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BAR REVIEW NOTES ON CRITICAL AREAS IN LABOR LAW PART I

relations rights of workers. Among the relevant

CRITICAL INSIGHTS ON constitutional provisions on labor are as follows:
LABOR LAW
(LABOR STANDARDS) 1. The State shall promote a just and
dynamic social order that will ensure the
prosperity and independence of the nation
and free the people from poverty through
IMPORTANT ARTICLES: policies that provide adequate social
services, promote full employment, a rising
1. GENERAL PROVISIONS: Articles 4 and 6 standard of living, and an improved quality
2. BOOK ONE: Articles 13(b), 18, 22, 26, 27, of life for all. (1987 Constitution,
28, 29, 35, 36, 37, 38 and 40 Declaration of Principles and State
3. BOOK TWO: Articles 58, 59, 73, 74, 78, Policies, Article II, Section 9)
4. BOOK THREE: Articles 82 to 88, 93, 97 (f),
100, 105, 106-109, 113, 114, 115, 124, 128, 2. The State shall promote social
129, 133, 134 to 136, 138 justice in all phases of national
development. (1987 Constitution,
General classifications of labor statutes Declaration of Principles and State
Policies, Article II, Section 10)
2004, 2003, 1997 and 1995 Bar Examinations
3. The State values the dignity of
1. Labor standards law shall refer to the every human person and guarantees full
minimum requirements prescribed by existing respect for human rights. (1987
laws, rules and regulations and other issuances Constitution, Declaration of Principles
relating to wages, hours of work, cost of living and State Policies, Article II, Section 11)
allowances and other monetary and welfare
benefits, including those set by occupational 4. The State recognizes the vital role
safety and health standards. (Section 7, Rule I, of the youth in nation-building and shall
Rules on the Disposition of Labor Standards promote and protect their physical, moral,
Cases in the Regional Office, dated spiritual, intellectual, and social well-being.
September 16, 1987, cited in Maternity It shall inculcate in the youth patriotism and
Children's Hospital vs. Secretary of Labor, nationalism, and encourage their
GR No. 78909, June 30, 1989) involvement in public and civic affairs.
(1987 Constitution, Declaration of
2. Social security law are those laws Principles and State Policies, Article II,
that provide for income security and/or medical Section 13)
care for contingencies such as: a. sickness b.
maternity c. invalidity d. old age e. death of a 5. The State recognizes the role of
bread winner; unemployment; f. emergency women in nation-building, and shall ensure
expenses; and g. employment injuries. (ILO the fundamental equality before the law of
Recommendation No. 67 cited in page 159 women and men. (1987 Constitution,
Labor and Social Legislation An Updated Declaration of Principles and State
Systematic Presentation, Froilan M. Policies, Article II, Section 14)
Bacungan 2011)
6. The State affirms labor as a
3. Labor relations law defines the primary social economic force. It shall
status, rights and duties, and the institutional protect the rights of workers and promote
mechanisms, that govern the individual and their welfare. (1987 Constitution,
collective interactions of employers, employees Declaration of Principles and State
or their representatives. (Glossary of Policies, Article II, Section 18)
Philippine industrial Relations Terms and
Phrases, 2nd Edition 2006, Nicolas B. 7. The State recognizes the
Barriatos, page 306) indispensable role of the private sector,
encourages private enterprise, and
Constitutional provisions on labor provides incentives to needed investments.
(1987 Constitution, Declaration of
2012, 2011 and 2009 Bar Examinations Principles and State Policies, Article II,
Section 20)
The 1987 Constitution mandates the
protection of labor and the promotion of their 8. No person shall be deprived of life,
welfare. Thus, the 1987 Constitution provides liberty, or property without due process of
the fundamental labor standards and labor law, nor shall any person be denied the

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Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
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equal protection of the laws. (1987 National Economy and Patrimony,

Constitution, Bill of Rights, Article III, Article XII, Section 6)
Section 1)
16. The State shall promote the
9. No law shall be passed abridging preferential use of Filipino labor, domestic
the freedom of speech, of expression, or of materials and locally produced goods, and
the press, or the right of the people adopt measures that help make them
peaceably to assemble and petition the competitive. (1987 Constitution, National
government for redress of grievances. Economy and Patrimony, Article XII,
(1987 Constitution, Bill of Rights, Article Section 12)
III, Section 4)
17. The sustained development of a
10. The right of the people, including reservoir of national talents consisting of
those employed in the public and private Filipino scientists, entrepreneurs,
sectors, to form unions, associations, or professionals, managers, high-level
societies for purposes not contrary to law technical manpower and skilled workers
shall not be abridged. (1987 Constitution, and craftsmen in all fields shall be
Bill of Rights, Article III, Section 8) promoted by the State. The State shall
encourage appropriate technology and
11. The civil service embraces all regulate its transfer for the national benefit.
branches, subdivisions, instrumentalities,
and agencies of the Government, including The practice of all professions in the
government-owned or controlled Philippines shall be limited to Filipino
corporations with original charters. (1987 citizens, save in cases prescribed by law.
Constitution, Civil Service, Article IX-B, (1987 Constitution, National Economy
Section 2 [3]) and Patrimony, Article XII, Section 14)

12. No officer or employee of the civil 18. The Congress shall not, except
service shall be removed or suspended by general law, provide for the formation,
except for cause provided by law. (1987 organization, or regulation of private
Constitution, Civil Service, Article IX-B, corporations. Government-owned or
Section 2 [3]) controlled corporations may be created or
established by special charters in the
13. The right to self-organization interest of the common good and subject to
shall not be denied to government the test of economic viability. (1987
employees. (6) Temporary employees of Constitution, National Economy and
the Government shall be given such Patrimony, Article XII, Section 16)
protection as may be provided by law.
(1987 Constitution, Civil Service, Article 19. The Congress shall give highest
IX-B, Section 2 [5]) priority to the enactment of measures that
protect and enhance the right of all the
14. The Congress shall provide for people to human dignity, reduce social,
the standardization of compensation of economic, and political inequalities, and
government officials and employees, remove cultural inequities by equitably
including those in government-owned or diffusing wealth and political power for the
controlled corporations with original common good.
charters, taking into account the nature of
the responsibilities pertaining to, and the To this end, the State shall regulate
qualifications required for, their positions. the acquisition, ownership, use, and
(1987 Constitution, Civil Service, Article disposition of property and its increments.
IX-B, Section 5) (1987 Constitution, Social Justice and
Human Rights, Article XIII, Section 1)
15. The use of property bears a
social function, and all economic agents 20. The promotion of social justice
shall contribute to the common good. shall include the commitment to create
Individuals and private groups, including economic opportunities based on freedom
corporations, cooperatives, and similar of initiative and self-reliance. (1987
collective organizations, shall have the Constitution, Social Justice and Human
right to own establish, and operate Rights, Article XIII, Section 2)
economic enterprises, subject to the duty
of the State to promote distributive justice 21. The State shall afford full
and to intervene when the common good protection to labor, local and overseas,
so demands. (1987 Constitution, organized and unorganized, and promote

2024 Bar Review Notes on Critical Areas in Labor Law Part I by Jurists Bar Review Center. © 2024 by
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full employment and equality of negotiations, and peaceful concerted

employment opportunities for all. activities, including the right to strike in
accordance with law.
It shall guarantee the rights of all
workers to self-organization, collective 4. Working conditions — To
bargaining and negotiations, and peaceful security of tenure, humane conditions of
concerted activities, including the right to work, and a living wage.
strike in accordance with law. They shall
be entitled to security of tenure, humane 5. Codetermination — Participation
conditions of work, and a living wage. They in policy and decision-making processes
shall also participate in policy and decision- affecting their rights and benefits as may
making processes affecting their rights and be provided by law.
benefits as may be provided by law.
6. Shared responsibility — Promote
The State shall promote the principle the principle of shared responsibility
of shared responsibility between workers between workers and employers.
and employers and the preferential use of
voluntary modes in settling disputes, 7. Policy on dispute resolution —
including conciliation, and shall enforce Preferential use of voluntary modes in
their mutual compliance therewith to foster settling disputes, including conciliation, and
industrial peace. shall enforce their mutual compliance
therewith to foster industrial peace.
The State shall regulate the relations
between workers and employers, 8. Right of labor and of enterprise
recognizing the right of labor to its just — Right of labor to its just share in the
share in the fruits of production and the fruits of production and the right of
right of enterprises to reasonable returns to enterprises to reasonable returns to
investments, and to expansion and growth. investments, and to expansion and growth.
(1987 Constitution, Labor, Article XIII,
Section 3) Construction in favor of labor

22. The State shall protect working 2006 Bar Examinations

women by providing safe and healthful
working conditions, taking into account In Reyes v. Rural Bank of San Rafael
their maternal functions, and such facilities (Bulacan) Inc., G.R. No. 230597, March
and opportunities that will enhance their 23,2022 the Supreme Court ruled on the proper
welfare and enable them to realize their full construction and interpretation of labor laws and
potential in the service of the nation. (1987 its implementing rules in case of doubt as
Constitution, Women, Article XIII, follows:
Section 14)
In carrying out and interpreting the
Protection to labor clause under the 1987 Labor Code's provisions and its
Constitution implementing regulations, the
workingman's welfare should be the
1998 and 1996 Bar Examinations primordial and paramount consideration.
This kind of interpretation gives meaning
This clause on protection to labor can and substance to the liberal and
be found in Article XIII, Section 3 of the compassionate spirit of the law as
1987 Constitution. It guarantees the provided for in Article 4 of the Labor
following: Code. The policy is to extend the
decree’s applicability to a greater
1. Extent and coverage of number of employees to enable them to
protection — Full protection to labor, local avail of the benefits under the law, in
and overseas, organized and unorganized consonance with the State's avowed
policy to give maximum aid and
2. Policy on employment — protection to labor.
Promote full employment and equality of
employment opportunities for all. 2017 and 2009 Bar Examinations

3. Unionism and Methods of Article 4 of the Labor Code extended to

Determination Conditions of cover doubts in the evidence
Employment, Concerted Activities —
The rights of all workers to self- In Loadstar International Shippine, Inc.
organization, collective bargaining and v. Cawaling, G.R. No. 242725, June 16, 2021,

2024 Bar Review Notes on Critical Areas in Labor Law Part I by Jurists Bar Review Center. © 2024 by
Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
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it ruled: Moreover, doubts shall be resolved in decision must be tempered to

favour of labor in line with the policy enshrined in safeguard the constitutional guarantee
the Constitution,(Constitution, Article XIII, of providing "full protection to labor."
Section 3) the Labor Code, (LABOR CODE, Management prerogative cannot justify
violation of law or the pursuit of any
Article 4) and the Civil Code,(CIVIL CODE, arbitrary or malicious motive. (Id. at
Article 1702) to provide protection to labor and 501.)
construe doubts in favour of labor. This Court
has consistently held that "if doubts exist Outsourcing any activities as management
between the evidence presented by the prerogative
employer and the employee, the scales of
justice must be tilted in favor of the latter." 2001 and 1994 Bar Examinations
(Toquero v. Crossworld Marine Services, Inc.,
G.R. No. 213482, June 26, 2019) On the issue of outsourcing as a
management prerogative, the Supreme Court
Concept of management prerogatives held: In one case, the Court held that it is
management prerogative to farm out any of its
The Supreme defined management activities, regardless of whether such activity is
prerogative: the right of the employer to regulate peripheral or core in nature. (Alviado v. Procter
all aspects of employment, such as the freedom & Gamble Phils., Inc, G.R. No. 160506, March
to prescribe work assignments, working 9, 2010,614 SCRA 563,577) What is of
methods, processes to be followed, regulation primordial importance is that the service
regarding transfer of employees, supervision of agreement does not violate the employee's right
their work, lay-off and discipline, and dismissal to security of tenure and payment of benefits to
and recall of work. (Roxas v. Baliwag Transit, which he is entitled under the law. Furthermore,
Inc., G.R. No. 231859, February 19,2020) the outsourcing must not squarely fall under
labor-only contracting where the contractor or
sub-contractor merely recruits, supplies or
Criterion to guide in the exercise of places workers to perform a job, work or service
management prerogatives for a principal xxx.” (BPI- Employees Union-
Davao City FUBU (BPIEU-Davao City-FUBU)
1998 Bar Examination v. Bank of the Philippine Islands, 174912,
July 24,2013)
Asian Institute of Management Faculty
Association v. Asian Institute of Grant of bonus
Management, G.R. No. 219025, September 9,
2020: Thus, we have held that management is 2014, 2005, 2003, 2002 and 1995 Bar
free to regulate, according to its own discretion Examinations
and judgment, all aspects of employment,
including hiring, work assignments, supervision Mega Magazine Publications, Inc. v.
and transfer of employees, working methods, Defensor, G.R. No. 162021, June 16, 2014:
time, place and manner of work. This is so
The grant of a bonus or special incentive,
because the law on unfair labor practices is not
being a management prerogative, is not a
intended to deprive employers of their
fundamental right to prescribe and enforce such
demandable and enforceable obligation,
rules as they honestly believe to be necessary to except when the bonus or special incentive is
the proper, productive and profitable operation made part of the wage, salary or
of their business. (Id. at 562-563.) (Citations compensation of the employee, (See Protacio
omitted) However, management prerogative v. Laya Mananghaya & Co., G.R. No. 168654,
should be exercised in accordance with justice March 25, 2009, 582 SCRA 417, 429.) or is
and fair play. (Julie's Bakeshop v Arnaiz, 682 Phil. promised by the employer and expressly
95, 111 (2012) [Per J. Del Castillo, First Division].) agreed upon by the parties. (Lepanto
Philippine Airlines, Inc. v. Dawal, 781 Phil. 474 Ceramics, Inc. v. Lepanto Ceramics
(2016) [Per J. Leonen, Second Division]. discussed Employees Association, G.R. No. 180866,
that the employer's right to management March 2, 2010, 614 SCRA 63, 71.) By its very
prerogative will not absolve it of liability if its acts definition, bonus is a gratuity or act of liberality
are against the law or motivated by unlawful of the giver, (Id.) and cannot be considered
causes: part of an employee’s wages if it is paid only
when profits are realized or a certain amount
[Philippine Airlines'] claim of
management prerogative does not
of productivity is achieved. If the desired goal
automatically absolve it of liability. of production or actual work is not
Management prerogative is not accomplished, the bonus does not accrue.
unbridled and limitless. Nor is it beyond
this [C]ourt's scrutiny. Where abusive Post-employment ban
and oppressive, the alleged business

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Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
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2022 and 2009 Bar Examinations disqualifying from work any woman
worker who contracts marriage. We held
A non-involvement clause is not that the company policy violates the right
necessarily void for being in restraint of trade as against discrimination afforded all women
long as there are reasonable limitations as to workers under Article 136 of the Labor
time, trade, and place. In this case, the non- Code, but established a permissible
involvement clause has a time limit: two years exception, viz.:
from the time petitioner's employment with
respondent ends. It is also limited as to trade, [A] requirement that a woman
since it only prohibits petitioner from engaging in employee must remain unmarried
any pre-need business akin to respondent's. could be justified as a "bona fide
(Tiu v. Platinum Plans Phils, G.R. No. 163512, occupational qualification," or
BFOQ, where the particular
February 28, 2007) requirements of the job would
justify the same, but not on the
ground of a general principle,
Tests to determine the validity of a company such as the desirability of
policy on employment spreading work in the workplace.
A requirement of that nature
2019 and 2000 Bar Examinations would be valid provided it reflects
an inherent quality reasonably
The following are the tests: necessary for satisfactory job
performance[.]
1. Bona fide occupational qualification The cases of Duncan and PT&T instruct
(BFOQ) - Employment in particular jobs us that the requirement of reasonableness
may not be limited to persons of a must be clearly established to uphold the
particular sex, religion, or national origin questioned employment policy. The
unless the employer can show that sex, employer has the burden to prove the
religion, or national origin is an actual existence of a reasonable business
qualification for performing the job. The necessity. The burden was successfully
qualification is called a bona fide discharged in Duncan but not in
occupational qualification (BFOQ). PT&T. (Emphasis in the original, citations
(Black’s Law Dictionary, 6th ed. cited in omitted)
Yrasuegui v. Philippine Airlines, Inc.,
G.R. No. 168081, October 17, 2008) Substantial evidence is the quantum of
proof required in labor cases. It is "such
To justify a bona fide occupational relevant evidence as a reasonable mind
qualification, the employer must prove two might accept as adequate to support a
factors: conclusion." (citation omitted) To justify
their otherwise discriminatory policy,
(1) that the employment qualification is respondents have the burden to establish
reasonably related to the essential by substantial evidence the reasonable
operation of the job involved; and, necessity for it. They must show that no
(2) that there is a factual basis for other alternative to the policy exists.
believing that all or substantially all
persons meeting the qualification would 3. The disparate treatment and the
be unable to properly perform the duties disparate impact - Under the disparate
of the job. (Dela Cruz-Cagampan v. One treatment analysis, the plaintiff must
Network Bank, Inc., G.R. No. 217414, prove that an employment policy is
June 22, 2022 citing Star Paper discriminatory on its face. No-spouse
Corporation v. Simbol, G.R. No. 164774, employment policies requiring an
April 12, 2006) employee of a particular sex to either quit,
transfer, or be fired are facially
2. Test of Reasonable business discriminatory. For example, an
necessity - Dela Cruz-Cagampan v. One employment policy prohibiting the
Network Bank, Inc., G.R. No. 217414, employer from hiring wives of male
June 22, 2022: The requirement that a employees, but not husbands of female
company policy must employees, is discriminatory on its face.
be reasonable under the circumstances to On the other hand, to establish disparate
qualify as a valid exercise of management impact, the complainants must prove that
prerogative was also at issue in the 1997 a facially neutral policy has a
case of Philippine Telegraph and disproportionate effect on a particular
Telephone Company v. NLRC. In said class. For example, although most
case, the employee was dismissed in employment policies do not expressly
violation of petitioner's policy of indicate which spouse will be required to

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Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
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transfer or leave the company, the policy

often disproportionately affects one sex. 2014 and 1994 Bar Examinations
(Star Paper Corporation v. Simbol, G.R.
No. 164774, April 12, 2006) In a number of cases, the Supreme Court
affirmed the immunity from suit of certain
Applicability international organizations as follows:

The applicability of the Labor Code are 1. In Department of Foreign Affairs v.

subject to certain exceptions such as those NLRC, G.R. No. 113191, September 18,1996,
employed in the civil service, those employed in in upholding ADB’s immunity from suit, the
government-owned and controlled corporations Supreme Court held:
with special charter, involving intra-corporate
controversy, employers with immunity from suit Being an international organization
and those excluded under working conditions that has been extended a diplomatic
and rest periods of Book III Title I under Article status, the ADB is independent of the
82 of the Labor Code in relation to Rules I, municipal law. (SEAFDEC vs. NLRC,
Section 2, II, Section 1, Rule IV, Section 1 and 206 SCRA 283; See International
Rule , Section 1, Book III of the Rules to Catholic Migration Commission vs.
Implement the Labor Code. Calleja, supra) In Southeast Asian
Fisheries Development Center vs.
Test to determine whether a GOCC is subject Acosta, 226 SCRA 49 the Court has
to Civil Service Law cited with approval the opinion (No. 139,
Series of 1984) of the then Minister of
GSIS Family Bank Employees Union v. Justice; thus -
Villanueva, G.R. No. 210773, January 23,
2019: In National Housing Corporation vs. "One of the basic
Juco (L-64313, January 17, 1985, 134 SCRA immunities of an international
172), we laid down the doctrine that employees organization is immunity from
of government-owned and/or controlled local jurisdiction, i.e., that it is
corporations, whether created by special law or immune from the legal writs
formed as subsidiaries under the general and processes issued by the
Corporation Law, are governed by the Civil tribunals of the country where
Service Law and not by the Labor Code. it is found. (See Jenks, Id.,
However, the above doctrine has been pp. 37-44). The obvious
supplanted by the present Constitution, which reason for this is that the
provides: subjection of such an
organization to the authority of
"The Civil Service embraces all the local courts would afford a
branches, subdivisions, convenient medium thru
instrumentalities and agencies of which the host government
the Government, including may interfere in their
government-owned or controlled operations or even influence
corporations with original charters." or control its policies and
(Article IX-B, Section 2 [1]) decisions of the organization;
besides, such subjection to
Thus, under the present state of the law, local jurisdiction would impair
the test in determining whether a government- the capacity of such body to
owned or controlled corporation is subject to the discharge its responsibilities
Civil Service Law is the manner of its creation impartially on behalf of its
such that government corporations created by member-states." (At page 53)
special charter are subject to its provisions while
those incorporated under the general xxx
Corporation Law are not within its coverage.
(Phil. National Oil Company-Energy Dev't. Corp. Private respondent argues that, by
v. Hon. Leogardo, 256 Phil. 475, 477-478 (1989) entering into service contracts with
[Per J. Melencio-Herrera, Second Division].) different private companies, ADB has
descended to the level of an ordinary
party to a commercial transaction giving
rise to a waiver of its immunity from suit.
In the case of Holy See vs. Hon.
Rosario, Jr., 238 SCRA 524 the Court
has held:

Employers with immunity from suit

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“There are two conflicting any penal, civil and

concepts of sovereign administrative proceedings,
immunity, each widely held except insofar as that
and firmly established. immunity has been
According to the classical or expressly waived by the
absolute theory, a sovereign Director-General of the
cannot, without its consent, be Institute or his authorized
made a respondent in the representatives.
Courts of another sovereign.
According to the newer or In the case of International
restrictive theory, the Catholic Migration Commission v.
immunity of the sovereign is Hon. Calleja, et al. and Kapisanan ng
recognized only with regard to Manggagawa at TAC sa IRRI v.
public acts or acts jure imperii Secretary of Labor and Employment
of a state, but not with regard and IRRI, G.R. No. 85750 and G.R. No.
to private act or acts jure 89331, September 28, 1990, 190
gestionis. SCRA 130 the Court upheld the
constitutionality of the aforequoted law.
“x x x xxx xxx After the Court noted the letter of the
Acting Secretary of Foreign Affairs to
“Certainly, the mere the Secretary of Labor dated June 17,
entering into a contract by a 1987, where the immunity of IRRI from
foreign state with a private the jurisdiction of the Department of
party cannot be the ultimate Labor and Employment was sustained,
test. Such an act can only be the Court stated that this opinion
the start of the inquiry. The constituted "a categorical recognition by
logical question is whether the the Executive Branch of the
foreign state is engaged in the Government that . . . IRRI enjoy(s)
activity in the regular course immunities accorded to international
of business. If the foreign organizations, which determination has
state is not engaged regularly been held to be a political question
in a business or trade, the conclusive upon the Courts in order not
particular act or transaction to embarass a political department of
must then be tested by its Government. (Supra at pp. 139-140)
nature. If the act is in pursuit
of a sovereign activity, or an xxx
incident thereof, then it is an
act jure imperii, especially The grant of immunity to IRRI is
when it is not undertaken for clear and unequivocal and an express
gain or profit.” (At pp. 535- waiver by its Director-General is the only
536) way by which it may relinquish or
abandon this immunity.
The service contracts referred to by
private respondent have not been On the matter of waiving its
intended by the ADB for profit or gain immunity from suit, IRRI had, early on,
but are official acts over which a waiver made its position clear. Through
of immunity would not attach. counsel, the Institute wrote the Labor
Arbiter categorically informing him that
2. In Callado v. International Rice the Institute will not waive its diplomatic
Research Institute, G.R. No. 106483, May 22, immunity. In the second place,
1995 the Supreme Court resolved the issue: Did petitioner's reliance on the
the International Rice Research Institute (IRRI) Memorandum with "Guidelines in
waive its immunity from suit in this dispute which handling cases of dismissal of
arose from an employer-employee relationship? employees in relation to P.D. 1620"
dated July 26, 1983, is misplaced.
IRRI's immunity from suit is
undisputed. xxx

Presidential Decree No. 1620, We agree with private respondent

Article 3 provides: IRRI that this memorandum cannot, by
any stretch of the imagination, be
Art. 3. Immunity from considered the express waiver by the
Legal Process. The Institute Director-General.
shall enjoy immunity from

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xxx to international organizations. Clauses

on jurisdictional immunity are now
The memorandum, issued by the standard in the charters of the
former Director-General to a now- international organizations to guarantee
defunct division of the IRRI, was meant the smooth discharge of their functions.
for internal circulation and not as a
pledge of waiver in all cases arising The diplomatic immunity of private
from dismissal of employees. Moreover, respondent was sufficiently established
the IRRI's letter to the Labor Arbiter in by the letter of the Department of
the case at bench made in 1991 Foreign Affairs, recognizing and
declaring that it has no intention of confirming the immunity of UNRFNRE in
waiving its immunity, at the very least, accordance with the 1946 Convention
supplants any pronouncement of on Privileges and Immunities of the
alleged waiver issued in previous cases. United Nations where the Philippine
Government was a party. The issue
3. In Lasco v. United Nation Revolving whether an international organization is
Fund for Natural Resources Exploration entitled to diplomatic immunity is a
[UNRFNRE], G.R. Nos. 109095, February "political question" and such
23,1995 the immunity from suit of a specialized determination by the executive branch is
agencies of the UN was affirmed. Thus, it was conclusive on the courts and quasi-
held: judicial agencies (The Holy See v. Hon.
Corollary to the cited article is the Eriberto U. Rosario, Jr., G.R. No.
Convention on the Privileges and 101949, Dec. 1, 1994; International
Immunities of the Specialized Agencies Catholic Migration Commission v.
of the United Nations, to which the Calleja, supra).
Philippines was a signatory (Vol. 1,
Philippine Treaty Series, p. 621). We Our courts can only assume
quote Sections 4 and 5 of Article III jurisdiction over private respondent if it
thereof: expressly waived its immunity, which is
not so in the case at bench
Sec. 4. The specialized (Convention on the Privileges and
agencies, their property and Immunities of the Specialized
assets, wherever located and by Agencies of the United Nations, Art.
whomsoever held shall enjoy III, Sec. 4).
immunity from every form of
legal process except insofar as Private respondent is not engaged
in any particular case they have in a commercial venture in the
expressly waived their immunity. Philippines. Its presence here is by
It is, however, understood that virtue of a joint project entered into by
no waiver of immunity shall the Philippine Government and the
extend to any measure of United Nations for mineral exploration in
execution (Emphasis supplied). Dinagat Island. Its mission is not to
Sec. 5. The premises of the exploit our natural resources and gain
specialized agencies shall be pecuniarily thereby but to help improve
inviolable. The property and the quality of life of the people, including
assets of the specialized that of petitioners.
agencies, wherever located and
by whomsoever held, shall be 4. In upholding the lack of jurisdiction over
immune from search, the labor cases filed against petitioner, the
requisition, confiscation, Supreme Court in Southeast Asian Fisheries
expropriation and any other Development Center v. Acosta, G.R. Nos.
form of interference, whether by 97468-70 September 2, 1993 held: It is beyond
executive, administrative, question that petitioner SEAFDEC is an
judicial or legislative action international agency enjoying diplomatic
(Emphasis supplied). immunity. This, we have already held in
Southeast Asian Fisheries Development
xxx Center-Aquaculture Department vs. National
Labor Relations Commission, G.R. No.
In the International Catholic 86773, 206 SCRA 283/1992; see also
Migration Commission case, we held Lacanilao v. de Leon, G.R. No. 76532, 147
that there is no conflict between the SCRA, 286/1987/, where we said —
constitutional duty of the State to protect
the rights of workers and to promote Petitioner Southeast Asian
their welfare, and the grant of immunity Fisheries Development Center-

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Aquaculture Department actuations to the

(SEAFDEC-AQD) is an requirements of
international agency beyond the Philippine law, which
jurisdiction of public respondent may not necessarily
NLRC. coincide with the
xxx interests of the other
member-states. It is
The then Minister of Justice precisely to forestall
likewise opined that Philippine these possibilities that
Courts have no jurisdiction over in cases where the
SEAFDEC-AQD in Opinion No. extent of the immunity is
139, Series of 1984 — specified in the enabling
instruments of
4. One of the basic international
immunities of an organizations
international (jurisdictional immunity,
organization is immunity is specified in the
from local jurisdiction, enabling instruments of
i.e., that it is immune international
from the legal writs and organizations),
processes issued by the jurisdictional immunity
tribunals of the country from the host country is
where it is found. (See invariably among the
Jenks, Id., pp. 37-44). first accorded. (See
The obvious reason for Jenks, Id.; See Bowett.
this is that the The Law of International
subjection of such an Institutions. pp. 284-
organization to the 285).
authority of the local
courts would afford a When immunity from suit is not applicable
convenient medium thru
which the host In the consolidated cases of United
government may States of America v. Guinto, G.R. No.
interfere in their 76607 February 26, 1990, United States of
operations or even America v. Rodrigo, G.R. No. 79470
influence or control its February 26, 1990, United States of
policies and decisions America v. Ceballos, G.R. No. 80018
of the organization; February 26, 1990, United States of
besides, such objection America v. Alarcon Vergara, G.R. No.
to local jurisdiction 80258 February 26, 1990 the doctrine of
would impair the state immunity was not applied in G.R. No.
capacity of such body to 79470 and G.R. No. 76607. In the said
discharge its cases, the United States of America
responsibilities although not impleaded in the lower courts
impartially on behalf of moved to dismiss on the ground that they
its member-states. In are in effect suits against it to which it has
the case at bar, for not consented. It is now contesting the
instance, the denial of its motions by the respondent
entertainment by the judges. In resolving the issue, the Supreme
National Labor Court said:
Relations Commission
of Mr. Madamba's There is no question that the United
reinstatement cases States of America, like any other state,
would amount to will be deemed to have impliedly waived
interference by the its non-suability if it has entered into a
Philippine Government contract in its proprietary or private
in the management capacity. It is only when the contract
decisions of the involves its sovereign or governmental
SEARCA governing capacity that no such waiver may be
board; even worse, it implied. This was our ruling in United
could compromise the States of America v. Ruiz, 136 SCRA
desired impartiality of 487 where the transaction in question
the organization since it dealt with the improvement of the
will have to suit its wharves in the naval installation at

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Subic Bay. As this was a clearly they were acting as agents of the United
governmental function, we held that the States when they investigated and later
contract did not operate to divest the dismissed Genove. For that matter, not
United States of its sovereign immunity even the United States government
from suit. In the words of Justice Vicente itself can claim such immunity. The
Abad Santos: reason is that by entering into the
employment contract with Genove in the
xxx. discharge of its proprietary functions, it
impliedly divested itself of its sovereign
In G.R. No. 79470, private immunity from suit.
respondent Genove was employed as a
cook in the Main Club located at the But these considerations
U.S. Air Force Recreation Center, also notwithstanding, we hold that the
known as the Open Mess Complex, at complaint against the petitioners in the
John Hay Air Station. As manager of court below must still be dismissed.
this complex, petitioner Lamachia is While suable, the petitioners are
responsible for eleven diversified nevertheless not liable.
activities generating an annual income
of $2 million. Under his executive xxx
management are three service
restaurants, a cafeteria, a bakery, a Concerning G.R. No. 76607, we
Class VI store, a coffee and pantry also find that the barbershops subject of
shop, a main cashier cage, an the concessions granted by the United
administrative office, and a States government are commercial
decentralized warehouse which enterprises operated by private
maintains a stock level of $200,000.00 person's. They are not agencies of the
per month in resale items. He United States Armed Forces nor are
supervises 167 employees, one of their facilities demandable as a matter of
whom was Genove, with whom the right by the American servicemen.
United States government has These establishments provide for the
concluded a collective bargaining grooming needs of their customers and
agreement. offer not only the basic haircut and
From these circumstances, the shave (as required in most military
Court can assume that the restaurant organizations) but such other amenities
services offered at the John Hay Air as shampoo, massage, manicure and
Station partake of the nature of a other similar indulgences. And all for a
business enterprise undertaken by the fee. Interestingly, one of the
United States government in its concessionaires, private respondent
proprietary capacity. Such services are Valencia, was even sent abroad to
not extended to the American improve his tonsorial business,
servicemen for free as a perquisite of presumably for the benefit of his
membership in the Armed Forces of the customers. No less significantly, if not
United States. Neither does it appear more so, all the barbershop
that they are exclusively offered to these concessionaires are under the terms of
servicemen; on the contrary, it is well their contracts, required to remit to the
known that they are available to the United States government fixed
general public as well, including the commissions in consideration of the
tourists in Baguio City, many of whom exclusive concessions granted to them
make it a point to visit John Hay for this in their respective areas.
reason. All persons availing themselves
of this facility pay for the privilege like all This being the case, the petitioners
other customers as in ordinary cannot plead any immunity from the
restaurants. Although the prices are complaint filed by the private
concededly reasonable and relatively respondents in the court below. The
low, such services are undoubtedly contracts in question being decidedly
operated for profit, as a commercial and commercial, the conclusion reached in
not a governmental activity. the United States of America v. Ruiz
case cannot be applied here.
The consequence of this finding is
that the petitioners cannot invoke the Interpretation of the proviso in Article 13b of
doctrine of state immunity to justify the the Labor Code
dismissal of the damage suit against
them by Genove. Such defense will not The number of persons dealt with is not
prosper even if it be established that an essential ingredient of the act of recruitment

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and placement of workers. Any of the acts

mentioned in the basic rule in Article 13(b) will (a) All pre-employment/recruitment
constitute recruitment and placement even if violation cases which are administrative in
only one prospective worker is involved. The character, involving or arising out of violations of
proviso merely lays down a rule of evidence that Rules and Regulations relating to licensing and
where a fee is collected in consideration of a registration, including refund of fees collected
promise or offer of employment to two or more from the workers or violation of the conditions for
prospective workers, the individual or entity issuance of license or authority to recruit
dealing with them shall be deemed to be workers; and
engaged in the act of recruitment and
placement. The words “shall be deemed” create (b) Disciplinary action cases and other
that presumption. (People v. Panis, G.R. Nos. special cases, which are administrative in character,
L-58674-77, July 11, 1990) involving employers, principals, contracting partners
and OFWs processed by the POEA. (Section 6,
Republic Act 11641 known as the Rule X, Omnibus Rules and Regulations
Department of Migrant Workers Act Implementing The Migrant Workers and
Overseas Filipinos Act of 1995, as amended by
Section 4 of RA 11641 provides that: The Republic Act No. 10022)
Philippine Overseas Employment Administration
(POEA) created under Executive Order No. 247, Ban on direct-hiring
Series of 1987, as amended, and all the entities,
agencies and units enumerated in Section 19 2010 Bar Examination
are consolidated and merged, and hereby
constituted as the Department of Migrant SRL International Manpower Agency v.
Workers, hereinafter referred to as “the Yarza, Jr., G.R. No. 207828, February 14,
Department”. The Department is hereby 2022: "Under our Labor Code, employers hiring
organized structurally and functionally in [Overseas Filipino Workers or] OFWs may only
accordance with the provisions of this Act. do so through entities authorized by the
Secretary of the Department of Labor and
Section 19. Consolidation and Merger of Employment citing Dagasdas v. Grand
Agencies and Functions. – The following Placement and General Services Corp., 803
agencies are hereby consolidated and merged Phil. 463-477 (2017), citing Labor Code of the
into and constituted as the Department, and Philippines, Presidential Decree No. 442
their powers and functions subsumed to the (Amended & Renumbered), July 21, 2015
Department which shall assume and perform all [LABOR CODE], Article 18. Article 18. Ban on
their powers and functions: Direct-Hiring. – No employer may hire a Filipino
worker for overseas employment except through
(a) The POEA, as created under the Boards and entities authorized by the
Executive Order No. 247 and Republic Act No. Secretary of Labor. Direct-hiring by members of
8042, as amended; the diplomatic corps, international organizations
(b) The Office of the Undersecretary for and such other employers as may be allowed by
Migrant Workers’ Affairs (OUMWA) of the DFA the Secretary of Labor is exempted from this
as provided under Republic Act No. 8042, as provision.
amended;
(c) All Philippine Overseas Labor Offices Direct hires under the Omnibus Rules of RA
(POLO) under the DOLE; 8042, as amended by RA 10022
(d) The International Labor Affairs Bureau
(ILAB) under the DOLE; The direct hires are exempted from the
(e) The National Reintegration Center for ban on direct-hiring for overseas employment
OFWs (NRCO) under the OWWA; under Republic Act 8042, as amended by
(f) The National Maritime Polytechnic Republic Act No. 10022. They are the workers
(NMP) under the DOLE; and directly hired by employers for overseas
(g) The Office of the Social Welfare employment as authorized by the Secretary of
Attaché (OSWA) under the DSWD. Labor and Employment and processed by the
POEA, including:

1. Those hired by international

organizations
Jurisdiction of Philippine Overseas 2. Those hired members of the
Employment Administration (POEA), now diplomatic corps.
consolidated and merged with DMW 3. Name hires or workers who are able to
secure overseas employment opportunity with an
The POEA shall exercise original and employer without the assistance or participation
exclusive jurisdiction to hear and decide: of any agency. [Labor Code, POEA Rules]
(Section 1(i), Rule II, Omnibus Rules and

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Regulations Implementing The Migrant developments in the global services industry.

Workers and Overseas Filipinos Act of 1995, (First paragraph, Section 10, RA 8042 as
as amended by Republic Act No. 10022) amended by RA 10022)

Further, under Rule I, Part IV, Revised Voluntary Arbitration

POEA Rules and Regulations Governing the
Recruitment and Employment of Landbased Section 7, Rule VII of the Omnibus Rules
Overseas Filipino Workers of 2016 the and Regulations Implementing RA 10022
following are exempted from the ban on direct provides: For OFWs with collective bargaining
hiring: agreements, the case shall be submitted for
voluntary arbitration in accordance with Articles
a. Members of the diplomatic 261 and 262 of the Labor Code. Note Articles
corps; 261 and 262 are now Articles 274 and 275.
b. International organizations;
c. Heads of state and government Nature of liability of principal/employer and
officials with the rank of at least deputy the recruitment/placement agency for any
minister; or and all claims of the OFWs?
d. Other employers as may be
allowed by the Secretary of Labor and 2023, 2019 and 2017 Bar Examinations
Employment, such as:
The liability of the principal/employer and
1. Those provided in (a), (b) and (c) the recruitment/placement agency for any and
who bear a lesser rank, if endorsed by all claims under this section shall be joint and
the POLO, or Head of Mission in the several. This provision shall be incorporated in
absence of the POLO; the contract for overseas employment and shall
2. Professionals and skilled be a condition precedent for its approval. The
workers with duly executed/authentica- performance bond to de filed by the
ted contracts containing terms and recruitment/placement agency, as provided by
conditions over and above the law, shall be answerable for all money claims or
standards set by the POEA. The damages that may be awarded to the workers. If
number of professional and skilled the recruitment/placement agency is a juridical
Overseas Filipino Workers hired for the being, the corporate officers and directors and
first time by the employer shall not partners as the case may be, shall themselves
exceed five (5). For the purpose of be jointly and solidarily liable with the
determining the number, workers hired corporation or partnership for the aforesaid
as a group shall be counted as one; or claims and damages.
3. Workers hired by a
relative/family member who is a Such liabilities shall continue during the
permanent resident of the host entire period or duration of the employment
country. contract and shall not be affected by any
substitution, amendment or modification made
locally or in a foreign country of the said
contract. (2nd and 3rd paragraphs, Section 10,
RA 8042 as amended by RA 10022)

Jurisdiction over money claims of OFW Agency cannot be relieved of its liability
despite termination of its agency agreement
Labor Arbiters with the principal

Notwithstanding any provision of law to x x x Joint and solidary liability is meant to

the contrary, the Labor Arbiters of the National assure aggrieved workers of immediate and
Labor Relations Commission (NLRC) shall have sufficient payment of what is due them. The fact
the original and exclusive jurisdiction to hear and that petitioner and its principal have already
decide, within ninety (90) calendar days after the terminated their agency agreement does not
filing of the complaint, the claims: relieve the former of its liability. The reason for
this ruling was given by this Court in Catan vs.
(1) arising out of an employer-employee National Labor Relations Commission, which we
relationship; or reproduce in part as follows:
(2) by virtue of any law; or
(3) contract involving Filipino workers for This must be so, because the
overseas deployment including claims for actual, obligations covenanted in the
moral, exemplary and other forms of damage. [manning] agreement between the
Consistent with this mandate, the NLRC shall local agent and its foreign principal are
endeavor to update and keep abreast with the not coterminous with the term of such

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agreement so that if either or both of 4. 10% of the amount of withheld wages

the parties decide to end the as attorney’s fees when the withholding is
agreement, the responsibilities of such unlawful .(Art. 111, Labor Code) (Sameer
parties towards the contracted Overseas Placement Agency, Inc. v. Cabiles,
employees under the agreement do G.R. No. 170139, August 05, 2014)
not at all end, but the same extends up
to and until the expiration of the, Theory of imputed knowledge
employment contracts of the
employees recruited and employed The theory of imputed knowledge ascribes
pursuant to the said recruitment the knowledge of the agent, Sunace, to the
agreement. Otherwise, this will render principal, employer Xiong, not the other way
nugatory the very purpose for which around. (Rovels Enterprises, Inc. v. Ocampo,
the law governing the employment of G.R. No. 136821, October 17, 2002, 391 SCRA
workers for foreign jobs abroad was 176; vide Air France v. Court of Appeals, et
enacted. (Pentagon International al., 211 Phil. 601 [1983]) The knowledge of the
Shipping Services, Inc. v. The Court principal-foreign employer cannot, therefore, be
of Appeals, G.R. No. 169158, July 1, imputed to its agent Sunace. (Sunace Int’l Mgmt.
2015) Services Inc. v. NLRC, G.R. No. 161757, January
25, 2006, cited in the subsequent case of APQ
SRL International Manpower Agency v. Shipmanagement Co., LTD, v. Caseñas, G. R. No.
Yarza, Jr., G.R. No. 207828, February 14, 197303, June 4, 2014)
2022: One of the safeguards incorporated in
R.A. No. 8042 is found in Sec. 10 which Who may participate in the private sector
provides for the solidary and continuing liability
of recruitment agencies against monetary claims Only the following persons or entities in
of migrant workers. the private sector may engage in the recruitment
and placement of workers either for local or
xxx overseas employment:

This responsibility exists during the (a) Private employment agencies;

lifetime of the employment contract and shall (b) Private recruitment entities;
continue despite substitution, amendment or (c) Shipping or manning agents or
modification of the agreement. (Id., citing third representatives; and
paragraph of Section 10, R.A. No. 8042.) (d) Such other persons or entities as may
be authorized by the Secretary. (Rule IV,
Reliefs in case of termination of overseas Section 1, Book I, Rules to Implement the
employment without just, valid or authorized Labor Code)
cause
The participation of the private sector in
2012 and 2009 Bar Examinations recruitment and placement activities is
authorized under Article 25 of the Labor Code.
The reliefs granted by law to the illegally This is very clear according to Article 16 of the
dismissed OFWs are as follows: Labor Code which provides, “Except as provided
in Chapter II of this Title xxx”. The provisions
1. Salary for the unexpired portion of the under Chapter II of Title I Book I of the Labor
employment contract violated together with Code covers the specific regulations on the
attorney’s fees and reimbursement of amounts participation of the private sector in recruitment
withheld from her salary; and placement activities.

2. Full reimbursement of his placement Disqualifications to engage in recruitment

fee with interest of twelve (12%) per annum and placement for overseas employment
(Section 10 of Republic Act No. 8042, otherwise
known as the Migrant Workers and Overseas 2006 Bar Examination
Filipinos Act of 1995); and
Under the Labor Code, travel agencies and
3. That “repatriation of the worker and the sales agencies of airline companies are prohibited
transport of his [or her] personal belongings from engaging in the business of recruitment and
shall be the primary responsibility of the agency placement of workers for overseas employment
which recruited or deployed the worker whether for profit or not. (Art. 26)
overseas.” The exception is when “termination of
employment is due solely to the fault of the The following persons and entities are
worker,” (Rep. Act. No. 8042 (1995), sec. 15.) disqualified to participate or engage in the
recruitment and placement of workers for
overseas employment:

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1. Travel agencies and sales agencies of 7. Any official or employee of the DOLE,
airline companies (Section 3[a], Rule I, Part II, POEA, OWWA, DFA, DOJ, DOH, BI, IC, NLRC,
Revised POEA Rules and Regulations TESDA, CFO, NBI, PNP, Civil Aviation Authority
Governing the Recruitment and Employment of of the Philippines (CAAP), international airport
Landbased Overseas Filipino Worker of 2016 authorities, and other government agencies
and Section 3[a], Rule I Part II, 2016 Revised directly involved in the implementation of RA
POEA Rules and Regulations Governing the 8042, as amended, and/or any of his/her
Recruitment and Employment of Seafarers) relatives within the fourth civil degree of
consanguinity or affinity. (Section 3[f], Rule I,
2. Officers or members of the Board of Part II, Revised POEA Rules and Regulations
any corporation or partners in a partnership Governing the Recruitment and Employment of
engaged in the business of a travel agency Landbased Overseas Filipino Worker of 2016
(Section 3[b], Rule I, Part II, Revised POEA and Section 3[g], Rule I Part II, 2016 Revised
Rules and Regulations Governing the POEA Rules and Regulations Governing the
Recruitment and Employment of Landbased Recruitment and Employment of Seafarers)
Overseas Filipino Worker of 2016 and Section
3[b], Rule I Part II, 2016 Revised POEA Rules Those considered with derogatory records
and Regulations Governing the Recruitment and
Employment of Seafarers) The derogatory records refers to the
existence of negative information such as but
3. Corporations and partnerships, where not limited to the following:
any of its officers, members of the board or
partners is also an officer, member of the board 1) Those certified to have derogatory
or partner of a corporation or partnership record or information by the National
engaged in the business of a travel agency Bureau of investigation or by the Anti-
(Section 3[c], Rule I, Part II, Revised POEA Illegal Recruitment Branch of the POEA;
Rules and Regulations Governing the 2) Those against whom probable
Recruitment and Employment of Landbased cause or prima facie finding of guilt for
Overseas Filipino Worker of 2016 and Section illegal recruitment or other related cases
3[d], Rule I, Part II, Revised POEA Rules and exists;
Regulations Governing the Recruitment and 3) Those convicted for illegal
Employment of Landbased Overseas Filipino recruitment or other related cases
Worker of 2016); and/or crimes involving moral turpitude;
and
4. The applicant is presently an 4) Those agencies whose licenses
incorporator, director or key officer of at least have been previously revoked or
five (5) licensed manning agencies (Section 3[c], cancelled by the Administration for
Rule I Part II, 2016 Revised POEA Rules and violation of RA 8042, PD 442 as
Regulations Governing the Recruitment and amended and their implementing rules
Employment of Seafarers); and regulations as well as these rules
and regulations. (Part II, Section 2,
5. Individuals, partners, officers or Rule I, 2002 POEA Rules and
directors of an insurance company who make, Regulations Governing the
propose or provide an insurance contract under Recruitment and Employment of
the compulsory insurance coverage for agency- Land-Based Overseas Workers and
hired Overseas Filipino Workers (for seafarers) Part II, Section 2, Rule I, 2003 POEA
(Section 3 [d], Rule I, Part II, Revised POEA Rules and Regulations Governing
Rules and Regulations Governing the Recruitment and Employment of
Recruitment and Employment of Landbased Seafarers)
Overseas Filipino Worker of 2016 and Section
3[e], Rule I Part II, 2016 Revised POEA Rules Qualifications for overseas recruitment and
and Regulations Governing the Recruitment and placement
Employment of Seafarers);
Only those who possess the following
6. Sole proprietors, partners or officers qualifications may be permitted to engage in the
and members of the board with derogatory business of recruitment and placement of
records (Section 3[e], Rule I, Part II, Revised Filipino workers:
POEA Rules and Regulations Governing the
Recruitment and Employment of Landbased As to citizenship
Overseas Filipino Worker of 2016 and Section
3[f], Rule I Part II, 2016 Revised POEA Rules and a. Only Filipino citizens or corporations,
Regulations Governing the Recruitment and partnerships or entities at least seventy-five
Employment of Seafarers); percent (75%) of the authorized and voting

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capital stock of which is owned and controlled by additional offices anywhere shall be subject to the
Filipino citizens shall be permitted to participate prior approval of the Department of Labor. (Art.
in the recruitment and placement of workers, 29, Labor Code)
locally or overseas. (Art. 27. Labor Code)
Jurisdiction of DOLE to suspend or cancel
As to capitalization license or authority

A minimum capitalization of Five Million 2012 Bar Examination

Pesos (P5,000,000.00) in case of a single
proprietorship or partnership and a minimum In Trans Action Overseas Corporation
paid-up capital of Five Million Pesos v. The Honorable Secretary of Labor, G.R.
(P5,000,000.00. (Part II, Section 2, Rule I, 2016 No. 109583, September 5, 1997, the issue
Revised POEA Rules and Regulations presented is whether or not the Secretary of
Governing Recruitment and Placement of Labor and Employment has jurisdiction to cancel
Land-Based Overseas Workers of 2016 and or revoke the license of a private fee-charging
Part II, Section 2, Rule I, 2003 Revised POEA employment agency. In resolving the issue, the
Rules and Regulations Governing High Court ruled:
Recruitment and Placement of Seafarers)
The power to suspend or cancel any
Qualifications for local recruitment and license or authority to recruit employees
placement for overseas employment is vested upon
the Secretary of Labor and Employment.
2002 Bar Examination Article 35 of the Labor Code, as
amended, which provides:
The applicant for a license to operate a
private employment agency must possess the xxx
following:
In the case of Eastern Assurance
a. Filipino citizens for single and Surety Corp. v. Secretary of
proprietorship and seventy five Labor, 181 SCRA 110 (1990) we held
percent (75%) of the authorized that:
capital stock is owned and
controlled by Filipino citizens for “The penalties of
partnership and corporation. suspension and cancellation of
b. Minimum net worth of license or authority are
P1,000,000.00 in case of single prescribed for violations of the
proprietorship and a minimum paid above quoted provisions,
up capital of P1,000,000.00 in case among others. And the
of partnership and corporation; and Secretary of Labor has the
c. Not otherwise disqualified by law or power under Section 35 of the
other government rules and law to apply these sanctions, as
regulations to engage in the well as the authority, conferred
business of recruitment and by Section 36, not only to
placement of workers for local ‘restrict and regulate the
employment. (Section 4, Revised recruitment and placement
Rules and Regulations Governing activities of all agencies,’ but
Recruitment and Placement for also to ‘promulgate rules and
Local Employment [Department regulations to carry out the
Order No. 141-14 Series of 2014] objectives and implement the
issued on November 20,2014) provisions’ governing said
activities. Pursuant to this rule-
Rule on non-transferability of license or making power thus granted, the
authority Secretary of Labor gave the
POEA, (Sec. 1, Rule II, Book VI
1998 Bar Examination of the New Rules on Overseas
Employment) ‘on its own
No license or authority shall be used initiative or upon filing of a
directly or indirectly by any person other than the complaint or report or upon
one in whose favor it was issued or at any place request for investigation by any
other than that stated in the license or authority aggrieved person, x x (authority
be transferred, conveyed or assigned to any to) conduct the necessary
other person or entity. Any transfer of business proceedings for the suspension
address, appointment or designation of any agent or cancellation of the license or
or representative including the establishment of authority of any agency or entity’

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for certain enumerated offenses deemed committed by a syndicate if carried out

including - by a group of three (3) or more persons
conspiring and/or confederating with one
xxx another in carrying out any unlawful or illegal
transaction, enterprise or scheme defined under
This power conferred upon the the first paragraph hereof. Illegal recruitment is
Secretary of Labor and Employment deemed committed in large scale if committed
was echoed in People v. Diaz, 259 against three (3) or more persons individually or
SCRA 441 (1996) viz.: as a group. (Art. 38 [b])

“A non-licensee or non- Types of illegal recruitment under the Labor

holder of authority means any Code and RA 8042, as amended
person, corporation or entity
which has not been issued a 2007 Bar Examination
valid license or authority to
engage in recruitment and Under the Labor Code, which applies for
placement by the Secretary of local employment, the types of illegal
Labor, or whose license or recruitment are as follows:
authority has been suspended,
revoked or cancelled by the a. Simple illegal recruitment - Any
POEA or the Secretary.” recruitment activities, including the
(Underscoring supplied) prohibited practices enumerated
under Article 34 of this Code, to be
xxx undertaken by non-licensees or non-
holders of authority, shall be deemed
The concurrent jurisdiction of the illegal and punishable under Article
Department of Labor and Employment (DOLE) 39 of this Code. The Department of
and the Philippine Overseas Employment Labor and Employment or any law
Administration (POEA) was also affirmed by the enforcement officer may initiate
Supreme Court in the case of Romero v. complaints under this Article. (Art. 38
People, G.R. No. 171644, November 23, [a])
2011citing Eastern Assurance and Surety
Corp. v. Secretary of Labor and People v. b. Illegal recruitment when committed
Diaz. by a syndicate or in large scale shall
be considered an offense involving
Illegal recruitment constituting economic economic sabotage and shall be
sabotage penalized in accordance with Article
39 hereof.
2015, 2011, 2010, 2007, 2005 and 2002
Bar Examinations Illegal recruitment is deemed
committed by a syndicate if carried
In overseas employment, the recruitment out by a group of three (3) or more
of workers becomes an act of economic persons conspiring and/or
sabotage when committed as follows: confederating with one another in
carrying out any unlawful or illegal
1. By a syndicate - Illegal recruitment is transaction, enterprise or scheme
deemed committed by a syndicate if carried out defined under the first paragraph
by a group of three (3) or more persons hereof. Illegal recruitment is deemed
conspiring or confederating with one another. committed in large scale if committed
against three (3) or more persons
2. In a large scale - It is deemed individually or as a group. (Art. 38 [b])
committed in large scale if committed against
three (3) or more persons individually or as a However, for overseas recruitment, the
group. (Section 6, RA 8042 as amended by following are the types of illegal recruitment
RA 10022; Section 2, Rule IV, Omnibus Rules under RA 8042, as further amended by RA
and Regulations Implementing the Migrant 10022:
Workers and Overseas Filipinos Act of 1995)
1. Simple illegal recruitment;
While under the Labor Code, which 2. Offense involving economic sabotage
applies for local employment, when committed when committed as follows:
by a syndicate or in large scale shall be
considered an offense involving economic By a syndicate - Illegal recruitment is
sabotage and shall be penalized in accordance deemed committed by a syndicate if carried out
with Article 39 hereof. Illegal recruitment is

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by a group of three (3) or more persons (Article 40, Labor Code) Note that the alien
conspiring or confederating with one another. employment permit is only required for non-
resident aliens.
In a large scale - It is deemed committed
in large scale if committed against three (3) or
more persons individually or as a group.
(Section 6, RA 8042 as amended by RA
10022; Section 2, Rule IV, Omnibus Rules
and Regulations Implementing the Migrant
Workers and Overseas Filipinos Act of 1995)

Distinctions of illegal recruitment under RA

8042, as amended by RA 10022, and the
Labor Code

Illegal recruitment under Section RA

8042, Migrant Workers and Overseas Filipinos
Act of 1995, as amended by RA 10022,
broadened the concept of illegal recruitment
(People vs. Gamboa, G.R. No. 135382,
September 29,2000), as it includes the
commission of acts (letters a to n in the second
sentence of the first paragraph of Section 6 of
RA 8042, as amended) whether committed by
any person, whether a non-licensee, non-
holder of authority, licensee or holder of
authority, and provided for stiffer penalties
(Ibid), while illegal recruitment as defined by
Article 38 (a) in relation to Article 13 (b) and 34
of the Labor Code is committed only by a non-
licensees or non-holders of authority.

By its terms, persons who engage in

“canvassing, enlisting, contracting, transporting,
utilizing, hiring, or procuring workers” without
the appropriate government license or
authority are guilty of illegal recruitment
whether or not they commit the wrongful
acts enumerated in that section. On the other
hand, recruiters who engage in the canvassing,
enlisting, etc. of OFWs, although with the
appropriate government license or authority,
are guilty of illegal recruitment only if they
commit any of the wrongful acts enumerated
in Section 6 of RA 8042 as amended. (Republic
of the Philippines vs. Philippine Association
of Service Exporters Inc. (PASEI), G.R. No.
167590, November 12,2013 consolidated with
other cases)

Coverage of alien employment permit

2017, 2007 and 1995 Bar Examinations

Any alien seeking admission to the

Philippines for employment purposes and any
domestic or foreign employer who desires to
engage an alien for employment in the
Philippines shall obtain an employment permit
from the Department of Labor and Employment.

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Apprenticeship and learnership, distinguished

2017, 2016 and 2011 Bar Examinations

Distinctions Apprenticeship Learnership

As to the In Apprenticeship, the In learnership, the agreement entered by the
agreement agreement entered by the parties is known as Learnership Agreement
parties is known as (75, Labor Code);
Apprenticeship Agreement.
(Articles 58 [d], Labor Code);
As to the period of In Apprenticeship, the In learnership, the agreement period shall not
agreement agreement shall not be less than be more than three months; (Article 75 (b),
four (4) months and not more Labor Code, 3.10, TESDA Circular No. 16,
than six (6) months; (Articles 58 Series of 2004);
[c] in relation to Article 61 and
3.10, TESDA Circular No. 16,
Series of 2004);
As to obligations to In apprenticeship, the enterprise In learnership, the enterprise is obliged to hire
hire is not obliged to hire the the learner after the learnership period
apprentice after the (Article 75 (d), Labor Code, 3.10, TESDA
apprenticeship period; (Articles Circular No. 16, Series of 2004);
61, Labor Code, 3.10, TESDA
Circular No. 16, Series of
2004);
As to pre- In apprenticeship, upon pre- In learnership, a learner allowed or suffered to
termination of the termination of the agreement work during the first two (2) months shall be
agreement there is no regular employment deemed regular employees if training is
by operation of law; (Articles terminated by the employer before the end of
57-72, Labor Code); the stipulated period through no fault of the
learners (Article 75 (d), Labor Code);
As to the person In apprenticeship, the persons In learnership, the persons hired as trainees
hired hired as trainees is known as is known as learner (Articles 73, Labor
apprentice; (Articles 58 [b], Code, 2, TESDA Circular No. 16, Series of
Labor Code, 2, TESDA 2004);
Circular No. 16, Series of
2004);
As to the In apprenticeship, the training on In learnership, the practical training on the job
supplement on the job is with compulsory may or may not be supplemented by related
theoretical related theoretical instructions; theoretical instructions; (2, TESDA Circular
instructions (Article 58 [a], Labor Code, No. 16, Series of 2004);
Section 4 [j], R. A. 7796, and 2,
TESDA Circular No. 16, Series
of 2004);
As to the reasons In apprenticeship, the law did In learnership, the law provides the following
for hiring not provide any reasons where reasons for hiring (1) when no experienced
an apprentice may be hired workers are available; (2) the employment of
(Articles 59-72, Labor Code); 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 In learnership, the law did not provide such
qualifications are (a) At least qualifications. However, reasons or
fifteen (15) years of age; (b) justifications for hiring are provided by law
Possess vocational aptitude and (Articles 74, Labor Code);
capacity for appropriate tests;
and (c) Possess the ability to
comprehend and follow oral and
written instructions and no

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justifications or reasons given by

law for hiring; (Articles 59,
Labor Code);
As to what In apprenticeship, the In learnership, the occupations involves are
occupations hired occupations involves "highly semi-skilled and other industrial occupations
technical industries" which which are non-apprenticeable and learnable
means trade, business, occupations must be approved by TESDA
enterprise, industry, or other (Articles 73, Labor Code and 3.3, TESDA
activity, which is engaged in the Circular No. 16, Series of 2004).
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).

Definitions of terms under Republic Act No. activities and who have no means of livelihood
7277 or whose incomes fall below poverty threshold;

2012, 2007 , 2000 and 1998 Bar (l) Qualified Individual with a Disability
Examinations shall mean an individual with a disability who,
with or without reasonable accommodations,
Republic Act No. 7277 known as Magna can perform the essential functions of the
Carta for Disabled Persons’ later the title was employment position that such individual holds
amended, by Republic Act No. 9442, as the or desires. However, consideration shall be
"Magna Carta for Persons with Disability". given to the employer’s judgement as to what
The following selected terms are defined by functions of a job are essential, and if an
Republic Act No. 7277, as amended, as follows: employer has prepared a written description
before advertising or interviewing applicants for
(a) Disabled Persons are those suffering the job, this description shall be considered
from restriction of different abilities, as a result of evidence of the essential functions of the
a mental, physical or sensory impairment, to job.(Section 4, Republic Act 7277)
perform an activity in the manner or within the
range considered normal for a human being; Persons with disability as apprentices or
learners
(b) Impairment is any loss, diminution or
aberration of psychological, physiological, or 2012, 2011 and 2006 Bar Examinations
anatomical structure of function;
Subject to the provision of the Labor Code
(c) Disability shall mean (1) a physical or as amended, disabled persons shall be eligible
mental impairment that substantially limits one as apprentices or learners; Provided, That their
or more psychological, physiological or handicap is not much as to effectively impede
anatomical function of an individual or activities the performance of job operations in the
of such individual; (2) a record of such an particular occupation for which they are hired;
impairment; or (3) being regarded as having Provided, further, That after the lapse of the
such an impairment; period of apprenticeship if found satisfactory in
the job performance, they shall be eligible for
(d) Handicap refers to a disadvantage for employment. (Section 7, Republic Act No.
a given individual resulting from an impairment 7277)
or a disability, that limits or prevents the
functions or activity, that is considered normal Wage rate of persons with disability
given the age and sex of the individual;
2013 and 1998 Bar Examinations
j) Auxiliary Social Services are the
supportive activities in the delivery of social A qualified disabled employee shall be
services to the marginalized sectors of society; subject to the same terms and conditions of
employment and the same compensation,
(k) Marginalized Disabled Persons refer to privileges, benefits, fringe benefits,
disabled persons who lack access to incentives or allowances as a qualified able-
rehabilitative services and opportunities to be bodied person. (second sentence, Section 5,
able to participate fully in socioeconomic Republic Act No. 7277) This means that
persons with disability are entitled to 100% of

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the applicable minimum wage. However, if they engagement of the employee; (b) the payment
are employed as apprentices or learners their of wages; (c) the power to dismiss; and (d) the
wage rate shall be not less that 75% of the power to control the employee's conduct. The
applicable minimum wage. (Articles 61 and75 power of control is the most significant factor in
of the Labor Code) But if they are employed as the four-fold test. (Ditiangkin v. Lazada E-
learners in piece or incentive-rate jobs they are Services, G.R. No. 246892, September 21,
entitled to be paid in full or 100% of the 2022)
minimum wage. (Article 76 of the Labor Code)
The most crucial and determinative factor
Incentives for Employer of employment relationship

2013 Bar Examination 2019, 2015, 2011, 2003 and 1999 Bar
Examinations
The following are the incentives to the
employer: The power of control is the most
significant factor in the four-fold test. The right to
(a) To encourage the active participation control extends not only over the work done but
of the private sector in promoting the welfare of over the means and methods by which the
disabled persons and to ensure gainful employee must accomplish the work. The power
employment for qualified disabled persons, of control does not have to be actually exercised
adequate incentives shall be provided to private by the employer. It is sufficient that the employer
entities which employ disabled persons. "has a right to wield the power." (Ditiangkin v.
Lazada E-Services, G.R. No. 246892,
(b) Private entities that employ disabled September 21, 2022)
persons who meet the required skills or
qualifications, either as regular employee, 2. The economic dependence test
apprentice or learner, shall be entitled to an
additional deduction, from their gross income, The proper standard of economic dependence
equivalent to twenty-five percent (25%) of the is whether the worker is dependent on the alleged
total amount paid as salaries and wages to employer for his continued employment in that
disabled persons: Provided, however, That such line of business. (Francisco v. NLRC, G.R. No.
entities present proof as certified by the 170087, August 31, 2006)
Department of Labor and Employment that
disabled person are under their employ. 3. The two-tiered test
Provided, further, That the disabled employee is
accredited with the Department of Labor and a. A combination of control test and
Employment and the Department of Health as to economic dependency test according to the
his disability, skills and qualifications. case of Francisco v. NLRC, G.R. No. 170087,
August 31, 2006;
(c) Private entities that improved or modify
their physical facilities in order to provide b. A combination of the four-fold test and
reasonable accommodation for disabled persons the and economic dependency test) according to
shall also be entitled to an additional deduction the case of Ditiangkin v. Lazada E-Services, Inc.,
from their net taxable income, equivalent to fifty G.R. No. 246892, September 21, 2022.
percent (50%) of the direct costs of the
improvements or modifications. This section, Existence of employer-employee relationship
however, does not apply to improvements or cannot be expressly repudiated
modifications of facilities required under Batas
Pambansa Bilang 344. (Section 8, Republic 2019, 2010 and 2000 Bar Examinations
Act No. 7277)
Century Properties, Inc. v. Babiano, G.
Test of employer-employee relationship R. No. 220978,July 5, 2016: In the case of
Insular Life Assurance Co., Ltd. v. NLRC, 350
1. Traditional four-fold test of employer Phil. 918 (1998) it was ruled that one's
employee relationship employment status is defined and prescribed by
law, and not by what the parties say it should be,
2022, 2017, 2016, 2014, 2011, 2010, viz.: It is axiomatic that the existence of an
2008, 2002, 1996 and 1991 Bar Examinations employer-employee relationship cannot be
negated by expressly repudiating it in the
Under the four-fold test, to establish an management contract and providing therein that
employer-employee relationship, four factors the "employee" is an independent contractor
must be proven: (a) the employer's selection and when the terms of the agreement clearly show

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otherwise. For, the employment status of a of the so-called “boundary” they pay to the
person is defined and prescribed by law and owner/operator is not sufficient to withdraw the
not by what the parties say it should be. In relationship between them from that of employer
determining the status of the management and employee. We have applied by analogy
contract, the "four-fold test" on employment the above-stated doctrine to the
earlier mentioned has to be applied. (Id. at 926) relationships between bus owner/operator
(Emphasis and underscoring supplied) and bus conductor, auto-calesa
owner/operator and driver, and recently
In finding the existence of employer- between taxi owners/operators and taxi
employee relationship not on the basis of an drivers. Hence, petitioners are undoubtedly
agreement the Honorable Supreme Court in employees of private respondent because as
Diamond Farms Inc. v. Southern Philippines taxi drivers they perform activities which are
Federation of Labor (SPFL)-Workers Solidarity usually necessary or desirable in the usual
of DARBMUPCO/Diamond-SPFL, citing Tabas business or trade of their employer[.]
v. California Manufacturing Co., Inc., G.R. No. L- (Emphasis supplied)
80680 January 26, 1989, ruled in this wise: The
existence of an employer-employees relation Working scholars
is a question of law and being such, it cannot
be made the subject of agreement. Hence, the 1997 Bar Examination
fact that the manpower supply agreement
between Livi and California had specifically There is no employer-employee
designated the former as the petitioners’ relationship between students on one hand, and
employer and had absolved the latter from any schools, colleges or universities on the other,
liability as an employer, will not erase either where there is written agreement between them
party’s obligations as an employer, if an under which the former agree to work for the
employer-employee relation otherwise exists latter in exchange for the privilege to study free
between the workers and either firm. xxx. of charge, provided the students are given real
[Emphasis supplied] opportunities, including such facilities as may be
reasonable and necessary to finish their chosen
Kind of relationship under a "boundary courses under such agreement. (Section 14
system" arrangement Rule X Book III, Rules to Implement the
Labor Code)
2017 Bar Examination
Employer-employee relationship in job
In the En Banc case of Republic of the contracting and labor-only contracting
Philippines v. Maria Basa Express Jeepney
Operators and Drivers Association, Inc., G.R. In Vigilla v. Philippine College of
No. 206486, August 16, 2022 the Supreme Criminology, Inc., G.R. No. 200094, June 10,
Court ruled citing (see footnote 270) the ruling in 2013 citing Philippine Bank of
Jardin v. National Labor Relations Commission, Communications v. NLRC, 230 Phil. 430
383 Phil. 187, 197-198 (2000) is clear: In a (1986) the Supreme Court explained the legal
number of cases decided by this Court, we effects of a job-only contracting and labor-only
ruled that the relationship between jeepney contracting, to wit:
owners/operators[,] on one hand[,] and
jeepney drivers[,] on the other[,] under the Under the general rule set out in
boundary system is that of employer- the first and second paragraphs of
employee and not of lessor-lessee. We Article 106, an employer who enters into
explained that in the lease of chattels, the lessor a contract with a contractor for the
loses complete control over the chattel leased performance of work for the employer,
although the lessee cannot be reckless in the does not thereby create an employer-
use thereof, otherwise he would be responsible employees relationship between himself
for the damages to the lessor. In the case of and the employees of the contractor.
jeepney owners/operators and jeepney drivers, Thus, the employees of the contractor
the former exercise supervision and control over remain the contractor's employees and
the latter. The management of the business is his alone. Nonetheless when a
in the owner’s hands. The owner[,] as holder contractor fails to pay the wages of his
of the certificate of public convenience[,] employees in accordance with the Labor
must see to it that the driver follows the Code, the employer who contracted out
route prescribed by the franchising authority the job to the contractor becomes jointly
and the rules promulgated as regards its and severally liable with his contractor to
operation. Now, the fact that the drivers do not the employees of the latter "to the extent
receive fixed wages but get only that in excess of the work performed under the

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Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
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contract" as such employer were the The workers paid by results, referred by
employer of the contractor's employees. Article 82, which are excluded in Book III of the
The law itself, in other words, Labor Code are those who are paid on piece-
establishes an employer-employee work, "takay," "pakiao" or task basis, and other
relationship between the employer and non-time work. (Section 2 [e], Rule I, Book III,
the job contractor's employees for a Rules to Implement the Labor Code) They are
limited purpose, i.e., in order to ensure excluded from the benefits of Book III “if their
that the latter get paid the wages due to output rates are in accordance with the
them. standards prescribed under Section 8, Rule VII,
Book Three of these regulations, or where such
A similar situation obtains where rates have been fixed by the Secretary of Labor
there is "labor only" contracting. The and Employment in accordance with the
"labor-only" contractor-i.e "the person or aforesaid Section”. [Underscore supplied]
intermediary" - is considered "merely as (Section 2 [e], Rule I, Book III, Rules to
an agent of the employer." The Implement the Labor Code) In interpreting the
employer is made by the statute exclusion of workers who are paid by results
responsible to the employees of the including those who are paid on piece-
"labor only" contractor as if such work, takay, pakiao, or task basis from the
employees had been directly employed benefits of Book III, specifically the overtime
by the employer. Thus, where "labor- pay, the Supreme Court in Labor Congress of
only" contracting exists in a given case, the Philippines v. NLRC, G. R. No.
the statute itself implies or establishes 123938. May 21, 1998, explained the
an employer-employee relationship application of Section 2 [e], Rule I, Book III,
between the employer (the owner of the Rules to Implement the Labor Code as follows:
project) and the employees of the "labor
only" contractor, this time for a As to overtime pay, the rules,
comprehensive purpose: "employer for however, are different. According to
purposes of this Code, to prevent any Sec. 2(e), Rule I, Book III of the
violation or circumvention of any Implementing Rules, workers who are
provision of this Code." The law in effect paid by results including those who are
holds both the employer and the "labor- paid on piece-work, takay, pakiao, or
only" contractor responsible to the task basis, if their output rates are in
latter's employees for the more effective accordance with the standards
safeguarding of the employees' rights prescribed under Sec. 8, Rule VII, Book
under the Labor Code. (Id. at 439-440) III, of these regulations, or where such
[Emphasis supplied]. rates have been fixed by the Secretary
of Labor in accordance with the
Coverage of Title I of Book III (Working aforesaid section, are not entitled to
Conditions and Rest Periods) receive overtime pay.

It shall apply to employees in all Concept of field personnel

establishments and undertakings whether for
profit or not. (Article 82, Labor Code) 1992 Bar Examination

Exemption from coverage of Title I, Book III "Field personnel" shall refer to non-
of the Labor Code agricultural employees who regularly perform
their duties away from the principal place of
2012 and 2002 Bar Examinations business or branch office of the employer and
whose actual hours of work in the field cannot
The government employees, managerial be determined with reasonable certainty. (Third
employees, field personnel, members of the paragraph, Art. 82, Labor Code)
family of the employer who are dependent on
him for support, domestic helpers, persons in Rule to conclude that an employee is a field
the personal service of another, and workers personnel
who are paid by results. (Article 82, Labor
Code) At this point, it is necessary to stress that
the definition of a "field personnel" is not merely
Workers who are paid by results concerned with the location where the employee
regularly performs his duties but also with the fact
2011 Bar Examination that the employee's performance is unsupervised
by the employer. As discussed above, field
personnel are those who regularly perform their

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duties away from the principal place of business board its vessel. Although they perform non-
of the employer and whose actual hours of work agricultural work away from petitioner’s
in the field cannot be determined with reasonable business offices, the fact remains that
certainty. Thus, in order to conclude whether an throughout the duration of their work they are
employee is a field employee, it is also necessary under the effective control and supervision of
to ascertain if actual hours of work in the field can petitioner through the vessel’s patron or
be determined with reasonable certainty by the master. (Mercidar Fishing Corporation vs.
employer. In so doing, an inquiry must be made NLRC, G.R. No. 112574, 8 October 1998)
as to whether or not the employee's time and
performance are constantly supervised by the 3. TRUCK/TRAILER DRIVER - The
employer. (Dasco v. Philtranco Service employee in one case was not a field
Enterprises Inc., G. R. No. 211141, June 29, personnel, as he was based at the principal
2016) office, with actual work hours (from 6:00 a.m.
to 6:00 p.m.) that were ascertainable with
reasonable certainty. He averaged 21 trips
per month. And if not driving for the company,
Employees whose time/performance are he was paid P125.00 per day for cleaning
constantly supervised by employer and maintaining the company's equipment.
(Duterte vs. Kingswood Trading Co., Inc.,
By established jurisprudence, the G.R. No. 160325, 4 October 2007)
following employees, although performing
their duties away from the principal place of Exceptions to normal hours of work
business of the employer, were not
considered as field personnel because their The exceptions to normal hours of work
time and performance were constantly are the different types of flexible work
supervised by the employer: arrangements. The Department of Labor and
Employment issued Department Advisory No. 2
1. BUS DRIVER - It is of judicial notice Series of 2009 known as the Guidelines on the
that along the routes that are plied by these Adoption of Flexible Work Arrangements. It was
bus companies, there are its inspectors issued to assist and guide employers and
assigned at strategic places who board the employees in the implementation of various
bus and inspect the passengers, the punched flexible work arrangements as one of the coping
tickets, and the conductor’s reports. There is mechanisms and remedial measures in times of
also the mandatory once-a-week car barn or economic difficulties and national emergencies.
shop day, where the bus is regularly checked Adoption of flexible work arrangements is
as to its mechanical, electrical, and hydraulic considered as a better alternative than the
aspects, whether or not there are problems outright termination of the services of the
thereon as reported by the driver and/or employees or the total closure of the
conductor. They too, must be at specific establishment. Anchored on voluntary basis and
place at a specified time, as they generally conditions mutually acceptable to both the
observe prompt departure and arrival from employer and the employees, it is recognized as
their point of origin to their point of beneficial in terms of reduction of business costs
destination. In each and every depot, there is and helps in saving jobs while maintaining
always the Dispatcher whose function is competitiveness and productivity in industries.
precisely to see to it that the bus and its crew
leave the premises at specific times and Concept of flexible work arrangements
arrive at the estimated proper time. The
driver was therefore under constant Flexible work arrangements refer to
supervision while in the performance of this alternative arrangements or schedules other
work. He cannot be considered a field than the traditional or standard work hours,
personnel. (Auto Bus Transport Systems, workdays and workweek. (II, Department
Inc. v. Bautista, G.R. No. 156367, May 16, Advisory No. 2, Series of 2009)
2005)
Kinds of flexible work arrangements
2. FISHERMEN - The employer company
argued that since the work of a fisherman is The following are the flexible work
performed away from its principal place of arrangements which may be considered, among
business, it has no way of verifying his actual others:
hours of work on the vessel. However, the
SC ruled that during the entire course of their 1. Compressed Workweek refers to
fishing voyage, fishermen employed by one where the normal workweek is reduced to
petitioner have no choice but to remain on less than six (6) days but the total number of

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work-hours of 48 hours per week shall remain. limits or tolerable levels of exposure,
The normal workday is increased to more than as set in the OSHS.
eight hours but not to exceed twelve hours,
without corresponding overtime premium. The 3. The employer shall notify DOLE,
concept can be adjusted accordingly depending through the Regional Office having
on the normal workweek of the company jurisdiction over the workplace, the
pursuant to the provisions of Department adoption of the CWW scheme. The
Advisory No. 02, series of 2004, dated 2 notice shall be in DOLE CWW Report
December 2004. Form attached to this Advisory. (IV,
2. Reduction of workdays refers to one Department Advisory No. 2, Series of
where the normal workdays per week are 2004)
reduced but should not last for more than six
months. Effects of “compressed work week” which
3. Rotation of workers refers to one complies with the conditions for its validity
where the employees are rotated or alternately
provided work within the workweek. A CWW scheme which complies with
4. Forced Leave refers to one where the foregoing conditions shall have the
the employees are required to go on leave for following effects:
several days or weeks utilizing their leave
credits it there are any. 1. Unless there is more favorable
5. Broken-time schedule refers to one practice existing in the firm, work
where the work schedule is not continuous but beyond eight hours will not be
the work-hours within the day or week remain. compensable by overtime
6. Flexi-holidays schedule refers to premium provided the total
one where the employees agree to avail the number of hours worked per day
holidays at some other days provided there is no shall not exceed twelve (12)
diminution of existing benefits as a result of such hours. In any case, any work
arrangement. (III, Department Advisory No. 2, performed beyond 12 hours a day
Series of 2009) or 48 hours a week shall be
subject to overtime premium.
Conditions of “compressed work week”
2. Consistent with Article 85 of the
2005 Bar Examination Labor Code, employees under a
CWW scheme are entitled to meal
The specific guidelines or conditions on periods of not less than sixty (60)
Compressed Work Week (CWW) scheme are as minutes. Nothing herein shall
follows: impair the right of employees to
rest days as well as to holiday
1. The CWW scheme is undertaken as pay, rest day pay or leaves in
a result of an express and voluntary accordance with law or applicable
agreement of majority of the covered collective bargaining agreement
employees or their duly authorized or company practice.
representatives. This agreement may
be expressed through collective 3. Adoption of the CWW scheme
bargaining or other legitimate shall in no case result in
workplace mechanisms of diminution of existing benefits.
participation such as labor Reversion to the normal eight-
management councils, employee hour workday shall not constitute
assemblies or referenda. a diminution of benefits. The
reversion shall be considered a
2. In firms using substances, legitimate exercise of
chemicals and processes or operating management prerogative,
under conditions where there are provided that the employer shall
airborne contaminants, human give the employees prior notice of
carcinogens or noise prolonged such reversion within a
exposure to which may pose hazards reasonable period of time. (IV,
to the employees’ health and safety, Department Advisory No. 2,
there must be a certification from an Series of 2004)
accredited health and safety
organization or practitioner or from the Principles in determining hours worked
firm’s safety committee that work
beyond eight hours is within threshold

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The following general principles shall An employee who is not required to leave
govern in determining whether the time spent by word at his home or with company officials where
an employee is considered hours worked for he may be reached is not working while on call.
purposes of this Rule: (Section 5 [b], Rule I, Book III, Rules to
Implement the Labor Code)
(a) All hours are hours worked which the
employee is required to give his employer, Rule on travel time
regardless of whether or not such hours are
spent in productive labor or involve physical or 2012 Bar Examination
mental exertion.
(b) An employee need not leave the The rule on travel time are as follows:
premises of the work place in order that his rest
period shall not be counted, it being enough that Travel from home to work and work to
he stops working, may rest completely and may home is not compensable
leave his work place, to go elsewhere, whether Travel office to jobsite or from jobsite to
within or outside the premises of his work place. jobsite is compensable
(c) If the work performed was Travel away from home is compensable
necessary, or it benefited the employer, or the
employee could not abandon his work at the end Night Shift Differential (NSD)
of his normal working hours because he had no
replacement, all time spent for such work shall 2011 and 2002 Bar Examinations
be considered as hours worked, if the work was
with the knowledge of his employer or Night Shift Differential (NSD) refers to the
immediate supervisor. additional compensation of ten percent (10%) of
(d) The time during which an employee an employee’s regular wage for each hour of
is inactive by reason of interruptions in his work work performed between ten o’clock in the
beyond his control shall be considered working evening to six o’clock in the morning. (Article
time either if the imminence of the resumption of 86, Labor Code /GMA Network Inc. v.
work requires the employee’s presence at the Pabriga, G. R. No. 176419, November 27,
place of work or if the interval is too brief to be 2013)
utilized effectively and gainfully in the
employee’s own interest. (Section 4, Rule I, Excluded from Night Shift Differential
Book III, Rules to Implement the Labor Code) (NSD)

Rules on waiting time spent by an employee The following are excluded from
entitlement to night shift differential:
The rules on waiting time spent by an
employee to be considered working time (a) Those of the government and any of
are as follows: its political subdivisions, including government-
owned and/or controlled corporations;
1. If waiting is an integral part of his (b) Those of retail and service
work or establishments regularly employing not more
2. The employee is required or engaged than five (5) workers;
by the employer to wait. (Section 5 [a], Rule I, (c) Domestic helpers and persons in the
Book III, Rules to Implement the Labor Code) personal service of another;
(d) Managerial employees as defined in
Rule involving “on call” Book Three of this Code;
(e) Field personnel and other employees
2004, 1997 and 1993 Bar Examinations whose time and performance is unsupervised by
the employer including those who are engaged
An employee who is required to remain on on task or contract basis, purely commission
call in the employer's premises or so close basis, or those who are paid a fixed amount for
thereto that he cannot use the time effectively performing work irrespective of the time
and gainfully for his own purpose shall be consumed in the performance thereof. (Section
considered as working while on call. (Section 5 1, Rule II, Book III, Rules to Implement the
[b], Rule I, Book III, Rules to Implement the Labor Code)
Labor Code)

When is an employee not working while on Overtime pay, defined

call
2017, 2012, 2011, 2010, 2002, 1993 and
1992 Bar Examinations

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3. For work in excess of eight (8)

Overtime pay refers to the additional hours performed on a special day which
compensation for work performed beyond eight falls on a scheduled rest day: Plus 50%
(8) hours a day. (Handbook on Worker’s of the hourly rate on said days.
Statutory Monetary Benefits, 2023 Edition, 4. For work in excess of eight (8)
page 21) hours performed on a regular holiday:
Plus 30% of the hourly rate on said days.
Excluded from overtime pay 5. For work in excess of eight (8)
hours performed on a regular holiday
2012 Bar Examinations which falls on a scheduled rest day: Plus
30% of the hourly rate on said days.
The following are excluded from overtime
pay: Stipulated Overtime Rates

(a) Government employees whether 2012 Bar Examination

employed by the National Government orany of
its political subdivision, including those Generally, the premium pay for work
employed in government-owned and/or performed on rest days, special days, or regular
controlled corporations; holidays is included as part of the regular rate of
(b) Managerial employees, if they meet all the employee in the computation of overtime pay
of the following conditions: for overtime work rendered on said days,
(c) Officers or members of a managerial especially if the employer pays only the
staff minimum overtime rates prescribed by law. The
(d) Domestic servants and persons in the employees and employer, however, may
personal service of another stipulate in their collective agreement the
(e) Workers who are paid by results, payment for overtime work at rates higher than
including those who are paid on piece-work, those provided by law. (Handbook on Worker’s
"takay," "pakiao" or task basis, and other non- Statutory Monetary Benefits, 2023 Edition,
time work if their output rates are in accordance page 22)
with the standards prescribed under Section 8,
Rule VII, Book Three of these regulations, or Undertime during his regular daily work
where such rates have been fixed by the cannot be deducted in overtime work
Secretary of Labor and Employment in
accordance with the aforesaid Section. 2022, 2010, 2003, 1997 and 1992 Bar
(f) Non-agricultural field personnel if they Examinations
regularly perform their duties away from the
principal or branch office or place of business of Undertime work on any particular day
the employer and whose actual hours of work in shall not be offset by overtime work on any other
the field cannot be determined with reasonable day. Permission given to the employee to go on
certainty. (Section 2, Rule I, Rules to leave on some other day of the week shall not
Implement the Labor Code) exempt the employer from paying the additional
compensation required in this Chapter. (Art. 88,
Computation of overtime pay Labor Code)

The Handbook on Worker’s Statutory The rule on offsetting of undertime with

Monetary Benefits, 2023 Edition, (see pages overtime has been resolved by the Supreme
21-22) provided the following guide on the Court in the case of National Waterworks and
computation of overtime pay and illustrated as Sewerage Authority v. NWSA Consolidated
follows: Unions, et al., G.R. No. L-18939, August 31,
1964 where it was held that:
The COLA shall not be included in the
computation of overtime pay. The minimum There is merit in the decision of
overtime pay rates vary according to the day respondent court that the method used
the overtime work is performed, as follows: by petitioner in offsetting the overtime
with the undertime and at the same time
1. For work in excess of eight (8) charging said undertime to the accrued
hours performed on ordinary working leave of the employee is unfair, for
days: Plus 25% of the hourly rate. under such method the employee is
2. For work in excess of eight (8) made to pay twice for his undertime
hours performed on a scheduled rest day because his leave is reduced to that
or a special day: Plus 30% of the hourly extent while he was made to pay for it
rate on said days. with work beyond the regular working

2024 Bar Review Notes on Critical Areas in Labor Law Part I by Jurists Bar Review Center. © 2024 by
Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
shall be subjected to criminal prosecution and administrative charges, including the appropriate complaint
with the Bar Confidant’s Office and IBP.
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 JURISTS BAR REVIEW CENTERTM
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hours. The proper method should be to

deduct the undertime from the accrued (a) In case of actual or impending
leave but pay the employee the emergencies caused by serious accident, fire,
overtime to which he is entitled. This flood, typhoon, earthquake, epidemic or other
method also obviates the irregular disaster or calamity to prevent loss of life and
schedule that would result if the property, or imminent danger to public safety;
overtime should be set off against the (b) In cases of urgent work to be
undertime for that would place the performed on the machinery, equipment, or
schedule for working hours dependent installation, to avoid serious loss which the
on the employee. employer would otherwise suffer;
(c) In the event of abnormal pressure of
Compulsory overtime work work due to special circumstances, where the
employer cannot ordinarily be expected to resort
2012, 2011, 2010 and 2008 Bar to other measures;
Examinations (d) To prevent loss or damage to
perishable goods;
In any of the following cases, an employer (e) Where the nature of the work requires
may require any of his employees to work continuous operations and the stoppage of work
beyond eight (8) hours a day, provided that the may result in irreparable injury or loss to the
employee required to render overtime work is employer; and
paid the additional compensation required by (f) Under other circumstances analogous
these regulations: or similar to the foregoing as determined by the
Secretary of Labor and Employment. (Article
(a) When the country is at war or when 92, Labor Code)
any other national or local emergency has been (g) When the work is necessary to avail of
declared by Congress or the Chief Executive; favorable weather or environmental conditions
(b) When overtime work is necessary to where performance or quality of work is
prevent loss of life or property, or in case of dependent thereon. (Section 6 [f], Rule III,
imminent danger to public safety due to actual or Book III, Rules to Implement the Labor Code)
impending emergency in the locality caused by
serious accident, fire, floods, typhoons, Compensation on rest day/Sunday/holiday
earthquake, epidemic or other disaster or
calamities; 2011 and 2002 Bar Examinations
(c) When there is urgent work to be
performed on machines, installations, or The Handbook on Worker’s Statutory
equipment, in order to avoid serious loss or Monetary Benefits, 2023 Edition, (see page
damage to the employer or some other causes 20) provided the following guide on the
of similar nature; computation of premium pay and illustrated as
(d) When the work is necessary to prevent follows:
loss or damage to perishable goods;
(e) When the completion or continuation The COLA shall not be included in the
of work started before the 8th hour is necessary computation of premium pay. The minimum
to prevent serious obstruction or prejudice to the statutory premium pay rates are as follows:
business or operations of the employer; or
(f) When overtime work is necessary to 1. For work performed on rest days
avail of favorable weather or environmental or on special days: Plus 30% of
conditions where performance or quality of work the daily basic rate of 100% or a
is dependent thereon. total of 130%.
2. For work performed on a rest day
In cases not falling within any of these which is also a special day: Plus
enumerated in this Section, no employee may 50% of the daily basic rate of
be made to work beyond eight hours a day 100% or a total of 150%.
against his will. (Section 4, Rule I, Book III, 3. For work performed on a regular
Rules to Implement the Labor Code) holiday which is also the
employee’s rest day (not
Exceptions where an employee can be applicable to employees who are
required to work on rest day not covered by the holiday-pay
rule): Plus 30% of the regular
2011 Bar Examination holiday rate of 200% based on
his/her daily basic wage rate or a
The employer may require his employees total of 260%.
to work on any day:

2024 Bar Review Notes on Critical Areas in Labor Law Part I by Jurists Bar Review Center. © 2024 by
Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
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12 Regular Holidays and 3 Nationwide

Special Days Excluded from coverage of holidays with pay

2012 Bar Examination 2019, 2012 and 2002 Bar Examination

According to Section 26 (a) and (b), The following are excluded from the
Chapter 7, Book I of Executive Order No. 292, coverage of holidays with pay:
otherwise known as "The Administrative
Code of 1987", as amended by Republic Act (a) Those of the government and any of
9849: the political subdivision, including government-
owned and controlled corporation;
Unless otherwise modified by law, order, (b) Those of retail and service
or proclamation, the following regular holidays establishments regularly employing less than ten
and special days shall be observed in the (10) workers;
country: (c) Domestic helpers and persons in the
personal service of another;
"(a) Regular Holidays (d) Managerial employees as defined in
Book Three of the Code;
New Year’s Day (e) Field personnel and other employees
January 1 whose time and performance is unsupervised by
Maundy Thursday the employer including those who are engaged
Movable Date on task or contract basis, purely commission
Good Friday basis, or those who are paid a fixed amount for
Movable Date performing work irrespective of the time
Eidl Fitr consumed in the performance thereof. (Section
Movable Date 1, Rule IV, Book III, Rules to Implement the
Eidl Adha Labor Code)
Movable Date
Araw ng Kagitingan
Monday nearest April 9
Labor Day Monday
nearest May 1
Independence Day
Monday nearest June 12 Rule on absences
National Heroes’ Day
Last Monday of August 2010 Bar Examination
Bonifacio Day
Monday nearest November 30 The rule on absences during holidays are
Christmas Day as follows:
December 25
Rizal Day (a) All covered employees shall be
Monday nearest December 30 entitled to the benefit provided herein when they
are on leave of absence with pay. Employees
"(b) Nationwide Special Holidays who are on leave of absence without pay on the
day immediately preceding a regular holiday
Ninoy Aquino Day may not be paid the required holiday pay if he
Monday nearest August 21 has not worked on such regular holiday.
All Saints Day (b) Employees shall grant the same
November 1 percentage of the holiday pay as the benefit
Last Day of the Year granted by competent authority in the form of
December 31 employee's compensation or social security
payment, whichever is higher, if they are not
Coverage of holidays with pay reporting for work while on such benefits.
(c) Where the day immediately preceding
Under Article 94 of the Labor Code, the the holiday is a non-working day in the
general rule is that holiday pay provisions cover establishment or the scheduled rest day of the
all employees. “To be excluded from their employee, he shall not be deemed to be on
coverage, an employee must be one of those leave of absence on that day, in which case he
that these provisions expressly exempt, strictly shall be entitled to the holiday pay if he worked
in accordance with the exemption.” (David v. on the day immediately preceding the non-
Macasio, G.R. No. 195466, July 02, 2014) working day or rest day. (Section 6, Rule IV,
Book III, Rules to Implement the Labor Code)

2024 Bar Review Notes on Critical Areas in Labor Law Part I by Jurists Bar Review Center. © 2024 by
Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
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ng Kagitingan and another 200% for Good

Holiday pay of certain employees Friday)

The following employees are entitled to However, the rule on two regular holidays
holiday pay which falls on the same was also explained in
the Explanatory Bulletin, dated March 11,
(a) Private school teachers, including 1993, issued by the Department of Labor and
faculty members of colleges and universities, Employment [DOLE], through
may not be paid for the regular holidays during Undersecretary Cresenciano B. Trajano, cited
semestral vacations. They shall, however, be by the Supreme Court in the landmark case of
paid for the regular holidays during Christmas Asian Transmission Corporation v. Court of
vacation. Appeals G.R. No. 144664, March 15, 2004.
(b) Where a covered employee, is paid The bulletin reads:
by results or output, such as payment on piece
work, his holiday pay shall not be less than his "On the correct payment of
average daily earnings for the last seven (7) holiday compensation on April
actual working days preceding the regular 9, 1993 which apart from being
holiday; Provided, However, that in no case shall Good Friday is also Araw ng
the holiday pay be less than the applicable Kagitingan, i.e., two regular
statutory minimum wage rate. holidays falling on the same
(c) Seasonal workers may not be paid day, this Department is of the
the required holiday pay during off-season when view that the covered
they are not at work. employees are entitled to at
(d) Workers who have no regular working least two hundred percent
days shall be entitled to the benefits provided in (200%) of their basic wage even
this Rule. (Section 8, Rule IV, Book III, Rules to if said holiday is unworked. The
Implement the Labor Code) first 100% represents the
payment of holiday pay on April
Rule on successive regular holidays. 9, 1993 as Good Friday and the
second 100% is the payment of
Where there are two (2) successive holiday pay for the same date
regular holidays, like Holy Thursday and Good as Araw ng Kagitingan.
Friday, an employee may not be paid for both
holidays if he absents himself from work on the Said bulletin was reproduced on
day immediately preceding the first holiday, January 23, 1998, when April 9,
unless he works on the first holiday, in which 1998 was both Maundy
case he is entitled to his holiday pay on the Thursday and Araw ng
second holiday. (Section 10, Rule IV, Book III, Kagitingan x x x x
Rules to Implement the Labor Code)
The foregoing rule are simply stated:
Rule on two regular holidays on the same
day 1. If unworked - the employee is
entitled to 200% (the first 100% represents the
2010 and 2005 Bar Examinations payment of holiday pay on April 9, 1993 as
Good Friday and the second 100% is the
An employee should receive 400% payment of holiday pay for the same date as
Araw ng Kagitingan) of their basic wage; and
Every worker shall be paid his regular
daily wage during regular holidays. (Art. 94, 2. If worked the employee is
Labor Code) As interpreted by the Rules to entitled to 300% of the basic wage. (the 100% in
Implement the Labor Code, any employee who addition to 200% represents the basic pay for
is permitted or suffered to work on any regular working not more than eight hours)
holiday, not exceeding eight (8) hours, shall be
paid at least two hundred percent (200%) of his Right to service incentive leave
regular daily wage.
2013, 2012, and 2011 Bar Examinations
Since it is a double holiday the 200%
should also be times two. Thus, the 400% of the Every employee who has rendered at
regular daily wage. In other terms, if it is least one year of service shall be entitled to a
unworked its 200% (100% for Araw ng yearly service incentive leave of five days with
Kagitingan and another 100% for Good Friday) pay. (Article 95, Labor Code and Section 2,
and if worked it should be 400% (200% for Araw

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Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
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Rule V, Book III, Rules to Implement the

Labor Code) The distinctions are as follows:

Definition of "at least one-year service" 1. The service incentive leave under
Article 95 covers every employee while the
The term "at least one-year service" shall service incentive leave under RA 10361
mean service for not less than 12 months, specifically covers domestic workers;
whether continuous or broken reckoned from the
date the employee started working, including 2. The employee can accumulate his/her
authorized absences and paid regular holidays service incentive leave under Article 95 while
unless the working days in the establishment as the service incentive leave under RA 10361 is
a matter of practice or policy, or that provided in not cumulative or carried over to the
the employment contract is less than 12 months, succeeding years;
in which case said period shall be considered as
one year. (Section 3, Rule V, Book III, Rules to 3. The service incentive leave under
Implement the Labor Code) Article 95 is commutable to its money equivalent
if not used or exhausted at the end of the year.
Exclusions from entitlement of Service (Section 5, Rule V, Book III, Rules to Implement
Incentive Leave under Book III, Rule V the Labor Code) while the service incentive
leave under RA 10361 if unused are not
The following are excluded from convertible to cash. (Section 29, Republic Act
entitlement to service incentive leave: No. 10361)

(a) Those of the government and any of Interpretation of Rule V, Section 1 (e), Book
its political subdivisions, including government- III, IRR in relation to Art. 95
owned and controlled corporations;
(b) Domestic helpers and persons in the 2010 Bar Examinations
personal service of another; (This exclusion is
no longer applicable as per Sec. 29, RA 10361) In interpreting Article 95 in relation to Rule
(c) Managerial employees as defined in V, Section 1 (e), Book III, of the IRR the
Book Three of this Code; Supreme Court in David v. Macasio, G.R. No.
(d) Field personnel and other employees 195466, July 02, 2014 explained the entitlement
whose performance is unsupervised by the of those engaged on pakyaw or task basis to
employer including those who are engaged on service incentive leave by re-visiting the
task or contract basis, purely commission basis, provisions on service incentive leave. Thus, the
or those who are paid a fixed amount for High Court elucidated the following:
performing work irrespective of the time
consumed in the performance thereof; Provisions governing SIL xxxx
(e) Those who are already enjoying the
benefit herein provided; Article 82 of the Labor Code
(f) Those enjoying vacation leave with pay provides the exclusions from the
of at least five days; and coverage of Title I, Book III of the Labor
(g) Those employed in establishments Code - provisions governing working
regularly employing less than ten employees. conditions and rest periods.
(Section 1, Rule V, Book III, Rules to
Implement the Labor Code) Art. 82. Coverage. — The
provisions of [Title I] shall
Domestic worker’s/ Kasambahay’s apply to employees in all
entitlement to service incentive leave establishments and
undertakings whether for
A domestic worker who has rendered at profit or not, but not to
least one (1) year of service shall be entitled to government employees,
an annual service incentive leave of five (5) days managerial employees, field
with pay: Provided, That any unused portion of personnel, members of the
said annual leave shall not be cumulative or family of the employer who
carried over to the succeeding years. Unused are dependent on him for
leaves shall not be convertible to cash. (Section support, domestic helpers,
29, Republic Act No. 10361) persons in the personal
service of another, and
SIL under Article 95 of the Labor Code workers who are paid by
distinguished from SIL under Section 29 of results as determined by
RA 10361 (Kasambahay Law)

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the Secretary of Labor in the viability or financial condition

appropriate regulations. of such establishment.
xxxx [emphases ours]
xxxx
“Field personnel” shall
refer to non- Section 1. Coverage. – This rule
agricultural shall apply to all employees
employees who except:
regularly perform their xxxx
duties away from the
principal place of (e) Field personnel and other
business or branch employees whose
office of the employer performance is unsupervised
and whose actual by the employer including
hours of work in the those who are engaged on
field cannot be task or contract basis, purely
determined with commission basis, or those
reasonable certainty. who are paid a fixed amount for
[emphases and performing work irrespective of
underscores ours] the time consumed in the
performance thereof. [emphasis
Among the Title I provisions are the ours]
provisions on xxxx and SIL pay (under
Article 95 of the Labor Code). Under Under these provisions, the general
Article 82, “field personnel” on one hand rule is that xxxx and SIL pay provisions
and “workers who are paid by results” cover all employees. To be excluded
on the other hand, are not covered by from their coverage, an employee must
the Title I provisions. The wordings of be one of those that these provisions
Article 82 of the Labor Code additionally expressly exempt, strictly in accordance
categorize workers “paid by results” and with the exemption.
“field personnel” as separate and
distinct types of employees who are Under the IRR, exemption from the
exempted from the Title I provisions of coverage of xxxx and SIL pay refer to
the Labor Code. “field personnel and other employees
whose time and performance is
xxxx unsupervised by the employer including
those who are engaged on task or
On the other hand, Article 95 of the contract basis[.]” Note that unlike
Labor Code and its corresponding Article 82 of the Labor Code, the IRR
provision in the IRR (Section 1, Rule V on xxxx and SIL pay do not exclude
of Book 3) pertinently provides: employees “engaged on task basis” as a
separate and distinct category from
Art. 95. Right to service employees classified as “field
incentive. (a) Every employee personnel.” Rather, these employees
who has rendered at least one are altogether merged into one
year of service shall be entitled classification of exempted employees.
to a yearly service incentive
leave of five days with pay. Because of this difference, it may be
argued that the Labor Code may be
(b) This provision shall not apply interpreted to mean that those who are
to those who are already engaged on task basis, per se, are
enjoying the benefit herein excluded from the SIL and xxxx
provided, those enjoying payment since this is what the Labor
vacation leave with pay of at Code provisions, in contrast with the
least five days and those IRR, strongly suggest. The arguable
employed in establishments interpretation of this rule may be
regularly employing less than conceded to be within the discretion
ten employees or in granted to the LA and NLRC as the
establishments exempted from quasi-judicial bodies with expertise on
granting this benefit by the labor matters.
Secretary of Labor and
Employment after considering

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However, as early as 1987 in the to apply only to those

case of Cebu Institute of Technology employees not explicitly
v. OpleG.R. No. L- 58870, 18 excluded by Section 1 of Rule
December 1987 the phrase “those who V. According to the
are engaged on task or contract basis” Implementing Rules, Service
in the rule has already been interpreted Incentive Leave shall not apply
to mean as follows: to employees classified as “field
personnel.” The phrase “other
[the phrase] should however, be employees whose performance
related with "field personnel" is unsupervised by the
applying the rule on ejusdem employer” must not be
generis that general and understood as a separate
unlimited terms are restrained classification of employees to
and limited by the particular which service incentive leave
terms that they follow xxx shall not be granted. Rather, it
Clearly, petitioner's teaching serves as an amplification of the
personnel cannot be deemed interpretation of the definition of
field personnel which refers "to field personnel under the Labor
non-agricultural employees who Code as those “whose actual
regularly perform their duties hours of work in the field cannot
away from the principal place of be determined with reasonable
business or branch office of the certainty.”
employer and whose actual
hours of work in the field cannot The same is true with
be determined with reasonable respect to the phrase “those
certainty. [Par. 3, Article 82, who are engaged on task or
Labor Code of the Philippines]. contract basis, purely
Petitioner's claim that private commission basis.” Said phrase
respondents are not entitled to should be related with “field
the service incentive leave personnel,” applying the rule on
benefit cannot therefore be ejusdem generis that general
sustained. and unlimited terms are
restrained and limited by the
In short, the payment of an particular terms that they follow.
employee on task or pakyaw basis
alone is insufficient to exclude one from The Autobus ruling was in turn the
the coverage of SIL and xxxx. They are basis of Serrano v. Santos Transit which
exempted from the coverage of Title I the CA cited in support of granting
(including the xxxx and SIL pay) only if Macasio’s petition.
they qualify as “field personnel.” The
IRR therefore validly qualifies and limits In Serrano, the Court, applying the
the general exclusion of “workers paid rule on ejusdem generis (The general
by results” found in Article 82 from the and unlimited terms are restrained
coverage of xxxx and SIL pay. This is and limited by the particular terms
the only reasonable interpretation since that they follow) declared that
the determination of excluded workers “employees engaged on task or
who are paid by results from the contract basis xxx are not
coverage of Title I is “determined by the automatically exempted from the
Secretary of Labor in appropriate grant of service incentive leave,
regulations.” unless, they fall under the
classification of field personnel.”
The Cebu Institute Technology (Serrano v. Severino Santos Transit,
ruling was reiterated in 2005 in Auto Bus supra note 22, at 492-493; emphasis
Transport Systems, Inc., v. Bautista: supplied, underscore ours) The Court
explained that the phrase “including
A careful perusal of said those who are engaged on task or
provisions of law will result in contract basis, purely commission basis”
the conclusion that the grant of found in Section 1(d), Rule V of Book III
service incentive leave has of the IRR should not be understood as
been delimited by the a separate classification of employees
Implementing Rules and to which SIL shall not be granted.
Regulations of the Labor Code Rather, as with its preceding phrase -

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“other employees whose performance is

unsupervised by the employer” - the Republic Act No. 8187 known as "Paternity
phrase “including those who are Leave Act of 1996"
engaged on task or contract basis”
serves to amplify the interpretation of 2013, 2012, 2005, 2002 Bar
the Labor Code definition of “field Examinations
personnel” as those “whose actual
hours of work in the field cannot be Coverage
determined with reasonable certainty.”
Every married male employee in
xxx the private sector shall be entitled to
paternity leave benefits of seven (7)
In short, in determining whether days with full pay for the first four
workers engaged on “pakyaw” or task deliveries by his lawful spouse under
basis” is entitled to xxx and SIL pay, the such terms and conditions as
presence (or absence) of employer hereinafter provided. The rules on
supervision as regards the worker’s time paternity leave of employees in the
and performance is the key: if the public sector shall be promulgated by
worker is simply engaged on pakyaw or the Civil Service Commission. (Section
task basis, then the general rule is that 2, Revised Implementing Rules and
he is entitled to xxx and SIL pay unless Regulations of Republic Act No. 8187
exempted from the exceptions for the Private Sector)
specifically provided under Article 94
(holiday pay) and xxxx of the Labor Conditions to entitlement of paternity leave
Code. However, if the worker engaged benefits
on pakyaw or task basis also falls within
the meaning of “field personnel” under A married male employee shall be entitled
the law, then he is not entitled to these to paternity benefits provided that:
monetary benefits.
a. he is an employee at the time of
Treatment of benefit delivery of his child;
b. he is cohabiting with his spouse at the
2011 Bar Examinations time she gives birth or suffers a miscarriage.
c. he has applied for paternity leave in
The service incentive leave shall be accordance with Section 4 hereof; and
commutable to its money equivalent if not used d. his wife has given birth or suffered a
or exhausted at the end of the year. (Section 5, miscarriage. (Section 3, Revised
Rule V, Book III, Rules to Implement the Implementing Rules and Regulations of
Labor Code) Republic Act No. 8187 for the Private Sector)

Prescriptive period of service incentive leave Period to avail paternity leave under RA 8187
(SIL)
Paternity leave benefits shall be granted
Applying Article 291 of the Labor Code in to the qualified employee after the delivery by
light of this peculiarity of the service incentive his wife, without prejudice to an employer
leave, we can conclude that the three (3)-year allowing an employee to avail of the benefit
prescriptive period commences, not at the before or during the delivery; provided, that the
end of the year when the employee becomes total number of days shall not exceed seven (7)
entitled to the commutation of his service days for each delivery. (Section 5, Revised
incentive leave, but from the time when the Implementing Rules and Regulations of
employer refuses to pay its monetary Republic Act No. 8187 for the Private Sector)
equivalent after demand of commutation or
upon termination of the employee's services, NOTE: The Revised Implementing Rules and
as the case may be. (Rodriguez v. Park N Regulations of Republic Act No. 8187 for the
Ride, G. R. No. 222980, March 20, 2017, citing Private Sector already deleted that proviso
Auto Bus Transport System, Inc. v. Bautista, which requires that this benefit shall be availed
497 Phil. 863 (2005) [Per J. Chico-Nazario, of not later than sixty (60) days after the date of
Second Division]) said delivery.
Maternity Leave under Republic Act No.
11210

Other leaves provided by law

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2018, 2015, 2012, 2010, 2005 and 2000 (ii) salary differential to be paid by the
Bar Examinations employer, if any;

Coverage of RA 11210, the Expanded 3. An option to extend for an additional

Maternity Leave Law thirty (30) days without pay in case of live
childbirth;
The 105-Day Expanded Maternity Leave
Law (EMLL) shall cover the following: 4. Paid maternity leave, allowances
and benefits granted to female national
1. Female workers in the Public Sector; athletes; and
2. Female workers in the Private Sector;
3. Female workers in the Informal 5. Health care services for pre-natal,
Economy; delivery, postpartum and pregnancy-
4. Female members who are voluntary related conditions granted to female
contributors to the Social Security System(SSS); workers, particularly those who are
and 5. Female national athletes. (Section 1, neither voluntary nor regular members of
Rule III, IRR, RA 11210) the SSS, as governed by the existing
rules and regulations of the Philippine
Benefits granted by RA 11210, the Expanded Health Insurance Corporation
Maternity Leave Law (PhilHealth). (Section 1, Rule III, IRR, RA
11210)
The following benefits are granted under
the 105-Day Expanded Maternity Leave Law Rule on the grant of maternity leave
(EMLL) to the corresponding sectors: under RA 11210, the Expanded
Maternity Leave Law
1. Paid leave benefit granted to a
qualified female worker in the public All covered females regardless of civil
sector, for the duration of: status, employment status, and the
legitimacy of her child, shall be granted
a. One Hundred Five (105) days for one hundred five(105) days maternity
live childbirth, regardless of the mode leave with full pay, and an additional
of delivery, and an additional fifteen fifteen (15) days with full pay in case the
(15) days paid leave if the female female worker qualifies as a solo parent
worker qualifies as a solo parent under under Republic Act No. 8972,or the "Solo
Republic Act No. 8972, or the "Solo Parents' Welfare Act of 2000". (1st par.
Parents' Welfare Act of 2000"; or Section 1, Rule IV, IRR, RA 11210)
b. Sixty (60) days paid leave for
miscarriage and emergency In cases of miscarriage or emergency
termination of pregnancy; termination of pregnancy, sixty (60) days
maternity leave with full pay shall be
2. Paid leave benefit granted to a granted. (2nd par. Section 1, Rule IV,
qualified female worker in the private IRR, RA 11210)
sector covered by the SSS, including
those in the informal economy, for the Manner of enjoyment of the benefit under RA
duration of: 1121, the Expanded Maternity Leave Law

a. One Hundred Five (105) days for Enjoyment of maternity leave cannot be
live childbirth, regardless of the mode deferred but should be availed of either before
of delivery, and an additional fifteen or after the actual period of delivery in a
(15) days paid leave if the female continuous and uninterrupted manner, and such
worker qualifies as a solo parent under that:
Republic Act No. 8972, or the "Solo
Parents' Welfare Act of 2000"; or a. In cases of live childbirth, one
b. Sixty (60) days paid leave for hundred five (105) days maternity leave
miscarriage and emergency with full pay shall be granted; or
termination of pregnancy; b. In cases of miscarriage or
emergency termination of pregnancy,
Employed female workers shall sixty (60) days maternity leave shall be
receive full pay which consists of (i) granted.
SSS maternity benefit computed based
on their average daily salary credit and In all of the above instances, the
maternity leave can be credited as

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downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
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combinations of prenatal and postnatal terminated. (Section 5, Rule IV, IRR, RA

leave as long as it does not exceed one 11210)
hundred five (105)days or sixty (60) days,
as the case may be. In no case shall Maternity leave of a female worker with
postnatal care be less than sixty (60) pending administrative case
days. (Section 2, Rule IV, IRR, RA 11210)
The maternity leave benefits granted
Extended maternity leave under RA under Republic Act No. 11210 and this
11210, the Expanded Maternity Leave Rules shall be enjoyed by a female
Law worker in the public sector and in the
private sector even if she has a pending
In cases of live childbirth, an additional administrative case. (Section 6, Rule IV,
maternity leave of thirty (30) days, without IRR, RA 11210)
pay, can be availed of, at the option of the
female worker, provided that the employer Eligibility for the grant of maternity
shall be given due notice. Due notice to leave benefit in the private sector
the employer must be in writing and must
be given at least forty-five (45)days before To qualify for the grant of maternity
the end of the female worker's maternity leave benefit, the female worker must
leave. However, no prior notice shall be meet the following requirements:
necessary in the event of a medical
emergency but subsequent notice shall be a. She must have at least three (3)
given to the employer. The above period monthly contributions in the twelve-month
of extended maternity leave without pay period immediately preceding the
shall not be considered as gap in the semester of childbirth, miscarriage, or
service. (Section 3, Rule IV, IRR, RA emergency termination of pregnancy. In
11210) determining the female member's
entitlement to the benefit, the SSS shall
Frequency of the grant of maternity consider only those contributions paid
leave under RA 11210, the Expanded prior to the semester of contingency; and
Maternity Leave Law b. She shall have notified her employer
of her pregnancy and the probable date of
Maternity leave shall be granted to a her childbirth, which notice shall be
qualified female worker in every instance transmitted to the SSS in accordance with
of pregnancy, miscarriage or emergency the rules and regulations it may provide.
termination of pregnancy regardless of (Section 1, Rule VI, IRR, RA 11210)
frequency. (Section 4, Rule IV, IRR, RA
11210) Notice requirement for grant of
maternity leave benefit in the private
Grant of maternity leave benefits after sector
termination of employment under
The notification process for SSS-
Maternity leave with full pay shall be covered female workers and/or members
granted even if the childbirth, miscarriage, and employers shall be governed by the
or emergency termination of pregnancy following rules:
occurs not more than fifteen (15) calendar
days after the termination of an a. The female member, upon
employee's service, as her right thereto confirmation of pregnancy, shall
has already accrued. Such period is not immediately inform her employer of
applicable when the employment of the such fact and the expected date of
pregnant woman worker has been childbirth;
terminated without just cause, in which b. The employer shall, in turn, notify
case the employer will pay her the full the SSS through the prescribed
amount equivalent to her salary for one manner;
hundred five (105) days for childbirth and c. The above rules notwithstanding,
sixty (60) days for miscarriage or failure of the pregnant female worker
emergency termination of pregnancy to notify the employer shall not bar her
based on her full pay, in addition to the from receiving the maternity benefits,
other applicable daily cash maternity subject to guidelines to be prescribed
benefits that she should have received by the SSS; and
had her employment not been illegally d. Self-employed female members,
including those in the informal

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economy, OFWs and voluntary SSS The instances that the employer is
members may give notice directly to liable for damages to SSS
the SSS. (Section 2, Rule VI, IRR, RA
11210) The employer shall pay to the SSS
damages equivalent to the benefits which
Amount of maternity leave benefits in said female member would otherwise
the private sector have been entitled to in any of the
following instances: a. Failure of employer
Covered female workers availing of the to remit to the SSS the required
maternity leave benefits must receive their contributions for the female worker; or b.
full pay. Full payment of the maternity Failure of the employer to transmit to SSS
leave benefit shall be advanced by the the female worker's notification on the fact
employer within thirty (30) days from the of pregnancy and probable date of child
filing of the maternity leave application. In birth. (Section 8, Rule VI, IRR, RA 11210)
the case of self-employed female
members, including those in the informal Maternity leave benefits for women in
economy, OFWs and voluntary SSS the informal economy and voluntary
members, the SSS shall directly pay the contributors to the SSS
maternity benefit. (Section 3, Rule VI,
IRR, RA 11210) Maternity benefits shall cover all
married and unmarried women, including
Effect of payment of daily SSS female workers in the informal economy.
maternity benefits to sickness benefits Female workers in the informal economy
under SSS Law are entitled to maternity leave benefits if
they have remitted to the SSS at least
The payment of daily SSS maternity three (3) monthly contributions in the
benefits shall be a bar to recovery of twelve (12)-month period immediately
sickness benefits provided under Republic preceding the semester of her childbirth,
Act No. 11199, for the same period for miscarriage, or emergency termination of
which daily maternity benefits have been pregnancy. (Section 1, Rule VII, IRR, RA
received. (Section 6, Rule VI, IRR, RA 11210)
11210)
Allocation of maternity leave credits to
Consecutive pregnancies and multiple the child’s father or alternative
childbirths in the private sector caregiver

The payment of the SSS maternity Allocation to the child's father - A

benefits in cases of consecutive female worker entitled to maternity leave
pregnancies resulting in overlapping benefits may, at her option, allocate up to
maternity leaves and in cases of multiple seven (7) days of said benefits to the
childbirths shall be governed by the child's father, whether or not the same is
following rules: married to the female worker. The
allocated benefit granted to the child's
a. In case of the overlapping of two (2) father under this law is over and above
maternity benefit claims, the female that which is provided under Republic Act
member shall be granted maternity No. 8187, or the "Paternity Leave Act of
benefits for the two contingencies in a 1996". (Section 1, Rule VII, IRR, RA
consecutive manner. However, the 11210)
amount of benefit corresponding to the
period where there is an overlap shall be Alternate Caregiver - In case of death,
deducted from the current maternity absence, or incapacity of the child's
benefit claim; and father, the female worker may allocate to
an alternate caregiver who may be any of
b. The female member shall be paid the following, upon the election of the
only one maternity benefit, regardless of mother taking into account the best
the number of offspring, per interests of the child:
childbirth/delivery. (Section 7, Rule VI,
IRR, RA 11210) a. A relative within the fourth degree of
consanguinity; or
b. The current partner, regardless of
sexual orientation or gender identity, of
the female worker sharing the same

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household. The option to allocate entitled to enjoy the remaining unexpired

maternity leave credits shall not be leave credits of the female worker, if there
applicable in case the female worker be any, without pay: Provided, That such
suffers miscarriage or emergency leave without pay shall not be considered
termination of pregnancy. (Section 1, Rule as a gap in the service of the child's father
VIII, IRR, RA 11210) or alternate caregiver, in both the public
and private sector. (Section 4, Rule VIII,
Effects of availing the option to IRR, RA 11210)
allocate
Parental Leave for Solo Parents under
In case the female worker avails of the Republic Act No. 8972, as amended by
option to allocate, the SSS shall pay her RA11861
the amount of the maternity benefit
corresponding to the period not allocated. 2011 Bar Examinations

As applicable, the father or, in his Solo Parent refers to any individual who
death, absence, or incapacity, the falls under any of the following categories:
alternate caregiver shall be granted by his
employer a leave with pay equivalent to a 1. Birth as a consequence of rape, even
period from one (1) to seven (7) days, without final conviction: Provided, That the
which may be enjoyed either in a mother has the sole parental care and support of
continuous or in an intermittent manner the child or children;
not later than the period of the maternity
leave availed of. The female worker shall 2. Parent left solo or alone with the
notify her employer of her option to responsibility of parenthood due to the following
allocate with her application for maternity circumstances:
leave. The father or alternate caregiver, a. Death of spouse;
as the case may be, shall notify the b. Detention of the spouse for at least
employer concerned of his or her three (3) months or service of sentence
availment of the allocated leave and the for a criminal conviction;
inclusive dates therefor. This written c. Physical or mental incapacity of the
notice to the employers shall be required spouse as certified by a public or private
even if the child's father or the alternate medical practitioner;
caregiver is employed in the public sector. d. Legal separation or de facto
(Section 2, Rule VIII, IRR, RA 11210) separation from spouse for at least six (6)
Effect of death or permanent months and the solo parent is entrusted
incapacity of the beneficiary female with the sole parental care and support of
worker the child or children; or
e. Declaration of nullity or annulment of
In the event the beneficiary female marriage, as decreed by a court
worker dies or becomes permanently recognized by law or due to divorce,
incapacitated, the balance of her subject to existing laws, and the solo
maternity leave benefits, if any, shall parent is entrusted with the sole parental
accrue to the child's father or to a qualified care and support of the child or children;
alternate caregiver as provided in the or
preceding sections subject to the following f. Abandonment of spouse for at least
conditions: six (6) months;

a. That the maternity leave benefits 3. Spouse or any family member of an

have not yet been commuted to cash, if Overseas Filipino Worker (OFW), or the
applicable; and guardian of the child or children of an OFW:
b. That a certified true copy of the Provided, That the said PFW belongs to the low-
death certificate or medical certificate or semi0-skilled worker category and is away from
abstract is provided to the employers of the Philippines for an uninterrupted period of
both the female worker and the child's twelve (12) months; Proved, further, That the
father or alternate caregiver. OFW, his or her spouse, family member, or
guardian of the child or children of an OFW falls
In case the maternity leave benefits of under the requirements of this section.
the deceased or permanently
incapacitated female worker have already 4. Unmarried mother/father who keeps
been paid to the latter in full, the child's and rears the child or children.
father or alternate caregiver shall be

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5. Any legal guardian, adoptive or foster who shall prejudice the right of the person under
parent who solely provides parental care and this section shall be penalized in accordance
support to the child or children. with the provisions of the Labor Code and Civil
Service Rules and Regulations. Likewise, an
6. Any family member who assumes the employer who shall prejudice any person for
responsibility of head of family as a result of the assisting a co-employee who is a victim under
death, abandonment, disappearance or this Act shall likewise be liable for discrimination.
prolonged absence of the parents or solo parent. (Section 43, Republic Act No. 9262)

7. Any relative within the fourth (4th) civil 2. Ten-day paid leave in addition
degree of consanguinity or affinity of the parent to other leave benefits
or legal guardian who assumes parental care
and support of the child or children as a relist of At any time during the application of any
the death, abandonment, disappearance or protection order, investigation, prosecution
absence of the parents or solo parent for at least and/or trial of the criminal case, a victim of
six (6) months; Provided, That in cases of solo VAWC who is employed shall be entitled to a
grandparents who are senior citizens but who paid leave of up to ten (10) days in addition to
have the sole care and support over their other paid leaves under the Labor Code and
grandchildren who are unmarried, or Civil Service Rules and Regulations and other
unemployed and twenty-two (22) years old or existing laws and company policies, extendible
below, or those twenty-two (22) years old or when the necessity arises as specified in the
below but who are unable to fully take care or protection order.
protect themselves from abuse, neglect, cruelty, The Punong Barangay/kagawad or
exploitation or discrimination because of a prosecutor or the Clerk of Court, as the case
physical or mental disability or condition, they may be, shall issue a certification at no cost to
shall be entitled to the benefits of this Act in the woman that such an action is pending, and
addition to the benefits granted to them by this is all that is required for the employer to
Republic Act No. 9257, otherwise known as the comply with the 10-day paid leave.
“Expanded Senior Citizens Act of 2003”, or
For government employees, in addition to
8. A pregnant woman who provides sole the aforementioned certification, the employee
parental care and support to her unborn child or concerned must file an application for leave
children. (Section 4, RA 8972, as amended by citing as basis R.A. 9262.
RA 11861)
The administrative enforcement of this
Conditions for Entitlement of Parental Leave leave entitlement shall be considered within the
jurisdiction of the Regional Director of the DOLE
In addition to leave privileges under under Article 129 of the Labor Code of the
existing laws, a forfeitable and noncumulative Philippines, as amended, for employees in the
parental leave of not more than seven (7) private sector, and the Civil Service
working days with pay every year shall be Commission, for government employees.
granted to any solo parent, regardless of
employment status, who has rendered of at least The availment of the ten day-leave shall
six (6) months: Provided, That the parental leave be at the option of the woman employee, which
benefit may be availed of by the solo parent shall cover the days that she has to attend to
employees in the government and the private medical and legal concerns. Leaves not availed
sector. (Section 8, RA 8972, as amended by of are noncumulative and not convertible to
RA 11861) cash.

Leave for Victims of VAWC under Republic The employer/agency head who denies
Act 9262 the application for leave, and who shall prejudice
the victim-survivor or any person for assisting a
2011 Bar Examinations co-employee who is a victim-survivor under the
Act shall be held liable for discrimination and
1. Entitled to Leave violation of R.A 9262.

Victims under this Act shall be entitled to The provision of the Labor Code and the
take a paid leave of absence up to ten (10) days Civil Service Rules and Regulations shall govern
in addition to other paid leaves under the Labor the penalty to be imposed on the said
Code and Civil Service Rules and Regulations, employer/agency head. (Section 42, Rule VI,
extendible when the necessity arises as The Rules and Regulations Implementing the
specified in the protection order. Any employer

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Anti-Violence Against Women and Their 112-11, Series of 2011, as amended by

Children Act of 2004”) Department Order No. 112-A, Series of
2012, Implementing Rules and
Special leave benefit for women under Regulations of Republic Act 9710,
Republic Act 9710, the Magna Carta of otherwise known as the “Magna Carta of
Women Women”)

A woman employee having rendered Conditions to entitlement of special

continuous aggregate employment service of at leave under Republic Act 9710, the
least six (6) months for the last twelve (12) Magna Carta of Women
months shall be entitled to a special leave
benefit of two (2) months with full pay based on Any female employee, regardless of
her gross monthly compensation following age and civil status, shall be entitled to a
surgery caused by gynecological disorders. special leave, provided she has complied
(Section 18, Republic Act No. 9710) with the following conditions:

Definitions of the following terms under (a) She has rendered at least six (6)
Republic Act 9710, the Magna Carta of months continuous aggregate
Women employment service for the last twelve
(12) months prior to surgery;
1. “Special leave benefit for women” (b) She has filed an application for
2. “Gynecological disorders” special leave in accordance with Section
3. “At least six (6) months continuous 3 hereof
aggregate employment service for the (c) She has undergone surgery due to
last twelve (12) months prior to surgery” gynecological disorders as certified by a
competent physician. (Section 2,
1. “Special leave benefit for women” Department Order No. 112-11, Series of
means a female employee’s leave 2011, Implementing Rules and
entitlement of two (2) months with full pay Regulations of Republic Act 9710,
from her employer based on her gross otherwise known as the “Magna Carta of
monthly compensation following surgery Women”)
caused by gynecological disorders,
provided that she has rendered Distinction of special leave benefit
continuous aggregate employment under Republic Act 9710, the Magna
service of at least six (6) months for the Carta of Women, from SSS sickness
last 12 months. benefit.

2. “Gynecological disorders”, refers to The special leave benefit is different

disorders that would require surgical from the SSS sickness benefit. The
procedures such as, but not limited to, former is granted by the employer in
dilatation and curettage and those accordance with RA 9710, as
involving female reproductive organs such implemented under this Rules. It is
as the vagina, cervix, uterus, fallopian granted to a woman employee who has
tubes, ovaries, breast, adnexa and pelvic undergone surgery due to gynecological
floor, as certified by a competent disorder. The SSS sickness benefit, on
physician. For purposes of the Act and the the other hand, is administered and given
Rules and Regulations of this Act, by the SSS in accordance with the SSS
gynecological surgeries shall also include law or RA 1161 as amended by RA 8282.
hysterectomy, ovariectomy, and (Section 7, Department Order No. 112-11,
mastectomy. Series of 2011, as amended by
Department Order No. 112-A, Series of
3. “At least six (6) months continuous 2012, Implementing Rules and
aggregate employment service for the Regulations of Republic Act 9710,
last twelve (12) months prior to surgery” otherwise known as the “Magna Carta of
means that the woman employee should Women”)
have been with the company for twelve
(12) months, prior to surgery. An Effect of availing special leave benefit
aggregate service of at least six (6) under Republic Act 9710, the Magna
months within the said 12-month period Carta of Women on maternity leave
is sufficient to entitle her to avail of the benefit
special leave benefit (SLB) (Section
1[a],[b] and [e], Department Order No.

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Where the woman employee had regardless of their positions,

undergone surgery due to gynecological designations or employment status,
disorder during her maternity leave, she is and irrespective of the method by
entitled only to the difference between the which their wages are paid.
SL and maternity leave benefit. (Section
9, Department Order No. 112-11, Series b. Covered establishments refer to
of 2011, as amended by Department those that collect service charge for
Order No. 112-A, Series of 2012, work or service they offer. (Section 2,
Implementing Rules and Regulations of Department Order No. 242, Series of
Republic Act 9710, otherwise known as 2024, IRR of RA 11360)
the “Magna Carta of Women”)
Distribution of service charges under
Treatment of special leave benefit Article 96 of the Labor Code, as
under Republic Act 9710, the Magna amended by Republic Act 11360
Carta of Women?
All service charges actually collected
The special leave shall be non- by covered establishments shall be
cumulative and non-convertible to cash distributed completely and equally, based
unless otherwise provided by a collective on actual hours or days of work or service
bargaining agreement (CBA). (Section 12, rendered, among the covered employees,
Department Order No. 112-11, Series of including those already receiving the
2011, as amended by Department Order benefit of sharing in the service charges.
No. 112-A, Series of 2012, Implementing (Section 3, Department Order No. 242,
Rules and Regulations of Republic Act Series of 2024, IRR of RA 11360)
9710, otherwise known as the “Magna
Carta of Women”) Frequency of distribution of service
charges under Article 96 of the Labor
Service Charge Code, as amended by Republic Act
11360
2013 and 2011 Bar Examinations
The shares referred to herein shall be
Service charge under Article 96 of the distributed and paid to the covered
Labor Code as amended by Republic employees not less than once every two
Act No. 11360 (2) weeks or twice a month at intervals not
exceeding sixteen (16) days. (Section 4,
Service charge refers to the amount Department Order No. 242, Series of
that is added to the bill for work or service 2024)
rendered. (Section 2(e), Department
Order No. 242, Series of 2024, IRR of RA 13TH Month Pay
11360)
Those required to pay the 13th month pay
Those covered by service charge
under Article 96 of the Labor Code as All employers are required to pay their
amended by Republic Act No. 11360 rank-and-file employees the 13th month pay not
later than December 24 of every year. (Revised
These rules shall apply to all Guidelines on the Implementation of the 13 th
establishments collecting service charges Month Pay Law, dated November 16, 1987;
such as hotels, restaurants and other Section 1, Presidential Decree 851, as
similar establishments including those modified by Memorandum Order No. 28,
entities operating primarily as private dated August 13, 1986)
subsidiaries of the Government. (Section
1, Department Order No. 242, Series of Those entitled to receive the 13th month pay
2024, IRR of RA 11360)
All rank-and-file employees regardless
The covered employees and of the nature of their employment, and
establishments under Article 96 of the irrespective of the methods by which they are
Labor Code as amended by Republic paid, provided they worked for at least one
Act No. 11360 month during a calendar year. (No. 1 in relation
to No. 2, Revised Guidelines on the
a. Covered employees refer to all Implementation of the 13th Month Pay Law,
employees, except managerial dated November 16, 1987)
employees as defined herein,

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13th Month Pay for Certain Types of

Employees The employers who are exempted from
paying the 13th month
The following types of employees are
entitled to 13th month pay 2012 Bar Examinations

(a) Employees Paid by Results. — The following employers are exempted

Employees who are paid on piece work basis to pay 13th month under PD 851:
are by law entitled to the 13th month pay.
(a) Government and any of its political
Employees who are paid a fixed or subdivision, including government-owned and
guaranteed wage plus commission are also controlled corporations, except those
entitled to the mandated 13th month pay, based corporations operating essentially as private
on their total earnings during the calendar year, subsidiaries of the Government;
i.e., on both their fixed or guaranteed wage and (b) Employers already paying their
commission. employees 13th month pay or more in a calendar
year or its equivalent at the time of this
(b) Those with Multiple Employers. — issuance;
Government employees working part time in a (c) Persons in the personal service of
private enterprise, including private educational another in relation to such workers; and
institutions, as well as employees working in two (d) Employers who are paid on purely
or more private firms, whether on full or part time commission, boundary, or task basis, and those
basis, are entitled to the required 13th month who are paid a fixed amount for performing a
pay from all their private employers regardless specific work, irrespective of the time consumed
of their total earnings from each or all their in the performance thereof, except where the
employers. workers are paid on piece-rate basis in which
case the employer shall grant the required 13th
(c) Private School Teachers. — Private month pay to such workers.
school teachers, including faculty members of
universities and colleges, are entitled to the Note: The domestic worker is entitled to
required 13th month pay, regardless of the a 13th month pay as provided by law. (See Sec.
number of months they teach or are paid within 25, RA 10361)
a year, if they have rendered service for at least
one (1) month within a year. (No. 5, Revised As used herein, workers paid on piece-
Guidelines on the Implementation of the 13 th rate basis shall refer to those who are paid a
Month Pay Law, dated November 16, 1987) standard amount for every piece or unit of work
produced that is more or less regularly
(d) 13th Month Pay of Resigned or replicated, without regard to the time spent in
Separated Employee - An employee who has producing the same.
resigned or whose services were terminated at
any time before the time for payment of the 13th The term "its equivalent" as used on
month pay is entitled to this monetary benefit in paragraph (b) hereof shall include Christmas
proportion to the length of time he worked during bonus, mid-year bonus, cash bonuses and other
the year, reckoned from the time he started payments amounting to not less than 1/12 of the
working during the calendar year up to the time basic salary but shall not include cash and stock
of his resignation or termination from the dividends, cost of living allowances and all other
service. Thus, if he worked only from January up allowances regularly enjoyed by the employee,
to September his proportionate 13th month pay as well as non-monetary benefits. Where an
should be equivalent of 1/12 his total basic employer pays less than required 1/12th of the
salary he earned during that period. employees basic salary, the employer shall pay
the difference. (No. 2, Revised Guidelines on
The payment of the 13th month pay may the Implementation of the 13th Month Pay
be demanded by the employee upon the Law, dated November 16, 1987)
cessation of employer-employee relationship.
This is consistent with the principle of equity that The components of “basic salary” under the
as the employer can require the employee to 13th Month Pay Law
clear himself of all liabilities and property
accountability, so can the employee demand the “Basic salary” shall include all
payment of all benefits due him upon the remunerations or earnings paid by an employer
termination of the relationship. (No. 6, Revised to an employee for services rendered, but does
Guidelines on the Implementation of the 13 th not include allowances and monetary benefits
Month Pay Law, dated November 16, 1987) which are not considered, or integrated, as part

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downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
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of the regular, or basic, salary, such as the cash Relations Commission, G.R. Nos. 50999-
equivalent of unused vacation and sick leave 51000, 23 March 1990, 183 SCRA 610, ruled:
credits, overtime, premium, night differential and Broadly, the word "salary" means a recompense
holiday pay. Basic salary includes cost-of-living or consideration made to a person for his pains
allowances. However, these salary-related or industry in another man's business. Whether
benefits should be included as part of the basic it be derived from "salarium," or more fancifully
salary in the computation of the 13th month pay from "sal," the pay of the Roman soldier, it
if, by individual or collective agreement or carries with it the fundamental idea of
company practice or policy, the same are compensation for services rendered. Indeed,
treated as part of the basic salary of the there is eminent authority for holding that the
employees. (No. 4 [a], fourth paragraph, words "wages" and "salary" are in essence
Revised Guidelines on the Implementation of the synonymous. "Salary," the etymology of which is
13th Month Pay Law, dated November 16, 1987) the Latin word "salarium," is often used
interchangeably with "wage", the etymology of
Rule on the determination of whether a which is the Middle English word "wagen". Both
commission forms part of the basic salary words generally refer to one and the same
meaning, that is, a reward or recompense for
It is well-established in jurisprudence that services performed.
the determination of whether or not a
commission forms part of the basic salary Wage and salary in Article 1708 of the Civil
depends upon the circumstances or conditions Code distinguished
for its payment. In Phil Duplicators, Inc. v.
NLRC, G.R. No. 110068, November 11, 1993, In Gaa v. Court of Appeals, G.R. No. L-
227 SCRA 747, the Court held that commissions 44169 December 3, 1985 the Supreme Court
earned by salesmen form part of their basic interpreted that the distinction between salary
salary. The salesmen’s commissions, and wage was for the purpose of Article 1708 of
comprising a pre-determined percentage of the the Civil Code. Thus, the High Court ruled on the
selling price of the goods sold by each distinctions of wages and salary as follows:
salesman, were properly included in the term
basic salary for purposes of computing the 13th Article 1708 used the word "wages"
month pay. The salesmen’s commissions are and not "salary" in relation to "laborer"
not overtime payments, nor profit-sharing when it declared what are to be
payments nor any other fringe benefit, but a exempted from attachment and
portion of the salary structure which represents execution. The term "wages" as
an automatic increment to the monetary value distinguished from "salary", applies to
initially assigned to each unit of work rendered the compensation for manual labor,
by a salesman. On the other hand, in Boie- skilled or unskilled, paid at stated times,
Takeda Chemicals, Inc. v. De la Serna, G.R. and measured by the day, week, month,
Nos. 92174 and 102552, December 10, 1993, or season, while "salary" denotes a
228 SCRA 329, the so-called commissions paid higher degree of employment, or a
to or received by medical representatives were superior grade of services, and implies a
excluded from the term basic salary because position of office: by contrast, the term
these were paid to the medical representatives wages " indicates considerable pay for a
and rank-and-file employees as productivity lower and less responsible character of
bonuses, which were generally tied to the employment, while "salary" is suggestive
productivity, or capacity for revenue production, of a larger and more important service
of a corporation and such bonuses closely (35 Am. Jur. 496).
resemble profit-sharing payments and had no
clear direct or necessary relation to the amount The distinction between wages and
of work actually done by each individual salary was adverted to in Bell vs.
employee. (Philippine Spring Water Resources, Indian Livestock Co. (Tex. Sup.), 11
Inc. v. Court of Appeals, G.R. No. 205278, June S.W. 344, wherein it was said: "'Wages'
11, 2014) are the compensation given to a hired
person for service, and the same is true
Wage and salary are synonymous of 'salary'. The words seem to be
synonymous, convertible terms, though
2017 and 1994 Bar Examinations we believe that use and general
acceptation have given to the word
That wage and salary are synonymous 'salary' a significance somewhat
has been settled. The Supreme Court in different from the word 'wages' in this:
Cumigad v. AAA, G.R. No. 219715, December that the former is understood to relate to
06, 202i citing Songco v. National Labor position of office, to be the

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compensation given for official or other The Court, at this point, makes a
service, as distinguished from 'wages', distinction between "facilities" and
the compensation for labor." Annotation "supplements". It is of the view that the
102 Am. St. Rep. 81, 95. food and lodging, or the electricity and
water allegedly consumed by private
Rules on facilities respondents in this case were not
facilities but supplements. In the case of
The following are the relevant rules on Atok-Big Wedge Assn. v. Atok-Big
facilities: Wedge Co., the two terms were
distinguished from one another in this
1. Subsidized meals and snacks – An wise:
employer may provide subsidized meals and
snacks to his employees provided that the "Supplements", therefore,
subsidy shall not be less than 30% of the fair constitute extra remuneration or
and reasonable value of such facilities. In such special privileges or benefits
case, the employer may deduct from the wages given to or received by the
of the employees not more than 70% of the laborers over and above their
value of the meals and snacks enjoyed by the ordinary earnings or wages.
employees, provided that such deduction is with "Facilities", on the other hand,
the written authorization of the employees are items of expense necessary
concerned. (Section 4, Rule VII-A, Book III, for the laborer's and his family's
Rules to Implement the Labor Code) existence and subsistence so
that by express provision of law
2. Facilities - The term “facilities” as used (Sec. 2[g]), they form part of the
in this Rule shall include articles or services for wage and when furnished by the
the benefit of the employee or his family but employer are deductible
shall not include tools of the trade or articles or therefrom, since if they are not
service primarily for the benefits of the employer so furnished, the laborer would
or necessary to the conduct of the employer’s spend and pay for them just the
business. (Section 5, Rule VII-A, Book III, same.
Rules to Implement the Labor Code)
In short, the benefit or privilege
3. Value of Facilities - The fair and given to the employee which constitutes
reasonable value of facilities is hereby an extra remuneration above and over
determined to be the cost of operation and his basic or ordinary earning or wage is
maintenance, including adequate depreciation supplement; and when said benefit or
plus reasonable allowance (but not more than 5 privilege is part of the laborers' basic
½% interest on the depreciated amount of wages, it is a facility. The distinction
capital invested by the employer); provided that lies not so much in the kind of benefit
if the total so computed is more than the fair or item (food, lodging, bonus or sick
rental value (or fair price of the commodities or leave) given, but in the purpose for
facilities offered for sale) the fair rental value (or which it is given. In the case at bench,
the fair price of the commodities or facilities the items provided were given freely by
offered for sale) shall be the reasonable cost of SLL for the purpose of maintaining
the operation and maintenance. The rate of the efficiency and health of its
depreciation and depreciated amount computed workers while they were working at
by the employer shall be those arrived at under their respective projects. (Id. at 422-
good accounting practices. (second paragraph, 423; citations omitted; italics
Section 6, Rule VII-A, Book III, Rules to supplied; emphasis and
Implement the Labor Code) underscoring ours)

Distinction between "facilities" and

"supplements"

In Our Haus Realty Development Legal requirements to deduct facilities

Corporation v. Parian, G.R. No. 204651,
August 6, 2014, the Supreme Court was 2018, 2013 and 2010 Bar Examinations
confronted with the issue on the proper As held in Mabeza v. National Labor
characterization of the free board and lodging Relations Commission, G.R. No. 118506,
provided by the employer. Thus, the High Court April 18, 1997: Granting that meals and lodging
explained: were provided and indeed constituted facilities,
such facilities could not be deducted without the

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employer complying first with certain legal to the employer’s greater convenience
requirements. Without satisfying these or advantage.
requirements, the employer simply cannot
deduct the value from the employee's wages. Under the purpose test, substantial
First, proof must be shown that such facilities consideration must be given to the
are customarily furnished by the trade. Second, nature of the employer’s business in
the provision of deductible facilities must be relation to the character or type of work
voluntarily accepted in writing by the employee. performed by the employees involved.
Finally, facilities must be charged at fair and
reasonable value. (Labor Code, art. 97 [f]) When bonuses be considered part of the
wage, salary or compensation
The purpose test set by jurisprudence
In Eastern Telecommunications
In explaining the purpose test, the Philippines, Inc. v. Eastern
Supreme Court in Our Haus Realty Telecommunications, Employees Union, G.
Development Corporation v. Parian, G.R. No. R. No. 185665, February 8, 2012, the
204651, August 6, 2014 said: consequential question that needs to be settled,
therefore, is whether the subject bonuses are
Under this test, if a benefit or demandable or not. Stated differently, can these
privilege granted to the employee is bonuses be considered part of the wage, salary
clearly for the employer’s convenience, or compensation making them enforceable
it will not be considered as a facility but obligations? In resolving the issue, the Supreme
a supplement. (Mabeza v. National Court explained:
Labor Relations Commission, G.R.
No. 118506. April 18, 1997) Here, From a legal point of view, a bonus
careful consideration is given to the is a gratuity or act of liberality of the
nature of the employer’s business in giver which the recipient has no right to
relation to the work performed by the demand as a matter of right. (Philippine
employee. This test is used to address National Construction Corp. v.
inequitable situations wherein National Labor Relations
employers consider a benefit deductible Commission, 345 Phil. 324, 331
from the wages even if the factual [1997]) The grant of a bonus is basically
circumstances show that it clearly a management prerogative which
redounds to the employers’ greater cannot be forced upon the employer
advantage. who may not be obliged to assume the
onerous burden of granting bonuses or
While the rules serve as the initial other benefits aside from the
test in characterizing a benefit as a employee’s basic salaries or wages.
facility, the purpose test additionally (Trader’s Royal Bank v. National
recognizes that the employer and the Labor Relations Commission, G.R.
employee do not stand at the same No. 88168, August 30, 1990, 189
bargaining positions on benefits that SCRA 274, 277)
must or must not form part of an
employee’s wage. In the ultimate A bonus, however, becomes a
analysis, the purpose test seeks to demandable or enforceable obligation
prevent a circumvention of the minimum when it is made part of the wage or
wage law. salary or compensation of the
employee. (Philippine National
xxx Construction Corp. v. National Labor
Relations Commission, 366 Phil. 678
Ultimately, the real difference lies (1999); Philippine Duplicators, Inc. v.
not on the kind of the benefit but on the National Labor Relations
purpose why it was given by the Commission, 311 Phil. 407, 419
employer. If it is primarily for the [1995]) Particularly instructive is the
employee’s gain, then the benefit is a ruling of the Court in Metro Transit
facility; if its provision is mainly for the Organization, Inc. v. National Labor
employer’s advantage, then it is a Relations Commission, 315 Phil. 860,
supplement. Again, this is to ensure that 871 (1995) where it was written:
employees are protected in
circumstances where the employer Whether or not a bonus
designates a benefit as deductible from forms part of wages depends
the wages even though it clearly works upon the circumstances and

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Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
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conditions for its payment. If it is forms of encouragement to inspire

additional compensation which employees to put a little more industry
the employer promised and on the jobs particularly assigned to
agreed to give without any them, still these commissions are direct
conditions imposed for its remunerations for services rendered. In
payment, such as success of fact, commissions have been defined as
business or greater production the recompense, compensation or
or output, then it is part of the reward of an agent, salesman, executor,
wage. But if it is paid only if trustee, receiver, factor, broker or
profits are realized or if a certain bailee, when the same is calculated as a
level of productivity is achieved, percentage on the amount of his
it cannot be considered part of transactions or on the profit to the
the wage. Where it is not principal. The nature of the work of a
payable to all but only to some salesman and the reason for such type
employees and only when their of remuneration for services rendered
labor becomes more efficient or demonstrate clearly that commissions
more productive, it is only an are part of a salesman’s wage or salary.
inducement for efficiency, a (Philippine Duplicator’s, Inc. vs.
prize therefore, not a part of the NLRC, 227 SCRA 747 [1993])
wage.
Thus, the commissions earned by
Commissions as part of actual wages private respondents in selling softdrinks
constitute part of the compensation or
2012, 1997 and 1992 Bar Examinations remuneration paid to drivers/salesmen
and truck helpers for serving as such,
In Iran v. NLRC, G.R. No. 121927. April and hence, must be considered part of
22, 1998 in explaining that a commission should the wages paid them.
be included in the computation of actual wages,
the High Court ruled: The NLRC asserts that the inclusion
of commissions in the computation of
Article 97(f) of the Labor Code defines wages would negate the practice of
wage as follows: granting commissions only after an
employee has earned the minimum
Art. 97(f) — “Wage” paid to wage or over. While such a practice
any employee shall mean the does exist, the universality and
remuneration or earnings, prevalence of such a practice is
however designated, capable of questionable at best. In truth, this Court
being expressed in terms of has taken judicial notice of the fact that
money, whether fixed or some salesmen do not receive any
ascertained on a time, task, basic salary but depend entirely on
piece, or commission basis, or commissions and allowances or
other method of calculating the commissions alone, although an
same, which is payable by an employer-employee relationship exists.
employer to an employee under (Songco vs. NLRC, 183 SCRA 610
a written or unwritten contract of [1990]) Undoubtedly, this salary
employment for work done or to structure is intended for the benefit of
be done, or for services the corporation establishing such, on the
rendered or to be rendered and apparent assumption that thereby its
includes the fair and reasonable salesmen would be moved to greater
value, as determined by the enterprise and diligence and close more
Secretary of Labor, of board, sales in the expectation of increasing
lodging, or other facilities their sales commissions. This, however,
customarily furnished by the does not detract from the character of
employer to the employee. such commissions as part of the salary
or wage paid to each of its salesmen for
xxx xxx rendering services to the corporation.
x x x.” (supra, Philippine Duplicators)
(Emphasis supplied)
Likewise, there is no law mandating
This definition explicitly includes that commissions be paid only after the
commissions as part of wages. While minimum wage has been paid to the
commissions are, indeed, incentives or employee. Verily, the establishment of a

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minimum wage only sets a floor below Commission, G.R. No. 152928, June 18, 2009,
which an employee’s remuneration 589 SCRA 376, 384)
cannot fall, not that commissions are
excluded from wages in determining Meaning of the term “benefits” mentioned in
compliance with the minimum wage law. the non-diminution rule
This conclusion is bolstered by
Philippine Agricultural Commercial In Royal Plant Workers Union v. Coca-
and Industrial Workers Union vs. Cola Bottlers Philippines, Inc.-Cebu Plant, G.
NLRC, 247 SCRA 256 (1995) where R. No. 198783, April 15, 2013, it was ruled:
this Court acknowledged that drivers
and conductors who are compensated The operators’ chairs cannot be
purely on a commission basis are considered as one of the employee
automatically entitled to the basic benefits covered in Article 100 of the
minimum pay mandated by law should Labor Code. In the Court’s view, the
said commissions be less than their term “benefits” mentioned in the non-
basic minimum for eight hours work. It diminution rule refers to monetary
can, thus, be inferred that were said benefits or privileges given to the
commissions equal to or even exceed employee with monetary equivalents.
the minimum wage, the employer need Such benefits or privileges form part of
not pay, in addition, the basic minimum the employees’ wage, salary or
pay prescribed by law. It follows then compensation making them enforceable
that commissions are included in obligations.
determining compliance with minimum
wage requirements. This Court has already decided
several cases regarding the non-
Non-elimination or diminution rule diminution rule where the benefits or
privileges involved in those cases
Requisites of diminution of benefits mainly concern monetary considerations
or privileges with monetary equivalents.
There is diminution of benefits when the Some of these cases are: Eastern
following requisites are present: (1) the grant or Telecommunication Phils. Inc. v.
benefit is founded on a policy or has ripened into Eastern Telecoms Employees Union,
a practice over a long period of time; (2) the (G.R. No. 185665, February 8, 2012,
practice is consistent and deliberate; (3) the 665 SCRA 516) where the case
practice is not due to error in the construction or involves the payment of 14th, 15th and
application of a doubtful or difficult question of 16th month bonuses; Central Azucarera
law; and (4) the diminution or discontinuance is De Tarlac v. Central Azucarera De
done unilaterally by the employer.” (Colegio Tarlac Labor Union-NLU, (G.R. No.
San Agustin-Bacolod v. Montaño, G.R. No. 188949, July 26, 2010, 625 SCRA 622)
212333, March 28, 2022) regarding the 13th month pay,
legal/special holiday pay, night premium
When is a benefit to be considered as a pay and vacation and sick leaves;
regular company practice TSPIC Corp. v. TSPIC Employees
Union, (G.R. 163419, February 13,
2019, 2015, 2014, 2013, and 2005 Bar 2008, 545 SCRA 215) regarding salary
Examinations wage increases; and American Wire and
Cable Daily Employees Union vs.
As held in Vergara, Jr. v. Coca-Cola American Wire and Cable Company,
Bottlers Philippines, Inc., G.R. No. 176985, Inc., (497 Phil. 213 [2005]) involving
April 1, 2013, “To be considered as a regular service awards with cash incentives,
company practice, the employee must prove by premium pay, Christmas party with
substantial evidence that the giving of the incidental benefits and promotional
benefit is done over a long period of time, and increase.
that it has been made consistently and
deliberately.” (See Eastern The instance when non-diminution rule
Telecommunications Philippines, Inc., v. finds no application
Eastern Telecoms Employees Union, supra
note 15, at 532; Supreme Steel Corporation v. Also, even assuming arguendo that the
Nagkakaisang Manggagawa ng Supreme Saturday work involved in this case falls within
Independent Union (NMS-IND-APL), supra, at the definition of a "benefit" protected by law, the
528; and Metropolitan Bank and Trust fact that it was made subject to a condition (i.e.,
Company v. National Labor Relations the existence of operational necessity) negates

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the application of Article 100 pursuant to the on his behalf by his natural guardian or next-of-
established doctrine that when the grant of a kin. The affidavit shall be presented to the
benefit is made subject to a condition and such employer who shall make payment through the
condition prevails, the rule on non-diminution Secretary of Labor and Employment or his
finds no application. Otherwise stated, if representative. The representative of the
Saturday work and its corresponding premium Secretary of Labor and Employment shall act as
pay were granted to CCBPI's employees without referee in dividing the amount paid among the
qualification, then the company's policy of heirs. The payment of wages under this Article
permitting its employees to suffer work on shall absolve the employer of any further liability
Saturdays could have perhaps ripened into with respect to the amount paid. (Article 105,
company practice protected by the non- Labor Code)
diminution rule. (Coca-Cola Bottlers
Philippines, Inc. v. Iloilo Coca-Cola Plant Regulations on exceptions to direct payment
Employees Labor Union (ICCPELU), G.R. No. of wages
195297, December 05, 2018)
2013 and 1998 Bar Examinations
Overtime is not within the term
benefits under Article 100 on Non- Payment of wages shall be made direct to
elimination or Diminution Rule the employees entitled thereto except in the
following cases:
2015, and 2013 Bar Examinations
(a) Where the employer is authorized in
The requirement of rendering additional writing by the employee to pay his wages to a
service differentiates overtime pay from member of his family;
benefits such as thirteenth month pay or yearly (b) Where payment to another person of
merit increase. These benefits do not require any part of the employee’s wages is authorized
any additional service from their beneficiaries. by existing law, including payments for the
Thus, overtime pay does not fall within the insurance premiums of the employee and union
definition of benefits under Article 100 of the dues where the right to check-off has been
Labor Code. (San Miguel Corporation v. recognized by the employer in accordance with
Layoc, Jr., G.R. No. 149640, October 19, 2007 a collective agreement or authorized in writing
CITING See Manila Jockey Club Employees by the individual employees concerned; or
Labor Union – PTGWO v. Manila Jockey (c) In case of death of the employee.
Club, Inc., G.R. No. 167760, 7 March 2007, (Section 5, Rule VIII, Book III, Rules to
517 SCRA 707) Implement the Labor Code)

Direct payment of wages Wages paid by an employer

Wages shall be paid directly to the No employer shall pay the wages of an
workers to whom they are due. (Article 104, employee by means of promissory notes,
Labor Code) vouchers, coupons, tokens, tickets, chits, or any
object other than legal tender, even when
Exceptions to direct payment of wages expressly requested by the employee. (Art. 102,
Labor Code) Under the Civil Code (see Article
(a) In cases of force majeure rendering 1705), the laborer’s wages shall be paid in legal
such payment impossible or under other special currency.
circumstances to be determined by the
Secretary of Labor and Employment in On the validity of outsourcing of specific
appropriate regulations, in which case, the jobs, works or services.
worker may be paid through another person
under written authority given by the worker for Clearly, the law and its implementing rules
the purpose; or allow contracting arrangements for the
performance of specific jobs, works or services.
(b) Where the worker has died, in which Indeed, it is management prerogative to farm out
case, the employer may pay the wages of the any of its activities, regardless of whether such
deceased worker to the heirs of the latter without activity is peripheral or core in nature. However,
the necessity of intestate proceedings. The in order for such outsourcing to be valid, it must
claimants, if they are all of age, shall execute an be made to an independent contractor because
affidavit attesting to their relationship to the the current labor rules expressly prohibit labor-
deceased and the fact that they are his heirs, to only contracting. (Aliviado v. Procter & Gamble
the exclusion of all other persons. If any of the Phils., Inc., G.R. No. 160506, March 9, 2010)
heirs is a minor, the affidavit shall be executed

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Concept of independent contractor c) In performing the work farmed

out, the contractor or subcontractor is
An independent contractor is defined as: free from the control and/or direction of
[O]ne who carries on a distinct and independent the principal in all matters connected
with the performance of the work
business and undertakes to perform the job, except as to the result thereto; and
work, or service on its own account and under
one's own responsibility according to d) The Service Agreement ensures
one's own manner and method, free from the compliance with all the rights and
control and direction of the principal in all benefits for all the employees of the
matters connected with the performance of the contractor or subcontractor under the
work except as to the results thereof. (Ditiangkin labor laws.
v. Lazada E-Services Philippines, Inc., G.R. No.
246892, September 21, 2022) Permissible contracting or subcontracting
is governed by a trilateral relationship wherein
Different kinds of independent contractors the principal engages the contractor's services.
In tum, the contractor hires workers to
Ditiangkin v. Lazada E-Services accomplish the work for the principal. (Fuji
Philippines, Inc. G.R. No. 246892, September Television Network, Inc. v. Espiritu, 749 Phil.
21, 2022: Our laws and jurisprudence recognize 388 (2014) [Per J. Leonen, Second Division].)
two types of contractors:
legitimate job contractors and independent The second type of independent
contractors who possess unique skills and contractor consists of individuals who possess
talent. (Id.) unique skills and talents which set them apart
from ordinary employees and whose means and
Article 106 of the Labor Code governs methods of work are free from the control of the
legitimate job contractors and subcontractors. employer. (Id.) Examples can include a
columnist who was hired because of her talent,
To be considered a legitimate contractor, skill, experience, and feminist standpoint,
the contractor must have a substantial capital or (Orozco v. Court ofAppeals, 584 Phil. 35-57
investment. It must also have a distinct and (2008) [Per J. Nachura, Third Division].) a
independent business uncontrolled by the basketball referee who has special skills and
principal and compliant with all the rights and independent judgment, (Bernarle v. Philippine
benefits for the employees. (Mago v. Sun Power Basketball Association, 673 Phil. 384 (2011)
Manufacturing Limited, 824 Phil. 464(2018) [Per [Per J. Carpio, Second Division].) and
J. Reyes, Jr., Second Division].) Section a masiador or sentenciador who had expertise in
8 ofDOLE Department Order No. 174-2017 lays cockfight
down the conditions for permissible contracting gambling. (Semblante v. Court ofAppeals, 671 P
or subcontracting. hil. 213 (2011) [Per J. Velasco, Jr., Third
Division].)
Section 8 of DOLE Department Order No.
174-2017 lays down the conditions for In these instances, there is no trilateral
permissible contracting or subcontracting: relationship but a bilateral relationship because
the independent contractors are directly
SECTION 8. Permissible Contracting or engaged by the principal. (Fuji Television
Subcontracting Arrangements. - Notwithstanding Network, Inc. v Espiritu, 749 Phil. 388 (2014)
Sections 5 and 6 hereof, contracting or subcontracting [Per J. Leonen, Second Division].)
sha[l only be allowed if all the following circumstances
concur: With this type of contracting, there is no
employer-employee relationship between an
a) The contractor or subcontractor independent contractor and the principal, and
is engaged in a distinct and
independent business and undertakes
their contracts are governed by the Civil Code.
to perform the job or work on When the status of the employment is in dispute,
its own responsibility, according to its the employer bears the burden to prove that the
own manner and method; workers are independent contractors rather than
regular employees. (Id.)
b) The contractor or subcontractor
has substantial capital to carry out the Independent contractors recognized by
job farmed out by the principal on his
account, manner and method,
jurisprudence
investment in the form of tools,
equipment, machinery and supervision; The following were recognized as
independent contractors because of their
unique skills and talents and the lack of

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control over the means and methods in the

performance of their work: Employees under fixed-term contracts are
not independent contractors
1. In Orozco v. Court of Appeals,
584 Phil. 35 (2008) [Per J. Nashira, Fuji’s argument that Arlene was an
Third Division]Wilhelmina Orozco independent contractor under a fixed-term
was a columnist for the Philippine contract is contradictory. Employees under
Daily Inquirer. This court ruled that fixed-term contracts cannot be independent
she was an independent contractor contractors because in fixed-term contracts, an
because of her “talent, skill, employer-employee relationship exists. The test
experience, and her unique in this kind of contract is not the necessity and
viewpoint as a feminist advocate.” desirability of the employee’s activities, “but the
(Id. at 56) In addition, the Philippine day certain agreed upon by the parties for the
Daily Inquirer did not have the power commencement and termination of the
of control over Orozco, and she employment relationship.” (Id. at 709) For
worked at her own pleasure. regular employees, the necessity and desirability
of their work in the usual course of the
2. Semblance v. Court of employer’s business are the determining factors.
Appeals, G.R. No. 196426, August On the other hand, independent contractors do
15, 2011, 655 SCRA 444 [Per J. not have employer-employee relationships with
Velasco, Jr., Third Division] involved their principals. (Fuji Television Network, Inc. v.
a masiador (Id. at 446. Semblance v. Espiritu, G.R. No. 204944-45, December 03,
Court of Appeals defined “masiador” 2014)
as the person who “calls and takes
the bets from the gamecock owners The arrangements which are excluded from
and other bettors and orders the the coverage of D.O. 174, Series of 2017,
start of the cockfight. He also implementing Articles 106 to 109 of the
distributes the winnings after Labor Code
deducting the Arriba, or the
commission for the cockpit.”) and D.O. 174, Series of 2017 implementing
a sentenciador. (Id. A “sentenciador” Articles 106 to 109 of the Labor Code applies
is defined as the person who only to trilateral relationship which characterizes
“oversees the proper gaffing of contracting or subcontracting arrangement. As
fighting cocks, determines the clarified by Department Circular No. 01, Series
fighting cocks’ physical condition of 2018, the following are excluded:
and capabilities to continue the
cockfight, and eventually declares 1. It does not contemplate to cover
the result of the cockfight.”) This information technology-enabled services
court ruled that “petitioners involving an entire or specific business process
performed their functions such as:
as masiador and sentenciador free
from the direction and control of • Business Process Outsourcing
respondents” (Id. at 452) and that • Knowledge Process Outsourcing
the masiador and sentenciador “relie • Legal Process Outsourcing
d mainly on their ‘expertise that is • IT Infrastructure Outsourcing
characteristic of the cockfight
• Application Development
gambling.’” (Id.) Hence, no
employer-employee relationship • Hardware and/or Software Support
existed. • Medical Transcription
• Animation Services
3. Bernarte v. Philippine • Back Office Operations/Support
Basketball Association, G.R. No.
192084, September 14, 2011, 657 2. Contacting or subcontracting
SCRA 745 [Per J. Carpio, Second arrangements in the Construction Industry under
Division] involved a basketball the licensing coverage of the Philippine
referee. This court ruled that “a Construction Accreditation Board (PCAB), shall
referee is an independent contractor, be governed by Department Order No. 19,
whose special skills and Series of 1993 (Guidelines Governing the
independent judgment are required Employment of Workers in the Construction
specifically for such position and Industry); Department Order No. 13, Series of
cannot possibly be controlled by the 1998 (Guidelines Governing the Occupational
hiring party.”(Id. at 757) Safety and Health in the Construction Industry;

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and DOLE-DPWH-DILG-DTI and PCAB performance of the work except as

Memorandum of Agreement-Joint Administrative to the result thereto; and
Order No. 1, Series of 2011 on coordination and
harmonization of policies and programs on d) The Service Agreement ensures
occupational safety and health in the compliance with all the rights and
construction industry. benefits for all the employees of the
contractor or subcontractor under
3. Except for the registration requirements the labor laws. (Section 8, D.O. No.
as provided for in D.O. No 174, Series of 2017, 174, Series of 2017)
contracting or subcontracting arrangements in
the private security industry shall be governed The required “substantial capital”
by Department Order No. 150, Series of 2016
(Revised Guidelines Governing the Employment ““Substantial capital” - refers to paid-up
and Working Conditions of Security Guards and capital stock/shares at least Five Million
other Private Security Personnel in the Private Pesos (P5,000,000.00) in the case of
Security Industry). corporations, partnerships and
cooperatives; in the case of single
4. D.O. No 174, Series of 2017 also proprietorship, a net worth of at least Five
does not contemplate to cover contractual Million Pesos (P5,000,000.00). (Section 3
relationships such as in contract of sale or (l), D.O. No. 174, Series of 2017)
purchase, contract of lease, contract of
management, operation and maintenance Articles 106-109 of the Labor Code
and such other contracts governed by the
Civil Code of the Philippines and other 2014, 2013, 2012, 2011, 2009, 2004,
special laws. 2002, 2001, 200, 1997 and 1994 Bar
Examinations
5. D.O. No 174, Series of 2017 does
not also cover the contracting out of job or The conditions for legitimate job contracting
work to a professional, or individual with or subcontracting
unique skills and talents who himself or
herself performs the job or work for the In Manila Cordage Company-
principal. Employees Labor Union v. Manila Cordage
Company, G. R. No. 242495-96, September
Criteria for legitimate contracting or 16, 2020, the conditions for legitimate job
subcontracting contracting or subcontracting laid down by the
Supreme Court are as follows:
Contracting or subcontracting shall only
be allowed if all the following circumstances Obviously, the permitted or permissible or
concur: legitimate job contracting or subcontracting is
the one allowed and permitted by law. It is an
a) The contractor or subcontractor is arrangement whereby a principal agrees to put
engaged in a distinct and out or farm out with the contractor or
independent business and subcontractor the performance or completion of
undertakes to perform the job or a specific job, work, or service within a definite
work on its own responsibility, or predetermined period, regardless of whether
according to its own manner and such job, work, or service is to be performed or
method; completed within or outside the premises of the
principal. To determine its existence, these
b) The contractor or subcontractor has conditions must concur: (a) the contractor
substantial capital to carry out the carries on a distinct and independent business
job farmed out by the principal on and partakes the contract work on his account
his account, manner and method, under his own responsibility according to his
investment in the form of tools, own manner and method, free from the control
equipment, machinery and and direction of his employer or principal in all
supervision; matters connected with the performance of his
work except as to the results thereof; (b) the
c) In performing the work farmed out, contractor has substantial capital or investment;
the contractor or subcontractor is and (c) the agreement between the principal and
free from the control and/or the contractor or subcontractor assures the
direction of the principal in all contractual employees' entitlement to all labor
matters connected with the and occupational safety and health standards,

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free exercise of the right to self-organization, First, it bears stressing that in the
security of tenure, and social welfare benefits. context of labor-only contracting,
substantial capital or investment rests not
only on the capitalization indicated in the
Prohibitions on Labor-only Contracting financial documents but on the pieces of
equipment and machinery, and work
Labor-only contracting, which is totally premises a person or entity actually and
prohibited, refers to an arrangement where: directly used in the performance of the
work or service it contracts out. In other
a) i. The contractor or subcontractor does words, to be considered as a legitimate
not have substantial capital or labor contractor, a person or entity must
ii. The contractor or subcontractor does possess the necessary tools and
not have investments in the form of tools, premises in relation to the job or service it
equipment, machineries, supervision, work renders. (Id. at 379.) Definitely, job
premises, among others, contracting per se is not prohibited. It is
iii. The contractor’s or subcontractor’s permissible where the contractor
employees recruited and placed are performing establishes that it has substantial capital
activities which are directly related to the main or investment in relation to the service or
business operation of the principal; or job that it provides and it undertakes an
b) The contractor or subcontractor does independent business, which is free from
not exercise the right to control over the the control of the principal. (Consolidated
performance of the work of the employee. Building Maintenance, Inc. v.
(Section 5, D.O. No. 174, Series of 2017) Asprec, supra note 32 at 644)

In Servflex, Inc. v. Uera, G.R. No. 246369, Previously, in Luces v. Coca-Cola

March 29, 2022, the Supreme Court explained Bottlers Philippines, Inc., G.R. No. 213816,
the concept of labor-only contracting: December 2, 2020, the High Court said: Labor-
only contracting refers to the arrangement where
Labor-only contracting refers to an the contractor or subcontractor merely recruits,
arrangement whereby a person who supplies or places workers to perform a job or
does not have substantial capital or work for a principal. Under Sec. 5 of the (DOLE)
investment deploys workers to the Department Order (DO) No. 174, series of
employer for them to perform tasks that 2017,69 there is labor-only contracting when: (a)
are directly necessary to the employer's the contractor or subcontractor does not have
principal business. (See Consolidated substantial capital or does not have investment
Building Maintenance, Inc. v. Asprec, 832 in tools, equipment, machineries, supervision
Phil. 630, 642 [2018]) It is present where: and work premises and the employees are
(1) a person who supplies workers to an performing activities which are directly related to
employer does not possess substantial the main business of the principal; or (b) the
capital or investment in the form of tools, contractor or subcontractor does not exercise
pieces of equipment or machinery, work the right of control over the work of the
premises, among others; and (2) the employees except as to the result thereto.
workers are made to perform tasks which
are directly related to the employer's Accordingly, there are two instances when
principal business. Under the a contractor or subcontractor is deemed to be
circumstances, the intermediary or the engaged in labor-only contracting. In the first
person who assigned the workers to the instance, there are two indicators: (1) the
employer shall be deemed as the latter's contractor or subcontractor does not have
agent, and the employer shall be substantial capitalization or it does not have
responsible for the workers, as if it directly investment in tools, equipment, machineries,
hired them. (W.M. Manufacturing, Inc. v. supervision and work premises and (2) its
Dalag, 774 Phil. 353, 375-376 (2015), employees are performing activities or jobs
citing Article 106 of the Labor Code of the which are directly related and indispensable to
Philippines.) the main business of the principal. In the second
instance, the principal, not the contractor or
Overall, the presence of a labor-only subcontractor, exercises the power of control
contracting is evident in such a situation over the manner and method of the employees'
where the contractor merely recruits, work.
supplies, and assigns workers to perform
a job for a principal, as in the present xxx xxx xxx
case.

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However, having substantial capitalization e) Contracting out of a job or work

does not easily convince this Court that being performed by union members
Interserve and Hotwired are legitimate job and such will interfere with, restrain
contractors. Jurisprudence has established that or coerce employees in the
this Court does not set an absolute figure for exercise of their rights to self-
what it considers substantial capital for an organization as provided in Art. 259
independent job contractor, but it measures the of the Labor Code, as amended.
same against the type of work which the f) Requiring the
contractor is obligated to perform for the contractor’s/subcontractor’s
principal. employees to perform functions
which are currently being
The burden to prove substantial performed by the regular
capital, investment, etc. employees of the principal.
g) Requiring the
The law casts the burden on the contractor’s/subcontractor’s
contractor to prove that it has substantial capital, employees to sign, as a
investment, tools, etc. Employees, on the other precondition to employment or
hand, need not prove that the contractor does continued employment, an
not have substantial capital, investment, and antedated resignation letter; a blank
tools to engage in job-contracting.” (Babas v. payroll; a waiver of labor standards
Lorenzo Shipping Corporation, G.R. No. including minimum wages and
186091, December 15, 2010) social or welfare benefits; or a
quitclaim releasing the principal or
Effect of failing to discharge the contractor from liability as to
burden of proof on substantial capital payment of future claims; or require
the employee to become member
"Generally, the presumption is that the of a cooperative.
contractor is a labor-only [contractor] unless h) Repeated hiring by the
such contractor overcomes the burden of contractor/subcontractor of
proving that it has the substantial capital, employees under an employment
investment, tools and the like." (Valencia v. contract of short duration
Classique Vinyl products Corporation, G. R. No. i) Requiring employees under a
206390, January 30, 2017) contracting/subcontracting
arrangement to sign a contract
Other illicit forms of employment fixing the period of employment to a
arrangements term shorter than the term of the
Service Agreement, unless the
The following are hereby declared contract is divisible into phases for
prohibited for being contrary to the law or public which substantially different skills
policy: are required and this is made
known to the employee at the time
a) When the principal farms out work to of engagement.
a “Cabo”. “Cabo” refers to a person j) Such other practices, schemes or
or group of persons or to a labor employment arrangements
group which, under the guise of a designed to circumvent the right of
labor organization, cooperative or workers to security of tenure.
any entity, supplies workers to an (Section 6, D.O. No. 174, Series of
employer, with or without any 2017)
monetary or other consideration,
whether in the capacity of an agent The principal deemed to be the direct
of the employer or as an ostensible employer of the contractor’s or
independent contractor. (Section 3 subcontractor’s employees
[b], D.O. No. 174, Series of 2017)
b) Contracting out of a job or work In the event that there is a finding that the
through an in-house agency. contractor or subcontractor is engaged in labor-
c) Contracting out of job or work only contracting under Section 5 and other illicit
through an in-house cooperative forms of employment arrangements under
which merely supplies workers to Section 6 of these Rules, the principal shall be
the principal. deemed the direct employer of the contractor’[s
d) Contracting out of job or work by or subcontractor’s employees. (Section 7, D.O.
reason of a strike or lockout No. 174, Series of 2017)
whether actual or imminent.

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Contractor’s employees’ rights and

privileges under the Labor Code i. The specific description of the
job or work being subcontracted,
All contractor’s/subcontractor’s including its term or duration.
employees, shall be entitled to security of tenure ii. The place of work and terms
and all the rights and privileges as provided for and conditions governing the
in the Labor Code, as amended, to include the contracting arrangement, to
following: include the agreed amount of
the contracted job or work as
(a) Safe and healthful working well as the standard
conditions; administrative fee of not less
(b) Labor standards such as but not than ten percent (10%) of the
limited to service incentive leave, total contract cost; and
rest days, overtime pay, holiday iii. A provision on the issuance of
pay, 13th month pay and the bond/s defined under
separation pay; Section 3(a) renewable every
(c) Retirement benefits under the SSS, year. (Section 11, D.O. No. 174,
or retirement plans of the Series of 2017)
contractor/subcontractor;
(d) Social security and welfare Effects of violation of the provisions
benefits; and on the rights of contractor’s
(e) Self-organization, collective employees and the required
bargaining and peaceful concerted stipulations in the contracts
activities; including the right to (employment contract and service
strike. (Section 10, D.O. No. 174, agreement under D.O. 174-17
Series of 2017)
A finding of violation of either, shall render
The stipulations required by D.O. No. the principal the direct employer of the
174-17 in the employment contract employees of the contractor or subcontractor,
between the contractor/subcontractor pursuant to Article 109 of the Labor Code, as
and its employees and the service amended. (Section 12, D.O. No. 174, Series of
agreement between the principal and 2017)
the contractor
Job contracting/subcontracting from “labor-
Employment contract between the only” contracting, distinguished
contractor/subcontractor and its employees.
Notwithstanding any oral or written stipulations The following cases distinguished job-
to the contrary, the contractor/subcontractor contracting and labor-only contracting:
between the contractor and its employees shall
be governed by the provisions of Articles 294 1. The Supreme Court in Polyfoam-RGC
and 295 of the Labor Code, as amended, International Corporation vs. Concepcion, G.
including the provisions on general labor R. No. 172349, June 13,2012 citing Sasan, Sr.
standards. It shall include the following v. National Labor Relations Commission 4th
stipulations: Division, G.R. No. 176240, October 17, 2008,
569 SCRA 670 distinguished permissible job
i The specific description of the contracting or subcontracting from “labor-only”
job or work to be performed by contracting, to wit:
the employee; and
ii The place of work and terms “Permissible job contracting or
and conditions of employment, subcontracting refers to an arrangement
including a statement of the whereby a principal agrees to put out or
wage rate applicable to the farm out to a contractor or subcontractor
individual employee. the performance or completion of a
specific job, work or service within a
The contractor/subcontractor shall inform definite or predetermined period,
the employee of the foregoing stipulations in regardless of whether such job, work or
writing on or before the first day of his/her service is to be performed or completed
employment. within or outside the premises of the
principal. A person is considered
Service Agreement between the principal engaged in legitimate job contracting or
and the contractor. The Service Agreement shall subcontracting if the following conditions
include the following: concur:

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contractor for the payment of the employees’

(a) The contractor or wages whenever the contractor fails to pay the
subcontractor carries on a distinct same. In such case, the law creates an
and independent business and employer-employee relationship between the
undertakes to perform the job, work principal employer and the job contractor’s
or service on its own account and employees for a limited purpose, that is, to
under its own responsibility ensure that the employees are paid their wages.
according to its own manner and Other than the payment of wages, the principal
method, and free from the control employer is not responsible for any claim made
and direction of the principal in all by the employees. (Philippine Bank of
matters connected with the Communications vs. NLRC, 146 SCRA 347
performance of the work except as [1986])
to the results thereof;
(b) The contractor or On the other hand, in labor-only
subcontractor has substantial capital contracting, an employer-employee relationship
or investment; and is created by law between the principal employer
(c) The agreement between and the employees of the labor-only contractor.
the principal and contractor or In this case, the labor-only contractor is
subcontractor assures the considered merely an agent of the principal
contractual employees entitlement employer. The principal employer is responsible
to all labor and occupational safety to the employees of the labor-only contractor as
and health standards, free exercise if such employees had been directly employed
of the right to self-organization, by the principal employer. The principal
security of tenure, and social and employer therefore becomes solidarily liable with
welfare benefits. the labor-only contractor for all the rightful
claims of the employees. (Philippine Bank of
In contrast, labor-only contracting, a Communications vs. NLRC, 146 SCRA 347
prohibited act, is an arrangement where [1986])
the contractor or subcontractor merely
recruits, supplies or places workers to Thus, in legitimate job contracting, the
perform a job, work or service for a principal employer is considered only an indirect
principal. In labor-only contracting, the employer, (Article 107, Labor Code, as
following elements are present: amended) while in labor-only contracting, the
principal employer is considered the direct
(a) The contractor or employer of the employees. (last paragraph of
subcontractor does not have Article 106, Labor Code, as amended)
substantial capital or investment to
actually perform the job, work or In short, the legitimate job contractor
service under its own account and provides services while the labor-only contractor
responsibility; and provides only manpower. The legitimate job
contractor undertakes to perform a specific job
(b) The employees recruited, for the principal employer while the labor-only
supplied or placed by such contractor merely provides the personnel to
contractor or subcontractor are work for the principal employer.
performing activities which are
directly related to the main business Solidary liability in labor-only contracting
of the principal.” (Sasan, Sr. v. and job-contracting, distinguished
National Labor Relations
Commission 4th Division, supra, The case of Conjusta v. PPI Holdings
at pp. 689-690. [Citations (formerly Philippine Pizza, Inc.) G.R. No.
omitted]) 252720, August 22, 2022, also gave the
distinctions between solidary liability in
The following distinctions was also legitimate job contracting and in labor-only
observed in PCI Automation Center, Inc. v. contracting. Thus, the Supreme Court said:
NLRC, G.R. No. 115920, January 29, 1996 as
follows: In legitimate job contracting, the law
creates an employer-employee relationship for a
In legitimate job contracting, no employer- limited purpose, i.e., to ensure that the
employee relationship exists between the employees are paid their wages. The principal
employees of the job contractor and the principal employer becomes jointly and severally liable
employer. Even then, the principal employer with the job contractor only for the payment of
becomes jointly and severally liable with the job the employees' wages whenever the contractor

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fails to pay the same. Other than that, the employees. This liability
principal employer is not responsible for any facilitates, if not guarantees,
claim made by the employees. payment of the workers’
compensation, thus, giving the
On the other band, in labor-only workers ample protection as
contracting, the statute creates. an mandated by the 1987
employer-employee relationship for a Constitution. This is not unduly
comprehensive purpose: to prevent a burdensome to the employer.
circumvention of labor laws. The contractor Should the indirect employer be
is considered merely an agent of the constrained to pay the workers,
principal employer and the latter is it can recover whatever amount
responsible to the employees of the labor- it had paid in accordance with
only contractor as if such employees bad the terms of the service contract
been directly employed by the principal between itself and the
employer. The principal employer therefore contractor. (Id. at 1033-1034.
becomes solidarily liable with the labor-only [Citations omitted])
contractor for all the rightful claims of the
employees. Article 107 distinguished from Article 106
and interpretation of "not an employer"
This distinction between job contractor
and labor-only contractor x xx will not discharge In Baguio v. NLRC, G.R. No. 79004-08
[the principal] from paying the separation October 4, 1991 the Supreme Court laid down
benefits of the workers, inasmuch as [the the distinction between Article 106 and 107 of
contractor] was shown to be a labor-only the Labor Code as follows:
contractor; in which case, [the principal's] liability
is that of a direct employer and thus solidarily The distinction between Articles 106
liable with [the contractor]. (Id. at 556-567) and 107 was in the fact that Article 106
(Emphasis supplied) deals with "labor-only" contracting. Here,
by operation of law, the contractor is
Purpose of joint and several liability of merely considered as an agent of the
employer or principal employer, who is deemed "responsible
to the workers to the same extent as if
The case of San Miguel Corporation v. the latter were directly employed by
MAERC Integrated Services, Inc., G.R. No. him." On the other hand, Article 107
144672, July 10, 2003, explained the purpose of deals with "job contracting." In the latter
the enactment of the joint and several liability of situation, while the contractor himself is
the employer or principal: the direct employer of the employees,
the employer is deemed, by operation of
This statutory scheme is designed law, as an indirect employer.
to give the workers ample protection,
consonant with labor and social justice In other words, the phrase "not an
provisions of the 1987 Constitution. employer" found in Article 107 must be
(Manila Electric Company v. read in conjunction with Article 106. A
Benamira, 501 Phil. 621, 644 (2005); contrary interpretation would render the
Mariveles Shipyard Corp. v. Court of provisions of Article 107 meaningless
Appeals, 461 Phil. 249, 267 [2003]) considering that everytime an employer
engages a contractor, the latter is
This Court’s pronouncement in always acting in the interest of the
Rosewood Processing, Inc. v. NLRC, former, whether directly or indirectly, in
352 Phil. 1013 (1998) is noteworthy: relation to his employees.

The joint and several It should be recalled that a finding

liability of the employer or that a contractor is a "labor-only"
principal was enacted to ensure contractor is equivalent to declaring that
compliance with the provisions there is an employer-employee
of the Code, principally those on relationship between the owner of the
statutory minimum wage. The project and the employees of the "labor-
contractor or subcontractor is only" contractor (Associated Anglo-
made liable by virtue of his or American Tobacco Corp. v. Clave,
her status as a direct employer, G.R. No. 50915, 30 August 1990, 189
and the principal as the indirect SCRA 127; Industrial Timber Corp. v.
employer of the contractor’s NLRC, G.R. No. 83616, 20 January

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1989, 169 SCRA 341). This is evidently When one of the solidary
because, as heretofore stated, the debtors cannot, because of his
"labor-only" contractor is considered as insolvency, reimburse his share
a mere agent of an employer. In to the debtor paying the
contrast, in "job contracting," no obligation, such share shall be
employer-employee relationship exists borne by all his co-debtors, in
between the owner and the employees proportion to the debt of each.
of his contractor. The owner of the
project is not the direct employer but Workers preference can be enforced only in
merely an indirect employer, by bankruptcy or liquidation proceedings
operation of law, of his contractor's
employees. 2003, 1999, 1995 and 1992 Bar
Examinations
Remedies of principal on its being made
liable to indirect employees In China Banking Corporation v.
Young, G. R. No. 76061, July 28, 1993 and
2005 and 1992 Bar Examinations China Banking Corporation v. NLRC, G. R.
No. 82566, July 28, 1993, petitioner CBC
In Government Service Insurance argues that the preferential right under Art. 110
System v. National Labor Relations of the Labor Code is not available to NKEI’s
Commission, G.R. No. 180045, November 17, workers in the absence of a bankruptcy or
2010 it was held: insolvency or liquidation proceedings. Thus, the
decision in both labor cases should be enforced
The principal is made liable to its against the foreclosed properties of NKEI. The
indirect employees because, after all, it public and private respondents, upon the other
can protect itself from irresponsible hand, insist that the preferential right of the
contractors by withholding payment of workers over the properties foreclosed, subsists
such sums that are due the employees without the necessity of a declaration of
and by paying the employees directly, or insolvency, bankruptcy or judicial liquidation and
by requiring a bond from the contractor wherever the property goes. The Court said:
or subcontractor for this purpose.
(Rosewood Processing, Inc. v. NLRC, In a number of cases decided by
352 Phil. 1013 [1998]) this Court, it has been repeatedly held
that there must first be a declaration of
xxx bankruptcy or judicial liquidation of the
employer’s business before the worker
It should be understood, though, preference can be enforced just as all
that the solidary liability of petitioner other creditors of the employer company
does not preclude the application of can assert their preferences, if any, only
Article 1217 of the Civil Code on the in the course of a bankruptcy or judicial
right of reimbursement from its co- liquidation proceeding. (See
debtor, viz.: ( Manila Electric Company Development Bank of the Philippines
v. Benamira, 501 Phil. 621, 644 [2005]) v. The Minister of Labor, 195 SCRA
463 (1991); Development Bank of the
Art. 1217. Payment made Philippines v. NLRC, et al., 183 SCRA
by one of the solidary debtors 328 (1990); Philippine National Bank
extinguishes the obligation. If v. Cruz, et al., 180 SCRA 630 (1989);
two or more solidary debtors Development Bank of the Philippines
offer to pay, the creditor may v. The Hon. Secretary of Labor, et al.,
choose which offer to accept. 179 SCRA 630 (1989); Development
Bank of the Philippines v. Hon. Labor
He who made the payment Arbiter Ariel C. Santos, et al., 171
may claim from his co-debtors SCRA 138 [1989])
only the share which
corresponds to each, with the This rule was ushered in by the
interest for the payment already Court’s pronouncement in the case of
made. If the payment is made Republic v. Peralta, 150 SCRA 37
before the debt is due, no (1987) where the Court said:
interest for the intervening
period may be demanded. “Art. 110 of the Labor Code,
in determining the reach of its
terms, cannot be viewed in

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isolation. Rather, Article 110 We also held in PCL Shipping that

must be read in relation to the Article 111 of the Labor Code, as
provisions of the Civil Code amended, contemplates the
concerning the classification, extraordinary concept of attorney’s
concurrence and preference of fees and that Article 111 is an
credits, which provisions find exception to the declared policy of
particular application in strict construction in the award of
insolvency proceedings where attorney’s fees. Although an express
the claims of all creditors, finding of facts and law is still
preferred or non-preferred, may necessary to prove the merit of the
be adjudicated in a binding award, there need not be any
manner. It is thus important to showing that the employer acted
begin by outlining the scheme maliciously or in bad faith when it
constituted by the provisions of withheld the wages. In carrying out
the Civil Code on this subject.” and interpreting the Labor Code's
provisions and implementing
regulations, the employee's welfare
should be the primary and paramount
Concepts of attorney’s fees under Article 111 consideration. This kind of
of the Labor Code interpretation gives meaning and
substance to the liberal and
2016, 2001 and 1993 Bar Examinations compassionate spirit of the law as
embodied in Article 4 of the Labor Code
In Kaisahan at Kapatiran ng mga (which provides that "[a]ll doubts in the
Manggagawa at kawani sa MWC-East Zone implementation and interpretation of the
Union v. Manila Water Company, Inc., G.R. provisions of [the Labor Code], including
No. 174179, November 16, 2011 the Supreme its implementing rules and regulations,
Court explained the concepts of attorney’s fees shall be resolved in favor of labor") and
as follows: Article 1702 of the Civil Code (which
provides that "[i]n case of doubt, all
We explained in PCL Shipping labor legislation and all labor contracts
Philippines, Inc. v. National Labor shall be construed in favor of the safety
Relations Commission, G.R. No. and decent living for the laborer”). (Ibid)
153031, December 14, 2006, 511
SCRA 44 that there are two commonly Object and import of Article 228 [b] (formerly
accepted concepts of attorney’s fees Art. 222 [b])
– the ordinary and extraordinary. In its
ordinary concept, an attorney’s fee is In the case of ABS-CBN Supervisors
the reasonable compensation paid to a Employees Union Members vs. ABS-CBN
lawyer by his client for the legal services Broadcasting Corporation, G.R. No. 106518.
the former renders; compensation is March 11, 1999, March 11, 1999 the Supreme
paid for the cost and/or results of legal Court elucidated the object and import of the
services per agreement or as may be said provision of law citing Bank of Philippine
assessed. In its extraordinary Islands Employees Union - Association
concept, attorney’s fees are deemed Labor Union (BPIEU-ALU) vs. National Labor
indemnity for damages ordered by Relations Commission, 171 SCRA 556, 569
the court to be paid by the losing as follows:
party to the winning party. The
instances when these may be awarded "The Court reads the afore-
are enumerated in Article 2208 of the cited provision (Article 222 [b] of the
Civil Code, specifically in its paragraph 7 Labor Code) as prohibiting the
on actions for recovery of wages, and is payment of attorney's fees only
payable not to the lawyer but to the when it is effected through forced
client, unless the client and his contributions from the workers from
lawyer have agreed that the award their own funds as distinguished
shall accrue to the lawyer as from the union funds. xxx"
additional or part of compensation.
(Id. at 64-65, citing Dr. Reyes v. Court Attorney’s fees in Art. 111 and Art. 228 [b]
of Appeals, 456 Phil. 520, 539-540 (formerly Art. 222 [b]), distinguished
[2003])
Article 111, provides for ten percent (10%)
as the amount to be charged as attorney’s fees

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while Article 228 [b] (formerly Art. 222 [b]) (c) In cases where the employer is
prohibits the payment of attorney's fees to be authorized by law or regulations issued by the
imposed on individual member of the contracting Secretary of Labor and Employment.(Article
union; 113, Labor Code)

Article 111, the attorney’s fees are in As provided under the Rules to Implement
cases of unlawful withholding of wages while the Labor Code
Article 228 [b] (formerly Art. 222 [b]) the
prohibition on attorney’s fees being imposed on Deductions from the wages of the
individual member of the contracting union employees may be made by the employer in any
arising from any collective bargaining of the following cases:
agreement;
(a) When the deductions are authorized
Article 111 of the Labor Code, by law, including deductions for the insurance
contemplates the extraordinary concept of premiums advanced by the employer in behalf of
attorney’s fees. In its extraordinary concept, the employee as well as union dues where the
attorney’s fees are deemed indemnity for right to check-off has been recognized by the
damages ordered by the court to be paid by employer or authorized in writing by the
the losing party to the winning party. The individual employee himself.
instances when these may be awarded are
enumerated in Article 2208 of the Civil Code, (b) When the deductions are with the
specifically in its paragraph 7 on actions for written authorization of the employees for
recovery of wages, and is payable not to the payment to the employer or to a third person
lawyer but to the client, unless the client and and the employer agrees to do so; Provided,
his lawyer have agreed that the award shall That the latter does not receive any pecuniary
accrue to the lawyer as additional or part of benefit, directly or indirectly, from the
compensation while Article 228 [b] (formerly transaction. (Section 10, Rule VIII, Book III,
Art. 222 [b]) as prohibiting the payment of Rules to Implement the Labor Code, as
attorney's fees only when it is effected through amended by Department Order No. 195,
forced contributions from the workers from their Series of 2018)
own funds as distinguished from the union
funds. Deductions allowed by law

Wage deduction The following are the deductions allowed

by law:
2022, 2012 and 1998 Bar Examinations
1. Premiums for SSS (RA 8282),
The general rule on wage deduction is Philhealth (RA 7875), employee’s
that no employer, in his own behalf or in behalf compensation and Pag-ibig (RA 9679) and
of any person, shall make any deduction from withholding tax under the National Internal
the wages of his employees. (Article 113, Revenue Code (NIRC);
Labor Code)
2. In cases where the worker is insured
Exceptions where wage deductions can be with his consent by the employer, and the
allowed deduction is to recompense the employer for the
amount paid by him as premium on the
The following are the exceptions on the insurance under Article 113 [a] of the Labor
prohibition on wage deduction: Code;

(a) In cases where the worker is insured 3. For union dues, in cases where the
with his consent by the employer, and the right of the worker or his union to check-off has
deduction is to recompense the employer for the been recognized by the employer or authorized
amount paid by him as premium on the in writing by the individual worker concerned
insurance; under Article 113 [b] of the Labor Code;

(b) For union dues, in cases where the 4. When the deductions are with the
right of the worker or his union to check-off has written authorization of the employees for
been recognized by the employer or authorized payment to the third person and the employer
in writing by the individual worker concerned; agrees to do so; Provided, That the latter does
and not receive any pecuniary benefit, directly or
indirectly, from the transaction under Section 10

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[b], Rule VIII, Book III, Rules to Implement the enterprise, industry and national
Labor Code; levels;
(c) To prescribe rules and guidelines
5. Deposit for loss or damage under for the determination of appropriate
Article 114 of the Labor Code; minimum wage and productivity
measures at the regional,
6. Agency fees under Article 248 [e] provincial, or industry levels;
(renumbered to Article 254 [e]) of the Labor (d) To review regional wage levels set
Code; by the Regional Tripartite Wages
and Productivity Boards to
7. Withholding of the wages for a debt due determine if these are in
of an employee under Article 1706 of the Civil accordance with prescribed
Code; guidelines and national
development plans;
8. By court order or by way of execution (e) To undertake studies, researches
or attachment of laborer’s wages for debts and surveys necessary for the
incurred for food, shelter, clothing and medical attainment of its functions and
attendance under Article 1708 of the Civil Code; objectives, and to collect and
9. Judgment awarded to employees in compile data and periodically
labor dispute or forced through garnishment of disseminate information on wages
debts is subject to withholding tax on wages and productivity and other related
equivalent to 5% as per RMC 39-2012. information, including, but not
limited to, employment, cost-of-
National Wages and Productivity living, labor costs, investments and
Commission (NWPC) returns;
(f) To review plans and programs of
Republic Act No. 6727 known as the the Regional Tripartite Wages and
“Wage Rationalization Act” provided for the Productivity Boards to determine
creation of the National Wages and Productivity whether these are consistent with
Commission (NWPC). The NWPC is an national development plans;
attached agency of the Department of Labor (g) To exercise technical and
and Employment (DOLE). It is the key policy administrative supervision over the
making body on wages, incomes and Regional Tripartite Wages and
productivity mandated under Republic Act No. Productivity Boards;
6727 known as the Wage Rationalization Act (h) To call, from time to time, a national
(1989) and Republic Act No. 6971 known as tripartite conference of
the Productivity Incentives Act of 1990. Further, representatives of government,
it is vested with the power to prescribe rules workers and employers for the
and guidelines for the determination of consideration of measures to
appropriate minimum wage and productivity promote wage rationalization and
measures at the regional, provincial or industry productivity; and
levels; and authorized the RTWPB to determine (i) To exercise such powers and functions
and fix the minimum wage rates applicable. It as may be necessary to implement this
exercises technical and administrative Act.
supervision over the RTWPBs.
Regional Tripartite Wages and Productivity
Powers and functions of National Wages and Boards (RTWPBs)
Productivity Commission (NWPC)
On June 9, 1989, Republic Act No. 6727
The National Wages and Productivity known as the “Wage Rationalization Act” was
Commission (NWPC) shall have the following approved. The Wage Rationalization Act”
powers and functions: established a new mechanism for minimum wage
determination through the creation of the
(a) To act as the national consultative Regional Tripartite Wages and Productivity
and advisory body to the President Boards (RTWPBs) in all regions of the country. It
of the Philippines and Congress on is mandated to prescribe the minimum wage
matters relating to wages, incomes rates, which should not be lower than the
and productivity; statutory minimum wage rates, and promote
(b) To formulate policies and productivity improvement programs, for all private
guidelines on wages, incomes and enterprise workers in their respective regions,
productivity improvement at the provinces, or industries therein and issue the
corresponding wage orders, subject to the

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guidelines issued by the NWPC. This does not Not later than ten (10) days from the date
cover minimum wage for household helpers and of publication of the Order, any party aggrieved
persons in the personal employ of another. by a Wage Order issued by the Board may
Pursuant to its wage fixing authority, the RTWPB appeal such Order to the Commission by filing a
may issue wage orders which set the daily verified appeal with the Board in three (3) printed
minimum wage rates, based on the standards or legible copies. The appeal shall be accompanied
criteria set by Article 124 of the Labor Code. by a memorandum of appeal which shall state the
grounds relied upon, the arguments in support of
Powers of Regional Tripartite Wages and the appeal and the relief being sought.
Productivity Boards (RTWPBs)
The Board shall serve notice of the appeal
The Regional Boards shall have the to concerned parties. Failure to file an appeal
following powers and functions in their within the reglementary period fixed under this
respective territorial jurisdictions: section or to submit the required documents
shall be a ground for dismissal of the appeal.
(a) To develop plans, programs and
projects relative to wages, incomes A motion for reconsideration on the Wage
and productivity improvement for Order filed with the Board, shall be treated as an
their respective regions; appeal subject to the requisites for the perfection
(b) To determine and fix minimum of appeal under this Rules. (Section 1, Rule V,
wage rates applicable in their NWPC GUIDELINES NO. 01 Series of 2007,
regions, provinces or industries dated June 19, 2007; Art. 123, Labor Code)
therein and to issue the
corresponding wage orders, subject The grounds for appeal from the Wage Order
to guidelines issued by the
Commission; An appeal may be filed on the following
(c) To undertake studies, researches, grounds:
and surveys necessary for the
attainment of their functions, a) non-conformity with prescribed
objectives and programs, and to guidelines and/or procedures;
collect and compile data on wages, b) questions of law;
incomes, productivity and other c) grave abuse of discretion. (Section 2,
related information and periodically Rule V, NWPC GUIDELINES NO. 01 Series of
disseminate the same; 2007, dated June 19, 2007)
(d) To coordinate with the other
Regional Boards as may be Wage Distortion
necessary to attain the policy and
intention of this Code; 2019, 2012, 2009, 2008, 2006, and 1997
(e) To receive, process and act on Bar Examinations
applications for exemption from
prescribed wage rates as may be Procedures to be followed where
provided by law or any Wage wage distortion arises
Order; and
(f) To exercise such other powers and Where wage distortion arises from the
functions as may be necessary to implementation of wage increase it involves
carry out their mandate under this jurisdiction and remedy for its correction. The
Code. (Art. 122, Labor Code) procedures to be followed are:

Effectivity of a wage order 1. Jurisdiction and remedy to

correct wage distortion in case there is a CBA
Any such Wage Order shall take effect
after fifteen (15) days from its complete Where the application of any prescribed
publication in at least one (1) newspaper of wage increase by virtue of a law or wage order
general circulation in the region. (Art. 123, Labor issued by any Regional Board results in
Code) distortions of the wage structure within an
establishment, the employer and the union shall
negotiate to correct the distortions. Any dispute
arising from wage distortions shall be resolved
through the grievance procedure under their
Remedy of an aggrieved party from the wage collective bargaining agreement and, if it
order issued by the RTWPB remains unresolved, through voluntary
arbitration. Unless otherwise agreed by the

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parties in writing, such dispute shall be decided

by the voluntary arbitrators within ten (10) 1. access to employer's records and
calendar days from the time said dispute was premises at any time of the day or night
referred to voluntary arbitration. (fourth whenever work is being undertaken therein, and
paragraph, Article 124, as amended by right to copy therefrom;
Republic Act No. 6727, June 9, 1989) 2. to question any employee, and
3. to investigate any fact, condition or
2. Jurisdiction and remedy to matter relevant to the enforcement of any
correct wage distortion in case there is no provision of the Code and of any labor law,
CBA/recognized labor unions wage order or rules and regulations issued
pursuant thereto. (Article 128 (a), Labor Code
In cases where there are no collective and Section 1, Rule X, Book III, Rules to
agreements or recognized labor unions, the Implement the Labor Code)
employers and workers shall endeavor to correct
such distortions. Any dispute arising therefrom Enforcement power
shall be settled through the National Conciliation
and Mediation Board and, if it remains 2008 Bar Examinations
unresolved after ten (10) calendar days of
conciliation, shall be referred to the appropriate The enforcement power includes the
branch of the National Labor Relations following:
Commission (NLRC). It shall be mandatory for
the NLRC to conduct continuous hearings and 1. To issue compliance order -
decide the dispute within twenty (20) calendar Notwithstanding the provisions of Articles 129
days from the time said dispute is submitted for and 217 of this Code to the contrary, and in
compulsory arbitration. (fifth paragraph, Article cases where the relationship of employer-
124, as amended by Republic Act No. 6727, employee still exists, the Secretary of Labor and
June 9, 1989) Employment or his duly authorized
representatives shall have the power to issue
Meaning of wage distortion compliance orders to give effect to the labor
standards provisions of this Code and other
As used herein, a wage distortion shall labor legislation based on the findings of labor
mean a situation where an increase in employment and enforcement officers or
prescribed wage rates results in the elimination industrial safety engineers made in the course of
or severe contraction of intentional quantitative inspection. (Article 128 (b), Labor Code, as
differences in wage or salary rates between and amended by Republic Act No. 7730, June 2,
among employee groups in an establishment as 1994, and Section 2 [a], Rule X, Book III,
to effectively obliterate the distinctions embodied Omnibus Rules Implementing the Labor
in such wage structure based on skills, length of Code)
service, or other logical bases of differentiation.
(seventh paragraph, Article 124, as amended 2. To issue writs of execution - The
by Republic Act No. 6727, June 9, 1989) Secretary or his duly authorized representatives
Otherwise stated, wage distortion means the shall issue writs of execution to the appropriate
disappearance or virtual disappearance of pay authority for the enforcement of their orders,
differentials between lower and higher positions except in cases where the employer contests
in an enterprise because of compliance with a the findings of the labor employment and
wage order. (P.I. Manufacturing, Incorporated, enforcement officer and raises issues supported
vs. P.I. Manufacturing Supervisors and by documentary proofs which were not
Foremen Association, G. R. No. 167217, considered in the course of inspection. (Article
February 4, 2008 citing Azucena, The Labor 128 (b), Labor Code, as amended by Republic
Code with Comments and Cases, Vol. 1, p. Act No. 7730, June 2, 1994, and Section 2 [b],
301) Rule X, Book III, Rules to Implement the
Visitorial and Enforcement Power Labor Code)

2011, 2008, and 1993 Bar Examinations According to the implementing rules, in
line with the provisions of Article 128 in relation
Visitorial power to Articles 289 and 290 of the Labor Code as
amended in cases, however, where the
The visitorial power of the Secretary of employer contests the findings of the Labor
Labor and Employment or his duly authorized Standards and Welfare Officers and raises
representatives, including Labor Regulations issues which cannot be resolved without
Officers or Industrial Safety Engineers, includes considering evidentiary matters that are not
the following: verifiable in the normal course of inspection, the

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Regional Director concerned shall indorse the (last paragraph of Article 128 (b), Labor
case to the appropriate arbitration branch of the Code, as amended by Republic Act No. 7730,
National Labor Relations Commission for June 2, 1994,Section 4 [a], Rule X, Book III,
adjudication. (Section 2 [a], Rule X, Book III, Omnibus Rules Implementing the Labor
Omnibus Rules Implementing the Labor Code)
Code)
2. In aid of his power of review, the
3. Enforcement power on health and Secretary of Labor and Employment may direct
safety of workers which includes the following: the Bureau of Working Conditions to evaluate
the findings or orders of the Regional Director.
1. To issue order of stoppage of The decision of the Secretary of Labor and
work or suspension of operations - The Employment shall be final and executory.
Secretary of Labor and Employment (Section 4 [b], Rule X, Book III, Omnibus
may likewise order stoppage of work or Rules Implementing the Labor Code)
suspension of operations of any unit or
department of an establishment when “Exception clause,” in the last sentence of
non-compliance with the law or Article 128 (b) of the Labor Code
implementing rules and regulations
poses grave and imminent danger to the 2012 and 2009 Bar Examinations
health and safety of workers in the
workplace. (Article 128 [c], Labor In the case of Meteoro v. Creative
Code and Section 3 [a], Rule X, Book Creatures, Inc., G. R. No. 171275, July 13,
III, Omnibus Rules Implementing the 2009 it was ruled that the power of the Regional
Labor Code) Director to hear and decide the monetary claims
of employees is not absolute. The last sentence
2. Lifting of order of stoppage of of Article 128 (b) of the Labor Code, otherwise
work or suspension of operations - known as the “exception clause,” provides an
Within twenty-four hours, a hearing shall instance when the Regional Director or his
be conducted to determine whether an representatives may be divested of jurisdiction
order for the stoppage of work or over a labor standards case. Thus, the High
suspension of operations shall be lifted Court explained:
or not. In case the violation is
attributable to the fault of the employer, Under prevailing jurisprudence,
he shall pay the employees concerned the so-called “exception clause” has the
their salaries or wages during the period following elements, all of which must
of such stoppage of work or suspension concur:
of operation. (Article 128 [c], Labor
Code and Section 3 [b], Rule X, Book “(a) that the employer
III, Omnibus Rules Implementing the contests the findings of the labor
Labor Code) regulations officer and raises
issues thereon;
4. To keep and maintain employment (b) that in order to
records - The Secretary of Labor and resolve such issues, there is a
Employment may, by appropriate regulations, need to examine evidentiary
require employers to keep and maintain such matters; and
employment records as may be necessary in aid (c) that such matters are
of his visitorial and enforcement powers under not verifiable in the normal
this Code. course of inspection.” (Bay
Haven, Inc., et al. v. Abuan, et
Power of review al., supra; Ex-Bataan Veterans
Security Agency, Inc. v.
The power of review are as follows: Laguesma, supra, at p. 663;
Batong Buhay Gold Mines,
1. The Secretary of Labor and Inc. v. Sec. Dela Serna, 370
Employment, at his own initiative or upon Phil. 872, 887; 312 SCRA 22,
request of the employer and/or employee, may 33 (1999); SSK Parts
review the order of the Regional Director. The Corporation v. Camas, G.R.
order of the Regional Director shall be No. 85934, January 30, 1990,
immediately final and executory unless stayed 181 SCRA 675, 678 [1990])
by the Secretary of Labor and Employment upon
posting by the employer of a reasonable cash or xxx.
surety bond as fixed by the Regional Director.

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Adjudicatory powers under Article 129 of the

Labor Code Corrective labor and social laws on gender
inequality
2012, 1996, 1993 and 1991 Bar
Examinations 1998 Bar Examinations

Article 129 of the Labor Code provides for The provisions of the Labor Code
the adjudicatory powers of the Regional governing the rights of women workers are
Director or any duly authorized Hearing Officer found in Articles 130 to 136 thereof. The former
of the Department of Labor and Employment Articles 130 and 131 providing for nightwork
through summary proceedings and after due prohibition and exceptions therefo has been
notice to hear and decide involving recovery of amended by Republic Act No. 10151, approved
wages and other monetary claims arising from on June 21, 2011. The subsequent articles are
employer-employee relationship presented by renumbered according to express provision of
an employee or person employed in Republic Act No. 10151. Thus, Article 130
domestic/household service, or househelper and (formerly Article 132) is now the provision that
the aggregate money claim, including legal ensures the right of women to be provided with
interest, of each employee or househelper does facilities and standards which the Secretary of
not exceed Five Thousand Pesos (P5,000.00). Labor may establish to ensure their health and
safety while Article 132 (formerly Article 134)
Requisites for the exercise of adjudicatory provides for family planning services; incentives
powers under Article 129 for family planning. For purposes of labor and
social legislation, a woman working in a
In Rajah Humabon Hotel, Inc. v. nightclub, cocktail lounge, massage clinic, bar or
Trajano, G. R. Nos. 100222-23, September 14, other similar establishments shall be considered
1993 the Supreme Court laid down the as an employee under Article 136 (formerly
requisites for the exercise of jurisdiction of the Article 138). Article 133 (formerly Article 135), on
Regional Director or hearing officers under the other hand, recognizes a woman's right
Article 129 of the Labor Code as follows: against discrimination with respect to terms and
conditions of employment on account simply of
Following the consistent doctrine sex. Lastly, Article 134 (formerly Article 136)
announced by this Court in South explicitly prohibits discrimination merely by
Motorists Enterprises vs. Tosoc (181 reason of the marriage of a female employee.
SCRA 386 [1990]), Brokenshire
Memorial Hospital Inc. vs. Minister of
Labor and Employment (182 SCRA 5
[1990]), Servando's Inc. vs. Secretary Discriminations prohibited
of Labor and Employment (184 SCRA
664 [1990]); 198 SCRA 156 [1991], The discriminations prohibited are as
Baritua vs. Secretary of the follows:
Department of Labor and
Employment (204 SCRA 332 [1991]), 1. It shall be unlawful for any employer to
and lately in Midland Insurance discriminate against any woman employee with
Corporation vs. Secretary of Labor respect to terms and conditions of employment
and Employment (214 SCRA 578 solely on account of her sex;
[1992]), there is no doubt that the
regional directors under Republic Act 2. The following are acts of discrimination:
No. 6715, can try money claims only if
the following requisites concur: (a) Payment of a lesser compensation,
including wage, salary or other form of
1. The claim is presented by an remuneration and fringe benefits, to a female
employee or person employed employee as against a male employee, for work of
in domestic or household equal value; and
service, or househelper under (b) Favoring a male employee over a
the code; female employee with respect to promotion,
2. The claimant, no longer being training opportunities, study and scholarship grants
employed, does not seek solely on account of their sexes. (Article 133,
reinstatement; and Labor Code, as amended by Republic Act No.
3. The aggregate money claim of 6725, May 12, 1989)
the employee or housekeeper
does not exceed five thousand Cases of discrimination against women
pesos (P5,000.00).

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In the following cases, the High Court ruled Effect of willful commission of any unlawful act
on the discrimination against women: under Article 133

1. In Halagueñav. Philippine Airlines, Criminal liability for the willful commission of

Inc., G.R. No. 243259, January 10, 2023, the any unlawful act as provided in this Article or any
High Court said: We agree with the trial court. violation of the rules and regulations issued
Respondent was not able to provide any pursuant to Section 2 hereof shall be penalized as
reasonable basis for differentiating the provided in Articles 294 (forermly Art. 288) and 295
compulsory retirement age for female cabin (formerly Art. 289) of this Code.
attendants at 55 years old and the male cabin
attendants at 60 years old. The Court of Actions independent of any criminal action
Appeals' reasoning supports the view that the under Article 133
compulsory retirement age for female cabin
attendants was made lower than their male The institution of any criminal action under
counterparts on the "mere basis of their being this provision shall not bar the aggrieved employee
women." This is discriminatory against women. from filing an entirely separate and distinct action
There is no proof that female cabin attendants, for money claims, which may include claims for
between 55 to 59 years old, do not have the damages and other affirmative reliefs. The actions
"necessary strength to open emergency doors, hereby authorized shall proceed independently of
the agility to attend to passengers in cramped each other. (Article 133, Labor Code, as
working conditions, and the stamina to withstand amended by Republic Act No. 6725, May 12,
grueling flight schedules" as compared with their 1989).
male counterparts. The Court of Appeals'
inference is manifestly mistaken and its
conclusion grounded on speculation, surmises,
or conjectures.

2. In Dela Cruz-Cagampan v. One

Network Bank, Inc., G.R. No. 217414, June Republic Act No. 7877 known as the Anti-
22, 2022 [Per J. Leonen, Third Division] this Sexual Harassment Act of 1995
Court found One Network Bank's no-spouse
employment policy as discriminatory, since it 2022, 2018, 2011, 2009, 2006, 2005,
failed to prove with substantial evidence the 2004, 2003 and 2000 Bar Examinations
factual basis and reasonable business necessity
for its policy. An employer's dismissal of a Republic Act No. 7877 known as the
female employee solely because of her marriage Anti-Sexual Harassment Act of 1995 was
is precisely the discrimination that the Labor approved on February 14, 1995. It is a landmark
Code expressly prohibits. This Court cannot legislation that punishes unwelcome sexual
countenance respondents' unlawful act. advances committed in a work-related,
education or training related environment.
3. In Saudi Arabian Airlines (Saudia) v.
Rebesencio, 750 Phil. 791 (2015) [Per J. Work, Education or Training -Related, Sexual
Leonen, Second Division],the Supreme Harassment Defined
Court found discriminatory Saudia's policy which
terminates the employment of flight attendants Work, education or training-related sexual
who become pregnant, and compelled all harassment is committed by an employer,
personalities acting on behalf of the State, employee, manager, supervisor, agent of the
including this Court, to act pursuant to the employer, teacher, instructor, professor, coach,
constitutional exhortation "to ensure that no trainor, or any other person who, having
discrimination is heaped upon women on the authority, influence or moral ascendancy over
mere basis of their being women[,]" another in a work or training or education
environment, demands, requests or otherwise
4. In Philippine Telegraph and requires any sexual favor from the other,
Telephone Company v. NLRC, G.R. No. regardless of whether the demand, request or
118978, May 23, 1997, the employee was requirement for submission is accepted by the
dismissed in violation of petitioners policy of object of said Act. (Section 3, Republic Act
disqualifying from work any woman worker who No.7877)
contracts marriage. It was ruled that the
company policy violates the right against Sexual harassment are committed in:
discrimination afforded all women workers.
1.Work-related or employment
environment;

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2. Education-related environment; or cooperates in the commission thereof by

3. Training-related environment (Section another without which it would not have
3, Republic Act No. 7877) been committed, shall also be held
liable under this Act. (Section 3,
Sexual harassment in work-related Republic Act No.7877)
environment, education or training
In Domingo v. Rayal, G.R. No. 155831,
The sexual acts in work-related February 18, 2008, Rayala v. Office of the
environment, education or training are defined President, G.R. No. 155840, February 18,
as follows: 2008, Republic of the Philippines v. Rayala
G.R. No. 158700, February 18, 2008, Rayala
(a) In a work-related or employment insisted that the acts do not constitute sexual
environment, sexual harassment is harassment, because Domingo did not allege in
committed when: her complaint that there was a demand, request,
or requirement of a sexual favor as a condition
(1) The sexual favor is made as a for her continued employment or for her
condition in the hiring or in the promotion to a higher position. The Supreme
employment, re-employment or Court held:
continued employment of said
individual, or in granting said individual The law penalizing sexual
favorable compensation, terms of harassment in our jurisdiction is RA
conditions, promotions, or privileges; or 7877. Section 3 thereof defines work-
the refusal to grant the sexual favor related sexual harassment in this wise:
results in limiting, segregating or
classifying the employee which in any Sec. 3. Work, Education or
way would discriminate, deprive or Training-related Sexual
diminish employment opportunities or Harassment Defined. – Work,
otherwise adversely affect said education or training-related
employee; sexual harassment is committed
by an employer, manager,
(2) The above acts would impair the supervisor, agent of the
employee's rights or privileges under employer, teacher, instructor,
existing labor laws; or professor, coach, trainor, or any
other person who, having
(3) The above acts would result in authority, influence or moral
an intimidating, hostile, or offensive ascendancy over another in a
environment for the employee. work or training or education
environment, demands,
(b) In an education or training requests or otherwise requires
environment, sexual harassment is any sexual favor from the other,
committed: regardless of whether the
demand, request or requirement
(1) Against one who is under the for submission is accepted by
care, custody or supervision of the the object of said Act.
offender;
(2) Against one whose education, (a) In a work-related or
training, apprenticeship or tutorship is employment environment,
entrusted to the offender; sexual harassment is committed
(3) When the sexual favor is made when:
a condition to the giving of a passing
grade, or the granting of honors and (1) The sexual favor is made
scholarships, or the payment of a as a condition in the hiring or in
stipend, allowance or other benefits, the employment, re-employment
privileges, or consideration; or or continued employment of
(4) When the sexual advances said individual, or in granting
result in an intimidating, hostile or said individual favorable
offensive environment for the student, compensation, terms,
trainee or apprentice. conditions, promotions, or
privileges; or the refusal to grant
Any person who directs or induces the sexual favor results in
another to commit any act of sexual limiting, segregating or
harassment as herein defined, or who classifying the employee which

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in a way would discriminate, and, after the last incident, filed for a
deprive or diminish employment leave of absence and requested transfer
opportunities or otherwise to another unit.
adversely affect said employee;
(2) The above acts would Effect of the employer’s insensibility to the
impair the employee’s rights or employee's sexual harassment case
privileges under existing labor
laws; or In explaining that employer’s insensibility
(3) The above acts would to its employee’s sexual harassment case is a
result in an intimidating, hostile, ground for constructive dismissal, the High Court
or offensive environment for the in LBC Express-Vis, Inc. v. Palco, G.R. No.
employee. 217101, February 12, 2020, said:

This section, in relation to Section 7 One of the ways by which a hostile

on penalties, defines the criminal aspect or offensive work environment is
of the unlawful act of sexual created is through the sexual
harassment. The same section, in harassment of an employee.
relation to Section 6, authorizes the
institution of an independent civil action Workplace sexual harassment
for damages and other affirmative relief. occurs when a supervisor, or agent of
an employer, or any other person who
xxx has authority over another in a work
environment, imposes sexual favors on
Yet, even if we were to test Rayala’s another, which creates in an
acts strictly by the standards set in intimidating, hostile, or offensive
Section 3, RA 7877, he would still be environment for the latter. Section 3 of
administratively liable. It is true that this Republic Act No. 7877, otherwise
provision calls for a "demand, request or known as the Anti-Sexual Harassment
requirement of a sexual favor." But it is Act, states:
not necessary that the demand, request xxx
or requirement of a sexual favor be
articulated in a categorical oral or written Given these circumstances, the
statement. It may be discerned, with delay in acting on respondent's
equal certitude, from the acts of the case showed petitioner's
offender. Holding and squeezing insensibility, indifference, and
Domingo’s shoulders, running his disregard for its employees' security
fingers across her neck and tickling her and welfare. In failing to act on
ear, having inappropriate conversations respondent's complaint with prompt
with her, giving her money allegedly for and in choosing to let the resolution
school expenses with a promise of of the complaint hang in the air for
future privileges, and making statements a long period of time, it had shown
with unmistakable sexual overtones – all that it did not accord her claims the
these acts of Rayala resound with necessary degree of importance,
deafening clarity the unspoken request and at best considered it a minor
for a sexual favor. infraction that could wait. Petitioner,
it appears, belittled her allegations.
Likewise, contrary to Rayala’s claim,
it is not essential that the demand, xxx
request or requirement be made as a
condition for continued employment or Petitioner's insensibility to
for promotion to a higher position. It is respondent's sexual harassment
enough that the respondent’s acts result case is a ground for constructive
in creating an intimidating, hostile or dismissal. In this instance, it cannot
offensive environment for the employee. be denied that respondent was
(REPUBLIC ACT 7877, Sec. 3 (a) (3); compelled to leave her employment
AO 250, Rule III, Sec. 3 [d]) That the because of the hostile and
acts of Rayala generated an intimidating offensive work environment created
and hostile environment for Domingo is and reinforced by petitioner’s
clearly shown by the common factual Branch's Team Leader and Officer-
finding of the Investigating Committee, in-Charge and petitioner. She was
the OP and the CA that Domingo thus clearly constructively
reported the matter to an officemate dismissed.

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messages or electronic documents.

Republic Act No. 11313 known as Safe (Section 16, RA 11313)
Spaces Act The duties of employers under
Republic Act No. 11313 known as Safe
Republic Act No. 11313 defines and Spaces Act
prescribed penalties on gender-based sexual
harassment in the workplace and in educational Employers or other persons of
and training institutions. authority, influence or moral ascendancy
in a workplace shall have the duty to
The provisions of Republic Act No. prevent, deter, or punish the performance
11313 known as Safe Spaces Act which of acts of gender-based sexual
defined and prescribed penalties on gender- harassment in the workplace. Towards
based sexual harassment in the workplace this end, the employer or person of
and in educational and training institutions authority, influence or moral ascendancy
shall:
1. The crime of gender-based sexual
harassment in the workplace includes the (a) Disseminate or post in a
following: conspicuous place a copy of this Act to all
persons in the workplace;
(a) An act or series of acts involving
any unwelcome sexual advances, (b) Provide measures to prevent
requests or demand for sexual favors or gender-based sexual harassment in the
any act of sexual nature, whether done workplace, such as the conduct of anti-
verbally, physically or through the use of sexual harassment seminars;
technology such as text messaging or (c) Create an independent internal
electronic mail or through any other forms mechanism or a committee on decorum
of information and communication and investigation to investigate and
systems, that has or could have a address complaints of gender-based
detrimental effect on the conditions of an sexual harassment which shall:
individual’s employment or education, job
performance or opportunities; (1) Adequately represent the
management, the employees from the
(b) A conduct of sexual nature and supervisory rank, the rank-and-file
other conduct-based on sex affecting the employees, and the union, if any;
dignity of a person, which is unwelcome, (2) Designate a woman as its head
unreasonable, and offensive to the and not less than half of its members
recipient, whether done verbally, should be women;
physically or through the use of (3) Be composed of members who
technology such as text messaging or should be impartial and not connected
electronic mail or through any other forms or related to the alleged perpetrator;
of information and communication (4) Investigate and decide on the
systems; complaints within ten (10) days or less
upon receipt thereof;
(c) A conduct that is unwelcome and (5) Observe due process;
pervasive and creates an intimidating, (6) Protect the complainant from
hostile or humiliating environment for the retaliation; and
recipient: Provided, That the crime of (7) Guarantee confidentiality to the
gender-based sexual harassment may greatest extent possible;
also be committed between peers and
those committed to a superior officer by a (d) Provide and disseminate, in
subordinate, or to a teacher by a student, consultation with all persons in the
or to a trainer by a trainee; and workplace, a code of conduct or
workplace policy which shall:
(d) Information and communication
system refers to a system for generating, (1) Expressly reiterate the
sending, receiving, storing or otherwise prohibition on gender-based sexual
processing electronic data messages or harassment;
electronic documents and includes the (2) Describe the procedures of the
computer system or other similar devices internal mechanism created under
by or in which data are recorded or stored Section 17(c) of this Act; and
and any procedure related to the (3) Set administrative penalties.
recording or storage of electronic data (Section 17, RA 11313)

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The duties of employees and co- more than Fifteen thousand pesos
workers under Republic Act No. 11313 (₱15,000.00). (Section 19, RA 11313)
known as Safe Spaces Act
Stipulations against marriage
The employees and co-workers shall
have the duty to: 2017, 2012, 2010, 1997 and 1995 Bar
Examinations
(a) Refrain from committing acts of
gender-based sexual harassment; Article 134 of the Labor Code declared the
(b) Discourage the conduct of gander- following as unlawful:
based sexual harassment in the
workplace; 1. To require as a condition of employment
(c) Provide emotional or social support or continuation of employment that a woman
to fellow employees, co-workers, employee shall not get married; or
colleagues or peers who are victims of 2. To stipulate expressly or tacitly that upon
gender-based sexual harassment; and getting married, a woman employee shall be
(d) Report acts of gender-based sexual deemed resigned or separated; or
harassment witnessed in the workplace. 3. To actually dismiss, discharge,
(Section 18, RA 11313) discriminate or otherwise prejudice a woman
employee merely by reason of her marriage.
The liabilities of the employers under (Article 134, Labor Code)
Republic Act No. 11313 known as Safe
Spaces Act While Section 13, Rule XII, Book III,
Rules to Implement the Labor Code provides:
In addition to liabilities for committing acts
of gender-based sexual harassment, employers Section 13. Prohibited
may also be held responsible for: Acts. – It shall be unlawful for
any employer:
(a) Non-implementation of their duties
under Section 17 of this Act, as provided xxx
in the penal provisions; or
(b) Not taking action on reported acts (e) To require as a
of gender-based sexual harassment condition for a continuation of
committed in the workplace. employment that a woman
employee shall not get married
Any person who violates subsection or to stipulate expressly or
(a) of this section, shall upon conviction, tacitly that upon getting married,
be penalized with a fine of not less than a woman employee shall be
Five thousand pesos (₱5,000.00) nor deemed resigned or separated,
more than Ten thousand pesos or to actually dismiss,
(₱10,000.00). discharge, discriminate or
otherwise prejudice a woman
Any person who violates subsection employee merely by reason of
(b) of this section, shall upon conviction, her marriage.
be penalized with a fine of not less than
Ten thousand pesos (₱10,000.00) nor

Sexual harassment under the Safe Spaces Act (RA 11313) distinguished from
sexual harassment under the Anti-Sexual Harassment Act of 1995 (RA 7877)

SAFE SPACES ACT (RA 11313) ANTI-SEXUAL HARASSMENT

ACT OF 1995 (RA 7877)
As to the The act of sexually harassing a The abuse of one's authority,
gravamen of person on the basis of the his/her influence or moral ascendancy so as
the sexual orientation, gender identity to enable the sexual harassment of a
offenses and/or expression. (Escandor v. subordinate. (Escandor v. People,
punished People, G.R. No. 211962, G.R. No. 211962, July 6, 2020)
July 6, 2020)

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Acts The gender-based sexual There is demand, request or

penalized in harassment. (Escandor v. People, otherwise requires any
general G.R. No. 211962, sexual favor from the other in a work-
July 6, 2020) related or employment environment.
(Section 3, RA 7877)

How The crime of The offender demands, requests or

committed gender-based sexual otherwise requires any sexual favor:
harassment in the workplace
includes the following:

(a) An act or series of acts (1) As a condition in the hiring or in

involving any unwelcome sexual the employment, re-employment or
advances, requests or demand continued employment of said
for sexual favors or any act of individual, or in granting said
sexual nature, whether done individual favorable compensation,
verbally, physically or through the terms of conditions, promotions, or
use of technology such as text privileges; or the refusal to grant the
messaging or electronic mail or sexual favor results in limiting,
through any other forms of segregating or classifying the
information and communication employee which in any way would
systems, that has or could have a discriminate, deprive or diminish
detrimental effect on the employment opportunities or
conditions of an individual’s otherwise adversely affect said
employment or education, job employee;
performance or
opportunities;

(b) A conduct of sexual nature (2) The above acts would impair the
and other conduct-based on sex employee's rights or privileges under
affecting the dignity of a person, existing labor laws; or
which is unwelcome,
unreasonable, and offensive to
the recipient, whether done
verbally, physically or through the
use of technology such as text
messaging or electronic mail or
through any other forms of
information and communication
systems;

(c) A conduct that is unwelcome (3) The above acts would result in an
and pervasive and creates an intimidating, hostile, or offensive
intimidating, hostile or humiliating environment for the employee.
environment for the recipient. (Section 3[a], RA 7877)
(Section 16, RA 11313)
Committed The crime of gender-based The employer, employee, manager,
by whom sexual harassment can be supervisor, agent of the employer,
committed between peers and teacher, instructor, professor, coach,
those committed to a superior trainor, or any other person who has
officer by a subordinate, or to a the authority,
teacher by a student, or to a influence, or moral-ascendancy over
trainer by a trainee. (Section 16 another.
(c) RA 11313) (Section 3, RA 7877)
As to The crime of gender-based The offense may only be committed in
setting sexual harassment is committed a work-related
in the workplace
Duties of To prevent, deter, or punish the To prevent or deter the commission of
employers performance of acts of gender- acts of sexual harassment and to
based sexual harassment in the provide the procedures for the
workplace. Towards this end, the resolution, settlement or prosecution

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employer or person of of acts of sexual harassment.

authority, influence or moral Towards this end, the employer or
ascendancy shall: head of office shall:

(a) Disseminate or post in a (a) Promulgate appropriate rules and

conspicuous place a copy of this regulations prescribing the procedure
Act to all persons in the for the investigation of sexual
workplace; harassment cases and the
(b) Provide measures to prevent administrative sanctions therefor.
gender-based sexual harassment (b) Create a committee on decorum
in the workplace, such as the and investigation of cases on sexual
conduct of anti-sexual harassment.
harassment seminars;
(c) Create an independent
internal mechanism or a
committee on decorum and
investigation to investigate and
address complaints of gender-
based sexual
harassment. (Section 17,
RA 11313)

Employees and co-workers shall

have the duty to:

(a) Refrain from committing acts

of gender-based sexual
harassment;
(b) Discourage the conduct of
gander-based sexual harassment
in the workplace;
(c) Provide emotional or social
support to fellow employees, co-
workers, colleagues or peers who
are victims of gender-based
sexual harassment; and

(d) Report acts of gender-based

sexual harassment witnessed in
the workplace. (Section 18, RA
11313)
Liability of In addition to liabilities for The employer or head of office,
Employers committing acts of gender-based educational or training institution shall
sexual harassment, employers may be solidarily liable for damages arising
also be held responsible for: from the acts of sexual harassment
(a) Non-implementation of their committed in the employment,
duties under Section 17 of this Act, education
as provided in the penal provisions; or training environment if the employer
or or head of office, educational or training
(b) Not taking action on reported institution is informed of such acts by
acts of gender-based sexual the offended party and no immediate
harassment committed in the action is taken.
workplace. (Section 19, RA 11313) (Section 5, RA 7877)

Prescriptive Five (5) years (Section 36 [d]), RA Three (3) years

period 11313) (Section 7, RA 7877)
Penalties The penalty of prision Any person who violates the provisions
correccional in its medium period or of this Act shall, upon conviction, be
a fine of not less than One hundred penalized by imprisonment of not less
thousand pesos (₱100,000.00) but than one (1) month nor more than six
not more than Five hundred (6) months, or a fine of not less than

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thousand pesos (₱500,000.00), or Ten thousand pesos (P10,000) nor

both, at the discretion of the court more than Twenty thousand pesos
shall be imposed upon any person (P20,000), or both such fine and
found guilty of any gender-based imprisonment at the discretion of the
online court. (Section 7, RA 7877)
sexual harassment.

If the perpetrator is a
juridical person, its license or
franchise shall be automatically
deemed revoked, and the persons
liable shall be the officers thereof,
including the editor or reporter in
the case of print media, and the
station
manager, editor and broadcaster in
the case of broadcast media. An
alien who commits gender-based
online sexual harassment shall be
subject to deportation proceedings
after serving sentence and payment
of fines. (Section 14, RA 11313)

Any person who violates subsection

(a) of this section, shall upon
conviction, be penalized with a fine
of not less than Five thousand
pesos (₱5,000.00) nor more than
Ten thousand pesos (₱10,000.00).
Any person who violates subsection
(b) of this section, shall upon
conviction, be penalized with a fine
of not less than Ten thousand
pesos (₱10,000.00) nor more than
Fifteen thousand pesos
(₱15,000.00).
(Section 19, RA 11313)
shall afford full protection to labor, local
Cases involving policy or stipulations and overseas, organized and
against marriage unorganized, and promote full
employment and equality of employment
In the following case the Supreme Court opportunities for all." The Labor Code of
ruled on validity of company policy or the Philippines, meanwhile, provides:
stipulations against marriage:
Art. 136. Stipulation against
1. In Cadiz v. Brent Hospital and marriage. It shall be unlawful for
Colleges, Inc., G. R. No. 187417, February 24, an employer to require as a
2016, respondent Brent imposed the condition for condition of employment or
Cadiz to subsequently contract marriage with her continuation of employment that
then boyfriend for her to be reinstated. According a woman employee shall not get
to Brent, this is "in consonance with the policy married, or to stipulate
against encouraging illicit or common-law expressly or tacitly that upon
relations that would subvert the sacrament of getting married, a woman
marriage." In resolving as to whether or not the employee shall be deemed
condition is valid, the Honorable Supreme Court resigned or separated, or to
explained in this manner: actually dismiss, discharge,
discriminate or otherwise
Statutory law is replete with prejudice a woman employee
legislation protecting labor and merely by reason of her
promoting equal opportunity in marriage.
employment. No less than the 1987
Constitution mandates that the "State

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With particular regard to women, policies banning only spouses from

Republic Act No. 9710 or the Magna working in the same company (no-
Carta of Women protects women spouse employment policies), and
against discrimination in all matters those banning all immediate family
relating to marriage and family relations, members, including spouses, from
including the right to choose freely a working in the same company (anti-
spouse and to enter into marriage only nepotism employment policies). (Ibid)
with their free and full consent.
xxx
Weighed against these safeguards,
it becomes apparent that Brent's In challenging the anti-nepotism
condition is coercive, oppressive and employment policies in the United
discriminatory. There is no rhyme or States, complainants utilize two theories
reason for it. It forces Cadiz to marry for of employment discrimination:
economic reasons and deprives her of the disparate treatment and
the freedom to choose her status, which the disparate impact. Under the
is a privilege that inheres in her as an disparate treatment analysis, the
intangible and inalienable right. While a plaintiff must prove that an employment
marriage or no-marriage qualification policy is discriminatory on its face. No-
may be justified as a "bona fide spouse employment policies requiring
occupational qualification," Brent must an employee of a particular sex to
prove two factors necessitating its either quit, transfer, or be fired are
imposition, viz: (1) that the employment facially discriminatory. For example, an
qualification is reasonably related to the employment policy prohibiting the
essential operation of the job involved; employer from hiring wives of male
and (2) that there is a factual basis for employees, but not husbands of female
believing that all or substantially all employees, is discriminatory on its face.
persons meeting the qualification would (Supra, A. Giattina, Challenging No-
be unable to properly perform the duties Spouse Employment Policies As
of the job. Brent has not shown the Marital Status Discrimination)
presence of neither of these factors.
Perforce, the Court cannot uphold the On the other hand, to
validity of said condition establish disparate impact, the
complainants must prove that a facially
2. In Star Paper Corporation v. Simbol, neutral policy has a disproportionate
G. R. No. 164774, April 12, 2006, the Supreme effect on a particular class. For
Court resolved the validity of the following example, although most employment
company policy: policies do not expressly indicate which
spouse will be required to transfer or
1. New applicants will not leave the company, the policy often
be allowed to be hired if in case disproportionately affects one sex. (Ibid)
he/she has [a] relative, up to
[the] 3rd degree of relationship, The state courts rulings on the issue
already employed by the depend on their interpretation of the
company. scope of marital status discrimination
within the meaning of their respective
2. In case of two of our civil rights acts. Though they agree that
employees (both singles [sic], the term marital status encompasses
one male and another female) discrimination based on a person's
developed a friendly relationship status as either married, single,
during the course of their divorced, or widowed, they are divided
employment and then decided on whether the term has
to get married, one of them a broader meaning. Thus, their
should resign to preserve the decisions vary.(Ibid)
policy stated above
The courts narrowly (Whirlpool
With more women entering the Corp. v. Michigan Civil
workforce, employers are also enacting Rights Comm'n, 425 Mich. 527, 390
employment policies specifically N.W.2d 625
prohibiting spouses from working for the (1986); Maryland Comm'n on Human
same company. We note that two types Relations v. Greenbelt Homes, Inc., 300
of employment policies involve spouses: Md. 75, 475 A.2d 1192

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(1984); Manhattan Pizza Hut, Inc. v. employer can prove that the reasonable
New York State Human Rights Appeal demands of the business require a
Bd., 51 N.Y.2d 506, 434 N.Y.S.2d 961, distinction based on marital status and
415 N.E.2d 950 (1980); Thompson v. there is no better available or
Sanborn's Motor Express Inc., 154 N.J. acceptable policy which would better
Super. 555, 382 A.2d 53 [1977]) accomplish the business purpose, an
interpreting marital status to refer only to employer may not discriminate against
a person's status as married, single, an employee based on the identity of
divorced, or widowed reason that if the the employees spouse. (See Muller v.
legislature intended a broader definition BP Exploration (Alaska) Inc., 923 P.2d
it would have either chosen different 783, 73 Fair Empl.Prac.Cas. (BNA) 579,
language or specified its intent. They 69) This is known as the bona fide
hold that the relevant inquiry is if one is occupational qualification exception.
married rather than to whom one is
married. They construe marital status We note that since the finding of a
discrimination to include only whether a bona fide occupational qualification
person is single, married, divorced, or justifies an employers no-spouse rule,
widowed and not the identity, the exception is interpreted strictly and
occupation, and place of employment of narrowly by these state courts. There
one's spouse. These courts have upheld must be a compelling business
the questioned policies and ruled that necessity for which no alternative exists
they did not violate the marital status other than the discriminatory
discrimination provision of their practice. To justify a bona fide
respective state statutes. occupational qualification, the employer
must prove two factors: (1) that the
The courts that have broadly (Ross employment qualification is reasonably
v. Stouffer Hotel Co., 72 Haw. 350, 816 related to the essential operation of the
P.2d 302 (1991); Thompson v. Board of job involved; and, (2) that there is a
Trustees, 192 Mont. 266, 627 P.2d 1229 factual basis for believing that all or
(1981); Kraft, Inc. v. State, 284 N.W.2d substantially all persons meeting the
386 (Minn.1979); Washington Water qualification would be unable to properly
Power Co. v. Washington State Human perform the duties of the job. (Richard
Rights Comm'n, 91 Wash.2d 62, 586 G. Flood and Kelly A. Cahill, The River
P.2d 1149 [1978)]) construed the term Bend Decision and How It Affects
marital status rule that it encompassed Municipalities Personnel Rule and
the identity, occupation and employment Regulations, Illinois Municipal Review,
of one's spouse. They strike down the June 1993, p. 7.)
no-spouse employment policies based
on the broad legislative intent of the The concept of a bona fide
state statute. They reason that the no- occupational qualification is not foreign
spouse employment policy violate the in our jurisdiction. We employ the
marital status provision because it standard of reasonableness of the
arbitrarily discriminates against all company policy which is parallel to the
spouses of present employees without bona fide occupational qualification
regard to the actual effect on the requirement. In the recent case
individual's qualifications or work of Duncan Association of Detailman-
performance. (See note 55, A. Giattina, PTGWO and Pedro Tecson v. Galxo
supra) These courts also find the no- Wllcome Philippines, Inc. G. R. No.
spouse employment policy invalid for 162994, September 17, 2004
failure of the employer to present any we passed on the validity of the policy of
evidence of business necessity other a pharmaceutical company prohibiting
than the general perception that its employees from marrying employees
spouses in the same workplace might of any competitor company. We held
adversely affect the business. (See note that Glaxo has a right to guard its trade
56, ibid) They hold that the absence of secrets, manufacturing formulas,
such a bona fide occupational marketing strategies and other
qualification (Also referred to as BFOQ) confidential programs and information
invalidates a rule denying employment from competitors. We considered the
to one spouse due to the current prohibition against personal or marital
employment of the other spouse in the relationships with employees of
same office. (See note 67, A. Giattina, competitor companies
supra ) Thus, they rule that unless the upon Glaxos employees

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reasonable under the circumstances circumstances because relationships of

because relationships of that nature that nature might compromise the
might compromise the interests interests of the company. In laying down
of Glaxo. In laying down the assailed the assailed company policy, Glaxo only
company policy, we recognized aims to protect its interests against the
that Glaxo only aims to protect its possibility that a competitor company
interests against the possibility that a will gain access to its secrets and
competitor company will gain access to procedures.
its secrets and procedures.(Ibid)
xxx
Petitioners contend that their policy
will apply only when one employee In any event, from the wordings of
marries a co-employee, but they are the contractual provision and the policy
free to marry persons other than co- in its employee handbook, it is clear that
employees. The questioned policy may Glaxo does not impose an absolute
not facially violate Article 136 of the prohibition against relationships
Labor Code but it creates a between its employees and those of
disproportionate effect and under the competitor companies. Its employees
disparate impact theory, the only way it are free to cultivate relationships with
could pass judicial scrutiny is a showing and marry persons of their own
that it is reasonable despite the choosing. What the company merely
discriminatory, albeit disproportionate, seeks to avoid is a conflict of interest
effect. The failure of petitioners to prove between the employee and the
a legitimate business concern in company that may arise out of such
imposing the questioned policy cannot relationships. As succinctly explained by
prejudice the employees right to be free the appellate court, thus:
from arbitrary discrimination based upon
stereotypes of married persons working The policy being questioned is
together in one company. (See A. not a policy against marriage.
Giattina, supra) An employee of the company
remains free to marry anyone of
3. The Supreme Court in Duncan his or her choosing. The policy
Association of Detailman-PTGWO v. Glaxo is not aimed at restricting a
Wellcome Philippines, Inc., G.R. No. 162994, personal prerogative that
September 17, 2004 was confronted a novel belongs only to the individual.
question, with constitutional overtones, involving However, an employee’s
the validity of the policy of a pharmaceutical personal decision does not
company prohibiting its employees from detract the employer from
marrying employees of any competitor company. exercising management
Thus, the High Court ruled in this wise: prerogatives to ensure
maximum profit and business
No reversible error can be ascribed success. . . (Decision of the
to the Court of Appeals when it ruled Court of Appeals, Rollo, p. 28)
that Glaxo’s policy prohibiting an
employee from having a relationship The Court of Appeals also correctly
with an employee of a competitor noted that the assailed company policy
company is a valid exercise of which forms part of respondent’s
management prerogative. Employee Code of Conduct and of its
contracts with its employees, such as
Glaxo has a right to guard its trade that signed by Tescon, was made
secrets, manufacturing formulas, known to him prior to his employment.
marketing strategies and other Tecson, therefore, was aware of that
confidential programs and information restriction when he signed his
from competitors, especially so that it employment contract and when he
and Astra are rival companies in the entered into a relationship with Bettsy.
highly competitive pharmaceutical Since Tecson knowingly and voluntarily
industry. entered into a contract of employment
with Glaxo, the stipulations therein have
The prohibition against personal or the force of law between them and,
marital relationships with employees of thus, should be complied with in good
competitor companies upon Glaxo’s faith." (Article 1159, Civil
employees is reasonable under the Code. See National Sugar Trading

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and/or the Sugar Regulatory disqualified from work any woman

Administration v. Philippine National worker who contracts marriage runs
Bank, G.R. No. 151218, January 18, afoul of the test of, and the right against,
2003, 396 SCRA 528; Pilipinas Hino, discrimination, afforded all women
Inc. v. Court of Appeals, G.R. No. workers by our labor laws and by no
126570, August 18, 2000, 338 SCRA less than the Constitution. Contrary to
355) He is therefore estopped from petitioner's assertion that it dismissed
questioning said policy. private respondent from employment on
account of her dishonesty, the record
xxx discloses clearly that her ties with the
company were dissolved principally
As noted earlier, the challenged because of the company's policy that
policy has been implemented by Glaxo married women are not qualified for
impartially and disinterestedly for a long employment in PT & T, and not merely
period of time. In the case at bar, the because of her supposed acts of
record shows that Glaxo gave Tecson dishonesty.
several chances to eliminate the conflict
of interest brought about by his xxx
relationship with Bettsy. When their
relationship was still in its initial stage, Verily, private respondent's act of
Tecson’s supervisors at Glaxo concealing the true nature of her status
constantly reminded him about its from PT & T could not be properly
effects on his employment with the characterized as willful or in bad faith as
company and on the company’s she was moved to act the way she did
interests. After Tecson married Bettsy, mainly because she wanted to retain a
Glaxo gave him time to resolve the permanent job in a stable company. In
conflict by either resigning from the other words, she was practically forced
company or asking his wife to resign by that very same illegal company policy
from Astra. Glaxo even expressed its into misrepresenting her civil status for
desire to retain Tecson in its employ fear of being disqualified from work.
because of his satisfactory performance While loss of confidence is a just cause
and suggested that he ask Bettsy to for termination of employment, it should
resign from her company instead. Glaxo not be simulated. (Mapalo vs. National
likewise acceded to his repeated Labor Relations Commission, et al.,
requests for more time to resolve the G.R. No. 107940, June 17, 1994, 233
conflict of interest. When the problem SCRA 266; PNOC-Energy Development
could not be resolved after several Corporation vs. National Labor
years of waiting, Glaxo was constrained Relations Commission, et al., G.R. No.
to reassign Tecson to a sales area 79182, September 11, 1991, 201 SCRA
different from that handled by his wife 487) It must rest on an actual breach of
for Astra. Notably, the Court did not duty committed by the employee and
terminate Tecson from employment but not on the employer's caprices. (San
only reassigned him to another area Antonio vs. National Labor Relations
where his home province, Agusan del Commission, et al., G.R. No. 100829,
Sur, was included. In effecting Tecson’s November 21, 1995, 250 SCRA 359;
transfer, Glaxo even considered the Labor vs. National Labor Relations
welfare of Tecson’s family. Clearly, the Commission, G.R. No. 110388,
foregoing dispels any suspicion of September 14, 1995, 248 SCRA 183)
unfairness and bad faith on the part of Furthermore, it should never be used as
Glaxo. (Decision of the Court of a subterfuge for causes which are
Appeals, Rollo, pp. 24-27) improper, illegal, or unjustified.
(Hospicio de San Jose de Basili vs.
4. In Philippine Telegraph and National Labor Relations Commission,
Telephone Company v. National Labor et al., G.R. No. 75997, August 18, 1988,
Relations Commission, G.R. No. 118978, May 164 SCRA 516)
23, 1997, the High Court resolved the issue on
petitioner's policy of not accepting or considering The government, to repeat, abhors
as disqualified from work any woman worker any stipulation or policy in the nature of
who contracts marriage as follows: that adopted by petitioner PT & T. The
Labor Code state, in no uncertain terms,
In the case at bar, petitioner's policy as follows:
of not accepting or considering as

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Art. 136. Stipulation against

marriage. — It shall be unlawful Under American jurisprudence, job
for an employer to require as a requirements which establish employer
condition of employment or preference or conditions relating to the
continuation of employment that marital status of an employee are
a woman shall not get married, categorized as a "sex-plus"
or to stipulate expressly or discrimination where it is imposed on
tacitly that upon getting married, one sex and not on the other. Further,
a woman employee shall be the same should be evenly applied and
deemed resigned or separated, must not inflict adverse effects on a
or to actually dismiss, racial or sexual group which is protected
discharge, discriminate or by federal job discrimination laws.
otherwise prejudice a woman Employment rules that forbid or restrict
employee merely by reason of the employment of married women, but
marriage. do not apply to married men, have been
held to violate Title VII of the United
xxx States Civil Rights Act of 1964, the main
federal statute prohibiting job
It would be worthwhile to reflect discrimination against employees and
upon and adopt here the rationalization applicants on the basis of, among other
in Zialcita, et al. vs. Philippine Air Lines, things, sex. (45A Am. Jur. 2d, Job
Case No. RO4-3-3398-76; February 20, Discrimination, Sec. 506, p. 486)
1977 a decision that emanated from the
Office of the President. There, a policy Further, it is not relevant that the
of Philippine Air Lines requiring that rule is not directed against all women
prospective flight attendants must be but just against married women. And,
single and that they will be automatically where the employer discriminates
separated from the service once they against married women, but not against
marry was declared void, it being married men, the variable is sex and the
violative of the clear mandate in Article discrimination is unlawful. (Ibid., id.,
136 of the Labor Code with regard to id..) Upon the other hand, a requirement
discrimination against married women. that a woman employee must remain
xxx unmarried could be justified as a "bona
fide occupational qualification," or
xxx BFOQ, where the particular
requirements of the job would justify the
The judgment of the Court of same, but not on the ground of a
Appeals in Gualberto, et al. vs. general principle, such as the
Marinduque Mining & Industrial desirability of spreading work in the
Corporation, CA-G.R. No. 52753-R, workplace. A requirement of that nature
June 28, 1978 considered as void a would be valid provided it reflects an
policy of the same nature. In said case, inherent quality reasonably necessary
respondent, in dismissing from the for satisfactory job performance. Thus,
service the complainant, invoked a in one case, a no-marriage rule
policy of the firm to consider female applicable to both male and female flight
employees in the project it was attendants, was regarded as unlawful
undertaking as separated the moment since the restriction was not related to
they get married due to lack of facilities the job performance of the flight
for married women. Respondent further attendants. (Ibid., id., Sec. 507)
claimed that complainant was employed
in the project with an oral understanding Prohibited acts under Article 135 of the Labor
that her services would be terminated Code
when she gets married. Branding the
policy of the employer as an example of 2000 Bar Examination
"discriminatory chauvinism" tantamount
to denying equal employment It shall be unlawful for any employer:
opportunities to women simply on
account of their sex, the appellate court (1) To deny any woman employee the
struck down said employer policy as benefits provided for in this Chapter; or
unlawful in view of its repugnance to the (2) To discharge any woman employed by
Civil Code, Presidential Decree No. 148 him for the purpose of preventing her from
and the Constitution.

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enjoying any of the benefits provided under this Tropicals ground for terminating Belga is her
Code; alleged concealment of pregnancy. Thus, it was
(3) To discharge such woman on account of ruled:
her pregnancy, or while on leave or in confinement
due to her pregnancy; In the instant case, the alleged
(4) To discharge or refuse the admission of misconduct of Belga barely falls within
such woman upon returning to her work for fear the situation contemplated by the law.
that she may again be pregnant. (Article 135, Her absence for 16 days was justified
Labor Code) considering that she had just delivered a
child, which can hardly be considered a
Benefits referred by Article 135 (1) forbidden act, a dereliction of duty;
much less does it imply wrongful intent
The benefits referred are as follows: on the part of Belga. Tropical harps on
the alleged concealment by Belga of her
1. The facilities for women under Article pregnancy. This argument, however,
130; begs the question as to how one can
2. Maternity leave benefits under Article 131 conceal a full-term pregnancy. We
as amended; agree with respondents position that it
3. Family planning services; Incentives for can hardly escape notice how she
Family Planning under Article 132 grows bigger each day. While there may
be instances where the pregnancy may
Prohibited acts as provided under the Rules to be inconspicuous, it has not been
Implement the Labor Code sufficiently proven by Tropical that
Belgas case is such.
It shall be unlawful for any employer:
Belgas failure to formally inform
(a) To discharge any woman employed by Tropical of her pregnancy can not be
him for the purpose of preventing such woman considered as grave misconduct directly
from enjoying the maternity leave, facilities and connected to her work as to constitute
other benefits provided under the Code; just cause for her separation.
(b) To discharge such woman employee
on account of her pregnancy, or while on leave The charge of disobedience for
or in confinement due to her pregnancy; Belgas failure to comply with the
(c) To discharge or refuse the admission memoranda must likewise fail.
of such woman upon returning to her work for Disobedience, as a just cause for
fear that she may be pregnant; termination, must be willful or
(d) To discharge any woman or child or intentional. Willfulness is characterized
any other employee for having filed a complaint by a wrongful and perverse mental
or having testified or being about to testify under attitude rendering the employees act
the Code; and inconsistent with proper subordination.
(e) To require as a condition for a (St. Michaels Institute v. Santos, 422
continuation of employment that a woman Phil. 723, 734 [2001]) In the instant
employee shall not get married or to stipulate case, the memoranda were given to
expressly or tacitly that upon getting married, a Belga two days after she had given
woman employee shall be deemed resigned or birth. It was thus physically impossible
separated, or to actually dismiss, discharge, for Belga to report for work and explain
discriminate or otherwise prejudice a woman her absence, as ordered.
employee merely by reason of her marriage.
(Section 13, Rule XII, Book III, Rules to 2. In Del Monte Philippines, Inc. v.
Implement the Labor Code) Velasco, G. R. No. 153477, March 6, 2007, the
essential question is whether the employment of
Dismissal on account of pregnancy is respondent had been validly terminated on the
unlawful ground of excessive absences without
permission. Corollary to this is the question of
In the following cases, the Supreme Court whether the petitioner discharged the
affirmed the dismissal as illegal being on respondent on account of pregnancy, a
account of pregnancy: prohibited act. In resolving the essential
question and the issue corollary to it, the High
1. In Lakpue Drug, Inc., Croesus Court ruled in this manner:
Pharma, Inc., Tropical Biological Phils., Inc.
(all known as Lakpue Group of Companies) As the CA and the NLRC correctly
v. Belga, G. R. No. 166379, October 20, 2005 noted, it is not disputed that respondent

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was pregnant and that she was suffering 2. Under the effective control or
from urinary tract infection, and that her supervision of the employer for a substantial
absences were due to such facts. The period of time as determined by the Secretary of
petitioner admits these facts in its Labor and Employment, shall be considered as
Petition for Review. And, as the CA an employee of such establishments for
aptly held, it was no less than the purposes of labor and social legislation. (Article
company doctor who advised the 136, Labor Code)
respondent to have rest-in-quarters for
four days on account of a pregnancy- The prohibitions or statutory restrictions on
related sickness. employment of a child

xxx The following are the prohibitions:

The Court agrees with the CA in 1. Prohibition as to the age.

concluding that respondents sickness 2. Prohibition as to worst forms of child
was pregnancy-related and, therefore, labor;
the petitioner cannot terminate 3. Prohibition as to the hours of work; and
respondents services because in doing 4. Prohibition to appear on certain
so, petitioner will, in effect, be violating advertisements and mine labor
the Labor Code which prohibits an
employer to discharge an employee on Amendment to Article 137 (a) of the Labor
account of the latters pregnancy. Code

Article 137 of the Labor Code 2015, 2012, 2007, 2006, 2004, and 2002
provides: Bar Examinations

Art. 137. Article 137 (a) of the Labor Code was

Prohibited acts. It shall already repealed by Republic Act No. 7610, as
be unlawful for any employer: amended by Republic Act Numbers 7658 and
9231. Republic Act No. 7610, known as
xxx "Special Protection of Children Against
Abuse, Exploitation and Discrimination Act",
(2) To discharge was approved on June 17, 1992. Its Article VIII,
such woman on account of Section 12 proscribes the employment of
her pregnancy, while on leave children below fifteen (15) years of age subject
or in confinement due to her to certain exceptions. However, on November
pregnancy; or 9, 1993 Republic Act No. 7658 was approved
amending Section 12, Article VIII of R.A. No.
xxx 7610. Further amendments to its Article VIII,
xxx Section 12 was introduced by Republic Act No.
9231, which was approved on December 19,
The Court is convinced that the 2003. The pertinent amendatory provisions of
petitioner terminated the services of Republic Act No. 9231 are as follows:
respondent on account of her pregnancy
which justified her absences and, thus, Section 2. Section 12 of the same
committed a prohibited act rendering the Act, as amended, is hereby further
dismissal illegal. amended to read as follows:

Classification of certain women workers “Sec. 12. Employment of

Children – Children below
2012, 2008, 1999 and 1997 Bar fifteen (15) years of age shall
Examinations not be employed except:

Status of women workers in certain work “1) When a child works directly
places: under the sole responsibility of
his/her parents or legal guardian
1. Any woman who is permitted or and where only members of
suffered to work with or without compensation, his/her family are employed:
in any night club, cocktail lounge, beer house, Provided, however, That his/her
massage clinic, bar or similar establishments; employment neither endangers
his/her life, safety, health, and
morals, nor impairs his/her

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normal development: Provided, to be denominated as Sections 12-A, 12-B, 12-

further, That the parent or legal C, and 12-D to read as follows:
guardian shall provide the said
child with the prescribed primary “Sec. 12-A. Hours of Work of a
and/or secondary education; or Working Child. – Under the
“2) Where a child’s employment exceptions provided in Section
or participation in public 12 of this Act, as amended:
entertainment or information
through cinema, theater, radio, “(1) A child below fifteen (15)
television or other forms of years of age may be allowed to
media is essential: Provided, work for not more than twenty
That the employment contract is (20) hours a week: Provided,
concluded by the child’s parents That the work shall not be more
or legal guardian, with the than four (4) hours at any given
express agreement of the child day;
concerned, if possible, and the
approval of the Department of “(2) A child fifteen (15) years of
Labor and Employment: age but below eighteen (18)
Provided, further, That the shall not be allowed to work for
following requirements in all more than eight (8) hours a day,
instances are strictly complied and in no case beyond forty (40)
with: hours a week;

“(a) The employer shall ensure “(3) No child below fifteen (15)
the protection, health, safety, years of age shall be allowed to
morals and normal development work between eight o’clock in
of the child; the evening and six o’clock in
“(b) The employer shall institute the morning of the following day
measures to prevent the child’s and no child fifteen (15) years of
exploitation or discrimination age but below eighteen (18)
taking into account the system shall be allowed to work
and level of remuneration, and between ten o’clock in the
the duration and arrangement of evening and six o’clock in the
working time; and morning of the following day.”
“(c) The employer shall
formulate and implement, “Sec. 12-D. Prohibition Against
subject to the approval and Worst Forms of Child Labor. –
supervision of competent No child shall be engaged in the
authorities, a continuing worst forms of child labor. The
program for training and skills phrase “worst forms of child
acquisition of the child. labor” shall refer to any of the
following:
“In the above-exceptional cases
where any such child may be “(1) All forms of slavery, as
employed, the employer shall defined under the “Anti-
first secure, before engaging trafficking in Persons Act of
such child, a work permit from 2003″, or practices similar to
the Department of Labor and slavery such as sale and
Employment which shall ensure trafficking of children, debt
observance of the above bondage and serfdom and
requirements. forced or compulsory labor,
“For purposes of this Article, the including recruitment of children
term “child” shall apply to all for use in armed conflict; or
persons under eighteen (18)
years of age.” “(2) The use, procuring, offering
or exposing of a child for
Also among the amendments to Republic prostitution, for the production of
Act 7610 by Republic Act 9231 includes the pornography or for pornographic
following: performances; or

Section 3. The same Act, as amended, is “(3) The use, procuring or

hereby further amended by adding new sections offering of a child for illegal or

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illicit activities, including the Section 5. Section 14 of the same

production and trafficking of Act is hereby amended to read as follows:
dangerous drugs and volatile
substances prohibited under “Sec. 14. Prohibition on the
existing laws; or Employment of Children in
Certain Advertisements. – No
“(4) Work which, by its nature or child shall be employed as a
the circumstances in which it is model in any advertisement
carried out, is hazardous or directly or indirectly promoting
likely to be harmful to the health, alcoholic beverages, intoxicating
safety or morals of children, drinks, tobacco and its
such that it: byproducts, gambling or any
form of violence or
“a) Debases, degrades or pornography.”
demeans the intrinsic worth and
dignity of a child as a human Department Order No. 65-04 (Implementing
being; or Republic Act No. 9231)
“b) Exposes the child to
physical, emotional or sexual Pursuant to Section 10 of Republic Act
abuse, or is found to be highly No. 9231 (An Act Providing for the Elimination of
stressful psychologically or may the Worst Forms of Child Labor and Affording
prejudice morals; or Stronger Protection for the Working Child,
“c) Is performed Amending for this Purpose Republic Act No.
underground, underwater or at 7610, as amended, Otherwise Known as the
dangerous heights; or Special Protection of Children Against Child
“d) Involves the use of Abuse, Exploitation and Discrimination Act), the
dangerous machinery, Department of Labor and Employment issued on
equipment and tools such as July 26,2004 Department Order No. 65-04, the
power-driven or explosive Rules and Regulations Implementing Republic
power-actuated tools; or Act No. 9231 amending R.A. 7610. The
“e) Exposes the child to essential provisions of the said rules are as
physical danger such as, but not follows:
limited to the dangerous feats of
balancing, physical strength or Coverage
contortion, or which requires the
manual transport of heavy These Rules shall cover all persons and
loads; or entities engaging the services of or employing
“f) Is performed in an children. (Section 1, Department Order No. 65-
unhealthy environment exposing 04, Rules and Regulations Implementing
the child to hazardous working Republic Act No. 9231, Amending R.A. 7610,
conditions, elements, as Amended)
substances, co-agents or
processes involving ionizing, Definition of Terms
radiation, fire, flammable
substances, noxious As used in the Rules, the term:
components and the like, or to
extreme temperatures, noise (a) “Child” refers to any person under 18
levels, or vibrations; or years of age.
“g) Is performed under
particularly difficult conditions; (b) “Child labor” refers to any work or
or economic activity performed by a child that
“h) Exposes the child to subjects him/her to any form of exploitation or is
biological agents such as harmful to his/her health and safety or physical,
bacteria, fungi, viruses, mental or psychosocial development.
protozoans, nematodes and
other parasites; or (c) “Working Child” refers to any child
“i) Involves the engaged as follows:
manufacture or handling of
explosives and other i. when the child is below eighteen
pyrotechnic products.” (18) years of age, in work or economic
activity that is not child labor as defined

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in the immediately preceding sub- household on an occupational basis.

paragraph, and (Section 2, Rule I, Implementing
ii. when the child below fifteen (15) Rules and Regulations of Republic
years of age, (i) in work where he/she is Act 10361)
directly under the responsibility of
his/her parents or legal guardian and Those not covered
where only members of the child’s
family are employed; or (ii) in public The following are not covered:
entertainment or information.
(a) Service providers;
Chapter III, Articles 139 to 150 has been (b) Family drivers;
amended by Republic Act No. 10361 (c) Children under foster family
arrangement; and
According to Section 44, Article X of (d) Any other person who performs
Republic Act No. 10361, all articles or provisions work occasionally or sporadically and not
of Chapter III (Employment of Househelpers) of on an occupational basis. (Section 2,
Presidential Decree No. 442, as amended and Rule I, Implementing Rules and
renumbered by Republic Act No. 10151, and all Regulations of Republic Act 10361)
laws, decrees, executive orders, issuances,
rules and regulations or parts thereof The specific acts declared “unlawful”
inconsistent with the provisions of the said Act under RA 10361
were repealed or modified accordingly.
The following are declared unlawful by RA
Republic Act No. 10361 is an Act 10361:
Instituting Policies for the Protection and Welfare
of Domestic Workers, otherwise known as a. Requiring kasambahay to make
‘Domestic Workers Act’ or Batas Kasambahay. It deposits for loss or damage (Section 14,
was signed on January 18, 2013 by President RA 10361);
Benigno S. Aquino III and became effective on b. Placing the kasambahay under
June 4, 2013 or fifteen (15) days after May 19, debt bondage (Section 15, RA 10361);
2013, the publication in the news papers of c. Employment of children below 15
general circulation (The Philippine Star and the years of age (Section 16, RA 10361);
Manila Times) of its Implementing Rules and d. Charging another household for
Regulations (IRR). temporarily performed tasks; (Section 23,
RA 10361);
e. Interference in the disposal of the
kasambahay’s wages (Section 27, RA
Republic Act No. 10361 ("Domestic Workers 10361);
Act" or "Batas Kasambahay") f. Withholding of the kasambahay’s
wages (Section 28, RA 10361)
2012, 2001, 2009, 2000 and 1998 Bar
Examinations Definition of Terms as provided under RA
10361
Coverage
As used in this Act, the term:
This Act applies to all domestic workers
employed and working within the country. (c) Domestic work refers to work
(Section 3, Article I, Republic Act No. 10361) performed in or for a household or households.

Apply to all parties to an (d) Domestic worker or "Kasambahay"

employment contract for the services of refers to any person engaged in domestic work
the following Kasambahay, whether on within an employment relationship such as, but
a live-in or live-out arrangement, such not limited to, the following: general househelp,
as but not limited to: nursemaid or "yaya", cook, gardener, or laundry
person, but shall exclude any person who
(a) General househelp; performs domestic work only occasionally or
(b) Yaya; sporadically and not on an occupational basis.
(c) Cook The term shall not include children who
(d) Gardener; are under foster family arrangement, and are
(e) Laundry person; or provided access to education and given an
(f) Any person who regularly allowance incidental to education, i.e. "baon",
performs domestic work in one

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transportation, school projects and school

activities. The stipulations that the domestic
worker and employer are allowed to
(f) Household refers to the immediate agree under RA 10361
members of the family or the occupants of the
house that are directly provided services by the Nothing in this provision shall deprive the
domestic worker. (Section 4, Article I, domestic worker and the employer from
Republic Act No. 10361) agreeing to the following:

Rights and Privileges of Kasambahay (a) Offsetting a day of absence with

a particular rest day;
The rights and privileges of the (b) Waiving a particular rest day in
Kasambahay are as follows: return for an equivalent daily rate of pay;
(c) Accumulating rest days not
(a) Minimum wage; exceeding five (5) days; or
(b) Other mandatory benefits, such as (d) Other similar arrangements.
the daily and weekly rest periods, service (Section 21, Article IV, Republic Act No.
incentive leave, and 13th month pay; 10361)
(c) Freedom from employers'
interference in the disposal of wages;
(d) Coverage under the SSS,
Philhealth and Pag-ibig laws;
(e) Standard of treatment;
(f) Board, lodging and medical
attendance;
(g) Right to privacy; Assignment to non-household work
(h) Access to outside communication;
(i) Access to education and training; 2007 Bar Examinations
(j) Right to form, join, or assist labor
organization; The law provides that no domestic worker
(k) Right to be provided a copy of the shall be assigned to work in a commercial,
employment contract as required under industrial or agricultural enterprise at a wage
Section 7, Rule II of this IRR; rate lower than that provided for agricultural or
(l) Right to certificate of employment as nonagricultural workers. In such cases, the
required under Section 6, Rule VII of this IRR; domestic worker shall be paid the applicable
(m)Right to terminate the employment minimum wage. (Section 22, Article IV, Republic
as provided under Section 2, Rule VII of Act No. 10361)
this IRR; and
(n) Right to exercise their own religious Termination Initiated by the Domestic Worker
beliefs and cultural practices. (Section 1, Rule
IV, Implementing Rules and Regulations of The domestic worker may terminate the
Republic Act No. 10361) employment relationship at any time before the
expiration of the contract for any of the following
The rights and privileges of employer causes:
under RA 10361
(a) Verbal or emotional abuse of the
The employer enjoys the following domestic worker by the employer or any
rights: member of the household;
(b) Inhuman treatment including
(a) To require submission of pre- physical abuse of the domestic worker
employment documents by the by the employer or any member of the
Kasambahay (Section 4, Rule II of this household;
lRR); (c) Commission of a crime or offense
(b) To recover deployment expenses against the domestic worker by the
(Section 3, Rule II of this IRR ); employer or any member of the
(c) To demand replacement (Section household;
4, Rule III of this IRR); and (d) Violation by the employer of the
(d) To terminate employment terms and conditions of the employment
(Section 3, Rule VII of this IRR). (Section contract and other standards set forth
1, Rule V, Implementing Rules and under this law;
Regulations of Republic Act No. 10361)

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(e) Any disease prejudicial to the health he/she shall pay the Kasambahay the earned
of the domestic worker, the employer, or compensation plus indemnity in the amount
member/s of the household; and equivalent to fifteen (15) days work. (last
(f) Other causes analogous to the paragraph, Section 3, Rule VII, Implementing
foregoing. (Section 33, Article V, Republic Rules and Regulations of Republic Act No.
Act No. 10361) 10361)

Effect if Kasambahay leaves without cause The mechanism for settlement of disputes
involving domestic worker or kasambahay
If the Kasambahay leaves without cause, under RA 10361
any unpaid salary due, not exceeding the
equivalent of fifteen (15) days work, shall be 1. All labor-related disputes shall be filed
forfeited. In addition, the employer may recover before the DOLE Field/Provincial/Regional
from the Kasambahay deployment expenses, if Office having jurisdiction over the workplace and
any, if the services have been terminated within shall go through the thirty-day (30) mandatory
six (6) months from employment. (last conciliation under the DOLE Single Entry
paragraph, Section 2, Rule VII, Implementing Approach (SEnA) program to exhaust all efforts
Rules and Regulations of Republic Act No. for the settlement of the dispute. (Section 1,
10361) Rule XI, Implementing Rules and Regulations of
Republic Act No. 10361)

2. In case the parties fail to reach a

settlement, a mandatory conference not
Termination Initiated by the Employer exceeding thirty (30) days shall be conducted
by the DOLE Field/Provincial Regional Office
An employer may terminate the services from referral of the unsettled dispute. The
of the domestic worker at any time before the DOLE-Regional Director shall issue a
expiration of the contract, for any of the following Compliance Order within ten (10) days
causes: from the submission of the case for resolution.
(Section 2, Rule XI, Implementing Rules and
(a) Misconduct or willful disobedience by Regulations of Republic Act No. 10361)
the domestic worker of the lawful order
of the employer in connection with the 3. Any aggrieved party may file a motion for
former’s work; reconsideration from the Compliance
(b) Gross or habitual neglect or Order within ten (10) days from receipt thereof.
inefficiency by the domestic worker in (Section 3, Rule XI, Implementing Rules and
the performance of duties; Regulations of Republic Act No. 10361)
(c) Fraud or willful breach of the trust
reposed by the employer on the 4. The Resolution on the Motion for
domestic worker; Reconsideration of the DOLE-Regional Director
(d) Commission of a crime or offense by may be appealed to the Secretary of Labor and
the domestic worker against the person Employment within ten (10) days from receipt
of the employer or any immediate thereof. Thereafter, the Order of the Secretary of
member of the employer’s family; Labor and Employment shall be final and
(e) Violation by the domestic worker of executory. (Section 4, Rule XI, Implementing
the terms and conditions of the Rules and Regulations of Republic Act No.
employment contract and other 10361)
standards set forth under this law;
(f) Any disease prejudicial to the health Homeworker
of the domestic worker, the employer, or
member/s of the household; and 2017 and 2000 Bar Examinations
(g) Other causes analogous to the
foregoing. (Section 34, Article V, Republic Act Definitions
No. 10361)
The following terms shall have the
Effect if employer dismissed Kasambahay meanings indicated hereunder:
without cause
(a) “Industrial Homework” is a system of
2011 Bar Questions production under which work for an employer or
contractor is carried out by a homework at
If the employer dismissed the his/her home. Materials may or may not be
Kasambahay for reasons other than the above, furnished by the employer or contractor. It differs

2024 Bar Review Notes on Critical Areas in Labor Law Part I by Jurists Bar Review Center. © 2024 by
Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
shall be subjected to criminal prosecution and administrative charges, including the appropriate complaint
with the Bar Confidant’s Office and IBP.
Page 83 of 84
 JURISTS BAR REVIEW CENTERTM
2024 JURISTS PRE-BAR REVIEW PROGRAM

from regular factory production principally in

that, it is a decentralized form of production (e) Telecommuting program refers to a set
where there is ordinarily very little supervision or of guidelines and rules governing the
regulation of methods of work. implementation of a telecommuting work
arrangement. (Section 2, IRR of RA 11165)
(b) “Industrial Homeworker” means a
worker who is engaged in industrial homework. Telecommuting program under RA 11165
(Section 2, Rule XIV, Book II, Rules to
Implement the Labor Code) An employer in the private sector may
offer a telecommuting program to its
employees on a voluntary basis or as a
result of collective bargaining, if any, and
upon such terms and conditions as they
may mutually agree upon: Provided, That
such terms and conditions shall not be
RA 11165 known as the "Telecommuting less than the minimum labor standards
Act" set by law, and shall include compensable
work hours, minimum number of work
This is the law that provides for a “work hours, overtime, rest days, entitlement to
arrangement which allows an employee in the leave benefits, social welfare benefits,
private sector to work from an alternative and security of tenure. In all cases, the
workplace with the use of telecommunication employer shall provide the telecommuting
and/or computer technologies.” The alternative employee with relevant written information
workplace refers to a location other than the in order to adequately apprise the
regular. individual employee of the terms and
conditions of the telecommuting program,
The following are salient features of including the duration of the program,
Republic Act No. 11165 otherwise known as the rights, duties, and responsibilities of the
"Telecommuting Act": employee. (Section 3, IRR of RA 11165)

Definitions under RA 11165 known as the Night worker

"Telecommuting Act" define the following”
Night worker means any employed person
(a) Alternative workplace whose work requires performance of a
(b) Telecommuting substantial number of hours of night work which
(c) Telecommuting agreement exceeds a specified limit. (Article 154, Labor
(d) Telecommuting employee Code) According to Section 2, Rule XV, Book III,
(e) Telecommuting program Omnibus Rules Implementing the Labor Code,
as per Department Order No. 112-12 Series of
As used in this Rules, the following terms 2012, as used herein, “night worker” means any
shall mean: employed person whose work covers the period
from 10 o’clock in the evening to 6 o’clock the
(a) Alternative workplace refers to a following morning provided that the worker
location other than the regular workplace; performs no less than seven (7) consecutive
hours of work.
(b) Telecommuting refers to a work
arrangement that allows an employee in the Those who are not covered on nightwork
private sector to work from an alternative under the Labor Code
workplace with the use of telecommunication
and/or computer technologies; Except those employed in agriculture,
stock raising, fishing, maritime transport and
(c) Telecommuting agreement refers to inland navigation, during a period of not less
the mutual consent of the employer and the than seven (7) consecutive hours, including the
employee in the implementation of a interval from midnight to five o’clock in the
telecommuting work arrangement based on the morning. (Article 154, Labor Code)
telecommuting program of the company,
Collective Bargaining Agreement (CBA), if any,
and other company rules and regulations;

(d) Telecommuting employee refers to a

person who is on a telecommuting work
arrangement; and

2024 Bar Review Notes on Critical Areas in Labor Law Part I by Jurists Bar Review Center. © 2024 by
Jurists Review Center Inc. Copying, dissemination, storage, use, modification, uploading, and
downloading without the express written consent of Jurists Review Center Inc. is strictly prohibited and
shall be subjected to criminal prosecution and administrative charges, including the appropriate complaint
with the Bar Confidant’s Office and IBP.
Page 84 of 84