Labor Standards – Atty. V.
Duano
New Era University College of Law
Article 4
Art. 4, LC v. Art. 1702, Civil Code
Article 4, Labor Code Art. 1702, CC
Both refers to the interpretation when there is doubt
With respect to Labor Code With respect to other labor
and its Implementing Rules legislations and contracts
and Regulations (hence, other laws other
than the LC)
Purely on provisions of the
CBA
FAQ: What is the concept of liberal interpretation of labor
laws?
Article 6 – applicability
Article 6. Applicability. All rights and benefits granted to workers
under this Code shall, except as may otherwise be provided herein,
apply alike to all workers, whether agricultural or non-agricultural.
(As amended by Presidential Decree No. 570-A, November 1, 1974)
Relate/compare with Article 82:
Article 82. Coverage. The provisions of this Title shall apply to
employees in all establishments and undertakings whether for profit
or not, but not to government employees, managerial employees,
field personnel, members of the family of the employer who are
dependent on him for support, domestic helpers, persons in the
personal service of another, and workers who are paid by results as
determined by the Secretary of Labor in appropriate regulations.
As used herein, "managerial employees" refer to those whose
primary duty consists of the management of the establishment in
which they are employed or of a department or subdivision thereof,
and to other officers or members of the managerial staff.
"Field personnel" shall refer to non-agricultural employees who
regularly perform their duties away from the principal place of
business or branch office of the employer and whose actual hours of
work in the field cannot be determined with reasonable certainty.
Article 13 (3) – essential features, policy on employment,
working conditions, co-determination, labor and &
enterprise (Constitution)
SECTION 3. The State shall afford full protection to labor, local and
overseas, organized and unorganized, and promote full employment
and equality of employment opportunities for all.
It shall guarantee the rights of all workers to self-organization,
collective bargaining and negotiations, and peaceful concerted
activities, including the right to strike in accordance with law. They
shall be entitled to security of tenure, humane conditions of work,
and a living wage. They shall also participate in policy and decision-
making processes affecting their rights and benefits as may be
provided by law.
The State shall promote the principle of shared responsibility
between workers and employers and the preferential use of
voluntary modes in settling disputes, including conciliation, and
shall enforce their mutual compliance therewith to foster industrial
peace.
The State shall regulate the relations between workers and
employers, recognizing the right of labor to its just share in the fruits
of production and the right of enterprises to reasonable returns on
investments, and to expansion and growth.
Article 1700, Civil Code
Article 1700. The relations between capital and labor are not merely
contractual. They are so impressed with public interest that labor
contracts must yield to the common good. Therefore, such contracts
are subject to the special laws on labor unions, collective bargaining,
strikes and lockouts, closed shop, wages, working conditions, hours
of labor and similar subjects.
- This means that the relationship of employer and
employee is also with public interest
- Because their relationship is not just contractual
Principle of co-determination
Sentence 3, Par.2, Article 13, Constitution
They shall also participate in policy and decision-making
processes affecting their rights and benefits as may be
provided by law.
Relate with:
Art. 218 (g), LC
To enjoin or restrain any actual or threatened commission of any or
all prohibited or unlawful acts or to require the performance of a
particular act in any labor dispute which, if not restrained or
performed forthwith, may cause grave or irreparable damage to any
party or render ineffectual any decision in favor of such party:
Provided, That no temporary or permanent injunction in any case
involving or growing out of a labor dispute as defined in this Code
shall be issued except after hearing the testimony of witnesses, with
opportunity for cross-examination, in support of the allegations of a
complaint made under oath, and testimony in opposition thereto, if
offered, and only after a finding of fact by the Commission, to the
effect:
Art. 277 (h), LC
In establishments where no legitimate labor organization exists,
labor-management committees may be formed voluntarily by
workers and employers for the purpose of promoting industrial
peace. The Department of Labor and Employment shall endeavor to
enlighten and educate the workers and employers on their rights and
responsibilities through labor education with emphasis on the policy
thrusts of this Code. (As amended by Section 33, Republic Act No.
6715, March 21, 1989)
Art. 292 (h), LC
(h) In establishments where no legitimate labor organization exists,
labor-management committees may be formed voluntarily by
workers and employers for the purpose of promoting industrial
peace. The Department of Labor and Employment shall endeavor to
enlighten and educate the workers and employees on their rights and
responsibilities through labor education with emphasis on the policy
thrust of this Code. (As amended by RA 6715)
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Labor Standards – Atty. V. Duano
New Era University College of Law
*read PAL v. NLRC
PAL v. NLRC
Can the principle of co-determination be invoked?
Qualification: management prerogative (business aspect) v.
rights and benefits of workers
If the issue is connected with security of tenure and not purely
business aspect, and when the employees will be deprived of
their right to property (work), then the principle can be
invoked.
Relate with Article 219 (m) [def of mgt prerogative]
(m) "Managerial employee" is one who is vested with powers or
prerogatives to lay down and execute management policies and/or to
hire, transfer, suspend, lay-off, recall, discharge, assign or discipline
employees. 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. All employees not
falling within any of the above definitions are considered rank-and-
file employees for purposes of this Book.
Test of Management prerogative/ceiterion given in the
jurisprudence; Bona Fide Occupational Qualification
(BFOQ)
*see Duncan v. Glaxo
* see Star Paper v. Timbol
*Always remember that the test is if the policy is in relation
to management necessity, the employment qualification (ex.
As to age, civil status) is reasonable = this is the BFOQ
Connect with:
Article 134, LC
Article 134. Stipulation against marriage. It shall be unlawful for an
employer to require as a condition of employment or continuation of
employment that a woman employee shall not get married, or to
stipulate expressly or tacitly that upon getting married a woman
employee shall be deemed resigned or separated or to actually
dismiss, discharge, discriminate or otherwise prejudice a woman
employee merely by reason of her marriage.
Art. 133, LC
Article 133. Discrimination prohibited. It shall be unlawful for any
employer to discriminate against any woman employee with respect
to terms and conditions of employment solely on account of her sex.
The following are acts of discrimination:
(a) Payment of a lesser compensation, including wage, salary or
other form of remuneration and fringe benefits, to a female
employee as against a male employee, for work of equal value; and
(b) Favoring a male employee over a female employee with respect
to promotion, training opportunities, study and scholarship grant
solely on account of their sexes.
Article 135, LC
Article 135. Prohibited acts. (a) It shall be unlawful for any
employer:
(1) To deny any woman employee the benefits provided for in this
Chapter or to discharge any woman employed by him for the
purpose of preventing her from enjoying any of the benefits provided
under this Code;
(2) To discharge such woman on account of her pregnancy, while on
leave or in confinement due to her pregnancy; or
(3) To discharge or refuse the admission of such woman upon
returning to her work for fear that she may again be pregnant.
AND RELATE WITH ARTICLE 158, last par. (provision on
women night workers):
“The provisions of this article shall not have the effect of reducing
the protection and benefits connected with maternity leave under
existing laws.”
EMPLOYER-EMPLOYEE RELATIONSHIP
Always remember the four-fold test:
The four-fold test in determining the existence of employee-
employer relationship:
1) The Power to Hire or Selection and Engagement
2) Payment of Wages and Salary
3) Power to Dismiss
4) Power of Control
The power of control is the most important element but such
power need not necessarily be exercised
*see Insular Life v. NLRC, Belasiao (1989)
*see Insular Life v. NLRC, Aninon (1998)
Trilateral relationship (principal, contractor/sub-,
employee)
Article 106. Contractor or sub-contractor. Whenever an employer
enters into a contract with another person for the performance of the
former's work, the employees of the contractor and of the latter's
sub-contractor, if any, shall be paid in accordance with the
provisions of this Code.
In the event that the contractor or sub-contractor fails to
pay the wages of his employees in accordance with this
Code, the employer shall be jointly and severally liable
with his contractor or sub-contractor to such employees
to the extent of the work performed under the contract, in
the same manner and extent that he is liable to employees
directly employed by him. (always take note of this
provision; see PDI v. Orosco; dependent economic test)
The Secretary of Labor and Employment may, by appropriate
regulations, restrict or prohibit the contracting out of labor to protect
the rights of workers established under this Code. In so prohibiting
or restricting, he may make appropriate distinctions between labor-
only contracting as well as differentiations within these types of
contracting, and determine who among the parties involved shall be
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Labor Standards – Atty. V. Duano
New Era University College of Law
considered the employer for purposes of this Code, to prevent any deemed engaged in
violation or circumvention of any provision of this Code. recruitment and
placement.
There is "labor-only" contracting where the person supplying Private "Private (pp) Private
workers to an employer does not have substantial capital or employment employment Recruitment/Employment
investment in the form of tools, equipment, machineries, work agency" means any Agency - refers to any
premises, among others, and the workers recruited and placed by person or entity person, partnership or
engaged in the corporation duly licensed
such person are performing activities which are directly related to
recruitment and by the Secretary of Labor
the principal business of such employer. In such cases, the person or
placement of and Employment to
intermediary shall be considered merely as an agent of the employer workers for a fee engage in the recruitment
who shall be responsible to the workers in the same manner and which is charged, and placement of workers
extent as if the latter were directly employed by him. directly or for overseas employment
indirectly, from the for a fee which is charged,
Article 107. Indirect employer. The provisions of the immediately workers or directly or indirectly,
preceding Article shall likewise apply to any person, partnership, employers or both. from the workers who
association or corporation which, not being an employer, contracts Private "Private renewed their
with an independent contractor for the performance of any work, recruitment recruitment entity" employment contracts
task, job or project. means any person with the same principal.
or association
Article 108. Posting of bond. An employer or indirect employer may engaged in the
recruitment and
require the contractor or sub-contractor to furnish a bond equal to
placement of
the cost of labor under contract, on condition that the bond will
workers, locally or
answer for the wages due the employees should the contractor or overseas, without
sub-contractor, as the case may be, fail to pay the same. charging, directly
or indirectly, any
Article 109. Solidary liability. The provisions of existing laws to the fee from the
contrary notwithstanding, every employer or indirect employer shall workers or
be held responsible with his contractor or subcontractor for any employers.
violation of any provision of this Code. For purposes of determining License "License" means a (w) License - refers to the
the extent of their civil liability under this Chapter, they shall be document issued document issued by the
considered as direct employers. by the Department Secretary of Labor and
of Labor Employment authorizing
*independent contractor and contractor/principal = no ER-EE authorizing a a person, partnership or
person or entity to corporation to operate a
relationship operate a private private
employment recruitment/manning
agency. agency.
RECRUITMENT AND PLACEMENT Authority "Authority" means (b) Authority - refers to a
TERMS LABOR CODE RA 8042, as amended a document issued document issued by the
by 10022 by the Department Secretary of Labor and
*(exclusive on overseas of Labor Employment authorizing
employment) authorizing a the officers, personnel,
Recruitment (b) "Recruitment person or agents or representatives
and and placement" association to of a licensed
Placement refers to any act of engage in recruitment/manning
canvassing, recruitment and agency to conduct
enlisting, placement recruitment and
contracting, activities as a placement activities in a
transporting, private recruitment place stated in the license
utilizing, hiring or entity. or in a specified place.
procuring workers,
and includes *see People v. Panis
referrals, contract
services, * Employee-employer relationship commences from the
promising or
advertising for
point of hire up to the point of deployment
employment, - see Bright maritime case
locally or abroad,
whether for profit *relate/compare with:
or not: Provided, Section 10, RA 8042 (jurisdiction of Labor Arbiter on money
That any person or
entity which, in
claims with ER-EE rel. by virtue of a contract; solidary
any manner, offers liability)
or promises for a
free employment SEC. 10. MONEY CLAIMS. – Notwithstanding any provision of
to two or more law to the contrary, the Labor Arbiters of the National Labor
persons shall be Relations Commission (NLRC) shall have the original and
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Labor Standards – Atty. V. Duano
New Era University College of Law
exclusive jurisdiction to hear and decide, within ninety (90) Exception: ARTCILE 25
calendar days after filing of the complaint, the claims arising out Article 25. Private sector participation in the recruitment and
of an employer-employee relationship or by virtue of any law or placement of workers. Pursuant to national development objectives
contract involving Filipino workers for overseas deployment and in order to harness and maximize the use of private sector
including claims for actual, moral, exemplary and other forms resources and initiative in the development and implementation of a
of damages. comprehensive employment program, the private employment
sector shall participate in the recruitment and placement of workers,
The liability of the principal/employer and the locally and overseas, under such guidelines, rules and regulations, as
recruitment/placement agency for any and all claims under this may be issued by the Secretary of Labor and Employment.
section shall be joint and several. This provisions shall be
incorporated in the contract for overseas employment and shall Article 17 – POEA jurisdiction
be a condition precedent for its approval. The performance bond
to be filed by the recruitment/placement agency, as provided by
Article 22 – Mandatory remittance
law, shall be answerable for all money claims or damages that
Article 22. Mandatory remittance of foreign exchange earnings. It
may be awarded to the workers. If the recruitment/placement
shall be mandatory for all Filipino workers abroad to remit a portion
agency is a juridical being, the corporate officers and directors
of their foreign exchange earnings to their families, dependents,
and partners as the case may be, shall themselves be jointly and
and/or beneficiaries in the country in accordance with rules and
solidarily liable with the corporation or partnership for the
regulations prescribed by the Secretary of Labor and Employment.
aforesaid claims and damages.
Relate with:
Such liabilities shall continue during the entire period or
duration of the employment contract and shall not be affected
by any substitution, amendment or modification made locally or Article 33. Reports on employment status. Whenever the public
in a foreign country of the said contract. interest so requires, the Secretary of Labor and Employment may
direct all persons or entities within the coverage of this Title to
Any compromise/amicable settlement or voluntary agreement submit a report on the status of employment, including job
on money claims inclusive of damages under this section shall be vacancies; details of job requisitions, separation from jobs, wages,
paid within four (4) months from the approval of the settlement other terms and conditions, and other employment data.
by the appropriate authority.
With:
In case of termination of overseas employment without just,
valid or authorized cause as defined by law or contract, the Article 34, Labor Code Section 6, RA 8042
workers shall be entitled to the full reimbursement of his (h) To fail to file reports on the (h) To fail to submit reports on
placement fee with interest of twelve percent (12%) per annum, status of employment, the status of employment,
plus his salaries for the unexpired portion of his employment placement vacancies, placement vacancies,
remittance of foreign exchange remittances of foreign
contract or for three (3) months for every year of the unexpired
earnings, separation from jobs, exchange earnings, separations
term, whichever is less. – (there is a case penned by Leonen with
departures and such other from jobs, departures and such
regard to this; see in the book) matters or information as may other matters or information as
be required by the Secretary of may be required by the
Non-compliance with the mandatory periods for resolutions of cases Labor and Employment. Secretary of Labor and
provided under this section shall subject the responsible officials to Employment;
any or all of the following penalties:

(a) The salary of any such official who fails to render his decision or ILLEGAL RECRUITMENT
resolutions within the prescribed period shall be, or caused to be, Article 38 (a), LC
withheld until the said official complies therewith; Non-licensee/non-holder of
authority
(b) Suspension for not more than ninety (90) days; or Any recruitment activities,
including the prohibited
(c) Dismissal from the service with disqualifications to hold any practices enumerated under
appointive public office for five (5) years. Article 34 of this Code, to be
undertaken by non-licensees or
Provided, however, that the penalties herein provided shall be non-holders of authority, shall
without prejudice to any liability which any such official may have be deemed illegal and
incurred under other existing laws or rules and regulations as a punishable under Article 39 of
consequence of violating the provisions of this paragraph. this Code.
*see Santiago v. CFS case
*see Cuaresma case
*see Pentagon case
ARTICLE 18. BAN ON DIRECT HIRING
General Rule: Should be SOLE/POEA approved
Section 6, RA 8042
Whether with or without
license/authority
illegal recruitment shall mean
any act of canvassing,
enlisting, contracting,
transporting, utilizing, hiring,
procuring workers and
includes referring, contact
services, promising or
advertising for employment
abroad, whether for profit or
not, when undertaken by a
non-license or non-holder of
authority contemplated under
Article 13(f) of Presidential
Decree No. 442, as amended,
otherwise known as the Labor
Code of the Philippines.
Provided, that such non-
license or non-holder, who, in
any manner, offers or promises
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Labor Standards – Atty. V. Duano
New Era University College of Law
for a fee employment abroad to submit reports regularly on prescribed forms, and act on
two or more persons shall be violations of any provision of this Title.
deemed so engaged. It shall
likewise include the following
acts, whether committed by
any persons, whether a non- ARTICLE 26
licensee, non-holder, licensee Article 26. Travel agencies prohibited to recruit. Travel agencies and
or holder of authority. sales agencies of airline companies are prohibited from engaging in
*just see the list of prohibited acts in the book/codal the business of recruitment and placement of workers for overseas
employment whether for profit or not.
*LARGE SCALE IR – always remember that there should be 2 or
more persons who file a complaint RELATE WITH:

*Illegal recruitment problem areas Article 34 (j), LC Section 6 (j), 8042

Article 34 (i) and (g) Article 34(j) To become (j) For an officer or agent of a
officer or member of the Board recruitment or placement
g) To obstruct or attempt to obstruct inspection by the Secretary of of any corporation engaged in agency to become an officer or
Labor and Employment or by his duly authorized representatives; travel agency or to be engaged member of the Board of any
directly or indirectly in the corporation engaged in travel
management of a travel agency agency or to be engaged
(i) To substitute or alter employment contracts approved and verified
directly on indirectly in the
by the Department of Labor and Employment from the time of actual
management of a travel agency
signing thereof by the parties up to and including the period of
expiration of the same without the approval of the Department of
Labor and Employment
ARTICLES 27. 28 - Qualifications
*see case of Sun Ace (doctrine of imputed knowledge) Article 27. Citizenship requirement. Only Filipino citizens or
corporations, partnerships or entities at least 75 percent of the
authorized and voting capital stock of which is owned and controlled
by Filipino citizens shall be permitted to participate in the
PLACEMENT FEES recruitment and placement of workers, locally or overseas.
Article 32. Fees to be paid by workers. Any person applying
with a private fee charging employment agency for Article 28. Capitalization. All applicants for authority to hire or
employment assistance shall not be charged any fee until he renewal of license to recruit are required to have such substantial
has obtained employment through his efforts or has actually capitalization as determined by the Secretary of Labor and
commenced employment. Such fee must be always covered Employment.
with approved receipt clearly showing the amount paid. The
Secretary of Labor and Employment shall promulgate a
schedule of allowable fees. ARTICLE 29 – PROHIBITION ON TRANSFER
Article 29. Non-transferability of license or authority. No license or
authority shall be used directly or indirectly by any person other than
IT IS A PROHIBITED ACT; AN ILLEGAL
the one in whose favor it was issued at any place other than that
RECRUITMENT ACT
stated in the license or authority, nor may such license or authority
Article 34, LC Section 6, 8042 be transferred, conveyed or assigned to any other person or entity.
(a) To charge or accept directly (a) To charge or accept directly Any transfer of business address, appointment or designation of any
or indirectly any amount or indirectly any amount agent or representative including the establishment of additional
greater than that specified in greater than the specified in the
offices anywhere shall be subject to the prior approval of the
the schedule of allowable fees schedule of allowable fees
Department of Labor and Employment.
prescribed by the Secretary of prescribed by the Secretary of
Labor and Employment, or to Labor and Employment, or to
make a worker pay any amount make a worker pay any amount *see people v. gauduri (?) – exception on the liability
greater than that actually greater than that actually
received by him as a loan or received by him as a loan or
advance advance ARTICLE 40 – ALIEN EMPLOYMENT
JUST REMEMBER THAT THIS IS ONLY APPLICABLE
IF THE ALIEN IS A NON-RESIDENT. HENCE, IF
VISITORIAL POWER RESIDENT, HE/SHE IS NOT REQUIRED TO SECURE
Article 34(g) To obstruct or attempt to obstruct inspection by AN ALIEM EMPLOYMENT PERMIT (AEP)
the Secretary of Labor and Employment or by his duly
authorized representatives *see requirements for hiring

Relate with:
Article 37. Visitorial power. The Secretary of Labor and
Employment or his duly authorized representatives may at
any time inspect the premises, books of accounts and records
of any person or entity covered by this Title, require it to
5