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LABOR RELATIONS LAW
1. Post-employment Ban (non-
involvement provision)
2. Right to impose post-
employment prohibitions: The
employer, in the exercise of its
prerogti!e, my insist on n
greement "ith the employee for
certin prohi#itions to t$e e%ect
fter termintion of their employer&
employee reltionship.
3. I.e. Non-compete or non-
involvement clause; forfeiture-for-
compensation clause or
compensation-for-competition
clause; garden-leave clause;
condentiality and non-disclosure
clause; non-solicitation clause; non-
recruitment or anti-piracy clause;
inventions assignment clause
(intellectual property clause)
'. Non-compete or non-
involvement clause: Freedom
to contract: The employer n(
employee re free to stip)lte in n
employment contrct prohi#iting
the employee "ithin certin
perio( from n( fter the
termintion of his employment,
from* (1) strting similr
#)siness, profession or tr(e+ or
() "or$ing in n entity tht is
engge( in similr #)siness tht
might compete "ith the employer.
Purpose: to pre!ent the possi#ility
tht )pon n employees
termintion or resigntion, he
might strt #)siness or "or$ for
competitor "ith the f)ll competiti!e(!ntge of $no"ing n(
exploiting con-(entil n(
sensiti!e informtion, tr(e
secrets, mr$eting plns etc.,
"hich he c)ire( n( gine( from
his former employment. !ontracts
"hich prohibit an employee
#rom engaging in business in
competition "ith the employer
are not necessarily void #or
being in restraint o# trade. e.g.
/0o!ennt Not to 0ompete1 0N03
or /Non&In!ol!ement 4ro!ision1cl)se.
5. Unreasonable when
6. 7err88ini !s. 9sell & It "s
)nreson#le restrint of tr(e
th)s ginst p)#lic policy "hen
employee "s prohi#ite( from
engging in ny #)siness or
occ)ption in the 4hilippines for
perio( of 5 yers fter termintion
of employment. In(ee( this "s
limite( s to time n( spce, B:T
"s not limite( s to tr(e.
Employee is force( to le!e the
co)ntry to "or$ if employer shll
not gi!e his permission.
;. <rtini !. 9lisermn = It is !oi( for
)nreson#le restrint of tr(e,
since EE "s prohi#ite( from
engging in ny #)siness similr to
tht of his employer for perio( of
> yer, "hen in fct EEs "or$ is
!ery limite( to p)rchse n( export
only = the restrint "s too #ro(+
his employment "s limite( only to
one of its ERs m)ltifrio)s
cti!ities.
?. !imitation as to time" place" etc.*
@. /0onform#ly then "ith the
forementione( prono)ncements,
non&in!ol!ement cl)se is not
necessrily !oi( for #eing in
restrint of tr(e s long s therere reasonable limitations as to
time$ trade$ and place.1
>./The non&in!ol!ement cl)se is
!li( "hen not contrry to p)#lic
"elfre n( not greter thn is
necessry to %or( fir n(
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reson#le protection to
respon(ent.1
>>.
1. Reasonable !ausal
!onnection Rule
>.Reasonable !ausal !onnection
Rule: The r)le in cse of conCict of
D)ris(iction #et"een L#or n(
Reg)lr 0o)rt. :n(er this r)le, %F
there is reson#le c)sl
connection #et"een the clim
sserte( n( the employer&
employee reltions, &'N the cse
is "ithin the D)ris(iction of l#or
co)rts. In the #sence of s)ch
nex)s, it is the reg)lr co)rt tht
hs D)ris(iction.
>'.Po"er to determine R-
relationship: Not only the L#or
Ar#iters n( the NLR0, #)t lso the
OLE Secretry, OLE Regionl
irectors in the exercise of its
!isitoril F n( enforcement po"er
)n(er Art. >2? #3 of L03+ <e(&
Ar#iter+ Socil Sec)rity
0ommission+
#$.
>6. %urisdiction and venue of !abor
&rbiters" N!' and regular courts
>;.*B+R *RB%&R: Po"ers: (1)
(D)(ictory po"er to her n(
(eci(e cses o!er "hich they h!e
D)ris(iction+ () contempt po"er+
(,) po"er to con()ct oc)lr
inspection+ urisdiction: Art. 2>;*
Originl n( Excl)si!e, mening no
other oGcer n( tri#)nls cn t$ecogni8nce of, or her n( (eci(e,
ny of the cses therein
en)merte(. Exceptions: (1)
When + /ecretary or
President e0ercises his po"er
under *rt. , (g) of the L0 to
ss)me D)ris(iction o!er ntionl
interest cses+ () When NR!
e0ercise its po"er o#
compulsory arbitration o!er
similr ntionl interest cses tht
re certi-e( to it #y the OLE
Secretry+ (,) When cses rising
from the interpretation or
implementation o# !B* n( fromthe interprettion or enforcement
of company personnel policies
"hich m)st #e referre( to the
grievance machinery and voluntary
arbitration, s mt #e pro!i(e( in
si( greements+ (2) When
parties agree to s)#mit the cse
to !ol)ntry r#itrtion #efore
oluntary &rbitrator or panel of
oluntary &rbitrators "ho h!e
originl F excl)si!e D)ris(iction toher n( (eci(e cses m)t)lly
s)#mitte( to them #y the prties,
s )n(er Art. 26>, 262 of L03.
13. 4R%/%!&%+N
>@.A. 4NF*%R *B+R PR*!&%!
!*// :L43 = Art. 2';, 2'?, 2'@,
26>, 26 c3. H)ris(iction is )n(er
L.A. #)t limite( only to the ci!il
spect of :L4, the criminl spect
#eing lo(ge( to reg)lr co)rts.
2.B. %5* %/6%//* !*//
I3 = originl n( excl)si!e
D)ris(iction is )n(er L.A., ol)ntry
Ar#itrtors, OLE Secretry in
exercise of ss)mption of ntionl
interest3, NLR0 for ntionl
interest cses certi-e( to it for
comp)lsory r#itrtion #y OLE
Sec3.
2>.0. 6+N7 !*%6/ <03 = originl
n( excl)si!e D)ris(iction of L.A.n( clssi-e( into t"o* 3 money
clim regr(less of mo)nt, "ith
clim for reinsttement rising
from termintion cse+ #3 money
clim "ithJo)t clim for
reinsttement excee(ing the
mo)nt of 45, . per climnt.
If less, not see$ing reinsttement,
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"ith EE&ER reltionship = Reg.
irector of OLE, or his )thori8e(
representti!es Art. >2@3. 4nder
.*. = "hen rising from l" or
contrct other thn the 0BA.
4nder 8oluntary *rbitrators =
"hen rising from 0BA or compnypersonnel policies.
22.0.>. H:RISI0TION OER
!+N&/& !*// INOLIN9
OLE SE0S ISITORIAL F
EN7OR0E<ENT 4OWERS
%N/P!&%+N +F
/&*B%/'6N&/3 = :n(er the
Exception 0l)se in Art. >2? #3*
OLE Secretrys H)ris(iction "hen*
>3 ER&EE reltionship still exist+ 23
7in(ings in )estion "ere m(e inthe co)rse of inspection #y l#or
inspector+ 3 EE h!e not yet
initite( ny climJcomplint "ith
OLE R.. )n(er Art. >2@, or L.A.
)n(er Art. 22'. 9!P& in cses
"here ER contests the -n(ings of
OLEJ R inspection n( rises
iss)es s)pporte( #y (oc)mentry
proofs "hich "ere llege(ly not
consi(ere( ()ring the inspection. In
"hich cse, the D)ris(iction lies"ith the *B+R *RB%&R not to
the +R nymore.
2.
2'.. !*%6/ F+R *6*5/ 073
= excl)si!e D)ris(iction of L.A., s
"ell s clim for ttorneys fees in
l#or cses, s long s the ction
primrily in!ol!es n ER&EE
reltionship.
25.E. 5*%&7 +F/&R%;/+!;+4&/ N+&
*FF!&%N5 N*&%+N*
%N&R/& = :n(er the D)ris(iction
of L.A. employer, in cse of stri$e,
or )nion, in cse of loc$o)t, my
-le the proper petition "ith L.A.
n( re)est (eclrtion of the
illeglity thereof.
26. 7. /&R%;/+!;+4&/
*FF!&%N5 %N4/&R%/
%N%/PN/*B &+ &'
N*&%+N* %N&R/& =
D)ris(iction of OLE Secretry in
cse he ss)mes D)ris(iction, or
"ith the NLR0, in cse OLESecretry certi-es it thereto. 7or
NLR0, the NLR0 i!ision "hich
c)ires D)ris(iction o!er the
principl oGce of the compny
shll h!e the D)ris(iction, )nless
the certi-ction other"ise pro!i(es.
*+. ',-%U'/0,N&! N&0U'1 ,2
0'1 4 !,,U0
*5.#. 2iling of notice to stri6e or
loc6out
N78
*9.*. 2iling of complaint declaring the
illegality of the stri6e or loc6out
!.&. (&rt. *#+ (a) ($)" !) or
oluntary &rbitrator (&rt. *:*" !)
3.3. 2iling of an in<unction petition
N!' in cases of &rt. *:=" *#5 (e)"
! for purposes of securing a
temporary restraining order (0',)
and in<unction.
3#.=. &ssumption of <urisdiction by /,!1 ecretary under &rt. *:3 (g)
only in >national interest? cases.
,nce he ma6es assumption" he
shall decide all the issues of the
certication order" thus all pending
case in other tribunals shall be
submitted to him.
3*.$. &ssumption of <urisdiction by
@resident. Ae is not precluded from
eBercising the powers of his alter
ego" the /,!1 ecretary" under &rt.*:3 (g) in settling or terminating
the stri6eCloc6out.
33.:. ubmission of national interest
case to oluntary &rbitration.
Dhere parties opt to submit their
dispute to voluntary arbitration"
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despite pendency of the assumed
or certied national interest case.
'.
5. 9. !R%6%N* !*// *R%/%N5
FR+6 /&R%;/ +!;+4&/ =
Al"ys "ithin the D)ris(iction of
reg)lr co)rts.
6.K. 5%/*& <*5
%N!R*//%/&+R&%+N = %F
"ith 0BA or recogni8e( #rgining
)nion, &'N RA 6;2; !ests it )pon
ol)ntry Ar#itrtion A3 or pnel
of A to her n( (eci(e, fter the
grie!nce proce()re in 0BA file(
to settle the sme. %F )norgni8e(
est#lishment, &'N D)ris(iction is
"ith the LA fter N0<B file( to
correct the (istortion.
;.I. <*5 %/&+R&%+N 6*
/4B!& +F /&R%;+!;+4& =
is not proper gro)n( to #e
in!o$e( in s)pport of stri$e or
loc$o)t. S)ch "ge or(ers iss)e(
#y the Regionl Triprtite Wges
n( 4ro()cti!ity Bor( RTW4B3
"hich re llege( in the notice of
stri$eJloc$o)t sho)l( #e referre( to
L.A. if not settle( "ithin > (ys #y
the N0<B.
?.H. *NN46N& +F !+6PR+6%/
*5R6N&/ = D)ris(iction is "ith
the L.A. /0ompromise Agreements1
=Art. 22; ny compromise
settlement incl)(ing those
in!ol!ing l#or stn(r( l"s,
!ol)ntrily gree( )pon #y the
prties "ith the ssistnce of the
B)re) or the Regionl OGce of
OLE. NLR0 is excl)(e( from
ss)ming D)ris(iction except in
cses of prim fcie e!i(ence of
fr)(, misrepresenttion, or
coercion.
@.. 9!4&%+N +F !%/%+N/ +F
8.*. = D)ris(iction is "ith the sme
.A. )n(er Art. 262&A. 8U0 in the
#sence of the .A. "ho ren(ere(
the (ecision, the "rit of exec)tion
my #e iss)e( #y the L.A. in the
region "here the "inning prty
resi(es,
'.L. +F< !*// = %F money clims
.*. RA ?'23 = %F money
clims "ith 0BA #et"een foreign
ER n( #rgining )nion of EE
8.*. = %F (ministrti!e, rising
from !iol. of r)les F reg)ltions
relting to licensing, recr)itment,
employment gencies, ref)n( of
fees, !iol. of con(ition of license to
recr)it+ (isciplinry ction cses
P+*
'>.<. +&'R !*//: EE of 9O00
"itho)t originl chrters, Alien
prties, priestJministers on non&
ecclesisticl %irs, (omestic
"or$ersJ$sm#hy if clim
excee(s 5php, ER of
cooperti!es limite( to money
clims n( illegl (ismissl,
co)nter&clims of ER ginst EE
.*. = EE of 9O00 "ith originl
chrters 0i!il Ser!ice
0ommission.
2. !*%6/ N+& 4NR *
4R%/%!&%+N:
2,.3 0lims for (mges risingfrom #rech of non&compete cl)sen( other post&employmentprohi#itions+ !+4R&/
''. #30lims for pyment of csh(!nces, cr, pplince n( otherlons of employees+ !+4R&/
'5. c3ismissl of corporte oGcers n(
their monetry clims+ R&!. An intr&corporte (isp)te. <tling octrineM
2.(3Iss)es in!ol!ing s)spension of pyment of (e#ts reh#ilittionrecei!ership3+ R&!
2>.e30ses in!ol!ing entities imm)ne froms)it+ shall not prosper
'?. f3 0ses flling )n(er the (octrine of forum non conveniens+
'@. g3)si&(elict or tort cses+
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5. h3 0riminl n( ci!il li#ilitiesrising from !ioltions of certinpro!isions of the L#or 0o(e+
5>. i3 0onstit)tionlity of 0BA pro!isions.52. All the foregoing iss)es or cses re
(isc)sse( #elo" seriatim.
?,.M6*&%N5 +!&R%N - :n(er this(octrine, the follo"ing r)les sho)l(#e o#ser!e(*
>3 The (ismissl of regular employeesflls )n(er the D)ris(iction of L#orAr#iters+ "hile tht of corporateo@cers flls "ithin the D)ris(iction of the reg)lr co)rts.
23 The term Acorporate o@cers refersonly to those expressly mentione( inthe 0orportion 0o(e n( By&L"s+ llother oGcers not so mentione( thereinre (eeme( employees.
3 !orporate o@cers re electe( orppointe( #y the (irectors orstoc$hol(ers, n( those "ho re gi!entht chrcter either #y the 0orportion0o(e or #y the corportions #y&l"s.
'3 The 0orportion 0o(e speci-cllymentions only the follo"ing corporateo@cers, to "it* president, secretary n( treasurer n( s)ch other oGcerss my #e pro!i(e( for in the #y&l"s.
53 &he Board o# irectors can nolonger create corporate o@cesbecause the po"er o# the Board o#
irectors to create a corporateo@ce cannot be delegated.
Therefore, the term Acorporateo@cers sho)l( only refer to the #o!en( to no other. A (i%erentinterprettion cn esily le!e the "yopen for the Bor( of irectors tocirc)m!ent the constit)tionllyg)rntee( sec)rity of ten)re of theemployee #y the expe(ient incl)sion inthe By&L"s of n en#ling cl)se onthe cretion of D)st ny corporte oGcerposition.
63 istinction bet"een a corporateo@cer and an employee. & AnAo@ce is crete( #y the chrter of thecorportion n( the Acorporateo@cer is electe( #y the (irectors orstoc$hol(ers. On the other hn(, nAemployee occ)pies no oGce n(generlly is employe( not #y the ctionof the (irectors or stoc$hol(ers #)t #ythe mnging oGcer of the corportion
"ho lso (etermines the compenstionto #e pi( to s)ch employee.
;3 Bec)se of the 7atling (octrine, ther)lings in Tabang n( Nacpil $ re nolonger controlling #ec)se they re /toos"eeping n( (o not ccor( "ith
reson, D)stice, n( fir ply.1?3 &he status o# an employee asdirector and stocCholder does notautomatically convert his dismissalinto an intra-corporate dispute.
@3 &"o () elements to determine"hether a dispute is intra-corporate or not.
5'. 3 The stt)s or reltionship of the prties+ n(
55. #3 The nt)re of the )estiontht is the s)#Dect of theircontro!ersy. (Nature of controversy
test).56. In the #sence of ny one of these fctors, the RT0 "ill not h!e
D)ris(iction.>3 &he criteria do not depend on
the services per#ormed but on themanner o# creation o# the o@ce.5;. In 7atling" respon(ent 0orros"s s)ppose(ly t once n employee, stoc$hol(er, n( irector of <tling.
The circ)mstnces s)rro)n(ing hisppointment to oGce m)st #e f)llyconsi(ere( to (etermine "hether the(ismissl constit)te( n intr&corportecontro!ersy or l#or termintion(isp)te. It m)st lso #e consi(ere("hether his stt)s s irector n(stoc$hol(er h( ny reltion t ll to hisppointment n( s)#se)ent (ismissls ice 4resi(ent for 7innce n(A(ministrtion.5?. O#!io)sly eno)gh, therespon(ent "s not ppointe( s ice4resi(ent for 7innce n( A(ministrtion#ec)se of his #eing stoc$hol(er orirector of <tling. Ke h( strte("or$ing for <tling on Septem#er ?,>@66, n( h( #een employe(contin)o)sly for yers )ntil histermintion on April >;, 2. Kis -rst"or$ s #oo$$eeper n( his clim# in>@?; to his lst position s ice4resi(ent for 7innce n( A(ministrtionh( #een gr()l #)t ste(y. E!entho)gh he might h!e #ecome stoc$hol(er of <tling in >@@2, his
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promotion to the position of ice4resi(ent for 7innce n( A(ministrtionin >@?; "s #y !irt)e of the length of )lity ser!ice he h( ren(ere( s nemployee of <tling. Kis s)#se)entc)isition of the stt)s of
irectorJstoc$hol(er h( no reltion tohis promotion. Besi(es, his stt)s of irectorJstoc$hol(er "s )n%ecte( #yhis (ismissl from employment s ice4resi(ent for 7innce n(A(ministrtion.
5@. ,. /%5N%F%!*N& !*// !%B*/ +N &' MATLINGDOCTINE.
6. a. !osare v.Broadcom *sia$ %nc.
6>. In this 2>' cse, theS)preme 0o)rt r)le( tht the L#orAr#iter, not the reg)lr co)rts, hsoriginl D)ris(iction o!er the illegl(ismissl cse -le( #y petitioner0osre "ho "s n incorportor of respon(ent Bro(com n( "shol(ing the position of Assistnt ice4resi(ent for Sles A4 for Sles3n( Ke( of the Technicl0oor(intion t the time of histermintion. The follo"ing
D)sti-ctions "ere cite( in s)pport of this r)ling*62. >3 The mere fct tht
person "s stoc$hol(er n( noGcer of the compny t the timethe s)#Dect contro!ersy (e!elope((oes not necessrily m$e thecse n intr&corporte (isp)te.
6. 23 A person, ltho)gh noGcer of the compny, is notnecessrily corporte oGcerthereof.
6'. 3 9enerl InformtionSheet 9IS3 s)#mitte( to SE0neither go!erns nor est#lishesthe nt)re of oGce.
65. '3 The Nature of the ontroversy 0est * The mere fct tht person "s
stoc$hol(er t the time of the -ling
of the illegl (ismissl cse (oes not
m$e the ction n intr&corporte
(isp)te.
. Rule on 6arriage
6;. %N8*%%&7 +F /&%P4*&%+N
*5*%N/& 6*RR%*5 =Art. >6,
L0, consi(ers )nl"f)l stip)ltion
to re)ire s con(ition of
employment tht "omn EE shll
not get mrrie( or to stip)lte
expressly or tcitly tht )pongetting mrrie(, "omn EE shll
#e (eeme( resigne( or seprte(.
Also in!li( is to ct)lly (ismiss,
(ischrge, (iscriminte or preD)(ice
"omn EE merely #y reson of
her mrrige.
6?.Reasonable Business Necessity
Rule = in!li( for !iolting the
stn(r( of reson#leness "hich
is #eing follo"e( in o)r D)ris(iction.
E.g. stip)ltion of not llo"ing npplicnt relte( "ithin thir(
(egree of consng)inity to n
employee+ t"o employee to get
mrry. B4& 8*% %N !*//
<'R, the stip)ltion is, /You agree
to disclose to management any existing or future
relationship you may have, either by consanguinity or
affinity with co-employees or employees of competing
drug companies. Should it pose a possible conflict of
interest in management discretion, you agree to resign
voluntarily from the Company as a matter of Company
policy”
6@.Dialcita v. Philippine *irlines$ %nc.
& In this cse (eci(e( #y the OGce of
the 4resi(ent" the pro!ision in
contrct #et"een n irline compny
n( Cight tten(nt "hich sttes
tht /Cight tten(nt&pplicnts
m)st #e single n( tht they shll #e
)tomticlly seprte( from
employment in the e!ent they
s)#se)ently get mrrie(1 "s
(eclre( s n)ll n( !oi( pro!ision+
hence, cnnot #e enforce( for #eingcontrry to Article >6 of the L#or
0o(e n( the protection&to&l#or
cl)se in the 0onstit)tion. R)le on
(etermintion of ge n( #ene-ts
for retirement
;.
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+#.
a. 1Bception to the rule of
retirement +*.0ermination or illegal dismissal
(&rt. *99 in re of &rt. 39: of N)
+3.7oney claims before @/ *==*"eEect after eEectivity accruing
after activity a. @romisserial doctrine"
money claims prescribed in
3 yearsb. f due and payable but not
yet paid from the last
commitment or promise
begins the counting of
prescriptive periodc. &rt. *5 Bed term contract
(@N,-0 vs. N!')+=.1ntrust on the obligation that has
not been paid+$.@rinciple on disFualication of
union members who are appointive
or elective. 7oral turpitude as
ground for disFualication for
elective and appointive. n order to
be disFualied" there must be
conviction.+:.tri6e and loc6out G eEect of
assumption over the labor dispute
by the @resident or the /,!1
ecretary only valid if there isindustry struc6 or about to have
industry struc6" indispensable to
national economy.++./eance after the ,Hce of the
@resident or /,!1 ecretary
ordered the assumption" when it is
ground for termination of a union
member. (&rt. *:=" *+* 4 *55)+5.ancellation of unions registration"
voluntary dissolution (&rt. *39"
*=$" *5)+9.'ecruitment
a. 7igrant Dor6erIs &ct"
benets due to ,2D when
repatriated due to issues.
?.@regnancy as ground for
termination of employment" valid
or not.
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