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BOX 1

What is labor law and what does it aim to achieve?


Labor Legislation consists of statues, regulations, and jurisprudence governing the relations between
capital and labor, by providing for certain employment standards and a legal framework for negotiating,
adjusting, and administering those standards and other incidents of employment.
Labor standards law is that which sets out the minimum terms, conditions and benefits of employees
that employers must provide or comply with and to which employees are entitled to as a right.
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.
Since labor laws are necessarily social legislation (those laws that provide particular kinds of
protection or benefits to society or segments thereof in furtherance of social justice), its aim and reason,
therefore, is social justice.
________________________________________________________________________________
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.

What are the constitutional mandates pertaining to labor and labor-management relations?
The state affirms labor as a primary social economic force. It shall protect the rights of workers and
promote their welfare. (Sec. 3, Art. XIII)
The basic rights of workers guaranteed by the Constitution are:
right to organize themselves
to conduct collective bargaining or negotiation with management
to engage in peaceful concerted activities, including to strike in accordance with law
to enjoy security of tenure
to work under humane conditions
to receive a living wage
to participate in policy and decision-making processes affecting their rights and benefits as
may be provided by law

Do Philippine labor laws meet international standards?


Yes, considering that the Philippines is a member of the International Labour Organization (ILO) the
UN specialized agency which seeks the promotion of social justice and internationally recognized human
and labor rights.

Are Philippine labor laws pro-labor?


Yes, since all doubts in the implementation and interpretation of labor laws shall be resolved in favor
of labor. Moreover, the working mans welfare should be the primordial and paramount consideration.
There is no doubt that the employer stands on a higher footing than the employee (1) there is greater
supply than demand for labor; and (2) the need for employment by labor comes from vital, and even
desperate, necessity. However, it should not be supposed that every labor dispute will be automatically
decided in favor of labor.

BOX 2
What law governs agrarian reform?
The Comprehensive Agrarian Reform Law (CARL) governs agrarian reform.
What are the objectives of agrarian reform?
The State shall, by law, undertake an agrarian reform program founded on the right of farmers and
regular farmworkers who are landless, to own directly or collectively the lands they till or, in the case of
other farmworkers, to receive a just share of the fruits thereof. To this end, the State shall encourage and
undertake the just distribution of all agricultural lands, subject to such priorities and reasonable retention
limits as the Congress may prescribe, taking into account ecological, developmental, or equity
considerations, and subject to the payment of just compensation. In determining retention limits, the
State shall respect the right of small landowners. The State shall further provide incentives for voluntary
land-sharing. (Art. XIII, Sec. 4, Constitution)

Art. 7 (Labor Code). Statement of objectives. Inasmuch as the old concept of land ownership by a
few has spawned valid and legitimate grievances that gave rise to violent conflict and social tension and
the redress of such legitimate grievances being one of the fundamental objectives of the New Society, it
has become imperative to start reformation with the emancipation of the tiller of the soil from his
bondage.

What process and conditions are observed to make a tenant-farmer an owner under the agrarian
reform program?
Art. 10. Conditions of ownership. No title to the land acquired by the tenant-farmer under Presidential
Decree No. 27 shall be actually issued to him unless and until he has become a full-fledged member of a
duly recognized farmers' cooperative.


BOX 3
What employment agencies are created to promote employment opportunities?
Effective allocation of manpower resources in local employment is assigned to the BLE (Bureau of
Local Employment) and to POEA (Philippine Overseas Employment Administration) for overseas
employment. Under the BLE are:
PESO (Public Employment Service Office) intended to serve as employment service and
information center in its area of operation; also provides training and educational guidance
and employment counseling services
WHIP a program which requires the DPWH an private contractors to hire 30% of skilled and
50% of unskilled labor requirements from the area where the project is being undertaken
How does the POEA protect and assist the OFWs?
Among the principal functions of the POEA are the formulation, implementation, and monitoring of
the overseas employment of Filipino workers and the protection of their rights to fair and equitable
employment practices. POEA participates also in the deployment of Filipino workers through government-
to-government hiring. They process vacationing workers, register sea-based workers, and participate in
government hiring through manpower pooling.
RPM Center
OWWA
Who has adjudicatory jurisdiction over claims by the OFWs?
RA No 8042 transferred the jurisdiction to the NLRC.
What significant amendments to the Labor Code are introduced by RA No. 8042?
Selective deployment the state shall deploy overseas Filipino workers only in countries where the rights
of Filipino migrant workers are protected. The government recognizes any of the following as a guarantee
on the part of the receiving country for the protection of rights of overseas Filipino workers:
it has existing labor and social laws protecting the rights of migrant workers
it is a signatory to multilateral conventions, declarations or resolutions relating to the protection
of migrant workers
it has concluded a bilateral agreement or arrangement with the government protecting the rights
of overseas Filipino workers
it is taking positive, concrete measures to protect rights of migrant workers
Are POEA-approved employment contracts immutable?
Yes, it can be subject to compromise.


BOX 4
What are the requirements and restrictions for the private sectors participation in recruitment and
placement of workers, local and overseas?
Requirements Restrictions

*only Filipino citizens or corporations, partnerships or *travel agencies and sales agencies of airline companies
entities owned and controlled by Filipinos by at least are prohibited to recruit
75%
*non-transferability of license or authority
*posting of cash and surety bonds

What acts or practices are prohibited in recruitment and placement activities of licensed recruiters?
Article 34 Prohibited Practices:
(a) To charge or accept directly or indirectly any amount greater than that 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 or
misrepresentation for the purpose of securing a license or authority under this 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 person or entity not to employ any worker who has not
applied for employment through his agency;
(f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality
or to the 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 representatives;
(h) To fail to file reports on the status of employment, placement vacancies, remittance of foreign
exchange earnings, separation 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 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
expiration of the same without the approval of the Department of Labor and Employment.
(j) To become officer or member of the Board of any corporation engaged in travel agency or to be
engaged directly or 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 this Code and its implementing rules and
regulations.

On what grounds and by which office may an employment license or recruitment permit be
cancelled?
The DOLE Secretary and POEA Administrator have concurrent jurisdiction to suspend or cancel a license on
the following grounds:
Under the Labor Code (art 35):
violation of rules and regulations
violation of the provisions of the Labor Code and other applicable laws, General Orders,
and Letter of Instructions
Under the POEA Rules:
charging a fee before the worker is employed or in excess of the authorized amount
doing recruitment in places outside its authorized areas
deploying workers without processing through the POEA
Substituting or altering employment contracts
Publishing job announcements without the POEAs prior approval

BOX 4

1. What are the requirements and restrictions for the private sectors participation in recruitment and
placement of workers?

Answer:
Requirements:
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. 27)
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. 28)
Private Employment Agency for local employment:
-minimum networth of P200,000 (single proprietorship/partnership)
-minimum paid-up capital of P500,000 (corporation)
Private Recruitment/Manning Agency for overseas employment:
-minimum capitalization of P2,000,000 (single proprietorship/partnership)
-minimum paid-up capital of P2,000,000 (corporation)
All applicants for license or authority shall post such cash or 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. 31)
Private Employment Agency for local employment:
-P25,000 cash bond
-P100,000 surety bond
Recruitment/Manning Agency for overseas employment:
-P1,000,000 escrow agreement, with confirmation of escrow deposit with an
accredited reputable bank
-P100,000 surety bond from a bonding company acceptable to the POEA and
accredited with the Insurance Commissioner
Restrictions:
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, nor may such 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. 29)
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. 26)
2. What acts or practices are prohibited in recruitment and placement activities of licensed recruiters?

Answer:
It shall be unlawful for any individual, entity, licensee, or holder of authority:
a) To charge or accept, directly or indirectly, any amount greater than that specified in the schedule of
allowable fees prescribed by the Secretary of Labor, 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 any false notice, testimony, information or document or commit any act of
misrepresentation for the purpose of securing a licensee or authority under this 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 the worker from oppressive terms and conditions of
employment;
e) To influence or to attempt to influence any person or entity not to employ any worker who has not
applied for employment through his agency;
f) To engage in the recruitment or placement of workers in jobs harmful to public health or morality or to
the dignity of the Republic of the Philippines;
g) To obstruct or attempt to obstruct inspection by the Secretary of Labor or by his duly authorized
representatives;
h) To fail to file reports on the status of employment, placement, vacancies, remittances of foreign
exchange earnings, separation from jobs, departures and such other matters or information as may be
required by the Secretary of Labor;
i) To substitute or alter employment contracts approved and verified by the Department of Labor from the
time of actual signing thereof by the parties up to and including the periods of expiration of the same
without the approval of the Secretary of Labor;
j) To become an officer or member of the Board of any corporation engaged in travel agency or to be
engaged directly or indirectly in the management of travel agency; and
k) To withhold or deny travel documents from applicant workers before departure for monetary or
financial considerations other than those authorized under this Code and its implementing rules and
regulations. (Art. 34)

3. On what grounds and by which office may an employment license or recruitment permit be cancelled?

Answer:
The grounds for imposition of administrative sanctions such as cancellation of license or
recruitment permit include:
a) engaging in act/s of misrepresentation for the purpose of securing a license or renewal thereof, such as
giving false testimonies or falsified documents
b) engaging in the recruitment and placement of workers in jobs harmful to public health or morality or to
the dignity of the Republic of the Philippines;
c) charging of any fee before employment is obtained for an applicant;
d) charging of any fee in an amount exceeding the allowable rate; and
e) obstructing inspections by DOLE

x x x the power to suspend or cancel any license or authority to recruit employees for overseas
employment is concurrently vested with the POEA and the Secretary of Labor. (People v. Diaz, 259 SCRA
441 [1996])

BOX 5

1. With the amendments made by the Migrant Workers and Overseas Filipinos Act (R.A. No. 8042), what
acts constitute illegal recruitment and who are the persons that can be held liable for it?

Answer:

Illegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring, or procuring workers and includes referring contract services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by a non-licensee or non-holder of
authority contemplated under Article 13 (f) of PD No. 442, as amended, otherwise known as the Labor
Code of the Philippines; Provided, That any such non-licensee or non-holder who, in any manner, offers or
promises for a fee employment abroad to two or more persons shall be deemed engaged so engaged. It
shall likewise include the following acts, whether committed by any person, whether a non-licensee, non-
holder, licensee or holder of authority:
a) To charge or accept directly or indirectly any amount greater than that 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 person or entity not to employ any worker who has
not applied for employment through his agency;
f) To engage in the recruitment or placement of workers in jobs harmful to public health or
morality or to the 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, remittance of
foreign exchange earnings, separation 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 or 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 reason as determined by the Department of Labor and
Employment; and
m) Failure to reimburse expenses incurred by the worker in connection with his documentation
and processing for purposes of deployment, in cases where the deployment does not actually take place
without the workers fault. (Sec. 6 (1), R.A. No. 8042)

2. Under what circumstances is illegal recruitment an offense involving economic sabotage?

Answer:
Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense
involving economic sabotage.
Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or
more persons conspiring or confederating with one another. It is deemed committed in large scale if
committed against three (3) or more persons individually or as a group.

3. Is the Secretary of Labor legally authorized to order the arrest of an illegal recruiter? May he order the
closure of an illegal recruitment office?

Answer:
The Secretary of Labor, not being a judge, may no longer issue search or arrest warrants. Hence,
the authorities must go through the judicial process. (Salazar v. Achacoso and Marquez, G.R. No. 81510,
March 14, 1990)
Article 38 (c) of the Labor Code has been declared unconstitutional, hence, null and void. Under
the Constitution, only a judge may issue warrants of search and arrest.
In a nutshell, the Secretary of Labor and Employment or his duly authorized representatives may
cause the lawful arrest of illegal recruiters either:
1. by virtue of a judicial warrant issued by an RTC, MTC or MCTC judge, as the case may be; or
2. without judicial warrant, under the provisions of Section 5, Rule 113 of the 1985 Rules on
Criminal Procedure, as amended; [revised, effective December 1, 2000, per A.M. No. 00-5-03-SC]
x x x the power of the Secretary or his duly authorized representatives to order the closure of
illegal recruitment establishments still subsists, the same being considered essentially administrative and
regulatory in nature. (Abalayan, p. 22)

BOX 6

1. Who are the foreign nationals that cannot work in the Philippines without an employment permit?

Answer:
Article 40 of the Labor Code requires only non-resident aliens to secure employment permit.
Resident aliens are not so required. (Almodiel v. NLRC, et al., G.R. No. 100641, June 14, 1993, 42 SCAD
354) For immigrants and resident aliens what is required is an Alien Employment Registration Certificate
(AERC).

2. Who are exempt from such requirement?

Answer:
The following categories of foreign nationals are exempt from securing an employment permit:
All members of the diplomatic service and foreign government officials accredited by and with
reciprocity arrangement with the Philippine government
Officers and staff of international organizations of which the Philippine government is a member,
and their legitimate spouses desiring to work in the Philippines
Foreign nationals elected as members of the Governing Board who do not occupy any other
position, but have only voting rights in the corporation
All foreign nationals granted exemption by law
Owners and representatives of foreign principals whose companies are accredited by the
Philippine Overseas Employment Administration (POEA), who come to the Philippines for a
limited period and solely for the purpose of interviewing Filipino applicants for employment
abroad
Foreign nationals who come to the Philippines to teach, present and/or conduct research studies
in universities and colleges as visiting, exchange or adjunct professors under formal agreements
between the universities or colleges in the Philippines and foreign universities or colleges; or
between the Philippine government and foreign government; provided that the exemption is on a
reciprocal basis and
Resident foreign nationals [Department Order No. 75, Rule I (2)]

BOX 7

1. What is the TESDA and what are its responsibilities?

Answer:
The TESDA or Technical Education and Skills Development Authority replaced and absorbed the
National Manpower and Youth Council (NYMC), the Bureau of Technical and Vocational Education (BTVE)
and the personnel and functions pertaining to technical-vocational education in the regional offices of the
Department of Education, Culture and Sports (now DepEd) and the apprenticeship program of the Bureau
of Local Employment of the Department of Labor Employment.
The TESDA shall primarily be responsible for formulating, continuing, coordinating and fully
integrating technical education and skills development policies, plans and programs taking into
consideration the following:
a) The state policy declared herein of giving new direction and thrusts to efforts in developing the
quality of Filipino human resource through technical education and skills development;
b) The implementation of the above-mentioned policy requires the coordination and cooperation
of policies, plans and programs of different concerned sectors of Philippine society;
c) Equal participation of representatives of industry groups, trade associations, employers,
workers and government shall be the rule in order to ensure that urgent needs and recommendations are
readily addressed; and
d) Improved linkages between industry, labor and government shall be given priority in the
formulation of any national-level plan.
The Board shall have the following powers:
1) promulgate, after due consultation with industry groups, trade associations, employers,
workers, policies, plans, programs and guidelines as may be necessary for the effective implementation of
this Act;
2) organize and constitute various standing committees, subsidiary groups, or technical working
groups for efficient integration, coordination and monitoring technical education and skills development
programs at the national, regional, and local levels;
3) enter into, make, execute, perform and carry out domestic and foreign contracts subject to
existing laws, rules, and regulations;
4) restructure the entire subsector consisting of all institutions and programs involved in the
promotion and development of middle-level manpower through upgrading, merger and/or phase-out
following a user-led strategy;
5) approve trade skills standards and trade tests as established and conducted by private
industries;
6) establish and administer a system of accreditation of both public and private institutions;
7) establish, develop and support institutions trainors training and/or programs;
8) lend support and encourage increasing utilization of the dual training system as provided for by
Republic Act No. 7696;
9) exact reasonable fees and charges for such tests and trainings conducted and retain such
earnings for its own use, subject to guidelines promulgated by the Authority;
10) allocate resources, based on the Secretariats recommendations, for the programs and
projects it shall undertake pursuant to approved National Technical Education and Skills Development
Plan;
11) determine and approve systematic funding schemes such as the Levy and Grant scheme for
technical education and skills development purposes;
12) create, when deemed necessary, an Advisory Committee which shall provide expert and
technical advice to the Board to be chosen from the academe and the private sector; Provided, That in
case the Advisory Committee is created, the Board is hereby authorized to set aside a portion of its
appropriation for its operation; and
13) perform such other duties and functions necessary to carry out the provisions of this Act
consistent with the purposes of the creation of TESDA. (Sec. 8, R.A. No. 7796 otherwise known as TESDA
Act of 1994)
The Authority shall review and recommend action to concerned authorities on proposed
technical assistance programs and grants-in-aid for technical education or skills development, or both,
including those which may be entered into between the Government of the Philippines and other nations,
including international and foreign organizations, both here and abroad. (Sec. 9, ibid.)

2. How may the success or failure of TESDA be measured?

Answer:
Every five (5) years, after the effectivity of the Act, an independent review panel composed of
three (3) persons appointed by the President shall review the performance of the Authority and shall
make recommendations based on its findings to the President and to both Houses of Congress. (Sec. 35,
ibid.)
The success or failure of TESDA may be measured by checking whether the policy of the TESDA
Act of 1994 has been observed, carried out and realized: to provide relevant, accessible, high quality and
efficient technical education and skills development in support of the development of high quality Filipino
middle-level manpower responsive to and in accordance with Philippine development goals and priorities;
to encourage active participation of various concerned sectors, particularly private enterprises, being
direct participants in and immediate beneficiaries of a trained and skilled workforce, in providing technical
education and skills development opportunities.

BOX 8

1. Obviously, the law on conditions of employment cannot apply if employer-employee relationship does
not exist between the parties. In law, who is considered an employee? an employer?

Answer:
Employee- one who is engaged in the service of another, who performs services for another;
who works for salary or wages
-his work is subject to control of the employer not only as to the result but the manner
and means of doing it
-a salaried person working for another who controls or supervises the means, manner or
method of doing the work.
Employer- one who employs the services of another; one for whom employees work and who
pays their wages or salaries.
-one for whom a person works and who controls or supervises the means, manner or
method of doing the work and from whom the worker gets his salary.

2. What are the implications or consequences of the existence of employment relationship? Who are the
employees that are excluded from the coverage of the law on employment conditions?

Answer:
The implications or consequences of the existence of employment relationship are that the
employee shall be entitled to the protection of the law and could not just be terminated without valid and
justifiable reason. (Great Pacific Life Assurance Corporation v. Judico, G.R. No. 73887, December 21, 1989)
The existence of an employer-employee relationship spawns obligations connected with workmens
compensation, social security, medicare, termination pay, and unionism. (Brotherhood Labor Unity
Movement of the Philippines, et al. v. Zamora, et al., G.R. No. 48645, January 7, 1987) It also implicates
that the employer and employee are bound to observe and comply with the provisions in the Labor Code
pertaining to normal hours of work, meal periods, night shift differential, overtime work, weekly rest
periods, holidays, service incentive leaves and service charges, payment of wages, minimum wage rates,
among others.
The employees that are excluded from the coverage of the law on employment conditions:
Government employees
Managerial employees (includes officers or members of the managerial staff)
Field personnel (non-agriculture 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
Members of the family of the employer dependent on him for support
Domestic helpers
Persons in the personal service of another
Workers paid by results (includes those who are paid on piece-rate work, takay, pakyaw, or task
basis

3. What are the rights and responsibilities of the employer and the employee as regards determination
and observance of work hours?

Answer:
The rights and responsibilities of the employee and employer are enunciated in the following
provisions:

Article 83. The normal hours of work of any employee shall not exceed eight (8) hours a day.
Health personnel in cities and municipalities with a population of at least one million (1,000,000)
or in hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office hours
for eight (8) hours a day, for five days a week, exclusive of time for meals, except where the exigencies of
the service require that such personnel work for six (6) days or forty eight (48) hours, in which case they
shall be entitled to an additional compensation of at least thirty percent (30%) of their regular wage for
work on the sixth day. x x x
Article 84. Hours worked shall include a) all time during which an employee is required to be on
duty or to be at a prescribed workplace, and b) all time during which an employee is suffered or permitted
to work.
Rest periods of short duration during working hours shall be counted as hours worked.

Article 85. Subject to the regulations as the Secretary of Labor may prescribe, it shall be the duty
of every employer to give his employees not less than sixty (60) minutes time-off for their regular meals.

Article 86. Every employee shall be paid a night shift differential of not less than ten percent
(10%) of his regular wage for each hour of work performed between ten oclock in the evening and six
oclock in the morning.

Article 87. Work may be performed beyond eight (8) hours a day provided that the employee is
paud for the overtime work an additional compensation equivalent to his regular wage plus at least
twenty-five percent (25%) thereof. Work performed beyond eight hours on a holiday or rest day shall be
paid an additional compensation equivalent to the rate of the first eight hours on a holiday or rest day plus
at least thirty percent (30%) thereof.

Article 88. Undertime work on any particular day shall not be offset by overtime work on any
other day. Permission given to the employee to go on leave on some other day of the week shall not
exempt the employer from paying the additional compensation required in this Chapter.

Article 89. Any employee may be required by the employer to perform overtime work in any of
the following cases:
a) When the country is at war or when any other national or local emergency has been declared
by the National Assembly or the Chief Executive;
b) When it is necessary to prevent loss of life or property or in case of imminent danger to public
safety due to an actual or impending emergency in the locality caused by serious accidents, fire, flood,
typhoon, earthquake, epidemic, or other disaster or calamity;
c) When there is urgent work to be performed on machines, installations, or equipment, in order
to avoid serious loss or damage to the employer or some other cause of similar nature;
d) When the work is necessary to prevent loss or damage to perishable goods; and
e) Where the completion or continuation of the work started before the eighth hour is necessary
to prevent serious obstruction or prejudice to the business or operations of the employer.
Any employee required to render overtime work under this Article shall be paid the additional
compensation required in this Chapter.

Article 90. For purposes of computing overtime and other additional remuneration as required by
this Chapter, the regular wage of an employee shall include the cash wage only, without deduction on
account of facilities provided by the employer.

4. In law, what are considered hours worked? Which ones are unworked, hence, not compensable? Is
lunch break compensable? What travel hours should be paid?

Answer:
Hours worked shall include a) all time during which an employee is required to be on duty or to
be at a prescribed workplace, and b) all time during which an employee is suffered or permitted to work.
Rest periods of short duration during working hours shall be counted as hours worked. (Art. 84)

The following are considered worked;


Waiting time spent by an employee if waiting is considered an integral part of his work or if the
employee is required or engaged by an employer to wait (engaged to wait)
Meal time if employee is not completely freed or relieved from performing his duties
Sleeping time if it is subject to serious interruption or takes place under conditions substantially
less desirable than would be likely to exist at the employees home
Being on call where employee is required to remain on call on the employers premises or so
close thereto that he cannot use the time effectively for his own purposes
When employee receives an emergency call outside of his regular working hours and is required
to travel to his regular place of business or some other work site (abnormal home-to-work
travel)
Travel that is all in the days work
Travel away from home
Attendance at lectures, meetings, training programs provided the following criteria are not met:
1) attendance is outside of employees regular working hours, 2) voluntary 3) the employee does
not perform any productive work during such attendance
Grievance meeting during the time the employees are required by the employees to be on the
premises
Semestral break for regular full-time monthly-paid teachers in a private school
Work hours for seamen for work in actual service beyond eight hours
Lunch periods spent predominantly for the employers benefit and cannot be utilized in the
employees own interests
Meal time breaks between continuous work shifts
Shortened meal time when employee cannot eat because he is still working
Meal time of less than 20 minutes

The following are considered unworked:


Waiting time spent by an employee if waiting is not considered an integral part of his work
(waiting to be engaged)
Meal time if employee is completely freed from duties during his meal period even though he
remains in the workplace
Sleeping time if there is an opportunity for comparatively uninterrupted sleep under fairly
desirable conditions, even if the employee is required to remain on or near the employers
premises and must hold himself in readiness for a call to action employment
Where work is not continuous, when the laborer can leave his work and rest completely
Normal travel from home to work
Attendance at lectures, meetings, training programs if attendance is outside of employees
regular working hours, voluntary and the employee does not perform any productive work during
such attendance
When seaman ceases to work even while on board the ship
Shortened meal break upon employees request so that they can leave work earlier than the
previously established schedule
Lunch breaks are not compensable except in cases where the lunch period or meal time is
predominantly spent for the employers benefit and cannot be utilized in the employers own interests, or
where it is less than 60 minutes, or where work is continuous for several shifts (for purposes of overtime
compensation)

Travel hours that should be paid:


when employee receives an emergency call outside of his regular working hours and is required
to travel to his regular place of business or some other work site (abnormal home-to-work
travel)
travel that is all in the days work
travel away from home

5. Is rendition of overtime work an obligation?

Answer:
Rendition of overtime work is not an obligation. The use of the word may in Article 87 means
that rendition of overtime work is not compulsory and is thus optional on the part of the worker. It is
rather dependent on the employees will and according to his own volition. The employer, however, may
legally compel him to render overtime work in any of the following cases:
a) When the country is at war or when any other national or local emergency has been declared
by the National Assembly or the Chief Executive;
b) When it is necessary to prevent loss of life or property or in case of imminent danger to public
safety due to an actual or impending emergency in the locality caused by serious accidents, fire, flood,
typhoon, earthquake, epidemic, or other disaster or calamity;
c) When there is urgent work to be performed on machines, installations, or equipment, in order
to avoid serious loss or damage to the employer or some other cause of similar nature;
d) When the work is necessary to prevent loss or damage to perishable goods; and
e) Where the completion or continuation of the work started before the eighth hour is necessary
to prevent serious obstruction or prejudice to the business or operations of the employer. (Art.89)
The Rules Implementing the Labor Code also authorizes compulsory overtime work when it is
necessary to avail of favorable weather or environmental conditions where performance or quality of
work is dependent thereon. (Sec. 10, Rule I, Book III, Rules Implementing the Labor Code)
The employer should thus pay his workers who render overtime work the appropriate additional
overtime compensation for such work.
BOX 9:

1. A.) When is an employees rest day?

a.) An employees rest day will be among the following:

-Every employer shall give his employees a rest period of not less than 24 consecutive hours after every 6
consecutive normal work days.

-If business is open on Sundays/holidays, rest day may be scheduled on another day.

-Preference of employee as to his rest day should be respected if based on religious grounds.

-Waiver of compensation for work on rest days and holidays is not valid.
2. When may an employer compel his employees to render work on a rest day?

a. In case of actual or impending emergencies caused by serious accident, fire, flood, typhoon,
earthquake, epidemic or other disaster or calamity, to prevent loss of life and property, or in case of force
majeure or imminent danger to public safety; chanrobles virtual law library

b. In case of urgent work to be performed on machineries, equipment, or installations, to avoid serious


loss which the employer would otherwise suffer;

c. In the event of abnormal pressure of work due to special circumstances, where the employer cannot
ordinarily be expected to resort to other measures;

d. To prevent serious loss of perishable goods;

e. Where the nature of the work is such that the employees have to work continuously for seven (7) days
in a week or more, as in the case of the crew members of a vessel to complete a voyage and in other
similar cases; and

f. When the work is necessary to avail of favorable weather or environmental conditions where
performance or quality of work is dependent thereon.
BOX 10

Where an employee is made or permitted to work on his scheduled rest day, he shall be paid an
additional compensation of at least thirty percent (30%) of his regular wage. An employee shall be
entitled to such additional compensation for work performed on Sunday only when it is his
established rest day.
When the nature of the work of the employee is such that he has no regular workdays and no regular
rest days can be scheduled, he shall be paid an additional compensation of at least thirty percent
(30%) of his regular wage for work performed on Sundays and holidays.
Work performed on any special holiday shall be paid an additional compensation of at least thirty
percent (30%) of the regular wage of the employee. Where such holiday work falls on the employees
scheduled rest day, he shall be entitled to an additional compensation of at least fifty per cent (50%)
of his regular wage.
Where the collective bargaining agreement or other applicable employment contract stipulates the
payment of a higher premium pay than that prescribed under this Article, the employer shall pay such
higher rate.

Every worker shall be paid his regular daily wage during regular holidays, except in retail and service
establishments regularly employing less than ten (10) workers;

The employer may require an employee to work on any holiday but such employee shall be paid a
compensation equivalent to twice his regular rate; and

As used in this Article, "holiday" includes: New Years Day, Maundy Thursday, Good Friday, the ninth of
April, the first of May, the twelfth of June, the fourth of July, the thirtieth of November, the twenty-
fifth and thirtieth of December and the day designated by law for holding a general election.

What is service incentive leave? Is a part time worker entitled to SIL to the same extent as a full
timer?
Every worker shall be paid his regular daily wage during regular holidays, except in retail and
service establishments regularly employing less than ten (10) workers;

The employer may require an employee to work on any holiday but such employee shall be
paid a compensation equivalent to twice his regular rate; and

As used in this Article, "holiday" includes: New Years Day, Maundy Thursday, Good Friday,
the ninth of April, the first of May, the twelfth of June, the fourth of July, the thirtieth of
November, the twenty-fifth and thirtieth of December and the day designated by law for
holding a general election.

The Implementing Rules and Regulations of the Labor Code, as amended, provides that every employee
who has rendered at least one year of service shall be entitled to a yearly SIL of five days with pay. Thus, a
part time worker is entitled to SIL whether the service within 12 months is continuous or broken or where
the working days in the employment contract as a matter of practice or policy is less than 12 months. The
commutation shall be proportionate to the daily work rendered and the regular salary.

Aside from SIL what kinds of leave are granted by law

Sick leave

Vacation leave

Paternity leave

Maternity leave

Solo parent leave

Battered woman leave

60 day special leave under the Magna Carta for Women

BOX 11

What is wage? What does it include? To determine whether ones wage meets the legal
minimum, should non-cash benefits be included in the computation?

Wage paid to an employee shall mean the remuneration or earnings, however designated,
capable of being expressed in terms of money, whether fixed or ascertained on a certain time,
task, piece, or commission basis, or other method of calculating the same, which is payable by an
employer to an employee under a written or unwritten contract of employment for work done or
to be done, or for services rendered or to be rendered and includes the fair reasonable value, as
determined by the Secretary of Labor, of board, lodging, or other facilities customarily furnished
by the employer to the employee. Fair reasonable value shall not include any profit to the
employer or to any person affiliated with the employer. (Labor Code, Article 97 (f))

Wage includes sales commissions (see Songco, et. al. vs NLRC, GR nos 50999-51000, March 23,
1990) as well as facilities (articles or services for the benefit of the employee or his family but
shall not include tools of the trade or articles or service primarily for the benefit of the employer
or necessary to the conduct of the employers business) or commodities (employer may provide
them but he may deduct their values from the employees wages).

*** For meals and snacks: employer may deduct from the wages not more than 70% of the value
of the meals and snacks enjoyed by employees, provided that such deduction is authorized in
writing by the employees. The remaining 30% of the value has to be subsidized by the employer
(Implementing Rule (Book III, Rule VII, Sec. 4)

*** For lodging facility: cost of operation and maintenance, including adequate depreciation plus
reasonable allowance (but not more than 5 1/2% interest on the depreciated amount of capital
invested by the employer) provided that if the total so computed is more than the fair rental
value, the fair rental value shall be the reasonable cost of the operation and maintenance.

Non-cash benefits shall be included in the determination of compliance with the legal minimum
wage when such are capable of being expressed in money terms, provided that such non-cash
benefits are paid by an employer to an employee for work done or services rendered. In such
case, the fair reasonable value shall be the basis for its amount to be included in the wage
computation. (Own answer ko lang based on the definition of wage)

Facilities are wage-deductible, supplements are not. How are they differentiated?

Supplements constitute extra remuneration or special privileges or benefits given to or received


by the laborers over and above their ordinary earnings or wages. Facilities are items of expense
necessary for the laborers and his familys existence and subsistence so that by express provision
of law, they form part of the wage and when furnished by the employer are deductible
therefrom. (Atok-Big Wedge Assn. vs Atok-Big Wedge Co., 97 Phil. 294 as cited in State Marine
Corp and Royal Line, Inc. vs Cebu Seamens Association, Inc., GR No. L-12444, February 28, 1963)

The term facilities shall include articles or services for the benefit of the employee or his family
but shall not include tools of the trade or articles or service primarily for the benefit of the
employer or necessary to the conduct of the employers business. (Implementing Rules, Book III,
Rule VII, Sec. 5)

What establishments may be exempted from observance of the minimum wage law?

This Title (Title II: WAGES) shall not apply to farm tenancy or leasehold, domestic
service and persons working in their respective homes in needle work or in any cottage
industry duly registered in accordance with law. (Labor Code, Article 98)

Who are excluded from the coverage of the minimum wage law?
a) Household or domestic helpers;
b) Persons employed in the personal service of another;
c) Workers of registered Barangay Micro Business Establishments (BMBEs)
(2014 Handbook on Workers Statutory Monetary Benefits)

BOX 12

1. How is the regionalization of minimum wage justified?

The statutory minimum wage is the lowest rate fixed by law that an employer can pay his
workers. The bare cost of living in every region is different; some regions may be economically
progressive, while this may not be the case for the others. It is because of this disparity that a
need for regionalization arises. To impose a uniform minimum wage on all regions without taking
stock of the economic realities that prevail in each region would be unfair and oppressive to
employers in regions where the bare cost of living is not as exacting as in other developed
regions. In other words, there is a valid distinction that justifies the regionalization of minimum
wage.

2. What is the rule on non-diminution of benefits? Does it apply to benefits negotiated through a CBA or
to conditional benefits such as bonus?

Article 100 of the Labor Code States that: Nothing in this Book shall be construed to eliminate or
in any way diminish supplements, or other employee benefits being enjoyed at the time of
promulgation of this Code. So that the rule against diminution of supplements or benefits may
apply, it must be shown that: 1. The grant of the benefit is founded on a policy or has ripened into
a practice over a long period; 2. The practice is consistent and deliberate; 3. The practice is not
due to error in the construction or application of a doubtful or difficult question of law; and 4.
The diminution or discontinuance is done unilaterally by the employer.
CBA. It does not apply to benefits negotiated through a CBA because as products of a bilateral
contract, the benefits can only be eliminated or diminished bilaterally. What the law forbids is
elimination or modification done unilaterally.
Conditional benefits (e.g. bonus). Article 100 does not apply to a benefit whose grant depends on
the existence of certain conditions, so that the benefit is not demandable if those preconditions
are absent. A bonus is an act of generosity; it is not an enforceable and demandable obligation.
However, it may be so when it is made part of the wage or salary or compensation.

3. What is the 13th month pay rule and who are entitled to it? On what basis is it computed? Are
commissions part of the pay?

The 13th month pay is a statutory grant (i.e. PD 851) which is another source of augmented
income. It obliges the employer to pay the employees for that imaginary month. All rank-and-file
employees, regardless of salary rate, are entitled to this benefit. However, managerial and
supervisory employees do not enjoy this statutory benefit.
The IRR provides that 13th month pay shall mean 1/12 (one-twelfth) of the basic salary of an
employee within a calendar year. Basic salary shall include all remunerations or earnings paid by
an employer to an employee for services rendered but may not include COLA, profit-sharing
payments and all allowances and monetary benefits which are not considered integrated as part
of the regular or basic salary or the employee at the time of the promulgation of PD 851.
The inclusion of commissions depends on their nature. If they may be considered part of the
basic salary, they should be included in the computation. If they are not an integral part of the
basic salary, the should be excluded.

4. On what conditions are wages calculated according to work output, instead of time spent, lawful?

Article 101 states: The Secretary of Labor and Employment shall regulate the payment of
wages by results, including pakyao, piecework, and other non-time work, in order to ensure
the payment of fair and reasonable wage rates, preferably through time and motion studies
or in consultation with representatives of workers and employers organizations. For one,
the output-to-pay ratio must be fair and reasonable. As well, the employees must be
compensated in accordance with the minimum wage requirements. (See page 317 of the
Book [2010 ed] for the IRR provision)
5. What statutory benefits are piece-rate workers entitled to?

The applicable statutory minimum daily rate


Yearly service incentive leave of 5 days with pay
Night shift differential pay
Holiday pay
Meal and rest periods
Overtime pay (conditional)
Premium pay (conditional)
13th month pay
Other benefits granted by law, by individual or collective agreement or company policy or
practice.

BOX 13

BOOK 3, CHAPTER 3

PAYMENT OF WAGES

Is it lawful to pay wages only once a month? May the wages be paid in form of goods such as
phone cards?

No, under Article 103, wages shall be paid at least once every two (2) weeks or twice a month at
intervals not exceeding sixteen (16) days. However, if on account of force majeure or circumstances
beyond the employers control, payment of wages on or within the time herein provided cannot be made,
the employer shall pay the wages immediately after such force majeure or circumstances have ceased. No
employer shall make payment with less frequency than once a month.

No, wages may not be paid in the form of goods such as phone cards. Under Article102, no
employer shall pay the wages of an employee by means of promissory notes, vouchers, coupons, tokens,
tickets, chits, or any object other than legal tender, even when expressly requested by the employee.

What is independent contracting in contrast to labor-only contracting? What does the latter
consist of and why does the law prohibit it?

In independent contracting, the subject of the contract is the performance of a job and the
contractor is an independent businessman who is capable of doing the job by his own means and
methods.

Under Article 106, there is "labor-only" contracting where the person supplying workers to an
employer does not have substantial capital or investment in the form of tools, equipment, machineries,
work premises, among others, and the workers recruited and placed by such person are performing
activities which are directly related to the principal business of such employer. In such cases, the person or
intermediary shall be considered merely as an agent of the employer who shall be responsible to the
workers in the same manner and extent as if the latter were directly employed by him.

Independent contracting is legitimate or valid. On the other hand, labor-only contracting is


prohibited because it is an attempt to evade the obligations of an employer.

Other than labor-only contracting, what forms or acts of labor contracting are disallowed?

Under Section 6 of D.O. No. 18-02, the following are disallowed:

(a) Contracting out of a job, work or service when not done in good faith and not justified by the
exigencies of the business and the same results in the termination of regular employees and reduction of
work hours or reduction or splitting of the bargaining unit;

(b) Contracting out of work with a "cabo" as defined in Section 1 (ii), Rule I, Book V of these
Rules. "Cabo" refers to a person or group of persons or to a labor group which, in the guise of a labor
organization, supplies workers to an employer, with or without any monetary or other consideration
whether in the capacity of an agent of the employer or as an ostensible independent contractor;

(c) Taking undue advantage of the economic situation or lack of bargaining strength of the contractual
employee, or undermining his security of tenure or basic rights, or circumventing the provisions of regular
employment, in any of the following instances:chanroblesvirtuallawlibrary

(i) In addition to his assigned functions, requiring the contractual employee to perform functions
which are currently being performed by the regular employees of the principal or of the
contractor or subcontractor;

(ii) Requiring him to sign, as a precondition to employment or continued employment, an


antedated resignation letter; a blank payroll; a waiver of labor standards including minimum
wages and social or welfare benefits; or a quitclaim releasing the principal, contractor or
subcontractor from any liability as to payment of future claims; and

(iii) Requiring him to sign a contract fixing the period of employment to a term shorter than the
term of the contract between the principal and the contractor or subcontractor, unless the latter
contract is divisible into phases for which substantially different skills are required and this is
made known to the employee at the time of engagement;

(d) Contracting out of a job, work or service through an in-house agency which refers to a contractor or
subcontractor engaged in the supply of labor which is owned, managed or controlled by the principal and
which operates solely for the principal;

(e) Contracting out of a job, work or service directly related to the business or operation of the principal by
reason of a strike or lockout whether actual or imminent;

(f) Contracting out of a job, work or service being performed by union members when such will interfere
with, restrain or coerce employees in the exercise of their rights to self organization as provided in Art. 248
(c) of the Labor Code, as amended.

In summary, the following are prohibited since these arrangements violate public policy (Second
Set of Prohibitions):

Contracting that terminates the employment of regular employees, or reduces their work hours,
or reduces or splits a bargaining unit, if such contracting out is not done in good faith and not
justified by business exigencies

Contracting with a cabo

Contracting with in-house agency

Contracting because of a strike or lockout

Contracting that constitutes ULP under Article 248

The exploitative acts under Section 6(c) of D.O. No. 18-02 are also prohibited (Third Set of
Prohibitions).

May an indirect employer be held answerable for an illegal dismissal done by the direct
employer?

No. The Court has interpreted the liability of the indirect employer as a qualified or limited
liability. This means that if the liability if for failure to pay minimum wage or service incentive leave or
other benefits derived from or provided by law, the indirect employer is equally liable with the contractor
as if the former were the direct employer. But if the liability is invested with punitive character, such as an
award for backwages and separation pay due to illegal dismissal of the contractors employee, the liability
should be solely that of the contractor in the absence of proof that the indirect employer conspired with
the contractor in the commission of the illegal dismissal.

BOX 14

1. What wage deduction are legally allowed?

Wage deduction allowed are those enumerated under Art. 113 of the Labor Code which states that, "No
employer , in his own behalf or on behalf of any person, shall make any deduction from the wages of his
employees, except:

(a) In cases where the worker is insured with his consent by the employer, and the deduction is to
recompense the employer for the amount paid by him as premium on the insurance;

(b) For union dues, in cases where the right of the worker or his union to check-off has been recognized
by the employer or authorized in writing by the individual worker concerned; and

(c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor.

There are also deductions which are authorized by law, such as:

a. Deduction for value meals and other facilities


b. In cases where the employee is undebted to the employer, where such indebtedness has become due
and demandable.

c. In court awards, wages may be the subject of execution or attachment, but only for debts incurred for
food, shelter, clothing and medical attendance.

d. Withholding tax

e. Salary deductions if a member of legally established cooperative.

f. SSS, medicare, and Pag-ibig contributions.

Under implementing rules, employees payment of obligations to a third person may also be
deducted provided that this was authorized by the employee in writing. Deductions for absences and for
reduced worked days are also allowed.

2. May an employer deduct form the employees salary the cost of company property lost or damaged by
the employee?

According to implementing rules, payment for lost or damaged equipment is deductible from the
employee's salary if four conditions are met, namely:

(a) the employee is clearly shown to be responsible for the loss or damages;

(b) the employee should be given ample opportunity to show case why deduction should not be
made;

(c) the amount of deduction is fair and reasonable and shall not exceed the actual loss or
damages;

(d) the deduction from the employees wage does not exceed 20 percent of the employee's wage
in a week.

3. May labor standards violations justify a strike?

As a general rule, a wage violation is unlawful and may be pursued in a money claim but not
through strike, unless they constitutes or fall Unfair Labor Practice (ULP). In the latter case, strike is valid.

BOX 15

What is NWPC?
National Wages and Productivity Commission

Attached to the DOLE

RTWPB?

Regional Tripartite Wages and Productivity Boards

Implemented by the respective regional offices of the Department of Labor and Employment
within their territorial jurisdiction

What are their respective authorities as regards wage determination?

NWPC

The Commission shall have the following powers and functions:

To act as the national consultative and advisory body to the President of the Philippines
and Congress on matters relating to wages, incomes and productivity;

To formulate policies and guidelines on wages, incomes and productivity improvement


at the enterprise, industry and national levels;

To prescribe rules and guidelines for the determination of appropriate minimum wage
and productivity measures at the regional, provincial, or industry levels;

To review regional wage levels set by the Regional Tripartite Wages and Productivity
Boards to determine if these are in accordance with prescribed guidelines and national
development plans;

To undertake studies, researches and surveys necessary for the attainment of its
functions and objectives, and to collect and compile data and periodically disseminate
information on wages and productivity and other related information, including, but not
limited to, employment, cost-of-living, labor costs, investments and returns;

To review plans and programs of the Regional Tripartite Wages and Productivity Boards
to determine whether these are consistent with national development plans;

To exercise technical and administrative supervision over the Regional Tripartite Wages
and Productivity Boards;

To call, from time to time, a national tripartite conference of representatives of


government, workers and employers for the consideration of measures to promote wage
rationalization and productivity; and
To exercise such powers and functions as may be necessary to implement this Act.

Prescribed rules and guidelines for determination of appropriate minimum wage and productivity
measures at the regional, provincial and industry levels.

May review wage levels set by RTWPBs.

Wage order by RTWPBs do not need prior approval from NWPC

What needs approval is the IRR which the RTWPB has to prepare within 10 days from
issuance of wage order

Appeal to any Wage order within 10 days after publication of the order

RTWPB

The Regional Boards shall have the following powers and functions in their respective territorial
jurisdictions:

To develop plans, programs and projects relative to wages, incomes and productivity
improvement for their respective regions;

To determine and fix minimum wage rates applicable in their regions, provinces or
industries therein and to issue the corresponding wage orders, subject to guidelines
issued by the Commission;

To undertake studies, researches, and surveys necessary for the attainment of their
functions, objectives and programs, and to collect and compile data on wages, incomes,
productivity and other related information and periodically disseminate the same;

To coordinate with the other Regional Boards as may be necessary to attain the policy
and intention of this Code;

To receive, process and act on applications for exemption from prescribed wage rates as
may be provided by law or any Wage Order; and

To exercise such other powers and functions as may be necessary to carry out their
mandate under this Code.

to determine and fix minimum wage rates applicable in their regions

to issue the corresponding wage orders, subject to guidelines issued by the NWPC.

What factors or criteria are considered in determining a regions minimum wage standard?

Art. 124-

The demand for living wages;

Wage adjustment vis--vis the consumer price index;


The cost of living and changes or increases therein;

The needs of workers and their families;

The need to induce industries to invest in the countryside;

Improvements in standards of living;

The prevailing wage levels;

Fair return of the capital invested and capacity to pay of employers;

Effects on employment generation and family income; and

The equitable distribution of income and wealth along the imperatives of economic and social
development.

What obligations, if any, does an employer have when salaries are distorted by compliance with a wage
order?

Where the application of any prescribed wage increase by virtue of a law or wage order issued by any
Regional Board results in distortions of the wage structure within an establishment,

the employer and the union shall negotiate to correct the distortions.

Any dispute arising from wage distortions shall be resolved

through the grievance procedure under their collective bargaining agreement

and, if it remains unresolved,

through voluntary arbitration.

Unless otherwise agreed by the parties in writing, such dispute shall be decided by the voluntary
arbitrators within ten (10) calendar days from the time said dispute was referred to voluntary arbitration.

In cases where there are no collective agreements or recognized labor unions, the employers and workers
shall endeavor to correct such distortions.

Any dispute arising therefrom shall be settled through the National Conciliation and Mediation Board and,
if it remains unresolved after ten (10) calendar days of conciliation, shall be referred to the appropriate
branch of the National Labor Relations Commission (NLRC). It shall be mandatory for the NLRC to conduct
continuous hearings and decide the dispute within twenty (20) calendar days from the time said dispute is
submitted for compulsory arbitration.
The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of any
increase in prescribed wage rates pursuant to the provisions of law or wage order.

As used herein, a wage distortion shall mean a situation where an increase in prescribed wage rates
results in the elimination or severe contraction of intentional quantitative differences in wage or salary
rates between and among employee groups in an establishment as to effectively obliterate the distinctions
embodied in such wage structure based on skills, length of service, or other logical bases of differentiation.
BOX 16

1. Labor laws are enforced and administered largely through DOLEs regional offices. How is this
administrative authority exercised?

At the regional level, 5 regional offices enforce the labor laws, namely:

The DOLE regional office, headed by a regional director, including 5 divisions, to wit:
administrative division, labor standards enforcement division, industrial relations division,
workers amelioration and welfare division, employment promotion division

TESDA

RAB (regional arbitration branch) of the NLRC which handles compulsory arbitration cases
affecting labor and management, aside from enforcing decisions, awards or orders of the
NLRC.

NCMB (national and conciliation mediation board) which has absorbed the conciliation,
mediation and voluntary arbitration functions of the Bureau of Labor Relations

RTWPB (regional tripartite wage and productivity board) which determines the minimum
wages applicable in a region and issues wage orders, subject to guidelines from NWPC.

The administration and enforcement responsibility of DOLE suffers severely from shortage of
labor inspectors. To remedy this problem partly and to build a culture of compliance among employers
based on voluntariness instead of compulsion, the DOLE issued DO No. 57-04 also called the Labor
Standards Enforcement Framework which comprises 3 approaches: (a) self-assessment, (b) inspection, (c)
advisory service.

Self-assessment is a voluntary compliance mode applicable to and encouraged in establishments


with at least 200 workers and regardless of number of workers, to unionized firms with CBA. The self-
assessment is guided by a check-list that DOLE regional office provides in the first quarter of every year.
Within a month after receiving the check-list committee compose of employer and employee
representatives shall accomplish the checklist and submit it to the DOLE in five days.

The second mode, inspection, is undertaken by DOLE inspectors in workplace with 10 to 199
workers. Given inspection priority are workplaces that are subjects of complaints or where accident and
illnesses are imminent or work hazard exists. Also in priority list are the construction sites and places
where women and children work.

The third enforcement approach consists in providing advisory services to establishment with less
than 10 workers and those registered as BMBEs. These small businesses are given assistance to improve
their productivity, thereby facilitating their eventual compliance with labor standards.

2. Some labor standards are likewise adjudicated at the regional level. What are the limits to such
adjudicatory function?

- If employer-employee stills exist regional director has power to order and administer, after due
notice and hearing, compliance with labor standards provision of the labor code/ other laws

- DOLE regional director must endorse the case to Labor Arbiter where employer contests finding
of labor standards and welfare officers and raises issues which cannot be resolved without considering the
evidentiary matters that are not verifiable in the normal course of inspection

- Regional director is with authority to declare an order or law unconstitutional; only duty is to
enforce the laws, which stands valid

3. Administrative orders or adjudications are appealable. To whom? When?

An order issued under this article is appealable to the DOLE secretary, the administrative superior
of the regional director.

The decision of the Secretary becomes final and executory after 10 calendar days from receipt of
records of the case. A motion for reconsideration of the secretarys decision has to be filed as a
precondition for any further or subsequent remedy. If the motion is denied, a special civil action for
certiorari under RULE 65 of the Rule of Court may be filed with the CA within 60 days from receipt of the
denial of the motion.

BOX 17

Women, as a rule, are not allowed to engage in nightwork. What are the exceptions?

The following:

In cases of actual or impending emergencies caused by serious accident, fire, flood, typhoon,
earthquake, epidemic or other disasters or calamity, to prevent loss of life or property, or in
cases of force majeure or imminent danger to public safety;

In case of urgent work to be performed on the machineries, equipment or installations, to


avoid serious loss which the employer would otherwise suffer;

Where the work is necessary to prevent serious loss of perishable goods;

Where the woman employee holds a responsible position of managerial or technical nature,
or where the woman employee has been engaged to provide health and welfare service;

Where the nature of the work requires the manual skill and dexterity of women workers and
the same cannot be performed with equal efficiency by male workers;

Where the women employees are immediate members of the family operating the
establishment or undertaking; and

Under other analogous cases exempted by the Secretary of Labor in appropriate regulations.

Sex discrimination is basically wrongful. What acts are considered discriminatory against women
employees?

The following:

To deny any woman employee the benefits provided by the law on employment of women or
to discharged any woman employed by him for the purpose of preventing her from enjoying
any of the benefits provided in the Labor Code;

To discharge such woman on account of her pregnancy, or while on leave or in confinement


on account of her pregnancy; or

To discharge or refuse the admission of such woman upon returning to her work for fear that
she may again be pregnant.

BOX 20
Are homeworkers entitled to the right to self-organize? Are they SSS-covered?
The New Rule XIV, among other things, authorizes the formation and registration of labor organization of
industrial homeworkers. It also makes explicit the employers duty to pay and remit SSS, Medicare and ECC
premiums.
Who is their employer?
Art. 155 provides that the employer of homeworkers includes any person, natural or artificial, who for
his account of benefit, or on behalf of any person residing outside the country, direct or indirectly or
through an employee, agent contractor, sub-contractor or any other person:

(1) Delivers, or causes to be delivered, any goods, articles or materials to be processed or fabricated in or about
a home and thereafter to be returned or to be disposed of or distributed in accordance with his directions; or

(2) Sells any goods, articles or materials to be processed or fabricated in or about a home and then rebuys them
after such processing or fabrication, either by himself or through some other person.