LABOR LAW

TWO MAJOR SECTIONS OF

LABOR LAW

LABOR STANDARS
LABOR RELATIONS
LABOR STANDARDS
Part of labor law which prescribes the minimum terms and
conditions of employment which the employer is required to grant
to its employees.

COVERAGE
Applies to employees in all establishments and undertakings,
whether for profit or not
EXCLUDED
a. Government employees;
b. Managerial employees;
c. Non-agricultural field personnel;
d. Domestic servants;
e. Workers who are paid by results; and
f. Members of the family of the employer
NOTE:
It is a condition sine qua non for the application of labor laws
that there is an employer-employee relationship

Identifying Employer-Employee Relationships Four Key Tests:

a. The selection and engagement of the employees;

b. The payment of wages;
c. The power of dismissal; and
d. The power to control the employees’ conduct.
BASIC PAY
Basic Salary means all the remuneration or earnings paid by an
employer to a worker for services rendered on normal working
days and hours but does not include cost-of-living allowances,
profit-sharing payments, premium payments, 13th month pay or
other monetary benefits which are not considered as part of or
integrated into the regular salary of the workers.

The following are excluded from the computation of “basic

salary”: payments for sick, vacation and maternity leaves, night
differentials, regular holiday pay and premiums for work done
on rest days and special holidays.
NORMAL HOURS OF WORK
The normal hours of work of any employee shall not exceed
eight (8} in a day.

Hours of Work - include (a) all time during which an employee is

required to be on duty or to be at a prescribed workplace; and
(b) all time during which an employee is suffered or permitted to
work.
NO WORK, NO PAY PRINCIPLE
The “no work, no pay” or “fair day’s wage for fair day’s labor”
means that if the worker does not work, he is generally not entitled
to any wage or pay. The exception is when it was the employer
who unduly prevented him from working despite his ableness,
willingness and readiness to work; or incases where he is illegally
locked out or illegally suspended or illegally dismissed, or otherwise
illegally prevented from working, in which event, he should be
entitled to his wage.
MEAL PERIODS
Every employer is required to give his employees not less than
one (1) hour (or 60 minutes) time-off for regular meals.

Meal break is not compensable hours worked. However, if he is

required to work while eating, he should be compensated therefor.
OVERTIME WORK
Service rendered in excess of eight (8) hours on ordinary
working days.

“OVERTIME PAY”
OVERTIME PAY
 EMERGENCY OVERTIME WORK
GR: No employee may be compelled to render overtime work against his will. The reason
is that this will constitute involuntary servitude.

Exception when employee may be compelled to render overtime work:

1. When the country is at war or when any other national or local emergency has been
declared by the National Assembly or the Chief Executive;
2. When overtime work is necessary to prevent loss of life or property or in case of imminent
danger to public safety due to actual or impending emergency in the locality caused by
serious incident, fire, flood, typhoons, earthquake, epidemic, or other disasters or calamities;
3. When there is urgent work to be performed on machines, installations or equipment, or in
order to avoid serious loss or damage to the employer or some other causes of similar
nature;
4. When the work is necessary to prevent loss or damage to perishable goods;
5. When the completion or continuation of work started before the 8th hour is necessary to
prevent serious obstruction or prejudice to the business or operations of the employer; and
6. When overtime work is necessary to avail of favorable weather or environmental conditions
where performance or quality of work is dependent thereon
OVERTIME PAY IS NOT SUBJECT TO A WAIVER

The right to claim overtime pay is not subject to a waiver. such right
is governed by law and not merely by the agreement of the parties.

Overtime cannot be offset by undertime because to allow offsetting

would prejudice the worker.
NIGHT SHIFT DIFFERENTIAL PAY
Every employee shall be paid a night shift differential of not less
that 10% of his regular wage for each hour worked performed
between ten o’clock in the evening and six o’clock in the
morning
COMPUTATION OF NIGHT SHIFT DIFFERENTIAL PAY
1. Where night shift (10 p.m. to 6 a.m.) work is regular work

a.) On an ordinary day: Plus 10% of the basic hourly rate or a total of 110% of the
basic hourly rate.
b.) On a rest day, special day or regular holiday: Plus 10% of the regular hourly
rate on a rest day, special day or regular holiday or a total of 110% of the regular
hourly rate.

2. For overtime work in the night shift. Since overtime work is not usually eight (8)
hours, the compensation for overtime night shift work is also computed on the
basis of the hourly rate.

a.) On an ordinary day. Plus 10% of 125% of basic hourly rate.

b.) On a rest day or special day or regular holiday. Plus 10% of 130% of regular
hourly rate on said days.
 HOLIDAY PREMIUM
Every worker shall be paid his regular daily wage during regular holidays, except
in retail and service establishments regularly employing less than ten (10) workers.

Holiday pay is a one-day pay given by law to an employee even if he does not
work on a regular holiday. This gift of a day’s pay is limited to each of the twelve
regular (also called legal) holidays. it is not demandable for any other kind of
nonworking day. Since there are twelve legal holidays in a year, there are only
twelve occasions - no more, no less - when holiday pay should be paid, except
that there are places where Muslim holidays also have to be observed.

Work performed on a legal holiday merits at least twice (200%) the daily wage
rate
REGULAR HOLIDAYS
COMPUTATION OF HOLIDAY
PREMIUM FOR REGULAR HOLIDAYS
SPECIAL NON-WORKING HOLIDAYS
 COMPUTATION OF HOLIDAY PREMIUM
FOR SPECIAL NON-WORKING HOLIDAYS
a.) If unworked -
No pay, except if there is a company policy, practice, or collective bargaining
agreement (CBA) which grants payment of wages on special days even if
unworked.
EFFECTS OF ABSENCES ON THE COMPUTATION OF
HOLIDAY PAY
1. Employees on leave of absence with pay - entitled to holiday pay when they are on
leave of absence with pay.

2. Employees on leave of absence without pay on the day immediately preceding the regular
holiday - may not be paid the required holiday pay if they have not worked on such regular
holiday.

3. Employees on leave while SSS or employee’s compensation benefits - Employers should

grant the same percentage of the holiday pay as the benefit granted by competent
authority in the form of employee’s compensation or social security payment, whichever is
higher, if they are not reporting for work while on such benefits.

4. When day preceding regular holiday is a non-working day or schedule rest day - should
not be deemed to be on leave of absence on that day, in which case, employees are
entitled to the regular holiday pay if they worked on the day immediately preceding the non-
working day or rest day
 13TH MONTH PAY (P.D. 851)
COVERAGE: Only rank-and-file employees in the private sector, regardless of their position,
designation, or employment status and irrespective of the method by which their wages
are paid are entitled to 13th month pay, provided that they have worked for at least one
(1) month during the calendar year. Managerial employees are excluded.

Who are excluded from its coverage?

The following employers are not covered by the 13th month pay law:

1.The government and any of its political subdivisions, including government-owned and
controlled corporations, except those corporations operating essentially as private
subsidiaries of the government.

2. Employers already paying their employees 13th month pay or more in a calendar year or
its equivalent at the time of the issuance of the Revised Guidelines

3. Employers of those who are paid on purely commission, boundary, or task basis, and those
who are paid a fixed amount for performing a specific work, irrespective of the time
consumed in the performance thereof.
 13TH MONTH PAY (P.D. 851)
When should 13th month pay be paid?
It must be paid not later than December 24 of every year

What is the minimum amount of the 13th month pay?

The minimum 13th month pay should not be less that one-twelfth (1/12) of the total basic
salary earned by an employee within a calendar year.

What is meant by “basic salary” or “basic wage”?

“Basic Salary” or Basic Wage” contemplates work within the normal eight (8) working hours in
a day. This means that the basic salary of an employee for purposes of computing the 13th
month pay should include all remunerations or earnings paid by the employer for services
rendered during normal working hours.

For purposes of computing the 13th month pay, “basic salary” should be interpreted to mean
not the amount actually received by an employee, but 1/12 of their standard monthly wage
multiplied by their length of service within a given calendar year.
 LEAVES
A. Service Incentives Leave

Every covered employee who has rendered at least one (1) year of service is
entitled to a yearly service incentive leave of five (5) days with pay.

The service incentive leave is commutable to its money

equivalent if not used or exhausted at the end of the year.
SERVICE INCENTIVE LEAVE
All employees are covered by the rule on service incentive leave except:

1. government employees, whether employed by the National Government or any of

its political subdivisions, including those employed in government-owned and/or
controlled corporations with original charters or created under special laws;
2. Persons in the personal service of another;
3. Managerial employees, if they meet all of the following conditions:
3.1 Their primary duty is to manage the establishment in which they are employed or
of a department or subdivision thereof;
3.2. They customarily and regularly direct the work of two or more employees therein;
and
3.3. They have the authority to hire or fire other employees of lower rank; or their
suggestions and recommendations as to hiring, firing, and promoting, or any other
change of status of other employees are given particular weight.
 4. Officers or members of a managerial staff, if they perform the following duties and
responsibilities:
4.1. Primarily perform work directly related to management policies of their employer
4.2. Customarily and regularly exercise discretion and independent judgement;
4.3 (a) Regularly and directly assist a proprietor or managerial employee in the management
of the establishment or subdivision thereof in which he or she is employed; or (b) execute,
under general supervision, work along specialized or technical lines requiring special training,
experience, or knowledge; or (c) execute, under general supervision, special assignment and
task; and
4.4 Do not devote more than twenty percent (20%) of their hours worked in a workweek to
activities which are not directly and closely related to the performance of the work described
in paragraph 4.1, 4.2, and 4.3 above;

5. Field personnel and those whose time and performance are unsupervised by the employer,
including those who are engaged on task or contact basis, purely commission basis or those who
are paid a fixed amount for performing work irrespective of the time consumed in the
performance thereof;
6. Those already enjoying this benefit;
7. Those enjoying vacation leave with pay of at least five (5) days; and
8 Those employed in establishments regularly employing less than ten (10) employees
MATERNITY LEAVE (RA 11210)
Coverage:
All covered females, regardless of civil status, employment
status, and the legitimacy of her child, are entitled to maternity
leave.
PERIOD OF MATERNITY LEAVE
Paid leave benefit granted to a qualified female worker in both the PUBLIC
SECTOR and PRIVATE SECTOR (which is covered by the SSS, including those in
the informal economy), for the duration of:

105 days - in case of live childbirth, regardless of the mode of delivery

Plus additional 15 paid days of paid leave for female worker qualified as
solo parent
There is an option to extend for an additional thirty (30) days without pay
Available for every instance of live childbirth, regardless of frequency

60 days - for miscarriage and emergency termination of pregnancy

A female worker entitled to maternity leave benefits may, at her
option, allocate up to seven (7) days of said benefits to the
child’s father or alternate caregiver.
 PATERNITY LEAVE
“Paternity leave” covers a married male employee allowing him not to report for
work for seven (7) CALENDAR days but continues to earn the compensation
therefor, on the condition that his spouse has delivered a child or suffered
miscarriage for purposes of enabling him to effectively lend support to his wife in
her period of recovery and /or in the nursing of the newly-born child.

“Delivery” includes childbirth or any miscarriage.

“Spouse” refers to the lawful wife. For spouse, “lawful wife” refers to a woman
who is legally married to the male employee concerned.
“Cohabiting” refers to the obligation of the husband and wife to live together
PATERNITY LEAVE
Every married employee in the private and public sectors is entitled to a
paternity leave of seven (7) calendar days with full pay for the first four (4)
deliveries of the legitimate spouse with whom he is cohabiting.

Paternity leave benefits are granted to the qualified employee after the
delivery by his wife, without prejudice to an employer allowing an employee
to avail of the benefit before or during the delivery, provided that the total
number of days should not exceed seven (7) calendar days for each delivery.

Unavailed paternity leave is not convertible to cash

SOLO PARENT LEAVE (RA 8972)
This is the leave benefit granted to a male or female solo parent to enable
him/her to perform parental duties and responsibilities where his/her physical
presence is required.

How many days may be availed of as solo parent leave?

The solo parent leave shall not be more than seven (7) WORKING days every
year to a solo partner who has rendered service of at least one (1) year, to
enable him/her to perform parental duties and responsibilities where his/her
physical presence is required. This shall be non-cumulative.

It bears noting that this leave privilege is an additional leave benefit which is
separate and distinct from any other leave benefits provided under existing laws
or agreements.
WHO IS A SOLO PARENT?
(1) A woman who gives birth as a result of rape and other crimes against chastity even
without a final conviction of the offender: Provided, that the mother keeps and raises
the child;

(2) Parent left solo or alone with the responsibility of parenthood due to death of
spouse;

(3) Parent left solo or alone with the responsibility of parenthood while the spouse is
detained or is serving sentence for a criminal conviction for at least one (1) year;

(4) Parent left solo or alone with the responsibility of parenthood due to physical and
/or mental incapacity of spouse as certified by a public medical practitioner;

(5) Parent left solo or alone with the responsibility of parenthood due to legal
separation or de facto separation from spouse for at least one (1) year, as long as he
/she is entrusted with the custody of the children
(6) Parent left solo or alone with the responsibility of parenthood due to declaration of
nullity or annulment of marriage as declared by a court or by a church as long as
he/she is entrusted with the custody of the children;

(7) Parent left solo or alone with the responsibility of parenthood due to abandonment
of spouse for at least one (1) year;

(8) Unmarried mother/father who has preferred to keep and rear her/his child/children
instead of having others care for them or give them up to welfare institution;

(9) Any other person who solely provides parental care and support to a child or
children;

(10) Any family member who assumes the responsibility of head of family as a result of
the death, abandonment, disappearance or prolonged absence of the parents or
solo parent.
A change in the status or circumstance of the parent claiming
benefits under the law, such that he/she is no longer left alone
with the responsibility of parenthood, shall terminate his/her
eligibility for these benefits.

In the event that the parental leave is not availed of, said leave
shall not be convertible to cash unless specifically agreed upon
previously.
REFERENCES:
ATTY. MAE DIANE AZORES, CPA
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