Labor Laws.pdf

Strategic Human Resource Management Basic Philippine Labor Laws Prepared by: Lyle De la Cerna. Contents Basic Terminologies Types of Employment Employee Benefits Wage and Compensation Benefits Leave Benefits Mandatory Government Contributions Work Hours and Rest Period prepared by: Lyle De la Cerna. 2 Knowledge is Power Ignorance of the law does not excuse anyone from complying with it. Knowing laws on labor and employment is vital because a minor violation could lead to big trouble. Companies have closed shop after employees sued which ended up with paying huge amounts of money representing damages. prepared by: Lyle De la Cerna. 3 Basic Terminologies prepared by: Lyle De la Cerna. 4 Basic Terminologies REPUBLIC ACT No. 602 April 6, 1951 AN ACT TO ESTABLISH A MINIMUM WAGE LAW, AND FOR OTHER PURPOSES (REPEALED BY PRESIDENTIAL DECREE NO. 442) prepared by: Lyle De la Cerna. 5 Basic Terminologies "Person" means an individual, partnership, association, corporation, business trust, legal representative, or any organized group of persons. prepared by: Lyle De la Cerna. 6 Basic Terminologies "Employer" includes any person acting directly or indirectly in the interest of an employer in relation to an employee and shall include the Government, and the government corporations. "Employee" includes any individual employed by an employer. prepared by: Lyle De la Cerna. 7 Basic Terminologies "Agriculture" includes farming in all its branches and among other things includes the the cultivation and tillage of the soil, dairying, the production, cultivation, growing, and harvesting of any agricultural or horticultural commodities, the raising of livestock or poultry, prepared by: Lyle De la Cerna. 8 Basic Terminologies "Agriculture" and any practices performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, but does not include the manufacturing or processing of sugar, coconuts, abaca, tobacco, pineapple or other farm products. prepared by: Lyle De la Cerna. 9 Basic Terminologies "Industry" means a trade, business, industry or branch thereof, or group of industries, in which individuals are gainfully employed. "Employ" includes to suffer or permit to work. prepared by: Lyle De la Cerna. 10 Basic Terminologies "Wage" paid to any employee shall mean the remuneration or earnings, however designated, capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, commission basis, or other method of calculating the same, prepared by: Lyle De la Cerna. 11 Basic Terminologies "Wage" paid to any employee shall mean the remuneration or earnings,..... which is payable by an employer to an employee under a written or unwritten contract of employment for work done or to be done or for services rendered or to be rendered, and includes the fair and reasonable value, as determined by the Secretary of Labor, of board, lodging, or other facilities customarily furnished by the employer to the employee. prepared by: Lyle De la Cerna. 12 Basic Terminologies "Facilities" shall include articles or services of benefit to the employee or his family, but shall not include tools of the trade or articles or services primarily for the benefit of the employer or necessary to the conduct of the employer's business. prepared by: Lyle De la Cerna. 13 Basic Terminologies "Hired farm labor" includes the labor of any person employed on a farm, except the labor of the operator and that of his parents, spouse and children. NOTE: Operator is the owner or lessee prepared by: Lyle De la Cerna. 14 Basic Terminologies "Farm enterprise" comprises all tracts of land, whether contiguous or not, under one management, located in a province and immediately adjacent provinces, on which any of the operations enumerated in section two (d) are carried on. prepared by: Lyle De la Cerna. 15 Types of Employment prepared by: Lyle De la Cerna. 16 Employment Article 280 of the Labor Code of the Philippines (LCP) describes different types of employment namely: regular casual project seasonal These distinctions are important because some rights and benefits attach only to regular employees, especially the right to security of tenure. prepared by: Lyle De la Cerna. 17 Regular and Casual Employment “ARTICLE 280. Regular and casual employment. — The provisions of written agreement to the contrary notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer…… prepared by: Lyle De la Cerna. 18 Regular and Casual Employment “ARTICLE 280. Regular and casual employment. ……….except where the employment has been fixed for a specific project or undertaking the completion or termination of which has been determined at the time of the engagement of the employee or where the work or service to be performed is seasonal in nature and the employment is for the duration of the season. prepared by: Lyle De la Cerna. 19 Regular and Casual Employment ARTICLE 280. Regular and casual employment. An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That any employee who has rendered at least one year of service, whether such service is continuous or broken, shall be considered a regular employee with respect to the activity in which he is employed and his employment shall continue while such activity exists. prepared by: Lyle De la Cerna. 20 Probationary Employment ARTICLE 281. Probationary employment. – Probationary employment shall not exceed six (6) months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period. prepared by: Lyle De la Cerna. 21 Probationary Employment ARTICLE 281. Probationary employment. –The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of his engagement. An employee who is allowed to work after a probationary period shall be considered a regular employee. prepared by: Lyle De la Cerna. 22 Probationary Employment The period should not exceed six (6) months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period. (Article 281) prepared by: Lyle De la Cerna. 23 Probationary Employment A probationary employee may be dismissed for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards made known to him at the time he is hired. prepared by: Lyle De la Cerna. 24 Probationary Employment If he is not informed of these reasonable criteria, he will be considered a regular employee. So, employers should watch out for this requirement. a probationary employee may become regular if he is allowed to work after the probationary period. prepared by: Lyle De la Cerna. 25 Project Employment Where the employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of the engagement of the employee in the Philippines. prepared by: Lyle De la Cerna. 26 Seasonal Employment Where the work or services to be performed is seasonal in nature and the employment is for the duration of the season in the Philippines. prepared by: Lyle De la Cerna. 27 Casual Employment There is Casual Employment when an employee performs work that is not usually necessary or primarily related to the employer’s business or trade. The definite period of employment should be made known to the employee at the time they started rendering service. prepared by: Lyle De la Cerna. 28 Casual Employment If the employee has rendered service for at least one (1) year in the same company, whether the casual employment is continuous or not, they shall be considered a regular employee with respect to the activity they are employed and will continue rendering service while such activity exists. prepared by: Lyle De la Cerna. 29 Contractual Employment Term or Fixed-Term Employment is when the employee renders service for a definite period of time and the employment contract must be terminated after such period expires. This type of employment is determined not by the activities that the employee is expected to perform but by the commencement and termination of the employment relationship. prepared by: Lyle De la Cerna. 30 Contractual Employment Fixed-term employment is highly regulated and is subject to the following criteria: be voluntarily and knowingly agreed upon by the parties without any force, duress or improper pressure being brought to bear upon the employee and absent any vices of consent; or it satisfactorily appears that the employer and the employee dealt with each other on more or less equal terms with no dominance exercised by the former over the latter. prepared by: Lyle De la Cerna. 31 Employment So if you do not intend to consider the person hired as a regular employee, you must inform him on the day he starts to work – that is, whether he is a casual, seasonal, project or a fixed term employee. prepared by: Lyle De la Cerna. 32 Employee Benefits prepared by: Lyle De la Cerna. 33 Wage and Compensations Benefits 1. Employee Minimum Wage 2. Overtime Pay 3. Premium Pay 4. Night Shift Differential 5. 13th Month Pay 6. Separation Pay 7. Retirement Pay prepared by: Lyle De la Cerna. 34 Leave Benefits 1. Service Incentive Leave 2. Parental leaves 3. Special Leave Benefits for Women 4. Bereavement Leave 5. De Minimis Benefits prepared by: Lyle De la Cerna. 35 Mandatory Government Contributions 1. Social Security System 2. PhilHealth 3. Pag-IBIG prepared by: Lyle De la Cerna. 36 Wage and Compensation Benefits prepared by: Lyle De la Cerna. 37 Wage and Compensations Benefits 1. Employee Minimum Wage 2. Overtime Pay 3. Premium Pay 4. Night Shift Differential 5. 13th Month Pay 6. Separation Pay 7. Retirement Pay prepared by: Lyle De la Cerna. 38 Minimum Wage Minimum wages have been defined as “the minimum amount of remuneration that an employer is required to pay wage earners for the work performed during a given period, which cannot be reduced by collective agreement or an individual contract”. ILO: General Survey concerning the Minimum Wage Fixing Convention, 1970 (No. 131) , and the Minimum Wage Fixing Recommendation, 1970 (No. 135) prepared by: Lyle De la Cerna. 39 Minimum Wage The purpose of minimum wages is to protect workers against unduly low pay. They help ensure a just and equitable share of the fruits of progress to all, and a minimum living wage to all who are employed and in need of such protection. prepared by: Lyle De la Cerna. 40 Minimum Wage Minimum wages can also be one element of a policy to: overcome poverty reduce inequality, including those between men and women promote the right to equal remuneration for work of equal value. prepared by: Lyle De la Cerna. 41 prepared by: Lyle De la Cerna. 42 prepared by: Lyle De la Cerna. 43 prepared by: Lyle De la Cerna. 44 prepared by: Lyle De la Cerna. 45 Overtime Pay The employee who renders service beyond the schedule indicated in the contract will be given additional compensation equivalent to his regular wage including at least 25% premium. prepared by: Lyle De la Cerna. 46 Premium Pay A premium pay is an overtime pay for rest days and official holidays. Employee shall be paid an additional compensation from the rate of the first eight hours on a holiday or rest day plus at least 30%. prepared by: Lyle De la Cerna. 47 Premium Pay There are three types: Regular Holidays These refer to fixed dates like Christmas Day, Independence Day, or New Year’s Day. However, National Heroes Day and Holy Week are considered regular holidays despite changing dates. prepared by: Lyle De la Cerna. 48 Premium Pay There are three types: Regular Holidays For Regular Holidays, every employee covered by the Holiday Pay Rule is entitled to the minimum wage rate(daily basic wage and COLA). prepared by: Lyle De la Cerna. 49 Premium Pay There are three types: Regular Holidays This means that the employee is entitled to at least 100% of their minimum wage rate even if they did not report for work, provided that they are present or is on leave of absence with pay on the work day immediately preceding the holiday. If your employer asks you to work on a regular holiday, you will be paid 200 percent of your daily rate and cost of living allowance prepared by: Lyle De la Cerna. 50 Premium Pay There are three types: Special Holidays Also known as Special Non-Working Holidays, they fall on flexible dates, depending on the circumstance. prepared by: Lyle De la Cerna. 51 Premium Pay There are three types: Special Holidays For Special Holidays, the “No work, No pay” principle applies and on such other Special Holidays as may be proclaimed by the President or by Congress. On the other hand, if your employer asks you to work on a special non-working holiday, you will be paid 130 percent of your daily rate and cost of living allowance. Example: Election day prepared by: Lyle De la Cerna. 52 Premium Pay There are three types: Double Holidays This is a rare occurrence wherein a regular holiday and a special holiday fall on the same day. Example: If Araw ng Kagitingan falls on the same day as Maundy Thursday or Good Friday. Labor Code of the Philippines, Article 94. prepared by: Lyle De la Cerna. 53 Premium Pay There are three types: Double Holidays An employee who does not work on a double holiday shall be paid at the rate of 200% of their daily wage. An employee who reports at work on a double holiday shall be paid 300% of his/her regular wage. An employee who works overtime on a double holiday shall be paid an additional 30% of his/her daily rate of 300%. prepared by: Lyle De la Cerna. 54 Premium Pay All employees are eligible for premium pay, but normally, the slots for working on holidays or rest days are scheduled in advance and approved by authorized personnel. prepared by: Lyle De la Cerna. 55 Night Shift Differential Also known as night shift pay, it applies to employees who work between 10:00 PM and 6:00 AM. An additional 10% premium is applied for every hour at work. prepared by: Lyle De la Cerna. 56 13th Month Pay The 13 month pay is often mistaken as the Christmas Bonus, but technically, it’s a monetary bonus mandated by law. The Christmas bonus is only a voluntary gesture from the employers. According to the law, the 13 month pay is given either in 2 installments (May and December) or in full before December 24. prepared by: Lyle De la Cerna. 57 13th Month Pay You can receive this pay if you are any private employee with fixed or guaranteed salary who have worked for at least one month. Resigned or terminated employees who left their employers before the release of the 13 month bonuses can also receive this. Take note that employees who quit the job without going through the separation process and workers who are paid purely on commission are not entitled for 13 month pay. prepared by: Lyle De la Cerna. 58 13th Month Pay The 13th-month pay in the Philippines is equivalent to 1/12 of the basic salary received by an employee within the year. If a Filipino employee worked for less than a year (regardless of the cause for the termination of his employment), the amount due to him is determined by dividing the total salary he received by the number of months he was employed. prepared by: Lyle De la Cerna. 59 13th Month Pay The Philippine government shares in it by way of income tax. Under existing tax regulations, up to a maximum of P90,000 of that additional income is exempt from the income tax due from fixed wage earners. prepared by: Lyle De la Cerna. 60 Separation Pay Separation pay is also part of the Labor Code and is given to employees terminated from the company. The only exception are those terminated because of misconduct or crime involvement. prepared by: Lyle De la Cerna. 61 Separation Pay There are two types: 1/2 Month Pay per Year of Service An employee is eligible for separation pay with the value of one-half (1/2) month pay for every year of service if the separation from the service is because of retrenchment to save the company from pitfalls, closure or termination of the operations due to bankruptcy and other bad instances, and grave illness incurable within 6 months or harmful for co-workers. prepared by: Lyle De la Cerna. 62 Separation Pay There are two types: One-Month Pay per Year of Service An employee is eligible for a separation pay worth of one month per year of service if the termination of the contract is because of: installation of devices or machines that reduce the number of labors, redundancy, or when there is excessive manpower, impossible reinstatement to the former position because of significant reasons. prepared by: Lyle De la Cerna. 63 Retirement Pay Upon the age of 60 years or more, an employee who has served at the establishment for at least five years may be granted a retirement pay equivalent to at least one-half month of salary for every year of service. A fraction of at least six months is considered as one whole year. prepared by: Lyle De la Cerna. 64 Retirement Pay As stipulated by the DOLE National Wages and Productivity Commission, “The minimum retirement pay shall be equivalent to one-half (1/2) month salary for every year of service, a fraction of at least six (6) months being considered as one (1) whole year.” prepared by: Lyle De la Cerna. 65 Retirement Pay Included in the one-half pay are 15 days salary based on the latest salary rate, cash equivalent of 5 days of service incentive leave, one-twelfth (1/12) of the 13th month pay. prepared by: Lyle De la Cerna. 66 Leave Benefits prepared by: Lyle De la Cerna. 67 Leave Benefits 1. Service Incentive Leave 2. Parental leaves 3. Special Leave Benefits for Women 4. Bereavement Leave 5. De Minimis Benefits prepared by: Lyle De la Cerna. 68 Service Incentive Leave Article 95 of the Labor Code says that an employee who has worked for a year is entitled to five (5) Service Incentive Leaves with full pay. These can be used for vacation leave or sick leave. prepared by: Lyle De la Cerna. 69 Parental leaves There are 3 types of parental leaves: 1. Maternal any pregnant woman employee who has worked with the company for at least six months will be granted a maternity leave of at least two weeks prior to her due date (expected date of delivery) and four weeks after normal delivery or miscarriage with full pay based on her regular salary. prepared by: Lyle De la Cerna. 70 Parental leaves There are 3 types of parental leaves: Maternal As of February 21, 2019, the Expanded Maternity Leave (EML) Bill has been signed into law. This law grants 105 days of paid maternity leave credits. The law also allows new mothers to extend this leave for an additional 30 days, but this will be unpaid. The EML is applicable to all a woman’s pregnancies. prepared by: Lyle De la Cerna. 71 Parental leaves There are 3 types of parental leaves: Paternal The R.A No. 8187, or Paternity Leave Act of 1996, grants seven (7) days of fully paid leave to married fathers. This is effective up to the first four deliveries of the legitimate spouse. Under the EML, seven days of a woman’s paid maternity leave credits can be transferred to fathers, extending the allowed seven-day paternity to be extended to 14. prepared by: Lyle De la Cerna. 72 Parental leaves There are 3 types of parental leaves: Solo Parent Solo or single mothers and fathers have seven days leave with pay for every year of service, on top of other leave privileges, e.g. Maternity or Paternity Leave. Solo mothers are covered by the EML, so they also get 105 days of paid maternity leave credits. However, solo mothers can extend their leave for 15 days and these should be paid leaves. prepared by: Lyle De la Cerna. 73 Special Leave Benefits for Women There are two types: Magna Carta for Women This entitles women who underwent surgery due to gynecological disorders to two months’ leave with full pay, as stipulated in R.A. 9710 or the Magna Carta of Women. This applies to employees who have rendered at least six months of service with the company. prepared by: Lyle De la Cerna. 74 Special Leave Benefits for Women There are two types: Leave for women and their children who are victims of violence Victims of violence against women, as stipulated in R.A. 9262 or the Anti-Violence Against Women and Their Children Act of 2004, are entitled to 10 days leave with full pay. prepared by: Lyle De la Cerna. 75 Bereavement Leave This is a 3 days additional time off from work to mourn for the death of immediate family members such as mother, father, siblings, and children. It must be noted that this is not a paid leave. prepared by: Lyle De la Cerna. 76 De Minimis Benefits These are either relatively small amounts of money or leave credits that are optional for employers to grant. Examples are: calamity leave, rice subsidy, transportation/clothing/laundry allowance, daily meal allowance, other goods that are not monetary. prepared by: Lyle De la Cerna. 77 Mandatory Government Contributions prepared by: Lyle De la Cerna. 78 Mandatory Government Contributions 1. Social Security System 2. PhilHealth 3. Pag-IBIG prepared by: Lyle De la Cerna. 79 Social Security System The Social Security System (SSS)serves as an insurance program set by the government for all wage earners from the private institutions The counterpart for government employees is, Government Service Insurance System (GSIS) in the country. Members are required to contribute a certain amount depending on their salary bracket. prepared by: Lyle De la Cerna. 80 Social Security System Coverage in the Philippines All persons under the age of 60 who earn income from employment are required to contribute to the SSS. Government employees are required to contribute to the equivalent GSIS. prepared by: Lyle De la Cerna. 81 PhilHealth This serves as a health insurance program for private employees providing financial aid and service privileges for health care. PhilHealth has removed the previous salary brackets, creating a new condensed contribution table with P10,000 as the salary floor and P40,000 as the ceiling. The computation starts at 2.75% of the basic salary per month, and the payment is shared by employer and employee. prepared by: Lyle De la Cerna. 82 PhilHealth The PhilHealth benefits include: Inpatient benefits (hospitalization, facility fees, and physician/surgeon fees) Outpatient benefits (day surgeries, radiotherapy, hemodialysis, outpatient blood transfusion, primary care benefits) prepared by: Lyle De la Cerna. 83 PhilHealth The PhilHealth benefits include: Z benefits (financial/medical aid for the patients with cancer and in need of surgeries) SDG related (Malaria package, HIV-AIDS package, anti- Tuberculosis treatment, voluntary surgical contraception procedures, and animal bites treatment) prepared by: Lyle De la Cerna. 84 PhilHealth Coverage in the Philippines Employees are also required to contribute to the HDMF and PhilHealth. Membership is optional for self-employed persons. Foreign personnel are also required to make contributions. prepared by: Lyle De la Cerna. 85 Pag-IBIG Also known as the Home Development Mutual Fund (HDMF), Pag-IBIG is another form of national savings program and the financing office for affordable shelter. The total contribution is shared between you and the employer. prepared by: Lyle De la Cerna. 86 Pag-IBIG The highest compensation per month subjected to Pag-IBIG contribution is P5,000 and it means that the employer and employee will pay P100 each as the maximum contribution. Pag-IBIG lets you have the following benefits: housing loan, multi-purpose loan, calamity loan, secured savings. prepared by: Lyle De la Cerna. 87 Work Hours and Rest Period prepared by: Lyle De la Cerna. 88 Hours of Work in the Philippines Normal hours of work in the Philippines The normal hours of work of any employee shall not exceed eight hours a day. prepared by: Lyle De la Cerna. 89 Hours of Work in the Philippines Normal hours of work in the Philippines Hours worked shall include all time during which an employee is required to be on duty or to be at a prescribed workplace and all time during which an employee is suffered or permitted to work. Rest periods of short duration during working hours shall be counted as hours worked. prepared by: Lyle De la Cerna. 90 Weekly Rest Periods Right to weekly rest day It shall be the duty of every employer, whether operating for profit or not, to provide each of his employees a rest period of not less than 24 consecutive hours after every six consecutive normal work days. prepared by: Lyle De la Cerna. 91 Holidays, Service Incentive Leaves and Service Charges Right to holiday pay Every worker shall be paid his regular daily wage during regular holidays, except in retail and service establishments regularly employing less than 10 workers; prepared by: Lyle De la Cerna. 92 Holidays, Service Incentive Leaves and Service Charges Right to holiday pay The employer may require an employee to work on any holiday but such employee shall be paid a compensation equivalent to twice his regular rate prepared by: Lyle De la Cerna. 93 Holidays, Service Incentive Leaves and Service Charges Right to holiday pay As used in this Article, "holiday" includes: January 1 > Maundy Thursday Good Friday > April 9 May 1 > June 12 Last Monday of August > November 30 December 25, > December 30 the day designated by law for holding a general election. prepared by: Lyle De la Cerna. 94 Other Laws Other Laws Occupational Safety and Health Standards Law (OSH) Sexual Harassment Law Minimum Employable Age prepared by: Lyle De la Cerna. 96 Occupational Safety and Health Standards Law (OSH) RA11058 prepared by: Lyle De la Cerna. 97 OSH Law The OSH law provides that each Filipino worker is protected against injury sickness or death through safe and healthful working conditions prepared by: Lyle De la Cerna. 98 OSH Law That employers must promote strict but: dynamic Inclusive gender-sensitive measures in the formulation and implementation of policies and programs related to occupational safety and health. prepared by: Lyle De la Cerna. 99 OSH Law It applies to all establishments, projects, sites, including Philippine Economic Zone Authority (PEZA) establishments, and all other workplaces. The exposure to safety and health hazards is the basis for having High Risk Establishments, Medium Risk Establishments, and Low Risk Establishments. prepared by: Lyle De la Cerna. 100 OSH Law With the RA 11058, employers are now required to comply with occupational safety and health standards including informing workers on all types of hazards in the workplace and having the right to refuse unsafe work, as well as providing facilities and personal protective equipment for the workers, among others. prepared by: Lyle De la Cerna. 101 Anti-sexual Harassment law An employer commits sexual harassment when a sexual favor is made as a condition for hiring and for continued employment or reemployment. (Section 3, RA 7877) prepared by: Lyle De la Cerna. 102 Minimum Employable Age The minimum employable age in the Philippines is fifteen years, with the exception of some instances when a child below 15 may be hired after complying with certain conditions. (See RA 7610, Sec 12, as amended by RA 7658 and RA 9231; see also DOLE Department Order No. 65-04). prepared by: Lyle De la Cerna. 103 Employee’s Right prepared by: Lyle De la Cerna. 104 Employee’s Right Self-organization and Collective Bargaining Agreement Security of tenure and humane conditions Work days, work hours, rest days Wage and other related benefits Payment of wages prepared by: Lyle De la Cerna. 105 Employees' Right to Self- Organization. RA 875 Employees shall have the right to self- organization and to form, join or assist labor organizations of their own choosing for the purpose collective bargaining through representatives of their own choosing and to engage in concerted activities for the purpose of collective bargaining and other mutual aid or protection. prepared by: Lyle De la Cerna. 106 Employees' Right to Self- Organization. RA 875 Individuals employed as supervisors shall not be eligible for membership in a labor organization of employees under their supervision but may form separate organizations of their own. prepared by: Lyle De la Cerna. 107 Employees' Right to Self- Organization. Unfair labor practices may be committed by employers (Art 248, LCP) and by labor organizations or unions (Art 249, LCP). These rights are expressly provided by the 1987 Constitution and the Labor Code. prepared by: Lyle De la Cerna. 108 Collective Bargaining Agreement A CBA is a contract executed upon incorporating the agreements reached after negotiations with the employer and the exclusive bargaining representative of the employees with respect to wages, hours or work and all other terms and conditions of employment including proposals for adjusting any grievances or questions under such agreement. prepared by: Lyle De la Cerna. 109 Collective Bargaining Agreement As such, a CBA includes economic provisions and non- economic provisions. Economic provisions include monetary value of wage increases, loan benefits, bonuses, allowances, retirement plans, and other fringe benefits. prepared by: Lyle De la Cerna. 110 Collective Bargaining Agreement On the other hand, non-economic clauses include union security clauses, grievance procedures, labor-management cooperation schemes, and other provisions without monetary value. prepared by: Lyle De la Cerna. 111 Security of Tenure and Humane Conditions Every employee shall be assured security of tenure. No employee can be dismissed from work except for a just or authorized cause, and only after due process. Just cause refers to any wrongdoing committed by an employee; authorized cause refers to economic circumstances that are not the employee’s fault. prepared by: Lyle De la Cerna. 112 Security of Tenure and Humane Conditions Employers must provide workers with every kind of on-the- job protection against injury, sickness or death through safe and healthful working conditions. prepared by: Lyle De la Cerna. 113 Payment of Wages Wages should be paid directly to the employee in cash, legal tender, or through a bank. Wages shall be given not less than once every two weeks or twice within a month at intervals not exceeding 16 days. prepared by: Lyle De la Cerna. 114 Valid Termination of Employment prepared by: Lyle De la Cerna. 115 Valid termination of employment If you want to dismiss an employee from his job, it should be for a cause provided by law and you must comply with procedural requirements. Just causes which are voluntary acts of the employee are enumerated in Article 282 (LCP) while authorized causes, which are attributed to the employer, are provided by Article 283 and 284. prepared by: Lyle De la Cerna. 116 Valid termination of employment For a valid dismissal, substantive (Art. 282, 283, 284) and procedural requirements (Article 277b; also Department Order No. 9, June 21, 1997) must be complied with. prepared by: Lyle De la Cerna. 117 Valid termination of employment An employer may dismiss an employee on the following Just Causes: serious misconduct; willful disobedience; gross and habitual neglect of duty; fraud or breach of trust; commission of a crime or offense against the employer, his family or representative; other similar causes. prepared by: Lyle De la Cerna. 118 Valid termination of employment The other grounds are Authorized Causes: installation of labor-saving devices; redundancy; retrenchment to prevent losses; closure and cessation of business; and disease / illness. prepared by: Lyle De la Cerna. 119 Just causes a. Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work; prepared by: Lyle De la Cerna. 120 Just causes b. Gross and habitual neglect by the employee of his duties; c. Fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative; prepared by: Lyle De la Cerna. 121 Just causes d. Commission of a crime or offense by the employee against the person of his employer or any immediate member of his family or his duly authorized representatives; and e. Analogous or similar causes prepared by: Lyle De la Cerna. 122 Procedure for termination due to just causes: Twin Notice Rule 1. Serve the first written notice on the employees containing the specific ground/s for termination and a directive that they are given the opportunity to submit their written explanation within a reasonable period. prepared by: Lyle De la Cerna. 123 Procedure for termination due to just causes: Twin Notice Rule 2. After serving the first notice, the employers should schedule and conduct a hearing or conference wherein the employees will be given the opportunity to: a) explain and clarify their defenses to the charge against them; b) present evidence in support of their defenses; and c) rebut the evidence presented against them by the management. prepared by: Lyle De la Cerna. 124 Procedure for termination due to just causes: Twin Notice Rule 3. After determining that termination of employment is justified, the employers shall serve the employees a written notice of termination indicating that: a) all circumstances involving the charge against the employees have been considered; and b) grounds have been established to justify the severance of their employment prepared by: Lyle De la Cerna. 125 Authorized causes 1. Installation of labor saving device 2. Redundancy 3. Retrenchment to prevent losses 4. Closure due to serious business losses 5. Disease prepared by: Lyle De la Cerna. 126 Installation of labor saving device The installation of these devices is a management prerogative and the courts will not interfere with its exercise in the absence of abuse of discretion, arbitrariness, or malice on the part of management. https://www.divinalaw.com/news-and-updates/authorized-causes/ prepared by: Lyle De la Cerna. 127 Installation of labor saving device Installation of labaor-saving device will result in making positions being held by employees who will be adversely affected thereby redundant and unnecessary. https://www.divinalaw.com/news-and-updates/authorized-causes/ prepared by: Lyle De la Cerna. 128 Redundancy Redundancy exists when the services of an employee are in excess of what is reasonably demanded by the actual requirements of an enterprise. This happens when the position is superfluous because of a number of factors such as over-hiring of workers, decreased volume of business, dropping of a particular product line or service activity previously manufactured or undertaken by the enterprise or phasing out of service activity priorly undertaken by the business. prepared by: Lyle De la Cerna. 129 Retrenchment to prevent losses Retrenchment has been defined as “the termination of employment initiated by the employer through no fault of the employees and without prejudice to the latter, resorted to by management during periods of business recession, industrial depression, or seasonal fluctuations; prepared by: Lyle De la Cerna. 130 Retrenchment to prevent losses or during lulls occasioned by lack of work or orders, shortage of materials; or considerable reduction in the volume of employer’s business, conversion of the plant for a new production program or the introduction of new methods or more efficient machinery, or of automation. Proof of losses or possible imminent losses is the distinctive requisite of retrenchment. prepared by: Lyle De la Cerna. 131 Closure due to serious business losses Closure or cessation of business is the complete or partial cessation of the operations or shutdown of the establishment of the employer. It is carried out to stave off the financial ruin or promote the business interest of the employer. prepared by: Lyle De la Cerna. 132 Disease Disease is also of one the authorized causes to terminate employment. However, not all kinds of disease may be considered as a valid ground to terminate employment. prepared by: Lyle De la Cerna. 133 Disease It must be proven that an employee’s continued employment is prohibited by law or prejudicial to his health as well as to the health of his co-employees. Further, a competent public health authority must issue a medical certificate that the disease is of such nature or at such a stage that it cannot be cured within a period of six (6) months even with proper medical treatment. prepared by: Lyle De la Cerna. 134 Conclusion The key to avoiding violations of labor and employment laws is: by being a good employer – that is, giving your employees at least the minimum benefits and standard working conditions provided by law, by allowing them to reasonably exercise their rights as workers, especially the right to self-organize and by always exercising good faith and fairness in dealing with them. prepared by: Lyle De la Cerna. 135 Conclusion As employer, you must not only think of the profit you can earn from your business, but also the human factor in every employment relationship. prepared by: Lyle De la Cerna. 136 THANK YOU prepared by: Lyle De la Cerna. 137 https://www.ecomparemo.com/info/heres-a-full-list-of- mandatory-benefits-for-regular-employees-in-the- philippines prepared by: Lyle De la Cerna. 138

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