Labor Law: Rights, Duties, and Sources

• Labor is the exertion of physical or mental effort toward producing goods and services.

Labor Law

• Governs the rights and duties of employers and employees, including employment terms, conditions, and labor disputes from collective bargaining.

Sources of Labor Law

• Constitution
• Labor Code and related legislation
• Contracts
• Collective Bargaining Agreements (CBAs)
• Company practices and policies

Constitutional Provisions

• Article II outlines principles and state policies.
• Section 9 mandates the State to promote social order for national prosperity, poverty alleviation, adequate social services, full employment, rising living standards, and improved quality of life.
• Section 10 requires the State to promote social justice in national development.
• Section 14 recognizes women's role in nation-building, ensuring gender equality before the law.
• Section 18 affirms labor as a primary socioeconomic force, protecting workers' rights and welfare.
• Section 20 acknowledges the private sector's role, encouraging private enterprise and investments.
• Article III (Bill of Rights) has relevant sections.
• Section 1 protects individuals from deprivation of life, liberty, or property without due process and guarantees equal protection.
• Section 4 ensures freedom of speech, expression, and the right to peaceful assembly and petition for grievances.
• Section 8 protects the right to form unions and associations for lawful purposes, applicable to public and private sectors.
• Section 10 prohibits laws impairing contract obligations.
• Section 16 guarantees the right to a speedy disposition of cases in all judicial, quasi-judicial, and administrative bodies.
• Section 18(2) prohibits involuntary servitude except as punishment for a crime with due conviction.
• Article XIII covers social justice and human rights.
• Section 2 includes promoting social justice through economic opportunities based on initiative and self-reliance.
• Section 3 mandates the State to fully protect local and overseas labor (organized and unorganized) and promote full employment and equality. It guarantees workers' rights to self-organization, collective bargaining, peaceful activities (including strikes), security of tenure, humane conditions, and a living wage, as well as participation in policy-making. The State promotes shared responsibility between workers and employers, voluntary dispute resolution, and enforces mutual compliance for industrial peace. It regulates relations, acknowledging labor's share in production fruits and enterprises' right to returns, expansion, and growth.
• Section 13 requires the State to establish an agency for disabled persons for rehabilitation, self-development, self-reliance, and societal integration.
• Section 14 directs the State to protect working women with safe working conditions, considering maternal functions.

Basic Workers' Rights (Constitution)

• Security of tenure
• Living wage
• Share in production fruits
• Just and humane working conditions
• Self-organization
• Collective bargaining and negotiations
• Peaceful concerted activities, including the right to strike
• Participation in policy and decision-making.

Labor Laws and the Civil Code

• Article 19: Exercise rights and perform duties with justice, give everyone their due, and observe honesty and good faith.
• Article 1700: Relations between capital and labor are impressed with public interest, so labor contracts yield to the common good and are subject to labor laws on unions, bargaining, strikes, wages, working conditions, and hours.
• Article 1701: Neither capital nor labor should act oppressively or impair public interest/convenience.
• Article 1702: All labor legislation and contracts are construed in favor of safety and decent living for laborers when in doubt.
• Article 1703: Contracts amounting to involuntary servitude are invalid.
• Article 1704: Labor union/committee members signing a collective bargaining agreement are liable for nonfulfillment.
• Article 1708: Laborers' wages are exempt from execution/attachment except for debts related to food, shelter, clothing, and medical needs.
• Article 1709: Employers cannot seize/retain tools or articles belonging to the laborer.
• Article 1710: Dismissal of laborers is subject to Government supervision under special laws.

Classifications of Labor Laws

• Labor standards are minimum requirements for employment conditions (wages, hours, cost-of-living, benefits, safety, and health).
• Labor Relations defines and regulates the status, rights, duties, and mechanisms governing interactions between employers, employees, and representatives.

Social Legislation

• Laws promote public welfare and provide specific protection/benefits to society, enhancing welfare, including statutes without employer-employee relationships.

Construction in Favor of Labor

• Implementation/interpretation doubts of the Labor Code are resolved in favor of labor, including implementing rules/regulations. All labor legislation/contracts are construed in favor of safety and decent living for laborers if there's doubt (Art. 1702, New Civil Code).
• In employment contracts, interpretation favors labor.
• For Collective Bargaining Agreements (CBAs), the intention is to put employees on equal footing.

Protection to Labor

• Law must balance the heavier influence of capital with sympathy and compassion for the underprivileged worker, aligning with the Labor Code and the principle that those with less in life should have more in law. Doubts in controversies between laborers and masters should be resolved in the former's favor, extending benefits under the law, giving maximum aid and protection.

Compassionate Justice

• Social justice policy mandates compassionate attitude towards the working class. The Constitution doesn't condone employee wrongdoing but urges moderation of sanctions. Rigid rules should be disregarded, and due weight should be given to all equities. Labor should be protected to the extent of raising them to equal footing in bargaining relations with capital and to shield them from abuses.

Burden of Proof and Quantum of Evidence

• The burden of proof shifts between employer and employee based on the monetary claim sought.
• The employer bears the burden for salary differential, service incentive leave, holiday pay, and 13th-month pay claims because records are in their custody
• However, employees bear the burden for overtime and premium pay claims for holidays and rest days.
• The employee must first prove dismissal in illegal dismissal cases before the employer proves it was legal.
• In legal/labor cases, substantial evidence is required

Limitations and rights

• Recognition of management rights: Management has rights entitled to respect and enforcement in the interest of fair play.
• Principle of non-oppression: Neither capital nor labor shall act oppressively against the other or impair public interest/convenience (Art. 1701, NCC).

Limitations to Protection of Labor

• Protection is not designed to oppress or destroy capital, nor authorizes oppression or self-destruction of the employer. Justice should not be denied to either party.

Rights of Management

• Management has rights entitled to respect and enforcement in fair play, to be protected equally by the Secretary of Labor.

Fundamental Management Rights (S-P-I-T)

• Select employees
• Prescribe rules
• Reasonable return on Investments
• Transfer or discharge employees
• Management can regulate all employment aspects (work assignment, methods, place, manner of work)

Restrictions to Management Rights

• Management rights are not absolute and are subject to the State's duty to promote distributive justice and intervene for the common good.

Management rights are subject to limitations from:

• Law
• Contract (individual or collective)
• General principles of fair play and justice

Labor Code

• Presidential Decree (PD) No. 442, known as the Labor Code of the Philippines, institutes a Labor Code to revise and consolidate labor and social laws and protect workers, promote employment/human resources development, and ensure industrial peace.
• Signed into law on May 1, 1974, effective on November 1, 1974.

Declaration of Basic Policy

The State shall:

• Afford full protection to labor
• Promote full employment
• Ensure equal work opportunities regardless of sex, race, or creed
• Regulate relations between workers and employers
• Assure workers' rights to self-organization, collective bargaining, security of tenure, and just conditions (Art. 3, LC)

Rule-Making Power Granted by the Labor Code

• The Department of Labor and Employment (DOLE), through the Secretary of Labor and Employment (SOLE) and other Government agencies, can promulgate necessary implementing rules and regulations (IRRs) for the Labor Code (Art. 5, LC).

Limitations

The Rule-Making Power must:

• Be issued under legal authority
• Not contradict law or the Constitution
• Not exceed the law itself
• Rules exceeding this power are void.

Applicability of Labor Code

• General Rule: All rights and benefits apply equally to agricultural and non-agricultural workers (Art. 6, LC)

Exceptions

The code does not apply to:

• Government employees
• Employees of government-owned/controlled corporations created by special/original charter
• Foreign governments
• International agencies (aggrieved employees can file a complaint before the Department of Foreign Affairs (DFA))
• Corporate officers/intra-corporate disputes under PD 902-A (now under regular courts)
• Local water districts when NLRC jurisdiction is not invoked
• Cases otherwise provided by the LC