation of operations of the establishment or undertaing, unless the
closing is for the purpose of circum!enting the pro!isions of law
respondents were not dismissed for the abo!e causes, they were dismissed because
+H550 considered them to be mere !oluntary worers, being its members, and as such
wor at its pleasure.
+rocedural due process re9uires that the employer ser!e the employees to be dismissed
2 written notices before the termination of their employment is effected( a/ the first, to
apprise them of the particular acts or omissions for which their dismissal is sought and
b/ the second, to inform them of the decision of the employer that they are being
dismissed.
0n this case, only one notice was ser!ed upon respondents in the form of a Femo.
5learly, +H550 failed to comply with the twin re9uisites of a !alid notice.
AL-AR$ ,S. CA
NA6/R). +etition for re!iew on certiorari of 5A decision .2331/
-AC6S.
Alfaro was employed by "tar +aper as a helperAoperator
He too a sic lea!e for 12 days, and was surprised upon his return to wor that
another worer was recruited to tae his place, and that he was instead transferred
to the wrapping section where the woring conditions are more difficult
<hen he complained that he was being e-posed to hard labor despite the fact that
he had 6ust come from an illness, he was told to loo for another 6ob because he was
dismissed effecti!e that day
He was made to sign documents which indicated that he was renouncing claims
against "tar +aper
He was offered a chec of +,333 which will be gi!en to him if he will sign the
documents1 forced by circumstances, he did sign the documents which were( a
resignation letter and a Release and Iuitclaim
Alfaro filed a complaint for separation pay, later amended to illegal dismissal
&A dismissed, and N&R5 and 5A affirmed?they said that Alfaro resigned !oluntarily1
hence this petition
(SS/). <%N Alfaro was illegally dismissed
0)LD. No
RA6($.
There is no e!idence which shows that he was pressured and made to sign a resignation
letter and Release and Iuitclaim against his will and better 6udgment1 this shows that
his claim of illegal dismissal is unsubstantiated and a mere afterthought
0f he was indeed illegally dismissed, he should ha!e pursued his claim against "tar +aper
by immediately filing a complaint for illegal dismissal. As it is, howe!er, he filed a
complaint for separation pay only after two years from his alleged dismissal which
complaint was amended for the purpose of claiming 0$ almost 2 mos. Thereafter
Coluntary resignation( an act of an employee, who finds himself in a situation in which
he belie!es that personal reasons cannot be sacrificed in fa!or of the e-igency of the
ser!ice1 thus he has no other choice but to disassociate himself from his employment
He negotiated for a resignation with separation pay as the manner in which his
employment relations with "tar +aper would end. He was already suffering from a
lingering illness at the time he tendered his resignation.
His continued employment would ha!e been detrimental not only to his health, but also
to his performance as an employee therein1 hence, the termination of employment
relations between Alfaro and "tar +aper was ultimately, if not outrightly ine!itable.
Resignation with separation pay was the best option for him under the circumstances.
$C)AN )AS6 A@)NC4 ,S. NLRC
NA6/R). "pecial ci!il action in "5. 5ertiorari .1##8/
-AC6S.
Respondent 5apt. 4ucor was hired by %cean 'ast .manning agent of 'uropean
Na!igation or 'N0/ for a period of one year as master of FAC Alpine
He was later informed of his repatriation for his subse9uent transfer to another
!essel
He percei!ed the transfer as an insult to his professional competence, and said that
unless his full benefits are accorded to him he shall refuse to lea!e the !essel
nowing the cause for his repatriatin to be unreasonable
%cean 'ast and 'N0 ad!ised him that his ser!ices were not terminated at all, the
repatriation being solely for documentation purposes
His demands fully settled, he agreed to be repatriated
"ince his original assignment was already assigned to someone else due to his initial
refusal to be repatriated, he was instrad assigned to FAC 'leptheria-B
He missed said assignment for failure to disembar when ordered to do so
His ser!ices were terminated for serious misconduct or willful disobedience
4ucor filed a complaint for 0$ with the +%'A
+%'A dismissed for lac of merit, saying that %cean 'ast and 'N0 were merely acting
in the e-ercise of their management prerogati!e
N&R5 re!ersed and found for 4ucor1 hence this petition
(SS/). <%N he was illegally dismissed
0)LD. No
RA6($.
0n order that an employer may terminate an employee on the ground of willful
disobedience to the former=s order, regulations or instructions, it must be established
that the said orders, regulations or instructions are a/ reasonable and lawful, b/
sufficiently nown to the employee, and c/ in connection with the duties which the
employee has been engaged to discharged
%cean 'ast and 'N0 ha!e conscientiously apprised 4ucor that his repatriation was solely
for documentation purposes preliminary to his transfer to another !essel which the
management belie!es him to be more familiar with.
4ucor=s defiance of a lawful order posed serious and considerable pre6udice to the
business of the employer. %cean 'ast=s order was made within the sphere of its
management prerogati!e. There was a clear, !alid and legal cause for his termination
His refusal to disembar and turn o!er command of his !essel to its new master when
instructed to do so caused great pecuniary damage to his employer. The !essel was at
anchorage for a long time disrupting its schedule. Not only that. He was not able to tae
command of the FAC Ha!re de 4race, forcing 'N0 to mae the arrangements and assign
a new master to it. 'N0, e-ercising ma-imum tolerance in spite of 4ucor=s
insubordination, e!en went as far as assigning him to the 'leptheria-B after he missed
the Ha!re de 4race. He liewise missed this assignment. All this because he belie!ed
that his transfer was an insult to his personal and professional capacity. *e willfull-
diso$e-ed a lawful order of 'is e2plo-er, and 'is act of insu$ordination is a valid ground
for dis2issal.
L!PE& vs" 'LRC
!cto()r *, 1++*
$acts,
Melody Paulino Lopez was employed as a guidance counselor by the elementary department of Letran. She was an
employee of the school from June 1979 to July 1991.
Lopez organized a areer !rientation Program during which the students were able to witness and mingle with
military men in uniform. "fter such e#ent Lopez noticed that there was a conspiracy of harassment$ intimidation and
persecution to ma%e her resign. She also found out that group conspired to ha#e her son %ic%ed out from a school.
She wrote to &r. "larcon about these matters.
Since then$ Lopez became a fre'uent recipient of se#eral memoranda re'uiring her to e(plain se#eral infractions.
)nsa#ory reports un%nown to Lopez also surfaced in her file$ such as an incident report relating that Lopez allegedly
challenged a co*wor%er to a fight
Lopez was replaced as elementary guidance counselor and was gi#en the position of +ead Psychometrician. ,hen
she was about to administer tests to the elementary department$ she was refused entry by the security guard upon
instructions from a certain Mr. Moralino.
Later on$ Lopez was offered a sizable amount of money in e(change for her #oluntary resignation. She refused the
offer.
!n &ebruary 1-$ 1991$ Lopez reported for wor% to assist in gi#ing entrance e(ams to high school students.
Mendoza$ an employee of the guidance counselor.s office as%ed from the guard for the %ey to the office$ but &r. Lao
/who was then with the security guard0$ refused to gi#e the %ey. Mendoza as%ed Lopez to intercede for him. "t this
point$ what actually happened appears rather hazy.
&r. Lao insists that Lopez uttered indecent and obscene remar%s against him$ while Lopez denied this accusation
and in turn accused Lao for embarrassing and humiliating her.
"s a conse'uence of the &ebruary 1- incident$ Lopez was pre#enti#ely suspended for 12 days. She filed a
complaint for illegal suspension. Meanwhile a committee was formed to in#estigate the charges of serious
misconduct against Lopez$ who e(plained her side in writing. !n May 19$ 1931$ Lopez recei#ed notice of her
dismissal from employment on the ground of serious misconduct$ commission of a crime /gra#e oral defamation0$
insubordination$ unfaithfulness to employer.s interest$ 'uarreling and challenging to a fight and loss of confidence4
,+5,6 7he complaint was amended to co#er the illegal dismissal.
7he L" found that Lopez was dismissed for 8ust cause and due process. +owe#er$ it ordered Letran to pay
separation pay. 7he 9L: re#ersed due to absence of 8ust cause and due process but ordered Letran to grant
separation pay in lieu of reinstatement. 7he claim for damages was dismissed.
ssu), ,!9 a finding of an illegal dismissal ipso facto, results in the reinstatement of the dismissed employee
H)l-, 9!
Ratio,
7here is no 'uestion that Lopez was illegally dismissed. Letran failed to establish by concrete and direct e#idence
the charges imputed against Lopez.
Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representati#e in
connection with his wor% is one of the grounds or 8ust causes for termination of an employee. ;ut there was no
serious misconduct in this case because Lopez was merely interceding for another employee when the incident
occurred. Such incident certainly was not in relation to her wor% as +ead Psychometrician.
<n general$ the remedy for illegal dismissal is the reinstatement of the employee to his former position without loss of
seniority rights and payment of bac%wages. ;ut there may be instances when reinstatement is not a #iable remedy
= as in this case = the relations between the employer and the employee ha#e been so se#erely strained that it is
not ad#isable to order reinstatement.
"rt. >79 of the Labor ode$ as amended$ pro#ides that ?an employee who is un8ustly dismissed from wor% shall be
entitled to reinstatement without loss of seniority rights and other pri#ileges and to his full bac%wages$ inclusi#e of
allowances$ and to his other benefits or their monetary e'ui#alent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.?
Pursuant to this rule$ illegally dismissed employees are entitled to@
/10 :einstatement and full bac%wages = both reliefs are a#ailable to the illegally dismissed employee as a matter of
course.
/>0 Separation pay and full bac%wages = if reinstatement is not possible. 7he reliefs of separation pay and
bac%wages are )M)L"7<A5$ not alternati#e.
Bue to the personal animosities that ha#e been generated as a result of the circumstances of this case$
reinstatement would not be in the best interest of the parties. 7hus$ the 9L: correctly awarded separation pay
e'ui#alent to one month.s salary for e#ery year of ser#ice.
+owe#er$ bac%wages should also be awarded in addition to separation pay. <n accordance with the ruling in
;ustamante #s. 9L:$ an illegally dismissed employee /after March >1$ 1939$ or the date of enactment of :" -71C0
is entitled to his full bac%wages from the time his compensation was withheld from him /or the time he was illegally
dismissed0 up to the time of his actual reinstatement. &ull bac%wages means that there is no deduction of earnings
deri#ed elsewhere by the employee during the period of illegal dismissal. 7he bac%wages shall be computed from
the date of dismissal from ser#ice up to the date of finality of this decision.
Lopez is not entitled to moral and e(emplary damages because there was no showing that her dismissal was
effected in a wanton or oppressi#e manner.

.ED'A vs" C%S/D&01
.a2 2*, 1++3
'atur), Petition for certiorari of the resolution of the 9L:.
$acts,
7he petitioners are ran% and file employees of :adio Station BD,E at ;aguio ity which is operated by the
onsolidated ;roadcasting System /;S0$ a corporation engaged in the broadcast media industry.
!n "ugust 11$ 193F$ the "rea Manager issued notices of termination dated July >F$ 193F indi#idually to the
petitioners. 7he L" ruled that the petitioners were illegally dismissed and ordered ;S to reinstate them with full
bac%wages limited to three years. ;S was also found guilty of unfair labor practice /7he company interfered with$
restrained and coerced the petitioners in the e(ercise of their rights of self*organization.0 7he 9L: affirmed.
!n &ebruary 3$ 1992$ the petitioners filed a Motion for <ssuance of ,rit of 5(ecution$ because ;S did not reinstate
them to their pre#ious 8ob but instead offered them assignments in Ba#ao or ebu. <n #iew of this refusal to
reinstate$ the petitioners as% for additional bac%wages from receipt of the 9L: :esolution dated March >2$ 1939
until their actual reinstatement.
,hile the motion was being resol#ed$ ;S paid the bac%wages limited to three years.
7he L" issued a ,rit of 5(ecution ordering ;S to reinstate the petitioners but denied the petitioners. claim for
bac%wages under :" -71C. 7he 9L: dismissed the petitioners. appeal because "rt. >>1 of the Labor ode does
not apply since the case was decided by the L" on May 3$ 1933 or before the enactment of :" -71C.
Art. 223, as amended ! RA "#$%
In any event, the decision of the LA reinstating a dismissed or separated employee insofar as the reinstatement aspect is
concerned, shall immediately be executory, even pending appeal. The employee shall either be admitted back to work under the
same terms and conditions prevailing prior to his dismissal or separation or at the option of the employer, merely reinstated in the
payroll.
ssu), ,!9 the refusal to reinstate entitles the illegally dismissed employees to additional bac%wages pursuant to :"
-71C
H)l-, G5S$ but only from the time that :" -71C too% effect.
Ratio,
"rt. >>1 /as amended by :" -71C0$ cannot co#er the period before March >1$ 1939 during which petitioners
remained 8obless due to ;S.s failure to admit them bac% to wor%. 7his pro#ision may be applied but only from the
time :" -71C too% effect on March >1$ 1939.
)nder "rt. >>1 of the Labor ode$ the employer has two options in order for him to comply with an order of
reinstatement.
/10 7he employer can admit the dismissed employee bac% to wor% under the same terms and conditions pre#ailing
prior to his dismissal or separation or to a substantially e'ui#alent position if the former position is already filled
up.
/>0 7he employer can reinstate the employee merely in the payroll.
<f the company fails to e(ercise any of the options abo#e$ it can be compelled under pain of contempt to pay instead
the salary of the employee.
7he right of a person to his labor is deemed to be property within the meaning of the constitutional guaranty.
7herefore$ he should be protected against any arbitrary and un8ust depri#ation of his 8ob. 7he employee should not
be left without a remedy in case the employer unreasonably delays reinstatement.
7he un8ustified refusal of the employer to reinstate an illegally dismissed employee entitles the employee to the
payment of his salaries$ from the date the employer failed to reinstate despite an e(ecutory writ of e(ecution ser#ed
upon him. 7his is in accord with the mandate of "rt. >79 which awards full bac%wages until "7)"L reinstatement.
9!75@ 7he court also awarded additional bac%wages e'ui#alent to three years without 'ualification and deduction.
7his is due to the e#ident bad faith and obstinacy on the part of ;S to reinstate petitioners despite a final order of
reinstatement.
7hus$ two amounts of bac%wages are awarded@
/10 "ward of L"$ already recei#ed by the petitioners = intended to restore to some e(tent income of the employee
that was lost by reason of the illegal dismissal.
/>0 "ward of S = intended to indemnify the employee as a result of the un8ustified failure to reinstate.
7his is not in #iolation of the three*year limitation on bac%wages /Mercury Brug :ule0 because such rule admits of
certain e(ceptions. !ne such e(ception is when there is obstinacy or deceit in trying to defeat the 8udgment for
reinstatement and conse'uently prolonged non*satisfaction of the 8udgment$ as in this case.
7he case has not become moot and academic e#en if the parties agreed for the payment of separation pay instead
of reinstatement. &irst of all$ the agreement is not binding because it was made without the assistance of the L".
"lso$ the agreement operates as a 'uitclaim because it was entered into so that the petitioners would withdraw their
complaints.
Petition granted.
U'!' !$ SUPER#S!RS 3R%4 'ATU vs" SEC" !$ LA%!R
.arch 2+, 1+*4
'atur), Petition to re#iew the decision of the Secretary of Labor
$acts,
<n 197F$ a complaint for unfair labor practice was filed by 9orberto Luna against :epublic ;an%.
,hile the case was still pending$ there was a substantial change in the corporate structure of :epublic ;an%. 7o
sa#e the ban% from financial collapse$ an agreement was entered into between the old stoc%holders that the
Philippine Sugar ommission /PS0 will buy a substantial portion of the ban% to in8ect fresh capital.
"s a conse'uence of this reorganization$ the old :epublic ;an% became the :epublic Planters ;an%$ with new
controlling stoc%holders$ board membership and management. 7he ban% was also made the financing arm of the
PS.
!n 9o#ember 1>$ 1931$ the Supreme ourt rendered a decision finding that Luna was illegally dismissed by
:epublic ;an%. 7he court held that Luna is entitled to reinstatement to his former position as San Juan ;ranch
Manager$ without loss of seniority rights and other benefits and increases recognized by law or granted by the ban%
during the period of the illegal dismissal$ with bac%wages limited to three years. :epublic Planters ;an% only
learned of this case after it was furnished a copy of the decision. 7he old management did not ad#ise the present
management of the pendency of the case.
7hus$ the ban% filed a manifestation and motion to bring to the attention of the S these facts and circumstances
that occurred while the case was still pending. 7he ban% argues that it should not be made to suffer the
conse'uences of the unfair labor practices of the old management. 7he ban% also manifested reinstatement of Luna
to his old position would disturb the current organizational structure of the company.
;efore the court ruled on the motion$ the ban% paid Luna his bac%wages e'ui#alent to three years without
'ualification.
ssu), ,!9 Luna should be reinstated to his former position
H)l-, 9!$ he should be reinstated to a substantially e'ui#alent position.
Ratio,
:einstatement is a restoration to a state from which one has been remo#ed or separated. <t is the return to the
position from which he was remo#ed and assuming again the functions of the office already held.
:einstatement presupposes that the pre#ious position from which one had been remo#ed still e(ists$ or that there is
an unfilled position more or less of similar nature as the one pre#iously occupied by the employee.
Closur) o5 (usi6)ss 7 7here was no closure of business notwithstanding that the ban% was almost at a brin% of a
financial ruin. Bespite the widespread restructuring and reorganization$ the position pre#iously held by Luna was not
abolished$ but is now held by the incumbent manager who replaced him.
Section F$ :ule 1$ ;oo% A< of the <mplementing :ules states that@
An employee who is separated from work without !ust cause should be reinstated to his former position unless such position no
longer exists, at the time of his reinstatement, in which case he shall be given a substantially e"uivalent position in the same
establishment without loss of seniority rights.
5#en though his former position still e(ists$ Luna cannot be reinstated as San Juan ;ranch Manager because such
position relates to trust and confidence and therefore the incumbent manager who has already won the company.s
trust and confidence should not be dismissed in fa#or of Luna$ whose competence and integrity has not been tested.
7he fact that Luna had wor%ed for the ban% for >> years without any showing of irregularity in the performance of his
duties B!5S 9!7 pro#e that he has the trust and confidence of the ban%.
Eco6o8ic a6- %usi6)ss Co6-itio6s / 7he reinstatement remedy must always be adapted to economic*business
conditions. 7he ban% had to undergo inno#ations /such as the replacement of management$ hiring of new
managers0 to ensure reco#ery. 7o order the reinstatement of Luna to his former position would undermine the
ban%.s efforts at reco#ery
onsidering these conditions$ it is ine#itable that these be reflected in the desire for efficient and producti#e
management. 7his can only be effectuated if Luna is reinstated to a substantially e'ui#alent position and the
incumbent manager who is now holding Luna.s former position should be allowed to continue with his HtestedI
competence and integrity.
!th)r issu)s,
/10 <s Luna entitled to increases and benefits recognized by law or granted by the ban% during the period of his
dismissalJ
9!. Mere continuance as an employee does not 'ualify him for benefits and increases. ;enefits and increases are
allowed because of outstanding performance of duties and not solely because of the length of ser#ice.
/>0 an the ban% deduct the income deri#ed by Luna from other sources during his illegal dismissal from the amount of
bac%wages to be paidJ
Kenerally G5S. "n employer is entitled to deduct from what the ourt orders to be paid as bac%wages whate#er an
employee has earned elsewhere during the period for which bac%wages are supposed to be paid. Such 'ualification
is implied in all 8udgments ordering reinstatement$ unless otherwise e(pressly ordered by the ourt. /'!TE, 7his
ruling no longer applies after :" -71C was enacted on March >1$ 1939. See ;ustamante #s. 9L: case0
+owe#er$ the ban% can no longer ma%e deductions because it has already paid the full amount to Luna. 5'uity must
operate in fa#or of the employee e'ually as it fa#ors the employer.
D#'E 0!RD H9H SCH!!L vs" 'LRC
Au:ust ;, 1+*;
'atur), Petition to re#iew the decision of the 9L:.
$acts,
Luz atenza$ a high school teacher of Bi#ine ,ord ollege$ filed a complaint for illegal dismissal against her
employer. <n her complaint$ atenza alleged that she went on a #acation lea#e but when she tried to report bac% to
wor%$ she was informed that she is not anymore allowed to teach because of the HmisdeedsI and Himmoral actsI of
her husband Pablo$ who was then the principal of the same school
<n its answer to the complaint$ the school alleged that atenza was dismissed not because of the acts of her
husband$ but because of her own contemporaneous and subse'uent conduct of co#ering up and concealing the
immoral acts of her husband. atenza apparently threatened to %ill :emie <gnacio$ the #ictim of her husband.s
immoral acts.
7he Labor "rbiter held that there was illegal dismissal$ and ordered the reinstatement of atenza. 7he 9L:
modified this decision by gi#ing atenza a choice of whether she wanted to be reinstated with full bac%wages or be
separated from the ser#ice with termination pay. /9!75@ 7he 9L: considered the moral repercussions of
atenza.s act which it may ha#e towards the minds of the students of the Bi#ine ,ord$ which was a catholic
institution.0
ssu)s,
/10 ,!9 there was illegal dismissal
/>0 <f yes$ ,!9 her reinstatement is proper
H)l-,
/10 G5S
" re#iew of the records clearly shows that atenza was dismissed without #alid cause. 7he reason why she was
dismissed was because of the alleged immoral conduct of her husband. +owe#er$ her husband was ne#er
in#estigated nor was he e#er con#icted of the serious act alluded to him. atenza should not be made to suffer for
her husband.s indiscretion and infidelity.

/>0 9!
"lthough atenza was found to be illegally dismissed$ her reinstatement is not proper. +er continued presence in
the school may be met antipathy and antagonism by the atholic school community.
7hus$ Bi#ine ,ord is ordered to pay atenza separation pay e'ui#alent to one month pay for e#ery year of ser#ice$
plus her bac%wages /not to e(ceed three years0 from the time of the dismissal up to the time of actual payment.
'!TE, 7he issue of lac% of due process was also raised by the school$ because the L" had considered the case
submitted for decision despite the fact that the school had not yet rested its case. +owe#er$ a scrutiny of the records
show that the school was afforded e#ery opportunity to present its e#idence but no one appeared at the four consecuti#e
hearings scheduled for the purpose.
ESPE<! vs" 'LRC
.arch 2+, 1++;
'atur), Special i#il "ction in the Supreme ourt. ertiorari.
$acts,
!n "ugust 1$ 1937$ the ooperati#e <nsurance System of the Philippines /<SP0 hired 5spe8o as Keneral Manager
with a monthly salary of P9$222 plus some pri#ileges$ including the use of a company car with dri#er.
!n September 11$ 1939$ the ;oard of Birectors of <SP held a meeting to discuss the Hcease and desist orderI
issued by the <nsurance ommission against <SP on the grounds of Hcapital impairment and margin of sol#ency
deficiency.I <n order to meet the capital re'uirements$ the ;oard passed a resolution authorizing the sale of some
<SP properties$ including the car assigned to 5spe8o.
5spe8o ob8ected to the proposed sale. 7he ;oard did not act on his ob8ection so 5spe8o was prompted to tender his
irre#ocable resignation effecti#e !ctober 11$ 1939.
!n September >>$ 1939$ the ;oard held another meeting$ where they affirmed the sale of <SP properties. 7he
;oard also resol#ed to act on 5spe8o.s resignation.
!n September >-$ 1939$ the hairman of the company met with 5spe8o who manifested that he had changed his
mind about resigning and that he would continue as Keneral Manager despite the sale of the company car. 7he
hairman wrote a memo to the ;oard on !ctober 1 to inform the latter of 5spe8o.s oral re#ocation.
!n !ctober 9$ 1939$ 5spe8o recei#ed a letter from the hariman relaying the acceptance of his resignation effecti#e
!ctober 11. 5spe8o replied stating that he was surprised about this action of the ;oard$ since he had earlier
#erbally withdrawn his resignation. !n 9o#ember 1F$ 1939$ <SP paid 5spe8o his unpaid benefits.
5spe8o filed a complaint for illegal dismissal and damages. 7he L" ruled in his fa#or and ordered <SP to reinstate
him to his former position and to pay full bac%wages limited to three years. 7he 9L: affirmed the finding of illegal
dismissal but deleted the reinstatement for ha#ing become moot and academic since 5spe8o was already -2 years
old. 7he award of bac%wages was limited to 13 months.
ssu), ,!9 an illegally dismissed employee may be reinstated e#en if he had already reached retirement age
H)l-, 9!
Ratio,
<SP did not ha#e any retirement plan for its employees. 7hus$ Sec. 11 ;oo% <A of the !mnibus :ules shall apply.
7his rule pro#ides that in the absence of a retirement plan$ an employee may be retired upon reaching the age of -2
years. 7his pro#ision has been construed to mean that an employee may retire$ or may be retired by his employer$
upon reaching si(ty.
7hus$ 5spe8o cannot be reinstated anymore because he was already si(ty years old at the time the decision was
rendered.
Kenerally$ an illegally dismissed employee who cannot be reinstated is entitled to separation pay and bac%wages.
+owe#er$ considering that 5spe8o has already reached the statutory retirement age of si(ty$ he is only entitled to
bac%wages. +e is entitled to bac%wages because it is a form of relief that restores the income lost by reason of the
unlawful dismissal. +e is 9!7 entitled to separation pay because separation pay is oriented towards the immediate
future$ the transitional period the dismissed employee must undergo before locating a replacement 8ob.
+owe#er$ the amount of bac%wages should only co#er the time when 5spe8o was illegally dismissed up to the time
when he reached si(ty /from !ctober 11$ 1939 to January 11$ 19920.
Moral and e(emplary damages cannot be awarded because the decision to sell the company car was made by the
;oard$ and not the indi#idual whom 5spe8o considers to be his enemy. "lso$ the sale was made to meet certain
re'uirements of the <nsurance ommission.
<SP also relied on the term Hirre#ocableI in accepting the resignation and did not ta%e into account 5spe8o.s change
of heart. 7his misapprehension of 5spe8o.s intentions cannot be deemed bad faith on the part of <SP.
#udgment affirmed, but portion relating to period of backwages set aside. LA ordered to compute award of backwages.
4eneral Filling 5orp !s Torres, 1#7 "5RA 21; .#1/
.digest from boo/
2acts(
The $epartment of &abor issued an alien employment permit in fa!or of 'arl Timothy 5ode, a )" citi*en,
as sports consultant and assistant coach for 4F5.
&ater, Doard of "pecial 0n9uiry of the 5ommission on 0mmigration and $eportation appro!ed 5one=s
application for a change of admission status from temporary !isitor to pre-arranged employee.
A month later, 4F5 re9uested renewal for 5one=s permit and that it be allowed to employ 5one as a full-
fledged coach. $%&' Regional $irector granted re9uest.
Dasetball 5oaches Association of the +hilippines( 4F5 failed to show that there is no person in the
+hilippines who is competent and willing to do the ser!ices re9uired nor that the hiring of 5one would
redound to national interest.
0ssue( <%N permit re!ocation was !alid
Held( E'"
Ratio(
4F5=s right to choose is limited by statutory re9uirement of an employment permit
No impairment of right to contract since re9uirement of alien employment permit were in
e-istence long before 4F5 and 5one entered into their contract of employment
&abor $epartment, not 0mmigration 5ommission, is the agency !ested with 6urisdiction to
determine the 9uestion of a!ailability of worers.
,. $e!elopment of Human Resources
RA >>#7
a. Fanpower $e!elopment- Technical 'ducation and "ills $e!elopment of 2ilipino Fiddle-&e!el Fanpower
1. $efinition- "ection :.e/
Fiddle-&e!el Fanpower refers to those(
a. who ha!e ac9uired practical sills and nowledge through formal or non-formal education and training
e9ui!alent to at least a secondary education but preferably a post-secondary education with a
corresponding degree or diploma
b. silled worers who ha!e becomes highly competent in their trade or craft as attested by industry
2. +olicy- "ection 2
to pro!ide technical education and sills de!elopment in support of the de!elopment of high 9uality
2ilipino middle-le!el manpower responsi!e to and in accordance with +hilippine de!elopment goals and
priorities
rele!ant
accessible
high 9uality
efficient
The "tate shall encourage(
acti!e participation of !arious concerned sectors
particularly pri!ate enterprises
being direct participants in an immediate beneficiaries of a trained and silled worforce
in pro!iding technical education and sills de!elopment opportunities
,. 4oals and %b6ecti!es
"ection ,.
a. promote and strengthen the 9uality of technical education and sills de!elopment programs to attain
international competiti!eness
b. focus technical education and sills de!elopment on meeting the changing demands for 9uality middle-
le!el manpower
c. encourage critical and creati!e thining by disseminating the scientific and technical nowledge base of
middle-le!el manpower de!elopment programs
d. recogni*e and encourage the complementary roles of public and pri!ate institutions in technical
education and sills de!elopment and training systems
e. inculcate desirable !alues through the de!elopment of moral character with emphasis on wor ethic,
self-discipline, self reliance and nationalism
b. Training and 'mployment of "pecial <orers- Apprentices and &earners
1. +olicy %b6ecti!es
;>. "tatement of %b6ecti!es
1. to help meet the demand of the economy for trained manpower
2. establish a national apprenticeship program through the participation of employers, worers and
go!ernment and non-go!ernment agencies and
,. to establish apprenticeship standards for the protection of apprentices
2. $efinition
;8-As used in this Title .sections from RA >>#7/
a. apprenticeship- practical training on the 6ob supplemented by related theoretical instruction 5training
wit'in e2plo-2ent wit' co2pulsor- related t'eoretical instructions involving a contract $etween an
apprentice and an e2plo-er an esta$lis'ed period assured $- an apprenticea$le occupation6
b. apprentice- worer who is co!ered by a written apprenticeship agreement with an indi!idual employer
or any of the entities recogni*ed under this 5hapter 5person undergoing for an approved apprenticea$le
occupation during an esta$lis'ed period assured $- an apprentices'ip agree2ent6
c. apprenticeship occupation- any trade, form of employment or occupation which re9uires more than ,
months of practical training on the 6ob supplemented by related theoretical instruction 5an occupation
officiall- endorsed $- a tripartite $od- and approved for apprentices'ip $- t'e Aut'orit-6
f. apprenticeship agreement- employment contract wherein the employer binds himself to train the
apprentice and the apprentice in turn accepts the terms of the training 5a contract w'erein a prospective
e2plo-er $inds 'i2self to train t'e apprentice w'o in turn accepts t'e ter2s of training for a recogni8ed
apprenticea$le occupation e2p'asi8ing t'e rig'ts, duties and responsi$ilities of eac' part-6
>,. &earners defined- persons hired as trainees in semisilled and other industrial occupations which are
non-apprenticeable and which may be learned through practical training on the 6ob in a relati!ely sort
period of time which shall not e-ceed , months 5persons 'ired as trainees in se2i-s)illed and ot'er
industrial occupation w'ic' are non-apprenticea$le. Learners'ip progra2s 2ust $e approved $-
Aut'orit-6
,. Allowed 'mployment and <hen
73. 'mployment of apprentices
only employers in the highly technical industries
only in apprenticeable occupations appro!ed by the Finister of &abor and 'mployment
;8 c. apprentice occupation
>:. <hen learners may be hired.
when no e-perienced worer are a!ailable
to pre!ent curtailment of employment opportunities
employment does not create unfair competition in terms of labor costs or impair or lower woring
standards
:. 5onditions of 'mployment
71. 5ontents of apprenticeship agreements
conform to rules issued by Finister of &abor and 'mployment
shall not e-ceed 7 months
wage rates below legal minimum wage, which in no case shall start below >; percent of the
applicable minimum wage
Finister shall de!elop standard model programs of apprenticeship
>;. &earnership agreement-shall include(
a. names and addresses
b. duration which shall not e-ceed , months
c. wages or salary which shall begin at not less than >;K of the applicable minimum wage
d. a commitment to employ the learners if they so desire, as regular employees upon completion of
the &earnership. All learners who ha!e been allowed or suffered wor during the first 2 months
shall be deemed regular employees if training is terminated by the employer before the end of the
stipulated period through no fault of the learner.
shall be sub6ect to inspection by "ec of &abor or his rep
>7. &earners in piecewor.
%r incenti!e rate 6obs during the training period shall be paid in full for the wor done.
>2. Apprentices without compensation.
may be allowed by "ec
those whose training on the 6ob is re9uired by the school or training program curriculum pr as a
re9uisite for graduation or board e-amination
"ection >, RA >2>>. Apprenticeship
$isabled persons shall be eligible as apprentices or learners(
pro!ided that their handicap is not much as to effecti!ely impede the performance of 6ob
operations in the particular occupation for which they are hired
that after the lapse of the period of apprenticeship of found satisfactory in the 6ob, they shall be
eligible for employment
Boie-;a)eda C'e2icals, 1nc vs. de la Serna
!acts"
La$or and :evelop2ent 3fficer Ra2os, upon inspection, found out t'at Boie 'ad not $een including
co22issions earned $- its 2ed reps in t'e co2putation of t'eir 1+
t'
2ont' pa-.
Co2pan- said t'at t'ese were not part of t'e $asic salar-.
1ssue" W3N ite2s of e2plo-ee re2uneration s'ould go into t'e co2putation of 1+
t'
2ont' pa-
*eld" N3
Ratio"
1. not part of $asic salar-" w'at e2plo-ee receives for a standard wor) period
2. co22issions are for e?tra efforts e?erted in consu22ating sales or ot'er related transactions
d. 4ratuity and "alaryA<ages, $ifference
Plastic To=6 c)6t)r Corp vs 'LRC, 1>2 SCRA 5*?
#etitioner alleges t'at on @a- 1, 1./, it granted a 1.&& increase pursuant to Wage 3rder No. , w'ic' is
in consonance wit' section + of t'e CBA was to $e credited to t'e ,ul- 1, 1./ increase under t'e CBA. 1t
was, t'erefore, a ,ul- increase.
Section +, 'owever, clearl- states t'at CBA granted increases s'all $e credited against future allowances
or wage orders. ;'us, t'e CBA increase to $e effected on ,ul- 1, 1./ cannot $e retroactivel- applied to
2ean co2pliance wit' W3 , w'ic' too) effect on @a- 1, 1./.
1ssue" W3N under t'e principle of fair da-(s wage for fair da-(s la$or, gratuit- pa- s'ould $e co2puted on
t'e $asis of 20 da-s for 1 2ont' salar- since e2plo-ees are dail- paid
*eld" N3
Ratio"
1. gratuit- is so2et'ing given freel-, or wit'out reco2pense
2. not intended to pa- a wor)er for actual services rendered
+. to reward e2plo-ees w'o 'ave rendered satisfactor- and efficient service to co2pan-
e. effect on $enefits
Davao $ruits Corp vs Associat)- La(or U6io6
!acts"
#a-2ent of 1+
t'
2ont' pa- differentials
1ssue" W3N in t'e co2putation of 1+
t'
2ont' pa- given, pa-2ents for sic), vacation, and 2aternit- leave
2a- $e e?cluded in t'e co2putation t'ereof, regardless of long-standing co2pan- practice
*eld" Ces
Ratio"
Basic salar- 9ICL<:9S"
1. cost of living allowance
2. profit-s'aring pa-2ents
+. all allowances and 2onetar- $enefits w'ic' 'ave not $een considered as part of t'e $asic salar-
5supple2entar- rules and regulations i2planting #: /%16
D. <age 2i-ing Fachinery
1. Rationale for <age Rationali*ation
to promote producti!ity-impro!ement and gain-sharing measures to ensure a decent standard of
li!ing
to guarantee the rights of labor to its 6uts share in the fruits of production
to enhance employment generation in the countryside through industry dispersal
to allow business and industry reasonable returns on in!estment, e-pansion and growth
The "tate shall(
promote collecti!e bargaining as the primary mode of settling wages and other terms and
conditions of employment
minimum wage rates shall be ad6usted in fair and e9uitable manner
considering regional disparities in the cost of li!ing and other socio-econ factors and the
national economic and social de!elopment plans
,. Agencies in <age 2i-ing Fachinery
a. National <ages and +roducti!ity 5ommission
"ec ,. 123 5reation of- attached to $%&' for policy and program coordination
121. +owers and 2unctions of the 5ommission
a. national consultati!e and ad!isory body on matters relating to wages, incomes and producti!ity
b. formulate policies ad guidelines
c. prescribe rules and guidelines for the determination of appropriate minimum wage and
producti!ity measures at all le!els
d. re!iew regional wage le!els
e. undertae studies, researches, sur!eys( collect and compile data, disseminate info
f. re!iew plans and programs of RT<+D
g. e-ercise technical and administrati!e super!ision o!er RT<+D
h. call national tripartite conference of reps of go!t, worers and employers for the consideration of
measures to promote wage rationali*ation and producti!ity
i. e-ercise such powers and functions as may be necessary
127. +rohibition against in6unction
b. Regional Tripartite <ages and +roducti!ity Doard
"ec ,. 122. 5reation of RT<+C
1. de!elop plans, programs and pro6ects relati!e to wages, incomes and producti!ity impro!ement
for their regions
2. determine and fi- minimum wage
,. undertae studies, researches, and sur!eys
:. coordinate with other boards to attain policy and intention
;. recei!e, process and act on application for e-emption from prescribed wage rates
7. e-ercise such other powers and functions as may be necessary to carry out their mandate
Nasipit Lu2$er Co. vs NLRC, 2/. SCRA 007
!acts"
Nasipit applied for e?e2ption fro2 Wage 3rders issued $- Region 1& Board due to"
1. depressed econo2ic activities due to worldwide recession
2. peace and order and ot'er related pro$le2s causing disruption and suspension of nor2al logging
operations
+. i2position of environ2ental fee for ti2$er production in addition to regular forest c'arges
. logging 2oratoriu2 in Bu)idnon
%. etc
<nions clai2ed t'at co2pan- was not distressed since capitali8ation 'as not $een i2paired $- 2%J
1ssue" W3N guidelines $- an R;W#B wit'out approval of NW#C is valid
*eld" N3
Ratio"
1. RA 0727 a2ended LC and grants NW#C power to prescri$e rules and guidelines for deter2ination
of 2ini2u2 wage and productivit- 2easures
2. R;W#B 'as power to issue wage orders $ut su$4ect to rules on @ini2u2 Wage !i?ing
+. NW#C never assented to Auideline No. +
. 1nsertion of Auideline of Kdistressed industr-( as criterion for e?e2ption is void" irregularl- ta)es
awa- 2andated increase in 2ini2u2 wage awarded to wor)ers
ALC3 application approved" sustained capital i2pair2ent of 2/.72J
,. "tandardsA5riteria for Finimum <age 2i-ing
"ec ,. 12:. regional minimum wages
established by regional Doard
as nearly ade9uate as is economically feasible to maintain the minimum standards of li!ing
necessary for health, efficiency and general well-being of employees
within the framewor of national economic and social de!elopment program
factors to be considered(
a. demand for li!ing wages
b. wage ad6ustment !is-]-!is consumer price inde-
c. cost of li!ing and changes or increases therein
d. needs of worers and their families
e. need to induce industries to in!est in the countryside
f. impro!ement in standards of li!ing
g. pre!ailing wage le!els
h. fair return of the capital in!ested and capacity to pay of employers
i. effects on employment generation and family income
6. e9uitable distribution of income and wealth along the imperati!es of economic and social
de!elopment
;. <age order
12,. wage %rder
shall tae effect after 1; days from its complete publication in at least 1 newspaper of general
circulation in the region
Doard shall conduct public hearingsAconsultations, gi!ing notices
Aggrie!ed party may appeal <% to commission within 13 calendar days from publication
decide within 73 days
The filing of the appeal does not stay order unless the person appealing shall file with commission an
undertaing with a surety or sureties satisfactory to the commission for the payment to the employees
affected by the order of the corresponding increase, in the e!ent such order is affirmed.
c. <age $istortion, 12:
employer and union shall negotiate to correct distortions
use grie!ance procedure under 5DA
if not resol!ed, !oluntary arbitrator or panel of !oluntary arbitrators within 13 calendar days from
the time said dispute was referred to !oluntary arbitration
N% 5DA(
then settled through National 5onciliation and Fediation Doard
if unsol!ed after 13 calendar days( referred to appropriate branch of N&R5
mandatory for N&R5 to conduct continuous hearings and decide dispute within 23 calendar days
from time said dispute is submitted for compulsory arbitration
The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of
any increase in prescribed wage rates pursuant to the pro!isions of law or <%.
<age distortion( a situation where an increase in prescribed wage rates results in the elimination or
se!ere contraction of intentional 9uantitati!e difference in wage or salary rates between and among
employee groups in an establishment as to effecti!ely obliterate the distinctions embodied in such wage
structure based on sills, length of ser!ice or other logical bases of differentiation.
#ru$an)ers Association vs #rudential Ban) and ;rust Co
!acts"
#etitioner granted a C3LA of 17.%& to its Naga $ranc' e2plo-ees pursuant to Wage 3rder RB &%-&+.
1t also integrated 1%& per 2ont' C3LA into t'e $asic pa- of its ran)-and-file e2plo-ees at its Ce$u,
@a$olo, and #. del Rosario $ranc'es.
1ssue" W3N t'ere was wage distortion
*eld" N3
Ratio"
1. =uantitative difference in co2pensation $etween different pa- classes re2ained t'e sa2e in all
$ranc'es in t'e affected region
2. :isparit- in wages $etween e2plo-ees 'olding si2ilar positions $ut in different regions does not
constitute wage distortion $ut is e?pected $- t'e law
+. Wage distortion arises w'en a wage order engenders wage parit- $etween e2plo-ees in different
rungs of t'e organi8ational ladder of sa2e esta$lis'2ent
Wage distortion involves four ele2ents"
1. an e?isting 'ierarc'- of positions wit' corresponding salaries
2. a significant c'ange in t'e salar- rate of a lower pa- class wit'out a conco2itant increase in t'e
salar- rate of a 'ig'er one
+. eli2ination of t'e distinction $etween t'e 2 levels
. e?istence of t'e distortion in t'e sa2e region of t'e countr-
esta$lis'2ent 5NW#C Auideline No 1
an econo2ic unit w'ic' engages in one or predo2inantl- one )ind of econo2ic activit- wit' a
single fi?ed location
C" 0a:) Pa28)6t a6- Prot)ctio6
1. 2orm of +ayment
132. not allowed(
promissory notes
!ouchers
coupons
toens
ticets
chits
or any ob6ect other than legal tender,
e!en when e-pressly re9uested by employee
+ayment of wages by chec or money order shall be allowed when such manner of payment is customary
on the date of the effecti!ity of this 5ode, or is necessary because of special circumstances as specified in
appropriate regulations to be issued by "ec of &abor or as stipulated in a 5DA.
1>3;, 55. The laborer@s wages shall be paid in legal currency.
%mnibus Rules, Doo ,, Rule 8
"ection 1. Fanner of wage payment ( same as &5
"ection 2. +ayment by ban checs, postal checs or money orders
customary on date of effecti!ity
where it is stipulated in a collecti!e agreement or
where all the ff conditions are met(
a. there is a ban or other facility for encashment within a radius of 1 ilometer from
worplace
b. employer, or any of his agents or reps, does not recei!e any pecuniary benefit directly or
indirectly from the arrangement
c. employees are gi!en reasonable time during baning hours to withdraw their wages from
the ban which time shall be considered as compensable hours wored if done during
woring hours
d. payment by chec is with the written consent of employees concerned when there is no
collecti!e agreement authori*ing the payment of wages by ban checs.
2. Time of +ayment
13,.
at least once e!ery 2 wees or twice a month at inter!als not e-ceeding 17 days
e-ception( force ma6eure or circumstances beyond employer=s control
no employer shall mae payment with less fre9uency than once a month
+ayment of wages of employees engaged to perform a tas which cannot be completed in 2 wees shall
be sub6ect to ff conditions, in the absence of 5DA or arbitration award(
1. payments are made at inter!als not e-ceeding 17 days, in proportion to amount of wor
completed
2. that final settlement is made upon completion of wor
"ec ,( same as &5
,. +lace of payment, 13:
at or near the place of undertaing
e-ception( pro!ided by "ec under conditions to ensure greater protection of wages
."ec > of RA 7>2;( through bans with permission of ma6ority AN$ &abor Ad!isory on +ayment of
salaries thru ATF/
"ec :( other places when(
1. by reason of deterioration of peace and orders conditions, or by reason of impending emergencies
caused by fire, flood, epidemic or other calamity rendering payment thereat impossible
2. employer pro!ides free transportation to employees bac and forth
,. under any other analogous circumstances1 pro!ided it be compensable
Not allowed( payment in(
bar
night or day club
drining establishment
massage clinic
dance hall
other similar places where games are played with staes of money or things representing money
or things representing e-cept in the case of persons employed in said places
:. $irect +ayment of wages
13;. $irect payment of wages
'-ception(
a. cases of force ma6eure or other special circumstances
may be paid thru another person under written authority gi!en by worer
b. worer has died
to heirs without need of intestate proceedings
claimants of age shall e-ecute an affida!it attesting to their relationship to the deceased and the
fact that they are his heirs, to the e-clusion of all other persons
affida!it presented it the employer who shall mae payment through "ec of &abor or his reps
rep shall act as referee in di!iding amount
payment here shall absol!e the employer of any further liability with respect to amount paid.
"ec ;. '-cept
1. employer is authori*ed in writing by employee to pay his wages to a member of his family
2. when authori*ed by law, including payment of insurance premiums and union dues hWwhere the
right to chec-off has been recogni*ed by the employer in accordance with a collecti!e agreement
or authori*ed in writing by the employees
,. in case of death..same as &5
Faraguinot !s N&R5
2acts(
Faraguinot as member of filming crew.
'nero as shooting crew.
Tass(
1. loading and unloading mo!ie e9uipment
2. arranging them
,. retuning them to C0CA warehouse
:. assist in the fi-ing of lighting system
;. other tas that maybe assigned
"ometime in Fay 1##2, they re9uested for an ad6ustment in salary according to minimum wage law and
they were informed that Cic del Rosario would agree to increase salary if they would sign blan
employment contract. <hen they refused to do so, their ser!ices were terminated.
Ci!a=s defense(
1. only engaged in the bi* of distribution and e-hibition of mo!ies
2. complainants were thus pro6ect employees of producers
0ssue( <on they were pro6ect employees
Held( Ees
Ratio(
1. Ci!a admitted they worers were part of worpool
2. regulari*ed( 'nero employed for 2 years in 18 pro6ects while Faraguinot for , years in 2, pro6ects
,. +0 also applies to other industries co* there is no substantial distinction between pro6ects
undertaen in the construction industry and the film industry
:. Doth industries concern pro6ects with a foreseeable suspension of wor