I

A.
What are the accepted tests to determine the existence of an employer-employee
relationship? (5%)
SUGGESTED ANSWER:
The four elements of an employment relationship are: (a) the selection and engagement of
the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer’s
power to control the employee’s conduct. (Lakas sa Industriya ng Kapatirang Haligi ng
Alyansa-Pinagbuklod ng Manggagawang Promo ng Burlingame v. Burlingame Corporation,
G.R. No. 162833, June 15, 2007, 524 SCRA 690, 695, citing Sy v. Court of Appeals, 398 SCRA 301,
307-308 (2003); Pacific Consultants International Asia, Inc. v. Schonfeld, G.R. No. 166920,
February 19, 2007, 516 SCRA 209, 228)
NOTE: The foregoing answer in can be found in page 332 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The
topic on employer-employee relation has been time and again the subject matter of bar
questions, more specifically during the 2016, 2014, 2012, 2011, 2010, 2008, 2002, 1996 and 1991
Bar Examinations.

B.
Applying the tests to determine the existence of an employer-employee relationship, is a
jeepney driver operating under the boundary system an employee of his jeepney operator or
a mere lessee of the jeepney? Explain your answer. (3%)
SUGGESTED ANSWER:
In a number of cases decided by the Supreme Court, (National Labor Union vs. Dinglasan, 98
Phil. 649, 652 (1996); Magboo vs. Bernardo, 7 SCRA 952, 954 (1963); Lantaco, Sr. vs. Llamas,
108 SCRA 502, 514 [1981]), it was ruled that the relationship between jeepney
owners/operators on one hand and jeepney drivers on the other under the boundary system
is that of employer-employee and not of lessor-lessee. It was explained that in the lease of
chattels, the lessor loses complete control over the chattel leased although the lessee cannot
be reckless in the use thereof, otherwise he would be responsible for the damages to the
lessor. In the case of jeepney owners/operators and jeepney drivers, the former exercise
supervision and control over the latter. The management of the business is in the owner’s
hands. The owner as holder of the certificate of public convenience must see to it that the
driver follows the route prescribed by the franchising authority and the rules promulgated as
regards its operation. Now, the fact that the drivers do not receive fixed wages but get only
that in excess of the so-called “boundary” they pay to the owner/operator is not sufficient to
withdraw the relationship between them from that of employer and employee.
NOTE: The foregoing answer in can be found in pages 341-342 of the book entitled Principles
and Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano.
The topic on employer-employee relation has been time and again the subject matter of bar

1
questions, more specifically during the 2016, 2014, 2012, 2011, 2010, 2008, 2002, 1996 and 1991
Bar Examinations.

II.
Procopio was dismissed from employment for stealing his co-employee Raul’s watch.
Procopio filed a complaint for illegal dismissal. The Labor Arbiter ruled in Procopio’s favor on
the ground that Raul’s testimony was doubtful, and, therefore, the doubt should be resolved
in favor of Procopio. On appeal, the NLRC reversed the ruling because Article 4 of the Labor
Code – which states that all doubts in the interpretation and implementation of the provisions
of the Labor Code, including the implementing rules and regulations, shall be resolved in favor
of labor – applied only when the doubt involved the “implementation and interpretation” of
the Labor Code; hence, the doubt, which involved the application of the rules on evidence,
not the Labor Code, could not necessarily be resolved in favor of Procopio. Was the reversal
correct? Explain your answer. (3%)
SUGGESTED ANSWER:
In Peñaflor v. Outdoor Clothing Manufacturing, G.R. No. 177114, January 21, 2010, the Supreme
Court explained the application of Article 4 of the Labor Code regarding doubts on
respondent’s evidence on the voluntariness of petitioner’s resignation. Thus, the High Court
said:
Another basic principle is that expressed in Article 4 of the Labor Code – that all doubts in the
interpretation and implementation of the Labor Code should be interpreted in favor of the
workingman. This principle has been extended by jurisprudence to cover doubts in the
evidence presented by the employer and the employee. (Fujitsu Computer Products
Corporation of the Philippines v. Court of Appeals, 494 Phil. 697 [2005]) As shown above,
Peñaflor has, at very least, shown serious doubts about the merits of the company’s case,
particularly in the appreciation of the clinching evidence on which the NLRC and CA decisions
were based. In such contest of evidence, the cited Article 4 compels us to rule in Peñaflor’s
favor. Thus, we find that Peñaflor was constructively dismissed given the hostile and
discriminatory working environment he found himself in, particularly evidenced by the
escalating acts of unfairness against him that culminated in the appointment of another HRD
manager without any prior notice to him. Where no less than the company’s chief corporate
officer was against him, Peñaflor had no alternative but to resign from his employment.
(Unicorm Safety Glass, Inc. v. Basarte, 486 Phil. 493 [2004])
NOTE: The foregoing answer in can be found in page 30 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The
topic on Article 4 regarding the application of Article 4 on doubts in the evidence was asked
last 2009 Bar Examination.
III.
A.
Andrew Manning Agency (AMA) recruited Feliciano for employment by Invictus Shipping, its
foreign principal. Meantime, AMA and Invictus Shipping terminated their agency agreement.

2
Upon his repatriation following his premature termination, Feliciano claimed from AMA and
Invictus Shipping the payment of his salaries and benefits for the unserved portion of the
contract. AMA denied liability on the ground that it no longer had any agency agreement with
Invictus Shipping. Is AMA correct? Explain your answer. (3%)
SUGGESTED ANSWER:
AMA is not correct. Section 10 of Republic Act 10022 provides that the liability of the
principal/employer and the recruitment/placement agency for any and all claims shall be joint
and several. This provision shall be incorporated in the contract for overseas employment and
shall be a condition precedent for its approval. Such liabilities shall continue during the entire
period or duration of the employment contract and shall not be affected by any substitution,
amendment or modification made locally or in a foreign country of the said contract.
NOTE: The foregoing answer in can be found in page 675 of the book entitled Principles and
Cases Labor Relations, First Edition 2016, by Atty. Voltaire T. Duano.

B.
As a rule, direct hiring of migrant workers is not allowed. What are the exceptions? Explain
your answer. (2.5%)
SUGGESTED ANSWER:
Direct Hires — workers directly hired by employers for overseas employment as authorized
by the Secretary of Labor and Employment and processed by the POEA, including:
1. Those hired by international organizations
2. Those hired members of the diplomatic corps.
3. Name hires or workers who are able to secure overseas employment opportunity with an
employer without the assistance or participation of any agency. [Labor Code, POEA Rules]
(Section 1(i), Rule II, Omnibus Rules and Regulations Implementing The Migrant Workers and
Overseas Filipinos Act of 1995 as amended by Republic Act No. 10022)
The direct hires are exceptions to the ban on direct-hiring under Article 18 of the Labor Code.
NOTE: The foregoing answer in can be found in page 112 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The
topic on direct hiring was asked last 2010 Bar Examination.

C.
Phil, a resident alien, sought employment in the Philippines. The employer, noticing that Phil
was a foreigner, demanded that eh first secures an employment permit from the DOLE. Is the
employer correct? Explain your answer. (2.5%)
SUGGESTED ANSWER:
The employer is not correct. According to Section 2, Department Order No. 97-09 Series of
2009, issued on August 26, 2009 [Revised Rules for the Issuance of Employment Permits to
Foreign Nationals]one of the foreign nationals that are exempt from securing an employment

3
permit is a permanent permanent resident foreign nationals, probationary or temporary visa
holders. Moreover, the Labor Code speaks of non-resident aliens that are required to obtain
an alien employment permit.
NOTE: The foregoing answer can be found in pages 270 and 271 of the book entitled Principles
and Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano.
The topic on alien employment permit has been time and again the subject matter of bar
questions, more specifically during the 2007 and 1995 Bar Examinations.

IV
The Regional Tripartite and Productivity Board (RTWPB) for Region 3 issued a wage order on
November 2, 2017 fixing the minimum wages for all industries throughout Region 3.

(a) Is the wage order subject to the approval of the National Wages and Productivity
Commission before it takes effect? (2%)
SUGGESTED ANSWER:
No. the National Wages and Productivity Commission function is to review the Wage Order
issued by the Regional Tripartite and Productivity Board (RTWPB) (See Section 4, Rule IV,
NWPC GUIDELINES NO. 01 Series of 2007, dated June 19, 2007)
NOTE: The foregoing answer can be found in page 558 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano.

(b) The law mandates that no petition for wage increase shall be entertained within a period
of 12 months from the effectivity of the wage order. Under what circumstances may the
Kilusang Walang Takot, a federation of labor organizations that publicly and openly assails the
wage order as blatantly unjust, initiate the review of the wage increases under the wage order
without waiting for the end of the 12-month period? Explain your answer. (3%)

SUGGESTED ANSWER:
If Kilusang Walang Takot feels aggrieved by the Wage Order issued by the Board it may appeal
such Order to the National Wages and Productivity Commission by filing a verified appeal with
the Board not later than ten (10) days from the date of publication of the Order on the grounds
of non-conformity with prescribed guidelines and/or procedures, questions of law and grave
abuse of discretion. (See Section 1, Rule IV, in relation to Section 2 Rule V, NWPC GUIDELINES
NO. 01 Series of 2007, dated June 19, 2007)
NOTE: The foregoing answer can be found in pages 559-560 of the book entitled Principles
and Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano.

4
 V
A.
Percival was a mechanic of Pacific Airlines. He enjoyed a meal break of one hour. However,
during meal breaks, he was required to be on stand-by for emergency work. During
emergencies, he was made to forego his meals or to hurry up eating. He demanded payment
of overtime for work done during his meal periods. Is Percival correct? Explain your answer.
(3%)

SUGGESTED ANSWER:
Percival is correct. While as a rule the eight hour period does not include the meal break
however, in the case of Percival he was required to forego his meals or to hurry up eating. The
meal period should therefore be considered compensable hours of work and a work beyond
eight hours. Percival is therefore entitled to overtime time.
NOTE: The foregoing answer can be found in page 371 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano.

B.
Distinguish a learner from an apprentice. (4%)

SUGGESTED ANSWER:
As to the agreement

In Apprenticeship, the agreement entered by the parties is known as Apprenticeship

Agreement. (Articles 58 [d], Labor Code); In learnership, the agreement entered by the parties
is known as Learnership Agreement (Article 75, Labor Code);

As to the period of agreement

In Apprenticeship, the agreement shall not be less than four (4) months and not more than
six (6) months; (Articles 58 [c] in relation to Article 61 and 3.10, TESDA Circular No. 16, Series
of 2004); In learnership, the agreement period shall not be more than three (3) months;
(Article 75 (c), Labor Code, 3.10, TESDA Circular No. 16, Series of 2004);

As to obligations to hire

In apprenticeship, the enterprise is not obliged to hire the apprentice after the apprenticeship
period; (Articles 61, Labor Code, 3.10, TESDA Circular No. 16, Series of 2004); In learnership,

5
the enterprise is obliged to hire the learner after the learnership period (Article 75 (d), Labor
Code, 3.10, TESDA Circular No. 16, Series of 2004);

As to pre-termination of the agreement

In apprenticeship, upon pre-termination of the agreement there is no regular employment by

operation of law; (Articles 57-72, Labor Code); In learnership, a learner allowed or suffered to
work during the first two (2) months shall be deemed regular employees if training is
terminated by the employer before the end of the stipulated period through no fault of the
learners (Article 75 (d), Labor Code);

As to the person hired

In apprenticeship, the persons hired as trainees is known as apprentice; (Articles 58 [a], Labor
Code, 2, TESDA Circular No. 16, Series of 2004); In learnership, the persons hired as trainees is
known as learner (Articles 73, Labor Code, 2, TESDA Circular No. 16, Series of 2004);

As to the supplement on theoretical instructions

In apprenticeship, the training on the job is with compulsory related theoretical instructions;
(Article 58 [a], Labor Code, Section 4 [j], R.A. 7796, and 2, TESDA Circular No. 16, Series of
2004); In learnership, the practical training on the job may or may not be supplemented by
related theoretical instructions; (2, TESDA Circular No. 16, Series of 2004);

As to the reasons for hiring

In apprenticeship, the law did not provide any reasons where an apprentice may be hired
(Articles 59-72, Labor Code); In learnership, the law provides the following reasons for hiring
(1) when no experienced workers are available; (2) the employment of learners is necessary
to prevent curtailment of employment opportunities; and (3) the employment does not
create unfair competition in terms of labor costs or impair or lower working standards (Article
74, Labor Code);

As to qualifications

In apprenticeship, the qualifications are (a) At least fifteen (15) years of age; (b) Possess
vocational aptitude and capacity for appropriate tests; and (c) Possess the ability to
comprehend and follow oral and written instructions and no justifications or reasons given by
law for hiring; (Articles 59, Labor Code); In learnership, the law did not provide such

6
qualifications. However, reasons or justifications for hiring are provided by law (Articles 74,
Labor Code);

As to what occupations hired

In apprenticeship, the occupations involves “highly technical industries” which means trade,
business, enterprise, industry, or other activity, which is engaged in the application of
advanced technology and apprenticeable occupations must be approved by TESDA; (Articles
60, Labor Code and 3.3, TESDA Circular No. 16, Series of 2004). In learnership, the occupations
involves are semi-skilled and other industrial occupations which are non-apprenticeable and
learnable occupations must be approved by TESDA (Articles 73, Labor Code and 3.3, TESDA
Circular No. 16, Series of 2004).
NOTE: The foregoing answer can be found in pages 313-314 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The
topic on the distinctions between apprentice and learner has been the subject matter of bar
questions during the 2016 and 2012 Bar Examinations.

C.
Are there differences between a househelper and a homeworker? Explain your answer?
Domestic worker or “Kasambahay” refers to any person engaged in domestic work within an
employment relationship such as, but not limited to, the following: general househelp,
nursemaid or “yaya”, cook, gardener, or laundry person while (b) “Industrial Homeworker”
means a worker who is engaged in industrial homework.
NOTE: The foregoing answer can be found in pages 676 and 712 of the book entitled Principles
and Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano.

VI.
A.
One Pacific Airline’s policies was to hire only single applicants as flight attendants, and
considered as automatically resigned the flight attendants at the moment they got married.
Is the policy valid? Explain your answer. (2.5%)

SUGGESTED ANSWER:
The policy is not valid. The policy is a violation of the Labor Code’s prohibition on stipulation
against marriage under Article 134. The requirement that a company policy must be
reasonable under the circumstances to qualify as a valid exercise of management prerogative
was also at issue in the 1997 case of Philippine Telegraph and Telephone Company v. NLRC,
G.R. No. 118978, May 23, 1997. In said case, the employee was dismissed in violation of
petitioner’s policy of disqualifying from work any woman worker who contracts marriage. The

7
Supreme held that the company policy violates the right against discrimination afforded all
women workers under Article 136 (now 134) of the Labor Code.
NOTE: The foregoing answer can be found in pages 623 and 627 of the book entitled Principles
and Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano.
The topic on stipulation against marriage has been time and again the subject matter of bar
questions, more specifically during the 2012, 2010, 1997 and 1995 Bar Examinations.

B.
Tarcisio was employed as operations manager and received a monthly salary of P25,000.00
through his payroll account with DB Bank. He obtained a loan from Roberto to purchase a car.
Tarcisio failed to pay Roberto when the loan fell due. Roberto sued to collect, and moved to
garnish Tarcisio’s payroll account. The latter vigorously objected and argued that slaries were
exempt from garnishment. Is Tarcisio correct? Explain your answer. (3%)

SUGGESTED ANSWER:
Tarciso is not correct. In Gaa v. Court of Appeals, G.R. No. L-44169 December 3, 1985, the
Supreme Court ruled that Article 1708 used the word "wages" and not "salary" in relation to
"laborer" when it declared what are to be exempted from attachment and execution. The
monthly salary of Tarcisio is therefore subject to garnishment.
NOTE: The foregoing answer can be found in page 450 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The
topic on the distinction between salary and wage has been the subject matter of bar questions
during the 1994 Bar Examination.

VII
Dr. Crisostomo entered into a retainer agreement with AB Hotel and Resort whereby he
would provide medical services to the guests and employees of AB Hoteland Resort, which,
in turn, would provide the clinic premises and medical supplies. He received a monthly retainer
fee of P60,000.00, plus a 70% share in the service charges from AB Hoteland Resort’s guests
availing themselves of the clinic’s services. The clinic employed nurses and allied staff, whose
salaries, SSS contributions and other benefits he undertook to pay. AB Hotel and Resort issued
directives giving instructions to him on the replenishment of emergency kits and forbidding
the clinic staff from receiving cash payments from guests. In time, the nurses and the clinic
staff claimed entitlement to rights as regular employees of AB Hotelnad Resort, but the latter
refused on the ground that Dr. Crisostomo, who was their employer, was an independent
contractor. Rule, with reasons. (4%)

8
SUGGESTED ANSWER:

The test of independent contractorship was applied in the case of Polyfoam-RGC International
Corporation v. Concepcion, G.R. No. 172349, June 13, 2012. Thus, the High Court ruled:
The test of independent contractorship is “whether one claiming to be an independent
contractor has contracted to do the work according to his own methods and without being
subject to the control of the employer, except only as to the results of the work.” (San Miguel
Corporation v. Aballa, G.R. No. 149011, June 28, 2005, 461 SCRA 392, 421) In San Miguel
Corporation v. Semillano, G.R. No. 164257, July 5, 2010, 623 SCRA 114 the Court laid down the
criteria in determining the existence of an independent and permissible contractor
relationship, to wit:
“x x x [W]hether or not the contractor is carrying on an independent business; the nature and
extent of the work; the skill required; the term and duration of the relationship; the right to
assign the performance of a specified piece of work; the control and supervision of the work
to another; the employer’s power with respect to the hiring, firing and payment of the
contractor’s workers; the control of the premises; the duty to supply the premises, tools,
appliances, materials, and labor; and the mode, manner and terms of payment.” (San Miguel
Corporation v. Semillano, supra, at p. 124; Sasan, Sr. v. National Labor Relations Commission
4th Division, supra at p. 691)
Applying the above-test, the nurses are employees of Dr. Crisostomo. The facts had clearly
stated that Dr. Crisostomo was the one paying the salaries of the nurses and even reported
them for SSS coverage. The element of payment of wages is present.
NOTE: The foregoing answer can be found in page 497 of the book entitled Principles and
Cases Labor Standards and Social Legislation, First Edition 2015, by Atty. Voltaire T. Duano. The
topic on the distinction between salary and wage has been the subject matter of bar questions
during the 1994 Bar Examination. The problem can also be resolved by characterizing the
relationship of Dr. Crisostomo and AB Hoteland Resort as to whether it is a legitimate
contracting or labor-only contracting. The topic on contracting/subcontracting has been time
and again the subject matter of bar questions, more specifically during the 2016, 2014, 2013,
2012, 2011, 2009, 2004, 2002, 2001, 2000, 1997 and 1994 Bar Examinations.