Friday, June 23, 2006

Flawed in Practice:Is it time to abolish the NLRC? Part VI

The first five parts of this series tried to show why the NLRC as an institutional concept of social justice is flawed. Today, I will try to show why it is a failure in practice.

In post number 4, I mentioned that the labor arbiter was given a near absolute power to decide on the outcome of a labor dispute, and the employer's option to appeal is rendered useless, because an adverse decision of the labor arbiter is immediately executory. As a result, the labor arbiters are the prime targets for corruption.

Now, I will not say that there are labor arbiters who could be swayed to rule in favor of a party for a measly Php 30,000. I will not say that they even ask their patrons to draft the decision in exchange for cash. I will not say that any given Friday night, you will see many of these arbiters carousing the night away with litigants in bars and videoke private rooms in Timog Ave. and Quezon Ave. . I will not say that labor arbiters, who are not musically-inclined like the others, prefer to be included in the payrolls of big business and big labor unions. Why will I say those things?

Instead, I will say that labor arbiters cannot be insulated from the corruption that pervades the entire justice system in this country. What does that mean? It means that you can ask every labor arbiter if any of them has ever been approached to rule in favor of a litigant in exchange for favors, and most likely they will say yes. But if you ask them if they ever agreed, they will probably say no. But you will never know the truth to their answer on the second question. All I can say is you are stupid if you believe their answer to the second question. Do you ever wonder why the NLRC does not have a reputation for honesty? It's because there are no institutions in this country with an honest reputation.

One of my early memories as a young lawyer doing the rounds of labor hearings is that of a laborer counting his cash after a successful execution of a money award. After counting, the laborer handed about four pieces of 500 peso bills to the secretary of the labor arbiter in open view of everyone in the room. And seeing our disapproving looks, the secretary said "why will I refuse money which is given to me for free?" as she opened her drawer and dropped the day's loot into it.

I know I should be saying more, but my fellow lawyers who have practiced before the NLRC can do the rest for me. Ask them if the NLRC is an honest institution. I bet you one percent of them will vouch for its honesty, and the ninety-nine percent will roll their eyes.

(To be continued)

Thursday, June 15, 2006

The appeal that is not an appeal (Is it time to abolish the NLRC? Part 5)

The time has come to abolish the NLRC. This is the thesis of this series, and today I will discuss the unfair appeal process of the NLRC and its effect.

The NLRC Rules of Procedure provides that when a labor arbiter decides in
favor of an employee, i.e., there is a ruling that the dismissal of an employee is illegal, the decision is immediately executory. The employer may appeal the ruling before the National Labor Relations Commission, but regardless of the appeal, the employee should be reinstated to his employment. If the employer does not like to reinstate the employee, the employer may reinstate the employee only in the payroll. This means that the employee will get paid even if he does not report for work.

As an employer myself of a small enterprise this rule is one of the toughest rule to accept. It is bad enough that an employer has to employ somebody he dislikes; it is worse if the employer is forced to pay the employee for not working at all – and this because a labor arbiter said so. The labor arbiter is not impeccable, he makes errors of judgment like every ordinary person.

But with the rules of appeal making the decisions of the labor arbiter executory pending appeal, the labor arbiter's word is law. The value of the appeal process to the employer is negated, because the employer is forced to follow the decision of the labor arbiter even if the decision is not yet final.

Thus, in view of the crucial role of the labor arbiter in the labor dispute, the labor arbiter is the prime target for corruption and influence peddlers. I will have a separate post on corruption in the NLRC in the next few days, but here what I am trying to show is that because of the worthless appeal process, the labor arbiters are the strongest target for corruption. The key question is, can we expect the labor arbiters not to be corrupted?

(To be continued)

Saturday, June 10, 2006

Presumed Guilty (Is it time to abolish the NLRC part 4)

The fallacy of the NLRC's bias for labor is the point of this series. And I proceed to show the unfairness of its rules of procedure on labor cases.

I mentioned in the first post that in an illegal dismissal case, the burden of proving the legality of an employee's dismissal is on the employer. If it were a basketball game, labor gets plus twenty points.

The NLRC Rules of Procedure provides that in the event that the mediation conference fails, the parties are required to simultaneously submit their position papers. As a practicing lawyer, l've gone through this procedure many times, and there many instances when I got a mere two-page document as an employee's position paper. Those position papers have practically nothing to say, but they don't have to say anything to begin with, because the burden of proof is on the employer.

Again, this unfairness in the rules could be tolerated by big corporations, but to small and medium enterprises, which populate Philippine commerce, it's a cruel joke.
Whimsical and arbitrary labor complaints, even if apparent in a two-page position paper can still have a chance to win millions of pesos if the employer is unable to discharge the burden of proof properly. And in discharging the burden of proof properly, the employer has to procure the services of competent and pricey lawyers. How can we expect small and medium enterprises to thrive, if the NLRC cannot protect it from baseless and whimsical labor complaints?

In ordinary civil cases, the party who alleges a fact has the burden of proof to support the allegation. In a labor case, the employee alleges the fact of illegal dismissal, but the burden of proof that the dismissal is legal is on the employer. In other words, any employee can go the NLRC and claim illegal dismissal, and the employer has no choice but to spend for legal services to prove otherwise. The employer is presumed guilty, just by the mere say so of the employee.

The premise of this rule is that all employees are saints, and all employers are rich enough to pay for legal costs. The absurdity is staring at us. It's time to get real.

(To be continued)

Friday, June 09, 2006

Forced to Settle (Is it time to abolish the NLRC? Part 3)

A pro-labor quasi-judicial agency administering labor relations stalls progress in this country. In the last entry, I pointed out that the NLRC rule making it easy to file labor complaints has caused the flooding of the NLRC with whimsical and baseless labor cases. Today, I continue with another ill-effect of this pro-forma filing of labor cases.

Once a labor case has been commenced and summons has been served any prudent employer will have no choice but to send a lawyer to represent the employer in the hearing. Immediately, the employer incurs costs in procuring the services of a lawyer.

The average legal cost for handling a labor case may be conservatively estimated at 50,000 pesos. Thus, the employer is already hit with a budget item. To big companies like PLDT or Ayala Corporation, 50,000 pesos is nothing. Unfortunately for this country, there are very few PLDTs and Ayala Corporations here. The average enterprise in this country will feel the hit of a 50,000 useless expense. That money is about the cost of two computers that could be used for operations, or about the cost of one payroll for eight employees. It would take only one whimsical foolish employee to fill out a pro-forma complaint for an employer to get hit with 50,000 pesos.

Normally, the first two hearings with NLRC is meant for mediation and conciliation. The procedure is concluded with a deal on the table. The employee would demand for cash and the employer would have a tough choice to make: settle the claim forever at a fixed amount or watch his litigation expenses grow as the case progresses. The decision is made even tougher if the employer feels that the claim is unjust. The employee was guilty and was properly disciplined or terminated. But faced with a dilemna where he could fight for a principle and impair his business
or swallow his pride and protect his livelihood, the easy way to go is to settle.

Thanks to the NLRC the bastion of the labor movement many small and medium businesses are faced with this dilemna everyday.

(To be continued)

Thursday, June 08, 2006

The False Premise in Action (Is it time to abolish the NLRC? Part 2)

Time was when this country was ruled by statesmen who divided it into two: the haves and the have-nots, and built the government on this premise. In the field of labor administration, the division is between the capitalists-enterpreneurs and the workers. And because the fictional exemplar of labor is the oppressed, poverty-stricken worker, labor administration tilts heavily in favor of labor.

Yet, as stated a post ago, the premise is greatly flawed, because this country is not just ran by capitalists and workers. A big number of people defy classification: workers who double as enterpreneurs, enterpreneurs who work for their business, and people who are neither enterprenuers or workers, but somehow get involved in this class dichotomy. The saddest part is the people in the middle outnumber those in the opposite extremes combined. Thus, to govern labor relations on the premise of this monochromatic thinking is to ignore the vast majority who is trapped in the middle.

Let's examine how this flawed thinking is implemented by the NLRC with disastrous results.

When an employee sues his employer, all he has to do is fill-out a mimeographed form, check the boxes in the form to indicate his causes of action, sign it and it is all over in a few minutes. No lawyers required. Immediately, the case is deemed commenced, and the employer is summoned for a hearing.

While I don't have anything agaisnt efficiency, I think this kind of out-of-the-box procedure is a great contributor to the great number of whimsical cases that clog the dockets of the NLRC. Hardly anybody thinks about what they put in those forms. I once received a labor complaint, where the complainant checked all the boxes for unpaid wages, holiday pay, and thirteenth month pay, when the truth was he was fully paid for all his services, and his principal cause of action was that of illegal dismissal only. When examined during the labor conference, the fool admitted having checked those boxes because he thought that by checking them he would still be entitled to them.

Yet, if for example, it was the employer who had a cause of action against his employee, the employer will have to hire a lawyer, who will counsel the employer on whether it is worth it to file a case. It is only after the lawyer and the employer have examined their position that a decision to file a case or not is made. And if the decision is to file a case, the lawyer has to draft a complaint specific to the causes of action. The entire procedure allows the employer to contemplate about the course of action knowing that filing a case has its burden.

Sadly, as the NLRC's existence is premised on making things easy for labor, labor complainants have hardly anytime to contemplate on their decision to file a case. The result is a build up of pointless cases before the NLRC. These pointless cases not only clog the dockets but cost millions of pesos in fees and management time of employers, millions that could have been better used to improve working conditions of the other employees back in the office.

Efficiency has its costs. They made it easy for people to complain, so they got flooded with complaints. It's the false premise in action.

(To be continued)

Wednesday, June 07, 2006

Is it time to abolish the NLRC? (Part 1)

The National Labor Relations Commission (NLRC) is a specialized quasi-judicial government agency that deals specifically with labor issues. Save for a few exceptions, any dispute relating to employer-employee relations will fall under NLRC jurisdiction.

Every time I have a case in the NLRC, I often remember what the late President Ramon Magsaysay used to say about social justice: "Those who have less in life should have more in law." In the entire landscape of the government burueacracy, the NLRC is undoubtedly the place where you can find the highest density of social justice on a per square inch basis. Every rule of this agency favors labor; from the filing of the complaint to the appeal of its rulings -- every step of the way is like a rose garden for labor and a bloody road for management.

Well, I know have to support the above assertion with facts, and I will do that as I proceed with this series, but let met just get this point out in the open: The NLRC is a big obstacle to economic progress. It is flawed in theory. It is flawed in practice. And if I had billions of dollars to invest in the Philippines, and I had one wish that the politicians in Congress would grant, that would be the abolition of this antiquated Marcosian legacy called the N.L.R.C.

1. False Premise. False Logic.

One of the hardest things to explain to a client who was been sued before the NLRC is the rule that the employer has the burden of proof in an illegal dismissal case. This means that if an employer dismisses an employee, and the employee goes to the NLRC, the dismissal is presumed to be illegal, unless the employer proves otherwise. In other words, if you were to compare an illegal dismissal case to a basketball game, labor has plus twenty points.

Pro-labor advocates defend this "handicap rule" on the premise that the employee is presumed to have less resources to engage in litigation, and capital or management has more resources to get in a legal fight. Thus, the handicap is meant to equalize the built in advantage, as it were, of capital. This is the biggest lie ever told in the history of the labor movement in this country.

Most certainly, not all employees are poor, and not all employers are rich. Just because a person has money to put up a business does not mean he has a built-in advantage in a labor case; and, most certainly, just because a person chose to be employed does not mean he has a disadvantge in a labor dispute.

The truth is for every Ayala corporation-style employer in this country, there are hundreds of thousands more employers struggling to survive. And if you put a budget item in their balance sheet for litigation expenses, most if not all of them, will not meet their payrolls and some would even close shop. And as I type this piece, I half-remember companies that closed shop because of a labor dispute gone awry. Rubberworld? Divine Word College? There are hundreds in the list -- sure-fire proofs that the premise of a pro-labor NLRC could be fatal to business.

And when an employer closes shop is that ever a victory for labor? Social Justice is a very fashionable catch phrase for our politicians, and they have been mouthing it for decades. But none had come up to ask the question: is the kind of social justice that we have here the reason why this country is in a rut? Could it be the reason why we have very few success stories in business?I'm ten years in labor litigation. I say yes, probably not the sole reason, but certainly one of the primary reasons.

(To be continuted)

Sunday, June 04, 2006

What's the gov't doing about the brown tree snake threat from Guam?

My wife, Ces, told me about a friend of hers who had to skip a vacation in the beaches of Guam, because of the brown tree snake epidemic in the island. I did not believe the tale until I checked out the links from Google that led me to this site.

An entry from Wikipedia, provides this background:

(Guam) is also known as a prominent example for the disastrous effects of bioinvasion: A stowaway on U.S. military transport at the end of World War II, the slightly venomous, but rather harmless, brown tree snake (Boiga irregularis) came north to Guam and killed almost the entire native bird population on the previously snake-free island. This snake has no natural predators on the island; nowadays, Guam is one of the areas with the highest snake density in the world (an estimated 2,000 snakes/km²). Even so, residents rarely see these snakes. They curl up and hide during the day, and move about on trees and fences at night. As prodigious tree climbers, the snakes allegedly caused frequent blackouts in neighborhoods across the island. They climb up the poles, into the black boxes, and electrocute themselves. Now many power poles have a slick metal sheath that prevents the snakes from climbing.

This fact sheet is also informative.

The snakes have already invaded Saipan, and the people from Hawaii have also noted the threat, and have prepared for it.

The queation is what about the Philippines? Are we even aware of this threat?

Friday, June 02, 2006


I'd appreciate it if anyone can give me information about the owner of the site shown above. The blog copied 99.9% of my Eraserheads review of the Ultraelectormagneticjam which appeared here. Please warn that idiot that I have a law office, and we have plenty of time and resources to sue people like him. And if he ever sets foot on the Philippines, he's going straight to jail.