… this Court had occasion to reiterate management’s prerogative to close or abolish a department or section of the employer’s establishment for economic reasons. We reasoned out that since the greater right to close the entire establishment and cease operations due to adverse economic conditions is granted an employer, the closure of a part thereof to minimize expenses and reduce capitalization should also be recognized.

 Dangan v. Tierra Factors Corporation, G.R. No. 63127-28, 20 February 1984

Consumer Product and Service Warranties

Applicable law on warranties under the Consumer Act

The provisions of the Civil Code on conditions and warranties primarily govern all contracts of sale with conditions and warranties.[1] The Consumer Act provides for additional rules on warranties as provided below.

Rules on Warranties
Consumer Code

In addition to the Civil Code provisions on sale with warranties, the following provisions are to govern the sale of consumer products with warranty:[2] 

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Extent of Joint and Solidarily Liability in Contracting or Subcontracting

The joint and several liability of the employer or principal was enacted to ensure compliance with the provisions of the Code, principally those on statutory minimum wage. The contractor or subcontractor is made liable by virtue of his or her status as a direct employer, and the principal as the indirect employer of the contractors employees. This liability facilitates, if not guarantees, payment of the workers compensation, thus, giving the workers ample protection as mandated by the 1987 Constitution. This is not unduly burdensome to the employer. Should the indirect employer be constrained to pay the workers, it can recover whatever amount it had paid in accordance with the terms of the service contract between itself and the contractor.

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Regulation of practices relative to weights and measures

Sealing and testing of instruments of weights and measures

All instruments for determining weights and measures in all consumer related transactions are required to be tested, calibrated, and sealed every six  months by the official sealer who must be the provincial, city, municipal treasurer (or his authorized representative) upon payment of fees required under existing law.[1] Such instruments are to be continuously inspected for compliance with the provisions of the law.[2]

Best Legal Practices

Obtain seal from the concerned local government unit – Businesses engaged in weighing and measuring consumer related transactions should obtain the official seal from the concerned local government unit. Thereafter, such seal should never be tampered as the same will be inspected regularly.

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Employee’s consent to retrenchment: DOLE notice not necessary

By the same token, if an employee consented to his retrenchment or voluntarily applied for retrenchment with the employer due to the installation of labor-saving devices, redundancy, closure or cessation of operation or to prevent financial losses to the business of the employer, the required previous notice to the DOLE is not necessary as the employee thereby acknowledged the existence of a valid cause for termination of his employment.

– International Hardware, Inc. v. Pedroso, G.R. No. 80770, 10 August 1989