Letter to an Attorney

Dear Attorney,

Good afternoon. I hope this message finds you well. I would like to seek your legal advice on a concern regarding our company’s practices. Despite some employees having been employed for an extended period, they are not granted regular status. Additionally, the company has recently withdrawn certain benefits previously provided.

We are uncertain about the legality of these actions and the appropriate steps we should take as employees to address this issue. Could you kindly shed light on the legal implications and possible remedies under Philippine labor laws?

Your guidance will be greatly appreciated. Thank you very much.

Sincerely,
A Concerned Employee

Legal Article: Employment Regularization and Benefits in the Philippines

In the Philippines, labor laws provide strong protections for employees, ensuring fair treatment and security of tenure. The issues of employment regularization and benefits are among the most commonly raised concerns by workers. This article comprehensively examines these issues, delving into the legal framework, the obligations of employers, and the remedies available to employees.

I. Employment Regularization: The Legal Framework

1. Security of Tenure Under the Constitution
The 1987 Philippine Constitution guarantees workers’ security of tenure. This principle is also reflected in the Labor Code of the Philippines, which aims to protect employees from arbitrary termination.

2. Types of Employment Under the Labor Code
Employment in the Philippines can generally be classified as follows:

Regular Employment: Characterized by tasks that are necessary or desirable in the usual business or trade of the employer.
Probationary Employment: Limited to a maximum of six months, during which an employee undergoes evaluation.
Fixed-Term Employment: Restricted by a pre-agreed term or duration.

3. Automatic Regularization
Under Article 296 of the Labor Code (formerly Article 281), an employee who has rendered at least six months of continuous service is deemed a regular employee, unless the work is seasonal, project-based, or covered by other special arrangements. The employer’s failure to regularize employees performing tasks integral to its business constitutes a violation of labor laws.

II. Prohibition Against Non-Regularization

1. Legal Consequences for Non-Regularization
An employer’s refusal to regularize employees who qualify as regular workers may expose the company to several legal consequences:

Constructive Dismissal Claims: If employees are repeatedly terminated and rehired to avoid regularization, they may file complaints for constructive dismissal.
Labor Disputes: Employees can lodge complaints before the Department of Labor and Employment (DOLE) or the National Labor Relations Commission (NLRC).
Administrative Penalties: DOLE can impose fines or other administrative sanctions.

2. Exceptions
Certain forms of employment, such as project-based or seasonal work, do not require regularization. Employers must prove the nature of the employment arrangement to avoid liabilities.

III. Employee Benefits: Legal Standards

1. Mandatory Benefits Under Philippine Labor Laws
Employers are required to provide several mandatory benefits to their employees, including:

13th Month Pay: Guaranteed under Presidential Decree No. 851.
Service Incentive Leave: Five days of leave for employees who have worked for at least one year.
Retirement Benefits: For employees meeting the conditions under Republic Act No. 7641.
SSS, PhilHealth, and Pag-IBIG Contributions: Employers must remit mandatory contributions to these government agencies.

2. Withdrawal of Benefits
Unilateral withdrawal of benefits, particularly those explicitly required by law, constitutes a violation. Even non-statutory benefits (e.g., bonuses, allowances) may not be arbitrarily removed if they have become part of the employee’s compensation package over time (principle of "diminution of benefits").

IV. Addressing Violations: Employee Remedies

1. Filing a Complaint with DOLE
Employees can file complaints with the DOLE for labor standards violations. The DOLE investigates and can impose corrective actions.

2. Filing a Case with the NLRC
For security of tenure issues or illegal dismissal, employees may file a case with the NLRC. If successful, employees may be entitled to reinstatement and payment of back wages.

3. Collective Bargaining and Unionization
Employees may consider forming or joining a union to collectively address grievances with the employer.

V. Legal Jurisprudence on Non-Regularization and Benefits

1. Supreme Court Rulings
Several landmark cases have clarified issues related to employment regularization and benefits:

G.R. No. 179652 (Valenzuela v. NLRC): Emphasized that tasks necessary and desirable in an employer’s business make an employee eligible for regularization.
G.R. No. 190994 (Diwa v. Quasha): Declared the principle of diminution of benefits as illegal, reinforcing that benefits granted over time cannot be withdrawn arbitrarily.

2. Recent Developments
Recent rulings and administrative orders continue to strengthen protections for employees, particularly in areas where employers attempt to exploit legal ambiguities.

VI. Employer Obligations and Best Practices

Employers should proactively comply with labor laws to avoid disputes and foster a positive workplace. This includes:

Regularizing Eligible Employees: Timely granting of regular status to avoid penalties.
Providing Mandated Benefits: Ensuring compliance with statutory requirements and honoring agreements.
Documenting Employment Arrangements: Maintaining clear records to substantiate employment terms.

VII. Conclusion and Recommendations

The refusal to regularize employees and the withdrawal of benefits are serious violations of Philippine labor laws. Employees facing such issues are advised to:

Document Incidents: Gather evidence, such as employment contracts and pay slips.
Seek Legal Counsel: Consult with a labor lawyer to explore options.
Engage with DOLE or NLRC: File appropriate complaints to assert their rights.

Employers, on the other hand, must be aware that compliance with labor laws not only avoids liabilities but also strengthens organizational integrity and employee trust. Proper adherence to employment standards is essential in maintaining harmonious labor relations and fostering economic productivity.

For further guidance, employees are encouraged to seek legal advice tailored to their specific circumstances.