Labor Law 1: Atty.

Ronic Treptor penalize unfair labor practice, and provide modes for the
Module 1: General Principles and Concepts settlement of labor disputes such as conciliation, mediation,
grievance machinery, voluntary arbitration and compulsory
arbitration
General Concepts of Labor Law They are covered by:
A. Labor and Labor Laws Book V – Labor Relations
Labor Defined Book VI – Post Employment
1. As an Act Book VII – Transitory Final Provisions
Exertion by human beings of physical or mental efforts, or
both, towards the production of goods and services Social Legislations
2. As a Sector of the Society 1. laws, rules, and regulations that promote welfare of all sectors of
That sector or group in a society, which derives its society
livelihood chiefly from rendition of work or services in 2. laws that provide particular kinds of protection or benefits to the
exchange for compensation under managerial direction society, in furtherance of social justice.
* All labor laws are social legislations but not all social legislations are
Labor law labor laws. Labor laws directly affect employment and directly
- The law governing the rights and duties of the employer and govern the effects of employment. Social legislation is broader
employees with respect to: in scope and will include social security laws and agrarian
1. The terms and conditions of employment; and reform laws.
2. Labor disputes arising from collective bargaining respecting such
terms and conditions. Why the need for the States to regulate Labor?
1. Because an absolute free market capitalism may lead to exploitation
Labor Standards Law of the work force
- the minimum requirements prescribed by existing laws, rules and * The State uses its police power to regulate the use of labor
regulations relating to wages, hours of work, cost of living by the capital.
allowance and other monetary and welfare benefits, including 2. To balance the relationship between labor and capital
occupational, safety and health standards * In the past, workers do not have rights. But due to the labor
(Batong Buhay Gold Mines, Inc., vs. Dela Serna, et. al., G.R. movement that happened during the industrial
No. 86963, August 6, 1999) revolution, workers started forming unions and
They are covered by: demanded minimum standards to be observed by their
Book I – Pre-Employment employers. In the present, it is still true that Capital is
Book II – Human Resources Development Program superior than Labor, and to balance this relationship,
Book III – Conditions of Employment the State comes in to regulate.
Book IV – Health, Safety and Social Welfare
B. Constitutional Provisions Covering Labor law
Labor Relations Law Sec 3, Article XIII: “Protection to Labor Clause”
- the laws, rules and regulations which govern the relationship - the most important labor provision under our constitution is
between employees and their employers, promote the right of 1. Afford full protection to labor
the employees to self-organization and collective bargaining, 2. Promote full employment
3. Ensure equal employment opportunities for all d. Participation in policy and decision-making processes
4. Assure the rights of workers to: affecting their rights and benefits
a. Self-organization Q: What is Full employment?
b. Security of tenure A: that those who want to work at the prevailing rates of pay can find
c. Just and humane conditions of work work without undue difficulty
d. Participate in policy and decision-making process affecting Q: Why does the Constitution require the state to promote full
their right and benefits employment?
5. Regulate the relations between workers and employers A: Full employment provide social and economic stability. If every
person who wants to work can find work at the prevailing rates
…The State shall afford full protection to labor, local and overseas, of pay, then every person can be secured economically that can
organized and unorganized, and promote full employment and lead to the prosperity of the entire country.
equality of employment opportunities for all. It shall guarantee
the rights of all workers to self‐organization, collective Sec. 9, Art. II
bargaining and negotiations, and peaceful concerted activities, The State shall promote full employment, a rising standard of living…
including the right to strike in accordance with law. They shall
be entitled to security of tenure, humane conditions of work, Sec. 10, Art. II
and a living wage. They shall also participate in policy and The State shall promote social justice in all phases of national
decision‐making processes affecting their rights and benefits as development.
may be provided by law. The State shall promote the principle
of shared responsibility between workers and employers and Q: What is Social Justice?
the preferential use of voluntary modes in settling disputes, 1.“neither communism, nor despotism, nor atomism, nor anarchy,” but
including conciliation, and shall enforce their mutual the humanization of laws and the equalization of social and
compliance therewith to foster industrial peace. The State shall economic forces by the State so that justice in its rational and
regulate the relations between workers and employers, objectively secular conception may at least be approximated.
recognizing the right of labor to its just share in the fruits of 2. the promotion of the welfare of all the people; the adoption by the
production and the right of enterprises to reasonable returns to Government of measures calculated to insure economic
investments, and to expansion and growth. – Memorize This! stability of all the competent elements of society, through the
maintenance of a proper economic and social equilibrium in
Rights under Sec. 3, Art. XIII the interrelations of the members of the community,
1. Under Labor Standards constitutionally, through the adoption of measures legally
a. Security of tenure justifiable, or extra-constitutionally, through the exercise of
b. Living wage powers underlying the existence of all governments on the
c. Share in the fruits of production time-honored principles of salus populi est suprema lex.”
d. Humane conditions of work (Calalang v. Williams, G.R. No. 47800, December 2, 1940)
2. Under Labor Relations * The promotion of social justice does not imply oppression of
a. Self-organization capital.
b. Collective bargaining and negotiations
c. Peaceful concerted activities, including the right to strike
Limitation in invoking the principle: existence worthy of human dignity, and supplemented,
1. Social justice does not champion division of property or equality of if necessary, by other means of social protection.
economic status It should not tolerate usurpation of property, d. Everyone has the right to form and to join trade unions for
public or private. the protection of his interests.
(Guido v. Rural Progress Adm, L-2089, October 31, 1949). 2. Article 24: Everyone has the right to rest and leisure, including
2. May only protect the laborers who come to court with clean hands reasonable limitation of working hours and periodic holidays
and their motives blameless with pay.
(Phil. Long Distance Telephone Co. v. NLRC, G.R. No. 80609, 3. Article 4: No one shall be held in slavery or servitude; slavery and
August 23, 1988) ; (Gustilo v. Wyeth Phils., G.R. No. 149629, the slave trade shall be prohibited in all their forms.
October 4, 2004). 4. Article 20
3. Never result in an injustice or oppression of the employer a. Everyone has the right to freedom of peaceful assembly and
(Phil. Geothermal Inc. v. NLRC, G.R. No. 106370) association.
4. If it is used to shield wrongdoings, it cannot be permitted to be the b. No one may be compelled to belong to an association
refuge of scoundrels
(PNCC v. NLRC, G.R. No. 83320, Feb. 9, 1989). Sec. 13, Art. II
* Political Law; Principle of Balancing of Interest (equal protection …Vital role of youth in nation building
clause; constitutional rights colliding) - Rule in favor of labor.
…The State is bound under the Constitution to afford full protection to Sec. 14, Art. II
Labor and when conflicting interests collide and they are to be …Role of women in nation-building…ensure fundamental equality
weighed on the scales of social justice, the law should accord before the law
more sympathy and compassion to the less privileged
workingman Sec. 18, Art. II
(Fuentes v. NLRC, G.R. No. 110017, January 2, 1997). The State affirms labor as a primary social economic force. It shall
…BUT STILL, it cannot be used to shield wrongdoing. protect the rights of workers and promote their welfare.

Sec. 11, Art. II Sec. 20, Art. II

The State values dignity of every human person and guarantees full …Role of private sector, encourage private enterprise
respect for human rights.
Sec. 1, Art. III: equal protection clause
Universal Declaration on Human Rights: …No person shall be deprived of property without due process of law
1. Article 23
a. Everyone has the right to work, to free choice of * Employment, profession, trade or calling is a property right and the
employment, to just and favorable conditions of work wrongful interference therewith is an actionable wrong. The
and to protection against unemployment. right is considered to be property within the protection of a
b. Everyone, without any discrimination, has the right to equal constitutional guaranty of due process of law. Clearly then,
pay for equal work. when one is arbitrarily and unjustly deprived of his job or
c. Everyone who works has the right to just and favorable means of livelihood, the action instituted to contest the legality
remuneration ensuring for himself and his family an of one’s dismissal from employment constitutes, in essence, an
action predicated upon an injury to the rights of the plaintiff, as
 contemplated under Art. 1146 of the New Civil Code, which Sec. 2, Art. XIII
must be brought within four years. The promotion of social justice shall include the commitment to create
(Callanta v. Carnation Philippines, 1986) economic opportunities based on freedom of initiative and self‐
* Money claims involving Employer-Employee relations must be reliance.
brought within three years from accrual of cause of action.
The distinction of prescription is based on the ground for the Sec. 14, Art. XIII:
action. The State shall protect working women by providing safe and healthful
working conditions, taking into account their maternal
Sec. 4, Art. III functions, and such facilities and opportunities that will
No law shall be passed abridging… the right of the people to enhance their welfare and enable them to realize their full
peaceably assemble and petition the government for redress of potential in the service of the nation.
grievances.
C. Civil Code Provisions on Labor
Sec. 8, Art. III Art. 1700.
The right of the people, including those employed in the public and The relations between capital and labor are not merely contractual.
private sectors, to form unions, associations, or societies for They are so impressed with public interest that labor contracts
purposes not contrary to law shall not be abridged. must yield to the common good. Therefore, such contracts are
* Persons employed in the public sector are allowed to join labor subject to the special laws on labor unions, collective
organizations or workers associations. (but no right to strike). bargaining, strikes and lockouts, closed shop, wages, working
* Right to strike of public employees conditions, hours of labor and similar subjects.
…any collective activity undertaken by government employees with
the intent of effecting work stoppage or service disruption in Art. 1701: Principle of Non-oppression
order to realize their demands or force concessions, economic Neither capital nor labor shall act oppressively against the other, or
or otherwise, is a prohibited concerted mass action and impair the interest or convenience of the public.
doubtless actionable administratively. …The protection to labor clause in the Constitution is not designed to
(GSIS v. Kapisanan ng mga Manggagawa sa GSIS, G.R. No. oppress or destroy capital.
170132, December 6, 2006)
* In the absence of statute, public employees do not have the right to Art. 1702
engage in concerted work stoppages for any purpose. In case of doubt, all labor legislation and all labor contracts shall be
(Bangalisan v. Court of Appeals, G.R. No. 124678) construed in favor of the safety and decent living for the
laborer.
Sec. 1, Art. XIII
The Congress shall give highest priority to the enactment of measures Art. 1703
that protect and enhance the right of all the people to human No contract which practically amounts to involuntary servitude, under
dignity, reduce social, economic, and political inequalities, and any guise whatsoever, shall be valid.
remove cultural inequities by equitably diffusing wealth and
political power for the common good. To this end, the State
shall regulate the acquisition, ownership, use, and disposition
of property and its increments.
The Labor Code of the Philippines discretion and judgment, all aspects of employment, including
PRESIDENTIAL DECREE No. 442 hiring, work assignments, working methods, the time, place
and manner of work, work supervision, transfer of employees,
A. Date of Effectivity (Art. 2) lay-off of workers, and discipline, dismissal, and recall of
…This Code shall take effect six (6) months after its promulgation. employees.
The Labor Code took effect on November 1, 1974. (Rural Bank of Cantilan. v. Julve, GR No. 169750)

B. Declaration of Policy (Art. 3) Management prerogatives are subject to limitations provided by:
The State shall afford protection to labor, promote full employment, 1. Law
ensure equal work opportunities regardless of sex, race or creed 2. Contract or Collective Bargaining Agreement
and regulate the relations between workers and employers. The 3. General principles of fair play and justice
State shall assure the rights of workers to self-organization, (Mendoza v. Rural Bank of Lucban, GR No. 155421)
collective bargaining, security of tenure, and just and humane
conditions of work. C. Construction in Favor of Labor (Art. 4)
All doubts in the implementation and interpretation of the provisions
Duty of the State when it comes to Labor of this Code, including its implementing rules and regulations,
The State shall: shall be resolved in favor of labor.
1. Afford full protection to labor; * Also Art. 1702 of the Civil Code
2. Promote full employment;
3. Ensure equal work opportunities regardless of sex, race, or creed; …doubts in the interpretation of the provisions of the Labor Code,
4. Regulate the relations between workers and Employer; and including its implementing rules and regulations, shall be
5. Assure the rights of workers to self-organization, collective resolved in favor of labor.
bargaining, security of tenure, and just and humane conditions
of work Q: What about doubts contained in labor contracts? What is the rule
* However, protection to labor should not equate to oppression of regarding interpretation of doubts contained in an employment
capital contract?
A: In case of doubt, all labor legislation and all labor contracts shall be
Management Rights construed in favor of the safety and decent living for the
The EER has the right to: laborer. (Art. 1702 of the Civil Code)
1. Conduct business
2. Prescribe rules * However, that the principle of construction in favor of labor is only
3. Select and hire Employees applicable if there is doubt. • If the provision is clear, it must be
4. Transfer or discharge Employees applied according to its express terms.
5. Discipline of Employees (Meralco v. NLRC, GR No. 78763, July 12, 1989)
6. Return of investment and expansion of business
D. Enforcing Agency (Art. 5)
Concept of Management Prerogatives The Department of Labor and other government agencies charged with
Under the doctrine of management prerogative, every employer the administration and enforcement of this Code or any of its
has the inherent right to regulate, according to his own parts shall promulgate the necessary implementing rules and
 regulations. Such rules and regulations shall become effective exclusive Officers of the corporation and the Board has no
fifteen (15) days after announcement of their adoption in power to create other Offices without amending first the
newspapers of general circulation. corporate By-laws (falls within exception #4)
…This simply gives the DOLE the duty to enforce the Labor Code. (Matling Industrial Corporation vs. Coros, October 13, 2010)

E. Applicability of the Labor Code (Art. 6) Prudential Bank and Trust Company v. Reyes, 2001
All rights and benefits granted to workers under this Code shall, except …Corporate officer who started as a rank and file employee was
as may otherwise be provided herein, apply alike to all terminated. She filed an action for illegal dismissal before the
workers, whether agricultural or non-agricultural. labor arbiter. The Bank questioned the jurisdiction of the labor
arbiter, considering that the party concerned is a corporate
General Rule officer. The Bank argues that it is the SEC (now RTC) and not
The Labor Code applies to all workers whether agricultural or non- the NLRC who has jurisdiction.
agricultural Held: Labor Arbiter has jurisdiction. It has been stated that the primary
Exceptions: standard of determining regular employment is the reasonable
1. Government employees (covered by the Civil Service Law) connection between the particular activity performed by the
2. Employees of government owned and controlled corporations employee in relation to the usual trade or business of the
created by special or original charter. employer. Additionally, an employee is regular because of the
3. Foreign governments nature of work and the length of service, not because of the
4. International agencies mode or even the reason for hiring them.
* International organizations and intergovernmental bodies are not …as Assistant Vice-President of the Foreign Department of the Bank
covered by the Philippines Labor Laws. The remedy of the she performs tasks integral to the operations of the bank and
aggrieved employee is to file a complaint before the her length of service with the bank totaling 28 years speaks
Department of Foreign Affairs. volumes of her status as a regular employee of the bank. In
5. Corporate officers/ intra-corporate disputes which fall under fine, as a regular employee, she is entitled to security of tenure;
P.D. 902-A and now fall under the jurisdiction of the regular that is, her services may be terminated only for a just or
courts pursuant to the Securities Regulation Code. authorized cause.
* Corporate officers: those enumerated in the Corporation
Code or provided in the by-laws
6. Local water district except where NLRC’s jurisdiction is invoked.
7. As may otherwise be provided by the Labor Code.

Rule on GOCCs
1. If created by special or original charter – Labor Code does not apply
to its employees (Civil Service Law will govern)
2. If created under the Corporation Code – Labor Code applies.
Exception: Rule on Corporate officers: Section 25, Corporation Code
…corporate officers are the President, Secretary, Treasurer and such
other officers as may be provided for in the By-Laws. Whoever
are the corporate officers enumerated in the by- laws are the