CHAPTER I: JURISDICTIONS

1. The Department of Labor and Employment

The Department of Labor and Employment (DOLE) is the national government
agency mandated to formulate policies, implement programs and serve as the policy-
coordinating arm of the Executive Branch in the field of labor and employment.
It serves more than 40 million workers comprising the country’s labor force,
covering those in the formal and informal economies, private and public. On top of this, the
DOLE clients also include workersorganizations, employers and/or employers groups, non- 1

government organizations (NGOs), and other government agencies, the academe, other
stakeholders, international organizations (e.g., ILO, IOM, UNDP, UNICEF), and the
international community including the host countries of our OFWs.
The DOLE clients include trade unions, workers’ organizations and employers
and/or employers groups (i.e., ECOP, chambers of commerce and industries, TUCP, FFW,
etc). There are existing Tripartite Industrial Peace Councils (TIPCs) and 128 existing
Industry Tripartite Councils (ITCs) serving as mechanisms for social dialogue in addressing
labor and employment issues.
The DOLE also maintains linkages with non-government organizations (NGOs),
government agencies, the academe, partner international organizations (e.g., ILO, IOM,
IMO, UNDP, UNICEF), and with the international community, particularly the host countries
where our OFWs are based. [from DOLE Website]

What are the quasi-judicial powers of the DOLE?

Under Art. 129 of the Labor Code, the power of the DOLE and its duly authorized
hearing officers to hear and decide any matter involving the recovery of wages and other
monetary claims and benefits was qualified by the proviso that the complaint not include a
claim for reinstatement, or that the aggregate money claims not exceed PhP 5,000. RA
7730, or an Act Further Strengthening the Visitorial and Enforcement Powers of the
Secretary of Labor, did away with the PhP 5,000 limitation, allowing the DOLE Secretary to
exercise its visitorial and enforcement power for claims beyond PhP 5,000. The only
qualification to this expanded power of the DOLE was only that there still be an
existing employer-employee relationship.

THE BUREAU OF LABOR RELATIONS

Art. 226. Bureau of Labor Relations. – The Bureau of Labor Relations and the Labor
Relations [now Industrial Relations Division] in the regional offices of the DOLE shall have
original and exclusive authority to act, at their own initiative or upon request of either or
both parties, on all inter-union and intra-union conflicts, and all disputes, grievances or
problems arising from or affecting labor-management relations in all workplaces whether
agricultural or non-agricultural, except those arising from the implementation or
interpretation of collective bargaining agreements which shall be the subject of grievance
procedure and / or voluntary arbitration.

The Bureau shall have fifteen (15) working days to act on labor cases before it,
subject to extension by agreement of the parties. [As amended by Sec. 14, RA. 6715, 21
March 1989]

NOTES:

By virtue of Executive Order No. 251, creating the National Conciliation and
Mediation Board, the conciliation, mediation and voluntary arbitration functions of the
Bureau of Labor Relations were removed therefrom, and are now absorbed into the power
and jurisdiction of the NCMB. This EO was further amended by EO No. 126.
 The BLR’s hearing officers are titled “Med-Arbiters” (short for mediator-arbitrator).
A “Med-Arbiter” is an officer in the Regional Office or in the Bureau authorized to hear,
conciliate, mediate and decide representation cases, or to assist in the disposition of intra-
or inter-union disputes. Representation cases refer to the proceedings intended to
determine which one, among rival unions, should be officially designated or certified as the
exclusive representative of the employees in bargaining collectively with their employer.

The only function now of the Bureau of Labor Relations, through its Industrial
Relations Divisions in the Regional Offices, is the original and exclusive authority to act, at
their own initiative or upon request of either or both parties, on: 2

Quasi – Judicial Functions:

1. Hears all inter-union disputes;

2. Hears all intra-union conflicts;
3. Hears small money claims cases; and
4. Hears all disputes or problems arising from or affecting labor-management relations in
all workplaces, except those arising from the implementation or interpretation of CBAs
which shall be the subject of grievance procedure and/or voluntary arbitration. [Art.
226, LC; Policy Instruction No. 6]

It also has the following Administrative Functions:

a. Regulates the registration of labor unions and revokes union registration certificates;
b. Regulates and registersCollective Bargaining Agreements; maintains a file thereof;
c. Maintainsa registry of Labor Unions;
d. Examines union accounts and monitors foreign assistance to labor groups;
e. Implements the workers’ organization development program; and
f. Conducts labor education seminar.

It must be emphasized that the provisions of the KatarungangPambarangay do not

apply to labor tribunals and agencies. This is due to the fact that there are already
established agencies, fora, tribunals and offices which shall expeditiously deal with these.
To refer the labor dispute to the barangay lupon would add another barrier andcontravene
the spirit of the constitutional provision on protection to labor and the speedy disposition
of such cases.

Prior to the SEnA Proceedings, what alternative dispute resolution

proceeding was, (and still is) in effect in the performance of these functions?

At the Bureau of Labor Relations, through the Industrial Division of each DOLE
Regional Offices, this rule is applied.

D.O. NO. 40-03, S. 2003 INTRA - UNION DISPUTES

RULE XI : INTER/INTRA-UNION DISPUTES AND OTHER RELATED LABOR
RELATIONS DISPUTES

Section 9. Conduct of preliminary conference. - The Med-Arbiter or Hearing Officer,

as the case may be, shall conduct a preliminary conference and hearing within ten
(10) days from receipt of the complaint or petition. He/She shall exert every effort
to effect an amicable settlement of the dispute.

Where the parties agree to settle amicably, their agreements shall be specified in the
minutes of the conference and a decision based on compromise shall be issued by
the Med-Arbiter or the Regional Director, as the case may be, within five (5) days
from the date of the mandatory conference.
Where no amicable settlement is reached, the Med-Arbiter or Hearing Officer, as the
case may be, shall proceed with the stipulation of facts, limitation or definition of the
issues, clarificatory questioning and submission of laws and jurisprudence relied
upon in support of each other's claims and defenses.

3
 The National Conciliation and Mediation Board
A BACKGROUNDER

The 1986 Philippine Constitution, particularly paragraph 3, Section 3, Art.

XIII provides, among others:

“. . . The State shall promote the principle of shared responsibility between

workers and employers and the preferential use of voluntary modes of settling
disputes, including conciliation, and shall enforce their mutual compliance
4
therewith to foster industrial peace . . . “

The National Conciliation and Mediation Board is attached to DOLE and

under the administrative supervision of the Secretary of Labor and Employment. It
absorbs the conciliation, mediation, labor-management cooperation and voluntary
arbitration functions of the Bureau of labor Relations [BLR] and its counterparts in
the regional offices of the Department in accordance with Section 29 (c) of EO No.
126.

NCMB MANDATE

The NCMB, created under Executive Order No. 126, reorganizing the DOLE, shall
formulate policies, develop plans and programs and set standards and procedures
relative to the promotion of conciliation and mediation of labor disputes through
the preventive mediation, conciliation and voluntary arbitration; facilitation of
labor-management cooperation through joint mechanisms for information sharing,
effective communication and consultation and group-problem solving.

VISION
The NCMB shall be the center of excellence in enhancing harmonious relationship
in every workplace.

MISSION
To sustain harmonious labor and management relations through continuous
education, mainstreaming of alternative dispute resolution (ADR) mechanisms, and
implementation of innovation approaches towards worker's empowerment.

FUNCTIONS

As a staff and a line office, it has the following functions:

1. Formulates policies, programs, standards, procedures, manual of operations and

guidelines pertaining to effective mediation and conciliation of all labor disputes;
2. Perform preventive mediation and conciliation functions;
3. Coordinate and maintain linkages with other sectors or institutions, and other
government authorities concerned with matters relative to the prevention and
settlement of labor disputes;
4. Formulate policies, plans, programs, standards, procedures, manuals of
operations and guidelines pertaining to the promotion of cooperative and non-
adversarial schemes, grievance handling, voluntary arbitration and other
voluntary modes of dispute settlement;
5. Administer the voluntary arbitration program; maintain / update a list of
voluntary arbitrators, compile arbitration awards and decisions;
6. Provide counseling and preventive mediation assistance particularly in the
administration of collective agreements;
7. Monitor and exercise technical supervision over the Board’s programs being
implemented in the regional offices; and,
8. Perform such other functions as may be provided by law or assigned by the
Secretary.

TECHNICAL SUPPORT SERVICES DEPARTMENT

1. Perform primarily policy and program development and advisory

functions for the Executive Director / Deputy Executive Directors on the
administration and implementation of laws pertaining to conciliation /
mediation of labor disputes, voluntary arbitration and labor-management 5

cooperation;
2. Develop policies, plans, programs, standards, procedures, manuals of
operations and guidelines pertaining to effective mediation and
conciliation of labor disputes, voluntary arbitration and labor-
management cooperation;
3. Provide counseling and technical services in the promotion of voluntary
approaches to labor dispute prevention and settlement as well as in
administering the voluntary arbitration program;
4. Exercise technical supervision over the Board’s programs being
implemented in the Branches;
5. Coordinate and maintain linkages with other sectors and institutions as
well as other government authorities concerned with matters relative to
the prevention and settlement of labor disputes;
6. Assist the Branches in performing preventive mediation and / or
conciliation functions, and in promoting other voluntary approaches to
labor dispute prevention and settlement as well as labor-management
cooperation;
7. Conduct seminars, workshops, conferences and similar activities
necessary for the effective undertaking of its functions;
8. Perform such other functions as may be provided by law.

A. CONCILIATION / MEDIATION DIVISION

1. Formulate policies, programs, standards, procedures, manuals of

operations and guidelines relating to effective preventive mediation and
conciliation of labor disputes;
2. Assist the Branches in the implementation of the Board’s program in area
of conciliation and mediation;
3. Perform counseling services and preventive mediation and / or
conciliation functions in connection with notices of strikes and lock-outs
filed in accordance with existing rules and regulations;
4. Exercise technical supervision over its counterparts in the regional
branches;
5. Coordinate and maintain linkages with labor and management sectors and
institutions and other government authorities concerned with matters
relative to areas of concern;
6. Provide technical assistance in the preparation of proposed collective
bargaining agreements; in administering CBA and in drawing up joint
agreements;
7. Prepare and submit regular and special reports;
8. Perform such other functions as may be provided by law.
B. LABOR - MANAGEMENT COOPERATION DIVISION

1. Formulate policies, programs, standards, procedures, manuals of

operations and guidelines pertaining to labor-management cooperation
endeavors, and in the promotion of joint participation in policy and
decision-making at the plant, industry, sectoral, regional and national
levels, whenever appropriate.
2. Assist the Branches in the promotion of labor-management cooperation
programs;
3. Coordinate and maintain linkages with other sectors and institutions as 6
well as other government authorities concerned with matters relative to
areas of concern;
4. Exercise technical supervision over its counterparts in the regional
branches;
5. Conduct researches and studies on local and international trends relating
to labor-management cooperation schemes in aid of policy formulation;
6. Oversee the operations of the structure of mechanism for labor-
management cooperation to ensure their effectiveness as well as assist
employees and employers in all sectors in setting up a model structure or
mechanism for labor-management cooperation at various levels;
7. Prepare and submit regular and special reports;
8. Perform such other functions as may be provided by law.

C. VOLUNTARY ARBITRATION DIVISION

1. Formulate policies, programs, standards, procedures, manuals of

operations and guidelines pertaining to grievance handling and voluntary
arbitration;
2. Assist the Branches in the promotion and implementation / strengthening
of the voluntary arbitration program as a preferred mode of settling labor
disputes as well as other voluntary approaches towards harmonious
labor-management relations;
3. Provide technical and administrative support to the Tripartite Voluntary
Arbitration Advisory Council;
4. Administer the voluntary arbitration program; maintain a nationwide list
of voluntary arbitrators; and compile and analyze arbitration awards and
decisions;
5. Conduct researches and studies on local and international trends relating
to voluntary arbitration in aid of policy formulation;
6. Coordinate researches and studies on local and international trends
relating to voluntary arbitration in aid of policy formulation;
7. Prepare and submit regular and special reports; and
8. Perform such other functions as may be provided by law.

TRIPARTITE VOLUNTARY ARBITRATION ADVISORY COUNCIL

This is attached to the NCMB per Sec. 4 of EO 251 dated 25 July 1987. The
Council advises the NCMB on matters pertaining to the promotion of voluntary
arbitration as the preferred mode of dispute settlement.

It is composed of the Executive Director of the NCMB who acts as Chairman,

one other member from the government, two members representing labor, and two
other members representing management. The members are all appointed by the
President to serve a term of three (3) years, without compensation.
NCMB REGIONAL BRANCHES

1. Implement laws, rules and regulations, policies, programs, standards,

manuals of operations and guidelines issued by the Board within its
jurisdiction;
2. Undertake preventive mediation and conciliation functions;
3. Promote and administer the voluntary arbitration program and other
voluntary modes of preventing and settling labor disputes and grievances
handling;
4. Promote labor-management cooperative endeavors as well as schemes for 7
joint labor-management participation in policy and decision making;
5. Provide counseling and technical assistance to parties in the prevention
and settlement of labor disputes including the administration of collective
agreements;
6. Coordinate and maintain linkages with concerned sectors, institutions and
other government authorities on matters relative to the prevention and
settlement of labor disputes;
7. Prepare and submit regular and special reports of accomplishment and
labor relations situations to the Board’s Central Office;
8. Perform other functions as may be provided by law.

Jurisdiction of Voluntary Arbitrators

Jurisdiction of Voluntary Arbitrators or Panel of Voluntary Arbitrators (Art.

261-262, Labor Code)
Exclusive and original jurisdiction to hear and decide all grievances:

1. Arising from the implementation or interpretation of the collective

bargaining agreements;
2. Arising from the interpretation or enforcement of company personnel
policies;
3. Wage distortion issues arising from the application of any wage
orders in organized establishments (Par. 4, Art. 124, RA 6727);
“Where the application of any prescribed wage increase by virtue of a law
or Wage Order issued by any Regional Board results in distortions or wage
structure within an establishment, the employer and the union shall negotiate to
correct the distortions. Any dispute arising from wage distortion shall be resolved
through the grievance procedure under their collective bargaining agreement and,
if it remains unresolved, through voluntary arbitration. Unless otherwise agreed
by the parties in writing, such dispute shall be decided by the voluntary
arbitrators within ten (10) calendar days from the time said dispute was referred
to voluntary arbitration.”
4. Unresolved grievances arising from the interpretation and
implementation of the productivity incentive programs under RA 6971.

Sec. 9, RA 6971

Sec. 9. Disputes and Grievances – Whenever disputes, grievances, or other

matters arise from the interpretation or implementation of the productivity
incentive program, the labor-management committee shall meet to resolve the
dispute, and may seek the assistance of the National Conciliation and Mediation
Board of the Department of Labor and Employment for such purpose. Any dispute
which remains unresolved within twenty (20) days from the time of its submission
to the labor-management committee shall be submitted for voluntary arbitration in
line with the pertinent provisions of the Labor Code as amended.
The Productivity incentives program shall include the name(s) if the voluntary
arbitrator or panel of voluntary arbitrators previously chosen and agreed upon by
the labor-management committee.
Concurrent Jurisdiction

Any other labor dispute upon agreement of the party may be submitted to a
voluntary arbitrator or panel of voluntary arbitrators. Before or at any stage of the
compulsory arbitration process, the parties may opt to submit to their dispute to
voluntary arbitration.

The NLRC and its Regional Branches as well as the Regional Directors of the
DOLE are prohibited from entertaining disputes, grievances or matters under the
exclusive and original jurisdiction of the voluntary arbitrator or panel of voluntary 8
arbitrators. They shall immediately dispose and refer the same to the appropriate
grievance machinery or voluntary arbitration provided in the collective bargaining
agreement.

Powers of the Voluntary Arbitrators or Panel of Voluntary Arbitrators (Sec. 4, Rule

XI, Book V)
1. To hold hearings;
2. To receive evidence;
3. To take whatever action is necessary to resolve the issue/s subject of
the dispute;
4. To conciliate or mediate to aid the parties in reaching a voluntary
settlement of the dispute; and
5. To issue a writ of execution to enforce final decisions, orders,
resolutions or awards.

[Source: NCMB Website]

 The Philippine Overseas Employment Administration

The POEA regulates the private sector participation in the recruitment and overseas
placement of workers through its licensing and registration system. It has issued the Rules
and Regulations Governing Overseas Employment, recently revised on 04 February 2002.

What are the functions of this agency?

Sec. 23, paragraph (b.1) of Republic Act. No. 8042, otherwise known as the Migrant
Workers and Overseas Filipinos Act of 1995 [as further amended by R.A. 10022] is hereby 9
amended to read as follows:

(b.1) Philippine Overseas Employment Administration - The Administration

shall regulate private sector participation in the recruitment and overseas
placement of workers by setting up a licensing and registration system. It shall
also formulate and implement, in coordination with appropriate entities
concerned, when necessary, a system for promoting and monitoring the
overseas employment of Filipino workers taking into consideration their
welfare and the domestic manpower requirements.

The Adjudicatory Function of POEA

Under its Rules Governing Overseas Employment (revised in 2002), POEA

has original and exclusive jurisdiction to hear and decide the following kinds of
cases:

Jurisdiction and Venue

Section 1.Jurisdiction. The Administration shall exercise original and exclusive jurisdiction
to hear and decide all cases which are administrative in character, involving or
arising out of violations of recruitment rules and regulations including refund of
fees collected from workers and violation of the conditions for issuance of license to
recruit workers.

Section 2. Grounds for imposition of administrative sanctions:

a. Charging, imposing or accepting directly or indirectly, any amount of money goods

or services, or any fee or bond for any purpose whatsoever before employment is
obtained for an applicant worker;
b. Charging or accepting directly or indirectly any amount greater than that specified
in the schedule of allowable fees prescribed by the Secretary, or making a worker
pay any amount greater than that actually received by him as a loan or advance;
c. Charging or collecting placement fee for deployment to countries where the
prevailing system, either by law, policy or practice, do not allow the charging or
collection of placement and recruitment fees.
d. Collecting any fee from a worker without issuing the appropriate receipt clearly
showing the amount paid and the purpose for which payment was made;
e. Engaging in acts of misrepresentation in connection with recruitment and
placement of workers, such as furnishing or publishing any false notice, information
or document in relation to recruitment or employment;
f. Inducing or attempting to induce an already employed worker to transfer from or
leave his employment for another unless the transfer is designed to liberate a
worker from oppressive terms and conditions of employment;
g. Influencing or attempting to influence any person or entity not to employ any
worker who has not applied for employment through his agency;
 h. Obstructing or attempting to obstruct inspection by the Secretary, the Administrator
or their duly authorized representatives;
i. Substituting or altering to the prejudice of the worker, employment contracts
approved and verified by the Department from the time of actual signing thereof by
the parties up to and including the period of the expiration of the same without the
approval of the Department:
j. Failure to submit reports related to overseas recruitment and employment within
the specified time, as may be required by the Secretary or the Administration;
k. For the owner, partner, or officer of any licensed agency to become an officer or
member of the Board of any corporation or partnership engaged directly or 10
indirectly in the management of a travel agency;
l. Withholding or denying travel or other pertinent documents from workers for
considerations other than those authorized under existing laws and regulations;
m. Engaging in recruitment activities in places other than that specified in the license
without previous authorization from the Administration;
n. Appointing or designating agents, representatives or employees without prior
approval from the Administration;
o. Falsifying or altering travel documents of applicant worker in relation to overseas
recruitment activities;
p. Deploying workers whose employment and travel documents were not processed
by the Administration or those agencies authorized by it;
q. Deploying workers to principals not accredited /registered by the Administration;
r. Failure to deploy a worker within the prescribed period without valid reason;
s. Disregard of orders, notices and other legal processes issued by the Administration;
t. Coercing workers to accept prejudicial arrangements in exchange for certain
benefits that rightfully belong to the workers;
u. Withholding of workers’ salaries or remittances without justifiable reasons or
shortchanging of remittances;
v. Deploying underage workers;
w. Engaging in act/s of misrepresentation for the purpose of securing a license or
renewal thereof, such as giving false information or documents;
x. Engaging in the recruitment or placement of workers in jobs harmful to public
health or morality or to the dignity of the Republic of the Philippines;
y. Transfer or change of ownership of a single proprietorship licensed to engage in
overseas employment;
z. Failure to reimburse expenses Incurred by the worker in connection with his
documentation and processing for purposes of deployment, where deployment
does not take place without the worker’s fault;
aa. Failure to comply with the undertaking to deploy the required number of workers
within the period provided in these Rules;
bb. Failure to comply with the undertaking to provide Pre-Departure Orientation
Seminar to workers;
cc. Non-compliance with any other undertaking in connection with the issuance or
renewal of the license;
dd. Allowing persons who are otherwise disqualified to participate in the overseas
employment program under existing laws, rules and regulations to participate in the
management and operation of the agency; and
ee. Violation of other pertinent provisions of the Code and other relevant laws, rules
and regulations, guidelines and other issuances on recruitment and placement of
workers for overseas employment and the protection of their welfare;

Section 3.Venue. Any complaint arising out of recruitment violation or violation of

conditions of license may be filed with the Adjudication Office of this Administration
or at the POEA Regional Centers/Extension Units exercising territorial jurisdiction
over the place where the complainant was recruited at the option of the
complainant. The Office with which the complaint was first filed shall take
cognizance of the case.
 Where the complainant was recruited within the National Capital Region, the
complaint shall be filed with the Adjudication Office of the Administration.

In the case of reports received by the Administration, the report shall be

investigated by the Adjudication Office, or by the appropriate Regional
Center/Extension Unit of the Administration.

However, the venue of cases filed with the Adjudication Office of the Administration
may be transferred to the POEA Regional Center/Extension Unit before the
respondent files its answer upon request of either party and approved by the 11
Administration.

For the purpose of hearing and receiving of evidence, the DOLE Regional Office
exercising territorial jurisdiction over the place where the complainant was
recruited may be deputized by the Secretary of Labor to take cognizance of the
case for submission of its findings and recommendations to the Administrator.

Jurisdiction Transferred to NLRC

The allocation of jurisdiction enumerated above has been partially changed by RA.
No. 8042 or the “Migrant Workers and Overseas Filipinos Act of 1995’ as amended by RA
No. 10022. This law has transferred to the NLRC the jurisdiction over employer-employee
cases. Insofar as pertinent, its Section 10 provides:

SEC. 10. Money Claims. — Notwithstanding any provision of law to the

contrary, the Labor Arbiters of the National Labor Relations Commission
(NLRC) shall have the original and exclusive jurisdiction to hear and decide,
within ninety (90) calendar days after the filing of the complaint, the claims
arising out of an employer-employee relationship or by virtue of any law or
contract involving Filipino workers for overseas deployment including
claims for actual, moral, exemplary and other forms of damages.

The liability of the principal/employer and the

recruitment/placement agency for any and all claims under this section shall
be joint and several. This provision shall be incorporated in the contract for
overseas employment and shall be a condition precedent for its approval.
The performance bond to be filed by the recruitment/placement agency, as
provided by law, shall be answerable for all money claims or damages that
may be awarded to the workers. If the recruitment/placement agency is a
juridical being, the corporate officers and directors and partners as the case
may be, shall themselves be jointly and solidarily liable with the corporation
or partnership for the aforesaid claims and damages.

Such liabilities shall continue during the entire period or duration of

the employment contract and shall not be affected by any substitution,
amendment or modification made locally or in a foreign country of the said
contract.

As such, whenever such a claim is filed with the agencies involved in the resolution
of grievances of OFWs, the same must undergo the initial stages of conciliation and
mediation. The main problem encountered in such instances however are the provision of
these laws which states:

“In case of termination of overseas employment without just, valid or

authorized cause as defined by law or contract, the workers shall be entitled
to the full reimbursement of his placement fee with interest of twelve
percent (12%) per annum, plus his salaries for the unexpired portion of his
employment contract or for three (3) months for every year of the
unexpired term, whichever is less.”
 In Serrano v. Gallant Maritime Services, Inc. and Marlow Navigation Co., Inc., this
court ruled that the clause in Sec. 10 of R.A. 8042 "or for three (3) months for every year of
the unexpired term, whichever is less” is unconstitutional for violating the equal protection
clause and substantive due process.

A statute or provision which was declared unconstitutional is not a law. It "confers

no rights; it imposes no duties; it affords no protection; it creates no office; it is inoperative
as if it has not been passed at all."

Despite such pronouncement of the Supreme Court, Congress enacted R.A. 10022, 12
containing the same clause "or for three (3) months for every year of the unexpired term,
whichever is less". Thus, in a succeeding case, SAMEER OVERSEAS PLACEMENT AGENCY,
INC. vs. JOY C. CABILES, G.R. No. 170139 August 5, 2014, again the Supreme Court said:

“Thus, when a law or a provision of law is null because it is

inconsistent with the Constitution, the nullity cannot be cured by
reincorporation or reenactment of the same or a similar law or provision. A
law or provision of law that was already declared unconstitutional remains
as such unless circumstances have so changed as to warrant a reverse
conclusion.

We reiterate our finding in Serrano v. Gallant Maritime that limiting

wages that should be recovered by an illegally dismissed overseas worker to
three months is both a violation of due process and the equal protection
clauses of the Constitution.”

Jurisdiction Retained With POEA

Even after the passage of RA. No. 8042 and subject to the plan to phase out
POEA’s regulatory functions, the POEA retains original and exclusive jurisdiction to
hear and decide:

(a) all cases which are administrative in character, involving or arising out of
violations of rules and regulations relating to licensing and registration of
recruitment and employment agencies or entities; and
(b) disciplinary action cases and other special cases which are administrative in
character, involving employers, principals, contracting partners and Filipino
migrant workers. (Sec. 28, Rules Implementing the Migrant Workers’ Act dated
February 29, 1996.)

REVISED POEA RULES AND REGULATIONS GOVERNING THE RECRUITMENT AND

EMPLOYMENT OF LANDBASED OVERSEAS FILIPINO WORKERS OF 2016

RULE X Illegal Recruitment

SECTION 76.Acts Constituting Illegal Recruitment. — Illegal Recruitment shall mean

any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or
procuring workers and includes referrals, contract services, promising or
advertising for employment abroad, whether for profit or not, when undertaken
by a non-licensee or non-holder of authority contemplated under Article 13(f) of
Presidential Decree No. 442, as amended, otherwise known as the Labor Code of
the Philippines: Provided, that any such non-licensee or non-holder who, in any
manner, offers or promises for a fee employment abroad to two or more persons
shall be deemed so engaged. It shall likewise include the following prohibited
acts committed by any person whether or not a licensee or a holder of authority:
a. To charge or accept directly or indirectly any amount greater than that specified
in the schedule of allowable fees prescribed by the Secretary or to make a
worker pay the recruiter or its agents or acknowledge any amount greater than
that actually loaned or advanced to him;
b. To furnish or publish any false notice or information or document in relation to
recruitment or employment;
c. To give any false notice, testimony, information or document or commit any act
of misrepresentation for the purpose of securing a license or authority under the
Labor Code;
d. To give any false notice, testimony, information or document or commit any act 13
of misrepresentation for the purpose of documenting hired workers with the
POEA, which include the act of reprocessing workers through a job order that
pertains to non-existent work, work different from the actual overseas work, or
work with a different employer whether registered or not with the POEA;
e. To induce or attempt to induce a worker already employed to quit his/her
employment in order to offer him another unless the transfer is designed to
liberate a worker from oppressive terms and conditions of employment;
f. To influence or attempt to influence any person or entity not to employ any
worker who has not applied for employment through his/her agency or who has
formed, joined or supported, or has contacted or is supported by any union or
workers’ organization;
g. To engage in the recruitment or placement of workers in jobs harmful to public
health or morality or to the dignity of the Republic of the Philippines as may be
prohibited by law or duly constituted authority;
h. To obstruct or attempt to obstruct inspection by the Secretary or by his/her duly
authorized representative;
i. To fail to submit reports on the status of employment, placement vacancies,
remittance of foreign exchange earnings, separation from jobs, departures and
such other matters or information as may be required by the Secretary under
penalty of law;
j. To substitute or alter to the prejudice of the worker, employment contract
approved and verified by the DOLE from the time of actual signing thereof by the
parties up to and including the period of the expiration of the same without the
approval of the DOLE;
k. For an officer or agent of a recruitment or placement agency to become an
officer or member of the Board of any corporation engaged in travel agency or
insurance agency or to be engaged directly or indirectly in the management of a
travel agency or insurance agency;
l. To withhold or deny travel documents from applicant workers before departure
for monetary or financial considerations, or for any other reasons, other than
those authorized under the Labor Code and its implementing rules and
regulations;
m. To fail to actually deploy a contracted worker without valid reason as
determined by the DOLE;
n. To fail to reimburse expenses incurred by the worker in connection with his/her
documentation and processing for purposes of deployment, in cases where the
deployment does not actually take place without the worker's fault;
o. To allow a non-Filipino citizen to head or manage a recruitment agency;
p. To arrange, facilitate or grant a loan to an Overseas Filipino Worker with interest
exceeding eight percent (8%) per annum, which will be used for payment of legal
and allowable placement fees and make the migrant worker issue, either
personally or through a guarantor or accommodation party, postdated checks in
relation to the said loan;
q. To impose a compulsory and exclusive arrangement whereby an Overseas
Filipino Worker is required to avail of a loan only from specifically designated
institutions, entities or persons;
r. To refuse to condone or renegotiate a loan incurred by an Overseas Filipino
Worker after the latter’s employment contract has been prematurely terminated
through no fault of his/her own;
 s. To impose a compulsory and exclusive arrangement whereby an Overseas
Filipino Worker is required to undergo health examinations only from
specifically designated medical clinics, institutions, entities or persons, except in
the case of a worker whose medical examination cost is shouldered by the
principal;
t. To impose a compulsory and exclusive arrangement whereby an Overseas
Filipino Worker is required to undergo training, seminar, instruction or
schooling of any kind only from specifically designated institutions, entities or
persons, except for recommendatory trainings mandated by principals where
the latter shoulder the cost of such trainings; 14
u. For a suspended recruitment agency to engage in any kind of recruitment
activity including the processing of pending workers’ applications; and
v. For a recruitment agency or a foreign principal/employer to pass on to the
Overseas Filipino Worker or deduct from his/her salary the payment of the cost
of insurance fees, premium or other insurance related charges, as provided
under the compulsory worker’s insurance coverage.

What other causes of action are available for an aggrieved person in this case?

SECTION 77. Independent Administrative Action.— The institution of criminal

action is without prejudice to any administrative action against the licensee or holder of
authority cognizable by the Administration, which could proceed independently of the
criminal action.

Employer – Employee Relations Cases:

Violation of terms& conditions of employment

1. Disputes relating to implementation & interpretation of employment contracts
2. Violation /non-compliance w/ any compromise agreement entered into by &
between parties in an overseas employment contract.

Suspension / Revocation of License Cases

1. Violation of the conditions of license;
2. Engaging in acts of misrepresentation for the purpose of securing a license or
renewal thereof;
3. Engaging in recruitment or placement of workers in jobs harmful to public
health or morality or to the dignity of the Republic of the Philippines;
4. Incurring an accumulated 3 counts of suspension by an agency based on final &
executory orders w/in validity period of its license.

Seafarer’s compensation due to death, disease and injury

The Supreme Court, in a litany of cases, had always held that the POEA Standard
Seafarers’ Employment Contract is supplemented by the CBA between the owner of the
vessel and the covered seaman.”

Section 20(B)(3) of the POEA-SEC provides:

Upon sign-off from the vessel for medical treatment, the seafarer is entitled to
sickness allowance equivalent to his basic wage until he is declared fit to work or the
degree of permanent disability has been assessed by the company-designated physician
but in no case shall this period exceed one hundred twenty (120) days.
x xxx

If a doctor appointed by the seafarer disagrees with the assessment, a third doctor
may be agreed jointly between the Employer and the seafarer. The third doctor’s decision
shall be final and binding on both parties.
 On the other hand, the CBA may have a provision that states:

The degree of disability which the employer, subject to this Agreement, is liable to
pay shall be determined by a doctor appointed by the Employer. If a doctor appointed by
the seafarer and his Union disagrees with the assessment, a third doctor may be agreed
jointly between the Employer and the Seafarer and his Union, and the third doctor’s
decision shall be final and binding on both parties.

The POEA-SEC and the CBA therefore govern the employment relationship between
the parties. The two instruments are the law between them. They are bound by their 15
terms and conditions, particularly in relation to the mechanism prescribed to determine
liability for a disability benefits claim. “The POEA Contract, of which the parties are both
signatories, is the law between them and as such, its provisions bind both of them.”
-=o0o=-

The Overseas Workers Welfare Administration (OWWA)

The OWWA focuses on the welfare of the OFWs and their families. It is present in all
three stages of migration: pre-departure, on-site, and upon arrival. Before the first-time
workers leave, OWWA educates them on the realities of overseas work. They also undergo
basic language training. Abroad, OWWA assists the OFWs whenever they encounter
concerns with their employers. Finally, when the OFW is back, OWWA is ready with its
livelihood trainings and programs for the OFWs’ reintegration.

Among its primary objectives are:

a. Protect the interest and promote the welfare of OFWs in recognition of their valuable
contribution to the overall development effort;
b. Facilitate the implementation of the provisions of the Labor Code concerning the
responsibility of the government to promote the well-being of OFWs;
c. Provide social and welfare services to OFWs, including insurance, social work assistance,
legal assistance, cultural services, and remittance services;
d. Ensure the efficiency of collection and the viability and sustainability of the fund through
sound and judicious investment and fund management policies;
e. Undertake studies and researches for the enhancement of their social, economic and
cultural well-being; and
f. Develop, support and finance specific projects for the welfare of OFWs.

This agency also implements the SEnA Procedures for any and all Requests for
Assistance in relation to the foregoing functions and services.
 The Occupational Safety and Health Center

Mission/Mandate

 The protection of workers through the preventive approach of reducing/eliminating

occupational accidents and illnesses.
 The promotion of workers' welfare through the effective implementation of OSH
programs that will enhance productivity and subsequently contribute to national
economic development efforts.
16
Functions

 Undertake continuing studies and researches on occupational safety and health.

 Plan, develop and implement occupational safety and health training programs.
 Serve as clearing house for occupational safety and health information, methods,
techniques, and approaches; and, institute an information dissemination
mechanism.
 Monitor work environment and conduct medical examinations of workers.
 Serve as duly recognized agency for testing and setting standard specifications of
Personal Protective Equipment and other safety devices.
 Assist other GO's in policy and standards formulation on occupational safety and
health matters; issue technical guidelines for prevention of occupational disease and
accidents.
 Enlist assistance of GO's and NGO's in achieving the objectives of the Center.
 Perform such other acts appropriate for attainment of the above functions and
enforcement of the provisions of Executive Order 307.

[SOURCE: OHSC Website]

 EMPLOYEES’ COMPENSATION COMMISSION AND STATE INSURANCE FUND

The ECC is a government corporation. It is attached to the Department of Labor and

Employment for policy coordination and guidance.

It is a quasi-judicial corporate entity created to implement the Employees’

Compensation Program (ECP). The ECP provides a package of benefits for public and
private sector employees and their dependents in the event of work-connected
contingencies such as sickness, injury, disability or death.
17
The ECC is a government corporation. It is attached to the Department of Labor and
Employment for policy coordination and guidance.

It is a quasi-judicial corporate entity created to implement the Employees’

Compensation Program (ECP). The ECP provides a package of benefits for public and
private sector employees and their dependents in the event of work-connected
contingencies such as sickness, injury, disability or death.

As implementor of the Employees Compensation Program, ECC is mandated by law to

provide meaningful and appropriate compensation to workers. Its main functions are:

 To formulate policies and guidelines for the improvement of the employees'

compensation program;
 To review and decide on appeal all EC claims disapproved by the Systems; and
 To initiate policies and programs toward adequate occupational health and
safety and accident prevention in the working environment

Under P.D. 626, the ECC has the following powers and functions:

1. To assess and fix a rate of contributions from all employers;

2. To determine the rate of contribution payable by an employer whose records
show a high frequency of work accidents or occupational disease due to
failure by the said employer to observe adequate measures;
3. To approve rules and regulations governing the processing of claims and the
settlement of disputes prescribed by the System;
4. To initiate, rationalize and coordinate the policies of the Employees
Compensation Program;
5. To initiate policies and programs toward adequate occupational health and
safety and accident prevention in the working environment, rehabilitation and
other related programs and activities, and to appropriate funds therefore;
6. To make necessary actuarial studies and calculations concerning the grant of
constant help and income benefits for permanent disability or death, and the
rationalization of the benefits for permanent disability and death with benefits
payable by the System for similar contingencies;
7. To upgrade benefits and add new ones subject to approval of the President of
the Philippines;
8. To determine and approve additional occupational diseases and work-related
illnesses with specific criteria based on peculiar hazards of employment; and
9. To review and decide appealed cases.

Who are covered under the Employees’ Compensation Program?

1. Private sector workers who are compulsory members of the Social Security
System (SSS) and sea-based Overseas Filipino Workers (OFWs).
2. Government sector employees who are members of the Government service
Insurance System (GSIS), including members of the Armed Forces of the
Philippines, elective government officials who are receiving regular salary and all
casual, emergency, temporary and substitute or contractual employees.
When shall coverage of the employees under the Employees’ Compensation
Program start?Employees shall be covered starting on the first day of their
employment.

When is sickness or injury compensable under the Employees’ Compensation

Program?

For the sickness and the resulting disability or death to be compensable, the sickness
must be the result of an occupational disease listed under Annex “A” of the Amended 18
Rules on Employees’ Compensation with the conditions set therein satisfied, otherwise,
proof must be shown that the risk of contracting the disease is increased by the working
conditions.

For the injury and the resulting disability or death to be compensable, the injury must be
the result of accident arising out of and in the course of the employment.

What are the benefits under the Employees’ Compensation Program?

The benefits are the following:

1. Loss-of-income benefits;
2. Medical services, appliances and supplies;
3. Carers’ allowance;
4. Rehabilitation services;
5. Death benefits;
6. Funeral benefits

In case an employee dies, who shall receive the income benefits to which he is
entitled to?His/her beneficiaries.

Who are the employees’ beneficiaries?The beneficiaries shall be either primary or

secondary, and determined at the time of employee’s death.

The following beneficiaries shall be considered primary:

a. The legitimate spouse living with the employee at the time of the employee’s
death until he remarries; and
b. Legitimate, legitimated, legally adopted or acknowledged natural children, who
are unmarried, not gainfully employed, not over 21 years of age, or over 21 years
of age provided he is incapacitated and incapable of self-support due to physical
or mental defect which is congenital or acquired during minority.

The following beneficiaries shall be considered secondary:

a. The legitimate parents wholly dependent upon the employee for regular support;
b. The legitimate descendants and illegitimate children who are unmarried, not
gainfully employed, not over 21 years of age, or over 21 years of age provided he
is incapacitated and incapable of self-support due to physical or mental defect
which is congenital or acquired during minority.

Primary beneficiaries shall have priority claim to death benefits over secondary
beneficiaries. Whenever there are primary beneficiaries, no death benefit shall be
paid to his secondary beneficiaries.
When shall EC claims be filed?

EC claims must be filed within a period of three years from:

 In case of sickness, from the time the employee was unable to report for work;
 In case of injury, from the time of the incident;
 In case of death, from the date of death.

The filing of disability or death benefits either under the SSS law or the GSIS law within
three years from the time the cause of action accrued would stop the running of the 19
prescriptive period.

Where are EC claims filed?

All EC claims may be filed by the claimant at his option in the GSIS Regional Office (for
the public sector) or SSS Branch (for the private sector) nearest to his place of work or
residence.

What if my EC claim was denied at the GSIS or the SSS?

He/she may file a request for reconsideration with the GSIS or SSS main office. If still
denied, the claimant can write a letter of appeal to the Employees’ Compensation
Commission.

What is the ECC-QRP?

The Employees’ Compensation Commission Quick Response Team Program is an

immediate assistance extended to help workers who suffer from work-connected
contingencies or their families who have to deal with work accidents or sudden onset of
occupational disease or death, in the form of psycho-social counselling and assistance in
the filing of EC claim with the GSIS or the SSS.

Who are covered under the ECC-QRP? All Employees’ Compensation (EC) members.

What are the benefits and services provided by the ECC-QRP?

1. Psycho-social counseling and stress-debriefing to victims and their families to

help them cope with the contingency.
2. Information on the Employees’ Compensation Program (ECP) and the ECC-Quick
Response Team Program.
3. Assistance in the processing of EC requirements.
4. Facilitation on the prompt release/Payment of the EC benefits to
worker/beneficiary.

What is the ECC’s KaGabay Program?

The Employees’ Compensation Commission Katulong at Gabay sa Manggagawang may

Kapansanan or KaGabay Program is a special economic assistance program for
occupationally-disabled workers (ODWs) who lost employment by reason of work-
related sickness or injury.

Who may qualify under the KaGabay Program?

EC members with approved EC disability benefits.

What are the benefits and Services of the KaGabay program?

1. Physical restoration which refers to the provision of physical or occupational

therapy services to ODWs including medical appliances.
2. Skills Training for re-employment so that the ODW can acquire new skills but
subject to the ODWs potentials and residual functional capacity.
3. Entrepreneurial Training to accredited training institutions to enable the ODW to
set up home-based business.

[SOURCE: ECC Official Website] 20

MEANING OF “ARISING OUT OF” AND “IN THE COURSE OF” THE EMPLOYMENT

The words “arising out of” refer to the origin or cause of the accident and are
descriptive of its character, while the words “in the course of” refer to the time, place, and
circumstances under which the accident takes place.

The more conservative view is that the causative risk or danger must be inherent
in or essentially connected with the employment itself.

The more liberal view states that an injury may be regarded as arising out of the
employment if it results from a risk or danger to which the workman is exposed by reason
of being engaged in the performance of his duties, although such danger is not inherent in
and has no necessary or essential connection with the particular employment. This is more
in conformity with the statement that an accident arises out of the employment if it ensues
from a risk reasonably incident to the employment, and if it is in some sense due to the
employment. Under this view, an injury arises out of the employment if the employment is
one of the contributing causes without which the accident which actually happened would
not have happened. (82 Am. Jur. 2d, Sec 2)

The two components of the coverage formula – “arising out of” and “in the course of
employment” – are said to be separate tests which must be independently satisfied;
however, it should not be forgotten that the basic concept of compensation coverage
is unitary, not dual, and is best expressed in the word, “work connection.” An
uncompromising insistence on an independent application of each of the two portions of
the test can, in certain cases, exclude clearly work-connected injuries.

Thus, in cases as these the Government Service and Insurance System and the Social
Security System have their own procedures in resolving these claims.

Under the GSIS Rules, this provision appears:

"SEC. 30.Settlement of Disputes. - The GSIS shall have original and exclusive
jurisdiction to settle any disputes arising under this Act and any other laws
administered by the GSIS.

The Board may designate any member of the Board, or official of the GSIS
who is a lawyer, to act as hearing officer to receive evidence, make findings of
fact and submit recommendations, together with all documentary and
testimonial evidence to the Board within thirty (30) working days from the
time the parties have closed their respective evidence and filed their last
pleading. The Board shall decide the case within thirty (30) days from the
receipt of the hearing officer’s findings and recommendations. The cases
heard directly by the Board shall be decided within thirty (30) working days
from the time they are submitted by the parties for decision.
 Similarly, under Social Security System, they have their own way of resolving such
conflicts:

"SEC. 5.Settlement of Disputes. - (a) Any dispute arising under this Act with respect
to coverage, benefits, contributions and penalties thereon or any other matter related
thereto, shall be cognizable by the Commission, and any case filed with respect thereto
shall be heard by the Commission, or any of its members, or by hearing officers duly
authorized by the Commission and decided within twenty (20) days after the submission of
the evidence. The filing, determination and settlement of disputes shall be governed by the
rules and regulations promulgated by the Commission. 21

-=o0o=-
 THE PROFESSIONAL REGULATION COMMISSION

The Professional Regulation Commission is responsible for the administration,

implementation and enforcement of regulatory policies on the regulation and licensing of
various professions and occupations under its jurisdiction. It is the instrument of the
Filipino people in securing for the nation a reliable, trustworthy, and progressive system of
developing professionals whose personal integrity and spiritual values are solid and
respected, whose competencies are globally competitive, and whose commitment to serve
the Filipino nation and the whole community is strong and steadfast.
22
Legal and Other Regulatory Services

1. Whenever the Professional Regulation Commission receives a complaint under oath,

the commission is empowered by law to initiate an investigation of any person,
whether a private individual or professional, local or foreign, for any of the
following:
a) Practice of the regulated profession without being authorized by law or
without being registered with and licensed by the concerned regulatory
board and issued the corresponding license or temporary/special permit.
b) Committing any of the prohibited acts provided in the regulatory laws of the
various professions.

In the resolution of these issues, the PRC also implements the SEnA Procedures.
-=o0o=-

The Technical Education and Skills Development Authority

TESDA is mandated to:

1. Integrate, coordinate and monitor skills development programs;

2. Restructure efforts to promote and develop middle-level manpower;
3. Approve skills standards and tests;
4. Develop an accreditation system for institutions involved in middle-level
manpower development;
5. Fund programs and projects for technical education and skills development; and
6. Assist trainers training programs.

At the same time, TESDA is expected to:

1. Devolve training functions to local governments;
2. Reform the apprenticeship program;
3. Involve industry/employers in skills training;
4. Formulate a skills development plan;
5. Develop and administer training incentives;
6. Organize skills competitions; and
7. Manage skills development funds.

Overall, TESDA formulates manpower and skills plans, sets appropriate skills
standards and tests, coordinates and monitors manpower policies and programs,
and provides policy directions and guidelines for resource allocation for the TVET
institutions in both the private and public sectors.

Today, TESDA has evolved into an organization that is responsive, effective and
efficient in delivering myriad services to its clients. To accomplish its multi-pronged
mission, the TESDA Board has been formulating strategies and programs geared
towards yielding the highest impact on manpower development in various areas,
industry sectors and institutions.
 Mandate

The Technical Education and Skills Development Authority (TESDA) is the

government agency tasked to manage and supervise technical education and skills
development (TESD) in the Philippines. It was created by virtue of Republic Act 7796,
otherwise known as the “Technical Education and Skills Development Act of 1994”.
The said Act integrated the functions of the former National Manpower and Youth
Council (NMYC), the Bureau of Technical-Vocational Education of the Department of
Education, Culture and Sports (BTVE-DECS) and the Office of Apprenticeship of the
Department of Labor and Employment (DOLE). 23
[SOURCE: TESDA Website]

Just like in regular and organized establishments or companies, there is also a sort
of a Grievance Machinery which shall be resorted to in the event that there shall arise
disputes out of the Apprenticeship Agreements. Such disputes shall be referred to the
Plant Apprenticeship Committee. Ideally, this committee is composed of a three-
party membership – meaning, representatives from the management, labor and the
government. Should this be unattainable, then at least there should be some technical
personnel in the plant, trade or industry concerned, and labor and management
representatives. The same rules and procedures as outlined in the Grievance Machinery
are similarly applied.
What are the issues that are subjected to this Grievance proceedings?
Violation by the employer of the rule that An apprentice may be validly dismissed by
the employer only on the following grounds:
a) Habitual absenteeism in on-the-job training and related theoretical instructions;
b) Willful disobedience of company rules or insubordination to lawful order or
superior;
c) Poor physical condition, permanent disability or prolonged illness which
incapacitates the apprentice from working;
d) Theft or malicious destruction of company property and/or equipment;
e) Poor efficiency of performance on the job or in the classroom for a prolonged
period despite warning duly given to the apprentice; and
f) Engaging in violence or other forms of gross misconduct inside the employer’s
premises.

The Apprentice’s cause the termination of the Apprenticeship Agreement on the

following valid grounds:
a. Substandard or deleterious working conditions within the employer’s premises;
b. Repeated violations by the employer of the terms of apprenticeship agreement;
c. Cruel or inhuman treatment by the employer or his subordinates;
d. Personal problems which in the opinion of the apprentice shall prevent him from
a satisfactory performance; and,
e. Bad health or continuing illness.
It must be emphasized that while these grounds are present, there must be
compliance with due process.

-=o0o=-
 The NATIONAL WAGES AND PRODUCTIVITY COMMISSION

The National Wages and Productivity Commission

Vision
Justly remunerated and productive Filipino workforce in globally competitive enterprises

Mission
Set minimum wage that protects workers' welfare.
Promote enterprise and workers' productivity 24

Mandate

NWPC is a key policy making body on wages, incomes and productivity, mandated
under RA 6727 or the Wage Rationalization Act (1989) and RA 6971 or the Productivity
Incentives Act of 1990 to:

a) Determine minimum wages at the regional,provincial and/or industry levels;

and
b) Promote productivity improvement and gainsharing schemes, particularly
among micro, small and medium enterprises.
c) NWPC formulates policies and guidelines on wages, incomes and productivity
and exercises technical and administrative supervision over the RTWPBs.
d) With 17 RTWPBs (including ARMM) responsible for setting minimum wages and
promoting productivity improvement programs.

Powers and Functions of the Commission. - The Commission shall have the following
powers and functions:

a. To act as the national consultative and advisory body to the President of the
Philippines and Congress on matters relating to wages, incomes and productivity;
b. To formulate policies and guidelines on wages, incomes and productivity im-
provement at the enterprise, industry and national levels;
c. To prescribe rules and guidelines for the determination of appropriate minimum
wage and productivity measures at the regional, provincial or industry levels;
d. To review regional wage levels set by the Regional Tripartite Wages and Pro-
ductivity Boards to determine if these are in accordance with prescribed guidelines
and development plans;
e. To undertake studies, researches and surveys necessary for the attainment of its
functions and objectives, and to collect and compile data and periodically
disseminate information on wages and productivity and other related information
including, but not limited to; employment,cost-of-living, labor costs, investments
and returns;
f. To review plans and programs of the Regional Tripartite Wages and Productivity
Boards to determine whether these are consistent with national development
plans;
g. To exercise technical and administrative supervision over the Regional Tripartite
Wages and Productivity Boards;
h. To call, from time to time, a national tripartite conference of representatives of
government, workers and employers for the consideration of measures to promote
wage rationalization and productivity; and
i. To exercise such powers and functions as may be necessary to implement this Act.

[SOURCE: RTWPC Website]

 The National Labor Relations Commission

The creation and composition of this Commission is as stated in Article 213

of the Labor Code, P.D. No. 402, as later amended by R.A. 6715 which restored
tripartite representation in the NLRC, regionalized its operations, raised the
qualifications of its members, and upgraded their salaries and those of Labor
Arbiters. R.A. 7700 amended the fourth paragraph of Article 213, providing for
concurrent jurisdiction between and among the first, second and third divisions to
further ensure speedy disposition of cases.
25
Organization [RA No. 9347, June 24, 2006]

"ART. 213. National Labor Relations Commission. - There shall be a National Labor
Relations Commission which shall be attached to the Department of Labor and
Employment SOLELY for program and policy coordination only, composed of a
Chairman and TWENTY-THREE (23) Members.

"The Commission may sit en banc or in EIGHT (8) divisions, each composed of three
(3) members. The Commission shall sit en banc only for purposes of promulgating
rules and regulations governing the hearing and disposition of cases before any of
its divisions and regional branches and formulating policies affecting its
administration and operations. The Commission shall exercise its adjudicatory and
all other powers, functions, and duties through its divisions. Of the EIGHT (8)
divisions, the first, second third, FOURTH, FIFTH AND SIXTH divisions shall handle
cases coming from the National Capital Region and other parts of Luzon; and the
SEVENTH, AND EIGHT divisions, cases from the Visayas and Mindanao, respectively:
Provided, That the Commission sitting en banc may, on temporary or emergency
basis, allow cases within the jurisdiction of any division to be heard and decided by
any other division whose docket allows the additional workload and such transfer
will not expose litigants to unnecessary additional expenses. The divisions of the
Commission shall have exclusive appellate jurisdiction over cases within their
respective territorial jurisdiction.

Mandate
The National Labor Relations Commission is a quasi-judicial body tasked to
promote and maintain industrial peace by resolving labor and management disputes
involving both local and overseas workers through compulsory arbitration and alternative
modes of dispute resolution. It is attached to the Department of Labor and Employment for
program and policy coordination.

Mission
To observe public trust as a quasi-judicial agency by way of a fair, speedy, equitable
disposition of labor cases at lesser cost.

Vision
To resolve disputes in the fairest, quickest, least expensive and most effective way possible.

Exclusive Original Jurisdiction of Labor Arbiters:

Labor Arbiters have original exclusive jurisdiction to hearand decide the following
cases involving all workers, whether agricultural or non-agricultural, except workers
employed by the government and by the government owned and controlled corporations
(GOCCs) with original charter, to wit:
1. Unfair labor practice cases, as defined by Articles 247, 248, 249, 261 and 262 in
relation to Article 217 of the Labor Code; [Note: Except those which are gross in
character, violations of a collective bargaining agreement (CBA) shall no longer be
treated as unfair labor practice under Article 251 of the Labor Code. If it involves
unresolved grievances arising from the interpretation or implementation of the CBA
and those arising from the interpretation or enforcement of company personnel
policies referred to in Article 260 of the Labor Code, the Voluntary Arbitrators
accredited by the National Conciliation and Mediation Board (NCMB) shall have
Jurisdiction over such cases. Gross violations of the CBA, which are considered to be
unfair labor practice, shall mean flagrant and/or malicious refusal TO comply with 26
the economic provisions of such agreement.]

The jurisdiction of Labor Arbiters over ULP cases is limited only to the
administrative and civil aspects of the case where he administratively determines
whether the respondent has committed the ULP complained of and whether there
shall be recovery of civil liability in said administrative proceeding. The criminal
aspect of ULP however must be lodged before the appropriate regular courts.

2. Termination disputes, such as illegal or unjust dismissals and cases involving

preventive suspensions, under Article 217 of the Labor Code, except when the
same involve unresolved grievances arising from the interpretation or
implementation of the CBA and those arising from the interpretation or
enforcement of company personnel policies under Articles 217 (c) and 261 of the
Labor Code and DOLE Policy Instruction No. 56;

3. If accompanied with a claim for reinstatement, those cases that workers

may file involving labor standards, such as wages, pay rates, working hours,
and other terms and conditions of employment under Article 217 of the
Labor Code;

{Note: If not accompanied with a claim for reinstatement, and it involves an amount
not exceeding P5,000.00, the DOLE Regional Directors shall have jurisdiction over
such cases under Article 129 of the Labor Code. However, it had been settled that the
DOLE may have jurisdiction over cases involving amounts exceeding P5,000.00 if the
case arose from its routine ocular or inspection tours.

In the fairly recent case of PEOPLE’S BROADCASTING SERVICE (BOMBO

RADYO PHILS., INC.), versus THE SECRETARY OF THE DEPARTMENT OF LABOR
AND EMPLOYMENT, THE REGIONAL DIRECTOR, DOLE REGION VII, (G.R. No.
179652, March 6, 2012), the Supreme Court laid to rest this seeming conflict of
jurisdictions in the following manner:

To recapitulate, if a complaint is brought before the DOLE to give effect to the

labor standards provisions of the Labor Code or other labor legislation, and there is
a finding by the DOLE that there is an existing employer-employee relationship, the
DOLE exercises jurisdiction to the exclusion of the NLRC. If the DOLE finds that
there is no employer-employee relationship, the jurisdiction is properly with the
NLRC. If a complaint is filed with the DOLE, and it is accompanied by a claim for
reinstatement, the jurisdiction is properly with the Labor Arbiter, under Art. 217(3)
of the Labor Code, which provides that the Labor Arbiter has original and exclusive
jurisdiction over those cases involving wages, rates of pay, hours of work, and other
terms and conditions of employment, if accompanied by a claim for reinstatement.
If a complaint is filed with the NLRC, and there is still an existing employer-
employee relationship, the jurisdiction is properly with the DOLE. The findings of
the DOLE, however, may still be questioned through a petition for certiorari under
Rule 65 of the Rules of Court.
 4. Claims for actual, moral, exemplary and other forms of damages arising
from employer-employee relations under Article 217 of the Labor Code.
These damages must be proven with preponderance of evidence, not mere
substantial evidence, as it is the provisions of the Civil Code that will govern these
claims.

5. Cases arising from any violation of Article 264 in relation to Article 217 of
the Labor Code on Prohibited Acts or Activities, including questions
involving legality of strikes and lockouts;
27
[Note: In Samahang Mangagawa sa Sulpicio Lines, et. al. v. Sulpicio Lines, GR No-
140992, March 25, 2004, the Supreme Court reiterated that the Secretary of Labor
and Employment has authority to assume jurisdiction over labor disputes over which
the Labor Arbiter has exclusive jurisdiction pursuant to Article 263 (g) of the Labor
Code, including the certification of such cases to the NLRC for compulsory
arbitration.]

6. All other claims arising from employer-employee relations under Article

217 of the Labor Code, including those of persons in domestic or household
service, involving an amount exceeding P5,000.00, regardless of whether
accompanied with a claim for reinstatement, except claims for employees
compensation, social security, medicare and maternity benefits(which are
under the exclusive original jurisdiction of the Social Security System, and the
appellate jurisdiction of the Employees Compensation Commission or the Social
Security Commission, as the case may be);

7. Cases arising from violations and enforcement of compromise agreements

in any labor dispute, including cases where the settlement was obtained
through fraud, misrepresentation or coercion, under Article 227 of the
Labor Code;

8. Upon proper indorsement by the DOLE Regional Director or Hearing Officer,

labor standard cases where the employer contests the findings of the labor
employment and enforcement officer and raises issues supported by
documentary proofs which were not considered in the course of inspection
under Article 128 (b) of the Labor Code;

9. Money claims arising out of an employer-employee relations or by virtue of

any law or contract involving migrant and overseas Filipino workers under
Section 10 of RA 8042, as amended by R.A. 10022, including claims for
actual, moral, exemplary and other forms of damages; and

10. Contempt cases, both direct and indirect, under Article 218 (d) of the Labor Code,
which authorized the NLRC to impose appropriate penalties under Rule 71 of the
Rules of Court.

Cases which DO NOT fall under the jurisdiction of the Labor Arbiters

a. JURISDICTION OVER INTRA-CORPORATE DISPUTES.

It had been held that Labor Arbiters have no jurisdiction over termination of
corporate officers and stockholders which, under the law, is considered intra-corporate
dispute. It must be emphasized that a corporate officer’s dismissal is always a corporate act
and/or intra-corporate controversy and that nature is not altered by the reason or wisdom
which the Board of Directors may have in taking such action. The Regional Trial Courts
(not SEC) now have jurisdiction under R. A. 8799 (Securities Regulation Act of 2000). The
jurisdiction of RTC includes adjudication of monetary claims of the corporate officer who
th
was dismissed, (such as unpaid salaries, leaves, 13 month pay, bonuses, etc.), damages and
attorney's fees.
 Who are Corporate officers - There are specifically three (3) officers which a
corporation must have under the statute: president, secretary, and treasurer. However, the
law does not limit corporate officers to these three. Section 25 of the Corporation Code
gives corporations the widest latitude to provide for such other offices, as they may
deem necessary. The by-laws may and usually do provide for such other officers, e.g.,
vice president, cashier, auditor, and general manager. Consequently, the Supreme
Court has held that one who is included in the by-laws of a corporation in its roster of
corporate officers is an officer of said corporation and not a mere employee.

This was applied in the case of Nacpil vs. Intercontinental Broadcasting 28

Corporation, [G. R. No. 144767, March 21, 2002], where the Court held that the position of
Comptroller is not expressly mentioned among the officers of the IBC in the by-laws is of no
moment, because the IBC’s Board of Directors is empowered under Section 25 of the
Corporation Code and under the corporation’s by-laws to appoint such other officers as it
may deem necessary.

It must be noted that the Supreme Court has held that in most cases, the “by-laws
may and usually do provide for such other officers,” and that where a corporate officer is
not specifically indicated in the roster of corporate officers in the by-laws of a corporation,
the Board of Directors may also be empowered under the by-laws to create additional
officers as may be necessary.

In a previous case, however, the Supreme Court made this distinction:

In Prudential Bank and Trust Company vs. Reyes, [G. R. No. 141093, February 20,
2001], It has been stated that “the primary standard of determining regular employment is
the reasonable connection between the particular activity performed by the employee in
relation to the usual trade or business of the employer.” Additionally, “an employee is
regular because of the nature of work and the length of service, not because of the mode or
even the reason for hiring them.” As Assistant Vice-President of the Foreign Department of
the Bank she performs tasks integral to the operations of the bank and her length of service
with the bank totaling 28 years speaks volumes of her status as a regular employee of the
bank. In fine, as a regular employee, she is entitled to security of tenure; that is, her services
may be terminated only for a just or authorized cause. The one who rose from the ranks
is a regular employee and not a mere corporate officer.

Take note, however, of the case of Renato Real vs. Sangu Philippines, Inc. and/
or Kiichi Abe, [G.R. No. 168757, January 19, 2011] where the dismissal of a Manager,
who is also a stockholder, was declared as a labor dispute, not an intra-corporate
controversy. The Supreme Court exhaustively explained such in the following
portions of the Decision:

‘To determine whether a case involves an intra-corporate controversy, and is to be

heard and decided by the branches of the RTC specifically designated by the Court to try
and decide such cases, two elements must concur: (a) the status or relationship of the
parties, and (2) the nature of the question that is the subject of their controversy.

The first element requires that the controversy must arise out of intra-corporate or
partnership relations between any or all of the parties and the corporation, partnership, or
association of which they are not stockholders, members or associates, between any or all
of them and the corporation, partnership or association of which they are stockholders,
members or associates, respectively; and between such corporation, partnership, or
association and the State insofar as it concerns the individual franchises.

The second element requires that the dispute among the parties be intrinsically
connected with the regulation of the corporation. If the nature of the controversy involves
matters that are purely civil in character, necessarily, the case does not involve an intra-
corporate controversy.’ [Citations omitted.]
 No intra-corporate relationship between the parties

As earlier stated, respondents terminated the services of petitioner for the following
reasons: (1) his continuous absences at his post at Ogino Philippines, Inc; (2) respondents’
loss of trust and confidence on petitioner; and, (3) to cut down operational expenses to
reduce further losses being experienced by the corporation. Hence, petitioner filed a
complaint for illegal dismissal and sought reinstatement, backwages, moral damages and
attorney’s fees. From these, it is not difficult to see that the reasons given by respondents
for dismissing petitioner have something to do with his being a Manager of respondent
corporation and nothing with his being a director or stockholder. 29

Certainly, what we have here is a case of termination of employment which is a

labor controversy and not an intra-corporate dispute. In sum, we hold that petitioner’s
complaint likewise does not satisfy the nature of controversy test.

With the elements of intra-corporate controversy being absent in this case, we thus
hold that petitioner’s complaint for illegal dismissal against respondents is not intra-
corporate. Rather, it is a termination dispute and, consequently, falls under the jurisdiction
of the Labor Arbiter pursuant to Section 217 of the Labor Code.

b. JURISDICTION OVER GOVERNMENT CORPORATIONS WITH ORIGINAL

CHARTERS.- Labor Arbiters have jurisdiction over cases involving employees of
government-owned or controlled corporations without original charters
(organized under the Corporation Code). They have no jurisdiction if entity has
original charter. Corporations with original charter are those created by an
enactment of Congress, i.e., by a law. The employees of these entities are covered by
the Civil Service Rules.
CASE:(Metro Transit Organization, Inc. vs. CA, G.R. No. 163881, March 24, 2006).

a. JURISDICTION OVER IMMUNED ENTITIES. - Labor Arbiters have no jurisdiction

over labor cases involving entities immuned from suit. Exception: when said entities
perform proprietary activities (as distinguished from governmental functions).

For instance, in an illegal dismissal case filed against the Asian Development Bank
(ADB), the Supreme Court ruled that it enjoys immunity from legal process of every
form and, therefore, the suit cannot prosper. ADB's officers, on their part, enjoy
immunity in respect of all acts performed by them in their official capacity. The
Charter and the Headquarters Agreement granting these immunities and privileges
are treaty covenants and commitments voluntarily assumed by the Philippine
government which must be respected. (Department of Foreign Affairs vs. NLRC, et
al., G. R. No. 113191, September 18, 1996, 262 SCRA 39, 43-44).

There is an exception to the immunity rule as exemplified by the case of United

States vs. Hon. Rodrigo, [G. R. No. 79470, Feb. 26, 1990, 182 SCRA 644, 660]. It was
held that when the function of the foreign entity otherwise immune from suit,
partakes of the nature of a proprietary activity, such as the restaurant services
offered at John Hay Air Station undertaken by the United States Government as a
commercial activity for profit and not in its governmental capacity, the case for
illegal dismissal filed by a Filipino cook working therein is well within the
jurisdiction of Philippine courts. The reason is that by entering into the employment
contract with the cook in the discharge of its proprietary functions, it impliedly
divested itself of its sovereign immunity from suit.

b. JURISDICTION OVER LOCAL WATER DISTRICTS. - The Supreme Court ruled that
local water districts are quasi-public corporations and, therefore, the dismissal of
their employees are governed by the civil service laws, rules and regulations.
 Although the Labor Arbiter has no jurisdiction, the Supreme Court, the Court did
not allow petitioner to belatedly raise the issue of jurisdiction before it,
considering that it never raised said issue before the Executive Labor Arbiter,
the NLRC or even before the Supreme Court in another related case. In fact, it
was petitioner itself which filed the complaint before the Executive Labor Arbiter
and sought affirmative relief therefrom and participated actively in the proceedings
therein. Although jurisdiction over strikes and dismissals of employees in local
water districts is lodged not with the NLRC but with the Civil Service Commission,
here, the petitioner is already estopped from assailing the jurisdiction of the NLRC
and is, therefore, bound to respect all the proceedings therein. 30

c. JURISDICTION OVER TORTS. - As earlier emphasized, Labor Arbiters and the

NLRC have no power or authority to grant reliefs from claims that do not arise from
employer-employee relations. They have no jurisdiction over quasi-delict or tort per
Article 2176 of the Civil Code that have no reasonable causal connection to any of
the claims provided for in the Labor Code, other labor statutes, or collective
bargaining agreements.

In Tolosa vs. NLRC, [G. R. No. 149578, April 10, 2003], a complaint was lodged with
the Labor Arbiter but later, the Supreme Court ruled that the Labor Arbiter has no
jurisdiction over the case because it was established that the same was in the nature
of an action based on a quasi-delict or tort, it being evident that the issue presented
therein involved the alleged gross negligence of the co-employees (shipmates) of
Captain Tolosa, the deceased husband of the complainant, with whom Captain
Tolosa had no employer-employee relationship.

SUMMARY OF OTHER ISSUES BEYOND JURISDICTION OF THE LABOR

ARBITERS OR NLRC.

In the following cases, the Supreme Court dwelt on other issues over which the
Labor Arbiter or NLRC has no jurisdiction:
1. Cases involving claims for Employees Compensation, Social Security, Medicare
and maternity benefits. (Article 217 [6], Labor Code).
2. Issue of replevin intertwined with a labor dispute. (Basaya, Jr. vs. Militante, 156
SCRA 299).
3. Cases arising from violation of training agreement. (Singapore Airlines vs. Hon.
Ernani Cruz Pano, G. R. No. L-47739, June 22, 1983; 122 SCRA 671).
4. Cases involving claim for liquidated damages for breach of a contractual
obligation as well as the issue of liability in suretyship. (Singapore Airlines vs.
Hon. Ernani Cruz Pano, G. R. No. L-47739, June 22, 1983; 122 SCRA 671).
5. Cases involving issue of whether sale of property being levied on execution was
done in bad faith. (Asian Footwear vs. Soriano, 142 SCRA 49).
6. Cases of contempt involving a judge of the regular court. (Tolentino vs. Inciong,
91 SCRA 563).
7. Cases involving an injunction filed by a third party with the regular court against
the sheriff enforcing a decision in a labor case. (Philippine Association of Free
Labor Unions [PAFLU] vs. Salas, 158 SCRA 53).
8. Cases involving claim of an employee for cash prize offered under the Innovation
Program of a company which, although arising from employer-employee
relationship, requires the application of general civil law on contracts. (San
Miguel Corporation vs. NLRC, 161 SCRA 719).
1. Cases initiated by an employer against an employee for sum of money and
damages for cost of repair jobs made on the employee’s personal cars as well as
for the purchase price of parts and vehicles. (Molave Motor Sales, Inc. vs. Laron,
129 SCRA 485).
2. Claims for commissions and certain reimbursements made by an independent
contractor. (Sara vs. Agarrado, 166 SCRA 625).
3. Cases filed by government-owned corporations performing governmental
functions. (National Housing Corporation vs. Juco, 134 SCRA 172; Metropolitan
Waterworks and Sewerage System vs. Hernandez, 143 SCRA 602; PNOC- 31
Exploration Corporation vs. NLRC, 164 SCRA 501).
4. Violation of labor laws which are penal in nature. Examples are illegal
recruitment cases, (Section 10, Rule X, Book II, Rules and Regulations Governing
Overseas Employment) or criminal offenses or felonies committed in the course
of strikes and lockouts. (Article 264, Labor Code).
5. Insolvency proceedings in the enforcement of the worker preference ordained
under Article 110 of the Labor Code.
6. Exercise of equity jurisdiction to enjoin activities for purposes of compelling an
employer to ignore a clear mandate of the law. (Bulletin Publishing Corporation
vs. Sanchez, 144 SCRA 678).
7. Administrative action against the licensee or holder of authority cognizable by
the POEA which could proceed independently from the criminal action. (Section
12, Rules and Regulations Implementing the Migrant Workers and Overseas
Filipinos Act of 1995).
8. Review of recruitment violation cases and other related cases decided by the
POEA. The Secretary of Labor and Employment has exclusive jurisdiction over
these cases. (Section 1, Rule IV, Book VI, Rules and Regulations Governing
Overseas Employment).
9. Cases involving issues which do not arise from, or has no reasonable causal
connection with, employer-employee relationship. (Pepsi-Cola Distributors vs.
Galang, 201 SCRA 695; Grepalife Assurance Corporation vs. NLRC, 187 SCRA
694; Cosmopolitan Funeral Homes vs. Maalat, 187 SCRA 773; Insular Life vs.
NLRC, 179 SCRA 459).

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