LMGLABR (Atty. Tito Bundang) (PDF)

LMGLABR (Atty. Tito Bundang) Chapter 1. General Principles of the Labor Code TF 11:00 AM-12:30 PM A. Article 1 (Name of Decree) Introduction to the Course - decree shall be known as the “Labor C...

LMGLABR (Atty. Tito Bundang) Chapter 1. General Principles of the Labor Code TF 11:00 AM-12:30 PM A. Article 1 (Name of Decree) Introduction to the Course - decree shall be known as the “Labor Code of the Philippines” Labor - employment (consideration, wages, incentives) B. Article 2 (Date of Effectivity) - workforce, manpower - code shall take effect six (6) months after its - people (responsibilities, rights) promulgation Economics C. Article 5 (Rules and Regulations) - management of resources available to man - the Department of Labor and other government - there is production of resources (creating more) agencies charged with the administration and - distribute what we have made enforcement of this Code or any of its part shall - consumption of resources promulgate the necessary implementing rules and regulations Factors of Production - such rules and regulations shall become effective 1. Labor (Workers) 15 days after announcement of their adoption in - doing, thinking, and creating more goods/services Newspapers of General Circulation 2. Capital (Capitalists) Presidential Decree No. 442 (“P.D. 442”) - tools, capital, machine to produce labor - a decree instituting the Labor Code and - instruments to produce more Consolidating Labor and Social Laws to Afford Protection to Labor 3. Land - promote employment and human resources - natural resources for goods/services development and insure industrial peace based on social justice 4. Entrepreneurship - otherwise known as the “Labor Code of the - methods/approaches by people Philippines”, promulgated on May 1, 1974 - took effect 6 months from its promulgation (Nov. Industrialization Era 1, 1974) - started in England - Mid 1700s-Mid 1800s Department of Labor and Employment (“DOLE”) - where labor issues started and other government agencies charged with - things became mechanized the administration and enforcement of the Labor - mass production Code - shall promulgate the necessary implementing Government rules and regulations - creates labor laws - shall become effective 15 days after publication in newspapers of general circulation Labor Laws - based on the Principle of Social Justice I. Maximum Aid and Protection to Labor Minimum Wage - in NCR, it is Php 570 A. Article 3 (Declaration of Basic Policy) - the State shall afford protection to Labor, promote Heavy Industrialization full employment, ensure equal work opportunities - steel and heavy industry regardless of sex, race or creed and regulate the - to make machines that will make more machines relations between workers and employers - the State shall assure the rights of workers to self- OFWs and BPO organization, collective bargaining, security of - keeps the Philippines’ economy afloat tenure, and just and humane conditions of work Ledesma Labor Code regulations, shall be resolved in favor of - social legislation primarily intended to help the labor) employees in conformity with the social justice - the mandate of the law is that all doubts in the guarantee of the Constitution implementation and interpretation of the - policy of the state to give maximum aid and provisions of the Labor Code and its protection to labor is embodied in Article 3 Implementing Rules and Regulations should be resolved in favor of labor Extension of Applicability of Law to Protect - under the policy of Social Justice, the law bends Labor over backwards to accommodate the interests of - stipulations in an employment contract not the working class on the humane justification that contrary to statutes, public policy, public order of those with less privileges in life should have more morals have the force of law between the privileges in law contracting parties - when conflicting interests of labor and capital are - in controversies between a laborer and his weighed on the scales of social justice, the master, doubts reasonably arising from the heavier influence of the employer should be evidence, or in the interpretation of agreements counter-balanced by the law, which must accord should be resolved in favor of labor sympathy and compassion to the underprivileged - the policy is to extend the rule to a greater employee number of employees who can avail of the - any doubt concerning the rights of labor should be benefits under the law, in consonance with the resolved in favor of labor, pursuant to the social avowed policy of the State to give maximum aid justice policy and protection to labor B. Where the Law is clear, the law is to be Protection of Labor Not Meant as a Sword to applied to the facts of the case Oppress Employers - the doctrine of liberal construction cannot be - while the Constitution is committed to the policy of applied where the law invoked is clear, social justice and the protection of the working unequivocal and leaves no room for construction class, it should not be supposed that every - where the law is clear, it should be applied to the dispute will be automatically decided in favor of facts of the case labor - otherwise, it will contravene the purpose for which - the employer also has rights, which are entitled to the law was enacted, and will defeat the ends respect and enforcement in the interest of simple which it seeks to attain fair play - although the Supreme Court has been more often Doctrine of Liberal Interpretation inclined toward the employee and has upheld his - cannot be applied if it would render useless the cause in his conflicts with the employer, such very purpose for which it was adopted favoritism has not blinded the Supreme Court to - to disregard the employer’s own rights and rule that justice is in every case for the deserving, interests solely on the basis of concern and to be dispensed in the light of established facts solicitude for labor, is unjust and unacceptable and the applicable law and doctrine - justice is not fully served by sustaining the - the Constitutional policy to provide full protection contention of the poor because he is poor to labor is not meant to be a sword to oppress - justice is done by properly applying the law, employers regardless of the station in life of the contending - the commitment of the Court to the cause of labor parties does not prevent the Court from sustaining the employer when it is in the right III. Principle of Non-Diminution of Benefits II. A liberal interpretation of the Labor Code A. Article 100 (Prohibition against Elimination or and its implementing rules Diminution of Benefits. Nothing in this book shall be construed to eliminate or in any way When Liberal Interpretation is allowed diminish supplements, or other employee benefits being enjoyed at the time of A. Article 4 (Construction in favor of labor. All promulgation of this Code) doubts in the implementation and interpretation of the provisions of this Code, including its implementing rules and Ledesma Principle of Non-Diminution of Benefits B. Indicators that Benefits have ripened into - prohibits the elimination of supplements or other company practice benefits already enjoyed by the employees under - the employee must prove by substantial evidence existing laws, decrees, executive orders, that the giving of the benefit is done over a long company policy or practice, or any agreement or period of time, and that is has been made contract between the employer and employees consistently and deliberately - employees have a vested right over existing - benefit must be characterized by regularity benefits voluntarily granted to them by their - while jurisprudence has not laid down any hard employer and fast tule as to the length of time that company - any benefit/supplement being enjoyed by the practice should have been exercised in order to employees cannot be reduced, diminished, constitute voluntary employer practice, the discontinued or eliminated common denominator appears to be the regularity - is founded on the Constitutional mandate to and deliberateness of the grant of benefits over a protect the rights of workers, to promote their significant period of time welfare, and to afford them full protection - requires an indubitable showing that the employer - basis of Article 4 (“All doubts in the agreed to continue giving the benefit knowing fully implementation and interpretation if this Code, well that the employees are not covered by any including its implementing rules and regulations, provision of the law or agreement requiring shall be rendered in favor of labor”) payment thereof Meaning of Supplements or Benefits In order that benefits may be deemed to have - constitute extra remuneration ripened into company practice, these are the - special privileges given to or received by following indicators: employees over and above their ordinary (1) The employer’s knowledge that he is not earnings required to extend such benefit to his employees - include but are not restricted to: (2) The granting of the benefits is consistent and (1) pay for vacation and special holidays not worked deliberate (2) paid sick leave (3) The employer continues to grant his employees (3) overtime rate in excess of what is required by the benefit for several years law - the considerable length of time that benefits have (4) profit-sharing been granted by the employer to the employees (5) family allowances indicates a unilateral and voluntary act on his (6) Christmas and cost-of-living bonuses part, sufficient in itself to negate any claim of (7) bonuses other than those paid as a reward for mistake extra output or time spent on the job (8) funeral or bereavement aid C. Requisites for Diminution of Benefits (9) any other benefit stipulated in a CBA (1) The benefit is founded on a policy or has ripened into a practice over a long period of time Collective Bargaining Agreement (CBA) (2) The practice is consistent and deliberate - negotiated contract between a legitimate labor (3) The practice is not due to error in the organization and the employer concerning wages, construction or application of a doubtful or hours of work and all other terms and conditions difficult question of law of employment in a bargaining unit (4) The diminution or discontinuance is done - parties in a CBA may establish such stipulations, unilaterally by the employer clauses, terms and conditions they deem convenient, provided these are not contrary to Principle against Diminution of Benefits law, morals, good customs, public order or public - only applicable if the grant/benefit is founded on policy an express policy or has ripened into a practice - where the CBA is clear and unambiguous, it over a long period of time, which is consistent and becomes the law between the parties and deliberate compliance therewith is mandated by the express - presupposes that a company practice, policy and policy of the law tradition favorable to the employees has been - the literal meaning of the stipulations of the CBA, clearly established, and that the payments made as with every other contract, controls if they are by the company pursuant to it have ripened into clear and leave no doubt on the intention of the benefits enjoyed by them contracting parties Ledesma - a practice or custom is not a source of a legally prescribed commensurate to the infraction or demandable or enforceable right offense committed - company practice, habits, customs, usage or patterns of conduct, must be proven by the A. Hiring and Firing of Employees offering party who must allege and establish - it is not without limitation specific, repetitive conduct that might constitute - limitation is embodied in the constitutional evidence of habit or company practice requirement for the protection of labor and the promotion of social justice, which tilts the scales of justice in favor of the employee whenever there IV. Management Prerogatives is doubt - law must also protect the rights of the employer to Dismissal of Employees exercise what are clearly management - certain mandatory requirements laid down by the prerogatives law must be complied with to ensure that this - free will of the employer to conduct his own management prerogative is exercised without business affairs to achieve his purpose arbitrariness or abuse of discretion - the exercise of management prerogative, while - both the reason for dismissal and the manner of ordinarily not interfered with, is not absolute and dismissing an employee must be appropriate is subject to limitations imposed by law, CBAs, - otherwise, the termination itself is gravely and general principles of fair play and justice defective and may be declared unlawful An employer is free to regulate: Employee Job considered as a property right (1) Hiring - within the constitutional mantle of protection that (2) Work assignments “No person shall be deprived of life, liberty or (3) Working methods property without due process of law; nor shall any (4) Time, place and manner of work person be denied the equal protection of the laws (5) Tools to be used (6) Processes to be followed B. Discipline of Employees (7) Supervision of employees - disciplinary action against an erring employee is a (8) Working Regulations management prerogative (9) Transfer of employees - not subject to judicial interference (10) Work supervision - this policy can be justified only if the disciplinary (11) Lay off of employees action is dictated by legitimate business reasons (12) Discipline, dismissal and recall of work and is not oppressive Management Prerogative C. Transfer of Personnel - based on the established rule that the law does - employer’s prerogative, based on his assessment not authorize the substitution of the judgment of of his employees’ qualifications, aptitudes and the employer in the conduct of his business competence - employer’s right to conduct the affairs of its - move the employees around in the various areas business according to its own discretion and of his business operations so that they will judgment in order to achieve its purpose, is well function with maximum benefit to the company recognized - an employee’s right to security of tenure does not - may be availed of without fear of any liability so give him such a vested right in his position as long as the following conditions are met: would deprive the employer of his prerogative to (1) it is exercised in good faith for the advancement change his assignment or transfer him where he of the employer’s interest and not for the will be most useful purpose of defeating or circumventing the rights of employees under special laws or a valid When his transfer is not reasonable, agreement inconvenient, or prejudicial, and if it does not (2) it is not exercised in a malicious, harsh, involve a demotion in rank or diminution of his oppressive, vindictive or wanton manner or out salaries, benefits and other privileges of malice or spite - the employee may not complain that the transfer amounts to a constructive dismissal Policies, rules and regulations on work-related activities of the employees must always be fair and reasonable, and the corresponding penalties Ledesma Prerogative to transfer personnel work, processes to be followed, supervision of - must be exercised without grave abuse of workers, working regulations, transfer of discretion, but by putting to mind the basic employees, work supervision, lay off of workers elements of justice and fair play and discipline, dismissal and recall of workers - having the right should not be confused with the - management retains the prerogative, whenever manner in which the right must be exercised exigencies of the service so require, to change - the transfer of employees cannot be used as the working hours of its employees subterfuge by the employer to rid himself of an - this exercise is not absolute undesirable employee or to penalize an employee - must be exercised in good faith and with due for his union activities and thereby defeat his right regard to the rights of labor (with the principles of to self-organization fair play at heart and justice in mind) An employer may: G. Rules on Marriage - transfer/assign employees from one office or area 1. Prohibition on Marriage to Employees of of operation to another, provided there is no Competitor Companies demotion in rank or diminution of salary, benefits - relationships of this nature might compromise the and other privileges, and the action is not interests of the company motivated by discrimination, made in bad faith, or - employer has the right to guard its trade secrets, effected as a form of punishment/demotion manufacturing formulas, marketing strategies and without sufficient cause other confidential programs and information from - having the right should not be confused with the competitors manner in which the right is exercised - may issue a company policy prohibiting marriage with employees of competitor companies D. Productivity Standards - protect its interests against the possibility that a - the company policy of laying off workers because competitor company will gain access to its secrets they failed to make the work quota has been and procedures recognized - the Supreme Court has ruled that failure to meet 2. Prohibition on Marriage to Co-Employees (No- the work quota assigned to an employee (either spouse Employment Policy) by failing to complete it within the allotted - whether this policy violates the rights of the reasonable period, or by producing unsatisfactory employee under the Constitution and the Labor results) constitutes a just cause of his dismissal, Code, and is a valid exercise of management regardless of the permanent or probationary prerogative, depends on the reasonableness of status of his employment the business necessity - this management prerogative of requiring standards may be availed of so long as it is exercised in good faith to advance the employer’s interest E. Granting of Bonus - depending on its past performance, at specific times of the year - bonuses are not part of labor standards in the same class as salaries, cost-of-living allowance (“COLA”), holiday pay, and leave benefits, which are provided by the Labor Code - decrease in the midyear and year-end bonuses, or even outright elimination, would not constitute a diminution of the employees’ salaries, as the granting of bonuses is entirely a management prerogative F. Change of Working Hours - within management rights to regulate, according to its own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of Ledesma  Chapter 2. Employment Relationship v. 2. The Relationship between Jeepney Owners/ Independent Contractorship Operators and Jeepney Drivers under the Boundary System Is That Of Employer-Employee and Not of Lessor-Lessee I. When an employment relationship is - the fact that drivers do not receive fixed wages present but only get the amount in excess of the so-called “boundary” that they pay to the owner/operator is Employee not sufficient to negate the relationship between - person who performs services for an employer in them as employer and employee which either or both mental and physical efforts are used C. An Express Provision in the Contract That An - receives compensation for such services, where Employee Is An Independent Contractor Cannot there is an employer-employee relationship Negate An Employment Relationship - the existence of an employer-employee relation A. The Fourfold Test ship cannot be negated by expressly repudiating 1. Selection and engagement of the employee it in the contract and stipulating that the employee 2. Payment of Wages is an independent contractor, when the terms of 3. Power of Dismissal the contract clearly indicate that the relationship is 4. Power to Control the Employee’s Conduct in reality one of employment - the employment status of a person is defined and B. The Right-of-Control Test prescribed by law, and not by what the parties say - power to control the employee’s conduct it is - where the person for whom the services are - in determining the status of a contract. the performed reserves a right to control not only the fourfold test of employment, specifically the right- ends to be achieved but also the means to be of-control test, has to be applied used in reaching such end - generally assumes primacy in the overall D. Evidence to Prove Existence of Employer- consideration of whether an employer-employee Employee Relationship relationship exists between the parties - Although no particular form of evidence is required to prove the existence of the employer- If the power to control the employee’s conduct is employee relationship, and any competent and absent, no employment relationship may be relevant evidence to prove the relationship may considered as existing between the parties. be admitted, a finding that the relationship exists must nonetheless rest on substantial evidence Power to control the employee’s conduct - well-entrenched is the doctrine that the existence - deemed to be very important that the other of an employer-employee relationship is ultimately requirements (selection and engagement of a question of fact and that the findings thereon by employee, payment of wages and power of in Labor Arbiter and NLRC shall be accorded not dismissal) may even be disregarded only respect but even finality when Supported by substantial evidence 1. Sufficiency of the Mere Existence of the Power to Control II. No Employment Relationship: - existence of the power to control the employee’s Independent Contractorship conduct and not to the actual exercise of that power - not essential for the employer to supervise the Independent Contractor performance of duties of the employees - one who has contracted to do the work according - enough that the employer has the right to wield to his own methods and without being subject to that power, in order than an employer-employee the control of the employer, except as to the result relationship may be considered as existing of the work between the parties A. Test of An Independent Contractorship - each case must be determined on its own facts and all the features of the relationship considered Ledesma Significant factor in determining the relationship relations between the insurer and the insured, of the parties and the internal affairs of the insurance company - presence/Absence of a supervisory power to control the method and detail of performance of Insurance Business the service, and the degree to which the person - rules and regulations governing the conduct of for whom the services are performed may business are provided for in the Insurance Code intervene to exercise such control and are enforced by the Insurance Commissioner - expected for an insurance company to Indicative of an Employment Relationship promulgate a set of rules to guide its commission - presence of the power of control agents in selling its policies so that they will not violate the law Indicative of an Independent Contractorship - absence of such power Guidelines to achieve the desired results: - where the principal is interested only in the end to (1) Rules which prescribe the qualifications of be achieved or the results of the work persons who may be insured; (2) Subjecting insurance applications to processing Employer-Employee Relationship and approval by the company; - where the person for whom the services are (3) Reserving to the company the determination of performed, or the principal, reserves the right to the premiums to be paid and the schedules of control both the end to be achieved and the payment manner and means to be used in reaching the end - no control is present above for as long as the agent’s contractual prerogative to adopt his own B. Not Every Form Of Control Will Establish An selling methods or to sell insurance at his own Employment Relationship time and convenience is not invaded - principal may establish guidelines to be followed by the person whose services are engaged 2. The Dealer Is An Independent Contractor - not every form of control that the principal reserves to himself over the conduct of the person Independent Contractor engaged may be accorded the effect of - a person engaged to sell soft drinks for the establishing an employer-employee relationship principal, using a truck supplied by the principal between them - but with the right to employ his own workers - it would be a rare contract of service that gives - to sell according to his own methods, subject only untrammeled freedom to the person whose to prearranged routes, observing no working services are engaged and eschews any hours fixed by the principal intervention whatsoever in his performance of the - obliged to secure his own licenses work - defray his own selling expenses, all in consideration of a peddler's discount given by the 1. There is No Control When Guidelines Do Not principal for at least 250 cases of soft drinks sold Dictate the Methods to Achieve the Desired daily Results - a line should be drawn between rules that merely III. Job Contracting and Subcontracting serve as guidelines towards the achievement of mutually desired results without dictating the means or methods to be employed in attaining it, A. Contracting or Subcontracting under the and rules that control or fix the methodology and Labor Code bind or restrict the party hired to the use of such - Articles 106-109 of the Labor Code governs the means relationship between contractors, subcontractors - the first, which aims only to promote the result, and contractual employees creates no employer-employee relationship - the second, which addresses both result and the Article 106 (Contractor or Subcontractor) means to achieve it - whenever an employer enters into a contract with - acquires particular relevance in the case of an another person for the performance of the enterprise that affects public interest, such as the former’s work, the employees of the contractor business of insurance, which is subject to and of the latter’s subcontractor, if any, shall be regulation by the State with respect to the paid in accordance with the provisions of this Code Ledesma  Article 107 (Indirect Employer) - should have provisions on the Net Financial - the provisions of the immediately preceding article Contracting Capacity of the contractor (must be shall likewise apply to any person, partnership, equal to the total cost) association or corporation which, not being an - must also contain a provision on the issuance of a employer, contracts with an independent bond renewable every year contractor for the performance of any work, task, - must conform to the DOLE Standard Computation job or project and Standard Service Agreement Article 108 (Posting of Bond) Contract of Employment - an employer or indirect employer may require the - between the contractors and its workers contractor or subcontractor to furnish a bond equal to the cost of labor under contract, on Net Financial Contracting Capacity condition that the bond will answer for the wages - formula to determine the financial capacity of the due the employees should the contractor or contractor to carry out the job, work or services subcontractor, as the case may be, fail to pay the under the Service Agreement same Substantial Capacity Article 109 (Solidary Liability) - paid-up capital stocks of at least Php 3M in the - the provisions of existing laws to the contrary case of corporations, partnerships and notwithstanding, every employer or indirect cooperatives employer shall be held responsible with his - for Single Proprietorships: net worth of at least contractor or subcontractor for any violation of Php 3M any provision of this Code - for purposes of determining the extent of their civil Bond liability under this Chapter, they shall be - bond under Article 108 of the Labor Code that the considered as direct employers principal may require from the contractor to be posted equal to the cost of labor under the B. Contracting or Subcontracting Arrangement contract under DO 18-A - the bond may also refer to the security or guarantee posted by the principal for the payment 1. DEFINITIONS of services of the contractors under the Service Contracting or Subcontracting Agreement - arrangement whereby a principal agrees to put out or farm out with a contractor the performance 2. Legitimate Contracting or Subcontracting or completion of a specific job, work or service under DO 18-A within a definite or predetermined period, regardless of whether such job, work or service is Requisites: to be performed or completed within or outside (1) The contractor must be registered in accordance the premises of the principal with DO 18-A, and carries on a distinct and independent business, and undertakes to Trilateral Relationship in Contracting perform the job. work or service on his own Agreements responsibility, according to his own manner and 1. Principal (farm outs a job, work or service to a method, and free from the control and direction contractor) of his principal in all matters connected with the 2. Contractor (has the capacity to independently performance of the work. except as to the results undertake the performance of the job, work or of the work. service (2) The contractor has substantial capital and/or 3. Contractual workers (engaged by the contractor investment. to accomplish the job, work or service) (3) The Service Agreement ensures compliance with all the rights and benefits of the contractor’s Service Agreement employees under Labor Laws - contract between the principal and the contractor containing the terms and conditions governing the performance or completion of a specific job, work or service being farmed out for a definite or predetermined period Ledesma 3. Registration Requirements 5. Labor-Only Contracting under DO 18-A (1) A certified true copy of a certificate of registration of Arm or business name from the Labor-Only Contracting Securities and Exchange Commission (SEC. - contractor does not have substantial capital or Department of Trade and Industry (DTI). investments in the form of tools, equipment. Cooperative Development Authority (DA) or machineries. work premises from DOLE if the applicant is a labor - the employees recruited and placed with the organization. principal are performing activities which are (2) A certified true copy of the license or business usually necessary or desirable to the operation of permit issued by the local government unit the company or directly related to the main where the contractor operates. business of the principal with a definite or (3) A certified listing, with proof of ownership or predetermined period, regardless of whether such lease contract. of facilities, tools, equipment. job, work or service is to be performed or premises, implements, machineries and work completed within or outside the premises of the premises, that are actually and directly used by principal; or the contractor in the performance or completion - contractor does not exercise the right of control of the job, work or service contracted out, as over the performance of the work of the employee well as a photo of the office building and premises where it holds office. 6. Other Prohibitions under DO 18-A (4) A copy of audited financial statements if the a. Contracting out of jobs, works or services when applicant is a corporation, partnership, not done in good faith and not justified by the cooperative or labor organization or copy of the exigencies of the business latest income tax returns If the applicant is a b. Contracting out of jobs, works or services sole proprietorship. analogous to the above, when not done in good (5) A sworn disclosure that the registrant, its faith and not justified by the exigencies of the officers and owners or principal stockholders, or business any one of them. has not been operating or previously operating as a contractor under a 7. Effects of Finding of Labor-Only Contracting different business name or entity with pending and/or Violation of DO 18-A on Other cases of violations of labor laws. rules and Prohibitions, Rights of Contractor’s Employees, standards, or with a cancelled registration. and Required Contracts (Employment Contract and Service Agreement) If there is a pending case, a copy of the complaint and the latest status of the case shall be attached. - shall render the principal jointly and severally The application shall be verified. It shall include a liable with the contractor to the latter’s employees DOLE certification of attendance to an orientation - principal is liable to the employees directly hired seminar on DO18-A and an undertaking that the by him contractor shall abide by all applicable labor laws and regulations. Solidary Liability - liability of the principal as direct employer together 4. Rights and Benefits of Contractor’s with the contractor, for any violation of the Employees provisions of the Labor Code (1) Safe and healthful working conditions - liability of the principle to his direct employees, to (2) Labor Standards (not limited to service incentive the extent of the work performed under the leave, rest day, overtime pay, holiday pay, 13th contract, when the contractor fails to pay the month pay, and separation pay wages of his employees (3) Retirement benefits under SSS or retirement plans of the contractor C. Distinction between a Job Contractor and A (4) Social security and welfare benefits Labor-Only Contractor (5) Self-organization, collective bargaining and - legitimate job contractor provides services peaceful concerted activities - labor-only contractor (prohibited by law) provides (6) Security of tenure manpower only Legitimate Job Contractor - performs a specific job for the principal Ledesma - provides services as it carries on an independent - for as long as the work, task, job or project has business and has substantial capital or been performed for the principal’s benefit, the investment liability accrues for such period even if the - the personnel recruited and placed by the contractual employees are eventually transferred contractor with the principal do not perform or reassigned elsewhere by the contractor activities related to the main business of the principal Principal’s liability to the contractual employee - extends only to the period during which the Labor-Only Contractor contractual employees work for the principal - provides the personnel who will work for the - the fact that they are reassigned to another principal principal ends such responsibility - does not have substantial capital or investment - personnel supplied performs activities related for 3. Rationale for the Solidary Liability of the Job the main business of the principal Contractor and the Principal - enacted to ensure compliance with the provisions 1. Extent of Liability of Principals of Job of the Labor Code, principally those on statutory Contractors and Labor-Only Contractors minimum wage - principal is considered only as an indirect employer of the contractual employees Job Contractor - the contractor is the direct employer of the - made liable by virtue of his status as direct contractual employees employer Labor-Only Contracting Principal - principal is considered as the direct employer of - liable as indirect employer of the contractual the contractual employees employee - contractor is the the mere agent of the principal - made liable to the contractual employees because he can protect himself from irresponsible 2. The Principal of the Job Contractor Is An job contractors by withholding such sums and Indirect Employer paying them directly to the contractual employees - no employer-employee relationship exists or by requiring a bond from the job contractor between the contractual employees and the principal (legitimate job contracting) 1987 Constitution - when the job contractor fails to pay the wages of - mandates that employees be given ample his contractual employees, the principal becomes protection solidarily liable with his contractor to the - solidary liability facilitates and guarantees contractual employees to the extent of the work payment of the employee’s compensation performed under the contract, as though the contractual employees were directly employed by 4. Right of Reimbursement from the Job the principal Contractor - while the principal and the job contractor are Solidary Liability solidarily liable for the payment of wages of - “joint and several liability” contractual employees - one in which each debtor is liable for the entire - in case he pays the obligation to the contractual obligation employees - liability of the principal and the contractor for unpaid wages may be enforced against them both 5. The Principal of the Labor-Only Contractor Is by a joint action, or against any of them by A Direct Employer individual action - if the wages of the contractual employee are not Labor-Only Contracting paid, both the principal and the job contractor may - an employer-employee relationship is created by be held liable for the full amount law between the principal and the contractual employees To ensure that the contractual employees are - principal is responsible to the contractual paid the wages due them employees, as if such contractual employees - the law itself establishes an employer-employee were directly employed by him relationship for a limited purpose - the labor-only contractor is merely an agent of the principal Ledesma - the principal becomes solidarily liable with the labor-only contractor for all the rightful claims of the contractual employees - should be distinguished from the liability of the principal of a job contractor, whose liability is limited to the wages of the contractual employees for work done for the benefit of the principal 6. Rationale for the Liability of Principals of Labor-Only Contractors - law establishes an employer-employee relationship between the principal and the contractual employees for a comprehensive purpose (to prevent any violation or circumvention of any provision of the Labor Code and to safeguard the employee’s rights under the Labor Code) Ledesma  Chapter 7. Classification of Employees B. Termination of Regular Employees - regular employees may only be terminated for just I. Regular Employees or authorized causes under the law and after compliance with the requirements of due process Regular Employees (1) Those who are engaged to perform activities II. Casual Employees which are necessary or desirable in the usual business or trade of the employer, except where Casual Employee the employment is fixed for a specific term or - engaged to work on an activity which is not project, or is seasonal in nature. necessary or desirable in the usual business or (2) Those casual employees who have rendered at trade of the employer (Article 286) least 1 year of service, whether continuous or - where an employee is engaged to perform a job, broken, with respect to the activity for which work, or service which is merely incidental to the they are employed. business of the employer - such job, work or service is for a definite period Employees are deemed to be regular if they fall made known to the employee at the time of the under (1) or (2) above, despite oral or written engagement agreements stating that the employee is not a regular employee. A. When a Casual Employee acquires the status - prevent the circumvention of the employee’s right of a regular employee to security of tenure - a casual employee becomes a regular employee - employee may be denied his rights and benefits with respect to the activity in which he is due a regular employee by virtue of lopsided employed, as soon as he has completed 1 year of agreements with the economically powerful service, and his employment shall continue while employer, who can maneuver to keep an such activity exists employee on casual status for as long as - the status of a regular employee attaches to a convenient casual employee on the day immediately after the end of his 1st year of service, with respect to the A. Standards in determining regular activity in which he is employed, even if no employment appointment papers were signed by the employee - law does not provide qualification that the 1. Activities performed are necessary or employee must first be issued a regular desirable in the usual business of the appointment, or must first be formally declared as employer a regular employee before he can acquire regular - employment is deemed regular, notwithstanding status any contrary agreement - can be determined by considering the nature of B. Termination of Casual Employees the work to be performed, and its relation to the - not protected by security of tenure scheme of the particular business or trade in its - they may be removed from service at any time entirety 2. Length of Performance of the Activity III. Fixed Period or Term Employees Performed - determinative of whether the employment is Fixed-period or term employee regular or casual - employee for whom a day certain is agreed upon - if the employee has been performing the activity by the employer and the employee for the for at least 1 year, even if the performance is not commencement and termination of their continuous but intermittent, the law deems the employment relationship repeated and continuing need for its performance as sufficient evidence of the necessity, if not A. Standard in determining fixed-period or term dispensability of that activity to the business of his employment employer = employment is a regular (but only with - determinant is the day certain agreed upon by the respect to such activity and while such activity parties for the commencement and termination of exists) their employment relationship Ledesma - a day certain is understood to be that which must - rotated among the faculty members, are usually necessarily come, although it may not be known for a fixed period when Example: Certain company officials like the Example: A teacher who is engaged to teach until President, Executive Vice-President or Vice- the end of the semester is a fixed-period employee President of a company may be elected for what because it is a day certain, although the exact date would amount to fixed periods, at the expiration of may not be known by the parties yet which they would have to step down B. A Fixed-Period Employee may perform work E. Termination of Fixed-Period or Term necessary or desirable in the usual business of Employees the employer - a tenured status of employment co-exists - nothing contradictory between a definite period of - co-terminus only with the definite term fixed in the an employment contract and the nature of the contract of employment employee’s duties set down in that contract, as - a contract of employment for a definite period being usually necessary or desirable in the usual terminates on its own force at the end of such a business or trade of the employer period - the determining factor of fixed-period employment - lack of notice of termination is of no consequence, is not the activities that the employee is called because when the contract specifies the length of upon to perform, but the day agreed upon by the its duration, it comes to an end upon the parties for the commencement and termination of expiration of such period the employer-employee relationship - even if an employer errs in dismissing an employee, acting on the mistaken belief that the C. When a fixed-period or term employee employee was liable for the chargers leveled acquires the status of a regular employee against him, the employee still cannot claim - both the employer and employee have a right to entitlement to any benefit flowing from freely stipulate on the duration of the engagement employment after his termination date, because of the employee the employment had by then, already ceased to - when the agreement entered into by the parties exist fixes a period or term to circumvent security of - if the contract is for a fixed term and the employee tenure by the employee, the period or term should is dismissed without just cause, he is entitled to be struck down or disregarded as contrary to the payment of his salaries corresponding to the public policy, morals, and law unexpired portion of his contract - the fixed-period or term employee will be deemed to be a regular employee IV. Project Employees D. When Fixed Contracts of Employment are not in circumvention of the Security of Tenure Project Employees - employees whose work is coterminous with the 2 Criteria: project for which they were hired (1) The fixed-period of employment was knowingly and voluntarily agreed upon by the parties, A. Two Types of Projects without any force, duress or improper pressure being brought to bear upon the employee and Project absent any other circumstances vitiating his - one or the other of at least 2 distinguishable types consent of activities (2) It satisfactorily appears that the employer and the employee dealt with each other on more or 1. A particular job/undertaking that is within the less equal terms, with no moral dominance regular or usual business of the employer whatever being exercised by the employer or company, but which is distinct and separate, the employee and identifiable as such, from the other undertakings of the company Examples: Appointments to the positions of the - such a job/undertaking begins and ends at Dean, Assistant Dean, College Secretary, Principal, determined or determinable times and other administrative offices in educational - relates to employees in the construction industry institutions (practice or tradition) Ledesma  D. Indicators of Project Employment Example: particular construction job or project of a 1. The duration of the specific/identified construction company undertaking for which the worker is engaged is reasonably determinable 2. A particular job/undertaking that is not within 2. Such duration, as well as the specific work/ the regular business of the company. service to be performed is defined in an - such a job/undertaking must also be identifiably employment agreement and is made clear to the separate and distinct from the ordinary or regular employee at the time of hiring: business operations of the employer 3. The work/service performed by the employee is - the job/undertaking also begins and ends at in connection with the particular project/ determined or determinable times undertaking for which he is engaged: - relates to fixed-period and season employees 4. The employee, while not employed and awaiting engagement, is free to offer his services to any In some cases, fixed-period or term employees are other employer considered as project employees. 5. The termination of his employment in the particular project/undertaking is reported to B. Employees in the Construction Industry DOLE Regional Office having jurisdiction over the workplace, with thirty (3) days following the Classifications of Employees in the Construction date of his separation from work, using the Industry prescribed form on employees' terminations/ 1. Project Employees dismissals/suspensions; - employed in connection with a particular 6. An undertaking in the employment contract by construction project or a phase thereof the employer to pay a completion bonus to the - employment is co-terminus with each project or project employee as practiced by most phase of the project to which they are assigned construction companies 2. Non-project Employees E. Rehiring of Project Employees upon Completion of the Project C. When A Project Employee Acquires the Status of a Regular Employee - The employees of a particular project are not separated from work at the same time because Project Employees - whose aggregate period of some phases of the project are completed ahead continuous employment in a construction company of the others is at least 1 year shall be considered regular - For this reason, the completion of a phase of the employees, in the absence of a “day certain” agreed project is considered the completion of the project upon by the parties for the termination of their for an employee employed in such phase relationship - Meanwhile, those employed in a particular phase of a construction project are also not separated at The mere fact that a project employee has worked the same time on a specific project for more than 1 year does not - Normally the number of employees required as necessarily change his status as project employee the phase draws closer to completion grows fewer and convert it to regular employment. and fewer - Upon completion of a project or phase thereof, An employee who has served for at least 1 year the project employee may be rehired for another shall be considered as a regular employee undertaking, provided that such rehiring conforms - only relates to casual employees, not to project to the provisions of law and DO 19-93 employees - In such a case, the last day of service with the employer in the preceding project should be It is only when a project employee has been indicated in the employment contract engaged for at least 1 year and no date has been agreed upon by the employer and employee F. Non-Project Employees in the Construction regarding the expected completion of the project, Industry that a project employee becomes a regular employee Non-project Employees - are those employed without reference to any particular construction project/phase of a project Ledesma  V. Seasonal Employees 3 types: 1. Probationary Employees Seasonal Employees - those who, upon the completion of the - who perform work or service that is seasonal in probationary period, are entitled to regularization nature or whose employment is for the duration of - upon their engagement, probationary employees the season should be informed of the reasonable standards - if the employer is mainly into milling operations, under which they would qualify as regular the employees engaged are not seasonal but employees regular employees 2. Regular Employees Example: Harvest of Palay employees - those who fall under any of the following - big rice mills continue to operate and do business categories: throughout the year, even if there are only 2 or 3 (1) Those appointed as such: harvest seasons per year (2) Those who have completed the probationary - milling operations have no let-up and the period, or employees engaged in establishments are regular (3) Those appointed to fill up regular positions employees vacated as a result of death. retirement, resignation or the termination of employment of A. When a Seasonal Employee Acquires the the regular holders thereof Status of a Regular Employee - when the seasonal employees are repeatedly re- 3. Casual Employees employed by the employer every season. the - employed to perform work not related to the main seasonal employees are deemed regular line of business of the employer Casual seasonal employees employees who are employed for at least one (1) - as such, during off-seasons, they are not year, whether continuous or broken, shall be considered as separated from service, but rather considered regular employees with respect to the as being on leave of absence without pay until activity in which they are employed they are re-employed - their employment shall continue for as long as - during off-seasons, the employment relationship such activity exists, unless the said employment is not severed but only suspended is terminated sooner by the employer for a just or - this is because the cessation of the activities at authorized cause, or voluntarily by the employee the end of the season is certainly not permanent or definitive G. Termination of Project Employees - it is a foreseeable suspension of work, hence no compensation is expected nor demanded during - if the termination is brought about by the the seasonal lay off completion of the contract or phase of the - also, during the temporary lay off, the employees contract, no prior notice is required are considered free to seek other employment, - in case of dismissal of project employees in the since during this time, employees are not being construction industry the employer shall include paid and so must find a means of support for the same in its Monthly Report on Employees' themselves and their families Terminations/ Dismissals/Suspensions submitted - Hence, employees hired for every harvest season to DOLE Regional Office are deemed to be regular seasonal employees - if the project or phase of the project that the rather than mere seasonal employees project employee is working on has not yet been completed and his services are terminated B. Termination of Seasonal Employees without just or authorized cause. and if there is no - seasonal employees are hired only for the indication that his services are unsatisfactory the duration of the season project employee is entitled to reinstatement with - their services are terminated at the end of the back wages to his former position or to a season substantially equivalent position - if the reinstatement is no longer possible, the employee is entitled to his salaries for the unexpired portion of the agreement Ledesma  VI. Probationary Employees D. Probationary Period of Professors, Instructors, and Teachers Probationary Employees - private school teachers = 3 consecutive years of - those who are on trial by an employer during satisfactory service which the employer determines whether they are qualified for regular employment E. Extension of the General Probationary Period - An exception to the general probationary period of Probationary Period six (6) months occurs when the parties to an - trial period where the employer observes the employment contract agree to a longer fitness, propriety and efficiency of a probationary probationary period. employee, to ascertain whether he is qualified for regular employment in accordance with This may occur in two instances: reasonable standards made known by the 1. By stipulation in the original contract of employer to the employee at the time of his employment engagement 2. By extension agreed upon at or prior to the - during this trial period, the probationary employee expiration of the 6-month period seeks to prove to the employer that he has the qualifications to meet the reasonable standards Stipulation in the Original Contract of for regular employment Employment - the parties may agree to a probationary period A. Period of Probationary Employment longer than six (6) months when the same is - different probationary periods according to the established by company policy or when it is requirements of the particular job required by the nature of the work to be - period required to learn a skill, trade, occupation performed by the employee or profession - especially where the employee must learn a - after the expiration of the probationary period, the particular kind of work such as selling, or when probationary employee becomes a regular the job requires certain qualifications, skills, employee experience or training - in a case decided by the Supreme Court, the B. General Probationary Period probationary period agreed upon by the parties at - last 6 months but the probationary period is the the onset of a contract for eighteen (18) months period needed to determine the employee’s was held to be valid and not contrary to law, fitness for the job morals and public policy - lack of better measurement - it was shown that the employer which was - period needed to learn the job engaged in advertising and the publication of the Yellow Pages of the PLDT Telephone Directories, C. Probationary Period of An Apprenticeable and needed at least eighteen (18) months to Learnable Job determine the character and selling capabilities of - if the job is apprenticeable, the probationary its probationary employees period is the apprenticeship period, which may be six (6) months. less than six (6) months, or more Extension agreed upon at or prior to the than six (6) months, depending on the nature of expiration of the 6-month period the job - When a probationary employee fails to qualify as - upon graduation, an apprentice may not be put a regular employee during the expiration of the 6- under probationary employment in the company month probationary period, the employer may where he trained terminate his service - however in another company the probationary - the employer and the employee may jointly agree period for him would be six (6) months again, so to extend the period of probation as to allow the employer to test his working habits - improve and further a probationary employee's and other personal traits with respect to his prospects of demonstrating his fitness for regular fitness for regularization in the company employment - if the job is learnable, that is, if it can be learned - the employer may give the probationary employee within three (3) months or less a second chance to make good or improve his - the learner, upon completion of the learning performance, after having initially failed to do so, period, must be considered a regular employee by extending his 6-month probationary period Ledesma - the extension of the probationary period must be H. Termination of Probationary Employees done at or prior to the expiration of the 6-month - in case of probationary employment, if the probationary period termination is brought about by the failure of an - otherwise, the employee will automatically employee to meet the standards of the employer become a regular employee by operation of law it shall be sufficient that a written notice is served - if the probationary employee still fails to meet the the employee within a reasonable time from the standards of the employer during the period of effective date of termination extension of the probationary employment, he cannot claim to have acquired the status of regular employment on account of his continued employment after the 6-month probationary period F. When a Probationary Employee Acquires Status as a Regular Employee - generally probationary employment shall not exceed 6 months - this means that the probationary employee may be dismissed for cause at anytime before the expiration of six (6) months after hiring - if after working for less than six (6) months, he is found to be unfit for the job, he can be dismissed - however, if he continues to be employed longer than six (6) months, he ceases to be a probationary employee and becomes a regular employee - in all cases of probationary employment, the employer has to inform the employee, at the time of his engagement, of the standards under which he will qualify as a regular employee - where no standards for regular employment are made known to the employee at the time of his engagement, he shall be deemed a regular employee G. Acquisition of Regular Status Before the Expiration of the 6-Month Probationary Period - probationary employment for six (6) months is not employment for a definite period of time - as such, an employer is not duty-bound to allow the probationary employee to work until the termination of the probationary employment before granting him regular status - hence, an employer may extend a regular or a permanent employment to an employee once the employer determines that the employee is qualified for regular employment, even before the expiration of the 6-month probationary period - conversely if the purpose sought by the employer is neither attained nor attainable within the said period, the law does not likewise preclude the employer from terminating the probationary employment on justifiable causes Ledesma  Chapter 3. Conditions of Employment and Leave 3. Employees of retail and service establishments Benefits under Special Laws regularly employing less than 10 workers 4. Employees in establishments exempted from granting service incentive leave by the Secretary Part 1 - Scope of Title of Labor and Employment (“Labor Secretary”) after considering the viability or financial Title I. Working Conditions and Rest Periods condition of the establishment, are not entitled to refers to the following employment benefits: service incentive leave 1. Normal hours of work 2. Meal periods II. Definitions 3. Rest periods 4. Night-shift differential 5. Overtime pay A. Government Employees 6. Weekly rest day - employed by the National Government or any of 7. Holiday pay its political subdivisions, including those employed 8. Service incentive leave in government-owned and/or controlled 9. Service charges corporations B. Managerial Employees I. Excluded Employees - those whose primary duty consists of the management of the establishment, or a 1. Government Employees department or subdivision of the establishment in 2. Managerial Employees which they are employed, including other officers 3. Officers and Members of the Managerial Staff or members of the managerial staff 4. Field Personnel 5. Employer’s family members Employees shall be considered Managerial 6. Domestic helpers and persons in the personal Employees if they meet all of the following service of another conditions: 7. Workers paid by results 1. Their primary duty consists of the management of the establishment in which they are employed, A. Additional Excluded Employees for Night- or of a department or subdivision of the Shift Differential establishment. - employees of retail and service establishments 2. They customarily and regularly direct the work of regularly employing not more than 5 workers are two (2) or more employees in the establishment, not entitled to night-shift differential or a department or subdivision of the establishment; and Retail Establishment 3. They have the authority to hire and fire - principally engaged in the sale of goods to end- employees of lower rank; or their suggestions users for personal or household use and recommendations as to hiring and firing, or the promotion or any other change of status of Service Establishment other employees, is given particular weight - primarily engaged in the sale of service to individuals for their own use or for household use C. Officers or members of the managerial staff - primary duty consists of the performance of work B. Additional Excluded Employees for Holiday directly related to the management policies of Pay their employer - employees of retail and service establishments - customarily and regularly exercise discretion and regularly employing less than 10 workers are not independent judgment; entitled to regular holiday pay - either: (i) Regularly and directly assist a proprietor or a managerial employee; (ii) Execute under C. Additional Excluded Employees for Service general supervision work along specialized or Incentive Leave technical lines requiring special training, 1. Employees who are already enjoying the benefit experience, or knowledge; or (iii) Execute, under of 5 days service incentive leave with pay general supervision, special assignments and 2. Employees enjoying vacation leave with pay of tasks; and at least 5 days - do not devote more than 20% of their hours worked in a workweek to activities which are not Ledesma  directly and closely related to the performance of I. What Hours Worked Include the work described in paragraphs (i), (ii) and (iii) above The following shall be considered as compensable hours worked: D. Field Personnel (1) All the time during which an employee is - refer to non-agricultural employees who regularly required to be on duty or to be at a prescribed perform their duties away from the principal place workplace; and of business or branch office of the employer (2) All the time during which an employee is - whose actual hours of work in the field cannot be suffered or permitted to work determined with reasonable certainty The following general principles shall govern in E. Employer’s Family Members - refer to the members of the family of the employer who are dependent on the employer for support II. How to Determine Hours Worked F. Domestic Helpers and Persons in the determining whether the time spent by an employee Personal Service of Another is considered hours worked: - those who perform services in the employer’s home which are usually necessary or desirable 1. All hours are hours worked which the employee for the maintenance and enjoyment of the home, is required to give his employer, regardless of or who minister to the personal comfort, whether such hours are spent in productive labor convenience, or safety of the employer, as well as or involve physical or mental exertion; the members of his household 2. An employee need not leave the premises of the work place in order that his rest period shall not be counted, it being enough that he stops III. Non-Diminution of Benefits working, may rest completely and may leave his work place to go elsewhere, whether within or If the excluded employees already enjoy the outside the premises of his work place; employment benefits under Title I either: 3. If the work performed was necessary, or it benefited the employer, or the employee could (1) By agreement between the employer and the not abandon his work at the end of his normal employees, or working hours because he had no replacement, all the time spent for such work shall be (2) Because of an established company practice, considered as hours worked, if the work was these benefits may not be withdrawn, eliminated with the knowledge of his employer or immediate or reduced because of the principle of non- supervisor; diminution of benefits. applying this principle, if 4. The time during which an employee is inactive the covered employees enjoy more employment by reason of interruptions in his work beyond his benefits than those provided under Title I, these control shall be considered working time, either if employment benefits cannot be reduced to the imminence or the resumption of work conform to the minimum requirements of the requires the employee’s presence at the place of law. work, or if the interval is too brief to be utilized effectively and gainfully in the employee’s own interest Part 2 - Hours of Work Article 83. Normal Hours of Work - shall not exceed 8 hours a day Article 84. Hours Worked shall include: a. All time during which an employee is required to be on duty or to be at a prescribed workplace; and b. All time during which an employee is suffered or permitted to work Ledesma  III. Broken Shifts VI. Attendance in Lectures, Meetings or Training Programs The employer and employee may agree on the schedule of working hours of the employee. Attendance in lectures, meetings, training programs, and other similar activities shall not be counted as If the established working hours of an employee working time if all of the following conditions are run from 8AM up to 12NN and then from 4PM up met: to 8PM, the employee may only be compensated 1. Attendance is outside of the employee’s regular for the actual hours worked. working hours 2. Attendance is voluntary; The period from 12NN up to 4PM is not 3. The employee does not perform any productive considered as working time as he is not required work during such attendance to be at the prescribed workplace during this 4- hour period. Meetings conducted by employees to organize themselves to form a union is not working time. Similarly, attendance at a company outing or training is not working time unless attendance is compulsory. IV. Waiting Time Part 3 - Meal Period Waiting time spent by an employee shall be considered as working time in the following instances: A. When Meal Period is Compensable 1. When waiting is an integral part of the work 2. When the employee is required or engaged by Article 85. Meals Periods. Subject to such the employer to wait (Section 5, Rule I, Book III, regulations as the Secretary of Labor may prescribe, Omnibus Rules). A company driver who brings it shall be the duty of every employer to give his the manager to a meeting, waits for the employees not less than 60 minutes time-off for their manager, and after the meeting, drives the regular meals. manager back to the establishment of the employer, is considered to be working while Meal Period/Meal break waiting. - period consisting of sixty (60) minutes or one (1) hour time-off given by employers to employees for their regular meals - the 1-hour meal break is not considered working V. On-Call Time time. Hence, it is not compensable In the following cases, a meal period of not less An employee who is required to remain on-call in than twenty (20) minutes may be given by the the employer’s premises or so close to the employer, provided that such shorter meal premises that he cannot use the time effectively period is credited as compensable hours worked and gainfully for his own purpose shall be by the employee: considered as working while on-call. 1. Where the work is non-manual work in nature or However, an employee is not working while on-call does not involve strenuous physical exertion; when he is not required to leave word at his home 2. Where the establishment regularly operates not or with company officials as to where he may be less than sixteen (16) hours a day reached. 3. In case of actual or impending emergencies or there is urgent work to be performed on machineries, equipment or installations to avoid serious loss which the employer would otherwise suffer; 4. Where the work is necessary to prevent serious loss of perishable goods Ledesma  B. Where Meals May Be Taken the work time’s adverse effect upon efficiency and output, and its remotely injurious effect on his health, consonant with the common saying among Meals need not be taken within the premises of the wage-earning people that the night was made for company. Even if an employee is obliged to stay in rest and sleep, and not for work. the company premises for eight (8) hours, there is nothing in the law which states that employees must take their meals within the company premises. Part 6 - Overtime Pay Employees are not prohibited from leaving the premises as long as they return to their posts on Article 87. Overtime Work. Work may be performed time. beyond eight (8) hours a day provided that the employee is paid for the overtime work, an Part 4 - Rest Periods additional compensation equivalent to his regular wage plus at least twenty-five percent (25%) thereof. Work performed beyond eight hours on a holiday or Article 84. Hours worked. Rest periods of short rest day shall be paid an additional compensation duration during working hours shall be counted as equivalent to the rate of the first eight hours on a hours worked. holiday or rest day plus at least thirty percent (30%) thereof. Rest Periods/Coffee Breaks - periods of short duration - running from 5-20 minutes during working hours Article 88. Undertime Not Offset by Overtime. - considered as compensable working time Undertime work on any particular day shall not be offset by overtime work on any other day. Permission given to the employee to go on leave on Part 5 - Night-Shift Differential some other day of the week shall not exempt the employer from paying the additional compensation required in this chapter. Article 86. Night Shift Differential. Every employee shall be paid a night-shift differential of not less than Article 89. Emergency Overtime Work. Any 10% of his regular wage for each hour of work employee may be required by the employer to performed between 10 PM-6 AM perform overtime work in any of the following cases: a. When the country is at war or when any other Night-Shift Differential national or local emergency has been declared - additional compensation paid to employees for by the National Assembly or the chief executive; each hour of work performed between 10 pm-6 b. When it is necessary to prevent loss of life or am property or in case of imminent danger to public safety due to an actual or impending emergency A. Night-Shift Differential Rate in the locality caused by serious accidents, fire, flood, typhoon, earthquake, epidemic, or other - equivalent to at least 10% of the regular hourly disaster or calamity; c. When there is urgent work to be performed on wage of the employee machines, installations, or equipment, in order to avoid serious loss or damage to the employer or some other cause of similar nature; d. When the work is necessary to prevent loss or damage to perishable goods; and e. Where the completion or continuation of the work started before the eighth hour is necessary B. Rationale for Night-Shift Differential to prevent serious obstruction or prejudice to the business or operations of the employer. A night-shift differential is paid for the work done f. Any employee required to render overtime work during the graveyard shift because an employee under this Article shall be paid the additional must contend with night work inconveniences and compensation required in this chapter. disadvantages, such as disarrangement of his social life, the loss of recreation or activities for leisure and the ordinary association of normal family relations, Ledesma Article 90. Computation of Additional B. Undertime Not Offset by Overtime Compensation. For purposes of computing overtime and other additional remuneration as required by this chapter, the “regular wage” of an - The legal prohibition to offset overtime against employee shall include the cash wage only, without undertime (Article 88) applies only to undertime deduction on account of facilities provided by the incurred and overtime work rendered on different employer. days, because the employee would be deprived of additional pay for overtime wor