San Miguel Corp v. NLRC & Maliksi, GR No. 147566, Dec. 6, 2006

The act if hiring and re-hiring the petitioners over a period of time without considering them as regular employees evidences bad faith on the part of private respondent. Regularization is a labor benefit that should apply to all qualified employees similarly situated and may not be denied merely because some employees were allegedly not parties to or were not impleaded in the voluntary arbitration case. It must be noted that the Court extended the benefit of regularization not only to the original complainants but also to those workers who are similarly situated to therein complainants.

LIIKHA-PMPB v. Burlinggame corp., GR No. 162833, June 15, 2007

Job contracting is permissible only if the following conditions are met: 1) the contractor carries on an independent business and undertakes the contract work on his own account under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof; and 2) contractor has substantial capital or investment in the form of tools, equipment, machineries, work premises, and other materials which are necessary in the conduct of the business. Mentioned sec. 5 of DO 18-02 which states the prohibition against labor-only contracting (see DO)Promo-girls were directly related to the principal business or operation of Burlingame. Marketing and selling of products is an essential activity to the main business of the principal. In labor-only contracting, the law creates an employer-employee relationship to prevent a circumvention of labor laws. The contractor is merely an agent of the principal employer and the latter is responsible to the employees of the labor-only contractor as if such employees had been directly employed by the principal employer.

Coca-Cola Bottlers Phil., Inc. v. NLRC, 307 SCRA 131 (1999)

mentioned Singer Sewing Machine vs Drilon: the definition that regular employees are those who perform activities which are desirable and necessary for the business of the employer is not determinative in this case. Any agreement may provide that one party shall render services for and in behalf of another for a consideration (no matter how necessary for the latters business) even without being hired as an employee. This is precisely true in the case of an independent contractorship as well as in an agency agreement. Art 280 is not the yardstick for determining the existence of an employment relationship because it merely distinguishes between two kinds of employees i.e. regular and casual for purposes of determining the right of an employee to certain benefits, to join or form a union or to security of tenure. Art 280 does not apply where the existence of an employment relationship is in dispute (compare with Manila Water)Painting jobs performed we sporadic. The infrequency or irregularity of assignments countervails Canonicatos submission that he was assigned to undertake the task for the whole year round. Manila Water Co., Inc. v. Pena, 434 SCRA 52 (2004)

ACGI was engaged in labor-only contracting and as such, is considered merely an agent of the petitioner. In labor-only contracting, the statute creates an employer-employee relationship for a comprehensive purpose: to prevent a circumvention of labor laws. The contractor is considered merely an agent of the principal employer and the latter is responsible to the employees of the labor-only contractor as if such employees had been directly employed by the principal employer. Private resp performed activities which were necessary or desirable to its principal trade or business. Thus, they were regular employees of petitioner regardless of whether the engagement was merely an accommodation of their request pursuant to Art. 280 (compare with Far East Bank-blind employees).Art. 280: the provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer, except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment is for the duration of the season. Under this provision, the evil sought to be prevented is singled out: agreements entered into precisely to circumvent security of tenure. It has no application where a fixed period of employment was agreed upon knowingly and voluntarily by the parties, without any force, duress or improper pressure being brought upon the employee and absent any circumstances vitiating his consent, or where it satisfactorily appears that the employer and employee dealt with each other on more or less terms with no moral dominance whatever being exercised by the former over the latter.Under 279 of LC, an employee who is unjustly dismissed form work is entitled to reinstatement without loss of seniority rights and other privileges, and to his full back wages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement. If reinstatement is no longer possible, the employer has the alternative of paying the employee his separation pay in lieu of reinstatement. Lanzaderas v. Amethyst Security & General Services, Inc.,

The only time the indirect employer may be made solidarily liable with the contractor is when the contractor fails to pay his employees their wages and other benefits claimed. Security of tenure, although provided in the Constitution, does not give an employee an absolute vested right in a position as would deprive the company of its prerogative to change their assignment or transfer them where they will be most uselful. When a transfer is not unreasonable, nor inconvenient, nor prejudicial to an employee; and it doesn not involve a demotion in rank or diminution of his pay, benefits, and other privileges, the employee may not complain that it amounts to a constructive dismissal. San Miguel Corporation v. Abella, 461 SCRA 392 (2005)

effect of finding: there being a finding of labor-only contracting, liability must be shouldered by either SMC (principal) or Sunflower (contractor) or shared by both. SMC however should be held solely liable for Sunflower became non-existent with the closure of the aquaculture of business of SMC (CA reason).In legitimate labor contracting, the law creates an employer-employee relationship for a limited purpose, i.e. to ensure that the employees are paid their wages. The principal employer becomes jointly and severally liable with the job contractor, only for the payment of the employees wages whenever the contractor fails to pay the same. Other than that, the principal employer is not responsible for any claim made by the employees. In labor-only contracting, the statute creates an employer-employee relationship for a comprehensive prupose: to prevent a circumvention of labor laws. The contractor is considered merely an agent of the principal employer and the latter is responsible to the employees of the labor-only contractor as if such employees had been directly employed by the principal employer. Retrenchment is a management prerogative consistently recognized and affirmed by this Court. It is, however, subject to faithful compliance with the substantive and procedural requirements laid down by law and jurisprudence. For retrenchment to be considered valid, the following substantial requirements must be met:the losses expected should be substantial and not merely de minimis in extentsubstantial losses apprehended must be reasonably imminent such as can be perceived objectively and in good faith by the employerthe retrenchment must be reasonably necessary and likely to effectively prevent the expected lossesthe alleged losses, if already incurred, and the expected imminent losses sought to be forestalled, must be proved by sufficient and convincing evidence.

SMC proved substantial business reverses justifying retrenchment of its employeesFor termination due to retrenchment be valid, the law requires that written notices of the intended retrenchment be served by the employer on the worker and on the DOLE at least 1 month before the actual date of the retrenchment in order to give employees some time to prepare for the eventual loss of their jobs, as well as to give DOLE the opportunity to ascertain the verity of the alleged cause of termination. Where the dismissal is based on an authorized cause under Art 283 but the employer failed to comply with the notice requirement, the sanction should be stiff as the dismissal process was initiated by the employers exercise of his management prerogative, as opposed to a dismissal based on a just cause under 282, because the dismissal is imputable to the employee. Almodiel v. NLRC, 223 SCRA 341 (1993)

Redundancy for purposes of our Labor Code, exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. The characterization of an employees services as no longer necessary or sustainable, and therefore, properly terminable, was an exercise of business judgment on the part of the employer. The wisdom or soundness of such characterization was not subject to discretionary review on the part of the LA nor of the NLRC so long, of course, as violation of law or merely arbitrary of malicious action is not shown. In International Macleod vs IAC, it was held that the determination of the need for the phasing out of a department as a labor and cost saving device because it was no longer economical to retain said services is a management prerogative and the courts will not interfere with the exercise thereof as long as no abuse of discretion or merely arbitrary or malicious action on the part of management is shown. An employer has a much wider discretion in terminating employment relationship of managerial personnel compared to rank and file because officers in such key positions perform not only functions which by nature require the employers full trust and confidence but also functions that spell the success or failure of an enterprise. On Alien Employment: a resident alien without a working permit is not what is prohibited in Art 40. The provision requires employment permit to non-resident aliens. The employment permit is required for entry into the country for employment purposes and is issued after determination of the non-availability of a person in the Philippines who is competent, able and willing at the time of application to perform the services for which the alien is desired. General Milling Corp. v. Torres, 196 SCRA 215 (1991)

GMCs claim that hiring of a foreign coach is an employers prerogative has no legal basis. Art. 40 states that an employer seeking employment of an alien must first obtain an employment permit from the DOLE. GMCs right to choose is limited by the statutory requirement of an alien employment permit. The Labor Code empowers the Secretary to make a determination as to the availability of the services of a person in the Philippines who is competent, able and willing at the time of application to perform the services for which an alien is desired. DOLE is the agency vested with jurisdiction to determine the question of availability of local workers. Nitto Enterprises v. NLRC, 258 SCRA 654 (1995)

Art 61 of the LC provides: contents of apprenticeship agreement. Apprenticeship agreements, including the main rates of apprentices, shall conform to the rules issued by the Minister of Labor and Employment. The period of apprentices shall not exceed six months. Apprenticeship agreements providing for wage rates below the legal minimum wage, which in no case shall start below 75% per cent of the applicable minimum wage, may be entered into only in accordance with apprenticeship program duly approved by the Minister of Labor and Employment. The Ministry shall develop standard model programs of apprenticeship. It is mandated that apprenticeship agreements entered into by the employer and apprentice shall be entered only in accordance with the apprenticeship program duly approved by the Minister of Labor and Employment. Prior approval by the DOLE of the proposed apprenticeship is, therefore, a condition sine qua non before an apprenticeship agreement can be validly entered into. The act of filing the proposed apprenticeship program with DOLE is a preliminary step towards its final approval and does not instantaneously give rise to an employer-apprentice relationship. Hence, apprenticeship agreement bet petitioner and private resp has no force and effect in the absence of a valid apprenticeship program duly approved by the DOLE. Art. 280 is cited. Twin requirements of notice and hearing constitute the essential elements of due process. Bernardo v. NLRC & FEBTC, 310 SCRA 186 (1999)

The Magna Carta for Disabled Persons mandates that qualified disabled persons be granted the same terms and conditions of employment as qualified able-bodied employees. Once they have attained the status of regular workers, they should be accorded all the benefits granted by law, notwithstanding written or verbal contracts to the contrary. This treatment is rooted not merely on charity or accommodation, but on justice for all. The magna carta madates that a qualified disabled employee should be given the same terms and conditions of employment as a qualified able-bodied person. equal opportunity for employment as provided for by sec. 5. The fact that the employees were qualified disabled persons necessarily removes the employment contracts from the ambit of Art. 80. Since the Magna Carta accords them the rights of qualified able-bodied persons, they are thus covered by Art. 280.The test whether an employee is regular was laid down in De Leon vs. NLRC:The primary standard, therefore, of determining regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual trade or business of the employer. The test is whether the former is usually necessary or desirable in the usual business or trade of the employer. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. Also if the employee has been performing the job for at least one year, even if the performance is not continuous and merely intermittent, the law deems repeated and continuing need for its performance as sufficient evident of the necessity if not indispensability of that activity to the business. Hence, the employment is considered regular, but only with respect to such activity, and while such activity exists. Accommodated employees: this fact does not change the nature of their employment. An employee is regular because of the nature of work and the length of service, not because of the mode or even the reason for hiring them. In LT Datu v NLRC: the determination of whether employment is casual or regular does not depend on the will or word of the employer, and the procedure of hiringxxx but on the nature of the activities performed by the employee, and to some extent the length of performance and its continued existence. The noble objectives of Magna Carta for Disabled Persons are not based merely on charity or accommodation, but on justice and the equal treatment of qualified persons, disabled or not.

Manila Terminal Co. Inc. v. CIR, 91 Phil. 625 (1952)

The Association cannot be said to have impliedly waived the right to overtime compensation, for the obvious reason that they could not have expressly waived it. Principle of laches and estoppel cannot be invoked:It would be contrary to the spirit of the Eight-Hour Labor Law, under which, as already seen, the laborers cannot waive their right to extra compensation. The law principally obligates the employer to observe it, so much so that it punishes the employer for its violation and leaves the employee or laborer free and blameless.The employee or laborer is in such a disadvantageous position as to be naturally reluctant or even apprehensive in asserting any claim which may cause the employer to devise a way for exercising his right to terminate the employment. If laches and estoppel will be applied, it may bring a situation whereby the employee or laborer who cannot expressly renounce their right to extra compensation under the Eight-Hour Labor Law, may be compelled to accomplish the same thing by mere silence of lapse of time, thereby frustrating the purpose of the law by indirection.The public is interested in the strict enforcement of the Eight-Hour Labor Law. This was designed not only to safeguard the health and welfare of the laborer or employee, but in a way to minimize unemployment by forcing employers in cases where more than 8-hour operation is necessary, to utilize different shifts of laborers or employees working only for eight hours each.

Charlito Peranda v. Baganga Plywood Corp., et al., G.R. 159577, May 3, 2006Managerial employees and members of the managerial staff are exempted from the provisions of the Labor Code on labor standards. Since petitioner belongs to this class of employees, he is not entitled to overtime pay and premium pay for working on rest days. Managerial employees are those whose primary duty consists of the management of the establishment in which they are employed or of a department of subdivision. Sec. 2(c) of the Implementing Rules of LC, Book III, Rule I defines members of a managerial staff as those with the following duties and responsibilities:The primary duty consists of the performance of work directly related to management policies of the employer.Customarily and regularly exercises discretion and independent judgment.i. Regularly and directly assist a proprietor or a managerial employee whose primary duty consists of the management of the establishment in which he is employed or subdivision thereof; or ii. execute under general supervision work along specialized or technical lines requiring special training, experience, or knowledge;iii. execute under general supervision special assignment and tasks Who do not devote more than 20 percent of their hours worked in a workweek to activities which are not directly and closely related to the performance of the work described in paragraphs (1), (2) and (3) above. He admitted that he was a supervisor and his work necessarily required the use of discretion and independent judgment to ensure the proper functioning of the steam plant boiler.As a supervisor, he is deemed a member of the managerial staff. Asia Pacific Christening, Inc. v. Farolan, 393 SCRA 454 (2004)

Requisites for a valid dismissal of an employee is thus in order, to wit: the employee must be afforded due process i.e. he must be given opportunity to be heard and to defend himselfdismissal must be for a valid cause as provided in art 282 of LC or any of the authorized causes under 283 and 284 of the same CodeThe rule is settled that in termination cases, the employer bears the onus of proving that the dismissal is for just cause failing which the dismissal is not justified and the employee is entitled to reinstatement.Treatment to managerial employees:Thus with respect to rank and file personnel, loss of trust and confidence as ground for valid dismissal requires proof of involvement in the alleged events in question and that mere uncorroborated assertions and accusations by the employer will not be sufficient. But as regards a managerial employee, mere existence of a basis for believing that such employee has breached the trust of his employer would suffice for his dismissal. Samson vs NLRC: Before one may be properly considered a managerial employee, all the following conditions must be met:Their primary duty consists of the management of the establishment in which they are employed or of a department or subdivision thereof;They customarily and regularly direct the work of two or more employees therein;They have the authority to hire or fire other employees of lower rank, or their suggestions and recommendations as to the hiring and firing and as to the promotion or any other change of status of other employees are given particular weight. (SEC 2(b) Rule I, Book III of the Omnibus)In Paper Industries Corp vs Laguesma:Managerial employees are ranked as Top Mangers, Middle Mangers and First Line Managers. The mere fact that an employee is designated as manager does not ipso factor make him onedesignation should be reconciled with the actual job description of the employee for it is the job description that determines the nature of employment. The absence of a written job description or prescribed work standards, however, leaves this court in the dark. Loss of confidence should have a basis and determination thereof cannot be left entirely to the employer. Loss of trust and confidence to be a valid ground for an employees dismissal must be based on a willful breach and founded on clearly established facts. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly, and inadvertently. Failure to observe prescribed standards of work, or to fulfill reasonable work assignments due to inefficiency may be just cause for dismissal but it must be shown what standards of work or reasonable work assignment were prescribed which respondent failed to observe not that if she did fail to observe any such, it was due to inefficiency. While an employee may be dismissed because of inefficiency, neglect or carelessness, the law implies a situation or undertaking by an employee in entering into a contract of employment that he is competent to perform the work undertaken and is possessed of the requisite skill and knowledge to enable him to do so, and that he will do the work of the employer in a careful manner. If he is not qualified to do the work which he undertakes, if he is incompetent, unskillful or inefficient, or if he executes his work in a negligent manner or is otherwise guilty of neglect of duty, he may lawfully be discharged before the expiration of his term of employment. On moral damages: it must be shown that the dismissal was attended by bad faith or constituted an act opposite to labor or was done in a manner contrary to morals, good customs, or public policy. Award of moral damages and exemplary damages for an illegally dismissed employee is proper where the employee had been harassed and arbitrarily terminated by the employer. Merdicar Fishing Corp v. NLRC, 297 SCRA 440 (1998)

Art. 82 provides that the Title Working Conditions and Rest period Provisions of the LC shall not apply to:government employeesfield personnelmembers of the family of the employer who are dependent on him for supportdomestic helperspersons in the personal service of anotherworkers who are paid by results as determined by the Sec of LaborField personnel shall refer to non-agricultural employees who regularly perform their duties away from the principal place of business or branch office of the employer and whose actual hours of work in the filed cannot be determined with reasonable certainty. Rule IV, Sec. 1 (e), Book III of the IRR states that: Field personnel and other employees whose time and performance is unsupervised by the employerxxxThe latter provision did not add another element to the LC but merely interpreted and expounded the clause of the provision of the LC. Fishermen employed by petitioner have no choice but to remain on board its vessel. Although they perform non-agricultural work away from petitioners buiness offices, the fact remains that throughout the duration of their work, they are under the effective control and supervision of petitioner through the vessels patron or master. On abandonment: To constitute abandonment, there must be concurrence of the intention to abandon and some overt acts from which it may be inferred that the employee concerned has no more interest in working. The filing of complaint which asked for reinstatement plus backwages is inconsistent with resp defense of abandonment. Auto Bus Transport Systems, Inc. v. Bautista, 458 SCRA 578 (2005)

Art. 95 of the LC vis--vis Sec 1(d), RULE V, Book III of the IRR which provides:Art. 95: Right to Service Incentive LeaveEvery employee who has rendered at least one year of service shall be entitled to a yearly service incentive leave of five days with pay.And Sec 1(d) provides that: Field personnel and other employees whose performance is unsupervised by the employer includeing those who are engaged on task or contract basis, purely commission basis, or those who are paid in a fixed amount for performing work irrespective of the time consumed in the performance thereof;Amplification of the LC. Same is true to the phrase those who are engaged o task or contract basis, purely commission basis should be related with field personnel applying the rule on ejusdem generis that general and unlimited terms are restrained and limited by the particular terms that they follow. Bureau of Working Conditions (BWC), Advisory Opinion: As a general rule, field personnel are those whose performance of their job/service is not supervised by the employer or his rep, the workplace being away from the principal office and whose hours and days of work cannot be determined with reasonable certainty, hence they are paid specific amount for rendering specific service or performing specific work. If required to be at specific places at specific times, employees including drivers cannot be said to be field personnel despite the fact that they are performing work away from the principal office of the employee. In order to conclude whether an employee is a field employee, it is also necessary to ascertain if actual hours of work in the filed can be determined with reasonable certainty by the employer. In so doing, an inquiry must be made as to whether or not the employees time and performance are constantly supervised by the employer. Dispatcher: function is precisely to see that the bus and its crew leave the premises at specific times and arrive at the estimated proper time. On prescription: LC provides that all money claims arising from er-ee rel shall be filed within 3 years from the time the cause of action accrued; otherwise, they shall be forever barred. In case of nonpayment of allowances and other monetary benefits, if it is established that the benefirs being claimed have been withheld from the employee for a period longer than 3 yrs, the amount pertaining to the period beyond the three-year prescriptive period is therefore barred by prescription. The amount that can only be demanded by the aggrieved employee shall be limited to the amount of the benefits withheld within 3 years before the filing of the complaint. (In the computation of the prescriptive period, determine when the act constituting the violation was committed). On service incentive when does the prescriptive period commence?Service incentive is a curious animal. The employee may commute his accrued incentive leave upon his resignation or separation frm work. Sec 2, Rule V, Book III: Service incentive leave is a right which accrues to every employee who has served within 12 months, whether continuous or broken reckoned from the date the employee started working, including authorized absences and paid regular holidays unless the working days in the establishment as a matter of practice or policy, or that provided in the employment contract, is less than 12 months, in which case said period shall be considered as one year. It is commutable to its money equivalent if not used or exhausted at the end of the year. In other words, the employee who has served for one year is entitled to it. He may use it as leave days or he may collect its monetary value. The three-year prescriptive period commences, not at the end of the year when the employee becomes entitled to the commutation of his service incentive leave, but from the time the employer refuses to pay its monetary equivalent after demand of commutation or upon termination of the employees services as the case may be.

Labor Congress v. NLRC, 290 SCRA 509 (1998)

Battad: Determine whether the employer is using piece-rate worker status to evade liability as to the benefits to which such workers are exempted. This is similar to labor-only vs. independent contractor where factors are to be considered before we could establish which is the true status of the employees

Are the piece-rate workers entitled to overtime pay, 13th month pay, backwages, separation pay?Procedural aspect: Notice of dismissal is required Sec. 2, Rule XIV, Book V of IRR. If not complied then, Art. 279 as amended by RA 6715 shall apply. The backwages of piece-rate workers are to be determined by the NLRC because there is a need to determine the varying degrees of production and days worked by each worker. In this case, they are regular employees because of the presence of these three factors:nature of petitioners tasks: their job of repacking snack food was necessary or desirable in the usual business of private respondents, who were engaged in the manufacture and selling of such food productspetitioners worked for private respondents throughout the year, their employment not having been dependent on a specific project or seasonlength of time that the petitioners worked for private respondentsWhile petitioners mode of compensation was on a per piece basis the status and nature of their employment was that of regular employee. The IRR exclude certain employees from receiving benefits such as nighttime pay, holiday pay, service incentive leave, and 13th month pay. Petitioners as piece-rate workers do not fall within this group. Not only did petitioners labor under the control of private respondents as their employer, likewise did petitioners toil throughout the year with the fulfillment of their quota as supposed basis for compensation. Sec 8(b) Rule IV, Book II provides for holiday pay of certain employees. Revised Guidelines on the Implementation of the 13th Month Pay law, exclude employer of piece-rate workers from those exempted from paying the 13th month pay.Employers still not covered by PD 851: (d) Employers of those who are paid on purely commission, boundary or task basis, and those who are paid a fixed amount for performing specific work, irrespective of the time consumed in the performance thereof, except where the workers are paid on piece-rate basis in which case, the employer shall grant the required 13th month pay to such workers. Revised Guidelines: Workers who fall under the piece-rate category: who are paid a standard amount for every piece or unit of work produced that is more or less regularly replicated without regard to the time spent in producing the same. As to the overtime pay: Sec 2(e) Rule I, Book III compare with Sec. 8, Rule VII, Book III. If the employer adhered to Sec. 8 where the Sec of Labor would fix rates, then they are exempted.But employer did not allege adherence, thus sec 2(e) workers who are paid by results, including those who are paid on piece-work, takay, pakiao, or task basis but their employer did not comply with Sec. 8 to fall within the exception, then they are entitled to overtime pay. Philippine Airlines, Inc. v. NLRC, 302 SCRA 582 (1999)

Art. 83-Normal Hours of Work, Art. 85, Meal Periods, Sec. 7, Rule I, Book III read together. The eight-hour work period does not include the meal break. Nowhere in the law may it be inferred that employees must take their meals within the company premises. Employees are not prohibited from going out of the premises as long as they return to their posts on time. On moral damages: Bad faith involves a state of mind dominated by ill will or motive. It implies a conscious and intentional design to do a wrongful act for a dishonest purpose of some moral obliquity. Art. 83 and 85 of the Labor Code read:Art. 83. Normal hours of work. 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 (5) 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 per cent (30%) of their regular wage for work on the sixth day. For purposes of this Article, "health personnel" shall include: resident physicians, nurses, nutritionists, dieticians, pharmacists, social workers, laboratory technicians, paramedical technicians, psychologists, midwives, attendants and all other hospital or clinic personnel. (emphasis supplied)Art. 85. Meal periods. Subject to such 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.Sec. 7, Rule I, Book III of the Omnibus Rules Implementing the Labor Code further states:Sec. 7. Meal and Rest Periods. Every employer shall give his employees, regardless of sex, not less than one (1) hour time-off for regular meals, except in the following cases when a meal period of not less than twenty (20) minutes may be given by the employer provided that such shorter meal period is credited as compensable hours worked of the employee;(a) Where the work is non-manual work in nature or does not involve strenuous physical exertion;(b) Where the establishment regularly operates not less than sixteen hours a day;(c) In cases of actual or impending emergencies or there is urgent work to be performed on machineries, equipment or installations to avoid serious loss which the employer would otherwise suffer; and(d) Where the work is necessary to prevent serious loss of perishable goods.Rest periods or coffee breaks running from five (5) to twenty (20) minutes shall be considered as compensable working time.Arica v. NLRC, 170 SCRA 776 (1989)

The thirty (30)-minute assembly time long practiced and institutionalized by mutual consent of the parties under Article IV, Section 3, of the Collective Bargaining Agreement cannot be considered as waiting time within the purview of Section 5, Rule I, Book III of the Rules and Regulations Implementing the Labor Code. ...Furthermore, the thirty (30)-minute assembly is a deeply- rooted, routinary practice of the employees, and the proceedings attendant thereto are not infected with complexities as to deprive the workers the time to attend to other personal pursuits. They are not new employees as to require the company to deliver long briefings regarding their respective work assignments. Their houses are situated right on the area where the farm are located, such that after the roll call, which does not necessarily require the personal presence, they can go back to their houses to attend to some chores. In short, they are not subject to the absolute control of the company during this period, otherwise, their failure to report in the assembly time would justify the company to impose disciplinary measures. The CBA does not contain any provision to this effect; the record is also bare of any proof on this point. This, therefore, demonstrates the indubitable fact that the thirty (30)-minute assembly time was not primarily intended for the interests of the employer, but ultimately for the employees to indicate their availability or non-availability for work during every working day.

University of Pangasinan Faculty Union v. University of Pangasinan, 127 SCRA 691 (1984)

No work no pay principle does not apply in the case because the petitioners certainly do not ad voluntatem absent themselves during semestral breaks. Rather, they are constrained to take mandatory leave from work. Intention of the law to grant ECOLA upon the payment of basic wages. No pay, no ECOLA. But petitioners were paid their wages in full for the months of Nov and Dec notwithstanding the intervening semestral break. Sec. 4 of the Omni:Principles in Determining Hours Woked: (d) The time during which an employee is inactive by reason of interruptions in his work beyond his control shall be considered time either if the imminence of the resumption of work requires the employees presence at the place of work or if the interval is too brief to be utilized effectively and gainfully in the employees own interest. Semestral break may also be considered as hours worked. Sec. 3 of PD 451 on increase on tuition or other school fees conditions.In University of the East vs UE Faculty Assoc: In effect, the problem posed before Us is whether or not the reference in Sec 3(a) to increase in salaries or wages of the faculty and all other employees of the schools concerned as the first purpose to which the incremental proceeds from authorized increases to tuition fees may be devoted, may be construed to include allowances and benefits. In the negative, which is the position of resp, it would follow that such allowances must be taken from resources of the school not derived from tuition fees. Xxx We note that among the items of the second purpose stated in provision in question is return in investment. And the law provides only for the maximum, not a minimum. In other words, the schools may get a return to investment of not more than 12% but if circumstances warrant, there is no minimum fixed by law which they should get. If the schools happen to have no other resources to grant allowances and benefits, either mandated by law or secured by collective bargaining, such allowances and benefits should be charged against the return to investments referred to in the second purpose stated Sec 3(a). The law provides that 60% should go to wage increases and 40% to institutional developments, student assistance, extension services and return on investments (ROI). Under the law, the last item ROI has flexibility sufficient to accommodate other purposes of the law and the needs of the university. ROI is not set aside for any one purpose of the university such as profits or returns on investments. Besides, ROI is a return or profit over and above the operating expenditures of the university, and still, over and above the profits it may have had prior to the tuition increase.

Rada v. NLRC, 205 SCRA 69 (1992)- Sandoval Shipyards, Inc. vs. National Labor Relations Commission, et al. 12 is applicable to the case at bar. Thus:We hold that private respondents were project employees whose work was coterminous with the project or which they were hired. Project employees, as distinguished from regular or non-project employees, are mentioned in section 281 of the Labor Code as those "where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee."Policy Instructions No. 20 of the Secretary of Labor, which was issued to stabilize employer-employee relations in the construction industry, provides:Project employees are those employed in connection with a particular construction project. Non-project (regular) employees are those employed by a construction company without reference to any particular project.Project employees are not entitled to termination pay if they are terminated as a result of the completion of the project or any phase thereof in which they are employed, regardless of the number of projects in which they have been employed by a particular construction company. Moreover, the company is not required to obtain clearance from the Secretary of Labor in connection with such termination.- A non-project employee is different in that the employee is hired for more than one project. A non-project employee, vis--vis a project employee, is best exemplified in the case of Fegurin vs NLRC:Considering the nature of the work of petitioners, that of carpenter, laborer or mason, their respective jobs would actually be continuous and on-going. When a project to which they are individually assigned is completed, they would be assigned to the next project or a phase thereof. In other words, they belonged to a "work pool" from which the company would draw workers for assignment to other projects at its discretion. They are, therefore, actually "non-project employees."From the foregoing, it is clear that petitioner is a project employee considering that he does not belong to a "work pool" from which the company would draw workers for assignment to other projects at its discretion. It is likewise apparent from the facts obtaining herein that petitioner was utilized only for one particular project, the MNEE Stage 2 Project of respondent company. Hence, the termination of herein petitioner is valid by reason of the completion of the project and the expiration of his employment contract.

Social Security System v. Court of Appeals, 348 SCRA 1 (2000)SSSPayrollsTestimony of other laborersRecords of business affairsPower of controlOn SSS: The mandatory coverage under the SSS Law (Republic Act No. 1161, as amended by PD 1202 and PD 1636) is premised on the existence of an employer-employee relationship, and Section 8(d) defines an employee as any person who performs services for an employer in which either or both mental and physical efforts are used and who receives compensation for such services where there is an employer-employee relationship. The essential elements of an employer-employee relationship are: (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the power of control with regard to the means and methods by which the work is to be accomplished, with the power of control being the most determinative factor.On Payroll: Where the veracity of the alleged documents as payrolls are doubtful considering that the laborers named therein never affixed their signatures to show that they actually received the amounts indicated corresponding to their names, the fact that a particular laborers name does not appear in the payrolls is no proof that he did not work in the workplace. On Testimony of other laborers: The testimonies of other laborers who did not waver in their assertion on certain facts of another laborers employment prevail over the incomplete and inconsistent documentary evidence of the employer; where the employer-employee relationship was sufficiently proved by testimonial evidence, the absence of time sheet, time record or payroll becomes inconsequential. No particular form of evidence is required to prove the existence of an employer-employee relationship. Any competent and relevant evidence to prove the relationship may be admitted. Records of business affairs: The employer is duty-bound to keep faithful and complete records of his or her business affairs, not the least of which would be the salaries of the workers. Documents presented in this case have been selective, few and incomplete in substance and content, thus employer failed to convince the court that husband of petitioner was not its employee. Power of Control: The power of control refers merely to the existence of the powerit is not essential for the employer to actually supervise the performance of duties of the employee, as it is sufficient that the former has a right to wield the power. In this case, the employer has an overseer to whom the employer wielded the power to hire or dismiss, to check on the work, be it in progress or quality of the laborers. Shell Oil Co. of the Philippines, Ltd. v. National Labor Union, 81 Phil. 315 (1948)Nightwork has almost invariably been looked upon with disfavor by students of the problem because of the excessive strain involved, especially for women and young persons, the large amount of lost time consequent upon exhaustion of the workers, the additional strain and responsibility upon the executive staff, the tendency of excessively fatigued workers to "keep going" on artificial stimulants, the general curtailment of time for rest, leisure, and cultural improvement, and the fact that night workers, although precluded to an extent from the activities of day life, do attempt to enter into these activities, with resultant impairment of physical well-being. It is not contended, of course, that nightwork could be abolished in the continuous-process industries, but it is possible to put such industries upon a three- or four-shifts basis, and to prohibit nightwork for women and children. (Labor's Progress and Problems, Vol. I, p. 464, by Professors Millis and Montgomery.)Nightwork cannot be regarded as desirable, either from the point of view of the employer or of the wage earner. It is uneconomical unless overhead costs are unusually heavy. Frequently the scale of wages is higher as an inducement to employees to accept employment on the night shift, and the rate of production is generally lower. (Management of Labor Relations, by Watkins & Dodd, pp. 522-524; emphasis ours.)Nightwork. Civilized peoples are beginning to recognize the fact that except in cases of necessity or in periods of great emergency, nightwork is socially undesirable. Under our modern industrial system, however, nightwork has greatly aided the production of commodities, and has offered a significant method of cutting down the ever-increasing overhead costs of industry. This result has led employers to believe that such work is necessary and profitable. Here again one meets a conflict of economic and social interests. Under these circumstances it is necessary to discover whether nightwork has deleterious effects upon the health of laborers and tends to reduce the ultimate supply of efficient labor. If it can proved that nightwork affects adversely both the quality and quantity of productive labor, its discontinuance will undoubtedly be sanctioned by employers. From a social point of view, even a relatively high degree of efficiency in night operations must be forfeited if it is purchased with rapid exhaustion of the health and energy of the workers. From an economic point of view, nightwork may be necessary if the employer is to meet the demand for his product, or if he is to maintain his market in the face of increasing competition or mounting variable production costs.

Wellington Investment Inc. v. Trajano, 245 SCRA 561 (1995)

Issue: WON a monthly-paid employee, receiving a fixed monthly compensation, is entitled to an additional pay aside from his usual holiday pay, whenever a regular holiday falls on a Sunday.

Held: Yes. Every worker should be paid his regular daily wage during regular holidays even if the worker does no work on these holidays (except in retail and service establishments regularly employing less than 10 workers.

This is also applicable in the event of the declaration of any special holiday, or any fortuitous cause precluding work on any particular day or days, the employee is entitled to the salary for the month and the employer has no right to deduct the proportionate amount corresponding to the days when no work was done. The monthly compensation is evidently intended precisely to avoid computations and adjustments resulting from the contingencies just mentioned which are routinely made in the case of workers paid on daily basis.

Wellington used 314 factor = it simply deducted 51 Sundays from the 365 days. The monthly salary thus fixed actually covers payment for 314 days of the year including regular and special holidays, as well as days when no work is done by reason of fortuitous cause, as above specified, or causes not attributable to the employees.

There is no provision of law requiring any employer to make such adjustments in the monthly salary rate set by him to take account of legal holidays falling on Sundays in a given year, or contrary to the legal provisions bearing on the point, otherwise to reckon a year at more than 365 days.

The legal provisions governing monthly compensation are evidently intended precisely to avoid recomputations and alteration in salary on account of the contingencies just mentioned, which, by way are routinely made between employer and employees when the wages are paid on daily basis.

San Miguel Corp. v. Court of Appeals, 375 SCRA 311 (2002)

Facts: Underpayment of SMC of regular Muslim holiday pay to its employees. Should this be applied to non-Muslim employees?

Held:

Yes. Art. 2 of the PD 1083 provides that the provisions of this Coude shall be applicable only to Muslims xxx. However, there should be no distinction between Muslims and non-Muslims as regards payment of benefits for Muslim holiday.

We must remind the respondent-appellant (employer) that wages and other emoluments granted by law to the working man are determined on the basis of the criteria laid down by laws and certainly not on the basis of the workers faith or religen. Art. 3 also declares that nothing herein shall be construed to operate to the prejudice of a non-Muslim. Philippine Fisheries Development Authority v. NLRC, 213 SCRA 621 (1992)

Issue 1: WON an indirect employer is bound by the ruling of NLRC which made the indirect employer liable when the guards are not employees of the petitioner because the contract of services explicitly states that the security guards are not their employees thus, no employer-employee relationship, thus the jurisdiction of the CSC may not be invoked in this case.

Held:

Notwithstanding that the petitioner is a government agency, its liabilities, which are jointly and solidary with that of the contractor are provided in Art. 106, 107 and 109. Its liabilities are under the NLRC scope and in addition, book three title ii on wages provides that the term employer includes any person acting directly or indirectly in the interest of an employer in relation to an employee and shall include the Government and all its branches, subdivisions and instrumentalities, all GOCCs and institutions as well as non-profit private institutions or organizations.

Issue 2: Who should carry the burden of the wage increases?

Held:

It is settled that in job contracting, the petitioner as principal is jointly and severally liable with the contractor for the payment of unpaid wages. In the case at bar, the action was for the payment of unpaid wage differentials under Wage Order No. 6.

In the case of Eagle Security vs. NLRC:

The solidary liability of PTSI and EAGLE, however, does not preclude the right of reimbursement from his co-debtor by the one who paid. It is with respect to this right of reimbursement that petitioners can find support in the aforecited contractual stipulation and Wage Order provision.

The Wage Orders are explicit that the payment of the increases are to be borne by the principal or client. To be borne, however, does not mean that the principal, PTSI in this case, would directly pay the security guards the wage and allowance increases because there is no privity of contract between them. The security guards contractual relationship is with their immediate employer, EAGLE. As an employer, EAGLE is tasked, among others, with the payment of their wages.

Premises considered, the security guards immediate recourse for the payment of the increases is with their direct employer, EAGLE. However, in order for the security agency to comply with the new wage and allowance rates it has to pay the security guards, the Wage Order made specific provision to amend existing contracts for security services by allowing the adjustments of the consideration paid by the principal to the security agency concerned. What the Wage orders require, therefore, is the amendment of the contract as to the consideration to cover the service contractors payment of the increases mandated. In the end, therefore, ultimate liability for the payment of the increasees rests with the principal.

The Wage Orders are statutory and mandatory and can not be waived. The petitioner can not escape liability since the law provides the joint and solidary liability of the principal and the contractor for the protection of the laborers.

But the Court here did not apply the Eagle case because the petitioner is equally guilty by not abiding to the law in the subsequent change of contract even when the WO6 was already implemented.

Therefore, security guards immediate recourse is with direct employer but the latter is not prejudiced as to the claim of of the wages it shall give the guards.

Doctrine: Principal liable for Wage Orders mandating wage increases. But when principal cannot pay, contractor is the immediate recourse and should pay the whole claim with right to reimbursement from principal. But if contractor is at fault, will be liable to of the claim.

Aklan Electric Corp., Inc. v. NLRC, 323 SCRA 259 (2000)

Facts:

Employees working at Lezo but were told to transfer to Kalibo but they did not transfer. Claiming salaries, wages and benefits.

Issue: WON they are entitled to salaries and benefits.

Held: No. The employer gave orders to the employees to transfer office because of the dangers the environment poses to the company, yet the employees disobeyed. Moreover, the transfer of office was approved by NEA Administrator in its exercise of supervision and control over all electric cooperatives. When the business transferred, what was left to the employees to work on? Thus no basis that the employees continued to report for work in Lezo.

The age-old rule governing the relation between labor and capital, or management and employee of a fair days wage for a fair days labor remains as the basic factor in determining employees wages. If there is no work performed by the employee there can be no wage or pay unless, of course, the laborer was able, willing and ready to work but was illegally locked out, suspended or dismissed, or otherwise illegally prevented from working, a situation we find is not present in the instant case. It would neither be fair nor just to allow private respondents to recover something they have not earned and could have not earned because they did not render services at the Kalibo office during the stated period.

Bankard Employers Union v. NLRC, 423 SCRA 148 (2004)

Facts:

Petitioners questioning the new salary increase to new employees which were higher than the regular employees. They claim that there was wage distortion, thus the request for an across-the-board increase.

Held: No wage distortion.

Wage distortion: 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.

Four elements of wage distortion (Prubnkers Assoc):

An existing hierarchy of positions with corresponding salary ratesA significant change in the salary rate of a lower pay class without a concomitant increase in the salary rate of a higher onesThe elimination of the distinction between the two levels andThe existence of the distortion in the same region of the country.

In a problem dealing with wage distortion, the basic assumption is that there exists a grouping or classification of employees that establishes distinctions among them on some relevant or legitimate bases.

The NLRC refutes the petitioners contention that the basis of the levels of classification is the length of service. It stated that, to determine the existence of wage distortion, the historical classification of the employees prior to the wage increase must be established. It must be shown that as between the different classification of employees, there exists a historical gap or difference.

Thus the employees of private respondent have been historically classified into levels i.e. I to V and not on the basis of their length of service. The entry of new employees to the company ipso facto places them under any of the levels. There is no hierarchy of positions between the newly hired and regular employees, thus the first element is wanting.

Apart from the finding of fact of the NLRC and Ca that some of the elements of wage distortion are absent, the petitioner cannot legally obligate Bankard to correct the alleged wage distortion as the increase in the salaries of the newly-hired was not due to a prescribed law or wage order.

Art. 124 should be construed and correlated in relation to minimum wage fixing, the intention of the law being that in the event of ancrease in minimum wage, the distinctions embodies in the wage structure based on skills, length of service or other logical bases of differentiation will be preserved.

If the compulsory mandate under Art. 124 to correct wage distortion is applied to voluntary and unilateral increases by the employer in fixing hiring rates which is inherently a business judgment prerogative, then the hands of the employer would be completely tied even in cases where an increase in wages of a particular group is justified due to a re-evaluation of the high productivity or a particular group, or as in the present case, the need to increase the competitiveness of Bankards hiring rate.

The mention of Metro Transit case was misplaced where it did not confine to wage distortion resulting from government decreed law or wage order because the rectification in that case was not by virtue of Art. 124 of the Labor Code but by the existing company practice that whenever rank-and-file employees were paid a statutorily mandated salary increase, supervisory employees were, as a matter of practice, also paid the same amount plus an added premium.

Wage distortion is a factual and economic condition that may be brought by different causes. The mere factual existence of wage distortion does not, however, ipso facto result to an obligation to rectify it, absent a law or other source of obligation which requires its rectification.

Moreover, in this case, the CBA between the Union and Management gives the Company the right to establish such minimum salaries as it may hereafter find appropriate for specific jobs and to adjust the rates of the employees thereby affected xxx.

Arms Taxi v. NLRC, 219 SCRA 306 (1993)

Facts:

Taxi driver Culla was dismissed by forcing open his quarters and removing his personal belongings found therein and bringing them to his residence.

He is claiming reinstatement with backwages, plus commission of 15% of the gross income of the taxi business which is the issue at bar.

Held: No. He cannot get the 15% commission. If it were true that there had been an agreement regarding the payment of a 15% commission to him, Culla would have not waited almost 6 years to claim it. Considerably delay in asserting ones right is strongly persuasive of the lack of merit of ones claim.

SOLGEN: Salary is different from a commission. The defense that the giving of salary is a partial compliance to pay a commission of percentage. While a salary is a fixed compensation for regular work or for continuous service rendered over a period of time, a commission is a percentage or allowance made to a factor or agent for transacting business for another. Thus, before invoking the exception to the Statute of Frauds, petitioner should have proven that he had received a commission, or part of it, in the past.

Iran v. NLRC, 289 SCRA 433 (1998)

The case where the salesman and truck helpers received commission for cases sold. Then there were irregularities and the respondents were prompted to report cash shortages. After a few days, they stopped reporting for work, thus the conclusion of abandonment. Terminated without notice.

On the other hand, complain for illegal dismissal, deduction, underpayment of wages, premium pay for holiday and rest day, holiday pay, incentive pay, etc.

Issue:

WON commissions in the computation of wages must only be paid after the minimum wage has been paid, thus excluding commissions in the computation for benefits which rely on wage.

Held: No.

The Court has taken judicial notice of the fact that some salesman do not receive any basic salary but depend entirely on commissions and allowances or commissions alone, although an employer-employee relationship exists.

This salary structure is intended for the benefit of the corporation establishing such, on the apparent assumption that thereby its salesmen would be moved to greater enterprise and diligence and close more sales in the expectation of increasing their sales commission. But this does not detract from the character of such commissions as part of the salary or wage paid to each of its salesmen for rendering services to the corporation.

There is no law mandating that commissions be paid only after the minimum wage has been paid to the employee. Verily, the establishment of a minimum wage only sets a floor below which an employees remuneration cannot fall, not that commissions are excluded from wages in determining compliance with the minimum wage law.

In one case it was acknowledged that drivers and conductors who are compensated purely on a commission basis are automatically entitled to the basic minimum pay mandated by law should said commission be less than their basic minimum for eight hours work. It can thus be inferred that where said commissions equal to or even exceed the minimum wage, the employer need not pay, in addition, the basic minimum pay prescribed by law. It follow then that commissions are included in determining compliance with minimum wage requirements. Philippine Association of Service Exporters v. Drilon (1988)J. Sarmiento

Facts:

The petitioner, Philippine Association of Service Exporters, Inc. (PASEI, for short), a firm "engaged principally in the recruitment of Filipino workers, male and female, for overseas placement," 1 challenges the Constitutional validity of Department Order No. 1, Series of 1988, of the Department of Labor and Employment, in the character of "GUIDELINES GOVERNING THE TEMPORARY SUSPENSION OF DEPLOYMENT OF FILIPINO DOMESTIC AND HOUSEHOLD WORKERS," in this petition for certiorari and prohibition.

Issues:

It is an unlawful exercise of police power since this is a power that belongs to the legislative branch not the executive department; and violates the right to travel and impairs the right to contract.Equal Protection clause violation discriminates against women and does not apply to all workers but on to DH.It violates Section 3, of Article XIII, of the Constitution, providing for worker participation "in policy and decision-making processes affecting their rights and benefits as may be provided by law."

Decision: The directive was upheld

Discussion:

The department order is a valid exercise of police power. Police power is one of the three inherent powers of the state, along with taxation and eminent domain that is not written anywhere in the constitution (Im not sure if this addresses the argument that the said power pertains to the legislative branch not the executive branch; that issue was not specifically tackled by the Court)It is defined as the "state authority to enact legislation that may interfere with personal liberty or property in order to promote the general welfare." (Edu v. Ericta) As defined, it consists of (1) an imposition of restraint upon liberty or property, (2) in order to foster the common good. Its scope, ever-expanding to meet the exigencies of the times, even to anticipate the future where it could be done, provides enough room for an efficient and flexible response to conditions and circumstances thus assuring the greatest benefits." (Edu v. Ericta)Nevertheless, its exercise would be invalid if the same is arbitrary, unreasonable and oppressive. As a general rule, official acts enjoy a presumption of validity. In view of petitioners failure to prove that the law is oppressive, the presumption stands. The right to travel may be validly limited in the exercise of police power. The right to travel is subject, among other things, to the requirements of "public safety," "as may be provided by law." (Art III Sec. 6) Department Order No. 1 is a valid implementation of the Labor Code, in particular, its basic policy to "afford protection to labor," pursuant to the respondent Department of Labor's rule-making authority vested in it by the Labor Code. The non-impairment clause of the Constitution, invoked by the petitioner, must yield to the loftier purposes targetted by the Government. Freedom of contract and enterprise, like all other freedoms, is not free from restrictions, more so in this jurisdiction, where laissez faire has never been fully accepted as a controlling economic way of life.

The Equal Protection Clause is not impaired. Equality of the law xxx does not import a perfect identity of rights among men and women. It allows classification, provided that (1) such classifications rest on substantial distinctions; (2) they are germane to the purposes of the law; (3) they are not confined to existing conditions; and (4) they apply equally to all members of the same class. (People v. Cayat)

On 1st element: There is a valid basis for singling out women. As a matter of judicial notice, the Court is well aware of the unhappy plight that has befallen our female labor force abroad, especially domestic servants, amid exploitative working conditions marked by, in not a few cases, physical and personal abuse. This is not to say that men do not suffer the same abuses, however, those are isolated cases. On 2nd element: The classification is germane to the purpose of the directive. Unquestionably, it is the avowed objective of Department Order No. 1 to "enhance the protection for Filipino female overseas workers" This Court has no quarrel that in the midst of the terrible mistreatment Filipina workers have suffered abroad, a ban on deployment will be for their own good and welfare. On 3rd element: The measure will only be in place until the working environment for DHs becomes better. Accordingly the DO provides that it will be lifted once bilateral agreements (between the Phil. and host countries) and other mechanisms for the protection and welfare of Filipino workers are in place. On 4th element: That it does not apply to all Filipina workers is not a ground to impugn the validity of the classification. Most of the victims of abuses are DHs. It is therefore valid to limit the DOs application to them. Had the ban been given universal applicability, then it would have been unreasonable and arbitrary. For obvious reasons, not all of them are similarly circumstanced. The petitioners reliance on the Constitutional guaranty of worker participation "in policy and decision-making processes affecting their rights and benefits" is not well-taken. The right granted by this provision, again, must submit to the demands and necessities of the State's power of regulation.

Philippine Telegraph and Telephone Company v. NLRC (1997)J. Regalado

Facts:

Grace de Guzman was hired as a reliever for the employees of PTTC, when the latter go on leave (maternity and other leaves). She spent more than 6 months with the company during the three times she was hired as reliever. In September 1991, she was asked to join the company on a probationary basis (period of probation: 150 days). De Guzman did not indicate in the forms she filed that she got married in May, 1991. When PTTC supposedly learned about the same later, its branch supervisor in Baguio City, Delia M. Oficial, sent to private respondent a memorandum dated January 15, 1992 requiring her to explain the discrepancy. In that memorandum, she was reminded about the company's policy of not accepting married women for employment. Grace explained that she did not know about the policy but the company fired her anyway, effective January 29. Grace filed a case for illegal dismissal. During the preliminary conference, she volunteered information that she was not able to remit about P2,380 to the company and it was agreed that she sign a promissory note to pay the same.

Labor Arbiter: She was already a regular worker[footnoteRef:1] and entitled to security of tenure. [T]he ground relied upon by petitioner in dismissing private respondent was clearly insufficient, and that it was apparent that she had been discriminated against on account of her having contracted marriage in violation of company rules [1: The Supreme Court agreed on this ruling because Grace has been engaged in activities which are usually necessary or desirable in the usual business or trade of the employer. (Art 280) Note also that she was fired just before the probationary period of her employment ended. She was fired without basis. In fact, the Court said that she was a victim of discrimination. It follows that if she was not unfairly dismissed, she would have finished the probationary period and she would become regular. (My view.)]

On appeal to the National Labor Relations Commission (NLRC), said public respondent upheld the labor arbiter and, in its decision dated April 29, 1994, it ruled that private respondent had indeed been the subject of an unjust and unlawful discrimination by her employer, PT & T. However, the decision of the labor arbiter was modified with the qualification that Grace de Guzman deserved to be suspended for three months in view of the dishonest nature of her acts which should not be condoned. A motion for reconsideration was denied.

Issues: On appeal to the SC, PTTC argues that it did not discriminate on married women. PTTC said that Grace was fired because she concealed information regarding her status, not because of the status itself. She also mishandled company funds, which she herself admitted.

Decision: The Court upheld the NLRCs reasoning, i.e,, Grace was a victim of discrimination. It is recognized that a company can set regulations and rules for its employees in the exercise of its management prerogatives; however, the same should not result in discrimination and violation of the law.[footnoteRef:2] [2: Management prerogative involves prescriptions encompass the matter of hiring, supervision of workers, work assignments, working methods and assignments, as well as regulations on the transfer of employees, lay-off of workers, and the discipline, dismissal, and recall of employees. 19 As put in a case, an employer is free to regulate, according to his discretion and best business judgment, all aspects of employment, "from hiring to firing," except in cases of unlawful discrimination or those which may be provided by law.]

The Supreme Court noted that the Constitution, international conventions, statutes, and the Labor Code have provided for the protection of women in the labor force. Nowhere has that prejudice against womankind been so pervasive as in the field of labor, especially on the matter of equal employment opportunities and standards. In the Philippine setting, women have traditionally been considered as falling within the vulnerable groups or types of workers who must be safeguarded with preventive and remedial social legislation against discriminatory and exploitative practices in hiring, training, benefits, promotion and retention.

Constitution Sec. 14, Art. II[footnoteRef:3] [3: The State recognizes the role of women in nation-building, and shall ensure the fundamental equality before the law of women and men (Sec.14, Art. II).]

Sec. 3, Art. XIII - pointedly requires the State to afford full protection to labor and to promote full employment and equality of employment opportunities for all, including an assurance of entitlement to tenurial security of all workersSec. 14 Art. XIII - mandates that the State shall protect working women through provisions for opportunities that would enable them to reach their full potential.

Corrective labor and social laws on gender inequality have emerged with more frequency in the years since the Labor Code was enacted on May 1, 1974 as Presidential Decree No. 442, largely due to our country's commitment as a signatory to the United Nations Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW). [footnoteRef:4] [4: The Court cited several examples: RA 6727 (1989)- explicitly prohibits discrimination against women with respect to terms and conditions of employment, promotion, and training opportunities. RA 6955 (1990) - which bans the "mail-order-bride" practice for a fee and the export of female labor to countries that cannot guarantee protection to the rights of women workers. RA 7192, The Women in Nation-Building Act (1992) - affords women equal opportunities with men to act and to enter into contracts, and for appointment, admission, training, graduation, and commissioning in all military or similar schools of the Armed Forces of the Philippines and the Philippine National Police; Republic Act No. 7322 15 increasing the maternity benefits granted to women in the private sector. RA 7322 (1995) - increasing the maternity benefits granted to women in the private sector. RA 7877 (1995) which outlaws and punishes sexual harassment in the workplace and in the education and training environment. RA 8042, The Migrant Workers and Overseas Filipino Act of 1995. ]

Labor CodeArticle 130 - involves the right against particular kinds of night work while Article 132 - ensures the right of women to be provided with facilities and standards which the Secretary of Labor may establish to ensure their health and safety. Art. 138 - For purposes of labor and social legislation, a woman working in a nightclub, cocktail lounge, massage clinic, bar or other similar establishments shall be considered as an employee Article 135 - recognizes a woman's right against discrimination with respect to terms and conditions of employment on account simply of sex. Article 136 explicitly prohibits discrimination merely by reason of the marriage of a female employee.

The company policy against married women cannot stand amidst all these laws and regulations. The Court refused to believe the argument that Grace was not fired for being married and that discrimination was not behind her dismissal:It is illogical to say that she was fired for concealing the fact the she was married and not because of that fact. Besides, the memorandum signed by Ms. Oficial contradicts this argument.Neither was Graces failure to remit certain funds the real basis for firing her. As observed by the labor arbiter, the allegation was a mere afterthought. The act was also not deliberate; it was caused by negligence. Moreover, the parties already agreed to allow Grace to pay for the unremitted funds.

The Court ended with a discussion of Art. 136 of the Labor Code, above. Its a substantial discussion and has a relation to the next case (Duncan v. Glaxo).

In Zialcita v. PAL, the court declared the PAL policy of firing flight attendants after they get married saying it is incompatible to Art. 136 of the Labor Code. Article 136 is not intended to apply only to women employed in ordinary occupations, or it should have categorically expressed so. The sweeping intendment of the law, be it on special or ordinary occupations, is reflected in the whole text and supported by Article 135 that speaks of non-discrimination on the employment of women.The judgment of the Court of Appeals in Gualberto, et al. vs. Marinduque Mining & Industrial Corporation 34 considered as void a policy of the same nature. In said case, respondent, in dismissing from the service the complainant, invoked a policy of the firm to consider female employees in the project it was undertaking as separated the moment they get married due to lack of facilities for married women. Branding the policy of the employer as an example of "discriminatory chauvinism" tantamount to denying equal employment opportunities to women simply on account of their sex, the appellate court struck down said employer policy as unlawful in view of its repugnance to the Civil Code, Presidential Decree No. 148 and the Constitution. This is called sex-plus discrimination under US jurisprudence. However, the ruling in Gualberto cited instances when such discrimination of marriage may be considered valid: Upon the other hand, a requirement that a woman employee must remain unmarried could be justified as a "bona fide occupational qualification," or BFOQ, where the particular requirements of the job would justify the same, but not on the ground of a general principle, such as the desirability of spreading work in the workplace. A requirement of that nature would be valid provided it reflects an inherent quality reasonably necessary for satisfactory job performance. Thus, in one case, a no-marriage rule applicable to both male and female flight attendants, was regarded as unlawful since the restriction was not related to the job performance of the flight attendants.(45A Am Jur. 2d Job Discrimination Sec. 506 p486.)

Duncan Association of Detailman PGTWO v. Glaxo Welcome Philippines (2004)J. Regalado

Pedro Tecson ("Tecson") was employed in 1995 by respondent Glaxo Wellcome Philippines, Inc. ("Glaxo") as a medical representative. He was assigned to market Glaxo's products in the Camarines Sur-Camarines Norte sales area. Upon his employment, Tecson signed an employment contract, wherein he agreed, among others, to study and abide by existing company rules; to disclose to management any existing or future relationship by consanguinity or affinity with co-employees or employees of competing drug companies; and if management found that such relationship posed a possible conflict of interest, to resign from the company.Nonetheless, Tecson became romantically involved with Bettsy, an employee of a rival pharmaceutical firm Astra Pharmaceuticals ("Astra"). The two eventually married in September of 1998. The relationship, including the subsequent marriage, was cause for consternation to Glaxo. On January 1999, Tecson's superiors informed him that his marriage to Bettsy had given rise to a conflict of interest. Negotiations ensued, with Tecson adverting to his wife's possible resignation from Astra, and Glaxo making it known that they preferred to retain his services owing to his good performance. Yet no resolution came to pass. In September 1999, Tecson applied for a transfer to Glaxo's milk division, but his application was denied in view of Glaxo's "least-movement-possible" policy. Then in November 1999, Glaxo transferred Tecson to the Butuan City-Surigao City-Agusan del Sur sales area. Tecson asked Glaxo to reconsider its decision, but his request was denied.The matter was then brought to the Glaxo Grievance Committee, and subsequently to a voluntary arbitrator. The National Conciliation and Mediation Board (NCMB) rendered its decision, declaring as valid Glaxo's policy on relationships between its employees and persons employed with competitor companies, and affirming Glaxo's right to transfer Tecson to another sales territory. Issues:Petitioners claim that the company rule applied to him was invalid. It violates the equal protection clause of the Constitution because it creates invalid distinctions among employees on account only of marriage. They claim that the policy restricts the employees right to marry.It was also alleged that Tecson s transfer to Agusan, diminution in pay he suffered, his exclusion from seminars and training sessions for medical representatives, and the prohibition in promoting respondents products which were competing with Astras products all amounted to a constructive dismissal.

Decision: CA upheld.

Discussion:

The company policy on marriage was valid. It does not prohibit marriage per se. employees are free to marry who they want. What it seeks to prevent is conflict of interest, which may be too detrimental in a very competitive business like the pharma industry. (Court cited a similar case in the US state of Georgia, Emory v. Georgia Hospital)

Glaxo has a right to guard its trade secrets, manufacturing formulas, marketing strategies and other confidential programs and information from competitors, especially so that it and Astra are rival companies in the highly competitive pharmaceutical industry.The prohibition against personal or marital relationships with employees of competitor companies upon Glaxos employees is reasonable under the circumstances because relationships of that nature might compromise the interests of the company. In laying down the assailed company policy, Glaxo only aims to protect its interests against the possibility that a competitor company will gain access to its secrets and procedures. (This is especially true in this case since Bettsy was Astras Branch coordinator in Albay and was therefore played an active role in the market war between pharmaceuticals.)That Glaxo possesses the right to protect its economic interests cannot be denied. No less than the Constitution recognizes the right of enterprises to adopt and enforce such a policy to protect its right to reasonable returns on investments and to expansion and growth. Indeed, while our laws endeavor to give life to the constitutional policy on social justice and the protection of labor, it does not mean that every labor dispute will be decided in favor of the workers.

There was no constructive dismissal. Constructive dismissal is defined as a quitting, an involuntary resignation resorted to when continued employment becomes impossible, unreasonable, or unlikely; when there is a demotion in rank or diminution in pay; or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. None of these conditions are present in the instant case.The transfer was in fact made in order to avoid conflict of interest. (The couple would be involved in different sales area and will not be in a position to share marketing information that may be detrimental to Glaxo).Moreover, in Abbott Laboratories (Phils.), Inc. v. National Labor Relations Commission[footnoteRef:5] the Court upheld the right of the drug company to transfer or reassign its employee in accordance with its operational demands and requirements. By the very nature of his employment, a drug salesman or medical representative is expected to travel. He should anticipate reassignment according to the demands of their business. .. [5: It involved a complaint filed by a medical representative against his employer drug company for illegal dismissal for allegedly terminating his employment when he refused to accept his reassignment to a new area.]

Makati Haberdashery vs NLRC, 179 SCRA 449 (89)

Penned by Justice FernanNature: Petition for certiorari to review the decision of the NLRC which affirmed the decision of the Labor Arbiter who jointly heard and decided two cases filed by the Union in behalf of the private respondents

Facts: Private complainants are working for Makati Haberdashery Inc as tailors, seamstress, sewers, basters, and plantsadoras and are paid on a piece-rate basis (except two petitioners who are paid on a monthly basis) and in addition, they are given a daily allowance of P 3.00 provided they report before 9:30 a.m. Work sked: 9:30-6 or 7 p.m., Mondays to Saturdays and even on Sundays and holidays during peak periods.Unions first case was on:underpayment ofbasic wageliving allowancenon-payment ofholiday payservice incentive pay 13th month paybenefits provided for under Wage Orders 1-5While the first case was pending decision, Pelobello left an open package containing a jusi barong tagalong with salesman Rivera. He was caught and confronted about this and he explained that this was ordered by Zapata, also a worker, for his (personal) customer. Zapata allegedly admitted that he copied the design of the company but later denied ownership of the same. They were made to explain why no action should be taken against them for accepting a job order which is prejudicial and in direct competition with the business. However they did not submit and went on AWOL until the period given for them to explain expired hence the dismissal. Illegal dismissal complaint on the second case filed before the LA Diosana. LA declared petitioners guilty of illegal dismissal and ordered to reinstate Pelobello and Zapata and found petitioners violating decrees of COLA, service incentive and 13th month pay. Commission analyst was directed to compute the monetary awards which retroacts to three years prior to filing of case.NLRC affirmed but limited backwages to one year.

Issue: WON employees paid on piece-rate basis are entitled to service incentive pay (relevant to title)

Held: NO, fall under exceptions set forth in the implementing rules

Ratio:As to the service incentive leave pay: as piece-rate workers being paid at a fixed amount for performing work irrespective of time consumed in the performance thereof, they fall under the exceptions stated in Sec 1(d), Rule V, IRR, Book III, Labor Code.

Service Incentive LeaveSECTION 1. Coverage. This rule shall apply to all employees except:(d) Field personnel and other employees whose performance is unsupervised by the employer including those who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective of the time consumed in the performance thereof;

Other issues discussed:

ER-EE relationshipHeld: There is such relationship because in the application of the four-fold test, it was found that petitioners had control over the respondents not only as to the result but also as to the means and method by which the same is to be accomplished. Such control is proven by a memorandum which enumerates procedures and instructions regarding job orders, alterations, and their behavior inside the shop.

Minimum Wage Held: No dispute that entitled to minimum wage but court dismissed case for lack of sufficient evidence to support claim that there was in fact underpayment which was ruled by the LA and which the private resp did not appeal to in the NLRC nor in the SC. Well-settled is the rule that an appellee who has not himself appealed cannot obtain from the appellate court any affirmative relief other than the ones granted in the decision of the court below.

COLAHeld: Entitled. They are regular employees. IRR of Wage No. 1, 2, and 5 provide that all workers in the private sector, regardless of their position, designation of status, and irrespective of the method by which their wages are paid are entitled to such allowance.

13th Month payHeld: Entitled under Sec. 3(e) of the IRR of PD 851 which is an exception to the exception of such provision which states that employers whose workers are paid on piece-rate basis in which are covered by such issuance in so far as such workers are concerned.

Illegal dismissalHeld: Dismissed for justifiable ground based on Article 283 (a) and (c). Inimical to the interest of the employer. Not dismissed just because of union activities.Sentinel Security Agency, Inc. v. NLRC, 295 SCRA 123 1998)

Penned by Justice Panganiban

Nature: Certiorari seeking the reversal of the two petitions to the NLRC

Facts:

Five employees of Sentinel Security Agency filed for illegal dismissal against the Agency and its Client Philamlife Cebu and prayed for payment of salary differential, service incentive pay, and separation pay. The complainants were assigned to Philamlife Cebu but after nearly 20 years for some employees and more than 20 years for some, Philam requested on Dec 16, 1993 that security guards be replaced in the Clients offices in Cebu, Bacolod, CDO, Dipolog and Iligan. Agency issued a Relief and Transfer Order replacing the guards and for them to be reassigned to other clients effective on Jan 16 1994. On Jan 18 and Feb 4 1994, the employees filed an illegal dismissal complaint because of a threat from the personnel manager who told them that they were replaced because they were old. Hence the complaint against the Agency and the Client.Client and Agencys defense: No dismissal because the contract allows them to recall security guards from assigned posts at the will of either party and that the Agency is allowed for a period of not more than six months, to retain the complainants on floating status. Agency should have been given a chance to give new assignments to complainants. Clients defens