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PEÑARANDA v BAGANGA PLYWOOD CORPORATION
Facts
Petitioner Charlito Peñaranda was hired as an employee of Baganga Plywood Corporation (BPC)
to take charge of the operations and maintenance of its steam plant boiler.6 In May 2001,
Peñaranda filed a Complaint for illegal dismissal with money claims against BPC and its general
manager, Hudson Chua, before the NLRC.
Petitioner claimed that he was illegally terminated as Foreman/Boiler Head/Shift Engineer.
Furthermore, he was not paid his overtime pay, premium pay for working during holidays/rest
days, night shift differentials and finally claims for payment of damages and attorney’s fees having
been forced to litigate the present complaint.
The respondent argued that it was on temporary closure due to repair and general maintenance
and it applied for clearance with the Department of Labor and Employment, Regional Office No.
XI to shut down and to dismiss employees. Due to the insistence of petitioner he was paid his
separation benefits consequently, when respondent [BPC] partially reopened in January 2001, he
failed to reapply. Hence, he
was not terminated from employment much less illegally. Furthermore, being a managerial
employee he is not entitled to overtime pay.
Issue :WON Peñaranda is entitled to the payment of OVERTIME PAY and OTHER MONETARY
BENEFITS
No.
Ruling:
Petition is DENIED. Article 82 of the Labor Code exempts managerial employees from entitlement
to overtime pay and premium pay for working on rest days. The Court disagrees with the NLRC’s
finding that petitioner was a managerial employee. However, petitioner was a member of the
managerial staff, which also takes him out of the coverage of labor standards. Petitioner
supervised the engineering section of the steam plant boiler. His work involved overseeing the
operation of the machines and the performance of the workers in the engineering section. This
work necessarily required the use of discretion and independent judgment to ensure the proper
functioning of the steam plant boiler. As supervisor, petitioner is deemed a member of the
managerial staff
DOCTRINE:Article 82 of the Labor Code exempts managerial employees from the coverage of
labor standards. Labor standards provide the working conditions of employees, including
entitlement to overtime pay and premium pay for working on rest days
The Implementing Rules of the Labor Code define members of a managerial staff as those with
the following duties and responsibilities:
1. The primary duty consists of the performance of work directly related to management
policies of the employer;
2. Customarily and regularly exercise discretion and independent judgment;
3. (i) Regularly and directly assist a proprietor or a managerial employee whose primary
duty consists of the management of the establishment in which he is employed or
subdivision thereof; or (ii) execute under general supervision work along specialized or
technical lines requiring special training, experience, or knowledge; or (iii) execute
under general supervision special assignments and tasks; and
who do not devote more than 20 percent of their hours worked in a workweek to activities which
are not directly and closely related to the performance of the work described in paragraphs (1),
(2), and (3) above
BATONG BUHAY GOLDMINES V DELA SERNA
August 6, 1999, Purisima, Definition and Classification
FACTS
- Employees filed a complaint against Batong Buhay for: unpaid salaries from March 16, 1987 to
present, unpaid and ECOLA differentials under Wage Order Nos. 2 and 5, unpaid 13th months pay
for 1985 and 1986, and upaid vacation/sick/compensatory leave benefits.
- Labor Standards and Welfare Officers & Regional Director: Batong Buhay must pay Ty et al.
P4,818,746.40
- Regional Director directed Batong Buhay to put up a cash or surety bond otherwise a writ of
execution will be issued.
- The Special Sheriff seized three units of Peterbuilt trucks and then sold the same by public auction.
Various materials and motor vehicles were also seized on different dates and sold at public auction.
- Batong Buhay finally posted a supersedeas bond and appealed the Order contending that the
Regional Director had no jurisdiction over the case.
- Undersec dela Serna upheld the jurisdiction of the Regional Director and annulled all the auction
sales conducted by Special Sheriff. MR denied.
- Motion for Intervention was filed by MFT Corporation and Salter Holdings Pty., Ltd. For exclusion
from annulment of the properties sold at the auction sale. Granted. MR denied.
ISSUES
1. WON the Regional Director has jurisdiction over the complaint filed by the employees of BBGMI
2. WON the auction sales conducted by the said Special Sheriff are valid
RULING
1. YES
- The subject labor standards case of the petition arose from the visitorial and enforcement powers
by the Regional Director of DOLE.
- Labor standards refers to the minimum requirements prescribed by existing laws, rules and
regulations relating to wages, hours of work, cost of living allowance and other monetary and
welfare benefits, including occupational, safety and health standards. Labor standards cases are
governed by Article 128(b) of the Labor Code.
- Even in the absence of E.O. 111 , Regional Directors already had enforcement powers over money
claims, effective under P.D. 850, issued on December 16, 1975, which transferred labor standards
cases from the arbitration system to the enforcement system.
- E.O. No. 111 was issued on December 24, 1986 or three(3) months after the promulgation of the
Secretary of Labor's decision upholding private respondents' salary differentials and ECOLAs on
September 24, 1986. The amendment of the visitorial and enforcement powers of the Regional
Director (Article 128(b)) by said E.O. 111 reflects the intention enunciated in Policy Instructions Nos.
6 and 37 to empower the Regional Directors to resolve uncontested money claims in cases where
an employer-employee relationship still exists. This intention must be given weight and entitled to
great respect.
- The Court would have ruled differently had the petitioner shown that subject labor standards case
is within the purview of the exception clause in Article 128 (b) of the Labor Code. Said provision
requires the concurrence of the following elements in order to divest the Regional Director or his
representatives of jurisdiction, to wit: (a) that the petitioner (employer) contests the findings of the
labor regulations officer and raises issues thereon; (b) that in order to resolve such issues, there is
a need to examine evidentiary matters; and (c) that such matters are not verifiable in the normal
course of inspection.
- Petitioner's refusal to allow the Labor Standards and Welfare Officers to conduct inspection in the
premises of their head office and the failure to file their position paper is equivalent to a waiver of
its right to contest the claims of the employees.
- This involves a labor standards case and it is in keeping with the law that "the worker need not
litigate to get what legally belongs to him, for the whole enforcement machinery of the Department
of Labor exists to insure its expeditious delivery to him free of charge.
- The present law, RA 7730, can be considered a curative statute to reinforce the conclusion that
the Regional Director has jurisdiction over the present labor standards case.
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2. NO
- As a general rule, findings of fact and conclusion of law arrived at by quasi-judicial agencies are
not to be disturbed absent any showing of grave abuse of discretion tainting the same.
- There was grave abuse of discretion when the Undersec, without any evidentiary support,
adjudged such prices as "scandalously low". He merely relied on the self-serving assertion by the
petitioner that the value of the auctioned properties was more than the price bid.
- The sales are null and void since on the properties of petitioner involved was constituted a
mortgage between petitioner and the Development Bank of the Philippines