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1. The Supreme Court affirms the decision of the Court of Appeals and Accredited Voluntary Arbitrator Tomas E. Semana ruling that Sevilla Trading Company cannot unilaterally withdraw or reduce its practice of including non-basic benefits such as paid leaves in computing employees' 13th month pay.
2. Sevilla Trading Company had included such non-basic benefits in the 13th month pay computation for at least two years, establishing it as a voluntary employer practice that cannot be withdrawn under Article 100 of the Labor Code.
3. The Court ordered Sevilla Trading Company to pay back wages to covered employees resulting from the exclusion of said benefits in the 13th month pay computation
1. The Supreme Court affirms the decision of the Court of Appeals and Accredited Voluntary Arbitrator Tomas E. Semana ruling that Sevilla Trading Company cannot unilaterally withdraw or reduce its practice of including non-basic benefits such as paid leaves in computing employees' 13th month pay.
2. Sevilla Trading Company had included such non-basic benefits in the 13th month pay computation for at least two years, establishing it as a voluntary employer practice that cannot be withdrawn under Article 100 of the Labor Code.
3. The Court ordered Sevilla Trading Company to pay back wages to covered employees resulting from the exclusion of said benefits in the 13th month pay computation
1. The Supreme Court affirms the decision of the Court of Appeals and Accredited Voluntary Arbitrator Tomas E. Semana ruling that Sevilla Trading Company cannot unilaterally withdraw or reduce its practice of including non-basic benefits such as paid leaves in computing employees' 13th month pay.
2. Sevilla Trading Company had included such non-basic benefits in the 13th month pay computation for at least two years, establishing it as a voluntary employer practice that cannot be withdrawn under Article 100 of the Labor Code.
3. The Court ordered Sevilla Trading Company to pay back wages to covered employees resulting from the exclusion of said benefits in the 13th month pay computation
2. SEVILLA TRADING COMPANY, Petitioner, vs. A.V.A. TOMAS E. SEMANA, SEVILLA TRADING WORKERS UNIONSUPER, Reson!ents.
G.R. No. "#2$#% & Ari' 2(, 2))$
*ACTS& On appeal is the Decision of the Court of Appeals (CA) sustaining the sustaining the Decision of Accredited Voluntary Arbitrator Tomas E. Semana. or t!o to three years prior to "###$ petitioner Se%illa Trading Company (&etitioner)$ a domestic corporation engaged in trading business$ organi'ed and e(isting under &hilippine la!s$ added to the base figure$ in its computation of the ")th*month pay of its employees$ the amount of other benefits recei%ed by the employees !hich are beyond the basic pay. &etitioner claimed that it entrusted the preparation of the payroll to its office staff$ including the computation and payment of the ")th*month pay and other benefits.+hen it changed its person in charge of the payroll in the process of computeri'ing its payroll$ and after audit !as conducted$ it allegedly disco%ered the error of including non*basic pay or other benefits in the base figure used in the computation of the ")th*month pay of its employees.,t cited the -ules and -egulations ,mplementing &.D. .o. /0" !hich stated1 23asic salary shall include all remunerations or earnings paid by an employer to an employee for ser%ices rendered but may not include cost*of*li%ing allo!ances granted pursuant to &.D. .o. 040 or 5etter of ,nstruction .o. "67$ profit*sharing payments$ and all allo!ances and monetary benefits !hich are not considered or integrated as part of the regular or basic salary of the employee at the time of the promulgation of the Decree on December "8$ "#60.9 &etitioner then effected a change in the computation of the thirteenth month pay$ as follo!s1 ")th*month pay : net basic pay ;ence$ the ne! computation reduced the employees thirteenth month pay.The daily piece*rate !or<ers represented by pri%ate respondent Se%illa Trading +or<ers =nion S=&E- (=nion$ for short)$ a duly organi'ed and registered union$ through the >rie%ance ?achinery in their Collecti%e 3argaining Agreement$ contested the ne! computation and reduction of their thirteenth month pay.The parties failed to resol%e the issue. The =nion alleged that petitioner %iolated the rule prohibiting the elimination or diminution of employees benefits as pro%ided for in Art. "@@ of the 5abor Code$ as amended.They claimed that paid lea%es$ li<e sic< lea%e$ %acation lea%e$ paternity lea%e$ union lea%e$ berea%ement lea%e$ holiday pay and other lea%es !ith pay in the C3A should be included in the base figure in the computation of their ")th*month pay. ISSUE& +O.a %oluntary act of the employer!hich !as fa%orable to the employees though not conforming to la!$ has ripened into a practice and therefore can be !ithdra!n$ reduced$ diminished$ discontinued or eliminatedA +ELD& NO. As such the SC affirms the decision of the Accredited Voluntary Arbitrator Tomas E. Semana granting to pay corresponding bac< !ages to all co%ered and entitled employees arising from the e(clusion of said benefits in the computation of ")th*month pay. RATIO DECIDENDI& +ith regard to the length of time the company practice should ha%e been e(ercised to constitute %oluntary employer practice !hich cannot be unilaterally !ithdra!n by the employer$ !e hold that Burisprudence has not laid do!n any rule reCuiring a specific minimum number of years. ,n the abo%e Cuoted case of Da%ao ruits Corporation %s. Associated 5abor =nions$ the company practice lasted for si( (8) years. ,n another case$ Da%ao ,ntegrated &ort Ste%edoring Ser%ices %s. AbarCue'$ the employer$ for three ()) years and nine (#) months$ appro%ed the commutation to cash of the unenBoyed portion of the sic< lea%e !ith pay benefits of its intermittent !or<ers. +hile in Tiangco %s. 5eogardo$ Dr. the employer carried on the practice of gi%ing a fi(ed monthly emergency allo!ance from .o%ember "#68 to ebruary "#/@$ or three ()) years and four (7) months . In ,'' t-ese .,ses, t-is Co/rt -e'! t-,t t-e 0r,nt o1 t-ese 2ene1its -,s riene! into .o3,n4 r,.ti.e or o'i.4 5-i.- .,nnot 2e ere3tori'4 5it-!r,5n. ,n the case at bar$ petitioner Se%illa Trading <ept the practice of including non*basic benefits such as paid lea%es for unused sic< lea%e and %acation lea%e in the computation of their ")th*month pay for at least t!o (4) years. This, we rule likewise constitutes voluntary employer practice which cannot be unilaterally withdrawn by the employer without violating Art. 100 of the Labor Code.
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