Key Notes on LABOR
STANDARDS and
related labor cases
Art. 1. Name of Decree. This Decree shall be known as the "Labor Code of the Philippines".
Presidential Decree No. 442 – otherwise known as the “Labor Code of the Philippines.
Social legislation – include laws that provide particular kinds of protection or benefits to society or segments thereof in furtherance of social justice.
Labor Legislation – consists of statutes, regulations and jurisprudence governing the relations between capital and labor, by providing for employment standards and a legal framework for negotiating, adjusting and administering those standards and other incidents of employment.
Classifications of Labor Legislation
1. Labor standards law – is that which sets out the minimum terms, conditions and benefits of employment that employers must provide or comply with and to which employees are entitled as a matter of legal right.
As defined more specifically by jurisprudence, “are the minimum requirements prescribed by existing laws, rules and regulations relating to wages, hours of work, cost-of-living allowance, and other monetary welfare benefits, including occupational safety, and health standards.” (Maternity Children's Hospital vs. Secretary of Labor, GR No. 78909, June 30, 1989.)
2. Labor relations law – defines the status, rights and duties, and the institutional mechanisms, that govern the individual and collective interactions of employers, employees or their representatives. Labor - is understood as physical toil although it does not necessarily exclude the application of skill, thus there is skilled and unskilled labor.
Distinction: Labor law and social legislation Labor laws- directly affect employment
Social legislation- governs effects of Employment. - are social legislation
- not all SL are Labor Laws
Social Justice – is “neither communism, nor despotism, nor atomism nor anarchy, but the humanization of laws and the equalization of social and economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated. Social justice means the promotion of the welfare of all the people, the adoption by the Government of measures calculated to insure economic stability of all the component elements of society, through the maintenance of a proper economic and social equilibrium in the interrelations of the members of the community, constitutionally, through the adoption of measures legally justifiable, or extra-constitutionally, the exercise of powers underlying the existence of all governments on the time-honored principle of
salus populi est suprema lex.” (Calalang vs. Williams, 70 Phil. 726.)
While social justice is the raison d'etre of labor laws, their basis or foundation is the police power of the State.
Police Power – is the power of the government to enact laws, within constitutional limits, to promote the order, safety, health, morals and general welfare of society.
It is settled that state legislatures may enact laws for the protection of the safety and health of employees as an exercise of police power.
Art. 2. Date of effectivity. This Code shall take effect six (6) months after its promulgation.
May 1, 1974 – PD No. 442 was signed into law. November 01, 1974 – effectivity date of the Labor Code. Related Laws: Civil Code, RPC, Special Laws
Art. 3. Declaration of basic policy. The State shall afford protection to labor, promote full employment, ensure equal work opportunities regardless of sex, race or creed and regulate the relations between workers and employers. The State shall assure the rights of workers to self-organization, collective bargaining, security of tenure, and just and humane conditions of work.
The Basic Policy of the Labor Code (social economic goals) 1. Protection to labor;
2. Promote full employment;
3. Ensure equal work opportunities regardless of sex, race or creed, and
4. Regulate the relations between workers and employers
Both sectors (employees and employers) need each other. They are interdependent – one is inutile without the other. The basic policy is to balance or to coordinate the rights and interests of both workers and employers.
Rights of Workers Under Art. 3 of the Labor Code 1. Self-organization;
2. Collective bargaining; 3. Security of tenure; and
4. Just and humane conditions of work Constitutional Basis of the Labor Code
Art. II, Sec. 18 - the 1987 Constitution declares as a state policy: “The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare.”
Art. III, Sec. 18, par. 2 – no involuntary servitude Art. IX-B, Sec. 2, Par. 1 – CSC embraces all
branches... agencies of government, including GOCCs with original charters.
Art. IX-B, Sec. 2, par. 3 – No officer or employee shall be removed or suspended except for cause provided by law
Art. IX-B, Sec. 5 – standardization of compensation of government officials and employees.
Art. XII, Sec. 6 – the right to own, establish economic enterprises subject to the duty of the State to promote distributive justice
Art. XII, Sec. 14, par. 2 – practice of all professions shall be limited to Filipinos
Art. XII, Sec. 16 – Congress shall not provide for the formation, organization, or regulation of private corporations
Art. XIII, Sec. 1 – protect and enhance right to human dignity, reduce social, economic and political irregularities, and remove cultural inequalities by equitably diffusing wealth and political power for the common good
Art. XIII, Sec. 2 – promotion of social justice shall include the commitment to create economic opportunities
Art. XIII, Sec. 3, par. 1 – protection to labor, local and overseas, organized and organized, and promote full employment and equality of employment opportunities for all
Art. XIII, Sec. 3, par. 2 – guarantee the rights of all workers:
(1) self-organization;
(2) collective bargaining and negotiations;
(3) peaceful concerted activities, including the right to strike in accordance with law;
(4) security of tenure; (5) humane conditions of work; (6) living wage;
(7) participate in policy and decision-making processes affecting their rights and benefits Art. XIII, Sec. 3, par. 3 – shared responsibility:
voluntary modes in settling disputes
Art. XIII, Sec. 3, par. 4 – 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. (Constitutional balance between the rights of workers and employers)
Job is a property, and no person shall be deprived of life, liberty, and property without due process.
Through distributive justice, labor must receive what is due them for the return of investment.
Art. 4. Construction in favor of labor.
All doubts in the implementation and interpretation of the provisions of this Code, including its implementing rules and regulations, shall be resolved in favor of labor.
The Supreme Court adopts the liberal approach which favors the exercise of labor rights.
The labor law is liberally construed in favor of the workers and strictly construed against the employers.
Reason for according greater protection to employees
In the matter of employement bargaining, there is no doubt that the employer stands on higher footing than the employee. Those who have less in life should have more in law. Management Rights
It should not be supposed that every labor dispute will be automatically decided in favor of labor. Management has also its own rights which are entitled to respect and enforcement in the interest of simple fair play.
The law, in protecting the rights of the laborer, authorizes neither oppression nor self-destruction of the employer.
Right to Return of Investments (ROI) – the employer has the right to recover his investments and to make profit. The Constitution provides that the State shall regulate the relations between workers and employers, recognizing the right of labor to its just share... and the right of enterprises to reasonable returns on investments, and to expansion and growth. The Right to Prescribe Rules – employers have the
right to make reasonable rules and regulations for the government of their employees, and when employees, with knowledge of an established rule, enter the service, the rule becomes part of the contract of employment.
The Right to Select Employees – an employer has a right to select his employees and to decide when to engage them. The State has no right to interfere in a private employment; it cannot interfere with the liberty of contract with respect to labor except in the exercise of the police power. If the employer can compel the employee to work against the latter's will, this is servitude. If the employee can compel the employer to give him work against the employer's will, this is oppression.
Right to Transfer or Discharge Employees – the employer has the perfect right to transfer, reduce or lay off personnel in order to minimize expenses and to insure the stability of the business, and even to close the business, provided the transfer or dismissal is not abused but is done in good faith and is due to causes beyond control. To hold otherwise would be oppressive and inhuman.
Art. 5. Rules and regulations. The Department of Labor and other government agencies charged with the administration and enforcement of this Code or any of its parts shall promulgate the necessary implementing rules and regulations. Such rules and regulations shall become effective fifteen (15) days after announcement of their adoption in newspapers of general circulation.
The Labor Code itself in Art. 5 vests the Department of Labor and Employment with rule-making powers in the enforcement thereof.
ART. 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).
The Code is applicable to all employees in private sector and government corporations without original charter.
Under the present state of the law, the test in determining whether a government-owned or controlled corporation is subject to the Civil Service Law is the manner of its creation.
Government corporations created by special (original charter) from Congress are subject to Civil Service rules,
while those incorporated under the general Corporation Law
are covered by the Labor Code.
The government-owned-and-controlled corporations “with original charter” refer to corporations chartered by special law as distinguished from corporation organized under our general incorporation statute, the Corporation Code.
While government employees are allowed under the 1987 Constitution to organize and join union of their choice, there is no law permitting them to strike.
Art. 128. Visitorial and enforcement power.
Visitorial Power of the Secretary of Labor and Employment or his duly authorized representatives, including labor regulation officers
1. Access to employer’s records and premises at any time of the day or night whenever work is being undertaken therein;
2. To copy from employer's records; 3. To question any employee
4. To investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of this Code
Enforcement Power of the Secretary of Labor and Employment or his duly authorized representatives
1. To to issue compliance orders to give effect to the labor standards provisions of this Code and other labor legislation based on the findings of labor employment and enforcement officers or industrial safety engineers made in the course of inspection; 2. To issue writs of execution to the appropriate
authority for the enforcement of their orders; 3. The Secretary of Labor and Employment to order
stoppage of work or suspension of operations of any unit or department of an establishment when non-compliance with the law or implementing rules and regulations poses grave and imminent danger to the health and safety of workers in the workplace. 4. The Secretary of Labor and Employment may require
employers to keep and maintain such employment records as may be necessary in aid of his visitorial and enforcement powers under this Code.
It is the right of employer to ask authority from visiting labor personnel. Failure may result to a waiver.
Employer's remedy to contest the findings of the Secretary of Labor and Employment or his duly authorized representatives is the presentation of documentary evidence, i.e. payrolls, SSS payment receipts.
An order issued by the duly authorized representative of the Secretary of Labor and Employment under this Article may be appealed to the latter. In case said order involves a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Secretary of Labor and Employment in the amount equivalent to the monetary award in the order appealed from.
Within twenty-four hours, a hearing shall be conducted to determine whether an order for the stoppage of work or suspension of operations shall be lifted or not. In case the violation is attributable to the fault of the employer, he shall pay the employees concerned their salaries or wages during the period of such stoppage of work or suspension of operation.
It shall be unlawful for any person or entity to obstruct, impede, delay or otherwise render ineffective the orders of the
Secretary of Labor and Employment or his duly authorized representatives issued pursuant to the authority granted under this Article, and no inferior court or entity shall issue temporary or permanent injunction or restraining order or otherwise assume jurisdiction over any case involving the enforcement orders issued in accordance with this Article. Any government employee found guilty of violation of, or abuse of authority, under this Article shall, after appropriate administrative investigation, be subject to summary dismissal from the service.
Art. 129. Recovery of wages, simple money claims and other benefits.
The Regional Director of the Department of Labor and Employment or any of the duly authorized hearing officers of the Department is empowered, through summary proceeding and after due notice, to hear and decide:
1. any matter involving the recovery of wages and other monetary claims and benefits, including legal interest, provided that the aggregate money claims of each employee or househelper does not exceed Five thousand pesos (P5,000.00).
2. owing to an employee or person employed in domestic or household service or househelper under this Code
3. arising from employer-employee relations
4. complaint does not include a claim for reinstatement; and
The Regional Director or hearing officer shall decide or resolve the complaint within thirty (30) calendar days from the date of the filing of the same.
Any sum thus recovered on behalf of any employee or househelper pursuant to this Article shall be held in a special deposit account by, and shall be paid on order of, the (1) Secretary of Labor and Employment or (2) the Regional Director or (3) directly to the employee or househelper concerned.
Any such sum not paid to the employee or househelper because he cannot be located after diligent and reasonable effort to locate him within a period of three (3) years, shall be held as a special fund of the Department of Labor and Employment to be used exclusively for the amelioration and benefit of workers.
Any decision or resolution of the Regional Director or hearing officer pursuant to this provision may be appealed on the same grounds provided in Article 223 of this Code, within five (5) calendar days from receipt of a copy of said decision or resolution, to the National Labor Relations Commission which shall resolve the appeal within ten (10) calendar days from the submission of the last pleading required or allowed under its rules.
The Secretary of Labor and Employment or his duly authorized representative may supervise the payment of unpaid wages and other monetary claims and benefits, including legal interest, found owing to any employee or househelper under this Code. (As amended by Section 2, Republic Act No. 6715, March 21, 1989)
Art. 217. Jurisdiction of the Labor Arbiters and the Commission.
The Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the parties for
decision without extension the following cases involving all workers, whether agricultural or non-agricultural:
Unfair labor practice cases; Termination disputes;
If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment;
Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations;
Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts; and
Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement.
The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters.
Cases arising from the interpretation or implementation of collective bargaining agreements and those arising from the interpretation or enforcement of company personnel policies shall be disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration as may be provided in said agreements.
Stages in the hearing of cases
1. Labor arbiter; and may be appealed to
2. the National Labor Relations Commission (NLRC); and may be appealed to
3. the Court of Appeals (CA); and may be appealed to 4. the Supreme Court (SC).
Book One
PRE-EMPLOYMENT Title I
RECRUIT AND PLACEMENT OF WORKERS Chapter I
Art. 13. Definitions
Worker – any member of the labor force, whether employed or unemployed.
Recruitment and placement – any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not: Provided, That any person or entity which, in any manner, offers or promises for a fee, employment to two or more persons shall be deemed engaged in recruitment and placement.
“employment to two or more persons shall be
deemed engaged in recruitment and placement”
-this is only a matter of evidence. Thus, even the employment involves only one person, there is already the engagement of recruitment and placement.
The number of persons dealt with is not the basis in determining whether or not an act constitutes recruitment and placement. Any of the acts
mentioned in Article 13(b) will constitute recruitment and placement even if only one prospective worker is involved. In that case, a license or authority from POEA is needed.
License – means a document issued by the Department of Labor authorizing a person or entity to operate a private employment agency.
Authority – a document issued by the Department of Labor authorizing a person or association to engage in recruitment and placement activities as a private recruitment entity. Art. 18. Ban on direct-hiring
General Rule:
No employer may hire a Filipino worker for overseas employment.
Exception:
Through the Boards and entities authorized by the Secretary of Labor
Direct-hiring by members of the diplomatic corps, international organizations and such other employers as may be allowed by the Secretary of Labor REPUBLIC ACT NO. 8042
Migrant Workers and Overseas Filipinos Act of 1995
An act to institute the policies of overseas employment and establish a higher standard of protection and promotion of the welfare of migrant workers, their families and overseas Filipinos in distress, and for other purposes.
SEC. 2. DECLARATION OF
POLICIES-- The State does not promote overseas employment as a means to sustain economic growth and achieve national development. The existence of the overseas
employment program rests solely on the assurance that the dignity and fundamental human rights and freedoms of the Filipino citizens shall not, at any time, be compromised or violated. The State,
therefore, shall continuously create local employment opportunities and promote the equitable distribution of wealth and the benefits of development.
SEC. 3. DEFINITIONS
Migrant worker – a person who is to be engaged, is engaged or has been engaged in a renumerated activity in a state of which he or she is not a legal resident to be used interchangeably with overseas Filipino worker.
Overseas Filipinos – dependents of migrant workers and other Filipino nationals abroad who are in distress as mentioned in Sections 24 and 26 of this Act.
II. ILLEGAL RECRUITMENT Sec. 6. DEFINITIONS
Illegal recruitment – 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. Provided, that such non-license or non-holder, who,
in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so engaged. It
shall likewise include the following acts, whether committed by any persons, whether a non-licensee, non-holder, licensee or holder of authority.
(a) To charge or accept directly or indirectly any amount
greater than the specified in the schedule of allowable fees prescribed by the Secretary of Labor and Employment, or to
make a worker pay any amount greater than that actually received by him as a loan or advance;
(b) To furnish or publish any false notice or information or document in relation to recruitment or employment;
(c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the
purpose of securing a license or authority under the Labor
Code;
(d) To induce or attempt to induce a worker already employed to quit his employment in order to offer him another
unless the transfer is designed to liberate a worker from oppressive terms and conditions of employment;
(e) To influence or attempt to influence any persons or entity not to employ any worker who has not applied for
employment through his agency;
(f) To engage in the recruitment of placement of workers in
jobs harmful to public health or morality or to dignity of the Republic of the Philippines;
(g) To obstruct or attempt to obstruct inspection by the
Secretary of Labor and Employment or by his duly authorized representative;
(h) To fail to submit reports on the status of employment, placement vacancies, remittances of foreign exchange earnings, separations from jobs, departures and such other matters or information as may be required by the Secretary of
Labor and Employment;
(i) To substitute or alter to the prejudice of the worker,
employment contracts approved and verified by the Department of Labor and Employment from the time of
actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the Department of Labor and Employment;
(j) For an officer or agent of a recruitment or placement
agency to become an officer or member of the Board of any corporation engaged in travel agency or to be engaged
directly on indirectly in the management of a travel agency; (k) To withhold or deny travel documents from applicant
workers before departure for monetary or financial
considerations other than those authorized under the Labor
Code and its implementing rules and regulations;
(l) Failure to actually deploy without valid reasons as determined by the Department of Labor and Employment; and (m) Failure to reimburse expenses incurred by the workers
in connection with his documentation and processing for purposes of deployment, in cases where the deployment does
not actually take place without the worker's fault.
Illegal recruitment when committed by a syndicate or in large scale shall be considered as offense involving economic sabotage.
Syndicate – is illegal recruitment carried out by a group of three (3) or more persons conspiring or confederating with one another.
Large scale – is illegal recruitment committed against three (3) or more persons individually or as a group.
The persons criminally liable for the above offenses are the principals, accomplices and accessories. In case of juridical persons, the officers having
control, management or direction of their business shall be liable.
An employee who was merely acting under the direction of his superiors and was unaware that his acts constituted a crime may not be held criminally liable.
SEC. 7. PENALTIES
(a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and
one (1) day but not more than twelve (12) years and a fine not less than two hundred thousand pesos (P200,000.00) nor more than five hundred thousand pesos (P500,000.00).
(b) The penalty of life imprisonment and a fine of not less
than five hundred thousand pesos (P500,000.00) nor more than one million pesos (P1,000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined
herein.
Provided, however, that the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of age or committed by a licensee or non-holder of authority.
SEC. 8. PROHIBITION ON OFFICIALS AND EMPLOYEES
It shall be unlawful for:
1. any official or employee of the Department of Labor
and Employment, the Philippine Overseas Employment Administration, or the Overseas Workers Welfare Administration, or the Department of Foreign Affairs, or other government agencies
involved in the implementation of this Act,
2. or their relatives within the fourth civil degree of
consanguinity or affinity, to engage, directly or
indirectly, in the business of recruiting migrant
workers as defined in this Act. The penalties shall be
imposed upon them. SEC. 9. VENUE
herein shall be filed with the Regional Trial Court of the
province or city where the offense was committed or where the offended party actually resides at the same time of the commission of the offense: Provided, That the court where the criminal action is first filed shall acquire jurisdiction to the exclusion of other courts. Provided, however, That the
aforestated provisions shall also apply to those criminal actions that have already been filed in court at the time of the effectivity of this Act.
SEC. 10. MONEY CLAIMS
But withstanding any provision of law to the contrary, the
Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after filing
of the complaint, the claims arising out of an
employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including
claims for actual, moral, exemplary and other forms of damages.
The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint and several. The performance bond to be filed by the
recruitment/placement agency, as provided by law, shall be answerable for all money claims or damages that may be awarded to the workers. 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 in a foreign country
of the said contract.
Any compromise/amicable settlement or voluntary agreement on money claims inclusive of damages under this section shall be paid within four (4)
months from the approval of the settlement by the
appropriate authority.
In case of termination of overseas employment
without just, valid or authorized cause as defined by law or contract, the workers shall be entitled to the
full reimbursement of his placement fee with interest of twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less.
Non-compliance with the mandatory periods for resolutions of cases provided under this section shall subject the responsible officials to any or all of the following penalties:
(a) The salary of any such official who fails to render his decision or resolutions within the prescribed period shall be, or caused to be, withheld until the said official complies therewith;
(b) Suspension for not more than ninety (90) days; or
(c) Dismissal from the service with disqualifications to hold any appointive public office for five (5) years.
SEC. 12. PRESCRIPTIVE PERIODS
Illegal recruitment cases under this Act shall prescribe in five (5) years: Provided, however, That illegal recruitment cases involving economic sabotage as defined herein shall prescribe in twenty (20) years.
SEC. 15. REPATRIATION OF WORKERS; EMERGENCY REPATRIATION FUND
The repatriation of the worker and the transport of his personal belongings shall be the primary responsibility of the agency which recruited or deployed the worker overseas. All costs attendant to
repatriation shall be borne by or charged to the agency concerned and/or its principal. Likewise, the
repatriation of remains and transport of the personal belongings of a deceased worker and all costs attendant thereto shall be borne by the principal and/or local agency.
However, in cases where the termination of employment is due solely to the fault of the worker, the principal/employer or agency shall not in any
manner be responsible for the repatriation of the
former and/or his belongings.
The Overseas Workers Welfare Administration
(OWWA), in coordination with appropriate international agencies, shall undertake the repatriation of workers in cases of war, epidemic, disasters or calamities, natural or man-made, and other similar events without prejudice to
reimbursement by the responsible principal or agency. However, in cases where the principal or recruitment agency cannot be identified, all costs attendant to repatriation shall be borne by the OWWA.
Parties to overseas employment contracts are allowed to agree on terms and conditions, but the stipulations should not contradict Philippine law, public policy and morals.
The Welfare Fund for Overseas Workers Administration (OWWA) was intended to provide social welfare services.
The principal agency has to advance the air
transport fare to the Philippines and immediately
bring back the workers, as needed. If the cause of
termination is due solely to the fault of the worker, the principal or agency may recover the cost of repatriation from the worker after return to the country. They cannot remain stranded in a foreign
land just because of a pending legal proceeding (Equi-Asia Placement Inc. vs. DFA and DOLE, GR No. 152214, September 19, 2006).
Chapter II
REGULATION OF RECRUITMENT AND PLACEMENT ACTIVITIES
Art. 25. Private sector participation in the recruitment and placement of workers.
The private employment sector shall participate in the recruitment and placement of workers, locally and overseas, under such guidelines, rules and regulations as may be
issued by the Secretary of Labor.
Art. 26. Travel agencies prohibited to recruit.
Travel agencies and sales agencies of airline companies are prohibited from engaging in the business of recruitment and placement of workers for overseas employment whether for profit or not.
Art. 27. Citizenship requirement.
Only Filipino citizens or corporations, partnerships or entities at least seventy-five percent (75%) of the authorized and
voting capital stock of which is owned and controlled by Filipino citizens shall be permitted to participate in the
recruitment and placement of workers, locally or overseas.
Art. 28. Capitalization.
All applicants for authority to hire or renewal of license to recruit are required to have such substantial capitalization as
determined by the Secretary of Labor.
Art. 29. Non-transferability of license or authority.
No license or authority shall be used directly or indirectly by
any person other than the one in whose favor it was issued or
at any place other than that stated in the license or authority
be transferred, conveyed or assigned to any other person or entity. Any transfer of business address, appointment or designation of any agent or representative including the establishment of additional offices anywhere shall be subject
to the prior approval of the Department of Labor.
Art. 30. Registration fees.
The Secretary of Labor shall promulgate a schedule of fees
for the registration of all applicants for license or authority. Art. 31. Bonds.
All applicants for license or authority shall post such cash and surety bonds as determined by the Secretary of Labor to guarantee compliance with prescribed recruitment procedures, rules and regulations, and terms and conditions of employment as may be appropriate.
Art. 32. Fees to be paid by workers.
Any person applying with a private fee-charging employment
agency for employment assistance shall not be charged any
fee until he has obtained employment through its efforts or
has actually commenced employment. Such fee shall be
always covered with the appropriate receipt clearly showing
the amount paid. The Secretary of Labor shall promulgate a schedule of allowable fees.
Art. 33. Reports on employment status.
Whenever the public interest requires, the Secretary of Labor may direct all persons or entities within the coverage of this
Title to submit a report on the status of employment, including job vacancies, details of job requisitions, separation from jobs, wages, other terms and conditions and other employment data.
Art. 34. Prohibited practices.
These prohibited acts constitutes illegal recruitment as redefined by RA No. 8042.
Art. 35. Suspension and/or cancellation of license or authority.
The Minister of Labor shall have the power to suspend or cancel any license or authority to recruit employees for
overseas employment for violation of rules and regulations issued by the Ministry of Labor, the Overseas Employment
Development Board, or for violation of the provisions of this and other applicable laws, General Orders and Letters of Instructions.
A recruitment agency is solidarily liable for the unpaid salaries of a worker it recruited for employment with foreign principal.
Even if the recruitment agency and the principal had already ended their agency agreement at the tim the worker was injured, the recruitment agency may still be sued for violation of the employment contract, if no notice of the agency agreement's termination was given to the employee.
Chapter III
MISCELLANEOUS PROVISIONS Art. 36. Regulatory power.
The Secretary of Labor shall have the power to restrict and regulate the recruitment and placement activities of all agencies within the coverage of this Title and is hereby
authorized to issue orders and promulgate rules and regulations to carry out the objectives and implement the provisions of this Title.
Art. 37. Visitorial Power.
The Secretary of Labor 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 submit reports regularly on prescribed forms, and act on violation of any provisions of this Title.
Art. 38. Illegal recruitment.
Such acts are already contained in RA No. 8042.
Title II
EMPLOYMENT OF NON-RESIDENT ALIENS Art. 40. Employment permit of non-resident aliens. Any alien seeking admission to the Philippines for employment purposes and any domestic or foreign employer who desires to engage an alien for employment in the Philippines shall obtain an employment permit from the Department of Labor.
The employment permit may be issued to a non-resident alien or to the applicant employer after a determination of the non-availability of a person in the Philippines who is competent, able and willing at the time of application to
perform the services for which the alien is desired.
For an enterprise registered in preferred areas of investments,
said employment permit may be issued upon recommendation of the government agency charged with the supervision of said registered enterprise.
Art. 41. Prohibition against transfer of employment After the issuance of an employment permit, the alien shall
not transfer to another job or change his employer without prior approval of the Secretary of Labor.
Any non-resident alien who shall take up employment in
violation of the provision of this Title and its implementing
the provisions of Articles 289 and 290 of the Labor Code.
In addition, the alien worker shall be subject to deportation
after service of his sentence.
Art. 42. Submission of list.
Any employer employing non-resident foreign nationals on
the effective date of this Code shall submit a list of such
nationals to the Secretary of Labor within thirty (30) days
xxxx. The Secretary of Labor shall then determine if they are entitled to an employment permit.
Permits to be issued:
Alien Employment Permit (AEP) – for non-resident alien Alien Employment Registration Certificate (AERC) – for
resident alien BOOK TWO
HUMAN RESOURCES DEVELOPMENT PROGRAM
Title II
TRAINING AND EMPLOYMENT OF SPECIAL WORKERS
Chapter I APPRENTICES
Art. 58. Definition of Terms.
Apprenticeship – practical training on the job supplemented by related theoretical instruction.
Apprentice – is a worker who is covered by a written apprenticeship agreement with an individual employer or any of the entities recognized under this Chapter.
Apprenticeable occupation – any trade, form of employment or occupation which requires more than three (3) months of practical training on the job supplemented by related theoretical instruction.
Art. 59. Qualifications of apprentice. (a) Be at least fourteen (14) years of age;
(b) Possess vocational aptitude and capacity for appropriate tests; and
(c) Possess the ability to comprehend and follow oral and written instructions.
Art. 60. Employment of apprentices.
Only employers in the highly technical industries may employ apprentices and only in apprenticeable occupations approved by the Secretary of Labor and Employment.
Art. 61. Contents of apprenticeship agreements.
Apprenticeship agreements, including the wage rates of apprentices, shall conform to the rules issued by the Secretary of Labor and Employment. The period of apprenticeship shall
not exceed six months. Apprenticeship agreements providing
for wage rates below the legal minimum wage, which in no
case shall start below 75 percent of the applicable minimum wage, may be entered into only in accordance with
apprenticeship programs duly approved by the Secretary of Labor and Employment. The Department shall develop standard model programs of apprenticeship.
Art. 65. Investigation of violation of apprenticeship
agreement.
Upon complaint of any interested person or upon its own initiative, the appropriate agency of the Department of Labor and Employment or its authorized representative shall investigate any violation of an apprenticeship agreement
pursuant to such rules and regulations as may be prescribed by the Secretary of Labor and Employment.
Art. 66. Appeal to the Secretary of Labor and Employment.
The decision of the authorized agency of the Department of Labor and Employment may be appealed by any aggrieved person to the Secretary of Labor and Employment within five (5) days from receipt of the decision. The decision of the
Secretary of Labor and Employment shall be final and executory.
Art. 67. Exhaustion of administrative remedies.
No person shall institute any action for the enforcement of any apprenticeship agreement or damages for breach of any such agreement, unless he has exhausted all available administrative remedies.
Art. 70. Voluntary organization of apprenticeship programs; exemptions.
General rule:
The organization of apprenticeship program shall be primarily a voluntary undertaking by employers;
Exceptions:
(a) When national security or particular requirements
of economic development so demand, the President
of the Philippines may require compulsory training of apprentices in certain trades, occupations, jobs or employment levels where shortage of trained manpower is deemed critical as determined by the Secretary of Labor and Employment. Appropriate rules in this connection shall be promulgated by the Secretary of Labor and Employment as the need arises; and
(b) Where services of foreign technicians are utilized by
private companies in apprenticeable trades, said
companies are required to set up appropriate apprenticeship programs.
Art. 71. Deductibility of training costs
An additional deduction from taxable income of one-half
(1/2) of the value of labor training expenses incurred for
developing the productivity and efficiency of apprentices shall be granted to the person or enterprise organizing an apprenticeship program:
Provided: That such program is duly recognized by
the Department of Labor and Employment:
Provided, further, That such deduction shall not
exceed ten (10%) percent of direct labor wage:
and
◦ Provided, finally, That the person or enterprise who wishes to avail himself or
itself of this incentive should pay his
apprentices the minimum wage.
Art. 72. Apprentices without compensation.
The Secretary of Labor and Employment may authorize the
hiring of apprentices without compensation
(a) whose training on the job is required by ◦ the school or
◦ training program curriculum (b) or as requisite for
◦ graduation or ◦ board examination. Notes:
In relation to Art. 72, the Implementing Rules provide that there is no employer-employee
relationship between students on one hand, and schools on the other, where there is written agreement under which the former agree to work for
the latter in exchange for the privilege to study free of charge, provided the students are given real
opportunities to finish their chosen courses under
such agreement.
However, in the case of Filamer Christian Institute
vs. Hon. Intermediate Apellate Court, et. al., GR No. 75112, August 17, 1992, the Supreme Court that the applicable law was Art. 2180 of the Civil Code and not the Labor Code's implementing rule. Under
Art. 2180, an injured party shall have recourse against the servant as well as the petitioners school for whom, at the time of incident, the servant was performing an act in furtherance of the interest and for the benefit of the school.
Four-Fold Test in Determining Employer-Employee Relationship
1. the selection and engagement of the employee 2. the payment of wages
3. the power of dismissal
4. the employer's power to control with respect to the means and methods by which the work is to be accomplished (Brotherhood vs. Zamora)
Chapter II LEARNERS
Art. 73. Learners defined.
Learners – persons hired as trainees in semi-skilled and other
industrial occupations which are non-apprenticeable and which may be learned through practical training on the job in a relatively short period of time which shall not exceed three (3) months.
Art. 74. When learners may be hired. Learners may be employed when:
1. No experienced workers are available;
2. The employment of learners is necessary to prevent curtailment of employment opportunities; and, 3. The employment does not create unfair competition
in terms of labor costs or impair or lower working standards.
Art. 75. Learnership agreement.
Any employer desiring to employ learners shall enter into a learnership agreement with them, which agreement shall
include:
The names and addresses of the learners;
The duration of the learnership period, which shall
not exceed three (3) months;
The wages or salary rates of the learners which shall begin at not less than seventy-five percent (75%) of
the applicable minimum wage; and
A commitment to employ the learners if they so
desire, as regular employees upon completion of the learnership.
All learners who have been allowed or suffered to work during the first two (2) months shall be deemed regular employees if training is terminated by the employer before the end of the stipulated period through no fault of the learners.
The learnership agreement shall be subject to inspection by
the Secretary of Labor and Employment or his duly
authorized representative. Art. 76. Learners in piecework.
Learners employed in piece or incentive-rate jobs during the
training period shall be paid in full for the work done. Art. 77. Penalty clause.
Any violation of this Chapter or its implementing rules and regulations shall be subject to the general penalty clause provided for in this Code.
Learnership vs. Apprenticeship
Learnership Apprenticeship
Similarities:
Both mean training periods for jobs requiring skills that can be acquired through actual work experience Both may be paid wages twenty-five percent lower than
the applicable minimum wage
Distinctions:
A learner trains in semi-skilled job or in industrial occupations that require
Allowed even for non technical jobs Training shall not exceed three months
A learner is not an apprentice
An employer is committed to hire the learner-trainee as an employee after the training period
Similarities:
Both mean training periods for jobs requiring skills that can be acquired through actual work experience Both may be paid wages twenty-five percent lower than
the applicable minimum wage
Distinctions:
An apprentice trains in a highly skilled job or in a job found only in highly technical industry Allowed only in highly technical industries
Training exceeds three months Conceptually, an apprentice is also a learner In apprenticeship, no such commitment exists
Chapter III
HANDICAPPED WORKERS Art. 78. Definition.
Handicapped workers – those whose earning capacity is impaired by age or physical or mental deficiency or injury. Art. 79. When employable.
Handicapped workers may be employed:
1. When their employment is necessary to prevent curtailment of employment opportunities; and, 2. When it does not create unfair competition in labor
costs or impair or lower working standards. Art. 80. Employment agreement.
Any employer who employs handicapped workers shall enter into an employment agreement with them, which agreement shall include:
The names and addresses of the handicapped
workers to be employed;
The rate to be paid the handicapped workers which shall not be less than seventy five (75%) percent of
the applicable legal minimum wage;
The duration of employment period; and
The work to be performed by handicapped workers. The employment agreement shall be subject to inspection by
the Secretary of Labor or his duly authorized representative.
Art. 81. Eligibility for apprenticeship.
Subject to the appropriate provisions of this Code, handicapped workers may be hired as apprentices or
learners if:
their handicap is not such as to effectively impede the performance of job operations in the particular occupations for which they are hired.
Art. 135. 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.
Art. 136. 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. 139. Minimum employable age.
(a) No child below fifteen (15) years of age shall be employed, except when he works directly under the sole responsibility of his parents or guardian, and his employment does not in any way interfere with his schooling.
(b) Any person between fifteen (15) and eighteen (18) years of age may be employed for such number of hours and such periods of the day as determined by the Secretary of Labor and Employment in appropriate regulations.
(c) The foregoing provisions shall in no case allow the employment of a person below eighteen (18) years of age in an undertaking which is hazardous or deleterious in nature as determined by the Secretary of Labor and Employment.
Art. 140. Prohibition against child discrimination.
No employer shall discriminate against any person in respect
REPUBLIC ACT NO. 9231
Law Eliminating the Worst Forms of Child Labor
Section 2. Section 12 of the same Act, as amended, is hereby further amended to read as follows:
"Sec. 2. Employment of Children
-General Rule: Children below fifteen (15) years of age shall not be employed
except:
1. When a child works directly under the: (a) sole
responsibility of his/her parents or legal guardian and (b) where only members of his/her family are employed:
Provided, however, That his/her (c) employment neither
endangers his/her life, safety, health, and morals, nor impairs his/her normal development: Provided, further, That
(d) the parent or legal guardian shall provide the said child
with the prescribed primary and/or secondary education; or
2. Where a child's (a) employment or participation in public
entertainment or information through cinema, theater, radio, television or other forms of media is essential: Provided, That
the (b) employment contract is concluded by the child's
parents or legal guardian, (c) with the express agreement of the child concerned, if possible, and the (d) approval of the Department of Labor and Employment: Provided, further, That the (e) following requirements in all instances are strictly complied with:
"(a) The employer shall ensure the protection, health, safety,
morals and normal development of the child;
"(b) The employer shall institute measures to prevent the
child's exploitation or discrimination taking into account the
system and level of remuneration, and the duration and arrangement of working time; and
"(c) The employer shall formulate and implement, subject to the approval and supervision of competent authorities, a
continuing program for training and skills acquisition of the child.
"In the above-exceptional cases where any such child may be
employed, the employer shall first secure, before engaging
such child, a work permit from the Department of Labor and Employment which shall ensure observance of the above
requirements.
"For purposes of this Article, the term
Child – shall apply to “all persons under eighteen (18) years of age.”
Section 3. The same Act, as amended, is hereby further amended by adding new sections to be denominated as Sections 12-A, 12-B, 12-C, and 12-D to read as follows:
"Sec. 2-A. Hours of Work of a Working Child. - Under the exceptions provided in Section 12 of this Act, as amended:
"(1) A child below fifteen (15) years of age may be allowed to work for not more than twenty (20) hours a week: Provided, That the work shall not be more than four (4) hours at any
given day;
"(2) A child fifteen (15) years of age but below eighteen (18) shall not be allowed to work for more than eight (8) hours a
day, and in no case beyond forty (40) hours a week;
(3) No child below fifteen (15) years of age shall be allowed
to work between eight o'clock in the evening and six o'clock in the morning of the following day and no child fifteen (15) years of age but below eighteen (18) shall be allowed to work between ten o'clock in the evening and six o'clock in the morning of the following day.
"Sec. 12-D. Prohibition Against Worst Forms of Child
Labor. - No child shall be engaged in the worst forms of child
labor. The phrase "worst forms of child labor" shall refer to any of the following:
"(1) All forms of slavery, as defined under the
"Anti-trafficking in Persons Act of 2003", or practices similar to
slavery such as sale and trafficking of children, debt bondage and serfdom and forced or compulsory labor, including recruitment of children for use in armed conflict; or
"(2) The use, procuring, offering or exposing of a child for
prostitution, for the production of pornography or for pornographic performances; or
"(3) The use, procuring or offering of a child for illegal or
illicit activities, including the production and trafficking of
dangerous drugs and volatile substances prohibited under existing laws; or
"(4) Work which, by its nature or the circumstances in which it is carried out, is hazardous or likely to be harmful to the
health, safety or morals of children, such that it:
"a) Debases, degrades or demeans the intrinsic worth and dignity of a child as a human being; or
"b) Exposes the child to physical, emotional or sexual abuse, or is found to be highly stressful psychologically or may prejudice morals; or
"c) Is performed underground, underwater or at dangerous heights; or
"d) Involves the use of dangerous machinery, equipment and tools such as power-driven or explosive power-actuated tools; or
"e) Exposes the child to physical danger such as, but not limited to the dangerous feats of balancing, physical strength or contortion, or which requires the manual transport of heavy loads; or
"f) Is performed in an unhealthy environment exposing the child to hazardous working conditions, elements, substances, co-agents or processes involving ionizing, radiation, fire, flammable substances, noxious components and the like, or to extreme temperatures, noise levels, or vibrations; or
"g) Is performed under particularly difficult conditions; or
"h) Exposes the child to biological agents such as bacteria, fungi, viruses, protozoans, nematodes and other parasites; or
"i) Involves the manufacture or handling of explosives and other pyrotechnic products."
Section 5. Section 14 of the same Act is hereby amended to read as follows:
"Sec. 14. Prohibition on the Employment of Children in
Certain Advertisements.
-No child shall be employed as a model in any advertisement directly or indirectly promoting alcoholic beverages, intoxicating drinks, tobacco and its byproducts, gambling or any form of violence or pornography."
BOOK THREE
CONDITIONS OF EMPLOYMENT Title I
WORKING CONDITIONS AND REST PERIODS Chapter I
HOURS OF WORK Art. 82. Coverage. The provisions of this Title
General Rule: Working Conditions and rest periods shall apply to employees in all establishments and undertakings whether for profit or not.
Exceptions:
1. government employees 2. managerial employees 3. non-agricultural field personnel 4. officers or members of managerial staff
5. domestic helpers and persons in the personal service of another, and
6. workers who are paid by results
Managerial employees – 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 – those 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.
Law prevails over a contract
The existence of a employer-employee relationship is not a matter of stipulation; it is a question of law.
Employer-employee relationship is also a question of fact – depends upon the fact of its case.
Employer-employee relationship may exist regardless of the nature of the activities involved. The kind of work is not definitive test of whether the worker is an employee or not. Employer – includes any person acting in the interest of an employer in relation to an employee… and an “employee” includes any individual employed by an employer (Art. 97) Elements of “tests” of employment relationship
“Right of control test” – where the person for whom the services are performed reserves a right to control not only the end to be achieved but also the means to be used in reaching such end.
The existing economic conditions prevailing between the parties (certain economic parameters)– ex. The inclusion of the employee in the payrolls, in determining the relationship of employer-employee relationship.
“four fold test”
a. the selection and engagement of the employee b. the payment of wages
c. the power of dismissal
d. the employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished
Evidence of Employment: Identification Card, Vouchers, SSS Registration, Memorandum
In administrative and quasi-judicial proceedings, “substantial
evidence” is sufficient as a basis for judgment on the
existence of employer-employee relationship. No particular form to evidence is required to prove the existence of such relationship. Any competence and relevant evidence to prove the relationship may be admitted. (domasig vs. NLRC, Sept. 16, 1996)
Modes of Compensation, Not a test of Employment Status Employment relationship is one thing, pay determination is another
Piece-rate, “boundary”, and “pakyaw” are merely
methods of pay computation and do not prove whether the payee is an employee or not.
“Pakiao” does not make petitioners independent contractors. Pakiao workers are considered employees as long as the employer exercises control over the means by which such workers are to perform their work. (Zamudio v. NLRC, March 25, 1990)
exercise of Employment Relationship Determined by Law, Not by Contract (even if the parties call their contract a “Contract of Lease of Services” under Art. 1642 of the Civil Code, the factual existence of an employer-employee relationship still prevail)
WHEN EMPLOYMENT RELATIONSHIP PRESENT 1. Salaried Insurance Agents
2. School Teachers – university controls the work of the members of its faculty)
3. Jeepney Driver, Taxi Driver, Barber –jeepney owners/operators exercise supervision and control over their drivers. The owner as holder of the certificate of public convenience must see to it that the driver must follows the route prescribed by the franchising authority and the rules promulgated as regards its operation. 4. Piece-rate Workers
5. Street-hired Cargadores (note: wielded the power of dismissal)
6. Fishermen
7. Workers in Movie Projects
(therefore entitled to the protection of the law and could not just be terminated without valid and justifiable reason)
1 LABOR UNION AND UNREGISTERED ASSOCIATION AS EMPLOYER (Bautista v. Inciong and Orlando Farm Grower v. NLRC.) 2 WHEN EMPLOYMENT RELATIONSHIP
ABSENT; JOB CONTRACTING OR INDEPENDENT CONTRACTOR) In labor only contracting the employer-employee relationship is between the workers and the enterprise to which they are supplied.