LABOR LAW – LABOR STANDARDS BY ATTY. AMADO ADQUILEN

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Labor Standards

DECLARATION OF BASIC POLICY

The state shall afford full protection to labor, promote full employment, ensure equal workopportunities regardless of sex, race or creed, and regulate the relations between workers andemployers. The state shall ensure the rights of workers to self-organization, collective bargaining,security of tenure and just and humane conditions of work. 1 (Read Article XIII, 1987 Constitution)

WHAT IS LABOR STANDARDS?

Labor Standards shall refer to the minimum requirements prescribed by existing laws,rules and regulations and other issuance relating to wages, hours of work, cost of livingallowances and other monetary and welfare benefits, including those set by occupationalsafety and health standards.

DEFINITION OF TERMS:

1. EMPLOYER – includes any person acting directly or indirectly in the interest of anemployer in relation to an employer and shall include the Government and all itsbranches, subdivision and instrumentalities, all government owned and controlledcorporation and institutions, as well as non-profit institutions or organizations. 2

2. EMPLOYER – Includes any person acting in the interest of an employer, directly orindirectly. The term shall not include any labor organization or any of its officers oragents except when acting as employer. 3

3. EMPLOYEE – means any person compulsorily covered by the GSIS under CA 18, asamended, including the member of the Armed Forces of the Philippines, an any personemployed as casual, emergency, temporary, substitute or contractual, or any personcompulsorily covered by the SSS under RA 1161. 4

4. EMPLOYEE – includes any person in the employ of an employer. The term shall not belimited to the employees of a particular employer, unless this Code so explicitly states . Itshall include any individual whose work has ceased as a result of or in connectionwith any current labor dispute or because of any unfair labor practice if he has notobtained any other substantially equivalent and regular employment. 5

5. INDIRECT EMPLOYER – any person, partnership, association or corporation which,NOT being an employer, contracts with an independent contractor for the performance ofany work, task, job or project. 6

6. EMPLOYER OF HOMEOWNERS – includes any person, natural or artificial who for hisaccount, or benefit, or on behalf of any person residing outside the country, directly orindirectly or through any employer, agent, contractor, sub-contractor or any other person:

1 Article 3, Labor Code of the Philippines, as amended2 Article 97 (b) – Labor Code of the Philippines, as amended3 Article 212(e) – Labor Code of the Philippines, as amended4 Article 167 (g) - Labor Code of the Philippines, as amended5 Article 212 (f) - Labor Code of the Philippines, as amended6 Article 107 – Labor Code of the Philippines, as amended

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a. Delivers, or causes to be delivered, any goods, articles or materials to beprocessed or fabricated in or about a home and thereafter to be returned or to bedisposed of or distributed in accordance with his directions; or

b. Sells any goods, articles or materials to be processed or fabricated in or about ahome and then rebuys them after such processing, either himself or throughsome other persons. 7

7. HOUSEHOLD EMPLOYER – any person who engages the services of a house helper.For purposes of this Title, the head of the family shall be deemed the house helper’semployer. 8

NOTES: Class, remember that under your labor laws, a “home worker” is not a “househelper” or “domestic servant ”.

BOOK IPRE-EMPLOYMENT

RECRUITMENT AND PLACEMENT OF WORKERS

WHAT DOES THE TERM “RECRUITMENT AND PLACEMENT” EMBRACE?

The term "recruitment and placement" refers to 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 forprofit or not: Provided, That any person or entity which, in any manner, offers or promisesfor a fee employment to two or more persons shall be deemed engaged in recruitmentand placement. 9

NOTES: Any person who commits the prohibited acts enumerated in Art. 13(b) of the Laborcode shall be liable under Art. 38(a) thereof which considers any recruitment activity undertakenby non-licensed or non-holders of authority as illegal.

WHAT IS REPUBLIC ACT NO. 8042 AND DULY APPROVED OF THE SENATE AND HOUSEOF REPRESENTATIVE OF THE PHILIPPINES IN CONGRESS ASSEMBLED ON JUNE 7,1995?

It is an Act to institute the policies of overseas employment and establish a higherstandard of protection and promotion of the welfare of migrant workers, their families, andoverseas Filipinos in distress and for other purposes.

As its short title, the Act shall be known and cited as the “Migrant Workers and OverseasFilipinos Act of 1995.”

WHO IS A MIGRANT WORKER?

Migrant worker refers to a person who is to be engaged or has been engaged in aremunerated activity in a state which he or she is not a legal resident; to be usedinterchangeably with Overseas Filipino Worker.

7 Article 155, Labor Code of the Philippines, as amended8 Circular 21-V, Implementing Guidelines on the Social Security Coverage of househelpers,9 Article 13(b) ) - Labor Code of the Philippines, as amended

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WHAT ARE THE RELIEF GRANTED BY LAW TO AN ILLEGALLY DISMISSED OVERSEASFILIPINO WORKER UNDER REPUBLIC ACT NO. 8042?

In case of termination of overseas employment without just cause, or valid or authorizedcause as defined by law or contract, the worker shall be entitled to the full reimbursementof his placement fee with interest at twelve percent per annum, plus his salaries for theunexpired portion of his employment contract or three month for every year of theunexpired term, whichever is less.

NOTES: As in the case of an illegally dismissed domestic helper/servant, Article 279 of theLabor Code does not apply. Do not reinstate an illegally terminated OFW to Saudi Arabia, hemight come home in a sealed casket.

WHEN WILL YOU CONSIDER ILLEGAL RECRUITMENT AN OFFENSE INVOLVINGECONOMIC SABOTAGE?

Illegal recruitment when committed by a SYNDICATE or in large scale shall beconsidered an offense involving economic sabotage.

WHEN WOULD YOU CONSIDER ILLEGAL RECRUITMENT AS HAVING BEEN COMMITTEDBY A SYNDICATE OR IN LARGE SCALE?

Illegal recruitment is committed in large scale if it is perpetrated against three or morepersons individually or as a group. Its requisites are as follows: 1) the person chargedwith the crime must have undertaken recruitment activities as so defined by law; 2) thesame person does not have a license or authority to do such; and 3) the questioned act iscommitted against three or more persons. For this offense, Art 39(a) of the Labor Codeimposes the penalty of life imprisonment and a fine of one hundred thousand pesos. 10

WHAT ARE THE ELEMENTS OF ILLEGAL RECRUITMENT?

The elements of Illegal Recruitment are as follows:

1. That the offender had no valid license or authority required by law to enable one tolawfully engage in recruitment and placement of workers;

2. That the offender undertakes either any activity within the meaning of recruitment andthe placement as defined by Art. 13(b) or any prohibited practice enumerated underArt. 34 of the Labor Code of the Philippines.

WHAT ARE THE KINDS OF ILLEGAL RECRUITMENT

There are at least four (4) kinds/types of illegal recruitment under the law:

a. One is SIMPLE recruitment committed by a licensee or holder of authority. Thelaw penalizes such offender with imprisonment of “not less than 2 years nor morethan 5 years or a fine of not less than P10,000.00 nor more than P50,000.00, orboth such imprisonment and fine”;

b. Any person “who is neither a licensee nor a holder of authority” commits thesecond type of illegal recruitment. The penalty imposed for such offense is:imprisonment of not less than 4 years nor more than 8 years or a fine of not less

10 People vs. Saley, GR No. 121179, July 2, 1998

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than P20,000.00 nor more than P100,000.00 or both such imprisonment and fineat the discretion of the court.”

c. The third type of illegal recruitment refers to offenders who either commit theoffense ALONE OR WITH ANOTHER PERSON against 3 or more personsindividually or as a group;

d. A syndicate or a group of 3 or more persons conspiring and confederating withone another in carrying out the act circumscribed by the law commits the fourth(4th) type of illegal recruitment by law.

For the 3rd and 4th types of illegal recruitment, the law prescribes the penalty of lifeimprisonment and a fine of P100,000.00. 11

NOTES: Class, please note that the real nature of a criminal charge is determined not fromthe technical name given by the fiscal appearing in the title of the information but by the actualrecital of facts appearing in the complaint or information. Thus, where the allegations in theinformation clearly set forth the essential elements of the crime charged, the constitutional right ofthe accused to be informed of the nature and cause of his accusations is not violated.

Thus, if it is shown by the prosecution that the person charged is not licensed or authorized torecruit overseas workers, and undertook recruitment activities defined under Article 34 of theLabor Code and he recruited 4 persons, the crime of illegal recruitment in large scale iscommitted. 12

In People vs. Benzon Ong, 13 the Supreme Court said that: “In order to prove Illegal Recruitment,it must be shown that the accused-appellant gave the complainants the distinct impression thathe had the power or ability to send complainants abroad for work such that the latter wereconvinced to part with their money in order to be employed.”

MAY THE CONVICTION OF A PERSON FOR ILLEGAL RECRUITMENT UNDER THE LABORCODE BAR THE PUNISHMENT OF THE OFFENDER FOR ESTAFA UNDER THE REVISEDPENAL CODE?

NO. Illegal recruitment is a malum prohibitum offense where criminal intent of theaccused is not necessary for conviction while estafa is malum in se which requirescriminal intent to warrant conviction. Under Art. 316 par. 2(a) of the Revised Penal Code,the elements of the offense (estafa) are that the accused has defrauded another byabuse of confidence or by means of deceit and that damage or prejudice capable ofpecuniary estimation is caused to the offended parties. If these elements are clearlyshown, then conviction for illegal recruitment under a special law (such as the labor code)and estafa under the Revised Penal Code may be had.

NOTES: Generally, recruitment of a person for employment without the necessaryrecruiting permit or authority from the appropriate government offices constitute illegal recruitmentand where some other crimes or felonies are committed in the process, conviction under the laborcode does not preclude punishment under other statutes. 14

11 People vs. Sadiosa, G.R. No. 107084, May 15, 199812 . Abaca vs. CA, G.R. no. 127162, Jan. 5, 199813 People vs. Benzon Ong, GR NO. 119594, January 18, 200014 People vs. Calonzo, 262 SCRA 534 [1996]

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AFTER THE EXECUTION OF THEIR EMPLOYMENT CONTRACT, THREE RECRUITS LEFTFOR SAUDI ARABIA. A FEW DAYS AFTER THEIR ARRIVAL, THEY WERE ASKED TO SIGNA SECOND CONTRACT WHERE SOME OF THE PROVISIONS OF THEIR ORIGINALCONTRACT WERE BEING CHANGED TO INCREASE THE NUMBER OF THEIR WORKHOURS WITH A CORRESPONDING INCREASE IN THEIR SALARIES, WHICH INCREASEWAS NEVER GIVEN. TWO MONTHS AFTER, THEY WERE AGAIN ASKED TO SIGN ATHIRD CONTRACT WHERE THEIR NUMBER OF WORK HOURS WAS INCREASED. WHENTHEY REFUSED TO SIGN THE THIRD CONTRACT, THEY WERE BEING TERMINATED ANDREPATRIATED TO THE PHILIPPINES. WAS THERE A CONTRACT SUBSTITUTION?

Yes. The first contract was duly approved by the POEA and both parties are bound bywhat is stated in that contract up to its expiration. The intention to increase the number ofhours of work, even with the corresponding increase in pay, is clearly a violation of thecontract approved by the POEA, and the amendments is contrary to law, morals, goodcustoms and public policy and hence must be shunned. 15 Besides the proposed salaryincrease corresponding to the increase in number of work hours may just have been amere ploy because the promised increased in pay was never given. 16

MAY A FILIPINO APPLY DIRECTLY WITH A PROSPECTIVE FOREIGN EMPLOYER?

No. The law provides that no employer may hire a Filipino worker for overseasemployment except through the Boards and entities authorized by the Department ofLabor and Employment. However, direct hiring by members of the diplomatic corps,international organizations, and such other employers as may be allowed by theDepartment of Labor and Employment is exempted from this provision. 17

REGULATION OF RECRUITMENTAND PLACEMENT ACTIVITIES

ON RECRUITMENT, WHAT DO YOU MEAN BY THE TERM “LICENSE” AND “AUTHORITY”?IS IT TRANSFERABLE?

A LICENSE is a document issued by the DOLE authorizing a person, or entity to operatea private employment agency, while an AUTHORITY is a document issued by the DOLEauthorizing a person or association to engage in recruitment and placement activities asprivate recruitment agency. 18

No license or authority shall be used directly or indirectly by any person other than theone in whose favor it was issued or any place other than that stated in the license orauthority, no may such a license or authority be transferred, conveyed or assigned to anyother person or entity. 19

NOTES: Class, remember your general rule that recruitment of persons for employmentwithout the necessary recruiting permit or authority from the appropriate government officesconstitutes illegal recruitment and where some crimes or felonies are committed in the process,conviction under the labor code does not preclude punishment under other statutes. 20

15 Art. 1306, Civil Code of the Philippines; Book III, Title 1, Chapter 1, Art. 83, Laborcode, as amended16 PHILSA v. Secretary of Labor, GR 103144, SC 3rd Div., J. Gonzaga-Reyes, April 4,200117 Article 18, Labor Code of the Philippines, as amended18 People vs. De Leon, 267 SCRA 64419 Article 29, Labor Code of the Philippines, as amended20 People vs. Calonzo, 262 SCRA 534 [1996]

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IS A LOCAL RECRUITMENT AGENCY LIABLE FOR UNPAID WAGES OF WORKERS ITDEPLOYED ABROAD?

Yes, a recruitment agency is solidarily liable for the unpaid salaries of a worker itrecruited for employment with a foreign principal. Section 10, Rule V of the ImplementingRegulations of the Labor Code provides that “before recruiting any worker, the privateemployment agency shall submit the following documents: x x x (2) Power of the agencyto sue and be sued jointly and solidarily with the principal or foreign based employer forany violations of the recruitment agreement, and the contract of employment. 21 In otherwords, the liability of the principal may be enforced to the full extent against therecruitment agency.

EMPLOYMENT OF NON-RESIDENT ALIENS

MAY A NON-RESIDENT ALIEN BE PERMITTED TO WORK IN THE PHILIPPINES? IF SO,UNDER WHAT CONDITIONS?

Yes, a non-resident alien may be permitted to work in the Philippines. Any alien seekingadmission to the Philippines for employment purposes and any domestic or foreignemployer who desires to engage an alien for employment in the Philippines shall obtainan employment permit for the Department of Labor and Employment. 22

This is however subject to the determination of the non-availability of a person in thePhilippines who is competent, able and willing at the time of application to perform theservices for which the alien is desired.

WHO MUST APPLY FOR ALIEN EMPLOYMENT PERMIT (AEP)?

They are:

1. Foreign nationals seeking employment or admission to the Philippines to gainemployment;

2. Non-resident foreign nationals actually working in the Philippines under any form ofcontract of employment;

3. Non-resident foreign nationals admitted to the Philippines on non-working visas andwho wish to seek employment;

4. Missionaries or religious workers who intend to engage in gainful employment.

(Research aid: Department Order No. 1 series of 1999

SHOULD AN ALIEN STILL SECURE AN EMPLOYMENT PERMIT TO WORK HERE IN THEPHILIPPINES IF THE SOURCE OF HIS COMPENSATION STILL COMES FROM HISEMPLOYER BASED OUTSIDE THE PHILIPPINES?

Yes, the employment permit shall be required, regardless of the source of funds to paythe compensation and other benefits and the nature and duration of employment, part-time or temporary.

WHAT ARE THE DOCUMENTS REQUIRED TO SUPPORT THE APPLICATION FOR ALIENEMPLOYMENT PERMIT? 21 Eastern Assurance & Surety Corp. vs. Secretary of Labor, GR Nos. 79436-50,January 17, 199022 Article 40, Labor Code of the Philippines, as amended

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The following documents must accompany the application:

1. Curriculum vitae duly signed by the applicant indicating his educational background, hiswork experience and other data showing that he possesses technical skills in his trade orprofession;

2. Contract of employment between the employer and applicant which shall embody thefollowing, among others:

a. That the applicant will comply with all laws, rules and regulations of thegovernment of the Philippines;

b. That the employer binds himself to train at least two (2) Filipino under studies fora period determined by the Secretary of Labor and Employment; and

c. That the applicant shall not engage in any other gainful employment other thatwhat is issued under the permit.

In case of an elected officers such as Chairman of the Board, Members of the Board ofTrustees/Directors, President of Corporations and Partnerships, resolutions orcertification attesting to the election of the applicant, accompanied by copy of Articles ofIncorporation or Partnership or By-Law.

3. The employer states under oath, within 30 days upon arrival of the alien worker, thatshall:

a. Designate at least two (2) understudies for every alien worker. Suchunderstudies must be the most ranking regular employees in the section ordepartment for which the expatriates are being hired to ensure the actual transferof technology; and

b. Submit to the Regional Office for approval an understudy program for theunderstudies. The Regional Office shall supervise the training program inaccordance with the standards established by the Secretary.

The permit may be revoked for non-compliance by the employer of the aboverequirements.

4. A certification, under oath, by employer on the period required to effect transfer oftechnology as indicated in the understudy training program.

Research Aids:Department Order No. 25, Series of 1996Department Order No. 4 & 4a, Series of 1996Department Order No. 1, Series of 1999

BOOK IINATIONAL MANPOWER DEVELOPMENT PROGRAM

WHAT GOVERNMENT AGENCY IS RESPONSIBLE FOR THE COUNTRY’S TECHNICALEDUCATION, PLANNING AND DEVELOPMENT? WHAT IS IT SUPPOSE TO ACCOMPLISH?

Implementation of the National Manpower Development Program was the responsibilityof the National Manpower and Youth Council. But the NMYC has been replaced by andits functions absorbed by the Technical Educations and Skills Development Authority(TESDA) created under RA 7796, known as the TESDA Act of 1994.

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It is the goals and objectives of the Act to:

1. Promote and strengthen the quality of technical education and skills developmentprogram to attain international competitiveness;

2. Focus technical education and skills development on meeting the changing demandsfor quality middle level-manpower;

3. Encourage critical and creative thinking by disseminating the scientific and technicalknowledge base of middle level manpower development programs;

4. Recognize and encourage the complementary roles of public and private institutionsin technical education and skills development and training systems; and

5. Inculcate desirable values through the development of moral character with emphasison work ethic, self-discipline, self-reliance and nationalism. 23

TRAINING AND EMPLOYMENTOF SPECIAL WORKERS

WHAT KIND OF JOBS MAY AN EMPLOYER HIRE APPRENTICES?

Only employers in the highly technical industries may employ apprentices and only inapprenticeable occupations approved by the Minister of Labor and Employment (nowSecretary of DOLE). 24

NOTES: Apprenticeship program needs the prior approval of the Secretary of theDepartment of Labor and Employment. Failing which, the “apprentice” is not classified as suchbut a regular employee.

WHAT IS AN APPRENTICEABLE OCCUPATION?

An apprenticeable occupation means any trade, form of employment or occupation whichrequires more than three months of practical training on the job supplemented by relatedtheoretical instruction. 25

WHO IS A LEARNER?

Learners are persons hired as trainees in semi-skilled and other industrial occupations,which are non-apprenticeable and which may be learned through practical training on thejob in a relatively short period of time which shall not exceed three months. 26

DISTINGUISH A LEARNERSHIP FROM AN APPRENTICESHIP?

Learnership and apprenticeship differ in the focus and the terms of training. A learner trains in asemi-skilled job or in an industrial occupation that require training for less than three months. Anapprentice on the other hand, trains in a skilled or highly skilled job or in a job found only in ahighly technical industry. The period or duration of which exceeds three months.

WHO ARE HANDICAP WORKERS? WHEN MAY THEY BE EMPLOYED?

Handicap workers are those whose earning capacity is impaired by age or physical ormental deficiency or injury. 27 They may be employed when their employment is

23 Section 3, RA 7796, otherwise known as the TESDA Act of 199424 Article 60, Labor Code of the Philippines, as amended25 Article 57 (c), Labor Code of the Philippines, as amended26 Article 73, Labor Code of the Philippines, as amended

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necessary to prevent curtailment of employment opportunities and when it does notcreate unfair competition in labor costs or impair or lower working standards. 28

BOOK IIICONDITIONS OF EMPLOYMENT

WORKING CONDITIONS: DEFINED.

Working conditions refer to the terms and circumstances affecting the employment of anemployee, including policies, programs and regulations governing his employment status,work and work relationships. The working conditions, as a rule, are determined by theemployer. This authority of management is called, quite loosely, managementprerogative.

WHO ARE EXEMPTED FROM COVERAGE OF ARTS. 82-96 OF THE LABOR CODE ONHOURS OF WORK?

1. Government employees;2. Managerial employees;3. Field personnel;4. Employees who are family members dependent for support;5. Domestic helpers;6. Persons engaged in personal service;7. Workers paid by results as determined by the Secretary of Labor.

WHAT IS THE SO-CALLED FOUR-FOLD TEST IN DETERMINING THE EXISTENCE OFEMPLOYER-EMPLOYEE RELATIONSHIP?

The four-fold tests in determining the existence of employer-employee relationship are asfollows:

1. The power to hire or selection and engagement;2. Payment of wages;3. Power to dismiss; and4. Power of control (essential element). 29

NOTES: The “right to control” shall refer to the rights reserved to the person for whom theservices performed, to determine not only the ends to be achieved, but also the manner andmeans to be used in reaching that end.

CITE AN OBSERVATION OF THE HONORABLE SUPREME COURT AS TO THECONSEQUENCE OF EMPLOYER-EMPLOYEE RELATIONSHIP.

The question of whether an employer-employee relationship exists in a certain situationCONTINUES TO BEDEVIL THE COURTS. Some businessmen try to avoid the bringingabout of an employer-employee relationship in their enterprise because that judicialrelation spawns obligation to be connected with workmen’s compensation, socialsecurity, medicare, minimum wage, termination pay, and unionism. 30

27 Article 78, Labor Code of the Philippines, as amended28 Article 79, Labor Code of the Philippines, as amended29 AFP Mutual Benefits Association Inc. vs. NLRC, 267 SCRA 4730 Mafino Trading Corp. vs. Ople, 70 SCRA

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AS ONE OF THE CRITERIA IN THE DETERMINATION OF THE EXISTENCE OF EMPLOYER-EMPLOYEE RELATIONSHIP, IT IS ESSENTIAL FOR AN EMPLOYER TO ACTUALLYEXERCISE THE SO-CALLED CONTROL TEST?

The power or control refers to the existence of the power and not necessarily to theactual exercise thereof. It is not essential, in other words, for the employer to actuallysupervise the performance of duties to wield that power. 31

In short, an employer-employee relationship exists where the person for whom theservices are performed reserves a right to control not only the end to be achieved butalso the means to be used in reaching such an end 32 but, consider that not every form ofcontrol in relation to the service being rendered may be accorded the effect ofestablishing an employer-employee relationship as when an underwriter, who from timeto time is bound by company policies, memo, circular, rules and regulations, is also notindicative of control.

EXPLAIN THE BASIC PRECEPT “FAIR DAY’S WAGE FOR A FAIR DAY’S LABOR”.

A fair day’s wage for a fair day’s labor governs the relations between labor and capitaland remains a basic factor in determining employees’ wages. If there is no workperformed by the employee, there can be no wage or pay unless the laborer was able,willing, and ready to work but was prevented by management or was illegally locked out,suspended or dismissed. 33

DISTINGUISH “FACILITIES” FROM “SUPPLEMENTS”.

“Supplements” constitute extra remuneration or special privileges or benefits given to orreceived by the laborer over and above their ordinary earnings or wages.

“Facilities”, on the other hand, are items of expense necessary for the laborer’s and hisfamily’s existence and subsistence, so that by express provision of law, they form part ofthe wage and when furnished by the employer are deductible therefrom, since if they arenot so furnished, the laborer would spend and pay for them just the same. 34

STATE THE GENERAL PRINCIPLE ON A WORKER’S ENTITLEMENT TO SERVICEINCENTIVE LEAVE OF FIVE DAYS EACH YEAR?

Under Article 95 (a) of the Labor Code, every employee who has rendered at least oneyear of service shall be entitled to a yearly incentive leave of five days with pay.

NOTES: Since a service incentive leave is clearly demandable after one year of service –whether continuous or broken- or its equivalent period, and is one of the “benefits” which wouldhave accrued if an employee was not otherwise illegally dismissed. It is fair and legal that itscomputation should be up to the date of reinstatement as provided under Article 279 of the LaborCode, as amended. 35

WHAT IS THE MEANING OF “ONE YEAR OF SERVICE” IN DETERMINING THE 5-DAYSSERVICE INCENTIVE LEAVE OF A COVERED EMPLOYEE?

31 Equitable Banking Corp. vs. NLRC, 273 SCRA 35232 Algon Engineering Construction Corp. vs. NLRC, 280 SCRA 18833 Philippine Airlines vs. NLRC, GR No. 55159, June 22, 198934 Atok Big Wedge Assn. vs. Atok Big Wedge Co., 97 Phil 29435 Vivian Imbuido vs. NLRC, et.al, GR No. 114734, March 31, 2000

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The phrase “one-year of service” of the employee means service within 12 months,whether continuous or broken, reckoned from the date the employee started working.The period includes authorized absence, unworked weekly rest days, and paid regularholidays. Where by individual or collective agreement, practice or policy the period ofworking days is less than 12 months, said period shall be considered as one year for thepurpose of determining entitlement to the service incentive leave.

BY EXPRESS PROVISION OF LAW, WHO ARE NOT ENTITLED TO SERVICE INCENTIVELEAVE?

The following are, by express provision of law not entitled to Service Incentive Leave:

a. Those from the government and any of its political subdivisions, includinggovernment owned and controlled corporation;

b. Domestic helpers and persons in the personal service of another;

c. Managerial employees or members of the managerial staff as defined in Book IIIof the Labor Code;

d. Field personnel and other employees whose performance is unsupervised by theemployer including those who are engaged on task or contract basis, purelycommission basis, or those who are paid in a fixed amount for performing workirrespective of the time consumed in the performance thereof;

e. Those who are already enjoying the benefits provided therein;

f. Those enjoying vacation leave with pay of at least five days; and

g. Those employed in establishments regularly employing LESS THAN TENEMPLOYEES.

HOW ARE “SERVICE CHARGES” DISTRIBUTED OR SHARED?

The sharing shall be 85% equally distributed to all employees except managerialemployees and 15% for the employer to answer for the losses or breakage or to bedistributed to the managerial employees, as the case may be.

Where the company stopped collecting service charges, the average shall previouslyenjoyed by the employees for the past twelve (12) months immediately preceding suchstoppage shall be integrated with their basic wages.

WHAT IS RA 8187 ALL ABOUT AND WHEN DID IT TAKE EFFECT?

It is an act granting paternity leave of seven (7) days with full pay to all married MALEemployees in the private and public sector for the FIRST FOUR (4) deliveries of thelegitimate spouse with whom he is cohabiting and for other purposes. It took effect onJuly 5, 1996

NOTES: Class, read the copy of the Revised Implementing Rules and Regulations of RA8187 for the Private Sector hereunder reproduced in full.

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Again, please note that under this law, an “Employee” refers to any person who performs servicesfor another and receives compensation therefor, provided an employer-employee relationshipexists between them. How about your “employee” as defined in Article 97 (c) and Article 212 (f)of your Labor Code? You know what I mean…

Department of Labor and Employment / Department of HealthRevised Implementing Rules and Regulations of Republic Act 8187

For the Private Sector

Pursuant to Republic Act No. 8187 entitled “An Act Granting PaternityLeave of Seven (7) days With full Pay to All married Male Employees inthe Private and Public Sectors For the First Four (4) deliveres of theLegitimate Spouse With Whom He is Cohabiting And For OtherPurposes,” the following Revised Rules and Regulations are herebyissued:

Section 1. Definition of Terms – As used in these Rules, the followingterms shall have the meaning as indicated hereunder:

a. “Paternity Leave” refers to the leave benefits granted to amarried male employee allowing him not to report for workfor seven (7) days but continues to earn the compensationtherefor, on the condition that his spouse has delivered achild or suffered a miscarriage for the purpose of lendingsupport to his wife during her period of recovery and/or innurshing of the newly born child.

b. “Employee” refers to any person who performs services foranother and receives compensation therefor, provided anemployer-employee relationship exists between them.

c. “Delivery” refers to childbirth or miscarriage.d. “Spouse ” refers to the lawful wife. For this purpose, lawful

wife refers to a woman who is legally married to the maleemployee concerned.

e. “Cohabiting” refers to the obligation of the husband and wifeto live together.

Section 2. Coverage. Every married male employee in the private sectorshall be entitled to paternity leave benefits of seven (7) days with full payfor the first four deliveries by his lawful spouse under such terms andconditions as hereinafter provided.

The rules on paternity leave of employees in the public sector shall bepromulgated by the Civil Service Commission.

Section 3. Conditions to entitlement of paternity leave benefits. – Amarried male employee shall be entitled to paternity benefits providedthat:

a. he is an employee at the time of delivery of his child;b. he is cohabiting with his spouse at the time she gives birth or

suffers a miscarriage;c. he has applied for paternity leave in accordance with Section

4 hereof; andd. his wife has given birth or suffered a miscarriage.

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Section 4. Application for Leave. – the married male employee shallapply for paternity leave with his employer within a reasonable period oftime from the expected date of delivery by the pregnant spouse, or withinsuch period as may be provided by company rules and regulations or bycollective bargaining agreement; provided that prior application for leaveshall not be required in case of miscarriage.

Section 5. Availment – Paternity leave benefits shall be granted to thequalified employee after the delivery by his wife, without prejudice to anemployer allowing an employee to avail of the benefit before or duringthe delivery; provided, that the total number of days shall not exceedseven (7) days for each delivery.

Section 6. Benefits – The employee is entitled to his full pay, consistingof basic salary, for seven (7) days during which he is allowed not toreport fro work; provided that his pay shall not be less than the mandatedminimum wage.

Section 7. Non-commutation of benefits. – In the event that the paternityleave benefit is not availed of, said leave, shall not be convertible tocash.

Section 8. Non-diminution Clause. – Nothing in these Rules shall beconstrued to reduce or replace any existing benefits of any kind grantedunder existing laws, decrees, executive orders, or any contract,agreement or policy between employer and employee.

Section 9. Crediting of existing benefits. – Where a male employee isalready enjoying the paternity leave benefits by reason of contract, acompany policy or collective bargaining agreement, the following rulesshall apply.

a) If the existing paternity leave benefit is greater than thebenefit herein provided, the greater shall prevail;

b) If the existing paternity leave is less than that providedherein, such existing benefit shall be adjusted to the extentof the difference.

However, where a contract, company policy or collective bargainingagreement provides for an emergency or contingency leave withoutspecific provisions on paternity leave, the paternity leave as hereinprovided shall apply in full.

Section 10. Penalty. – Any person, corporation, trust, firm, partnership,association or entity found violating any provision of these Rules shall bepenalized by a fine not exceeding twenty five thousand pesos(P25,000.00) or imprisonment of not less than thirty (30) days nor morethan six (6) months.

If the violation is committed by a corporation, trust or firm, partnership,association or any other entity, the penalty of imprisonment shall beimposed on the entity’s responsible officer, including but not limited to,the president, vice president, chief executive officer, general manager,managing director or partner directly responsible therefor.

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Section 11. Transitory provisions – All qualified employees whosespouse delivered a chilled or suffered a miscarriage on or after July 5,1996 are entitled to paternity leave, subject to the conditions prescribedin Section 3, paragraphs (a) and (b).

Section 12. Repealing Clause – All laws, ordinances, rules, regulations,issuances, or parts thereof which are inconsistent with these Rules aredeemed repealed or modified accordingly.

Section 13. Separability Clause – If any provisions or portion of theseRules is declared void or unconstitutional, the remaining portions orprovisions hereof shall continue to be valid and effective.

Section 14. Effectivity – These Revised Rules shall take effect on 05July 1996.

Signed this 13th day of March 1997 in the City of Manila.

(sgd) LEONARDO QUISUMBINGSecretaryDepartment of Labor and Employment

(sgd) CARMENCITA REODICASecretaryDepartment of Health

ON THE OTHER HAND, WHAT IS MATERNITY BENEFIT?

Maternity benefit is a cash allowance granted to female member (SSS) who was unableto work due to child birth or miscarriage (Guidelines on RA 8282 effective may 24, 1997)

WHAT ARE THE CONDITIONS REQUIRED BY LAW IN ORDER TO BE ENTITLED TOMATERNITY BENEFITS?

The conditions are as follows:

1. Maternity benefits shall be paid for the first four (4) deliveries including miscarriages;2. The fifth delivery shall no longer be paid even if no availment were made on the previous

deliveries (beginning March 13, 1973);3. The member has given the required notification to SSS prior to date of contingency;4. She has paid at least three (3) months of maternity contributions within the twelve month

period immediately before the semester of contingency.

WHO ARE ELIGIBLE UNDER THE LAW TO RECEIVE MATERNITY BENEFITS?

ALL female members, including self-employed and voluntary members with qualifyingcontributions using the new contributions schedule shall be entitled to maternity benefit.

Every pregnant woman employee in the private sector whether MARRIED orUNMARRIED, is entitled to maternity leave benefits.

HOW MANY DAYS WOULD COMPRISE THE MATERNITY LEAVE OF A COVERED SSSMEMBER?

For normal delivery or miscarriage, it is sixty (60) days and seventy eight (78) days forcaesarian cases.

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IN COMPUTING THE 13TH MONTH PAY OF A FEMALE EMPLOYEE, DOES THE LAW(PD 851) PROVIDE FOR THE INCLUSION OF THE MATERNITY LEAVE BENEFIT INCOMPUTING THE SAME.

Maternity benefits, like other benefits granted by the SSS, are granted to employees inlieu of wage and, therefore, MAY NOT be included in computing the employee’s 13th

month pay for the calendar year.

MAY AN EMPLOYEE COLLECT THE CASH EQUIVALENT OF HIS FIVE-DAYS SERVICEINCENTIVE LEAVE UNDER ARTICLE 95 OF THE LABOR CODE BEYOND THE THREEYEAR PRESCRIPTIVE PERIOD OF CLAIMING MONEY CLAIMS ARISING OUT OF ANEMPLOYER-EMPLOYEE RELATIONSHIP UNDER ARTICLE 291 OF THE LABOR CODE?

Yes. Service Incentive Leave is a right which accrues to every employees who haveserved within twelve (12) months, whether continuous or broken reckoned from the dateof the employee has started working, including authorized absences, and paid regularholidays x x x and shall be commutable to its money equivalent if not used or exhaustedat the end of the year. The law does not prohibit its commutation. Moreover, to limit theaward of the Service Incentive Leave to three years would run contrary to the ruling of thecourt in Bustamante vs. NLRC 36 which provides inter alia that: “ an illegally dismissedemployee is entitled to reinstatement to his former position without loss of seniority rightsand privileges and to his full backwages, inclusive of allowances, and to his other benefitsor their monetary equivalent computed from the time his compensation was withheld fromhim up to the time of his actual reinstatement as provided under Art. 279 of the LaborCode as amended by RA 6715”.

WHAT IS THE RELATIVELY OBSCURE CONCEPT OF WAGE DISTORTION?

The principle may be summarily stated in the following manner:

a. The concept of wage distortion assumes an existing grouping or classification ofemployees which establishes distinction among such employees or some relevant orlegitimate basis. This classification is reflected in a differing wage rate for each of theexisting classes of employees.

b. Wage distortions have been the result of government decreed increases in minimumwages. There are, however, other causes of wage distortions, like the merger of two(2) companies (with differing classifications of employees and different wage rateshere the surviving company absorbs all the employees of the dissolved corporation

IS THE EMPLOYER UNDER AN OBLIGATION TO RESTORE THE “HISTORICAL GAP”BETWEEN THE HEIRARCHY OF POSITIONS IN THE EVENT OF WAGE DISTORTIONRESULTING FROM A MANDATED INCREASE IN THE MINIMUM WAGE?

No. It is sufficient for the employer to maintain a semblance of a gap for workers hiredafter the wage increase. For the present employees, it is mandatory for the employer tocorrect the distortion through the grievance procedure under their CBA and by voluntaryarbitration if it remains unresolved.

WHAT ARE THE PENALTIES, IF ANY, IMPOSED BY LAW UPON ANY EMPLOYER WHOFAILS TO PAY THE PRESCRIBED MINIMUM WAGE RATES IN ACCORDANCE WITHTHE MINIMUM WAGE LAW OR WAGE ORDERS.

36 Bustamante, et.al vs. NLRC, 265 SCRA 61, November 28, 1996

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Any employer, including corporations, partnerships, or associations, who fail to pay theprescribed wage rates in accordance with the Minimum Wage Law or Wage Order will bepenalized as follows:

a. fine of not less than P 25,000.00 nor more than P100,000.00; orb. imprisonment of not les than two (2) years nor more than four (4) years; or

both at the discretion of the court. The convicted employer shall not beentitled to benefits under probation law (unenforced sentence)

c. pay an amount equivalent to double the unpaid difference in wages owing tothe employees;

d. finally, criminal liability for any crime provided for in RA 6727 (as amended byRA 8188)

WHEN IS A BONUS DEMANDABLE?

A bonus is demandable:

1. When made part of a wage/salary/compensation;2. If the promise of the bonus is made at the time the contract between the employer

and the employee was entered into;3. If it is additional compensation which the employer promised and agreed to give

without any conditions imposed for its payment; or4. When the giving of such bonus has formed part of the company practice. As a

company practice, it should have been done over a long period of time and shown tohave been consistent and deliberate. 37

WHAT IS THE PURPOSE OF HOLIDAY PAY?

It is meant to prevent diminution of the monthly income of workers on account of workinterruptions. 38

WHAT IS THE METHOD OF COMPUTING FOR OVERTIME PAY, DAILY WAGE, ANDHOURLY RATE, AND HOURLY RATE?

a. Overtime Pay = Hourly rate + Premium rateb. Daily wage = (Basic annual rate + Fringe benefits) / No. of days worked in a year;c. Hourly rate = Daily wage / 8 hours

CITE THE RATIONALE/REASONS REQUIRED BY LAW IN PAYING OVERTIME PAY.

1. To compensate the worker for his physical and mental efforts for hours worked beyondthe normal eight hours;

2. Also, it could be viewed as a penalty imposed by society on the employer. The worker isgranted an additional pay in concept of penalty for having been deprived of time forrelaxation, amusement or sports and for opportunity to contribute the community or otherbusiness engagement.

3. Finally, the requirement of overtime pay is a governmental measure to promote fullemployment, because it forces employers to hire more workers for every 8 hour period.

WHAT ARE THE REASONS THAT JUSTIFY THE PAYMENT OF NIGHT SHIFTDIFFERENTIAL PAY?

37 Luzon Stevedoring Corp. vs. CIR citing Manila Electric Cooperative vs. Quisumbing.38 Jose Rizal College vs. NLRC

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1. Lack of sunlight could cause anemia or tuberculosis, eye strain and exposure toaccidents is common;

2. Attendant danger when traveling to and from work at night;3. Disruption of normal home life.

Research Aid:

Principles of Legislation by: AndrewsWHEN IS A WORKPLACE CONSIDERED HAZARDOUS?

A workplace is considered hazardous:

1. When the nature of the work exposes workers to dangerous environmental elements,contamination or work conditions including ionization, radiation, chemicals, fire,flammable substances, noxious components, and the like;

2. When the workers are engaged in construction work, logging, firefighting, mining,quarrying, blasting, stevedoring, dock work, deep sea fishing, and mechanized farming;

3. Where the workers are engaged in the manufacture or handling of explosives and otherpyrotechnic products;

4. Where the workers use or are exposed to heavy or power driven machinery or equipmentand where they have exposed to power-driven tools.

WHAT IS THE MINIMUM EMPLOYABLE AGE?

No child below fifteen years of age shall be employed, except when he works directlyunder the sole responsibility of his parents or guardian and his employment doesnot in anyway interfere with his schooling. 39

HOW ABOUT PERSONS BETWEEN 15 AND 18 YEARS OF AGE?

Any person between 15 and 18 years of age may be employed for such number of hoursand such periods of the day as determined by the Secretary of Labor in appropriateregulations. 40

ARE TAXI DRIVERS PAID ON COMMISSION/PERCENTAGE BASIS EMPLOYEES OF THETAXI OWNER/OPERATOR WHO OWNS THE UNIT BEING DRIVEN BY THE FORMER?

Yes. The doctrine that relationship between jeepney owners/operators on one hand andjeepney drivers on the other under the boundary system is that of employer-employeeand not of lessor-lessee is applicable BY ANALOGY to the relationship between the taxiowner/operators and taxi drivers. 41

MAY A TAXI OWNER/OPERATOR VALIDLY REQUIRE HIS BOUNDARY SYSTEM DRIVERSTO DEPOSIT A CERTAIN AMOUNT TO DEFRAY SHORTAGE (S) IN THE BOUNDARYAGREED UPON BY THEM?

It depends. If the requirement to make deposits from which deductions to defray anyshortage(s) in the agreed sum or boundary is a recognized one, or which is necessary or

39 Article 139, Paragraph (a)40 Article 139, Paragraph (b)41 Martinez vs. NLRC, 272 SCRA 793

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desirable as determined by the Secretary of Labor in appropriate rules and regulationsunder Article 114 of the Labor Code, the same is VALID.

But, if there is no showing that the Secretary of Labor has recognized the same aspractice in the taxi industry, it is NOT VALID. More so if we consider the intent of the lawwhich provides the rules on deposit for loss or damage to tools, materials or equipmentsupplied by the employer. It does not permit deposits to defray any deficiency whichtaxi drivers may incur in the remittances of his boundary.

ONE HUNDRED TEN ATTENDANTS OF MAALIKAYA MASSAGE AND HEALTH CLINICWERE REQUIRED TO RENDER SERVICE FOR SIX (6) DAYS A WEEK, ARE THEYENTITLED TO 30% ADDITIONAL COMPENSATION BASED ON THEIR REGULAR WAGEDURING THEIR SATURDAY WORK AND ASSUMING THAT THE CLINIC IS LOCATED IN APLACE WITH AT LEAST ONE MILLION POPULATION?

No. The term “hospital” or “clinic” as used in Art. 83 of the Labor Code, as amended, shallmean a place devoted primarily to the maintenance and operation of facilities for thediagnosis, treatment and care of individuals suffering from illness, disease, injury ordeformity, or in need of obstetrical or other medical and nursing care. Therefore, sinceMaalikaya is a massage clinic, and not within the contemplation of the term under thelaw, the 110 attendants cannot claim for the 30% additional compensation of theirSaturday work.

MAY A LABOR UNION ACT AS LABOR CONTRACTOR OR ENGAGE IN WHAT WE CALL“CABO” SYSTEM?

No. A labor union who acts as a labor contractor or engage in “cabo” system or otherwiseengaging in any activity prohibited by law risks the cancellation of its registration as alabor union.

A “cabo” system under labor relations law may be an individual, or group of person or alabor union operating under the guise of an employer when in truth and in fact they arenot. They are, in truth what we call the labor-only contractors who prey on thepredicament of gullible workers.

WHAT IS THE TEST TO DETERMINE THE EXISTENCE OF INDEPENDENTCONTRACTORSHIP?

The test to determine the existence of independent contractorship is whether oneclaiming to be an independent contractor has contracted to do work according to his ownmethods and without being subject to control of the employer except only as to the resultof the work.

WHEN AN “INSURANCE AGENT” DEEMED AN INDEPENDENT CONTRACTOR OF ANINSURANCE COMPANY.

In Insular Life Insurance Co. vs. NLRC, 42 there is no employer-employee relationshipbetween a commission agent and an investment company. The former is anindependent contractor where said agent and others similarly placed are (a) paidcompensation in the form of commissions based on percentages of their status, anybalance of commission earned being payable to their legal representatives in the event ofdeath or resignation, (b) required to put up performance bond, (c) subject to a set of rulesand regulations governing the performance of their duties under the agreement with thecompany and termination of their services for certain causes, (d) not required to report for

42 GR No. 84484, November 15, 1989

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work at any time, nor to devote their time exclusively to working for the company not tosubmit a record of their activities, and who finally shouldered their own selling andtransportation expenses.

Logically, the line should be drawn between rules that merely serve as guidelinestowards the achievement of the mutually desired result without dictating the means ormethods to be employed in attaining it, and those that control or fix the methodology andbind or restrict the party hired to the use of such means. The first, which aim only topromote the result, create no employer-employee relationship unlike the second, whichaddress both the result and the means used to achieve it. The distinction acquiresparticular relevance in the case of an enterprise affected with public interest, as is thebusiness of insurance, and is on that account subject to regulation by the State withrespect, not only to the relations between insurer and insured but also to the internalaffairs of the insurance company.

WHEN IS THERE LABOR-ONLY CONTRACTING?

There is labor-only contracting where the person supplying workers to an employer doesnot have substantial capital or investment in the form of tools, equipment, machineries,work premises, are performing activities which are directly related to the principalbusiness of the employer. In such cases, the person or intermediary shall be consideredmerely as an agent of the employer who shall be responsible to the workers in the samemanner and extent as if the latter were directly employed by him. 43 In other words,laway lang ang puhunan!

NOTES: Should the contractor fail to pay the wages of his employees in accordance withthe Labor Code, the employer who contracted out the jobs becomes jointly and severally liablewith the contractor “to the extent of the work performed under the contract “as if such employerwere the employer of the contractor’s employee” 44

AS TO PURPOSE, WHAT DIFFERS SEPARATION PAY FROM RETIREMENT PAY?

Separation pay is a statutory right designed to provide the employee with the wherewithalduring the period that he is looking for another employment while retirement benefits areintended to help the employee enjoy the remaining years of his life lessening the burdenof worrying for his financial support and a form of reward for his loyalty and service to theemployer. 45

ARE SEAMEN ENTITLED TO OVERTIME PAY FOR EVERY HOUR IN EXCESS OF REGULARWORKING HOURS THAT THEY WERE ON BOARD THEIR VESSEL EACH DAY,IRRESPECTIVE OF WHETHER THEY ARE ACTUALLY PUT TO WORK DURING THOSEHOURS?

No. The correct criterion in determining whether or not sailors are entitled to overtime payis not therefore, whether they were on board and cannot leave the ship beyond theregular eight working hours a day, but whether they actually rendered service in excessof said number of hours. 46

43 Article 106, Labor Code of the Philippines, as amended44 Philippine Bank of Communications vs. NLRC, GR No. 66598, December 16, 199645 Aquino et.al vs. NLRC, 206 SCRA 11846 National Shipyard and Steel Corp vs. CIR, et.al 113 Phil 870 cited in Stot-NiessenMarine Services Inc. vs. NLRC 264 SCRA 307

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WHAT IS THE GENERAL PRINCIPLE IN DETERMINING THE PAY/RATE OF WORKERSPAID BY RESULTS UNDER ARTICLE 101 OF THE LABOR CODE?

The Secretary of Labor shall regulate the payment of wages by results, including pakyao,piecework and other non-tie work, in order to ensure the payment of fair and reasonablewage rates, preferably through time and motion studies or in consultation withrepresentatives of workers and employer’s organization.

Furthermore, all workers paid by results, shall receive NOT LESS THAN THEAPPLICABLE STATUTORY MINIMUM WAGE RATES for normal working hours whichshall not exceed eight hours a day or a proportion thereof for work less than the normalworking hours.

WHO IS A “PROJECT EMPLOYEE”?

A project employee is one whose period of employment has been fixed for specificproject or phase thereof, the completion or termination of which has been pre-determinedat the date he was hired. He may be transferred from one project to another whether onregular or irregular basis but is required that (1) such project employee should beterminated at the completion of each project or phase thereof. (2) Further, that eachterminated is reported to the Public Employment Office of the DOLE regional office forstatistical purposes and as indicator that, indeed, the worker is a project employee. 47

EXAMPLE: Kulas may be hired merely for painting work of one project (a building). Uponcompletion of the painting of the building, his employment must be terminated. Should the workerbe needed again, for say, carpentry work in another project (another building), he must be rehiredunder another contract. A project employee cannot be deemed to have been hired for a series ofprojects especially if each project is expected to be for long duration. 48

CITE THE INDICATORS OF “PROJECT EMPLOYMENT”

They are:

1. The duration of the specific/identified undertaking for which the worker is engaged isreasonably determined;

2. Such duration, as well as the specific work/service to be performed, is defined in anemployment agreement and is made clear to the employee at the time of hiring;

3. The work/service performed by the employee is in connection with the particularproject/undertaking for which he is engaged;

4. The employee, while not employed awaiting engagement, is free to offer his servicesto any other employer;

5. The termination of his employment in the particular project/undertaking is reported tothe DOLE Regional Office having jurisdiction over the workplace within thirty (30)days following the date of his separation from work using the prescribed form onemployees’ termination/dismissal/suspension;

47 Department Order No. 19 [1993]48 Nogante vs. NLRC, 185 SCRA 21 [1990]

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6. An undertaking in the employment contract by the employer to pay completion bonusto the project employee as practiced by most construction companies. (optional). 49

NOTES: Employers, especially in the construction industry, must file as many reports ontermination as there are construction projects actually finished to show that in fact his workers areproject employees who were hired and rehired for various projects and/or other phases thereof.Failure to do so could mean that his workers are truly regular employees. 50

WHO IS A “CONTRACTUAL EMPLOYEE”?

He is one whose work is for a short duration and the work assignment may possibly berelated to the usual business or trade of the employer.

NOTES: If the worker is hired and re-hired in different periods to do the same work for theemployer, it is sufficient proof of the necessity and indispensability of the service. When suchwork exceeds One (1) year, an employee may be entitled to be considered a REGULARemployee.

For Example: Jimmy Calamba was hired by the Baguio Country Club to do various taskintermittently as gardener, laborer and dishwasher. He was hired and re-hired for more than one(1) year. The Supreme Court held: Although the employee was hired for Fixed Periods butrepeatedly hired until he accumulated more than one year of service, the continuing need for hisservices were sufficient evidence of the necessity and indispensability of his services to thebusiness of his employer. Jimmy Calamba was considered as a regular employee. 51

WHO IS A PROBATIONARY EMPLOYEE?

A probationary employee is one on trial by an employer during which the employerdetermines whether or not he is qualified for permanent employment. A probationaryappointment is made to afford the employer an opportunity to observe the fitness of aprobationary employee while at work, and to ascertain whether he will become a properand efficient employee. 52

WHAT ARE THE RIGHTS, IF ANY, OF A PROBATIONARY EMPLOYEE?

Probationary employees, notwithstanding their limited tenure, are also entitled to securityof tenure. Thus, except for just cause as provided by law, or under the employmentcontract, a probationary employee cannot be terminated. 53

WHEN MAY A PROBATIONARY EMPLOYEE BE TERMINATED?

A probationary employee may be terminated on two (2) grounds:

1. For just cause; or

49 Samson vs. NLRC, et.al. 253 SCRA 112 [1996]50 Violeta vs. NLRC, 280 SCRA 500 [1997]; Philippine National Construction Corp. vs.NLRC, 174 SCRA 191 [1989]51 Baguio Country Club Corporation vs. NLRC, 206 SCRA 643 [1992]52 International Catholic Migration Commission vs. NLRC, GR No. 72222, January 30,1989; in rel. to Article 281, Labor Code of the Philippines, as amended53 Phil. Federation of Credit Cooperatives vs. NLRC, GR No. 1210701, December 11,1998

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2. When he fails to qualify as a regular employee in accordance with reasonablestandards made known by the employer to the employee at the time of hisengagement. 54

WHAT IS THE PURPOSE OF PROBATIONARY EMPLOYMENT?

The purpose is to afford the employer the opportunity to observe the fitness of theemployee while at work and to ascertain whether he will become a proper and efficientemployee.

DOES THE WORD “PROBATIONARY” REFER TO THE LENGTH OF PERIOD?

No. The word probationary referes to the PURPOSE of the trial period and not its length.

NOTES: On the part of the employee during the probationary period, he will seek to proveto the employer that he has the qualifications and skills necessary to met reasonable standardsmade known to him by the employer on the date he was hired. 55

MAY THE PARTIES OT A COLLECTIVE BARGAINING AGREEMENT AGREE ON A LONGERPERIOD OF PROBATIONARY EMPLOYMENT, SAY EIGHTEEN (18) MONTHS?

Yes, if the probationary employee is covered by a duly approved apprenticeshipagreement in a job calling for more than three (3) months to obtain proficiency viapractical training on the job supplemented by related theoretical instruction and only in“highly technical industries”. This is referred to as an apprenticeable occupation. 56

WHAT IS AN APPRENTICEABLE OCCUPATION UNDER THE TESDA LAW?

It is an occupation officially endorsed by a Tripartite body and approved forapprenticeship by the Authority. 57

WHAT IS “TRIPARTISM”?

Tripartism, as contemplated in our labor laws, is representation of the three sectors – thepublic or the government, the employer, and the workers – in policy making bodies of thegovernment.

EXAMPLES where tripartism is some government agencies or instrumentalities areobserved:

1. National Labor Relations Commission;2. National Wages and Productivity Board;3. Employees Compensation Commission;4. POEA Governing Board;5. Philippine Health Insurance Corporation;6. Social Security Commission; and7. GSIS Board of Trustees.

54 Philippine Manpower Services vs. NLRC, 224 SCRA 69155 International Catholic Migration Commission vs. NLRC, 169 SCRA 606 [1989]56 Article 58 (c), Labor Code of the Philippines, as amended.57 Section 4 (m) RA 7796 or the TESDA Law

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IS “TRIPARTISM” AS A KIND OF REPRESENTATION IN POLICY MAKING BODIES OFPRIVATE ENTERPRISES ORDAINED?

No. What is provided for, for the private sector, is worker’s participation in policy anddecision making processes directly affecting their rights, benefits, and welfare underArticle 211 and 255 of the Labor Code. But such participatory right does not meanrepresentation or membership in the corporate board.

NOTES: Better Still, know your Labor Code provision on tripartism by heart.

“ARTICLE 275. Tripartism and tripartite conferences. —

(a) Tripartism in labor relations is hereby declared a State policy. Towards this end, workers andemployers shall, as far as practicable, be represented in decision and policy-making bodiesof the government.

(b) The Secretary of Labor and Employment or his duly authorized representatives may from timeto time call a national, regional, or industrial tripartite conference of representatives ofgovernment, workers and employers for the consideration and adoption of voluntary codes ofprinciples designed to promote industrial peace based on social justice or to align labormovement relations with established priorities in economic and social development. In callingsuch conference, the Secretary of Labor and Employment may consult with accreditedrepresentatives of workers and employers. (As amended by RA 6715) “

HOW LONG IS THE PROBATIONARY PERIOD OF PROFESSORS, INSTRUCTORS ANDTEACHERS IN PRIVATE SCHOOLS?

Three (3) years pursuant to paragraph 76 of the Manual of Regulations for Private Schools, to wit:“Full time teachers who have rendered three consecutive years of satisfactory service shall beconsidered permanent.”

WHAT ARE THE REQUISITES FOR A TEACHER IN THE PRIVATE SECTOR TO ACQUIREPERMANENT EMPLOYMENT?

(a) The teacher is a full time teacher;(b) The teacher must have rendered three (3) consecutive years of service; and(c) Such service must have been satisfactory.

WHO IS A “FULL TIME TEACHER”?

He is one whose total working day is devoted to the school, has no other regularremunerative employment, and is paid on a regular monthly basis regardless of thenumber of teaching hours.

IN COLLEGE, WHAT IS THE NORMAL TEACHING LOAD OF A FULL TIME INSTRUCTOR?

It shall be eighteen (18) hours a month.

NOTES: A part time member of the faculty cannot acquire permanent employment underthe Manual of Regulation for Private Schools in relation to the Labor Code.

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MAY AN EMPLOYER AND THE EMPLOYEE VALIDLY AGREE TO EXTEND THEPROBATIONARY PERIOD BEYOND SIX (6) MONTHS?

Yes. Such extension is valid if voluntarily agreed by both parties to afford the employee asecond chance to make good after having initially failed to prove his worth as anemployee. By voluntarily agreeing to an extension of the probationary period, theemployee affected in effect waived any benefit attaching to the completion of said periodif he still failed to make the grade during the period of extension. Nothing in the lawprohibits such a waiver for probationary employee to improve and further his prospects ofdemonstrating his fitness for regular employment. 58

WHO IS A “SEASONAL EMPLOYEE”?

Is one who is hired to perform a task, the completion of which is pre-determined on the date he ishired and the task is seasonal in nature and the employment is for the duration of the season.

EXAMPLES:1. Sales clerks hired during Christmas holidays or during a peak sales period;2. In agricultural undertakings when worker are hired to plant or harvest in the sugar, rice orcoconut industry.

ILLUSTRATIVE CASE: Seasonal Employee

FACTS: Maria was hired as a typist to help unclog theemployer’s files and is to handle the work brought about by theseasonal increase in the volume of clerical work;

She was required to work beyond six (6) months.

Question: is Maria a “Seasonal Employee”?

Held: No. Maria cannot be considered as seasonal employeesince clerical work is necessary and desirable in maintaining thebusiness of the employer. She is a probationary employee whowill become regular after the expiration of six (6) months. 59

WHAT ARE THE BASIC LABOR STANDARDS BENEFITS OR THE BASIC TERMS ANDCONDITIONS OF EMPLOYMENT OF SECURITY GUARDS?

Their employment status, terms and conditions of employment and the responsibilities ofsecurity service contractors (private security agencies) are provided and defined byDepartment Order No. 14 s. 2001, Guidelines Governing the Employment and WorkingConditions of Security Guards and Similar Personnel in the Private Security Industry.

The basic terms and conditions of employment of security guards are enumerated below:

a. Security guards must be duly licensed and must have passed physical and neuro-physical examination required by PNP to entitle them to all benefits under the Labor

58 Mariwasa Manufacturing, Inc. vs. Leogardo Jr. GR No. 74246, January 26, 198959 Beta Electric Corporation vs. NLRC, 182 SCRA 384 [February 15, 1990]

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Code and other laws, including coverage of SSS, ECC, Philhealth and HDMF (Pag-ibig);

b. Basic wage of security guards shall not be less than the minimum wage rate for non-agricultural sector in the region where is assigned.

c. Statutory benefits.

1. Basic salary for all actual work days and for the ten (10) regular holidays;2. Allowance, if any, is prescribed by the applicable Regional Wage Order;3. Premium pay of thirty percent (30%) of the daily rate for wok on special

holidays and rest days and an additional fifty percent (50%) whenever workis performed during rest days and special holidays;

4. Overtime pay for work rendered beyond eight (8) hours equivalent to atleast twenty five percent (25%) of the regular wage plus thirty percent(30%) if performed on regular holidays or on special holidays;

5. Night shift differential pay equivalent to ten percent (10%) of the regularhourly rate for work rendered between 10:00pm to 6:00am the followingday;

6. Five (5) days per year service incentive leave, when qualified (leave withpay);

7. Seven (7) days paternity leave for married guards;8. 13th month pay (1/12 of annual basic salary);