The basic nationalistic policy on labor is articulated as follows:

The State shall promote the preferential use of Filipino labor, domestic materials and locally produced goods, and adopt measures that help make competitive.: ( Art Xlii, Sec. 12).
Consistent with this declared policy, the Constitution nationalizes new fields of endeavor. Thus: The practice of all professions in the Philippines shall be limited to Filipino citizens, save in cases prescribed by law” (Art. XII, Sec.14). Educational institutions, other than those established by religious groups and mission boards, shall be owned solely by citizens of the Philippines or corporations or associations at least sixty per centum of the capital of which is owned by such citizens. The Congress may, however, require increased Filipino equity participation in all educational institutions.

The control and administration of educational institutions shall be vested in citizens of the Philippines . . (Art. XJV, Sec.4 (2))

* The ownership and management of mass media shall be limited to citizens of the Philippines, or to corporations, cooperatives or associations wholly-owned and managed by such citizens. Only Filipino citizens or corporations or associations at least seventy per centum of the capital of which is owned by such citizens shall be allowed to engage in the advertising industry. . .“ (Art. XVI, Sec.II [2])

CHAPTER III STATUTORY LABOR POLICIES BOOK I PRE-EMPLOYMENT

1. THE LABOR CODE: AN OVERVIEW. The Labor Code of the Philippines was enacted into law by Presidential Decree No. 442, which was approved on May 1,1974 and took effect six months later, on November 1, 1974, except its provisions on the employees’ compensation program which became applicable to contingencies occurring on or after January 1, 1975.

The Code comprises a Preliminary Title and Seven Books. Aside from the Preliminary Title which serves as preface, and Book VII which sets rules on prescriptions, transitory and final provisions, its substantive I labor laws are distributed as follows:

Book I -- Pre-Employment and Book II -- Human Resources Development Program: Labor Policies; Book III -- Conditions of Employment, Book IV, Title One -- Medical, Dental and Occupational Safety and Book VI--Post Employment: Labor Standards laws; Book IV-- Title 11-Employees’ Compensation and State Insurance Fund, Title 111 -- Medicare, and Title IV - Adult Education: Social laws, and Book V -- Labor Relations: Labor Relations Law.

2. THE DISTINCTIVE FEATURE OF THE CODE. The Labor Code of the Philippines is distinguished from other labor codes and laws in that it is oriented toward national development, partaking of the character a developmental law. Hence, it does not merely regulate an essentially contractual type of employer-employee relationship, but is also a tool of national development in its provisions to promote employment, develop human resources, provide a national manpower plan, and similar measures. This unique character of the Code is particularly evident in its Books I and II. According to the Secretary of Labor, the Code can be summarily described one sentence: It represents the updating of all labor laws to make them more responsive to the priorities of development and employment, as well as social justice.

3. THE BASIC APPROACH: TRIPARTISM. TRIPARTISM is the participation and cooperation among government, labor and management in the evolvement and formulation of labor policies and standards. The Labor Code itself is a product of TRIPARTISM, and this mode toward a consensus among the parties directly concerned is evident in its policies and provisions. This approach has been accorded a broader application as it has been given the status of a State policy. Toward this end, workers and employers shall, as far as practicable, be represented in decision and policy-making bodies of the government (Sec. 32-a R.A. 6715). Similarly, the Secretary of Labor and Employment, or his duly authorized representatives, may from time to time call a national, regional, or industrial tripartite conference of representatives of government, workers and employers for the consideration and adoption of voluntary codes of principles designed to promote industrial peace based on social justice or to align labor movement i1ations with established priorities in economic and social development (Art.275, Labor Code as amended by R.A. 6715) TRIPARTISM is also evident in some provisions of the Code, as in industry boards, apprenticeship programs, compulsory arbitration proceedings, and others.

4. PROMOTING FULL EMPLOYMENT. This objective which informs both Books I and II of the Labor Code is aimed at implementing the Constitutional mandate to ‘promote full employment.” (Art. XIII, Sec. Normally, this is not a germane topic for a labor law or code as there is no employer-employee relationship to speak of. Its treatment as a matter of concern in the first two books of the Labor Code illustrates the developmental character of this Code. This objective is sought to be attained principally through improved manpower training, allocation and utilization (Art. 12 LC). Manpower training is treated in Book II, while manpower allocation and utilization are promoted by provisions in Book I which, inter alia:

a) Empower the Secretary of Labor to establish new employment offices ,and develop programs that will facilitate occupational ,industrial and geographical mobility of labor, and provide assistance in the relocation of workers; (Art. I4LQ b) Task the Bureau of Local Employment to develop plans and programs to implement employment promotion objectives; (Alt 15 LC) c) Regulate the recruitment and placement of workers, both domestic and overseas. (Art 25 and if) Book I also contains a Title that regulates employment of non-resident aliens.

5. RECRUITMENT AND PLACEMENT OF WORKERS. The original policy in this regard was to phase out within a 4-year period from the effectively of the Code all private, fee-charging employment agencies This policy was prompted by a two-fold purpose: a) to eliminate malpractices that had characterized the resentment and placement business, thus enabling government to have firmer control of the labor mai*et; and b) to reach the same end prescribed by ILO Convention No. 96, to which the Philippines is a signatory. This policy was replaced by a new one introduced by PD 1412 which allowed private sector participation in this activity, subject to the control and supervision of government. This was brought about by the price spiral of crude oil in the mid-fifties, which was followed by an industrialization drive by Mid-East countries resulting in a heavy demand for relatively inexpensive but skilled Filipino labor for overseas employment. The Labor Code defines “recruitment and placement” as “any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not. Provided, that any person or entity which in any manner, offers or promises for a fee employment to two or more persons, shall be deemed engaged in recruitment and placement”. (Art. 13-b, LC; People vs. Turda, 233 SCRA 702) The proviso regarding number of persons in the above definition is not to be interpreted strictly. According to the Supreme Court, this was intended neither to impose a condition on a basic rule nor to provide an exception thereto, but merely to create a presumption. . . The words “shall be deemed” create that presumption, (People vs. Panis, 142 SCRA 664)

6. GOVERNMENT AGENCIES REGULATING RECRUITMENT ACTIVITIES. The Philippine Overseas Employment Administration (POEA) is the present government entity tasked with promoting the overseas employment of Filipino workers, securing the best employment terms and conditions therefore, ensuring their compliance therewith and recruiting and placing overseas workers on a government- to-government arrangement. The recruitment of domestic workers is under the supervision of the Bureau of Local Employment (BLE) of the Department of Labor and Employment (DOLE), which also absorbed the functions of the defunct Bureau of Apprenticeship. These two offices were created by Exec. Order No.797, May 1, 1982, and were retained in Exec. Order No. 126 , January 30, 1987. In view of the official functions of the POEA, there is now a ban on “direct hires”. This means that no foreign employer, principal or contracting partner may directly hire a Filipino worker for overseas employment except through the POEAor through agencies authorized by the DOLE This allows as exceptions the hiring by members of the diplomatic service, officials and employees of international organizations, and such other categories of employers as may be authorized by the Secretary subject to guidelines as the POEA may prescribe. “Name hires”, which are individual! workers who are able to secure contracts for overseas employment on their own, without the assistance or participation of any government agency or entity, are not covered by this ban. Nevertheless, their contracts for overseas employment shall be processed by the POEA.

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