2023 Bar Exam Notes in Labor Law & Social Legislations

By
Atty. Jose Sonny G. Matula
President of the Federation of Free Workers (FFW)
Law Lecture at the MLQU School of Law
(September 16, 2023)

1. ILO Conventions

Q: How should ILO Conventions be regarded within the jurisdiction of the

Philippines?

A: ILO Conventions must be accorded the highest level of respect, akin to legally
binding statutes, as they possess the force and effect of domestic law.
A significant legal precedent affirming this principle can be found in the case of
The Heritage Hotel Manila vs. National Union of Hotel, Restaurant and Allied
Industries (G.R.178296, January 12, 2011), where the court upheld the status of
ILO Convention No. 87 as a binding law.
It is worth noting that the Philippines recognizes the supremacy of international
law through the "incorporation clause" of the 1987 Constitution (Sec 2 of Article
II). Consequently, International Conventions of the International Labor
Organization, such as ILO Convention No. 87 and Convention No. 98, hold the
same weight as the Labor Code, Civil Code, Penal Code, and other acts of
Congress in the resolution of disputes in quasi-judicial bodies and regular courts.

2. Tripartism

Q: What does tripartism in labor relations entail?

A: Tripartism in the context of the ILO and labor relations in the Philippines can be
defined as the active involvement of workers and employers in decision-making
processes and policy formulation within government bodies.
The Labor Code explicitly establishes tripartism in labor relations as a fundamental
State policy. The government's adoption of tripartism aligns with the principles of
"shared responsibility" and "participation in decision-making" (often referred to as
"co-determination") as enshrined in Section 3, Article XIII of the Constitution,
which pertains to Social Justice and Human Rights.
Tripartism is consistent with Article 290 (formerly Art. 275) on Tripartism and
Tripartite Conferences in the Labor Code, as amended, ILO Convention No. 144
on Tripartite Consultations to Promote the Implementation of International Labor
Standards, and Republic Act No. 10395, also known as "An Act Strengthening
Tripartism."
Through the practice of tripartism, social dialogue is enhanced, allowing the three
primary stakeholders in industrial relations—workers and employers, representing
their respective interests, and the government, representing the public interest—to
collaborate and forge decisions that shape labor, social, and economic policies and
government programs.

3. Wage Distortion

Q: What is wage distortion under the Labor Code and why does it occur?

A: Wage distortion arises when mandated wage increases significantly reduce or

eliminate wage differences among employee groups within a company. Article 124
of the Labor Code (PD 442, as amended) permits the restoration of these
distinctions.

Q: If the Regional Tripartite Wage and Productivity Board of the National

Capital Region enforces a new wage order with a P40 wage hike, resulting in
wage distortions for a company with a collective bargaining agreement, who
should resolve this labor dispute?
A: Both the employer and the union should engage in negotiations to rectify the
wage distortions.

Q: How should the union and employer resolve wage distortion?

A: Disputes arising from wage distortion should follow the grievance procedure
outlined in their collective bargaining agreement (CBA). If unresolved, voluntary
arbitration should be pursued. Unless otherwise agreed, the voluntary arbitrator or
panel should decide within ten (10) calendar days from the referral.

Q: What if there are no collective agreements or recognized labor unions? How

should wage distortion be resolved?

A: Employers and workers should meet to address distortions. If unresolvable at

the company level, it should be referred to the National Conciliation and Mediation
Board. If not resolved within ten (10) calendar days of conciliation, it goes to the
appropriate branch of the National Labor Relations Commission (NLRC). The
NLRC must conduct continuous hearings and decide within twenty (20) calendar
days.

Q: Can the employer delay implementing the wage order if the wage distortion
issue remains unresolved?

A: No, the pendency of a wage distortion dispute does not delay the applicability
of mandated wage rate increases.

Q: Is resolving wage distortion mandatory when there is a mandated wage hike?

A: No, it is not legally required to address wage distortion specifically during a

minimum wage increase granted by the RTWPB or by a legislative fiat.
Q: What happens if workers or their union do not address existing wage
distortion?

A: There are no immediate consequences. However, employers are encouraged to

review and adjust wage structures to maintain or restore wage differentials,
ensuring fairness and helping employees with lower wages cope with the rising
cost of living.

4. Overseas Workers

Q: Can Juan Obrero, an overseas Filipino worker at a pearl farm in Australia,

choose not to send his earnings to his dependents and instead keep them in the
country of his employment to earn more interest? Explain.

A: No, Juan Obrero cannot refuse to remit his earnings to his dependents.
According to Article 22 of the Labor Code, it is mandatory for all Filipino workers
abroad to remit a portion of their foreign exchange earnings to their families,
dependents, and/or beneficiaries in the Philippines, as per rules and regulations set
by the Secretary of Labor.

Q: What is the rationale behind mandatory remittance?

A: The mandatory remittance requirement aims to safeguard the well-being of

families, dependents, and beneficiaries while ensuring that foreign exchange
earnings of overseas workers are routed through authorized Philippine government
financial institutions to support the country's economic development program.
Non-compliance with these remittance laws and the use of unauthorized financial
institutions have had adverse effects on the country's balance of payments and
economic development program. Consequently, strict compliance with mandatory
remittance, along with the establishment of appropriate remittance channels and
effective sanctions, is crucial (as stated in "Whereas" clauses, Executive Order No.
857; Section 2, Rule XIII, Book I, Rules Implementing the Labor Code)

5. Occupational Health and Safety

QUESTION; In the exercise of the Secretary of Labor’s visitorial and

enforcement power, the DOLE Regional Director has found that a T-shirt
company in Tandang Sora, Quezon City, violated several occupational
health and safety rules. In his evaluation, if immediate remedial measures
are not taken, the lives and well-being of the 15 workers are in danger.
Can the Regional Director suspend the operation of the T-Shirt Company?
Are the workers entitled to compensation during the period of suspension?
Please provide a brief explanation. Additionally, if the company is required
to undertake remedial measures, is it obliged to pay fines for non-
compliance?

SUGGESTED ANSWER:

Yes, the DOLE Regional Director can suspend the operations of the T-shirt
company in accordance with Article 128(c) of the Labor Code, which grants
the Secretary of Labor and Employment the authority to order the stoppage
of work or suspension of operations of any unit or department of an
establishment when non-compliance with the law or implementing rules and
regulations poses a grave and imminent danger to the health and safety of
workers in the workplace.

However, it's important to note that a hearing must be conducted within

twenty-four hours to determine whether the order for the stoppage of work
or suspension of operations should be lifted or upheld.

Regarding compensation for the workers during the period of suspension,

they are entitled to compensation if the violation is attributable to the fault of
the employer. The company is responsible for paying the affected employees
their salaries or wages during the period of the stoppage of work or
suspension of operations.
 In the case of the company being required to undertake remedial measures, it
is indeed obliged to pay fines for non-compliance. This can be pointed out in
reference to RA 11058, known as the New Occupational Health and Safety
Law, which imposes administrative fines for non-compliance with
Occupational Safety and Health (OSH) standards. These fines can amount to
up to P100,000 per day until the violation is rectified.

6. Right to Self-organization

QUESTION: A group of workers, whose factory is located in a special

economic processing zone in Clark in Pampanga, were told that employees in
ecozones are prohibited from forming unions. They approach you for advice
on whether this prohibition is true and, if not true, how they can organize a
trade union for collective bargaining purposes in their workplace. They also
seek your opinion on the steps they need to take to establish a legitimate labor
organization. What guidance would you offer them? Provide your advice.

SUGGESTED ANSWER:

Workers in the ecozones have the right to form and join unions. The right to self-
organization is a constitutional right under Section 8, of the Bill of Rights, which
speaks: “The right of the people, including those employed in the public and
private sectors, to form unions, associations, or societies for purposes not contrary
to law shall not be abridged

Under Section 37 of RA 9516 (as amended by RA 8748), labor and management

relations within the ECOZONE shall be governed by the existing Labor Code of
the Philippines. Employees and personnel in ECOZONE enterprises are entitled to
receive salaries and benefits, as well as enjoy working conditions that are at least
equivalent to those provided under the Philippine Labor Code and other relevant
laws, regulations, and guidelines.
Q: What are the documentary requirements in organizing a union?
A: For those interested in organizing a union, here are the key requirements:

1. Registration Fee: An applicant labor organization is required to pay a

registration fee of fifty pesos (P50.00).
2. Documentation: The organization should provide the following
documentation:
a. Names and addresses of its officers.
b. The principal address of the labor organization.
c. Minutes of the organizational meetings.
d. A list of the workers who participated in these meetings.
e. The names of all members, constituting at least twenty percent (20%)
of all employees in the bargaining unit where it intends to operate.
f. If the applicant union has been in existence for one or more years, it
must submit copies of its annual financial reports.
g. Four (4) copies of the constitution and by-laws of the applicant union,
along with minutes of their adoption or ratification and a list of the
members who participated in this process.

These requirements are essential to acquiring legal personality and being entitled to
the rights and privileges granted by law to legitimate labor organizations. It's
crucial to follow these steps diligently and in accordance with the Labor Code to
establish a legitimate labor organization for collective bargaining purposes in your
workplace.

In summary, you have the right to form a union in the ECOZONE, and I
recommend complying with the outlined requirements to establish a legitimate
labor organization. This will enable you to pursue collective bargaining and protect
the rights and interests of the workers in your workplace.

7. Illegal termination
 QUESTION: Prof. Gil Dimagalang was a faculty member at Loreto
College of Agriculture, Technology and Sciences in Agusan.
On July 21, 2021, while Cora Son, a student assistant, was numbering the
lockers as per the policy set forth by the Department Head, Dr. Jorge Sagunto,
Prof. Dimagalang inquired about her activity. The student assistant explained
that she was re-assigning lockers for faculty members through a random
drawing. Another professor commented, it's as if we're children again," to which
Prof. Dimagalang responded loudly, "indeed, just like first graders, what a
novelty for first graders." This exchange escalated into a heated argument when
Dr. Sagundo confronted Prof. Dimagalang, who eventually left while Dr. Jorge
was still addressing him.
An administrative investigation followed, and the investigating committee
found Prof. Dimagalang guilty of serious misconduct for making a derogatory
comment towards his superior. Instead of terminating Prof. Dimagalang, the
committee considered that this was his first offense and emphasized the potential
for reform and redemption in the case. Consequently, Prof. Dimagalang received
a two-month suspension without pay and was instructed to submit a written
public apology to Dr. Sagunto.
On July 29, 2021, Prof. Dimagalang requested reconsideration of his
suspension, citing the pending criminal complaint for grave oral defamation
filed by Dr. Sagundo with the City Prosecutor’s Office. His request was denied,
prompting him to file a complaint for illegal suspension and unfair labor
practices.
During the case's proceedings before the NLRC, the Committee once
again demanded Prof. Dimagalang to submit a written public apology. However,
he refused to comply. He said that he was following the legal advice of his lawyer
that doing so might incriminate him. Another show cause letter was issued,
warning of possible dismissal for insubordination if he failed to submit the
apology. Prof. Dimagalang held his ground and was eventually terminated for
insubordination.
Considering the circumstances, was Prof. Dimagalang's dismissal from
employment illegal? Support your answer.

SUGGESTED ANSWER:
 Yes, the respondents failed to provide substantial evidence demonstrating
that Dimagalang's refusal to apologize was a deliberate or intentional act. In
the precedent set by the Supreme Court in the case of Joel Montallana vs. La
Consolacion College (G.R. No. 208890, December 8, 2014), the Court
upheld the National Labor Relations Commission's decision and emphasized
that the burden of proof lies with the employer. The employer must
substantiate that just cause, or any other authorized cause, warranted the
employee's dismissal. Failing to do so renders the dismissal illegal.

The Supreme Court, concurring with the NLRC, found that Montallana's
disobedience could not be classified as "willful" within the scope of Article
296 of the Labor Code. Furthermore, it noted that Dimagalang's sincere
belief that issuing an apology could incriminate him in the criminal case for
grave oral defamation, coupled with his legal counsel's advice, demonstrated
good faith in dealing with his employer.

Hence, this negates the argument that Diamagiba’s failure to comply with
the directive to apologize was accompanied by a "wrong and perverse
mental attitude, rendering the employee's actions inconsistent with proper
subordination," which would justify his termination from employment.

Thua, Prof. Dimagalang termination from employment is illegal.

8. SSS Survivorship Pension

QUESTION: Ka Boni, aged 60, retired from Maharlika Company, Inc., in

November 2020. After his retirement, Boni married his longtime partner,
Eve, in December. Tragically, he succumbed to a COVID-19 infection in
June 2021. They have five adult children who reside separately. Following
Boni's passing, Eve received an SSS funeral benefit of P40,000, but her
claim for a survivorship pension as Boni's widow was denied by the SSS
Office in Manila.
The SSS based its denial on Section 12-B (d) of Republic Act 8282, which
stipulates that "(d) Upon the death of the retired member, his primary
beneficiary as of the date of his retirement shall be entitled to receive the
monthly pension xxx." Their argument is that Eve was not married to
Boni at the time of his retirement, making her ineligible as a primary
beneficiary due to their marriage occurring after the retirement date.

Eve has sought legal assistance from your office, and it falls upon you to
provide guidance on how she can secure her entitlement to the
survivorship pension. In light of these circumstances, please compose an
advisory letter to Eve.

SUGGESTED ANSWER:

Dear Eve,

I hope this letter finds you in good health. I am writing in response to your
request for legal assistance regarding the denial of your survivorship claim
by the Social Security System (SSS) under Section 12-B (d) of Republic Act
11199, which states that "(d) Upon the death of the retired member, his
primary beneficiary as of the date of his retirement shall be entitled to
receive the monthly pension xxx."

You are correct in pointing out that at the time of Boni's retirement, you
were not yet married to him, which led SSS to argue that you do not qualify
as a primary beneficiary because your marriage to Boni occurred after the
date of his retirement.

However, it is crucial to note that the Supreme Court has already declared
the quoted provision of the SSS Law as unconstitutional in the case of
Dycaico vs. SSS on November 30, 2007. The Court's decision was based on
the grounds that this provision violated both the "due process" and "equal
protection" clauses of our fundamental law.
 In essence, you have been unjustly deprived of your vested right to succeed
to the social insurance benefits of your husband solely because your
marriage took place after his retirement. This distinction between marriages
before and after retirement lacks valid justification and constitutes unjust
discrimination. Marriages "before" and "after" retirement should be treated
equally without prejudice or discrimination.

Considering that the SSS has already denied your claim based on an
unconstitutional provision, the appropriate course of action is to file a
complaint or petition against the SSS with the Social Security Commission.
The Commission is tasked with adjudicating claims and disputes related to
social security benefits.

Please rest assured that you have a strong legal basis to challenge the denial
of your survivorship claim, and I am here to assist you throughout this
process. If you have any further questions or require assistance with the
necessary legal procedures, please do not hesitate to reach out to my office.

Thank you for entrusting me with your case, and I look forward to helping
you secure the survivorship pension that you rightfully deserve.

Warm regards,

Atty. ABC

9. Payment Below Minimum Wage

QUESTION: In a startling revelation, it was exposed during a Senate

hearing that a significant number of TESDA (Technical Education and
Skills Development Authority) graduates have been receiving wages below
the legally mandated minimum wage.

TESDA, an institution dedicated to equipping individuals with the skills

and knowledge necessary for gainful employment, has long served as a
beacon of hope for countless Filipino workers seeking opportunities to
enhance their livelihoods. However, recent reports have unveiled a
disheartening truth: a substantial portion of TESDA graduates is being
remunerated at rates falling short of the minimum wage set by the
government.

According to a TESDA official, this issue of substandard wage payments

became rampant during the peak of the pandemic when job opportunities
were scarce. Many unscrupulous entities took advantage of those seeking
employment. Now, as a legal expert participating in this hearing, you are
asked the question of whether the workers can still recover their unpaid
balance of the minimum wage. Explain briefly.

SUGGESTED ANSWER:

I must emphasize that workers who are TESDA graduates or not can indeed
recover the unpaid balance of their minimum wage. They can initiate this
process by filing -- a single entry approach (SENA) request and if no
amicable resolution is reached -- a formal complaint with either the
Regional Arbitration Branch of the NLRC (National Labor Relations
Commission) or the DOLE (Department of Labor and Employment)
Regional Office.

This blatant violation of labor laws not only undermines the hard work and
dedication of TESDA graduates, or any worker for that matter but also
perpetuates a cycle of exploitation that demands the strongest condemnation.

Under our labor standards law, specifically Republic Act No. 8188, which
has been in effect since June 11, 1996, the criminal penalties for violators of
the minimum wage law have been heightened. Furthermore, this law
imposes double indemnity on such violators concerning wages of their
employees.

Q: What is “double indemnity”?

A: As per the double indemnity provision within the said act, employers who
willfully refuse or fail to pay the minimum wage prescribed by law shall be
obligated to pay an amount equal to "double the unpaid benefits owed to
the employees." This obligation exists concurrently with the potential
criminal liability of the employer under the same law.

It is imperative to remind employers and institutions across the country that

adherence to labor laws, including Republic Act No. 8188, is not a matter of
choice but a legal obligation. Workers who are unjustly compensated below
the minimum wage are afforded full protection under the law, and those who
flout these regulations will face severe consequences.

Q: Who is Liable Under Section 1 of RA 8188? Other than the fine, is

there a criminal liability?

A: Section 1 of Republic Act No. 8188 stipulates the liability for non-
compliance with prescribed wage rate increases or adjustments. Any person,
corporation, trust, firm, partnership, association, or entity that refuses or fails
to pay the prescribed wage increases as per this Act shall be subject to the
following penalties:

A fine is not less than Twenty-five thousand pesos (P25,000) nor more than
One hundred thousand pesos (P100,000).Imprisonment not less than two (2)
years nor more than four (4) years.

Both the fine and imprisonment, are at the discretion of the court.
It is important to note that anyone convicted under this Act shall not be
entitled to the benefits provided for under the Probation Law.

Furthermore, the employer found in violation of this Act shall be required to

pay an amount equivalent to double the unpaid benefits owed to the
employees. This payment of indemnity does not absolve the employer from
the criminal liability imposed under this Act.

In cases where a corporation, trust, firm, partnership, association, or any

other entity is the violator, the penalty of imprisonment shall be imposed
upon the entity's responsible officers, including but not limited to the
president, vice president, chief executive officer, general manager, managing
director, or partner.
10. Security of Tenure

QUESTION: In 2021, amid the height of the COVID-19 pandemic, Leni,

Kiko, Alex, Chel, Leila, Sonny, Teddy, Antonio, and Risa contested the
ruling of the Labor Arbiter which had declared them as non-regular
employees of a delivery company. The company had classified them as
"independent contractors" and argued that they did not have security of
tenure as regular employees.

The complainants made their case before the First Division of the NLRC
asserting that they were hired by the delivery company as riders, with the
primary responsibility of collecting items from sellers and delivering them
to the company's warehouse. The motorcycles being used in the delivery
were taken from their loans facilitated by the company. They were
compensated with a daily service fee of 1,200 pesos (equivalent to US$24)
for a period of one year. You are the assigned Commissioner of the NLRC
to resolve whether the riders are employees or independent contractors.
Explain your answer.

SUGGESTED ANSWER:

My ruling will favor the workers. When there is a dispute regarding

employment status, according to Justice Leonen, the burden of proof lies
with the employer to establish that the individuals whose services they pay
for are indeed independent contractors and not regular employees, regardless
of whether the employment has a fixed term or not.

The protection of labor rights and the assurance of job security are not mere
decorative words on paper; they are fundamental rights that must be upheld
in the real world for workers.

Drawing from the precedent set in the case of Ditiangkin et al vs. Lazada
(G.R. No. 246892 dated September 21, 2022) and using the four-fold test,
the Supreme Court has overruled the decision of the appellate court. In this
ruling, the Supreme Court stated that the riders could not be considered
independent contractors because they did not engage in any specific skill or
talent that would typically be associated with independent contracting.

Furthermore, the Supreme Court determined that the services provided by

the petitioners were integral to the core operations of their employer. Their
delivery services were seamlessly integrated into the company's business
model, establishing them as regular employees who offered essential
services to the company.

In summary, the Supreme Court's resolution supports the complainants'

claim of being regular employees entitled to labor rights and job security due
to the nature of their work and the integral role they play in the company's
operations.###.