Labor Law Digest 3

FRANCISCO vs. NLRC [GR. No.170087 Aug. 31, 2006] Facts: Angelina Francisco has held several positions in Kasei Corporation, to wit: (1) Accountant and Corporate Secretary; (2) Liaison Officer to the City of Makati; (3) Corporate Secretary; and (4)Acting Manager. She performed the work of Acting Manager for five years but later she was replaced by Liza R. Fuentes as Manager. Then, Kasei Corporation reduced her salary and was not paid her mid-year bonus allegedly because the company was not earning well. She made repeated follow-ups with the company cashier but she was advised that the company was not earning well. Ultimately, she did not report for work and filed an action for constructive dismissal before the labor arbiter. Issue: Was Francisco an employee of Kasei Corporation? Held: In certain cases where the control test is not sufficient to give a complete picture of the relationship between the parties, owing to the complexity of such a relationship where several positions have been held by the worker. There are instances when, aside from the employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished, economic realities of the employment relations help provide a comprehensive analysis of the true classification of the individual, whether as employee, independent contractor, corporate officer or some other capacity. The better approach would therefore be to adopt a two-tiered test involving: (1) the putative employer’spower to control the employee with respect to the means and methods by which the work is to be accomplished; and (2) the underlying economic realities of the activity or relationship. This two-tiered test would provide us with a framework of analysis, which would take into consideration the totality of circumstances surrounding the true nature of the relationship

G.R. 111501 Case Digest G.R. No. 111501, March 5, 1996 Phil. Fuji Xerox Corp., Jennifer Bernardo and Atty. Victorino Luis, petitioners vs NLRC Ponente: Mendoza Facts: This is a petition for certiorari to set aside the decision of NLRC finding Fuji guilty of illegally dismissing privated respondent Pedro Gerado and ordering him reinstated. NLRC reversed the decision of Labor Arbiter finding Gerado to be an employee of another firm (Skillpower). May 1977, Fuji entered into an agreement under Skillpower to operate copier machines of Fuji in its sales offices where Gerado was assigned as key operator. February 1983, Gerado went on leave and his place was taken by a substitute. He returned March and discovered that there was a apoilage of over 600 copies. He tried to talk to the service techinician of Fuji to stop the meter of the machine but was refused. Fuji then knew about the incident and reported to Skillpower. Skillpower wrote a letter to Gerado asking for explaination and suspended him from work. Gerado then filed for illegal dismissal. Labor Arbiter found that Gerado applied for work to Skillpower and was made to sign a contract. Although he receives his salaries from Fuji, Skillpower exercises control and supervision over his wrk. Labor arbiter then held the decision that Gerado was an employee of Skillpower. NLRC found Gerado to be an employee of Fuji and was illegally dismissed. NLRC found that Skillpower acted on behalf of Fuji in supervising his work, and that FUji paid his salaries and Skillpower was just a paymaster-agent. Here, Fuji petitions that Skillpower is an independent contractor and Gerado is its employee: (1) Gerado was recruited by Skillpower, (2) work done by Gerado was not necessary to the conduct of business of Fuji, (3) Gerado's salaries and benefits were paid directly by Skillpower, (4) Gerado worked under the control of

Skillpower and (5) Skillpower is a highly-capitalized business venture. Issue: (1) Whether Gerado is an employee of Fuji or of Skillpower. Ruling: Contentions are without merit. Gerado is en employee of Fuji. (1) Gerado was recruited by Skillpower to be assigned at Fuji. With a contract between Gerado and Fuji as basis. (2) The job of Gerado may not generate income directly to Fuji but it is necessary in their products and promotion of the company's public image. (3) The letters of the legal and industrial relations officer of Fuji and the union president played the dismissal of the employee, the order of dismissal was issued as a mere obedience to the decision of petitioner. (4) The service being rendered by privated respondent was not a specific or special skill that Skillpower was in the business of providing. Skillpower is classified under Article 106 of the Labor Code; where there is "labor only" where the person supplying workers to an employer does not have suubstantial capital or investment in the forms of tools, equipment, etc. and workers recruited and placed are performing activities directly related to the principal employer. Skillpower merely supplied workers to Fuji. (5) There is an agreement between Fuji and Skillpower that Skillpower has no control over the workers they supplied with Fuji.

G.R. No. 83402 Case Digest G.R. No. 83402, October 6, 1997 Algon Engineering Const. Corp. and Alex Gonzales, petitioners vs NLRC and Jose Espinosa, respondents Ponente: Hermosisima Facts: This is a petition for certiorari assailing the resolution of NLRC dismissing their appeal and denying their motion for reconsideration and affriming the Labor arbiter's findings that Espinosa is an employee of Algon. Algon as standard operating procedure of their construction business entered into a lease of contract with Espinosa for the storage and parking of their heavy equipment in exchange for a storage or parking fee.

29 April 2005 / Labor Standards Employee-employer Relationship in a Publication – Bond Requirement When Employer Appeals in a Labor Case Orozco v CA FACTS: Orozco was hired as a writer by the Philippine Daily Inquirer in 1990. She was the columnist of “Feminist Reflections” under the Lifestyle section of the publication. She writes on a weekly basis and on a per article basis (P250-300/article). In 1991, Magsanoc as the editor-in-chief sought to improve the Lifestyle section of the paper. She said there were too many Lifestyle writers and that it was time to reduce the number of writers. Orozco’s column was eventually dropped.

Espinosa claims that he was hired by Algon to be a watchman with the duty of guarding the heavy equipment in other house spaces his area from 6pm to 6am. This was affirmed by Labor arbiter, finding that Algon pays Espinosa P20 on a daily basis as watchman.

Orozco filed for a case for Illegal Dismissal against PDI and Magsanoc. Orozco won in the Labor Arbiter. The LA ruled that there exists an employer-employee relationship between PDI and Orozco hence Orozco is entitled to receive backwages, reinstatement, and 13th month pay.

Algon then appealed to the NLRC, arguing that Algon did not hire Espinosa, the relationship is merely that of leased storage or parking space. But NLRC affirmed the Labor Arbiter on the same basis.

PDI appealed to the National Labor Relations Commission. The NLRC denied the appeal because of the failure of PDI to post a surety bond as required by Article 223 of the Labor Code. The Court of Appeals reversed the NLRC.

Ruling: Petition with no merit.

ISSUE: Whether or not there exists an employer-employee relationship between PDI and Orozco. Whether or not PDI’s appeal will prosper.

(1) Cash vouchers issued by Algon as payment to Espinosa illustrate that Espinosa was paid not only for the storage and parking in his premisess but also with the other storage of Algon. (2) Algon's memorandum issued to Espinosa citing him for the loss of 4 batteries is sufficient to prove the existence of en employeremployee relationship as well. The two evidence fulfilling the elements of employer-employee relationship: (1) selection and engagement of the employee; (2) payment of wages; (3) power of dismissal; and (4) employer's own power to control employee's conduct.

HELD: Under Article 223 of the Labor Code: ART. 223. Appeal. – Decisions, awards or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt of such decisions, awards, or orders. In case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Commission in the amount equivalent to the monetary award in the judgment appealed from. The requirement that the employer post a cash or surety bond to perfect its/his appeal is apparently intended to assure the workers

that if they prevail in the case, they will receive the money judgment in their favor upon the dismissal of the employer’s appeal. It was intended to discourage employers from using an appeal to delay, or even evade, their obligation to satisfy their employees’ just and lawful claims. But in this case, this principle is relaxed by the Supreme Court considering the fact that the Labor Arbiter, in ruling that the Orozco is entitled to backwages, did not provide any computation. The case is then remanded to the Labor Arbiter for the computation. This necessarily pended the resolution of the other issue of whether or not there exists an employer-employee relationship between PDI and Orozco.

GR NO. 165881 APRIL 19, 2006 OSCAR VILLAMARIA, JR. (Petitioner) Vs. COURT OF APPEALS AND JERRY V. BUSTAMANTE, (respondents)

Caurdanetaan Piece Workers’ Union v. Laguesma Facts: This case consists of 2 consolidated cases.

any third-party independent contractor. It also wielded the power of dismissal over petitioners; in fact, its exercise of this power was the progenitor of the Second Case. Clearly, the workers are not independent contractors.

FACTS: Petitioner was the owner of the jeepneys which the private respondent is the one who is driving in a “boundary basis”. Villamaria and Bustamante entered into a contract were the petitioner agreed to sell the jeepney entitled “Kasunduan ng Bilihan ng Sasakayan sa Pamamagitan ng Boundary-Hulog” were Bustamante would remit to Villamaria P550.00 a day for a period of four years. Both parties agreed in such terms and stipulations of the contract.When the private respondent failed to pay the boundary-hulog, Villarama took back the jeepney driven by Bustamante and barred the latter from driving the vehicle. Due to the action of petitioner, Bustamante files a complaint before the court.

The first case is an appeal from the decision of Laguesma, as Undersecretary of Labor, in the Petition for Certification Election filed by petitioner-union. The Caurdenataan Piece Workers’ Union is composed of the “employees” of Corfarm Grains, Inc. They work as cargadores in the said company and were paid on a piece rate basis. The said union was organized when some of their benefits were not given to them. Thus, they filed their petition for certification election. The Med-Arbiter granted the petition but this decision was reversed, on appeal, by Laguesma saying that there was no employer-employee relationship existing.

ISSUE: Whether employer-employee relations exists. HELD: The juridical relationship of employer-employee between petitioner and respondent was not negated by the foregoing stipulation in the Kasunduan, considering that petitioner retained control of respondent’s conduct as driver of the vehicle. Even if the petitioner was allowed to let some other person drive the unit, it was not shown that he did so; that the existence of an employment relation is not dependent on how the worker is paid but on the presence or absence of control over the means and method of the work; that the amount earned in excess of the “boundary hulog” is equivalent to wages; and that the fact that the power of dismissal was not mentioned in the Kasunduan did not mean Villamaria never exercised such power, or could not exercise such power. Hence, the employer- employee relationship exists.

The second case involves a complaint for illegal dismissal against Corfarm. This arose because those workers who joined the said union were replaced with non-members. As to this case, the labor arbiter first ruled in favor of the workers but subsequently, the NLRC reversed such ruling. Issue: Whether or not there was an employer-employee relationship between the cargadores and Corfarm. Held: YES. To determine the existence of an employer-employee relation, this Court has consistently applied the “four-fold” test. It is undeniable that petitioner’s members worked as cargadores for private respondent. They loaded, unloaded and piled sacks of palay from the warehouses to the cargo trucks and from the cargo trucks to the buyers. This work is directly related, necessary and vital to the operations of Corfarm. Moreover, Corfarm did not even allege, much less prove, that petitioner’s members have “substantial capital or investment in the form of tools, equipment, machineries, [and] work premises, among others.” Furthermore, said respondent did not contradict petitioner’s allegation that it paid wages directly to these workers without the intervention of

It does not matter that the workers also work for other companies because this is just their way of coping with their daily expenses. No particular form of proof is required to prove the existence of an employer-employee relationship. Any competent and relevant evidence may show the relationship. If only documentary evidence would be required to demonstrate that relationship, no scheming employer would ever be brought before the bar of justice.

Doctrine: To determine the existence of an employer-employee relation, this Court has consistently applied the “four-fold” test which has the following elements: (1) the power to hire, (2) the payment of wages, (3) the power to dismiss, and (4) the power to control -- the last being the most important element.

Dy Keh Beng v. International Labor G.R. No. L-32245 May 25, 1979 DY KEH BENG, petitioner, vs. INTERNATIONAL LABOR and MARINE UNION OF THE PHILIPPINES, ET AL., respondents. Facts: A charge of unfair labor practice was filed against Dy Keh Beng, proprietor of a basket factory, for discriminatory acts within the meaning of Section 4(a), sub-paragraph (1) and (4). Republic Act No. 875, by dismissing on September 28 and 29, 1960, respectively, Carlos N. Solano and Ricardo Tudla for their union activities. After preliminary investigation was conducted, a case was filed in the Court of Industrial Relations for in behalf of the International Labor and Marine Union of the Philippines and two of its members, Solano and Tudla In his answer, Dy Keh Beng contended that he did not know Tudla and that Solano was not his employee because the latter came to the establishment only when there was work which he did on pakiaw basis, each piece of work being done under a separate contract. Moreover, Dy Keh Beng countered with a special defense of simple extortion committed by the head of the labor union, Bienvenido Onayan. According to Dy Keh Beng, however, Solano was not his employee for the following reasons: (1) Solano never stayed long enought at Dy's establishment; (2) Solano had to leave as soon as he was through with the (3) order given him by Dy; (4) When there were no orders needing his services there was nothing for him to do; (5) When orders came to the shop that his regular workers could not fill it was then that Dy went to his address in Caloocan and fetched him for these orders; and (6) Solano's work with Dy's establishment was not continuous. Issue: Whether there existed an employee-employer relation between petitioner Dy Keh Beng and the respondents Solano and Tudla.

Ruling: The Hearing Examiner prepared a report which was subsequently adopted in toto by the Court of Industrial Relations. An employeeemployer relationship was found to have existed between Dy Keh Beng and complainants Tudla and Solano, although Solano was admitted to have worked on piece basis. According to the Hearing Examiner, the evidence for the complainant Union tended to show that Solano and Tudla became employees of Dy Keh Beng from May 2, 1953 and July 15, 1955, respectively, and that except in the event of illness, their work with the establishment was continuous although their services were compensated on piece basis. Evidence likewise showed that at times the establishment had eight (8) workers and never less than five (5); including the complainants, and that complainants used to receive P5.00 a day. Sometimes less. The award of backwages granted by the Court of Industrial Relations is herein modified to an award of backwages for three years without qualification and deduction at the respective rates of compensation the employees concerned were receiving at the time of dismissal. The execution of this award is entrusted to the National Labor Relations Commission. Costs against petitioner.

G.R. No. 119205, April 15, 1998 Sime Darby Pilipinas, Inc. petitioner, vs NLRC and Sime Darby Salaried Employees Assoc., respondents Ponente: Bellosillo Issue: Is the act of management in revising the work schedule of its employees and discarding their paid lunch break constitutive of unfair labor practice? Facts: Sime Darby is engaged in the manufacture of automotive tires, tubes and other rubber products. Private respondent is an association of the monthly salaried employees of the Sime Darby factory workers in Marikina. Prior to the controversy, all employees of Sime Darby worked from 7:45am to 3:45pm with a 30-minute paid "on call" lunch break. On August 14, 1992, the company issued a memorandum to all factory employees advising all its monthly salaried employees in Marikina Tire plant except those in the warehouse and Quality Assurance Dept., of a change in work schedules. (M-F, 7:45am4:45pm and Sat 7:45am-11:45am) with cofee break of 10 minutes between 9:30am-10:30am and 2:30pm-3:30pm and lunch break between 12nn-1pm(M-F). Because of this memorandum, the association filed a complaint in behalf of its members a complaint with labor Arbiter for unfair labor practice, discrimination and evasion of liability. However, the labor arbiter dismissed the complaint on the grounds that the elimination of the 30 minute paid lunch break constituted a valid exercise of management prerogative and that the new work schedule did not have the effect of dimishing the benefits for the work did not exceed 8 hours. Labor arbiter added that it would be unjust if they continue to be paid during their lunch break even if they are no longer on call or required to work during the break. The association appealed to the NLRC but NLRC has affirmed the labor arbiter's decision and dismissed the appeal. However, in the motion for reconsideration, NLRC having two new commissioners has reversed the earlier decision. Stating that,the public respondent declared that the new work schedule deprived the employees of the benefits of a time-honored company practice of

providing its employees a 30-minute paid lunch break resulting in an unjust diminution of company privileges prohibited by Art. 100 of the Labor Code, as amended. Ruling: The Office of the Solicitor General filed in a lieu of comment a manifestation and motion recommending that the petitioner be granted, alleging that the 14 August 1992 memorandum which contained the new work schedule was not discriminatory of the union members nor did it constitute unfair labor practice on the part of petitioner. We agree, hence, we sustain petitioner. The right to fix the work schedules of the employees rests principally on their employer. In the instant case petitioner, as the employer, cites as reason for the adjustment the efficient conduct of its business operations and its improved production. The case before us does not pertain to any controversy involving discrimination of employees but only the issue of whether the change of work schedule, which management deems necessary to increase production, constitutes unfair labor practice. As shown by the records, the change effected by management with regard to working time is made to apply to all factory employees engaged in the same line of work whether or not they are members of private respondent union. Hence, it cannot be said that the new scheme adopted by management prejudices the right of private respondent to self-organization. Management is free to regulate, according to its own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of work, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay off of workers and discipline, dismissal and recall of workers. Further, management retains the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. So long as such prerogative is exercised in good faith for the advancement of the employer's interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold such exercise. Petition granted.

Full Text EDUARDO B. PRANGAN, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION (NLRC), MASAGANA SECURITY SERVICES CORPORATION, and/or VICTOR C. PADILLA, respondents. DECISION ROMERO, J.: Private respondent, a corporation engaged in providing security services to its client, hired petitioner on November 4, 1980 as one of its security guards. Thereafter, he was assigned to the Cat House Bar and Restaurant with a monthly salary of P2,000.00 until its closure on August 31, 1993. On May 4, 1994, petitioner filed a complaint[1] against private respondent for underpayment of wages, non-payment of salary from August 16-31, 1993, overtime pay, premium pay for holiday, rest day, night shift differential, uniform allowance, service incentive leave pay and 13th month pay from the year 1990 to 1993. Private respondent, in its position paper,[2] rejected petitioner’s claim alleging it merely acted as an agent of the latter in securing his employment at the Cat House Bar and Restaurant. Thus, the liability for the claims of the petitioner should be charged to Cat House Bar and its owner, being his direct employer. In resolving the dispute in a decision dated May 31, 1995,[3] the Labor Arbiter brushed aside the private respondent’s contention that it was merely an agent of the petitioner and concluded: “WHEREFORE, PREMISES CONSIDERED, respondents MASAGANA SECURITY SERVICE CORPORATION and/or VICTOR C. PADILLA are hereby ORDERED to pay within ten (10) days from receipt hereof herein complainant EDUARDO B. PRANGAN, the total sum of Nine Thousand Nine Hundred Thirty Two Pesos & Sixteen Centavos (P9,932.16) premium pay for holiday and rest days, night shift differential, service incentive leave pay, 13th month pay, uniform allowance, and unpaid salary. Complainant’s other claims as well as respondents’ counter claim are hereby DISMISSSED either for the reason of prescription and/or lack of merit.

SO ORDERED.” Apparently not satisfied with the above-mentioned monetary award, petitioner appealed to the National Labor Relations Commission (NLRC) contending that the Labor Arbiter erred in concluding that he only worked for four hours and not twelve hours a day. Evidently, the shorter work hours resulted in a lower monetary award by the Labor Arbiter. However, the NLRC dismissed his appeal for failure to file the same within ten-day reglementary period.[4] Undaunted, petitioner filed a motion for reconsideration which, in the “interest of justice,” was favorably granted by the NLRC resulting in the reinstatement of his appeal. Nonetheless, petitioner’s victory was short-lived as the NLRC eventually dismissed his appeal for lack of merit,[5] the dispositive portion of the decision reads: “WHEREFORE, the appeal is hereby dismissed for lack of merit and decision is affirmed in toto. SO ORDERED.” Petitioner is now before us imputing grave abuse of discretion on the part of respondent NLRC (a) declaring that he rendered only four hours and not twelve hours of work, and (b) affirming the monetary award. The public respondent, through the Solicitor General, and the private respondent filed their respective comments on the petition refuting the allegation of the petitioner. Specifically, they asserted that the decision was supported by ample evidence showing that petitioner indeed worked for only four hours and not twelve hours a day. A review of the alleged error raised by the instant petition leads us to conclude that the same is factual in nature which, as a rule, we do not pass upon. As a general rule, it is not for us to correct the NLRC’s evaluation of the evidence, as our task is confined to issues of jurisdiction or grave abuse of discretion.[6] Obviously, however, the same will not apply where the evidence require a reversal or modification.[7]

As proof of petitioner’s actual hours of work, private respondent submitted the daily time records allegedly signed by the petitioner himself showing that he only worked four hours daily.

We find merit in the petition.

Private respondent hardly bothered to controvert petitioner’s assertion, much less bolster its own contention. As petitioner’s employer, private respondent has unlimited access to all relevant documents and records on the hours of work of the petitioner. Yet, even as it insists that petitioner only worked for four hours and not twelve, no employment contract, payroll, notice of assignment or posting, cash voucher or any other convincing evidence which may attest to the actual hours of work of the petitioner were even presented. Instead, what the private respondent offered as evidence were only petitioner’s daily time record, which the latter categorically denied ever accomplishing, much less signing.

To be sure, findings of fact of quasi-judicial bodies like the NLRC, particularly when they coincide with those of the Labor Arbiter, are accorded with respect even finality if supported by substantial evidence.[8] In this regard, we have defined substantial evidence as such amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion.[9] Absent such quantum of evidence, the Court is not precluded from making its own independent evaluation of facts.[10]

In said alleged daily time record, it showed that petitioner started work at 10:00 p.m. and would invariably leave his post at exactly 2:00 a.m. Obviously, such unvarying recording of a daily time record is improbable and contrary to human experience. It is impossible for an employee to arrive at the workplace and leave at exactly the same time, day in day out. The very uniformity and regularity of the entries are “badges of untruthfulness and as such indices of dubiety.[14]

In the instant case, there is no dispute that matters concerning an employee’s actual hours of work are within the ambit of management prerogative. However, when an employer alleges that his employee works less than the normal hours of employment as provided for in the law,[11] he bears the burden of proving his allegation with clear and satisfactory evidence.

Another consideration which militates against private respondent’s claim is the fact that in the personnel data sheet of the petitioner,[15] duly signed by the former’s operation manager, it shows on its face that the latter’s hours of work are from 7:00 p.m. to 7:00 a.m. or twelve hours a day. Hence, private respondent is estopped from assailing the contents of its own documents.

In the instant petition, the NLRC, in declaring that petitioner only worked for four hours, relied solely on the supposed daily time records of the petitioner submitted by the private respondent.[12] We, however, are of the opinion that these documents cannot be considered substantial evidence as to conclude that petitioner only worked for four hours. It is worth mentioning that petitioner, in his Sur-Rejoinder to Respondents’ Rejoinder,[13] unequivocably stated that:

Further, the attendance sheets of Cat House Bar and Restaurant[16] showed that petitioner worked from 7:00 p.m. to 7:00 a.m. daily, documents which were never repudiated by the private respondent.

In contrast, petitioner argues that these daily time records were falsified for the simple reason that he was not required to submit one. He further stressed that, assuming such documents exist, its authenticity and due execution are questionable and of doubtful source.

“Complainant (petitioner herein) never made nor submitted any daily time record with respondent company considering the fact that he was assigned to a single post and that the daily time records he allegedly submitted with respondent company are all falsified and his signature appearing therein forged.”

All told, private respondent has not adequately proved that petitioner’s actual hours of work is only four hours. Its unexplained silence contravening the personnel data sheet and the attendance sheets of Cat House Bar and Restaurant presented by the petitioner showing he worked for twelve hours, has assumed the character of an admission. No reason was proffered for this silence despite private respondent, being the employer, could have easily done so. As is well-settled, if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be

tilted in favor of the employee. Since it is a time-honored rule that in controversies between a laborer and his master, doubts reasonably arising from the evidence, or in the interpretation of agreements and writings should be resolved in the former’s favor.[17] WHEREFORE, in view of the foregoing, the instant petition is hereby GRANTED. Accordingly, the decision of the NLRC dated July 31, 1996 is hereby VACATED. Whatever money claims due to the petitioner shall be computed on the basis of a twelve-hour daily work schedule. For this purpose, the case is hereby REMANDED to the Labor Arbiter for immediate recomputation of said claims in accordance with the foregoing findings. No costs. SO ORDERED.

G.R. No. 123520, June 26, 1998 National Semiconductor Distribution, Ltd., petitioner, vs NLRC and Edgar Philip Santos, respondents Ponente: Bellosillo Issue: (1) Who has the burden of providing a claim for night shift differential pay, the worker who claims not to have been paid night shift differentials, or the employer in custody of pertinent documents which would prove the fact of payment of the same? (2) Were the requirements of due process substantially complied with in dismissing the worker? Facts: NSC a foreign corporation licensed to do business in the Phil. manufactures and assembles electronic parts for export in mactan, lapu-lapu city. Santos was employed by NSC as a technicioan in its special products group assigned to the graveyard shift from 10pm6am. On January 8, 1993 Santos did not report for work on his shift. He resumed his duties as night shift on January 9. However, at the end of his shift, he made 2 entries in his DTR to make it appear that he worked on both the 8th and 9th. His supervisor Limisiaco, received the report that there was no technician in the graveyard shift on January 8. Limsiaco then checked the DTRs and found out that Santos did not report on 8th and have found in the DTR the otherwise. Informal investigation were conducted by management and have required Santos to explain in writing why no disciplinary action should be taken against him for dishonesty, falsifying DTR and violation of company rules. Santos explain that he was sick on the 8th and his DTR was a mere oversight or carelessness on his part. Not satisfied with the explanation, NSC dismissed Santos for the violations made. Santos then filed a complaint for illegal dismissal and non-payment of wages and other money claims. Labor arbiter found that Santos was dismissed on legal grounds although he was not afforded due process, ordering NSC to indemnify him and the unpaid night shift differentials.

NSC appealed to NLRC, but NLRC affirmed the labor arbiter holding that the conclusions were sufficiently supported by the evidence.

Thus, it is clear the minimum requirements of due process have been fulfilled by petitioner.

NSC now imputes grave abuse of discretion to NLRC in affirming the labor arbiter. Contending that the night shift differentials were never raised as an issue nor pusued by Santos; also denied that Santos was not given due process because he was afforded ample opportunity to be heard.

Petition Dismissed.

Issues: (1) Was Santos illegally dismissed? (2) Santos entitled for the money claims? Ruling: The fact that Santos neglected to substantiate his claim for night shift differentials is not prejudicial to his cause. After all, the burden of proving payment rests on petitioner NSC. Santos' allegation of non-payment of this benefit, to which he is by law entitled, is a negative allegation which need not be supported by evidence unless it is an essential part of his cause of action. It must be noted that his main cause of action is his illegal dismissal, and the claim for night shift differential is but an incident of the protest against such dismissal. Thus, the burden of proving that payment of such benefit has been made rests upon the party who will suffer if no evidence at all is presented by either party. By choosing not to fully and completely disclose information to prove that it had paid all the night shift differentials due to private respondent, petitioner failed to discharge the burden of proof. On the issue of due process, we agree with petitioner that Santos was accorded full opportunity to be heard before he was dismissed. The essence of due process is simply an opportunity to be heard, or as applied to administrative proceedings, an opportunity to explain one's side. In the instant case, petitioner furnished private respondent notice as to the particular acts which constituted the ground for his dismissal. By requiring him to submit a written explanation within 48 hours from receipt of the notice, the company gave him the opportunity to be heard in his defense. Private respondent availed of this chance by submitting a written explanation. Furthermore, investigations on the incident were actually conducted. Finally, private respondent was notified on 14 January 1993 of the management's decision to terminate his services.

Full text G.R. No. 91298

June 22, 1990

CORAZON PERIQUET, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and THE PHIL. NATIONAL CONSTRUCTION CORPORATION (Formerly Construction Development Corp. of the Phils.), respondents. Tabaquero, Albano & Associates for petitioner. The Government Corporate Counsel for private respondent.

dated June 20, 1989, the corresponding writ of execution of June 26, 1989, and the notice of garnishment. 5 In its decision, the public respondent held that the motion for execution was time-barred, having been filed beyond the five-year period prescribed by both the Rules of Court and the Labor Code. It also rejected the petitioner's claim that she had not been reinstated on time and ruled as valid the two quitclaims she had signed waiving her right to reinstatement and acknowledging settlement in full of her back wages and other benefits. The petitioner contends that this decision is tainted with grave abuse of discretion and asks for its reversal. We shall affirm instead. Sec. 6, Rule 39 of the Revised Rules of Court, provides:

CRUZ, J.: It is said that a woman has the privilege of changing her mind but this is usually allowed only in affairs of the heart where the rules are permissibly inconstant. In the case before us, Corazon Periquet, the herein petitioner, exercised this privilege in connection with her work, where the rules are not as fickle. The petitioner was dismissed as toll collector by the Construction Development Corporation of the Philippines, private respondent herein, for willful breach of trust and unauthorized possession of accountable toll tickets allegedly found in her purse during a surprise inspection. Claiming she had been "framed," she filed a complaint for illegal dismissal and was sustained by the labor arbiter, who ordered her reinstatement within ten days "without loss of seniority rights and other privileges and with fun back wages to be computed from the date of her actual dismissal up to date of her actual reinstatement." 1 On appeal, this order was affirmed in toto by public respondent NLRC on August 29, 1980. 2 On March 11, 1989, almost nine years later, the petitioner filed a motion for the issuance of a writ of execution of the decision. The motion was granted by the executive labor arbiter in an order dated June 26, 1989, which required payment to the petitioner of the sum of P205,207.42 "by way of implementing the balance of the judgment amount" due from the private respondent. 3 Pursuant thereto, the said amount was garnished by the NLRC sheriff on July 12, 1989. 4 On September 11, 1989, however, the NLRC sustained the appeal of the CDCP and set aside the order

SEC. 6. Execution by motion or by independent action. — A judgment may be executed on motion within five (5) years from the date of its entry or from the date it becomes final and executory. After the lapse of such time, and before it is barred by the statute of limitations, a judgment may be enforced by action. A similar provision is found in Art. 224 of the Labor Code, as amended by RA 6715, viz. ART. 224. Execution of decision, orders, awards. — (a) The Secretary of Labor and Employment or any Regional Director, the Commission or any Labor Arbiter or Med-Arbiter, or the Voluntary Arbitrator may, motu propio, or on motion of any interested party, issue a writ of execution on a judgment within five (5) years from the date it becomes final and executory, requiring a sheriff or a duly deputized officer to execute or enforce a final decision, order or award. ... The petitioner argues that the above rules are not absolute and cites the exception snowed in Lancita v. Magbanua, 6 where the Court held: Where judgments are for money only and wholly unpaid, and execution has been previously withheld in the interest of the judgment debtor, which is in financial difficulties, the court has no discretion to deny motions for leave to issue execution more than five years after the judgments are entered. (Application of Molnar, Belinsky, et al. v. Long Is. Amusement Corp., I N.Y.S, 2d 866)

In computing the time limited for suing out of an execution, although there is authority to the contrary, the general rule is that there should not be included the time when execution is stayed, either by agreement of the parties for a definite time, by injunction, by the taking of an appeal or writ of error so as to operate as a supersedeas, by the death of a party, or otherwise. Any interruption or delay occasioned by the debtor will extend the time within which the writ may be issued without scire facias. xxx

xxx

xxx

There has been no indication that respondents herein had ever slept on their rights to have the judgment executed by mere motions, within the reglementary period. The statute of limitation has not been devised against those who wish to act but cannot do so, for causes beyond their central. Periquet insists it was the private respondent that delayed and prevented the execution of the judgment in her favor, but that is not the way we see it. The record shows it was she who dillydallied. The original decision called for her reinstatement within ten days from receipt thereof following its affirmance by the NLRC on August 29, 1980, but there is no evidence that she demanded her reinstatement or that she complained when her demand was rejected. What appears is that she entered into a compromise agreement with CDCP where she waived her right to reinstatement and received from the CDCP the sum of P14,000.00 representing her back wages from the date of her dismissal to the date of the agreement. 7 Dismissing the compromise agreement, the petitioner now claims she was actually reinstated only on March 16, 1987, and so should be granted back pay for the period beginning November 28, 1978, date of her dismissal, until the date of her reinstatement. She conveniently omits to mention several significant developments that transpired during and after this period that seriously cast doubt on her candor and bona fides. After accepting the sum of P14,000.00 from the private respondent and waiving her right to reinstatement in the compromise agreement, the petitioner secured employment as kitchen dispatcher at the Tito Rey Restaurant, where she worked from

October 1982 to March 1987. According to the certification issued by that business, 8 she received a monthly compensation of P1,904.00, which was higher than her salary in the CDCP. For reasons not disclosed by the record, she applied for reemployment with the CDCP and was on March 16,1987, given the position of xerox machine operator with a basic salary of P1,030.00 plus P461.33 in allowances, for a total of P1,491.33 monthly. 9 On June 27, 1988; she wrote the new management of the CDCP and asked that the rights granted her by the decision dated August 29, 1980, be recognized because the waiver she had signed was invalid. 10 On September 19, 1988, the Corporate Legal Counsel of the private respondent (now Philippine National Construction Corporation) recommended the payment to the petitioner of the sum of P9,544.00, representing the balance of her back pay for three years at P654. 00 per month (minus the P14,000.00 earlier paid). 11 On November 10, 1988, the petitioner accepted this additional amount and signed another Quitclaim and Release reading as follows: KNOW ALL MEN BY THESE PRESENTS: THAT, I CORAZON PERIQUET, of legal age, married and resident of No. 87 Annapolis St., Quezon City, hereby acknowledged receipt of the sum of PESOS: NINE THOUSAND FIVE HUNDRED FORTY FOUR PESOS ONLY (P9,544.00) Philippine currency, representing the unpaid balance of the back wages due me under the judgment award in NLRC Case No. AB-2-864-79 entitled "Corazon Periquet vs. PNCC- TOLLWAYS" and I further manifest that this payment is in full satisfaction of all my claims/demands in the aforesaid case. Likewise, I hereby manifest that I had voluntarily waived reinstatement to my former position as TOLL TELLER and in lieu thereof, I sought and am satisfied with my present position as XEROX MACHINE OPERATOR in the Central Office. Finally, I hereby certify that delay in my reinstatement, after finality of the Decision dated 10 May 1979 was due to my own fault and that PNCC is not liable thereto.

I hereby RELEASE AND DISCHARGE the said corporation and its officers from money and all claims by way of unpaid wages, separation pay, differential pay, company, statutory and other benefits or otherwise as may be due me in connection with the above-entitled case. I hereby state further that I have no more claims or right of action of whatever nature, whether past, present, future or contingent against said corporation and its officers, relative to NLRC Case No. AB-2-864-79. IN WITNESS WHEREOF, I have hereunto set my hand this 10th day of November 1988 at Mandaluyong, Metro Manila. (Emphasis supplied.) 12 The petitioner was apparently satisfied with the settlement, for in the memorandum she sent the PNCC Corporate Legal Counsel on November 24, 1988, 13 she said in part: Sir, this is indeed my chance to express my gratitude to you and all others who have helped me and my family enjoy the fruits of my years of stay with PNCC by way of granting an additional amount of P9,544.00 among others ... As per your recommendation contained therein in said memo, I am now occupying the position of xerox machine operator and is (sic) presently receiving a monthly salary of P2,014.00. Reacting to her inquiry about her entitlement to longevity pay, yearly company increases and other statutory benefits, the private respondent adjusted her monthly salary from P2,014.00 to P3,588.00 monthly. Then the lull. Then the bombshell. On March 11, 1989, she filed the motion for execution that is now the subject of this petition. It is difficult to understand the attitude of the petitioner, who has blown hot and cold, as if she does not know her own mind. First she signed a waiver and then she rejected it; then she signed another waiver which she also rejected, again on the ground that she had been deceived. In her first waiver, she acknowledged full settlement of the judgment in her favor, and then in the second waiver, after accepting additional payment, she again

acknowledged fun settlement of the same judgment. But now she is singing a different tune. In her petition she is now disowning both acknowledgments and claiming that the earlier payments both of which she had accepted as sufficient, are insufficient. They were valid before but they are not valid now. She also claimed she was harassed and cheated by the past management of the CDCP and sought the help of the new management of the PNCC under its "dynamic leadership." But now she is denouncing the new management-for also tricking her into signing the second quitclaim. Not all waivers and quitclaims are invalid as against public policy. If the agreement was voluntarily entered into and represents a reasonable settlement, it is binding on the parties and may not later be disowned simply because of a change of mind. It is only where there is clear proof that the waiver was wangled from an unsuspecting or gullible person, or the terms of settlement are unconscionable on its face, that the law will step in to annul the questionable transaction. But where it is shown that the person making the waiver did so voluntarily, with full understanding of what he was doing, and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as a valid and binding undertaking. As in this case. The question may be asked: Why did the petitioner sign the compromise agreement of September 16, 1980, and waive all her rights under the judgment in consideration of the cash settlement she received? It must be remembered that on that date the decision could still have been elevated on certiorari before this Court and there was still the possibility of its reversal. The petitioner obviously decided that a bird in hand was worth two on the wing and so opted for the compromise agreement. The amount she was then waiving, it is worth noting, had not yet come up to the exorbitant sum of P205,207.42 that she was later to demand after the lapse of eight years. The back pay due the petitioner need not detain us. We have held in countless cases that this should be limited to three years from the date of the illegal dismissal, during which period (but not beyond) the dismissed employee is deemed unemployed without the necessity of proof. 14 Hence, the petitioner's contention that she should be paid from 1978 to 1987 must be rejected, and even without regard to the fact (that would otherwise have been

counted against her) that she was actually employed during most of that period. Finally, the petitioner's invocation of Article 223 of the Labor Code to question the failure of the private respondent to file a supersedeas bond is not well-taken. As the Solicitor General correctly points out, the bond is required only when there is an appeal from the decision with a monetary award, not an order enforcing the decision, as in the case at bar. As officers of the court, counsel are under obligation to advise their clients against making untenable and inconsistent claims like the ones raised in this petition that have only needlessly taken up the valuable time of this Court, the Solicitor General, the Government Corporate Counsel, and the respondents. Lawyers are not merely hired employees who must unquestioningly do the bidding of the client, however unreasonable this may be when tested by their own expert appreciation of the pertinent facts and the applicable law and jurisprudence. Counsel must counsel. WHEREFORE, the petition is DENIED, with costs against the petitioner. It is so ordered.

Songco v NLRC G.R. 50999

Facts: Zuellig (M) Inc. filed with the Department of Labor (Regional Office No. 4) a clearance to terminate the services of petitioners Jose Songco, Romeo Cipres and Amancio Manuel due to alleged financial losses. However, the petitioners argued that the company is not suffering any losses and the real reason for their termination was their membership in the union. At the last hearing of the case, the petitioner manifested that they no longer contesting their dismissal, however, they argued that they should be granted a separation pay. Each of the petitioners was receiving a monthly salary of P40, 000.00 plus commissions for every sale they made. Under the CBA entered by the Zuellig Inc. and the petitioners, in Article XIV, Section 1(a), Any employee, who is separated from employment due to old age, sickness, death or permanent lay-off not due to the fault of said employee shall receive from the company a retirement gratuity in an amount equivalent to one month’s salary per year of service. One month of salary as used in this paragraph shall be deemed equivalent to the salary at date of retirement; years of service shall be deemed equivalent to total service credits, a fraction of at least six months being considered one year, including probationary employment. Other basis for petitioners’ contention are Article 284 of the Labor Code with regards to reduction of personnel and Sections 9(b) and 10 of Rule 1, Book VI of the Rules Implementing the Labor Code. The Labor Arbiter rendered his decision directing the company to pay the complainants separation pay equivalent to their one month salary (exclusive of commissions, allowances, etc.) for every year of service that they have worked with the company. The petitioners appealed to the NLRC but it was denied. Petitioner Romeo Cipres filed a Notice of Voluntary Abandonment and Withdrawal of petition contending that he had received, to his full and complete satisfaction, his separation pay. Hence, this petition. Issue: Whether or not earned sales commissions and allowances should be included in the monthly salary of petitioners for the purpose of computation of their separation pay. Held: The petition is granted. Petitioners’ contention that in arriving at the correct and legal amount of separation pay due to them, whether under the Labor Code or the CBA, their basic salary, earned sales commissions and allowances should be added

together. Insofar as whether the allowances should be included in the monthly salary of petitioners for the purpose of computation of their separation pay is concerned, this has been settled in the case of Santos vs. NLRC, 76721, in the computation of backwages and separation pay, account must be taken not only of the basic salary of petitioner but also of her transportation and emergency living allowances. In the issue of whether commission should be included in the computation of their separation pay, it is proper to define first commission. Black’s Law Dictionary defined commission as the recompensed, compensation or reward of an agent, salesman, executor, trustees, receiver, factor, broker or bailee, when the same is calculated as a percentage on the amount of his transactions or on the profit to the principal. The nature of the work of a salesman and the reason for such type of remuneration for services rendered demonstrate clearly that the commission are part of petitioners’ wage and salary. Some salesmen do not receive any basic salary but depend on commission and allowances or commissions alone, are part of petitioners’ wage and salary. Some salesman do not received any basic salary but depend on commission and allowances or commissions alone, although an employer-employee relationship exist. In Soriano v. NLRC, it is ruled then that, the commissions also claimed by petitioner (override commission plus net deposit incentive) are not properly includible in such base figure since such commissions must be earned by actual market transactions attributable to petitioner. Applying this by analogy, since the commissions in the present case were earned by actual market transactions attributable to petitioners, these should be included in their separation pay. In the computation thereof, what should be taken into account is the average commissions earned during their last year of employment.

Full Text G.R. No. L-7349

July 19, 1955

ATOK-BIG WEDGE MUTUAL BENEFIT ASSOCIATION, petitioner, vs. ATOK-BIG WEDGE MINING COMPANY, INCORPORATED, respondents.

discussions and exchange of views, the parties on October 29, 1952 reached an agreement effective from August 4, 1952 to December 31, 1954 (Rec. pp. 18-23). The Agreement in part provides:

The agreement was submitted to the Court for approval and on December 26, 1952, was approved by the Court in an order giving it effect as an award or decision in the case (Rec., p. 24).

I

Later, Case No. G.R. No. L-5276 was decided by this Court (promulgated March 3, 1953), affirming the decision of the Court of Industrial Relations fixing the minimum cash wage of the laborers and employees of the Atok-Big Wedge Mining Co. at P3.20 cash, without rice ration, or P2.65, with rice ration. On June 13, 1953, the labor union presented to the Court a petition for the enforcement of the terms of the agreement of October 29, 1952, as allegedly modified by the decision of this Court in G.R. No. L5276 and the provisions of the Minimum Wage Law, which has since taken effect, praying for the payment of the minimum cash wage of P3.45 a day with rice ration, or P4.00 without rice ration, and the payment of differential pay from August 4, 1952, when the award became effective. The mining company opposed the petition claiming that the Agreement of October 29, 1952 was entered into by the parties with the end in view that the company's cost of production be not increased in any way, so that it was intended to supersede whatever decision the Supreme Court would render in G.R. No. L-5276 and the provisions of the Minimum Wage Law with respect to the minimum cash wage payable to the laborers and employees. Sustaining the opposition, the Court of Industrial Relations, in an order issued on September 22, 1953 (Rec. pp. 44-49), denied the petition, upon the ground that when the Agreement of the parties of October 29, 1952 was entered into by them, they already knew the decision of said Court (although subject to appeal to the Supreme Court) fixing the minimum cash wage at P3.20 without rice ration, or P2.65 with rice ration, as well as the provisions of the Minimum Wage Law requiring the payment of P4 minimum daily wage in the provinces effective August 4, 1952; so that the parties had intended to be regulated by their Agreement of October 29, 1952. On the same day, the Court issued another order (Rec. pp. 50-55), denying the claim of the labor union for payment of an additional 50 per cent based on the basic wage of P4 for work on Sundays and holidays, holding that the payments being made by the company were within the requirements of the law. Its motion for the reconsideration of both orders having been denied, the labor union filed this petition for review by certiorari.

Pablo C. Sanidad for petitioner. Roxas and Sarmiento for respondents.

That the petitioner, Atok-Big Wedge Mining Company, Incorporated, agrees to abide by whatever decision that the Supreme Court may render with respect to Case No. 523-V (G.R. 5276) and Case No. 523-1 (10) (G.R. 5594).

REYES, J. B. L., J.:

xxx

On September 4, 1950, the petitioner labor union, the Atok-Big Wedge Mutual Benefit Association, submitted to the Atok-Big Wedge Mining Co., Inc. (respondent herein) several demands, among which was an increase of P0.50 in daily wage. The matter was referred by the mining company to the Court of Industrial Relations for arbitration and settlement (Case No. 523-V). In the course of conciliatory measures taken by the Court, some of the demands were granted, and others (including the demand for increased wages) rejected, and so, hearings proceeded and evidence submitted on the latter. On July 14, 1951, the Court rendered a decision (Record, pp. 25-32) fixing the minimum wage at P2.65 a day with the rice ration, or P3.20 without rice ration; denying the deduction from such minimum wage, of the value of housing facilities furnished by the company to the laborers, as well as the efficiency bonus given to them by the company; and ordered that the award be made effective retroactively from the date of the demand, September 4, 1950, as agreed by the parties. From this decision, the mining company appealed to this Court (G.R. No. L-5276).

III

Subsequently, an urgent petition was presented in Court on October 15, 1952 by the Atok-Big Wedge Mining Company for authority to stop operations and lay off employees and laborers, for the reason that due to the heavy losses, increased taxes, high cost of materials, negligible quantity of ore deposits, and the enforcement of the Minimum Wage Law, the continued operation of the company would lead to its immediate bankruptcy and collapse (Rec. pp. 100-109). To avert the closure of the company and the consequent lay-off of hundreds of laborers and employees, the Court, instead of hearing the petition on the merits, convened the parties for voluntary conciliation and mediation. After lengthy

xxx

xxx

xxx

xxx

xxx

That the petitioner, Atok-Big Wedge Mining Company, Incorporated, and the respondent, Atok-Big Wedge Mutual Benefit Association, agree that the following facilities heretofore given or actually being given by the petitioner to its workers and laborers, and which constitute as part of their wages, be valued as follows: Rice ration P.55 per day Housing facility 40 per day All other facilities such as recreation facilities, medical treatment to dependents of laborers, school facilities, rice ration during off-days, water, light, fuel, etc., equivalent to at least 85 per day It is understood that the said amount of facilities valued at the abovementioned prices, may be charged in full or partially by the Atok-Big Wedge Mining Company, Inc., against laborer or employee, as it may see fit pursuant to the exigencies of its operation.

The first issue submitted to us arises from an apparent contradiction in the Agreement of October 29, 1952. By paragraph

III thereof, the parties by common consent evaluated the facilities furnished by the Company to its laborers (rice rations, housing, recreation, medical treatment, water, light, fuel, etc.) at P1.80 per day, and authorized the company to have such value "charge in full or partially — against any laborer or employee as it may see fit"; while in paragraph I, the Company agreed to abide by the decision of this Court (pending at the time the agreement was had) in G.R. No. L-5594; and as rendered, the decision was to the effect that the Company could deduct from the minimum wage only the value of the rice ration. It is contended by the petitioner union that the two provisions should be harmonized by holding paragraph III (deduction of all facilities) to be merely provisional, effective only while this Court had not rendered its decision in G.R. No. L-5594; and that the terms of said paragraph should be deemed superseded by the decision from the time the latter became final, some four or five months after the agreement was entered into; in consequence, (it is claimed), the laborers became entitled by virtue of said decision to the prevailing P4.00 minimum wage with no other deduction than that of the rice ration, or a net cash wage of P3.45. This contention, in our opinion, is untenable. The intention of the parties could not have been to make the arrangement in paragraph III a merely provisional arrangement pending the decision of the Supreme Court for "this agreement" was expressly made retroactive and effective as of August 4, 1952, and to be in force up to and including December 31, 1954" (Par. IV). When concluded on October 29, 1952, neither party could anticipate the date when the decision of the Supreme Court would be rendered; nor is any reason shown why the parties should desire to limit the effects of the decision to the period 1952-1954 if it was to supersede the agreement of October 29, 1952. To ascertain the true import of paragraph I of said Agreement providing that the respondent company agreed to abide by whatever decision the Supreme Court would render in G.R. No. L5276, it is important to remember that, as shown by the records, the agreement was prompted by an urgent petition filed by the respondent mining company to close operations and lay-off laborers because of heavy losses and the full enforcement of the Minimum Wage Law in the provinces, requiring it to pay its laborers the minimum wage of P4; to avoid such eventuality, through the mediation of the Court of Industrial Relations, a

compromise was reached whereby it was agreed that the company would pay the minimum wage fixed by the law, but the facilities then being received by the laborers would be evaluated and charged as part of the wage, but without in any way reducing the P2.00 cash portion of their wages which they were receiving prior to the agreement (hearing of Oct. 28, 1952, CIR, t.s.n. 47). In other words, while it was the objective of the parties to comply with the requirements of the Minimum Wage Law, it was also deemed important that the mining company should not have to increase the cash wages it was then paying its laborers, so that its cost of production would not also be increased, in order to prevent its closure and the lay-off of employees and laborers. And as found by the Court below in the order appealed from (which finding is conclusive upon us), "it is this eventuality that the parties did not like to happen, when they have executed the said agreement" (Rec. p. 49). Accordingly, after said agreement was entered into, the Company started paying its laborers a basic cash or "takehome" wage of P2.20 (Rec. p. 9), representing the difference between P4 (minimum wage) and P1.80 (value of all facilities). With this background, the provision to abide by our decision in G.R. No. L-5276 can only be interpreted thus: That the company agreed to pay whatever award this Court would make in said case from the date fixed by the decision (which was that of the original demand, September 4, 1950) up to August 3, 1952 (the day previous to the effectivity of the Compromise Agreement) and from August 4, 1954 to December 31, 1954, they are to be bound by their agreement of October 29, 1952. This means that during the first period (September 4, 1950 to August 3, 1952), only rice rations given to the laborers are to be regarded as forming part of their wage and deductible therefrom. The minimum wage was then fixed (by the Court of Industrial Relations, and affirmed by this Court) at P3.20 without rice ration, or P2.65 with rice ration. Since the respondent company had been paying its laborers the basic cash or "take-home" wage of P2 prior to said decision and up to August 3, 1952, the laborers are entitled to a differential pay of P0.65 per working day from September 4, 1950 (the date of the effectivity of the award in G.R. L-5276) up to August 3, 1952. From August 4, 1952, the date when the Agreement of the parties of October 29, 1952 became effective (which was also the date when the Minimum Wage Law became fully enforceable in the

provinces), the laborers should be paid a minimum wage of P4 a day. From this amount, the respondent mining company is given the right to charge each laborer "in full or partially", the facilities enumerated in par. III of the Agreement; i.e., rice ration at P0.55 per day, housing facility at P0.40 per day, and other facilities "constitute part of his wages". It appears that the company had actually been paying its laborers the minimum wage of P2.20 since August 4, 1952; hence they are not entitled to any differential pay from this date. Petitioner argues that to allow the deductions stipulated in the Agreement of October 29, 1952 from the minimum daily wage of P4 would be a waiver of the minimum wage fixed by the law and hence null and void, since Republic Act No. 602, section 20, provides that "no agreement or contract, oral or written, to accept a lower wage or less than any other under this Act, shall be valid". An agreement to deduct certain facilities received by the laborers from their employer is not a waiver of the minimum wage fixed by the law. Wage, as defined by section 2 of Republic Act No. 602, "includes the fair and reasonable value as determined by the Secretary of Labor, of board, lodging, or other facilities customarily furnished by the employer to the employee." Thus, the law permits the deduction of such facilities from the laborer's minimum wage of P4, as long as their value is "fair and reasonable". It is not here claimed that the valuations fixed in the Agreement of October 29, 1952 are not fair and reasonable. On the contrary, the agreement expressly states that such valuations: "have been arrived at after careful study and deliberation by both representatives of both parties, with the assistance of their respective counsels, and in the presence of the Honorable Presiding Judge of the Court of Industrial Relations" (Rec. p. 2). Neither is it claimed that the parties, with the aid of the Court of Industrial Relations in a dispute pending before it, may not fix by agreement the valuation of such facilities, without referring the matter to the Department of Labor. Petitioner also argues that to allow the deductions of the facilities appearing in the Agreement referred to, would be contrary to the mandate of section 19 of the law, that "nothing in this Act . . . justify an employer . . . in reducing supplements furnished on the date of enactment.

The meaning of the term "supplements" has been fixed by the Code of Rules and Regulations promulgated by the Wage Administration Office to implement the Minimum Wage Law (Ch. 1, [c]), as: extra renumeration or benefits received by wage earners from their employees and include but are not restricted to pay for vacation and holidays not worked; paid sick leave or maternity leave; overtime rate in excess of what is required by law; sick, pension, retirement, and death benefits; profit-sharing; family allowances; Christmas, war risk and cost-of-living bonuses; or other bonuses other than those paid as a reward for extra output or time spent on the job. "Supplements", therefore, constitute extra renumeration or special privileges or benefits given to or received by the laborers over and above their ordinary earnings or wages. Facilities, on the other hand, are items of expense necessary for the laborer's and his family's existence and subsistence, so that by express provision of the law (sec. 2 [g]) they form part of the wage and when furnished by the employer are deductible therefrom since if they are not so furnished, the laborer would spend and pay for them just the same. It is thus clear that the facilities mentioned in the agreement of October 29, 1952 do not come within the term "supplements" as used in Art. 19 of the Minimum Wage Law. For the above reasons, we find the appeal from the Order of the Court a quo of September 22, 1953 denying the motion of the petitioner labor union for the payment of the minimum wage of P3.45 per day plus rice ration, or P4 without rice ration, to be unmeritorious and untenable. The second question involved herein relates to the additional compensation that should be paid by the respondent company to its laborers for work rendered on Sundays and holidays. It is admitted that the respondent company is paying an additional compensation of 50 per cent based on the basic "cash portion" of the laborer's wage of P2.20 per day; i.e., P1.10 additional compensation for each Sunday or holiday's work. Petitioner union insists, however, that this 50 per cent additional compensation should be computed on the minimum wage of P400 and not on the "cash portion" of the laborer's wage of P2.20, under the provisions of the Agreement of October 29, 1952 and the Minimum Wage Law.

Mabeza v NLRC SEC. 4. Commonwealth Act No. 444 (otherwise known as the Eight Hour Labor Law) provides: No person, firm, or corporations, business establishment or place or center of labor shall compel an employee or laborer to work during Sundays and holidays, unless he is paid an additional sum of at least twenty-five per centum of his regular renumeration: The minimum legal additional compensation for work on Sundays and legal holidays is, therefore, 25 per cent of the laborer's regular renumeration. Under the Minimum Wage Law, this minimum additional compensation is P1 a day (25 per cent of P4, the minimum daily wage). While the respondent company computes the additional compensation given to its laborers for work on Sundays and holidays on the "cash portion" of their wages of P2.20, it is giving them 50 per cent thereof, or P1.10 a day. Considering that the minimum additional compensation fixed by the law is P1 (25 per cent of P4), the compensation being paid by the respondent company to its laborers is even higher than such minimum legal additional compensation. We, therefore, see no error in the holding of the Court a quo that the respondent company has not violated the law with respect to the payment of additional compensation for work rendered by its laborers on Sundays and legal holidays. Finding no reason to sustain the present petition for review, the same is, therefore, dismissed, with costs against the petitioner Atok-Big Wedge Mutual Benefit Association.

FACTS: Norma Mabeza was an employee hired by Hotel Supreme in Baguio City. In 1991, an inspection was made by the Department of Labor and Employment (DOLE) at Hotel Supreme and the DOLE inspectors discovered several violations by the hotel management. Immediately, the owner of the hotel, Peter Ng, directed his employees to execute an affidavit which would purport that they have no complaints whatsoever against Hotel Supreme. Mabeza signed the affidavit but she refused to certify it with the prosecutor’s office. Later, when she reported to work, she was not allowed to take her shift. She then asked for a leave but was not granted yet she’s not being allowed to work. In May 1991, she then sued Peter Ng for illegal dismissal. Peter Ng, in his defense, said that Mabeza abandoned her work. In July 1991, Peter Ng also filed a criminal complaint against Mabeza as he alleged that she had stolen a blanket and some other stuff from the hotel. Peter Ng went on to amend his reply in the labor case to make it appear that the reason why he dismissed Mabeza was because of his loss of confidence by reason of the theft allegedly committed by Mabeza. The labor arbiter who handled the case, a certain Felipe Pati, ruled in favor of Peter Ng. ISSUE: Whether or not there is abandonment in the case at bar. Whether or not loss of confidence as ground for dismissal applies in the case at bar. HELD: No. The side of Peter Ng is bereft of merit so is the decision of the Labor Arbiter which was unfortunately affirmed by the NLRC. Abandonment Abandonment is not present. Mabeza returned several times to inquire about the status of her work or her employment status. She even asked for a leave but was not granted. Her asking for leave is a clear indication that she has no intention to abandon her work with the hotel. Even the employer knows that his purported reason of dismissing her due to abandonment will not fly so he amended his reply to indicate that it is actually “loss of confidence” that led to Mabeza’s dismissal. Loss of Confidence It is true that loss of confidence is a valid ground to dismiss an employee. But this is ideally only applied to workers whose

positions require a certain level or degree of trust particularly those who are members of the managerial staff. Evidently, an ordinary chambermaid who has to sign out for linen and other hotel property from the property custodian each day and who has to account for each and every towel or bedsheet utilized by the hotel’s guests at the end of her shift would not fall under any of these two classes of employees for which loss of confidence, if ably supported by evidence, would normally apply. Further, the suspicious filing by Peter Ng of a criminal case against Mabeza long after she initiated her labor complaint against him hardly warrants serious consideration of loss of confidence as a ground of Mabeza’s dismissal.

INTERNATIONAL SCHOOL ALLIANCE OF EDUCATORS (ISAE), petitioner, vs. HON. LEONARDO A. QUISUMBING in his capacity as the Secretary of Labor and Employment; HON. CRESENCIANO B. TRAJANO in his capacity as the Acting Secretary of Labor and Employment; DR. BRIAN MACCAULEY in his capacity as the Superintendent of International School-Manila; and INTERNATIONAL SCHOOL, INC., respondents., G.R. No. 128845, June 1, 2000

FACTS: Private respondent International School, Inc. (School), pursuant to PD 732, is a domestic educational institution established primarily for dependents of foreign diplomatic personnel and other temporary residents. The decree authorizes the School to employ its own teaching and management personnel selected by it either locally or abroad, from Philippine or other nationalities, such personnel being exempt from otherwise applicable laws and regulations attending their employment, except laws that have been or will be enacted for the protection of employees. School hires both foreign and local teachers as members of its faculty, classifying the same into two: (1) foreign-hires and (2) local-hires. The School grants foreign-hires certain benefits not accorded localhires. Foreign-hires are also paid a salary rate 25% more than localhires. When negotiations for a new CBA were held on June 1995, petitioner ISAE, a legitimate labor union and the collective bargaining representative of all faculty members of the School, contested the difference in salary rates between foreign and localhires. This issue, as well as the question of whether foreign-hires should be included in the appropriate bargaining unit, eventually caused a deadlock between the parties. ISAE filed a notice of strike. Due to the failure to reach a compromise in the NCMB, the matter reached the DOLE which favored the School. Hence this petition. ISSUE: Whether the foreign-hires should be included in bargaining unit of local- hires.

RULING: NO. The Constitution, Article XIII, Section 3, specifically provides that labor is entitled to “humane conditions of work.” These conditions are not restricted to the physical workplace – the factory, the office or the field – but include as well the manner by which employers treat their employees. Discrimination, particularly in terms of wages, is frowned upon by the Labor Code. Article 248 declares it an unfair labor practice for an employer to discriminate in regard to wages in order to encourage or discourage membership in any labor organization. The Constitution enjoins the State to “protect the rights of workers and promote their welfare, In Section 18, Article II of the constitution mandates “to afford labor full protection”. The State has the right and duty to regulate the relations between labor and capital. These relations are not merely contractual but are so impressed with public interest that labor contracts, collective bargaining agreements included, must yield to the common good. However, foreign-hires do not belong to the same bargaining unit as the local-hires. A bargaining unit is a group of employees of a given employer, comprised of all or less than all of the entire body of employees, consistent with equity to the employer indicate to be the best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law. The factors in determining the appropriate collective bargaining unit are (1) the will of the employees (Globe Doctrine); (2) affinity and unity of the employees’ interest, such as substantial similarity of work and duties, or similarity of compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining history; and (4) similarity of employment status. The basic test of an asserted bargaining unit’s acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights. In the case at bar, it does not appear that foreign-hires have indicated their intention to be grouped together with local-hires for purposes of collective bargaining. The collective bargaining history in the School also shows that these groups were always treated separately. Foreign-hires have limited tenure; local-hires

enjoy security of tenure. Although foreign-hires perform similar functions under the same working conditions as the local-hires, foreign-hires are accorded certain benefits not granted to localhires such as housing, transportation, shipping costs, taxes and home leave travel allowances. These benefits are reasonably related to their status as foreign-hires, and justify the exclusion of the former from the latter. To include foreign-hires in a bargaining unit with local-hires would not assure either group the exercise of their respective collective bargaining rights. WHEREFORE, the petition is GIVEN DUE COURSE. The petition is hereby GRANTED IN PART.