labor BQ 2003

[bleuchiz]

2003 Bar Questions

I. 5%

May social justice as guiding principle in labor law be so used by the court in sympathy with the working man if it collides with the equal protection clause of the Constitution? Explain.

Suggested Answers:


Yes. The State is bound under the Constitution to afford full protection to Labor; and when conflicting interests collide and they to be weighed on the scales of social justice, the law should accord more sympathy and compassion to the less privileged workingman (Fuentes v. NLRC, 266 SCRA 24, 1997). However, if should be borne in mid that social justice ceases to be an effective instrument for the “equalization of the social and economic forces: by the State when it is used to shield wrongdoing (Corazon Jamer vs. NLRC, 278 SCRA 632, 1997).

Alternative Answer:

No, social justice as guiding principle in law may not be used by the courts if it collides with the equal protection clause of the Constitution. Social justice is not a magic wand applicable in all circumstances. No all labor cases will be automatically decided in favor of the worker. Management has also rights which are entitled to recognition and protection; justice must be dispensed according to facts and law; and social justice is not designed to destroy or oppress the employer.


II. 8%

Pablo was a farm-hand in a plantation owned by ABC & Co., working approximately 6 days a week for a good 15 years. Upon Pablo’s death, his widow filed a claim for burial grant and pension benefits with the SSS. The claim was denied on the ground that Pablo had not been a registered member-employee. Pablo’s widow filed a petition before the SSS asking that his name be reported for SSS coverage. ABC & Co. countered that Pablo was hired to plow, harrow and burrow, using his own carabao and other implements and following his own schedule of work hours, without any supervision from the company. If proven, would this factual setting advanced by ABC & co. be a valid defense against the petition?

Suggested Answer:

ABC & Co. has a valid defense.

Pablo should be an employee of ABC & Co. to be under the compulsory coverage of the SSS. To be an employee, Pablo should be under the control of ABC & Co. as regards his employment. But the facts show that he was not under the control of ABC &Co. as regards his employment. Among others, he had his own schedule of work hours, without any supervision from the company. Thus, he is an independent contractor and not an employee. An independent contractor is not under the compulsory coverage of the SSS. He maybe covered as a self-employed person. But then as such, ABC & Cp. Has no legal obligation to report Pablo for coverage under the SSS because ABC &Co. is not Pablo’s employer.

Another Suggested Answer:

It is not a valid defense, for Pablo could be considered an employee of ABC &Co. The elements of hiring, payment of wages, power to dismiss and power to control are presumed form the fact that Pablo is working 6 days a week, for 15 years now. Pablo’s use of his plow, harrow, burrow, carabao and other implements and his having his own schedule of work hours without any supervision from the company do not erase the element of control on the part of ABC & Co. because under the “control test” it is enough that the employer’s right to control exists. It is not necessary that the same be exercised by the employer, it enough that such right to control exists (Religious of the Virgin Mary vs. NLRC, 316 SCRA 614, 1999).

III. 5%

In a labor dispute, the Secretary of Labor issued an “assumption Order”. Give the legal implications of such an order.

Suggested Answer:

Under Article 263 (g) of the Labor Code, such assumption shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption order. If one had already taken place at the time of assumption, all striking or lockout employees shall immediately return to work and the employer shall immediately resume operations and re-admits all workers under the same terms and conditions prevailing before the strike or lockout. The Secretary of Labor and Employment may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same. The mere issuance of an assumption order by the Secretary of Labor automatically carries with it a return-to-work order, even if the directive to return to work is not expressly stated in the assumption order. Those who violate the foregoing shall be subject to disciplinary action or even criminal prosecution.

Under Article 264 of the Labor Code, no strike or lockout shall be declared after the assumption of jurisdiction by the Secretary.

IV. 8%

Magdalo, a labor union in Aokwood, a furniture manufacturing firm, after failing in its negotiations with Oakwood, filed with the DOLE a notice of strike. The DOLE summoned Magdalo and Oakwood for conciliation hearing to resolve the deadlock. Unable to agree despite efforts of the DOLE, Magdalo called a strike participated in by its officers and union members including Cesar Trinio, a rank-and-file employee, who led the “Walk out.” Oakwood filed a petition to declare illegal the strike which Magdalo staged without observing the seven-day ban under the Labor Code. Oakwood claimed that the strike being illegal, all those who participated therein, including Cesar Trinio, could be dismissed as, in fact, they were so dismissed by Oakwood. Decide the case.

Suggested Answer:

When Oakwood dismissed all the officers and members of the union who participated in the strike which was declared illegal because it was staged without observing the seven-day ban under the Labor Code, Oakwood illegally dismissed the union members, including Cesar Trinio. The Labor Code provides that a union officer who knowingly participates in an illegal strike loses his employment status. Thus, the union officers were legally dismissed. But for a union member to lose his employment status, he should have committed illegal acts during the strike, like acts of violence, coercion intimidation or obstructing of ingress to or egress from the employer’s premise for lawful purposes or obstruction of public thoroughfares. The union members, including Cesar Trinio, did not commit any of these acts. Thus, it would be illegal to dismiss them.

V. 6%

The Labor Code treats differently in various aspects the employment of (i) managerial employees, (ii) supervisory employees, and (iii) rank-and-file employees. State the basic distinguishing features of each type of employment.

Suggested Answer:

Under the Labor Code, “Managerial Employee” is one who is vested with powers or prerogatives to lay down, and execute management policies and/or to hire, transfer, suspend, lay off, recall, discharge, assign or discipline employees. A supervisory employee is one who in the interest of the employer, effectively recommends such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. All employees not falling within any of the above definitions are considered rank-and-file employees for purposes of Book V of the Labor Code (Art. 212).

On the matter of right to self-organization, a managerial employee cannot exercise such right; while a supervisor and a rank and file can ( Arts. 243 and 245 of the Labor Code).


VI. 8%

A case against an employer company was filed charging it with having violated the prohibition against offsetting under time for overtime work on another day. The complainants were able to show that, pursuant to the CBA, employees of the union had been required to work “overtime” on Saturday but were paid only at regular rates of pay on the thesis that they were not required to complete, and they did not in fact complete, the eight-hour work period daily from Monday through Friday. Given the circumstance, the employer contended that the employees were not entitled to overtime compensation, i.e., with premium rates of pay. Decide the controversy.

Suggested Answer:

The employer is correct. While Article 88 of the Labor Code clearly provides that under time work on any other day, this rule is inapplicable in this case pertaining to Saturday work which in reality does not constitute overtime work as Saturday is still a working day under the law and there no CBA stipulation against it.

Another Suggested Answer:

Article 88 of the Labor Code provides that under time work on any particular day shall not be offset by overtime work on any other day. The CBA being the law between the parties and the Union having shown that the employees rendered overtime work on Saturday, the contention of the employer is not tenable. They employer cannot use the under time of Monday through Friday to offset the overtime o Saturday. Hence, the employees are entitled to overtime compensation, i.e. premium rates of pay on Saturday.

VII 5%

There are instances when a certification election is mandatory. What is the rationale for such a legal mandate?

Suggested Answer:

According to the Labor Code, in any establishment where there is no certified bargaining agent, a certification election shall automatically be conducted by the Med-Arbiter upon the filing of a petition by a legitimate labor organization.

In the abode-described situation, a certification election is made mandatory because if there is no certified bargaining agent as determined by a certification election, there could be collective bargaining in the said unorganized establishment.

VIII. 8%

The employer company, in a directive to the union president, ordered the transfer of some of its employees, including a number of union officials, to its plant offices. The order was opposed by the union. Ultimately, the union filed an unfair labor practice against the company alleging that the purported transfer of its union officials was unjust and in violation of CBA. Pursuant to the terms of the CBA, the dispute was referred to a voluntary arbitrator who later ruled on the issue raised by the parties. Could it be later be validly asserted that the “decision” of the voluntary arbitrator would no “compulsory” effect on the parties? Explain.

Suggested Answer:

No. The award of voluntary arbitrators acting within the scope of their authority determines the right s of the parties, and their decisions have sale legal effects as a judgment of the Court. Such decisions on matters of fact or law are conclusive, and all matters in the award are thenceforth re judicata on the theory that the matter has been adjudged by the tribunal which the parties have agreed to make final as tribunal of last resort (Volkschel Labor Union vs. NLRC, 98 SC RA 314, 1880).

IX. 5%

At what particular point does a labor organization acquire a legal personality?

a. On the date the agreement to organized the union is signed by the majority of the all its members; or
b. On the date the application for registration is duly filed with the DOLE;
c. On the date appearing the Certificate of Registration; or
d. On the Certification is actually issued; or
e. None of the above.

Suggested Answer:

On the date the Certification of Registration is actually issued.

Any applicant labor organization, association or group of unions or workers shall acquire legal personality and shall be entitled to the rights and privileges granted by law to legitimate labor organization upon issuance of the certificate or registration.

Another Suggested Answer:

On the date appearing the Certificate of Registration.

When the law provides that a “labor organization xxx shall acquir3e legal personality xxx upon issuance of the certificate of registration”, the date appearing therein is legally presumed – under the rule of presumption of the regularity – to be its date of issuance. Actual issuance is a contentious evidentiary issue that can hardly be resolved, not to mention that the law does not speak of “actual” issuance.

X. 8%

XYZ employees Association filed a complaint against ABC Bank for wrongful diminution of benefits. It alleged that the bank had been providing for a mid-year bonus equivalent to one-month basic pay and a Christmas bonus equivalent to one-month basic pay since 1971. Upon the effectivity of PD 851 in 1975 which granted 13th month pay, the bank started giving its employees a one-night basic pay as mid-year bonus, one-month basic pay as Christmas bonus, and one one-month pay as 13th month pay. In 1980, the bank was placed under conservatorship and by virtue of a monetary board resolution of Central Bank, the bank only gave one month basic pay mandated by PD 851, and it no longer gave its employees the tradition mid-year and Christmas bonuses. Could ABC Bank be traditional mid-year and Christmas bonuses. Could ABC Bank be compelled, given the circumstances, to continue paying its employees the traditional mid-year and Christmas bonuses in addition to the 13th month pay?

Suggested Answer:

No. the grant of a bonus is a prerogative, not an obligation, of the employer (Traders Royal Bank vs. NLRC, 189 SCRA 274, 1990). The matter of giving a bonus over and above that which is required by law is entirely dependent on the financial capability of the employer to give it (Businessday vs. NLRC, 221 SCRA 9, 1993).

XI. 5%

How do the provisions of the law on labor relations interrelate, if at all, with the provision pertaining to labor standards?

Labor relation law focuses its provisions on the collective aspects of employer-employee relationship. Its legal provisions deal with employees organizing unions and how through these unions, employees are able to have collective bargaining with their employer.

On the other hand, labor standards law focuses on the term and conditions of employment of employees as individual employees or those legal provisions dealing with wages, hours of work and other terms and conditions of employment.

There may instances when the provision of labor relations law may interrelate with provision of labor standards law. Thus, a CBA which dealt with in labor relations law may have provision that improves upon the minimum terms and conditions of employment prescribed in labor standards law, like a CBA providing for a higher minimum wage, or for the computation of a higher overtime pay or the payment of holiday pay not only for regular holidays but also for certain special holidays.

XII. 8%

Premiere Bank, a banking corporation, being the creditor-mortgagee of XYZ & Co. a garment firm, foreclosed the hypothecated assets of the latter. Despite the foreclosure, XYZ & Co., continued its business operations. A year later, the bank took business operations ceased without a declaration of bankruptcy. Jose Gaspar, an employee of XYZ & Co., was dismissed from employment due to the cessation of business of the firm. He filed a complaint against XYZ & co. and the bank. The Labor Arbiter, after hearing, so found the company liable, as claimed by Jose Gaspar, for separation pay. Premiere Bank was additionally found subsidiarily liable upon the thesis that the satisfaction of labor benefits due to the employee is superior to the right of a mortgagee of property. Was the Labor Arbiter correct in his decision?

Suggested Answer:

No. The preference of credits established in Art. 110 of the Labor Code cannot be invoked in the absence of any insolvency proceedings, declaration of bankruptcy, or judicial liquidation (DBP vs. Santos, 171 SCRA 138, 1989).


Suggested Answer:


No. What article 11- of the Labor Code establishes in not a lien but a preference of credit in favor of employees. Unlike a lien, a preference of credit does not create a charge upon any particular property of the debtor (DBP vs. Sec. of Labor, 179 SCRA 630, 1989).


XIII. 8%

Daisy’s Department Store hired Leo as a checker to apprehend shoplifters. Leo later became Chief of the Checkers Section and acquired the status of a regular employee. By way of cost-cutting measure, Daisy’s decided to abolish the entire Checkers Section. The services of Leo, along with those of his co-employees working in the same section were terminated on the same day. A month after the dismissal of Leo, Daisy’s engaged the services of another person as an ordinary checker and with a salary much lower than that which Leo used to receive. Given the above factual settings (nothing more having been established), could the dismissal of Leo be successfully assailed by him?

Suggested Answer:


Yes. Given the factual setting in the problem, and since “nothing more have been established”, the dismissal of Leo can be successfully assailed by him. This is so because the burden of proof is upon the employer to show compliance with the following requisites for reduction of personnel:

1. Losses or expected loses should be substantial and not merely de minimis;
2. The expected losses must be reasonable imminent, and such imminence can be perceived objectively and in good faith by the employer.
3. It must be necessary and likely to prevent the expected losses. The employer must have taken other measures to cut costs other than labor costs; and
4. Losses if already realized, or the expected losses must be proven by sufficiently and convincing evidence (Lopez Sugar Corp. v. Federation of Sugar Workers, 189 SCRA 179, 1990).

Moreover, the notice requirements to be given by Daisy’s Department Store to DOLE and the employees concerned 30 days prior to the intended date of termination, as well as the requisite separation pay, were not complied with.

Another Suggested Answer:

Yes. The authorized cause to dismiss due to redundancy or retrenchment under article 283 of the Labor Code has been disproved by Daisy’s engaging the services of a substitute checker at a salary much lower than that which Leo used to receive. Also, it appears that the one month notice rule required is said law was not complied with. Such being the required in said law was not complied with. Such being the case, the twin requirements for a valid dismissal under Articles 277 (b) and 283 of the Code have clearly not been complied with. That no separation pay was paid Leo, in violation of Article 283 of the Code, his dismissal can all the more be successfully assailed.

XIV 8%

Oscar Pimentel was an agent supervisor, rising from the ranks, in a corporation engaged in real estate. In order to promote the business , the company issued a memorandum to all agent supervisors requiring them to submit a feasibility study within their respective areas of operation. All agent supervisors complied except Oscar. Reminded by the company to comply with the memorandum, Oscar explained that being a drop-out in school and uneducated, he would be unable to submit the require study. The company found the explanation unacceptable and terminated his employment. Aggrieved, Oscar filed a complaint for illegal dismissal against the company. Decide the case.

For failure to comply with the memorandum to submit a feasibility study on his area of operation, Oscar can not be terminated (presumably for insubordination or willful disobedience) because the same envisages the concurrence of at least two requisites: 1. the employee’s assailed conduct must have been willful or intentional, the willfulness being characterized by a wrongful and perverse attitude; and 2. the order violated must have been reasonable, or lawful, made known to the employee and must pertain to the duties which he had been engaged to discharge.

In the case at bar, at least two requisites are absent, namely: 1. Oscar did not willfully disobey the memorandum with perverse attitude; and 2. the directive to make a feasibility study did not pertain to his duties. Hence, the termination from employment of Oscar Pimentel is not lawful.

XV. An individual, the sole proprietor of a business enterprise, be said to have violated the Anti-Sexual Harassment Act of 1995 if he clearly discriminates against women in the adoption of policy standards for employment and promotions in the enterprise? Explain.

Suggested Answer:

When an employer discriminates against women in the adoption of policy standards foe employment and promotion in his enterprise, he is not guilty of sexual harassment. Instead, the employer is guilty of discrimination against women employees which is declared to be unlawful by the Labor Code.

For an employer to commit sexual harassment, he – as a person of authority, influence or moral ascendancy – should have demanded, requested or otherwise required a sexual favor from his employee whether the demand, request or requirement for submission is accepted by the object of said Act.

In the question, no such act was committed by the sole proprietor.

[pinkalou]

2002 Bar Questions

I. 5%

A. State your agreement or disagreement with the following statement and explain your answer briefly: A criminal case filed against an employee does not have the effect of suspending or interrupting the running of the prescriptive period for the filing of an action for illegal dismissal.
B. State your agreement or disagreement with the following statement and explain your answer briefly: The period of prescription in Article 291 of the Labor Code applies only to money claims so that the period of prescription for other cases of injury to the rights of employees is governed by the Civil Code. Thus, an action for reinstatement for injury to an employee’s rights prescribed in four years as provided in Article 1146 of the Civil Code.

Suggested Answers:


a. I agree. The two cases, namely: the criminal case where the employee is the accused; and the case for illegal dismissal, where the employee would be the complainant, are two separate and independent actions governed by different rules, venue, and procedures. The criminal cases is within the jurisdiction of the regular courts of law and governed by the rules of procedure in criminal cases. The action for the administrative aspect of illegal dismissal would be filed with the NLRC and governed by the procedural rules of the Labor Code.

Other Suggested Answers:

I agree. An action for illegal dismissal is an administrative case which is entirely separate and distinct from a criminal action. Each may proceed independently of each other.

The right to file an action for illegal dismissal is not dependent upon the outcome of the criminal case. Guilt or innocence in the criminal case is not determinative of the existence of a just or authorized cause for a dismissal (Pepsi vs. Guanzon, 173 SCRA 571, 1989).


b. A case of illegal dismissal filed by an employee who has been terminated without a just or authorized cause is not a money claim covered by Article 291 of the Labor Code. An employee who is unjustly dismissed from work is entitle to dismissal is based upon an injury to the right to security of tenure of an employee. Thus, in accordance with Article 1146, it must be instituted within four years (International Harvester vs. NLRC, 200 SCRA, 1991).

II. 5%

Design Consultants, Inc. was engaged by the PNCC to supervise the construction of the South Expressway Extension. Designed consultants Inc. hired Omar as a driver for two years. After his two-year contract expired, he was extended another contract for nine months. These contracts were entered into during the various stages and before the completion of the extension project. Omar claims that because of these repeated contracts, he is now a regular employee of Design Consultants. IS he Correct? Explain briefly.

Suggested Answer:

Yes. The principal test for determining whether a particular employee is a “project employee” as distinguished from a “regular employee” is whether or not the “project employee” was assigned to carry out a “specific project or undertaking,” the duration and scope of which were specified at the time the employee was engaged for the projects.

In the problem given, there is no showing that Omar was informed that he was to be assigned to a “ specific project or undertaking.” Neither has it been established that he was informed for he duration and scope of such project or undertaking at the time of his engagement (Philex Mining Corp. vs. NLRC, 312 SCRA 119, 1999).

Another Suggested Answer:

Omar is not correct. Omar is a project employee as defined by Art. 280 of the Labor code. He was hired for a specific project with fixed periods of employment , specifically: two years for the first contract, and nine months for the second contract. A project employee notwithstanding an extension of the project provided that the contract of project employment clearly specifies the project and the duration thereof (Palomares vs. NLRC, 277 SCRA 439, 1997)

III. 5%

Soccorro is a clerk-typist in the Hospicio de San Jose, a charitable institution dependent for its existence on contribution and donation from well wishers. She renders work eleven hours a day but has not been given overtime pay since her place of work is a charitable institution. I Socorro entitle to overtime pay? Explain briefly.

Suggested Answer:

Yes. Soccorro is entitle to overtime compensation. She does not fall under any of the exception to the coverage of Article 82 under the provision of hours of Work. The Labor code is equally applicable to non-profit institutions. A covered employee who works beyond eight hours is entitle to overtime compensation.

IV. 5%

Pandoy, an electronics technician, worked within the premises of Perfect Triangle, an auto accessory shop. He filed a complaint for illegal dismissal overtime pay and other benefits against Perfect Triangle , which refused to pay his claims on the ground that Pandoy was not its employee but was an independent contractor. It was common practice for shops like Perfect Triangle to collect the service fees from customers and pay the same to the independent contractors at the end of each week. The auto shop explained that was like a partner who worked within is premises, using parts provided by the shop, but otherwise Pandoy was free to render service in the other auto shops. On the other had, Pandoy insisted that he still was entitle to the benefits because he was loyal to Perfect Triangle, it being a fact that he did not perform work for anyone else.. Is Pandoy correct? Explain briefly.


Suggested Answer:

Pandoy is not correct.

He is not an employee because he does not meet the four-fold test for him to be an employee of Perfect. Triangle. Pandoy was not engaged as an employee by Perfect Triangle. He was not paid by Perfect triangle. Perfect Triangle doe not have the power to dismiss him although Perfect Triangle may continue to allow him to work within its premises. And most of all, Pandoy was not under the control of Perfect Triangle as regards the work he performs for customers.



V. 6%

Name earns P7 for every manicure she does in the barber shop of a friend which has nineteen employees. At times she takes home 175 a dat and at times she earns nothing. She now claims holiday pay. Is Name entitled to this benefit? Explain briefly.

Suggested Answer:

No. Name is not entitle to holiday pay.

Article 82 of the Labor Code provides that workers who are paid by results are , among others, not entitled to holiday pay. Anemia is a worker who is paid by results.

Another Suggested Answer:

Yes. Anemia is entitle to holiday pay.

The SC has ruled : “ As to the other benefits, namely holiday pay, premium pay, 13th month pay, and service incentives leave which the labor arbiter failed to rule on but which the petitioners prayed for in their complaint, we hold that petitioners are so entitle to these benefits. Three facts lead us to conclude that petitioners, although piece rate workers, were regular employees of private respondents. First as to the nature of the petitioners, although piece rate workers, were regular employees of private respondents. First as to the nature of the petitioner’s task, their hob of repacking snack food was necessarily or desirable in the usual business of private respondents, who were engaged in the petitioner s worked for private respondents throughout the specific project or season; and third , the length of time that petitioner’s mode of compensation was on a “Per piece basis? Employees. )Labor Congress of the Phil. Vs. NLRC , 200 SCRA 1998).


VI. 5%

A. Malou is the Executive Secretary of the Senior Vice-President of a bank while Ana is the Legal Secretary of the bank’s lawyer. They and other executive secretaries would like to join the union of rank and file employees of the bank. Are they eligible to join union? Why? Explain briefly.
B. Mang Bally, owner of a shoe repair shop with only nine workers in his establishment, received proposals for collective bargaining form the Bally Shoe Union. Mang Bally Refused to bargain with the workers for several reasons. First, his shoe business is just a service establishment. Second, his workers are paid on a piecework basis (e.i, per shoe repaired) and not on a pain on a time basis. Third, he has less than then employees in the establishment. Which reason or reasons is/are tenable? Explain briefly.

Suggested Answer:


A. The following rules will govern the right of self-organization of Malou, Ana, and the other Executive Secretaries:

1. No right to Self-Organization – Confidential employees who act in a confidential capacity to persons who formulate, determine, and effectuate management policies in the filed of labor-management relation. The two criteria are cumulative and both must be met (San Miguel Corp. Vs. Laguesma, 277 SCRA 370, 1997).
2. With Right to Self-Organization – when the employee does not have access to confidential labor relations information, there is no legal prohibition against confidential employees from forming, assisting, or joining a labor organization (Sugboanon Rural Bank Inc. vs. Laguesma, 324 SCRA 425, 2001)
No rights of self-organization for legal secretaries – Legal secretaries fall under the category of confidential employees with no right to self-organization (Pier & arrastre Stevedoring Services, Inc. vs. Confesser, 241 SCRA 294, 1995).

B. None. First, Mang Bally’s shoe business is a commercial enterprise., albeit a service establishment. Second, the mere fact that the workers are paid on a piece-rate basis does not negate their status as regular employees. Payment by piece is just a method of compensation and does not define the essence of the relation (Lambo vs. NLRC, 317 SCRA 420, 1999). Third, the employees’ right to self organization is not delimited by their number.

The right to self-organization covers all persons employed in commercial, industrial and agricultural enterprise and in religious, charitable, medical, or education institutions whether operating for profit or not (Art. 243).


VII 5%

The union deducted P20 from Rogelio’s wages fro January. Upon inquiry, he learned that it was for death aid benefits and that the deduction was made pursuant to a board resolution of the directors of the union. Can Rogelio object to the deduction? Explain briefly.

Suggested Answer:

Yes. In order that the special assessment (death aid benefit) may be upheld as valid, the following requisites must be complied with: 1. Authorization by a written resolution of the majority of all the members at the general membership meeting duly called for the purpose; 2. Secretary’s record of the meeting; and 3. Individual written authorization for the check-ff duly signed by the employee concerned ( ABS CBN Supervisors Employee Union members vs. ABS CBN and Union officers, 304 SCRA 489, 1999).

In the problem given, none of the above requisite were complied with by the union. Hence, Rogelio can object to the deduction made by the union for being invalid.


VIII. 5%

Sta. Monica Plywood Corp. entered into a contract with Arnold for the milling of lumber as well as the hauling of waste wood products. The company provided the equipment and tools because Arnold had neither tools and equipment nor capital for the job. Arnold, on the other hand, hired his friends, relatives and neighbors for the job. Their wages were paid by Sta. Monica Plywood to Arnold, based on their production or the number of workers and the time used in certain areas of work. All work activities and schedules were fixed by the company.

a. Is Arnold a job contractor? Explain briefly.
b. Who is liable for the claims of the workers hired by Arnold? Explain briefly.

Suggested Answer:

A. In two cases decided by the Supreme Court, it was held that there is “job contracting” where 1. the contractor carries on an independent business and undertakes the contract work in his own account, under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof; and 2/ the contractor has substantial capital or investment in the form of tools, equipment, machineries, work premises and other materials which are necessary in the conduct of his business (Lim vs. NLRC, 303 SCRA 432, 1999; Bagnio vs. NLRC, 202 SCRA 465, 1991)

In the problem given, Arnold did not have sufficient capital or investment for one. For another Arnold was not free from the control and direction of Sta. Monica Plywood because all work activities and schedules were fixed by the company.

Therefore, Arnold is not a job contractor. He is engaged in labor-only contracting.

B. Sta. Monica Plywood is liable for the claims of the workers hired by Arnold. A finding that Arnold is a labor-only contractor is equivalent to declaring that there exist an employer-employee relationship between Sta. Monica Plywood and workers hired by Arnold. This is so because Arnold is considered a mere agent of Sta. Monica Plywood ( Lim vs. NLRC, supra).

IX. 5%

Lyric Theater Corp. issued a memorandum prohibiting all ticket sellers from encashing any check from their cash collections to the management at the end of the day. In violation of this memorandum, Melody, a ticket seller, encashed five checks from her cash collection. Subsequently, the checks were dishonored when deposited in the account of Lyric theater. For this action, Melody was placed under a 20-day suspension and directed to explain why she should not be dismissed for violation of the company’s memorandum. In her explanation, she admitted having encashed the checks without the company’s permission. While the investigation was pending, Melody filed a complaint against Lyric Theater for backwages and separation pay. The labor arbiter ordered Lyric Theater to pay Melody P115, 420.79 representing separation pay and backwages. The NLRC affirmed the ruling of the Labor arbiter. Is the ruling of the NLRC correct? Explain briefly.

Suggested Answer:

The Labor arbiter’s ruling is incorrect; the decision is premature. There was still no termination. All that was done by the employer was to place the employee under a 20-day suspension, meanwhile directing her to explain why she should not be dismissed for violation of company’s memoranda.

The order of payment of separation is also incorrect. Separation pay is only given in dismissal due to authorized causes provided for under Article 283 or payment in lieu reinstatement in case of illegal termination. None of these are present in this case.


Another Suggested Answer:

[pinkalou]

X. 8%


Suggested Answer:

Eagle star Company required a 24-hour operation and embodied this requirement in the employment contracts of its employees. The employees agreed to work on Sundays and Holidays if their work schedule required them to do so for which they would be paid additional compensation as provided by law. Last March 2000, the union filed a notice of strike. Upon Eaglestar’s petition, the Sec. of Labor certified the labor dispute to the NLRC for compulsory arbitration. On April 20, 2000 (Maundy Thursday), while conciliation meeting were pending, the union officers and members who were supposed to be on duty did not report for work. Neither did they report for work on good Friday and on black Saturday., disrupting the factory’s operation and causing it huge losses. The union denied it had gone on a strike because the days when its officers and members were absent from work were legal holidays. Is the contention of the union corr3ct? Explain briefly.

Suggested Answer:

The contention of the union is not correct.

In the case, it is clear that the employees agreed to work on Sunday and Holidays if their work schedule required them to do so for which they would be paid additional compensation as provided by law.

The above-mentioned agreement that the employees voluntarily entered into is valid. It is not contrary to law. IT is holiday s that they will be paid additional compensation as provided by law. Neither is the agreement contrary to morals, good customs, public order or public policy.

Thus, when the workers did not report for work when by agreement they were supposed to on duty, there was a temporary stoppage of work by the concerted action of the employees as a result of an industrial or labor dispute because they were on strike (Interphil Lab. Employees Union vs. Interphil. Lab Inc., GRN 142284, December 19, 2001)a


XI. 5%

Tomas and Cruz have been employed for the lass 22 years in various capacities on board the ships of BARKO Shipping Company. Their employment was made through a local manning company. They have signed several 10-month employment contracts with BARKO Shipping. The NLRC ruled that they were contractual employees and that their employment was terminated each time their contracts expired. Is the ruling of the NLRC correct?
Explain your answer fully.

Suggested Answer:

Yes. A contract of employment for a definite period terminates by its own terms at the end of such period. Since Tomas and Cruz signed 10-month contracts, their employment terminates by its own terms at the end of each 10-months period.

Stipulation in the employment contracts providing for “term employment” or “fixed period employment” are valid when the period are agreed upon knowingly and voluntarily by the parties without force, duress or improper pressure exerted on the employee; and when such stipulations were not designed to circumvent the laws on security of Tenure (Brent School vs. Zamora, 181 SCRA 702, 1990).

Moreover, in Brent school vs. Zamora, the Supreme Court stated that Article 280 of the Labor Code does not apply to overseas employment.

XII. 5%

The owners of FALCON Factory, a company engaged in the assembling of automotive components, decided to have their building renovated. Fifty persons, composed of engineers, architect and other construction workers, were hired by the company for this purpose. The work was estimated to be completed in three years. They employees contended that since the work would be completed after more than one year, they should be subject to compulsory coverage under the SSS law. Do you agree with their contentions? Explain your answer fully.




Suggested Answer:

No. Under section 8(j) of RA 1161, as amended, employment of purely casual and not for the for the purpose of the occupation or business of the employer are excepted from compulsory coverage.

An employment is purely casual if is not for the purpose of occupation or business of the employer.

In the problem given, Falcon Factory is a company engaged in the assembling of automotive components.

The fifty people were hired by Falcon Factory to remove its building. The work to be performed by these people is not in connection with the purpose of the business of the factory. Hence, the employee persons are purely casual. They are, therefore, excepted from the compulsory coverage of the SSS law.

XIII. 5%

A. As a tireman is a gasoline station, open twenty four hors a day with only five employees, Goma worked from 10 pm to 7 am of the following day. He claims he is entitled to night shift differential. Is he correct? Explain briefly.
B. On orders of his superior, Efren, a high –speed sewing machine technician worked on May 1, Labor Day. If he worked eight hours on that day, how much should he receive if his daily rate is P400?

Suggested Answer:

a. Yes. Although the implementing rules provides that the provision of night shift differential shall not be applicable to employees of retail and service establishments regularly employing not more than five worker, the right of the workers over night differential is expressly provided under Article 86 of the Labor Code. Article 86, being a substantive law, should prevail over its implementing rules in consonance with article 4 with regard in the interpretation of law. Hence, Goma, is correct in stating that he is entitled to night shift differential.

b. Efren should receive P800. Art. 92 of the labor Code provides that the employer may require an employee to work on any regular holiday but such employee shall be paid a compensation equivalent to twice his regular rate.


XIV 5%

This year, National Heroes Day (August 25) falls on a Sunday. Sunday s the rest day of Bonifacio whose daily rate is P500.

a. If Bonifacio is required by his employer to work on that of eight hours, how much should he be paid for his work? Explain.
b. If he works for 10 hours on that day, how much should he receive for his work? Explain.

Suggested Answer:

a. For working on his scheduled rest day, according to article 93, Bonifacio should be paid additional 30% of his daily rate which is equivalent to P650. This amount shall be multiplied by 2 for working on a regular holiday as article 94 provides that an employee shall be paid twice his regular rate for worn on any regular holiday. Regular rate of Bonifacio on May 1 is with an additional thirty percent because the day is also his scheduled rest day; hence, he should be paid a total of 1,300 pesos.

b. In addition to 1,300, Bonifacio will receive overtime pay equivalent to 2 hours of his rate at that time; hence we have to divide 1,300 by eight hours to determine his hourly rate which is equivalent to 162.50. This hourly rate should be multiplied by 2 and then add the same to P1, 300 with a total of 1625 pesos.


XV. 5%

a. When is illegal recruitment considered a crime of economic sabotage? Explain.
b. Is a corporation, seventy percent of the authorized and voting capital of which is owned and controlled by Filipino citizens, allowed to engage in the recruitment and placement of workers, locally or overseas? Explain.

Suggested Answer:

a. According to Article 28 of the Labor Code, illegal recruitment is deemed committee by a syndicate if carried out by a group of three or more persons conspiring and or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme which is an act of illegal recruitment.

Illegal recruitment is deemed committed in large scale if committed against three or more persons individually or as a group.

b. B. No. A corporation, seventy percent of authorized and voting capital stock of which is owned and controlled by Filipino citizens cannot be permitted to participate in the recruitment and placement of workers, locally or overseas, because Article 27 of the Labor Code requires at least seventy five percent.


XVI. 5%

a. How many times may a male employee go on Paternity Leave? Can he avail of this benefit, for example 50 days after the first delivery by his wife?
b. The projected bonus for the employees of Suerte Co. was 50% of their monthly compensation. Unfortunately, due to the slump in the business, the president reduced the bonus to 5% of their compensation of bonus? Explain.

Suggested Answer:

a. A male employee may go on Paternity Leave up to four children. ) Section 2 RA 8187). On the question of whether or not he can avail himself of this benefit 450 days after the delivery of his wife, the answer is: Yes, he can because the Rules Implementing Paternity Leave act says that the availment should not be later than 60 days after the date of delivery
b. Yes. The granting of a bonus is a management prerogative, something given in addition to what is ordinarily received by or strict due the recipient.

An employer, like Suerte Co., cannot be forced to distribute bonuses when it can no longer afford to pay. To hold otherwise would be to penalize the employer for his past generosity (Producers Bank of the Phil vs. NLRC, 355 SCRA 489, 2001).



XVII.5%

a. How should a wage distortion be resolved in case there is a collative bargaining agreement and in case there is none? Explain.
b. You were asked by a paint manufacturing company regarding the possible employment as mixer of a person, aged seventeen, who shall be directly under the care of the section supervisor. What advice would you give? Explain briefly.

Suggested Answer:

a. According to Article 124 of the labor code, in case there is a collective bargaining agreement, a dispute arising from wage distortions shall be resolved through the grievance machinery provided in the CBA, and if remains unresolved, through the voluntary arbitration. In case there is no collective bargaining agreement, the employers and workers shall endeavor to correct such distortions. Any dispute arising therefrom shall be settled through the NCMB and if it remains unresolved after 10 calendar days of conciliations, then the dispute is referred to the appropriate branch of NLRC.
b. I will advise the paint manufacturing company that is cannot hire person who is aged seventeen. Art. 139 of the labor code provides that a person below 18 years of age shall be allowed to work in an undertaking which is hazardous or deleterious in nature as determined by the Secretary of Labor. Paint manufacturing has been classified by the Secretary of Labor as a hazardous work.

XVIII 3%

A. Distinguished managerial employees from supervisory employees.
B. Do employees of a cooperative have a right to form a union? Explain briefly.


Suggested Answer:

a. A managerial employee is one who is vested with powers or prerogative to lay down and execute management policies and or to hire, transfer, suspend, lay-off, recall discharge, assign, or discipline employees. Supervisory employees, on the other hand, are those who in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. Art. 121 (m), Labor Code)

c. Employees who are members of a cooperative cannot form a union because, as members, they are owners and owners cannot bargain with themselves, however, employees who are not members of the cooperative can for a union (San Jose Electric Service Cooperative vs. Ministry of Labor, 173 SCRA 697, 1987).

XIX. 5%

A, on what ground or grounds may a union member be expelled from organization?
B. May the general manager of a company be held jointly and severally liable for backwages of an illegally dismissed employee?

Suggested Answer:

a. Union members may be expelled from the labor organization only on valid grounds provided for in the Union Constitution, By-laws or condition for union membership.
b. Yes. If it shown that the acted in bad faith, or without or in excess of authority, or was motivated by personal ill-will in dismissing the employee, the general manager may be held jointly and severally liable for the backwages of an illegally dismissed employee (ARB Construction vs. CA, 332 SCRA 427).


XX 5%

A. An employee was ordered reinstated with backwages. Is he entitiled to the benefits and incrass granted during the period of his lay-off? Explain.
B. Aside from the just cause enumerated in Article 282 of the Labor Code for the termination of employment, state three lawful or authorized caused for the dismissal of an employee.

Suggested Answer:

A. Yes. An employee who is ordered reinstated with backwages is entitled to the benefits and increase granted during the period of his lay-off. The SC has ruled that backwages are granted for earnings a worker lost due to his illegal dismissal and an employer is obliged to pay an illegally dismissed employee the whole amount of salaries plus all other benefits and bonuses and general increase to which the latter should have normally entitled had he not been dismissed (Sigma Personnel Services vs. NLRC, 224 SCRA 181, 1993).

Under the Labor Code, the lawful or authorized causes for the termination of an employee are the following:
1. Installation of labor saving device;
2. Redundancy;
3. Retrenchment to prevent losses:
4. Closing or cessation of operation of the establishment or undertaking, unless the closing is for the purpose of circumventing the provision of the labor Code.
5. Employee is suffering from any disease and whose continued employment is prohibited by law or prejudicial to his health as well as to the health of his co-employee.

[pinkalou]

2001 Bar Questions

I. 5%

Company A and union B had a 3-year CBA that expired on June 12, 1990. Negotiations proved futile so the unresolved issues were referred to an Arbiter who rendered a decision on March 15, 1992 retroactive to December 14, 1990. Is the Arbiter’s decision providing for retroactivity tenable or not? Why?

Suggested Answers:

The retroactive Order of the Labor Arbiter is void for lack of jurisdiction. Jurisdiction is conferred by law; nowhere in the Labor code, provide the authority of an arbiter to resolved cases involving unresolved issued on CBA, including the determination of the period or duration of a CBA. Hence, the decision providing the retroactivity of the CBA is not tenable.


II. 5%

A. Company A contracts out its clerical and janitorial services. In the negotiations of its CBA, the union insisted that, henceforth, the company may no longer engage in contracting out the types of services, which services the union claims to be necessary in the company’s business, without prior consultation. Is the unionis stand valid or not?

Suggested Answer:

The union’s stand is not valid. It is part of management prerogative to contract out any work, task, job or project except that is ULP to the contract our services or functions performed by union members when such will interfere with, restrain or coerce employees in the exercise of their rights to self-organization (article 248c)

B. A, an employee, sued company B for unfair labor practice, illegal dismissal and damages as a consequence thereof. The arbiter granted A’s prayer for reinstatement, backwages, and included an award for attorney’s fees. On appeal to the NLRC, the Commission affirmed the Arbiter’s decision but deleted the award for attorney’s fees since fees were not claimed in A’s complaint. Who was correct, the Arbiter or the NLRC? Why?

Suggested Answer:

The NLRC was correct in deleting the award for attorney’s fees if an employee did not include attorney’s fees among his claims and, therefore, did not give any evidence to support the payment of attorney’s fees.

c. Would your answer be different if the attorney’s fees awarded by the Arbiter were over fifteen percent of the total award? Why?


An award of attorney’s fees which is over fifteen percent of the total award is not in conformity with the provision of Labor Code stating that in cases of unlawful withholding of wages, the culpable party may be assessed attorney’s fees equivalent to 10 percent of the amount of wages recovered.

III. 5%

A worked for Company B as a rank and file employee until April 1990 when A’s services were terminated due to loss of confidence in A. However, before effecting A’s dismissal, B accorded A due process including full opportunity to answer the charges against him in the course of the investigation. Was B justified in dismissing A after the investigation? Why?

Suggested Answer:

In PLDT vs. NLRC (021199), the SC ruled that the basic requisite of dismissal on the ground of loss of confidence is that the employee concerned must be one holding a position of trust and confidence.

Rank and file employees may only be dismissed for loss of confidence if the same is because of a willful breach of trust by a rank and file employee of that trust reposed in him by his employer or duly authorized representative (art. 282c)

IV. 5%

What economic components constitute backwages for a rank and file employee? Are these components equally applicable to a managerial employee?

Suggested Answer:

The Labor code provides that an employee who is unjustly dismissed from work is entitiled to a reinstatement and also to his full backwages, inclusive of allowance, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to his actual reinstatement.

An employee is entitled to all the above benefit regardless of whether is a rank-and –file employee or a managerial employee.

However, backwages may also include the 13th months pay which are paid to rank-and file employees, as benefits arising from CBA given only to employees in the bargaining unit. Managerial employees cannot be given the same since there are ineligible to join a labor organization.


V. 5%

A was hired by company B in January 1980 until A was illegally dismissed on April 30, 1990 as found by the Labor Arbiter who ordered reinstatement and full backwages from April 30, 1990 until A’s reinstatement. The arbiter’s decision was promulgated on April 29, 1995. B appealed claiming, among others, that the award for backwages was excessive that it went beyond three-year rule set forth in Mercury Drug vs. CIR. Is B’s contention tenable? Why?

Suggested Answer:

No. The contention of B is not tenable.

RA 6715 which was enacted in 1989, in effect, set aside the three-year rule set forth in Mercury drugs vs. CIR when it provided that the full backwages shall be computed from the time his compensation was withheld from him up to the time of his actual reinstatement.

The word “actual” was inserted in the law by RA 6715. Thus, in accordance with the aforesaid law, an unjustly dismissed employee shall receive his full backwages computed from the time his compensation was withheld from him up to the time of his actual reinstatement even if this period is more that three years.



VI. 5%

Company A was engaged in the manufacturing goods using the by-products of coconut trees and employed some fifty worker who lived the coconut plantation in Quezon Province. The land upon which A conducted its operation was subjected to the land reform under RA 6657 for distribution to the tenants and residents of the land. Consequently, A had to close its operations and dismiss its workers. They union representing the employees demanded that A pay the dismissed workers separation pay under Art. 283 of the Labor Code that requires, among others, the payment o separation pay to employees in cases of closing or cessation of operation of the establishment or undertaking. Is the unionis claim correct or nor? Why?

Suggested Answer:

The union’s claim is not correct.

In the case of National Federation of Labor vs. NLRC, GRN 127718, March 2, 2000, the SC ruled that there is no obligation to pay separation pay if the closure is not a unilateral and voluntary act of the employer.

In the question, the closure was brought about not by a unilateral and voluntary act of the employer but due to the act of government in the implementation of CARL.

VII. 5%

Company A and Union B negotiated the last two years of their five-year CBA on April, 1990 to expire on March 31, 1992. Considering the amicable relations between the parties, neither one moved for the extension or termination of the agreement.

Sometime in 1994, some disgruntled employees filed complaint demanding that they be pain the annual salary and other related annual increase specified in the CBA of April 1990, citing the provisions in Article 253 of the labor code which requires the parties to “XXX keep the status quo and the to continue I full force and effect and the terms a conditions of the exiting agreement during the 60 day period and or until a new agreement is reached by the parties.

A however, maintained that the annual salary increase s and related benefits specifically provided of in the CBA were, pursuant to contract and law, effective only the trim specified therein, namely, until March 31, 1992 only.

Who is correct? State the reason for your answers.

Suggested Answer:


The disgruntled employees are correct in their claim that the expired CBA remains in full force and effect until a new CBA is signed in accordance with the Article 253 of the Labor Code.

The SC ruled in NEW Pacific Timber and Supply co., Inc. vs. NLRC, GRN 12424, March 17, 2000, “article 253 of the Labor Code explicitly provided that until a new CBA has been executed by and between the parties, they are duly bound to keep the status quo and to continue if full force and effect the terms and conditions of the existing agreement. The law does not provide for any exception or qualification as to which of the economic provisions of the existing agreement are to retain force and effect, therefore, it must be understood as encompassing all the terms and conditions in the said agreement.”




VIII. 5%

The affected members of the rank and file elevated a labor arbiter’s decision to the NLRC via a petition for review filed after the lapse of the ten-day reglementary period for perfecting an appeal. Should the NLRC dismiss the petition outright or may the NLRC dismiss the petition outright or may the NLRC take cognizance thereof?


Suggested Answer:

The NLRC could dismiss outright the appeal for being filed out of time. But if there are good reasons that may justifiably explain why there was a delay in the filing of the appeal, substantial justice may be the basis for the NLRC to take cognizance of the appeal.



IX. 5%
Company A within the reglementary period, appealed the decision of a Labor arbiter directing the reinstatement of an employee and awarding backwages. However, A’s cash bond was filed beyond the ten day period. Shoe the NLRC entertain the appeal? Why?

Suggested Answer:

No. The NLRC should not entertain the appeal, as the same was not perfected for failure to file a bond. Article 223 of the Labor Code reads: “In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of cash or surety bond.”


X. 5%

A was able to obtain a judgment against his former employer, Co. B for P750, 000. In executing the judgment in favor of A, the Labor Arbiter sought to levy on B’s office equipment. B filed an action for damages and injunction against the Labor Arbiter before the RTC of the province where B’s offices are located. Is B’s action tenable? Why?

Suggested Answer:

B’s action is not tenable.

In the case of Delta Ventures Resources vs. Labato, GRN 118216, March 9, 2000, the SC ruled that the regular courts have no jurisdiction to act on labor cases or various incidents arising therefrom, including the execution of decisions, awards or orders.


XI. 5%

a. What damages can an illegally dismissed employee collect from his employer?

Suggested Answer:

An illegally dismissed employee may collect from his employer actual or compensatory damages, moral damages, exemplary damages, nominal damages as well as attorney’s fees damages.

b. May the Labor Arbiter, NLRC or CA validly award attorney’s fees in favor of a complainant even if not claimed or proven in the proceedings? Why?

Suggested Answer:

Generally, quasi-judicial bodies cannot grant beyond what was asked in the pleadings by the parties. However, in view of article 2208 of NCC, NLRC of CA may allow the award of attorney’s fees when the act or omission of the defendant has compelled the plaintiff to litigate or incurred expense to protect his interest. Attorney’s fees may be awarded in the concept of damages.


XII. 5%

a. What limitations, if any, do the law and jurisprudence impose on an employer’s right to terminate the services of a probationary employee?

Suggested Answer:

The Labor Code provides that 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. If the probationary employee is being terminated for just cause, he must, of course, be given due process before his termination.


b. What requisites must a Union comply with before it can validly impose special assessments against its members for incidental expenses, attorney’s fees, representation expenses and the like?

Suggested Answer:

The Labor Code provides (Art, 241N) that “no special assessments or other extraordinary fees may be levied upon the members of a labor organization unless authorized by a written resolution of a majority of all the members at a general membership meeting duly called for the purpose.”


XIII. 5%
a. X is a bona fide service contractor providing manpower services to various companies, possessing the necessary capital and equipment needed to effectively carry out its commitments. Y is an employee of X and assigned to work as a janitor in company Z. In the course of Y’s assignment, Z’s supervisors and employees would give verbal instructions to Y as to how and where to perform his work. X pays Y salary. Subsequently, Y’s services were terminated by X. Y sued Z for illegal dismissal. May Y’s case against Z prosper? Why?

Suggested Answer:

No. Z is not the employer of Y. The employer of Y is X.

Y would be an employee of Z if X here is a labor only contractor but X is not a labor only contractor. He possesses the necessary capital and equipment needed to effectively carry out its commitment as a service contractor.

Applying the control test, the fact that Z’s supervisors and employees give verbal instruction to Y as to how and where to perform his work does not necessarily means that thereby he is under the control of Z as regards his employment as long as X, as service contractor, actually directs the work of Y. I should also be noted that X pays the salary as the employee of the former.

[pinkalou]

B. In 1960, Juan hired Pablo to drive for the former’s lumber company. In 1970, Pablo got sick and was temporarily laid-off. In 1972, Pablo recovered and resumed working for the same lumber company, now run by Juan’s wife since Juan already passed away. In 1996, Pablo retired. When Pablo applied for retirement benefits with the SSS that same year, he discovered that the lumber company never enrolled him as an employee, much less remitted his contribution that were deducted from his salary. The lumber company agreed to pay for Pablo’s contribution plus penalties but maintained that most of Pablo’s claim had already prescribed under Arty. 1150 of the Civil Code. (Art. 1150 provides “The time for prescription of all kinds of actions, when there is no special provision which ordains otherwise, shall be commenced from the day they may be brought.) Is the Lumber company’s contention correct? Why?

Suggested Answer:

The lumber company’s contention is not correct.

The SSS law (sec. 22b) provides that the right to institute the necessary action against an employer may be commenced within twenty years from the time of the delinquency is known or the assessment ins made by the SSS, or from the time the benefit accrues, as the case may be.



XIV 5%
Company A and Union B could not resolved their negotiations for a new CBA. After conciliation proceedings before the NCMB proved futile, B went on strike. Violence during the strike prompted A to file charges against striker-members of B for their illegal acts. The Secretary of Labor assumed jurisdiction, referred the strike to the NLRC and issued a return-to work order. The NLRC directed the parties to submit their respective position papers and documentary evidence. At the initial hearing before the NLRC, the parties agreed to submit the case for resolution after the submission of the position papers and evidence.

Subsequently, the NLRC issued an arbitral awards resolving the disputed provisions of the CBA and ordered the dismissal of certain strikers for having knowingly committed illegal acts during the strike. The dismissed employees elevated their dismissal to the CA claiming that they were deprived of their right to due process and that the affidavits submitted by A were self-serving and of no probative value. Should the appeal prosper? State the reasons for your answers clearly.


Suggested Answer:

The appeal should not prosper.

The SC, in many cases, has ruled that decisions made by the NLRC may be based on position papers. In the question, it is stated that the parties agreed to submit the case for resolution after the submission of position papers and evidence. Given this fact, the striker-members of B cannot now complain that they were denied due process. They are in estoppel. After voluntarily submitting a case and encountering an adverse decision on the merits, it is too later for the lower to question the jurisdiction or power of the court. A party cannot adopt a posture of double dealing Marques vs. Secretary of Labor, March 16, 1989).



XV. 5%

a. A, and employee of company B, was found to have been illegal dismissed and was ordered to be reinstated and paid backwages from the time of dismissal until actual reinstatement. The case was elevated all the way to the SC. By the SC’s decision became final and executory, B and closed down and was In the process of winding up. Nonetheless, B paid A his backwages and separation pay. A complained that B’s computation was erroneous in that A’s allowances was not included. Is A correct in his claim? For what reasons?

Suggested Answer:
A is correct. After its amendment by RA 6715, the backwages that an employee who has been unjustly dismissed is entitled to receive is not limited to his full back wages but also includes his allowances and the other benefits or their monetary equivalent.

b. Soon after the Asian meltdown began in October 1997, ABC Realty and Management Corporation undertook a downsizing program and terminated nearly a third of its regular workforce. The affected employees questioned their termination arguing that the action was precipitate in that ABC neither had nor proved that it sustained any losses. Is the claim of the employees correct? Explain your answer.

Suggested Answer:
The claim of the employees may or may not correct.

When the Corporation undertook its “downsizing program, it may have terminated its employees on either one of two grounds, namely, redundancy or retrenchment.

For, Redundancy, there is no requirement of losses, whereas in retrenchment, substantial losses, actual or anticipated, is a requirement. (article 283, Labor Code). In Atlantic Gulf and Pacific Company vs. NLRC (GRN 127516, May 28, 199) the SC ruled that it is necessary to distinguish redundancy from retrenchment… Redundancy exists when the services of an employee are in excess of what is required by an enterprise. Retrenchment on the other hand, is resorted to primarily to avoid or minimize business losses.”

In Escareal vs. NLRC, 213 SCRA 472 (1992), the SC ruled that the law does not require financial loss as a basis for redundancy.


XVI.5%
a. What conditions must prevail and what requirements, if any, must an employer comply with the justify /effect a valid retrenchment?

Suggested Answer:
In the case of Asian Alcohol vs. NLRC, GRN 131108, March 25, 1999, the SC stated that the requirement for a valid retrenchment must be proved by clear and convincing evidence:
1. That the retrenchment is reasonable necessary and likely to prevent business losses which, if already incurred, are not merely de minimis, but substantial, serious, actual and real of if expected, are reasonably imminent as perceived objectively and in good faith by the employer;
2. That the employer served written notice both to the employees and to the DOLE at least one month prior to the intended date of retrenchment;
3. That the employer pays the retrenched employees separation pay equivalent to one month or at least one month pay for every year of service, whichever is higher;
4. that the employer exercises its prerogative to retrench employees in good faith for the advancement of its interest and not to defeat or circumvent the employees’ right to security of tenure; and
5. that the employer used fair and reasonable criteria in ascertaining who would be dismissed who would retained month the employees, such as status, efficiency, seniority, physical fitness, age and financial hardship for certain workers.

b. What conditions must prevail and what requirements, if any, must an employer comply with to justify/effect a valid redundancy program?

Suggested Answer:

In the case of Asian Alcohol Corp (supra), the SC stated that redundancy exists when the service capability of the work is in excess of what is reasonably needed to meet the demands on the enterprise. A redundant position is one rendered superfluous by any number of factors, such as over hiring of workers, decreased volume of business dropping or a particular line previously manufactured by the company or phasing out of a service activity previously undertaken by the business. Under these conditions, the employer has no legal obligation to keep in its payroll more employees than are necessary for the operation of its business.

For the implementation of a redundancy program to be valid, the employer must comply wit the following requisites:
1. written notice served on both the employee and DOLE at least one month prior to the intended date of retrenchment;
2. Payment of separation pay equivalent to at least one month pay for every year of service whichever is higher;
3. Good faith in abolishing the redundant position; and
4. Fair and reasonable criteria in ascertaining what positions are to be declared redundant and accordingly abolished.

c. Is the seniority rule or “Last in, first out” policy to be strictly followed in effecting a retrenchment or redundancy program?

Suggested Answer:

Again, in Asian Alcohol (supra), the SC stated that with regard the policy of “first in, lest out? In choosing which positions to declare as redundant or whom to retrench to prevent further business losses, there is no law that mandates such a policy. The reason is simple enough. A host of relevant factors come into play in determining cost efficient measures and in choosing the employees who will be retained separated to save the company from closing shop. In determining these issues, management plays a pre-eminent role. The characterization of positions as redundant is an exercise of business judgment on the part of the employer. It will be upheld as long as it passes the test of arbitrariness.

XVII 3%

Eduardo Santiago, a project worker, was being assigned by his employer, BAGSAK Builders, to Laoag, Ilocos norte. Santiago refused to comply with the transfer claiming that it, in effect, constituted a constructive dismissal because it would take him away from his family and his usual work assignments in Metro Manila. The labor arbiter found that there was no constructive dismissal but ordered payment of separation pay due to strained relations between Santiago and BAGSAK Builders plus attorney’s fee equivalent to ten percent of the value of Santiago’s separation pay.

Is the award of attorney’s fees is not valid. According to the Labor Code (Art. 111a), attorney’s fees may be assessed in cases of unlawful withholding of wages which does not exit in the case. The workers refused to comply with a unlawful transfer order, and hence, a refusal to work. Given this fact, there can be no basis for the payment of attorney’s fees.


b. could the labor arbiter have validly awarded moral and exemplary damages to Santiago instead of attorney’s fees? Why?


Suggested Answer:

No. Moral and exemplary damages can be awarded only if the worker was illegally terminated in an arbitrary or capricious manner. (Nueva Ecija Electric Cooperative vs. NLRC GRN 116066, January 24, 2000).


XVIII. 5%

a. Under what conditions may the Sec. of Labor or his duly authorized representative inquire into the financial activities or legitimate labor organization?

Suggested Answer:

The labor code (Art. 274), the Secretary of Labor and Employment or his duly authorized and representative is empowered to inquire into the financial activities of legitimate labor organizations upon the filing of a complaint under oath and duly supported by the written consent of a t least 20% of the total membership of the labor organization concerned and to examine their books of accounts and other records.

b. Some disgruntled members of Bantay Labor Union filed with the Regional Office of the Dole a written complaint against their union officers for mismanagement of union funds. The Regional Director did not rule in the complainants favor. Nor satisfied, the complainants elevated the Regional Director’s decision to the NLRC. The union officers moved to dismiss on the ground of lack of jurisdiction. Are the union officers correct? Why?


Suggested Answer:

Yes. The union officers are correct in claiming that the NLRC has no jurisdiction over the appealed ruling of the Regional Director. In Barles vs. Bitonio, GRN 120220, June 16, 1999, the SC ruled that appellate authority over decisions of the Regional Director involving examination of union accounts is expressly conferred on the BLR under the Rule of Procedure on Mediation-Arbitration.

Sec. 4. Jurisdiction of the Bureau – b. The Bureau shall exercise appellate jurisdiction over all cases originating from the Regional Director involving … complain for examination of union book of accounts.

The language of the law is categorical. Any additional explanation on the matter is superfluous.


XIX 5%

a. B. Ukol was compulsorily retired by his employer, Kurot Bottling Corporation, upon the former is reaching 65 years of age, having rendered 30 years of service. Since there was no CBA, B. Ukol was paid his retirement benefits computed 15 days’ pay for every year of his employment. Not satisfied, B. Ukol filed an action with the Arbitration Branch of the NLRC claiming that his retirement benefits were not computed properly. Is B, Ukol’s claim meritorious? What are the components of his retirement benefits?


Suggested Answer:
Ukol’s claim is meritorious. His retirement benefit is to be computed in accordance with Article 287, which reads: “IN the absence of a retirement plan or agreement providing for retirement benefits of employees in the establishment, an employee may retire … and shall be entitled to retirement pay equivalent to a t least one half month salary for every year of service, a fraction of at least six months being considered as one whole year. The same Article then explain that the term one-half month salary means fifteen days plus one-twelfth of the 13th month pay an the cash equivalent of not more than five days of service incentive leaves.

The components of retirement pay are the following:
1. 15 days pay
2. 1/12 of the 13th month pay, and
3. Cash equivalent of not more than five days of service incentive leave.

b. What exception does the does the law on retirement benefits provides if any?

Suggested Answer:

Retail, service and agricultural establishments or operations employing not more than 10 employees or workers are exempted from the coverage of the provision on retirement benefits in the Labor Code.

Also, where there is a retirement plain of the employer that grants more than what the Labor Code grants.

XX 5%.

UNIDAD, a labor organization claiming to represent the majority of the rank and file workers of BAGSAK Toyo Manufacturing Corp. (BMTC), file a petition for certification election during the freedom period obtaining in said corporation. Despite the opposition thereto by SIGAW Federation on the Ground that UNIDAD was not possessed with all the attributes of a duly registered union, the Med-Arbiter issued an Order calling for a certification election on July 25, 2001.

This order was promulgated and served on the parties on July 12, 2001. On July 14, 2001, UNIDAD submitted and served. The required documents for its registration as an independent union, which documents were approved by the DOLE on July 15, 2001.

During the elections, UNIDAD won over SIGAW.SIGAW questioned UNIDAD’s victory on the ground that UNIDADA was not a duly registered union when it filed the petition for a certification election. Shall SIGAW’s case prosper or not? Why?

Suggested Answer:
No. SIGAW’s case will not prosper. The application of technicalities of procedural requirements in certification election disputes will serve no lawful objective or purpose. It is a statutory policy that no obstacles should be placed on the holding of a certification election (Samahan ng Mangagawa sa Pacific Plastic vs. Laguesma, 267 SCRA 203, 1997 and that the law is indisputably partial to the holding of a certification election (Western Agusan vs.Trajano, 196 SCRA 622, 1991).

At any rate, UNIDAD completed all the requirements for union registration on July 14, 2001, and legitimate union status was accorded on July 15, 2000, or at least 10 days before the schedule date for holding the Certification Election.