Labor Concepts

Voluntary retirement cuts the employment ties leaving no residual liability to

other
Involuntary retirement amounts to discharge rendering employer liable.
Overtime work- Additional compensation equivalent to his regular wage plus at
least twenty-five percent thereof. Work performed beyond eight hours on a holiday
or rest day shall be an additional equivalent to the rate of the first eight hours a
day or rest plus at least 30% thereof.
If the work performed was necessary, or it benefited the employer, or the employee
could not abandon his *work at the end of his normal working hours because he had
no replacement, all time spent for such work shall be considered as hours worked, if
the work was with the knowledge of his employer or immediate supervisor.
MANAGERIAL EMPLOYEE- primary duty is to managed the establishment in which
they are employed, or the subdivisions or officers thereof, or other off ices and
employers of the managerial staff.
Field employee- Non agricultural employees who regularly perform their work
away from the principal place of business or branch office of the employers and
whose actual hours of work in the field cannot be determined with reasonable
certainty.
Pakyaw or task basis engagement- non-consideration of the time spent in
working. Payment is reckoned in terms of completion of the work, not in terms of
the number of time spent in the completion of work. Once the work or task is
completed, the worker receives a fixed amount as wage, without regard to the
standard measurements of time generally used in pay computation.
Constructive dismissal- Involuntary resignation resulting in cessation of work
resorted to when continued employment becomes impossible, unreasonable and
unlikely; when there is a demotion in rank or a diminution in pay; or when a clear
discrimination, insensibility or disdain by an employer becomes unbearable to the
employess
Commission based- Certain percentaage
Ostensible Agency- The implied manifestation of hospitals that the doctors are their
employees. The Reliance of patients to hospital and doctors, consistent with
ordinary care and prudence.
Managerial employee- One who is vested with the powers or prerogatives to lay
down and execute management policies or to hire, transfer, suspend lay-off, recall,
discharge, assign or discipline employees. (H, T, S, L, R, D, A, D)
Supervisory- Those who, in the interest of the employer, effectively recommend
such managerial actions if the exercise of such authority is not merely routinary or
clerical in nature but requires the use of independent judgment.
Rank-and-file- All employees not falling within any of the above definitions.

Why undertime cannot be offset by overtime?

-Employee will lose more. In overtime theres always additional compensation. They
will be shortchanged
Regular employee- usually necessary or desirable in the usual business or trade of
the employer
Project employee- Fixed for a specific project or undertaking the completion or
termination of which has been determined at the time of the engagement of the
employee or where the work or services to be performed is seasonal in nature and
the employment is for the duration of the season.
Casual if it is not covered by the proceeding paragraph:
Provided, That, any employee who has rendered at least one year of service,
whether such service is continuous or broken, shall be considered a regular
employee with respect to the activity in which he is employed and his employment
shall continue while such activity exists.
An independent contractor- one who undertakes "job contracting", i.e., a person
who
(a) carries on an independent business and undertakes the contract work on his
own account under his own responsibility according to his own manner and method,
free from the control and direction of his employer or principal in all matters
connected with the performance of the work except as to the results thereof, and
(b) has substantial capital or investment in the form of tools, equipment,
machineries, work premises, and other materials which are necessary in the
conduct of the business]
Labor contracts are not enforceable against the transferee of an enterprisw

Basis of the 13-month pay computation

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The Revised Implementing Guidelines of the 13 th-Month Pay Law provides that
an employee shall be entitled to not less than 1/12 of the basic salary earned
within a calendar year for the purpose of computing such entitlement. The
basic wage shall include:
All remunerations or earnings paid by his employer for services rendered but
do not include allowances or monetary benefits which are not considered or
integrated as part of the regular or basic salary, such as the cash equivalent
of unused vacation and sick leave credits, overtime premium, night shift
differential holiday pay, cost-of-living allowances. However, these salaryrelated benefits should be included as part of the basic salary in the
computation of the 13th month pay if by individual or collective agreement,
company practice or policy, the same are treated as part of the basic salary
of the employees.

Basic Wage
-

All remuneration of earnings paid by an employer to a worker for services

rendered on normal working days and hours but does not include cost of
living allowances, 13th month pay or other monetary benefits which are not
considered as part of or integrated into the regular salary of the workers

Compensations deemed not part of the basic salary:

1. Cost-of-living allowance
2. Profit sharing payments
3. All allowances and monetary benefits which are not considered or integrated
as part of the rergular basic salar of the employees at the time of the
promulgation of the decree

Overload work/pay
-

The load in excess of the normal load of private school teachers

Gross negligence- want or absence of or failure to exercise slight care or

diligence, or the entire absence of care. It evinces a thoughtless disregard of

consequences without exerting any effort to avoid them. On the other hand, the
basic premise for dismissal on the ground of loss of confidence is that the
employees concerned hold a position of trust and confidence. It is the breach of
this trust that results in the employers loss of confidence in the employee.

1.
2.

3.

4.
5.

Installation of labor-saving devices. The installation of labor-saving

devices contemplates the installation of machinery to effect economy and efficiency in the
method of production[1].
Redundancy. Redundancy exists where the services of an employee are in excess of
what is reasonably demanded by the actual requirements of the enterprise. A position is
redundant where it superfluous, and superfluity of a position or positions may be the
outcome of a number of factors, such as over hiring of workers, decreased of volume
business, or dropping of a particular product line or service activity previously manufactured
or undertaken by the enterprise[2].
Retrenchment to prevent losses. Retrenchment is an economic ground to reduce
the number of employees. Retrenchment is the reduction of personnel for the purpose of
cutting down on costs of operations in terms of salaries and wages resorted to by an
employer because of losses in operation of a business occasioned by lack of work and
considerable reduction in the volume of business[3]. It is sometimes also referred to as
downsizing. It is aimed at saving a financially ailing business establishment from eventually
collapsing.
Closure or cessation of operation. The closure of a business establishment is a
ground for the termination of the services of an employee unless the closing is for the
purpose of circumventing pertinent provisions of the Labor Code.
Disease. An employer may terminate the services of an employee who has been
found to be suffering from any disease and whose continued employment is prohibited by
law or is prejudicial to his health as well as the health of his co-employees.
It should be noted though that the above enumeration is not an exhaustive list of authorized
causes of termination of employment. Valid application of union security clause, relocation of
business, among others, may also considered authorized causes of termination
Voluntary resignation
1) Intention of relinquishing
2) Coupled with an act of relinquishment

3)