I

Narciso filed a complaint against Norte University for the payment of retirement benefits after
having been a part-time professional lecturer in the same school since 1974. Narciso taught for
two semesters and a summer term for the school year 1974-1975, took a leave of absence from
1975 to 1977, and resumed teaching until 2003. Since then, his contract has been renewed at the
start of every semester and summer, until November 2005 when he was told that he could no
longer teach because he was already 75 years old. Norte University also denied Narciso's claim
for retirement benefits stating that only full-time permanent faculty, who have served for at least
five years immediately preceding the termination of their employment, can avail themselves of
post-employment benefits. As part-time faculty member, Narciso did not acquire permanent
employment status under the Manual of Regulations for Private Schools, in relation to the Labor
Code, regardless of his length of service.

(a) Is Narciso entitled to retirement benefits? (2.5%)

(b) If he is entitled to retirement benefits, how should retirement pay be computed in the
absence of any contract between him and Norte University providing for such benefits? (2.5%)

Answer

a. Yes, Narciso is entitled to retirement benefits.

A part-time lecturer, with a fixed-term employment, who did not attain permanent status, is entitled to
retirement pay. This was ruled by the Supreme Court in De La Salle Araneta University v. Bernardo, G.
R. No. 190809, February 13, 2017 as follows: Republic Act No. 7641 states that "any employee may be
retired upon reaching the retirement age x x x;" and "[i]n case of retirement, the employee shall be
entitled to receive such retirement benefits as he may have earned under existing laws and any
collective bargaining agreement and other agreements." The Implementing Rules provide that Republic
Act No. 7641 applies to "all employees in the private sector, regardless of their position, designation or
status and irrespective of the method by which their wages are paid, except to those specifically
exempted x x x." And Secretary Quisumbing' s Labor Advisory further clarifies that the employees
covered by Republic Act No. 7641 shall "include part-time employees, employees of service and other
job contractors and domestic helpers or persons in the personal service of another."

Here, Narciso is entitled to retirement benefits since the law specifically states that all employees,
regardless of their position shall be entitled to retirement benefits regardless of their position. Narciso,
being a part-time lecturer does not change the application of the law.

b. The retirement will be 22.5 days salary, exclusive of leave conversion benefits.

According to Capitol Wireless, Inc. v. Honorable Secretary Ma. Nieves R. Confessor, G.R. No. 117174,
November 13,1996: For purposes of computing compulsory sand optional retirement benefits and to
align the current retirement plan with the minimum standards of Art. 287 of the Labor Code, as
amended by R.A. 7641, and Sec. 5 (5.2) of its implementing rules, “1/2 month salary” means 22.5 days
salary, exclusive of leave conversion benefits.

Unless the parties provide for broader inclusions, the term ‘one-half (1/2) month salary’ shall mean
fifteen (15) days plus one-twelfth (1/12) of the 13th month pay and the cash equivalent of not more
than five (5) days of service incentive leaves x x x x

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 II
Nayon Federation issued a charter certificate creating a rank-and-file Neuman Employees Union.
On the same day, New Neuman Employees filed a petition for certification election with the
Department of Labor and Employment (DOLE) Regional Office, attaching the appropriate charter
certificate.

a) The employer, Neuman Corporation, filed a motion to dismiss the petition for lack of legal
personality on the part of the petitioner union. Should the motion be granted? (2.5%)

The motion should be denied. For purposes of filing a petition for certification election, New Neuman
Employees has legal personality from the time it was issued with a charter certificate. This clear under the
Labor Code, which provides, The chapter shall acquire legal personality only for purposes of filing a petition for
certification election from the date it was issued a charter certificate.

b) The employer likewise filed a petition for cancellation of union registration against New
Neuman Employees Union, alleging that Nayon Federation already had a chartered local rank-
and-file union, Neuman Employees Union, pertaining to the same bargaining unit within the
establishment. Should the petition for cancellation prosper? (2.5%)

Under Article 247 of the Labor Code, the following are the relevant grounds for cancellation of union
registration:
(a) Misrepresentation, false statement or fraud in connection with the adoption or ratification of the
constitution and by-laws or amendments thereto, the minutes of ratification, and the list of members who took
part in the ratification;
(b) Misrepresentation, false statements or fraud in connection with the election of officers, minutes of the
election of officers, and the list of voters;
(c) Voluntary dissolution by the members.

Unless the employer can prove that any of the foregoing grounds are present the petition for cancellation will
not prosper.

III
Due to his employer’s dire financial situation, Nicanor was prevailed upon by his employer
to voluntarily resign. In exchange, he demanded full payment of salary differentials, 13th month
pay, and financial assistance, as promised by his employer. Management promised to pay him as
soon as it is able to pay off all retrenched rank – and – file employees. Five years later, and
before management was able to pay Nicanor the amount promised to him, Nicanor died of a
heart attack. His widow, Norie, filed a money claim against the company before the National
Labor Relations Commission (NLRC), including interest on the amount of the unpaid claim. She
also claimed additional damages arguing that the supposed resignation letter was obtained from
her spouse through undue pressure and influence. The employer filed a motion to dismiss on the
ground that (A) the NLRC did not have jurisdiction over money claims, and (B) the action has
prescribed.
a) Does the NLRC have jurisdiction to award money claims including interest on the amount
unpaid? (2.5%)
b) Assuming that the NLRC has jurisdiction, has the action prescribed? (2.5%)
c) May Nicanor’s spouse successfully claim additional damages as a result of the alleged
undue pressure and influence? (2.5%)

Answer:
a) Yes, the NLRC have jurisdiction to award money claims including interest on the amount unpaid to
Nicanor. The law provides specifically the Labor Arbiter of the NLRC has the jurisdiction over money
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 claims arising out of employer-employee relationship. Here, the claim for full payment of salary
differentials, 13th month pay, and financial assistance arises out of an employer-employee relationship
and therefore, the Labor Arbiter of the NLRC have the jurisdiction to award money claims including
interest on the amount unpaid.

b) No. The action has not yet prescribed. The law provides that the prescriptive period of all money claims
and benefits arising from employer-employee relations is 3 years from the time the cause of action
accrued. The accrual of the cause of action shall be reckoned from the date of demand. Here, the
cause of action has just accrued by the filing of the wife of the money claims with the NLRC. Action is
still within the 3-year period and therefore the action has not yet prescribed.

c) Yes, Nicanor’s spouse will be able to successfully claim the additional damages as a result of the
alleged undue pressure and influence. This is provided under Article 224 (a) 4 of the Labor Code which
provides claims for actual, moral, exemplary, and other forms of damages arising from employer –
employee relationship with the judicial authority of the Arbitration branch of the NLRC. Nicanor’s
spouse can be therefore successfully claim additional damages asserted.

IV
Natasha Shoe Company adopted an organized streamlining program that the resulted in the
retrenchment of 550 employees in its main plant. After having been paid their separation
benefits, the retrenched workers demanded payment of retirement benefits under a CBA
between their union and management. Natasha Show Company denied the worker’s demand.
a. What is the most procedurally peaceful means to resolve this dispute? (2.5%)
b. Can the workers claim both separation pay and retirement benefits?

ANSWER
IV.a

To peacefully resolve the dispute, it may be referred to the grievance machinery provided for under the
CBA.

Under the Labor Code, as amended, a grievance arising from the interpretation and implementation of
the CBA shall be resolved through an established grievance machinery, and if it remains unresolved within
seven (7) days upon submission, it may be referred to voluntary arbitration prescribed in CBA of the parties.
(Article 273, Labor Code)

Here, the dispute between Natasha Shoe Company and the retrenched employees involves a claim by
the latter for payment of the retirement benefits under the CBA. Thus, it is a dispute on the implementation of
the CBA, which is within the grievance machinery’s ambit of jurisdiction to initially resolve. If the dispute
remains unresolved, then the same may be referred to voluntary arbitration.

IV.b

Yes, the workers can claim both separation pay and retirement benefits.

In a case ruled by the Supreme Court (SC), it was held that in the absence of an express or implied
prohibition against it, collection of both retirement benefits and separation pay upon severance from
employment is allowed (Goodyear v. Marina Angus, G.R. No. 185449, November 14, 2014). This is grounded
on the social justice policy that doubts should always be resolved in favor of labor rights (Aquino v. National
Labor Relations Commission, G.R. No. 87653, February 11, 1992).

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 Here, the CBA between the parties did not provide for prohibition against recovery of both separation
pay and retirement benefits. Thus, consistent with the SC’s ruling, the workers can, therefore, be allowed to
collect both.

V
Nelda worked as a chambermaid in Hotel Neverland with a basic wage of PhP560.00 for an
eight-hour workday. On Good Friday, she worked for one (1) hour from 10:00 PM to 11 :00 PM.
Her employer paid her only PhP480.00 for each 8-hour workday, and PhP70.00 for the work done
on Good Friday. She sued for underpayment of wages and non-payment of holiday pay and night
shift differential pay for working on a Good Friday. Hotel Neverland denied the alleged
underpayment, arguing that based on long-standing unwritten tradition, food and lodging costs
were partially shouldered by the employer and partially paid for by the employee through salary
deduction. According to the employer, such valid deduction caused the payment of Nelda's wage
to be below the prescribed minimum.
The hotel also claimed that she was not entitled to holiday pay and night shift differential
pay because hotel workers have to work on holidays and may be assigned to work at night.
(a) Does the hotel have valid legal grounds to deduct food and lodging ~ costs from
Nelda's basic salary? (2.5%)
(b) Applying labor standards law, how much should Nelda be paid for work done on
Good Friday? Show the computation in your test booklet and encircle your final
answer. (2.5%)

a. No. The hotel does not have valid legal grounds to deduct food and lodging costs from Nelda’s basic
salary. Under the Labor Law, as amended, before deducting the value of facilities from the employee’s
wages, employer must observe certain legal requisites: first, proof to be shown that such facilities are
customarily furnished by the trade; second, the provision of the deductible facilities must be voluntarily
accepted in writing by the employee; finally, facilities must be charged at fair and reasonable value.
Here, the value of facilities as part of the wage was not voluntarily accepted in writing by the
employee, hence, there was no valid grounds for the deduction.

b. Nelda should receive Php154 pay for her one (1) hour work from 10:00 PM to 11:00 PM on a Good
Friday. Under the Labor Code, as amended, work rendered on a regular holiday entitles employees
double rate. Under the same Code, every employee is entitled to a Night Differential of Night shift pay
of not less than 10% of his regular wage for each hour of work performed between 10pm and 6am.
Here, Nelda should receive double pay on her work rendered on Good Friday, which is a regular
holiday. Furthermore, she should receive applicable rate for night shift differential pay. The
computation is as follows:
560 daily rate ÷ 8 hours = Php 70 hourly rate
Php 70 x 2 x 1hour = Php140
Night shift differential Pay on a regular holiday:
Php70 x 2 x 10% x 1hour = Php14
Php 140 + Php 14 = Php154
Php 154

VI
A certification election was conducted in Nation Manufacturing Corporation, whereby 55% of the
eligible voters in the bargaining unit cast their votes. The results were as follows:
Union Nana: 45 votes
Union Nada: 40 votes
Union Nara: 30 votes
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No Union: 80 votes

Union Nana moved to be declared as the winner of the certification election.

a) Can Union Nana be declared as the winner? (2.5%)

b) Assume that the eligibility of 30 voters was challenged during the pre-election conference. The
ballots of the 30 challenged voters were placed inside an envelope sealed by the DOLE Election
Officer. Considering the said envelope remains sealed, what should be the next course of action
with respect to the said challenged votes? (2.5%)

ANSWERS:

a. NO. As provided in the Labor Code, to be certified as the sole and exclusive bargaining agent, the union
should obtain majority of the valid votes cast in the certification election.
Here, Union Nana only obtained 45 votes out of the 195 votes cast. As such, it was not able to reach the
required number of votes, which in this case are 97.5 votes. Hence, for failure to obtain the majority of the
valid votes cast, it cannot be declared as the winner of the certification election.

b. As provided in the Omnibus Rules Implementing the Labor Code, the Election Officer shall indicate on the
envelope the voter's name, the union challenging the voter and the ground for the challenge. Then, the sealed
envelope shall be signed by the Election Officer and the representatives of the contending Unions. Thereafter,
the Election Officer shall note all the challengers in the minutes of the election proceedings and shall have
custody of all envelopes containing the challenged votes.

The envelopes shall be opened and the question of eligibility shall be passed upon by the Med-Arbiter only if
the number of the segregated votes will materially alter the results of the election.

VII
Nico is a medical representative engaged in the promotion of Pharmaceutical products and
medical devices for North Pharmaceuticals, Inc. He regularly visits. physicians' clinics to inform
them of the chemical composition and benefits of his employer's products. A the end of everyday,
he receives a basis wage of PhP700.00 plus a PhP150.00 "productivity allowance." For purposes
of computing Nico's 13th month pay, should the daily "productivity allowance" be included?
(2.5%)

ANSWER:

For purposes of computing Nico's 13th month pay his daily "productivity allowance" cannot be included.

In Philippine Spring Water Resources, Inc. v. Court of Appeals, G.R. No. 205278, June 11, 2014, clarified as to
when a commission forms part of basic salary to be considered in the computation of 13th month pay. The
High Court said: It is well-established in jurisprudence that the determination of whether or not a commission
forms part of the basic salary depends upon the circumstances or conditions for its payment. In Phil
Duplicators, Inc. v. NLRC, G.R. No. 110068, November 11, 1993, 227 SCRA 747, the Court held that
commissions earned by salesmen form part of their basic salary. The salesmen’s commissions, comprising a
pre-determined percentage of the selling price of the goods sold by each salesman, were properly included in
the term basic salary for purposes of computing the 13th month pay. The salesmen’s commissions are not
overtime payments, nor profit-sharing payments nor any other fringe benefit, but a portion of the salary
structure which represents an automatic increment to the monetary value initially assigned to each unit of
work rendered by a salesman. On the other hand, in Boie-Takeda Chemicals, Inc. v. De la Serna, G.R. Nos.
92174 and 102552, December 10, 1993, 228 SCRA 329, the so-called commissions paid to or received by
medical representatives were excluded from the term basic salary because these were paid to the medical
representatives and rank-and-file employees as productivity bonuses, which were generally tied to the
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productivity, or capacity for revenue production, of a corporation and such bonuses closely resemble profit-
sharing payments and had no clear direct or necessary relation to the amount of work actually done by each
individual employee.

Applying the above rule, the productivity allowance cannot be included.

VIII
Nathaniel has been a salesman assigned by Newmark Enterprises (Newmark) for nearly two
years at the Manila office of Nutrition City, Inc. (Nutrition City). He was deployed pursuant to a
service agreement between Newmark and Nutrition City, the salient provisions of which were as
follows:
a) the Contractor (Newmark) agrees to perform and provide the Client (Nutrition City), on
a non-exclusive basis, such tasks or activities that are considered contractible under existing
laws, as may be needed by the Client from time to time;
b) the Contractor shall employ the necessary personnel like helpers, salesmen, and drivers
who are determined by the Contractor to be efficiently trained;
c) the Client may request replacement of the Contractor's personnel if quality of the
desired result is not achieved;
d) the Contractor's personnel will comply with the Client's policies, rules, and regulations;
and
e) the Contractor's two service vehicles and necessary equipment will be utilized in
carrying out the provisions of this Agreement.
When Newmark fired Nathaniel, he filed an illegal dismissal case against the wealthier company,
Nutrition City, Inc., alleging that he was a regular employee of the same. Is Nathaniel correct?
(2.5%)

No. The contention of Nathaniel is not correct. Under the law, the elements to determine the existence
of an employment relationship are:
1. Selection and engagement of the employee
2. Payment of wages
3. Power of dismissal
4. Employer’s power fo control the employee’s conduct.
The most important element is the employer’s control of the employee’s conduct, not only as to the
result of the work to be done, but also to the means and methods to accomplish it.
Likewise, jurisprudence states that in determining whether a person who performs work for another is
the latter's employee or an independent contractor, the prevailing test is the right of control test.
Here, Nutrition City Inc do not exercise control over Nathaniel. The former do not control the means
and methods to accomplish the work to be done.
Therefore, Nathaniel’s contention is not correct because he is not an employee of Nutrition.

IX
Sgt. Nemesis was a detachment non-commissioned officer of the Armed Forces of the
Philippines in Nueva Ecija. He and some other members of his detachment sought permission
from their Company Commander for an overnight pass to Nueva Vizcaya to settle some important
matters. The Company Commander orally approved their request and allowed them to carry their
firearms as the place they were going to was classified as a “critical place.” They arrived at the
place past midnight; and as they were alighting from a tricycle, one of his companions
accidentally dropped his rifle, which fired a single shot, and in the process hit Sgt. Nemesis
fatally. The shooting was purely accidental. At the time of his death, he was still legally married
to Nelda, but had been separated de facto from her for 17 years. For the last 15 years of his life,
he was living in with Narda, with whom he has two minor children. Since Narda works as a
kasambahay, the two children lived with their grandparents, who provided their daily support.
Sgt. Nemesis and Narda only sent money to them every year to pay for their school tuition.
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 Nelda and Narda, both for themselves and the latter, also on behalf of her minor children,
separately filed claims for compensation as a result of the death of Sgt. Nemesis. The Line of
Duty Board of the AFP declared Sgt. Nemesis’s death to have been “in life of duty,” and
recommended that all benefits due to Sgt. Nemesis be given to his dependents. However, the
claims were denied by GSIS because Sgt. Nemesis was not in his workplace nor performing his
duty as a soldier of the Philippine Army when he died.

(a) Are the dependents of Sgt. Nemesis entitled to compensation as a result of his
death? (2.5%)
(b) As between Nelda and Narda, who should be entitled to the benefits? (2.5%)
(c) Are the minor children entitled to the benefits considering that they were not fully
dependent on Sgt. Nemesis for support? (2.5%)

Suggested Answers:

(a)

The death of Sgt. Nemesis is compensable because it is work-related. For the compensability of an
injury to an employee which results in his disability or death, Section 1(a), Rule III of the Amended Rules on
Employee’s Compensation imposes the following conditions:
1. The employee must have been injured at the place where his work
required him to be;
2. The employee must have been performing his official functions; and
3. In the injury was sustained elsewhere, the employee must have been executing an order of the
employer.

It is important to note, that the requirement that the injury must arise out of and in the course of
employment proceeds from the limiting premise that the injury must be the result of an accident (Government
Service Insurance System vs. Jum Angel, 20 July 2011).
In an analogous case, the Supreme Court grant the death compensation benefits to Hinoguin stating
that the place which soldiers have secured lawful permission to be at cannot be very different, legally
speaking, from a place where they are required to go by their commanding officer. They were not on vacation
leave and they are required or authorized to carry their firearms to defend themselves (Ciracio Hinoguin vs.
Employees Compensation Commission, 17 April 1989).
Ergo, since the death of Sgt. Nemesis is in line with his duties, his dependents are entitled to
compensation as a result of his death.

(b)

Neither Nelda nor Narda is entitled to the benefits.

The law requires that the dependent spouse should be a legitimate spouse living with the employee. In
the case at hand, the legitimate spouse Nelda is not entitled because she is not living with Sgt. Nemesis. On
the other hand, Narda is likewise not qualified as dependent spouse as she is not a legitimate spouse of Sgt.
Nemesis.

(c)

The minor children are entitled to the death compensation benefits.

In so far as the dependent child is concern, the law requires that the dependent child be legitimate,
legitimated, or legally adopted, unmarried, not gainfully employed, thus, unable to support himself. From the
foregoing, the children met the qualifications required by law and as such entitled to the benefits.

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 X
Nonato had been continuously employed and deployed as a seaman who performed
services that were necessary and desirable to the business of N-Train shipping, through its local
agent, Narita Maritime Services (Agency), in accordance with the 2010 Philippine Overseas
Employment Administration Standard Employment Contract (2010 POEA-SEC). Nonato's last
contract (for five months) expired on November 15, 2016. Nonato was then repatriated due to
"finished contract." He immediately reported to the Agency and complained that he had been
experiencing dizziness, weakness, and difficulty in breathing. The agency referred him to Dr.
Neri, who examined, treated, and prescribed him with medications. After a few months of
treatment and consultations, Nonato was declared fit to resume work as a seaman. Nonato went
back to the Agency to ask for re-deployment but the Agency rejected his application. Nonato filed
an illegal dismissal case against the Agency and its principal, with a claim for total disability
benefits based on the ailments that he developed on board N-Train Shipping vessels. The claim
was based on the certification of his own physician, Dr. Nunez, that he was unfit for sea duties
because of his hypertension and diabetes.

a) Was Nonato a regular employee of N-Train Shipping? (2.5%)

SUGGESTED ANSWER:

No, Nonato was not a regular employee of N-Train Shipping.

The fact that seafarers are not regular employees is already a settled rule.
In Petroleum Shipping Limited (formerly Esso International Shipping (Bahamas) Co., Ltd.) v. NLRC,
G.R. No. 148130, June 16,2006, the Supreme Court said that the issue on whether seafarers are
regular employees is already a settled matter. Thus, the High Court said: “It was in Ravago v. Esso
Eastern Marine, Ltd., G.R. No. 158324, 14 March 2005, 453 SCRA 381 where the Honorable Supreme
Court traced its ruling in a number of cases that seafarers are contractual, not regular, employees.
Thus, in Brent School, Inc. v. Zamora, G.R. No. 48494, 5 February 1990, 181 SCRA 702 the Supreme
Court cited overseas employment contract as an example of contracts where the concept of regular
employment does not apply, whatever the nature of the engagement and despite the provisions of
Article 280 of the Labor Code.”

In Coyoca v. NLRC, G.R. No. 113658 March 31, 1995, the Supreme Court held that the agency
is liable for payment of a seaman’s medical and disability benefits in the event that the principal fails or
refuses to pay the benefits or wages due the seaman although the seaman may not be a regular
employee of the agency.

The Supreme Court squarely passed upon the issue in Millares v. NLRC, G.R. No. 110524, July
29, 2002, where one of the issues raised was whether seafarers are regular or contractual employees
whose employments are terminated every time their contracts of employment expire. The Supreme
Court explained:

It is clear that seafarers are considered contractual employees. They cannot be

considered as regular employees under Article 280 of the Labor Code. Their
employment is governed by the contracts they sign everytime they are rehired and
their employment is terminated when the contract expires. Their employment is
contractually fixed for a certain period of time. They fall under the exception of Article
280 whose employment has been fixed for a specific project or undertaking the
completion or termination of which has been determined at the time of engagement of
the employee or where the work or services to be performed is seasonal in nature and
the employment is for the duration of the season.
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b) Can Nonato successfully claim disability benefits against N-Train Shipping and its agent Narita
Maritime Services? (2.5%)

SUGGESTED ANSWER:

No, the claim for disability benefits of Nonato against N-Train Shipping and its agent Narita
Maritime Services will not prosper for prematurity.

The Supreme Court laid down the procedures for filing disability benefits and its effect in case
of failure to comply with it in Daraug v. KGJS Fleet Management Manila, G.R. No. 211211, January 14,
2015. In Vergara v. Hammonia Maritime Services, Inc.31 (Vergara), it was stated that the Department
of Labor and Employment (DOLE), through the POEA, has simplified the determination of liability for
work-related death, illness or injury in the case of Filipino seamen working on foreign oceangoing
vessels. Every seaman and the vessel owner (directly or represented by a local manning agency) are
required to execute the POEA Standard Employment Contract (POEA-SEC) as a condition sine qua non
prior to the deployment of the seaman for overseas work. The POEA-SEC is supplemented by the
Collective Bargaining Agreement (CBA) between the owner of the vessel and the covered seaman. In
this case, the parties entered into a contract of employment in accordance with the POEA-SEC and they
agreed to be bound by the CBA.

Thus, in resolving petitioner’s claim for disability compensation, the Court will be guided by the
procedures laid down in the POEA-SEC and in the CBA. On this point, Section 20(B)(3) of the POEA-
SEC provides:

Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness
allowance equivalent to his basic wage until he is declared fit to work or the degree of
permanent disability has been assessed by the company-designated physician but in no
case shall this period exceed one hundred twenty (120) days.
For this purpose, the seafarer shall submit himself to a post-employment medical
examination by a company-designated physician within three working days upon his
return except when he is physically incapacitated to so, in which case, a written notice
to the agency within the same period is deemed a compliance. Failure of the seafarer
to comply with the mandatory reporting requirement shall result in his forfeiture of the
right to claim the above benefits.
If a doctor appointed by the seafarer disagrees with the assessment, a third doctor
may be agreed jointly between the Employer and the seafarer. The third doctor’s
decision shall be final and binding on both parties.

XI
Your favorite relative, Tita Nilda, approaches you and seeks your advice on her treatment of her
kasambahay, Noray. Tita Nilda shows you a document called a "Contract of Engagement" for your
review. Under the Contract of Engagement, Noray shall be entitled to a rest day every week,
provided that she may be requested to work on a rest day if Tita Nilda should need her services
that day. Tita Nilda also claims that this Contract of Engagement should embody all terms and
conditions of Noray's work as the engagement of a kasambahay is a private matter and should
not be regulated by the State.

a) Is Tita Nilda correct in saying that this is a private matter and should not be regulated by the
State? (2.5%)

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b) Is the stipulation that she may be requested to work on a rest day legal? (2.5%)

c) Are stay-in family drivers included under the Kasambahay Law? (2.5%)

SUGGESTED ANSWER

a.) No, Tita Nilda is not correct in saying that engagement of a kasambahay is a private matter and should not
be regulated by the State. This is a valid subject matter of the exercise of police power to give effect to the
declared policy of the law such as the need to protect the rights of domestic workers against abuse,
harassment, violence, economic exploitation and performance of work that is hazardous to their physical and
mental health; and in protecting domestic workers and recognizing their special needs to ensure safe and
healthful working conditions, promotes gender-sensitive measures in the formulation and implementation of
policies and programs affecting the local domestic work. (Section 2, Article I, Republic Act No. 10361)

b.) Yes, the stipulation that Noray may be requested to work on a rest day is legal. The law provides that, “
Nothing in this provision shall deprive the domestic worker and the employer from agreeing to the following:
(a) Offsetting a day of absence with a particular rest day; (b) Waiving a particular rest day in return for an
equivalent daily rate of pay; (c) Accumulating rest days not exceeding five (5) days; or (d) Other similar
arrangements. (Section 21, Article IV, Republic Act No. 10361)

c.) No, stay-in family drivers are not included under the Kasambahay Law. This was very clear in the Rules
Implementing the Kasambahay Law providing as follows: The following are not covered: (a) Service providers;
(b) Family drivers; (c) Children under foster family arrangement; and (d) Any other person who performs work
occasionally or sporadically and not on an occupational basis. (Section 2, Rule I, IRR of RA 10361)

XII
Nena worked as an Executive Assistant for Nesting, CEO of Nordic Corporation. One day, Nesting
called Nena into his office and showed her lewd pictures of women in seductive poses which
Nena found offensive. Nena complained before the General Manager who, in turn, investigated
the matter and recommended the dismissal of Nesting to the Board of Directors. Before the
Board of Directors, Nesting argued, that since the Anti-Sexual Harassment Law requires the
existence of "sexual favors," he should not be dismissed from the service since he did not ask for
any sexual favor from Nena. Is Nesting correct? (2.5%)

ANSWER

No, Nesting is not correct.

Section 3 of the Republic Act 7877 or the Anti-Sexual Harassment Act of 1995 sets the parameters on
who can be charged with work or training-related sexual harassment and how such a crime is committed.

“Work, education or training-related sexual harassment is committed by an employer, employee,

manager, supervisor, agent of the employer, teacher, instructor, professor, coach, trainor, or any
other person who, having authority, influence or moral ascendancy over another in a work or training
or education environment, demands, requests or otherwise requires any sexual favor from the other,
regardless of whether the demand, request or requirement for submission is accepted by the object of
said Act.”

In a landmark case (Domingo vs Rayala), the Supreme Court ruled out that it is true that this provision
calls for a "demand, request or requirement of a sexual favor." But it is not necessary that the demand,
request or requirement of a sexual favor be articulated in a categorical oral or written statement. It may be
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discerned, with equal certitude, from the acts of the offender. Holding and squeezing the shoulders, running
his fingers across her neck and tickling her ear, having inappropriate conversations with her, giving her money
allegedly for school expenses with a promise of future privileges, and making statements with unmistakable
sexual overtones — all these acts resound with deafening clarity the unspoken request for a sexual favor.

Likewise, it is not essential that the demand, request or requirement be made as a condition for
continued employment or for promotion to a higher position. It is enough that the respondent's acts result in
creating an intimidating, hostile or offensive environment for the employee.

Here, even if no sexual favor was asked by Nesting, but the fact that he showed lewd pictures of
women in seductive poses to Nena, it already resulted to an intimidating, hostile or offensive environment for
Nena. As such, Nesting already violated the Anti-Sexual Harassment Act and may be subject to dismissal.

Thus, Nesting is not correct.

XIII
Nicodemus was employed as a computer programmer by Network Corportion, a
telecommunications firm. He has been coming to work in shorts and sneakers, in violation of the
“prescribed uniform policy” based on company rules and regulations. The company human
resource manager wrote him a letter, giving him 10 days to comply with the company uniform
policy. Nicodemus asserted that wearing shorts and sneakers made him productive, and cited his
above-average output. When he came to work still in violation of the uniform policy, the
company sent him a letter of termination of employment. Nicodemus filed an illegal dismissal
case. The Labor Arbiter ruled in favor of Nicodemus and ordered his reinstatement with
backwages. Network Corportion, however, refused to reinstate him. The NLRC 1st division
sustained the Labor Arbiter’s judgment. Network Corporation still refused to instate Nicodemus.
Eventually, the Court of Appeals reversed the decision of the NLRC and ruled that the dismissal
was valid. Despite the reversal, Nicodemus still filed a motion for execution with respect to his
accrued backwages.

(a) Were there valid grounds to dismiss Nicodemus from his employment? (2.5%)

(b) Should Nicodemus’ motion for execution be granted? (2.5%)

Answers:

(a) No. Nicodemus’ termination by employer is not valid. Under the Labor Code, there are only two (2)
instances wherein an employee may be dismissed from employment. There are just and authorized causes.
The former includes 1) serious misconduct or willful disobedience by the employee of the lawful orders of
his employer or representative in conncection with his work, 2) gross and habitual neglect by the employee
of his duty, 3) Fraud or willfull breach by the employee of the trust reposed in 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 representatives; and 4) other
causes analogous to the foregoing. The latter includes installation of labor-saving devices, redundancy,
retrenchment, closure or cessation of business operations or disease. In this case, Nicodemus’ mere
disobedience to the company rules pertaining to uniform policy cannot be considered as a valid ground to
dismiss him from employment.

(b) No. Nicodemus’ motion for execution should not be granted. Under the law, an employee is only entitled to
award of backwages when the judgment is already final and executory. In this case, even if the Court of
Appeals reversed the decision of the NLRC, Nicodemus is not left without a remedy. His case is still appealable
to the Supreme Court. Hence, his motion for execution cannot be granted.

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 XIV
Nelson complained before the DOLE Regional Office about Needy Corporation's failure to
pay his wage increase amounting to PhP5,000.00 as mandated in a Wage Order issued by the
Regional Tripartite Wages and Productivity Board. Consequently, Nelson-asked the DOLE to
immediately issue an Order sustaining his money claim. To his surprise, he received a notice from
the DOLE to appear before the Regional Director for purposes of conciliating the dispute between
him and Needy Corporation. When conciliation before the Regional Director the latter proceeded
to direct both parties to submit their respective position papers in relation to the dispute. Needy
Corporation argued, that since Nelson was willing to settle for 75% of his money claim during
conciliation proceedings, only a maximum of 75% of the said money claim may be awarded to
him.

(a) Was DOLE’s action to conduct mandatory conciliation in light of Nelson’s complaint
valid? (2.5%)
(b) Should the Regional Director sustain Needy Corporation’s argument? (2.5%)

SUGGESTED ANSWER:
(a) Yes, the DOLE’s action to conduct mandatory conciliation is valid. This is mandated by Article 234 of
the Labor Code, except as provided in Title VII-A, Book V of the Labor Code, as amended, or as may be
excepted by the Secretary of Labor and Employment, all issues arising from labor and employment shall be
subject to mandatory conciliation-mediation.

(b) The Regional Director should not sustain Needy Corporation’s argument. This is because under
Article 239 of the Labor Code, information and statements made at conciliation proceedings shall be treated as
privileged communication and shall not be used as evidence in the Commission. Conciliators and similar
officials shall not testify in any court or body regarding any matters taken up at conciliation proceedings
conducted by them. Thus, Needy Corporation cannot raise the argument that Nelson was willing to settle for
75% of his money claim during conciliation proceedings.

XV
Nextum Corporation employed Nini and Nono, whose tasks involved directing and supervising
rank-and-file employees engaged in company operations. Nini and Nono are required to ensure
that such employees obey company rules and regulations, and recommend to the company’s
Human Resources Department any required disciplinary action against erring employees. In
Nexturn Corporation, there are two independent unions, representing rank-and-file and
supervisory employees, respectively.

a) May Nini and Nono join a union? (2.5%)

b) May the two unions be affiliated with the same Union Federation? (2.5%)

ANSWER

a) Yes, Nini and Nono may join a union.

Article 219 [212] of the Labor Code, as amended, provides that supervisory employees are those who, in the
interest of the employer, effectively recommend such managerial actions if the exercise of such authority is
not merely routinary or clerical in nature but requires the use of independent judgment; while Article 255
[245] of the Labor Code, as amended, provides that supervisory employees shall not be eligible for
membership in the collective bargaining unit of the rank-and-file employees but may join, assist or form
separate collective bargaining units and/or legitimate labor organizations of their own.

As Nini and Nono’s tasks involve supervising rank-and-file employees engaged in company operations and
recommending to the company any required disciplinary action against erring employees, they are supervisory
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employees within the meaning of the term per the Labor Code. As such, they are eligible to join a separate
collective bargaining unit and/or legitimate labor organization of their own; that is, one that is solely for
supervisors, different and apart from that composed of rank-and-file employees.

b) Yes, the two unions may be affiliated with the same Union Federation.

Article 255 [245] of the Labor Code, as amended, provides that the rank and file union and the supervisors'
union operating within the same establishment may join the same federation or national union.

Hence, the two unions in Nexturn Corporation, that representing the rank-and-file and that of the supervisory
employees, may be affiliated with the same Union Federation.

XVI
Nagrab Union and Nagrab Corporation have an existing CBA which contains the following
provision: “New employees within the coverage of the bargaining unit who may be regularly
employed shall become members of Nagrab Union. Membership in good standing with the
Nagrab Union is a requirement for continued employment with Nagrab Corporation.” Nagrab
Corporation subsequently acquired all the assets and rights of Nuber Corporation and absorbed
all of the latter’s employees. Nagrab Union immediately demanded enforcement of the above-
stated CBA provision with respect to the absorbed employees. Nagrab Corporation refused on the
ground that this should not apply to the absorbed employees who were former employees of
another corporation whose assets and rights it had acquired.

a) Was Nagrab Corporation correct in refusing to enforce the CBA provision with respect
to the absorbed employees? (2.5%)

b) May a newly-regularized employee of Nagrab Corporation (who is not part of the

absorbed employees) refuse to join Nagrab Union? How would you advise the human
resources manager of Nagrab Corporation to proceed?

SUGGESTED ANSWERS:

a) Nagrab Corporation is not correct.

In the case of Bank of the Philippine Islands vs. BPI Employees Union—Davao Chapter, the Supreme
Court held that the position of BPI that the term “new employees” in the Union Shop Clause of the CBA is
qualified by the phrases “who may be regularly employed” means only those employees who were new to BPI,
on account of having been hired initially on a temporary or probationary status for possible regular
employment at some future date, does not have merit. The Supreme Court ruled that there are no substantial
differences between a newly hired non-regular employee who was regularized weeks or months after his hiring
and a new employee who was absorbed from another bank as a regular employee pursuant to a merger, for
purposes of applying the Union Shop Clause.

In the instant case, the provision of the CBA states: “New employees within the coverage of the
bargaining unit who may be regularly employed shall become members of Nagrab Union. Membership in good
standing with the Nagrab Union is a requirement for continued employment with Nagrab Corporation.”
Following the ruling of the Supreme Court, since the provision does not distinguish between a newly-hired
non-regular employee subsequently regularized and a new employee who was absorbed from another bank,
then the CBA provision requiring union membership should apply.

b) A newly-regularized employee of Nagrab Corporation may not refuse to join the Union.

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 The said provision in a CBA is called a Union Shop Clause which was declared by the Supreme Court
as valid and constitutional. A union shop clause requires all new regular employees are required to join the
union within a certain period for their continued employment. The rationale for upholding the validity of union
shop clauses in a CBA, even if they impinge upon the individual employee’s right or freedom of association, is
not to protect the union for the union’s sake. Laws and jurisprudence promote unionism and afford certain
protections to the certified bargaining agent in a unionized company because a strong and effective union
presumably benefits all employees in the bargaining unit since such a union would be in a better position to
demand improved benefits and conditions of work from the employer. This is the rationale behind the State
policy to promote unionism declared in the Constitution.

In this regard, I would advise the human resources manager to properly appraise the said employee
of the nature and consequences of the union shop clause in the CBA in force in Nagrab Corporation. Since the
said employee’s regularization shall subject her to the union shop clause of the CBA, her non-membership to
the union will result in the termination of her employment.

XVII
Upon compliance with the legal requirements on the conduct of a strike, Navarra Union staged a
strike against Newfound Corporation on account of a collective bargaining deadlock. During the
strike, some members of Navarra Union broke the windows and punctured the tires of the
company-owned buses. he Secretary of Labor and Employment assumed jurisdiction over the
dispute.

(a) Should all striking employees be admitted back to work upon the assumption of jurisdiction
by the Secretary of Labor and Employment? Will these include striking employees who damaged
company properties? (2.5%)

ANSWER:

All striking employees be admitted back to work and including striking employees who damaged company
properties. The effect of assumption of jurisdiction of the Secretary of Labor is clear under Article 278 (g)
which provides in substance that such assumption shall have the effect of automatically enjoining the intended
or impending strike or lockout as specified in the assumption or certification order. If one has already taken
place at the time of assumption or certification, all striking or locked out employees shall immediately return-
to-work and the employer shall immediately resume operations and readmit all workers under the same terms
and conditions prevailing before the strike or lockout.

(b) May the company, readmit strikers only by restoring them to the payroll? 5%)

SUGGESTED ANSWER:

The company may not readmit strikers by restoring them to the payroll. The phrase “under the same terms
and conditions” found in Article 278 (g) [263 (g)] of the Labor Code was interpreted by the Supreme Court in
the case of the University of Immaculate Concepcion, Inc. v. Secretary of Labor, G.R. No. 151379, January 14,
2005 as follows:
With respect to the Secretary’s Order allowing payroll reinstatement instead of actual reinstatement for the
individual respondents herein, an amendment to the previous Orders issued by her office, the same is usually
not allowed. Article 263(g) of the Labor Code aforementioned states that all workers must immediately return
to work and all employers must readmit all of them under the same terms and conditions prevailing before the
strike or lockout. The phrase “under the same terms and conditions” makes it clear that the norm is actual
reinstatement. This is consistent with the idea that any work stoppage or slowdown in that particular industry
can be detrimental to the national interest.

Clearly, reinstatement should be actual and not payroll reinstatement.

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 XVIII
Nestor and Nadine have been living in for the last 10 years without the benefit of marriage. Their
union has produced four children. Nadine was three months pregnant with her 5th child when
Nestor left her for another woman. When Nadine was eight months pregnant with her 5th child,
she applied for maternity leave benefits. Her employer refused on the ground that this was
already her 5th pregnancy and that she was only living in with the father of her child, who is now
in a relationship with another woman. When Nadine gave birth, Nestor applied for paternity
leave benefits. His employer also denied the application on the same grounds that Nadine's
employer denied her application.
(a) Can Nadine's employer legally deny her claim for maternity benefits? (2.5%)

(b) Can Nestor's employer legally deny his claim for paternity benefits? (2.5%)

a)Yes, Nadine's employer legally deny her claim for maternity benefits.
Under the Social Security Act of 1997, the maternity benefit shall be paid only for the first four (4)
deliveries or miscarriages.
Here, Nadine was three months pregnant with her 5th child. Therefore, the refusal of her employer to
grant the maternity benefit on the ground that this was already her 5th pregnancy is correct.

b) Yes, under RA 8187 or also known as The Paternity Leave Act of 1996, it provides that, a father
shall be entitled to a leave of not more than 7 calendar days if he meets the following requisites among
others;
1. He has to be legally married to his wife;
2. He and his wife are living under one roof;
3. His wife is giving birth or had suffered a miscarriage;
4. He and his wife are welcoming their first, second, third, or fourth child, or his wife has not had a
miscarriage more than four times.
Here, Nestor is not legally married to Nadine as they had only been living together without the benefit
of marriage nor he lives under the same roof with Nadine for he has left the latter for another woman and the
law explicitly says that they need to be cohabitating to avail of the benefit. That although Nadine is about to
give birth, they are already welcoming their fifth child which is beyond the limit provided for by law.
Since none of the aforementioned conditions was met by Nestor, thus, his employer can legally deny
his claim for paternity benefits.

XIX
Northeast Airlines sent notices of transfer, without diminution in salary or rank, to 50 ground
crew personnel who were front-liners at Northeast Airlines counters at the Ninoy Aquino
International Airport (NAIA). The 50 employees were informed that they would be distributed to
various airports in Mindanao to anticipate robust passenger volume growth in the area. North
Union, representing rank-and-file employees, filed unfair labor practice and illegal dismissal
cases before the NLRC, citing, among others, the inconvenience of the 50 concerned employees
and union discrimination, as 8 of the 50 concerned ground crew personnel were union officers.
Also, the Union argued that
Northeast Airlines could easily hire additional employees from Mindanao to boost & its ground
operations in the Mindanao airports.

a) Will the transfer of the 50 ground crew personnel amount to illegal dismissal? (2.5%)

b) Will the unfair labor practice case prosper? (2.5%)

ANSWERS

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 a. No, the transfer does not amount to illegal dismissal.

Under the doctrine of management prerogative, every employer has the inherent right to regulate,
according to his own discretion and judgment, all aspects of employment, including hiring, work assignments,
working methods, the time, place and manner of work, work supervision, transfer of employees, lay-off of
workers, and discipline, dismissal, and recall of employees. The only limitations to the exercise of this
prerogative are those imposed by labor laws and the principles of equity and substantial justice.

The transfer was made pursuant to a valid exercise of the airline company’s prerogative to transfer or
reassign its employees for valid reasons and in accordance with the requirements of its business.

Since the transfer was not attended by malice or bad faith, as it was shown to be necessary to boost
its ground operations in Mindanao, and was done without diminution in rank, salary and benefits, there could
be no cause of action for illegal dismissal.

b. No, the case of unfair labor practice will not prosper.

The mere transfer of its members cannot paralyze the union. The union was not deprived of the
membership of the employees whose work assignments were only transferred to another location.

Moreover, there was no showing or any indication that the transfer orders were motivated by an
intention to interfere with the employees’ right to organize. Unfair labor practice refers to acts that violate the
workers' right to organize. With the exception of Article 248 (f) of the Labor Code of the Philippines, the
prohibited acts are related to the workers' right to self-organization and to the observance of a CBA. Without
that element, the acts, no matter how unfair, are not unfair labor practices.

Moreover, the airline company cannot just hire new employees to boost its ground operations in Mindanao
since this will entail additional costs or expenses; it would have to train the new hires and would be impractical
and entails more expenses on the part of Northeast Airlines.

Thus, the case of unfair labor practice will not prosper

XX
In Northern Lights Corporation, union members Nad, Ned and Nod sought permission from the
company to distribute flyers with respect to a weekend union activity. The company HR manager
granted the request through a text message sent to another union member, Norlyn. While Nad,
Ned, and Nod re distributing the flyers at the company assembly plant, a Company supervisor
barged in and demanded that they cease from distributing the flyers, stating that the assembly
line employees were trying to beat a production deadline and were thoroughly distracted. Norlyn
tried to show the HR manager's text message authorizing flyer distribution during work hours,
but the supervisor brushed it aside. As a result, Nad, Ned, and Nod were suspended for violating
company rules on trespass and highly-limited union activities during work hours. The Union filed
an unfair labor practice (ULP) case before the NLRC for union discrimination.

a) Will the ULP case filed by the Union prosper? (2.5%)

No. The ULP case filed by the Union will not prosper. This is because the act did not constitute an act of
interfering, restraining or coercing the said employees in the exercise of their right to self-organization under
Article 259 [a] of the Labor Code.

In T & T Shoplifters Corporation/Gin Queen Corporation v. T&T Shoplifters Corporation/Gin Queen Corporation
Workers Union, G.R. No. 191714, February 26, 2014 citing the case of Insular Life Assurance Co., Ltd.
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Employees Association – NATU v. Insular Life Assurance Co., Ltd., (147 Phil. 194 [1971]) the Supreme Court
had occasion to lay down the test of whether an employer has interfered with and coerced employees in the
exercise of their right to self-organization, that is, whether the employer has engaged in conduct which, it may
reasonably be said, tends to interfere with the free exercise of employees’ rights; and that it is not necessary
that there be direct evidence that any employee was in fact intimidated or coerced by statements of threats of
the employer if there is a reasonable inference that anti-union conduct of the employer does have an adverse
effect on self-organization and collective bargaining.

In the given facts, it does not show that the act of the company supervisor in barging in and demanding for
Nad, Ned, and Nod to cease from distributing the flyers relates to the commission of acts that transgress their
right to organize or it was made to interfere, restrain or coerce them with the exercise of their right to self-
organization.

b) Assume the NLRC ruled in favor of the Union. The Labor Arbiter's judgment included, among
others, an award for moral and exemplary damages at PhP50,000.00 each for Nad, Ned, and Nod.
Northern Lights Corporation argued that any award of damages should be given to the Union and
not individually to its members. Is Northern Lights Corporation correct? (2.5%)

No. Northern Lights Corporation is not correct. The rights that were violated belongs to the union members,
Nad, Ned, and Nod, and not the union itself. Further, the said union members were the real party in interest
in the said case for ULP filed by the union against the corporation and not the union itself. The union is a
juridical person and as a rule it cannot not suffer moral damages.

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