Book Five – Labor

Relations, P.D.
442, Labor Code
 Title I – Policy and Definitions
Chapter I – Policy
Article 218 – Declaration of Policy
A. The policy of the State includes:
1. Primacy of Collective Bargaining:
o Emphasize the importance of free collective bargaining, including voluntary arbitration, mediation, and
conciliation, as the primary means for resolving labor disputes.
2. Promotion of Free Trade Unionism:
o Support free trade unionism as a tool for enhancing democracy, social justice, and development.
3. Strengthening Labor Movement:
o Foster the free and voluntary organization of a strong and unified labor movement.
4. Worker Education:
o Promote the education of workers about their rights and obligations as union members and employees.
5. Effective Dispute Resolution:
o Provide a robust administrative system for the swift resolution of labor disputes.
6. Balanced Industrial Peace:
o Ensure a stable, dynamic, and just industrial peace.
7. Worker Participation:
o Ensure workers’ involvement in decision-making processes affecting their rights, duties, and welfare.
B. Democratic Regulation of Labor Relations:
 Encourage regulation of employer-employee relations through agreements freely negotiated by the parties. Courts
and administrative bodies cannot unilaterally set wages, work hours, or other employment terms except as
provided in the Code.
 Chapter II – Definitions
Article 219 – Definitions
*Article 219 of Book Five of the Philippine Labor Code provides definitions for various terms used in labor relations.
 Commission - Refers to the National Labor Relations Commission (NLRC) or its divisions.
 Bureau - The Bureau of Labor Relations or Labor Relations Divisions in regional offices under the Department of
Labor.
 Board - The National Conciliation and Mediation Board established under Executive Order No. 126.
 Council - The Tripartite Voluntary Arbitration Advisory Council established under Executive Order No. 126, as
amended.
 Employer - Includes any person acting in the interest of an employer, directly or indirectly, but not labor organizations
or their officers unless acting as an employer.
 Employee - Any person in the employ of an employer, including those whose work has ceased due to a labor dispute or
unfair labor practice, if they have not found equivalent employment.
 Labor Organization - Any union or association of employees formed for collective bargaining or dealing with employers
regarding employment terms.
 Legitimate Labor Organization - A labor organization registered with the Department of Labor and Employment,
including its branches or locals.
 Company Union - A labor organization formed or supported by unfair labor practices as defined by the Code.
 Bargaining Representative - A legitimate labor organization or its officer or agent, regardless of employment status
with the employer.
 Unfair Labor Practice - Practices explicitly defined as unfair by the Code.
 Labor Dispute - Any issue concerning employment terms or the representation of persons in negotiating or maintaining
employment terms, regardless of the employer-employee relationship.
 Managerial Employee - An employee with authority to implement management policies or make decisions on hiring,
discipline, etc. Supervisory employees make recommendations for managerial actions but are not involved in daily
management tasks. All other employees are considered rank-and-file.
 Voluntary Arbitrator - An accredited individual or one designated by a Collective Bargaining Agreement to resolve
disputes, or an official authorized by the Secretary of Labor and Employment.
 Strike - A temporary work stoppage by employees due to an industrial or labor dispute.
 Lockout: A temporary refusal by an employer to provide work due to an industrial or labor dispute.
 Internal Union Dispute - Disputes or grievances arising from violations or disagreements over union rules, membership
rights, or conditions.
 Strike-Breaker - A person who interferes with peaceful picketing or obstructs the exercise of labor rights through force,
violence, or intimidation.
• Strike Area - The workplace and its immediate vicinity where picketing occurs during a strike, including access points
to the establishment
 Title II – National Labor Relations Commission
Chapter I – Creation and Composition
Article 220-National Labor Relations Commission

The National Labor Relations Commission (NLRC), under the Department of Labor and Employment, is composed of a
Chairman and 23 members, with 8 members from workers' organizations, 8 from employers' organizations, and the
remaining from the public sector. The Commission operates in eight divisions, each handling labor cases from various
regions of the Philippines, with exclusive appellate jurisdiction over cases in their respective areas.

The Chairman oversees the Commission's administration, aided by Executive Clerks, while Commission Attorneys assist
with adjudication. Members must be Philippine Bar members with at least 15 years of legal experience, and labor arbiters
require at least 10 years of experience. They serve until age 65, extendable to 70 by the President.

The Chairman and Commissioners' salaries match those of Court of Appeals justices, and labor arbiters receive
compensation equivalent to regional trial court judges. The President appoints all members, and vacancies are filled from
nominees of the same sector.
 Chapter II – Powers and Duties:

 ART. 224: Jurisdiction of the Labor Arbiters and the Commission

o Labor Arbiters have original and exclusive jurisdiction over:
1. Unfair labor practices
2. Termination disputes
3. Wage, working hours, and employment conditions cases (if claiming reinstatement)
4. Claims for damages from employer-employee relations
5. Violations of specific labor code articles, including legality of strikes
6. Other employer-employee relation claims over 5,000 pesos (excluding certain benefits)

o The Commission has exclusive appellate jurisdiction over Labor Arbiters' decisions.

 ART. 225: Powers of the Commission:

o Rule-making: Establish rules for case hearings and internal functions.
o Subpoena Authority: Administer oaths, issue subpoenas, and collect evidence.
o Investigation: Conduct investigations, hold hearings, correct errors, and dismiss trivial cases.
o Contempt Powers: Adjudge and penalize direct or indirect contempt; appeal process for direct contempt.
o Injunctions: Issue injunctions or restraining orders in labor disputes after a hearing, with conditions and an
undertaking to cover damages from wrongful issuance.
 Chapter III – Appeal

 ART. 229: Appeal Process:

o Decisions, awards, or orders of the Labor Arbiter are final unless appealed to the Commission within 10 days of
receipt.
o Appeals are allowed on grounds of:
1. Abuse of discretion by the Labor Arbiter.
2. Fraud, coercion, graft, or corruption.
3. Purely legal questions.
4. Serious factual errors causing significant harm.
o For monetary awards, employers must post a bond equivalent to the award amount to perfect the appeal.
o Reinstatement Orders: Reinstatement decisions are immediately executory, even if under appeal. The employer
must reinstate the employee or place them on the payroll.
o Penalties: The Commission or Labor Arbiter may impose penalties on parties making frivolous appeals.
o Process: Appellants must provide a copy of the appeal memorandum to the other party, who then has 10 days to
respond. The Commission will decide within 20 days of receiving the response. The Commission’s decision is final
10 days after receipt by the parties.
o Enforcement: Law enforcement agencies may be deputized to enforce decisions.
 Title III – Bureau of Labor Relations
 ART. 232: Bureau of Labor Relations:
o The Bureau and its regional divisions handle all inter-union and intra-union conflicts and labor-management
disputes in all workplaces, except those involving collective bargaining agreements, which are addressed through
grievance procedures or voluntary arbitration.
o The Bureau has 15 working days to act on cases, with possible extensions by mutual agreement.
 ART. 233: Compromise Agreements:
o Settlements agreed upon with the Bureau’s assistance are final and binding. The National Labor Relations
Commission or courts can only review these if there is non-compliance or evidence of fraud, misrepresentation, or
coercion.
 ART. 234: Mandatory Conciliation and Endorsement of Cases:
o All labor and employment disputes must go through mandatory conciliation-mediation unless exempted. Disputes
can be referred to the appropriate DOLE agency or voluntary arbitration if conciliation fails or if both parties
agree.
 ART. 235: Issuance of Subpoenas:
o The Bureau can issue subpoenas to require the appearance of individuals or the production of documents relevant
to labor disputes.
 Title IV – Labor Organizations
Chapter I – Registration and Cancellation

 ART. 240: Requirements of Registration

o Federations, national unions, or trade unions must meet the following for registration:
 P50 registration fee.
 Submit details of officers, addresses, meeting minutes, and worker participation.
 Independent unions must show membership of at least 20% of employees in the bargaining unit.
 Provide annual financial reports if in existence for over a year.
 Submit constitution and by-laws with adoption minutes and member list.
 ART. 245: Cancellation of Registration
o Registration may be canceled by the Bureau after a hearing, based on grounds specified in Article 247.

Chapter II – Rights and Conditions of Membership

ART. 250: Rights and Conditions of Membership in a Labor Organization

 Fees and Fines:

o No arbitrary or excessive initiation fees, fines, or forfeitures.
 Financial Transparency:
o Members must receive detailed financial reports.
o Payments must be documented with receipts, and funds can only be used as per the organization’s constitution and by-laws.
 Election of Officers:
o Members must elect officers by secret ballot every five years.
o Only membership in good standing is required for candidacy.
o Newly elected officers must be reported to the Secretary of Labor within 30 days.
 Policy Decisions:
o Major policy decisions must be made by secret ballot unless impractical, in which case the board can decide.
 Membership Restrictions:
o No admission or continuation of members involved in subversive activities.
o Individuals convicted of moral turpitude cannot hold union office.
 Authority and Accountability:
o Only authorized persons may collect or disburse funds.
o Financial transactions must be recorded, and accounts must be audited and reported at least annually.
 Compensation:
o Officers can only receive compensation specified in the constitution or authorized by majority vote.
o Irregularities in compensation approval can lead to impeachment or expulsion.
 Inspection and Reporting:
o Books and financial records must be open for inspection by members.
o Treasurers must provide annual accounts and upon office vacancy.
 Special Assessments:
o Special assessments or extraordinary fees require a majority vote and must be recorded.
 Employee Deductions:
o No special assessments without individual written authorization specifying amount, purpose, and beneficiary.
 Education and Information:
o Organizations must inform members about their rights, obligations, and labor laws. Reasonable dues can be assessed for
educational activities.
 Enforcement:
o Violations can lead to cancellation of union registration or officer expulsion. The Bureau can investigate and impose penalties,
while criminal and civil liabilities remain under ordinary courts' jurisdiction.
 Chapter III – Rights of Legitimate Labor Organizations
ART. 251: Rights of Legitimate Labor Organizations
 Collective Bargaining:
o Act as representatives for collective bargaining.
o Be certified as the exclusive bargaining representative for employees in a bargaining unit.
 Access to Employer Information:
o Request and receive annual audited financial statements from the employer within specified timeframes (30 days
after request, 60 days before a CBA expires, or during negotiations).
 Property and Legal Standing:
o Own property for the benefit of the organization and its members.
o Sue and be sued in its registered name.
 Additional Activities:
o Undertake projects such as cooperatives, housing, welfare, etc., as long as they are lawful.
 Tax Exemptions:
o Income, properties, and contributions used for lawful purposes are tax-exempt. Exemptions can only be revoked by
special law.
 Title V – Coverage
ART. 253: Coverage and Employees’ Right to Self-Organization
 Scope:
o Includes all persons employed in commercial, industrial, agricultural enterprises, and institutions (religious, charitable, medical,
or educational), regardless of profit orientation.
o Ambulant, intermittent, itinerant workers, self-employed individuals, rural workers, and those without fixed employers can also
form labor organizations for mutual aid and protection.
ART. 254: Right of Employees in the Public Service
 Government Corporations:
o Employees in government corporations established under the Corporation Code can organize and bargain collectively.
 Civil Service Employees:
o Can form associations for lawful purposes but not for collective bargaining.

Title VI – Unfair Labor Practices

Chapter I – Concept
ART. 258: Concept of Unfair Labor Practice and Procedure for Prosecution Thereof
 Definition:
o Unfair labor practices undermine workers' constitutional rights to self-organization, harm legitimate labor-management interests, disrupt
industrial peace, and obstruct healthy labor-management relations. These practices are deemed both civil rights violations and criminal offenses.
 Jurisdiction:
o Civil Aspects: Labor Arbiters handle civil aspects of unfair labor practices, including claims for damages and attorney’s fees. They must prioritize
and resolve these cases within 30 days from submission. Recovery of civil liabilities in administrative proceedings precludes recovery under the
Civil Code.
o Criminal Aspects: Criminal prosecution requires a final judgment from administrative proceedings confirming an unfair labor practice. During this
administrative process, the prescription period for criminal offenses is paused. However, the final judgment in administrative proceedings does not
serve as proof of guilt in criminal cases but demonstrates compliance with procedural requirements.
 Chapter II – Unfair Labor Practices of Employers

ART. 259: Unfair Labor Practices of Employers

It is unlawful for an employer to:
1. Interfere with Employee Rights: Restrict or coerce employees in exercising their right to self-organization.
2. Employment Conditions: Require employees to not join or withdraw from a labor organization as a condition of
employment.
3. Contracting Out Services: Outsource services performed by union members if it interferes with employees' rights to
self-organization.
4. Dominate Labor Organizations: Initiate, dominate, or interfere with the formation or administration of any labor
organization, including providing financial support.
5. Discriminate Based on Union Membership: Discriminate in wages, hours, or employment conditions to influence union
membership. However, a collective bargaining agreement may require membership as a condition of employment. Non-
union employees benefiting from the agreement may be assessed a fee equivalent to union dues without needing
individual authorization.
6. Retaliate Against Testimony: Dismiss or discriminate against employees for giving or preparing to give testimony under
this Code.
7. Fail to Bargain Collectively: Violate the duty to bargain collectively as required by the Code.
8. Pay Union Fees: Pay negotiation or attorney's fees to the union or its representatives as part of a collective bargaining
settlement.
9. Breach Agreements: Violate a collective bargaining agreement.
 Chapter III – Unfair Labor Practices of Labor Organizations

ART. 260: Unfair Labor Practices of Labor Organizations

A labor organization, its officers, agents, or representatives commit an unfair labor practice if they:
1. Restrict Employee Rights: Coerce or restrain employees in their right to self-organization. However, a
labor organization can set its own membership rules.
2. Cause Employer Discrimination: Attempt to make an employer discriminate against an employee,
including in cases where membership has been denied or terminated.
3. Fail to Bargain Collectively: Refuse to bargain collectively with the employer if the organization is the
employees' representative.
4. Demand Unwarranted Payments: Cause or attempt to cause an employer to pay for services not performed
or to be performed, including demanding fees for union negotiations.
5. Accept Unauthorized Fees: Ask for or accept negotiation or attorney’s fees from employers as part of a
collective bargaining settlement.
6. Breach Agreements: Violate a collective bargaining agreement.
 Title VII – Collective Bargaining and Administration of Agreements
ART. 261: Procedure in Collective Bargaining
1. Initiation: To start bargaining, a party must notify the other with its proposals. The recipient must reply within 10 days.
2. Conference Request: If disputes arise, a conference must be requested and held within 10 days.
3. Conciliation: If unresolved, the Board will intervene and call for conciliation meetings, with parties required to attend
and cooperate.
4. Dispute Conduct: During conciliation, parties must avoid actions that disrupt the process.
5. Settlement: The Board aims to settle disputes amicably and may suggest voluntary arbitration.
ART. 262: Duty to Bargain Collectively In the absence of other agreements, employers and employee representatives must
bargain collectively as per the Code's provisions.
ART. 263: Meaning of Duty to Bargain Collectively This duty involves meeting promptly and in good faith to negotiate
terms, including adjustments for grievances. It does not compel any party to agree or concede.
ART. 264: Duty to Bargain Collectively with Existing Agreements Parties must not terminate or modify an agreement
during its term. They can only do so with a 60-day notice before expiration, maintaining current terms until a new
agreement is reached.
ART. 265: Terms of a Collective Bargaining Agreement
 Term: Agreements are valid for 5 years. Majority status challenges are only entertained within the 60 days before
expiration.
 Renegotiation: Other provisions must be renegotiated within 3 years. Agreements made within 6 months post-
expiration are retroactive.
 Title VII-A – Grievance Machinery and Voluntary Arbitration
ART. 273: Grievance Machinery and Voluntary Arbitration
 Grievance Resolution: Collective Bargaining Agreements (CBAs) must include provisions for resolving grievances
arising from the CBA or company policies.
 Automatic Referral: Unresolved grievances within 7 days are referred to voluntary arbitration.
 Arbitrator Designation: Parties must designate a Voluntary Arbitrator or panel in advance. If they fail to do so, the
Board will appoint one.
ART. 274: Jurisdiction of Voluntary Arbitrators
 Exclusive Jurisdiction: Voluntary Arbitrators handle unresolved grievances from CBAs and company policies. Gross
violations of CBAs are treated as grievances, not unfair labor practices.
 Referrals: Labor and Employment officials cannot handle disputes under the arbitrators' jurisdiction and must refer
them to the grievance machinery or voluntary arbitration.
ART. 275: Jurisdiction over Other Labor Disputes
 Extended Jurisdiction: With party agreement, Voluntary Arbitrators can also address other labor disputes, including
unfair labor practices and bargaining deadlocks.
ART. 276: Procedures
 Arbitration Powers: Arbitrators can hold hearings, gather evidence, and facilitate voluntary settlements. They must
render a decision within 20 days unless parties agree otherwise.
 Final Decision: The decision is final and executory after 10 days. Execution of the award can be enforced by the Labor
Arbiter or designated public official.
ART. 277: Cost of Voluntary Arbitration
 Cost Sharing: CBAs must outline how the costs of arbitration, including the arbitrator’s fee, will be shared. Factors for
determining fees include the case's nature, hearing duration, arbitrator's professional standing, parties' ability to pay,
and applicable rules.
 Title VIII – Strikes and Lockouts
Chapter I – Strikes and Lockouts
ART. 278: Strikes, Picketing, and Lockouts
 Rights: Workers have the right to strike and picket, and employers can lock out, as long as these actions are not based on inter-union
or intra-union disputes.
 Notice Requirements:
o For bargaining deadlocks: 30 days' notice is required.
o For unfair labor practices: 15 days' notice is required. Immediate action is allowed if union officers are dismissed.
 Cooling-off Period: During this period, the Ministry will mediate to seek a resolution. If unresolved, strikes or lockouts can proceed.
 Approval and Supervision:
o Strikes must be approved by a majority of the union membership via secret ballot.
o Lockouts must be approved by a majority of the board of directors or partners.
o The Ministry may supervise the voting process.
 Secretary of Labor and Employment: Can assume jurisdiction or certify disputes for compulsory arbitration, especially in industries
crucial to national interest or in cases affecting health services. Strikes or lockouts must cease immediately upon such action.
 Compulsory Arbitration: Parties may opt for voluntary arbitration before or during compulsory arbitration. Decisions are final and
executory within 10 days of receipt.
Chapter II – Assistance to Labor Organizations
ART. 282: Assistance by the Department of Labor
 The Department of Labor, led by the Secretary of Labor, provides special assistance to underprivileged workers who are not typically
covered by major labor organizations. This support is aimed at facilitating their organization for collective bargaining.

ART. 283: Assistance by the Institute of Labor and Manpower Studies

 The Institute of Labor and Manpower Studies offers technical and educational support to both labor and employer organizations. This
includes guidance on collective bargaining, arbitration, labor standards, and the Labor Code of the Philippines.
 Chapter III – Foreign Activities
ART. 284: Prohibition Against Aliens; Exceptions
 Aliens and foreign organizations are generally prohibited from participating in trade union activities in the Philippines.
However, aliens with valid work permits can join or assist labor organizations if their home country grants similar
rights to Filipino workers.
ART. 285: Regulations of Foreign Assistance
 Foreign individuals, organizations, or entities cannot provide donations, grants, or other forms of assistance to labor
organizations or related groups without prior permission from the Secretary of Labor. This applies to activities related
to trade union operations, collective bargaining, and other related actions.
 The Secretary of Labor will set rules for regulating such foreign assistance, including reporting requirements.

Chapter IV – Penalties for Violation

ART. 287: Penalties
 For Violations of Article 264: Individuals found guilty may face a fine of ₱1,000 to ₱10,000 and/or imprisonment for 3
months to 3 years, or both, at the court's discretion. Prosecution under this provision is separate from prosecution
under the Revised Penal Code.
 For Foreign Violators: Foreigners violating these provisions may face immediate deportation and a permanent ban
from re-entering the country, as recommended by the Minister of Labor and Employment and the Minister of National
Defense.
 Title IX – Special Provisions
ART. 288: Study of Labor-Management Relations
 The Secretary of Labor is tasked with examining various aspects of employer-employee relations, including:
o The state of these relationships in the Philippines.
o The impact of employee associations.
o The effectiveness of collective bargaining.
o Methods for improving labor-management relations.
o Industrial practices developed through collective bargaining.
o Ways to enhance collective bargaining.
o Methods of labor-management cooperation.
o Causes of industrial unrest and recommending legislative remedies.
ART. 290: Tripartism, Tripartite Conferences, and Industrial Peace Councils
 Tripartism is a state policy, with workers and employers represented in government decision-making.
 The Secretary of Labor can call tripartite conferences with government, worker, and employer representatives to promote industrial
peace and align labor relations with national priorities.
 National Tripartite Industrial Peace Council (NTIPC) will be established with representatives from labor and employer sectors to:
o Monitor compliance with tripartite instruments.
o Participate in tripartite conferences.
o Review policies and developments.
o Formulate recommendations for labor, economic, and social concerns.
o Advise the Secretary of Labor and Employment.
o Facilitate communication and joint programs.
ART. 292: Miscellaneous Provisions
 Union Finances: Unions may collect fees for various purposes including education, mutual benefits, and strike funds.
 Termination: Employers must provide written notice and an opportunity to be heard before termination, with the
burden of proof on the employer. The Secretary of Labor may suspend termination effects if it might cause a serious
dispute or is part of a mass lay-off.
 Employee Membership: Employees are considered members of labor unions from their first day of service.
 Docket Fees: No fees for labor standards disputes; other disputes may incur fees, shared in bargaining deadlocks.
 Voluntary Arbitration Fund: A fund to support voluntary arbitration and related activities, with an initial amount of
₱15 million provided.
 Labor-Management Cooperation: Programs to promote cooperation and improve productivity and working conditions
will be supported.
 Labor-Management Committees: Where no union exists, committees may be formed to promote peace and education.
 Speedy Labor Justice: Decisions in labor cases must be rendered within mandated periods. Delays must be justified,
and cases must be resolved without further delay.