1. Atty. Apollo X.C.S. SangalangPoLBusiness Lawyer & Legal Coach

2. No lawyer-client relationship. Consult your own legal counsel. Remember: legal opinions differ. Respect the sub judice rule. Avoid conflicts of interest. 3. Nancy S. Montinola-versus-Philippine AirlinesG.R. No. 198656September 8, 2014Supreme Court of the Philippines 4. https://www.facebook.com/legalcoach- Learn somethingnew daily (and forfree!).- Links to resources,sites, and events foreasy access.- Free quick consultations (thru private message). 5. This seminar is INTERACTIVE 6. 3 Key Words Company POLICY ADMINISTRATIVE Investigation PROGRESSIVE Discipline 7. Whats the basis? 8. Employers Rights? Law on Ownership (Civil Code):The owner has the right to enjoy and dispose of athing, without other limitations other than thoseestablished by law. (Art. 428, Civil Code). A thing can be: Physical Capital (e.g. land, building, equipment) Financial Capital (e.g. financing) Intellectual Capital (e.g. business model) Human Capital (e.g. organization) 9. Employers Rights? Law on Contracts (Civil Code):The contracting parties may establish suchstipulations, clauses, terms and conditions as maybe deemed convenient, provided they are notcontrary to law, morals, good customs, publicorder, or public policy. (Art. 1306, Civil Code) Employment is a contract. 10. Employer Power EquationOwnership Contracts Power 11. Employer Power! Law on Management Prerogative:The State recognizes the indispensable role ofthe private sector, encourages privateenterprises, and provides incentives to neededinvestments. (Sec. 20, Art. II, Constitution)The Statex x x recognizing the right ofenterprises (1) to reasonable returns oninvestments, and (2) to expansion and growth.(Sec. 3, Art. XIII, Constitution) 12. Management Prerogative1. Right to hire employees of their(employers) own choice;1. Right to fire (and discipline) them;1. Right to determine their compensationand benefits; and1. Right to control their employees. 13. Whats the problem? 14. Whats the purpose? 15. Whats the purpose? The purpose of an AdministrativeInvestigation or AI is to support adecision to impose or not to imposedisciplinary action. The goal is to impartially gather andcompile all relevant evidence. Conduct problems are the scope of AI. 16. Whats the problem? 17. Limitation No. 1 Article 291 paragraph 2, Labor Code (Formerly Article 277) 18. Limitation No. 2 Article 4, Labor Code 19. Full Protection EquationBurdenof ProofAllDoubtsE.A.P.G. 20. 3 Ways to Investigate, Disciplineand Terminate Employees Efficient but NOT necessarily legal. Legal but NOT necessarily effective. Effective (which is more than legal). 21. 3 Reasons to Avoid ILLEGALDismissal Cases Monetary and Business Costs. Emotional, Mental, Physical andSpiritual Costs. Social and Macro-Economic Costs. 22. 3 Most Fearsome Monetaryand Business COSTS Reinstatement. Backwages. Damages. 23. 3 Hidden Monetary andBusiness COSTS Direct Costs of Litigation. Indirect Costs of Litigation. Business Losses and Closure. 24. 3 Kinds of Workers to I.D.T. Employees guilty of JUST CAUSE. Employees NOT guilty of just cause. Workers who are NOT employees. 25. 3 Kinds of Employees whoare Guilty of Just Cause Guilty under Article 296 Labor Code. Guilty under Causes Analogous. Guilty under Company Policy. 26. Article 296*, Labor Code1. Serious misconduct;2. Willful disobedience (or insubordination);3. Gross and habitual neglect of duties;4. Fraud;5. Willful breach of trust; and6. Crime against person of the employer orhis immediate family or representatives. 27. Causes Analogous1. Loss of trust;2. Gross negligence coupled with a graveconsequence;3. Incompetence without improvement;4. Habitual commission of minor offenses;and5. Unfit for continued employment based onthe Totality of Infraction doctrine. 28. Company Policy Causes Analogous is the LEGAL BASISfor employers to create new offensespenalized by termination. New offenses must have the samegravity as the offenses in Article 296. Must be written, well defined andcirculated (e.g. Employee Handbook). 29. Other Problem Employees1. Employee isnt the problem (what then?);2. Problem employee, yes; but he isntdismissible (yet);3. Problem employee, yes; but he can besevered without firing him;4. Employee who lacks motivation or skills;and5. Non-employee worker; 30. 3 Ways to I.D.T. Efficient (but not necessarily legal). Legal (but not necessarily effective). Effective (which must also be legal). 31. Legal Way To I.D.T. Substantive Due Process. Procedural Due Process. Substantial Evidence. 32. SubstantiveDueProcess Just Cause Reasonableness Good FaithProceduralDueProcess Notice to Explain Notice of Hearing Notice ofTerminationSubstantialEvidence Proof of SubstantiveDue Process Proof of ProceduralDue Process Proof of Good FaithLEGALWAY 33. Substantive Due Process Just Cause. Reasonableness. Good Faith. 34. Substantive Due Process JUST CAUSE:based on Article 296*, Labor Code.based on Causes Analogous.must overcome:Security of Tenure. 35. Article 296*, Labor Code1. Serious misconduct;2. Willful disobedience (or insubordination);3. Gross and habitual neglect of duties;4. Fraud;5. Willful breach of trust; and6. Crime against person of the employer orhis immediate family or representatives. 36. Causes Analogous1. Loss of trust;2. Gross negligence coupled with a graveconsequence;3. Incompetence without improvement;4. Habitual commission of minor offenses;and5. Unfit for continued employment based onthe Totality of Infraction doctrine. 37. Substantive Due Process REASONABLENESS:Penalty is proportionate to theoffense.Offense is NOT against Law orPublic Policy.Offense is business-related oremployment-connected. 38. Substantive Due Process GOOD FAITH:Good faith is presumed.Bad faith must be proven.But in labor law, its the reverse!Because ALL DOUBTSfavor employees! 39. Procedural Due Process Notice to Explain. Notice of Hearing. Notice of Termination. 40. Procedural Due Process NOTICE TO EXPLAIN: Describes the who, what, when, where,why and the how much or the manner theoffense was committed. Gives at least 5 DAYS to submit thewritten explanation. Specifies TERMINATION as possiblepenalty, if found guilty. 41. Procedural Due Process NOTICE OF HEARING: Gives opportunity to the employee toverbally explain his side and present hisevidence. States that he has right to counsel orrepresentative of his own choice. Lays down the hearing procedure. 42. Procedural Due Process NOTICE OF TERMINATION:Summarizes what happened since thestart of the disciplinary process.Enumerates the basis of the decision. States the verdict clearly, includingmonetary liability (if any); and advisesemployee of the next step. 43. Substantial Evidence Proof of substantive due process. Proof of procedural due process. Proof of good faith. 44. Substantial Evidence PROOF OF SUBSTANTIVE DUEPROCESS: Offense is defined and justified. Employee committed the offense. Affidavits and Testimonial Evidence. Admissions. Documentary Evidence. Object Evidence. 45. Substantial Evidence PROOF OF PROCEDURAL DUEPROCESS: Notices are written and served. Personal service. Substituted service. Hearings are recorded. Attendance. Minutes. 46. Substantial Evidence PROOF OF GOOD FAITH:Show the effect of the offense on theorganization or on the business.Show that you walked the Extra Mile. Because employers have theBURDEN OF PROOF*. Because ALL DOUBTS favor theemployees. 47. SubstantiveDueProcess Just Cause Reasonableness Good FaithProceduralDueProcess Notice to Explain Notice of Hearing Notice ofTerminationSubstantialEvidence Proof of SubstantiveDue Process Proof of ProceduralDue Process Proof of Good FaithLEGALWAY 48. CONSTRUCTIVE DISMISSAL A form of ILLEGAL TERMINATION; No formal termination or disciplinaryproceeding was initiated; No due process; Presumably, no just orauthorized cause as well. Employee was forced to resign because: Demotion or diminution of benefits; or Impossible or unbearable for the employee tocontinue with his employment; or Directed by the employer to resign. 49. PREVENTIVE SUSPENSIONGround: Serious and imminent threat to the: Life and/or property of the Employer and/or co-workers.Maximum period: 30 days.Otherwise, it shall be CONSTRUCTIVE DISMISSAL.Ideally, the Notice of Preventive Suspension is incorporated in theNotice to Explain (or 1st Notice) issued to the employee.It may be credited to the penalty of suspension, if Employee isfound guilty of an offense punishable with suspension. 50. TEMPORARY TRANSFERRequirements: Genuine business need or necessity; Good faith; No undue hardship upon employee; and Not meant as a form of penalty.Otherwise, the transfer will be considered as a form ofCONSTRUCTIVE DISMISSAL.If there is just cause, transfer may be resorted to as analternative to preventive suspension; but adisciplinary proceeding must be initiated. 51. Effective Way Legal Way isnt enough. Why? Because Filing a labor case is so easy and its free; An employee who felt mistreated will try tovindicate himself or get even; A guilty employee will try to save face; Many lawyers, paralegals, and laborleaders accept contingency fees. 52. Whats the Effective Way?D.O.C.U.M.E.N.T. 2013GOODFAITH 53. How to D.O.C.U.M.E.N.T. 2013D ocumentation, documentation, documentation!!!O pen-mindedness.C larity.U nderstand LR principles.M aster HR.E mbrace best practices: Progressive DisciplineN egotiate, negotiate, negotiate!!!T ake advice only from experts. 54. Documentation X 3 Pre-Employment Documentation. Employment Documentation. Pre-Termination & PostEmployment Documentation. 55. Open-Mindedness Be tolerant with your employees. Be receptive to new ideas andpossibilities. Be accepting of the outcome. 56. Clarity Clarity in written communication. Clarity in talk and action. Clarity in purpose and objective. 57. Understand ER/LR Understand that:1. ER/LR is a Game.1. the Rules of the Game.1. the Goals of the Game. 58. Master HR ER/LR is essentially HR. HR is exemplified by MR. MR is enhanced by GR. 59. WHAT IS GOOD FAITH? 60. Anatomy of a Labor DisputeCapitalist Worker 61. Evolution of Work ArrangementSlaverySerfdomContractual 62. Capitalism 63. Capitalist ModelSocialBenefitsFreeMarketCompetition 64. Communism 65. Capitalist ExploitationProfit,Expansion andGrowthWorkersCompensationand Benefits 66. Revolution!!!SocialistDemocratic 67. Socialist ModelPeoples OwnershipManagementsStewardshipPartysGuardianship 68. Democratic ModelEliteClassMiddleClassWorking Class 69. Labor Law Revolution!Unionism +StrikeLaborStandardsSocialJusticeSecurity ofTenure 70. Shared Responsibility ModelBusinessLaborProgressandDevelopment 71. Tripartite ModelGovernmentLabor Business 72. What is Social Justice?Business Labor 73. Rule of LawConstitutionLaws (including Labor Laws)Rules & RegulationsJurisprudencePublic Policiesand Principlesof EquityContractsCompanyPolicies 74. Elements of Labor LawLaborLawSharedResponsibilitySocialJusticeRule ofLaw 75. Anatomy of a Labor DisputeCapitalist Worker 76. Win-Win Lose-WinConflictResolutionScenariosWin-Lose Lose-Lose 77. 3 Kinds of Win Scenarios Win Lose Compromise (or Half-baked Win) Win Win (Mindset)Think Win-Win by Steven Covey 78. 3 Ways To Win By Hook or by Crook. Out Last. Out Wit. Out Pay!(Survivor). WIN with INtegrity (WIn-wIN). Its more than just winning legally. 79. Why WIn-wIN? I cant compartmentalize my life. I cant justify the means with the end. I reaped what Ive sown. I almost lost my soul. 80. Whats WIn-wIN? what king would go to war againstanother king without first sitting down withhis counselors to discuss whether his armyof 10,000 could defeat the 20,000 soldiersmarching against him? And if he cant, hewill send a delegation to discuss terms ofpeace while the enemy is still far away.- Jesus Christ(Luke 14:31-32 NLT) 81. How to WIn-wIN?D.O.C.U.M.E.N.T. 2013GOODFAITH 82. How to D.O.C.U.M.E.N.T. 2013D ocumentation, documentation, documentation!!!O pen-mindedness.C larity.U nderstand LR principles.M aster HR.E mbrace best practices: Progressive DisciplineN egotiate, negotiate, negotiate!!!T ake advice only from experts. 83. Embrace Best Practices Good Practices. Better Practices. Best Practices:PROGRESSIVEDISCIPLINE 84. Embrace Best PracticesPROGRESSIVE DISCIPLINESystemMindsetDocumentation 85. Progressive Discipline Mindset1. Do no harm.2. Make things better.3. Respect others.4. Be fair.5. Be compassionate. 86. Progressive DisciplineDefinition:It is a system of discipline where penalties increaseupon repeat occurrences.Purpose:It primarily aims to correct the negative behaviorrather than to punish the erring employee.Range of Responses:1. Counseling or coaching.2. Verbal warning.3. Written warning.4. Suspension or demotion or fine or forfeiture.5. Performance Improvement Plan.6. Termination. 87. Progressive DisciplineAdvantages:1. It addresses the silence of the Labor Coderegarding Incompetence as a ground fortermination.2. It helps the Employer document habitualnegative behaviors, which is essential inestablishing Gross and HabitualNegligence as a ground for termination.3. It helps the Employer prove that he was inGood Faith in dealing with the Employee. 88. Progressive DisciplineAdvantages (continuation):4. It helps build up a case for Analogous Causeas a ground for termination.5. Since it is corrective in approach, it helpspreserve the existing members of the team whileimproving their performance and behavior.6. It saves the Employer costly recruitment andtraining expenses for new hires, as well asprevents downtime due to vacancies.7. It promotes Employee morale. 89. Progressive DisciplineRequirements:1. Employee Manual (with List of Offenses andPenalties).2. Step-by-step Implementation Guide.3. Training for Managers and Supervisors.a. Counseling or Coaching Skills.b. Verbal and Written Warnings.c. Performance Improvement Plan.4. Employee Interview Log Sheets.5. 201 File.6. Templates and Scripts. 90. Progressive Discipline Process1. Pre-Investigation Stage.a. Prepare: Company Policies and Employee Manual.b. Prepare: Employment Contracts and 201 File.c. Progressive Discipline: Train the Managers.d. Progressive Discipline: Counsel or Warn Employees.e. Preliminary: Fact-finding Activities.2. Investigation Proper.a. Start: Notice to Explain or Show Cause Memo.b. Progressive Discipline: Performance Improvement Plan.c. End: Notice of Decision.3. Post-Investigation Stage.a. Review: Company Policies and Employee Manual.b. Review: Employment Contracts and 201 File.c. Progressive Discipline: Re-train the Managers. 91. Pre-InvestigationCoaching/CounselingPIPInvestigation1st NoticePost-InvestigationInvestigation2nd Notice 92. How to D.O.C.U.M.E.N.T. 2013D ocumentation, documentation, documentation!!!O pen-mindedness.C larity.U nderstand LR principles.M aster HR.E mbrace best practices: Progressive DisciplineN egotiate, negotiate, negotiate!!!T ake advice only from experts. 93. Negotiate X 3 Negotiate before a labor dispute. Negotiate during a labor dispute. Negotiate after a labor dispute. 94. Take advice only from experts Licensed or seasoned experts. Local labor law experts. Practical and trust-worthy experts. 95. ER Best Practices Probationary Employment. Code of Discipline. Code of Ethics. 96. HR Best Practices Performance Appraisal. Performance Improvement Plan. Performance-based Rewards. 97. LR Best Practices Walk-in Compromise Settlement. SEnA (Single Entry Approach). The Cordial Resignation Letter. 98. Ethical Best Practice Human Relations, Civil Code: Article 19. Every person must, in theexercise of his rights and in theperformance of his duties, act withjustice, give everyone his due, andobserve honesty and good faith. 99. Progressive Discipline Mindset1. Do no harm.2. Make things better.3. Respect others.4. Be fair.5. Be compassionate. 100. Rotarys4-WayTestTruthHow?FairGoodwill andBetter FriendshipsBeneficial 101. Spiritual Best Practices For the whole law can besummed up in this onecommand: "Love yourneighbor as yourself. Galatians 5:14, The Bible (New Living Translation) 102. LABOR LAW MADE EASY(a Facebook page) https://www.facebook.com/legalcoachLIKECOMMENTSHARETAG