What should determine an employee-complainant’s cause or causes of action?

In the case below, the Petitioner, Samar-Med, asserts that it was a mistake for CA to reverse the finding of NLRC that Gutang was dismissed for a cause. It raises, as an issue, among others, that Gutang in his complaint did not include illegal dismissal as among his causes of action.

The Court held:

“Firstly, petitioner’s contention that the validity of Gutang’s dismissal should not be determined because it had not been included in his complaint before the NLRC is bereft of merit. The complaint of Gutang was a mere checklist of possible causes of action that he might have against Roleda. Such manner of preparing the complaint was obviously designed to facilitate the filing of complaints by employees and laborers who are thereby enabled to expediently set forth their grievances in a general manner.¹² But the non-inclusion in the complaint of the issue on the dismissal did not necessarily mean that the validity of the dismissal could not be an issue. The rules of the NLRC require the submission of verified position papers by the parties should they fail to agree upon an amicable settlement, and bar the inclusion of any cause of action not mentioned in the complaint or position paper from the time of their submission by the parties. In view of this, Gutang’s cause of action should be ascertained not from a reading of his complaint alone but also from a consideration and evaluation of both his complaint and position¹³ paper.” (italics added)

Samar-Med Distribution vs. National Labor Relations Commission, et al., G.R. No. 162385 July 15, 2013

Read the full text of the case here.

Is a bank deposit coupled with a deed of assignment executed by an appellant-employer in favor of the employee substantial compliance with the requirement of appeal bond?

“The posting of a bond is indispensable to the perfection of an appeal in cases involving monetary awards from the decision of the LA. The intention of the lawmakers to make the bond a mandatory requisite for the perfection of an appeal by the employer is clearly limned in the provision that an appeal by the employer may be perfected "only upon the posting of a cash or surety bond." The word "only" makes it perfectly plain that the lawmakers intended the posting of a cash or surety bond by the employer to be the essential and exclusive means by which an employer's appeal may be perfected. The Labor Code requires an employer who wishes to appeal from the decision, which includes a monetary award, of a labor arbiter to post cash or surety bond, in order to perfect the appeal.” xxx

In the case discussed below, the Petitioner (employer), in complying with the requirement of the appeal it filed assailing the decision of the Labor Arbiter, made a deposit for the amount of the award with its bank, and surrendered to the NLRC the passbook representing the deposit and a deed of assignment in favour of the employee.

The question that the employee took to the Court is whether the said deposit secured in a passbook account along with a deed of assignment constitute substantial compliance with the requirement of the law, thus employer has perfected its appeal. Otherwise, the decision appealed from would have become final and executory, because not having complied with the statutory jurisdictional requirement in perfecting an appeal, the Commission had not acquired jurisdiction, and the period within which to perfect an appeal did not stop by the filing of the defective appeal.

The Court held:

The petition is bereft of merit.

Article 223¹¹ of the Labor Code provides that an appeal by the employer to the NLRC from a judgment of a labor arbiter which involves a monetary award may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the NLRC, in an amount equivalent to the monetary award in the judgment appealed from. Section 4 of the New Rules of Procedure of the NLRC echoes the provision, viz.:

SECTION 4. REQUISITES FOR PERFECTION OF APPEAL. a) The appeal shall be filed within the reglementary period as provided in Section 1 of this Rule; shall be verified by appellant himself in accordance with Section 4, Rule 7 of the Rules of Court, with proof of payment of the required appeal fee and the posting of a cash or surety bond as provided in Section 6 of this Rule; shall be accompanied by memorandum of appeal in three (3) legibly typewritten copies which shall state the grounds relied upon and the arguments in support thereof; the relief prayed for, and a statement of the date when the appellant received the appealed decision, resolution or order and a certificate of non-forum shopping with proof of service on the other party of such appeal. A mere notice of appeal without complying with the other requisites aforestated shall not stop the running of the period for perfecting an appeal.

b) The appellee may file with the Regional Arbitration Branch or Regional Office where the appeal was filed, his answer or reply to appellant’s memorandum of appeal, not later than ten (10) calendar days from receipt thereof. Failure on the part of the appellee who was properly furnished with a copy of the appeal to file his answer or reply within the said period may be construed as a waiver on his part to file the same.

c) Subject to the provisions of Article 218, once the appeal is perfected in accordance with these Rules, the Commission shall limit itself to reviewing and deciding specific issues that were elevated on appeal. (emphasis supplied)

Further, Sec. 6 of the same Rules provides:

SECTION 6. BOND. In case the decision of the Labor Arbiter or the Regional Director involves a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond. The appeal bond shall either be in cash or surety in an amount equivalent to the monetary award, exclusive of damages and attorney’s fees.

In case of surety bond, the same shall be issued by a reputable bonding company duly accredited by the Commission or the Supreme Court, and shall be accompanied by:

a) a joint declaration under oath by the employer, his counsel, and the bonding company, attesting that the bond posted is genuine, and shall be in effect until final disposition of the case.

b) a copy of the indemnity agreement between the employer-appellant and bonding company; and

c) a copy of security deposit or collateral securing the bond.

A certified true copy of the bond shall be furnished by the appellant to the appellee who shall verify the regularity and genuineness thereof and immediately report to the Commission any irregularity.

Upon verification by the Commission that the bond is irregular or not genuine, the Commission shall cause the immediate dismissal of the appeal.

No motion to reduce bond shall be entertained except on meritorious grounds and upon the posting of a bond in a reasonable amount in relation to the monetary award.

The filing of the motion to reduce bond without compliance with the requisites in the preceding paragraph shall not stop the running of the period to perfect an appeal. (emphasis and underscoring supplied)

Clearly, an appeal from a judgment as that involved in the present case is perfected "only" upon the posting of a cash or surety bond. Accessories Specialist, Inc. v. Alabanza enlightens:¹²

The posting of a bond is indispensable to the perfection of an appeal in cases involving monetary awards from the decision of the LA. The intention of the lawmakers to make the bond a mandatory requisite for the perfection of an appeal by the employer is clearly limned in the provision that an appeal by the employer may be perfected "only upon the posting of a cash or surety bond." The word "only" makes it perfectly plain that the lawmakers intended the posting of a cash or surety bond by the employer to be the essential and exclusive means by which an employer's appeal may be perfected. The word "may" refers to the perfection of an appeal as optional on the part of the defeated party, but not to the compulsory posting of an appeal bond, if he desires to appeal. The meaning and the intention of the legislature in enacting a statute must be determined from the language employed; and where there is no ambiguity in the words used, then there is no room for construction.1avvphi1

The filing of the bond is not only mandatory but also a jurisdictional requirement that must be complied with in order to confer jurisdiction upon the NLRC. Non-compliance therewith renders the decision of the LA final and executory. This requirement is intended to assure the workers that if they prevail in the case, they will receive the money judgment in their favor upon the dismissal of the employer's appeal. It is intended to discourage employers from using an appeal to delay or evade their obligation to satisfy their employees' just and lawful claims. (citations omitted, italics in the original; emphasis and underscoring supplied)

"Cash," means a sum of money; cash bail (the sense in which the term "cash bond" is used) is a sum of money posted by a criminal defendant to ensure his presence in court, used in place of a surety bond and real estate.¹³

In the present case, the Deed of Assignment, as well as the passbook, which petitioner submitted to the NLRC is neither a cash nor a surety bond. Petitioner’s appeal to the NLRC was thus not duly perfected, thereby rendering the Labor Arbiter’s Decision final and executory.

WHEREFORE, the petition is DENIED.

SO ORDERED.

Mindanao Times Corporation vs. Mitchel R. Confesor, G.R. No. 183417 February 5, 2010

Read the full text of the case here.

Department Order No. 18-A Series of 2011: Rules on Contracting and Subcontracting Arrangements

Department Order No. 18-A
Series of 2011

RULES IMPLEMENTING ARTICLES 106 TO 109 OF THE LABOR CODE, AS AMENDED

By virtue of the power vested in the Secretary of Labor and Employment under Articles 5 and 106 to 109 of the Labor Code of the Philippines, as amended, the following regulations governing contracting and subcontracting arrangements are hereby issued:

Section 1. Guiding principles. Contracting and subcontracting arrangements are expressly allowed by law and are subject to regulations for the promotion of employment and the observance of the rights of workers to just and humane conditions of work, security of tenure, self-organization and collective bargaining. Labor-only contracting as defined herein shall be prohibited.

Section 2. Coverage. These Rules shall apply to all parties of contracting and subcontracting arrangements where employer-employee relationships exist. It shall also apply to cooperatives engaging in contracting or subcontracting arrangements.

Contractors and subcontractors referred to in these Rules are prohibited from engaging in recruitment and placement activities as defined in Article 13(b) of the Labor Code, whether for local or overseas employment.

Section 3. Definition of terms. The following terms as used in these Rules, shall mean:

(a) “Bond/s” refers to the bond under Article 108 of the Labor Code that the principal may require from the contractor to be posted equal to the cost of labor under contract. The same may also refer to the security or guarantee posted by the principal for the payment of the services of the contractors under the Service Agreement.

(b) “Cabo” refers to a person or group of persons or to a labor group which, in the guise of a labor organization, cooperative or any entity, supplies workers to an employer, with or without any monetary or other consideration, whether in the capacity of an agent of the employer or as an ostensible independent contractor.

(c) “Contracting” or “Subcontracting” refers to an arrangement whereby a principal agrees to put out or farm out with a contractor the performance or completion of a specific job, work or service within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal.

(d) “Contractor” refers to any person or entity, including a cooperative, engaged in a legitimate contracting or subcontracting arrangement providing either services, skilled workers, temporary workers, or a combination of services to a principal under a Service Agreement.

(e) “Contractor’s employee” includes one employed by a contractor to perform or complete a job, work, or service pursuant to a Service Agreement with a principal. It shall also refer to regular employees of the contractor whose functions are not dependent on the performance or completion of a specific job, work or service within a definite period of time, i.e., administrative staff.

(f) “In-house agency” refers to a contractor which is owned, managed, or controlled directly or indirectly by the principal or one where the principal owns/represents any share of stock, and which operates solely or mainly for the principal.

(g) “Net Financial Contracting Capacity (NFCC)1” refers to the formula to determine the financial capacity of the contractor to carry out the job, work or services sought to be undertaken under a Service Agreement. NFCC is current assets minus current liabilities multiplied by K, which stands for contract duration equivalent to: 10 for one year or less; 15 for more than one (1) year up to two (2) years; and 20 for more than two (2) years, minus the value of all outstanding or ongoing projects including contracts to be started.

1 Refers to the formula set out in the Implementing Rules and Regulations of Republic Act No. 9184, or An Act Providing for the Modernization, Standardization and Regulation of the Procurement Activities of the Government and For Other Purposes.

(h) “Principal” refers to any employer, whether a person or entity, including government agencies and government-owned and controlled-corporations, who/which puts out or farms out a job, service or work to a contractor.

(i) “Right to control” refers to the right reserved to the person for whom the services of the contractual workers are performed, to determine not only the end to be achieved, but also the manner and means to be used in reaching that end.

(j) “Service Agreement” refers to the contract between the principal and contractor containing the terms and conditions governing the performance or completion of a specific job, work or service being farmed out for a definite or predetermined period.

(k) “Solidary liability” refers to the liability of the principal, pursuant to the provision of Article 109 of the Labor Code, as direct employer together with the contractor for any violation of any provision of the Labor Code.

It also refers to the liability of the principal, in the same manner and extent that he/she is liable to his/her direct employees, to the extent of the work performed under the contract when the contractor fails to pay the wages of his/her employees, as provided in Article 106 of the Labor Code, as amended.

(l) "Substantial capital” refers to paid-up capital stocks/shares of at least Three Million Pesos (P3,000,000.00) in the case of corporations, partnerships and cooperatives; in the case of single proprietorship, a net worth of at least Three Million Pesos (P3,000,000.00).

(m) “Trilateral Relationship” refers to the relationship in a contracting or subcontracting arrangement where there is a contract for a specific job, work or service between the principal and the contractor, and a contract of employment between the contractor and its workers. There are three (3) parties involved in these arrangements: the principal who decides to farm out a job, work or service to a contractor; the contractor who has the capacity to independently undertake the performance of the job, work or service; and the contractual workers engaged by the contractor to accomplish the job, work or service.

Section 4. Legitimate contracting or subcontracting. Contracting or subcontracting shall be legitimate if all the following circumstances concur:

(a) The contractor must be registered in accordance with these Rules and carries a distinct and independent business and undertakes to perform the job, work or service on its own responsibility, according to its own manner and method, and free from control and direction of the principal in all matters connected with the performance of the work except as to the results thereof;

(b) The contractor has substantial capital and/or investment; and

(c) The Service Agreement ensures compliance with all the rights and benefits under Labor Laws.

Section 5. Trilateral relationship in contracting arrangements; Solidary liability. In legitimate contracting or subcontracting arrangement there exists:

(a) An employer-employee relationship between the contractor and the employees it engaged to perform the specific job, work or service being contracted; and

(b) A contractual relationship between the principal and the contractor as governed by the provisions of the Civil Code.

In the event of any violation of any provision of the Labor Code, including the failure to pay wages, there exists a solidary liability on the part of the principal and the contractor for purposes of enforcing the provisions of the Labor Code and other social legislation, to the extent of the work performed under the employment contract.

However, the principal shall be deemed the direct employer of the contractor’s employee in cases where there is a finding by a competent authority of labor-only contracting, or commission of prohibited activities as provided in Section 7, or a violation of either Sections 8 or 9 hereof.

Section 6. Prohibition against labor-only contracting. Labor-only contracting is hereby declared prohibited. For this purpose, labor only contracting shall refer to an arrangement where:

(a) The contractor does not have substantial capital or investments in the form of tools, equipment, machineries, work premises, among others, and the employees recruited and placed are performing activities which are usually necessary or desirable to the operation of the company, or directly related to the main business of the principal within a definite or predetermined period, regardless of whether such job, work or service is to be performed or completed within or outside the premises of the principal; or

(b) The contractor does not exercise the right to control over the performance of the work of the employee.

Section 7. Other Prohibitions. Notwithstanding Section 6 of these Rules, the following are hereby declared prohibited for being contrary to law or public policy:

A. Contracting out of jobs, works or services when not done in good faith and not justified by the exigencies of the business such as the following:

(1) Contracting out of jobs, works or services when the same results in the termination or reduction of regular employees and reduction of work hours or reduction or splitting of the bargaining unit.

(2) Contracting out of work with a “Cabo”.

(3) Taking undue advantage of the economic situation or lack of bargaining strength of the contractor’s employees, or undermining their security of tenure or basic rights, or circumventing the provisions of regular employment, in any of the following instances:

(i) Requiring them to perform functions which are currently being performed by the regular employees of the principal; and

(ii) Requiring them to sign, as a precondition to employment or continued employment, an antedated resignation letter; a blank payroll; a waiver of labor standards including minimum wages and social or welfare benefits; or a quitclaim releasing the principal, contractor or from any liability as to payment of future claims.

(4) Contracting out of a job, work or service through an in-house agency.

(5) Contracting out of a job, work or service that is necessary or desirable or directly related to the business or operation of the principal by reason of a strike or lockout whether actual or imminent.

(6) Contracting out of a job, work or service being performed by union members when such will interfere with, restrain or coerce employees in the exercise of their rights to self-organization as provided in Art. 248 (c) of the Labor Code, as amended.

(7) Repeated hiring of employees under an employment contract of short duration or under a Service Agreement of short duration with the same or different contractors, which circumvents the Labor Code provisions on Security of Tenure.

(8) Requiring employees under a subcontracting arrangement to sign a contract fixing the period of employment to a term shorter than the term of the Service Agreement, unless the contract is divisible into phases for which substantially different skills are required and this is made known to the employee at the time of engagement.

(9) Refusal to provide a copy of the Service Agreement and the employment contracts between the contractor and the employees deployed to work in the bargaining unit of the principal’s certified bargaining agent to the sole and exclusive bargaining agent (SEBA).

(10) Engaging or maintaining by the principal of subcontracted employees in excess of those provided for in the applicable Collective Bargaining Agreement (CBA) or as set by the Industry Tripartite Council (ITC).

B. Contracting out of jobs, works or services analogous to the above when not done in good faith and not justified by the exigencies of the business.

Section 8. Rights of contractor’s employees. All contractor’s employees, whether deployed or assigned as reliever, seasonal, week-ender, temporary, or promo jobbers, shall be entitled to all the rights and privileges as provided for in the Labor Code, as amended, to include the following:

(a) Safe and healthful working conditions;

(b) Labor standards such as but not limited to service incentive leave, rest days, overtime pay, holiday pay, 13th month pay, and separation pay as may be provided in the Service Agreement or under the Labor Code;

(c) Retirement benefits under the SSS or retirement plans of the contractor, if there is any;

(d) Social security and welfare benefits;

(e) Self-organization, collective bargaining and peaceful concerted activities; and

(f) Security of tenure.

Section 9. Required contracts under these Rules.

(a) Employment contract between the contractor and its employee.

Notwithstanding any oral or written stipulations to the contrary, the contract between the contractor and its employee shall be governed by the provisions of Articles 279 and 280 of the Labor Code, as amended. It shall include the following terms and conditions:

i. The specific description of the job, work or service to be performed by the employee;

ii. The place of work and terms and conditions of employment, including a statement of the wage rate applicable to the individual employee; and

iii. The term or duration of employment that must be co-extensive with the Service Agreement or with the specific phase of work for which the employee is engaged.

The contractor shall inform the employee of the foregoing terms and conditions of employment in writing on or before the first day of his/her employment.

(b) Service Agreement between the principal and the contractor. The Service Agreement shall include the following:

i. The specific description of the job, work or service being subcontracted.

ii. The place of work and terms and conditions governing the contracting arrangement, to include the agreed amount of the services to be rendered, the standard administrative fee of not less than ten percent (10%) of the total contract cost.

iii. Provisions ensuring compliance with all the rights and benefits of the employees under the Labor Code and these Rules on: provision for safe and healthful working conditions; labor standards such as, service incentive leave, rest days, overtime pay, 13th month pay and separation pay; retirement benefits; contributions and remittance of SSS, Philhealth, PagIbig Fund, and other welfare benefits; the right to self-organization, collective bargaining and peaceful concerted action; and the right to security of tenure.

iv. A provision on the Net Financial Contracting Capacity of the contractor, which must be equal to the total contract cost.

v. A provision on the issuance of the bond/s as defined in Section 3(m) renewable every year.

vi. The contractor or subcontractor shall directly remit monthly the employers’ share and employees’ contribution to the SSS, ECC, Philhealth and Pagibig.

vii. The term or duration of engagement. The Service Agreement must conform to the DOLE Standard Computation and Standard Service Agreement, which form part of these Rules as Annexes “A” and “B”.

Section 10. Duties of the principal. Pursuant to the authority of the Secretary of Labor and Employment to restrict or prohibit the contracting of labor to protect the rights of the workers and to ensure compliance with the provisions of the Labor Code, as amended, the principal, as the indirect employer or the user of the services of the contractor, is hereby required to observe the provisions of these Rules.

Section 11. Security of tenure of contractor’s employees. It is understood that all contractor’s employees enjoy security of tenure regardless of whether the contract of employment is co-terminus with the service agreement, or for a specific job, work or service, or phase thereof.

Section 12. Observance of required standards of due process; requirements of notice. In all cases of termination of employment, the standards of due process laid down in Article 277(b) of the Labor Code, as amended, and settled jurisprudence on the matter2, must be observed. Thus, the following is hereby set out to clarify the standards of due process that must be observed:

2 King of Kings Transport, Inc., Claire dela Fuente, and Melissa Lim, vs. Santiago O. Mamac, G.R. No. 166208, (29 June 2007); and Felix B. Perez and Amante G. Doria v. Philippine Telegraph and Telephone Company and Jose Luis Santiago, G.R. No. 152048, (7 April 2009), (en banc Decision).

I. For termination of employment based on just causes as defined in Article 282 of the Code, the requirement of two written notices served on the employee shall observe the following:

(A) The first written notice should contain:

(1) The specific causes or grounds for termination;

(2) Detailed narration of the facts and circumstances that will serve as basis for the charge against the employee. A general description of the charge will not suffice;

(3) The company rule, if any, that is violated and/or the ground under Art. 282 that is being charged against the employee; and

(4) A directive that the employee is given opportunity to submit a written explanation within a reasonable period.

“Reasonable period” should be construed as a period of at least five (5) calendar days from receipt of the notice to give the employee an opportunity to study the accusation, consult a union official or lawyer, gather data and evidence, and decide on the defenses against the complaint.

(B) After serving the first notice, the employer should afford the employee ample opportunity to be heard and to defend himself/herself with the assistance of his/her representative if he/she so desires, as provided in Article 277(b) of the Labor Code, as amended.

“Ample opportunity to be heard” means any meaningful opportunity (verbal or written) given to the employee to answer the charges against him/her and submit evidence in support of his/her defense, whether in a hearing, conference or some other fair, just and reasonable way. A formal hearing or conference becomes mandatory only when requested by the employee in writing or substantial evidentiary disputes exist or a company rule or practice requires it, or when similar circumstances justify it.

(C) After determining that termination of employment is justified, the employer contractor shall serve the employee a written notice of termination indicating that: (1) all circumstances involving the charge against the employees have been considered; and (2) the grounds have been established to justify the severance of their employment. The foregoing notices shall be served on the employee’s last known address.

II. For termination of employment based on authorized causes defined in Article 283 of the Labor Code, the requirement of due process shall be deemed complied with upon service of a written notice to the employee and the appropriate regional office of the Department of Labor and Employment at least thirty days before the effectivity of the termination, specifying the ground or grounds for termination.

III. If the termination is brought about by the completion of the contract or phase thereof, no prior notice is required. If the termination is brought about by the failure of a probationary employee to meet the reasonable standards of the employer, which was made known to the employee at the time of his/her employment, it shall be sufficient that a written notice is served upon the employee within a reasonable time prior to the expiration of the probationary period.

Section 13. Effect of termination of employment. The termination of employment of the contractor employee prior to the expiration of the Service Agreement shall be governed by Articles 282, 283 and 284 of the Labor Code.

In case the termination of employment is caused by the pre-termination of the Service Agreement not due to authorized causes under Article 283, the right of the contractor employee to unpaid wages and other unpaid benefits including unremitted legal mandatory contributions, e.g., SSS, Philhealth, Pag-ibig, ECC, shall be borne by the party at fault, without prejudice to the solidary liability of the parties to the Service Agreement.

Where the termination results from the expiration of the service agreement, or from the completion of the phase of the job, work or service for which the employee is engaged, the latter may opt for payment of separation benefits as may be provided by law or the Service Agreement, without prejudice to his/her entitlement to the completion bonuses or other emoluments, including retirement benefits whenever applicable.

Section 14. Mandatory Registration and Registry of Legitimate Contractors. Consistent with the authority of the Secretary of Labor and Employment to restrict or prohibit the contracting out of labor to protect the rights of workers, it shall be mandatory for all persons or entities, including cooperatives, acting as contractors, to register with the Regional Office of the Department of Labor and Employment (DOLE) where it principally operates.

Failure to register shall give rise to the presumption that the contractor is engaged in labor-only contracting.

Accordingly, the registration system governing contracting arrangements and implemented by the Regional Offices of the DOLE is hereby established, with the Bureau of Working Conditions (BWC) as the central registry.

Section 15. Requirements for registration. The application for registration as a contractor shall be filed at the DOLE Regional Office in the region where it seeks to principally operate. The applicant shall provide in the application form the following information:

(a) The name and business address of the applicant and the areas where it seeks to operate;

(b) The names and addresses of officers, if the applicant is a corporation, partnership, cooperative or a labor organization;

(c) The nature of the applicant’s business and the industry or industries where the applicant seeks to operate;

(d) The number of regular workers and the total workforce;

(e) The list of clients, if any, the number of personnel assigned to each client, if any, and the services provided to the client;

(f) The description of the phases of the contract, including the number of employees covered in each phase, where appropriate; and

(g) Proof of compliance with substantial capital requirement as defined in Section 3(l) of these Rules.

The application shall be supported by:

(a) A certified true copy of a certificate of registration of firm or business name from the Securities and Exchange Commission (SEC), Department of Trade and Industry (DTI), Cooperative Development Authority (CDA), or from the DOLE if the applicant is a labor organization;

(b) A certified true copy of the license or business permit issued by the local government unit or units where the contractor operates;

(c) A certified listing, with proof of ownership or lease contract, of facilities, tools, equipment, premises implements, machineries and work premises, that are actually and directly used by the contractor in the performance or completion of the job, work or service contracted out. In addition, the applicant shall submit a photo of the office building and premises where it holds office;

(d) A copy of audited financial statements if the applicant is a corporation, partnership, cooperative or a labor organization, or copy of the latest ITR if the applicant is a sole proprietorship; and

(e) A sworn disclosure that the registrant, its officers and owners or principal stockholders or any one of them, has not been operating or previously operating as a contractor under a different business name or entity or with pending cases of violations of these Rules and/or labor standards, or with a cancelled registration. In case any of the foregoing has a pending case, a copy of the complaint and the latest status of the case shall be attached.

The application shall be verified. It shall include a DOLE certification of attendance to orientation seminar on these Rules and an undertaking that the contractor shall abide by all applicable labor laws and regulations.

Section 16. Filing and processing of application. The application with all supporting documents shall be filed in triplicate in the Regional Office where the applicant principally operates. No application for registration shall be accepted unless all the requirements in the preceding Section are complied with.

Section 17. Verification inspection. Within two (2) working days upon receipt of the application with complete supporting documents, the authorized representative of the Regional Director shall conduct a verification inspection of the facilities, tools, equipment, and work premises of the applicant.

Section 18. Approval or denial of the application. The Regional Office shall deny or approve the application within one (1) working day after the verification inspection.

Applications that fail to meet the requirements set forth in Section 15 of these Rules shall be denied.

Section 19. Registration fee. Payment of registration fee of Twenty-Five Thousand Pesos (P25,000.00) shall be required upon approval of the application.

Upon registration, the Regional Office shall return one set of the duly-stamped application documents to the applicant, retain one set for its file, and transmit the remaining set to the Bureau of Working Conditions (BWC) within five (5) days from registration.

Section 20. Validity of certificate of registration of contractors. The contractor shall be deemed registered only on the date of issuance of its Certificate of Registration.

The Certificate of Registration shall be effective for three (3) years, unless cancelled after due process. The same shall be valid in the region where it is registered.

In case the contractor has Service Agreements or operates outside the region where it is registered, it shall request a duly authenticated copy of its Certificate of Registration from the registering Regional Office and submit the same to the DOLE Regional Office where it seeks to operate, together with a copy of its Service Agreement/s in the area, for purposes of monitoring compliance with these Rules.

Section 21. Renewal of registration. All registered contractors shall apply for renewal of their Certificates of Registration thirty (30) days before the expiration of their registration to remain in the roster of legitimate service contractors. The applicant shall pay a registration renewal fee of Twenty-Five Thousand Pesos (P25,000.00) to the DOLE Regional Office.

Copies of all the updated supporting documents in letters (a) to (e) of Section 15 hereof shall be attached to the duly accomplished application form, including the following:

(a) Certificate of membership and proof of payment of SSS, Philhealth, BIR, ECC and Pag-Ibig contributions for the last three (3) years, as well as loan amortizations; and

(b) Certificate of pending or no pending labor standards violation case/s with the National Labor Relations Commission (NLRC) and Department of Labor and Employment (DOLE). The pendency of a case will not prejudice the renewal of the registration, unless there is a finding of violation of labor standards by the DOLE Regional Director.

Section 22. Semi-annual reporting. The contractor shall submit in triplicate its subscribed semi-annual report using a prescribed form to the appropriate Regional Office. The report shall include:

(a) A list of contracts entered with the principal during the subject reporting period;

(b) The number of workers covered by each contract with the principal;

(c) Proof of payment of remittances to the Social Security System (SSS), the Pag-Ibig Fund, Philhealth, Employees Compensation Commission (ECC), and Bureau of Internal Revenue (BIR) due its employees during the subject reporting period and of amortization of declared loans due from its employees; and

(d) A certified listing of all cases filed against the contractor before the NLRC

The Regional Office shall return one set of the duly-stamped report to the contractor, retain one set for its file, and transmit the remaining set to the Bureau of Working Conditions (BWC) within five (5) days from receipt thereof.

Section 23. Grounds for cancellation of registration. The Regional Director shall, upon a verified complaint, cancel or revoke the registration of a contractor after due process, based on any of the following grounds:

(a) Misrepresentation of facts in the application;

(b) Submission of a falsified or tampered application or supporting documents to the application for registration;

(c) Non-submission of Service Agreement between the principal and the contractor when required to do so;

(d) Non-submission of the required semi-annual report as provided in Section 22 (Semi-annual reporting) hereof;

(e) Findings through arbitration that the contractor has engaged in labor-only contracting and/or the prohibited activities as provided in Section 7 (Other Prohibitions) hereof;

(f) Non-compliance with labor standards and working conditions;

(g) Findings of violation of Section 8 (Rights of contractor’s employees) or Section 9 (Required contracts) of these Rules;

(h) Non-compliance with SSS, the HDMF, Pag-Ibig, Philhealth, and ECC laws; and

(i) Collecting any fees not authorized by law and other applicable rules and regulations.

Section 24. Due process in cancellation of registration. Complaint/s based on any of the grounds enumerated in the preceding Section against the contractor shall be filed in writing and under oath with the Regional Office which issued the Certificate of Registration.

The complaint/s shall state the following:

(a) The name/s and address/es of the complainant/s;

(b) Name and address of the contractor;

(c) The ground/s for cancellation;

(d) When and where the action complained of happened;

(e) The amount of money claim, if any; and

(f) The relief/s sought.

Upon receipt of the complaint, the Regional Director shall direct the contractor, with notice to the complainant, to file a verified answer/counter affidavit within ten (10) calendar days without extension, incorporating therein all pertinent documents in support of his/her defenses, with proof of service of a copy to the complainant. Failure to file an answer/counter affidavit shall constitute a waiver on the part of the respondent. No motion to dismiss shall be entertained.

The Regional Director or his duly authorized representative may conduct a clarificatory hearing within the prescribed ten (10) calendar days within which to file a verified answer/counter affidavit.

Within the said ten (10) calendar days period, the contractor shall make the necessary corrections/rectifications on the violations that are immediately rectifiable upon its own initiative in order to be fully compliant.

The Regional Director may avail himself of all reasonable means to ascertain the facts of the case, including conduct of inspection, where appropriate, and examination of informed persons.

The proceedings before the Regional Office shall be summary in nature.

The conduct of hearings shall be terminated within fifteen (15) calendar days from the first scheduled clarificatory hearing. The Regional Director shall resolve the case within ten (10) working days from the date of the last hearing. If there is no necessity to conduct a hearing, the case shall be resolved within ten (10) working days from receipt of the verified answer/counter affidavit.

Any motion for reconsideration from the Order of the Regional Director shall be treated as an appeal.

Section 25. Appeal. The Order of the Regional Director is appealable to the Secretary within ten (10) working days from receipt of the copy of the Order. The appeal shall be filed with the Regional Office which issued the cancellation Order. The Office of the Secretary shall have thirty (30) working days from receipt of the records of the case to resolve the appeal. The Decision of the Secretary shall become final and executory after ten (10) days from receipt thereof by the parties. No motion for reconsideration of the Decision shall be entertained.

Section 26. Effects of cancellation of registration. A final Order of cancellation shall divest the contractor of its legitimate status to engage in contracting/subcontracting.

Such Order of cancellation shall be a ground to deny an application for renewal of registration to a contractor under the Rules.

The cancellation of the registration of the contractor for engaging in labor-only contracting or for violation of any of the provisions of these Rules involving a particular Service Agreement will not, however, impair the validity of existing legitimate jobcontracting arrangements the contractor may have entered into with other principals prior to the cancellation of its registration. Any valid and subsisting Service Agreement shall be respected until its expiration; thereafter, contracting with a delisted contractor shall make the principal direct employer of all employees under the Service Agreement pursuant to Articles 106 and 109 of the Labor Code.

Section 27. Effects of finding of labor-only contracting and/or violation of Sections 7. 8 or 9 of the Rules. A finding by competent authority of labor-only contracting shall render the principal jointly and severally liable with the contractor to the latter's employees, in the same manner and extent that the principal is liable to employees directly hired by him/her, as provided in Article 106 of the Labor Code, as amended.

A finding of commission of any of the prohibited activities in Section 7, or violation of either Sections 8 or 9 hereof, shall render the principal the direct employer of the employees of the contractor or subcontractor, pursuant to Article 109 of the Labor Code, as amended.

Section 28. Retaliatory measures. Pursuant to Article 118 of the Labor Code, as amended, it shall be unlawful for the principal, contractor, or any party privy to the contract or services provided to refuse to pay or reduce the wages and benefits, and discharge or in any manner discriminate against any worker who has filed any complaint or instituted any proceeding on wages (under Title II, Book III of the Labor Code), labor standards violation, or has testified or is about to testify in such proceedings.

Section 29. Enforcement of labor standards and working conditions. Consistent with Article 128 (Visitorial and Enforcement Power) of the Labor Code, as amended, the Regional Director through his/her duly authorized representatives, shall conduct routine inspection of establishments engaged in contracting arrangement regardless of the number of employees engaged by the principal or by the contractor.

They shall have access to employer’s records and premises at any time of the day or night whenever work is being undertaken therein, and the right to copy therefrom, to question any employee and investigate any fact, condition or matter which may be necessary to determine violations or which may aid in the enforcement of the Labor Code and of any labor law, wage order, or rules and regulations issued pursuant thereto.

The findings of the duly authorized representative shall be referred to the Regional Director for appropriate action as provided for in Article 128, and shall be furnished the collective bargaining agent, if any.

Based on the visitorial and enforcement power of the Secretary of Labor and Employment in Article 128 (a), (b), (c), and (d), the Regional Director shall issue compliance orders to give effect to the labor standards provisions of the Labor Code, other labor legislation, and these Rules.

Section 30. Duty to produce copy of contract between the principal and the contractor. The principal or the contractor shall be under an obligation to produce a copy of the Service Agreement in the ordinary course of inspection. The contractor shall likewise be under an obligation to produce a copy of any contract of employment when directed to do so by the Regional Office Director or his/her authorized representative.

Section 31. Tripartite implementation and monitoring of compliance; Use of registration fees. A region-based tripartite monitoring team on the observance of labor standards in contracting and subcontracting arrangements shall be constituted as a subcommittee of the Regional Tripartite Industrial Peace Council (RTIPC) within fifteen (15) days from the effectivity of these Rules. It shall submit a quarterly regional monitoring report to the DOLE Secretary and to the National Tripartite Industrial Peace Council (NTIPC). The Bureau of Working Conditions (BWC) shall ensure the implementation of this provision, and shall conduct capacity building to the members of the regional tripartite monitoring team.

For this purpose, a portion of the collected registration fees shall be used in the operation of the region-based tripartite monitoring team, including in the development of an internet-based monitoring system and database. It shall likewise be used for transmittal of the monthly report of all registered contractors to the Bureau of Local Employment (BLE), and in generating labor market information.

Section 32. Oversight function of the National TIPC. The National Tripartite Industrial Peace Council (NTIPC) as created under Executive Order No. 49, Series of 1998, as amended, shall serve as the oversight committee to verify and monitor the following:

(a) Engagement in allowable contracting activities; and

(b) Compliance with administrative reporting requirements.

Section 33. Collective bargaining and/or Industry Tripartite Council (ITC). Nothing herein shall preclude the parties in collective bargaining agreements (CBAs) to determine the functions that can or cannot be farmed out or contracted out to a legitimate contractor, including the terms and conditions of the workers’ engagement under the arrangement, provided the provisions of these Rules are observed.

In industries with established Industry Tripartite Councils (ITCs), the tripartite partners may agree, through a voluntary code of good practices, on the functions or processes that can or cannot be contracted out to a legitimate contractor.

Section 34. Financial Relief Program; Tripartite Co-Regulation Engagement. A Financial Relief Program or Unemployment Assistance Fund shall be established for employees under a Service Agreement or employees in transition from one Service Agreement to the next. For this purpose, the National Tripartite Industrial Peace Council (NTIPC), upon the effectivity of this issuance, shall constitute a Local Service Provider Tripartite Working Group (LSP-TWG) composed of representatives of the stakeholders in the industry. The LSP-TWG shall:

(a) Recommend the mechanics and details in setting up the Financial Relief Program or Unemployment Assistance Fund with proposed funding sources before end of June 2012; and

(b) Draw-up the terms of a Tripartite Co-Regulation Engagement in ensuring full compliance with labor laws for approval/endorsement by the NTIPC, including a proposed Table of Progressive Rate of Increases in the minimum capitalization requirement at reasonable intervals to ensure that only legitimate contractors can engage in subcontracting arrangement.

Section 35. Enrollment in DOLE programs on improving compliance with labor standards. For purposes of ensuring compliance with labor standards, the principal and subcontractors covered by these Rules are encourage to enroll and participate in the DOLE Kapatiran Work Improvement for Small Enterprise (WISE)-TAV Program (Department Advisory No. 06, dated 07 March 2011) and/or in the Incentivizing Compliance Program (Department Order No. 115-11).

Section 36. Contracting or subcontracting arrangements in the Construction and Other Industries. Contracting or subcontracting arrangements in the Construction Industry, under the licensing coverage of the Philippine Construction Accreditation Board (PCAB), shall be covered by the applicable provisions of these Rules and shall continue to be governed by Department Order No. 19, Series of 1993 (Guidelines Governing the Employment of Workers in the Construction Industry); Department Order No. 13, Series of 1998 (Guidelines Governing the Occupational Safety and Health in the Construction Industry); and DOLE-DPWH-DILG-DTI and PCAB Memorandum of Agreement-Joint Administrative Order No. 1, Series of 2011 (on coordination and harmonization of policies and programs on occupational safety and health in the construction industry).

In industries covered by a separate regulation of the DOLE or other government agency, contracting or subcontracting therein shall be governed by these Rules unless expressly provided otherwise.

Section 37. Prohibition on DOLE officials or employees. Any official or employee of the DOLE or its attached agencies is prohibited from engaging or having any interest in any contracting or subcontracting business.

Section 38. Non-impairment of existing contracts; Non-diminution of benefits. Subject to the provisions of Articles 106 to 109 of the Labor Code, as amended, the applicable provisions of the Civil Code and existing jurisprudence, nothing herein shall impair the rights or diminish the benefits being enjoyed by the parties to existing contracting or subcontracting arrangements.

The effectivity of Certificates of Registration acquired under Department Order No. 18, Series of 2002, issued on 21 February 2002, shall be respected until expiration.

Section 39. Supersession. All rules and regulations issued by the Secretary of Labor and Employment inconsistent with the provisions of these Rules are hereby superseded.

Section 40. Separability Clause. If any provision or portion of these Rules are declared void or unconstitutional, the remaining portions or provisions hereof shall continue to be valid and effective.

Section 41. Effectivity. This Department Order shall be effective fifteen (15) days after completion of its publication in a newspaper of general circulation.

Manila, Philippines, 14 November 2011.

ROSALINDA DIMAPILIS-BALDOZ
Secretary

 

THE 2011 NLRC RULES OF PROCEDURE

This revised rules took effect on August 7, 2011. Get the pdf copy here.

THE 2011 NLRC RULES OF PROCEDURE

Pursuant to the provisions of Article 218 of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines, the following Revised Rules of Procedure governing arbitration proceedings before the Labor Arbiters and the Commission are hereby adopted and promulgated:

RULE I TITLE AND CONSTRUCTION

SECTION 1. TITLE OF THE RULES. - These Rules shall be known as the "2011 NLRC Rules of Procedure." (1a)

SECTION 2. CONSTRUCTION. - These Rules shall be liberally construed to carry out the objectives of the Constitution, the Labor Code of the Philippines and other relevant legislations, and to assist the parties in obtaining just, expeditious and inexpensive resolution and settlement of labor disputes.

SECTION 3. SUPPLETORY APPLICATION OF THE RULES OF COURT. - In the absence of any applicable provision in these Rules, and in order to effectuate the objectives of the Labor Code, the pertinent provisions of the Rules of Court of the Philippines may, in the interest of expeditious dispensation of labor justice and whenever practicable and convenient, be applied by analogy or in a suppletory character and effect.

RULE II DEFINITION OF TERMS

SECTION 1. DEFINITIONS. - The terms and phrases defined in Article 212 of the Labor Code, as amended, shall be given the same meanings when used herein. As used herein, "Regional Arbitration Branch" shall mean any of the regional arbitration branches or sub-regional branches of the Commission.

RULE III PLEADINGS, NOTICES AND APPEARANCES

SECTION 1. COMPLAINT. - a) A complaint or petition is a pleading alleging the cause or causes of action of the complainant or petitioner. The names and addresses of all complainants or petitioners and respondents must be stated in the complaint or petition. It shall be signed under oath by the complainant or petitioner, with a declaration of non-forum shopping.

b) A party having more than one cause of action against the other party, arising out of the same relationship, shall include all of them in one complaint or petition. (1a)

SECTION 2. CAPTION AND TITLE. - In all cases filed with the Commission or with any of its Regional Arbitration Branches, the party initiating the action shall be called the "Complainant" or "Petitioner", and the opposing party the "Respondent".

The full names of all the real parties in interest, whether natural or juridical persons or entities authorized by law, shall be stated in the caption of the complaint or petition, as well as in the decisions, resolutions or orders of the Labor Arbiter or the Commission.

SECTION 3. FILING AND SERVICE OF PLEADINGS. - All pleadings in connection with a case shall be filed with the appropriate docketing unit of the Regional Arbitration Branch or the Commission, as the case may be.

The party filing a pleading shall serve the opposing parties with a copy and its supporting documents. No pleading shall be considered without proof of service to the opposing parties except if filed simultaneously during a schedule set before the Labor Arbiter. (5a)

SECTION 4. SERVICE OF NOTICES, RESOLUTIONS, ORDERS AND DECISIONS. - a) Notices and copies of resolutions or orders, shall be served personally upon the parties by the bailiff or duly authorized public officer within three (3) days from his/her receipt thereof or by registered mail or by private courier;

b) In case of decisions and final awards, copies thereof shall be served on both parties and their counsel or representative by registered mail or by private courier; Provided that, in cases where a party to a case or his/her counsel on record personally seeks service of the decision upon inquiry thereon, service to said party shall be deemed effected as herein provided. Where parties are numerous, service shall be made on counsel and upon such number of complainants, as may be practicable and shall be considered substantial compliance with Article 224 (a) of the Labor Code, as amended.

For purposes of appeal, the period shall be counted from receipt of such decisions, resolutions, or orders by the counsel or representative of record.

c) The bailiff or officer serving the notice, order, or resolution shall submit his/her return within two (2) days from date of service thereof, stating legibly in his/her return his/her name, the names of the persons served and the date of receipt, which return shall be immediately attached and shall form part of the records of the case. In case of service by registered mail or by private courier, the name of the addressee and the date of receipt of the notice, order or resolution shall be written in the return card or in the proof of service issued by the private courier. If no service was effected, the reason thereof shall be so stated. (6a)

SECTION 5. PROOF AND COMPLETENESS OF SERVICE. - The return is prima facie proof of the facts indicated therein. Service by registered mail or by private courier is complete upon receipt by the addressee or his/her agent. If the addressee fails to claim his/her mail from the post office within five (5) days from the date of first notice of the postmaster, service shall take effect after such time. (7a)

SECTION 6. APPEARANCES. - a) A lawyer appearing for a party is presumed to be properly authorized for that purpose. In every case, he/she shall indicate in his/her pleadings and motions his/her Attorney's Roll Number, as well as his/her PTR and IBP numbers for the current year and MCLE compliance.

b) A non-lawyer may appear in any of the proceedings before the Labor Arbiter or Commission only under the following conditions:

(1) he/she represents himself/herself as party to the case;

(2) he/she represents a legitimate labor organization, as defined under Article 212 and 242 of the Labor Code, as amended, which is a party to the case: Provided, that he/she presents to the Commission or Labor Arbiter during the mandatory conference or initial hearing: (i) a certification from the Bureau of Labor Relations (BLR) or Regional Office of the Department of Labor and Employment attesting that the organization he/she represents is duly registered and listed in the roster of legitimate labor organizations; (ii) a verified certification issued by the secretary and attested to by the president of the said organization stating that he/she is authorized to represent the said organization in the said case; and (iii) a copy of the resolution of the board of directors of the said organization granting him such authority;

(3)he/she represents a member or members of a legitimate labor organization that is existing within the employer's establishment, who are parties to the case: Provided, that he/she presents: (i) a verified certification attesting that he/she is authorized by such member or members to represent them in the case; and (ii) a verified certification issued by the secretary and attested to by the president of the said organization stating that the person or persons he/she is representing are members of their organization which is existing in the employer's establishment;

(4) he/she is a duly-accredited member of any legal aid office recognized by the Department of Justice or Integrated Bar of the Philippines: Provided, that he/she (i) presents proof of his/her accreditation; and (ii) represents a party to the case;

(5) he/she is the owner or president of a corporation or establishment which is a party to the case: Provided, that he/she presents: (i) a verified certification attesting that he/she is authorized to represent said corporation or establishment; and (ii) a copy of the resolution of the board of directors of said corporation, or other similar resolution or instrument issued by said establishment, granting him/her such authority.

c) Appearances of a non-lawyer in contravention of this section shall not be recognized in any proceedings before the Labor Arbiter or the Commission.

d) Appearances may be made orally or in writing. In both cases, the complete name and office address of counsel or authorized representative shall be made of record and the adverse party or his counsel or authorized representative properly notified.

e) In case of change of address, the counsel or representative shall file a notice of such change, copy furnished the adverse party and counsel or representative, if any.

f) Any change or withdrawal of counsel or authorized representative shall be made in accordance with the Rules of Court. (8a)

SECTION 7. AUTHORITY TO BIND PARTY.- Counsel or other authorized representatives of parties shall have authority to bind their clients in all matters of procedure; but they cannot, without a special power of attorney or express consent, enter into a compromise agreement with the opposing party in full or partial discharge of a client's claim. (9a)

RULE IV VENUE, ASSIGNMENT AND DISPOSITION OF CASES AT THE REGIONAL ARBITRATION BRANCH

SECTION 1. VENUE. - a) All cases which Labor Arbiters have authority to hear and decide may be filed in the Regional Arbitration Branch having jurisdiction over the workplace of the complainant or petitioner. For purposes of venue, the workplace shall be understood as the place or locality where the employee is regularly assigned at the time the cause of action arose. It shall include the place where the employee is supposed to report back after a temporary detail, assignment, or travel. In case of field employees, as well as ambulant or itinerant workers, their workplace is where they are regularly assigned, or where they are supposed to regularly receive their salaries and wages or work instructions from, and report the results of their assignment to, their employers.

b) Where two (2) or more Regional Arbitration Branches have jurisdiction over the workplace of the complainant or petitioner, the Branch that first acquired jurisdiction over the case shall exclude the others. c) When venue is not objected to before the filling of position papers such issue shall be deemed waived.

d) The venue of an action may be changed or transferred to a different Regional Arbitration Branch other than where the complaint was filed by written agreement of the parties or when the Commission or Labor Arbiter before whom the case is pending so orders, upon motion by the proper party in meritorious cases.

e) Cases involving overseas Filipino workers may be filed before the Regional Arbitration Branch having jurisdiction over the place where the complainant resides or where the principal office of any of the respondents is situated, at the option of the complainant.

SECTION 2. RAFFLE AND ASSIGNMENT OF CASES. - a) All complaints and petitions filed with the docket unit of the Regional Arbitration Branch shall be immediately raffled and assigned to a Labor Arbiter from receipt thereof.

b) The Executive Labor Arbiter shall be responsible for the immediate raffle and assignment of all complaints and petitions filed with his/her Regional Arbitration Branch, and the immediate forwarding of all subsequent pleadings and motions.

c) All pleadings and motions subsequent to the filing of the complaint shall be forwarded to the Labor Arbiter before whom the case is pending within twenty-four (24) hours from receipt thereof.

SECTION 3. CONSOLIDATION OF CASES AND COMPLAINTS. - Where there are two or more cases or complaints pending before different Labor Arbiters in the same Regional Arbitration Branch involving the same employer and common principal causes of action, or the same parties with different causes of action, the subsequent cases or complaints shall be consolidated with the first to avoid unnecessary costs or delay. Such consolidated cases or complaints shall be disposed of by the Labor Arbiter to whom the first case was assigned.

In case of objection to the consolidation, the same shall be resolved by the Executive Labor Arbiter. An order resolving a motion or objection to consolidation shall be inappealable.

SECTION 4. DISPOSITION OF CASES. - Subject to the provisions of Article 263 (g) of the Labor Code, as amended, when a case is assigned to a Labor Arbiter, the entire case and any or all incidents thereto shall be considered assigned to him/her; and the same shall be disposed of in the same proceedings to avoid multiplicity of suits or proceedings.

When the Secretary of Labor and Employment has assumed jurisdiction over a strike or lockout or certified the same to the Commission, the parties to such dispute shall immediately inform the Secretary or the Commission, as the case may be, of all cases directly related to the dispute between them pending before any Regional Arbitration Branch, and the Labor Arbiters handling the same of such assumption or certification. The Labor Arbiter concerned shall forward within two (2) days from notice the entire records of the case to the Commission or to the Secretary of Labor, as the case may be, for proper disposition.

RULE V PROCEEDINGS BEFORE LABOR ARBITERS

SECTION 1. JURISDICTION OF LABOR ARBITERS. - Labor Arbiters shall have original and exclusive jurisdiction to hear and decide the following cases involving all workers, whether agricultural or non-agricultural: a) Unfair labor practice cases;

b) Termination disputes;

c) If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment;

d) Claims for actual, moral, exemplary and other forms of damages arising from employer-employee relations;

e) Cases arising from any violation of Article 264 of the Labor Code, as amended, including questions involving the legality of strikes and lockouts;

f)Except claims for employees compensation not included in the next succeeding paragraph, social security, medicare, and maternity benefits, all other claims arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding Five Thousand Pesos (P5,000.00), whether or not accompanied with a claim for reinstatement;

g) Wage distortion disputes in unorganized establishments not voluntarily settled by the parties pursuant to Republic Act No. 6727;

h) Enforcement of compromise agreements when there is non-compliance by any of the parties pursuant to Article 227 of the Labor Code, as amended;

i) Money claims arising out of 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 as provided by Section 10 of RA 8042, as amended by RA 10022; and

j) Other cases as may be provided by law.

Cases arising from the interpretation or implementation of collective bargaining agreements and those arising from the interpretation or enforcement of company personnel policies shall be disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration, as may be provided in said agreements. (1a)

SECTION 2. NATURE OF PROCEEDINGS. - The proceedings before the Labor Arbiter shall be non-litigious in nature. Subject to the requirements of due process, the technicalities of law and procedure and the rules obtaining in the courts of law shall not strictly apply thereto. The Labor Arbiter may avail himself/herself of all reasonable means to ascertain the facts of the controversy speedily, including ocular inspection and examination of well-informed persons.

SECTION 3. ISSUANCE OF SUMMONS. - Within two (2) days from receipt of a complaint or amended complaint, the Labor Arbiter shall issue the required summons, attaching thereto a copy of the complaint or amended complaint and its annexes, if any. The summons shall specify the date, time and place of the mandatory conciliation and mediation conference in two (2) settings. (3a, RIII)

SECTION 4. SERVICE OF SUMMONS. - Summons shall be served personally upon the parties by the bailiff or a duly authorized public officer within three (3) days from his/her receipt thereof, or by registered mail, or by private courier authorized by the Commission; Provided that in special circumstances, service of summons may be effected in accordance with the pertinent provisions of the Rules of Court.

The bailiff or officer serving the summons shall submit his/her return within two (2) days from date of service thereof, stating legibly in his/her return his/her name, the names of the persons served and the date of receipt, which return shall be immediately attached to the records and shall be part thereof. If no service was effected, the reason thereof shall be stated in the return.

In case of service by registered mail or by private courier, the names of the addressees and the dates of receipt of the summons shall be written in the return card or in the proof of service issued by the private courier. If no service was effected, the reason thereof shall be so stated. (n)

SECTION 5. PROHIBITED PLEADINGS AND MOTIONS. - The following pleadings and motions shall not be allowed and acted upon nor elevated to the Commission:

a) Motion to dismiss the complaint except on the ground of lack of jurisdiction over the subject matter, improper venue, res judicata, prescription and forum shopping;

b) Motion for a bill of particulars;

c) Motion for new trial;

d) Petition for Relief from Judgment

e) Motion to declare respondent in default;

f) Motion for reconsideration of any decision or any order of the Labor Arbiter;

g) Appeal from any interlocutory order of the Labor Arbiter, such as but not limited to, an order:

(1) denying a motion to dismiss; (2) denying a motion to inhibit; (3) denying a motion for issuance of writ of execution; or (4) denying a motion to quash writ of execution.

h) Appeal from the issuance of a certificate of finality of decision by the Labor Arbiter;

i) Appeal from orders issued by the Labor Arbiter in the course of execution proceedings.

i) Such other pleadings, motions and petitions of similar nature intended to circumvent above provisions. (5a, RIII)

SECTION 6. MOTION TO DISMISS. - Before the date set for the mandatory conciliation and mediation conference, the respondent may file a motion to dismiss on grounds provided under Section 5, paragraph (a) hereof. Such motion shall be immediately resolved by the Labor Arbiter through a written order. An order denying the motion to dismiss, or suspending its resolution until the final determination of the case, is not appealable. (6a)

SECTION 7. EFFECT OF FAILURE TO FILE. - No motion to dismiss shall be allowed or entertained after the lapse of the period provided in Section 6 hereof. (n)

SECTION 8. MANDATORY CONCILIATION AND MEDIATION CONFERENCE. - a) The mandatory conciliation and mediation conference shall be called for the purpose of (1) amicably settling the case upon a fair compromise; (2) determining the real parties in interest; (3) determining the necessity of amending the complaint and including all causes of action; (4) defining and simplifying the issues in the case; (5) entering into admissions or stipulations of facts; and (6) threshing out all other preliminary matters. The Labor Arbiter shall personally preside over and take full control of the proceedings and may be assisted by the Labor Arbitration Associate in the conduct thereof.

b) Conciliation and mediation efforts shall be exerted by the Labor Arbiters all throughout the mandatory conferences. Any agreement entered into by the parties whether in partial or full settlement of the dispute shall be reduced into writing and signed by the parties and their counsel or the parties' authorized representatives, if any.

c) In any case, the compromise agreement shall be approved by the Labor Arbiter, if after explaining to the parties, particularly to the complainants, the terms, conditions and consequences thereof, he/she is satisfied that they understand the agreement, that the same was entered into freely and voluntarily by them, and that it is not contrary to law, morals, and public policy.

d) A compromise agreement duly entered into in accordance with this Section shall be final and binding upon the parties and shall have the force and effect of a judgment rendered by the Labor Arbiter.

e) The mandatory conciliation and mediation conference shall, except for justifiable grounds, be terminated within thirty (30) calendar days from the date of the first conference.

f) No motion for postponement shall be entertained except on meritorious grounds and when filed at least three (3) days before the scheduled hearing. (3a)

SECTION 9. EFFECT OF FAILURE OF SETTLEMENT.. - If the parties fail to agree on an amicable settlement, either in whole or in part, during the mandatory conciliation and mediation conference, the Labor Arbiter shall proceed to the other purposes of the said conference as enumerated in Section 8(a) hereof. (4a)

SECTION 10. NON-APPEARANCE OF PARTIES. - The non-appearance of the complainant or petitioner during the two (2) settings for mandatory conciliation and mediation conference scheduled in the summons, despite due notice thereof, shall be a ground for the dismissal of the case without prejudice.

In case of non-appearance by the respondent during the first scheduled conference, the second conference as scheduled in the summons shall proceed. If the respondent still fails to appear at the second conference despite being duly served with summons, he/she shall be considered to have waived his/her right to file position paper. The Labor Arbiter shall immediately terminate the mandatory conciliation and mediation conference and direct the complainant or petitioner to file a verified position paper and submit evidence in support of his/her causes of action and thereupon render his/her decision on the basis of the evidence on record. (5a)

SECTION 11. SUBMISSION OF POSITION PAPER AND REPLY. - a) Subject to Sections 9 and 10 of this Rule, the Labor Arbiter shall direct the parties to submit simultaneously their verified position papers with supporting documents and affidavits, if any, on a date set by him/her within ten (10) calendar days from the date of termination of the mandatory conciliation and mediation conference.

b) No amendment of the complaint or petition shall be allowed after the filing of position papers, unless with leave of the Labor Arbiter.

c) The position papers of the parties shall cover only those claims and causes of action stated in the complaint or amended complaint, accompanied by all supporting documents, including the affidavits of witnesses, which shall take the place of their direct testimony, excluding those that may have been amicably settled.

d) Within ten (10) days from receipt of the position paper of the adverse party, a reply may be filed on a date agreed upon and during a schedule set before the Labor Arbiter. The reply shall not allege and/or prove facts and any cause or causes of action not referred to or included in the original or amended complaint or petition or raised in the position paper. (7a)

SECTION 12. DETERMINATION OF NECESSITY OF HEARING OR CLARIFICATORY CONFERENCE. - Immediately after the submission by the parties of their position paper or reply, as the case may be, the Labor Arbiter shall, motu proprio, determine whether there is a need for a hearing or clarificatory conference. At this stage, he/she may, at his/her discretion and for the purpose of making such determination, ask clarificatory questions to further elicit facts or information, including but not limited to the subpoena of relevant documentary evidence, if any, from any party or witness. (8a)

SECTION 13. ROLE OF THE LABOR ARBITER IN HEARING AND CLARIFICATORY CONFERENCE. - a) The Labor Arbiter shall take full control and personally conduct the hearing or clarificatory conference and may ask questions for the purpose of clarifying points of law or facts involved in the case. The Labor Arbiter may allow the presentation of testimonial evidence with right of cross-examination by the opposing party and shall limit the presentation of evidence to matters relevant to the issue before him/her and necessary for a just and speedy disposition of the case.

b) The Labor Arbiter shall make a written summary of the proceedings, including the substance of the evidence presented, in consultation with the parties. The written summary shall be signed by the parties and shall form part of the records. (9a)

SECTION 14. NON-APPEARANCE OF PARTIES, AND POSTPONEMENT OF HEARINGS AND CLARIFICATORY CONFERENCES.

a) The parties and their counsels appearing before the Labor Arbiter shall be prepared for continuous hearing or clarificatory conference. No postponement or continuance shall be allowed by the Labor Arbiter, except upon meritorious grounds and subject to the requirement of expeditious disposition of cases. The hearing or clarificatory conference shall be terminated within thirty (30) calendar days from the date of the initial clarificatory conference.

b) In case of non-appearance of any of the parties during the hearing or clarificatory conference despite due notice, proceedings shall be conducted ex-parte. Thereafter, the case shall be deemed submitted for decision.

c) Paragraph (a) of this Section notwithstanding, in cases involving overseas Filipino workers, the aggregate period for conducting the mandatory conciliation and mediation conference, including hearing on the merits or clarificatory conference, shall not exceed sixty (60) days, which shall be reckoned from the date of acquisition of jurisdiction by the Labor Arbiter over the person of the respondents. (10a)

SECTION 15. SUBMISSION OF THE CASE FOR DECISION. - Upon the submission by the parties of their position papers or replies, or the lapse of the period to submit the same, the case shall be deemed submitted for decision unless the Labor Arbiter calls for a hearing or clarificatory conference in accordance with Section 12 and 14(a) of this Rule, in which case, notice of hearing or clarificatory conference shall be immediately sent to the parties. Upon termination of the said hearing or conference, the case is deemed submitted for decision. (11a)

SECTION 16. INHIBITION. - A Labor Arbiter may voluntarily inhibit himself/herself from the resolution of a case and shall so state in writing the legal justifications therefor. Upon motion of a party, either on the ground of relationship within the fourth civil degree of consanguinity or affinity with the adverse party or counsel, or on question of partiality or other justifiable grounds, the Labor Arbiter may inhibit himself/herself from further hearing and deciding the case. Such motion shall be resolved within five (5) days from the filing thereof. An order denying or granting a motion for inhibition is inappealable. (12a)

SECTION 17. PERIOD TO DECIDE CASE. - The Labor Arbiter shall render his/her decision within thirty (30) calendar days, without extension, after the submission of the case by the parties for decision, even in the absence of stenographic notes; Provided however, that cases involving overseas Filipino workers shall be decided within ninety (90) calendar days after the filing of the complaint. (13a)

SECTION 18. CONTENTS OF DECISIONS. - The decisions and orders of the Labor Arbiter shall be clear and concise and shall include a brief statement of the: a) facts of the case; b) issues involved; c) applicable laws or rules; d) conclusions and the reasons therefor; and e) specific remedy or relief granted. In cases involving monetary awards, the decisions or orders of the Labor Arbiter shall contain the amount awarded.

In case the decision of the Labor Arbiter includes an order of reinstatement, it shall likewise contain: a) a statement that the reinstatement aspect is immediately executory; and b) a directive for the employer to submit a report of compliance within ten (10) calendar days from receipt of the said decision. (14a)

SECTION 19. FINALITY OF THE DECISION OR ORDER AND ISSUANCE OF CERTIFICATE OF FINALITY.

(a) Finality of the Decision or Order of the Labor Arbiter. - If no appeal is filed with the Commission within the time provided under Article 223 of the Labor Code, as amended, and Section 1, Rule VI of these Rules, the decision or order of the Labor Arbiter shall become final and executory after ten (10) calendar days from receipt thereof by the counsel or authorized representative or the parties if not assisted by counsel or representative.

(b) Certificate of Finality. - Upon expiration of the period provided in paragraph (a) of this Section, the Labor Arbiter shall issue a certificate of finality.

In the absence of return cards, certifications from the post office or courier or other proofs of service to the parties, the Labor Arbiter may issue a certificate of finality after sixty (60) calendar days from date of mailing. (n)

SECTION 20. REVIVAL AND RE-OPENING OR RE-FILING OF DISMISSED CASE and LIFTING OF WAIVER. - A party may file a motion to revive or re-open a case dismissed without prejudice, within ten (10) calendar days from receipt of notice of the order dismissing the same; otherwise, the only remedy shall be to re-file the case. A party declared to have waived his/her right to file position paper may, at any time after notice thereof and before the case is submitted for decision, file a motion under oath to set aside the order of waiver upon proper showing that his/her failure to appear was due to justifiable and meritorious grounds. (16a)

RULE VI APPEALS

SECTION 1. PERIODS OF APPEAL. - Decisions, awards, or orders of the Labor Arbiter shall be final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt thereof; and in case of decisions or resolutions of the Regional Director of the Department of Labor and Employment pursuant to Article 129 of the Labor Code, within five (5) calendar days from receipt thereof. If the 10th or 5th day, as the case may be, falls on a Saturday, Sunday or holiday, the last day to perfect the appeal shall be the first working day following such Saturday, Sunday or holiday.

No motion or request for extension of the period within which to perfect an appeal shall be allowed. (1a)

SECTION 2. GROUNDS. - The appeal may be entertained only on any of the following grounds:

a) If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter or Regional Director;

b) If the decision, award or order was secured through fraud or coercion, including graft and corruption;

c) If made purely on questions of law; and/or

d) If serious errors in the findings of facts are raised which, if not corrected, would cause grave or irreparable damage or injury to the appellant. (2a)

SECTION 3. WHERE FILED. - The appeal shall be filed with the Regional Arbitration Branch or Regional Office where the case was heard and decided.

SECTION 4. REQUISITES FOR PERFECTION OF APPEAL. - a) The appeal shall be:

(1) filed within the reglementary period provided in Section 1 of this Rule; (2) verified by the appellant himself/herself in accordance with Section 4, Rule 7 of the Rules of Court, as amended; (3) in the form of a memorandum of appeal which shall state the grounds relied upon and the arguments in support thereof, the relief prayed for, and with a statement of the date the appellant received the appealed decision, award or order; (4) in three (3) legibly typewritten or printed copies; and (5) accompanied by: i) proof of payment of the required appeal fee and legal research fee; ii) posting of a cash or surety bond as provided in Section 6 of this Rule; and iii) proof of service upon the other parties.

b) A mere notice of appeal without complying with the other requisites aforestated shall not stop the running of the period for perfecting an appeal.

c) The appellee may file with the Regional Arbitration Branch or Regional Office where the appeal was filed, his/her answer or reply to appellant's memorandum of appeal, not later than ten (10) calendar days from receipt thereof. Failure on the part of the appellee who was properly furnished with a copy of the appeal to file his/her answer or reply within the said period may be construed as a waiver on his/her part to file the same.

d) Subject to the provisions of Article 218 of the Labor Code, once the appeal is perfected in accordance with these Rules, the Commission shall limit itself to reviewing and deciding only the specific issues that were elevated on appeal. (4a)

SECTION 5. APPEAL FEE. - The appellant shall pay the prevailing appeal fee and legal research fee to the Regional Arbitration Branch or Regional Office of origin, and the official receipt of such payment shall form part of the records of the case. (5a)

SECTION 6. BOND. - In case the decision of the Labor Arbiter or the Regional Director involves a monetary award, an appeal by the employer may be perfected only upon the posting of a bond, which shall either be in the form of cash deposit or surety bond equivalent in amount to the monetary award, exclusive of damages and attorney's fees. In case of surety bond, the same shall be issued by a reputable bonding company duly accredited by the Commission or the Supreme Court, and shall be accompanied by original or certified true copies of the following:

a) a joint declaration under oath by the employer, his/her counsel, and the bonding company, attesting that the bond posted is genuine, and shall be in effect until final disposition of the case.

b) an indemnity agreement between the employer-appellant and bonding company;

c) proof of security deposit or collateral securing the bond: provided, that a check shall not be considered as an acceptable security;

d) a certificate of authority from the Insurance Commission;

e) certificate of registration from the Securities and Exchange Commission;

f) certificate of accreditation and authority from the Supreme Court; and

g) notarized board resolution or secretary's certificate from the bonding company showing its authorized signatories and their specimen signatures.

The Commission through the Chairman may on justifiable grounds blacklist a bonding company, notwithstanding its accreditation by the Supreme Court.

A cash or surety bond shall be valid and effective from the date of deposit or posting, until the case is finally decided, resolved or terminated, or the award satisfied. This condition shall be deemed incorporated in the terms and conditions of the surety bond, and shall be binding on the appellants and the bonding company.

The appellant shall furnish the appellee with a certified true copy of the said surety bond with all the above-mentioned supporting documents. The appellee shall verify the regularity and genuineness thereof and immediately report any irregularity to the Commission.

Upon verification by the Commission that the bond is irregular or not genuine, the Commission shall cause the immediate dismissal of the appeal, and censure the responsible parties and their counsels, or subject them to reasonable fine or penalty, and the bonding company may be blacklisted.

No motion to reduce bond shall be entertained except on meritorious grounds, and only upon the posting of a bond in a reasonable amount in relation to the monetary award.

The mere filing of a motion to reduce bond without complying with the requisites in the preceding paragraphs shall not stop the running of the period to perfect an appeal. (6a)

SECTION 7. RECORDS OF CASE ON APPEAL. - The records of a case shall have a corresponding index of its contents which shall include the following: a) the original copy of the complaint; b) other pleadings and motions; c) minutes of the proceedings, notices, transcripts of stenographic notes, if any; d) decisions, orders, and resolutions as well as proof of service thereof, if available; e) the computation of the award; f) memorandum of appeal and the reply or answer thereto, if any, and proof of service, if available; g) official receipt of the appeal fee; and h) the appeal bond, if any.

The records shall be chronologically arranged and paged prominently.

SECTION 8. TRANSMITTAL OF RECORDS OF CASE ON APPEAL. - Within forty-eight (48) hours after the filing of the appeal, the records of the case shall be transmitted by the Regional Arbitration Branch or office of origin to the Commission.

SECTION 9. FILING OF APPEAL; EFFECT. - Without prejudice to immediate reinstatement pending appeal under Section 6 of Rule XI, once an appeal is filed, the Labor Arbiter loses jurisdiction over the case. All pleadings and motions pertaining to the appealed case shall thereafter be addressed to and filed with the Commission. (9a)

SECTION 10. FRIVOLOUS OR DILATORY APPEALS. - No appeal from an interlocutory order shall be entertained. To discourage frivolous or dilatory appeals, including those taken from interlocutory orders, the Commission after hearing may censure or cite in contempt the erring parties and their counsels, or subject them to reasonable fine or penalty. (10a)

SECTION 11. APPEALS FROM DECISION OF OTHER AGENCIES. - The Rules provided herein governing appeals from the decisions or orders of Labor Arbiters shall apply to appeals to the Commission from decisions or orders of the other offices or agencies appealable to the Commission according to law.

RULE VII PROCEEDINGS BEFORE THE COMMISSION

SECTION 1. JURISDICTION OF THE COMMISSION. - The Commission shall exercise exclusive, original, and appellate jurisdiction in accordance with law.

SECTION 2. COMPOSITION AND INTERNAL FUNCTIONS OF THE COMMISSION EN BANC AND ITS DIVISIONS. - a) Composition. - Unless otherwise provided by law, the Commission shall be composed of the Chairman and of twenty three (23) Commissioners.

b) Commission En Banc. - The Commission shall sit en banc only for purposes of promulgating rules and regulations governing the hearing and disposition of cases before its Divisions and Regional Arbitration Branches, and for the formulation of policies affecting its administration and operations. It may, on temporary or emergency basis, allow cases within the jurisdiction of any Division to be heard by any other Division whose docket allows the additional workload and such transfer will not expose litigants to unnecessary additional expense.

c) Divisions. - Unless otherwise provided by law, the Commission shall exercise its adjudicatory and all other powers, functions and duties through its eight (8) Divisions. Each Division shall consist of one member from the public sector who shall act as the Presiding Commissioner and one member each from the workers and employers sectors, respectively.

Of the eight (8) Divisions, the First, Second, Third, Fourth, Fifth and Sixth Divisions shall have exclusive territorial jurisdiction over appealed cases coming from Luzon; the Seventh Division, appealed cases from the Visayas Region; and the Eighth Division, appealed cases from Mindanao including those from the Autonomous Region for Muslim Mindanao.

d) Headquarters. - As provided by law, the Commission and its First, Second, Third, Fourth, Fifth and Sixth Divisions for Luzon shall have their main offices in the National Capital Region, and the Seventh and Eighth Divisions for Visayas and Mindanao, in the cities of Cebu and Cagayan de Oro, respectively. (2a)

SECTION 3. THE CHAIRMAN. - The Chairman shall preside over all sessions of the Commission en banc. He/she is the Presiding Commissioner of the First Division. In case of the effective absence or incapacity of the Chairman, the Presiding Commissioner of the Second Division shall be the Acting Chairman.

The Chairman, aided by the Executive Clerk of the Commission, shall have administrative supervision over the Commission and its Regional Arbitration Branches and all its personnel including the Executive Labor Arbiters and Labor Arbiters.

SECTION 4. COMMISSION EN BANC SESSION, QUORUM AND VOTE. - a) Commission En Banc. - The Chairman shall call the Commission to an en banc session at least twice a year, preferably on the first week of June and the first week of December, to deliberate and decide on any matter before it. However, a majority of all the members of the Commission may call a special en banc session to discuss and decide on urgent and vital matters which need immediate action.

b) Quorum. - The presence of a majority of all the members of the Commission shall be necessary to constitute a quorum. The vote or concurrence of the majority of the members constituting a quorum shall be the decision or resolution of the Commission en banc. c) Division. - The presence of at least two (2) Commissioners of a Division shall constitute a quorum. The concurrence of two (2) Commissioners of a Division shall be necessary for the pronouncement of a judgment or resolution.

Whenever the required membership in a Division is not complete and/or the concurrence of two (2) Commissioners cannot be obtained to arrive at a judgment or resolution, the Chairman shall designate such number of additional Commissioners belonging to the same sector from the other Divisions as may be necessary. In the event that all the members of a division inhibit themselves from resolving a case, the Chairman may create a Special Division or assign the case to any of the other Divisions.

d) Role of Chairman in the Division. - The Chairman of the Commission may convene and preside over the session of any Division to consider any case pending before it and participate in its deliberations, if in his/her judgment, his/her presence therein will best serve the interests of labor justice. He/she shall not however, participate in the voting by the Division, except when he/she is acting as Presiding Commissioner of the Division in the absence of the regular Presiding Commissioner. (4a)

SECTION 5. CONSULTATION. - The conclusions of a Division on any case or matter submitted to it for decision shall be reached in consultation before the case is assigned to a member for the writing of the opinion. It shall be mandatory for the Division to meet for the purpose of the consultation ordained herein.

A certification to this effect signed by the Presiding Commissioner of the Division shall be issued and a copy thereof attached to the record of the case and served upon the parties.

SECTION 6. DISSENTING OPINION. - Should any member of a Division indicate his/her intention to write a dissenting opinion, he/she may file the same within the period prescribed for deciding or resolving the appeal; otherwise, such written dissenting opinion shall not be considered part of the records of the case.

SECTION 7. INHIBITION. - No motion to inhibit the entire Division of the Commission shall be entertained. However, any Commissioner may inhibit himself/herself from the consideration and resolution of any case or matter before the Division and shall so state in writing the legal or justifiable grounds therefor. In the event that a member inhibits himself/herself, the case shall be raffled by the Executive Clerk or Deputy Executive Clerk to either of the two (2) remaining Commissioners. In case two (2) Commissioners in a Division inhibit themselves in a case or matter before it, the Chairman shall, as far as practicable, appoint two (2) Commissioners from other Divisions representing the sector of the Commissioners who inhibited themselves.

SECTION 8. ABSTENTION. - In the event of an abstention, and the concurrence of two (2) Commissioners to arrive at a judgment or resolution cannot be obtained, Section 4 (c), second paragraph, of this Rule shall apply.

SECTION 9. CONSOLIDATION OF CASES. - Appealed and injunction cases involving the same parties, issues, or related questions of fact or law shall be consolidated before the Commissioner to whom the case with the lowest case number is assigned. Notice of the consolidation shall be given by the Executive Clerk or Deputy Executive Clerk to the other members of the concerned Divisions.

SECTION 10. TECHNICAL RULES NOT BINDING. - The rules of procedure and evidence prevailing in courts of law and equity shall not be controlling and the Commission shall use every and all reasonable means to ascertain the facts in each case speedily and objectively, without regard to technicalities of law or procedure, all in the interest of due process.

In any proceeding before the Commission, the parties may be represented by legal counsel but it shall be the duty of the Chairman, any Presiding Commissioner or Commissioner to exercise complete control of the proceedings at all stages.

SECTION 11. CONCILIATION AND MEDIATION. - In the exercise of its exclusive, original and appellate jurisdiction, the Commission may exert all efforts towards the amicable settlement of a labor dispute.

The settlement of cases on appeal, to be valid and binding between the parties, shall be approved by the Commission. (11a)

SECTION 12. ROLE OF THE LABOR ARBITER ASSIGNED TO THE COMMISSION. - In the resolution of cases on appeal, and those mentioned in Rules VIII and X, the Commission, in the exigency of the service, shall be assisted by a Labor Arbiter who may be directed to study, review, hear and receive evidence, and submit reports thereon. (12a)

SECTION 13. FORM OF DECISION, RESOLUTION AND ORDER. - The decision, resolution and order of the Commission shall state clearly and distinctly the findings of facts, issues, and conclusions of law on which it is based, and the relief granted, if any. If the decision, resolution or order involves monetary awards, the same shall contain the specific amount awarded as of the date the decision is rendered.

SECTION 14. FINALITY OF DECISION OF THE COMMISSION AND ENTRY OF JUDGMENT. - a) Finality of the Decisions, Resolutions or Orders of the Commission. - Except as provided in Section 9 of Rule X, the decisions, resolutions or orders of the Commission shall become final and executory after ten (10) calendar days from receipt thereof by the counsel or authorized representative or the parties if not assisted by counsel or representative.

b) Entry of Judgment. - Upon the expiration of the ten (10) calendar day period provided in paragraph (a) of this Section, the decision, resolution, or order shall be entered in a book of entries of judgment.

In the absence of return cards, certifications from the post office or the courier or other proofs of service to the parties, the Executive Clerk or Deputy Executive Clerk shall consider the decision, resolution or order as final and executory after sixty (60) calendar days from date of mailing. (14a)

SECTION 15. MOTIONS FOR RECONSIDERATION. - Motion for reconsideration of any decision, resolution or order of the Commission shall not be entertained except when based on palpable or patent errors; provided that the motion is filed within ten (10) calendar days from receipt of decision, resolution or order, with proof of service that a copy of the same has been furnished, within the reglementary period, the adverse party; and provided further, that only one such motion from the same party shall be entertained. (15a)

RULE VIII CERTIFIED CASES

SECTION 1. POLICY. - It is the declared policy of certification of labor disputes for compulsory arbitration to ensure and maintain industrial peace based on social justice and national interest by having a full, complete and immediate settlement or adjudication of all labor disputes between the parties, as well as issues that are relevant to or incidents of the certified issues.

SECTION 2. CERTIFIED LABOR DISPUTES. - Certified labor disputes are cases certified to the Commission for compulsory arbitration under Article 263 (g) of the Labor Code.

SECTION 3. EFFECTS OF CERTIFICATION. - a) Upon certification, the intended or impending strike or lockout is automatically enjoined, notwithstanding the filing of any motion for reconsideration of the certification order nor the non-resolution of any such motion which may have been duly submitted to the Office of the Secretary of Labor and Employment. If a work stoppage has already taken place at the time of the certification, all striking or locked out employees shall immediately return to work and the employer shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lockout.

b) All cases between the same parties, except where the certification order specifies otherwise the issues submitted for arbitration which are already filed or may be filed, and are relevant to or are proper incidents of the certified case, shall be considered subsumed or absorbed by the certified case, and shall be decided by the appropriate Division of the Commission.

Subject to the second paragraph of Section 4 of Rule IV, the parties to a certified case, under pain of contempt, shall inform their counsels and the Division concerned of all cases pending with the Regional Arbitration Branches and the Voluntary Arbitrators relative or incident to the certified case before it.

c) Whenever a certified labor dispute involves a business entity with several workplaces located in different regions, the Division having territorial jurisdiction over the principal office of the company shall acquire jurisdiction to decide such labor dispute; unless the certification order provides otherwise.

SECTION 4. EFFECTS OF DEFIANCE. - Non-compliance with the certification order of the Secretary of Labor and Employment shall be considered as an illegal act committed in the course of the strike or lockout, and shall authorize the Commission to enforce the same under pain of immediate disciplinary action, including dismissal or loss of employment status or payment by the locking-out employer of backwages, damages and/or other affirmative relief, even criminal prosecution against the liable parties.

The Commission may also seek the assistance of law enforcement agencies to ensure compliance and enforcement of its orders and resolutions.

SECTION 5. PROCEDURE IN CERTIFIED CASES. - a) When there is no need to conduct a clarificatory hearing, the Commission shall resolve all certified cases within thirty (30) calendar days from receipt by the assigned Commissioner of the complete records, which shall include the position papers of the parties and the order of the Secretary of Labor and Employment denying the motion for reconsideration of the certification order, if any.

b) Where a clarificatory hearing is needed, the Commission shall, within five (5) calendar days from receipt of the records, issue a notice to be served on the parties through the fastest means available, requiring them to appear and submit additional evidence, if any. All certified cases shall be resolved by the Commission within sixty (60) calendar days from receipt of the complete records by the assigned Commissioner.

c) No motion for extension or postponement shall be entertained. (5a)

SECTION 6. EXECUTION OF JUDGMENT IN CERTIFIED CASE. - Upon issuance of the entry of judgment, the Commission, motu proprio or upon motion by the proper party, may cause the execution of the judgment in the certified case.

RULE IX CONTEMPT

SECTION 1. DIRECT CONTEMPT. - The Chairman or any Commissioner or Labor Arbiter may summarily adjudge guilty of direct contempt any person committing any act of misbehavior in the presence of or so near the Chairman or any Commissioner or Labor Arbiter as to obstruct or interrupt the proceedings before the same, including disrespect toward said officials, offensive acts toward others, or refusal to be sworn or to answer as a witness or to subscribe to an affidavit or deposition when lawfully required to do so. If the offense is committed against the Commission or any member thereof, the same shall be punished by a fine not exceeding Five Hundred Pesos (P500.00) or imprisonment not exceeding five (5) days, or both; and, if the offense is committed against any Labor Arbiter, the same shall be punished by a fine not exceeding One Hundred Pesos (P100.00) or imprisonment not exceeding one (1) day, or both.

Any person adjudged guilty of direct contempt by a Labor Arbiter may, within a period of five (5) calendar days from notice of the judgment, appeal the same to the Commission and the execution of said judgment shall be suspended pending resolution of the appeal upon the filing by said person of a bond on condition that he will abide by and perform the judgment should the appeal be decided against him/her. A judgment of the Commission on direct contempt shall be immediately executory and inappealable.

SECTION 2. INDIRECT CONTEMPT.. - The Commission or any Labor Arbiter pursuant to Article 218 (d) of the Labor Code may cite any person for indirect contempt and impose the appropriate penalty under any of the following grounds:

a) Misbehavior of any officer or employee in the performance of his/her official duties or in his/her official transaction;

b) Disobedience of, or resistance to, a lawful writ, order or decision;

c) Any abuse of, or any unlawful interference with the processes or proceedings not constituting direct contempt;

d) Any improper conduct tending, directly or indirectly, to impede, obstruct or degrade the administration of justice;

e) Assuming to be an attorney or a representative of party without authority;

f) Failure to obey a subpoena duly served; or

g) Other grounds analogous to the foregoing.

A. Where charge to be filed.- Where the charge for indirect contempt has been committed against the Commission or against an Officer appointed by it, the charge may be filed with the Commission. Where such contempt has been committed against the Labor Arbiter, the charge may be filed with the Regional Arbitration Branch subject to appeal to the Commission in the same manner as provided in Section 1 of this Rule.

B. How proceedings commenced.- Proceedings for indirect contempt may be initiated motu proprio by the Commission or any Labor Arbiter by an order or any other formal charge requiring the respondent to show cause why he/she should not be punished for contempt. In all other cases, a charge for indirect contempt shall be commenced by a verified petition with supporting particulars and certified true copies of documents or papers involved therein, and upon full compliance with the requirements for filing initiatory pleadings in the Commission. If the contempt charge arose out of or is related to a principal action pending in the Commission or Regional Arbitration Branch, the petition for contempt shall allege that fact but said petition shall be consolidated, heard, and decided separately, unless the Commission or Labor Arbiter in its/his/her discretion, orders the consolidation of the contempt charge and the principal action for joint hearing and decision.

C. Hearing.- Upon the date set for hearing, the Commission or Labor Arbiter shall proceed to investigate the charge and consider such comment, answer, defense or testimony as the respondent may make or offer. Failure to attend the scheduled hearing and to give a satisfactory explanation in writing to the Commission or Labor Arbiter will result in the waiver of the respondent to be present during the hearing.

D. Punishment for indirect contempt.- If the respondent is adjudged guilty of indirect contempt committed against the Commission or any member thereof, he/she may be punished by a fine of One Thousand (P1,000.00) Pesos per day for every act of indirect contempt; and, if the offense is committed against any Labor Arbiter, the same may be punished by a fine of Five Hundred (P500.00) Pesos per day for every act of indirect contempt. Each day of defiance of, or disobedience to, or non-enforcement of a final order, resolution, decision, ruling, injunction, or processes, shall constitute an indirect contempt of the Commission. If the contempt consists of the violation of an injunction or omission to do an act which is within the power of the respondent to perform, the respondent shall, in addition, be made liable for damages as a consequence thereof. The damages shall be measured by the extent of the loss or injury sustained by the aggrieved party by reason of the acts or omissions of which the contempt is being prosecuted, and the costs of the proceedings, including payment of interest on damages.

E. A writ of execution may be issued to enforce the decision imposing such fine and/or consequent damages as punishment for indirect contempt. (2a)

RULE X INJUNCTION

SECTION 1. INJUNCTION IN ORDINARY LABOR DISPUTES. - A preliminary injunction or restraining order may be granted by the Commission through its Divisions pursuant to the provisions of paragraph (e) of Article 218 of the Labor Code, as amended, when it is established on the basis of the sworn allegations in the petition that the acts complained of involving or arising from any labor dispute before the Commission, which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such party.

A certification of non-forum shopping shall accompany the petition for injunction.

The writ of preliminary injunction or temporary restraining order shall become effective only upon posting of the required cash bond in the amount to be determined by the Commission to answer for any damage that may be suffered by the party enjoined, if it is finally determined that the petitioner is not entitled thereto.

SECTION 2. INJUNCTION IN STRIKES OR LOCKOUTS. - A preliminary or permanent injunction may be granted by the Commission only after hearing the testimony of witnesses and with opportunity for cross-examination in support of the allegations of the complaint or petition made under oath, and testimony by way of opposition thereto, if offered, and only after a finding of fact by the Commission:

a) That prohibited or unlawful acts have been threatened and will be committed and will be continued unless restrained, but no injunction or temporary restraining order shall be issued on account of any threat, prohibited or unlawful act, except against the person or persons, association or organization making the threat or committing the prohibited or unlawful act or actually authorizing or ratifying the same after actual knowledge thereof.

b) That substantial and irreparable injury to petitioner's property will follow;

c) That as to each item of relief to be granted, greater injury will be inflicted upon the petitioner by the denial of relief than will be inflicted upon respondents by the granting of relief;

d) That petitioner has no adequate remedy at law; and

e) That the public officers charged with the duty to protect petitioner's property are unable or unwilling to furnish adequate protection.

SECTION 3. HEARING; NOTICE THEREOF. - Hearings shall be held after due and personal notice thereof has been served, in such manner as the Commission shall direct, to all known persons against whom relief is sought, and also to the Chief Executive and other public officials of the province or city within which the unlawful acts have been threatened or committed charged with the duty to protect petitioner's property.

SECTION 4. RECEPTION OF EVIDENCE; DELEGATION. - The reception of evidence for the application of a writ of injunction may be delegated by the Commission to any of its Labor Arbiters who shall conduct such hearings in such places as he/she may determine to be accessible to the parties and their witnesses, and shall thereafter submit his/her report and recommendation to the Commission within fifteen (15) days from such delegation.

SECTION 5. OCULAR INSPECTION. - The Chairman, any Commissioner, Labor Arbiter or their duly authorized representatives, may, at any time during working hours, conduct an ocular inspection on any establishment, building, ship or vessel, place or premises, including any work, material, implement, machinery, appliance or any object therein, and ask any employee, laborer, or any person, as the case may be, for any information or data concerning any matter or question relative to the object of the petition.

The ocular inspection reports shall be submitted to the appropriate Division within twenty-four (24) hours from the conduct thereof.

SECTION 6. TEMPORARY RESTRAINING ORDER; REQUISITES. - If the petitioner shall also allege that, unless a temporary restraining order shall be issued without notice, a substantial and irreparable injury to petitioner's property will be unavoidable, such a temporary restraining order may be issued upon testimony under oath, or by affidavits of the petitioner's witnesses, sufficient, if sustained, to justify the Commission in the issuance thereof.

SECTION 7. CASH BOND. - No temporary restraining order or writ of preliminary injunction shall be issued except on the condition that petitioner shall first file an undertaking to answer for the damages and post a cash bond in the amount of Fifty Thousand Pesos (P50,000.00), or such higher amount as may be determined by the Commission, to recompense those enjoined for any loss, expense or damage caused by the improvident or erroneous issuance of such order or injunction, including all reasonable costs, together with a reasonable attorney's fee, and expense of defense against the order or against the granting of any injunctive relief sought in the same proceeding and subsequently denied by the Commission.

SECTION 8. EFFECTIVITY OF TEMPORARY RESTRAINING ORDER. - A temporary restraining order shall be effective for no longer than twenty (20) days reckoned from the posting of the cash bond required under the preceding section. During the said period, the parties shall be required to present evidence to substantiate their respective positions in the main petition.

SECTION 9. EFFECTS OF DEFIANCE. - The order or resolution enjoining the performance of illegal acts shall be immediately executory in accordance with the terms thereof. In case of non-compliance, the Commission shall impose such sanctions, and shall issue such orders, as may be necessary to implement the said order or resolution, including the enlistment of law enforcement agencies having jurisdiction over the area for the purpose of enforcing the same.

SECTION 10. ORDINARY REMEDY IN LAW OR IN EQUITY. - Nothing in this Rule shall deprive any party having a claim or cause of action under or upon such undertaking from electing to pursue his/her ordinary remedy by suit at law or in equity.

RULE XI EXECUTION PROCEEDINGS

SECTION 1. EXECUTION UPON FINALITY OF DECISION OR ORDER. - a) A writ of execution may be issued motu proprio or on motion, upon a decision or order that has become final and executory.

b) If an appeal has been duly perfected and finally resolved by the Commission, a motion for execution may be filed before the Labor Arbiter, when the latter has possession of the case records or upon submission of certified true copies of the decisions or final order/s sought to be enforced including notice of decision or order and the entry of judgment, copy furnished the adverse party.

c) Except that, as provided for in Section 18 of Rule V in relation to Section 9 of this Rule, and in those cases where partial execution is allowed by law, the Labor Arbiter shall retain duplicate original copies of the decision to be implemented and proof of service thereof for the purpose of immediate enforcement. (1a)

SECTION 2. EXECUTION BY MOTION OR BY INDEPENDENT ACTION.. - Pursuant to Art. 224 of the Labor Code, a decision or order may be executed on motion within five (5) years from the date it becomes final and executory. After the lapse of such period, the judgment shall become dormant, and may only be enforced by an independent action before the Regional Arbitration Branch of origin and within a period of ten (10) years from date of its finality. (8a)

SECTION 3. EFFECT OF PERFECTION OF APPEAL ON EXECUTION. - The perfection of an appeal shall stay the execution of the decision of the Labor Arbiter except execution for reinstatement pending appeal. (9a)

SECTION 4. EFFECT OF PETITION FOR CERTIORARI ON EXECUTION. - A petition for certiorari with the Court of Appeals or the Supreme Court shall not stay the execution of the assailed decision unless a restraining order is issued by said courts. (10a)

SECTION 5. PRE-EXECUTION CONFERENCE. - Within two (2) working days from receipt of a motion for the issuance of a writ of execution which shall be accompanied by a computation of a judgment award, if necessary, the Commission or the Labor Arbiter may schedule a pre-execution conference to thresh out matters relevant to execution including the final computation of monetary award. The pre- execution conference shall not exceed fifteen (15) calendar days from the initial schedule, unless the parties agreed to an extension.

Any order issued by the Labor Arbiter in the pre-execution conference is not appealable, subject to the remedies available under Rule XII. (2a)

SECTION 6. ISSUANCE, CONTENTS AND EFFECTIVITY OF A WRIT OF EXECUTION. - The writ of execution shall issue in the name of the Republic of the Philippines signed by the Commission or Labor Arbiter ordering the Sheriff to execute the decision, order, or award of the Commission or Labor Arbiter, and must contain the complete name of the party, whether natural or juridical, against whom the writ of execution was issued, the dispositive portion thereof, the amount, if any, to be demanded, and all legal fees to be collected from the losing party or any other person required by law to obey the same.

A writ of execution shall be effective for a period of five (5) years from issuance thereof. In case of partial satisfaction of judgment during the lifetime of the writ, the Labor Arbiter shall motu proprio issue an updated writ reflecting the amount collected and the remaining balance. (3a)

SECTION 7. ENFORCEMENT OF WRIT OF EXECUTION. - In executing a decision, resolution or order, the Sheriff, or other authorized officer acting as Sheriff of the Commission, shall serve the writ within three (3) days from receipt of the same, subject to the requirements of Sections 12 and 13 of this Rule and shall be guided strictly by these Rules and by the Manual on Execution of Judgment, which shall form part of these Rules. In the absence of applicable rules, the Rules of Court, as amended, shall be applied in a suppletory manner. (7a)

SECTION 8. MANNER OF EXECUTION OF MONETARY JUDGMENT. - a) Immediate payment on demand. - The Sheriff shall enforce a monetary judgment by demanding the immediate payment of the full amount stated in the writ of execution and all legal fees from the losing party or any other person required by law to obey the same.

b) In the event of failure or refusal of the losing party to pay the judgment award, the Sheriff shall immediately proceed against the cash deposit or surety bond posted by the losing party, if any;

c) If the bonding company refuses to pay or the bank holding the cash deposit of the losing party refuses to release the garnished amount despite the order or pertinent processes issued by the Labor Arbiter or the Commission, the president or the responsible officers or authorized representatives of the said bonding company or the bank who resisted or caused the non-compliance shall be either cited for contempt, or held liable for resistance and disobedience to a person in authority or the agents of such person as provided under the pertinent provision of the Revised Penal Code. This rule shall likewise apply to any person or party who unlawfully resists or refuses to comply with the break open order issued by the Labor Arbiter or the Commission.

For this purpose, the Labor Arbiter or the Commission may issue an order directing the sheriff to request the assistance of law enforcement agencies to ensure compliance with the writ of execution, orders or processes.

A bonding company cited for contempt, or for an offense defined and punishable under the pertinent provision of the Revised Penal Code shall be barred from transacting business with the Commission.

d) Should the cash deposit or surety bond be insufficient, or in case the surety bond cannot be proceeded against for any reason, the Sheriff shall, within five (5) days from demand, execute the monetary judgment by garnishing bank deposits, credits, receivables, and other personal property not capable of manual delivery, if the same is not enough, proceed to levy the personal property of the losing party, and if still insufficient, against the real property not exempt from execution, sufficient to cover the judgment award, which may be disposed of for value at a public auction to the highest bidder.

e) Proceeds of execution shall be deposited with the Cashier of the concerned Division or Regional Arbitration Branch, or with an authorized depositary bank. Where payment is made in the form of a check, the same shall be payable to the Commission.

f) For monetary judgment on cases involving overseas Filipino workers, the manner of execution shall be in accordance with Republic Act No. 10022. (5a)

SECTION 9. EXECUTION OF REINSTATEMENT PENDING APPEAL. - In case the decision includes an order of reinstatement, and the employer disobeys the directive under the second paragraph of Section 18 of Rule V or refuses to reinstate the dismissed employee, the Labor Arbiter shall immediately issue writ of execution, even pending appeal, directing the employer to immediately reinstate the dismissed employee either physically or in the payroll, and to pay the accrued salaries as a consequence of such non-reinstatement in the amount specified in the decision.

The Sheriff shall serve the writ of execution upon the employer or any other person required by law to obey the same. If he/she disobeys the writ, such employer or person may be cited for contempt in accordance with Rule IX. (6a)

SECTION 10. RESOLUTION OF MOTION TO QUASH.. - A motion to quash shall be resolved by the Labor Arbiter within ten (10) working days from submission of said motion for resolution. The mere filing of a motion to quash shall not stay execution proceedings. (11a)

SECTION 11. THIRD PARTY CLAIM.. - a) If the property levied is claimed by any person other than the losing party, such person may file a third party claim not later than five (5) days from the last day of posting or publication of the notice of execution sale, otherwise the claim shall be forever barred. Such third party claim must comply with the following requirements:

(1) An affidavit stating title to property or right to the possession thereof with supporting evidence;

(2) Posting of a bond equivalent to the amount of the claim or judgment award, whichever is lower; and

(3) Payment of prevailing filing fee.

b) Where filed - The third party claim shall be filed with the Commission or Labor Arbiter where the execution proceeding is pending, with proof of service of copies thereof to the Sheriff and the prevailing party.

c) Effect of Filing. - The filing of a third party claim that has complied with the requirements set forth under paragraph (a) of this Section shall automatically suspend the proceedings with respect to the execution of the properties subject of the third party claim.

Upon approval of the bond, the Labor Arbiter shall issue an order releasing the levied property or a part thereof subject of the claim unless the prevailing party posts a counter bond in an amount not less than the value of the levied property.

The Labor Arbiter may require the posting of additional bond upon showing by the other party that the bond is insufficient.

d) Proceedings. - The propriety of the third party claim shall be resolved within ten (10) working days from submission of the claim for resolution. The decision of the Labor Arbiter is not appealable but may be elevated to the Commission and resolved in accordance with Rule XII hereof. Pending resolution thereof, execution shall proceed against all other properties not subject of the third party claim. (12a)

SECTION 12. SHERIFF'S RETURN AND REPORT.. - The writ of execution shall be returned to the Commission or Labor Arbiter immediately after the full satisfaction of the judgment award. In case of partial or non-satisfaction of the judgment, the sheriff enforcing the writ shall submit a report updating the Commission or Labor Arbiter who issued the writ of execution on the status of the enforcement thereof, not later than thirty (30) days from receipt of such writ and every thirty (30) days thereafter during the lifetime of the writ unless fully satisfied. A copy of the report shall be furnished the Chairman and the Executive Labor Arbiter.

Failure on the part of the Sheriff to submit the report or return required under Section 12 of this Rule within the stated period shall subject him/her to administrative fine under Rule XIV of this Rule, or suspension for fifteen (15) days without pay, or both. (13a, 14a)

SECTION 13. DESIGNATION OF SPECIAL SHERIFFS - The Chairman of the Commission may designate special Sheriffs and take any measure, under existing laws, to ensure compliance with the decisions, resolutions or orders of the Commission and those of Labor Arbiters. (15a)

SECTION 14. EFFECT OF REVERSAL OF EXECUTED JUDGMENT.. - Where the executed judgment is totally or partially reversed or annulled by the Court of Appeals or the Supreme Court, the Labor Arbiter shall, on motion, issue such orders of restitution of the executed award, except wages paid during reinstatement pending appeal.

RULE XII EXTRAORDINARY REMEDIES (n)

SECTION 1. VERIFIED PETITION.. - A party aggrieved by any order or resolution of the Labor Arbiter including those issued during execution proceedings may file a verified petition to annul or modify such order or resolution. The petition may be accompanied by an application for the issuance of a temporary restraining order and/or writ of preliminary or permanent injunction to enjoin the Labor Arbiter, or any person acting under his/her authority, to desist from enforcing said resolution or order.

SECTION 2. GROUNDS. - The petition filed under this Rule may be entertained only on any of the following grounds:

a) If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter.

b) If serious errors in the findings of facts are raised which, if not corrected, would cause grave or irreparable damage or injury to the petitioner.

c) If a party by fraud, accident, mistake or excusable negligence has been prevented from taking an appeal;

d) If made purely on questions of law; or

e) If the order or resolution will cause injustice if not rectified.

SECTION 3. WHEN AND WHERE FILED.. - Not later than ten (10) calendar days from receipt of the order or resolution of the Labor Arbiter, the aggrieved party may file a petition with the Commission furnishing a copy thereof to the adverse party.

SECTION 4. REQUISITES OF THE PETITION.. - The petition filed under this Rule shall: a) be accompanied by a clear original or certified true copy of the order or resolution assailed, together with clear copies of documents relevant or related to the said order or resolution for the proper understanding of the issue/s involved; b) contain the arbitral docket number and appeal docket number, if any; c) state the material date showing the timeliness of the petition; d) be verified by the petitioner himself/herself in accordance with Section 4, Rule 7 of the Rules of Court, as amended; e) be in the form of a memorandum which shall state the ground/s relied upon, the argument/s in support thereof and the reliefs prayed for; f) be in three (3) legibly written or printed copies; and g) be accompanied by: i) certificate of non-forum shopping; ii) proof of service upon the other party/ies and the Labor Arbiter who issued the order or resolution being assailed or questioned; and iii) proof of payment of the required fees.

SECTION 5. THE PUBLIC AND PRIVATE RESPONDENTS IMPLEADED IN THE PETITION. - The Labor Arbiter shall be jointly impleaded with the private respondent as a public respondent in a nominal capacity. As used in this Rule, the private respondent refers to the party interested in sustaining the order or resolution of the Labor Arbiter. It shall be the duty of the private respondent to appear and defend, both in his/her behalf and that of the public respondent, and the cost awarded in such proceedings in favor of the petitioner shall be against the private respondent only. The public respondent shall not appear or file an answer or comment to the petition or any pleading therein.

SECTION 6. SERVICE AND FILING OF PLEADINGS.. - The party filing the pleadings shall serve the other party with copies thereof in accordance with Rule 13 of the Rules of Court furnishing the Labor Arbiter with a copy.

If the last day to serve and file a pleading falls on a Saturday, Sunday or holiday, the pleading shall be served and filed on the first working day immediately following such Saturday, Sunday or Holiday.

SECTION 7. ANSWER TO THE PETITION.. - Within ten(10) calendar days from the receipt of the petition, the private respondent shall file his/her answer therein stating the ground/s why the petition should be denied. Failure on the part of the private respondent, to file his/her answer within the said period may be construed as a waiver to file the same.

SECTION 8. OPPOSITION TO THE INJUNCTIVE RELIEF; WHEN FILED.. - In case the petitioner also prays for an injunctive relief, the private respondent may file his/her verified opposition or comment to the application for injunctive relief not later than five (5) calendar days from receipt of a copy of the petition.

SECTION 9. EFFECT OF FILING OF PETITION.. - Upon filing of the petition, the proceedings before the Labor Arbiter shall continue unless restrained. In case of execution, the proceedings in accordance with Rule XI of these Rules shall not be suspended, but no money collected or credit garnished may be released or properties levied upon be sold by public auction within fifteen (15) calendar days from the filing of the petition. If no temporary restraining order or writ of preliminary injunction is issued within the said period, the money collected or credit garnished shall be released and/or the properties levied upon sold by public auction and the proceeds of the sale applied, to satisfy the judgment.

In case of execution proceedings, the Labor Arbiter shall immediately inform in writing the Commission or the Division where the petition is pending of the satisfaction of the judgment, and, if circumstances warrant, the Commission shall dismiss the petition for being moot.

The records of the case shall not be elevated to the Commission unless otherwise ordered.

SECTION 10. VERIFIED APPLICATION, ISSUANCE OF TEMPORARY RESTRAINING ORDER OR PRELIMINARY INJUNCTION; BOND:. - Upon the filing of a verified application for injunctive relief, together with supporting affidavits and documents, the Commission may issue a writ of a preliminary injunction based on any of the applicable grounds provided for in Section 3, Rule 58 of the Rules of Court for the preservation of the rights of the parties pending resolution of the petition. The writ of preliminary injunction shall be effective for a non-extendible period of sixty (60) calendar days from service on the private respondent.

If it shall appear from facts shown by the verified application and affidavits that great and irreparable damage and/or injury would result to the petitioner before the petition can be resolved, the Commission may issue a temporary restraining order ex- parte effective for a non-extendible period of twenty (20) calendar days from service on the private respondent.

In the issuance of a temporary restraining order or writ of preliminary injunction, the Commission shall require the posting of a cash bond in the amount of Fifty Thousand Pesos (P50,000.00), or such higher amount as may be determined by the Commission, to recompense those enjoined for any loss, expense or damage caused by the improvident or erroneous issuance of such order or injunction, including all reasonable costs.

An additional cash bond may be required by the Commission in the issuance of a writ of preliminary injunction.

SECTION 11. EFFECTIVITY OF TEMPORARY RESTRAINING ORDER OR WRIT OF PRELIMINARY INJUNCTION. The temporary restraining order or writ of preliminary injunction shall become effective only upon posting of the required cash bond.

In the event that the application for a writ of preliminary injunction is denied or not resolved within the said period, the temporary restraining order is deemed automatically vacated.

The application for a temporary restraining order or a writ of preliminary injunction may be denied, or if granted, may be dissolved, on any grounds provided for in Section 6, Rule 58 of the Rules of Court.

SECTION 12. EFFECT OF INJUNCTION.. - The issuance of a temporary restraining order or a writ of preliminary injunction, unless otherwise declared by the Commission, shall not suspend the proceedings before the Labor Arbiter or stay the implementation of the writ of execution but shall only restrain or enjoin such particular act/s as therein decreed to be restrained or enjoined.

SECTION 13. RESOLUTION OF PETITION.. - If the Commission finds that the allegations of the petition are true, it shall: a) render judgment for the relief prayed for or to which the petitioner is entitled, and/or b) grant a final injunction perpetually enjoining the Labor Arbiter or any person acting under his/her authority from the commission of the act/s or confirming the preliminary injunction. However, the Commission may dismiss the petition if it finds the same to be patently without merit, prosecuted manifestly for delay, or that the questions raised therein are too unsubstantial to require consideration.

SECTION 14. RECOVERY FROM THE INJUNCTION BOND.. - The amount of damages that may be recovered by the private respondent from the injunction bond of the petitioner shall be ascertained and awarded in the decision/order/resolution finally disposing of the issue on the application for injunction.

SECTION 15. NO APPEAL FROM THE ORDER OR RESOLUTION OF THE LABOR ARBITER ARISING FROM EXECUTION PROCEEDINGS OR OTHER INCIDENTS.. - Except by way of a petition filed in accordance with this Rule, no appeal from the order or resolution issued by the Labor Arbiter during the execution proceedings or in relation to incidents other than a decision or disposition of the case on the merits, shall be allowed or acted upon by the Commission.

RULE XIII COMMISSION SEAL AND RECORDS, AND POWERS AND DUTIES OF COMMISSION OFFICIALS

SECTION 1. SEAL OF THE COMMISSION. - The seal of the National Labor Relations Commission shall be of standard size, circular, with the inscription, running from left to right on the upper outside edge, the words "NATIONAL LABOR RELATIONS COMMISSION", and the lower outside edge, the words "REPUBLIC OF THE PHILIPPINES", with a design at the center containing the coat of arms of the Department of Labor and Employment.

SECTION 2. THE EXECUTIVE CLERK. - The Executive Clerk shall assist the Commission when sitting en banc and when acting through the First Division, and shall perform such similar or equivalent functions and duties as are discharged by the Clerk of Court of the Court of Appeals.

SECTION 3. DEPUTY EXECUTIVE CLERKS. - The Deputy Executive Clerks of the other Divisions shall assist the Commission when acting through its Division, and shall perform similar functions and duties as discharged by the Deputy Clerks of Court of the Court of Appeals, and as enumerated herein as functions of the Executive Clerk relative to their respective Divisions. (3a)

SECTION 4. DUTIES AND FUNCTIONS OF THE EXECUTIVE CLERK AND DEPUTY EXECUTIVE CLERKS. - a) Custody of Seal and Books.. - He/she shall keep in his/her care and custody the Seal of the Commission, together with all the books necessary for the recording of the proceedings of the Commission, including the records, files and exhibits;

b) Filing of Pleadings.. - He/she shall receive and file all cases and pleadings and documents indicating thereon the date and time filed. All pleadings shall be filed in three (3) legibly typewritten copies in legal size; c) Raffle and Assignment of Cases.. - He/she shall assign appealed cases for study or report strictly by raffle or as directed by the Chairman. In this connection, the raffle of cases for study or report must be attended by the duly designated representative of the Members of the appropriate Division;

d) Service of Processes, Orders and Decisions.. - He/she shall serve parties and counsel processes, notices of hearings, copies of decisions, resolutions or orders issued by the Commission by registered mail, by courier or by personal service and immediately attach the returns or proofs of delivery thereof to the records;

e) Commission Calendar and Minutes Book.. - He/she shall prepare the Commission or Division calendars of sessions, attend such sessions personally and immediately prepare the minutes thereof. For this purpose, he/she shall keep a minutes book;

f) General Docket. - The Executive Clerk shall keep a general docket for the Commission, each page of which shall be numbered and prepared for receiving all the entries in a single page, and shall enter therein all original and appealed cases before it, numbered consecutively in the order in which they were received and, under the heading of each case, the date and hour of each pleading filed, of each order, decision or resolution entered, and of each other step or action taken in the case; so that, by reference to any single page, the history of the case may be known;

g) Promulgation and Promulgation Book.. - He/she shall promulgate decisions and final resolutions on the same date the same is filed with his/her office and indicate the date and time of promulgation and attest the same by his/her signature on the first page thereof. He/she shall immediately furnish the Chairman with a copy of such decision, resolution, or order with a summary of the nature thereof and the issue involved therein. He/she shall keep a promulgation book which indicates the date and time of promulgation, the case number, title of the case, the ponente, the nature of the decision or final resolution and the action taken by the Commission by quoting the dispositive portion thereof. Notices of said decisions, resolutions or orders shall be sent in sealed envelopes to parties and their counsel within forty-eight (48) hours from promulgation;

h) Entry of Judgment. - He shall keep a book of entries of judgment, decisions, resolutions and orders containing in chronological order the entries of all final decisions, resolutions and orders of the Commission;

i) Disposition and Remand of Records. - Upon entry of judgment, he/she shall immediately remand the records of the case to the Regional Arbitration Branch of origin, Regional Director or his/her duly authorized officer, as the case may be. The Records Unit shall immediately post said records without delay within two (2) working days;

j) Monthly Accomplishment Reports.. - He/she shall submit a monthly accomplishment report of the Commission or Division not later than the 7th day of the following month;

k) Other Functions.. - He/she shall perform other functions as directed by the Chairman or the Commission en banc. (4a)

SECTION 5. BOARD SECRETARIES. - The Board Secretaries of the Commission shall assist the Executive Clerk or Deputy Executive Clerks in the performance of their duties and functions relative to the Commission or their respective Divisions.

SECTION 6. ISSUANCE OF CERTIFIED COPIES. - Unless otherwise restricted by Section 8 hereof, the Executive Clerk, Deputy Executive Clerks, and the authorized officers of the Regional Arbitration Branches shall prepare, for any person asking for the same, a certified copy, under the Seal of the Commission, of any paper, record, decision, resolution, order or entry by and in his/her office, proper to be certified, after payment of the standard fees to the Commission duly receipted for; Provided, that a pauper litigant, as defined by law, shall be exempted from paying any fee for certified copies of any document, including transcripts of stenographic notes.

SECTION 7. POWER TO ADMINISTER OATH. - The Chairman, Members of the Commission, the Executive Clerk, the Deputy Executive Clerks, the Executive Labor Arbiters, the Labor Arbiters, and other persons designated or commissioned by the Chairman of the Commission, shall have the power to administer oath on all matters or proceedings related to the performance of their duties.

SECTION 8. ACCESS TO COMMISSION RECORDS. - All official records of the Commission shall be open to the public during regular office hours, except those kept by it in the nature of confidential reports, records or communications which cannot be divulged without violating private rights or prejudicing the public interest. Minutes of hearings or sessions may not be divulged until after promulgation of the decision or resolution.

RULE XIV ADMINISTRATIVE SANCTIONS

Section 1. IMPOSITION OF FINES. The Commission and Labor Arbiters, by authority of the Chairman, may after hearing, impose administrative fines which shall not be less than Five Hundred Pesos (P500.00) nor more than Ten Thousand Pesos (P10,000.00) to ensure compliance with decisions, orders or awards.

The imposition thereof may be enforced through issuance of a writ of execution. (n)

RULE XV EFFECTIVITY

SECTION 1. EFFECTIVITY. - These Rules shall take effect fifteen (15) days after publication in two (2) newspapers of general circulation.

Signed this 31st day of May 2011 at Davao City, Philippines.

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