Basic Labor Laws

Labor Code of the Philippines

Atty. Mark Julius Dosil, CPA

 State Policy
Labor Code

Art. 3. Declaration of basic policy. The State shall afford

protection to labor, promote full employment, ensure
equal work opportunities regardless of sex, race or creed
and regulate the relations between workers and
employers. The State shall assure the rights of workers to
self-organization, collective bargaining, security of tenure,
and just and humane conditions of work.
 Construction in Favor of Labor
Labor Code

Art. 4. Construction in favor of labor. All doubts in the

implementation and interpretation of the
provisions of this Code, including its
implementing rules and regulations, shall be
resolved in favor of labor.
Book Three: Conditions of
Employment
P.D. 442, Labor Code

Atty. Mark Julius Dosil, CPA

 Coverage
Hours of Work

ART. 82. Coverage. – The provisions of this Title shall apply to employees in all establishments
and undertakings whether for profit or not, but not to:
1. government employees;
2. managerial employees;
3. field personnel;
4. members of the family of the employer who are dependent on him for support;
5. domestic helpers;
6. persons in the personal service of another; and
7. workers who are paid by results as determined by the Secretary of Labor in appropriate
regulations.
 Hours of Work
Hours of Work

As used herein, “managerial employees” refer to those whose primary

duty consists of the management of the establishment in which they are
employed or of a department or subdivision thereof, and to other officers
or members of the managerial staff.
“Field personnel” shall refer to non-agricultural employees who
regularly perform their duties away from the principal place of business
or branch office of the employer and whose actual hours of work in the
field cannot be determined with reasonable certainty.
 Normal Hours of Work
Hours of Work

ART. 83. Normal Hours of Work. – The normal hours of work of any
employee shall not exceed eight (8) hours a day.
 Health Personnel
Hours of Work

Health personnel in cities and municipalities with a population of at least one

million (1,000,000) or in hospitals and clinics with a bed capacity of at least one
hundred (100) shall hold regular office hours for eight (8) hours a day, for five (5) days a
week, exclusive of time for meals, except where the exigencies of the service require that
such personnel work for six (6) days or forty-eight (48) hours, in which case, they
shall be entitled to an additional compensation of at least thirty percent (30%) of
their regular wage for work on the sixth day. For purposes of this Article, “health
personnel” shall include resident physicians, nurses, nutritionists, dieticians,
pharmacists, social workers, laboratory technicians, paramedical technicians,
psychologists, midwives, attendants and all other hospital or clinic personnel.
 Hours Worked
Hours of Work

ART. 84. Hours Worked. – Hours worked shall 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.
Rest periods of short duration during working hours shall be
counted as hours worked.
 Lunch Break
Hours of Work

ART. 85. Meal Periods. – Subject to such regulations as

the Secretary of Labor may prescribe, it shall be the
duty of every employer to give his employees not less
than sixty (60) minutes time-off for their regular
meals.
 Night Diff
Hours of Work

ART. 86. Night-Shift Differential. – Every employee shall be

paid a night shift differential of not less than ten percent
(10%) of his regular wage for each hour of work performed
between ten o’clock in the evening and six o’clock in the
morning.
 OT
Hours of Work

ART. 87. Overtime Work. – Work may be performed beyond eight (8)
hours a day provided that the employee is paid for the overtime
work, an additional compensation equivalent to his regular wage plus
at least twenty-five percent (25%) thereof. Work performed beyond
eight hours on a holiday or rest day shall be paid an additional
compensation equivalent to the rate of the first eight hours on a
holiday or rest day plus at least thirty percent (30%) thereof.
 UT not Offset by OT
Hours of Work

ART. 88. Undertime Not Offset by Overtime. – Undertime

work on any particular day shall not be offset by
overtime work on any other day. Permission given to the
employee to go on leave on some other day of the week
shall not exempt the employer from paying the
additional compensation required in this Chapter.
 Emergency OT
Hours of Work

ART. 89. Emergency Overtime Work. – Any employee may be required by the
employer to perform overtime work in any of the following cases: (WE I MIE P SO)
(a) 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;
(b) When it is necessary to prevent loss of life or property or in case of imminent
danger to public safety due to an actual or impending emergency in the locality
caused by serious accidents, fire, flood, typhoon, earthquake, epidemic, or
other disaster or calamity;
 Emergency OT
Hours of Work

(c) When there is urgent work to be performed on machines, installations, or

equipment, in order to avoid serious loss or damage to the employer or some other
cause of similar nature;
(d) When the work is necessary to prevent loss or damage to perishable goods; and
(e) Where the completion or continuation of the work started before the eighth hour is
necessary to prevent serious obstruction or prejudice to the business or
operations of the employer.
Any employee required to render overtime work under this Article shall be paid the
additional compensation required in this Chapter.
 Weekly Rest Day
Weekly Rest Periods

ART. 91. Right to Weekly Rest Day. –

(a) It shall be the duty of every employer, whether operating for profit or not,
to provide each of his employees a rest period of not less than twenty-four
(24) consecutive hours after every six (6) consecutive normal work days.
(b) The employer shall determine and schedule the weekly rest day of his
employees subject to collective bargaining agreement and to such rules and
regulations as the Secretary of Labor and Employment may provide.
However, the employer shall respect the preference of employees as to
their weekly rest day when such preference is based on religious grounds.
 Emergency Rest Day
Weekly Rest Periods

ART. 92. When Employer May Require Work on a Rest Day. – The employer may
require his employees to work on any day: (IMA
(a) In case of actual or impending emergencies caused by serious accident,
fire, flood, typhoon, earthquake, epidemic or other disaster or calamity to
prevent loss of life and property, or imminent danger to public safety;
(b) In cases of urgent work to be performed on the machinery, equipment, or
installation, to avoid serious loss which the employer would otherwise suffer;
 Emergency Rest Day
Weekly Rest Periods

(c) In the event of abnormal pressure of work due to special

circumstances, where the employer cannot ordinarily be expected to resort
to other measures;
(d) To prevent loss or damage to perishable goods;
(e) Where the nature of the work requires continuous operations and the
stoppage of work may result in irreparable injury or loss to the employer; and
(f ) Under other circumstances analogous or similar to the foregoing as
determined by the Secretary of Labor and Employment.
 Emergency Rest Day
Weekly Rest Periods

ART. 93. Compensation for Rest Day, Sunday or Holiday Work. –

(a) Where an employee is made or permitted to work on his scheduled rest day, he
shall be paid an additional compensation of at least thirty percent (30%) of
his regular wage. An employee shall be entitled to such additional compensation
for work performed on Sunday only when it is his established rest day.
(b) When the nature of the work of the employee is such that he has no regular
workdays and no regular rest days can be scheduled, he shall be paid an
additional compensation of at least thirty percent (30%) of his regular wage
for work performed on Sundays and holidays.
 Emergency Rest Day
Weekly Rest Periods

(c) Work performed on any special holiday shall be paid an additional

compensation of at least thirty percent (30%) of the regular wage of
the employee. Where such holiday work falls on the employee’s
scheduled rest day, he shall be entitled to an additional compensation
of at least fifty per cent (50%) of his regular wage.
(d) Where the collective bargaining agreement or other applicable
employment contract stipulates the payment of a higher premium pay
than that prescribed under this Article, the employer shall pay such
higher rate.
 Regular Holiday
Holidays, Service Incentive Leaves, and Service Charges

ART. 94. Right to Holiday Pay. –

(a) 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;
(b) The employer may require an employee to work on any holiday but such employee
shall be paid a compensation equivalent to twice his regular rate; and
(c) As used in this Article, “holiday” includes: New Year’s Day, Maundy Thursday,
Good Friday, the ninth of April, the first of May, the twelfth of June, the fourth of
July, the thirtieth of November, the twenty-fifth and thirtieth of December and the day
designated by law for holding a general election.
 Service Incentive Leave
Holidays, Service Incentive Leaves, and Service Charges

ART. 95. Right to Service Incentive Leave. –

(a) Every employee who has rendered at least one year of service shall be entitled to
a yearly service incentive leave of five days with pay.
(b) This provision shall not apply to those who are already enjoying the benefit herein
provided, those enjoying vacation leave with pay of at least five days and those
employed in establishments regularly employing less than ten employees or in
establishments exempted from granting this benefit by the Secretary of Labor and
Employment after considering the viability or financial condition of such
establishment.
 Service Charges
Holidays, Service Incentive Leaves, and Service Charges

All service charges collected by hotels, restaurants and similar

establishments shall be distributed completely and equally among the
covered workers except managerial employees.
In the event that the minimum wage is increased by law or wage order,
service charges paid to the covered employees shall not be considered in
determining the employer’s compliance with the increased minimum wage.
(As amended by RA 11360)
 13th Month May
PD 851

Section 1. All employers are hereby required to pay all their

employees receiving a basic salary of not more than P1,000 a
month, regardless of the nature of their employment, a 13th-
month pay not later than December 24 of every year.

Section 2. Definition of certain terms As used in this issuance.

(a) "Thirteenth-month pay" shall mean one twelfth (1/12) of the
basic salary of an employee within a calendar year;
 Others
Labor

If the employee did not work, the “no

work, no pay” principle shall apply, unless
there is a company policy, practice, or
collective bargaining agreement (CBA)
granting payment on a special day.
 Sample Problem
Night Shift, OT

Sample Problem:
A worked on Monday-Friday from 9pm-8am. His daily rate is P1,600.00. How much does he
earn daily?
Computation:
Basic Rate hourly: P1,600/day / 8hrs = P200/hr
Basic Salary: P200 x 8 hrs = 1,600.00
Overtime: P200 x 2 hrs x 125% (OT) = 500.00
Night Diff: P200 x 7 hrs (10pm-6am less LB) x 10% (NSD Premium)= 140.00
Total = P2,240.00
 Sample Problem
Rest Day

Sample Problem:
A worked on Saturday, his rest day, from 8am-7pm. His daily rate is P800.00. How
much did he earned for that day?
Computation:
Basic Rate hourly: P800/day / 8hrs = P100/hr
Basic Salary for Sat: P100 x 8 hrs x 130% (RD)= 1,040.00


Overtime for Sat: P100*2 hrs*130% (OT)= 260.00



Total = P1,300.00

 Sample Problem
Special Holiday

Sample Problem:
A worked on a Special Holiday, from 8am-7pm. His daily rate is P800.00. How much
did he earned for that day?
Computation:
Basic Rate hourly: P800/day / 8hrs = P100/hr
Basic Salary: P100 x 8 hrs x 130% (SH) = 1,040.00


Overtime: P100 x 2 hrs x 130% (OT) x 130% (SH) = 338.00



Total = P1,378.00
 Sample Problem
Rest Day plus Special Holiday

Sample Problem:
A worked on a Special Holiday and a Sunday, from 8am-7pm. His daily rate is P800.00.
How much did he earned for that day?
Computation:
Basic Rate hourly: P800/day / 8hrs = P100/hr
Basic Salary: P100 x 8 hrs x 150% (RD+SH) = 1,200.00


Overtime: P100 x 2 hrs x 130% (OT) x 150% (RD+SH)= 390.00



Total = P1,590.00
 Sample Problem
Rest Day plus Regular Holiday

Sample Problem:
A worked on a Regular Holiday and a Sunday, from 8am-7pm. His daily rate is P800.00.
How much did he earned for that day?
Computation:
Basic Rate hourly: P800/day / 8hrs = P100/hr
Basic Salary: P100 x 8 hrs x 130% (RD) x 200% (RH) = 2,080.00


Overtime: P100x 2 hrs x 130% (OT) x 130% (RD) x 200% (RH)= 676.00


Total = P2,756.00