Sime Darby Philippines, Inc. v.

NLRC
G.R. No. 119205
April 15, 1998
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, 7:45am-4:45pm and Sat
7:45am-11:45am) with coffee break of 10 minutes between 9:30am-10:30am and 2:30pm3:30pm 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 dismissing 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.
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?
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.
Insular Bank of Asia and America Employees Union (IBAAEU) v. Inciong
1

G.R. No. L-52415

October 23, 1984
Facts: The Secretary of Labor, issued Policy no. 9 interpreting article 94 of Labor Code as
regards Right to Holiday pay, stated among others, that PD 850 principally intended to benefit
daily-paid workers. Those who are paid by the month, i.e., he is paid uniformly from January to
December is presumed to have been paid with legal holidays, unless his salary is deducted for
the month the holiday occurs. Invoking this Policy, the Bank stopped paying its employees for
the legal holidays.
Issue: Whether or not, PD 850 was intended only for daily wage workers.
Ruling: It is elementary in the rules of statutory construction that when the language of the law
is clear and unequivocal the law must be taken to mean exactly what it says. In the case at bar,
the provisions of the Labor Code on the entitlement to the benefits of holiday pay are clear and
explicit - it provides for both the coverage of and exclusion from the benefits. In Policy
Instruction No. 9, the then Secretary of Labor went as far as to categorically state that the benefit
is principally intended for daily paid employees, when the law clearly states that every worker
shall be paid their regular holiday pay. This is a flagrant violation of the mandatory directive of
Article 4 of the Labor Code, which states that "All doubts in the implementation and
interpretation of the provisions of this Code, including its implementing rules and
regulations, shall be resolved in favor of labor." Moreover, it shall always be presumed that the
legislature intended to enact a valid and permanent statute which would have the most beneficial
effect that its language permits.

Fernandez v. NLRC
285 SCRA 149
2

Facts: Q. Reynaldo worked as a bus driver for Nelbusco, Inc. On February 28, 1993, the air
conditioning unit of the bus which Reynaldo was driving suffered a mechanical breakdown. The
company told Reynaldo to wait until the air conditioning unit was repaired. No other bus was
assigned to Reynaldo to keep him gainfully employed. Reynaldo continued reporting to
his employers office for work, only to find out that the air conditioning unit had not been
repaired. More than six months elapsed but Reynaldo was not given work. He filed a complaint
for illegal dismissal. The NLRC ruled that there was no illegal dismissal.
Issue: Whether or not there was illegal dismissal.
Ruling: Yes, there was illegal dismissal and the ruling was erroneous. Under Article 286 of the
labor Code, the bona fide suspension of the operation of a business or undertaking for a period
not exceeding six months shall not terminate employment. Consequently, when the suspension
exceeds six months, the employment of the employee shall be deemed terminated. By the same
token and applying said rule by analogy, if the employee was forced to remain without work or
assignment for a period exceeding six months, then he is in effect constructively dismissed. The
so-called floating status of an employee should last only for a legally prescribed period of
time. When that floating status lasts for more than six months, he may be considered to have
been illegally dismissed from the service.

Integrated Contractor and Plumbing Works, Inc. v. NLRC

G.R. No. 152427
August 9, 2005
3

Facts: Petitioner is a plumbing contractor. Its business depends on the number and frequency of
the projects it is able to contract with its clients. Private respondent Solon worked for petitioner.
And his employment record shows that he has by petitioner from December 1994 to January
1998 in 10 projects. On February 23, 1998, while private respondent was about to log out from
work, he was informed by the warehouseman that the main office had instructed them to tell him
it was his last day of work as he had been terminated. When private respondent went to the
petitioners office on February 24, 1998 to verify his status, he found out that indeed, he had
been terminated. He went back to petitioners office on February 27, 1998 to sign a clearance so
he could claim his 13th month pay and tax refunds. However, he had second thoughts and
refused to sign the clearance when he read the clearance indicating he had resigned. On March 6,
1998, he filed a complaint alleging that he was illegally dismissed without just cause and without
due process. The petitioner asserts that the private respondent was a project employee. Thus,
when the project was completed and private respondent was not re-assigned to another project,
petitioner did not violate any law since it was petitioners discretion to re-assign the private
respondent to other projects.
Issue: Whether the respondent is a project employee of the petitioner or a regular employee.
Ruling: The SC held that the principal test in determining whether an employee is a project
employee or regular employee, is, whether he is assigned to carry out a specific project or
undertaking, the duration (and scope) of which are specified at the time the employee is
engaged in the project. Project refers to a particular job or undertaking that is within the
regular or usual business of the employer, but which is distinct and separate and identifiable from
the undertakings of the company. Such job or undertaking begins and ends at determined or
determinable times. The SC was convinced he was initially a project employee. The services he
rendered, the duration and scope of each project are clear indications that he was hired as a
project employee. However, once a project or work pool employee has been: (1) continuously, as
opposed to intermittently, re-hired by the same employer for the same tasks or nature of tasks;
and (2) these tasks are vital, necessary and indispensable to the usual business or trade of the
employer, then the employee must be deemed a regular employee. The test to determine whether
employment is regular or not is the reasonable connection between the particular activity
performed by the employee in relation to the usual business or trade of the employer. Also, if the
employee has been performing the job for at least one year, even if the performance is not
continuous or merely intermittent, the law deems the repeated and continuing need for its
performance as sufficient evidence of the necessity, if not indispensability of that activity to the
business. Thus, we held that where the employment of project employees is extended long after
the supposed project has been finished, the employees are removed from the scope of project
employees and are considered regular employees. While length of time may not be the
controlling test for project employment, it is vital in determining if the employee was hired for a
specific undertaking or tasked to perform functions vital, necessary and indispensable to the
usual business or trade of the employer. Here, private respondent had been a project employee
several times over. His employment ceased to be coterminous with specific projects when he was
repeatedly re-hired due to the demands of petitioners business.
Uniwide Sales Warehouse Club v. NLRC
G.R. No. 154503
Febeuary 29, 2008
4

Facts: Amalia P. Kawada (private respondent) started her employment with Uniwide sometime
in 1981 as a saleslady. Over the years, private respondent worked herself within Uniwide's
corporate ladder until she attained the rank of Full Assistant Store Manager with a monthly
compensation of P13,000.00 in 1995. As a Full Assistant Store Manager, private respondent's
primary function was to manage and oversee the operation of the Fashion and Personal Care,
GSR Toys, and Home Furnishing Departments of Uniwide, to ensure its continuous profitability
as well as to see to it that the established company policies and procedures were properly
complied with and implemented in her departments. Sometime in 1998, Uniwide received reports
from the other employees regarding some problems in the departments managed by the private
respondent. Thus, on March 15, 1998, Uniwide, through Store Manager Apduhan, issued a
Memorandum addressed to the private respondent summarizing the various reported incidents
signifying unsatisfactory performance on the latter's part which include the commingling of good
and damaged items, sale of a voluminous quantity of damaged toys and ready-to-wear items at
unreasonable prices, and failure to submit inventory reports. Uniwide asked private respondent
for concrete plans on how she can effectively perform her job. In a letter dated March 23, 1998,
private respondent answered all the allegations contained in the March 15, 1998 Memorandum.
Unsatisfied, Apduhan sent another Memorandum dated March 30, 1998 to private respondent
where Apduhan claimed that the answers given by the private respondent in her March 23, 1998
letter were all hypothetical and did not answer directly the allegations attributed to her. Apduhan
elaborated the incidents contained in the March 15, 1998 Memorandum.
Issue: Whether or not the Court of Appeals seriously erred in sustaining the NLRCs finding that
private respondent was constructively dismissed.
Ruling: The petition is meritorious. After a thorough examination of the conflicting positions of
the parties, the Court finds the records bereft of evidence to substantiate the conclusions of the
NLRC and the CA that private respondent was constructively dismissed from employment.
Case law defines constructive dismissal as a cessation of work because continued employment is
rendered impossible, unreasonable or unlikely; when there is a demotion in rank or diminution in
pay or both; or when a clear discrimination, insensibility, or disdain by an employer becomes
unbearable to the employee. The test of constructive dismissal is whether a reasonable person in
the employee's position would have felt compelled to give up his position under the
circumstances. It is an act amounting to dismissal but made to appear as if it were not. In fact, the
employee who is constructively dismissed may be allowed to keep on coming to work.
Constructive dismissal is therefore a dismissal in disguise. The law recognizes and resolves this
situation in favor of employees in order to protect their rights and interests from the coercive acts
of the employer.

State Marine Cooperation And Royal Line, Inc. v. Cebu Seamens Association, Inc.
G.R. No. L-12444
February 28, 1963
5

Facts: The Union (CEBU SEAMEN'S ASSOCIATION, INC.) alleged that the officers and men
working on board the petitioners' vessels have not been paid their sick leave, vacation leave and
overtime pay; that the petitioners threatened or coerced them to accept a reduction of salaries,
observed by other ship owners; that after the Minimum Wage Law had taken effect, the
petitioners required their employees on board their vessels, to pay the sum of P.40 for every
meal, while the masters and officers were not required to pay their meals and that because
Captain Carlos Asensi had refused to yield to the general reduction of salaries, the petitioners
dismissed said captain who now claims for reinstatement and the payment of back wages from
December 25, 1952, at the rate of P540.00, monthly. The petitioners' shipping companies,
answering, averred that there is no law which provides for the payment of sick leave or vacation
leave to employees or workers of private firms, and that in enacting Rep. Act No. 602 (Minimum
Wage Law), the Congress had in mind that the amount of P.40 per meal, furnished the employees
should be deducted from the daily wages. A decision was rendered on February 21, 1957 in favor
of the respondent union. The motion for reconsideration thereof, having been denied, the
companies filed the present writ of certiorari, to resolve legal question involved.
Issue: Whether or not there is a conflict between Sec. 3, par. (f) and SEC. 19 of the Minimum
Wage Law, (R.A. No. 602).
Ruling: Section 3, par. f, of the Minimum Wage Law, (R.A. No. 602), provides as follows
-(f) Until and unless investigations by the Secretary of Labor on his initiative or on petition of
any interested party result in a different determination of the fair and reasonable value, the
furnishing of meals shall be valued at not more than thirty centavos per meal for agricultural
employees and not more than forty centavos for any other employees covered by this Act, and
the furnishing of housing shall be valued at not more than twenty centavos daily for
agricultural workers and not more than forty centavos daily for other employees covered by this
Act. Petitioners maintain, in view of the above provisions, that in fixing the minimum wage of
employees, Congress took into account the meals furnished by employers and that in fixing the
rate of forty centavos per meal, the lawmakers had in mind that the latter amount should be
deducted from the daily wage, otherwise, no rate for meals should have been provided. However,
section 19, same law, states: SEC. 19. Relations to other labor laws and practices.- Nothing in
this Act shall deprive an employee of the right to seek fair wages, shorter working hours and
better working conditions nor justify an employer in violating any other labor law applicable to
his employees, in reducing the wage now paid to any of his employees in excess of the minimum
wage established under this Act, or in reducing supplements furnished on the date of enactment.
It is evident that Section 3(f) constitutes the general rule, while section 19 is the exception. In
other words, if there are no supplements given, within the meaning and contemplation of section
19, but merely facilities, section 3(f) governs. There is no conflict; the two provisions could, as
they should be harmonized. And even if there is such a conflict, the respondent CIR should
resolve the same in favor of the safety and decent living laborers (Art. 1702, new Civil Code).

Chiang Kai Shek College v. CA

G.R. No. 152988
August 24, 2004
6

Facts: Private respondent Belo was employed as a permanent teacher by petitioner CKSC for 15
years. Belo had to take a leave of absence for the S.Y. 1992. On 1993, due to personal reasons,
petitioner informed her that they could not guarantee her a teaching load when she would return
and that only teachers in service may enjoy the privilege and benefits provided by the school. On
1994, petitioner reasoned that it already hired non-permanent teachers to take her load. The
Labor Arbiter reasoned that she was not dismissed but there was simply no available teaching
load for her. The NLRC reversed the LAs decision and ordered her reinstatement with full back
wages. The Court of Appeals declared that Belo was constructively dismissed; the dismissal,
illegal, for being violated of her security of tenure.
Issue: Whether private respondent was constructively dismissed and therefore entitled to
reinstatement and back wages
Ruling: It must be noted at the outset that Ms. Belo had been a full-time teacher in petitioner
CKSC continuously for fifteen years or since 1977 until she took a leave of absence for the
school year 1992-1993. Under the Manual of Regulations for Private Schools, for a private
school teacher to acquire a permanent status of employment and, therefore, be entitled to a
security of tenure, the following requisites must concur: (a) the teacher is a full-time teacher; (b)
the teacher must have rendered three consecutive years of service; and (c) such service must
have been satisfactory. Since Ms. Belo has measured up to these standards, she therefore enjoys
security of tenure. The fundamental guarantees of security of tenure and due process dictate that
no worker shall be dismissed except for just and authorized cause provided by law and after due
notice and hearing. Case law defines constructive dismissal as a cessation from work because
continued employment is rendered impossible, unreasonable, or unlikely; when there is a
demotion in rank or a diminution in pay or both; or when a clear discrimination, insensibility, or
disdain by an employer becomes unbearable to the employee. It, therefore, blows our mind why
the petitioners would require Ms. Belo, a permanent teacher since1977 with a satisfactory service
record, to signify her intention to teach in March 1993. Plainly, the petitioners violated their
avowed policies. Since Ms. Belo was not retiring, resigning or filing another leave of absence
after the school year 1992-1993, the petitioners should have considered her as consenting to
teach for the incoming school year 1993-1994. In fact, they should not have required her to reapply to teach. In accordance with the written statement of policies dated 12 March 1993, only
probationary teachers are required by the petitioners to re-apply in March. Failure of
probationary teachers to re-apply in March is an indication of their lack of interest to teach again
at the school. Petitioners invocation of the third policy that of giving teaching assignments to
probationary teachers in April to justify their refusal to provide Ms. Belo a teaching load is,
therefore, a lame excuse that rings of untruth and dishonesty. Patently clear is the illegal manner
by which the petitioners eased out Ms. Belo from the teaching corps.

Manila Electric Company v. Secretary of Labor

G.R. No. 127598
January 27, 1999
7

Facts: The court directed the parties to execute a CBA incorporating the terms among which are
the following modifications among others: Wages: Php1,900 for 1995-1996; Retroactivity:
December 28, 1996-Dec. 1999, etc. Dissatisfied, some members of the union filed a motion for
intervention/reconsideration. Petitioner warns that is the wage increase of Php2,000.00 per
month as ordered is allowed, it would pass the cost covering such increase to the consumers
through an increase rate of electricity. On the retroactivity of the CBA arbitral award, the parties
reckon the period as when retroaction shall commence.
Issue: Whether or not retroactivity of arbitral awards shall commence at such time as granted by
Secretary.
Ruling: In St. Lukes Medical vs Torres, a deadlock developed during CBA negotiations between
management unions. The Secretary assumed jurisdiction and ordered the retroaction of the CBA
to the date of expiration of the previous CBS. The Court ratiocinated thus: In the absence of a
specific provision of law prohibiting retroactive of the effectivity of arbitral awards issued by the
Secretary pursuant to article 263(g) of the Labor Code, public respondent is deemed vested with
the plenary and discretionary powers to determine the effectivity thereof.
In general, a CBA negotiated within six months after the expiration of the existing CBA retroacts
to the day immediately following such date and if agreed thereafter, the effectivity depends on
the agreement of the parties. On the other hand, the law is silent as to the retroactivity of a CBA
arbitral award or that granted not by virtue of the mutual agreement of the parties but by
intervention of the government. In the absence of a CBA, the Secretarys determination of the
date of retroactivity as part of his discretionary powers over arbitral awards shall control.
Wherefore, the arbitral award shall retroact from December 1, 1995 to November 30, 1997; and
the award of wage is increased from Php1,900 - Php2,000.

Globe Mackay Cable and Radio Corporation v. NLRC

G.R. No. 74156
January 29, 1988

Facts: On October 30, 1984 Wage Order No. 6 mandated an increased in the cost-of-living
allowance of non-agricultural workers in the private sector for P3.00. The order was complied by
the petitioner Corporation by multiplying the same by 22 days, equivalent to the number of
working days in the company.
Respondent union alleges that instead of multiplying the COLA by 22 it should be multiplied by
30 representing the number of days in a month, as what the corporation's normal practice prior to
the said Wage Order. Thus the union filed a complaint against the Corporation for for illegal
deduction, underpayment, unpaid allowances, and violation of Wage Order No. 6.
Issue: Whether or not COLA under Wage Order No. 6 should be multiplied by 22 or 30
representing the number of working days in a month.
Ruling: Labor Arbiter Adelaido F. Martinez sustained the position of Petitioner Corporation by
holding that since the individual petitioners acted in their corporate capacity they should not have
been impleaded; and that the monthly COLA should be computed on the basis of twenty two (22)
days, since the evidence showed that there are only 22 paid days in a month for monthly-paid
employees in the company. His reasoning, inter alia, was as follows:
To compel the respondent company to use 30 days in a month to compute the allowance and
retain 22 days for vacation and sick leave, overtime pay and other benefits is inconsistent and
palpably unjust. If 30 days is used as divisor, then it must be used for the computation of all
benefits, not just the allowance. But this is not fair to complainants, not to mention that it will
contravene the provision of the parties' CBA.
Section 5 of the Rules Implementing Wage Orders Nos. 2, 3, 5 and 6 uniformly read as follows:
Section 5. Allowance for Unworked Days. All covered employees shall be entitled to their daily
living allowance during the days that they are paid their basic wage, even if unworked. It is
evident that the intention of the law is to grant ECOLA upon the payment of basic wages. Hence,
we have the principle of 'No Pay, No ECOLA.

Prubankers Association v. Prudential Bank and Trust Company

G.R. No. 131247
January 25, 1999
Facts: On November 18, 1993, the Regional Tripartite Wages and Productivity Board of Region
V issued Wage Order No. RB 05-03 which provided for a Cost of Living Allowance (COLA) to
9

workers in the private sector who ha[d] rendered service for at least three (3) months before its
effectivity, and for the same period [t]hereafter, in the following categories: SEVENTEEN
PESOS AND FIFTY CENTAVOS (P17.50) in the cities of Naga and Legaspi; FIFTEEN PESOS
AND FIFTY CENTAVOS (P15.50) in the municipalities of Tabaco, Daraga, Pili and the city of
Iriga; and TEN PESOS (P10.00) for all other areas in the Bicol Region.Subsequently on
November 23, 1993, the Regional Tripartite Wages and Productivity Board of Region VII issued
Wage Order No. RB VII-03, which directed the integration of the COLA mandated pursuant to
Wage Order No. RO VII-02-A into the basic pay of all workers. It also established an increase in
the minimum wage rates for all workers and employees in the private sector as follows: by Ten
Pesos (P10.00) in the cities of Cebu, Mandaue and Lapulapu; Five Pesos (P5.00) in the
municipalities of Compostela, Liloan, Consolacion, Cordova, Talisay, Minglanilla, Naga and the
cities of Davao, Toledo, Dumaguete, Bais, Canlaon, and Tagbilaran.
The petitioner then granted a COLA of P17.50 to its employees at its Naga Branch, the only
branch covered by Wage Order No. RB 5-03, and integrated the P150.00 per month COLA into
the basic pay of its rank-and-file employees at its Cebu, Mabolo and P. del Rosario branches, the
branches covered by Wage Order No. RB VII-03.
On June 7, 1994, respondent Prubankers Association wrote the petitioner requesting that the
Labor Management Committee be immediately convened to discuss and resolve the alleged
wage distortion created in the salary structure upon the implementation of the said wage orders.
Issue: Whether or not a wage distortion resulted from respondents implementation of the
aforecited Wage Orders.
Ruling: The statutory definition of wage distortion is found in Article 124 of the Labor Code, as
amended by Republic Act No. 6727, which reads: Article 124. Standards/Criteria for Minimum
Wage Fixing xxx.
-As used herein, a wage distortion shall mean a situation where an increase in prescribed wage
results in the elimination or severe contraction of intentional quantitative differences in wage or
salary rates between and among employee groups in an establishment as to effectively obliterate
the distinctions embodied in such wage structure based on skills, length of service, or other
logical bases of differentiation.
Elaborating on this statutory definition, this Court ruled: Wage distortion presupposes a
classification of positions and ranking of these positions at various levels. One visualizes a
hierarchy of positions with corresponding ranks basically in terms of wages and other
emoluments. Where a significant change occurs at the lowest level of positions in terms of basic
wage without a corresponding change in the other level in the hierarchy of positions, negating as
a result thereof the distinction between one level of position from the next higher level, and
resulting in a parity between the lowest level and the next higher level or rank, between new
entrants and old hires, there exists a wage distortion. xxx. The concept of wage distortion
assumes an existing grouping or classification of employees which establishes distinctions
among such employees on some relevant or legitimate basis. This classification is reflected in a
differing wage rate for each of the existing classes of employees
Wage distortion involves four elements:
1. An existing hierarchy of positions with corresponding salary rates
2. A significant change in the salary rate of a lower pay class without a concomitant increase in
the salary rate of a higher one
3. The elimination of the distinction between the two levels
4. The existence of the distortion in the same region of the country.
10

In the present case, it is clear that no wage distortion resulted when respondent implemented the
subject Wage Orders in the covered branches. In the said branches, there was an increase in the
salary rates of all pay classes. Furthermore, the hierarchy of positions based on skills, length of
service and other logical bases of differentiation was preserved. In other words, the quantitative
difference in compensation between different pay classes remained the same in all branches in
the affected region. Put differently, the distinction between Pay Class 1 and Pay Class 2, for
example, was not eliminated as a result of the implementation of the two Wage Orders in the said
region. Hence, it cannot be said that there was a wage distortion.
Petitioner argues that a wage distortion exists because the implementation of the two Wage
Orders has resulted in the discrepancy in the compensation of employees of similar pay
classification in different regions. Hence, petitioner maintains that, as a result of the two Wage
Orders, the employees in the affected regions have higher compensation than their counterparts
of the same level in other regions. Several tables are presented by petitioner to illustrate that the
employees in the regions covered by the Wage Orders are receiving more than their counterparts
in the same pay scale in other regions.
The Court is not persuaded. Wage parity between employees in different rungs is not at issue
here, but a wage disparity between employees in the same rung but located in different regions of
the country.

Paga-Asa Steel Works, Inc. v. CA

G.R. No. 166647
March 31, 2006
Facts: Petitioner is engaged in the manufacture of steel bars and wire rods while Pag-Asa Steel
Workers Union is the duly authorized bargaining agent of the rank-and-file employees. RTWPB
of NCR issued a wage order which provided for a Php13.00 increase of the salaries receiving
11

minimum wages consequent increase in the minimum wage rate to Php198.00 per day. The
Petitioner and the union negotiated on the increase. Petitioner forwarded a letter to the union
with the list of adjustments involving rank and file employees. In September 1999, the petitioner
and union entered into a collective bargaining agreement where it provided wage adjustments
namely Php15, Php25, Php30 for three succeeding year. On the first year, the increase provided
were followed until RTWPB issued another wage order where it provided for a Php25.50 per day
increase in the salary of employees receiving the minimum wage and increased the minimum
wage to Php223.50 per day. Petitioner paid the Php25.50 per day increase to all of its rank-andfile employees. On November 2000, Wage Order No. NCR-08 was issued where it provided the
increase of Php26.50 per day making the minimum Php250.00 per day. The union president
asked that the wage order be implemented. Petitioner rejected the request, claiming that since
none of the employees were receiving a daily salary rate lower than Php250.00 and there was no
wage distortion, it was not obliged to grant the wage increase. The Union elevated the matter to
the National Conciliation and Mediation Board. When the parties failed to settle, they agreed to
refer the case to voluntary arbitration where it favored the position of the company that there was
no company practice of granting a wage order increase to employees across-the-board, and that
there is no provision in the CBA that would oblige petitioner to grant the wage increase under
Wage Order No. NCR-08 across-the-board, and dismissed the complaint. The matter was
elevated to CA under Rule 43 of the Rules of Court where it favored the respondents.
Issue: Whether or not the company was obliged to grant the wage increase under the Wage Order
No. 8 as a matter of practice.
Ruling: Company is not obliged to grant the wage increase under Wage Order No. NCR-08
either by virtue of the CBA, or as a matter of company practice. It is submitted that employers
unless exempt are mandated to implement the said wage order but limited to those entitled
thereto. A perusal of the record shows that the lowest paid employee before the implementation
of Wage Order No. 8 is Php250.00/day and none was receiving below Php223.50 minimum. This
could only mean that the union can no longer demand for any wage distortion adjustment. The
provision of wage order no. 8 and its implementing rules are very clear as to who are entitled to
the Php26.50/day increase, i.e. private sector workers and employees in the National Capital
Region receiving the prescribed daily minimum wage rate of Php223.50 shall receive an increase
of Php26.50 per day, and since the lowest paid is P250.00/day the company is not obliged to
adjust the wages of the workers. The provision in the CBA that Any Wage Order to be
implemented by the Regional Tripartite Wage and Productivity Board shall be in addition to the
wage increase adverted above cannot be interpreted in support of an across-the-board increase.
Moreover, to ripen into a company practice that is demandable as a matter of right, the giving of
the increase should not be by reason of a strict legal or contractual obligation, but by reason of an
act of liberality on the part of the employer. Hence, even if the company continuously grants a
wage increase as mandated by a wage order or pursuant to a CBA, the same would not
automatically ripen into a company practice.
Marcropper Mining Corp. v. Ople
G.R. No. L-51254
June 11, 1981
Facts: It is in pursuance of the constitutional principle of the enjoyment by the people of a
decent standard of living that a Presidential Decree was issued by way of response to the ravages
of worldwide inflation, causing extreme difficulty to laborers and wage-earners. It reads thus:
"Section 1. All employers are hereby required to pay all their employees receiving a basic salary
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of not more than P 1,000 a month, regardless of the nature of their employment, a 13th-month
pay not later than December 24 of every year. Sec. 2, employers already paying their employees
a 13th-month pay or its equivalent are not concerned by this Decree. Sec. 3, This Decree shall
take effect immediately. Relying on the above Decree, private respondent Marcopper Employees
Labor Union filed a complaint before the National Labor Relations Commission for the payment
of the 13th-month salary. Petitioner Marcopper Mining Corporation opposed on the ground that
in view of its then existing collective bargaining agreement adopted on October 8, 1977 which
granted the employees belonging to private respondent midyear and year-end bonuses, it was
exempt from the operation of such Decree.
Issue: Whether or not all employee monetary benefits provided in the CBA are in addition to,
and may not be taken as substitute for, the employee benefits granted by law.
Ruling: The conclusion reached by the Court receives an even more compelling justification
from the Constitution. The 1935 Constitution enshrined the concepts of social justice and
prosecutions to labor. Even then, there was a realization of their importance in vitalizing a
regime of liberty not just as immunity from governmental restraint but as the assumption by the
State of an obligation to assure a life of dignity for all, especially the poor and the needy. The
expanded social justice and protection to labor provisions of the present Constitution lend added
emphasis to the concern ' for social and economic rights.

National Federation of Sugar Workers (NFSW) v. Ovejera

G.R. No. L-59743
May 31, 1982
Facts: NFSW has been the bargaining agent of CAC rank and file employees (about 1200 of
more than 2000 personnel) and has concluded with CAC a collective bargaining agreement
effective February 16, 1981 February 15, 1984. On November 28, 1981, NFSW struck
allegedly to compel the payment of the 13th month pay under PD 851, in addition to the
Christmas, milling and amelioration bonuses being enjoyed by CAC workers. To settle the strike,
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a compromise agreement was concluded between CAC and NFSW on November 30, 1981. As
of November 30, 1981, G.R. No. 51254 (Marcopper Mining Corp. vs. Blas Ople and Amado
Inciong, Minister and Deputy Minister of Labor, respectively, and Marcopper Employees Labor
Union, Petition for certiorari and Prohibition) was still pending in the Supreme Court. The
Petition had been dismissed on June 11, 1981 on the vote of seven Justices. 1 A motion for
reconsideration thereafter filed was denied in a resolution dated December 15, 1981, with only
five Justices voting for denial.
Issue: Whether the strike declared by NFSW is illegal, the resolution of which mainly depends
on the mandatory or directory character of the cooling-off period and the 7-day strike ban after
report to MOLE of the result of a strike-vote, as prescribed in the Labor Code.
Ruling: When the law says "the labor union may strike" should the dispute "remain
unsettled until the lapse of the requisite number of days (cooling-off period) from the filing of
the notice," the unmistakable implication is that the union may not strike before the lapse of the
cooling-off period. Similarly, the mandatory character of the 7-day strike ban after the report on
the strike-vote is manifest in the provision that "in every case," the union shall furnish the MOLE
with the results of the voting "at least seven (7) days before the intended strike, subject to the
(prescribed) cooling-off period." It must be stressed that the requirements of cooling-off period
and 7-day strike ban must both be complied with, although the labor union may take a strike vote
and report the same within the statutory cooling-off period. If only the filing of the strike notice
and the strike-vote report would be deemed mandatory, but not the waiting periods so
specifically and emphatically prescribed by law, the purposes (hereafter discussed) for which the
filing of the strike notice and strike-vote report is required would not be achieved, as when a
strike is declared immediately after a strike notice is served, or when as in the instant case
the strike-vote report is filed with MOLE after the strike had actually commenced Such
interpretation of the law ought not and cannot be countenanced. It would indeed be self-defeating
for the law to imperatively require the filing on a strike notice and strike-vote report without at
the same time making the prescribed waiting periods mandatory.

Kar Asia, Inc. v. Corona

G.R. No. 154985
August 24, 2004
Facts: Respondents, regular employees of petitioner KAR ASIA, Inc., an automotive dealer in
Davao City, filed on September 24, 1997 a complaint for underpayment of wages and attorneys
fees before Branch XI, Regional Arbitration Branch of Davao City. They claimed that they were
not paid their cost of living allowance (COLA), as mandated by the Regional Tripartite and
Wages Productivity Board (RTWPB) XI Wage Order No. 3, for the months of December 1993
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and December 1994, and prayed that petitioner be ordered to pay the same with 1% interest per
month, as well as attorneys fees equivalent to 10% of the total monetary award.
Petitioner company and its president Celestino Barretto countered that the complaint was false
and malicious; that respondents had already been paid their COLA for the said periods; and that
respondents scared off potential customers and caused a substantial reduction in the income of
the petitioner company estimated at, more or less, Php1,000,000.00 when they picketed and put
up streamers with insulting and derogatory slogans. Petitioners presented in evidence the
payrolls for December 1993 and December 1994 showing that the respondents acknowledged in
writing the receipt of their COLA, and the affidavits of Ermina Daray and Cristina Arana,
cashiers of KAR ASIA, refuting respondents claim that they were made to sign blank pieces of
paper.
Issue: Whether or not the petitioner company paid the respondents the COLA for December
1993 and December 1994 as mandated by RTWPB XI Wage Order No. 3.
Ruling: The December 1994 payrolls contain a computation of the amounts payable to the
employees for the given period, including a breakdown of the allowances and deductions on the
amount due, but the signatures of the respondents are conspicuously missing. Ideally, the
signatures of the respondents should appear in the payroll as evidence of actual payment.
However, the absence of such signatures does not necessarily lead to the conclusion that the
December 1994 COLA was not received. It appears that the pay slips for the same period bear
the signatures of the respondents plus a certification that they received the full compensation for
the services rendered. While ordinarily a pay slip is only a statement of the gross monthly
income of the employee, his signature therein coupled by an acknowledgement of full
compensation alters the legal complexion of the document. The pay slip becomes a substantial
proof of actual payment. Moreover, there is no hard-and-fast rule requiring that the employees
signature in the payroll is the only acceptable proof of payment. By implication, the respondents,
in signing the pay slips with their acknowledgement of full compensation, unqualifiedly admitted
the receipt thereof, including the COLA for December 1994. The Court of Appeals erred when it
placed undue reliance on the unsigned payrolls and disregarded the signed pay slips. Factual
findings by quasi-judicial agencies, such as the National Labor Relations Commission, which
have acquired expertise because their jurisdiction is confined to specific matters, are generally
accorded not only respect but even finality.

G & M Philippines, Inc. v. Cruz

G.R. No. 140495
April 15, 2005
Facts: Petitioner G & M (Phils.), Inc. recruited respondent Cruz as trailer driver for its foreign
principal, Salim Al Yami Est., for a period of two years, and with a stipulated monthly salary of
US$625, starting June 6, 1990. Respondent alleged that when he arrived in the Kingdom of
Saudi Arabia, he was made to sign an employment contract in blank and his salary was reduced
to SR604.00. Seven months into employment, his employer deported him on December 28,
1990. According to respondent, the cause for his dismissal was his complaint for sub-human
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working conditions, non-payment of wages and overtime pay, salary deduction and change of
employer. Hence, he filed with the Labor Arbiter an Affidavit/Complaint against petitioner for
illegal dismissal, underpayment and non-payment of wages, and refund of transportation
expenses. Respondent claims that he was only paid in an amount equivalent to five months
salary and he did not receive his salary for the last two months. Respondent submitted a copy of
his pay slip showing the amount of SR604.00 as his basic salary.
Petitioner contends that respondent abandoned his job when he joined an illegal strike and
refused to report for work, constituting a breach of his employment contract and a valid cause for
termination of employment. Petitioner also claims that the pay slip submitted by respondent is
inadmissible because the original copy was not presented and that its existence, due execution,
genuineness and authenticity were not established.
Issue: Whether or not there is evidence on record to support the findings of the Labor Arbiter,
the NLRC and the Court of Appeals that respondent is entitled to the payment of salary
differential and unpaid wages.
Ruling: It was the finding of the Court of Appeals that it is the burden of petitioner to prove that
the salaries paid by its foreign principal complied with the contractual stipulations of their
agency-worker agreement. Since petitioner failed to discharge such burden, then it was correct
for the NLRC to rely on respondents claim of underpayment. The Court of Appeals also ruled
that since the positive testimony of respondent, as creditor, is sufficient to prove non-payment
even without the indefinite testimony of petitioner, as debtor, then the payroll (pay slip),
presented by respondent to prove that he only received the amount of SR604.00 as basic monthly
salary, is immaterial. The rule is that the burden of proving payment of monetary claims rests on
the employer, in this case, herein petitioner, it being the employment agency or recruitment
entity, and agent of the foreign principal, Salim Al Yami Est., which recruited respondent.

Escasinas v. Shangri-las Mactan Island Resort

G.R. No. 178827
March 24, 2009
Facts: Registered nurses Jeromie D. Escasinas and Evan Rigor Singco (petitioners) were
engaged in 1999 and 1996, respectively, by Dr. Jessica Joyce R. Pepito (respondent doctor) to
work in her clinic at respondent Shangri-las Mactan Island Resort (Shangri-la) in Cebu of which
she was a retained physician. In late 2002, petitioners filed with the National Labor Relations
Commission (NLRC) a complaint for regularization, underpayment of wages, non-payment of
holiday pay, night shift differential and 13th month pay differential against respondents, claiming
that they are regular employees of Shangri-la. Shangri-la claimed, however, that petitioners were
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not its employees but of respondent doctor, that Article 157 of the Labor Code, as amended, does
not make it mandatory for a covered establishment to employ health personnel, that the services
of nurses is not germane nor indispensable to its operations, and that respondent doctor is a
legitimate individual contractor who has the power to hire, fire and supervise the work of nurses
under her. The Labor Arbiter declared petitioners to be regular employees of Shangri-la, noting
that the petitioners usually perform work which is necessary and desirable to Shangri-las
business, and thus ordered Shangri-la to grant them the wages and benefits due them as regular
employees from the time their services were engaged. Upon appeal, the NLRC declared that no
employer-employee relationship existed between Shangri-la and petitioners. It ruled that contrary
to the finding of the LA, even if Art. 280 of the Labor Code states that if a worker performs work
usually necessary or desirable in the business of an employer, he cannot be automatically deemed
a regular employee, and that the Memorandum of Agreement between the respondent and the
respondent doctor amply shows that respondent doctor was in fact engaged by Shangri-la on
retainer basis, under which she could hire her own nurses and other clinic personnel.
Issue: Whether or not Article 157 of the Labor Code makes it mandatory for covered
establishment to employ health personnel
Ruling: The Court holds that, contrary to petitioners postulation, Art. 157 does not require the
engagement of full-time nurses as regular employees of a company employing not less than 50
workers. Thus, the Article provides:
ART. 157. Emergency medical and dental services. It shall be the duty of every employer to
furnish his employees in any locality with free medical and dental attendance and facilities
consisting of:
(a) The services of a full-time registered nurse when the number of employees exceeds fifty (50)
but not more than two hundred (200) except when the employer does not maintain hazardous
workplaces, in which case the services of a graduate first-aider shall be provided for the
protection of the workers, where no registered nurse is available. The Secretary of Labor shall
provide by appropriate regulations the services that shall be required where the number of
employees does not exceed fifty (50) and shall determine by appropriate order hazardous
workplaces for purposes of this Article;(b) The services of a full-time registered nurse, a parttime physician and dentist, and an emergency clinic, when the number of employees exceeds two
hundred (200) but not more than three hundred (300); and(c) The services of a full-time
physician, dentist and full-time registered nurse as well as a dental clinic, and an infirmary or
emergency hospital with one bed capacity for every one hundred (100) employees when the
number of employees exceeds three hundred (300).
Remington Industrial Sales Corp. v. Castaneda
G.R. No. 169295-96
November 20, 2006
Facts: The present controversy began when private respondent, Erlinda Castaneda ("Erlinda")
instituted on March 2, 1998 a complaint for illegal dismissal, underpayment of wages, nonpayment of overtime services, non-payment of service incentive leave pay and non-payment of
13th month pay against Remington before the NLRC, National Capital Region, Quezon City.
The complaint impleaded Mr. Antonio Tan in his capacity as the Managing Director of
Remington. Erlinda alleged that she started working in August 1983 as company cook with a
salary of Php4,000.00 for Remington, a corporation engaged in the trading business; that she
worked for six (6) days a week, starting as early as 6:00 a.m. because she had to do the
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marketing and would end at around 5:30 p.m., or even later, after most of the employees, if not
all, had left the company premises; that she continuously worked with Remington until she was
unceremoniously prevented from reporting for work when Remington transferred to a new site in
Edsa, Caloocan City. She averred that she reported for work at the new site in Caloocan City on
January 15, 1998, only to be informed that Remington no longer needed her services. Erlinda
believed that her dismissal was illegal because she was not given the notices required by law;
hence, she filed her complaint for reinstatement without loss of seniority rights, salary
differentials, service incentive leave pay, 13th month pay and 10% attorneys fees.
Issue: Whether NLRC erred in issuing the second decision despite losing its jurisdiction due to
the pendency of the first petition for certiorari with the Court of Appeals.
Ruling: No. As to petitioners argument that the NLRC had already lost its jurisdiction to decide
the case when it filed its petition for certiorari with the Court of Appeals upon the denial of its
motion for reconsideration, suffice it to state that under Section 7 of Rule 65 of the Revised
Rules of Court, the petition shall not interrupt the course of the principal case unless a temporary
restraining order or a writ of preliminary injunction has been issued against the public respondent
from further proceeding with the case. Thus, the mere pendency of a special civil action for
certiorari, in connection with a pending case in a lower court, does not interrupt the course of the
latter if there is no writ of injunction. Clearly, there was no grave abuse of discretion on the part
of the NLRC in issuing its second decision which modified the first, especially since it failed to
consider the respondents motion for reconsideration when it issued its first decision.

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