Labor Law I Atty. C.A. Azucena

Finals Reviewer

PRELIMINARY TITLE

Chapter I

GENERAL PROVISIONS

Article 1: NAME OF DECREE

Article 2: DATE OF EFFECTIVITY

COMMENTS AND CASES

  1. LABOR LEGISLATION; DEFINITIONS

Broadly divided into labor standards and labor relations

Labor standards law is that which sets out the minimum terms, conditions, and benefits of employment that employers must provide and comply with and to which employees are entitled to as a matter of right.

Labor relations law is that which defines the status, rights and duties, and the institutional mechanisms, that govern the individual and collective interactions of employers, employees or their representatives.

Labor is understood as physical toil, although it does not necessarily involve the application of skill. Skill, by dictionary definition, is the familiar knowledge of any art or science, united with readiness and dexterity in execution or performance or in the application of the science or art to practical purposes.

Work is broader than labor as “work” covers all forms of physical or mental exertion, or both combined, for the attainment of some object other than recreation or amusement per se.

  1. LABOR LAW AND SOCIAL LEGISLATION

Social legislation includes laws that provide particular kinds of protection or benefits to society or segments thereof in furtherance of social justice. In that sense, labor laws are necessarily social legislation.

  1. SOCIAL JUSTICE AS THE AIM

The aim, reason, and justification for labor laws is social justice.

Section 3 of Article XIII says that “the State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all.”

This is because “without the improvement of economic conditions, there can be no real enhancement of the political rights of the people.”

  1. CONSTITUTIONAL RIGHTS AND MADNESS

The basic rights of workers guaranteed by the Constitution are: the rights to organize themselves, to conduct collective bargaining or negotiation with management, to engage in peaceful concerted activities, including to strike in accordance with law, to enjoy security of tenure, to work under humane conditions, to receive a living wage, to participate in policy and decision making processes affecting their rights and benefits as may be provided by law.

4.1.Balancing of Rights; the Constitutional Principle of Shared Responsibility

While labor is entitled to a just share in the fruits of production, the enterprise has an equally important right not only to reasonable returns in investment but also to expansion and growth. The Constitution commands the State to promote the principle of shared responsibility between employers and workers and the preferential use of voluntary modes of settling disputes, including conciliation, and to enforce their mutual compliance therewith to foster industrial peace.

Constitutional outlook suggests a balanced treatment.

  1. POLICE POWER AS THE BASIS

The right of every person to pursue a business, occupation or profession is subject to the paramount right of the government as a part of its police power to impose such restrictions and regulations as the protection of the public may require.

  1. BIRTH OF THE LABOR CODE

Writing began under Blas Ople, Father of the Labor Code

The objective was not merely to consolidate the then existing pieces of social legislation, but also to reorient them to the needs of economic development and justice.

  1. PRINCIPLES UNDERLYING THE CODE

Must be both responsive and responsible to national development

Must substitute rationality for confrontation in times of national emergencies

Must be made expeditious without sacrificing due process

Manpower development and employment must be regarded as a major dimension of labor policy

Availability of a global labor market to qualified Filipinos

Must command adequate resources and acquire capable machinery for effective and sustained implementation

There should be popular participation in national policy making through what is now called tripartism

  1. SOME LABOR LAWS BEFORE THE PASSAGE OF THE CODE

Act 1874 or the Employer’s Liability Act

Act 2549 which prohibited payment of wages in non-cash form

RA 1054 which required emergency medical treatment for employees

CA 444 or the Eight Hour Labor Law

CA 103 which created the Court of Industrial Relations (pre-NLRC)

PD 21 which created the NLRC

RA 875 or the Industrial Peace Act/ Magna Carta of Labor

RA 946 Blue Sunday Law

RA 1052 or the Termination Pay Law

  1. SIGNIFICANCE OF FOREGOING DECISIONS

Where are labor statutes are based upon or patterned after statutes in foreign jurisdiction, the decisions of high courts in those jurisdictions… should receive the careful attention of the SC in the application of our own law.

  1. RELATED LAWS
  2. The Civil Code

Labor relations not merely contractual, but must yield to the common good.

Prohibition against involuntary servitude (Art. 1703)

Also contains provisions regarding wages, househelpers and liabilities of employers.

10.2.The Revised Penal Code

Punishes the use of violence or threats by either employer or employee (Art. 289)

10.3.Special Laws

SSS law, GSIS law, Agrarian Reform Law, 13th month Pay Law, etc.

  1. INTERNATIONAL ASPECT

On June 15, 1948, the Philippines became a member of the International Labor Organization (ILO), which is the UN specialized agency which seeks the promotion of social justice and internationally recognized human and labor rights.

The ILO formulates international labor standards in the form of Conventions and Recommendations setting minimum standards of basic labor rights.

An essential characteristic of ILO is tripartism, that is, it is composed not onl of government representatives but also of employers’ and workers’ organizations.

11.1.International Commitments

By being an ILO member, the country thereby subscribes t the fundamental principles on which the ILO is based. Also, as an ILO member, the Philippines imbibes the obligation of the ILO to further programs that will achieve ILO objectives.

11.2.ILO Core Conventions

The eight core conventions are as follows: Forced Labor Convention (1930); Freedom of Association and Protection of the Right to Organize Convention (1948); Freedom to Organize and Collective Bargaining Convention (1949); equal remuneration Convention (1951); Abolition of Forced Labor Convention (1957); Discrimination (Employment and Occupation) Convention (1958); Minimum Age Convention (1973); and Worst Forms of Child Labor Convention (1999).

11.3.Ratification Generally Needed; Exception

In 1999, the ILO adopted a Declaration on Fundamental Principles and Right at Work concerning an obligation of all ILO members to respect and promote the fundamental rights even if they have not ratified the conventions.

11.4.Ratified ILO Conventions

As of the end of 2000, the Philippines has ratified thirty ILO Conventions, including significantly, the “core” conventions on freedom of association, on abolition of forced labor, on abolition of child labor, and on non-discrimination.

A labor law expert asserts that the Philippines can claim with some pride that it belongs to the upper 25% of the ILO members on the basis of efforts taken to approximate labor standards.

Article 3: DECLARATION OF BASIC POLICY

COMMENTS

  1. LABOR LAWS AND SOCIAL-ECONOMIC GOALS

Labor laws are devices for social equity. The may, depending on their provisions, make the rich richer and the poor poorer.

The value of labor laws is in their contribution to national growth in the context of social justice.

The true task of a student of labor law is to examine how those laws hinder or help the attainment of the country’s socio-economic goals.

  1. INTERDEPENDENCE

It should not be deduced that the basic policy is to favor labor to prejudice capital. The plain reality is that both sectors need each other. They are interdependent- one is inutile without the other.

The better understanding is that the basic policy is to balance or coordinate the rights and interests of both workers and the employers.

Article 4: CONSTRUCTION IN FAOVR OF LABOR

COMMENTS AND CASES

  1. INTERPRETATION AND CONSTRUCTION
  2. Laborer’s Welfare; Liberal Approach

The working man’s welfare should be the primordial and paramount consideration. The policy is to extend the Decree’s applicability to a greater number of employees to enable them to avail of the benefits under the law, in consonance with the State’s avowed policy to give maximum aid and protection to labor.

1.2.Concern for Lowly Worker

The Sc reaffirms its concern for the lowly worker who, often at his employer’s mercy, must look up to the law for protection.

1.3.Reason for According Greater Protection to Employees

In the matter of employment bargaining, there is no doubt that the employer stands on higher footing than the employee.

This is because there is a greater supply than demand for labor. Also, the need for employment comes from vital, even desperate, necessity.

  1. MANAGEMENT RIGHTS

Management also has its own rights which are entitled to respect and enforcement in the interest of simple fair play.

2.1.Right to ROI

The employer has the right to recover his investments and make profits. There is nothing dirty about profit per se – it is profit that creates jobs and improves the workers’ lot.

2.2.Rights to Prescribe Rules

Employers have the right to make reasonable rules and regulations for the government of their employees, and when employees, with knowledge of an established rule, enter the service, the rule becomes a part of the contract of employment.

2.3.Right to Select Employees

An employer has the right to select his employees and to decide when to engage them. He has the right, under the law, to full freedom in employing any person free to accept employment from him, and this, except as restricted by valid statute and valid contract, at a wage and under conditions agreeable to them.

State cannot interfere with the liberty to contract with respect to labor, except in the exercise of police power.

The right of a laborer to sell his labor to such person as he may choose is, in its essence, the same as the right of an employer to purchase labor from any person whom it chooses.

2.4.Right to Transfer or Discharge Employees

The employer has the perfect right to transfer, reduce, or lay off personnel in order to minimize expenses and to insure the stability of the business, and even to close the business, and this right has been consistently upheld, provided the transfer or dismissal is not abused but is done in good faith and is due to causes beyond control.

Article 5: RULES AND REGULATIONS

COMMENTS AND CASES

  1. RULES AND REGULATIONS TO IMPLEMENT THE CODE
  2. When Invalid

If promulgated in excess of its rule making power, the resulting rule or regulation is void.

Article 6: APPLICABILITY

COMMENTS AND CASES

  1. APPLICABILITY TO GOVERNMENT CORPORATIONS

The ruling now is that the Labor Code applies to a corporation incorporated under the Corporation Code.

Government corporations created by special charter from Congress are subject to civil service rules, while those incorporated under the Corporation Code are covered by the Labor code.

1.1.PNOC-EDC, FTI, NHA

  1. Non-Applicability to Government Agencies

The terms governmental “agency” or “instrumentality” are synonymous in the sense that either of them is a means by which a government acts, or by which a certain government act or function is performed. The word “instrumentality” with respect to the state, contemplates an authority to which the state delegates government power for the performance of a state function.

Example: The National Parks Development Committee is an agency of the government, not a government-owned or controlled corporation. Its employees are covered by civil service rules and regulations, since they are civil service employees.

But if function is proprietary in nature, its employees are governed by the Labor Code.

  1. applicability without employer-employee relationship

The Labor Code may apply even if the parties are not employers and employees of each other.

The Labor Code applies with or without employment relationships between the disputants, depending on the kind of issue involved.

For example, when one speaks of employment benefits, then surely, employment relationship is an essential element. But when the issue, for instance, is an indirect employer’s liability, there is no employer-employee relationship and yet the pertinent Labor Code provisions find application.

Chapter II

EMANCIPATION OF TENANTS[1]

Article 7: STATEMENT OF OBJECTIVES

Article 8: TRANFER OF LANDS TO TENTN-WORKERS

Article 9: DETERMINATION OF LAND VALUE

Article 10: CONDITION OF OWNERSHIP

Article 11: IMPMENTING AGENCY

COMMENTS AND CASES

  1. LEGISLATIVE HISTORY

There is an acute imbalance in the distribution of land among our people. Hence, the Constitution of 1987 adopted a whole article containing provisions for the uplift of the common people, thus: “The State shall, by law, undertake an agrarian reform program founded on the right of farmers and regular farmworkers, who are landless, to own directly or collectively the land they till or, in the case of other farmworkers, to receive a just share of the fruits thereof.”

  1. SHARE TENANCY ABOLISHED

RA 3844 abolished and outlawed share tenancy and put in its stead the agricultural leasehold system.

RA 6389, amending RA 3844, declared share tenancy as contrary to law and public policy.

The phasing out of share tenancy was the first step towards the ultimate status of owner-cultivator, a goal sought to be achieved by the government program of agrarian reform.

  1. CONSTITUTIONAL PROVISIONS
  2. COMPENSATION SCHEME

Title to all expropriated properties shall be transferred to the State only upon full payment of compensation of the respective owners.

  1. RETENTION LIMITS

… in no case shall retention by the landowner exceed 5 hectares.

  1. LANDS NOT COVERED
  2. Lands Obtained Through Homestead Patent

The Philippine Constitution respects the superiority of the homesteader’s rights over the rights of the tenants.

Homestead Act has been enacted for the welfare and protection of the poor. The law gives a needy citizen a piece of land where he may build a modest house for himself and his family and plant what is necessary for subsistence and for the satisfaction of life’s other needs.

6.2.Residential Subdivisions

An agricultural leasehold cannot be established on land which has ceased to be devoted to cultivation or farming because of its conversion to a residential subdivision. (Gonzales vs. CA)

6.3.Livestock, Poultry and Swine Raising Lands

There is simply no reason to include livestock and poultry lands in the coverage of agrarian reform.

BOOK ONE

PRE-EMPLOYMENT

Article 12: STATEMENT OF OBJECTIVES

COMMENTS

  1. THE UNEMPLOYMENT PROBLEM

In a list of 18 countries, the Philippines’ unemployment rate is the highest, at 10.2%, meaning more than three million jobless.

The unemployment problem is exacerbated by population growth that appears unchecked.

  1. THE DOLE: ITS RESPONSIBILITY

The Administrative Code mandates the DOLE to assume primary responsibility for:

  1. The promotion of gainful employment opportunities and the optimization of the development and utilization of the country’s manpower resources;
  2. The advancement of workers’ welfare by providing for just and humane working conditions and terms of employment;
  3. The maintenance of industrial peace by promoting harmonious, equitable and employment relations that assure protection for the rights of all concerned parties.

Title I

RECRUITMENT AND PLACEMENT OF WORKERS

Chapter I

GENERAL PROVISIONS

Article 13: DEFINITIONS

COMMENTS

ARTICLE 13 (B) CONSTRUED; WHAT CONSTITUTES RECRUITMENT AND PLACEMENT

The number of persons is not an essential ingredient of the act of recruitment and placement of workers. Any of the acts mentioned in the basic rule in Article 13 (b) will constitute recruitment and placement even if only one prospective worker is involved. (People vs. Panis)

 It must be shown that the accused gave the complainant the distinct impression that she had the power or the ability to send the complainant abroad for work, such that the latter was convinced to part with her money to be so employed. Where such an act or representation is not proven, there is not recruitment activity and conviction for illegal recruitment has no basis. (People vs. Goce)

“By themselves, procuring a passport, airline tickets and foreign visa for another individual, without more, can hardly qualify as recruitment activities.” (Darvin vs. CA)

Article 14: EMPLOYMENT PROMOTION

COMMENTS

EMPLOYMENT PROMOTION

To pursue its responsibility to promote employment opportunities, the DOLE carries out programs for local and overseas employment.

Article 15: BUREAU OF EMPLOYMENT SERVICES

COMMENTS

  1. LOCAL EMPLOYMENT

The Bureau of Employment Services has been replaced by the Bureau of Local Employment (BLE) through EO 797 (May 1, 1982)

1.1.The PESO

Public Employment Service Office

Intended to serve as employment service and information center in its area of operation. It regularly obtains a list of job vacancies from employers, publicizes them, invites and evaluates applicants, and refers them for probable hiring.

Also holds special services for the public such as employment bazaars, etc.

Article 16: PRIVATE RECRUITMENT

COMMENTS

AUTHORIZED ENTITIES

Based on the Rules Implementing the Code, the following entities are authorized to recruit and place workers for local or overseas employment:

  1. public employment offices
  2. Private recruitment entities
  3. Private employment agencies
  4. Shipping or manning agents or representatives
  5. POEA
  6. Construction contractors if authorized to operate by DOLE and the Construction Industry Authority
  7. Members of the diplomatic corps although hirings done by them have to be processed through the POEA
  8. Other persons or entities as may be authorized by the DOLE Secretary.

Article 17: OVERSEAS EMPLOYMENT DEVELOPMENT BOARD

COMMENTS AND CASES

  1. OVERSEAS EMPLOYMENT, A BRIEF HISTORY

Labor migration in the Philippines began in the 1900s when Hawaii experienced severe manpower shortage. The 200 Filipinos that initially went there were followed by many more until they formed about 70% of Hawaii’s plantation labor.

Other countries such as the US, Canada, Australia, Japan and Saudi Arabia eventuall followed suit.

  1. LEGISLATIVE BACKGROUND OF OVERSEAS EMPLOYMENT

Act 2486: first law passed by Philippine Congress relating to overseas employment

PD 442: Labor code, paved the way for stricter government regulation of the overseas employment industry.