POLYTECHNIC UNIVERSITY OF THE PHILIPPINES

A. MABINI, STA. MESA MANILA

INSTRUCTIONAL MATERIALS

FOR

HRM STUDENTS

ON LAW 20073

LABOR LAW AND SOCIAL LEGISLATION

COMPILED BY:

EDGARDO A. ARANDIA
FACULTY MEMBER

COLLEGE OF ACCOUNTANCY AND FINANCE

 TABLE OF CONTENTS

Page

I. Introduction/Overview ………………………. 1
II. Preliminary Statement ………………………. 1
III. Interpretation ………………………. 2
IV. Applicability ………………………. 2
V. The Seven (7) Books of the Labor Code ………………………. 2
VI. Manner and Procedure of Discussion ………………………. 2-3
VII. MODULE I (Book I)
i. Recruitment and Placement of Workers ………………………. 3-5
ii. Regulations of Recruitment and Placement of Workers …………… 5
iii. Miscellaneous Provisions …………… 5
VIII. MODULE II (Book II)
i. National Manpower Development Program ………………………. 6
ii. Training and Employment of Special Workers ………………………. 6
ii.i Apprentices ………………………. 6-7
ii.ii Learners ………………………. 7-8
iii. Handicapped Workers ………………………. 9
IX. ASSESSMENT (MODULES I and II) ………………………. 10-11
X. MODULE III (Book III)
i. Working Conditions and Rest Periods ………………………. 11-13
ii. Working Conditions for Rank and File Employees ………………….. 13-15
iii. Holidays, Service Incentive Leaves, Special Leaves and
Service Charges ……………………… 16-20
iv. Wages ……………………… 20--21
v. Minimum Wage ……………………... 21-22
vi. Payment of Wages ……………………... 23-24
vii. Prohibition regarding Wages ……………………... 24-25
viii. Working Conditions for Special Group of Employees ……………... 25-26
viii.i Employment of Women ……………………… 25-26
XI. ASSESSMENT ……………………… 26
XII. MODULE IV (Book IV)
Health, Safety and Social Welfare Benefits ……………………… 26
i. Medical, Dental and Occupational Safety ……………………… 26-27
i.i Occupational Health Safety ……………………… 27
ii. Employees’ Compensation and State Insurance Fund ……………….. 28
i. Coverage and Liability ……………………… 28- 29
XIII. ASSESSMENT ……………………… 29
XIV. MODULE V (Book V)
Labor Relations ……………………… 29
XV. MODULE VI (Book VI)
Post-Employment …………………….... 30-35
i. Constitutional balance on Protection to Labor ……………………… 30
ii. Coverage ……………………… 30
iii. Security of Tenure ……………………… 30- 31
iv. Regular and Casual Employees ……………………… 30-31
v. Project BaseEmployee ……………………... 31- 32
vi. Regular Seasonal Employee ……………………… 32
vii. Probationary Employment ……………………… 32
viii. Fixed Period Employment ……………………… 32
ix. Termination by Employer, Just Causes ……………………… 32-33
x. Preventive Suspension ……………………… 33
xi. Authorized Causes ……………………… 33-34
xii. Termination by Employee ……………………… 34- 35
xiii. Retirement from Service ……………………… 35
xiii.i Retirement Benefit ……………………… 35-36
XVI. ASSESSMENT ……………………... 36
XVII. MODULE VII (Book VII and Social Legislation)
i. Penal Provisions and Liabilities …………………….. 36-37
ii. Prescription of Offenses and Claims ……………………… 37
iii. Jurisdiction in Labor Cases ……………………… 37-38
iv. Social Legislation ………………………. 39
iv.i. Social Security Benefits under SSS Law ……………………… 39-41
iv.ii Pag-ibig Benefits under R.A. 9679 ……………………… 41-42
v. Philhealth Benefits under R.A. 7875, as amended by R.A. 9241 ………. 42-43
XVIII. ASSESSMENT ……………………… 43
 INTRODUCTION/OVERVIEW

This instructional materials consist of seven (7) Modules covering the Labor Code of the
Philippines and Social Legislations. Each Module speaks of topics discussed therein as guide
for students to read and understand augmented by On Line Sessions where they are free to ask
questions or seek clarifications the answers on which are for appreciation by every body or the
entire class.

The Labor Code of the Philippines consists of seven (7) books with seven different
topics on labor. Social Legistlations on the other hand are special laws enacted to help the
people especially the less privilege to lift their their socio economic standing and ease their
burden from economic hardship. The most common social legislations are the Social Security
Law, Employees Economic Compensation, Philhealth, Pag-ibig, and Agrarian Reform Law, as
amended by the Comprhensive Agrarian Reform Law.

As one would see, this instructional materials deals only on the most basic provisions of
the Labor Code and Social Legislations having usual and common applications needed to know
by the students as part of their curricullum.

PRELIMINARY STATEMENT

The Labor Code of the Philippines is the law governing employment and labor relations
in the Philippines. It was promulgated during the Martial Law era through presidential Decree
No. 442 and was signed into law on May 01, 1974.

Constitutional Provision as basis of the Labor Code of the Philippines

The Labor of the Philippines has its basis under Art. II, Sec. 18 of the Philippine
Constitution on State Policies:

“Sec. 18. The State affirms labor as a primary social economic force. It
shall protect the rights of workers and promote their welfare.”

Thus, Art. 3 of the Labor Code of the Philippines reads:

“ Art. 3. DECLARATION OF BASIC POLICY. The State shall afford

protection to labor, promote full employment, ensure equal work opportunities
regardless of sex, race or creed, and regulate the reltions between workers
andemployers. The State shall ensure the rights of workers to self-organization,
collective bargaining, security of tenure, and just and humane conditions of
work”

1
 Interpretation

All doubts in the implementation and interpretation of the provisions of the Labr Code,
including its implementing rules and regulations, shall be resolved in favor of labor.1

Applicability

All rights and benefits granted to workers under the Labor Code apply alike to all
workers, whether agricultural, or non-agricultural except as otherwise provided in the Code.2

THE SEVEN (7) BOOKS OF THE LABOR CODE

The Labor Code of the Philippines is composed of seven (7) Books. Book I, is Pre-
Employment covering Recruitment and Placement of Workers inclusive of the Migrant Workers
and Overseas Filipinos Act of 1995 (R.A. 8042). Book II, Human Recouces Development.
Book III, Conditions of Employment. Book IV, Health, Safety and Social Welfare Benefits.
Book V, Labor Relations. Book VI. Post-Employment, and Book VII, Transitory and Final
Provisions.

MANNER AND PROCEDURE OF DISCUSSION

Weeks: 1-4 for Modules I and II; 5-8 for Modules III and IV; 9 for Module V; 10-15 for Module
VI; 16-17 for Module VII.

Day 1 of week 1: Orientation on Course Syllabus and Classroom management, the Text Book
needed an other reading materials on Labor Code of the Philippines and Social Legislations.
Introduction to the study of the subject for real life application. Open session queries are
encourage the answers on which are for appreciation by all members of the class. Methodology
is Virtual/On Line Discussion through the use of eithr Microsoft Teams or Zoom or any other
platforms. By way of assessment, students are required to answer the Assessments at the end of
each module. Subsequently, direct discussions of the topic and sub-topics as outlined on the
Modules until termination of the entire course.

COURSE MATERIALS/TOPICS: Books I to VII of the Labor Code of the Philippines with
the Main Topics and Sub-Topics as herein discussed and presented.

1
Art. 4, The Labor Code of the Philippines;
2
Art. 6, The Labor Code of the Philippnes;

2
COURSE OUTCOMES/OBJECTIVE: For students to learn the basic provisions of the Labor
Code composed of Books I to VII and its Implemeting Rules and Regulations altogether with the
Social Legislations as herein presented and discussed which are objective and executory in
character. They are not theoretical to be subject of debates.

LEARNING OUTCOMES: At the end of each and every Modules, students are expected to
learn the basic provisions of law on Labor for actual application.

METHODOLOGY: Reiteration and Discussion of the Topic and Sub-Topics as presented and
discussed through On-Line Discussion. Open Session queries are encourage for appreciation by
all.

GRADING SYSTEM. 50% Class Standing consisting of actual participation through On-Line
Discussion, Case analysis, and Sumative Tests. 50 % Mid-Term adn Final Examination.

ASSESSMENT: Integrated at the end of the Modules as herein presented are Questions for
students to answer in assessment of the knowledge they acquired under this Instructional
Materials and in Open Session through On Line Discussion.

REFERENCES: The Labor Code of the Philippines, its Implementing Rules and Regulations,
any Text Books on Labor Law, the SSS, Pag-ibig, and Philhealth.

MODULE I (BOOK I )

I. Recruitment and Placement of Workers

In substance, Book I provides the provisions on recruitment and placement of workers.

For domestic employment, the Bureau of Local Employment (BLE) is the agency of the
government in charge of and shall be primarily responsible for developing and monitoring a
compehensive employment program except for apprenticeship program which is now under the
Technical Education and Skills Development Authority (TESDA) created under R.A. No. 7796,
otherwise known as the TESDA Act of 1994.

Promotion of employment opportunities is the principal task of the Bureau of Local

Employment created under E.O. No. 797 which also created the Philippine Overseas
Employment Administration (POEA) for overseas employment.

The general rule under Book I is only public employment offices shall enagage in the
recruitment and placement of workers. Private recruitement is allowed when licensed to do so by
the BLE for domestic employment and by the POEA for overseas employment.

3
 Under Book I, pre-mature termination of Employment Contract is not allowed except on
lawful or valid ground. In case of pre-mature termination, the employer shall be ordered to pay
the workers their salaries corresponding to the unexpired portion of their empployment contract.

Under R.A. No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos
Act of 1995, a worker dismissed from overseas employment without just, valid, or authorized
cause as defined by law or contract, is entitled to the full reimbursement of his placement fee
with interest at 12% (now 6%) per annum plus his salary for the unexpired portion of his
employment contract or for three (3) months for every year of the unexpired term, whichever is
lesser when the emloyment contract is at least one (1) year. If the employment contract is
shorter, the salary to be paid should be that for the unexpired portion.

Seafarers or Seamen are Contractual Employees under R.A. 8042.

Direct Hiring of oveseas employment is not allowed except through the POEA. However,
Direct Hiring by members of the Diplomatic Corps, International Organizations, and such other
Emloyers as may be allowed by the DOLE is exempted from the provision against Direct
Hiring.3

The POEA provides the minimum provisions of employment contracts for Seafarers and
land based OFW. Parties to an overseas employment contract may enter into terms and
conditions beyond the minimum standards provided by the POEA.

It is mandatory for all Filipino Workers abroad to remit a portion of their foreign
exchange earnings to their families, dependents, and/or beneficiaries in the country.4

The Overseas Workers Welfare Administration (OWWA) was created by PD 1694 to

provide social and welfare services, including insuracne coverage , legal assistance, placement
asisstance and remittacne services to Filipinos Overseas Workers from the Welfare Fund coming
from contributions from the workers themselves and the charges and fees imposed by the POEA
and the BLE.

Repatriation of workers , including his or her remains and personal effects belong to the
principal or the agency that recruited or deployed the worker altogether with the Air Fare and
cost of repatriation. When the principal or the agency refuses, the OWWA will provide it with

3
Art. 18, Book I, Labor Code of the Philippines;
4
Art. 22, Book I, Labor Code of the Philippines;

4
right of recourse against either the principal or the agency. Upon notice to OWWA, the POEA
may impose sanctions on the principal or the agency.

I. Regulations on Recruitment and Placement Activities

Private Employment Agencies for land based overseas filipino workers or Manning
Agency for Filipino Seafarers is allowed to recruit provided they are licensed to do so by the
POEA. For domestic employment, by the BLE.

Only Filipino citizen or in case of corporations or partnerships, or entities, at least 75% of

the authorized and voting capaital stock of which is owned by Filipino citizens shal be permitted
in the recruitment and placement of workers, locally or abroad. Travel agencies and airline
companies are prohibited from engaging in the business of recruitment and placement of workers
for overseas employment whether for profit or not.5

The license or authority issued to the licensee to recruit and place/deploy workers locally
or abroad is non transferable except when approved by the Department of Labor.6

II. Miscellaneous Provisions

Regulatory and Visitorial Power to enforce the provisions of Book I and its Implementing
Rules and Regulations belongs to the Secretary of Labor.

Illegal Recruitment is any recruiting acivities by a non-holder of a license or authority to

recruit. When committed by a “Syndicate or in Large Scale”, it is an offense of ECONOMIC
SABOTAGE and shall be punishable by life imprisonment and P 100,000.00 fine. It is a
Syndicate when committed by three (3) or more persons conspiring with each others in carrying
an illegal recruitment. It is Large Scale when the victims are 3 or more pesons individually or
as a group. The criminal complaint shall be filed in the place where committed, or where the
victim actually resides at the time of the commision ofthe offense.7 The offense of Illegal
Recruitmet prescribes in five (5) years from the time of its commission. Twenty (20) years when
it is commited by a syndicate or when the victims are 3 or more persons or as a group or in large
scale.

5
Art. 26, Book I, Labor Code;
6
Art. 29, Book I, Labor Code;
7
Sec. 9, R.A. 8042;

5
 MODULE II (BOOK II)
I. NATIONAL MANPOWER DEVELOPMENT PROGRAM

Implementation of the National Manpower Development Program is now uner the

Technical Education and Skills Development Authority (TESDA) which was created under R.A.
No. 7796, otherwise knowas thew TESDA Act of 1994 composed of the TESDA Board and the
TESDA Secretariat. The Board has 19 members who are repesentatives from the government,
the private sector, and Vocational Schools. The government repesentatives are: the 3 Cabinet
Secretaries of the: DOLE, DECS, and DTI.

Its main and primordial objective is the development of Technical Education and Skills.
For the purpose, it grants scholarship grants that are responsive to Technical Educations and
Skills Development needs of the different regions in the country, among others.

II. TRAINING AND EMPLOYMENT OF SPECIAL WORKERS

1. Apprentices.

1.1 Apprenticeship is practical training on the job supplemented by related theoretical

instruction.
1.2 Apprentice is a worker covered by a written apprenticeship agreement with an
individual employer or any of the entities, Trade and Industry Associations or
Group recognized by the TESDA.
1.3 Apprenticeship Occupation is any trade, form of employment or occupation which
requires more than three (3) months of practical training on the job supplemented
by theoretical instruction.
1.4 Apprenticeship agreement is an employment contract whereby the employer binds
himself to train the apprentice and the latter in turn accepts the terms of his
training8.

2. Qualifications of Apprentice.

2.1 At leaset 14 years old;

2.2 Possesses vocational aptitude and capacity for appropriate test; and
2.3 Posesses the ability to comprehend and follow oral and written instructions9;

3. Employment of Apprentices.

8
Art. 58, Book 2, Labor Code;
9
Art. 59, Idem;

6
 Only employers in the highly Technical Industries may employ apprentices and in
apprenticeable occupations approved by the Secretary of Labor10.

4. Apprenticeship Agreement.

Apprenticeship Agreements, including wage rate of apprentices, shall conform with

the rules issued by the Secretary of Labor and Employment. It shall not exceed six (6) months.
The salary rate is not less than 75% of the minimum wage11 and to be signed by the employer or
his agent, or by any authorized representative of any of the recognized organizations,
associaitons or groups, and by the apprentice.12

5. Apprenticeship Program. Is a voluntary undertaking by employers13

6. Training costs. One Half (½ ) of the total training expenses shall be deducted to
the income tax of the employers14;

7. Apprenticeship without compensation. Training on the Job required by the school

or Training Program Curriculum as a requisite for graduation or Board Examination is without
compensation.15

III. LEARNERS

1. Learners are pesons hired as trainees in Semi-Skilled and other Industrial

Occupations which are non-apprenticeable and which may be learned through practical training
on the job in a relatively short period of time which shall not exceed three (3) months.16

2. Learners may be employed when no experienced workers are available. Their

employment is necessary to prevent curtailment of employment opportunities, an employment
does not create unfair competition in terms of labor costs or impair or lower working standards.17

3. Learnership Agreement. It is an agreement between employer and a learner

which shall include the following:

10
Art. 60, Idem;
11
Art. 61, Idem;
12
Art. 62, Idem;
13
Art. 70, Idem;
14
Art.71, Idem;
15
Art. 72, Idem;
16
Art. 73, Idem;
17
Art. 74, Idem;

7
 3.1 The names and addresses of the learners;
3.2 The duration of the learnership period which shall not exceed three (3) months;
3.3 The wage or salary of the learners which shall not be less than 75% of the
minimun wage at the time of hire;
3.4 A committment to employ the learners if they so desire as regular employees
upon completion of the learnership. All learners who have been allowed or suffered to work
during the first two (2) months shall be deemed regular employees if training is terminated by the
employer before the end of the three (3) month period through no fault of the learner.18

4. Learners in Piecework. Learners in piece or incentive rate jobs during the

training period shall be paid in full for the work done.19

5. Penalty. Any violation of the provisions on Learners or its implementing rules

and regulations shall be subject to the general Penalty Clause under the Labor Code.20

6. Distinctions between Apprentice and Learner.

6.1 In terms of training focus, Apprentices train in skilled or highly skilled job or in a
job found only in highly technical industry and requires more than thre (3) months training.
Learners, on the other hand, train in semi-skilled job or industrial occupations requiring at least
three (3) months of training;

6.2 Employers are committed to hire the learners after the training. No such
committment for Apprentices. Hiring of apprenties is allowed only in highly technical industries
and only in apprenticable occupations approved by DOLE21;

6.3 Both receives 75% of the applicable minimum wage;

6.4 Both are similar in that they are training for job requiring skills to be acquired
through an actual work experience;

18
Art. 75, Idem;
19
Art. 76, Idem;
20
Art. 77, Idem;
21
Art. 60, Idem;

8
 IV. HANDICAPPED WORKERS

Handicapped workers are those whose earning capacity is impaired by age or physical or
mental deficiency or injury22. They are employable when their employment is necessary to
prevent curtailment of employment oppostunities and when it does not create unfair competition
in labor costs or impair or lower working standards.23 When employed, they are subject to the
following employment agreement24:

a. The names and addresses of the handicapped workers;

b. Not less than 75% of the applicable minimum wage salary;
c. Duration of employment period;
d. Work to be performed by handicapped workers;

Handicapped workers may be hired as Apprentices or Learners when their handicapped

will not effectively impede the performance of job operations in a particular occupation for
which they were hired.25

Under R.A. No. 7277 approved on March 24, 1992, otherwise known as the Magna
Carta for Disabled Persons, persons suffering from disability shall have equal opportunities
with able bodied individual and prohibits discrimination against them. Fundamentally, no
disabled persons shall be denied access to opportunities for suitable employment. A qualified
disabled employee shall be subject to same terms and conditions of employment and the same
compensation, privileges, benefits, fringe benefits, incentives or allowances as that of qualified
able bodied person.

The law also provides incentives for employment of disabled persons. A handicapped
worker can acquire the status of a regular employee.

TheMagna Carta for Disabled Persons in effect repealed the Labor Code Provisions
on Handicapped Workers.

22
Art. 78, Idem;

23
Art. 79, Idem;
24
Art.80, Idem;
25
Art. 81, Idem;

9
 ASSESSMENT FOR MODULES I and II

1. The government agency in charge of recruitment and placemnt of wokers are:

a) The Bureau of Local Employment;

b) The POEA;
c) The TESDA;
d) All of the above;
e) None of the above;

2. Who can engage in the recruitment and deployment of workers?

a) Public Employment Agencies;

b) Private Employment Agencies when licensed to do so;
c) Travel Agencies;
d) All of the above;

3. Pre-termination of employment contract of OFW entitles him to:

a) ___________________; b) ___________________; c) __________________;

4. The government agency in charge of the welfare of Filipino OFW is:

a) TESDA;
b) POEA;
c) OWWA;
d) All of the above;

5. Illegal recruitment is an offense of economic sabotage when:

a) Committed by 3 more person conspiring together to engage or engaging in illegal

recruitment activities;
b) The victimes are 3 more individullay or as a group;
c) Is punishable by life imprisonment and P100,000.00 fine;
d) All of the above;

6. The main and primordial function of TESDA are:

a) Development of Technical Education;

b) Development of Skills;

10
 c) For the purpose, the grant of scholarship for development of Technical Education
and Skills;
d) All of the above;
e) None of the above;

7. In connection with the National Manpower Deveopment Program of the

government, who are the special workers covered thereby?

a) _________________; b) ________________; c) _______________; and

d) _________________;

8. The Special Law governing disabled individual is:

__________________________;

9. What are the rights of disabled individual under The Magna Carta for Disabled
Persons?

MODULE III (BOOK III)

CONDITIONS OF EMPLOYMENT

I. WORKING CONDITIONS AND REST PERIODS

1. Coverage. The conditions of employment particularly on working conditions or

standards of employment apply to all “Rank and File Employees” in all establishments and
undertakings whether for profit or not. Except to: a) Goverment employees; b) Managerial
employees; c) Field Personnel; d) Members of the family of the employers who are dependent
upon him for support; e) Domestic Helpers; f) Persons in the personal service of another; and g)
Workers who are paid by results as determined by the Secretary of Labor in appropriate
regulations.26

In other words, the excepted employees mentioned above are not subject to working
conditions or standards of empoyment like: normal hours of work, hours worked, meal
periods, night shift differential pay, overtime work, emergency overtime work, rest day,
holiday pay, service incentive leave pay, and minimum wage, premium pay and other
benefits.

26
Art. 82, Book III, Labor Code;

11
 1.1 Managerial emloyees are those whose primary duty consists of the management
of the establishment in which they are employed, or a department or subdivisoin thereof, and to
other officers or members of the Managerial Staff like Supervisors;

1.2 Field personnel are those non-agricultural employees who regularly perform their
dutites away from the principal place of business or branch office of the meployer and whose
actual hours of work in the field cannot be determined with reasoable certainty.

2. For Working Conditions and Standards of Employment to apply, it is neesary that

there must exists employer-employee relationship betwen the parties. The “Four Fold Test”
gives us the elements on the existence of one, namely:

2.1 The selection and engagement of the employee;

2.2 The payment of wages;
2.3 The power of dismissal;
2.4 Employer’s power to control employee with respect to the means and methods by
which the work is to be accomplished, or known as the Control Test;

The “Control Test” is the most important of all the elements. Without the power of
control, there is no employer-employee relationship that exists. For Control Test to determine
existence of employer-employee relatonship, there must be means and methods imposed by the
employer for strict performance by the employee. Simply stated, the employee is restricted from
performing other means or methods on how to perfrom the assigned task other than the means or
methods imposed by the employer.

Letter of Appointment, Employment Contract, Payrolls, Organization Chart, SSS

Regstration and Contribution, List of personell as well as testimony of co-employees may serve
as evidence of employee status.

The exisence of employer-employee relationship cannot simply be avoided by

repudiating it in the employment contract. By simply saying that an employee is an
independednt contractor when the terms of the agrement show otherwise will not prevail. The
kind of compensaion agreement is not the decisive factor to determine whether a worker is an
employee or not. Huge or little compensation is not the decisive factor. The decisive factor is
the power of control of the employer.

A Contractor is not an employee. He is a businessman with capital of his own who

operates independently from his client or his principal to accomplish the job, work or service.
When he hires to do the work, project or servicee to do it, they are his own employees and not of
the employer as principal.

12
 A contractor is not necesarily a corporation or partneship. He can be an individual
because of his talent or skill as that of a TV Host or Radio Broadcaster. He is free to render the
work or service on his own accordining to his own style and may be paid such huge amount of
Talent Fee as that of TV Host Jay Sonza of GMA.

Commission Agents are also not employees unless they are required to report for work at
any time. On the contrary, if they are required to report on a regular basis upon instruction by
the employer and are receiving salaries in addition to commission, they are employees. The
commission is only an incentive being given by way reward in exchange for a job well done
usually associated with gain or profit.

Working conditions are upon the decision of the employer. It is commonly called
“Management Prerogative” relative to terms and conditions of employment. It includes hiring,
work asignments, working methods, time, place and manner of work, among others.
Management prerogative is not absolute. It cannot be abused such that when it is detrimental to
the interest of or when availed to defeat or circumvent the rights of employees, it will not be
upheld. When done in good faith for advancement of employee’s interest, Management
Preroragative shall be upheld.

II. WORKING CONDITIONS FOR RANK AND FILE EMPLOYEES

1. Normal Hours of Work.27

1.1 At least 8 hours a day. Health personnel in Cities or Municipalities having a

population of at least 1 million or in hospitals and clinics with at least 100 bed capacity, at least
eight (8) hours a day for five (5) days a week exclusive of time for meal. But in the exigency of
the service, they may be required to work for six (6) dys or 48 hours a week subject to payment
of 30% of their regular daily pay for work performed on the sixth (6th) day.

1.2 Health personnel are: a) resident physicians; b) nurses; c) nutritionists; d)

dieticians; e) phamacists; f) Social Workers; g) Laboratory Technicians; h) Paramedical
Technicians; i) Psychologits; j) Mmidwives, k) Attendants and all other Hospital and Clinic
Personnel such as hospital or clinic janitors who maintain cleanliness and the sanitary condition
of the hospital or clinic, and ambulance driver.

1.3 The forty (40) hour work week by resident physicians is not applicable when he
works when he is under a training agreement with the hospital and the traning agreement is duly
accredited or approved by the appropriate government agency concerned for there is no

27
Art. 83, Book III, Labor Code;

13
employer-employee relationship between the resident physician and the hospital on acount of
the approved or accredited training program.

1.4 R.A. No. 5901 removes the seven (7) days pay for five (5) days work in a week.

2. Hours worked28. It includes:

2.1 All the time during which an emplotyee is required to be on duty; or

2.2 To be on a prescribed work place; and
2.3 All the time during which the employee is suffered or permitted to work;

In Pars. 2.1 and 2.2., it is not necesary that an employee is actually performing his duty
or is suffered or permitted to work. For as long as he is on a prescribed work place or station
upon instruction by the employer even without actually performing the job/work, it is hours
worked and has to be compensated accordingly. Like contruction workers waiting for
construction materials needed for work at the job site. Driver waiting for passengers to be
transported to work site. Teacher or Instructor waiting in the classroom for his students, or
simply sitting while awaiting insructions from the employer, among others.

In Par. 2.3, it includes all the time that employees are actually working or suffered or
permitted to work are compensable.

3. Meal Periods29. Employees are entitled to one (1) hour time off for their regular
meal.

4. Night Shift Differential30. Additional pay equivalent to 10% of his hourly pay
for work performed beween 10:00 p.m. to 6:00 a.m.

5. Overtime work31. Work performed beyond eight (8) hours a day upon instruction
by the employer. Employee is entitled to additonal pay of at least 25% of his hourly rate. When
peformed during his scheduled rest day or speacial working holiday, plus 30% of his hourly rate.

6. Overtime is not offset by undertime32. Earnings from overtime service cannot be

offsetted by undertime. The reason being, earnings with overime service is greater than the the

28
Art. 86, Idem;

29
Art. 85, Idem;
30
Art.86, Idem;
31
Art. 87, Idem;
32
Art.88, Idem;

14
usual daily pay without overtime. To deduct undertime to overtime will reduce the pay of the
employee/worker.

7. Compressed Work Week. It is a valid waiver of overtime pay on condition that it

is approved by the majority of the workers and should not diminish or reduce employees’
monthly or daily pay or established employment benefit, and should not exceed twelve (12)
hours. If exceeds, it is considered overtime work subject to payment of overtime pay. It
applies when the regular workdays a week is 48 hours which shall be compressed to only forty
(40) hours or five (5) days a week. The employees can save on transportation cost, meal
expense and can devote their time to their families and other endeavor for the sixth (6th) day
that was compressed to five (5) day work.

8. Rest day33. One (1) day rest for every sixth (6th) consecutive regular work
days. Employer shall determine the rest day of an employee subject to CBA and such rules and
regulations the Secretary of Labor may provide. Employee’s preference of rest day shall be
respected on religious ground as communicated by the employee.

9. Employees can be required to work on rest day on grounds34 like emergencies,

urgent work to be performed on machineries, equipment or installation to avoid serious los to
employer arisig therefrom, and in case of abnormal presure of work due to special circumstances
and the employer cannot resort to other measures, to prevent loss or damage of perishable goods,
and when the nature of work requires continuous operations and stoppage may result in
irreparable injury or loss to employer (as in construction when concrete pouring has to be
completed).

9.1 Failure to work when required and when lawul ground exists may subject the
employee concerned to disciplinary action or even dismissal from the service when repeatedly
disobeyed.

9.2 Plus 30% of his regular daily wage for work performed on rest day;

9.3 When rest day falls on a special holiday, plus 50% of his daily wage;

9.4 When no regular rest day or no regular workdays can be scheduled, , the rest day
is work performed during Sunday.
9.5 When a higher premium pay is expressly stipulated, the rate under the CBA shall
be paid by the employer.

33
Art. 91. Idem;
34
Art. 92, Idem;

15
 III. HOLIDAYS, SERVICE INCENTIVE LEAVES, SPECIAL LEAVES AND
SERVICE CHARGES

1. Holiday Pay35. Employees are entitled to payment of his regular daily wage
during regular holidays when he did not report for work provided he was present or was on
leave of absence with pay on the day immediately preceding the holiday. The benefit applies to
all employees except: 1) government employees; 2) employees of retail and service
establishments regularly employing less than ten (10) employees; 3) Kasambahay and
persons in the personal service of another; 4) Managerial employees and officers or
members of the managerial staff; 5) field personnel and other employees whose time and
performance is unsupervised by the employer, including those engaged on task or contract
basis, purely commission basis, or those paid a fixed amount for performing work
irrespective of time consummed in the performance thereof.

There are twelve (12) regular holidays in a year under E.O. No. 292, as amended by
R.A. 9849, namely:

New Year’s Day January 1

Maundy Thursday Movable Date
Good Friday Movable Date
Araw ng Kagitingan Monday nearest April 9
Labor Day May 1
Independence Day June12
National Heroes Day Last Monday of August
Eidl Fitr Movable Date
Eidl Adha Movable Date
Bonifacio Day Monday nearest November 30
Christmas Day December 25
Rizal Day Monday nearest December 30

1.1 When he reports for work, 200% of his daily wage plus 30% or 230% thereof
when it falls on his rest day plus ovetime pay of 30% of his hourly rate in excess of 8 hour
work.

1.2 Double holiday pay like April 9 or Holy/Maundy Thursday. He is entitled to

double payment of his daily wage even if he did not report for work on that day provided he

35
Art. 94, Idem;

16
reported for work or was on leave with pay on on Holy Wednesday. When he reported for
work, he is entitled to triple of his daily wage or 300% thereof.

1.4 When regular holiday falls on a Sunday, the following Monday is not a regular
holiday unless presidential proclamation is issued declaring Monday as a special non-working
holiday.

1.5 When on leave of absence with pay on the day immediately preceding the regular
holiday, entitled to holiday pay. If on leave of absence without pay on the day immediately
preceding the regular holiday, not entitled.

1.6 Employees are also entitled to such percentage of holiday pay as that of the
benefit granted in the form of Employees Compensation or SSS payment, whichever is higher,
when did not report for work while on such leave absence.

1.7 Where the day immediately preceding the regular holiday is a non-work day in the
establishment or the scheduled rest day of the employee, he shall not be deemed on leave of
absence on that day. On which case, he shall be entitled to holiday pay if he worked on the day
immediately preceding the no work day or rest day.

1.8 In case of two (2) successive regular holidays like Maundy Thursday and Good
Friday, he may not be paid for both holidays when he was absent on the day immediately
preceding Maundy Thursday. Unless he reports on Holy Thursday, he is entitled to his holiday
pay on Good Friday even he did not report for work.

1.9 In case of temporary or periodic shutdown and temporary cessation of work in the
establishment like yearly inventories, or repair or cleaning of machineries or equipment being is
undertaken, the regular holidays falling wihin the period is compensable.

1.10 Piece Rate Emloyees aare also entitled to holiday pay equivalent to not less than
the average daily earnings for the last seven (7) actual work days preceding the regular holiday
and that his holiday pay shall not be less than the minimum wage. He is also entitled to service
incentive leave and other leave benefits;

1.11 Seasonal worker are not entitled to holiday pay when not on work during off
season;

1.12 Wokers having no regular working days like stevedores are also entitled to
holiday pay.

17
 2. Premium Pay. It refers to additional compensation for work performed during eight (8)
hours on non-work days like rest days and special 0days. It covers all employees except: 1)
government employees; 2) Managerial employees and officers or members of the managerial
staff; 3) kasambahay and persons in the personal service of another; 4) workers paid by result
inclusive of piece rate workers, or takay, or pakyaw, or tasks basis, and other non-time work;
and 5) field personnel whose work is outside the principal office or branch office of the
employer whose actual hours of work in the field cannot be determined wih reasonable certainty.

2.1 The Special Days are: a) Ninoy Aquino Day; b) All Saints Day; and c) Last Day of
the Year;

2.2 The “No Work No Pay” principle applies during Special Days and such other
special days as proclaimed by the President or Congress.

2.3 Workers not required to work on Special Days are not entitled any compensation
except when expressly stipulated in the CBA or by employer’s voluntary practice.

2.4 When reported for work during Special Days, he is entitled to an additonal premium
pay of 30% of his daily wage or a total of 130%. When the Special Day falls on his rest day,
the premium pay is 50% or a total of 150%.

2.5 When reported for work on declared Special Working Day, no additional premium
pay because it is considered an ordinary work day.

3. Paternity Leave (R.A. 8187). Leave granted to all married male employees in the
private sector regardles of employment status to allow the husband to assit his wife during the
period of recovery or nursing his new born child.

3.1 Applies to first four (4) deliveries or miscarriage by his lawful wife with whom he
is cohabiting.

3.2 Entitlement also applies when they are physically not living together because of
work station or occupation.

3.3 Entitled to seven (7) days leave with full pay.

3.4 Availment is after delivery. May also be availed of prior to delivery upon
employer’s approval.

18
 3.4 Prior application is needed before the expected date of delivery except in case of
miscarriage.

3.5 Non-availment of Paternity Leave is not convertible into cash.

3.6 When in the CBA or Employer’s Policy/Practice, Paternity Leave is longer, the
same has to be given. If shorter, Paternity under the law shall be given.

3.7 Government employees are also entitled but shall be governed by the Civil Service
Commission.

4. Solo Parent’s Leave. In favor of an individual employee who is solo or alone with
the responsiblity of parenthood due to: a) giving birth consequent of rape or other crime against
chastity; b) Death of Spouse; c) Spouse is detained or serving sentence for at least one (1) year;
d) Physical or Mental incapacity of spouse as certified by a public Medical Practitioner; e) Legal
Separation or De Facto Separation for at least one (1) year when he or she is entrusted with the
custody of the children; f) Declaration of Nullity or Annulment as declared by the Court; g)
Abandonment of spouse for at least one (1) year; g) Unmarried father or mother who prefers to
keep his/her childrden with him/her; h) other person providing parental care and support to a
child or children provided that he is a duly license Foster Parent by the DSWD, or duly
appointed Legal Guardian by the Court; i) Any family member who assumes the responsibility of
Head of the family resulting from death, abandonment, disappearance , or prolonge absence of
the parents or solo parent for at least one (1) year.

4.1 Parental Leave Benefit of seven (7) paid full days every year of service.
4.2 Entitlement is at least one (1) year of service.
4.3 Benefit is not convertible into cash and non-cumulative when not availed.
4.4 Parental leave Benefit shall be terminated when he is no longer left alone in the
responsiblity of parenthood.
4.5 Discrimination against a solo parent is prohibited.

5. Battered Woman Leave. Leave is available to a woman employee who was a victim
of physical, pyschological, emotional and sexual abuse under R.A. 9262, otherwise known as
Violence against Women and her Children for such number of days she has to attend for medical
and legal concerns.

5.1 Requirement, Certification from Barangay, Prosecutor, or Court that an action on the
matter is pending.
5.2 Ten (10) days leave with full pay to be extended when the need arises as specified in
the Protection Order issued by the Court or the Barangay.

19
 5.3 Incovertible into cash and non-cumulative when not availed.

6. Special Leave for Women. When she sufferd “Gynecological Disorder” requiring
surgical procedures of her reproductive organs such as vagina, cervix uterus, fallopian tubes,
breast, adnexia and pelvic floor as certified by a competent physician. It also includes
hysterectomy, ovariectomy and mastectomy.

6.1 Two (2) months full pay leave benefit of her gross monthly compensation.
6.2 Availment is after undergoing surgery but wihout prejudice to advance payment
before or during surgery.
6.3 Non-convertible into cash and non-comulative when not availed.

7. Service Incentive Leave36 (SIL). Five (5) days service incentive leave pay per year of
service continous or not. Availment of service incentive leave is voluntary. When employee
does not avail, it is automatically commuted into cash. It does not accumulate. When already
receiving vacation leave or sick leave with pay of at least five (5) days in year, no more
entitlement for service incentive leave. It applies to all employees except those enjoying Holiday
Pay and Premium Pay.

7.1 Employers employing less than ten (10) employees in retail or service
establishments are exempted from paying Service Incentive Leave but subject to voluntary
practice or policy by the employer.

8. Service Charges37. All service charges being collected by Hotels, Restaurants,

Resorts, Night Clubs and similar establishments shall be divided in the propertion of 85% for all
covered Rank and File employees and 15% for the Management for breakages and losses to be
distributed to managerial employees . Employees’ share to be distributed among them equally
in case service charge is removed or abolished, the average share of the covered employees for
the last twelve (12) months immediately preceding the stoppage/removal shall be integrated on
their basic wage.

8.1 Dsitribution to employees is twice (2) a month at an interval not exceeding 16 days.

I. WAGES

Wage is remuneration or earnings, however designated, paid in money payable by the

employer to an employee under a written or unwritten contract of employment or work done, or

36
Art.95, Idem;

37
Art. 96, Idem;

20
to be done, or for services rendered, or to be rendered and includes the fair and reasonable value,
as determined by the Secretary of Labor, of board, lodging or other facilities customarily
furnished by the employer to the employee. Fair and reasonable does not include any profit of
the employer or to any person affiliated with his employer.38

1. No work No Pay Principle.

Employee shall be paid the fare day’s wage for a fair day’s labor. In other words, No
Work No Pay. It remains the basic factor for determining employees’ wage unless the worker
was able, willing and ready to work but was pevented by the management, or was illegally
locked-out, suspended, or dismissed. When employee fails to work not through employer’s
fault, the economic loss of the employee remains with him and should not be shifted to the
employer.

2. Equal Pay for Equal Work.

Employees having the same knowledge, skill, efforts and responsiblity shall be paid
equally. The fact that one is an alien and the others are filipinos but performing the same and
equal work with that of an alien employee, they should be paid the same wages, salaries and
benefits as that of an alien worker, or others of similarly situated.

3. Facilities.

Wage includes the facility being provided for by the employer to the employees like
lodging, board, and other facilities customoraly furnished by the employer to the employees. But
these facilities must be fair and reasonable and approved by the Secterary of Labor. Example is
food and lodging being provided by the employer. How much is the fair and reasonable value
thereof to be deducted from the employees’ salary. But for the value of facility to be deducted
from employees’ salary, the same has to be voluntarily accepted by the employees.

II. MINIMUM WAGE

1. Minimum Wage is the lowest wage rate fixed by law that an employer is bound to
pay his employees. Irrespective of the financial condition of the employer, he has to pay the
minimum wage of the employees. Payment of mimimum wage is based not on his ability to pay
but by law.

38
Art. 97 (f), Idem;

21
 1.1 Exemption from Minimum Wage. Employees of Barangay Micro Business
Enterprise (BMBE) registered under R.A. 9178 of November 13, 2002 approved by the DOLE
are exempt from payment of minimum wage.

1.2 Minimum Wage not uniform. Minimum wage is regional as determined by the
Regional Tripartite Wages and Productivity Board.

1.3 Industrial and Agricultural Rates. Agricultural wage rate is generally lower than
industrial wage rate. It is agriculural when the work is directly related to farm work. That is
from land preparation to harvesting. Industrial is work performed related to manufacturing or
processing of farm products.

1.4. In Metro Manila or NCR, the present minium wage rate is P 537.00 a day.
Outside Metro Manila, please see DOLE Regional Offices for the minimum wage on other
regions and subject to adjustment by the Tripartite Regional Wage and Productivity Board
(TRWPB) when the need arises.

2. Non-Dimunition Rule. It means that by employer’s policy or practice which

ripened into a policy, the benefit being given to employees cannot be taken back or
unilaterally reduce by the employer as it forms part of employees benefit, or has taken part of
the employment contract, written or not written.

2.1 Bonus. Generally bonus is not considered part of salary subejct to Non-Dimunition
Rule for it is being granted to an employee by way of recognition on his industry and loyalty
that contributed to success and relization of profits for the employer. It becomes covered by the
Non-Dimunition Rule when it is part and parcel of employees salary being given on a regular
basis like quarterly bonuses of bank employees with or without CBA.

2.2 Benefit derived from contingency or conditional benefit. Benefit of this nature is
not covered by Non-Dimunition Rule for it is based on coningency which may or may not
happen as that of incentive from sales beyond quota.

2.3 13th Month Pay. Covered by Non-Dimunition Rule provided employees have
worked for at least one (1) month for the calendar year.

2.3.1 An employee who resigned or was terminated prior to release of the 13th month
pay is entitled pro-rata to 13th month pay for the number of months of work prior to his
separation.

2.3.2 Piece Rate Employees are entitled to 13th Month Pay.

22
 2.3.3 Managerial employees. Exempt from 13th Month Pay except when there is already
an existing company policy giving them 13th Month Pay.

2.3.4 Employers already giving 13th Month Pay prior to the effectivity of the law (on
13th month pay) are exempt from giving 13th month pay.

2.3.5 Earnings and other remuniration which are not part of the basic salary are not
included in the computatiotn of 13th month pay.

2.3.6 13th Month Pay is exempt from income tax.

3. Payment by Results of Piece Rate Employees. They are also entitled to the usual
minimum wage, service incentive leave, nighshift diffrential pay, premium pay, holiday pay,
overtime pay, 13th month pay and other benefits granted by law.

III. PAYMENT OF WAGES

1. Payment of wages. Shall be in cash39. Payment in Check or Money Order is

allowable when that manner of payment was being made when the Labor Code took effect, or is
necessary because of special circumstances as stipulated in the CBA.

2. Contractor or Sub-Contractor for Job Contracting. The Contractor is not an

employee but an independent businessman. By contract, he renders the work for the employer.
He has subtantial capital or investment in the form of tools, equipment, machineries, work
premises, among others, to render the work for the employer. His employees are his own and not
the employees of the employer. The same is true with his sub-contractor, if any. If the contractor
or sub-contractor fails to pay the wages of his employees, the employer shal be jointly and
severally liable with his contractor or sub-contractor to such employees to the extent of the work
performed under the contract, in the same manner and extent that he is liable to employees
directly employed by him.40

The employer’s liability for unpaid wages of the employees of the contractor or sub-
contractor is only to the extent of the work performed under the contract between him and the
contractor or sub-contractor ( if there is any). The reason being that the work was performed in
favor of the employer who was benefited of the work done by contractor’s employees.
Employer’s recourse is again the contractor or sub-contractor.

39
Art. 102, Book III, Labor Code;
40
Art. 106, Idem;

23
 4. Labor Only Contracting. It exists when a person supplying workers for the
principal employer has no substantial capital or investment in the form of tools, equipment,
machineries, work premises, among others. The workers recruited and supplied by him to the
employer perform the work or activity directly related to the principal business of the employer.
In that case, the contractor (of labor only contracting) is only an agent of the employer who shall
be responsible to the workers as if they were his own employees. When they performed the
work for the employer for at least one (1) year, they are deemed regular employees of the
employer.

IV. PROHIBITION REGARDING WAGES

1. Non-interference on disposal of wages. Employer is prohibited from limiting or

interfering on disposition of employees’ wages. He shall not in any manner force, compel,
oblige his employees to purchase merchandise, commodities or other properties from the
employer, or from any other person, or otherwise make use of any store or service of such
employer or any other person.41”

2. Wage deduction by employer is not allowed42. Except:

2.1 Insurance premium on insurance policy advanced by the employer for insuracne
taken on the life of the employee with his consent;
2.2 Union Dues under Check-Off provision on the CBA and authorized by the
individual employees;
2.3 When employer is authorized by law or regulation like SSS, Pag-ibig and
Philhealth contribution, or upon Order of the Court, or for payment of debt to employer, or
payment to third person upon witten authorization by the employee, and deduction under Art.
114;

3. Withholding of wages and kickback prohibited43;

4. Deduction to ensure employment, illegal.44

5. Retaliatory measure through wage deduction or withholding of wages against an

employee who filed a complaint against the employer or who will testify against it in any
proceedings45

41
Art. 112, Idem;

42
Art. 113, Idem;
43
Art. 116, Idem;
44
Art. 117, Idem;

24
 “Wage Distortion” arises when the pay advantage of a position over another is removed
or significantly reduced by a pay adjustment required in a Wage Order, such pay advantage has
to and should be restored.

V. WORKING CONDITIONS FOR SPECIAL GROUP OF

EMPLOYEES

Employment of Women

1. Discrimination prohibited46. Discriminating woman employee on terms and

conditions of employment by reason of her gender is unlawful. The following are acts of
discrimination:

a) Lesser compensation, including wage, salary or other form of remuniration and

fringe benefits, as against a male employee, for work of equal value;

b) Favoring a male employee over a female employee with respect to promotion,

trainng opportunities, study and scholarship grants on account of their sexes. Violation under this
article is criminal in character;

2. Stipulation against Marriage47. Stipulation of this kind as pre-requisite for

employment or for continuous employment, or that upon getting married, she shall be deemed
separated or dismissed from employment is unlawful;

3. Prohibited acts. It is unlawful for any employer to:

a) Deny any woman employee the benefits under this Chapter or to discharge any
woman employed for the purpose of prevening her from enjoying any of the benefits under this
Code;

b) Discharge a woman employee on account of her pregnancy, or while on leave,

or or in confinement due to pregnancy;

c) Discharge or refuse admission of such woman upon returning to her work for
fear of another pregnancy;

45
Art. 118, Idem;
46
Art. 135, Idem;

47
Art. 136, Idem;

25
 4. Women working in Night Clubs, Cocktail Lounges, Massage Clinics, Bars or
similar establishments under the effective control and supervision of the employer for substantial
period of time, are considered employees of the employer for the purpose of labor and social
legislation

ASSESSMENT

1) When is there employer-employee relationship?

2) What is the most important requisites to determine employer-employee relationship?
3) By Labor Standards means what?
4) What is Management Prerogative? What is the limitation on the exercise of
Management Prerogative?
5) Hours worked mean?
6) What is Night Shift Dirrential Pay?
7) Compute the overtie pay of an employee who worked rendered service for ten (10)
hours on:
a) Regular day;
b) Rest day;
c) When rest day falls on special holiday;
8) When is an employee entitled to 300% of his daily wage?
9) What is Holiday Pay?
10) In a Covenience Stor, there are only 3 employees. Are they entitled to Holiday Pay?
11) What is Premium Pay?
12) Discuss briefly the Special Leaves under the special laws of thie creation?
13) Wages are composed of: ________________ and _________________;
14) What is the so called Non-Diminution Rule?
15) What is Job Contracting?
16) What is Labor only Contracting?
17) What is the liability, if there is any, of the employer to the employees of the
Contractor?
18) Whose employees are employees of the Labor only Contractor?
19) Whast is Wage Distortion?
20) Are GROs regular employees?

MODULE IV (BOOK IV)

HEALTHY, SAFETY AND SOCIAL WELFARE BENEFITS

I. MEDICAL, DENTAL AND OCCUPATIONAL SAFETY

26
 Medical and Dental Services48 have to be provided by the employer consisting of:

1. First Aid Treatment; and

2. Emergency Medical and Dental Services49

2.1. 50-200 employees, one (1) registered nurse. Not hazardous undertaking, graduate
First Aider will do when no registered nurse is svailable;
2.2. 200-300 employees, one (1) full time registered nurse and a part time Physician;
2.3. More than 300 employees, one (1) full time Physician, Dentist and registerd
Nurse with a Dental Clinic, and an Infimary or Emergency Hospital with one (1) bed capacity
for every 100 employees;
2.4. In case of hazarous workplaces, one (1) Physician and Dentist for at least 2
hours for Part Time Services, at least 8 hours for full time servcies;
2.5. When the undertaking is non-hazardous, the Physician and Dentist may be
engaged on Retainer basis;

However, an emergency Hospital or Dental clinic are not requried if there is a Hospital
or Dental Clinic which is accessible (at least within five (5) kilometers, or within 25 minutes
travel) from the establishment and employer makes arrangement for the reservation therein of
the necessary beds andd dental facilities for use of his employees50.

Employers are mandated to provide the needed assistance to ensure adequate and
immediate Medical and Dental attendance and treatment to an injured or sick employee in case
of emergency.51

II. OCCUPATIONAL HEALTH AND SAFETY

It is required that in all establishments, employees’ health and safety have to be taken
cared of. For the purpose, the Secretary of Labor shall set and enforce mandatory occupational
safety and health standards to reduce if not to eleminate occupation safety and health hazards and
institute programs to ensure safe and healthy working conditions in all places of establisments.52

48
Arts. 156 to 157, Book IV, Labor Code;
49
Art. 157, Idem;

50
Art. 158, Idem;
51
Art. 161, Idem;
52
Art. 162, Idem;

27
 III. EMPLOYEES’ COMPENSATION AND STATE INSURANCE FUND
1) It is the policy of the state to promote and develope a tax free employee’s
compensation program whereby employees and their dependents in the event of work related
disability, or death, may promptly secure adequate income and medical or related benefits.53

2) Under the law, an injury or death to be compensable under Employee’s

Compensation and State Insurance Fund, it must: 1) arose from accident; and 2) in the course
of employment, or simply stated work related/connected. In case of sickness, it must be the
result of an occupational disease listed under the implementing rules of the program. If not, it
must be proven that the risk of contracting the disease has been increased by the working
conditions.

3) For off-premises injury or death, that is injury or death sustained when an

employee is going to or coming from the work establishment, the same is compensable when: 1)
the act of the employee in going to or coming from the workplace is continuous and there is no
diversion for any other activity an has not departed from the usual route to or from his
workplace; and 2) the employee is on special errand and the same is official and in connection
with his work.

4) Death or injury sustained from outings and related recreational acivities when
sponsored by the employer is compsensable except in case of self-inflicted death or injury.

5) If death or injury is sustained when an employee is on a trip in the performance

of the job and at the same time for his personal needs or purpose, the same is compensable.

IV. COVERAGE AND LIABILITY

1. Coverage in the State Assurance Fund is compusory upon all employers and their
employees not over sixty (60) years old. Over 60 but still paying contribution to the SSS for life
or retirement insurance benefits is also covered.54 Coverage shall commence on the first day of
operation by the employer and the employee on the date of his employment. Registraion of the
employer and employee with the ECC is mandatory.

2. The extent of the State Insurance Fund’s liability is exclusive of all other liabilities
of the employer to the employee or his beneficiary, and from all other benefits/claims that the
empployee may have from other souces.55

53
Art. 166, Idem;

54
Art. 168, Idem;
55
Rt. 175, Idem;

28
 3) For work related death or injury, the State Insurance Fund is liable for compensation
to employee or his dependent exept when occasioned by intoxication, self-inflicted injury or
death, notorious negligence, or as otherwise provided under the Employees Compensation and
State Insurance Fund.56

4) When employee’s disablity or death is caused by a third person, the system will
also compensate the employee who shall be subrogated to run against the third person. In case
of an excess in collection, it shall be given to the employee or his beneficiary less the cost of
proceedings.57

6) The benefits to be derived from the ECC are: a) Medical Benefit which are
medical services and rehabilitation services if needed; b) Disability benefit; and c) Death
benefit consisting of employees’ monthly income benefit plus 10% thereof for each dependent
child not exceeding five (5); and d) P 15,000.00 Funeral Benefit. The same amount of benefit
shall be given for permanent total and permanent partial disability.

7) The period of claim shall be within three (3) years from the time of of disability or
58
death.

ASSESSMENT

1) Peter is a Chemist and working with Petrophil Chemical Plant and receives a
salary of P 100,000.00 a month exlcusive of allowances. Diagnosed with Cancer, he took a
Leave of Absence for thirty (30) days with pay. Before the expiration of his leave, he dies. His
wife as primary beneficiary files a claim for Death Benefit from the Employees Compensation
Commission and State Assurance Fund. It denied the claim on the ground that Peter’s illness
that caused his death is not work related. Decides briefly with legal reason.

V. MODULE V (BOOK V)
LABOR RELATIONS

Labor legislation is classified into:

a. Labor Relations; and

b. Labor Standards

56
Art.172, Idem;
57
Art. 174, Idem;
58
Art.201, Idem;

29
 Labor relations – is that part of Labor Law regulating the relations between employers
and workers.

Examples are: 1) Labor Organizations; 2) Collective Bargaining; 3) Grievance

Machinery; 4) Voluntary Arbitration; 5) Conciliation and Mediation; 6) Unfair Labor Practices
(ULP); 7) Strikes; 8) Picketing and Lockout.

Detailed discussion on Labor Relations will no longer be presented and discussed on this
instructional materials for they are proper and appropriate for Law Proper Students and not for
Pe-Law Students.

Labor standards – on the other hand are provisions thereof prescribing the minimum
terms and conditions of employment required of an employer to give to its/his employees. They
are only the minimum standards. The employer can offer much higher standard.

Examples are: 1) Wages; 2) Hours of Work; 3) Holiday Pay and other Benefits; 4)
Conditions of Employment; 5) Special provions on Women Employees; 6) Learners; 7)
Apprentices; 8) Homeworkers; 9) Workers paid by Result or Piece Rate Workers; 10) Medical
and Dental Services; 11) Occupational Health and Safety; 12) Termination of employment;
and 13) Retirement Benefit;

VI. MODULE VI (BOOK VI)

I. POST-EMPLOYMENT

Constitutional Balance on protection to labor.

The Supreme Court in interpreting protection to labor held: “ When the interests of labor
and capital collide, the heavier influence of capital, should be counter balanced with the
sympathy and compassion of law for the less privileged workers.(Fuentes, 266 SCRA 24,1997)

1. Coverage. The provision of Post Employment shall apply to all establishments or

undertaking, whether for profit or not59. Simply stated, the worker of an establishment whether
operating for profit or not (like Churches, Non-profit Organization, etc.) are entitled to their
security tenure and all benefits under the Labor Code.

2. Security of tenure. In cases of regular employment, the employer shall not terminate
the services of an employee except for just cause or when authorized by this title. An employee
who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority
rights and other privileges and to his full backwages, inclusive of allowances, and to his other

59
Art. 278, Book VI, Labor Code;

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benefits or their monetary equivalent computed from the time his compensation was withheld
from him up to the time of his actual reinstatement60(as amended by se. 34, RA 6715).

Stated otherwise, security of tenure means an employee cannot be terminated from work
without just cause or can be terminated upon authorized cause. Just causes are those mentioned
in Art. 282 of the Labor Code. Authorized causes are those mentioned in Art. 283 thereof.

For purposes of the title on Post-Employment, workers, in general, are classified into:

1. Regular; and
2. Casual

Regular - The provision of written agreement to the contrary nothwithstanding 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 season61.

The important criteria is, when the work being undetaken when hired is necesary or
desirable to the usual business or trade of the employer for as long as it is not for a specific
project or undertaking (completion or termination was determined at the time of engagement),
or where the work or services to be performed is seasonal in nature and for the duration thereof.
When not project base or seasonal and the work is necesary or desirable to the usual trade or
business of the employer, he is a regular employee and as such, is entitled to security of tenure,
wages, separation pay (when terminated for authorized cause), Retirement Benefit and all other
benefits under the law.

Casual - An employment shall be deemed casual if it is not covered by the preceding

paragraph: Provided, That any employee who has rendered at least one year of service, whether
such service is continuous or broken, shall be considered a regular employee with respect to the
activity in which he is employed and his employment shall continue while such activity exists62”.

A casual employee performs job or undertaking not necessary or desirable in the usual
trade or business of the employer. Meaning, the employer can operate the business even without
the need of a casual worker. Examples: a Parking Boy/Aide of a Restaurant, an Elevator Boy on
establishments with Self-Operated Elevator, A Utility Boy in a bank, etc. However, if such
work lasted for at least one (1) year of service, whether said work is continous or broken, and

60
Art. 279, Idem;
61
Art. 280, 1st Par., Idem;

62
Art.280, 2nd Par.,Idem;

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was continued by the employer, then he becomes regular employee with respect to the activity in
which he is employed.

A Project Base Employee is one whose 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. Ex. A worker hired until the completion or termination of a
particulr survey. Even if completetion lasted for more than six (6) months, he is still a project
base employee.

Regular Seasonal Employment. Regular seasonal employment are those called to work
from time to time. The tenure of their relationship with the employer is such that during off
season they are temporarily laid off but during the season, they are re-employed, or when their
services may be needed. Their employment relationship is never severed but only suspended. As
such those employees can be considered as in the regular employment of the employer.(Manila
Hotel ,September 30, 1963; Industrial Commercial, March 31, 1966, Tacloban Sangkahan Rice,
Marh 21, 1990)”

3. Probationary Employment. Probationary employment shall not exceed six(6) months

from the date the employee started working, unless it is covered by an apprenticeship agreement
stipulating a longer period. The services of an employee who has been engaged on a
probationary basis maybe terminated for just cause or when he fails to qualify as a regular
employee in accordance with reasonable standards made known by the employer to the
employee at the time of his engagement. An employee who is allowed to work after a
probationary period shall be considered a regular employee.

4. Fixed Period Employment. It refers to an employment whereby the worker is hired for
a fixed term covered by Contract between the parties. They are also known as Contractual
Employees. The length of the term is immaterial. It may be for two or there years or more for
each term. When the term expires and he is not rehired, the worker will not attain regular status.
But even though the term is three (3) months only but repeatedly re-hired by the same employer
and for the same undertaking and the total period of work performed reaches to at least one (1)
year or more, the worker is deemed a regular employee. Examples are Seafarers. They are
contructual employees being hired by different principal employers.

I. TERMINATION BY EMPLOYER

An employer may terminate an employment for any of the following causes63:

1) Serious misconduct or willful diobedience by the employee of the lawful orders

of his employer or representative in connection with his work.

63
Art. 282, Book Vi, Labor Code;

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 2) Gross and habitual neglect by the employee of the trust reposed on him by his
employer or duly authorized representative;

3) Fraud or willful breach by the employee of the trust reposed on him by his
employer or duly authorized representative;

4) Commission of a crime or offense by the employee against the person of his

employer or any immediate member of his family or his duly authorized representative; and

5) Other causes analogous to the foregoing.

The above-cited grounds are called “Just Causes” for terminating the services of an
employee. When no legal ground exists, employer mus exercise caution in dismissing an
employee for the state will not hesistate to come to his rescue wrongly dismissed by capricious
employer.

Although Just Cause exists, observance of due process is a must before an employee may
be dismissed. The due process required is the “Two (2) Notice Rule” which are:

1) A notice charging the employee of the particular acts or ommisions that may cause
his dismissal;

2) The subsequent notice informing the employee of the employer’s decision.

But in between, an administrative investigation should be conducted giving the employee the
opportunjity to be heard who is even entitled to the services of a lawyer of his own choice. If he
is dismissed without observance of due process, the dismissal is still valid but the employer is
liable for tempered indemnity in favor of the employee.

Maximum 30 day Preventive Suspension is justified only when employee’s continued

employment poses a serious and imminent threat to the life or property of the employer, or to his
co-workers. Without this threat, preventive suspension is not proper.

Employer has the burden of proof in proving the ground for dismissal of the employee
and not for the latter to prove his innocence. By law, unless proven guilty, employee remains
innocent.

The administrative investigation is not required when employee admitted the violation.

The “Authorized Causes”64 are the following:

1) Installation of Labor Saving Devices;

2) Redundancy;
3) Retrenchment to prevent losses;
64
Art. 283, Idem;

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 4) Closure or cessation of operation of the establsihment or undertaking unless
closure is for the purpose of circumventing the law;
5) Disease65;

Requirement for valid dismisal on ground of Authorized Causes:

1) 30 day written notice to employee and the Secretary of Labor of the cause for
dismissal prior to his dismissal; and

2) Payment of Separation Pay equivalent to:

2.1) At least one (1) month pay or one (1) month pay for every year of service in case
of Installation of Labor Saving Devices or Redundancy whichever is higher;

2.2) At least one (1) month pay or half month pay for every year of service, which ever
is higher, in case of Retrenchment to prevent losses or Closure or Cessation of operation of
business or establishment;

2.3) At least one month pay or half (1/2) month pay per every year of service which ever
is higher when an employee has been found suffering from a disease and whose continued
employment is prohibited by law, or is prejudicial to his health as well as the health of his co-
employees;

2.4) Allowance is included on the computation of Separation Pay;

2.5) In all authorized causes, a fraction of at least six (6) months shall be considered as
one whole year;

II. TERMINATION BY EMPLOYEE.

a) An employee may terminate without just cause the employee-employer

relationship by serving a written notice to the employer at least one(1) month in advance. The
employer upon whom no such notice was served may hold the employee liable for damages.

b) An employee may put an end to the relationship without serving any notice on the
employer for any of the following just causes:

1. Serious insult by the employer or his representative on the honor and person of the
employee;
2. Inhumane and unbearable treatment accorded the employee by the employer or
his representative.

65
Art. 284, Idem;

34
 3. Commission of a crime or offense by the employer or his representative against
the person of the employee or any of the immediate members of his family; and
4. Other cauases analogous to any of the foregoing.66

III. RETIREMENT FROM SERVICE

1. Retirement Benefit67. Half (1/2) month salary per every year of service. For
entitlement, the requisites are:

a) 60 years of age or more but not exceeding 65 (compulsory retirement age), or the
Retirement Age under the Collective Barganining Agreement (CBA), or other applicable
Employment Contract if there is any;
b) Has served at least five (5) years. A fraction of at least six (6) months is
considered one (1) whole year;

Half (1/2) month salary is fifteen (15) days plus one twelfth (1/12) of the 13th month pay
and cash equivalent of not more than five (5) days of service incentive leave.

2. For underground mining employees, at least 50 years of age or more but not
exceeding 60 who has served for at least five (5) years as udnerground worker;

3. Other benefits maybe included in the computation of the retirement pay upon
agreement of the employer and the employee or if provided in the Collective Bargaining
Agreement (CBA). Provided, however, that such retirement benefits shall not be less than the
retirement pay required under R.A 7641, and provided further that if such retirement benfits
under the agreement are less, the employer shall pay the difference.

4. Where both the employer and the employee contribute to a retirement fund
pursuant to the applicable agreement, the employer’s total contributions and the accrued interest
thereof should not less than the total retirement benefits to which the employee would have been
entitled had there been no such retirement fund. If such total portion from the employer is less,
the employer shall pay the deficiency.

6. Retirement Benefits of workers who are Paid by Results. For covered workers
who are paid by results and donot have a fixed monthly salary rate, the basis for the
determination of the salary for fifteen(15) days shall be thier average daily salary(ADS) . The
ADS is derived by dividing the total salary or earnings for the last twelve months reckoned from
the date of retirement by the number of actual working days in that particular period, provided

66
Art. 285, Boor VI, Labor Code;
67
Art. 302, Labor Code;

35
that the determination of rates of payment by results are in accordance with the established
regulations.

7. Retirement Benefit of Part – time Workers. Part time workers are also entitled to
retirement pay of “one-half month salary” for every year of service under RA 7641 after
satisfying the following conditions precedent for optional retirement:

a) There is retirement plan between the employer and the employee and
b) The employee should have reached the age of sixty (60) years, and should have
rendered at least five (5) years of service with the employer.

Applying the foregoing principle, the components of retirement benefit of part time
workers may likewise be computed at least in proportion to the salary and related benefits due
them.

8. Retail, service and agricultural establishments or operations employing not more

than ten (10) employees are exempt from covergage of Retirement Benefit.

ASSESSMENT

1) What is Security of Tenure?

2) Who are covered by Security of Tenure?
3) Kinds of employees in general?
4) Distnction between regular and casual emoloyees;
5) What just causes for terminating the service of an employee?
6) Are Probationary Employees regular employees?
7) What are the just causes for terminating the servicesof an employee?
8) What are the authorized causes and the requirements for termiating the servces of an
employee?
9) What must be undertaken before an employee may be terminated legally? When is it
dispensed?
10) What happens when the services of an employee is terminated for just cause but
without obervance of the needed due process?
11) How much is an employee entitled to receive by way retirement benefit?

MODULE VII (BOOK VII AND SOCIAL LEGISLATIONS)

I. PENAL PROVISIONS AND LIABILITIES

1. Penalties. Any violaton of the Labor Code declared unlawful or penal in nature.
Fine of P1,000.000 but not more than P 10,000.00 , or imprisonment of not less than three (3)

36
months but not more than three (3) years, or both fine and imprisonment at the discretion of the
Court;

2. When offense committed by a corporation, trust, firm, partnership, association, or

other entity, the penalty shall be imposed upon the guilty officer or officers of such corporation,
etc.;

II. PRESCRIPTION OF OFFENSES AND CLAIMS

1. Offenses unde the Labor Code prescribes in three (3) years from time commission;

2. If violation is Unfair Labor Practice (ULP), within one (1) year from commission
thereof;

3. All Money Claims arising from employer-employee relationship presribed in three (3)
years from accrual or from thetime the cause of action accrues;

III. JURISDICTION IN LABOR CASES

The Quasi-Judicial Bodies that exercise jurisdiction over labor cases are:

A. Original Jurisdiction:

1. Labor Arbiters;
2. National Labor Relations Commission (NLRC);
3 Secretary of Labor and Employment/his duly authorized representatives;
4. DOLE Regional Directors/duly authorized hearing officers;
5. Grievance Machinery and Voluntary Arbitrators;
6 Bureau of Labor Relations (BLR)/Regional Office;
7. Med-Arbiters;
8 National Conciliation and Mediation Board (NCMB); and
9. Philippine Overseas Employment Administration (POEA) for Seafarers and Land Base
OFW; .

B. Appellate Jurisdiction:

1. National Labor Relations Commission (NLRC);

2. Secretary of Labor and Employment; and
3. Director of the Bureau of Labor Relations.

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 Jurisdiction68 of Labor Arbiters are original and exclusive. The cases under the
jurisdiction of the Labor Arbiters are:

1. Unfair Labor Practice (ULP) cases;

2. Termination disputes (or illegal dismissal cases);

3. Cases that workers may file involving wages, rates of pay, hours of work and other
terms and conditions of employment, if accompanied with claim for reinstatement;

4. Claims for actual, moral, exemplary and other forms of damages arising from the
employer-employee relations;

5. Cases arising from any violation of Article 264 of this Code, including questions
involving the legality of strikes and lockouts;

9. Except claims for Employees’ Compensation, Social Security, and Maternity

Benefit, all other claims arising from employer-employee relations, including those of persons in
domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00)
regardless of whether accompanied with a claim for reinstatement;

10. Wage distortion disputes in an unorganized establishments not voluntarily settled

by the parties pursuant to R.A. No. 6727;

11. All money claims arising out of employer-employee relationship, or by virtue of

any law, or contract involving filipino workers for overseas deployment, including claims for
actual, moral, exemplary and other forms of damages as provided by Sec. 10, R.A. 8042, as
amended by R.A. 10022;

12. Enforcement of Compromise Agreements upon non-compliance by any of the

parties pursuant to Art. 227 (now 233) of the Labor Code; and

13. Other cases as may be provided by law;

Cases arising from from the interpretation and Collective Bargaining Agreements and
those arising from the interpretation of enforcement of company personnel policies shall be
disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary
arbitration, as may be provided in said agreements.

68
Rule V, 2011 NLRC Rules of Procedure;

38
 SOCIAL LEGISLATION
Social legislations are laws enacted to ease the burden of the people especially the less
privilege from economic hardship implementing the Social Justice provision of the Philippine
Consttitution.

For purposes of this Instructional Materials, the Social Legislations that will be briefly
discussed are:

1. The Social Security Benefits under the SSS;

2. Pag-ibig Benefit;
3. Philhealth Benefit;

I. SOCIAL SECURITY BENEFIT UNDER THE SSS

1. Social Security Program. It is the package of benefits in case of Death, Disability,

Sickness, Maternity, and Old Age. It is a replacement of income lost for the said contingencies.

2. Coverage. Private employees whether permanent, temporary or provisional.

3. Benefits.

3.1 Sickness Benefit- is the daily allowance paid for the number of days a member is
unable to work due to sickness or injury when:

a. He is unable to work due to sickness or injury and is confined either in a hospital

or at home for at least four (4) days;

b. Has paid at least three (3) monthly contributions within the twelve (120 month
period immediately before the semester of sickness;

c. Has used all current company sick leaves with pay for the current year; and
d. Notice to his employer;

The sickness benefit is 90% of the average daily salary credit x the approved number of
days.

3.2 Disability Benefit – is a Cash Benefit paid to a member who becomes permanently
disabled, either partially or totally.

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 3.2.1 Permanent Total Disability:
Complete Loss of sight of both eyes
Loss of two (2) limbs at or above the ankle or wrists;
Permanent comlete paralysis of two (2) limbs
Brain injury causing insanity; and
Other cases as determined and approved by the SSS

3.2.2 Permanent Partial Disability:

Permanent and complete loss of use of any of the ff parts of the body:

One thumb, one inder finger, one middle finger, one ring finger, one little finger
Loss of sight of one eye, hearing ear, both ears
Loss of one (1) foot, one leg, one big toes, one hand, one arm, one ear, and both ears

3.3 Disability Benefit is monthly pension provided the member has paid at least 36
monthly contributions; or lump sum amount for tose not able to pay 36 monthly contributions.

4. Retirement Benefit. Monthly Pension for members who are 60 years old who have
paid at least 120 monthly contributions prior to the semester of retirement; or 65 years old,
employed or not, but who paid at least 120 monthly contributions prior to the semester of
retirement;

Lump sum benefit when not able to pay at least 120 monthly contributions.

5. Death and Funeral Benefit – is cash paid to the beneficiaries of a deceased

member. The primary beneficiaries are the legitmate dependednt spouse until he/she remarries
and legitimate, legitimated, legally adopted or illegitimate dependent children of the member. In
the absence of primary beneficiaries, the secondary beneficiaries are the dependent parents. On
their absence, the person desidgnated by the member as beneficiary on his record as member will
be the recipient.

The benefits are: 1) Monthly pension to the primary beneficiary when able to pay at
least 36 monthly contributions before the semestr of death; 2) lump sum benefit when not able to
pay at least 36 monthly contributions before the semester of death; and 3) P 25,000.00 Burial
Benefit.

6. Maternity Benefit (.A.11210). It applies to a female employees, married or

unmarried. Private or Public employment.

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 6.1 Benefit 105 days of 100% average salary credit for every delivery normal or
caesarian regardless of frequency. 60 days of average salary credit in case of miscarriage or
emergeny terminaton of pregnancy. Provided, she was able to pay at least three (3) monthly
contributions in the 12th month period immediately preceding the semester of childbirth,
miscarriage or emergency termnination of pregnancy, and with notice to employer.

6.2 Plus 15 day thereof if she is a Solo Parent with option to extend until 30 days.

Penalty. Employer who refuses to comply with the provision of Maternity Leave Law is
criminally liable and shall suffer the penalty of P20,000.00 to P 200,000.00 fine and
imprisonment of 6 years and 1 day to 12 years plus cancellation of his Business Permit.

PAG-IBIG BENEFITS UNDER R.A. 9679

1. The Home Development Mutual Fund (HDMF), otherwise known as PAG-IBIG

(Pagtutulungan sa Kinabukasan: Ikaw, Bangko, Industriya at Gobyerno) Fund is a provident
mutual savings system for private and governmentg employees and other earning groups,
supported by matching mandatory contributions of their respective employers with housing as
the primary investment.

2 Coverage. All employees who are or ought to be covered by the Social Security
System (SSS), provided that actual membership in the SSS shal not be a condition precedent to t
majority coverage in the Fund. It shall included but are not limited to:

a. Private employee whether permanent, temporary or provisional who is not over 60

years old;
b. Household helper earning at least P 1,000.00 a month. Like driver, gardener,
cook, governess and other similar occupations;

c. Filipino Seafarer upon signing of the contract between him and the manning agent
which together with the foreign ship owner acts as an employer;

d. Self-employed peson regardless of trade, business or occupation with income of

at least P1,000.00 a month and not over 60 years old;

An Expatriate who is not mre than 60 yeasr old compulsorily covered by SSS regardless
of citizenship, nature and dura tion of employment, and the manner by which the compensation
is paid who upon assumtion of offie is covered by by the Fund;

41
 An Expatriate is a citizen of another country who is living and working in the Philipines.
a) Government employees covered by GSIS including
members of the Judiciary and Constitutional Commissions;

b) Uniformed members of the AFP, Bureau of Fire, BJMP and PNP;

c) Filipinos employed by Foreign Based Employers whether deployed here or

abroad or a combination thereof;

3. Voluntary Membership. An individual at least 18 years but not more than 65 is

qualified for voluntary membership.

4. Benefits – 1) Savings; 2) Short Term Loans; and 3) Housing Programs;

7. Contribution – Minimum of P 100.00 for the employee and P200.00 for the
employer;

8. Refund of Contributions. When no loan has been availed, full refund of

constributions (employee and employer’s share) upon retirement at the age of 60 or 65 or upon
separation from service;

PHILHEALTH BENEFITS UNDER R.A. 7875, AS AMENDED BY R.A. 9241

1. The National Health Insurance Program (NHP) formerly known as Medicare is a

health insurance program for SSS Members and their dependents whereby the healthy subsidizes
the sick who may find themselves in need of financial assistance when hospitalized.

2. Covered are: 1) Members of the formal economy who are employed with
thegovernment or private employer whose contributions are shared equally by the employer;

2.1 Sponsored Members whose contribution are being paid by another individual,
government agencies or private entities;

2.2 Members of the Informal Economy who are self-earning up to migrant worker
individuals;
2.3 Lifetime Members who have reached retirement age and have paid at least 120
monthly premium; 5) Indigent Members who have no visible means of income or whose income
is insufficient for family subsistence as identified by the DSWD;

42
 2.4. Senior Citizens who are 60 year old and above not currently covered by any
existing membership categories of Philhealth;

3. Benefits:

3.1 Inpatient Hospital Care;

3.2 Outpatient Care;

ASSESSMENT

1. When can an employee file a complaint for claim of money against the employer?
To whom is the complaint should be filed?
2. What is the criminal liability of employers who refuse to comply with the terms
and conditions of employment. When should the criminal complaint be filed?
3. What is Social Legislation?
4. What is the legal basis thereof?
5. What are the benefits under the SSS, Pag-ibig and Philhealth?

- End -

Compiled by: Edgardo A. Arandia, Faculty, College of Acountancy and Finance

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