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This document provides a summary of key labor relations concepts in the Philippines based on a review questions. It addresses topics like security of tenure, agency fees, probationary employees, just causes for termination, types of employees (regular, project, seasonal, casual), consequences of illegal dismissal, and statutes of limitations for various labor-related legal actions. Preventive suspension is also discussed as a means for employers to preclude employees from work pending an investigation into alleged misconduct.
This document provides a summary of key labor relations concepts in the Philippines based on a review questions. It addresses topics like security of tenure, agency fees, probationary employees, just causes for termination, types of employees (regular, project, seasonal, casual), consequences of illegal dismissal, and statutes of limitations for various labor-related legal actions. Preventive suspension is also discussed as a means for employers to preclude employees from work pending an investigation into alleged misconduct.
This document provides a summary of key labor relations concepts in the Philippines based on a review questions. It addresses topics like security of tenure, agency fees, probationary employees, just causes for termination, types of employees (regular, project, seasonal, casual), consequences of illegal dismissal, and statutes of limitations for various labor-related legal actions. Preventive suspension is also discussed as a means for employers to preclude employees from work pending an investigation into alleged misconduct.
Security of tenure is defined as the right not to be removed from ones job without valid cause and valid procedure; it extends to regular (permanent) as well as nonregular (temporary) employment. Security of tenure may be for a limited period or for an unlimited period. The labor code provides that in cases of regular employment, the employer shall not terminate the services of an employee except for a just cause or for an authorized cause under the code. Further, an employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowance, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement. 2. What is an agency fee? Agency fee is an amount equivalent to union dues which a nonunion member pays to the union because he benefits from the CBA negotiated by the union. It is an agency fee because in negotiating the CBA, the union served as the employees agent. There would be unjust enrichment on the part of the nonunion member if he derives benefit from the efforts of the negotiating union without giving his contribution thereto.
Yes, if the business is not losing but its owner, for
reasons of his own, wants to get out of the business, he in good faith can lawfully do so anytime. Just as the law forces no one to enter into business, no law compels anybody to stay in business. But the employees should be paid the severance pay. The requisites for closure of business are as follows: (1) That it must be done in good faith; (2) That there must a one (1) month notice to the DOLE and the employees; and (3) There must be separation pay to employees which is equivalent to one (1) month pay or one-half (1/2) month pay for every year of service, whichever is higher; but, according to recent jurisprudence, if there are NO losses at all, it must be one (1) month pay for every year of service. 5. What if there were losses? Would the answer in Number 4 be the same? The answer would depend on whether the loss is serious or not. If the firm faces serious business losses or financial reverses, the employer is not required by law to pay separation pay. However, if the loss or financial reverses are not so serious, the employer is required to pay one month pay or one-half month pays for every year of service, whichever is higher, the fraction of 6 months considered as one year.
3. What is a probationary employee?
A probationary employee is one who is under observation by an employee to determine whether or not he is qualified for permanent employment. Under the labor code, probationary employment shall not exceed six (6) months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period. The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of his engagement. An employee who is allowed to work after the probationary period shall be considered a regular employee.
The employer is, nonetheless, still required to
give 2 notices still: one to the DOLE and one to the employees. Failure to comply with the procedural requirement shall hold the employer liable to pay indemnity for the violation of procedural due process. 6. What are the 4 kinds of separation pay? (a) Statutory requirement for authorized causes; (b) Financial assistance (social justice); (c) In lieu of reinstatement where reinstatement is not feasible; (d) Benefit in the CBA or company policy. 7. What are the consequences of illegal dismissal? The following are the consequences of illegal dismissal: (1) Reinstatement. This has the consequence of restoring the employee to his previous position quo ante prior to the dismissal
without the loss of seniority rights and other
benefits; (2) Backwages. It is the amount of money given to the employee as compensation for earnings lost from the time he or she was illegally dismissed up to the time of actual reinstatement. This includes basic pay and benefits ordinarily enjoyed by the employee including 13th month pay. Full backwages should be paid; (3) Separation pay in lieu of reinstatement. This is required pursuant to the doctrine of strained relations. The employees covered under this usually includes those managerial and supervisory employees who needs the trust and confidence of management as a prerequisite for continued employment; (4) Damages. Damages can either be moral, exemplary or nominal. Moral damages may be awarded for the besmirched reputation, wounded feelings, mental anguish or sleepless nights which the employee has suffered as a result of the dismissal which was tainted with bad faith or fraud. Exemplary damages may be awarded in case the dismissal was done in a wanton and oppressive manner. Nominal damages may be awarded when the procedural due process requirements are not complied with. 8. Discuss the prescription of actions in labor. 1 year for unfair labor practices from the time of accrual of such unfair labor practice; 4 years action for reinstatement by reason of illegal dismissal which shall from the time of dismissal; and 3 years action for money claims which runs from the time the cause of action accrued. 9. What are the just causes for termination? SGFCO JUST CAUSES (Art. 296, as amended) (a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work; (b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of
the trust reposed in him by his employer or duly authorized representative; (d) Commission of a crime or offense by the employee against the person of his employer or any member of his family or his duly authorized representative; and (e) Other cases analogous to the foregoing. 10. What is a fixed-period contract of employment? Fixed period employment contracts are not limited to those which are seasonal or for specific projects with predetermined dates of completion; they also include those to which the parties by free choice have assigned a specific date of termination. The case of Brent Schoo, Inc. vs Zamora laid down the requisites for a valid fixed-period employment contract, viz: (1) The fixed period of employment was KNOWINGLY and VOLUNTARILY agreed upon by the parties without any fraud, duress, or improper pressure; (2) It appears that the employer and employee dealt with each other on a, more or less, equal terms with no MORAL DOMINANCE exercised by the former or the latter. 11. Who are regular employees? The labor code provides that the provisions of written contracts to the contrary notwithstanding and regardless of the oral agreement of the parties, an employee shall be deemed regular if he has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer. 12. Who are fixed-term or project employees and seasonal employees? Even if employees are engaged to perform activities which are usually necessary or desirable in the in the usual trade or business of the employer, they are not regular employees where: (1) the employment has been fixed for a specific project or undertaking the completion of which has been determined at the time of the engagement of the employee; or (2) where the work or services to be performed is seasonal in nature and the employment is for the duration of the season; The first is classified as project employees whereas the second are considered seasonal employees.
13. Who are casual employees?
Where an employee does not fall under the category of regular, project or seasonal employees, such employee shall be deemed a casual employee; except when such employee has performed more than one (1) year, whether continuous or broken. In which case, they shall be deemed regular employees. 14. Can seasonal employees be considered regular? Yes, a seasonal employee can become a regular employee if his contract is successively renewed every season for a period exceeding one year and provided that he is engaged to perform activities which are usually necessary or desirable in the usual trade or business of the employer. The regular seasonal employees are not, strictly speaking, separated from the service during offseason but are merely considered as on leave of absence without pay until they are re-employed. Their employment relationship is not severed but is merely suspended. 15. Can a project employee become a regular employee? Yes, jurisprudence provides that a project employee or a member of a workpool may acquire the status of regular when the following concur: (1) There is continuous rehiring of project employees even after cessation of a project; and (2) The tasks performed by the alleged project employee are vital, necessary and indispensable to the usual business or trade of the employer. 16. Can casual employees?
employees
become
regular
Yes, when the casual employee has provided for
services to the employer for more than one year, whether continuous or broken. 17. What is preventive suspension? Discuss its nature and extent. Preventive suspension is the means by which an employer precludes the employee from reporting for work and performing his work thereunder for the protection of the companys property pending investigation of any alleged malfeasance or misfeasance committed by the employee. The implementing rules of the labor code provides that the employer may place the worker
concerned under preventive suspension if his
continued employment poses a serious and imminent threat to the life or property of the employer or of his co-workers. The main purpose of preventive suspension is to provide the management or the appropriate investigation committee the chance to thoroughly examine the circumstances and the extent of the alleged malfeasance. If the employee is not preventively suspended, he or she may tamper with the evidence necessary for the proper investigation of the offense. The preventive suspension must not exceed 30 days; otherwise, it would be deemed a constructive dismissal. Nonetheless, management has the discretion to extend the preventive suspension provided that it reinstates the employee under preventive suspension to its payroll and resume paying him his pay even if he is not physically present and dispensing his job. 18. Discuss the retirement. Retirement is the result of bilateral act of the parties, a voluntary agreement between the employer and the employee whereby the latter, after reaching a certain age, agrees and/or consents to sever his employment with the former. The labor code provides that unless through a Collective Bargaining Agreement or other employment contract providing for greater benefits, an employee upon reaching the age of 60 or the compulsory age of retirement of 65 years old, who has served the company for at least 5 year, may retire and shall be entitled to one-half month pay for every year of service, a fraction of 6 months shall be deemed one year. Unless the parties provide for broader inclusions, the term one-half month pay shall mean 15 days plus one-twelfth of the 13 th month pay and cash equivalent of no more than 5 days of service incentive leaves. In simpler terms, it is approximately 22.5 days for every year of service. This law does not apply to: (1) Domestic household servants; (2) Retail, service, and agricultural establishments employing no more than 10 employees; (3) Government employees; and (4) Underground mining employees who may retire upon reaching age 50 but not to exceed 60 years old, being their compulsory age of retirement, and who having served at least 5 years in the company
19. What are the four authorized causes? Explain
each. The authorized causes for termination are as follows: (a) Introduction of labor-saving devices this include the substitution of manual labor in factories by machineries and equipment; it may also include the outsourcing of several departments of the company which may include its security, janitorial and maintenance departments, and such other management prerogative to cut labor expenditures; (b) Redundancy occurs when there is superfluity of in the labor force of a company such as when there is an excess of what may be required in the operations of the business. This arises as a result of overhiring, or a closure of certain business or product line and such other circumstances where certain employee functions are deemed superfluous. (c)
Retrenchment occurs when there is
imminent or actual losses experienced by the employer and it becomes necessary to terminate some employees in order to prevent worsening the companys financial condition. This is distinguished from redundancy in the sense that in redundancy, there is yet no imminent or actual loss by the company, though both redundancy and retrenchment may have the same causes.
(d) Closure of business this may be due to
serious business losses or financial reverses or not. If case of serious business losses or financial reverses, a business indefinitely suspends operations and therefore ceases to employ the workers. If not due to serious business losses or financial reverses, it may be one caused by merger, consolidation, or sale in good faith by the employer of his business or it may also be just the decision of the employer to cease operations in good faith. 20. What are the obligations of the employer if it terminates an employee for authorized cause? First of all, the employer is duty bound to give notice, at least 30 days before effecting the termination, written notices to both the appropriate Regional Office of the DOLE and the employee. The notice required is individual notice. Thus, notice in the bulletin board is insufficient as this is collective notice.
The employer is also duty bound to pay
separation pay depending on the reason for the termination, viz: (1) For introduction of labor-saving devices and/or redundancy the employer is required to pay a separation pay equivalent to one month pay or one month pay for every year of service, whichever is higher, fraction of 6 months is considered 1 year; (2) For retrenchment and/or closure of business NOT due to serious business losses or financial reverses, the employer is required to pay separation pay equivalent to one month or one-half month pay for every year of service, whichever is higher, fraction of 6 months considered 1 year. (3) For closure of business due to serious business loses or financial reverses, no separation pay is required. The employer in dismissing the employee must also be in good faith such that the termination of employment is not merely on inexistent grounds and should not be made to subterfuge in order to get rid of unwanted employees or to subvert the impending organization of labor, in which case, it shall tantamount to unfair labor practice. If the termination is due to losses, there must be sufficient evidence that the loss is grave enough to justify the termination of employment. 21. What are the four kinds of separation pay? (a) Separation pay as employers statutory obligation in cases of legal termination due to authorized causes; (b) Separation pay as financial assistance, as an act of social justice, even in case of legal dismissal, at courts discretion; (c) Separation pay in lieu of reinstatement in illegal dismissal cases where the employee is ordered reinstated but reinstatement is infeasible; and (d) Separation pay as an employment benefit granted in a CBA or company policy. 22. Define resignation. Resignation is a voluntary act of the employee where his personal reason cannot be sacrificed over the urgency of service, and he has no choice but to disassociate himself from the company. 23. How may an employee terminate employeremployee relationship without just cause? An employee may terminate without just cause the EE relationship by serving a written notice on the employer at least one (1) month in advance;
the employer upon whom no such notice was
given may hold the employee liable. 24. How may an employee terminate employeremployee relationship without giving notice? An employee may terminate the EE without serving notice to employer for any of the following causes: (1) Serious insult by the employer or his representative on the honor and person of the employee; (2) Inhuman and unbearable treatment accorded the employee by the employer or his representative; (3) Commission of a crime or offense by the employer or his representative against the person of the employee or any of the immediate member of his family; and (4) Other cases analogous to the foregoing.
JUST CAUSE Grounds
Procedural due process
Consequences
(1) Serious misconduct or willful
disobedience by the employee of the lawful orders of his employer or representative in connection with his work; (2) Gross and habitual neglect by the employee of his duties; (3) Fraud or willful breach by the employee of the trust reposed on him by his employer or duly authorized representative; (4) Commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representative; and (5) Other analogous causes to the foregoing. (1) Written notice specifying the ground for termination; (2) Hearing or conference during which an employee is given the opportunity to respond to the charge, present his evidence, or rebut the evidence presented against him (opportunity to be heard); Note: reasonable opportunity to be heard is at least 5 days (3) Written notice of termination. -General rule: No financial assistance required -Exception: For analogous cases (No. 5 ground), the court may opt to grant separation pay anchored on social justice.
AUTHORIZED CAUSE (1) (2) (3) (4)
Installation of labor-saving device;
Redundancy; Retrenchment to prevent losses; Closure or cessation of operation of establishment/undertaking (a) Due to serious business losses or financial reverses; and (b) Not due to serious business losses or financial reverses (5) Disease where his continued employment is: (a) Prohibited by law; (b) detrimental to his health; or (c) detrimental to his co-workers
COMP
Work is co
Service of written notice (two-notice requirement) at
least 30 days before effectivity to: (1) The appropriate Regional Office of the DOLE; and (2) The employees
No notice r must repor nearest Pu statistical p
-For (1) and (2): 1 month pay or 1 month pay for
every year of service, whichever is higher, 6mos=1yr -For (3) and (4-B): 1 month pay or month pay for every year of service, whichever is higher, 6mos=1yr -For (4-a): none required -For (5): 1 month pay or month pay for every year of service, whichever is higher, 6mos=1yr