FUNDAMENTALS OF LABOR LAW

OUTLINE:
I. THE POLICY OF LABOR PROTECTION
a. CONSTITUTIONAL STATE POLICIES
i. LABOR IS AN ACTIVE AND EQUAL PARTNER
ii. FULL PROTECTION TO LABOR
1. FORMULA:
a. BY PROVIDING LABOR STANDARDS
b. PROMOTING THE RIGHT TO COLLECTIVE BARGAINING
c. BY PROVIDING SOCIAL BENEFITS
iii. PREFERENTIAL OPTION FOR FILIPINO WORKERS
b. SOURCES OF THE POWER TO ENACT LABOR LAWS
i. CONSTITUTION
1. Article II, Section 5
The maintenance of peace and order, the protection of life, liberty and
property, and the promotion of the general welfare are essential for the
enjoyment by all the people of the blessings of democracy.
Peace and order- encompass industrial peace contemplating the harmonious
relationship between employer and employee.
Protection to life, liberty and property-is applicable to the labor sector
considering that it had been held that one’s employment is considered as
property, from which emanates the right to live, and the liberty in reaping the
fruits thereof.
2. Article II, Section 10
The State shall promote social justice in all phase of national development.
Underlying premise: poverty and gross inequality are major problems besetting the
nation and that these problems assault the dignity of the human person.
Social justice- is the equalization of economic, political and social
opportunities with special emphasis on the duty of the state to tilt the balance of
social forces by favoring the disadvantaged in life.
- Justice for the common tao (1935 Constitution)
- Those who have less in life should have more in law
This provision led to gradual eradication of the vestiges of laissez faire
GENERAL PROVISIONS AND POLICIES
3. Article II, Section 18 in relation to Article 3 and 4 of Labor
Code
The State affirms labor as a primary social economic force. It shall protect the
rights of workers and promote their welfare.
Art.3. Declaration of basic policy.- The State shall afford protection to labor,
promote full employment, ensure equal work opportunities regardless of sex,
race, or creed and regulate the relations between workers and employers. xxx
Art. 4. Construction in favor of labor.- All doubts in the implementation and
interpretation of the provisions of this Code, including its IRR, shall be
resolved in favor of labor.
4. Article XII Section 12: nationalistic policy re labor
The State shall promote the preferential use of Filipino labor, domestic
materials and locally produced goods, and adopt measures that help make
them competitive.
5. Article XII Section 14: Nationalistic policy re field
endeavor
The sustained development of a reservoir of national talents consisting of Filipino
scientists, entrepreneurs, professionals, managers, high-level technical manpower and
skilled workers and craftsmen in all fields shall be promoted by the State. The State shall
encourage appropriate technology and regulate its transfer for the national benefit.
The practice of all professions in the Philippines shall be limited to Filipino citizens, save
in cases prescribed by law.
6. Article XIV Section 4(2): re educational institutions
Educational institutions, other than those established by religious groups and mission
boards, shall be owned solely by citizens of the Philippines or corporations or
associations at least sixty per centum of the capital of which is owned by such citizens.
The Congress may, however, require increased Filipino equity participation in all
educational institutions.
The control and administration of educational institutions shall be vested in citizens of
the Philippines.
No educational institution shall be established exclusively for aliens and no
group of aliens shall comprise more than one-third of the enrollment in any
school. The provisions of this subsection shall not apply to schools established for
foreign diplomatic personnel and their dependents and, unless otherwise provided by
law, for other foreign temporary residents.
7. Article XVI Section 11(1): mass media
The ownership and management of mass media shall be limited to citizens of
the Philippines, or to cooperation, cooperatives or associations, wholly owned
and managed by such citizens.
The Congress shall regulate or prohibit monopolies in commercial mass media when the
public interest so requires. No combinations in restraint of trade or unfair
competition therein shall be allowed.

8. Article XVI Section 11(2): in advertising industry

The advertising industry is impressed with public interest, and shall be regulated by law
for the protection of consumers and the promotion of the general welfare.
The participation of foreign investors in the governing body of entities in such industry
shall be limited to their proportionate share in the capital thereof, and all the executive
and managing officers of such entities must be citizens of the Philippines.
Only Filipino citizens/corporations/associations at least 70% of the capital of which is
owned are allowed to engaged in advertising.
LABOR RELATIONS
9. Article XIII Section 3: Protection of labor clause
The State shall afford full protection to labor, local and overseas, organized
and unorganized, and promotes full employment and equality of employment
opportunities for all.
It shall guarantee the rights of workers to self-organization, collective bargaining
and negotiations, and peaceful concerted activities including the right to
strike in accordance with law. They shall be entitled to security of tenure,
humane conditions of work, and living wage. They shall also participate in
policy and decision-making processes affecting their rights and benefits as
may be provided by law.
The State shall promote the principle of shared responsibility between workers
and employers and the preferential use of voluntary modes in settling
disputes, including conciliation, and shall enforce their mutual compliance
therewith to foster industrial peace.
The State shall regulate the relations between workers and employers,
recognizing the right of labor to its just share in the fruits of production and
the right of enterprises to reasonable returns on investments, and to
expansion and growth.

10. Article XIII Section 14

The State shall protect working women by providing safe and healthful
working conditions, taking into account their maternal functions, and such facilities
and opportunities that will enhance their welfare and enable them to realize their full
potential in the service of the nation.
11. Article III, Section 1: Due Process and Equal
Protection
No person shall be deprived of life, liberty and property, nor shall any person be denied
the equal protection of the laws.
Bill of Rights: civil and political rights; self-implementing
Art. XII: social and economic rights; non-self-executory, requires implementing legislation

Property- includes vested rights such as a perfected mining claim, perfected homestead
or final judgement; includes right to work and right to earn a living
Profession, trade, employment, calling is a property right and the wrongful interference
therewith is an actionable wring. Thus, Order of Preventive Suspension without
opportunity to be heard-violates property right.

Security of tenure- no worker shall be dismissed except for just or authorized causes
provided by law and after due process. By the use of the term worker, it presupposes
that all workers are entitled to security of tenure, no matter what their status, position or
term of employment. Be they probationary, casual, contractual, term employee, piece
rate, task basis, household help, etc
Two considerations: manner of dismissal (adherence to due process clause) and act of
dismissal (just and authorized cause)
12. Article III, Section 4: Freedom of Expression
No law shall be passed abridging the freedom of speech, of expression, or of the press,
or the right of the people peaceably to assemble and petition the government for
redress of grievances.
Kapatiran ng Manggagawa ng Camara v Camara Shoes (111 SCRA 478)- The right of
freedom of expression is applicable not only in times of labor dispute but during
industrial peace to air valid grievances.
13. Article III, Section 8: Freedom of Association
The right of the people, including those employed in the public and private
sectors to form unions, associations, or societies for purposes not contrary to
law shall not be abridged.
Right to join unions includes privilege not to join. Exception- when there is a Union
Security Clause in the CBA, provided that the USC shall be of prospective effect should a
labor union opt to choose such USC in their CBA and that the sanctions involved therein
must be explicitly stated, and cannot be mere implied.
14. Article III, Section 10 in relation to Article 1700 and
1702 of the New Civil Code: Non-impairment clause
No law impairing the obligations of contracts shall be passed.
Sanctity of employment contracts except in the exercise of police power. Contracts may
be impaired as long as such power is lawfully exercised.
Although the rights and duties arising from labor relationships are basically contractual in
nature, these are not covered by the general law on oblicon.
Art. 1700. The relations between capital and labor are not merely contractual.
They are so impressed with public interest that labor contracts must yield to
the common good. Therefore, such contracts are subject to the special law on labor
unions, collective bargaining, strikes and lockouts, closed shop, wages, working
conditions, hours of labor, and similar subjects.
Art. 1702. In case of doubt, all labor legislation and all labor contracts shall be
construed in favor of the safety and decent living for the laborer.
15. Article III, Section 11: Free access to courts
Free access to the courts and quasi-judicial bodies and adequate legal
assistance shall not be denied to any person by reason of poverty.
Quasi-judicial bodies- like those having jurisdiction over labor cases: LA, NLRC, DOLE
16. Article III, Section 16: Right to speedy disposition of
cases
All persons shall have the right to a speedy disposition of their cases before all
judicial, quasi-judicial, or administrative bodies.
No filing fee or legal fee when filing grievances with the NLRC.
Zero backlog of dockets at NLRC.
17. Article III, Section 18 (2): Right against involuntary
servitude
No involuntary servitude in any form shall exist except as punishment for a
crime whereof the party shall have been duly convicted.
ii. POLICE POWER OF THE STATE
1. CONCEPT
2. RULE MAKING POWER OF THE DOLE SECRETARY (ART. 5
LC)
c. STATE’S POWER TO REGULATE
II. ELEMENTS OF LABOR LAWS
a. LABOR POLICIES
b. LABOR STANDARDS
c. LABOR RELATIONS LAW
d. SOCIAL LAW
III. COVERAGE AND APPLICABILITY OF THE LABOR CODE
a. RULE
i. IT APPLIES TO AGRICULTURAL AND NON-AGRICULTURAL
WORKERS
b. EXCEPTIONS:
i. REGULAR GOVERNMENT AGENCIES
ii. GOCCS
iii. INTERNATIONAL ORGANIZATIONS
iv. SPECIALIZED AGENCIES
IV. EMPLOYER-EMPLOYEE RELATIONSHIP
a. TEST OF ER-EE
i. Four-fold test:
1. Power of selection and engagement
2. Power of dismissal
 3. Economic conditions or payment of wages
4. Power of control over employee’s conduct
a. Control over the means and manner of work done
and over the results of the work
b. Status of:
A. doctor hired as consultant or on part time
retainer: Ramos v CA: In other words, private
hospitals, hire, fire and exercise real control over
their attending and visiting consultant staff. While
consultants are not, technically employees, a point
which respondent hospital asserts in denying all
responsibility for the patients condition, the control
exercised, the hiring, and the right to terminate
consultants all fulfill the important hallmarks of an
employer-employee relationship, with the exception
of the payment of wages. In assessing whether
such a relationship in fact exists, the control test is
determining. Accordingly, on the basis of the
foregoing, we rule that for the purpose of allocating
responsibility in medical negligence cases, an
employer-employee relationship in effect exists
between hospitals and their attending and visiting
physicians.
B. barbers,
C. jeepney drivers under boundary system,
D. drivers not considered field personnel,
E. insurance agents
b. CASES WHEN ER-EE EXISTS
c. METHOD OF COMPENSATION NOT DETERMINATIVE OF ER-EE
V. BASIC RIGHTS OF WORKERS
VI. RECENT JURISPRUDENCE

SSS ACT

Employer
-is any person, natural or juridical, domestic or foreign, who carries on in the
Philippines any trade, business, industry, undertaking or activity of any kind
and uses the services of another person who is under his orders as regards the
employment
-a self-employed person shall be both employee and employer at the same
time

Employee
- Any person who performs services for an employer in which either or
both mental and physical efforts are used and who receives
compensation for such services, where there is an employer-employee
relationship
- Only natural persons (do not include juridical persons)
- A CORPORATION CANNOT BE AN EMPLOYEE
- A COOPERATIVE MEMBER CANNOT BE AN EMPLOYEE OF THE COOPERATIVE

GSIS

Employer
-the national government, its political subdivisions, branches, agencies or
instrumentalities, including GOCCs and financial institutions with original
charters, the constitutional commissions and the judiciary

Employee
-Any person receiving compensation while in the service of an employer as defined
herein, whether by election of appointment, irrespective of status of appointment,
including barangay and Sanggunian officials
POEA
Employer
-as any person, partnership or corporation, whether local or foreign, directly
engaging the services of Filipino workers overseas

Employee
-Migrant Workers or Overseas Filipino Workers, "a person to be engaged, is engaged,
or has been engaged in a remunerated activity in a state of which he or she is
not a legal resident

TESDA (Technical Education and Skills Development Act of 1994) and its Implementing
Rules

Employer
-the individual firm or any other entity qualified to hire apprentices under the
Code. Thus, it cannot be an individual, but must be an entity or a firm. And
even granting that it is such a juridical person, it must be qualified under the
provisions of RA 7796
- (entity means juridical persons)

Employee
-trainees shall mean persons who are participants in a vocational, administrative or technical training program for the
purpose of acquiring and developing job-related skills
-apprentice is a person undergoing training for an approved apprenticeable occupation during an apprenticeship
agreement
-learners refers to persons hired as trainees in semi-skilled and other industrial occupations which are non-
apprenticeable. Leadership programs must be approved by the Authority.

Art. 107. Labor Code, INDIRECT EMPLOYER

Employer
-any person, partnership or association or corporation which, not being an employer, contracts with an independent
contractor for the performance of any work, job, task or project

Employee
- Contractual, project, fixed-term, seasonal, casual, on-call, task-based, piece rate workers, etc

Art. 155. Labor Code. Employer of Homeworkers

Employer
- Any person, natural or artificial, who for his account or benefit, or on behalf of any person residing outside the
country, directly or indirectly or through any employee, agent, contractor, sub-contractor or any person
- Delivers or causes to be delivered any goods, articles or materials to be processed or fabricated in or about a
home and thereafter to be returned or to be disposed of or distributed in accordance with his directions, or
- Sells any goods, articles or materials to be processed or fabricated in or about a home and then re-buys them
after such processing or fabrication, either himself or through some other person

Employee
- Art. 153. Employment of Homeworkers (DO No. 5 Feb. 4, 1991)
- Any person who performs industrial work for an employer, contractor or sub-contractor
- Industrial homework is a system of production under which work for an employer or contractor is carried out by
s homeworker at his home. Materials may or may not be furnished by the employer or contractor.
- These type of workers are governed by the provisions of DO No. 5 dated Feb. 1991
RA NO 10361 KASAMBAHAY LAW

Employer

- Refers to any person who engages and controls the services of a domestic worker and is party to the
employment contract
- Household refers to the immediate members of the family or the occupants of the house that are directly
provided services by the domestic worker

Employee

- Any person engaged in domestic work within an employment relationship such as, but not limited to the
following:
o General househelp
 o Nursemaid or yaya
o Cook
o Gardener
o Laundry person
o But shall exclude any person who performs domestic work only occasionally or sporadically and not
on an occupational basis
- The term shall not include children who are under foster family arrangement, and are provided access to
education and given an allowance incidental to education i.e. baon, transportation, school projects and school
activities

CLASSIFICATION OF EMPLOYEES (3S+ 3H +4P + 2F= 3CLAM3) OR (F(2)L C(3)H(3)AM(3)p(4)S(3)

Seasonal Employees

- For seasonal employees to be excluded from those classified as regular employees, it is not enough that they
perform work that is seasonal in nature. They must have been employed only for the duration of one season. If
seasonal workers perform the same tasks for the employer every season for several years, accumulating at
least 12 months, they will be considered regular seasonal employees for their respective tasks. Seasonal
workers who are called to work from time to time and are temporarily laid off during off-season are not
separated from service, but merely considered on leave until re-employed.
- If the employee has been performing the job for at least a year, even if the performance is not continuous and
merely intermittent, the law deems repeated and continuing need for its performance as sufficient evidence of
the necessity if not indispensability of that activity to the business. Hence, the employment is considered
regular, but only with respect to such activity and while such activity exists.
- These workers as above-described are sometimes referred to a permanent or regular seasonal workers
- Examples: packers of tobacco hired by tobacco farms

Supervisory Employees

-Art. 212 (m). those, 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 judgement

-IRR- Book 5, Sec 1 (1)

- not actually managerial since they do not lay down company policies; the exercise is not supreme but merely
advisory in character. Theirs is not a final determination of the company policies inasmuch as any action taken by them
on matters relative to hiring, promotion, transfer, suspension, and termination of employees is still subject to
confirmation and approval by their respective superior

-thus where such power, which is in effect recommendatory in character, is subject to evaluation, review and final action
by the department heads and other higher executives of the company,…

SPECIAL GROUP OF WORKERS

1. Handicapped Workers
- RA 7277 THE MAGNA CARTA FOR DISABLED PERSONS
- RA 9442
- SEC. 5 INCENTIVES FOR EMPLOYERS (incentive for handicapped workers)
Women Workers

- Article (di mabasa)- nightworkers (workers in night clubs, cocktail lounges, beer house, massage clinic, bar or
similar establishments) with or without compensation, under the effective control and supervision of the
owner are employees
- RA 8972 Solo Parents Welfare Act of 2000 (parental leave and flexible work schedule)
- Department Order No 112A (special leave benefit for women)
- Discrimination Against Women: unlawful to deny any women employee the benefits provided for in the law to
discharge any woman employed by him for the purpose of preventing her from enjoying any of the benefits
provided under the Labor Code and other laws; to discharge such woman on account of her pregnancy, or while
on leave or in confinement due to her pregnancy; to discharge or refuse the admission of such woman upon
returning to her work for fear that she may again be pregnant;
- RA 10151: An Act Allowing the Employment of Night Workers- Article 158
- Art. 161 Night Work Schedule

Bus-Drivers and Conductors

-DO no. 118-12 s 2012

Security Guards

TV and Movie Industry

Debt Collectors

Construction

Business Processing Outsourcing

Knowledge Outsource Processing