Labor Standards

ChanRobles Internet Bar Review : ChanRobles Professional Review, Inc.
LAST-MINUTE
NOTES ON THE 2012 BAR EXAMINATION IN LABOR LAW BASED ON THE
SUPREME COURT-PRESCRIBED SYLLABUS
Prof. Joselito Guianan Chan
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C. LABOR STANDARDS
[These 8-part Notes discuss all topics/sub-topics in the Supreme Court-prescribed Syllabus for Labor Law]
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TOPICS UNDER THE SYLLABUS
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1. Hours of Work
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C. LABOR STANDARDS
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a. Service Incentive Leave Pay

(1) Right to service incentive leave
(2) Exclusions from coverage
(3) Commutable nature of benefit
b. Maternity Leave
(1) Coverage
(2) Conditions to entitlement
(3) Availment
c. Paternity Leave
(1) Coverage
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a. Right to holiday pay

(1) In case of absences
(2) In case of temporary cessation of work
(3) Of teachers, piece workers, seafarers, seasonal workers, etc.
b. Exclusions from coverage
5. Leaves
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a. Right to weekly rest day

b. Preference of the employee
c. When work on rest day authorized
4. Holidays
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3. Rest Day
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a. No work no pay principle

b. Coverage/Exclusions
c. Facilities vs supplements
d. Wages vs. salaries
e. Wage distortion
f. CBA vis--vis Wage Orders CBA creditability
g. Non-diminution of benefits
h. Workers preference in case of bankruptcy
i. Labor Code provisions for wage protection
j. Allowable deductions without employees consent
k. Attorneys fees and union service fee in labor cases
l. Criteria/Factors for Wage Setting
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2. Wages
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a. Coverage/Exclusions
b. Normal Hours of Work
(a) Exceptions
(a) Health Personnel
c. Compressed Work Week
d. Work interruption due to brownouts
e. Meal Break
f. Idle time, waiting time, commuting time, travel time, whether part of hours of work or not
g. Overtime work
(a) Undertime not offset by overtime
(b) Waiver of overtime pay
h. Night Work
i. CBA provision vis--vis overtime work
LABOR LAW: C. LABOR STANDARDS

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a. Definition
b. Benefits accorded househelpers
c. Termination
d. Reliefs for unjust termination
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11. Employment of Homeworkers
12. Apprentices and Learners
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a. Definition
b. Rights and benefits accorded homeworkers
c. Conditions for deduction from homeworkers earnings
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13. Handicapped Workers (RA 7277)
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a. Distinctions between Learnership and Apprenticeship
a. Definition of handicapped workers

b. Rights of disabled workers
c. Prohibitions on discrimination against disabled persons
d. Incentives for employers
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==========================================
TOPIC UNDER THE SYLLABUS
C. LABOR STANDARDS
1. Hours of Work
a. Coverage/Exclusions
b. Normal Hours of Work
(a) Exceptions
(a) Health Personnel
c. Compressed Work Week
d. Work interruption due to brownouts
e. Meal Break
f. Idle time, waiting time, commuting time,
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10. Employment of Househelpers
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a. Regulation of working hours of a child

b. Employment of the child in public entertainment
c. Prohibition of employing minors in certain undertakings and in certain advertisements
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9. Minor Workers (RA 7678, RA 9231)
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a. Discrimination (Art. 135, LC)

b. Stipulation against marriage (Art. 136, LC)
c. Prohibited Acts (Art. 137, LC)
d. Classification of certain women workers (Art. 138, LC)
e. Anti-Sexual Harassment Act (RA 7877)
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8. Women Workers
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a. Coverage
b. Exclusion/Exemptions from coverage
c. Nature of 13th month pay
d. Commissions vis--vis 13th month pay
e. CBA vis--vis 13th month pay
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7. Thirteenth (13th) Month Pay and other bonuses
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a. Coverage
b. Exclusion
c. Distribution
d. Integration
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6. Service Charges
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(3) Availment
d. Parental Leave
(1) Coverage
(3) Availment
e. Leaves for victims of violence against women
(1) Coverage
(3) Availment
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travel time, whether part of hours of work or not

g. Overtime work
(a) Undertime not offset by overtime
(b) Waiver of overtime pay
h. Night Work
i. CBA provision vis--vis overtime work
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1.PROVISIONSOFTHELABORCODEONWORKINGCONDITIONS.
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2.COVERAGE.
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TheprovisionsonworkingconditionsintheLaborCodeareasfollows.
Article83
Normalhoursofwork;
Article84
Hoursworked;
Article85
Mealperiods;
Article86
Nightshiftdifferential;
Article87
Overtimework;
Article88
Undertimenotoffsetbyovertime;
Article89
Emergencyovertimework;
Article90
Computationofadditionalcompensation;
Righttoweeklyrestperiod;
Article91
Article92
Whenemployermayrequireworkonarestday;
Article93
Compensationforrestday,Sundayorholidaywork;
Article94
Righttoholidaypay;
Article95
Righttoserviceincentiveleave;and
Servicecharges.
Article96
3.EXCLUSIONS.
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4.NORMALHOURSOFWORK.
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Thetotalnumberofworkinghoursofaworkeroremployeeshallnotexceedeight(8)hoursdaily.Thiseight(8)
hourperiodiscalledthenormalhoursofwork.Anyworkinexcessofeight(8)hoursisconsideredovertimework.
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4.1.EXCEPTIONS:
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a.Reductionof8hourworkingdaybyemployer.
Theemployer,inthelawfulexerciseofitsprerogative,isnotprohibitedfromreducingtheeighthournormal
workingtimeperdayprovidedthatnocorrespondingreductionismadeontheemployeeswageorsalaryequivalentto
aneighthourworkday.Ininstanceswherethenumberofhoursrequiredbythenatureofworkislessthaneighthours,
suchnumberofhoursshouldberegardedastheemployeesfullworkingday.
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b.Brokenhours.
Thenormaleight(8)workinghoursmandatedbylawdonotalwaysmeancontinuousanduninterruptedeight
(8)hoursofwork.Asmayberequiredbypeculiarcircumstancesofemployment,itmaymeanbrokenhoursofsay,four
hours in the morning and four hours in the evening or a variation thereof, provided the total of eight (8) hours is
accomplished within one work day as this term is understood in law [infra]. Hence, the 4hour work done in the
eveningasintheexampleabove,shouldnotbeconsideredovertimeworksincetheeighthourperiodhasnotyetbeen
exceeded.
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Thefollowingareexcludedfromthecoverageofthelawonlaborstandards:
a. Governmentemployees;
b.Managerialemployees;
c.Otherofficersormembersofamanagerialstaff;
d.Domesticservantsandpersonsinthepersonalserviceofanother;
e.Workerspaidbyresults;
f.Nonagriculturalfieldpersonnel;and
g.Membersofthefamilyoftheemployer.
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c.Staggeredworkingtime.
Staggeredworkingtimeisavalidschemewhichmayberesortedtobyemployers.Asamatterofprecedence,
MemorandumCircularNo.81wasissuedbytheOfficeofthePresidentonDecember14,2004whichimplementedthe
StaggeredWorkingTimeintheExecutiveDepartmentinrelationtotheotherbranchesofgovernmentandtheprivate
sector in Metro Manila during the Christmas Season from December 15, 2004 to January 6, 2005. According to this
issuance,theStaggeredWorkingTimeismeanttoimprovethedeliveryofgoodsandservices.
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Allemployeesinallestablishments,whetheroperatedforprofitornot,arecoveredbythelawonlabor
standards.
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d.Workindifferentshifts.
Inestablishmentswhereworkisindifferentshifts,workdonebytheemployeebeyondhiseighthourshiftis
consideredovertimeworkwhichshouldbecompensatedaccordingly.Forexample,iftherearethree(3)eighthour
shiftsinaworkday,say,thefirstshiftisfrom6:00a.m.to2:00p.m.;secondshiftfrom2:00p.m.to10:00p.m.;andthe
thirdshiftfrom10:00p.m.to6:00a.m.ofthefollowingday,theemployeewhoseregulareighthourworkisinthefirst
shift (6:00 a.m. to 2:00 p.m.), once required to work in the second or third shift, should be given additional
compensationforsuchworkdonebeyondhisregularworkinghourswhichlegallyisconsideredovertimework.
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e.Reductionofworkdaysonaccountoflosses.
Workdaysmaybereducedinsituationswherethereductioninthenumberofregularworkingdaysisresorted
tobytheemployertopreventseriouslossesduetocausesbeyondhiscontrol,suchaswhenthereisasubstantialslump
inthedemandforhisgoodsorservicesorwhenthereislackofrawmaterials.1
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h.Parttimework.
TherulesimplementingthedifferentWageOrdersissuedbytheRegionalTripartiteWagesandProductivity
Boards(RTWPBs)inthevariousregionsinthecountrycarryauniformprovisiontotheeffectthatwagesandallowances
ofparttimeworkersshallnotbelessthanthecompensabletimethattheyactuallyrenderedwork.Hence,inthecaseof
costoflivingallowance(COLA),iftheworkerrenderedworkforlessthantheprescribedeight(8)hours,sayforfour(4)
hoursonly,theemployermayvalidlymakeproportionatepaymentofCOLA,ifithasgrantedaproportionatepaymentin
theworkersbasicwage.Followingtheprincipleofnowork,nopay,noallowance,theworkersarenotentitledtosaid
benefitsforthefourhourperiodthattheydidnotrenderwork.Itisimportanttostress,however,thattheemployees
shouldhaveenteredintoanagreementwiththeemployerthattheywillbeemployedasparttimeworkers.
Inviewoftheforegoing,ontheissueofwhetherthecompanyshouldgivetheparttimeemployeesconcerned
onlyfiftypercent(50%)ofthewagesandotherbenefitsthattheemployermaypaytheworkerswhowillworkforfour
(4)hoursaday,6:00to10:00intheevening,itwasopinedintheAdvisoryOpiniononConditionsofEmploymentofPart
time Workers issued by the Bureau of Working Conditions of the Department of Labor and Employment, that
compensationinproportiontothetimetheyactuallyrenderedworkorequivalenttoonlyfour(4)hoursadaymustbe
giventoparttimeworkers.Thisis,however,withoutprejudicetoanyindividualorcollectiveagreementorcompany
practiceorpolicythatprovideshigherbasisofcomputationofwages.
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g.Flexibleworkarrangementsduringeconomicdifficultiesandnationalemergencies.
DOLE Secretary Marianito D. Roque issued Department Advisory No. 2, Series of 2009, on January 29, 2009
enunciatingtheGuidelinesontheAdoptionofFlexibleWorkArrangements.
Thefollowingaretheflexibleworkarrangementswhichmaybeconsidered,amongothers:
1. CompressedWorkweekreferstoonewherethenormalworkweekisreducedtolessthansix(6)daysbut
thetotalnumberofworkhoursof48hoursperweekshallremain.Thenormalworkdayisincreasedto
morethan eighthoursbutnotto exceedtwelvehours,withoutcorrespondingovertime premium. The
conceptcanbeadjustedaccordinglydependingonthenormalworkweekofthecompanypursuanttothe
provisionsofDepartmentAdvisoryNo.02,Seriesof2004,datedDecember2,2004.
2. ReductionofWorkdaysreferstoonewherethenormalworkdaysperweekarereducedbutshouldnot
lastformorethansix(6)months.
3. RotationofWorkersreferstoonewheretheemployeesarerotatedoralternatelyprovidedworkwithin
theworkweek.
4. ForcedLeavereferstoonewheretheemployeesarerequirestogoonleaveforseveraldaysorweeks
utilizingtheirleavecredits,ifthereareany.
5. Brokentime schedule refers to one where the work schedule is not continuous but the workhours
withinthedayorweekremain.
6. Flexiholidaysschedulereferstoonewheretheemployeesagreetoavailoftheholidaysatsomeother
daysprovidedthereisnodiminutionofexistingbenefitsasaresultofsucharrangement.
Under these flexible work arrangements, the employers and the employees are encouraged to explore
alternativeschemesunderanyagreementandcompanypolicyorpracticeinordertocushionandmitigatetheeffectof
thelossofincomeoftheemployees.
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f.FlexibleworkscheduleunderR.A.No.8972.
UnderRepublicActNo.8972,otherwiseknownasTheSoloParentsWelfareActof2000,soloparentsare
allowedtoworkonaflexibleschedule,thus:
Sec.6.FlexibleWorkSchedule.Theemployershallprovideforaflexibleworkingschedule
for solo parents: Provided, That the same shall not affect individual and company productivity:
Provided,further,Thatanyemployermayrequestexemptionfromtheaboverequirementsfromthe
DOLEoncertainmeritoriousgrounds.(Section6,RepublicActNo.8972).
Thephraseflexibleworkscheduleisdefinedinthesamelawastherightgrantedtoasoloparentemployee
tovaryhis/herarrivalanddeparturetimewithoutaffectingthecoreworkhoursasdefinedbytheemployer.2
Explanatory Bulletin on the Effect of Reduction of Workdays on Wages/Living Allowances issued by the DOLE on July 23, 1985.
See Section 3[e] thereof
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4.2.HOURSOFWORKOFHOSPITALANDCLINICPERSONNEL.
a.Coverage.
ThesecondparagraphofArticle83oftheLaborCodeenunciatestheruleonhoursofworkofhospitaland
clinicpersonnel.ItsprovisionaswellasthecorrespondingprovisionsintheRulestoImplementtheLaborCode,applyto:
a.All hospitals and clinics, including those with a bed capacity of less than one hundred (100) which are
situatedincitiesormunicipalitieswithapopulationofone(1)millionormore;and
b.Allhospitalsandclinicswithabedcapacityofatleastonehundred(100),irrespectiveofthesizeofthe
populationofthecityormunicipalitywheretheymaybesituated.3
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b.Definitionofterms.
Thetermshospitalandclinicshallmeanaplacedevotedprimarilytothemaintenanceandoperationof
facilitiesforthediagnosis,treatmentandcareofindividualssufferingfromillness,disease,injuryordeformity,orinneed
ofobstetricalorothermedicalandnursingcare.Eithertermshallalsobeconstruedasanyinstitution,building,orplace
wherethereareinstalledbedsorcribsorbassinetsfortwentyfour(24)houruseorlongerbypatientsinthetreatment
ofdiseases,injuries,deformitiesorabnormalphysicalandmentalstates,maternitycasesorsanitarialcareorinfirmaries,
nurseries,dispensariesandsuchothersimilarnamesbywhichtheymaybedesignated.(Section2,RuleIA,BookIII,
RulestoImplementtheLaborCode).
The term health personnel shall include resident physicians, nurses, nutritionists, dieticians, pharmacists,
social workers, laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other
hospitalorclinicpersonnel.4
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f.Hoursworkedofhospitalorclinicpersonnel.
Indeterminingthecompensablehoursofworkofhospitalandclinicpersonnel,thepertinentprovisionsofRule
1ofBookIIIoftheRulestoImplementtheLaborCodeshallapply.8
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POLICYINSTRUCTIONSNO.54.
a.Workinghoursandcompensationofhospital/clinicpersonnel.
PolicyInstructionsNo.54[April12,1988]providesthatpersonnelinsubjecthospitalsandclinicsareentitledto
afullweeklywageforseven(7)daysiftheyhavecompletedthe40hour/5dayworkweekinanygivenworkweek.
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b.PolicyInstructionsNo.54,declaredvoid.
TheSupremeCourt,however,hasvoidedPolicyInstructionsNo.54inthecaseofSanJuandeDiosHospital
Employees Association v. NLRC, [G.R. No. 126383, November 28, 1997]. Consequently, the rule that hospital
employeeswhoworkedforonly40hours/5daysinanygivenworkweekshouldbecompensatedforfullweeklywagefor
seven(7)daysisnolongerapplicable.
TheSupremeCourtratiocinatedthattheSecretaryofLaborexceededhisauthoritybyincludingatwodaysoff
withpayincontraventionoftheclearmandateofthestatute.SuchacttheCourtshallnotcountenance.Administrative
interpretationofthelaw,wereiterate,isatbestmerelyadvisory,andtheCourtwillnothesitatetostrikedownan
administrativeinterpretationthatdeviatesfromtheprovisionofthestatute.
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e.Overtimeworkofhospitalorclinicpersonnel.
Where the exigencies of the service so require as determined by the employee, any employee may be
scheduledtoworkformorethanfive(5)daysorforty(40)hoursaweekprovidedthattheemployeeispaidforthe
overtime work an additional compensation equivalent to his regular wage plus at least thirty percent (30%) thereof,
subjecttotheprovisionsofBookIIIoftheLaborCodeonthepaymentofadditionalcompensationforworkperformed
onspecialandregularholidaysandonrestdays.7
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d.Regularworkingdaysofhospitalorclinicpersonnel.
The regular working days of covered employees shall not be more than five (5) days in a workweek. The
workweekmaybeginatanyhourandonanyday,includingSaturdayorSunday,designatedbytheemployer.Employers
arenotprecludedfromchangingthetimeatwhichtheworkdayorworkweekbeginsprovidedthatthechangeisnot
intendedtoevadetherequirementsofRuleIAoftheRulestoImplementtheLaborCode.6
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c.Regularworkinghoursofhospitalorclinicpersonnel.
Theregularworkinghoursofhospitalandclinicpersonnelshallnotbemorethaneight(8)hoursinanyoneday
normorethanforty(40)hoursinanyoneweek.Adayshallmeanaworkdayoftwentyfour(24)consecutivehours
beginningatthesametimeeachcalendarday.Aweekshallmeantheworkweekof168consecutivehours,orseven
consecutive24hourworkdays,beginningatthesamehourandonthesamecalendardayeachcalendarweek.5
Article 83, Labor Code; Section 1, Rule I-A, Book III, Rules to Implement the Labor Code.
Article 83, Labor Code; Section 4, Rule I-A, Book III, Ibid..
Section 5, Rule I-A, Book III, Ibid..
6 Section 6, Rule I-A, Book III thereof.
7 Article 83, Labor Code; Section 7, Rule I-A, Book III, Ibid..
8 Section 8, Rule I-A, Book III, Ibid..
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5.COMPRESSEDWORKWEEK(CWW).
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LintonCommercialCo.,Inc.v.Hellera,[G.R.No.163147,October10,2007].
Indeclaringthecompressedworkweekarrangementinthiscaseasunjustifiedandillegalandinholdingthat
petitionersareguiltyofillegalreductionofworkhours,theSupremeCourtfoundspeciousthepetitionersattemptto
justifytheiractionbyallegingthatthecompanywassufferingfromfinanciallossesowingtotheAsiancurrencycrisis.
Petitionersclaimoffinanciallosseswasnotsupportedbyevidence.Acloseexaminationofpetitionersfinancialreports
for19971998showsthatwhilethecompanysufferedalossofP3,645,422.00in1997,itretainedaconsiderableamount
ofearningsandoperatingincome.Clearlythen,whileLintonsufferedfromlossesforthatyear,thereremainedenough
earningstosufficientlysustainitsoperations.Inbusiness,sustainedoperationsintheblackistheidealbutbeinginthe
red is a cruel reality. However, a year of financial losses would not warrant the immolation of the welfare of the
employeeswhichinthiscasewasdonethroughareducedworkweekthatresultedinanunsettlingdiminutionofthe
periodicpayforaprotractedperiod.Permittingreductionofworkandpayattheslightestindicationoflosseswouldbe
contrarytotheStatespolicytoaffordprotectiontolaborandprovidefullemployment.
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b.DepartmentOrderNo.02,Seriesof2004.
DepartmentOrderNo.02,Seriesof2004,wasissuedbytheSecretaryofLaborandEmploymentonDecember
2, 2004 implementing compressed workweek schemes to guide employers and workers who may opt to adopt a
mutuallyacceptablecompressedworkweek(CWW)schemesuitabletotherequirementsoftheestablishment
As a matter of policy, and taking into account the emergence of new technology and the continuing
restructuring and modernization of the work process, the Department of Labor and Employment (DOLE) encourages
employersandworkerstoenterintovoluntaryagreementsadoptingCWWschemesbasedonthefollowingobjectives:
1. Topromotebusinesscompetitivenessandproductivity,improveefficiencybyloweroperatingcosts,and
reduceworkrelatedexpensesofemployees;
2. Togiveemployersandworkersflexibilityinfixinghoursofworkcompatiblewithbusinessrequirements
andtheemployeesneedforabalancedworklife;and
3. Toensurethesafetyandhealthofemployeesattheworkplaceatalltimes.
ACWWschemeisanalternativearrangementwherebythenormalworkweekisreducedtolessthansix(6)
daysbutthetotalnumberofnormalworkhoursperweekshallremainatfortyeight(48)hours.Thenormalworkdayis
thusincreasedtomorethaneight(8)hourswithoutcorrespondingovertimepremium.Thisconceptcanbeadjusted
accordinglyincaseswherethenormalworkweekofthefirmisfive(5)days.
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PhilippineGraphicArts,Inc.v.NLRC,[G.R.No.L80737,September29,1988,166SCRA118].
TheHighCourtupheldthevalidityofthereductionofworkinghours,takingintoconsiderationthefollowing:
thearrangementwastemporary;itwasamorehumanesolutioninsteadoftheretrenchmentofpersonnel;therewere
notices and consultations with the workers and supervisors; a consensus was reached on how to deal with the
deterioratingeconomicconditions;anditwassufficientlyproventhatthecompanywassufferingfromlosses.
AlthoughthesaidExplanatoryBulletinofDirectorSanchezstandsmoreasasetofdirectoryguidelinesthana
bindingsetofimplementingrules,ithasonemainconsideration,consistentwiththerulinginPhilippineGraphicArts,in
determiningthevalidityofreductionofworkinghours,i.e.,thatthecompanywassufferingfromlosses.
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a.Compressedworkweekallowed.
Theemployermaycompresstheworkdaysfromsix(6)days(fromMondaytoSaturday)tofive(5)days(from
MondaytoFriday)undercertainconditionsimposedbytheDepartmentofLaborandEmployment.
Insituations,forinstance,wheretheemployeesworkweekwasfortyfive(45)hoursconsistingofeight(8)
hoursdailyfromMondaytoFridayandfive(5)hoursonSaturday,theemployermayproposetocompressorshorten
theworkweekfromMondaytoFridaywithworkfornine(9)hoursperdaywithoutovertimepayfortheexcessone(1)
hour. The Department of Labor and Employment (DOLE) normally does not interpose any objection to this kind of
schemeprovidedthefollowingconditionsaremet:
1. Theemployeesvoluntarilyagreetoworknine(9)hoursadayfromMondaytoFriday;
2. Thereshouldbenodiminutioninthetakehomepayandfringebenefitsoftheemployees;
3. Thevalueofthebenefitsthatwillaccruetotheemployeesundertheproposedworkscheduleismore
than or, at least, commensurate with, or equal to, the onehour overtime pay that is due them during
weekdaysbasedontheemployeesquantification;
4. Theonehourovertimepayoftheemployeeswillbecomedueanddemandableifevertheyarepermitted
ormadetoworkonanySaturdayduringtheeffectivityofthenewworkingtimearrangement,sincethe
agreementbetweentheemployeesandmanagementisthattherewillbenoSaturdayworkinexchange
foralongerworkdayduringweekdays;
5. The work of the employees does not involve strenuous physical exertion and they are provided with
adequaterestperiodsorcoffeebreaksinthemorningandafternoon;and
6. Theeffectivityoftheproposedworkingtimearrangementshouldbeoftemporarydurationasdetermined
bytheSecretaryofLaborandEmployment.
Conditions.DOLEshallrecognizeCWWschemesadoptedinaccordancewiththefollowing:
1. The CWW scheme is undertaken as a result of an express and voluntary agreement of majority of the
covered employees or their duly authorized representatives. This agreement may be expressed through collective
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bargainingorotherlegitimateworkplacemechanismsofparticipationsuchaslabormanagementcouncils,employee
assembliesorreferenda.
2.Infirmsusingsubstances,chemicalsandprocessesoroperatingunderconditionswherethereareairborne
contaminants,humancarcinogensornoiseprolongedexposuretowhichmayposehazardstotheemployeeshealth
andsafety,theremustbeacertificationfromanaccreditedhealthandsafetyorganizationorpractitionerorfromthe
firmssafetycommitteethatworkbeyondeight(8)hoursiswithinthresholdlimitsortolerablelevelsofexposure,asset
intheOSHS.
3.TheemployershallnotifytheDOLE,throughitsRegionalOfficehavingjurisdictionovertheworkplace,ofthe
adoptionoftheCWWscheme.ThenoticeshouldbemadeinDOLECWWReportForm.
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Thefollowingaretheeffectsofworkinterruptionduetobrownouts.9
1. Brownouts of short duration but not exceeding twenty (20) minutes shall be treated as worked or
compensablehourswhetherusedproductivelybytheemployeesornot.
2. Brownoutsrunningformorethantwenty(20)minutesmaynotbetreatedashoursworkedprovidedany
ofthefollowingconditionsarepresent:
a.Theemployeescanleavetheirworkplaceorgoelsewherewhetherwithinorwithouttheworkpremises;
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BisigManggagawasaTrycov.NLRC,[G.R.No.151309,October15,2008].
PrivaterespondentTrycoandthepetitionerssignedseparateMemorand[a]ofAgreement(MOA),providingfor
acompressedworkweekscheduletobeimplementedinthecompanyeffectiveMay20,1996.TheMOAwasentered
intopursuanttoDOLEDepartmentOrder(D.O.)No.21,Seriesof1990enunciatingtheGuidelinesontheImplementation
ofCompressedWorkweek.AsprovidedintheMOA,8:00a.m.to6:12p.m.,fromMondaytoFriday,shallbeconsidered
astheregularworkinghours,andnoovertimepayshallbedueandpayabletotheemployeeforworkrenderedduring
thosehours.TheMOAspecificallystatedthattheemployeewaivestherighttoclaimovertimepayforworkrendered
after5:00p.m.until6:12p.m.fromMondaytoFridayconsideringthatthecompressedworkweekscheduleisadoptedin
lieu of the regular workweek schedule which also consists of fortysix (46) hours. However, should an employee be
permittedorrequiredtoworkbeyond6:12p.m.,suchemployeeshallbeentitledtoovertimepay.Trycoinformedthe
BureauofWorkingConditions(BWC)oftheDepartmentofLaborandEmploymentoftheimplementationofthesaid
compressedworkweekinthecompany.
Inupholdingthevalidityofthecompressedworkweek,itwasnotedthatDepartmentOrderNo.21sanctions
the waiver of overtime pay in consideration of the benefits that the employees will derive from the adoption of a
compressedworkweekscheme,thus:
Thecompressedworkweekschemewasoriginallyconceivedforestablishmentswishingto
saveonenergycosts,promotegreaterworkefficiencyandlowertherateofemployeeabsenteeism,
amongothers.Workersfavortheschemeconsideringthatitwouldmeansavingsontheincreasing
cost of transportation fares for at least one (1) day a week; savings on meal and snack expenses;
longer weekends, or an additional 52 offdays a year, that can be devoted to rest, leisure, family
responsibilities,studiesandotherpersonalmatters,andthatitwillsparethemforatleastanother
day in a week from certain inconveniences that are the normal incidents of employment, such as
commutingtoandfromtheworkplace,traveltimespent,exposuretodustandmotorvehiclefumes,
dressingupforwork,etc.Thus,underthisscheme,thegenerallyobservedworkweekofsix(6)daysis
shortened to five (5) days but prolonging the working hours from Monday to Friday without the
employer being obliged for pay overtime premium compensation for work performed in excess of
eight (8) hours on weekdays, in exchange for the benefits abovecited that will accrue to the
employees.
Moreover, the adoption of the compressed workweek scheme in the company will help temper any
inconveniencethatwillbecausedthepetitionersbytheirtransfertoafartherworkplace.
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Effects.ACWWschemewhichcomplieswiththeforegoingconditionsshallhavethefollowingeffects:
1. Unless there is a more favorable practice existing in the firm, work beyond eight (8) hours will not be
compensablebyovertimepremiumprovidedthetotalnumberofhoursworkedperdayshallnotexceedtwelve(12)
hours.Inanycase,anyworkperformedbeyondtwelve(12)hoursadayorfortyeight(48)hoursaweekshallbesubject
toovertimepremium.
2.ConsistentwithArticles85oftheLaborCode,employeesunderaCWWschemeareentitledtomealperiods
of not less than sixty (60) minutes. Nothing, however, shall impair the right of employees to rest days as well as to
holiday pay, rest day pays or leaves in accordance with law or applicable collective bargaining agreement (CBA) or
companypractice.
3. Adoption of the CWW scheme shall in no case result in diminution of existing benefits. Reversion to the
normaleighthourworkdayshallnotconstituteadiminutionofbenefits.Thereversionshallbeconsideredalegitimate
exerciseofmanagementprerogativeprovidedthattheemployershallgivetheemployeespriornoticeofsuchreversion
withinareasonableperiodoftime.
Policy Instructions No. 36 dated May 22, 1978 was issued by the Undersecretary of Labor and Employment to clarify the effects of power interruptions or brown-outs on productive man-hours.
7

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b.Theemployeescanusethetimeeffectivelyfortheirowninterest.
3. Ineachcase,theemployermayextendtheworkinghoursofhisemployeesoutsidetheregularschedulesto
compensateforthelossofproductivemanhourswithoutbeingliableforovertimepay.
4. Industrialenterpriseswithoneortwoworkshiftsmayadoptanyoftheworkshiftsprescribedforenterprises
withthree(3)workshiftstopreventseriouslossordamagetomaterials,machineriesorequipmentthat
mayresultincaseofpowerinterruptions.10
5. Thedayswhenworkwasnotrequiredandnoworkcouldbedonebecauseofshutdownduetoelectrical
powerinterruptions,lackofrawmaterialsandrepairofmachines,arenotdeemedhoursworked.11
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7.MEALBREAKS(ARTICLE85,LABORCODE).
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a.Generalruleonmealperiod.
Asageneralrule,everyemployerisrequiredtogivehisemployees,regardlessofsex,notlessthanone(1)hour
(or60minutes)timeoffforregularmeals.12
Beingtimeoff,itisnotcompensablehoursworked.Inthiscase,theemployeeisfreetodoanythinghewants,
excepttowork.Ifheisrequired,however,toworkwhileeating,heshouldbecompensatedtherefor.
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e.Changingfrom30minutepaidoncalllunchbreakto1hourmealtimewithoutpay,effect.
ThecaseofSimeDarbyPilipinas,Inc.v.NLRC,[G.R.No.119205,April15,1998,289SCRA86],isillustrativeof
this point. Prior to the present controversy, all company factory workers in Marikina including members of private
respondentunionworkedfrom7:45a.m.to3:45p.m.witha30minutepaidoncalllunchbreak.Petitioner,bywayof
a memorandum, changed the meal time schedule from 30 minutes to one (1) hour without pay. Since private
respondentfeltaffectedadverselybythechangeintheworkscheduleanddiscontinuanceofthe30minutepaidon
call lunch break, it filed on behalf of its members a complaint with the Labor Arbiter for unfair labor practice,
discriminationandevasionofliability.Indeclaringthechangeintheworkscheduleasvalid,theSupremeCourtheld:
(The petitioner) rationalizes that while the old work schedule included a 30minute paid
lunch break, the employees could be called upon to do jobs during that period as they were on
call.Evenifdenominatedaslunchbreak,thisperiodcouldverywellbeconsideredasworkingtime
because the factory employees were required to work if necessary and were paid accordingly for
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d.Shorteningofmealtimetolessthan20minutes,effect.
Thelawdoesnotallowthatmealtimebeshortenedtolessthantwenty(20)minutes.Ifsoreduced,thesame
shall no longer be considered as meal time but merely as rest period or coffee break and, therefore, becomes
compensableworkingtime.15
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c.Shorteningofmealtimetonotlessthan20minutes,whennotcompensable.
Thelawallowsasituationwheretheemployeesthemselvesrequestfortheshorteningofmealperiodtonot
lessthantwenty(20)minutes(say,thirtyminutes,orfrom12:00to12:30p.m.insteadof12:00to1:00p.m.)forthe
purposeofallowingthemtoleaveworkearlierthanthelapseoftheeight(8)hoursrequiredbylaw(say,4:30p.m.
insteadof5:00p.m.).Thisshortenedperiod,however,shallnotbeconsideredcompensableworkingtimeprovidedthe
followingconditionsarecompliedwith:
a. The employees voluntarily agree in writing to a shortened meal period of thirty (30) minutes and are
willingtowaivetheovertimepayforsuchshortenedmealperiod;
b. Thereshouldbenodiminutioninthebenefitsoftheemployeeswhichtheyreceivepriortotheeffectivity
oftheshortenedmealperiod;
c. The work of the employees does not involve strenuous physical exertion and they are provided with
adequatecoffeebreaksinthemorningandafternoon;
d. Thevalueofthebenefitsderivedbytheemployeesfromtheproposedworkarrangementisequaltoor
commensuratewiththecompensationduethemfortheshortenedmealperiodaswellastheovertime
payfor30minutesasdeterminedbytheemployeesconcerned;
e. Theovertimepayoftheemployeeswillbecomedueanddemandableifevertheyarepermittedormade
toworkbeyond4:30p.m.;and
f. Theeffectivityoftheproposedworkingtimearrangementshallbeforatemporarydurationasdetermined
bytheSecretaryofLaborandEmployment.14
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b.Shorteningofmealtimetonotlessthan20minutes,whencompensable.
In the following cases, a meal period of not less than twenty (20) minutes may be given by the employer
providedthatsuchshortermealperiodiscreditedascompensablehoursworkedoftheemployee:
a.Wheretheworkisnonmanualworkinnatureordoesnotinvolvestrenuousphysicalexertion;
b.Wheretheestablishmentregularlyoperatesfornotlessthansixteen(16)hoursaday;
c.Incasesofactualorimpendingemergenciesorwhenthereisurgentworktobeperformedonmachineries,
equipmentorinstallationstoavoidseriouslosswhichtheemployerwouldotherwisesuffer;and
d.Wheretheworkisnecessarytopreventseriouslossofperishablegoods.13
Policy Instructions No. 36, May 22, 1978.

Durabilt Recapping Plant Company v. NLRC, G.R. No. L-76746, July 27, 1987, 152 SCRA 328.
Article 85, Labor Code; Section 7, Rule I, Book III, Rules to Implement the Labor Code.
13 Section 7, Rule I, Book III, Ibid..
14 Letter-Opinion dated Nov. 27, 1989 of Secretary Franklin Drilon to Kodak Philippines.
15 Last paragraph, Section 7, Rule I, Book III, Rules to Implement the Labor Code.
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working.Withthenewworkschedule,theemployeesarenowgivenaonehourlunchbreakwithout
anyinterruptionfromtheiremployer.Forafullonehourundisturbedlunchbreak,theemployeescan
freelyandeffectivelyusethishournotonlyforeatingbutalsofortheirrestandcomfortwhichare
conducive to more efficiency and better performance in their work. Since the employees are no
longer required to work during this onehour lunch break, there is no more need for them to be
compensated for this period.We agree with the Labor Arbiter that the new work schedule fully
complieswiththedailyworkperiodofeight(8)hourswithoutviolatingtheLaborCode.Besides,the
new schedule applies to all employees in the factory similarly situated whether they are union
membersornot.
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f.Mealtimeinvolvingseveralshifts.
Inacompanywhereworkiscontinuousforseveralshifts,themealtimebreaksshouldbecountedasworking
time for purposes of overtime compensation. Consequently, the workers who are required to work in two (2) full
successiveshiftsshouldbepaidforsixteen(16)hoursandnotfourteen(14),thetwohoursforrestormealtimebreaks
beingincludedascompensableworkingtime.Theidletimethatanemployeemayspendforrestingwhereinhemay
leavetheworkareashouldnotbecountedasworkingtimeonlywhentheworkisnotcontinuous.16
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8.1.IDLETIME.
Theidletimeduringwhichanotherwiseoffdutyemployeeremainsavailabletobecalledtoworkmayor
maynotbecompensable,dependinguponthesituation.Asageneralrule,theissueofcompensabilitydependson
whetherthetimeisspentprimarilyfortheemployersbenefitasopposedtotheemployees.Theanswerusually
turnsupontheextenttowhichemployeeisabletoanddoesusethetimeeffectivelyforpersonalpurposes.
An evaluation of all the relevant facts become necessary to determine compensability. The following,
amongothers,shouldbeconsidered:
a. Theemployerrequirestheemployeetoremainontheemployerspremises;
b. Theemployerrequirestheemployeetowaitathomeforcallsormessagesorconfinestheemployee
toahighlyrestrictedgeographicalarea;
c. Theemployeereceivesnumerousorfrequentworkassignmentsduringtheoncallperiod;
d. The employee must respond within a short timeframe under the circumstances (especially if the
employeemusttravelsomewheretodothework);
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b.Someprinciplesindetermininghoursworked.
The following general principles shall govern in determining whether the time spent by an employee is
consideredhoursworked:
a. Allhoursarehoursworkedwhichtheemployeeisrequiredtogivetohisemployer,regardlessofwhether
ornotsuchhoursarespentinproductivelabororinvolvephysicalormentalexertion;
b. An employee need not leave the premises of the workplace in order that his rest period shall not be
counted,itbeingenoughthathestopsworking,mayrestcompletelyandmayleavehisworkplacetogo
elsewhere,whetherwithinoroutsidethepremisesofhisworkplace;
c. Iftheworkperformedwasnecessaryoritbenefitedtheemployerortheemployeecouldnotabandonhis
workattheendofhisnormalworkinghoursbecausehehadnoreplacement,alltimespentforsuchwork
shallbeconsideredashoursworkediftheworkwaswiththeknowledgeofhisemployerorimmediate
supervisor;
d. Thetimeduringwhichanemployeeisinactivebyreasonofinterruptionsinhisworkbeyondhiscontrol
shall be considered working time either if the imminence of the resumption of work requires the
employees presence at the place of work or if the interval is too brief to be utilized effectively and
gainfullyintheemployeesowninterest.(Section4,RuleI,BookIII,RulestoImplementtheLaborCode).
It bears emphasizing that the employer retains the management prerogative, whenever exigencies of the
servicesorequire,tochangetheworkinghoursofitsemployees.18
Moreover, the ageold rule which governs the relationship between labor and capital or management and
employeeofafairdayswageforafairdayslabor,remainsthebasicfactorindeterminingtheemployeeswagesand
backwages.19
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a.Compensablehoursworked.
Thefollowingshallbeconsideredascompensablehoursworked:
a. Alltimeduringwhichanemployeeisrequiredtobeondutyortobeattheemployerspremisesortobe
ataprescribedworkplace;and
b. Alltimeduringwhichanemployeeissufferedorpermittedtowork.17
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8.IDLETIME,WAITINGTIME,COMMUTINGTIME,TRAVELTIME,WHETHERPARTOFHOURSOFWORKORNOT.
(ARTICLE84,LABORCODE).
National Development Company v. Court of Industrial Relations, G.R. No. L-15422, Nov. 30, 1962.
Article 84, Labor Code; Section 3, Rule I, Book III, Rules to Implement the Labor Code; Rada v. NLRC, G.R. No. 96078, Jan. 9, 1992, 205 SCRA 69.
Union Carbide Labor Union v. Union Carbide Philippines, Inc., 215 SCRA 554 [1992].
19 Durabilt Recapping Plant Company v. NLRC, G.R. No. L-76746, July 27, 1987, 152 SCRA 328.
16
17
18
9

e. Requirestheemployeetobeoncallfrequently,neverrelievestheemployeefromoncallstatus,does
notpermittheemployeetoexchangecallsorcallperiodswithanotherworker,ordoesnotallowthe
employeetoturndownatleastsomecalls;and
f. Thereisanagreementorunderstandingcoveringthearrangement.
Somecombinationoftheforegoingfactorsispresentwhenidleoncalltimeisfoundtobecompensable
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8.2.WAITINGTIME.
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c.OffDuty
Based on U.S. jurisprudence, periods during which an employee is completely relieved from duty and
which are long enough to enable him to use the time effectively for his own purposes are not hours worked.
Whethertimeoffworkistrulysufficienttoenableemployeestoeffectivelyusethetimefortheirownpurposesis
afactualissuedependentuponthecircumstances.
Circumstances considered by the courts include the duration of the time off and any other facts which
mayplacerestrictionsontheemployees.Examplesofcaseswherecourtshavefoundthatemployersarejustified
indenyingcompensationforidletimeinclude:
Atelephonedispatcherwhoonlyhadtoanswerasmallnumberoftelephonecallsfornonemergency
ambulance care each night and who was allowed to pursue her own personal, social and business
activitiesduringtheeveninghours;
Employeeswhowererequiredtoliveontheemployer'spremisesduringtheiroffshifthours,butwho
werefreeduringtheiroffdutytimetosleep,eat,watchtelevision,exercise,playpingpongorcards,
readandengageinotherpersonalamusements;and
Truck drivers responsible for picking up and delivering the mail who were free to attend to personal
mattersandoccupytheirtimeastheydesiredduringthewaitingtimebetweenscheduledruns.
20
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b.OnDuty.
Waitingtimewhileondutyisincludedincompensabletime,especiallywhenitisunpredictable,orisof
suchshortdurationthattheemployeescannotusethetimeeffectivelyfortheirownpurposes.Inthoseinstances,
the employees are to be compensated whether their work is on or off the employer's premises, even if the
employees spend the time engaging in such amusements as playing cards, watching television or reading.
Examples in American jurisprudence where employees were found to be engaged in compensable waiting time
include:
Assemblylineworkerswhoexperiencedidletimeof45minutesorlessduetodelaysindeliveryand
mechanicalfailures;
Awellpumperwhoresidedontheemployer'spremisesandwhowasrequiredtobeondutyatleast
eighthoursperday,sevendaysperweektopumpwellsandrepairmachinerywhenneeded;
Restaurantemployeeswhowererequiredbytheiremployertoreporttoworkatacertaintimeeven
thoughtheycouldnotpunchinuntilenoughcustomerswerepresenttomakeworkavailable;
Truckwasherswhowereidlewhilewaitingforthearrivalofthenexttruck;
Truckdriverscarryingthemailwhohadperiodiclayoverslastingtwohoursorlessduetoloadingor
unloadingproblems;43
Oilwellcasingcrewswhohadtowaitforcasingsaftertheysetuptheirequipment;
Truckdriversandhelperswhowererequiredbytheiremployertowaitonpremisesforassignments;
and
Employeeswhoexperiencedoccasionalidletimecausedbymachinerybreakdowns.
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a.Whenwaitingtimeiscompensable.
Waitingtimespentbyanemployeeshallbeconsideredasworkingtimeifwaitingisanintegralpartofhiswork
ortheemployeeisrequiredorengagedbytheemployertowait.20
InAricav.NLRC,[G.R.No.78210,February28,1989,170SCRA776],itwasruledthatthe30minuteassembly
timepracticedbytheemployeesofthecompanycannotbeconsideredwaitingtimeandshouldnot,therefore,be
compensable.
Although it is clear that employers must compensate employees for time actually spent working,
questions arise as to whether the minimum wage and overtime provisions of the FLSA also apply to time spent
waitingtoperformproductivework.Undertheregulations,whetherwaitingtimeistimeworkeddependsonthe
particularcircumstances.
Timespentwaitingforworkiscompensableifitisspent"primarilyforthebenefitoftheemployerand
[its] business." Conversely, if the time is spent primarily for the benefit of the employee, the time is not
compensable.Indeterminingwhetherwaitingtimeconstituteshoursworked,theamountofcontroltheemployer
hasovertheemployeeduringthewaitingtime,andwhethertheemployeecaneffectivelyusethattimeforhis
ownpurposesismaterial.
Section 5 [a], Rule I, Book III, Ibid..
10

8.3.COMMUTINGTIMEANDTRAVELTIME.
The rules applicable to travel time in accordance with the Manual issued by the Department of Labor and
Employmentarediscussedbelow.
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a.Travelfromhometowork.
Anemployeewhotravelsfromhomebeforehisregularworkdayandreturnstohishomeattheendofthe
workday is engaged in ordinary hometowork travel which is a normal incident of employment and, therefore, not
consideredashoursworked.Thisistruewhetherheworksatafixedlocationoratdifferentjobsites.
Butwhilenormaltravelfromhometoworkisnotworkingtime,ifanemployeereceivesanemergencycall
outsideofhisregularworkinghoursandisrequiredtotraveltohisregularplaceofbusinessorsomeotherworksite,all
ofthetimespentinsuchtravelisconsideredworkingtime.
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Premiumpayreferstotheadditionalcompensationrequiredbylawforworkperformedwithineight(8)
hoursonnonworkingdays,suchasrestdaysandspecialdays.21
21
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a.Someprinciplesonovertimework.
1.Workrenderedafternormaleight(8)hoursofworkiscalledovertimework.
2. In computing overtime work, "regular wage" or "basic salary" means "cash" wage only without
deductionforfacilitiesprovidedbytheemployer.
3."Premium pay" means the additional compensation required by law for work performed within 8
hoursonnonworkingdays,suchasregularholidays,specialholidaysandrestdays.
4. "Overtime pay" means the additional compensation for work performed beyond 8 hours. Every
employeeentitledtopremiumpayisalsoentitledtothebenefitofovertimepay.
5.Illustrationsonhowovertimeiscomputed:
a.Forovertimeworkperformedonanordinaryday,theovertimepayisplus25%ofthe
basichourlyrate.
b.Forovertimeworkperformedonarestdayoronaspecialday,theovertimepayis
plus 30% of the basic hourly rate which includes 30% additional compensation as
providedinArticle93[a]oftheLaborCode.
c. Forovertimeworkperformedonarestdaywhichfallsonaspecialday,theovertime
payisplus30%ofthebasichourlyratewhichincludes50%additionalcompensationas
providedinArticle93[c]oftheLaborCode.
d. Forovertimeworkperformedonaregularholiday,theovertimepayisplus30%of
the basic hourly rate which includes 100% additional compensation as provided in
Article94[b]oftheLaborCode.
e. For overtime work performed on a rest day which falls on a regular holiday, the
overtime pay is plus 30% of the basic hourly rate which includes 160% additional
compensation.
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b.Travelthatisallinthedayswork.
Timespentbyanemployeeintravelaspartofhisprincipalactivity,suchastravelfromjobsitetojobsiteduring
theworkday,mustbecountedashoursworked.Whereanemployeeisrequiredtoreportatameetingplacetoreceive
instructionsortoperformotherworkthere,ortopickandtocarrytools,thetravelfromthedesignatedplacetothe
workplaceispartofthedaysworkandmustbecountedashoursworkedregardlessofcontract,customorpractice.If
anemployeenormallyfinisheshisworkonthepremisesat5:00p.m.andissenttoanotherjobwhichhefinishedat8:00
p.m.andisrequiredtoreturntohisemployerspremisesarrivingat9:00p.m.,allofthetimeisworkingtime.However,
iftheemployeegoeshomeinsteadofreturningtohisemployerspremises,thetravelafter8:00p.m.ishometowork
travelandisnothoursworked.
c.Travelawayfromhome.
Travelthatkeepstheemployeeawayfromhomeovernightistravelawayfromhome.Travelawayfromhome
isclearlyworkingtimewhenitcutsacrosstheemployeesworkday.Theemployeeissimplysubstitutingtravelforother
duties. The time isnotonlyhours worked on regular workingdays during normal workinghoursbutalsoduring the
corresponding hours on nonworking days. Thus, if an employee regularly works from 9:00 a.m. to 5:00 p.m. from
MondaythroughFriday,thetraveltimeduringthesehoursisworkingtime.Regularmealperiodisnotcounted.Asan
enforcementpolicy,theDepartmentofLaborandEmploymentdoesnotconsiderasworkingtimethattimespentin
travelawayfromhomeoutsideofregularworkinghoursasapassengeronanairplane,train,boat,busorautomobile.
Anyworkwhichanemployeeisrequiredtoperformwhiletravellingmustbecountedashoursworked.An
employeewhodrivesatruck,bus,automobile,boatorairplaneoranemployeewhoisrequiredtoridethereinasan
assistantorhelper,isworkingwhileriding,exceptduringbonafidemealperiodsorwhenheispermittedtosleepin
adequatefacilitiesfurnishedbytheemployer.
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No. III, DOLE Handbook on Workers Statutory Monetary Benefits.
11

Overtimepayreferstotheadditionalcompensationforworkperformedbeyondeight(8)hoursaday.
Everyemployeewhoisentitledtopremiumpayislikewiseentitledtothebenefitofovertimepay.22
9.1.EMERGENCYOVERTIMEWORK(ARTICLE89,LABORCODE).
a.Generalrule.
Thegeneralruleremainsthatnoemployeemaybecompelledtorenderovertimeworkagainsthiswill
an
b.Exceptionswhenemployeemaybecompelledtorenderovertimework:
1. Whenthecountryisatwarorwhenanyothernationalorlocalemergencyhasbeendeclaredbythe
NationalAssemblyortheChiefExecutive;
2.Whenovertimeworkisnecessarytopreventlossoflifeorpropertyorincaseofimminentdangerto
public safety due to actual or impending emergency in the locality caused by serious accident, fire,
floods,typhoons,earthquake,epidemicorotherdisastersorcalamities;
3. Whenthereisurgentworktobeperformedonmachines,installationsorequipment,orinorderto
avoidseriouslossordamagetotheemployerorsomeothercausesofsimilarnature;
4. Whentheworkisnecessarytopreventlossordamagetoperishablegoods;
5. When the completion or continuation of work started before the 8th hour is necessary to prevent
seriousobstructionorprejudicetothebusinessoroperationsoftheemployer;and
6. When overtime work is necessary to avail of favorable weather or environmental conditions where
performanceorqualityofworkisdependentthereon.
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Therighttoclaimovertimepayisnotsubjecttoawaiver.Suchrightisgovernedbylawandnotmerelybythe
agreementoftheparties.23
Whilerightsmaybewaived,thesamemustnotbecontrarytolaw,publicorder,publicpolicy,moralsorgood
customsorprejudicialtoathirdpersonwitharightrecognizedbylaw.24
Butifthewaiverisdoneinexchangeforandinconsiderationofcertainvaluableprivileges,amongthemthatof
beinggiventipswhendoingovertimework,therebeingnoproofthatthevalueofsaidprivilegesdidnotcompensatefor
suchwork,suchwaivermaybeconsideredvalid.25
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a.Nightshiftdifferential.
Nightshiftdifferentialisequivalentto10%ofemployee'sregularwageforeachhourofworkperformed
between10:00p.m.and6:00a.m.ofthefollowingday.
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b.Nightshiftdifferentialandovertimepay,distinguished
Whentheworkofanemployeefallsatnighttime,thereceiptofovertimepayshallnotprecludetheright
to receive night differential pay. The reason is, the payment of the night differential pay is for the work done
during the night; while the payment of the overtime pay is for work in excess of the regular eight (8) working
hours.
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c.ComputationofNightShiftDifferentialPay:
1.Wherenightshift(10p.m.to6a.m.)workisregularwork.
a. Onanordinaryday:Plus10%ofthebasichourlyrateoratotalof110%ofthebasichourly
rate.
b.Onarestday,specialdayorregularholiday:Plus10%oftheregularhourlyrateonarestday,
specialdayorregularholidayoratotalof110%oftheregularhourlyrate.
2.Wherenightshift(10p.m.to6a.m.)workisovertimework.
a.Onanordinaryday:Plus10%oftheovertimehourlyrateonanordinarydayoratotalof110%
oftheovertimehourlyrateonanordinaryday.
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Thefollowingrulesshallapply:
1. Undertimeworkonanyparticulardayshallnotbeoffsetbyovertimeonanyotherday.
2. Permissiongiventotheemployeetogoonleaveonsomeotherdayoftheweekshallnotexemptthe
employerfrompayingtheadditionalcompensationrequiredbylawsuchasovertimepayornightshift
differentialpay.
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c.Mayanemployeevalidlyrefusetorenderovertimeworkunderanyoftheaforesaidcircumstances?
Anemployeecannotvalidlyrefusetorenderovertimeworkifanyoftheaforementionedcircumstances
ispresent.Whenanemployeerefusestorenderemergencyovertimeworkunderanyoftheforegoingconditions,
hemaybedismissedonthegroundofinsubordinationorwillfuldisobedienceofthelawfulorderoftheemployer.
to
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No. IV, Ibid..

Mercader v. Manila Polo Club, G.R. No. L-8373, Sept. 28, 1956; Cruz v. Yee Sing, G.R. No. L-12046, Oct. 1959; Manila Terminal Co., Inc. v. CIR, G.R. No. L-9265, April 29, 1957, 48 O. G. 7, p. 2725, 91 Phil. 625.
Article 6, Civil Code; Pampanga Sugar Development Co., Inc. v. Court of Industrial Relations, G.R. No. L-39387, June 29, 1982.
25 Meralco Workers Union v. Manila Electric Co., G.R. No. L-11876, May 29, 1959.
22
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b. Onarestdayorspecialdayorregularholiday:Plus10%oftheovertimehourlyrateonarest
dayorspecialdayorregularholiday.
3. For overtime work in the night shift. Since overtime work is not usually eight (8) hours, the
compensationforovertimenightshiftworkisalsocomputedonthebasisofthehourlyrate.
a.Onanordinaryday.Plus10%of125%ofbasichourlyrateoratotalof110%of125%ofbasic
hourlyrate.
b.Onarestdayorspecialdayorregularholiday.Plus10%of130%ofregularhourlyrateonsaid
daysoratotalof110%of130%oftheapplicableregularhourlyrate.
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11.CBAPROVISIONVISVISOVERTIMEWORK.
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a.Validityofstipulatedovertimerates.
Generally, the premium pay for work performed on the employees rest days or on special days or regular
holidaysisincludedaspartoftheregularrateoftheemployeeinthecomputationofovertimepayforanyovertime
workrenderedonsaiddays,especiallyiftheemployerpaysonlytheminimumovertimeratesprescribedbylaw.The
employees and employer, however, may stipulate in their collective bargaining agreement (CBA) the payment of
overtimerateshigherthanthoseprovidedbylawandexcludethepremiumpaymentsinthecomputationofovertime
pay.Suchagreementmaybeconsideredvalidonlyifthestipulatedovertimepayrateswillyieldtotheemployeesnot
lessthantheminimumprescribedbylaw.26
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2.COVERAGE/EXCLUSIONS(ARTICLE97,LABORCODE).
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a.Actualwork,thebasisofclaimforwages.
Itmustbeemphasizedthattheageoldrulegoverningtherelationbetweenlaborandcapital,ormanagement
andemployeeofnowork,nopayorfairdayswageforfairdayslaborremainstobeadheredinourjurisdictionas
thebasicfactorindeterminingthewagesofemployees.Iftheworkerdoesnotwork,heisgenerallynotentitledtoany
wageorpay.Theexceptioniswhenitwastheemployerwhoundulypreventedhimfromworkingdespitehisableness,
willingnessandreadinesstowork;orincaseswhereheisillegallylockedoutorillegallysuspendedorillegallydismissed,
orotherwiseillegallypreventedfromworking,inwhichevent,heshouldbeentitledtohiswage.28
a.Coverage.
The minimum wage rates prescribed by law shall be the basic cash wages without deduction therefrom of
whateverbenefits,supplementsorallowanceswhichtheemployeesenjoyfreeofchargeasidefromthebasicpay.29
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1.NOWORK,NOPAYPRINCIPLE.
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C. LABOR STANDARDS
2. Wages
a. No work no pay principle
b. Coverage/Exclusions
c. Facilities vs supplements
d. Wages vs. salaries
e. Wage distortion
f. CBA vis--vis Wage Orders CBA creditability
g. Non-diminution of benefits
h. Workers preference in case of bankruptcy
i. Labor Code provisions for wage protection
j. Allowable deductions without employees consent
k. Attorneys fees and union service fee in labor cases
l. Criteria/Factors for Wage Setting
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b.Builtinovertimepay.
Incasetheemploymentcontractstipulatesthatthecompensationincludesbuiltinovertimepayandthesame
isdulyapprovedbytheDirectoroftheBureauofEmploymentServices(nowBureauofLocalEmployment),thenon
paymentbytheemployerofanyovertimepayforovertimeworkisjustifiedandvalid.27
In PAL Employees Savings and Loan Association, Inc. [PESALA] v. NLRC, [G.R. No. 105963, August 22, 1996],
wheretheperiodofnormalworkinghoursperdaywasincreasedtotwelve(12)hours,itwasheldthattheemployer
remains liable for whatever deficiency in the amount for overtime work in excess of the first eight (8) hours, after
recomputationshowssuchdeficiency.
No. IV [D], DOLE Handbook on Workers Statutory Monetary Benefits.

Engineering Equipment, Inc. v. Minister of Labor, G.R. No. L-64967, Sept. 23, 1985
Aklan Electric Cooperative v. NLRC, G.R. No. 121439, Jan. 25, 2000; Philippine Airlines v. NLRC, G.R. No. 55159, June 22, 1989; Caltex Refinery Employees Association v. Brillantes, G.R. No. 123782, Sept. 16, 1997, 279 SCRA 218; Durabilt Recapping Plant Company v. NLRC, G.R.
No. L-76746, July 27, 1987, 152 SCRA 328; SSS v. SSS Supervisors Union, G.R. No. L-31832, Oct. 23, 1982; J. P. Heilbronn Co. v. National Labor Union, G.R. No. L-5121, Jan. 20, 1953.
29 Section 1, Rule VII-A, Book III, Rules to Implement the Labor Code, as amended by Memorandum Circular No. 3, Nov. 4, 1992.
26
27
28
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b.Exclusions.
Thetermbasicwagemeansalltheremunerationorearningspaidbyanemployertoaworkerforservices
renderedonnormalworkingdaysandhoursbutdoesnotincludecostoflivingallowances,profitsharingpayments,
premiumpayments,13thmonthpayorothermonetarybenefitswhicharenotconsideredaspartoforintegratedinto
theregularsalaryoftheworkersonthedatethislawbecameeffective.30
Further,asheldinHondaPhils.,Inc.v.SamahanngMalayangManggagawasaHonda,[G.R.No.145561,June
15,2005,460SCRA187],thefollowingshouldbeexcludedfromthecomputationofbasicsalary,towit:paymentsfor
sick,vacationandmaternityleaves,nightdifferentials,regularholidaypayandpremiumsforworkdoneonrestdays
andspecialholidays.31
3.FACILITIESVS.SUPPLEMENTS.
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a.Facilities,defined.
The term facilities includes articles or services for the benefit of the employee or his family but does not
includetoolsofthetradeorarticlesorservicesprimarilyforthebenefitoftheemployerornecessarytotheconductof
the employers business.32 They are items of expense necessary for the laborers and his familys existence and
subsistencewhichformpartofthewageandwhenfurnishedbytheemployer,aredeductibletherefrom,sinceifthey
arenotsofurnished,thelaborerwouldspendandpayforthemjustthesame.33
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a.Wageandsalary,distinguished.40
1. The term wage is used to characterize the compensation paid for manual skilled or unskilled labor.
Salary, on the other hand, is used to describe the compensation for higher or superior level of
employment.
2. Incasesofexecution,attachmentorgarnishmentofthecompensationofanemployeereceivedfromwork
issuedbythecourttosatisfyajudiciallydeterminedobligation,adistinctionshouldbemadewhethersuch
compensation is considered wage or salary. Under Article 1708 of the Civil Code, if considered a
wage, the employees compensation shall not be subject to execution or attachment or garnishment,
except for debts incurred for food, shelter, clothing and medical attendance. If deemed a salary, such
compensationisnotexemptfromexecutionorattachmentorgarnishment.Thus,thesalary,commission
andotherremunerationreceivedbyamanagerialemployee(asdistinguishedfromanordinaryworkeror
Item [n], Definition of Terms, Rules Implementing Republic Act No. 6727.
See also San Miguel Corporation Cagayan Coca-Cola Plant v. Inciong, G.R. No. L-49774, Feb. 24, 1981, 103 SCRA 139.
Section 2, Rule VII-A, Book III, Rules to Implement the Labor Code, as amended by Memorandum Circular No. 3, Nov. 4, 1992.
33 State Marine Cooperation and Royal Line, Inc. v. Cebu Seamens Association, Inc., G.R. No. L-12444, Feb. 28, 1963; Atok Big Wedge Mining Co., Inc. v. Atok Big Wedge Mutual Benefit Association, G.R. No. L-5276, March 3, 1953, 97 Phil. 294.
34 States Marine Cooperation and Royal Line, Inc. v. Cebu Seamens Association, Inc., G.R. No. L-12444, Feb. 28, 1963, 7 SCRA 294; Atok Big Wedge Mining Co., Inc. v. Atok Big Wedge Mutual Benefit Association, G.R. No. L-5276, March 3, 1953, 97 Phil. 294
35 States Marine Corporation and Royal Line, Inc. v. Cebu Seamens Association, Inc., infra; Mayon Hotel & Restaurant v. Adana, supra; Mabeza v. NLRC, supra.
36 States Marine Corporation and Royal Line, Inc. v. Cebu Seamens Association, Inc., [G.R. No. L-12444, February 28, 1963, 7 SCRA 294].
37 Mabeza v. NLRC, [G.R. No. 118506, April 18, 1997, 271 SCRA 670].
38 Section 1, Rule VII-A, Book III, Rules to Implement the Labor Code, as amended by Memorandum Circular No. 3, Nov. 4, 1992.
39 S.I.P. Food House v. Batolina, [G.R. No. 192473, October 11, 2010],
40 The terms wage (etymologically from the Middle English word wagen), salary (from the Roman word sal and Latin word salarium) are synonymous in meaning and usage. They all refer to the same thing, i.e., a compensation paid on account of work or services rendered.
30
31
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4.WAGESVS.SALARIES.
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d.Someprinciplesonfacilitiesandsupplements.
1. Facilitiesaredeductiblebutnotsupplements.36
2. Legal requirements must be complied with before deducting facilities from wages. The employer simply
cannotdeductthevaluefromtheemployeeswageswithoutsatisfyingthefollowing:
(a) proofthatsuchfacilitiesarecustomarilyfurnishedbythetrade;
(b) theprovisionofdeductiblefacilitiesisvoluntarilyacceptedinwritingbytheemployee;and
(c) thefacilitiesarechargedatfairandreasonablevalue.37
3. Anemployermayprovidesubsidizedmealsandsnackstohisemployeesprovidedthatthesubsidyshallnot
be less than thirty percent (30%) of the fair and reasonable value of such facilities. In such a case, the
employermaydeductfromthewagesoftheemployeesnotmorethanseventypercent(70%)ofthevalue
of the meals and snacks enjoyed by the employees, provided that such deduction is with the written
authorizationoftheemployeesconcerned.38
4. The free board and lodging petitioner SIP furnished its employees cannot operate as a setoff for the
underpaymentoftheirwages.39
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c.Facilitiesandsupplements,distinguished.
Thebenefitorprivilegegiventotheemployeewhichconstitutesanextraremunerationoverandabovehis
basicorordinaryearningorwage,issupplement;andwhensaidbenefitorprivilegeispartofthelaborersbasicwage,it
isafacility.Asearlierpointedout,thecriterionisnotsomuchwiththekindofthebenefitoritem(food,lodging,bonus
orsickleave)givenbutitspurpose.Thus,freemealssuppliedbytheshipoperatortocrewmembers,outofnecessity,
cannotbeconsideredasfacilitiesbutsupplementswhichcouldnotbereducedhavingbeengivennotaspartofwages
butasanecessarymatterinthemaintenanceofthehealthandefficiencyofthecrewpersonnelduringthevoyage.35
Ch
Ch
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b.Supplements,defined.
Thetermsupplementsmeansextraremunerationorspecialprivilegesorbenefitsgiventoorreceivedbythe
laborersoverandabovetheirordinaryearningsorwages.34
32
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laborer) cannot be considered wages. Salary is understood to relate to a position or office, or the
compensationgivenforofficialorotherservice;whilewageisthecompensationforlabor.41
5.WAGEDISTORTION(ARTICLE124,LABORCODE).
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MinimumWage=%xPrescribedIncrease=DistortionAdjustment
ActualSalary
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Theaboveformulawasheldtobejustandequitable.
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d.Someprinciplesonwagedistortion.
1. Nowagedistortionincasewageincreasesweregrantedbyawageordertoemployeesinoneregionand
thesamearenotgrantedtotheircounterpartsinotherregionswhoarenotcoveredbythesamewage
order.46
2. In correcting wage distortion, the law does not require that the difference which had previously existed
betweenandamongtheemployeesofdifferentclassesberestoredinexactlythesameamount.Whatis
requiredissubstantialdifferenceinsuchwagerates.47
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6.CBAVISVISWAGEORDERSCBACREDITABILITY(ARTICLE125,LABORCODE).
Pr
a.WageincreasesandbenefitsfromCBAdifferentfromthosegrantedbylaw.
WageincreasesandbenefitsderivedfromlawandwageorderandthosefromtheCBAorcompanypolicyor
practiceareseparateanddistinctfromeachother,unlessotherwiseprovidedbytheagreementitselforbylaw.48
Gaa v. CA, infra; See also Equitable Banking Corp. v. Sadac, G.R. No. 164772, June 8, 2006.
Article 124, Labor Code; Item [p], Definition of Terms, Rules Implementing Republic Act No. 6727; Section 4 [m], Rule I, NWPC Guidelines No. 01, Series of 2007, June 19, 2007 [Amended Rules of Procedure on Minimum Wage Fixing; See also Section 1[l], Rule II, NCMB Revised
Procedural Guidelines in the Conduct of Voluntary Arbitration Proceedings [Oct. 15, 2004].
43 National Federation of Labor v. NLRC, G.R. No. 103586, July 21, 1994, 234 SCRA 311; See also Metropolitan Bank and Trust Company Employees Union-ALU-TUCP v. NLRC, [G.R. No. 102636, Sept. 10, 1993, 226 SCRA 268; Cardona v. NLRC, G.R. No. 89007, March 11, 1991,
195 SCRA 92; Associated Labor Unions-TUCP v. NLRC, G.R. No. 109328, Aug. 16, 1994, 235 SCRA 395.
44 Prubankers Association v. Prudential Bank and Trust Company, [G.R. No. 131247, January 25, 1999, 302 SCRA 74].
45 National Federation of Labor v. NLRC, G.R. No. 103586, July 21, 1994, 234 SCRA 311.
46 Prubankers Association v. Prudential Bank and Trust Company, [supra].
47 National Federation of Labor v. NLRC, G.R. No. 103586, July 21, 1994, 234 SCRA 311; Metro Transit Organization, Inc. v. NLRC, G.R. No. 116008, July 11, 1995, 245 SCRA 767.
48 Meycauayan Colleges v. Drilon, G.R. No. 81144, May 7, 1990; Universal Corn Products v. NLRC, 153 SCRA 191; Citibank Philippines Employees Union-NATU v. Minister of Labor, 97 SCRA 52; Roche [Philippines], v. NLRC, G.R. No. 83335, Oct. 5, 1989; Philippine Apparel Workers
Union v. NLRC, G.R. No. L-50320, July 31, 1981, 106 SCRA 444.
41
42
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c.Formulaforresolvingwagedistortion.
InthecaseofMetropolitanBankandTrustCompanyEmployeesUnionALUTUCPv.NLRC,[G.R.No.102636,
September10,1993],theSupremeCourthasgivenitsimprimaturtothefollowingformulaforthecorrectionofwage
distortioninthepayscalestructures:
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b.Fourelementsofwagedistortion.
Thefour(4)elementsofwagedistortionareasfollows:
(1) Anexistinghierarchyofpositionswithcorrespondingsalaryrates;
(2) Asignificantchangeinthesalaryrateofalowerpayclasswithoutaconcomitantincreaseinthesalaryrate
ofahigherone;
(3) Theeliminationofthedistinctionbetweenthetwolevels;and
(4) Theexistenceofthedistortioninthesameregionofthecountry.44
Normally,acompanyhasawagestructureormethodofdeterminingthewagesofitsemployees.Inaproblem
dealingwithwagedistortion,thebasicassumptionisthatthereexistsagroupingorclassificationofemployeesthat
establishesdistinctionsamongthemonsomerelevantorlegitimatebases.45
Involvedintheclassificationofemployeesarevariousfactorssuchasthedegreesofresponsibility,theskills
andknowledgerequired,thecomplexityofthejob,orotherlogicalbasisofdifferentiation.Thedifferingwageratefor
eachoftheexistingclassesofemployeesreflectsthisclassification.
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a.Wagedistortion,asdefinedinthelawandimplementingrules.
Asdefinedbylawandimplementingrules,wagedistortioncontemplatesasituationwhereanincreasein
prescribedwageratesresultsineitherofthefollowing:
1. Eliminationofthequantitativedifferencesintheratesofwagesorsalaries;or
2. Severe contraction of intentional quantitative differences in wage or salary rates between and among
employeegroupsinanestablishmentastoeffectivelyobliteratethedistinctionsembodiedinsuchwage
structurebasedonthefollowingcriteria:
a.skills;
b.lengthofservice;or
c.otherlogicalbasesofdifferentiation.42
Elaboratingonthisstatutorydefinition,theSupremeCourtruled:Wagedistortionpresupposesaclassification
ofpositionsandrankingofthesepositionsatvariouslevels.Onevisualizesahierarchyofpositionswithcorresponding
ranks basically in terms of wages and other emoluments. Where a significant change occurs at the lowest level of
positionsintermsofbasicwagewithoutacorrespondingchangeintheotherlevelinthehierarchyofpositions,negating
as a result thereof the distinction between one level of position from the next higher level, and resulting in a parity
betweenthelowestlevelandthenexthigherlevelorrank,betweennewentrantsandoldhires,thereexistsawage
distortion. xxx. The concept of wage distortion assumes an existing grouping or classification of employees which
establishesdistinctionsamongsuchemployeesonsomerelevantorlegitimatebasis.Thisclassificationisreflectedina
differingwagerateforeachoftheexistingclassesofemployees.43
15

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TheCBAmandatedwageincreasesaregrantedafterseriousbargainingnegotiationsbetweentheemployer
andtheemployeesthroughtheirdulyrecognizedorcertifiedbargainingagent.Thelegallymandatedwageincreases
andbenefitsareimposedbythegovernment,throughtheRegionalTripartiteWagesandProductivityBoards(RTWPBs)
withoutthebenefitofanybargainingnegotiationsalthoughpublichearingsareconductedpriortothepromulgationof
anywageordertheyissue.
Oncegranted,bothCBAmandatedandlegislatedwageincreasesandbenefitsshouldbefullycompliedwithby
theemployersunderpainofbeingpenalizedunderthelaw.
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Section 10. CREDITABLE WAGE INCREASE. Any increase granted by an employer in an organized
establishment within three (3) months prior to the effectivity of this Order shall be credited as compliance with the
prescribed increase set forth herein, provided that an agreement to this effect has been forged between the parties or a
collective bargaining agreement provision allowing creditability exists. In the absence of such an agreement or provision
in the CBA, any increase granted by the employer shall not be credited as compliance with the wage increase prescribed
in this Order. In unorganized establishments, any increase granted by the employer within five (5) months prior to the
effectivity of this Order shall be credited as compliance therewith. In case the increases given are less than the
prescribed Minimum Wage, the employer shall pay the difference. Such increases shall not include anniversary
increases, merit wage increases and those resulting from the regularization or promotion of employees.
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RuleIVoftheImplementingRulesofsaidWageOrderexpoundsthisfurtherinmoredetails,thus:
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RULE IV
CREDITABLE INCREASE
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Section 1. ORGANIZED ESTABLISHMENTS. Wage increases granted by an employer in an organized establishment

within three (3) months prior to the effectivity of the Order may be credited as compliance with the prescribed increase
set forth therein; Provided that an agreement to this effect has been forged between the parties or a provision in the
collective bargaining agreement allowing creditability exists. In the absence of such an agreement or provision in the
CBA, any increase granted by the employer shall not be credited as compliance with the increase prescribed in this
Order.
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Section 2. UNORGANIZED ESTABLISHMENTS. In unorganized establishments, wage increases granted by the

employer within five (5) months prior to the effectivity of the Order may be credited as compliance.
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Section 3. CREDITABLE INCREASES GIVEN IN THE FORM OF ALLOWANCES. Where the increase given by the
employer is in the form of allowances, the employer shall integrate the same into the basic wage of the workers to comply
with the P404.00 or P 367.00 per day minimum basic pay whichever is applicable, prescribed under the Order. However,
if the amount of the increase is greater than the increase granted under the Wage Order, the employer has the option to
integrate partially or in full the allowances earlier given. In the event of partial integration, any excess maybe retained as
allowances.
Section 4. CREDITABLE INCREASES GIVEN LESS THAN THE PRESCRIBED ADJUSTMENTS. In case the
increases given are less than the prescribed adjustments, the employer shall pay the difference. Such increases shall not
49
50
51
Marcopper Mining Corporation v. NLRC, G.R. No. 103525, March 29, 1996; Kimberly Clark Phils. v. Lorredo, G.R. No. 103090, Sept. 21, 1993, 226 SCRA 639; Plastic Town Center Corporation v. NLRC, G.R. No. 81176, April 19, 1989, 172 SCRA 580.
Filipinas Golf & Country Club, Inc. v. NLRC, G.R. No. 62918, Aug. 23, 1989.
Philippine Telegraph and Telephone Corporation v. NLRC, G.R. No. 99858, June 19, 1995, 245 SCRA 193; Liberty Flour Mills Employees v. Liberty Flour Mills, Inc., G.R. Nos. 58768-70, Dec. 29, 1989, 180 SCRA 668.
16
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d.WageOrdersissuedbyRTWPBs.
Wage Orders issued by the various Regional Tripartite Wages and Productivity Boards (RTWPBs)
throughoutthePhilippinesusually,althoughnotineverycase,containaprovisiononchargeability.
Forinstance,inWageOrderNo.NCR15[effectiveJuly01,2010],thefollowingprovisiononcreditability
orchargeabilityisfoundinitsSection10,towit:
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c.CreditabilityofCBAincreasestoWageOrderincreases.
Chargeability or creditability clause is a provision in the CBA or in the law or wage order allowing CBA
mandatedincreasestobechargedorcreditedascompliancewiththestatutorywageincreasesmandatedororderedby
laworwageorder.ThisisavalidprovisionintheCBAorinthelaworwageordermandatingwageincreases,provided
thatafterchargingorcreditingthereof,theamountofwagesoftheemployeesshallremainequivalenttooroverand
abovetheprevailingminimumwagesetbylaworwageorder.Wheretheincreasesarelessthantheapplicableamount
providedinthelaworwageorder,theemployerisrequiredtopaythedifference.51
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b.MaterialityoftheintentionofthepartiestotheCBA.
ACBA,justlikeanycontract,issubjecttointerpretationorconstructionifthereisambiguityinitsprovisionsor
stipulations.Ifnosuchambiguityexists,itsprovisionswhichmustbereadtogetherwithitsotherstipulationsandnotin
isolationfromoneanother,shouldbegiventheirliteralmeaning,followingthebasicrulesoflegalhermeneutics.
The purpose of applying the rules of legal hermeneutics is to ascertain the intention of the parties to the
agreement.Oncedetermined,suchintentionshouldbegivenfulleffectandforceasbetweenthem,itbeingunderstood
that such CBAis their law. Theprinciple that the CBA is the law between the contracting parties stands strongand
true.49
Hence,itiswellsettledthatifthepurposeofthepartiesinenteringintoastipulationonwageincreasesisto
grantthesameseparateanddistinctfromwhateverwageincreasesasmaybegrantedbylaworwageorder,thenthe
workersareentitled,nodoubt,toboththeCBAmandatedandlegallymandatedwageincreasesduringtheperiodwhen
bothincreasesareconcurrentlyeffective.Themanifestwillandintentofthepartiestotreatthelegislatedincreasesas
equivalentprotantotothosestipulatedintheirbargainingagreementmustberespectedandgiveneffect.50

include anniversary increases, merit wage increases, and those resulting from the regularization or promotion of
employees.
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e.Validityofchargeability/creditabilityclause.
ThevalidityofchargeabilityorcreditabilityclausehadlongbeenupheldbytheSupremeCourt.InearlierWage
Orderscontainingchargeabilityclauses,suchasWageOrdersNos.5[June11,1984]and6[October26,1984],itwas
ruled that such clause is grounded on public policy to encourage employers to grant wage and allowance increases
prescribedbythestatuteoradministrativeregulation.52
Moreover, accordingtoFilipinas Golf & Country Club,Inc. v. NLRC, [G.R. No.61918,August 23, 1989, 176
SCRA625],stipulationswhichsubordinatecontractualwageincreasestothoseimposedorprescribedbylawarenot
contrarytolaw,customs,publicorderorpublicpolicy.
InPhilippineTelegraphandTelephoneCorporationv.NLRC,[G.R.No.99858,June1995],theCBAprovisions
in question reveal quite sufficiently the parties' intention to consider salary increases provided in the CBA to be
creditabletowageincreasesthatareormaybemandatedwithintheapplicableperiodbylaw.Inholdingthatthereis
nothingsinisterinthiskindofstipulation,theHighCourtcitedthesaidcaseofFilipinasGolfandCountryClub,Inc.,vs.
NLRC, where it was stated that such agreements merely create an equivalence between legal and contractual
imperatives, rendering both obligations susceptible of performance by compliance with either, subject only to the
conditionthatwheretheincreasesgivenundertheagreementfallshortinamountofthosefixedbylaw,thedifference
mustbemadeupbytheemployer.
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a.PrincipleunderArticle100.
Article 100 of the Labor Code ordains two (2) principles, namely, [1] the nonelimination and (2) the non
diminutionofthesupplementsorotherbenefitsofemployeesbeingenjoyedbythematthetimeofthepromulgation
of the Labor Code on May 1, 1974. Therefore, the reduction or diminution or withdrawal by employers of any such
benefits, supplements or payments as provided in existing laws, individual agreements or collective bargaining
agreementsbetweenworkersandemployersorvoluntaryemployerpracticeorpolicy,isnotallowed.54
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b.Thenoneliminationornondiminutionprincipleappliedeventobenefitsgrantedafterthe
promulgation/effectivityoftheLaborCode.
AlbeitArticle100isclearthatthetwinprinciplesofnoneliminationandnondiminutionofbenefitsapplyonly
tothebenefitsbeingenjoyedatthetimeofthepromulgationoftheLaborCode,theSupremeCourt,however,has
consistentlycitedArticle100asbeingapplicableeventobenefitsgrantedaftersaidpromulgation.Ithas,infact,been
treatedasthelegalanchorforthedeclarationoftheinvalidityofsomanyactsofemployersdeemedtohaveeliminated
ordiminishedthebenefitsofemployees.
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c.Wheneliminationordiminutionofbenefitsconstitutesdemotion.
Theillegalandunjustifiedeliminationordiminutionofcertainbenefitsmayresultinillegaldemotion.Under
establishedjurisprudence,thereisdemotionwheretheactoftheemployerresultsintheloweringinpositionorrankor
reductioninsalaryoftheemployee.55
Itinvolvesasituationwhereanemployeeisrelegatedtoasubordinateorlessimportantpositionconstitutinga
reductiontoalowergradeorrankwithacorrespondingdecreaseindutiesandresponsibilitiesandusuallyaccompanied
byadecreaseinsalary.56
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b.Wheneliminationordiminutionofbenefitsconstitutesconstructivedismissal.
Elimination or diminution of certain benefits may result in the constructive dismissal of an employee.
Constructive dismissal is an involuntary resignation resorted to when continued employment is rendered impossible,
unreasonableorunlikely;whenthereisademotioninrankand/oradiminutioninpay;orwhenacleardiscrimination,
insensibilityordisdainbyanemployerbecomesunbearabletotheemployeethatitcouldforecloseanychoicebyhim
excepttoforegohiscontinuedemployment.57
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Apex Mining Co., Inc. v. NLRC, G.R. No. 86200, Feb. 25, 1992, 206 SCRA 497.
Lakas ng Manggagawang Makabayan [LMM] v. Abiera, G.R. No. L-29474, Dec. 19, 1970; Liberation Steamship Co., Inc. v. CIR, G.R. No. L-25389, June 27, 1968.
Republic Planters Bank, now known as PNB-Republic Bank, v. NLRC, G.R. No. 117460, Jan. 6, 1997; Davao Fruits Corporation v. Associated Labor Union, G.R. No. 85073, Aug. 24, 1993, 225 SCRA 567
55 Philippine Wireless, Inc. [Pocketbell] v. NLRC, G.R. No. 112963, July 20, 1999; Brillantes v. Guevarra, G.R. No. L-22586, Feb. 27, 1969, 27 SCRA 138; Fernando v. Sto. Tomas, G.R. No. 112309, July 28, 1994, 234 SCRA 546.
56 Tinio v. CA, G.R. No. 171764, June 8, 2007.
57 Unicorn Safety Glass, Inc. v. Basarte, G.R. No. 154689, Nov. 25, 2004; See also Uniwide Sales Warehouse Club v. NLRC, G.R. No. 154503, Feb. 29, 2008; Chiang Kai Shek College v. Hon. CA, G.R. No. 152988, Aug. 24, 2004.
52
53
54
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7.NONDIMINUTIONOFBENEFITS(ARTICLE100,LABORCODE).
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g.ProhibitiononCBAstipulationsbelowminimumlegalstandards.
The parties to a CBA are not allowed to stipulate below the minimum standards provided under the law.
EnteringintoaCBAwhichcontainstermsandconditionsofemploymentbelowminimumstandardsestablishedbylaw
willnotconstituteabartotheconductofacertificationelectiondespitetheregistrationoftheCBAwiththeDepartment
ofLaborandEmployment.
Previously, entering into a CBA providing benefits below the minimum standards set by law is one of the
groundsforcancellationofunionregistrationunderArticle239[f]oftheLaborCode.Thisground,however,hasbeen
deletedbytheamendatoryprovisionofRepublicActNo.9481,whichtookeffectonJune14,2007.
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f.LawispresumedpartoftheCBA.
Theprovisionsofexistinglawsformpartofavalidcontract.Thisisawellsettledrule.Thereisnoneedforthe
partiestomakeanyexpressreferencethereto.Thelawispresumedtobepartofthecontract.53
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8.WORKERSPREFERENCEINCASEOFBANKRUPTCY(ARTICLE110,LABORCODE).
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a.RuleunderArticle110.
Article110,58enunciatestheconceptofworkerpreferencetocovernotonlyunpaidwagesbutalsoother
monetaryclaimstowhichevenclaimsofthegovernmentmustbedeemedsubordinate.Thus,itisexplicitlyprovided
that(s)uchunpaidwagesandmonetaryclaimsshallbepaidinfullbeforeclaimsofthegovernmentandothercreditors
maybepaid.
Itsimplementingrule59states:
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Section10.PaymentofWagesandOtherMonetaryClaimsinCaseofBankruptcy.Incase
ofbankruptcyorliquidationoftheemployersbusiness,theunpaidwagesandothermonetaryclaims
of the employees shall be given first preference and shall be paid in full before the claims of
governmentandothercreditorsmaybepaid.[Underliningsupplied]
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c.Preferenceofmortgagecredit.
AmortgagecreditisaspecialpreferredcreditunderArticle2241oftheCivilCodewhileworkerspreferenceis
anordinarypreferredcredit.67
ThestatementinDevelopmentBankofthePhilippinesv.NLRC,[G.R.Nos.10026481,January29,1993,218
SCRA183],thatunderthenewArticle110oftheLaborCode,mortgagecreditsaresubordinatetoworkersclaimis
merelyanobiter.68
Thus,itisgraveabuseofdiscretiononthepartoftheLaborArbiterinrulingthattheemployeesmayenforce
theirfirstpreferenceinthesatisfactionoftheirclaimsoverthoseofthemortgagorintheabsenceofadeclarationof
bankruptcy or judicial liquidation of the employer. There is nothing that prevents the employees from instituting
involuntaryinsolvencyoranyotherappropriateproceedingagainsttheiremployerwheretheirclaimscanbeasserted
withrespecttotheiremployersassets.69
The2005caseofBarayogav.AssetPrivatizationTrust,[GRNo.160073,October24,2005],continuestoaffirm
the same principles enunciated in the cases mentioned earlier. In this case, Philippine National Bank (PNB) was a
mortgagecreditorofBicolandiaSugarDevelopmentCorp.(BISUDECO).TheclaimofPNBwaslatertransferredtothe
Asset Privatization Trust (APT) which was created to conserve, provisionally manage and dispose of nonperforming
assetsofthePhilippinegovernmentidentifiedforprivatizationordisposition.APTsubsequentlyacquiredownershipof
BISUDECOs assets following foreclosure proceedings. A complaint for underpayment of wages and other labor
standardsbenefitswasfiledbytheworkersofBISUDECO.APTlatersoldBISUDECOsassetstotheBicolAgroIndustrial
Cooperative(BAPCI).TheworkerssoughttoenforcetheirclaimagainstAPTandBAPCI.BoththeLaborArbiterandthe
NLRCruledinfavoroftheworkersfortheirunpaidbenefits.APT,havingbeenheldliabletherefor,raisedtheissueof
whether,asmortgageeoftheiremployersassets,itcanbeheldliablefortheworkersclaims.TheSupremeCourtruled
Pr
As amended by Section 1 of R.A. No. 6715 [March 21, 1989].

Particularly Section 10, Rule VIII, Book III of the Rules to Implement the Labor Code, as amended on May 24, 1989.
Some of the notable cases where this pronouncement was asserted are Bolinao, Jr. v. Padolina, [G.R. No. 81415, June 6, 1990, 186 SCRA 368]; DBP v. NLRC, [G.R. No. 86932, June 27, 1990, 186 SCRA 841]; DBP v. Minister of Labor, [G. R. No. 75801, March 20, 1991]; DBP v.
NLRC, [G.R. Nos. 100264-81, January 29, 1993]; DBP v. NLRC, [G.R. No. 86227, January 19, 1994, 229 SCRA 350]; Hautea v. NLRC, [G.R. No. 96149, February 16, 1994]; DBP v. NLRC, [G.R. No. 106655, September 1, 1994]; DBP v. NLRC, [G.R. No. 108031, March 01, 1995] and
Barayoga v. Asset Privatization Trust, [GR No. 160073, October 24, 2005].
61 The Manila Banking Corporation, v. NLRC, G.R. No. 107487, Sept. 29, 1997, 279 SCRA 602.
62 Commissioner of Internal Revenue v. NLRC, G.R. No. 74965, Nov. 9, 1994, 238 SCRA 42; DBP v. Secretary of Labor, G.R. No. 79351, Nov. 28, 1989.
63 DBP v. NLRC, G.R. No. 86227, Jan. 19, 1994, 229 SCRA 350.
64 DBP v. Secretary of Labor, G.R. No. 79351, Nov. 28, 1989 citing Philippine Savings Bank v. Lantin, G.R. No. L-33929, Sept. 2, 1983, 124 SCRA 476; DBP v. Hon. Labor Arbiter Ariel C. Santos G.R. Nos. 78261-62, March 8, 1989.
65 DBP v. NLRC, G.R. No. 108031, March 1, 1995, 242 SCRA 59.
66 See also Republic v. Enriquez, G.R. No. L-78391, Oct. 21, 1988, 166 SCRA 608.
67 Hautea v. NLRC, G.R. No. 96149, Feb. 16, 1994, 230 SCRA 119; DBP v. NLRC, G.R. Nos. 82763-64, June 27, 1990, 183 SCRA 328.
68 Hautea v. NLRC, G.R. No. 96149, Feb. 16, 1994, 230 SCRA 119.
69 DBP v. Secretary of Labor, G.R. No. 79351, Nov. 28, 1989
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60
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b.Preferenceoftaxesandclaimsofgovernment.
Bywayofunderscoringthispointonpreferenceoftaxes,worthreiteratingistherulinginCommissionerof
InternalRevenuev.NLRC,[G.R.No.74965,November9,1994,238SCRA42],thatthereisnomeritinthecontention
thattaxesareabsolutelypreferredclaimsonlywithrespecttomovableandimmovablepropertiesonwhichtheyare
due.Theclaimofthegovernmentpredicatedonataxlienissuperiortotheclaimofaprivatelitigantpredicatedona
judgment.Thetaxlienattachesnotonlyfromtheserviceofthewarrantofdistraintofpersonalpropertybutfromthe
timethetaxbecamedueandpayable.66
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Despitetheclearletterofthelawanditsimplementingrule,theSupremeCourtconsistentlyheldinaplethora
ofcasesthattherighttopreferencegiventoworkersunderArticle110cannotexistinanyeffectivewaypriortothe
timeofitspresentationindistributionproceedings.Inotherwords,thereshouldfirstbeadeclarationofbankruptcyor
judicialliquidation.60
Itisbeyonddisputethatemployeesindeedenjoyfirstpreferenceintheeventofbankruptcyorliquidationof
anemployersbusiness.61 ButArticle110 applies only incase ofbankruptcy or judicial liquidationoftheemployer.62
Judicialproceedingsinremisrequiredforcreditorsclaimsagainstdebtorstobecomeoperative.63
Inthisjurisdiction,bankruptcy,insolvencyandgeneraljudicialliquidationproceedingsprovidetheonlyproper
venuefortheenforcementofacreditor'spreferentialrightsuchasthatestablishedinArticle110oftheLaborCode,for
theseareinremproceedingsbindingagainstthewholeworldwhereallpersonshavinganyinterestintheassetsofthe
debtoraregiventheopportunitytoestablishtheirrespectivecredits.64
TocontendthatArticle110oftheLaborCodeisapplicablealsotoextrajudicialproceedingswouldbeputting
the worker in a better position than the State which could only assert its own prior preference in case of a judicial
proceeding.65
18

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that the mortgageetransferee of its debtors assets does not automatically acquire the liabilities of the debtor
mortgagor,suchastheworkersclaimsforbenefits.Hence,APTasmortgageeofBISUDECO,cannotbeheldliableforthe
monetaryclaimsofthelattersworkers.CitingDBPv.NLRC,[G.R.Nos.8276364,March19,1990,183SCRA328],it
further held thatthe workers preferenceofcredit isnota lienthat attaches to specific propertiesoftheir insolvent
employer.Amortgageeslien,ontheotherhand,createsachargeonthedebtorcompanysparticularpropertyand,
hence,shouldprevailovertheworkerspreferenceofcredit.TheSupremeCourtreiteratedtherulethatthebenefitof
Article 110 cannot be invoked outside bankruptcy or judicial proceedings where the claims of all creditors may be
inventoriedanddetermined.
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d.MeaningofwagesinArticle110.
The term wages under Article 110 of the Labor Code may be regarded as embracing within its scope,
severancepayorterminationorseparationpay.70
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9.LABORCODEPROVISIONFORWAGEPROTECTION(ARTICLES112TO119,LABORCODE).
ThefollowingprovisionsoftheLaborCodearemeanttoprotectwage:
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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 make
use of any store or services of such employer or any other person.
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ART. 116. Withholding of wages and kickbacks prohibited. - It shall be unlawful for any person, directly or
indirectly, to withhold any amount from the wages of a worker or induce him to give up any part of his wages by
force, stealth, intimidation, threat or by any other means whatsoever without the workers consent.
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ART. 115. Limitations. - 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.
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ART. 114. Deposits for loss or damage. - No employer shall require his worker to make deposits from which
deductions shall be made for the reimbursement of loss of or damage to tools, materials, or equipment supplied
by the employer, except when the employer is engaged in such trades, occupations or business where the
practice of making deductions or requiring deposits is a recognized one, or is necessary or desirable as
determined by the Secretary of Labor and Employment in appropriate rules and regulations.
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ART. 113. Wage deduction. - No employer, in his own behalf or in behalf of any person, shall make any
deduction from the wages of his employees, except:
(a) In cases where the worker 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 insurance;
(b) For union dues, in cases where the right of the worker or his union to check-off has been recognized by the
employer or authorized in writing by the individual worker concerned; and
(c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor and
Employment.
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ART. 117. Deduction to ensure employment. - It shall be unlawful to make any deduction from the wages of any
employee for the benefit of the employer or his representative or intermediary as consideration of a promise of
employment or retention in employment.
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ART. 118. Retaliatory measures. - It 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.
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kept pursuant to the provisions of this Code knowing such statement, report or record to be false in any material
respect.
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Alltheforegoingprovisionsareconsideredprohibitionsregardingwages.
10.ALLOWABLEDEDUCTIONSWITHOUTEMPLOYEESCONSENT(ARTICLE113,LABORCODE).
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a.Generalrule.
Thegeneralruleisthatanemployer,byhimselforthroughhisrepresentative,isprohibitedfrommakingany
deductionsfromthewagesofhisemployees.Theemployerisnotallowedtomakeunnecessarydeductionswithoutthe
knowledgeorauthorizationoftheemployees.71
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b.DeductionsallowedunderArticle113.
Article113allowsonlythree(3)kindsofdeductions,namely:
(a)Incaseswheretheworkerisinsuredwithhisconsentbytheemployer,andthedeductionisto
recompensetheemployerfortheamountpaidbyhimaspremiumontheinsurance;
(b) For union dues, in cases where the right of the worker or his union to checkoff has been
recognizedbytheemployerorauthorizedinwritingbytheindividualworkerconcerned;and
(c)IncaseswheretheemployerisauthorizedbylaworregulationsissuedbytheSecretaryofLabor
andEmployment.
70
71
Republic v. Peralta, G.R. No. 56568, May 20, 1987, 150 SCRA 37, 51.
Galvadores v. Trajano, G.R. No. L-70067, Sept. 15, 1986, 144 SCRA 138.
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aNonlawyersarenotentitledtoattorneysfees.
Albeitthelawallows,undercertaincircumstances,nonlawyerstoappearbeforetheLaborArbiter,National
LaborRelationsCommissionorotherlabortribunals,thisdoesnotmean,however,thattheyareentitledtoattorneys
fees.Theiractofrepresenting,appearingordefendingapartylitigantinalaborcasedoesnot,byitself,conferupon
themanylegalrighttoclaimforattorneysfees.Entitlementtoattorneysfeespresupposestheexistenceofattorney
clientrelationship.Thisrelationshipcannotexistunlesstheclientsrepresentativeisalawyer.82
b.Attorneysfeescannotbesharedwithnonlawyers.
AsheldinthecaseofAmalgamatedLaborersAssociationv.CIR,[G.R.No.L23467,March27,1968,22SCRA
1266], it is an immoral act for a lawyer to enter into an agreement whereby the union president will share in his
attorneysfees.Canon34ofLegalEthicsproscribesandcondemnsthisarrangement.Itprovidesthatnodivisionoffees
forlegalservicesisproperexceptwithanotherlawyerbaseduponadivisionofserviceorresponsibility.Sincetheunion
presidentisnotthelawyerfortheworkers,hecannotbeallowedtoshareintheattorneysfees.
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a.Entitlementtounionservicefees.
There are certain cases where it is not a lawyer who represents the interest of the employees. Labor
federationsandlocalunionsareallowedinourjurisdictiontoappearascounselsinlaborproceedings.Theirappearance
hasbeengivensanctionunderArticle222oftheLaborCodewhichallowsnonlawyerstorepresenttheirorganizationor
anymemberthereof.83
ThebestillustrativecaseonthispointisRadioCommunicationsofthePhils.,Inc.v.SecretaryofLaborand
Employment,[G.R.No.77959,January9,1989,169SCRA38].Inthiscase,petitionercontinuouslywithheldpaymentof
theECOLAmandatedunderWageOrderNo.1.Forthisreason,theemployeeswereforcedtoavailoftheservicesof
Article 248 [e], Labor Code.

Radio Communications of the Phils., Inc. v. Secretary of Labor and Employment, G.R. No. 77959, Jan. 9, 1989, 169 SCRA 38.
Section 13, Rule VIII, Book III, Rules to Implement the Labor Code.
75 Section 7, Rule VI, Book III, Rules to Implement the Labor Code.
76 Article 1706, Civil Code
77 Article 1708, Civil Code.
78 Article 59, R.A. No. 6938.
79 Special Steel Products, Inc. v. Villareal, [G.R. No. 143304, July 8, 2004].
80 Pondoc v. NLRC, G.R. No. 116347, Oct. 03, 1996.
81 Agabon v. NLRC, [G.R. No. 158693, November 17, 2004].
82 Five J. Taxi, v. NLRC, G.R. No. 111474, Aug. 22, 1994, 235 SCRA 556; Philippine Association of Free Labor Unions [PAFLU] v. Binalbagan Isabela Sugar Co., G.R. No. L-23959, Nov. 29, 1971, 42 SCRA 302.
83 RCPI v. Secretary of Labor and Employment, infra.
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11.ATTORNEYSFEESANDUNIONSERVICEFEEINLABORCASES(ARTICLE111,LABORCODE).
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d.Someprinciplesondeductionsfromemployeessalaryorwage.
1. Debtduetotheemployermaybesetoffagainsttheemployeeswagesandbenefits.79.
2. To validly setoff debt, the employees debt should arise from, or be connected with, the employment
relationship.Evidenceshouldbepresentedbytheemployertoprovethattheindebtednessaroseoutofor
wasincurredinconnectionwiththeiremploymentrelationship.Moreover,thesetoffshouldbeasserted
duringtheproceedingsbeforetheLaborArbiterandnotafterthecasehadbeenresolvedwithfinality.80
3. Deductionsduetotardinessorabsencesarevalid.
4. 13thmonthpayisconsideredpartofwageswithinthemeaningandcontemplationofArticle97[f]ofthe
LaborCode.Nodeduction,therefore,canbemadetherefromwithouttheknowledgeandconsentofthe
employeeconcerned.Thus,thedeductionofSSSloanandthevalueofshoesfromthe13thmonthpayof
theemployeeisnotallowed.81
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c.DeductionsallowedunderotherprovisionsoftheLaborCodeandotherlaws.
Deductionsfromthewagesofemployeesmaybemadebytheemployerinanyofthefollowingcases:
1. DeductionsforlossordamageunderArticle114oftheLaborCode;
2. Deductions made for agency fee from nonunion members who accept the benefits under the CBA
negotiated by the recognized or certified bargaining union. This form of deduction does not require the
writtenauthorizationofthenonunionmemberconcerned;72
3. Unionservicefee;73
4. Whenthedeductionsarewiththewrittenauthorizationoftheemployeeforpaymenttoathirdpersonand
theemployeragreestodoso,providedthatthelatterdoesnotreceiveanypecuniarybenefit,directlyor
indirectly,fromthetransaction;74
5. Deductionsforvalueofmealandotherfacilities;75
6. DeductionsforpremiumsforSSS,PhilHealth,employeescompensationandPagIBIG;
7.WithholdingtaxmandatedundertheNationalInternalRevenueCode(NIRC);
8.Withholdingofwagesbecauseoftheemployeesdebttotheemployerwhichisalreadydue;76.
9. Deductionsmadepursuanttoacourtjudgmentagainsttheworkerundercircumstanceswherethewages
maybethesubjectofattachmentorexecutionbutonlyfordebtsincurredforfood,clothing,shelterand
medicalattendance;77
10.Whendeductionsfromwagesareorderedbythecourt;
11.Salarydeductionsofamemberofalegallyestablishedcooperative.78
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theiruniontheUnitedRCPICommunicationsLaborAssociation(URCPICLA)FederationofUnionsofRizal(FUR)in
ordertosecurethebenefit.URCPICLAFURlitigatedthecaseuptotheSupremeCourt.Inthemeantime,petitionerRCPI,
withouttheknowledgeandconsentofprivaterespondentURCPICLAFUR,enteredintoacompromiseagreementwith
BuklodngManggagawasaRCPINFL(BMRCPINFL),thenewbargainingagentoftheRCPIemployees.Petitionerthen
implemented the terms of the compromise agreement without paying the 10% union service fee due private
respondentURCPICLAFUR.
Onthesoleissueofwhetherthepublicrespondentsactedwithgraveabuseofdiscretionamountingtolackof
jurisdiction in holding petitioner RCPI solely liable for "union service fee" to respondent URCPICLAFUR, the Supreme
Courtruledinthenegative.Theunionisentitledtounionservicefeesconsideringthatitwascategoricallyfoundbythe
LaborSecretarytohavebeenresponsibleforthesuccessfulprosecutionofthecasetoitsultimateconclusioninbehalfof
itsmembers,employeesofpetitioner.Theunionsrighttofeesforservicesrendered,orwhatittermedas"unionservice
fee,"is,therefore,indubitable.
In the 2009 case of Dealco Farms, Inc. v. NLRC, [G.R. No. 153192, January 30, 2009], the Supreme Court
affirmedtheunionservicefeesof10%ofthetotalmonetaryawardearliergrantedbytheLaborArbiterandtheNLRCas
itwasbasedonthefindingthatrespondentsweredismissedwithoutjustorauthorizedcause.
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c.Standards/Criteriaforminimumwagefixing.
TheminimumwageratestobeestablishedbytheBoardshallbeasnearlyadequateasiseconomicallyfeasible
tomaintaintheminimumstandardsoflivingnecessaryforthehealth,efficiencyandgeneralwellbeingoftheworkers
withintheframeworkofnationaleconomicandsocialdevelopmentgoals.Inthedeterminationofregionalminimum
wages,theBoardshall,amongotherrelevantfactors,considerthefollowing:
(a) Needsofworkersandtheirfamilies
1) Demandforlivingwages
2) Wageadjustmentvisvistheconsumerpriceindex
3) Costoflivingandchangestherein
4) Needsofworkersandtheirfamilies
5) Improvementsinstandardsofliving
(b) Capacitytopay
1) Fairreturnoncapitalinvestedandcapacitytopayofemployers
2) Productivity
(c) Comparablewagesandincomes
1) Prevailingwagelevels
(d) Requirementsofeconomicandsocialdevelopment
1) Needtoinduceindustriestoinvestinthecountryside
2) Effectsonemploymentgenerationandfamilyincome
3) Equitable distribution of income and wealth along the imperatives of economic and social
development.(Section2,RuleII,Ibid.).
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C. LABOR STANDARDS
3. Rest Day
a. Right to weekly rest day
b. Preference of the employee
c. When work on rest day authorized
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a.LatestNWPCGuidelinesNo.01,Seriesof2007.
NWPC Guidelines No. 01, Series of 2007 was issued by the NWPC on June 19, 2007, promulgating the
AmendedRulesofProcedureonMinimumWageFixinggoverningtheproceedingsintheCommissionandtheRTWPBs
inthefixingofminimumwageratesbyregion,provinceorindustry.
Byvirtueofthislatestissuance,thepreviousNWPCGuidelinesNo.00195andtheJune4,1990Rulesarenow
deemedrepealedpursuanttoSection1,RuleXIIthereofwhichdeclaresthat(a)llexistingrules,regulationsorordersor
anypartthereofinconsistentwiththisAmendedRulesarehereby,repealed,amendedormodifiedaccordingly.
b.Conductofwageandproductivitystudies.
The Board (RTWPB) shall, subject to the guidelines issued by the Commission (NWPC), conduct continuing
studiesofwagerates,productivityandotherconditionsintheregion,provincesorindustriestherein.TheBoardshall
investigate and study all pertinent facts, and based on standards and criteria (see below) shall determine whether a
wageordershouldbeissued.84
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1.RIGHTTOWEEKLYRESTDAY(ARTICLE91,LABORCODE).
a.Coverage.
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12.CRITERIA/FACTORSFORWAGESETTING(ARTICLE124,LABORCODE).
Section 1, Rule II, NWPC Guidelines No. 01, Series of 2007, June 19, 2007 [Amended Rules of Procedure on Minimum Wage Fixing].
21

The rule on weekly rest period is applicable to all employers, whether operating for profit or not, including
publicutilitiesoperatedbyprivatepersons.85
b.Weeklyrestperiod.
Everyemployerisrequiredtogivehisemployeesarestperiodofnotlessthantwentyfour(24)consecutive
hoursaftereverysix(6)consecutivenormalworkdays.86
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2.PREFERENCEOFTHEEMPLOYEE(ARTICLE91,LABORCODE).
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C. LABOR STANDARDS
4. Holidays
a. Right to holiday pay
(1) In case of absences
(2) In case of temporary cessation of work
(3) Of teachers, piece workers, seafarers,
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b.Compulsoryworkonscheduledrestday.
An employer may require any of his employees to work on his scheduled rest day for the duration of the
followingemergencyandexceptionalconditions:
a.Incaseofactualorimpendingemergenciescausedbyseriousaccident,fire,flood,typhoon,earthquake,
epidemicorotherdisasterorcalamity,topreventlossoflifeandproperty,orincaseofforcemajeureor
imminentdangertopublicsafety;
b.Incaseofurgentworktobeperformedonmachineries,equipment,orinstallations,toavoidseriousloss
whichtheemployerwouldotherwisesuffer;
c.In the event of abnormal pressure of work due to special circumstances, where the employer cannot
ordinarilybeexpectedtoresorttoothermeasures;
d.Topreventseriouslossofperishablegoods;
e.Wherethenatureoftheworkissuchthattheemployeeshavetoworkcontinuouslyforseven(7)daysina
weekormore,asinthecaseofthecrewmembersofavesseltocompleteavoyageandinothersimilar
cases;and
f. Whentheworkisnecessarytoavailoffavorableweatherorenvironmentalconditionswhereperformance
orqualityofworkisdependentthereon.92
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No employee shall be required against his will to work on his scheduled rest day except under the
circumstancesprovidedunderArticle92oftheLaborCodewhereworkonsuchdaymaybecompelled.However,incase
workonrestdayisrequiredandnotoneofthesaidcircumstancesispresent,theemployeemayworkduringsuchrest
daybut only on voluntarybasis.Andonce an employee volunteersto work on his restday, he should express such
willingnessanddesiretoworkinwriting.Accordingly,heshouldbepaidtheadditionalcompensationforworkingonhis
restdayunderthelaw.91
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3.WHENWORKONRESTDAYAUTHORIZED(ARTICLE92,LABORCODE).
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a.Employeespreferenceofrestdaybasedonreligiousgrounds.
ByexpressprovisionofArticle91oftheLaborCode,theexercisebytheemployerofsuchrightandprerogative
issubjecttothepreferenceinthechoicebytheemployeeofhisrestdaybasedonreligiousgrounds.Article91,infact,
makestheemployerdutyboundtorespectsuchpreferenceoftheemployeeifbasedonreligiousgrounds.
Theemployeeshouldmakeknownhispreferencetotheemployerinwritingatleastseven(7)daysbeforethe
desiredeffectivityoftheinitialrestdaysopreferred.89
Where,however,thechoiceoftheemployeesastotheirrestdaybasedonreligiousgroundswillinevitably
resultinseriousprejudiceorobstructiontotheoperationsoftheundertakingandtheemployercannotnormallybe
expectedtoresorttootherremedialmeasures,theemployermaysoscheduletheweeklyrestdayoftheirchoiceforat
leasttwo(2)daysinamonth.90
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c.Scheduleofrestday.
Wheretheweeklyrestisgiventoallemployeessimultaneously,theemployershouldmakeknownsuchrest
periodbymeansofawrittennoticepostedconspicuouslyintheworkplaceatleastone(1)weekbeforeitbecomes
effective.87
Wheretherestperiodisnotgrantedtoallemployeessimultaneouslyandcollectively,theemployershallmake
knowntotheemployeestheirrespectiveschedulesofweeklyrestdaythroughwrittennoticespostedconspicuouslyin
theworkplaceatleastone(1)weekbeforetheybecomeeffective.88
Section 1, Rule III, Book III, Rules to Implement the Labor Code.
Section 3, Rule III, Book III, Ibid..
Section 5 [a], Rule III, Book III, Ibid..
Section 5 [b], Rule III, Book III, Ibid..
89 Section 4, Rule III, Book III, Ibid..
90 Section 4, Rule III, Book III, Ibid..
91 Under Section 6, Rule III, Book III of the Rules to Implement the Labor Code.
92 See Section 6, Rule III, Book III, Rules to Implement the Labor Code.
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seasonal workers, etc.

b. Exclusions from coverage
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1.RIGHTTOHOLIDAYPAYINCASEOFABSENCES(ARTICLE94,LABORCODE).
a.Effectofabsencesonentitlementtoholidaypay.
1. Employeesonleaveofabsencewithpayentitledtoholidaypaywhentheyareonleaveofabsencewith
pay.93
2. Employeesonleaveofabsencewithoutpayonthedayimmediatelyprecedingtheregularholiday
maynotbepaidtherequiredholidaypayifhehasnotworkedonsuchregularholiday.94
3. Employees onleave while on SSSor employeescompensationbenefits Employers shouldgrantthe
same percentage of the holiday pay as the benefit granted by competent authority in the form of
employeescompensationorsocialsecuritypayment,whicheverishigher,ifheisnotreportingforwork
whileonsuchbenefits.95
4. Whendayprecedingregularholidayisanonworkingdayorscheduledrestdayshouldnotbedeemed
tobeonleaveofabsenceonthatday,inwhichcase,heisentitledtotheregularholidaypayifheworked
onthedayimmediatelyprecedingthenonworkingdayorrestday.96
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2.RIGHTTOHOLIDAYPAYINCASEOFTEMPORARYCESSATIONOFWORK.
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ONRIGHTTOHOLIDAYPAYOFPIECEWORKERS.
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b.Workerspaidbyresultsclassifiedintosupervisedandunsupervised.
Theprincipaltesttodetermineentitlementtoholidaypayiswhethertheemployeestimeandperformanceof
theworkaresupervisedorunsupervisedbytheiremployer.Ifsupervised,theemployeeisentitledtoholidaypay.If
unsupervised,heisnot.102
Thedistinctionsbetweensupervisedandunsupervisedworkerspaidbyresultsareasfollows:
(1) Thosewhosetimeandperformancearesupervisedbytheemployer.Here,thereisanelementofcontrol
andsupervisionoverthemannerastohowtheworkistobeperformed.Apiecerateworkerbelongsto
thiscategoryespeciallyifheperformshisworkinthecompanypremises;and
(2) Thosewhosetimeandperformanceareunsupervised.Here,theemployerscontrolisovertheresultof
thework.Workersonpakyaoandtakaybasisbelongtothisgroup.Bothclassesofworkersarepaidper
unitaccomplished.Pieceratepaymentisgenerallypracticedingarmentfactorieswhereworkisdonein
Section 6 [a], Rule IV, Book III, Rules to Implement the Labor Code; No. II [E], DOLE Handbook on Workers Statutory Monetary Benefits.
Section 6 [a], Rule IV, Book III, Ibid.; No. II [E], Ibid.
Section 6 [b], Rule IV, Book III, Ibid.; No. II [E], Ibid..
96 Section 6 [c], Rule IV, Book III, Ibid.; No. II [E], Ibid..
97 Section 7 [a], Rule IV, Book III, Ibid.; No. II [F], Ibid..
98 Section 7 [b], Rule IV, Book III, Ibid..
99 Section 8 [a], Rule IV, Book III, Ibid.; No. II [G], Ibid..
100 Jose Rizal College v. NLRC, [G.R. No. 65482, December 1, 1987].
101 Section 8 [b], Rule IV, Book III, Rules to Implement the Labor Code; No. II [G], DOLE Handbook on Workers Statutory Monetary Benefits.
102 Labor Congress of the Philippines v. NLRC, [G.R. No. 123938, May 21, 1998, 290 SCRA 509]; Tan v. Lagrama, [G.R. No. 151228, August 15, 2002].
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a.Holidaypayofpieceworkersoremployeespaidbyresults.
Whereacoveredemployeeispaidbyresultsoroutputsuchaspaymentonpiecework,hisholidaypayshould
notbelessthanhisaveragedailyearningsforthelastseven(7)actualworkingdaysprecedingtheregularholiday.Inno
case,however,shouldtheholidaypaybelessthantheapplicablestatutoryminimumwagerate.101
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1. Privateschoolteachers,ingeneral.Privateschoolteachers,includingfacultymembersofcollegesand
universities,maynotbepaidfortheregularholidaysduringsemestralvacations.Theyshall,however,be
paidfortheregularholidaysduringChristmasvacation.99
2.Holidaypayofhourlypaidteachers. Aschoolisexemptedfrompayinghourlypaidfacultymembers
theirpayforregularholidays,whetherthesamebeduringtheregularsemestersoftheschoolyearor
duringsemestral,Christmas,orHolyWeekvacations.However,itisliabletopaythefacultymembers
theirregularhourlyrateondaysdeclaredasspecialholidaysorif,forsomereason,classesarecalledoff
or shortened for the hours they are supposed to have taught, whether extensions of class days be
orderedornot;andincaseofextensions,saidfacultymembersshalllikewisebepaidtheirhourlyrates
shouldtheyteachduringsaidextensions,100
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b.Temporarycessationofoperationduetobusinesslossesorreverses.
The regular holiday during the temporary cessation of operation of an enterprise due to business losses or
financialreversesasauthorizedbytheSecretaryofLaborandEmploymentmaynotbepaidbytheemployer.98
3.RIGHTTOHOLIDAYPAYOFTEACHERS,PIECEWORKERS,SEAFARERS,SEASONALWORKERS,ETC.
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a.Temporaryorperiodicshutdownorcessationofworknotduetobusinessreverses.
Incasesoftemporaryorperiodicshutdownandtemporarycessationofworkofanestablishment,aswhena
yearlyinventoryorwhentherepairorcleaningofmachineriesandequipmentisundertaken,theregularholidaysfalling
within the period should be compensated in accordance with Rule IV [Holidays With Pay], Book III of the Rules to
ImplementtheLaborCode.97
94
95
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the company premises, while payment on pakyao and takay basis is commonly observed in the
agricultural industry, such as in sugar plantations where the work is performed in bulk or in volumes
difficulttoquantify.Petitionersbelongtothefirstcategory,i.e.,supervisedemployees.103
ONRIGHTTOHOLIDAYPAYOFSEAFARERS.
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UndertheStandardTermsandConditionsGoverningtheEmploymentofFilipinoSeafarersonBoardOcean
GoingVessels,itisprovidedthat(a)nyhoursofworkordutyincludinghoursofwatchkeepingperformedbythe
seafarerondesignatedrestdaysandholidaysshallbepaidrestdayorholidaypay.
ONRIGHTTOHOLIDAYPAYOFSEASONALWORKERS.
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C. LABOR STANDARDS
5. Leaves
a. Service Incentive Leave Pay
(1) Right to service incentive leave
(2) Exclusions from coverage
(3) Commutable nature of benefit
b. Maternity Leave
(1) Coverage
(3) Availment
c. Paternity Leave
(1) Coverage
(3) Availment
d. Parental Leave
(1) Coverage
(3) Availment
e. Leaves for victims of violence
against women
(1) Coverage
(3) Availment
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a.Coverage;exceptions.
Generally, all employees are entitled to covered by Article 94 of the Labor Code, as amended, and its
implementingrules,except:
a.Thoseofthegovernmentandanyofthepoliticalsubdivisions,includinggovernmentownedandcontrolled
corporations;
b.Thoseofretailandserviceestablishmentsregularlyemployinglessthanten(10)workers;
c.Domestichelpers;
d.Personsinthepersonalserviceofanother;
e.ManagerialemployeesasdefinedinBookIIIoftheLaborCode;
f.Fieldpersonnelandotheremployeeswhosetimeandperformanceisunsupervisedbytheemployer;
g.Thosewhoareengagedontaskorcontractbasisorpurelycommissionbasis;
h. Those who are paid a fixed amount for performing work irrespective of the time consumed in the
performancethereof;
i.Otherofficersandmembersofthemanagerialstaff;
j. Membersofthefamilyoftheemployerwhoaredependentonhimforsupport.105
103
104
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Seasonal workers are entitled to holiday pay while working during the season. They may not be paid the
requiredregularholidaypayduringoffseasonwheretheyarenotatwork.104
Lambo v. NLRC, [G.R. No. 111042, October 26, 1999, 317 SCRA 420].
Section 8 [c], Rule IV, Book III, Rules to Implement the Labor Code; No. II [G], DOLE Handbook on Workers Statutory Monetary Benefits.
Article 82, Labor Code; See also Section 1, Rule IV, Book III, Rules to Implement the Labor Code; No. II [A], DOLE Handbook on Workers Statutory Monetary Benefits.
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Every covered employee who has rendered at least one (1) year of service is entitled to a yearly service
incentiveleaveoffive(5)dayswithpay.106Thetermatleastoneyearofserviceshouldmeanservicewithintwelve
(12) months, whether continuous or broken, reckoned from the date the employee started working, including
authorizedabsencesandpaidregularholidays,unlessthenumberofworkingdaysintheestablishmentasamatterof
practice or policy, or that provided in the employment contract, is less than twelve(12) months, in whichcase, said
periodshouldbeconsideredasone(1)yearforthepurposeofdeterminingentitlementtotheserviceincentiveleave
benefit.107
b.Exclusionsfromcoverage.
Allemployeesarecoveredbytheruleonserviceincentiveleaveexcept:
a. Thoseofthegovernmentandanyofitspoliticalsubdivisions,includinggovernmentownedandcontrolled
corporations;
b. Domestichelpers;
c. Personsinthepersonalserviceofanother;
d. ManagerialemployeesasdefinedinBookIIIoftheLaborCode;
e. Fieldpersonnelandotheremployeeswhoseperformanceisunsupervisedbytheemployer;
f. Thosewhoareengagedontaskorcontractbasis,purelycommissionbasis,orthosewhoarepaidinafixed
amountforperformingworkirrespectiveofthetimeconsumedintheperformancethereof;
g. Thosewhoarealreadyenjoyingthebenefitprovidedinthelaw;
h. Thoseenjoyingvacationleavewithpayofatleastfive(5)days;
i. Thoseemployedinestablishmentsregularlyemployinglessthanten(10)employees;
j. Otherofficersandmembersofthemanagerialstaff;and
k. Membersofthefamilyoftheemployerwhoaredependentonhimforsupport.108
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SILearnedasofDecember31,2010
Five(5)days
ProportionateSILforJan.andFeb.
2011(2/12x5days)
0.833day
TotalaccruedSILasofMarch1,2011
5.833days112
2.MATERNITYLEAVE.
(ARTICLE133,LABORCODE;SECTION14A,SOCIALSECURITYLAW[R.A.NO.8282).
a.Coverage.
Maternityleaveistheperiodoftimewhichmaybeavailedofbyawomanemployee,marriedorunmarried,
toundergoandrecuperatefromchildbirth,miscarriageorcompleteabortionduringwhichsheispermittedtoretainher
rightsandbenefitsflowingfromheremployment.
Section14A113oftheSocialSecurityLawnowprovidesasfollows:
Sec.14A.MaternityLeaveBenefit.Afemalememberwhohaspaidatleastthree(3)
monthly contributions in the twelvemonth period immediately preceding the semester of her
childbirthormiscarriageshallbepaidadailymaternitybenefitequivalenttoonehundredpercent
(100%)ofheraveragedailysalarycreditforsixty(60)daysorseventyeight(78)daysincaseof
caesariandelivery,subjecttothefollowingconditions:
(a) That the employee shall have notified her employer of her pregnancy and the
probable date of her childbirth, which notice shall be transmitted to the SSS in
accordancewiththerulesandregulationsitmayprovide;
(b) Thefullpaymentshallbeadvancedbytheemployerwithinthirty(30)daysfrom
thefilingofthematernityleaveapplication;
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c.Commutablenatureofbenefit.
Theserviceincentiveleaveiscommutabletoitsmoneyequivalentifnotusedorexhaustedattheendofthe
year.109Thephraseleavewithpaymeansthattheemployeeisentitledtohisfullcompensationduringhisleaveof
absencefromwork.110
Incomputingtheserviceincentiveleavebenefit,thebasisisthesalaryrateatthedateofcommutation.The
availmentandcommutationoftheserviceincentiveleavebenefitmaybeonaproratabasis.111
Illustration.
Toillustratethecomputationoftheserviceincentiveleave(SIL)cashcommutation,anemployeewhoishired
onJanuary1,2010andresignedonMarch1,2011,assuminghehasnotusedorcommutedanyofhisaccruedSIL,is
entitleduponhisresignationtothecommutationofhisaccruedSILasfollows:
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Article 95 [a], Labor Code; Section 2, Rule V, Book III, Rules to Implement the Labor Code.
Section 3, Rule V, Book III, Rules to Implement the Labor Code; No. VI [B], DOLE Handbook on Workers Statutory Monetary Benefits; Integrated Contractor and Plumbing Works, Inc. v. NLRC, G.R. No. 152427, August 9, 2005.
Article 82, Labor Code; Section 1, Rule V, Book III, Rules to Implement the Labor Code; No. VI [A], DOLE Handbook on Workers Statutory Monetary Benefits.
Section 5, Rule V, Book III, Ibid.; No. VI [C], Ibid..
110 Escosura v. San Miguel Brewery, Inc., G.R. No. L-16696; Jan. 31, 1962.
111 No. VI [C], DOLE Handbook on Workers Statutory Monetary Benefits.
112 See No. VI [A], DOLE Handbook on Workers Statutory Monetary Benefits based on the opinion of DOLE Legal Service.
113 As amended by R.A. No. 7322 as well as the Social Security Act of 1997 [R.A. No. 8282].
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107
108
109
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b.Conditionstoentitlement.
Thefollowingarethequalificationsforentitlementtomaternitybenefits:
1. Thefemalemembershouldbeemployedatthetimeofdelivery,miscarriageorabortion.
2.ShemusthavegiventherequirednotificationtotheSSSthruheremployer.
3. Her employer must have paid at least three (3) months of maternity contributions within the 12month
periodimmediatelybeforethesemesterofcontingency.114
c.Availment.
1.Pregnantwomen,whethermarriedorunmarried,areentitledtomaternityleavebenefits.
Entitlement to maternity leave benefits is not dependent on the civil status of the pregnant woman. Every
pregnantwomanintheprivatesector,whethermarriedorunmarried,isentitledtothematernityleavebenefits.115
2.Maternitybenefits,notpartof13thmonthpaycomputation.
Maternity benefits, like other benefits granted by the SSS, are granted to employees in lieu of wages and,
therefore,maynotbeincludedincomputingtheemployees13thmonthpayforthecalendaryear.116
3.Voluntaryorselfemployedmembersnotentitledtomaternitybenefits.
Voluntary or selfemployed members are not entitled to maternity benefits because to be entitled thereto,
corresponding maternity contributions should be paid by employers. Voluntary or selfemployed members have no
employerssotheydonothavematernitycontributions.
4.Computationofmaternitybenefits.
Thematernitybenefitsshallbecomputedasfollows:
a. Exclude the semester of contingency (delivery, miscarriage or abortion). A semester refers to two
consecutivequartersendinginthequarterofcontingency.Aquarterreferstothree(3)consecutivemonths
endinginMarch,June,SeptemberorDecember.
b. Count twelve (12) months backwards starting from the month immediately before the semester of
contingency.
c.Identify the six (6) highest monthly salary credits within the 12month period. Monthly salary credit
meansthecompensationbaseforcontributionsandbenefitsrelatedtothetotalearningsforthemonth.117
d.Addthesix(6)highestmonthlysalarycreditstogetthetotalmonthlysalarycredit.
e.Dividethetotalmonthlysalarycreditby180daystogettheaveragedailysalarycredit.Thisisequaltothe
dailymaternityallowance.
f. Multiplythedailymaternityallowancebysixty(60)days(or78days)togetthetotalmaternityallowance.
5.Entitlementtomaternitybenefitforeclosesentitlementtosicknessbenefit.
AfemalememberoftheSSSwhohasavailedofmaternitybenefitcannotclaimforsicknessbenefitforaperiod
ofsixty(60)days(or78days)withinwhichshewasalreadypaidthematernitybenefit.Asarule,nomembercanbe
entitledtotwo(2)benefitsforthesameperiod.
6.NotificationtoSSSincaseofpregnancy.
ItisarequirementtonotifytheSSS.Assoonasafemalememberbecomespregnant,shemustimmediately
informheremployerofsuchpregnancybyaccomplishingtheMaternityNotificationForm.Theemployermust,inturn,
notifytheSSSthruthesubmissionofsaidform.
7.Paymentofmaternitybenefit;howmade.
Thebenefitisadvancedbytheemployertothequalifiedemployeeinfullorintwo(2)equalinstallments.The
firstinstallmentwillbepaiduponreceiptofthematernityleaveapplication.Thesecondwillbepaidnotlaterthanthirty
(30)daysafterpaymentofthefirstinstallment.Uponreceiptofsatisfactoryproofofsuchpayment,theSSSwillpay
backtheemployertheamountofmaternitybenefititlegallyadvancedtotheemployee.
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(c) Thatpaymentofdailymaternitybenefitsshallbeabartotherecoveryofsickness
benefitsprovidedbythisActforthesameperiodforwhichdailymaternitybenefits
havebeenreceived;
(d) Thatthematernitybenefitsprovidedunderthissectionshallbepaidonlyforthe
firstfour(4)deliveriesormiscarriages;
(e) That the SSS shall immediately reimburse the employer of one hundred percent
(100%) of the amount of maternity benefits advanced to the employee by the
employeruponreceiptofsatisfactoryproofofsuchpaymentandlegalitythereof;
and
(f) That ifan employee membershouldgivebirth or suffermiscarriage without the
requiredcontributionshavingbeenremittedforherbyheremployertotheSSS,or
withoutthelatterhavingbeenpreviouslynotifiedbytheemployerofthetimeof
the pregnancy, the employer shall pay to the SSS damages equivalent to the
benefitswhichsaidemployeememberwouldotherwisehavebeenentitledto.
No. XI, DOLE Handbook on Workers Statutory Monetary Benefits.

117 The table of such monthly salary credit is omitted.
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115
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3.PATERNITYLEAVE.
(R.A.NO.8187,THEPATERNITYLEAVEACTOF1996[JUNE11,1996].
a.Coverage.
Paternityleavecoversamarriedmaleemployeeallowinghimnottoreportforworkforseven(7)calendar
daysbutcontinuestoearnthecompensationtherefor,ontheconditionthathisspousehasdeliveredachildorsuffered
miscarriageforpurposesofenablinghimtoeffectivelylendsupporttohiswifeinherperiodofrecoveryand/orinthe
nursingofthenewlybornchild.118
Deliveryincludeschildbirthoranymiscarriage.119
Spousereferstothelawfulwife.Forthispurpose,lawfulwifereferstoawomanwhoislegallymarriedto
themaleemployeeconcerned.120
Cohabitingreferstotheobligationofthehusbandandwifetolivetogether.121
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c.Availment.
Theemployeeisentitledtohisfullpay,consistingofbasicsalary,fortheseven(7)calendardaysduringwhich
heisallowednottoreportforworkprovidedthathispayshallnotbelessthanthemandatedminimumwage.124
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Everymarriedemployeeintheprivateandpublicsectorsisentitledtoapaternityleaveofseven(7)calendar
dayswithfullpayforthefirstfour(4)deliveriesofthelegitimatespousewithwhomheiscohabiting.Themaleemployee
applyingforpaternityleaveshouldnotifyhisemployerofthepregnancyofhislegitimatespouseandtheexpecteddate
ofsuchdelivery.122
Paternityleavebenefitsaregrantedtothequalifiedemployeeafterthedeliverybyhiswife,withoutprejudice
to an employer allowing an employee to avail of the benefit before or during the delivery, provided that the total
number of days should not exceed seven (7) calendar days for each delivery. In the event that the paternity leave
benefitisnotavailedof,saidleaveshallnotbeconvertibletocash.123
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a.Coverage.
Parental leave is the leave benefits granted to a male or female solo parent to enable him/her to
performparentaldutiesandresponsibilitieswherephysicalpresenceisrequired.
The parental leave shall not be more than seven (7) working days every year to a solo parent who has
renderedserviceofatleastone(1)year,toenablehim/hertoperformparentaldutiesandresponsibilitieswherehis/her
physicalpresenceisrequired.Thesevendayparentalleaveshallbenoncumulative.125
Itbearsnotingthatthisleaveprivilegeisanadditionalleavebenefitwhichisseparateanddistinctfromany
otherleavebenefitsprovidedunderexistinglawsoragreements.126
Theterm"soloparent"referstoanyindividualwhofallsunderanyofthefollowingcategories:
(1) Awomanwhogivesbirthasaresultofrapeandothercrimesagainstchastityevenwithoutafinal
convictionoftheoffender:Provided,Thatthemotherkeepsandraisesthechild;
(2) Parentleftsolooralonewiththeresponsibilityofparenthoodduetodeathofspouse;
(3) Parent left solo or alone with the responsibility of parenthood while the spouse is detained or is
servingsentenceforacriminalconvictionforatleastone(1)year;
(4) Parent left solo or alone with the responsibility of parenthood due to physical and/or mental
incapacityofspouseascertifiedbyapublicmedicalpractitioner;
(5) Parent left solo or alone with the responsibility of parenthood due to legal separation or de facto
separationfromspouseforatleastone(1)year,aslongashe/sheisentrustedwiththecustodyof
thechildren;
(6) Parent left solo or alone with the responsibility of parenthood due to declaration of nullity or
annulmentofmarriageasdecreedbyacourtorbyachurchaslongashe/sheisentrustedwiththe
custodyofthechildren;
(7) Parentleftsolooralonewiththeresponsibilityofparenthoodduetoabandonmentofspouseforat
leastone(1)year;
(8) Unmarriedmother/fatherwhohaspreferredtokeepandrearher/hischild/childreninsteadofhaving
otherscareforthemorgivethemuptoawelfareinstitution;
(9) Anyotherpersonwhosolelyprovidesparentalcareandsupporttoachildorchildren;
(10)Any family member who assumes the responsibility of head of family as a result of the death,
abandonment,disappearanceorprolongedabsenceoftheparentsorsoloparent.
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4.PARENTALLEAVE.
(R.A.NO.8972,THESOLOPARENTSWELFAREACTOF2000(NOVEMBER7,2000).
Section 3, R.A. No. 8187; Section 1 [a], Revised Implementing Rules and Regulations of R.A. No. 8187 [March 13, 1997].
Section 2, Ibid.; Section 1 [c], Ibid..
Section 1 [d], Ibid..
121 Section 1 [e], Ibid..
122 Section 2, R.A. No. 8187.
123 Sections 5 and 8, Revised Implementing Rules and Regulations of R.A. No. 8187 [March 13, 1997].
124 Section 6, Revised Implementing Rules and Regulations of R.A. No. 8187 [March 13, 1997].
125 Section 18, Article V, Implementing Rules of R.A. No. 8972.
126 Section 8, R.A. No. 8972.
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Section 6. Flexible Work Schedule. The employer shall provide for a flexible working
schedule for solo parents: Provided, That the same shall not affect individual and company
productivity: Provided, further, That any employer may request exemption from the above
requirementsfromtheDOLEoncertainmeritoriousgrounds.
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Section 7. Work Discrimination. No employer shall discriminate against any solo parent
employeewithrespecttotermsandconditionsofemploymentonaccountofhis/herstatus.
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Section8.ParentalLeave.Inadditiontoleaveprivilegesunderexistinglaws,parentalleave
of not more than seven (7) working days every year shall be granted to any solo parent
employeewhohasrenderedserviceofatleastone(1)year.
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4. OtherbenefitsundertheR.A.No.8972.Otherbenefitsconsistofthefollowing:
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c.Availment.
1. Nonconversion of parental leave. In the event that the parental leave is not availed of, said leave
shallnotbeconvertibletocashunlessspecificallyagreeduponpreviously.However,ifsaidleavewere
deniedanemployeeasaresultofnoncompliancewiththeprovisionsoftheseRulesbyanemployer,
theaforementionedleavemaybeusedabasisforthecomputationofdamages.131
2. Crediting of existing leave. If there is an existing or similar benefit under a company policy, or a
collective bargaining agreement or collective negotiation agreement the same shall be credited as
such.Ifthesameisgreaterthantheseven(7)daysprovidedforintheAct,thegreaterbenefitshall
prevail.Emergencyorcontingencyleaveprovidedunderacompanypolicyoracollectivebargaining
agreementshallnotbecreditedascompliancewiththeparentalleaveprovidedforundertheActand
theseRules.132
3. Benefits.Anysoloparentwhoseincomeintheplaceofdomicilefallsbelowthepovertythresholdas
setbytheNationalEconomicandDevelopmentAuthority(NEDA)andsubjecttotheassessmentofthe
DSWD worker in the area shall be eligible for assistance: Provided, however, That any solo parent
whoseincomeisabovethepovertythresholdshallenjoythebenefitsmentionedinSections6,7and8
ofR.A.No.8972,towit:
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AchangeinthestatusorcircumstanceoftheparentclaimingbenefitsunderthisAct,suchthathe/sheis
nolongerleftalonewiththeresponsibilityofparenthood,shallterminatehis/hereligibilityforthesebenefits.127
"Children"refertothoselivingwithanddependentuponthesoloparentforsupportwhoareunmarried,
unemployedandnotmorethaneighteen(18)yearsofage,orevenovereighteen(18)yearsbutareincapableof
selfsupportbecauseofmentaland/orphysicaldefect/disability.128
"Parental responsibility" with respect to their minor children shall refer to the rights and duties of the
parentsasdefinedinArticle220ofExecutiveOrderNo.209,asamended,otherwiseknownasthe"FamilyCodeof
thePhilippines"andhereunderenumeratedasfollows:
(1) To keep them in their company, to support, educate and instruct them by right precept and good
exampleandtoprovidefortheirupbringinginkeepingwiththeirmeans;
(2) Togivethemloveandaffection,adviceandcounsel,companionshipandunderstanding;
(3) To provide them with moral and spiritual guidance, inculcate in them honesty, integrity, self
discipline,selfreliance,industryandthrift,stimulatetheirinterestincivicaffairs,andinspireinthem
compliancewiththedutiesofcitizenship;
(4) To furnish them with good and wholesome educational materials, supervise their activities,
recreation and association with others, protect them from bad company, and prevent them from
acquiringhabitsdetrimentaltotheirhealth,studiesandmorals;
(5) Torepresenttheminallmattersaffectingtheirinterest;
(6) Todemandfromthemrespectandobedience;
(7) ToImposedisciplineonthemasmayberequiredunderthecircumstances;and
(8) Toperformsuchotherdutiesasareimposedbylawanduponparentsandguardians.129
Asoloparentshallbeentitledtoparentalleaveprovidedthat:
(a) He/Shehasrenderedatleastone(1)yearofservicewhethercontinuousorbrokenatthetimeofthe
affectivityoftheAct;
(b) He/Shehasnotifiedhis/heremployeroftheavailmentthereofwithinareasonabletimeperiod;and
(c) He/ShehaspresentedaSoloParentIdentificationCardtohis/heremployer.130
Section 9. Educational Benefits. The DECS, CHED and TESDA shall provide the following
benefitsandprivileges:
Section 3[a], R.A. No. 8972; Section 6[b], Article III, Implementing Rules of R.A. No. 8972.
Section 3[b], R.A. No. 8972; Section 6[e], Article III, Implementing Rules of R.A. No. 8972.
Section 3[c], R.A. No. 8972; Section 6[f], Article III, Implementing Rules of R.A. No. 8972.
130 Section 19, Article v, Implementing Rules of R.A. No. 8972.
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(1) Scholarshipprogramsforqualifiedsoloparentsandtheirchildrenininstitutionsofbasic,
tertiaryandtechnical/skillseducation;and
(2) Nonformaleducationprogramsappropriateforsoloparentsandtheirchildren.
The DECS, CHED and TESDA shall promulgate rules and regulations for the proper
implementationofthisprogram.
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Section10.HousingBenefits.Soloparentsshallbegivenallocationinhousingprojectsand
shallbeprovidedwithliberaltermsofpaymentonsaidgovernmentlowcosthousingprojects
in accordance with housing law provisions prioritizing applicants below the poverty line as
declaredbytheNEDA.
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Section 11. Medical Assistance. The DOH shall develop a comprehensive health care
programforsoloparentsandtheirchildren.TheprogramshallbeimplementedbytheDOH
throughtheirretainedhospitalsandmedicalcentersandthelocalgovernmentunits(LGUs)
throughtheirprovincial/district/city/municipalhospitalsandruralhealthunits(RHUs).
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5.LEAVESFORVICTIMSOFVIOLENCEAGAINSTWOMEN.
(R.A.NO.9262,ANTIVIOLENCEAGAINSTWOMENANDTHEIRCHILDRENACTOF2994[MARCH8,2004).
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c.Availment.
Theavailmentoftheten(10)dayleaveshallbeattheoptionofthewomanemployee,whichshallcover
thedaysthatshehastoattendtomedicalandlegalconcerns.Leavesnotavailedofarenoncumulativeandnot
convertibletocash.
The employer/agency head who denies the application for leave, and who shall prejudice the victim
survivororanypersonforassistingacoemployeewhoisavictimsurvivorundertheActshallbeheldliablefor
discrimination and violation of R.A. No. 9262. The provision of the Labor Code and the Civil Service Rules and
Regulationsshallgovernthepenaltytobeimposedonthesaidemployer/agencyhead.136
6.SERVICECHARGES(ARTICLE96,LABORCODE).
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a.Coverage.
1. Establishments covered. The rules on service charges apply only to establishments collecting service
charges, such as hotels, restaurants, lodging houses, night clubs, cocktail lounges, massage clinics, bars,
casinosandgamblinghouses,andsimilarenterprises,includingthoseentitiesoperatingprimarilyasprivate
subsidiariesofthegovernment.137
2. Employees covered. The same rules on service charges apply to all employees of covered employers,
regardlessoftheirpositions,designationsoremploymentstatus,andirrespectiveofthemethodbywhich
theirwagesarepaid.exceptthosereceivingmorethanP2,000.00amonth.138
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b.Conditionsofentitlement.
Atanytimeduringtheapplicationofanyprotectionorder,investigation,prosecutionand/ortrialofthe
criminalcase,avictimofViolenceAgainstWomenandtheirChildren(VAWC)whoisemployedshallbeentitledto
apaidleaveofuptoten(10)daysinadditiontootherpaidleavesundertheLaborCodeandCivilServiceRulesand
Regulationsandotherexistinglawsandcompanypolicies,extendiblewhenthenecessityarisesasspecifiedinthe
protection order. The Punong Barangay/kagawad or prosecutor or the Clerk of Court, as the case may be, shall
issueacertificationatnocosttothewomanthatsuchanactionispending,andthisisallthatisrequiredforthe
employertocomplywiththe10daypaidleave.
For government employees, in addition to the aforementioned certification, the employee concerned
must file an application for leave citing as basis R.A. 9262. The administrative enforcement of this leave
entitlementshallbeconsideredwithinthejurisdictionoftheRegionalDirectoroftheDOLEunderArticle129of
the Labor Code of the Philippines, as amended, for employees in the private sector, and the Civil Service
Commission,forgovernmentemployees.135
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a.Coverage.
R.A.No.9262,grantstovictimsatotaloften(10)daysofpaidleaveofabsence,inadditiontootherpaid
leavesundertheLaborCodeandCivilServiceRulesandRegulations.Itisextendiblewhenthenecessityarisesas
specifiedintheprotectionorder.Thisisaffordedtothewomanemployeetoenablehertoattendtothemedical
andlegalconcernsrelativetosaidlaw.Thisleaveisnotconvertibletocash.133
Anyemployerwhoshallprejudicetherightofthepersonunderthislawshallbepenalizedinaccordance
with the provisions of the Labor Code and Civil Service Rules and Regulations. Likewise, an employer who shall
prejudice any person for assisting a coemployee who is a victim under this Act shall likewise be liable for
discrimination.134
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Section 43, R.A. No. 9262.

Id.
Section 42, Implementing Rules and Regulations of R.A. No. 9262.
136 Id.
137 Article 96, Labor Code; Section 1, Rule VI [Service Charges], Book III of the Rules to Implement the Labor Code.
138 Section 2, Rule VI, Book III, Rules to Implement the Labor Code.
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b.Exclusion.
Specifically excluded from coverage are employees who are receiving wages of more than P2,000.00 a
month.139However,itmustbepointedoutthattheP2,000.00ceilingisnolongerrealisticconsideringtheapplicable
minimumwagesprevailinginthecountry.Hence,itmustbedisregarded.Instead,therulenowisthatthe85%should
bedistributedtothecoveredemployeesexceptmanagerialemployees;whiletheremaining15%shouldberetainedby
management to answer for losses and breakages and for distribution to managerial employees, at the discretion of
managementinthelattercase.140
c.Distribution.
1.Percentageofsharing.Allservicechargescollectedbycoveredemployersarerequiredtobedistributedat
thefollowingrates:
a.85%tobedistributedequallyamongthecoveredemployees;and
b.15%tomanagementtoanswerforlossesandbreakagesanddistributiontoemployeesreceivingmore
thanP2,000.00amonth,atthediscretionofthemanagement.141.
2.Frequencyofdistribution.Theshareoftheemployeesreferredtoaboveshouldbedistributedandpaidto
thethemnotlessoftenthanonceeverytwo(2)weeksortwiceamonthatintervalsnotexceedingsixteen
(16)days.142
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b.Exclusions/Exemptionsfromcoverage.
ThefollowingemployersarenotcoveredbyP.D.No.851,asamended:
1. The government and any of its political subdivisions, including governmentowned and controlled
corporations,exceptthosecorporationsoperatingessentiallyasprivatesubsidiariesofthegovernment.146
2. Employersalreadypayingtheiremployees13thmonthpayormoreinacalendaryearoritsequivalentat
thetimeoftheissuanceoftheRevisedGuidelines.147
3. Employers of household helpers and persons in the personal service of another in relation to such
workers.148
4. Employersofthosewhoarepaidonpurelycommission,boundary,ortaskbasis,andthosewhoarepaida
fixed amount for performing a specific work, irrespective of the time consumed in the performance
thereof, except where the workers are paid on piecerate basis, in which case, the employer shall be
coveredbytheRevisedGuidelinesinsofarassuchworkersareconcerned.Workerspaidonpieceratebasis
shallrefertothosewhoarepaidastandardamountforeverypieceorunitofworkproducedthatismore
orlessregularlyreplicatedwithoutregardtothetimespentinproducingthesame.149
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(P.D.NO.851[DECEMBER16,1975;MEMORANDUMORDERNO.28[AUGUST13,1986];REVISEDGUIDELINES
ONTHEIMPLEMENTATIONOFTHE13THMONTHPAYLAW[NOVEMBER16,1987].
a.Coverage.
Allemployersarerequiredtopayalltheirrankandfileemployees,a13thmonthpaynotlaterthanDecember
24ofeveryyear.
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Id.
No. VII [A], DOLE Handbook on Workers Statutory Monetary Benefits.
Section 3, Rule VI, Book III, Ibid.; No. VII [A], Ibid..
142 Section 4, Rule VI, Book III, Ibid.; No. VII [B], Ibid..
143 Section 5, Rule VI, Book III, Ibid.; No. VII [B], Ibid..
144 No. VII [C], DOLE Handbook on Workers Statutory Monetary Benefits.
145 Mayon Hotel & Restaurant v. Adana, [G.R. No. 157634, May 16, 2005].
146 No. 2 [a], Revised Guidelines on the Implementation of the 13th-Month Pay Law, formerly Section 3 [b], Rules and Regulations Implementing P.D. No. 851; Alliance of Government Workers v. Minister of Labor and Employment, G.R. No. L-60403, Aug. 3, 1983.
147 Section 2, P.D. No. 851; No. 2 [b], Revised Guidelines on the Implementation of the 13th-Month Pay Law, formerly Section 3 [c], Rules and Regulations Implementing P.D. No. 851.
148 No. 2 [c], Revised Guidelines on the Implementation of the 13th-Month Pay Law, formerly Section 3 [d], Rules and Regulations Implementing P.D. No. 851.
149 No. 2 [d], Ibid., formerly Section 3 [e], Rules and Regulations Implementing P.D. No. 851.
139
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e.Someprinciplesonservicecharges.
1. Tipsandserviceschargesaretwodifferentthings.Tipsaregivenbycustomersvoluntarilytowaitersand
otherpeoplewhoservethemoutofrecognitionofsatisfactoryorexcellentservice.Thereisnocompulsion
togivetipsunderthelaw.Thesamemaynotbesaidofservicechargeswhichareconsideredintegralpart
ofthecostofthefood,goodsorservicesorderedbythecustomers.Asageneralrule,tipsdonotformpart
oftheservicechargeswhichshouldbedistributedinaccordancewiththesharingratioprescribedunder
Article96oftheLaborCode.However,wherearestaurantorsimilarestablishmentdoesnotcollectservice
chargesbuthasapracticeorpolicyofmonitoringandpoolingtipsgivenvoluntarilybyitscustomerstoits
employees,thepooledtipsshouldbemonitored,accountedforanddistributedinthesamemannerasthe
servicecharges.144Hence,the85%:15%sharingratioshouldbeobserved.
2. Servicechargesarenotinthenatureofprofitshareand,therefore,cannotbedeductedfromwage.145
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d.Integration.
In case the service charge is abolished, the share of covered employees should be considered integrated in
theirwages,inaccordancewithArticle96oftheLaborCode.Thebasisoftheamounttobeintegratedistheaverage
monthlyshareofeachemployeeforthepasttwelve(12)monthsimmediatelyprecedingtheabolitionorwithdrawalof
suchcharges.143
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c.Natureof13thmonthpay.
13thmonthpayisinthenatureofadditionalincomegrantedtoemployeeswhoarenotreceivingthesame.150
P.D.No.851isundoubtedlyalaborstandardslawwhosepurposeistoincreasetherealwagesoftheworkers.151Itis
basedonwagebutnotpartofthewage.152
Theminimum13thmonthpayrequiredbylawshouldnotbelessthanonetwelfth(1/12)ofthetotalbasic
salaryearnedbyanemployeewithinacalendaryear.153
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d.Commissionsvisavis13thmonthpay.
Inorder tobeconsideredpart of13th monthpay,thecommission should bepartofthe basic salary of the
employee.
However, whether or not a commission forms part of the basic salary depends upon the circumstances or
conditionsforitspaymentwhichindubitablyarefactualinnaturefortheywillrequireareexaminationandcalibration
oftheevidenceonrecord.154
Ifthecommissionpaidinadditiontothebasicsalaryisinthenatureofaproductivitybonusorprofitsharing
benefitwhichisdependentonandgenerallytiedtotheproductivityorcapacityforrevenueproductionofacompany,it
shouldnotbeconsideredaspartofbasicsalary.155
Butifthecommissionpaidinadditiontothebasicsalaryhasacleardirectornecessaryrelationtotheamount
ofworkactuallydonebytheemployee,itshouldbeconsideredaspartofbasicsalary.156
Iftheemployeeispaidoncommissionbasisonly,heisexcludedfromreceivingthe13thmonthpaybenefit.157
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a.Actsofdiscrimination.
Article135considersasunlawfultheactofanemployertodiscriminateagainstanywomanemployeewith
respecttotermsandconditionsofemploymentsolelyonaccountofhersex.
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Agabon v. NLRC, [G.R. No. 158693, November 17, 2004].

Alliance of Government Workers v. Minister of Labor, G.R. No. L-60403, Aug. 3, 1983; National Federation of Sugar Workers v. Ovejera, G.R. No. 59743, May 31, 1982; Marcopper Mining Corporation v. Ople, G.R. No. 51254, June 11, 1981, 105 SCRA 75.
Central Azucarera de Tarlac v. Central Azucarera de Tarlac Labor Union-NLU, G.R. No. 188949, July 26, 2010.
153 Section 2 [a], Rules and Regulations Implementing P.D. No. 851.
154 Reyes v. NLRC, [G.R. No. 160233, August 8, 2007].
155 Philippine Duplicators, Inc. v. NLRC, [G.R. No. 110068, February 15, 1995]; Boie-Takeda Chemicals, Inc. v. Dela Serna, [G.R. No. 92174] and Philippine Fuji Xerox Corporation v. Trajano, [G.R. No. 102552, March 24, 1994].
156 Id.
157 King of Kings Transport, Inc. v. Mamac, [G.R. No. 166208, June 29, 2007].
158 No. 4 [a], Revised Guidelines on the Implementation of the 13th-Month Pay Law, formerly Section 2 [b] of the Rules and Regulations Implementing P.D. No. 851; No. X [C], DOLE Handbook on Workers Statutory Monetary Benefits.
159 See No. 1, DOLE Explanatory Bulletin on the Inclusion of Teachers Overload Pay in the 13th-Month Pay Determination [December 03, 1993].
160 Honda Phils., Inc. v. Samahan ng Malayang Manggagawa sa Honda, [G.R. No. 145561, June 15, 2005]; San Miguel Corporation (Cagayan Coca-Cola Plant) v. Inciong, [G.R. No. L-49774, February 24, 1981, 103 SCRA 139].
161 No. 1, Revised Guidelines on the Implementation of the 13th-Month Pay Law; No. X [A], DOLE Handbook on Workers Statutory Monetary Benefits.
162 Ibid.; Section 1, Memorandum Order No. 28.
163 House of Sara Lee v. Rey, [G.R. No. 149013, August 31, 2006].
164 BWC Opinion dated Dec. 19, 1987, Bagong Pilipino Worlds Fashion Workers Union, Worlds Fashion, Inc..
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152
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1. Basicsalaryorbasicwagecontemplatesworkwithinthenormaleight(8)workinghoursinaday.This
meansthatthebasicsalaryofanemployeeforpurposesofcomputingthe13thmonthpayshouldinclude
allremunerationsorearningspaidbytheemployerforservicesrenderedduringnormalworkinghours.159
2. For purposes of computing the 13thmonth pay, basic salary should be interpreted to mean not the
amount actually received by an employee, but 1/12 of their standard monthly wage multiplied by their
lengthofservicewithinagivencalendaryear.160
3. Tobeentitledtothe13thmonthpaybenefit,itisimposedasaminimumservicerequirementthatthe
employeeshouldhaveworkedforatleastone(1)monthduringacalendaryear.161
4. Onlyrankandfileemployees,regardlessoftheirdesignationoremploymentstatusandirrespectiveof
themethodbywhichtheirwagesarepaid,areentitledtothe13thmonthpaybenefit.162
5. Managerialemployees,notentitledto13thmonthpay.163
6. Extras,casualsandseasonalemployees,entitledto13thmonthpay.164
==================================================
C. LABOR STANDARDS
8. Women Workers
a. Discrimination (Art. 135, LC)
b. Stipulation against marriage (Art. 136, LC)
c. Prohibited Acts (Art. 137, LC)
d. Classification of certain women workers (Art. 138, LC)
e. Anti-Sexual Harassment Act (RA 7877)
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e.CBAvisavis13thmonthpay.
Forpurposesofcomputingthe13thmonthpay,basicsalaryincludesallremunerationsorearningspaidby
theemployerforservicesrenderedbutdoesnotincludeallowancesandmonetarybenefitswhicharenotconsideredor
integratedaspartoftheregularorbasicsalary,suchasthecashequivalentofunusedvacationandsickleavecredits,
maternityleave,overtime,premium,nightdifferentialandholidaypay,premiumsforworkdoneonrestdaysandspecial
holidaysandcostoflivingallowances.However,thesesalaryrelatedbenefitsshouldbeincludedaspartofthebasic
salaryinthecomputationofthe13thmonthpayifbyindividualorcollectivebargainingagreement,companypractice
orpolicy,thesamearetreatedaspartofthebasicsalaryoftheemployees.158
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Morespecifically,itenumeratesthefollowingactsofdiscrimination:
(a) Payment of a lesser compensation, including wage, salary or other form of remuneration and fringe
benefits,toafemaleemployeeasagainstamaleemployee,forworkofequalvalue;and
(b) Favoring a male employee over a female employee with respect to promotion, training opportunities,
studyandscholarshipgrantssolelyonaccountoftheirsexes.
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ThewillfulcommissionofanyofthespecificunlawfulactsdescribedinArticle135hasacriminalconsequence.
Consequently,theoffenderwillbepenalizedunderArticles288and289oftheLaborCode.
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c.Moneyclaims,aseparateanddistinctaction.
The institution of any criminal action under Article 135 will not bar the aggrieved employee from filing an
entirely separate and distinct action for money claims, which may include claims for damages and other affirmative
reliefs.
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c.Criminalactionmayproceedindependentlyfromthemoneyclaimscase.
The criminal and money claims actions authorized to be prosecuted under Article 135 shall proceed
independentlyofeachother.165
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b.Relevantjurisprudence.
Thefollowingcasesarerelevant:
1.Zialcitav.PhilippineAirlines,Inc.,[CaseNo.RO4339876,February20,1977].Inthiscasedecidedbythe
OfficeofthePresident,theprovisioninacontractbetweenanairlinecompanyandaflightattendantwhich
statesthatflightattendantapplicantsmustbesingleandthattheyshallbeautomaticallyseparatedfrom
employmentintheeventtheysubsequentlygetmarriedwasdeclaredasanullandvoidprovision;hence,
cannotbeenforcedforbeingcontrarytoArticle136oftheLaborCodeandtheprotectiontolaborclausein
theConstitution.
2. PhilippineTelegraphandTelephoneCompanyv.NLRC,[G.R.No.118978,May23,1997,272SCRA596,
605].Itwasdeclaredherethatthecompanypolicyofnotacceptingorconsideringasdisqualifiedfromwork
anywomanworkerwhocontractsmarriagerunsafoulofthetestof,andtherightagainst,discrimination
affordedallwomenworkersbyourlaborlawsandbynolessthantheConstitution.167
3. StarPaperCorp.v.Simbol,ComiaandEstrella,[G.R.No.164774,April12,2006].Thefollowingpolicies
were struck down as invalid for violating the standard of reasonableness which is being followed in our
jurisdiction,otherwisecalledtheReasonableBusinessNecessityRule:
1.Newapplicantswillnotbeallowedtobehiredifincasehe/shehas[a]relative,upto[the]
3rddegreeofrelationship,alreadyemployedbythecompany.
2.In case of two of our employees (both singles [sic], one male and another female)
developedafriendlyrelationshipduringthecourseoftheiremploymentandthendecidedto
getmarried,oneofthemshouldresigntopreservethepolicystatedabove.
4. Duncan Association of Detailman-PTGWO v. Glaxo Welcome Philippines, Inc., [G.R. No. 162994,
September 17, 2004]. In this case, the prohibition against marriage embodied in the following stipulation in
the employment contract was held as valid:
10.Youagreetodisclosetomanagementanyexistingorfuturerelationshipyoumayhave,
either by consanguinity or affinity with coemployees or employees of competing drug
companies.Shoulditposeapossibleconflictofinterestinmanagementdiscretion,youagree
toresignvoluntarilyfromtheCompanyasamatterofCompanypolicy.
The Supreme Court ruled that dismissal based on this stipulation in the employment contract is a valid
exercise of management prerogative. The prohibition against personal or marital relationships with
employees of competitor companies upon its employees was held reasonable under the circumstances
becauserelationshipsofthatnaturemightcompromisetheinterestsofthecompany.Inlayingdownthe
assailed company policy, the employer only aims to protect its interests against the possibility that a
competitorcompanywillgainaccesstoitssecretsandprocedures.
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Article 136 considers as an unlawful act of the employer to require as a condition for or continuation of
employmentthatawomanemployeeshallnotgetmarriedortostipulateexpresslyortacitlythatupongettingmarried,
awomanemployeeshallbedeemedresignedorseparated,
Itislikewiseanunlawfulactoftheemployer,toactuallydismiss,discharge,discriminateorotherwiseprejudice
awomanemployeemerelybyreasonofhermarriage.166
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2.STIPULATIONAGAINSTMARRIAGE(ARTICLE136,LABORCODE).
Article 135, Labor Code.

See also Section 13 [e], Rule XII, Book III, Rules to Implement the Labor Code; Gualberto v. Marinduque Mining Industrial Corporation, C.A.-G.R. No. 52753-R, June 28, 1978.
See also Gualberto v. Marinduque Mining & Industrial Corporation, supra; Zialcita, v. Philippine Airlines, supra; 45A Am. Jur. 2d, Job Discrimination, Sec. 506, p. 486.
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3.PROHIBITEDACTS.(ARTICLE137,LABORCODE).
a.ProhibitedactsunderArticle137anditsimplementingrules.
ThecorrespondingprovisionsintheRulestoImplementtheLaborCodeprovideforabroaderenumerationof
prohibitedactsthanthosefoundinArticle137.Itisprovidedthereunderthatitshallbeunlawfulforanyemployer:
1.To discharge any woman employed by him for the purpose of preventing such woman from enjoying
maternityleave,facilitiesandotherbenefitsprovidedundertheLaborCode;
2. Todischargesuchwomanonaccountofherpregnancy,orwhileonleaveorinconfinementduetoher
pregnancy;
3.Todischargeorrefusetheadmissionofsuchwomanuponreturningtoherworkforfearthatshemayagain
bepregnant;
4. Todischargeanywomanoranyotheremployeeforhavingfiledacomplaintorhavingtestifiedorbeing
abouttotestifyundertheLaborCode;or
5.Torequireasaconditionfororcontinuationofemploymentthatawomanemployeeshallnotgetmarried
ortostipulateexpresslyortacitlythatupongettingmarried,awomanemployeeshallbedeemedresigned
or separated, or to actually dismiss, discharge, discriminate or otherwise prejudice a woman employee
merelybyreasonofmarriage.168
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c.Dischargingawomanduetopregnancy.
Paragraph [a] (2) and (3) of Article 137 contemplates the following prohibited acts in connection with the
pregnancyofawomanemployee:
1. Todischargeheronaccountofherpregnancy;or
2. Todischargeherwhilesheisonleaveduetoherpregnancy;or
3. Todischargeherwhilesheisinconfinementduetoherpregnancy;or
4. Todischargeheruponreturningtoherworkforfearthatshemayagainbepregnant;or
5. Torefuseheradmissionuponreturningtoherworkforfearthatshemayagainbepregnant.170
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DelMontePhilippines,Inc.v.Velasco,[G.R.No.153477,March6,2007].
The series of absences of the respondent due to pregnancy and its related ailments, such as urinary tract
infection,wasfoundnottobeavalidgroundtodismissherfromemployment.TheSupremeCourtagreedwiththe
CourtofAppealsinconcludingthatrespondentssicknesswaspregnancyrelatedand,therefore,thepetitionercannot
terminaterespondentsservicesbecauseindoingso,petitionerwill,ineffect,beviolatingtheLaborCodewhich,under
Article137thereof,prohibitsanemployertodischargeanemployeeonaccountofthelatterspregnancy.TheCourt
wasconvincedthatthepetitionerterminatedtheservicesofrespondentonaccountofherpregnancywhichjustifiedher
absencesand,thus,committedaprohibitedactrenderingthedismissalillegal.
LakpueDrug,Inc.v.Belga,[G.R.No.166379,October20,2005].
Respondent was dismissed for allegedly deliberately concealing her pregnancy and for incurring absences
withoutofficialleavefor16daysatwhichtimeshedeliveredherbaby.Petitionerarguesthatsuchnondisclosureis
tantamounttodishonesty.Infindingthepenaltyofdismissaltooharshandillegal,theSupremeCourtruledthatthe
alleged misconduct of Belga barely falls within the situation contemplated by the law. Her absence for 16 days was
justifiedconsideringthatshehadjustdeliveredachild,whichcanhardlybeconsideredaforbiddenact,aderelictionof
duty;muchlessdoesitimplywrongfulintentonthepartofBelga.PetitionerharpsontheallegedconcealmentbyBelga
of her pregnancy.This argument, however, begs the question as to how one can conceal a fullterm pregnancy.The
Courtagreedwithrespondentspositionthatitcanhardlyescapenoticehowshegrowsbiggereachday.Whilethere
may be instances where the pregnancy may be inconspicuous, it has not been sufficiently proven by petitioner that
Belgascaseissuch.
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b.Denialofbenefitsordismissalofawomanemployeetodepriveherofbenefits.
Paragraph[a](1)ofArticle137speaksoftwoseparateprohibitedacts,namely:
1. To deny any woman employee the benefits provided in Chapter I (Employment of Women), Title III
(WorkingConditionsforSpecialGroupsofEmployees)ofBookIIIoftheLaborCode,namely:
a. FacilitiesforwomenunderArticle132;
b. MaternityleavebenefitsunderArticle133;and
c. FamilyplanningservicesandincentivesforfamilyplanningunderArticle134.
2. Todischargeanywomanemployeeforthepurposeofpreventingherfromenjoyinganyofthebenefits
providedundertheLaborCode.169
UnderNo.1above,meredenialoftheaforedescribedbenefitswouldalreadyconstituteaviolationofArticle
137.
UnderNo.2above,itisrequiredthattheremustnotonlybedenialbutactualdischargeordismissalofthe
womanemployeemeanttopreventherfromenjoyinganyofthebenefitsundertheLaborCodeandnotonlyofthe
benefitsunderChapterI,TitleIIIofBookIIIoftheLaborCode.
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169
170
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Section 13, Rule XII, Book III thereof.

See also Section 13, Rule XII, Book III, Rules to Implement the Labor Code.
See also Section 13, Rule XII, Book III, Rules to Implement the Labor Code.
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d.Dischargingawomanemployeeforhavingfiledacaseorfortestifyingorbeingabouttotestifyinacase.
CitedasadditionalprohibitedactinSection13,RuleXII,BookIIIoftheRulestoImplementtheLaborCodeisthe
actofdischarginganywomanoranyotheremployeeforhavingfiledacomplaintorhavingtestifiedorbeingaboutto
testifyundertheLaborCode.
Of relevance to this prohibited actare the parallel provisions in Articles118 and248 [f]of the Labor Code.
Under Article 118, it is considered unlawful for an employer to discharge or in any manner discriminate against any
employeewhohasfiledanycomplaintorinstitutedanyproceedingunderTitleII(Wages)ofBookIIIorhastestifiedoris
about to testify in such proceedings. Under Article 248 [f], it is considered an unfair labor practice (ULP) to dismiss,
dischargeorotherwiseprejudiceordiscriminateagainstanemployeeforhavinggivenorbeingabouttogivetestimony
under the Labor Code. This is the only ULP act of the employer which need not be related to the exercise by the
employeeofhisrighttoselforganizationandcollectivebargaining.171
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e.PenaltyforcommissionoftheprohibitedactsunderArticle137.
Havingbeendeclaredunlawful,thecommissionofanyoftheprohibitedactsunderArticle137wouldsubject
theoffendertothepenaltiesprovidedunderArticle288oftheLaborCode.
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4.CLASSIFICATIONOFCERTAINWOMANWORKERS(ARTICLE138,LABORCODE).
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5.ANTISEXUALHARASSMENTACT(R.A.NO.7877,FEBRUARY14,1995).
b.Specificactspenalized.
Thelawpunishessexualharassmentifthesameis:
1. workrelated;or
2. educationrelated;or
3. trainingrelated.173
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a.Three(3)situationsonly.
R.A.No.7877declaressexualharassmentunlawfulonlyinthree(3)situations,namely:
(1)employment,
(2)education,or
(3)trainingenvironment.
Itmustbeunderscoredattheoutsetthatsexualharassmentisnotthesoledomainofwomenasmenmayalso
besubjectedtothesamedespicableact.Saidlawdoesnotlimitthevictimofsexualharassmenttowomen.
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c.Hospitalitygirlsarenotregularemployees..
InanopinionoftheDepartmentofJusticedatedOctober27,1954,itwasopinedthathospitalitygirlsarenot
consideredemployeeswhenthenightcluboperatordoesnotcontrolnordirectthedetailsandmanneroftheirworkin
theentertainmentofnightclubpatronsand,havingnofixedhoursofwork,theymaycomeandgoastheyplease.
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d.Personswhomaybeliableforsexualharassment.
Work, education or trainingrelated sexual harassment is committed by any employer, employee, manager,
supervisor, agent of the employer, teacher, instructor, professor, coach, trainor, or any other person who, having
authority, influence or moral ascendancy over another in a work or training or education environment, demands,
requests or otherwise requires any sexual favor from another, regardless of whether the demand, request or
requirementforsubmissionisacceptedbytheobjectofsaidact.174
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b.Regularityofemployment.
Anywomanwhoispermittedorsufferedtowork,withorwithoutcompensation,inanynightclub,cocktail
lounge, massage clinic, bar or similar establishments may be considered an employee of such establishment for
purposesoflaborandsociallegislationifthefollowingrequisitesconcur:
1. Sheworksundertheeffectivecontrolorsupervisionoftheemployer;and
2. She has worked therein for a substantial period of time as determined by the Secretary of Labor and
Employment.172
InaccordancewithArticle138,inrelationtoArticle280,oftheLaborCode,suchwomenworkinginnightclubs
and similar establishments are considered regular employees thereof considering that they are made to perform
activitiesthatareusuallynecessaryordesirableintheusualbusinessortradeoftheiremployer.
It bears noting that under Article 135 of the Labor Code, it is considered unlawful for any employer to
discriminateagainstanywomanemployeewithrespecttotermsandconditionsofemploymentsolelyonaccountofher
sex.
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a.Womenworkinginnightclubsandsimilarestablishments.
Article138enunciatestheruleapplicabletowomenemployeeswhoworkregularlyduringnighttimeinplaces
ofentertainment.Thesituationhereincontemplated,becauseofitspeculiarfeature,constitutesanexceptiontothe
prohibitionagainstnighttimeworkprescribedinArticle130,althoughthesamewasneverincludedintheenumeration
oftheexceptedinstancesunderArticle131.
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Philcom Employees Union v. Philippine Global Communications, G.R. No. 144315, July 17, 2006; See also Bisig Manggagawa sa Tryco v. NLRC, G.R. No. 151309, Oct. 15, 2008.
Article 138, Labor Code; Section 4, Rule XII, Book III, Rules to Implement the Labor Code.
Section 3, R.A. No. 7877.
174 Id..
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Further,anypersonwhodirectsorinducesanothertocommitanyactofsexualharassmentasdefinedinthe
law,orwhocooperatesinthecommissionthereofbyanotherwithoutwhichitwouldnothavebeencommitted,shall
alsobeheldliableunderthelaw.175
e.Sexualharassmentinaworkrelatedoremploymentenvironment.
Inaworkrelatedoremploymentenvironment,sexualharassmentiscommittedwhen:
1. The sexual favor is made a condition in the hiring or in the employment, reemployment or continued
employment of said individual or in granting said individual favorable compensation, terms, conditions,
promotions, or privileges; or the refusal to grant the sexual favor results in limiting, segregating or
classifying the employee which in any way would discriminate, deprive or diminish employment
opportunitiesorotherwiseadverselyaffectsaidemployee;
2.Theaboveactswouldimpairtheemployeesrightsorprivilegesunderexistinglaborlaws;or
3.Theaboveactswouldresultinanintimidating,hostile,oroffensiveenvironmentfortheemployee.176
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f.Sexualharassmentinaneducationortrainingenvironment.
Inaneducationortrainingenvironment,sexualharassmentiscommitted:
1.againstonewhoisunderthecare,custodyorsupervisionoftheoffender;
2.againstonewhoseeducation,training,apprenticeshiportutorshipisentrustedtotheoffender;
3.whenthesexualfavorismadeaconditiontothegivingofapassinggrade,orthegrantingofhonorsand
scholarships,orthepaymentofastipend,allowanceorotherbenefits,privileges,orconsiderations;or
4.whenthesexualadvancesresultinanintimidating,hostileoroffensiveenvironmentforthestudent,trainee
orapprentice.178
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Yet,evenifweweretotestRayalasactsstrictlybythestandardssetinSection3,RA7877,
hewouldstillbeadministrativelyliable.Itistruethatthisprovisioncallsforademand,requestor
requirementofasexualfavor.Butitisnotnecessarythatthedemand,requestorrequirementofa
sexualfavorbearticulatedinacategoricaloralorwrittenstatement.Itmaybediscerned,withequal
certitude, from the acts of the offender. Holding and squeezing Domingos shoulders, running his
fingersacrossherneckandticklingherear,havinginappropriateconversationswithher,givingher
moneyallegedlyforschoolexpenseswithapromiseoffutureprivileges,andmakingstatementswith
unmistakablesexualovertonesalltheseactsofRayalaresoundwithdeafeningclaritytheunspoken
requestforasexualfavor.
Likewise, contrary to Rayalas claim, it is not essential that the demand, request or
requirement be made as a condition for continued employment or for promotion to a higher
position.Itisenoughthattherespondentsactsresultincreatinganintimidating,hostileoroffensive
environment for the employee. That the acts of Rayala generated an intimidating and hostile
environment for Domingo is clearly shown by the common factual finding of the Investigating
Committee,theOPandtheCAthatDomingoreportedthemattertoanofficemateand,afterthelast
incident,filedforaleaveofabsenceandrequestedtransfertoanotherunit.
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Libresv.NLRC,[G.R.No.123737,May28,1999].
Theactofthemanagerintouchingafemalesubordinateshandandshoulder,caressinghernapeandtelling
other people that the subordinate was the one who hugged and kissed him or that she responded to his sexual
advances, was considered an act of sexual harassment for which he was penalized by the company with a 30day
suspensionwhosevaliditytheSupremeCourtaffirmed.177
Domingov.Rayala,[G.R.No.155831,February18,2008].
ThisinvolvesasexualharassmentsuitfiledagainstRogelioI.Rayala,theformerChairmanoftheNationalLabor
Relations Commission (NLRC) by a subordinate, Ma. Lourdes T. Domingo, then Stenographic Reporter III. Rayala
contends that the acts ascribed to him do not constitute sexual harassment, because Domingo did not allege in her
complaint that there was a demand, request, or requirement of a sexual favor as a condition for her continued
employmentorforherpromotiontoahigherposition.IndisagreeingtothispostulationandinholdingRayalaliablefor
sexualharassment,theHighCourtruled:
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It is the duty of the employer or the head of the workrelated, educational or training environment or
institution, to prevent or deter the commission of acts of sexual harassment and to provide the procedures for the
resolutionorprosecutionofactsofsexualharassment.
Towardsthisend,theemployerorheadofofficeisrequiredto:
1.promulgateappropriaterulesandregulationsinconsultationwithandjointlyapprovedbytheemployees
orstudentsortrainees,throughtheirdulydesignatedrepresentatives,prescribingtheprocedureforthe
investigation of sexual harassment cases and the administrative sanctions therefor. The said rules and
Id..
Section 3[a], Republic Act No. 7877.
Villarama v. NLRC and Golden Donuts, Inc., [G.R. No. 106341, September 2, 1994].
178 Section 3[b], Ibid..
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b.Regulationofworkinghoursofachild.
Thetermhoursofworkincludes(1)alltimeduringwhichachildisrequiredtobeataprescribedworkplace,
and(2)alltimeduringwhichachildissufferedorpermittedtowork.Restperiodsofshortdurationduringworking
hoursshallbecountedashoursworked.184
The following hours of work shall be observed for any child allowed to work under R.A. No. 9231 and its
ImplementingRules:
(a) Forachildbelowfifteen(15)yearsofage,thehoursofworkshallnotbemorethantwenty(20)hoursper
week,providedthattheworkshallnotbemorethanfour(4)hoursatanygivenday;
(b) Forachildfifteen(15)yearsofagebutbeloweighteen(18),thehoursofworkshallnotbemorethaneight
(8)hoursaday,andinnocasebeyondforty(40)hoursaweek;and
(c) Nochildbelowfifteen(15)yearsofageshallbeallowedtoworkbetweeneight(8)oclockintheevening
andsix(6)oclockinthemorningofthefollowingdayandnochildfifteen(15)yearsofagebutbelow
eighteen(18)shallbeallowedtoworkbetweenten(10)oclockintheeveningandsix(6)oclockinthe
morningofthefollowingday.185
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a.Child,workingchild.meaning.
Forlegalpurposes,thetermchildreferstoanypersonlessthaneighteen(18)yearsofage.
Aworkingchildreferstoanychildengagedasfollows:
i.whenthechildisbeloweighteen(18)yearsofage,inworkoreconomicactivitythatisnotchildlabor;and
ii.whenthechildbelowfifteen(15)yearsofage:
(a) inworkwherehe/sheisdirectlyundertheresponsibilityofhis/herparentsorlegalguardianandwhere
onlymembersofthechildsfamilyareemployed;or
(b) inpublicentertainmentorinformationwhichreferstoartistic,literary,andculturalperformancesfor
television show, radio program, cinema or film, theater, commercial advertisement, public relations
activitiesorcampaigns,printmaterials,internet,andothermedia.
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Dr.RicoS.Jacutinv.PeopleofthePhilippines,[G.R.No.140604,March6,2002].
Thiscaseillustratestheproperpenaltyimposableontheviolator.Here,theSupremeCourtaffirmedthe
SandiganbayansdecisionfindingDr.RicoJacutinySalcedoguiltyofthecrimeofsexualharassmentdefined
and punished under R.A. No. 7877, particularly Sections 3 and 7 thereof, and penalizing him with
imprisonmentofsix(6)monthsandtopayafineofTwentyThousand(P20,000.00)Pesos,withsubsidiary
imprisonmentincaseofinsolvency.Additionally,hewasorderedtoindemnifytheoffendedparty,Juliet
Yee, in the amount of P30,000.00 and P20,000.00 by way of moral damages and exemplary damages,
respectively.
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regulations issued shall include, among others, guidelines on proper decorum in the workplace and
educationalortraininginstitutions.
2. create a committee on decorum and investigation of cases on sexual harassment. The committee shall
conduct meetings, as the case may be, with officers and employees, teachers, instructors, professors,
coaches, trainors and students or trainees to increase understanding and prevent incidents of sexual
harassment.Itshallalsoconducttheinvestigationofallegedcasesconstitutingsexualharassment.
Inthecaseofworkrelatedenvironment,thecommitteeiscomposedofatleastone(1)representativeeach
from the management, the union, if any, the employees from the supervisory rank and from the rankandfile
employees.
Inthecaseofeducationalortraininginstitution,thecommitteeiscomposedofatleastone(1)representative
fromtheadministration,thetrainors,teachers,instructors,professors,orcoachesandstudentsortrainees,asthecase
maybe.179
h.Someprinciplesonsexualharassment.
1. Theemployerorheadofofficeortheeducationalortraininginstitutionaresolidarilyliablefordamages
arising from the acts of sexual harassment committed in an employment, education or training
environment,ifsuchemployerorheadofofficeoreducationalortraininginstitutionisinformedofsuch
actsbytheoffendedpartyandnoimmediateactionistakenthereon.180
2. Thevictimofsexualharassmentisnotprecludedfrominstitutingaseparateandindependentactionfor
damagesandotheraffirmativereliefs.181
3. Anyactionarisingfromsexualharassmentprescribesinthree(3)years.182
4. Any person who violates the provisions of R.A. No. 7877 shall, upon conviction, be penalized by
imprisonmentofnotlessthanone(1)monthnormorethansix(6)months,orafineofnotlessthanten
thousand pesos (P10,000.00) nor more than twenty thousand pesos (P20,000.00) or both such fine and
imprisonmentatthediscretionofthecourt.183
Section 4, Ibid..
Section 5, Ibid..
Section 6, Ibid..
182 Section 7, Ibid..
183 Section 7, Ibid..
184 Section 3, Chapter 1, Department Order No. 65-04.
185 Section 15, Chapter 5, Ibid.; Section 12-A, R.A. No. 7610, as added by Section 3, R.A. No. 9231.
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c.Employmentofthechildinpublicentertainment.
Sleeping timeas well astravel time of achild engaged in public entertainment or information from his/her
residencetohis/herworkplaceshallnotbeincludedashoursworkedwithoutprejudicetotheapplicationofexisting
rulesonemployeescompensation.186
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d.Prohibitionofemployingminorsincertainundertakingsandincertainadvertisements
Nochildbeloweighteen(18)yearsofageisallowedtobeemployedasamodelinanyadvertisementdirectly
orindirectlypromotingalcoholicbeverages,intoxicatingdrinks,tobaccoanditsbyproducts,gamblingoranyformof
violenceorpornography.187
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C. LABOR STANDARDS
10. Employment of Househelpers
a. Definition
b. Benefits accorded househelpers
c. Termination
d. Reliefs for unjust termination
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a.Definition.
Thetermhousehelperissynonymoustothetermdomesticservantandshallrefertoanyperson,whether
maleorfemale,whorendersservicesinandabouttheemployershomeandwhoseservicesareusuallynecessaryor
desirableforthemaintenanceandenjoymentthereof,andministersexclusivelytothepersonalcomfortandenjoyment
of the employers family.192 It refers to any person who renders domestic or household services exclusively to a
householdemployer.Examplesaredrivers,babysitters,gardeners,cooks,nursemaidsoryaya,andthelike.193
b.Benefitsaccordedhousehelpers.
Househelpersareentitledtothefollowingbenefits:
1. Minimumwage.TheminimumwageratesprescribedunderArticle143oftheLaborCodewhichrefersto
basiccashwagesmentionedinArticle144.Theseminimumwageratesareonamonthlybasis.[NOTE:
TheminimumwageratesprescribedbyRTWPBsdonotapplytohousehelpers].
2. Salaryrateincaseofassignmentincommercial,industrialoragriculturalestablishments.Househelpers
shouldnotbeassignedtoworkincommercial,industrialoragriculturalenterprises.However,ifsorequired
toworkthereat,thewageorsalaryrateshouldnotbelowerthanthatprovidedforagriculturalornon
agriculturalworkersasprescribedbylaworwageorder.194
3. Lodging,foodandmedicalattendance.Suitableandsanitarylivingquarters(lodging)aswellasadequate
food and medical attendance, free of charge.195 Article 1689 of the Civil Code enunciates the rule that
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1. Generalrule.Thegeneralruleisthatnochildbelowfifteen(15)yearsofageshallbeemployed,permitted
orsufferedtoworkinanypublicorprivateestablishment.188
2. Exceptions. The following shall be the only exceptions to the prohibition on the employment of a child
belowfifteen(15)yearofage:
(a) Whenthechildworksunderthesoleresponsibilityofhis/herparentsorguardian,providedthatonly
membersofthechildsfamilyareemployed.
(b) When the childs employment or participation in public entertainment or information is essential,
regardlessoftheextentofthechildsrole.189
3. Conditionstotheprohibition.Suchemploymentshallbestrictlyunderthefollowingconditions:
i. ThetotalnumberofhoursworkedshallbeinaccordancewithSection15[HoursofWorkofaWorking
Child]oftheRules[infra];
ii.The employment does not endanger the childs life, safety, health and morals, nor impair the childs
normaldevelopment;
iii.Thechildisprovidedwithatleastthemandatoryelementaryorsecondaryeducation;and
iv.TheemployersecuresaworkpermitforthechildinaccordancewithSections8to12oftheRules.190
Normaldevelopmentofthechildreferstothephysical,emotional,mental,andspiritualgrowthofachild
within a safe and nurturing environment where he/she is given adequate nourishment, care and protection and the
opportunitytoperformtasksappropriateateachstageofdevelopment.191
Id..
Section 6, Chapter 2, Department Order No. 65-04; Section 14, Article VIII, R.A. No. 7610, as amended by Section 5, R.A. No. 9231.
Section 4, Chapter 2, Ibid..
189 Section 7, Chapter 3, Ibid..
190 Id..
191 Section 3, Chapter 1, Ibid..
192 Article 141, Labor Code; Section 1 [b], Rule XIII, Book III, Rules to Implement the Labor Code.
193 SSS Circular No. 21-V issued by the SSS Administrator on September 1, 1993.
194 Article 145, Labor Code; Section 10, Rule XIII, Book III, Rules to Implement the Labor Code.
195 Article 148 of the Labor Code.
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d.Reliefsforunjusttermination.
Thefollowingprinciplesapplyinrelationtoreliefsavailabletohousehelpersincaseofunjusttermination
1. ThereliefstowhichanunjustlydismissedhousehelperisentitledareprovidedforinArticle149.Suchrelief
isinthenatureofanindemnity.Thus,ifthehousehelperisunjustlyterminated,heorsheshallbepaid
thecompensationalreadyearnedplusthatforfifteen(15)daysbywayofindemnity.
2. ThereliefsforillegaldismissalunderArticle280oftheLaborCodedonotapplytounjustterminationof
househelpers.Clearly,noreliefofreinstatementorseparationpayinlieuofreinstatementtowhichan
illegallydismissedregularemployeeisentitledisgrantedtoanillegallydismissedhousehelper.
Article 144, Labor Code; Section 8, Rule XIII, Book III, Rules to Implement the Labor Code; SSS Circular No. 21-V issued by the SSS Administrator on September 1, 1993.
Article 1695 of the Civil Code.
Article 146 of the Labor Code.
199 See Section 11, Rule XIII, Book III, Rules to Implement the Labor Code.
200 Article 1695 of the Civil Code.
201 Last paragraph of Article 143 of the Labor Code.
202 See also Section 5, Rule XIII, Book III, Rules to Implement the Labor Code.
203 No. II [2], Ibid..
204 No. V, Ibid..
205 Househelpers were included in the coverage of the Retirement Pay Law by virtue of Department Order No. 20, issued by Secretary Ma. Nieves Roldan Confesor on May 31, 1994. On October 24, 1996, Secretary Leonardo A. Quisumbing issued his Labor Advisory on the Retirement
Pay Law where they have been expressly and categorically included within the coverage of this law.
206 Section 16, Rule XIII, Book III thereof.
207 Philemploy Services and Resources, Inc. v. Rodriguez, [G.R. No. 152616, March 31, 2006].
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c.Termination.
Thefollowingprinciplesapplytotheterminationofemploymentofahousehelper:
1. Theemploymentofhousehelpers,beingonafixedtermbasis,terminatesuponitsexpiration.Article142,
indescribingthecontractofdomesticservice,explicitlyprovidesthat(t)heoriginalcontractofdomestic
serviceshallnotlastformorethantwo(2)yearsbutitmayberenewedforsuchperiodsasmaybeagreed
uponbytheparties.Theuseofthewordrenewalunderscorestooclearlythatthecontractofdomestic
servicehasanexpirationdatewhich,foritscontinuedeffectivity,needstoberenewedbytheemployer
andthehousehelper.
2. Thecontractofemploymentofhousehelpersisterminablebymerenotice,aclearindicationofthefixed
nature of its term. Article 150 simply requires that (i)f the duration of the household service is not
determinedeitherinstipulationorbythenatureoftheservice,theemployerorthehousehelpermaygive
noticetoputanendtotherelationshipfive(5)daysbeforetheintendedterminationoftheservice.
3. Househelpersenjoysecurityoftenureonlyduringtheeffectivityoftheirfixedtermemployment.Afterits
expiration,norighttosecurityoftenuremaybeinvokedbythem.Thus,itisprovidedinArticle149that(i)f
the period of household service is fixed, neither the employer nor the househelper may terminate the
contractbeforetheexpirationoftheterm,exceptforajustcause.
4. Dueprocessshouldbeobservedinterminatingtheemploymentofhousehelpers.ThefactthatArticle149
providesthat(i)ftheperiodofhouseholdserviceisfixed,neithertheemployernorthehousehelpermay
terminatethecontractbeforetheexpirationoftheterm,exceptforajustcause,isarecognitionthatdue
processhastobeobservedtodeterminewhetherjustcausereallyexiststojustifythedismissal.207
5. Househelpers cannot acquire regularity of employment. They are not included in the concept of regular
employmentunderArticle280[RegularandCasualEmployment]oftheLaborCode.
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household service shall always be reasonably compensated. Any stipulation that household service is
withoutcompensationshallbevoid.Lodging,foodandmedicalattendancearenotincludedintheterm
basiccashwage.196
4. Normalhoursofwork.Househelpersshallnotberequiredtoworkformorethanten(10)hoursaday.197
5. Overtimepay.Ifthehousehelperconsentstorenderovertimework,heshouldbepaidovertimepay.In
thesamevein,ifthenatureofhisjobrequireshimtoworkovertime,hehastorenderovertimework.
6. Opportunity for elementary education. If the househelper is under the age of eighteen (18) years, the
employershouldgivehimorheranopportunityforatleastelementaryeducation.198Thecostofeducation
shallbepartofthehousehelperscompensation,unlessthereisastipulationtothecontrary.199
7. Monthlyvacation.Thehousehelpershallbeallowedfour(4)daysvacationwithpayeachmonth.200
8. Compulsory SSS coverage. It is mandated under the Labor Code201 that in case the monthly wage of a
househelperisatleastOnethousandpesos(P1,000.00),suchhousehelpershallbecoveredbytheSocial
SecuritySystem(SSS)andbeentitledtoallthebenefitsprovidedthereunder.202Compulsorycoverageofa
househelper shall take effect on the day of his/her employment in a household but not earlier than
September1,1993.203Acoveredhousehelperisentitledtothesamebenefits,loansandotherprivileges
that are made available to a regular covered employee under the Social Security (SS), PhilHealth and
EmployeesCompensation(EC)laws.204
9. Retirementbenefits.Ahousehelpermayretireuponreachingtheageof60(optional)or65(compulsory)
underArticle287oftheLaborCode.205
10.Funeralbenefit.AccordingtotheRulestoImplementtheLaborCode,incaseofdeathofahousehelper,the
employershallbearthefuneralexpensescommensuratetothestandardsoflifeofthedeceased.206
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C. LABOR STANDARDS
11. Employment of Homeworkers
a. Definition
b. Rights and benefits accorded
homeworkers
c. Conditions for deduction from
homeworkers earnings
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Relevant Provisions: Articles 153 to 155, Labor Code; Department OrderNo.5, [February4,1992] enunciating the
regulationsgoverningtheemploymentofhomeworkers.ThisDepartmentOrderisnowknownas
RuleXIV,BookIIIoftheRulestoImplementtheLaborCode.
1.DEFINITIONS.
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a.Industrialhomeworker,defined.
Anindustrialhomeworkerisaworkerwhoisengagedinindustrialhomework.208
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b.Industrialhomework,defined.
Industrialhomeworkisasystemofproductionunderwhichworkforanemployerorcontractoriscarriedout
byahomeworkerathis/herhome.Materialsmayormaynotbefurnishedbytheemployerorcontractor.
Itdiffersfromregularfactoryproductionprincipallyinthat,itisadecentralizedformofproductionwherethere
isordinarilyverylittlesupervisionorregulationofmethodsofwork.209
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e.Employer,defined.
Employer means any natural or artificial person who, for his own account or benefit, or on behalf of any
personresidingoutsidethePhilippines,directlyorindirectly,orthroughanyemployee,agent,contractor,subcontractor
oranyotherperson:
1. deliversorcausestobedeliveredanygoods,articlesormaterialstobeprocessedorfabricatedinorabouta
homeandthereaftertobereturnedortobedisposedofordistributedinaccordancewithhisdirection;or
2. sellsanygoods,articlesormaterialsforthepurposeofhavingsuchgoodsorarticlesprocessedinorabouta
homeandthenrepurchasesthemhimselforthroughanotheraftersuchprocessing.
f.Contractororsubcontractor,defined.
Contractororsubcontractormeansanypersonwho,fortheaccountorbenefitofanemployer,deliversor
causestobedeliveredtoahomeworker,goodsorarticlestobeprocessedinorabouthishomeandthereaftertobe
returned,disposedofordistributedinaccordancewiththedirectionoftheemployer.212
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Processingmeansmanufacturing,fabricating,finishing,repairing,altering,packing,wrappingorhandlingin
anywayconnectedwiththeproductionorpreparationofanarticleormaterial.213
2.RIGHTSANDBENEFITSACCORDEDHOMEWORKERS.
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a.Dutiesofemployer,contractororsubcontractor.
Wheneveranemployercontractswithanotherfortheperformanceoftheemployerswork,itshallbetheduty
of such employer toprovide in suchcontract that the employeesor homeworkers ofthe contractor and the latters
subcontractorshallbepaidinaccordancewiththeprovisionsofRuleXIVoftheRulestoImplementtheLaborCode.In
theeventthatsuchcontractororsubcontractorfailstopaythewagesorearningsofhisemployeesorhomeworkersas
specifiedinsaidRules,suchemployershallbejointlyandseverallyliablewiththecontractororsubcontractortothe
workers of the latter, to the extent that such work is performed under such contract, in the same manner as if the
employeesorhomeworkersweredirectlyengagedbytheemployer.Theemployer,contractororsubcontractorshall
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d.Fieldpersonnel,defined.
Afieldpersonnelisanonagriculturalemployeewhoregularlyperformshisdutiesawayfromtheprincipal
placeofbusinessorbranchofficeoftheemployerandwhoseactualhoursofworkinthefieldcannotbedetermined
withreasonablecertainty.211
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c.Home,defined.
Homemeansanynook,house,apartmentorotherpremisesusedregularly,inwholeorinpart,asadwelling
place,exceptthosesituatedwithinthepremisesorcompoundofanemployer,contractor/subcontractorandthework
performedthereinisundertheactiveorpersonalsupervisionbyorforthelatter.210
Section 2, Department Order No. 5 [Rule XIV, Book III, Rules to Implement the Labor Code].
Id..
Id..
211 Article 82, Labor Code
212 Section 2, Department Order No. 5 [Rule XIV, Book III, Rules to Implement the Labor Code].
213 Section 2, Department Order No. 5 [Rule XIV, Book III, Rules to Implement the Labor Code].
208
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210
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assistthehomeworkersinthemaintenanceofbasicsafeandhealthfulworkingconditionsatthehomeworkersplaceof
work.214
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b.Paymentforhomework.
Immediatelyuponreceiptofthefinishedgoodsorarticles,theemployerisrequiredtopaythehomeworkeror
the contractor or subcontractor, as the case may be, for the work performed less the corresponding homeworkers
shareofSSS,PhilHealthandECCpremiumcontributionswhichshouldberemittedbythecontractororsubcontractoror
employertotheSSSwiththeemployersshare.However,wherepaymentismadetoacontractororsubcontractor,the
homeworkershouldlikewisebepaidimmediatelyafterthegoodsorarticleshavebeencollectedfromtheworkers.215
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c.Prohibitionsoncertainkindsofhomework.
Nohomeworkshallbeperformedonthefollowing:
1.Explosives,fireworksandarticlesoflikecharacter;
2.Drugsandpoisons;and
3.otherarticles,theprocessingofwhichrequiresexposuretotoxicsubstances.216
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3.CONDITIONSFORDEDUCTIONFROMHOMEWORKERSEARNINGS.
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Thefollowingarethedistinctions:
1. Practicaltraining.Bothlearnershipandapprenticeshipinvolvepracticaltrainingonthejob.
2. Trainingagreement.Learnershipisgovernedbyalearnershipagreement;whileapprenticeshipisgoverned
byanapprenticeshipagreement.
2. Occupation. Learnership involves learnable occupations consisting of semiskilled and other industrial
occupations which are nonapprenticeable; while apprenticeship concerns apprenticeable occupations or
anytrade,formofemploymentoroccupationapprovedforapprenticeshipbytheDOLESecretary.
3. Theoreticalinstructions.Learnershipmayormaynotbesupplementedbyrelatedtheoreticalinstructions;
whileapprenticeshipshouldalwaysbesupplementedbyrelatedtheoreticalinstructions.
4. Ratio of theoretical instructions and onthejob training. For both learnership and apprenticeship, the
normalratioisonehundred(100)hoursoftheoreticalinstructionsforeverytwothousand(2,000)hoursof
practical or onthejob training. Theoretical instruction time for occupations requiring less than two
thousand(2,000)hoursforproficiencyshouldbecomputedonthebasisofsuchratio.218
5. Competencybasedsystem.Unlikeinapprenticeship,itisrequired219inlearnershipthatitbeimplemented
basedontheTESDAapprovedcompetencybasedsystem.220
6. Durationoftraining.Learnershipinvolvespracticaltrainingonthejobforaperiodnotexceedingthree(3)
months;whileapprenticeshiprequiresforproficiency,morethanthree(3)monthsbutnotoversix(6)
months221ofpracticaltrainingonthejob.
7. Qualifications. The law does not expressly mention any qualifications for learners; while the following
qualificationsarerequiredtobemetbyapprenticesunderArticle59oftheLaborCode:
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RelevantProvisions:1.ApprenticescoveredbyArticles57to72,LaborCode
2.LearnerscoveredbyArticles73to77,LaborCode
3.RepublicActNo.7796(TechnicalEducationandSkills
DevelopmentActof1994)anditsImplementingRulesand
Regulations
1.DISTINCTIONSBETWEENLEARNERSHIPANDAPPRENTICESHIP.
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C. LABOR STANDARDS
12. Apprentices and Learners
a. Distinctions between Learnership
and Apprenticeship
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a.Deductionsforlost,destroyed,soiledordamagedmaterials.
Noemployer,contractororsubcontractorshallmakeanydeductionfromthehomeworkersearningsforthe
valueofmaterialswhichhavebeenlost,destroyed,soiledorotherwisedamagedunlessthefollowingconditionsare
met:
a. Thehomeworkerconcernedisclearlyshowntoberesponsibleforthelossordamage;
b. Thehomeworkerisgivenreasonableopportunitytoshowcausewhydeductionshouldnotbemade;
c. Theamountofsuchdeductionisfairandreasonableandshallnotexceedtheactuallossordamage;and
d. Thedeductionismadeatsuchratethattheamountdeducteddoesnotexceedtwentypercent(20%)ofthe
homeworkersearningsinaweek.217
Section 6, Ibid..
Section 8, Ibid..
218 Section 28, Rule VI, Book II, Ibid..
219 Under the 2004 TESDA Revised Guidelines in the Implementation of Apprenticeship and Learnership Programs.
220 No. 1.2., TESDA Circular No. 16, Series of 2004, dated August 12, 2004.
221 DOLE Circular No. 2, Series of 2006, [Amending Certain Provisions of Department Order No. 68-04] issued on August 11, 2006 by former DOLE Secretary (now Associate Justice of the Supreme Court) Arturo D. Brion
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C. LABOR STANDARDS
13. Handicapped Workers (RA 7277)
a. Definition of handicapped workers
b. Rights of disabled workers
c. Prohibitions on discrimination
against disabled persons
d. Incentives for employers
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(a) Beatleastfourteen(14)yearsofage;
(b) Possessvocationalaptitudeandcapacityforappropriatetests;and
(c) Possesstheabilitytocomprehendandfolloworalandwritteninstructions.
8. Circumstancesjustifyinghiringoftrainees.Unlikeinapprenticeship,inlearnership,thelaw,Article74of
theLaborCode,expresslyprescribestheprerequisitesbeforelearnersmaybevalidlyemployed,towit:
a.Whennoexperiencedworkersareavailable;
b. Theemploymentoflearnersisnecessarytopreventcurtailmentofemploymentopportunities;and
c.Theemploymentdoesnotcreateunfaircompetitionintermsoflaborcostsorimpairorlowerworking
standards.222
9. Limitationonthenumberoftrainees.Inlearnership,aparticipatingenterpriseisallowedtotakeinlearners
onlyuptoamaximumoftwentypercent(20%)ofitstotalregularworkforce.223Nosimilarcapisimposedin
thecaseofapprenticeship.
10. Option to employ. In learnership, the enterprise is obliged to hire the learner after the lapse of the
learnershipperiod;whileinapprenticeship,theenterpriseisgivenonlyanoptiontohiretheapprentice
asanemployee.224
11 Wage rate. The wage rate of a learner or an apprentice is set at seventyfive percent (75%) of the
statutoryminimumwage.225
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1.DEFINITIONOFHANDICAPPEDWORKERS(UNDERR.A.NO.7277).
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b.Definitionofimportantterms.
Thefollowingtermsarespecificallydefinedinthelaw:
1.PersonswithDisabilityarethosesufferingfromrestrictionordifferentabilities,asaresultofamental,
physicalorsensoryimpairment,toperformanactivityinthemannerorwithintherangeconsiderednormal
forahumanbeing.
2. Impairment refers to any loss, diminution or aberration of psychological, physiological, or anatomical
structureorfunction.
3. Disabilitymeans(1)aphysicalormentalimpairmentthatsubstantiallylimitsoneormorepsychological,
physiologicaloranatomicalfunctionsofanindividualoractivitiesofsuchindividual;(2)arecordofsuchan
impairment;or(3)beingregardedashavingsuchanimpairment.
4. Handicapreferstoadisadvantageforagivenindividual,resultingfromanimpairmentoradisabilitythat
limitsorpreventsthefunctionoractivitythatisconsiderednormalgiventheageandsexoftheindividual.
5. ReasonableAccommodationsinclude:(1)improvementofexistingfacilitiesusedbyemployeesinorder
to render these readily accessible to and usable by persons with disability; and (2) modification of work
schedules, reassignment to a vacant position, acquisition or modification of equipment or devices,
appropriateadjustmentsormodificationsofexaminations,trainingmaterialsorcompanypolicies,rulesand
regulations,theprovisionofauxiliaryaidsandservices,andothersimilaraccommodationsforpersonswith
disability.
6. MarginalizedDisabledPersonsormoreappropriately,MarginalizedPersonswithDisabilityreferto
personswithdisabilitywholackaccesstorehabilitativeservicesandopportunitiestobeabletoparticipate
fullyinsocioeconomicactivitiesandwhohavenomeansoflivelihoodandwhoseincomesfallbelowthe
povertythreshold.
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a.Importantclarificationofterms.
Thetermhandicappedworkersshouldnolongerbeusedtodescribepersonswithdisabilityasthisisno
longerlegallycorrect.Handicappedpersonsshouldnotbecalleddisabledpersonsbutpersonswithdisability.The
termdisabledpersonshasbeenchangedtopersonswithdisabilitynotonlyinthetitleofR.A.No.7277butinall
referencesinthesaidlawtodisabledpersonsbyvirtueofR.A.No.9442.
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RelevantProvisions:HandicappedworkerscoveredbyArticles78to81,LaborCode
R.A.No.7277[March24,1992](MagnaCartaforDisabledPersons)[nowtobeknownas
MagnaCartaforPersonswithDisabilityperSection4ofR.A.No.9442(effectiveApril30,2007)],
See also Section 2, Rule VII, Book II, Rules to Implement the Labor Code.
No. 3.7., Ibid..
See No. 3.10 of TESDA Circular No. 16, Series of 2004 and DOLE Circular No. 2, Series of 2006.
225 Section 29, Rule VI, Book II, Ibid.; Section 5, Republic Act No. 6640; Section 10, Rules Implementing Republic Act No. 6640; Section 10, Rules Implementing Republic Act No. 6727; No. I [H], DOLE Handbook on Workers Statutory Monetary Benefits; No. 3.8., TESDA Circular No. 16,
Series of 2004, dated August 12, 2004 [Revised Guidelines in the Implementation of Apprenticeship and Learnership Programs].
222
223
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7. Qualified Individual with a Disability means an individual with a disability who, with or without
reasonable accommodations, can perform the essential functions of the employment position that such
individualholdsordesires.However,considerationshallbegiventotheemployersjudgmentastowhat
functionsofajobareessential,andifanemployerhaspreparedawrittendescriptionbeforeadvertisingor
interviewingapplicantsforthejob,thisdescriptionshallbeconsideredevidenceoftheessentialfunctions
ofthejob.
8. CoveredEntitymeansanemployer,employmentagency,labororganizationorjointlabormanagement
committee.
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2.RIGHTSOFPERSONSWITHDISABILITY(DISABLEDWORKERS).
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a.Equalopportunityforpersonswithdisability.
Underthelaw,226personswithdisabilityareentitledtoequalopportunityforemployment.Consequently,no
person with disability shall be denied access to opportunities for suitable employment. A qualified employee with
disability shall be subject to the same terms and conditions of employment and the same compensation, privileges,
benefits,fringebenefits,incentivesorallowancesasaqualifiedablebodiedperson.
Fivepercent(5%)ofallcasualemergencyandcontractualpositionsintheDepartmentsofSocialWelfareand
Development,Health,Educationandothergovernmentagencies,officesorcorporationsengagedinsocialdevelopment
shallbereservedforpersonswithdisability.227
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d.Vocationalguidanceandcounselling.
TheDSWDshallimplementmeasuresprovidingandevaluatingvocationalguidanceandcounsellingtoenable
persons with disability to secure, retain and advance in employment. It shall ensure the availability and training of
counsellorsandothersuitablyqualifiedstaffresponsibleforthevocationalguidanceandcounsellingofpersonswith
disability.230
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e.Personswithdisabilityareeligibleforapprenticeshipandlearnership.
UnderR.A.No.7277,231itisprovidedthatsubjecttotheprovisionsoftheLaborCode,asamended,persons
withdisabilityshallbeeligibleasapprenticesorlearners;providedthattheirhandicapisnotasmuchastoeffectively
impedetheperformanceofjoboperationsintheparticularoccupationforwhichtheyarehiredandprovidedfurther
thatafterthelapseoftheperiodofapprenticeship,iffoundsatisfactoryinthejobperformance,theyshallbeeligiblefor
employment.
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f.Wagerate.
UnderArticle80oftheLaborCode,handicappedworkersareentitledtonotlessthanseventyfivepercent
(75%)oftheapplicableadjustedminimumwage.232
In view, however, of R.A. No. 7277,233 the wage rate of persons with disability is 100% of the applicable
minimumwage.
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c.Vocationalrehabilitation.
Consistentwiththeprincipleofequalopportunityforworkerswithdisabilityandworkersingeneral,theState
shalltakeappropriatevocationalrehabilitationmeasuresthatshallservetodeveloptheskillsandpotentialsofpersons
with disability and enable them to compete favorably for available productive and remunerative employment
opportunitiesinthelabormarket.
TheStateshallalsotakemeasurestoensuretheprovisionofvocationalrehabilitationandlivelihoodservices
forpersonswithdisabilityintheruralareas.Inaddition,itshallpromotecooperationandcoordinationbetweenthe
government and nongovernmental organizations and other private entities engaged in vocational rehabilitation
activities.
The Department of Social Welfare and Development (DSWD) shall design and implement training programs
thatwillprovidepersonswithdisabilitywithvocationalskillstoenablethemtoengageinlivelihoodactivitiesorobtain
gainful employment. The Department of Labor and Employment (DOLE) shall likewise design and conduct training
programsgearedtowardsprovidingpersonswithdisabilitywithskillsforlivelihood.229
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b.Shelteredemploymentforpersonswithdisability.
Sheltered Employment refers to the provision of productive work for persons with disability through
workshopsprovidingspecialfacilities,incomeproducingprojectsorhomeworkschemeswithaviewtogivingthemthe
opportunitytoearnalivingthusenablingthemtoacquireaworkingcapacityrequiredinopenindustry.
Ifsuitableemploymentforpersonswithdisabilitycannotbefoundthroughopenemployment,theStateshall
endeavor to provide it by means of sheltered employment. In the placement of persons with disability in sheltered
employment,itshallaccorddueregardtotheindividualqualities,vocationalgoalsandinclinationstoensureagood
workingatmosphereandefficientproduction.228
Under R.A. No. 7277, otherwise known as the Magna Carta for Disabled Persons [now known as Magna Carta for Persons with Disability].
Section 5, Chapter 1, Title II, Republic Act No. 7277.
Section 6, Chapter 1, Title II, Ibid..
Section 9, Chapter 1, Title II, Ibid..
230 Section 10, Chapter 1, Title II, Ibid..
231 Section 7, Chapter I, Title II thereof.
232 Article 80 [b], Labor Code; Section 5, Republic Act No. 6640; Section 10, Rules Implementing Republic Act No. 6640; Section 10, Rules Implementing Republic Act No. 6727; No. I [H], DOLE Handbook on Workers Statutory Monetary Benefits.
233 Section 5, Chapter 1, Title II of R.A. No. 7277.
226
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228
229
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WageordersissuedbytheRegionalTripartiteWagesandProductivityBoards(RTWPBs)normallyreflectthis
principle.Tociteanexample,Section7ofWageOrderNo.NCR15[effectiveJuly01,2010]issuedbyRTWPBNational
CapitalRegionstates:
Allqualifiedhandicappedworkersshallreceivethefullamountoftheminimumwagerate
prescribed herein pursuant to Republic Act No. 7277, otherwise known as the Magna Carta for
DisabledPersons.234
Moreover,incaseoflegallymandatedwageincreasesenunciatedinwageordersissuedbytheRTWPBs,the
employmentagreementswithpersonswithdisabilityaredeemedautomaticallymodifiedinsofarastheirwageclauses
areconcernedtoreflectthesaidincreases.235
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g.Wagerateasapprenticeorlearner.
Apersonwithdisabilityhiredasanapprenticeorlearnershallbepaidnotlessthanseventyfivepercent(75%)
oftheapplicableminimumwage.
Ifthepersonwithdisability,however,ishiredasalearnerandemployedinpieceorincentiveratejobsduring
thetrainingperiod,heshallbepaidonehundredpercent(100%)oftheapplicableminimumwage.
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a.Incentivesforemployerswhoemploypersonswithdisability.
Toencouragetheactiveparticipationoftheprivatesectorinpromotingthewelfareofpersonswithdisability
andtoensuregainfulemploymentforqualifiedpersonswithdisability,adequateincentivesshallbeprovidedtoprivate
entitieswhichemploypersonswithdisability.237
Privateentitiesthatemploypersonswithdisabilitywhomeettherequiredskillsorqualifications,eitherasa
regularemployee,apprenticeorlearner,shallbeentitledtoanadditionaldeductionfromtheirgrossincomeequivalent
to twentyfive percent (25%) of the total amount paid as salaries and wages to persons with disability; provided,
however,thatsuchentitiescouldpresentproofascertifiedbytheDepartmentofLaborandEmploymentthatpersons
with disability are under their employ and provided further that the employee with disability is accredited with the
DepartmentofLaborandEmploymentandtheDepartmentofHealthastohisdisability,skillsandqualifications.238
Privateentitiesthatimproveormodifytheirphysicalfacilitiesinordertoprovidereasonableaccommodation
forpersonswithdisabilityshallalsobeentitledtoanadditionaldeductionfromtheirnettaxableincomeequivalentto
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a.Discriminationonemploymentprohibited.
Noentity,whetherpublicorprivate,shalldiscriminateagainstaqualifiedpersonwithdisabilitybyreasonof
disability in regard to job application procedures, the hiring, promotion, or discharge of employees, employee
compensation,jobtraining,andotherterms,conditionsandprivilegesofemployment.Thefollowingconstituteactsof
discrimination:
(a) Limiting,segregatingorclassifyingajobapplicantwithdisabilityinsuchamannerthatadverselyaffectshis
workopportunities;
(b) Using qualification standards, employment tests or other selection criteria that screen out or tend to
screenoutapersonwithdisabilityunlesssuchstandards,testsorotherselectioncriteriaareshowntobe
jobrelatedforthepositioninquestionandareconsistentwithbusinessnecessity;
(c) Utilizingstandards,criteria,ormethodsofadministrationthat:
(1) havetheeffectofdiscriminationonthebasisofdisability;or
(2) perpetuatethediscriminationofotherswhoaresubjecttocommonadministrativecontrol.
(d) Providinglesscompensation,suchassalary,wageorotherformsofremunerationandfringebenefits,toa
qualifiedemployeewithdisability,byreasonofhisdisability,thantheamounttowhichanondisabled
personperformingthesameworkisentitled;
(e) Favoring anondisabled employeeoveraqualifiedemployee withdisability with respecttopromotion,
trainingopportunities,studyandscholarshipgrants,solelyonaccountofthelattersdisability;
(f) Reassigningortransferringanemployeewithadisabilitytoajoborpositionhecannotperformbyreason
ofhisdisability;
(g) Dismissingorterminatingtheservicesofanemployeewithdisabilitybyreasonofhisdisabilityunlessthe
employercanprovethatheimpairsthesatisfactoryperformanceoftheworkinvolvedtotheprejudiceof
the business entity; provided, however, that the employer first sought to provide reasonable
accommodationsforpersonswithdisability;
(h) Failingtoselectoradministerinthemosteffectivemanneremploymenttestswhichaccuratelyreflectthe
skills, aptitude or other factor of the applicant or employee with disability that such tests purports to
measure,ratherthantheimpairedsensory,manualorspeakingskillsofsuchapplicantoremployee,ifany;
and
(i) Excludingpersonswithdisabilityfrommembershipinlaborunionsorsimilarorganizations.236
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3.PROHIBITIONSONDISCRIMINATIONAGAINSTPERSONSWITHDISABILITY(DISABLEDPERSONS).
See also Section 8, Rule II, Implementing Rules of Wage Order No. NCR-14 issued on June 18, 2010.
Article 124, Labor Code as amended by Section 3, Republic Act No. 6727; Section 10, Rules Implementing Republic Act No. 6727; Section 5, Republic Act No. 6640; Section 10, Rules Implementing Republic Act No. 6640 [applying by analogy similar provisions applicable to
apprenticeship and learnership agreements mentioned therein].
236 Section 32, Chapter I, Title III, Ibid..
237 Section 8[a], Chapter 1, Title II, Ibid..
238 Section 8[b], Chapter 1, Title II, Ibid.
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fiftypercent(50%)ofthedirectcostsoftheimprovementsormodifications.ThisSection,however,doesnotapplyto
improvementsormodificationsoffacilitiesrequiredunderBatasPambansaBilang344[February25,1983],entitledAn
ActtoEnhancetheMobilityofDisabledPersonsbyRequiringCertainBuildings,Institutions,Establishments,andPublic
UtilitiestoInstallFacilitiesandOtherDevices.239
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END OF DISCUSSION ON
TOPIC C. LABOR STANDARDS
239
Section 8[c], Chapter 1, Title II, Ibid..
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TOPICS UNDER THE SYLLABUS

a. Service Incentive Leave Pay

a. Right to holiday pay

a. Right to weekly rest day

a. No work no pay principle

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11. Employment of Homeworkers

12. Apprentices and Learners

13. Handicapped Workers (RA 7277)

a. Distinctions between Learnership and Apprenticeship

a. Definition of handicapped workers

10. Employment of Househelpers

a. Regulation of working hours of a child

9. Minor Workers (RA 7678, RA 9231)

a. Discrimination (Art. 135, LC)

7. Thirteenth (13th) Month Pay and other bonuses

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travel time, whether part of hours of work or not

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Policy Instructions No. 36, May 22, 1978.

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Section 5 [a], Rule I, Book III, Ibid..

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No. III, DOLE Handbook on Workers Statutory Monetary Benefits.

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No. IV, Ibid..

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No. IV [D], DOLE Handbook on Workers Statutory Monetary Benefits.

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LABOR LAW: C. LABOR STANDARDS

Section 1. ORGANIZED ESTABLISHMENTS. Wage increases granted by an employer in an organized establishment

Section 2. UNORGANIZED ESTABLISHMENTS. In unorganized establishments, wage increases granted by the

ChanRobles Internet Bar Review : ChanRobles Professional Review, Inc.

LABOR LAW: C. LABOR STANDARDS

ChanRobles Internet Bar Review : ChanRobles Professional Review, Inc.

LABOR LAW: C. LABOR STANDARDS

As amended by Section 1 of R.A. No. 6715 [March 21, 1989].

ChanRobles Internet Bar Review : ChanRobles Professional Review, Inc.

LABOR LAW: C. LABOR STANDARDS

ChanRobles Internet Bar Review : ChanRobles Professional Review, Inc.

LABOR LAW: C. LABOR STANDARDS