'srl111h> 
SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
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SEP -3 
111(' "32 
rill,} • 
First Regular Session 
SENATE 
Senate Bill No. 1462 
fI 
l ' ,:';!) BY:-f-
INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
EXPLANATORY NOTE 
The evolution of mechanisms designed to resolve industrial and labor 
disputes from the Court of Industrial Relations established under CA No. 103 
(1936) to the curre'nt system under the Labor Code (P.D. No. 442 as amended) 
has resulted in a web' of intricate and often overlapping jurisdictions which is 
continuously plagued by perceptions of inefficiency, ineffectiveness and 
corruption. The present proposal argues in favor of a holistic and comprehensive 
approach to the problems besetting our industrial and labor dispute resolution 
system. In essence, the following are the key issues which the proposed new 
system of industrial and labor dispute resolution addresses: 
1. As the system of resolving 'industrial and labor disputes developed, we 
observe a gradual shift from court-situated adjudication to the introduction of 
mediation and voluntary arbitration as means to bring the outcome of industrial 
and labor disputes closer to the desires and needs of the parties involved. And 
yet, as it stands, industrial and labor disputes are still resolved by compulsory 
arbitration either at the National Labor Relations Commission (NLRC), by the 
Secretary of Labor and Employment, and even by the inappropriately named 
system of voluntary arbitration. Methods of alternative dispute resolution (ADR) 
remain footnotes to the whole dispute resolution process, particularly as they are 
given merely a token significance at the labor arbiter's level. This, 
notwithstanding that industrial and labor disputes are arguably the most fertile 
ground in which ADR may bear fruit. 
Hence, even if ADR is more thought out and emphasized in agencies such 
as the National Conciliation and Mediation Board (NCMB), ADR remains at the 
fringes of the Philippine industrial and labor dispute resolution system. Hence, 
there is a need to bring ADR processes into the forefront of and embed it at 
the core of the State mechanism designed to address industrial and labor 
disputes. Corollarily, there is a need to formulate and implement ADR 
processes intelligently and comprehensively, thus maximizing its benefits 
to the stakeholders in particular and to the State in particular. 
2. Through the introduction of piecemeal amendments to the industrial and 
labor dispute resolution process, our current system is now characterized by 
multiple venues, a large bureaucracy and often confusing rules regarding 
jurisdiction and procedure. The Department of Labor and Employment classifies 
labor disputes into disputes between: 
1.) the employer and its employees or employee's organizations' 
2.) two associations of employees; and 
\: 


" 
" 
3.) members of employees' organizations 
Further, the Department categorizes these disputes into three: 
• 
Labor Standard Disputes include non-payment or under-payment of wages 
and wage-related benefits and violations of health and safety standards. 
• 
Labor Relations Dispute include employee discipline or dismissals, unfair 
labor practices, disputes arising from the right of unions to represent 
employees for purposes of bargaining, bargaining deadlocks, strikes and 
lockouts, contract administration, and personnel policy disputes. 
• 
Welfare and Social Legislations Disputes refer to claims anslng from 
failure of the employer to comply with its social and welfare obligations under 
the law, such as remittance of SSS premiums and ECC contributions, or 
failure to pay social benefits including maternity pay, medicare and disability 
compensation. 
Persons intending to file a claim regarding any of the issues above must 
sort through a virtual maze of agencies to which she may be directed. According 
to the Department: 
• 
Labor Standards Disputes, including simple money claims not exceeding 
P5,OOO.OO, which arises out of employee-employer relations are referred 
to the Regional Office (RO) of the DOLE. 
• 
Labor Relations Disputes, particularly illegal dismissals with or without 
claim for reinstatement, I:lnfair, labor practices, strikes and lockouts and 
claims of damages are referred to the labor Arbiter in the Regional 
Arbitration Branches of NLRC. 
• 
Union Representation are referred to the Med-Arbiter of the DOLERO 
• 
Intra-Union Disputes and Cancellation of Union Registration are referred 
to the DOLE-RO or the Bureau of Labor Relations. 
• 
Bargaining Deadlocks Needing Conciliation and Mediation are referred to 
the Regional Branches of NCMB. 
• 
CBA Administration Disputes Involving Personnel Policies are referred to 
the Grievance Machinery at the establishment, if any, then with the 
regional branches of the NCMB. 
• 
Social Legislation Disputes are referred to the Regional Branches of the 
ECC or the SSS. 
It is observed that the multiplicity of venue which marks our current system is 
not by design nor was intentional in any way. On the contrary, the intricate 
system we have is the result of a lack of design and need of a well considered 
plan. In essence, we have failed to ask why we have such a system and more 
basic, can we not have a single entry point for all industrial and labor disputes? 
Hence, there is a need to rethink the current system of resolving industrial 
and labor disputes in order to promote simplicity and minimize the 
bureaucracy which needs to support it This will address the pervading 
confusion in jurisdictions of the present system. There is a need to create a 
system where stakeholders can take their issues to a single agency which 


" 
has the requisite expertise to address the distinct dynamics and 
characteristics of industrial and labor disputes. 
3. The speed (or lack thereof) by which industrial and labor disputes are 
resolved is a function of the efficiency of our dispute resolution mechanism. 
Currently, simple labor cases may take five to seven years to go through the 
present system from the plant level to the Supreme Court and to execution. 
Hence, there is a need to expedite the manner by which industrial and labor 
disputes are resolved. Opportunities for delay and hence, corruption, 
should be minimized and appeals, while necessary, should be limited to 
petitions for certiorari before the Supreme Court. Needless to say, the 
matter of delay could also be addressed by a system of mediation designed 
to reduce the number of claims reaching arbitration. 
For these reasons, a new system of resolving industrial and labor disputes 
is proposed. Building on concepts already in place, the proposed scheme is 
characterized by the following changes: . 
. 
1. Single entry. All industrial and labor disputes are to be brought to a 
single agency, the newly created National Mediation and Arbitration Board 
(NMAB). 
2. Mediation as the backbone. All claims brought to the NMAB shall be 
subject to mediation efforts conducted by persons hired and trained specifically 
for that purpose. This is a great departure from the present system where 
mediation is perfunctorily performed by arbiters and even untrained assistants. 
Mediation proceedings are, as tl1ey ~hould be, kept confidential. This is a far cry 
from the present system where mediation is entrusted to the person who is 
subsequently to decide the same case. Only where mediation fails to help the 
parties reach an agreeable settlement are claims brought before arbitration. 
3. Professional Arbitration. Arbitrators should be familiar with employer -
employee issues though they need not be lawyers. Arbitrators shall be accredited 
and named in a list kept by the Department of Labor and Employment. A 
selection process allows parties to entrust their cases to arbitrators who have 
shown competence and probity over time. 
4. Direct recourse to the s~preme Court. Arbitral Awards shall be final 
and executory except by petition fo ~f~rtiorari before the Supreme Court. While 
each of the above features is in itE!lf a big step forward beyond the Present 
system, the strength of the presen~roposal lies in the integration of all these 
features into a single and united whole, with each part designed to complement 
the others as well as the sum. 
Hence, the support of this bill is earnestly sought. 
OY EJERCITO ESTRADA 
Senator 


'. 
S"I1!lh 
SIXTEENTH CONGRESS OF THE REPUBLIC 
OF THE PHILIPPINES 
) 
) 
) 
<@Hlff of j~. ~w.t •• ¥ 
First Regular Session 
'13 
SEP -3 AlO :32 
SENATE 
Senate Bill No. 14 6 2 
INTRODUCED BY SEN. JINGGOY EJERCITO ESTRADA 
AN ACT 
TO ENHANCE THE PHILIPPINE INDUSTRIAL AND LABOR DISPUTE 
SETTLEMENT SYSTEM AND FOR THAT PURPOSE, AMENDING CERTAIN 
PROVISIONS OF PRESIDENTIAL DECREE NO. 442 OTHERWISE KNOWN 
AS THE LABOR CODE OF THE PHILIPPINES 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
SECTION 1. Short Title. This Act shall be known as the "Industrial and 
Labor Dispute Settlement Act of 2013". 
. . . 
SEC. 2. Declaration of Policy. Article 211 of the Labor Code shall be 
repealed and replaced as follows: 
"Article 211. Declaration of Policy. A. It is the policy of the State: 
(a) To promote and emphasize the primacy of free collective 
bargaining and negotiations AND THE USE OF ALTERNATIVE 
MODES OF DISPUTE RESOLUTION, INCLUDING MEDIATION, 
as modes of settling industrial or Jabor disputes; 
(b) To promote free trade unionism as an instrument for the 
enhancement of democracy and the promotion of social justice and 
development; 
(c) To foster the free and voluntary organization of a strong 
and united labor movement; 
(d) To promote the enlightenment of workers concerning 
their rights and obligations as union members and as employees; 
e) To provide an adequate administrative machinery for the 
expeditious settlement Qf industrial and labor disputes; 
f) To ensure a stable but dynamic and just industrial peace; 
and 
g) To ensure the participation of workers in decision and 
policy-making processes affecting their rights, duties and welfare. 
) BY:+ 


B. To encourage a truly democratic method of regulating the 
relations between the employers and employees by means of 
agreements freely entered into through collective bargaining, no 
court or administrative agency or official shall have the power to set 
or fix wages, rates of pay, hours of work or other terms and 
conditions of employment, except as otherwise provided under this 
Code." 
SEC. 3. Definitions. Article 212 of the Labor Code shall be repealed and 
replaced as follows: 
"Article 212. Definitions. 
"Chapter II 
DEFINITIONS 
a) "Alternative Dispute Resolution" and "ADR refer to any process 
or procedure used to resolve a dispute or controversy other than 
by adjudication of a judge of a court or tribunal in which a 
neutral third party participates to assist in the resolution of 
issues, which includes arbitration, mediation, early neutral 
evaluation, mini-trial, or any combination thereof. 
b) "Arbitral Award" means any final decision by an arbitrator in 
resolving the issue in ~n inpustrial or labor controversy. 
c) "Arbitration" means a voluntary dispute resolution process in 
which one or three arbitrators, appointed in accordance with this 
Code, resolve an industrial or labor dispute, consistent with the 
Code, by rendering an award. 
d) "Arbitrator" refers to the person chosen according to this Code 
to render an award in an appropriate industrial or labor dispute. 
e) "Bargaining 
representative" 
means 
a 
legitimate 
labor 
organization the members of which mayor may not be 
employed by the employer. 
f) "Bureau" means the Bureau of Labor Relations and/or the Labor 
Relations Divisions in the regional offices. 
g) "Board" refers to the National Mediation and Arbitration Board. 
h) "Claimant" or "Complainant" refers to any party who files a claim 
with the Board in accordance with the Code. 
i) 
"Contempt" refers to either direct or indirect contempt and, as 
used in this Act, may call for the suppletory application of the 
pertinent provisions of the Rules of Court. 
j) "Company union" means any labor organization whose 
formation, function or administration has been assisted by any 
act defined as unfair labor practice by this Code. 


k) "Council" refers to the Tripartite Industrial Peace Council under 
Executive Order No. 49 series of 1998, and Executive Order No. 
97, series of 1999. 
I) "Employer" includes any person acting in the interest of an 
employer, directly or indirectly. The term shall not include any 
labor organization or any of its officers or agents except when 
acting as employer. 
m) "Employee" includes any person in the employ of an employer. 
The term shall not be limited to the employees of a particular 
employer, unless the Code so explicitly states. It shall include 
any individual whose work has ceased as a result of or in 
connection with any cl,lrrent industrial or labor dispute or 
because of any unfair labor practice. 
n) "Industrial and labor dispute" includes any controversy or matter 
concerning terms and conditions of employment or the 
association or representation of persons in negotiating, fixing, 
maintaining, changing or arranging the terms and conditions of 
employment, regardless of whether the disputants stand in the 
proximate relation of employer and employee. 
0) "Internal union dispute" includes all disputes or grievances 
arising from any violation of or disagreement over any provision 
of the constitution and by laws of a union, including any violation 
of the rights and condi~ion~ of union membership provided for in 
this Code. 
' 
p) "Labor organization" means any union or association of 
employees which exists in whole or in part for the purpose of 
collective bargaining or of dealing with employers concerning 
terms and conditions of employment. 
q) "Legitimate labor organization" means any labor organization 
duly registered with the Department of Labor and Employment, 
and includes any branch or local thereof. 
r) "Lockout" means any temporary refusal of an employer to 
furnish work as a result of an industrial or labor dispute. 
s) "Managerial employee" is one who is vested with the powers or 
prerogatives to lay down and execute management policies 
and/or to hire, transfer, suspend, lay-off, recall, discharge, 
assign or discipline employees. Supervisory employees are 
those who, in the interest of the employer, effectively 
recommend such managerial actions if the exercise of such 
authority is not merely routinary or clerical in nature but requires 
the use of independent judgment. All employees not falling 
within an of the above definitions are considered rank-and-file 
employees for purposes of this Book. 
t) "Mediation" refers to the process defined by the Code in which a 
mediator, 
selected 
according 
to 
the 
Code, 
facilitates 
communication and negotiation, and assist parties in reaching a 
voluntary agreement regarding an industrial or labor dispute. 


u) "Mediators" refers to a person who conducts mediation. 
v) "Respondent" refers to any party against whom a claim has 
been filed in accordance with this Code. 
w) "Strike" means any temporary stoppage of work by the 
concerted action of employees as a result of an industrial or 
industrial and labor. 
x) "Strike area" means the establishment, warehouses, depots, 
plants or offices, including the sites or premises used as 
runaway shops, of the employer struck against, as well as the 
immediate vicinity actually used by picketing strikers in moving 
to and fro before all points of entrance to and exit from said 
establishment. 
y) "Strike-breaker" means any person who obstructs, impedes, or 
interferes with by force, violence, coercion, threats, or 
intimidation any peaceful picketing affecting wages, hours or 
conditions of work or in the exercise of the right of self-
organization or collective bargaining. 
z) "Unfair labor practice" means any unfair labor practice as 
expressly defined by the Code." 
SEC. 4. Dispute, Resolution,system. Article 213 ofthe Labor Code shall 
be repealed and replaced as follows: 
"Title II 
RESOLUTION OF INDUSTRIAL AND LABOR DISPUTES 
"Article 213. A. The National Mediation and Arbitration Board. 
There shall be a National Mediation and Arbitration Board which 
shall be attached to, administered, and supervised by the 
Department of Labor and Employment, composed of an Executive 
Director and four (4) Deputy Executive Directors. The Executive 
Director shall exercise supervision over all personnel of the Board, 
including mediators and arbitrators. The Board shall also be 
composed of as many mediators, sheriffs, and staff members as 
shall be necessary for its effective operations. 
The Board shall haVe its main office in Metropolitan Manila and 
shall establish as many branches as there are administrative 
regions in the country, with as many mediators for each branch as 
shall be necessary for their effective operations. Each branch of the 
Board shall be headed by an Executive Mediator who shall be 
appointed by the Executive Director. 
"B. 
The Executive ., Director and Deputy Directors. The 
Executive Director shall be appointed by the President for a term of 
three (3) years upon recommendation of the Secretary of Labor and 
Employment. Workers' groups represented 
in the Tripartite 
Industrial Peace Council shall submit a list of six (6) names to the 
President who shall choose two persons from the list to serve as 
Deputy Executive Director's of the Board. Likewise, employers' 


.' 
groups represented in the Tripartite Industrial Peace Council shall 
submit a list of six (6) names to the President who shall choose two 
persons from the list to serve as Deputy Executive Directors of the 
Board. Each Deputy Executive Director shall serve for a term of 
three (3) years. 
"The Executive Director shall receive an annual salary at least 
equivalent to, and be entitled to the same allowances and benefits, 
including retirement, to that of a Justice of the Court of Appeals. 
Each Deputy Executive Director shall receive an annual salary at 
least equivalent to, and be entitled to the same allowances and 
benefits, including retirement; to that of an Assistant Secretary of 
the Department of Labor and Employment. In no case, however, 
shall the provision of this article result in the diminution of existing 
salaries, allowances and benefits of the aforementioned officials. 
"C. Mediators. Each Mediator shall be appointed by the Secretary 
of Labor and Employment, provided that the Secretary shall ensure 
that at least thirty percent (30%) of all mediators females and 
provided further, that each mediator should: 
1) have at least five (5) years of experience in handling industrial or 
labor matters; and 
2) have at least one hundred twenty (120) hours of relevant training 
on alternative dispute resolution given by an institution accredited 
by the Board or by the pffiqe for Alternative Dispute Resolution 
created under Republic Act No. 9285; 
3) after being appointed, undergo regular training on alternative 
dispute resolution given by an accredited institution of the Board or 
by the Office for Alternative Dispute Resolution created under 
Republic Act No. 9285. 
"Mediators shall hold office during good behavior until they reach 
65 years of age or unless sooner removed for violation of their 
duties under law or rules or 
become incapacitated to discharge the duties of their office. 
"The Secretary of Labor and Employment shall formulate and issue 
a Code of Conduct for Mediators in Industrial and Labor Disputes 
which shall provide for the standard of conduct expected of all 
Mediators of the Board in discharging their duties. Violation of said 
Code of Conduct shall be ground to dismiss a Mediator from office. 
"d. Arbitrators. Arbitrators shall not be permanently employed by 
the Board and shall render service and receive compensation only 
in case of actual arbitration of an industrial or labor dispute. 
Arbitrators may be called upon by the Board to arbitrate an 
industrial or labor dispute provided that they are listed in the 
Department's official Iisfof Arbitrators. For this purpose, the Board 
shall maintain a list of accredited arbitrators which shall be 
reviewed annually by the Board. 
"In addition to procedures and requirements determined by the 
Secretary, accreditation shall ensure that arbitrators are persons of 
distinction in whom employers, employees, employees' groups and 


the government can have confidence. Arbitrators should have at 
least five (5) years of experience in handling industrial or labor 
matters. They shall have no personal or financial interest in the 
results of the proceedings in which they are appointed and shall 
have no relation to the underlying dispute or to the patties or their 
counsel that may create an appearance of bias. 
"The Secretary of Labor and Employment shall formulate and issue 
a Code of Conduct for Arbitrators in Industrial and Labor Disputes 
which shall provide for the standard of conduct expected of all 
Arbitrators of the Board in discharging their duties. Violation of the 
Code of Conduct for Arbitrators, including failure to issue an award 
within the mandatory period, shall constitute sufficient ground to 
revoke his accreditation as an arbitrator. The Code shall identify 
that conduct which may be groundl? to remove and replace an 
arbitrator from a particular dispute which he has already accepted 
to arbitrate. 
"E. Staff. The Secretary of Labor and Employment shall, in 
conSUltation with the Executive Director, appoint the staff and 
employees of the Board and its regional branches, including 
sherrifs, as the needs of the service may require, subject to the civil 
service law, rules, and regulations, provided that the Secretary shall 
ensure that at least thirty percent (30%) of the staff so appointed 
shall be female. 
The Secretary shall fonnulate, and issue a Code of Conduct for 
sheriffs and staff in Industrial and Labor Disputes which shall 
provide for the standard of conduct expected of all sheriffs and staff 
of the Board in discharging their duties." 
SEC. 5. Functions and Powers of the Board. Article 214 of the Labor 
Code shall be repealed and replaced as follows: 
"ART. 214. Functions and Powers of the Board. - The 
Board shall have the power and authority: 
(a) 
To promulgate rules and regulations governing the mediation 
and arbitration of disputes before it and its regional 
branches, as well as those pertaining to its internal functions 
and such rules and regulations as may be necessary to carry 
out the purposes of this Code; 
(b) 
To administer oaths, summon the parties to a controversy, 
issue subpoenas requiring the attendance and testimony of 
witnesses or the production of such books, papers, 
contracts, records, statement of accounts, agreements, and 
others as may be material to the matter under investigation, 
and to testify in any investigation or hearing conducted in 
pursuance of this Code; 
(c) 
In arbitration, to p'roceed to hear and determine the disputes 
in the absence of any party thereto who has been 
summoned or served with notice to appear, and in mediation 
and arbitration, to conduct investigation for the determination 
of a question, matter or controversy within its jurisdiction, 
conduct its proceedings or any part thereof in public or in 
private, adjourn its hearings to any time and place, refer 


technical matters or accounts to an expert and to accept his 
report as evidence after hearing of the parties upon due 
notice, direct parties to be joined in or excluded from the 
proceedings, correct, amend, or waive any error, defect or 
irregularity whether in substance or in form, and give all such 
directions as it may deem necessary or expedient in the 
determination of the dispute before it; 
(d) 
To hold any person in contempt directly or indirectly and 
impose appropriate penalties therefor in accordance with law 
and the Rules of Court; 
(e) 
In appropriate cases and according to this Code, to enjoin or 
restrain any actual or threatened commission of any or all 
prohibited or unlawful acts or to require the performance of a 
particular act in any industrial or labor dispute; 
(f) 
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 investigation." 
SEC. 6. Jurisdiction. Article 215 of the Labor Code shall be repealed and 
replaced as follows: 
"Article 215 . CI~ill's ~ognizable by the Board. The Board 
shall have original and exclusive jurisdiction to mediate and 
arbitrate all industrial or labor disputes including the 
following: 
1. 
Claims involving wages, rates of pay, hours 'of work 
and other terms and conditions of employment; 
2. 
Claims for any sum of money, regardless of amount; 
3. 
Claims of illegal or ineffectual termination 
or 
suspension; 
4. 
Claims for actual, moral, exemplary and other forms 
of damages, as well as interest, attorney's fees, and 
costs of litigation arising from employee-employee 
relations; 
5. 
Claims under Section 10 of Republic Act No. 8042; 
6. 
Claims of legitimate labor organizations against other 
labor organizations; 
7. 
Claims against labor organizations made by their 
members or other interested parties; 
8. 
Claims arising from bargaining deadlock; 
9. 
Claims of unfair labor practice; 
10. 
Claims arising from any violation of Article 264 of this 
Code, including claims involving the legality of strikes 
and lockouts; 
11. 
Claims of' any violation of a collective bargaining 
agreement 
including 
those 
arising 
from 
the 
interpretation or implementation of the collective 
bargaining agreement; 
12. 
Claims arising from the interpretation, implementation, 
or enforcement of company personnel policies or 
similar rules, including disputes which are not 


resolved even after going through the appropriate 
grievance procedure; 
13. 
Any other claims arising from an employer-employee 
relationship; 
14. 
Claims involving injunction and temporary restraining 
orders arising from the disputes enumerated herein. 
"No dispute, claim, complaint, or petition, including those for 
restraining orders or injunctive relief, arising out of, related 
to, or involving the above disputes shall be heard or decided 
by any other court Or tribunal, except by the Supreme Court 
which may give due course to a petition for certiorari 
involving an arbitral award. 
"However, claims within the exclusive jurisdiction of the 
Employee's Compensation Commission (ECG) or the Social 
Security System (SSS) are excluded from the coverage of 
this Article. Likewise, registration of labor organizations and 
proceedings to determine majority representation among 
employees shall continue to be filed with the appropriate 
Regional Office and shall not be within the jurisdiction of the 
Board as herein defined." 
SEC. 7. Mediation. Article 216 of the Labor Code shall be repealed and 
replaced as follows: 
'", 
,,' I 
"Article 216. A. Immediate referral to Mediation. All 
disputes filed with the Board shall immediately be referred to a 
mediator who shall mediate between 
the parties for a period not exceeding sixty (60) calendar 
days from the date of the initial conference without extension. After 
a claim is filed, the. Board shall set the case for preliminary 
conference and a notice to the parties thereof shall be sent not later 
than five (5) days after referral to a mediator. 
"The mediator shall be chosen by the Board upon 
considering the nature and complexity of the claims as well as the 
preferences of the parties; if known. One (1) mediator will be 
appointed unless the Board determines otherwise. 
"In all disputes, no person shall serve as a mediator in any 
dispute in which that person has any financial or personal interest 
in the result of the mediation, except by the written consent of all 
parties. Prior to accepting an appointment, the prospective 
mediator shall disclose any circumstance likely to create a 
presumption of bias. Upon receipt of such information, the Board 
shall either replace the mediator or immediately communicate the 
information to the parties for their comments. In the event that the 
parties disagree as to whether the mediator shall serve, the Board 
will appoint another mediator. The Board is authorized to appoint 
another mediator if the appointed mediator is unable to serve 
promptly. 
" Process of Mediation. 


"1. Representatien. Any patty may be represented by a 
person of the party's choice. The names and addresses of such 
persons shall be communicated by the respective parties in writing 
to all parties and to the Board. 
"2. Date, Time, and Place ef Mediatien. The mediator shall 
fix the date and the time of each mediation session. The mediation 
shall be held at the appropriate regional office of the Board, or at 
any other convenient location agreeable to the mediator and the 
parties, as the mediator shall determine. 
"3. Identificatien ef Matters in Dispute. The mediator shall 
exercise complete control over all mediation proceedings in pursuit 
of a just, adequate, and speedy agreement between the parties. 
During the first hearing, the mediator shall identity the issues 
involved and the respective opinions of the parties thereto. The 
parties will be expected to produce al\ information reasonably 
required for the mediator to understand the issues presented. For 
this purpose, the mediator may issue subpoenas duces tecum and 
subpoenas ad testificandum to require the production of necessary 
documents, property, or persons and may cite persons in violation 
of such orders in contempt. 
"4. Autherity ef Mediater. The mediator does not have the 
authority to impose a settlement on the parties but will attempt to 
help them reach a satisfactory resolution of their dispute. The 
mediator is authorized to. ,conduct joint and separate meetings with 
the parties and to make oral and written recommendations for 
settlement. Whenever necessary, the mediator may also. o.btain 
expert advice concerning technical aspects of the dispute, provided 
that the parties agree,. Arrangements for obtaining such advice 
shall be made by the mediator or the parties, as the mediator shall 
determine. 
"The mediator may seek the agreement of the parties to 
resort to various methods of ADR including the following: 
"Open Door Pelicy - Employees are encouraged to meet 
with their immediate supervisor or manager to discuss problems 
arising out of the workplace environment. In this case, the mediator 
may request the presence of any person necessary to the 
resolution of the dispute. 
"Ombuds -
A neutral third party (either from within or 
outside the company) is designated to confidentially investigate and 
propose settlement of employment complaints 
brought by 
employees.' In this case, the mediator may engage a neutral third 
party to investigate the claims and render a non-binding finding 
thereon. 
"Internal Mediation''::' 'A process for resolving disputes in 
which a neutral third person from within the company, helps the 
disputing parties negotiate a mutually acceptable settlement. For 
this purpose, the mediator may request employees and/or 
managers from within the same company to help mediate the 
dispute. 


"Peer Review - A panel of employees (or employees and 
managers) works together to resolve employment complaints. In 
this regard, mediators may request employees and/or managers 
from other companies to investigate the dispute and render non-
binding findings thereon. 
"Mediators shall endeavour to involve employees and 
managers who are from the same or similar industry. In all cases, 
mediators shall take all necessary steps to preserve the 
confidentiality of the dispute. Employees are encouraged to meet 
with their 
"The mediator is authorized to end the mediation upon the 
execution of a settlement agreement by the parties which shall be 
duly attested by the mediator. Any settlement reached by the 
parties duly attested by the mediator shall be immediately binding 
between the parties and may be enforced and executed as 
provided according to Article 221. 
"The mediator is authorized to end the mediation by a written 
declaration of a party or parties to the effect that the mediation 
proceedings are terminated or whenever, in the judgment of the 
mediator, further efforts at mediation would not contribute to a 
resolution of the dispute between the parties. 
"5. Privacy. Mediation sessions are private. The parties and 
their representatives may attend mediation sessions but other 
persons may attend only with the permission of the parties and with 
the consent of the mediator. 
"6. 
Confidentiality. 
Mediation 
proceedings 
shall 
be 
considered confidential and information obtained therein shall not 
be published or disclosed to third parties except (i) with the consent 
of the parties, or (ii) when necessary in cases where the dispute is 
referred to arbitration or where resort to the Supreme Court under 
Article 220. 
"The confidentiality of the proceedings shall include 
communications to or from the mediator and all records, reports, or 
other documents received by a mediator while serving in that 
capacity. Confidential information disclosed to a mediator by the 
parties or by witnesses in the course of the mediation shall not be 
divulged by the mediator. The mediator shall not be compelled to 
divulge such 
records or to testify in regard to the mediation in any 
adversary proceeding or judicial forum. 
"Any violation of the confidentiality of the proceedings shall 
be subject to the following sanctions: 
1) 
Without 
preJudiCe 
to 
the 
following 
paragraph, 
administrative action or proceeding to be conducted by the Board, 
with proper notice and hearing, for inhibition or prohibition from 
appearing as mediator, arbitrator, counselor representative for any 
party in any case before the Board for a period to be determined by 
the Board; 


2) if the violator is a professional, administrative/disciplinary 
action before the appropriate authority, including the Supreme 
Court and Professional Regulation Commission (PRC), at the 
instance of any party or of the Board. 
SEC. 8. Referral to Arbitration. Article 217 of the Labor 
Code shall be repealed and replaced as follows: 
Article 217. Referral to Arbitration. In case of failure of mediation, the 
mediator shall accomplish a report to this effect and automatically refer the case 
to Arbitration, except if all parties express in writing their refusal to arbitrate. In 
case any of the parties fail or refuse to participate in the mediation, the 
participating parties can choose to declare a failure of mediation, in which case 
such participating parties can decide either to refuse or proceed to arbitration. 
For purposes of this Title, there is a failure of mediation in any of the 
following cases: 
(1) Where parties fail to reach an amicable settlement after the lapse of 
sixty (60) calendar days from the date of the initial mediation conference; 
(2) Regardless of paragraph (I), where any party necessary to reach a 
complete settlement of the claim fails or refuses to participate in the 
mediation; or 
u', , .J 
(3) Regardless of paragraph (I), where the mediator reaches the 
conclusion that the parties will not reach an amicable settlement or that 
further efforts at mediation are no longer worthwhile. 
In all cases, there may be a failure of mediation with regard only some or 
not all of the claims brought to mediation. In this case, failure of mediation may 
be declared only with regard the unresolved claims. 
SEC. 9. Arbitration. Article 218 of the Labor Code shall be repealed and 
replaced as follows: 
"Article 218. A. Start of Arbitration. Arbitration is deemed 
commenced from the time that the Board issues a report declaring 
a failure of mediation, except in cases where all parties or, in 
appropriate cases, participating parties decide not to proceed to 
arbitration. 
"B. Number of Arbitrators. The parties may agree on the 
number of arbitrators which shall be one (1) or three (3). If the 
parties cannot agree on the number of arbitrators or in case any 
party fails or refuses to participate in the proceedings, the Board 
shall consider the nature and complexity of the case in determining 
whether to assign one or three 'arbitrators to the dispute. 
"C. Selection of Arbitrator. 
1. Arbitrator of Choice. If there is to be only one (1) 
arbitrator, the person freely chosen by all the parties shall arbitrate 
the claims, provided that su~h person remains in good standing in 


the Department's official list of arbitrators. 
If the claim is to be 
referred to three (3) arbitrators, the claimant shall name one (1) 
arbitrator and the respondent shall name one (1) arbitrator. The 
third arbitrator who shall serve as the Chairperson shall be chosen 
according to the procedure pertaining to no arbitrator of choice. All 
three (3) arbitrators should remain in good standing in the 
Department's official list of arbitrators. 
"2. No Arbitrator of Choice, If the parties cannot agree on an 
Arbitrator within five (5) days after the mediator determines a failure 
of mediation, the Board shall send to the parties a list of not less 
than nine (9) names of arbitrators in good standing in the 
Department's official list of arbitrators. Each name shall be 
accompanied by a brief statement of their respective qualifications 
and experience and their business or professional connections. The 
list shall be accompanied by a summons from the Board to appear 
at a meeting at which the 
parties shall be given an opportunity to select one (1) 
arbitrator of choice. In cases where a temporary or permanent 
injunction is prayed for, the Board shall immediately call the parties 
to a meeting at which the parties shall be given an opportunity to 
select three (3) arbitrators of choice. 
"At that meeting, if the parties still cannot identify a common 
choice, each party shall proceed to select the arbitrator in the 
following manner: 
1) The claimant shall strike out one name from the list. 
2) Then, the respondent shall strike out one name from the list. 
3) The process is repeated until only one name is left in the list. 
4) Such remaining person shall be the apPointed Arbitrator of the 
claim. 
"Any party who has been duly summoned to the meeting for 
the selection of arbitrators but fails to attend the meeting for any 
reason shall be bound by the choice of arbitrator made during that 
meeting. 
"3. Multiple Claimants with Common Claims. If there are 
more than one claimant but with similar or common claims, the 
claimants must choose one person among them to represent them 
in determining the arbitrator. For this purpose, the claimants may 
choose to be represented by counsel. 
"4. Multiple Respondents. In case there is more than one 
respondent against whom common claims are made, they must 
choose a person among them who will represent them in 
determining the arbitrator. 
"D. Acceptance of Appointment. The Arbitrator shall, 
before entering upon the duties of the office, sign a Statement 
which shall be filed with the Board and a copy thereof provided to 
each party. The statement shall include a sworn acceptance by the 
arbitrator of the particular case assigned to him and an oath to 
decide it according to the Constitution and the law. 


"E. Challenge of Arbitrators. (1) No later than ten (10) 
days after the identification of the arbitrator, all parties may jointly 
challenge the arbitrator by communicating their challenge to the 
Board in writing. Upon receipt of a joint challenge, the Board shall 
replace the arbitrator and a new one chosen in accordance with 
Article 218. 
"(2) No later than ten (10) days after the arbitrator has been 
identified, any party may challenge the arbitrator by communicating 
his challenge to the Board. in writing. Such challenge should be 
based on the grounds for disqualification specified under the Code 
of Conduct for Arbitrators formulated by the Secretary. Within ten 
(10) days of receiving the challenge, the Board shall replace the 
arbitrator or communicate the challenge to the other parties. Any of 
the other parties may oppose the challenge by written opposition 
addressed to the Board within ten (10) days from receipt of the 
communication regarding the challenge. It shall be absolutely 
mandatory for the Board to decide on the challenge within twenty 
five (25) days after receiving the challenge. 
"This decision shall be interlocutory and not appealable. If 
the 
retained, 
the 
arbitrator shall proceed 
with 
arbitration 
proceedings. If the arbitrator is arbitrator is replaced, the parties 
shall choose another arbitrator according to Article 218. In every 
case, any party may exercise the privilege of challenge only once, 
provided that for this purpose, multiple parties shall be considered 
as one party. 
SEC. 10. Arbitration Procedure. Article 219 of the Labor Code shall be 
repealed and replaced as follOWS: 
"Article 219. Procedure of Arbitration. 
"A. Disclosure. At the first hearing, the arbitrator shall 
disclose all information that might be relevant to preserving 
neutrality, including but not limited to service as an arbitrator in any 
past or pending case involving any of the parties and/or their 
representatives. The arbitrator'shall also disClose how Icing he will 
take to decide the case at hand subject to the limitations as to time 
under Article 220. 
"B. Determinations. At the first hearing, the arbitrator shall 
exert all efforts to explore and resolve matters that will expedite the 
arbitration proceedings. In particular, the arbitrator must determine 
the following: 
1. the issues to be arbitrated; 
2. the date, time, place and estimated duration of the 
successive hearings; 
3. the law, standards, 'i"ljles of evidence and burdens of 
proof that are to apply to the proceeding; 
4. the stipulations and declarations regarding facts, exhibits, 
witnesses and other issues; 
5. the names of witnesses (including expert witnesses), the 
scope of witness testimony, and witness exclusion; 
6. the need for a stenographic record; 


7. the form of the award; 
8. the allocation of attorney's fees and costs; 
9. any other issues relating to the subject or conduct of the 
arbitration; 
"C. Technical rules not binding on proceedings. - The 
arbitrator shall exercise complete control over all arbitration 
proceedings to ensure a speedy, adequate, and just disposition of 
the disputes and cases submitted to him for resolution. In any 
proceeding before the Board and any of its arbitrators, the rules of 
evidence prevailing in courts of law or equity shall not be controlling 
and arbitrators shall, consistent with due process and the 
provisions qf this Article, u~e every and all reasonable means to 
ascertain the facts in each case speedily and with utmost neutrality. 
"Unless all parties expressly agree in writing to do otherwise, 
the arbitrator shall require simultaneous submission of position 
papers to which shall be attached the affidavits of the parties' 
respective witnesses as well as such relevant documents which 
they shall identify to support their respective declarations. 
Thereafter, the parties shall be allowed to submit their respective 
replies accompanied by affidavits containing rebuttal testimony and 
supporting documents. 
"In all cases, the affidavits submitted by the parties shall 
constitute the direct testimonies of the persons who executed the 
same. All affiants may bel subjected to cross-examination, redirect, 
or re-cross examination by the arbitrator motu proprio or by any 
appropriate party upon motion. The affidavit of any affiant who fails 
to testify shall not be considered as competent evidence for the 
party presenting the affidavit. However, the adverse party may 
utilize the same for any admissible purpose. 
. 
"The parties may offer such evidence as is relevant and 
material to the dispute and shall produce such evidence as the 
arbitrator deems necessary to an understanding and determination 
of the dispute. The arbitrator shall have the authority to issue 
subpoenas duces tecum and subpoenas ad testificandum to 
require the production of documents, evidence, or persons to give 
testimony relevant to the dispute. He shall also have the authority 
to administer oaths to witnesses. 
All parties to the dispute must attend the arbitration 
proceedings on pain of contempt. The attendance of any third party 
or the exclusion of any witness from the proceedings shall be 
determined by the arbitrator. 
"D. Discovery. Throughout the proceedings, the arbitrator 
shall have the authority to order such discovery, by way of 
deposition, interrogatory, document production, or otherwise, as the 
arbitrator considers necessary to a full and fair exploration of the 
issues in dispute, consistent with the expedited nature of arbitration 
and applying suppletorily the pertinent provisions of the Rules of 
court. 
"E. Inspection or Investigation. An arbitrator finding it 
necessary to make an inspection or investigation in connection with 


the arbitration shall advise the parties thereof. The arbitrator shall 
set the date and time of the inspection and shall notify the parties 
accordingly. Any party who so desires may be present during the 
inspection or investigation. In the event that one or all parties are 
not present during the inspection or investigation, the arbitrator 
shall make an oral or written report to the parties and afford them 
an opportunity to comment. 
SEC. 11. Award. Article 220 of the Labor Code shall be repealed and 
replaced as follows: 
"Article 220. Award. Unless the parties expressly agree 
otherwise in writing, it shall be mandatory for the arbitrator to render 
an award within ninety (90) calendar days from the date of his 
acceptance of the arbitration. Failure on the part of the arbitrator to 
issue an award or decision within the stipulated period shall 
constitute sufficient ground to revoke his accreditation as an 
arbitrator. The award or decision of the arbitrator shall contain the 
facts and the law on which it is based. It shall be final and 
executory after ten (10) calendar days from receipt of the copy of 
the award or decision by the parties and may only be brought 
before the Supreme Court through a special civil action for 
certiorari. 
The 
arbitrator 
shall 
entertain 
no 
motion 
for 
reconsideration or appeal." 
" <u 
SEC. 12. Execution. Article 221 ofthe Labor Code shall be amended to 
read as follows: 
"Article 221. Execution. Settlement agreements or Arbitral 
awards resulting from mediation or arbitration proceedings in this 
Title may be enforced by any interested party by motion directed to 
the Board. Upon such motion, the Board, through the Executive 
Director or his authorized representative, may issue a writ of 
execution on a settlement agreement or arbitral award within five 
(5) years from the date it was reached or becomes final and 
executory, requiring the sheriff or authorized person of the Board to 
execute the settlement agreement or arbitral award. In any case, it 
shall be the duty of the responsible officer to immediately furnish 
the counsels of record and the parties with copies of said 
settlement agreement or arbitral award. Failure to comply with the 
duty prescribed herein shall subject such responsible officer to 
appropriate administrative sanctions." 
SEC. 13. Representation. Article 222 of the Labor Code shall be 
amended to read as follows: 
"Article 222. Representation. Parties should personally 
appear before the Board and any of its mediators or arbitrators 
provided that juridical persons may be represented by any person 
specially authorized in writing to do so proceeding before the Board 
or any of its mediators or arbitrators, non-lawyers shall be allowed 
to represent any party in the following cases: 
1) he is representing himself; 


2) he is representing a legitimate or registered corporation 
or belongs to a legitimate labor organization; 
3) he is authorized under the student practice rule under 
Rule 138-A of the Rules of court. 
'Within one year from the effectivity of this Act, the Secretary 
shall formulate the rules regarding the participation, representation, 
and appearance of paralegals in labor and industrial disputes, 
including the formulation of rules for the accreditation of such 
paralegals for these and other. purposes." 
SEC. 14. Injunctions. Article 223 of the Labor Code shall be repealed 
and replaced as follows: 
"Article 223. Injunctions. To enjoin or restrain any actual or 
threatened commission of any or all prohibited or unlawful acts or to 
require the performance of a particular act in any industrial or labor 
dispute 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 petition for injunction or petition for 
mandatory injunction may be filed with the Board and the same 
shall automatically be referred for arbitration to a panel of three (3) 
Arbitrators, chosen in accordance with Article 218, Provided, that 
no temporary or permanent injunction in any case involving or 
growing out of a industrial or labor dispute as defined in this Code 
shall be issued except upon a unanimous decision of the panel and 
only after the posting of the necessary bond and hearing the 
testimony of witnesses, with opportunity for cross-examination, in 
support of the allegations of a complaint made under oath and 
testimony in opposition thereto, if offered. 
"Such hearing shall be held after due and personal notice 
thereof has been served, in such manner as the Board 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 complainant's property: provided, 
however, that if the party praying for a restraining order or 
injunction shall also allege that, unless a temporary restraining 
order shall be issued without notice, a substantial and irreparable 
injury to complainant3 property will be unavoidable, such a 
temporary restraining order may be issued upon testimony under 
oath, sufficient, if sustained, to justify the Board in issuing a 
temporary injunction upon hearing after notice and only after both 
parties are given ample opportunity to cross examine one another's 
witnesses. Such a temporary restraining order shall be effective for 
no longer than ten (10) days and shall become void at the 
expiration of said ten (10) days. 
"No such temporary restraining order or temporary injunction 
shall be issued except on condition that the petitioning party shall 
first file an undertaking with adequate security in an amount to be 
fixed by the Board sufficient 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 
Board. 
"The undertaking herein mentioned shall be understood to 
constitute an agreement entered into by the party seeking an 
injunction and the surety upon which an order may be rendered in 
the same suit or proceeding against said party and surety, upon a 
hearing to assess damages, of which hearing, the party seeking an 
injunction and surety shall have reasonable notice, the said party 
and surety submitting themselves to the jurisdiction of the Board for 
that purpose. But nothing herein contained shall deprive any party 
having a claim or cause of action under or upon such undertaking 
from electing to pursue his ordinary remedy by suit at law or in 
equity: provided, further, that the reception of evidence for the 
application of a writ of injunction may be delegated by the Board to 
any panel consisting of three (3) Arbitrators chosen according to 
Article 218 who shall conduct such hearings in such places as he 
may determine to be accessible to the parties and their witnesses 
and shall submit thereafter his recommendation to the Board." 
SEC. 15. Grievance Machinery. Article 260 of the Labor Code shall be 
amended as follows: 
"ART. 260. Grievance machinery and voluntary arbitration. -
The parties to a Colleq~,ive,Bargaining Agreement shall include 
therein provisions that will ensure the mutual' observance of its 
terms and conditions. They shall establish a machinery for the 
adjustment and 
resolution 
of grievances arising from the 
interpretation or implementation of their Collective Bargaining 
Agreement and those arising from the interpretation or enforcement 
of company personnel poliCies. 
All grievances submitted to the grievance machinery which 
are not settled within seven (7) calendar days from the date of its 
submission shall automatically be referred to THE BOARD FOR 
MEDIATION. 
. 
[For this purpose, parties to a Collective Bargaining 
Agreement shall name and designate in advance a Voluntary 
Arbitrator or panel of Voluntary Arbitrators, or include in the 
agreement a procedure for the selection of such Voluntary 
Arbitrator or panel of Voluntary Arbitrators, preferably from the 
listing of qualified Voluntary Arbitrators duly accredited by the 
Board. In case the parties fail to select a Voluntary Arbitrator or 
panel of Voluntary Arbitrators, the Board shall designate the 
Voluntary Arbitrator or panel of Voluntary Arbitrators, as may be 
necessary, pursuant to the selection procedure agreed upon in the 
Collective Bargaining Agreement, which shall act with the same 
force and effect as if the Arbitrator or panel of Arbitrators has been 
selected by the parties as described above.]" 
SEC. 16. Abolition of the National Labor Relations Commission and 
the National Conciliation and Mediation Board. The existing National Labor 
Relations Commission and National Conciliation and Mediation Board are hereby 


, , 
abolished. All unexpended funds, properties, equipment and records of the 
NLRC and NCMB, and such of its personnel as may be necessary, as 
determined by the Secretary of Labor and Employment, are hereby transferred to 
the Board and to its regional branches. Personnel not absorbed by or transferred 
to the Board shall enjoy benefits granted under existing laws. 
SEC. 17. Disposition of Pending Cases. All cases pending before the 
NLRC on the date of effectivity of this code shall be transferred to and processed 
by the Board created under this law having cognizance of the same in 
accordance with the procedure laid down herein and its implementing rules and 
regulations. 
SEC. 18. Personnel whose Services are Terminated. NLRC personnel 
whose services are terminated as a result of the implementation of this law shall 
enjoy the rights and protection provided under civil service law, rules and 
regulations. 
SEC. 19. Separability Provisions. If any provision of this law or the 
application thereof to any person or circumstance, is held invalid, the remainder 
of this law, or the application of such provision or part to other persons or 
circumstances, shall not be affected thereby. 
SEC. 20. Repealing Cla~s~. ,Articles 223,224,225,226,227,233,261, 
262, 262-A and 262-8 of the Labor Code as amended are hereby expressly 
repealed. All other provisions of existing laws, orders, decrees, rules and 
regulations inconsistent herewith are hereby repealed. 
SEC. 21. Effectivity. This Act shall take effect fifteen (15) days after its 
publication in the Official Gazette or in at least two (2) newspapers of general 
circulation. 
Approved,