Week 1 - Fundamental Principles

Question 1

Persons who work with substantially equal qualifications, skill, effort and responsibility, under similar conditions, should be paid similar salaries.

Answer 1

ISAE v. Quisumbing GR No. 128845

Question 2

CONST. Art. II SECTION 9. The State shall promote a just and dynamic social order that will ensure the prosperity and independence of the nation and free the people from poverty through policies that provide […].

Answer 2

Art. II. SECTION 9. The State shall promote a just and dynamic social order that will ensure the prosperity and independence of the nation and free the people from poverty through policies that provide adequate social services, promote full employment, a rising standard of living, and an improved quality of life for all.

Question 3

CONST. Art. II. SECTION 10. The State shall promote […] in all phases of national development.

Answer 3

CONST. Art. II. SECTION 10. The State shall promote social justice in all phases of national development.

Question 4

CONST. Art. II. SECTION 11. The State values the […] and guarantees […].

Answer 4

CONST. Art. II. SECTION 11. The State values the dignity of every human person and guarantees full respect for human rights.

Question 5

CONST. Art. II SECTION 18. The State affirms labor as […]. It shall protect the […].

Answer 5

CONST. Art. II SECTION 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare.

Question 6

CONST. Art. II. SECTION 20. The State recognizes the indispensable role of the […].

Answer 6

CONST. Art. II. SECTION 20. The State recognizes the indispensable role of the private sector, encourages private enterprise, and provides incentives to needed investments.

Question 7

CONST. Art. III. Sec. 1. [no clue. if you don’t now this, why are you in law school.]

Answer 7

CONST. Art. III. SECTION 1. No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws.

Question 8

CONST. Art. III. Sec. 4. [clue: freedom of speech; redress of grievances]

Answer 8

CONST. Art. III. SECTION 4. No law shall be passed abridging the freedom of speech, of expression, or of the press, or the right of the people peaceably to assemble and petition the government for redress of grievances.

Question 9

Const. Art. III. Sec. 8. [clue: right to union]

Answer 9

CONST. Art. III. SECTION 8. The right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law shall not be abridged.

Question 10

CONST. Art. III. Sec. 18. [clue: involuntary servitude]

Answer 10

CONST. Art. III. SECTION 18. (1) No person shall be detained solely by reason of his political beliefs and aspirations.

(2) No involuntary servitude in any form shall exist except as a punishment for a crime whereof the party shall have been duly convicted.

Question 11

CONST. Art. XIII. Sec. 1.

Answer 11

CONST. Art. XIII. SECTION 1. The Congress shall give highest priority to the enactment of measures that protect and enhance the right of all the people to human dignity, reduce social, economic, and political inequalities, and 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.

Question 12

CONST. Art. XIII. Sec. 2.

Answer 12

CONST. Art. XIII. SECTION 2. The promotion of social justice shall include the commitment to create economic opportunities based on freedom of initiative and self-reliance.

Question 13

CONST. Art. XIII. SECTION 3. par. 1. The State shall afford full protection to […].

Answer 13

CONST. Art. XIII. SECTION 3. par. 1. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all.

Question 14

CONST. Art. XIII. SECTION 3. par. 2. It shall guarantee the […], including the right to […]. They shall be entitled to […]. They shall also participate in policy and decision-making processes affecting […] as may be provided by law.

Answer 14

CONST. Art. XIII. SECTION 3. par. 2. It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law.

Question 15

CONST. Art. XIII. SECTION 14. The State shall protect […] conditions, taking into account their […], and such facilities and opportunities that will enhance their welfare and enable them to realize their full potential in the service of the nation.

Answer 15

CONST. Art. XIII. SECTION 14. The State shall protect working women by providing safe and healthful working conditions, taking into account their maternal functions, and such facilities and opportunities that will enhance their welfare and enable them to realize their full potential in the service of the nation.

Question 16

Fuentes v. NLRC GR No. 110017

Answer 16

“This Court firmly holds that measures should be strictly implemented to ensure that such constitutional mandate on protection of labor is not rendered meaningless by an erroneous interpretation of applicable laws.” [Fuentes v. NLRC GR No. 110017]

Question 17

Gracia vs. NLRC GR No. 110518

Answer 17

“The constitutional policy of providing full protection to labor is not intended to oppress or destroy management. The employer cannot be compelled to retain employees it no longer needs, to be paid for work unreasonably refused and not actually performed. NASECO bent over backward and exerted every effort to help the petitioners look for other work, postponed the effective date of their separation, and offered them a generous termination pay package. The unflagging commitment of this Court to the cause of labor will not prevent us from sustaining the employer when it is in the right, as in this case.” [Gracia vs. NLRC GR No. 110518]

Question 18

NCC. Art. 19. E P M, I T E O H R, A I T P O H D, A W J, G E H D, A O H A G F.

Answer 18

NCC. Art. 19. Every person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith.

Question 19

NCC. Art. 20. E P W, C T L, W O N C D T A, S I T L F T S.

Answer 19

NCC. Art. 20. Every person who, contrary to law, wilfully or negligently causes damage to another, shall indemnify the latter for the same.

Question 20

NCC. Art. 21. A P W W C L O I T A I A M T I C T M, G C O P P S C T L F T D.

Answer 20

NCC. Art. 21. Any person who wilfully causes loss or injury to another in a manner that is contrary to morals, good customs or public policy shall compensate the latter for the damage.

Question 21

NCC. Art. 1700. The relation between […] are not merely contractual. They are so impressed with public interest that […]. Therefore, such contracts are subject to the […] and similar subjects.

Answer 21

NCC. Art. 1700. The relation between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good. Therefore, such contracts are subject to the special laws on labor unions, collective bargaining, strikes and lockouts, closed shops, wages, working conditions, hours of labor and similar subjects.

Question 22

NCC. Art. 1702. Neither capital nor labor shall act […], or impair the interest or convenience of the public.

Answer 22

NCC. Art. 1702. Neither capital nor labor shall act oppressively against the other, or impair the interest or convenience of the public.

Question 23

NCC. Art. 1702. In case of doubt, all labor legislation and all labor contracts shall […].

Answer 23

NCC. Art. 1702. In case of doubt, all labor legislation and all labor contracts shall be construed in favor of the safety and decent living for the laborer.

Question 24

Olympia Housing, Inc. vs Allan Lapastora and Irene Ubalubao GR No. 187691

Answer 24

That there is an existing contract of services between OHI and Fast Manpower where both parties acknowledged the latter as the employer of the housekeeping staff, including Lapastora, did not alter established facts proving the contrary. The parties cannot evade the application of labor laws by mere expedient of a contract considering that labor and employment are matters imbued with public interest. It cannot be subjected to the agreement of the parties but rather on existing laws designed specifically for the protection of labor. Thus, it had been repeatedly stressed in a number of jurisprudence that “[a] party cannot dictate, by the mere expedient of a unilateral declaration in a contract, the character of its business, i.e., whether as labor-only contractor or as a job contractor, it being crucial that its character be measured in terms of and determined by the criteria set by statute.”

Question 25

What is the definition of a “Collective Bargaining Agreement”?

Answer 25

IRR. Book V, Rule 1, Sec. 1. (j). “Collective Bargaining Agreement” or “CBA” refers to the contract between a legitimate labor union and the employer concerning wages, hours of work, and all other terms and conditions of employment in a bargaining unit.

Question 26

What is a “Bargaining Unit”?

Answer 26

IRR. Book V. Rule 1. Sec. 1. (d). “Bargaining Unit” refers to a group of employees sharing mutual interests within a given employer unit, comprised of all or less than all of the entire body of employees in the employer unit or any specific occupational or geographical grouping within such employer unit.

Question 27

American Wire and Cable Daily Rated Employees Union vs. American Wire and Cable Co., Inc GR No. 155059

Answer 27

“For a bonus to be enforceable, it must have been promised by the employer and expressly agreed upon by the parties, or it must have had a fixed amount and had been a long and regular practice on the part of the employer.” [American Wire and Cable Daily Rated Employees Union vs. American Wire and Cable Co., Inc GR No. 155059]

Question 28

China Banking Corp. vs. Borromeo GR No. 156515

Answer 28

“It is well recognized that company policies and regulations are, unless shown to be grossly oppressive or contrary to law, generally binding and valid on the parties and must be complied with until finally revised or amended unilaterally or preferably through negotiation or by competent authority. Moreover, management has the prerogative to discipline its employees and to impose appropriate penalties on erring workers pursuant.” [China Banking Corp. vs. Borromeo GR No. 156515]

Question 29

What is social justice?

Answer 29

Social justice means the promotion of the welfare of the people, the adoption by the Government of measures calculated to insure economic stability of all the competent elements of society, through the maintenance of a proper economic and social equilibrium in the interrelations of the members of the community, constitutionally, through the adoption of measures legally justifiable, or extra-constitutionally, through the exercise of powers underlying the existence of all governments on the time-honored principle of salus populi est suprema lex. Social justice, therefore, must be founded on the recognition of the necessity of interdependence among divers and diverse units of a society and of the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life, consistent with the fundamental and paramount objective of the state of promoting the health, comfort, and quiet of all persons, and of bringing about “the greatest good to the greatest number.” [Calalang v Williams GR No. 47800]

Question 30

Can the state curtail the right to security of tenure?

Answer 30

Yes. In St. Luke’s Medical Center Employee’s Association vs. NLRC, it was held: “While the right of workers to security of tenure is guaranteed by the Constitution, its exercise may be reasonably regulated pursuant to the police power of the State to safeguard health, morals, peace, education, order, safety, and the general welfare of the people. Consequently, persons who desire to engage in the learned professions requiring scientific or technical knowledge may be required to take an examination as a prerequisite to engaging in their chosen careers.” [St. Luke’s Medical Center Employee’s Association vs. NLRC GR No. 162053].

Question 31

Are there limitations upon the policy of social justice in favor of labor?

Answer 31

Yes. In Toyota Motor Phils. Corp. Workers Association vs. NLRC, the Court held: “The general rule is that when just causes for terminating the services of an employee under Art. 282 of the Labor Code exist, the employee is not entitled to separation pay. The apparent reason behind the forfeiture of the right to termination pay is that lawbreakers should not benefit from their illegal acts.” [TMPCWA vs. NLRC GR. No. 158798-99]

Question 32

What is management prerogative?

Answer 32

As explained in the case of Industrial & Transport Equipment, Inc. vs. Tugade, management prerogative is “the right of an employer to regulate all aspects of employment […]. [This] gives employers the freedom to regulate, according to their discretion and best judgment, all aspect of employment, including work assignment, working methods, processes to be followed, working regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal and recall of workers.” [Industrial & Transport Equipment Inc. v. Tugade GR No. 158539]

Question 33

Does management have the right to discipline its employees?

Answer 33

Yes, management has the right to discipline its employees. In Industrial & Transport Equipment Inc vs Tugade: “In general, management has the prerogative to discipline its employees and to impose appropriate penalties on erring workers pursuant to company rules and regulations.”

Question 34

Does management have the right to transfer employees?

Answer 34

Yes. In Echo 2000, the Court cited Art. 212 (13) of the Labor Code: “’Managerial employee’ is one who is vested the powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline employees.”

The Court also cited Coca-Cola Bottlers Philippines v. Del Villar: “In pursuit of legitimate business interest, management has the prerogative to transfer or assign employees fromm one office or area of operation to another – provided there is no demotion of rank or diminution of salary, benefits, and other privileges; and the action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause.” [Echo 2000 Commercial Corporation, et al. vs. Obrero Filipino-Echo 2000 Chapter-CLO et al.]

Question 35

What is a “bonus”?

Answer 35

By definition, a “bonus” is a gratuity or act of liberality of the giver. It is something given in addition to what is ordinarily received by or strictly due the recipient. [Protacio v. Laya Mananghaya & Co. GR No. 168654]

Question 36

When is a bonus granted?

Answer 36

A bonus is granted and paid to an employee for his industry and loyalty which contributed to the success of the employer’s business and made possible the realization of profits.

[…] The granting of a bonus is basically a management prerogative which cannot be forced upon the employer who may not be obliged to assume the onerous burden of granting bonuses or other benefits aside from the employees’ basic salaries or wages.

[Protacio v. Laya Mananghaya GR No. 168654]

Question 37

Is a bonus a demandable and enforceable obligation?

Answer 37

Generally, no. Exception: It is demandable when it is made part of the wage or salary compensation.

When considered as part of the compensation and therefore demandable and enforceable, the amount is usually fixed. If the amount would be a contingent one dependent upon the realization of the profits, the bonus is also not demandable and enforceable. [Protacio v. Laya Mananghaya GR No. 168654]

Question 38

Does management have the right to change the working hours of its employees?

Answer 38

Yes. In Union Carbide Labor Union vs. Union Carbide Phils Inc., the Court held that “Verily and wisely, management retained the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. As long as such prerogative is exercised in good faith for the advancement of the employer’s interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold such exercise.”

Question 39

Are post-employment restrictions valid?

Answer 39

Yes. In Ollendorf vs. Abrahamson, the Court held: “A contract by which an employee agrees to refrain for a given length of time after the expiration of the term of his employment, from engaging in a business competitive with that of his employer is not void as being restraint of trade, if the restraint is no greater than that which is necessary to afford a reasonable protection to the employer.” [Ollendorf v. Abrahamson GR No. 13228]

Question 40

What should the trial courts consider in determining whether the contract is reasonable or not?

Answer 40

In determining whether the contract is reasonable or not, the trial court should consider the following factors: (a) whether the covenant protects a legitimate business interest of the employer; (b) whether the covenant creates an undue burden on the employee; (c) whether the covenant is injurious to the public welfare; (d) whether the time and territorial limitations contained in the covenant are reasonable; and (e) whether the restraint is reasonable from the standpoint of public policy. [Rivera v. Solidbank GR No. 163269]

Question 41

When are non-involvement clauses (restraint of trade) considered valid based on the case of Tiu vs. Platinum Plans Phil. Inc.?

Answer 41

In Tiu, the Court held: “a non-involvement clause is not necessarily void for being in restraint of trade as long as there are reasonable limitations as to time, trade, and place.” [Tiu vs. Platinum Plans Phil., Inc. GR No. 163512].

Question 42

Can an employer dismiss employees when the latter’s service will be inimical to the former’s interests?

Answer 42

Yes. In Agabon v. NLRC, the Court held: “The law imposes many obligations on the employer such as providing just compensation to workers, observance of the procedural requirements of notice and hearing in the termination of employment. On the other hand, the law also recognizes the right of the employer to expect from its workers not only good performance, adequate work and diligence, but also good conduct and loyalty. The employer may not be compelled to continue to employ such persons whose continuance in the service will patently be inimical to his interests.” [Agabon v. NLRC GR No. 158693]

Question 43

What is the presumption regarding employees of the same position and rank?

Answer 43

“If an employer accords employees the same position and rank, the presumption is that these employees perform equal work. Hence, the doctrine of ‘equal pay for equal work’ in International School Alliance of Educators [applies].” [Philex Gold Philippines, Inc., et al., vs. Philex Bulawan SUpervisors Union GR No. 149758].

Question 44

What is R.A. 10911?

Answer 44

R.A. 10911 is the Anti-Age Discrimination in Employment Act

Question 45

What are the prohibited acts under R.A. 10911 (Anti-Age Discrimination in Employment Act)?

Answer 45

Section 5. Prohibition of Discrimination in Employment on Account of Age -

(a) It shall be unlawful for an employer to:

• (1) Print or publish, or cause to be printed or published, in any form of media, including the internet, any notice of advertisement relating to employment suggesting preferences, limitations, specifications, and discrimination based on age;
• (2) Require the declaration of age or birth date during the application process;
• (3) Decline any employment application because of the individual’s age;
• (4) Discriminate against an individual in terms of compensation, terms and conditions or privileges of employment on account of such individual’s age;
• (5) Deny any employee’s or worker’s promotion or opportunity for training because of age;
• (6) Forcibly lay off an employee or worker because of old age; or
• (7) Impose early retirement on the basis of such employee’s or worker’s age.

(b) It shall be unlawful for a labor contractor or subcontractor, if any, to refuse to refer for employment or otherwise discriminate against any individual because of such person’s age.
(c) It shall be unlawful for a labor organization to:

• (1) Deny membership to any individual because of such individual’s age;
• (2) Exclude from its membership any individual because of such individual’s age; or
• (3) Cause or attempt to cause an employer to discriminate against an individual in violation of this Act.

(d) It shall be unlawful for a publisher to print or publish any notice of advertisement relating to employment suggesting preferences, limitations, specifications, and discrimination based on age.

Question 46

Labor Code Article 4.

Answer 46

Labor Code. Art. 4. Construction in Favor of Labor. – All doubts in the implementation and interpretation of the provision of this Code, including its implementing rules and regulations, shall be resolved in favor of labor.

Question 47

NCC. Art. 1702.

Answer 47

NCC. Art. 1702. In case of doubt, all labor legislation and all labor contracts shall be construed in favor of the safety and decent living for the laborer.

Question 48

Is construction in favor of labor also applied to evidence presented before quasi-judicial and judicial bodies?

Answer 48

Yes. In Hocheng vs. Farrales, the Court held “[W]here there is no showing of a clear, valid and legal cause for termination of employment, the law considers the case a matter of illegal dismissal. If doubts exist between the evidence presented by the employer and that of the employee, the scales of justice must be titled in favor of the latter. The employer must affirmatively show rationally adequate evidence that the dismissal was for a justifiable cause.” [Hocheng Philippines Corporation vs. Antonio M. Farrales GR No. 211497]

Question 49

Who has the burden of proof in proving that the termination is for a just and valid cause?

Answer 49

In Penaflor v. Outdoor Clothing, the Court held: “[I]n employee termination disputes, the employer bears the burden of proving that the employee’s dismissal was for just and valid cause.” [Penaflor vs. Outdoor Clothing Manufacturing Corp. GR No. 177114].

Question 50

Who has the burden of proof in proving that the termination is for a just and valid cause?

Answer 50

In Penaflor v. Outdoor Clothing, the Court held: “[I]n employee termination disputes, the employer bears the burden of proving that the employee’s dismissal was for just and valid cause.” [Penaflor vs. Outdoor Clothing Manufacturing Corp. GR No. 177114].