Legal Aspects of Tourism & Hospitality PDF

College of Business and Management The Actual Workplace Legal Aspects of Tourism and Hospitality  Labor Law, Labor Standards Employer Includes: 1. One who employs the services of others; one for whom employees work and wh...

College of Business and Management The Actual Workplace Legal Aspects of Tourism and Hospitality  Labor Law, Labor Standards Employer Includes: 1. One who employs the services of others; one for whom employees work and who pays their wages or salaries (IRR of the Labor Code, Book V, Rule 1. Section 1 (s), as amended by D.O. No. 40-03) 2. Any person acting in the interest of an employer, directly or indirectly. The term shall not include any labor organization or any of its officers or agents except when acting as employer. (Labor Code, Article 219, para. e  Labor Law, Labor Standards Employee Includes: 1. One who has been dismissed from work but the legality of the dismissal is being contested in a forum of appropriate jurisdiction (D.O. No. 40- 03, March 15, 2003) 2. Any individual whose work has ceased as a result of or in connection with any current labor dispute or because of any unfair labor practice if he has not obtained any other substantially equivalent and regular employment; and 3. Any person in the employ of an employer. (Labor Code, Art. 219, para f)  Test to determine existence of Employer-Employee Relationship 1. Selection and engagement of the employee; 2. Payment of wages; 3. Power of dismissal; and, 4. Power to control Kinds of Employment Regular Employment Employment arrangement where the employee: 1. Has been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer; (NATURE OF WORK TEST) 2. Has rendered at least 1 year of service, whether such service is continuous or broken, with respect to the activity in which he is employed; (PERIOD OF SERVICE TEST) 3. When an employee is allowed to work after a probationary period. (PROBATIONARY EMPLOYMENT TEST) Casual Employment Where an employee is: 1. Engaged to perform a job, work or service merely incidental to the business of the employer; 2. Such job, work or service is for a definite period; 3. Such employment status is made known to the employee at the time of the engagement. a. If employed for a continuous or broken period of at least 1 year, he is deemed regular but only with respect to the activity he is employed and as long as such activity exists. b. A casual employee is only casual for one year, and it is the passage of time that gives him a regular status. Kinds of Employment Contractual Employment Their employment is governed by the contracts they sign every time they are rehired. Their employment is terminated when the contract expires. Project Employment When the employment: 1. Has been fixed for a specific project or undertaking; 2. The completion or termination of which has been determined at the time of the engagement of the employee. Kinds of Employment Seasonal Employment Employment arrangement where an employee: 1. Engaged to work during a particular season; 2. Activity is usually necessary or desirable in the usual business or trade of the employer Temporary or Fixed-Term Employment arrangement where the employee: 1. Engaged to work on a specific project or undertaking; 2. Work is usually necessary or desirable in the usual business or trade of employer 3. The completion of which has been determined at the time of the engagement of the employee. Kinds of Employment Probationary Where the employee: 1. Made to undergo a trial period; generally, 6 months 2. During which the employer determines his fitness to qualify for regular employment.  Covered Employees/Workers The working conditions prescribed in the Labor Code apply to all employees in all establishments, whether for profit or not, except: DOMESTIC HELPERS 01 GOVERNMENT (KASAMBAHAYS) EMPLOYEES EXCEPT WEEKLY REST DAY AND SERVICE MANAGERIAL 02 06 INCENTIVE LEAVE EMPLOYEES OFFICERS AND PERSON IN THE PERSONAL 03 07 SERVICE OF ANOTHER; MEMBERS OF THE MANAGERIAL STAFF AND 04 FIELD PERSONNEL 08 WORKERS BY RESULTS MEMBERS OF THE 05 FAMILY OF THE EMPLOYER WHO ARE DEPENDENT ON HIM FOR SUPPORT HOURS OF WORK Normal hours of work; hours worked GENERAL RULE: The prescribed maximum hours of work under normal conditions is eight hours a day. Since the law prescribes the maximum, the employer is free to adopt a regular work schedule of less than 8 hours a day. The term “day” as used in the law refers to the 24-hour period. HOURS OF WORK Normal hours of work; hours worked CONSIDERED AS HOURS OF WORKED: 1. All time during which an employee is required to be on duty or to be at the employer’s premises or to be at a prescribed work place; 2. All time during which an employee is suffered or permitted to work; (IRR Labor Code, Book III, Rule I, Sec. 3) and 3. Rest periods of short duration during working hours. (Philippine Airlines v. NLRC, G.R. No. 132805, 1999). 4. If standby is for emergency work, meal break is part of hours worked. (PanAmerican World Airways System Philippines v. Pan-American Employees Association, G.R. No.L16275, 1961) HOURS OF WORK Normal hours of work; hours worked WHEN EMPLOYEE IS ON CALL: 1. Is required to remain on call in the employer’s premises or so close thereto; or 2. Cannot use the time effectively and gainfully for his own purpose (IRR Labor Code, Sec. 5(b), Rule 1, Book III) HOURS OF WORK Normal hours of work; hours worked WAITING TIME IS CONSIDERED HOURS WORKED IF: 1. Waiting is an integral part of his work; or 2. The employee is required or engaged by the employer to wait. 3. Employee is required to remain on call in the employer's premises or so close thereto that he cannot use the time effectively or gainfully for his own purpose. (IRR Labor Code, Sec. 5(a), Rule 1, Book III) HOURS OF WORK Meal Periods GENERAL RULE: Meal periods are NOT compensable. Meal periods should not be less than 60 minutes. (Labor Code, Art. 85) HOURS OF WORK Meal Periods EXCEPTIONS: 1. Where the lunch period or meal time is predominantly spent for the employer’s benefit; 2. Meal periods of 1hour are deemed compensable when the employee is on continuous shift (National Dev’t Corp. v. CIR, G.R. No. 15422, 1962) 3. Shortened meal period of less than 1 hour must be compensable (IRR Labor Code, Book III, Rule 1, Sec. 7) HOURS OF WORK Meal Periods 4. Meal period of not less than 20 minutes in the following cases are compensable hours worked: a. Where the work is non-manual work in nature or does not involve strenuous physical exertion; b. Where the establishment regularly operates not less than 16 hours a day; c. 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; and d. Where the work is necessary to prevent serious loss of perishable goods (IRR Labor Code, Book III, Rule 1, Sec. 7) HOURS OF WORK Night Shift Differential Every employee shall be paid a night shift differential of not less than 10% of his regular wage for each hour of work performed between ten o’clock in the evening (10 pm) and six o’clock in the morning (6 am). (Labor Code, Art. 86) HOURS OF WORK Overtime work Conditions to be entitled to OT pay: 1. Actual rendition of OT work 2. Submission of sufficient proof that said work was actually performed (Cagampan v. NLRC, G.R. No. 85122- 24, 1991) 3. OT work is with the knowledge and consent of the employer HOURS OF WORK Overtime work OVERTIME WORK RATE 1. For ordinary working day - employee is paid an additional compensation equivalent to his regular wage plus at least 25% thereof. (Labor Code, Art. 87) 2. For holiday or rest day - employee is paid an additional compensation equivalent to the rate of the first eight hours on a holiday or rest day plus at least 30% thereof. (Labor Code, Art. 87) HOURS OF WORK Compressed work week, flexible work arrangement alternative work arrangements, telecommuting program. The compressed workweek is considered as an exception to the 8-hour a day requirement under the Labor Code HOURS OF WORK Compressed work week, flexible work arrangement alternative work arrangements, telecommuting program. Compressed Workweek Refers to one where the normal workweek is reduced to less than six (6) days but the total number of work-hours of 48 hours per week shall remain. The normal workday is increased to more than eight hours but not to exceed twelve hours, without corresponding overtime premium. The concept can be adjusted accordingly depending on the normal workweek of the company pursuant to the provisions of Department Advisory No: 02. series of 2004, dated 2 December 2004 HOURS OF WORK Compressed work week, flexible work arrangement alternative work arrangements, telecommuting program. Reduction of Workdays Refers to one where the normal workdays per week are reduced but should not last for more than six months, HOURS OF WORK Compressed work week, flexible work arrangement alternative work arrangements, telecommuting program. Rotation of Workers Refers to one where the employees are rotated or alternately provided work within the workweek. HOURS OF WORK Compressed work week, flexible work arrangement alternative work arrangements, telecommuting program. Forced Leave Refers to one where the employees are required to go on leave for several days or weeks utilizing their leave credits if there are any. HOURS OF WORK Compressed work week, flexible work arrangement alternative work arrangements, telecommuting program. Broken-time schedule Refers to one where the work schedule is not continuous but the work-hours within the day or week remain HOURS OF WORK Compressed work week, flexible work arrangement alternative work arrangements, telecommuting program. Flexi-holidays schedule Refers to one where the employees agree to avail the holidays at some other days provided there is no diminution of existing benefits as a result of such arrangement. HOURS OF WORK Rest Periods The rest day is the period of inactivity of not less than twenty-four consecutive hours given to an employee after rendering service for a week. The right of choice belongs to the employer. However, the preference of the employee should be respected if it is based on religious grounds. HOURS OF WORK Rest Periods GENERAL RULE: The preference of the employee should be respected if it is based on religious grounds. The employee shall make known his preference to the employer in writing at least seven (7) days before the desired effectivity of the initial rest day so preferred. (IRR Labor Code, Sec. 4, Rule III, Book III) HOURS OF WORK Rest Periods EXCEPTION: If such choice of employee will prejudice the operations or undertaking of the employer, the employer may schedule the weekly rest day of his choice for at least two days in a month. (IRR Labor Code, Sec. 4, Rule III, Book III) HOURS OF WORK Rest Periods REMUNERATION FOR WORKING ON A REST DAY Regular Pay + Premium pay (30% of regular remuneration) HOURS OF WORK Holidays Payment of the regular daily wage for any unworked regular holiday. Covered: All employees who perform work on regular workdays are entitled to receive holiday pay as mandated by the government. HOURS OF WORK Holidays Not Covered: 1. Employees for retail and service companies with less than ten (10) regular employees 2. Managerial employees 3. Managerial staff members and officers 4. Government employees 5. Domestic helpers 6. Employees engaged on task, contract, or purely commission basis HOURS OF WORK Holidays Special Circumstances of Holiday Pay SEASONAL WORKERS Not entitled during off-season when they are not at work WORKERS WHO ARE PAID BY OUTPUT OR BY RESULT Holiday pay shall be less than his average daily earnings for the last 7 actual working days preceding the regular holiday HOURS OF WORK Holidays Special Circumstances of Holiday Pay WORKERS WHO HAVE NO REGULAR WORKING Entitled to holiday pay PRIVATE SCHOOL TEACHERS Entitled only on Christmas break but NOT semestral vacations SUPERVISED WORKERS PAID BY RESULTS Entitled HOURS OF WORK Holidays EFFECT OF ABSENCES: On leave with pay- entitled On leave w/o pay on the day immediately preceding GENERAL RULE: Not entitled EXCEPTION: Worked on regular holiday On leave with SSS or EC benefits-entitled If the day preceding holiday is a non-working day- entitled if worked the day immediately preceding the non-working day. HOURS OF WORK Holidays Successive Holiday Rule: General Rule: If absent on day preceding the first holiday, not entitled Exception: Worked on the first holiday, entitled to holiday pay for the 2nd HOURS OF WORK Holidays DOUBLE HOLIDAY RULE: If worked- 300% If unworked- 200% If it falls on a rest day- 390% HOURS OF WORK Holidays FLEXI-HOLIDAY SCHEDULE: Employee agrees to avail of holidays at some other days provided there is no diminution of existing benefits. Computation of Holiday Pay Scenario Not Worked Regular Holiday 100% Salary Special Non-Working Holiday General Rule: No Work, No pay Applies Exception: CBA or Contract declares otherwise Special Working Holiday General Rule: No Work, No pay Applies Exception: CBA or Contract declares otherwise Not Worked Computation of Holiday Pay Scenario Worked Regular Holiday (Basic Wage + COLA) X 200% Special Non-Working Holiday (Basic Wage X 130%) + COLA Special Working Holiday (Basic Wage X 130%) + COLA Worked Computation of Holiday Pay Scenario Worked and rendered overtime Regular Holiday (Hourly Rate X 200% X 130% X Number of Hours Worked) Special Non-Working Holiday (Hourly Rate X 130% X 130% X Number of Hours Worked) Special Working Holiday (Hourly Rate X 130% X 130% X Number of Hours Worked) Worked and rendered overtime Computation of Holiday Pay Scenario Full shift on their rest day Regular Holiday ((Basic Wage + COLA) X 200%) + (30% (Basic Pay X 200%)) Special Non-Working Holiday (Daily Rate X 150%) + COLA Special Working Holiday ((Basic Wage X 150%) + COLA) Full shift on their rest day Computation of Holiday Pay Scenario Worked overtime on a rest day Regular Holiday (Hourly Rate X 200% X 130% X 130% X Number of Hours Worked) Special Non-Working Holiday (Hourly Rate X 150% X 130% X Number of Hours Worked) Special Working Holiday (Hourly Rate X 150% X 130% X Number of Hours Worked) Worked overtime on a rest day Declared Dates for Regular Holidays (2022) January 1 April 14 April 15 New Year's Day Maundy Good Friday Thursday April 09 May 01 May 13 Araw ng Labor Eid'l Fitr Kagitingan Declared Dates for Regular Holidays (2022) June 12 August 30 November 30 Independence National Heroes Bonifacio Day Day Day December 25 December 30 Christmas Day Rizal Day Declared Dates for Special Non-Working (2022) February 01 February 25 April 16 EDSA People Chinese New Power Revolution Black Saturday Year Anniversary August 21 December 08 November 01 Feast of the Ninoy Aquino All Saint's Day Immaculate Day Conception of Mary Declared Dates for Special Working (2022) November 02 December 24 December 31 All Soul's Day Christmas Eve last day of the year HOURS OF WORK Service Charges All service charges collected by hotels, restaurants and similar establishments shall be distributed completely and equally among the covered employees except managerial employees. (Labor Code, Art. 96, as amended by RA 11360) HOURS OF WORK Service Charges BASIS OF THE AMOUNT The average monthly share of each employee for the past 12 months immediately preceding the abolition of withdrawal of the charges. (IRR Labor Code, Sec. 5, Rule VI, Book 3) HOURS OF WORK 13th Month Pay General rule: All employers are required to pay all their rank- and-file employees, a 13th month pay not later than December 24 of every year, provided that they have worked for at least 1 month during a calendar year. HOURS OF WORK 13th Month Pay Exceptions to the coverage of 13th month pay: 1. Government and any of its political subdivisions, including GOCCs, except those corporations operating essentially as private subsidiaries of the Government; 2. Employers already paying their employees 13th month pay or more in a calendar year or its equivalent at the time of issuance of PD 851 HOURS OF WORK 13th Month Pay Exceptions to the coverage of 13th month pay: 3. Employers of household helpers and persons in the personal service of another in relation to such workers 4. Employers of those who are paid on commission, boundary, or task basis, and those who are paid a fixed amount for performance of a specific work, irrespective of the time consumed in the performance thereof HOURS OF WORK 13th Month Pay EXCEPTION TO EXCEPTION: Where the workers are paid on a piece-rate basis, in which case the employer shall grant the required 13th month pay to such workers. HOURS OF WORK 13th Month Pay WHAT ARE DEEMED EQUIVALENT OF 13TH MONTH PAY? 1. Christmas bonus 2. Mid-year bonus 3. Cash bonus 4. Other payments amounting to not less than ½ of the basic salary  Wages Remuneration of earnings, however designated Capable of being expressed in terms of money, whether ○ Fixed, or ○ Ascertained on a Time, Task, Piece, or Commission basis, or Other method of calculating the same 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  Wages Includes the fair and reasonable value, as determined by the secretary of labor and employment, of ○ Board, ○ Lodging, or ○ Other facilities customarily furnished by the employer to the employee “Fair and reasonable value “shall not include any profit ○ To the employer, or 30 ○ To any person affiliated with the employer  Payment of Wages FORMS OF PAYMENT No employer shall pay, even when expressly requested by the employee, by means of 1. Promissory notes; 2. Vouchers; 3. Coupons; 4. Tokens; 5. Tickets; 6. Chits; or 7. Any object other than legal tender (Art 102, Labor Code  Payment of Wages TIME OF PAYMENT Wages shall be paid: At least once every 2 weeks, or Twice a month at intervals not exceeding 16 days EXCEPT: Immediately after event of force majeure or circumstances beyond the employer’s control have ceased, if payment on or within time provided cannot be made Facilities vs. Supplements DEFINITION OF FACILITIES Facilities are items of expense necessary for the laborer’s and his family’s existence and subsistence so that by express provision of law, they form part of the wage and when furnished by the employer are deductible therefrom, since if they are not so furnished, the laborer would spend and pay for them just the same. It includes articles or services for the benefit of the employee or his family but shall not include tools of the trade or articles of service primarily for the benefit of the employer or necessary to the conduct of the employer's business. (Book III, Rule VII, Sec. 5) Facilities vs. Supplements DEFINITION OF SUPPLEMENTS Supplements constitute extra remuneration or special privileges or benefits given to or received by the laborers over and above their ordinary earnings or wages, which include but are not limited to (Atok-Big Wedge Assn. v. Atok-Big Wedge Co., 97 Phil 294, 1955):  Facilities vs. Supplements Facilities: Necessary items of expense, articles, or services. Supplements: Extra remuneration or special privileges/ benefits/ articles/ tools of the trade. Facilities: For the benefit of the employee and his family; for their existence and subsistence. Supplements: For the benefit or convenience of the employer.  Facilities vs. Supplements Facilities: Part of the wage. Supplements: Not wage deductible Facilities: Deductible from the wage. Supplements: Not wage deductible.  Minimum Wage A legal mandate for employers to pay their employees a compensation which should not be less than that prescribe by the Regional Tripartite Wages and Productivity Board in the different regions  Wage Distortion A situation where an increase in prescribed wage rates results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical bases of differentiation.  Wage Distortion ELEMENTS OF WAGE DISTORTION (PRUBANKERS ASSOCIATION V. PRUDENTIAL BANK & TRUST COMPANY, GR NO. 131247, 1999) 1. An existing hierarchy of positions with corresponding salary rates 2. A significant change in the salary rate of a lower pay class without a concomitant increase in the salary rate of a higher one 3. The elimination of the distinction between the two levels 4. The existence of the distortion in the same region of the country  LEAVES Service Incentive Leaves Who Are Entitled to SIL? GENERAL RULE: All employees EXCEPTION: 1. Government employees, whether employed by the National Government or any of its political subdivisions, including those employed in GOCCs with original charters or created under special laws; 2. Domestic helpers and persons in the personal service of another 3. Managerial Employees 4. Officers or members of a managerial staff.  LEAVES Service Incentive Leaves EXCEPTION: 5. Field personnel and other employees whose performance is unsupervised by the employer including those who are a. Engaged on task or contract basis b. Purely commission basis or; c. Those who are paid a fixed amount for performing work irrespective of the time consumed. 6. Already enjoying the benefit 7. Enjoying vacation leave with pay of at least five (5) days 8. Employed in establishments regularly employing less than ten (10) employees  LEAVES Expanded Maternity Leave Coverage of grant of Maternity leave in Government and Private Sector All covered female workers in government and the private sector, including those in the informal economy, regardless of civil status or the legitimacy of her child (RA 11210, Sec. 3) Coverage of grant of Maternity leave in Government and Public-Sector Any pregnant female worker in the government service, regardless of employment status, in 1. National Government Agencies (NGAs), Local Government Units (LGUs), 2. Government-Owned or -Controlled Corporations (GOCCs), or 3. State Universities and Colleges (SUCs) (RA 11210, Sec. 4)  LEAVES Expanded Maternity Leave Maternity Leave Benefit for workers in Government, Private or Public Sector 1. (105) days maternity leave with full pay 2. Optional (30) days without pay: 3. Additional (15) days maternity leave with full pay if the worker qualifies as a solo parent under Republic Act No. 8972, or the "Solo Parents’ Welfare Act".  LEAVES Paternity Leave Conditions to Entitlement 1. A married male employee at the time of delivery of his child; 2. Cohabiting with his spouse at the time she gives birth or suffers a miscarriage; 3. Applied for paternity leave within a reasonable period from the expected date of delivery by the pregnant spouse, or within such period as may be provided by company rules or by CBA; provided that prior application is not required in case of miscarriage; 4. Wife has given birth or suffered a miscarriage. 5. Where a male employee is already enjoying the paternity leave benefits by reason of contract, company policy or CBA, the greater benefit prevails.  LEAVES Parental Leave for Solo Parents Who are Solo Parents? 1. A parent left alone with the responsibility of parenthood because of the death of one’s spouse. 2. A parent left alone with the responsibility of parenthood because of any physical and/or mental incapacity of one’s spouse as certified by a public medical practitioner 3. A parent left alone with the responsibility of parenthood because one has legally separated from his spouse or because they have been separated for at least one year and the child is in solo parent’s custody  LEAVES Parental Leave for Solo Parents Who are Solo Parents? 4. A parent left alone with the responsibility of parenthood because the marriage was annulled by a court or a church decree, and the child is in solo parent’s custody. e. A parent left alone with the responsibility of parenthood because his spouse abandoned him for at least one year. 5. A parent left solo or alone with the responsibility of parenthood because his spouse is detained or is serving sentence for a crime for at least one year. 6. An unmarried mother or father who has preferred to keep and rear the child himself, instead of having others care for them or give up to a welfare institution.  LEAVES Parental Leave for Solo Parents Who are Solo Parents? 7. Solely provides parental care and support to a child or children. 8. Assumes responsibility of head of the family as a result of the death, abandonment, disappearance or prolonged absence of the children’s parents or solo parent. 9. A victim of rape and/or other crimes against chastity, have given birth to a child as a result and have decided to keep and raise his child. (R.A. No. 8972, Sec. 3(a))  LEAVES Parental Leave for Solo Parents Condition for Entitlement of Parental Leave 1. He/she has rendered at least 1 year of service, whether continuous or broken; 2. He/she has notified his/her employer of the availment thereof within a reasonable period 3. He/she has presented a Solo Parent Identification Card to his/her employer which may be obtained from the DSWD office of the city or municipality where he/she resides (IRR of R.A. No. 8972, Sec. 19)  LEAVES LEAVE BENEFITS FOR WOMEN WORKERS UNDER R.A. NO. 9710 AND R.A. NO. 9262 RA 9710: Magna Carta Special Leave Benefit or Surgical Leave Sec. 18 RA 9710 provides that a woman employee having rendered continuous aggregate employment service of at least 6 months for the last 12 months shall be entitled to a special leave benefit of 2 months with full pay based on her gross monthly compensation following surgery caused by gynecological disorders.  LEAVES RA 9262: Leaves for Victims of Violence Against Women and their Children (VAWC) Violence against women and their children (VAWC) refers to any act or a series of acts committed by any person against a woman who is his wife, former wife, or against a woman with whom the person has or had a sexual or dating relationship, or with whom he has a common child, or against her child whether legitimate or illegitimate, within or without the family abode, which result in or is likely to result in physical, sexual, psychological harm or suffering, or economic abuse including threats of such acts, battery, assault, coercion, harassment or arbitrary deprivation of liberty (Sec 3(a), R.A. 9262).  KASAMBAHAY (RA 10361) Coverage All kasambahay engaged in domestic work, whether on a live-in or live-out arrangement, such as, but not limited to, the following: 1. General househelp; 2. Nursemaid or yaya; 3. Cook; 4. Gardener; 5. Laundry person; 6. Working children or domestic workers 15 years and above but below 18 years of age; or 7. Any person who regularly performs domestic work in the household on an occupational basis. (Sec. 3 (d), R.A. 10361) KASAMBAHAY (RA 10361) Persons NOT covered by the Batas Kasambahay: 1. Service providers; 2. Family drivers; 3. Children under foster family arrangement; and 4. Any other person who performs work occasionally or sporadically and not on an occupational and regular basis.  College of Business and Management Thank You For Your Attention