LABOR LAW DIGEST POOL

C/O CASE DETAILS CASE DIGEST

FACTS: Ms. Imelda Damasco was a regular sales clerk in Manila Glass Supply in Olongapo City.
was employed by respondents as Sales Clerk on January 30, 1992, receiving lately a daily wage of
P140.00. Petitioner was made to work from 8:30 in the morning up to 9:30 in the evening continuously
from Monday to Sunday without having been paid overtime pay, rest day pay and holiday pay and that
during the period of her employment, she was not paid any 13th month pay as well as five (5) days
service incentive leave pay.

On August 28, 1992 at around 7:00 o’clock in the evening, while she was working, respondent
Bonifacio Sia called her up and told her to finish all her works that night, but she told respondent that
she would not be able to finish them all because it was already late which led to respondent being
angry at petitioner and told her he does not want to see her anymore and petitioner suffered trauma
because of the actions of respondent.

On December 7, 1992, Damasco filed before the NLRC Regional Arbitration Branch in San Fernando,
Pampanga for illegal dismissal and non-payment of overtime pay including non-payment of 13th month
pay, service incentive leave pay, holiday pay and night shift differential.

LA RULING:
On September 2, 1993, the labor arbiter rendered judgment in favor of Ms. Damasco. The labor official
declared that Sia has not shown any just or authorized cause in terminating the services of Damasco,
except for wild, generalized and self-serving statements that Damasco committed serious misconduct
or willful disobedience of the lawful orders in connection with her work.

The Labor Arbiter ruled that Damasco is entitled to 13th month pay, service incentive leave pay, holiday
pay, overtime pay with a total of 112,570 plus 10% attorney's fees.

NLRC RULING:
On appeal, the NLRC upheld the labor arbiter’s finding that Damasco was illegally dismissed but
modified the labor official’s judgment with a total award of 99,022.00 including attorney's fees.(overtime
not awarded)
Damasco v.
Vinoya CA RULING: (NO CA Ruling)
NLRC, G.R. No.
115755,
Overtime ISSUE: W/N petitioner is entitled to overtime pay?
December 4,
Pay
2000
SC RULING:
YES, petitioner is entitled to overtime pay.

In view of Sia’s formal admission that Ms. Damasco worked beyond eight hours daily, the latter is
entitled to overtime compensation. No further proof is required.

Even assuming that Damasco received a wage which is higher than the minimum provided by law, it
does not follow that any additional compensation due her can be offset by her pay in excess of the
minimum, in the absence of an express agreement to that effect. Moreover, such arrangement, if there
be any, must appear in the manner required by law on how overtime compensation must be
determined.

On illegal dismissal:(optional)
SC found no merit in Sia’s allegation that Ms. Damasco abandoned her job. To constitute abandonment,
two elements must concur:
(1) the failure to report for work or absence without valid or justifiable reason, and
(2) a clear intention to sever the employer-employee relationship, with the second element as the more
determinative factor when manifested by some overt acts.

Abandoning one’s job means the deliberate, unjustified refusal of the employee to resume his
employment and the burden of proof is on the employer to show a clear and deliberate intent on the
part of the employee to discontinue employment.

In this case, there are no overt acts established by Sia from which we can infer the clear intention of
Damasco to desist from employment.
An employee who is unjustly dismissed from work is entitled to reinstatement without loss of seniority
rights and other privileges as well as to his full backwages, inclusive of allowances, and to other
benefits or their monetary equivalent computed from the time his compensation was withheld from him
up to the time of his actual reinstatement.

FACTS:

LA RULING:
Zagala Realda v. New
NLRC RULING:
Age Graphics,
Overtime G.R. No. 192190,
CA RULING:
Pay April 25, 2012
ISSUE:

SC RULING:
 FACTS:
Petitioner Romeo Lagatic was employed by Cityland as a marketing specialist. He was tasked with
soliciting sales for the company including doing cold calls. On October 22, 1991, Cityland issued a
written reprimand to the petitioner for his failure to submit his cold calls reports from September to
October 1991. He again failed to submit the same report from September to October 1992. He was
suspended for 3 days with a similar warning. In February 1993, he again failed to submit cold call
reports. Petitioner received a memorandum for the said acts. He was verbally reminded to submit the
same and was even given up to February 17, 1993 to do so. Instead of complying with said directive,
petitioner, on February 16, 1993, wrote a note, "TO HELL WITH COLD CALLS! WHO CARES?" and
exhibited the same to his co-employees. Finding the petitioner guilty of gross insubordination. Cityland
served a notice of dismissal upon him on February 26, 1993. Aggrieved by such dismissal, petitioner
filed a complaint against Cityland for illegal dismissal, illegal deduction, underpayment, overtime and
rest day pay, damages and attorney's fees.

LA RULING:
The labor arbiter dismissed the petition for lack of merit

NLRC RULING:
On appeal, the same was affirmed.

CA RULING:

ISSUE:
Whether or not the petitioner is entitled to overtime pay

SC RULING:
Cabantog
Lagatic v. NLRC, With respect to petitioner's claims for overtime pay, rest day pay and holiday premiums, Cityland
G.R. No. 121004, maintains that Saturday and Sunday call-ins were voluntary activities on the part of sales personnel
Overtime
Jan. 28, 1998 who wanted to realize more sales and thereby earn more commissions. It is their contention that sales
Pay
personnel were clamoring for the "privilege" to attend Saturday and Sunday call-ins, as well as to
entertain walk-in clients at project sites during weekends, that Cityland had to stagger the schedule of
sales employees to give everyone a chance to do so. But simultaneously, Cityland claims that the same
were optional because call-ins and walk-ins were not scheduled every weekend. If there really was a
clamor on the part of sales staff to "voluntarily" work on weekends, so much so that Cityland needed to
schedule them, how come no call-ins or walk-ins were scheduled on some weekends?
In addition to the above, the labor arbiter and the NLRC sanctioned respondent's practice of offsetting
rest day or holiday work with equivalent time on regular work days on the ground that the same is
authorized by Department Order 21, Series of 1990. As correctly pointed out by the petitioner, said D.O.
was misapplied in this case. The D.O. involves the shortening of the workweek from six days to five
days but with prolonged hours on those five days. Under this scheme, non-payment of overtime
premiums was allowed in exchange for longer weekends for employees. In the instant case, the
petitioner's workweek was never compressed. Instead, he claims payment for work over and above his
normal 5 1/2 days of work in a week. Applying by analogy the principle that overtime cannot be offset by
undertime, to allow off-setting would prejudice the worker. He would be deprived of the additional pay
for the rest day work he has rendered and which is utilized to offset his equivalent time off on regular
workdays. To allow Cityland to do so would be to circumvent the law on payment of premiums for rest
day and holiday work.
Notwithstanding the foregoing discussion, petitioner failed to show his entitlement to overtime and rest
day pay due, to the lack of sufficient evidence as to the number of days and hours when he rendered
overtime and rest day work. Entitlement to overtime pay must first be established by proof that said
overtime work was actually performed, before an employee may avail of said benefit. To support his
allegations, petitioner submitted in evidence minutes of meetings wherein he was assigned to work on
weekends and holidays at Cityland's housing projects. Suffice it to say that said minutes do not prove
that petitioner actually worked on said dates. It is a basic rule in evidence that each party must prove
his affirmative allegations. This petitioner failed to do

FACTS: On November 8, 1985, Filipro, Inc. (now Nestle Philippines, Inc.) filed with the National Labor
Relations Commission (NLRC) a petition for declaratory relief seeking a ruling on its rights and
obligations respecting claims of its monthly paid employees for holiday pay in the light of the Court's
decision in Chartered Bank Employees Association v. Ople (138 SCRA 273 [1985]).

Both Filipro and the Union of Filipino Employees (UFE) agreed to submit the case for voluntary
arbitration and appointed respondent Benigno Vivar, Jr. as voluntary arbitrator.

VOLUNTARY ARBITRATOR RULING: IN FAVOR OF UNION FILPRO EMPLOYEES (UFE)

Union of Filipro Directed Filipro to pay its monthly paid employees holiday pay pursuant to Article 94 of the Code,
Chan Employees v. subject only to the exclusions and limitations specified in Article 82 and such other legal restrictions as
Vivar, Jr., G.R. are provided for in the Code.
Holiday Pay No. 79255,
January 20, 1992 NLRC RULING: REMANDED THE CASE BACK TO THE VOLUNTARY ARBITRATOR

Respondent Arbitrator treated the two motions as appeals and forwarded the case to the NLRC which
issued a resolution dated May 25, 1987 remanding the case to the respondent arbitrator on the ground
that it has no jurisdiction to review decisions in voluntary arbitration cases pursuant to Article 263 of the
Labor Code as amended by Section 10, Batas Pambansa Blg. 130 and as implemented by Section 5 of
the rules implementing B.P. Blg. 130.

*Arbitrator did not take cognizance of the remanded case by reason of resignation from service.
CA RULING: NONE

ISSUE: 1) Whether or not Nestle's sales personnel are entitled to holiday pay; and

2) Whether or not, concomitant with the award of holiday pay, the divisor should be changed
from 251 to 261 days and whether or not the previous use of 251 as divisor resulted in
overpayment for overtime, night differential, vacation and sick leave pay.

SC RULING:

1) Sales Personnel are field personnel

Under Article 82, field personnel are not entitled to holiday pay. Said article defines field
personnel as "non-agritultural employees who regularly perform their duties away from the
principal place of business or branch office of the employer and whose actual hours of work in
the field cannot be determined with reasonable certainty."

The controversy centers on the interpretation of the clause "whose actual hours of work in the
field cannot be determined with reasonable certainty."

It is undisputed that these sales personnel start their field work at 8:00 a.m. after having
reported to the office and come back to the office at 4:00 p.m. or 4:30 p.m. if they are
Makati-based.

The petitioner maintains that the period between 8:00 a.m. to 4:00 or 4:30 p.m. comprises the
sales personnel's working hours which can be determined with reasonable certainty.

The Court does not agree. The law requires that the actual hours of work in the field be
reasonably ascertained. The company has no way of determining whether or not these sales
personnel, even if they report to the office before 8:00 a.m. prior to field work and come back
at 4:30 p.m, really spend the hours in between in actual field work.

Moreover, the requirement that "actual hours of work in the field cannot be determined with
reasonable certainty" must be read in conjunction with Rule IV, Book III of the Implementing
Rules which provides:

Rule IV Holidays with Pay

Sec. 1. Coverage — This rule shall apply to all employees except:

xxx xxx xxx

(e) Field personnel and other employees whose time and performance is unsupervised by the
employer . . . (Emphasis supplied)

While contending that such rule added another element not found in the law (Rollo, p. 13), the
petitioner nevertheless attempted to show that its affected members are not covered by the
abovementioned rule. The petitioner asserts that the company's sales personnel are strictly
supervised as shown by the SOD (Supervisor of the Day) schedule and the company circular
dated March 15, 1984 (Annexes 2 and 3, Rollo, pp. 53-55).

Contrary to the contention of the petitioner, the Court finds that the aforementioned rule did not
add another element to the Labor Code definition of field personnel. The clause "whose time
and performance is unsupervised by the employer" did not amplify but merely interpreted and
expounded the clause "whose actual hours of work in the field cannot be determined with
reasonable certainty." The former clause is still within the scope and purview of Article 82
which defines field personnel. Hence, in deciding whether or not an employee's actual working
hours in the field can be determined with reasonable certainty, query must be made as to
whether or not such employee's time and performance is constantly supervised by the
employer.

The SOD schedule adverted to by the petitioner does not in the least signify that these sales
personnel's time and performance are supervised. The purpose of this schedule is merely to
ensure that the sales personnel are out of the office not later than 8:00 a.m. and are back in
the office not earlier than 4:00 p.m.

Likewise, the Court fails to see how the company can monitor the number of actual hours
spent in field work by an employee through the imposition of sanctions on absenteeism
contained in the company circular of March 15, 1984.

The petitioner claims that the fact that these sales personnel are given incentive bonus every
quarter based on their performance is proof that their actual hours of work in the field can be
 determined with reasonable certainty.

The Court thinks otherwise.

The criteria for granting incentive bonus are: (1) attaining or exceeding sales volume based on
sales target; (2) good collection performance; (3) proper compliance with good market
hygiene; (4) good merchandising work; (5) minimal market returns; and (6) proper truck
maintenance. (Rollo, p. 190).

The above criteria indicate that these sales personnel are given incentive bonuses precisely
because of the difficulty in measuring their actual hours of field work. These employees are
evaluated by the result of their work and not by the actual hours of field work which are hardly
susceptible to determination.

2) Payment of Holiday Pay shall be reckoned from the IBAA Case (Oct. 23, 1984) not
the Labor Code nor the Chartered Bank Case

Nestle insists that the reckoning period for the application of the holiday pay award is 1985
when the Chartered Bank decision, promulgated on August 28, 1985, became final and
executory, and not from the date of effectivity of the Labor Code. Although the Court does not
entirely agree with Nestle, we find its claim meritorious.

In Insular Bank of Asia and America Employees' Union (IBAAEU) v. Inciong, 132 SCRA 663
[1984], hereinafter referred to as the IBAA case, the Court declared that Section 2, Rule IV,
Book III of the implementing rules and Policy Instruction No. 9, issued by the then Secretary of
Labor on February 16, 1976 and April 23, 1976, respectively, and which excluded monthly paid
employees from holiday pay benefits, are null and void. The Court therein reasoned that, in the
guise of clarifying the Labor Code's provisions on holiday pay, the aforementioned
implementing rule and policy instruction amended them by enlarging the scope of their
exclusion. The Chartered Bank case reiterated the above ruling and added the "divisor" test.

However, prior to their being declared null and void, the implementing rule and policy
instruction enjoyed the presumption of validity and hence, Nestle's non-payment of the holiday
benefit up to the promulgation of the IBAA case on October 23, 1984 was in compliance with
these presumably valid rule and policy instruction.

The "operative fact" doctrine realizes that in declaring a law or rule null and void, undue
harshness and resulting unfairness must be avoided. It is now almost the end of 1991. To
require various companies to reach back to 1975 now and nullify acts done in good faith is
unduly harsh. 1984 is a fairer reckoning period under the facts of this case.

Applying the aforementioned doctrine to the case at bar, it is not far-fetched that Nestle, relying
on the implicit validity of the implementing rule and policy instruction before this Court nullified
them, and thinking that it was not obliged to give holiday pay benefits to its monthly paid
employees, may have been moved to grant other concessions to its employees, especially in
the collective bargaining agreement. This possibility is bolstered by the fact that respondent
Nestle's employees are among the highest paid in the industry. With this consideration, it
would be unfair to impose additional burdens on Nestle when the non-payment of the holiday
benefits up to 1984 was not in any way attributed to Nestle's fault.

The Court thereby resolves that the grant of holiday pay be effective, not from the date of
promulgation of the Chartered Bank case nor from the date of effectivity of the Labor Code, but
from October 23, 1984, the date of promulgation of the IBAA case.

FACTS: Riviera Home Improvements, Inc. is engaged in the business of selling and installing
ornamental and construction materials. It employed petitioners Virgilio Agabon and Jenny Agabon as
gypsum board and cornice installers on January 2, 19922 until February 23, 1999 when they were
dismissed for abandonment of work.

Petitioners then filed a complaint for illegal dismissal and payment of money claims.
Agabon v.
Dela Cruz
NLRC, G.R. No. LA RULING: IN FAVOR OF THE AGABONS
158693, Nov. 17,
Holiday Pay
2004 DISPOSITIVE:
WHEREFORE, premises considered, We find the termination of the complainants illegal. Accordingly,
respondent is hereby ordered to pay them their backwages up to November 29, 1999 in the sum of:

1. Jenny M. Agabon - P56, 231.93

 2. Virgilio C. Agabon - 56, 231.93

and, in lieu of reinstatement to pay them their separation pay of one (1) month for every year of service
from date of hiring up to November 29, 1999.

Respondent is further ordered to pay the complainants their holiday pay and service incentive leave pay
for the years 1996, 1997 and 1998 as well as their premium pay for holidays and rest days and Virgilio
Agabon's 13th month pay differential amounting to TWO THOUSAND ONE HUNDRED FIFTY
(P2,150.00) Pesos, or the aggregate amount of ONE HUNDRED TWENTY ONE THOUSAND SIX
HUNDRED SEVENTY EIGHT & 93/100 (P121,678.93) Pesos for Jenny Agabon, and ONE HUNDRED
TWENTY THREE THOUSAND EIGHT HUNDRED TWENTY EIGHT & 93/100 (P123,828.93) Pesos for
Virgilio Agabon, as per attached computation of Julieta C. Nicolas, OIC, Research and Computation
Unit, NCR.

SO ORDERED.

NLRC RULING: REVERSED THE DECISION OF THE ARBITER

Petitioners had abandoned their work, and were not entitled to backwages and separation pay. The
other money claims awarded by the Labor Arbiter were also denied for lack of evidence.

CA RULING: REVERSED THE DECISION OF THE NLRC REGARDING MONEY CLAIMS

Dismissal of the petitioners was not illegal because they had abandoned their employment but ordered
the payment of money claims.

ISSUE: Whether or not the Agabons were entitled to Holiday Pay

SC RULING: AFFIRMED THE RULING OF THE CA: AGABONS ARE ENTITLED TO HOLIDAY PAY

As a general rule, one who pleads payment has the burden of proving it. Even where the employee
must allege non-payment, the general rule is that the burden rests on the employer to prove payment,
rather than on the employee to prove non-payment. The reason for the rule is that the pertinent
personnel files, payrolls, records, remittances and other similar documents – which will show that
overtime, differentials, service incentive leave and other claims of workers have been paid – are not in
the possession of the worker but in the custody and absolute control of the employer.

In the case at bar, if private respondent indeed paid petitioners' holiday pay and service incentive leave
pay, it could have easily presented documentary proofs of such monetary benefits to disprove the
claims of the petitioners. But it did not, except with respect to the 13th month pay wherein it presented
cash vouchers showing payments of the benefit in the years disputed. Allegations by private respondent
that it does not operate during holidays and that it allows its employees 10 days leave with pay, other
than being self-serving, do not constitute proof of payment. Consequently, it failed to discharge the onus
probandi thereby making it liable for such claims to the petitioners.

The Court of Appeals properly reinstated the monetary claims awarded by the Labor Arbiter ordering
the private respondent to pay each of the petitioners holiday pay for four regular holidays from 1996 to
1998, in the amount of P6,520.00, service incentive leave pay for the same period in the amount of
P3,255.00 and the balance of Virgilio Agabon's thirteenth month pay for 1998 in the amount of
P2,150.00.

FACTS:
In 2006, Petitioner hired Respondent as its delivery helper. The respondent is tasked to carry and
transport boxes to malls. In 2016, the respondent underwent cataract surgery on his left eye, which
opted him to stop working because of being unfit to work anymore. As for the petitioner, it contends that
medical certificate is needed, pursuant to Article 299 of the Labor Code, stating that the illness was
incurable within 6 months. The Certificate presented by the respondent did not contain one and
subsequently, he insisted for separation pay.
JOHN KRISKA
LOGISTICS, INC.
Respondent filed a Complaint before the LA for daily wage rates that were allegedly below minimum
Del Rosario / JOHN KRISKA
wage rate, alleged deduction of cash bond of ₱100 from his weekly wage, 13th month pay, monetary
DISTRIBUTION
claims of salary differential, SIL and attorney’s fees. For the petitioner’s defense, the respondent
13th Month CENTER INC.V.
decided not to work which removed his rights to separation pay.
Pay MENDOZA, G.R.
No. 250288,
LA RULING:
January 30, 2023
LA dismissed the Respondent’s complaint for lack of merit. It ruled that respondent was not underpaid
as his daily wage was ₱365 in. 2016 and he cannot complain for separation pay since he was not
illegally terminated.

NLRC RULING:
NLRC reversed the LA’s ruling and ordered petitioner to pay salary differential, 13th month pay
differential, SIL, cash bond and atty’s fees with total amount of ₱51,687.86. NLRC ruled that the
 petitioner failed to prove payment of wages and that meal allowance is not part of the basic salary.

CA RULING:
CA affirmed NLRC’s ruling. Hence, this petition.

ISSUE:
WON CA erred in ruling that NLRC committed no grave abuse of discretion in its ruling of
awarding monetary claims.

SC RULING:
No. The SC held that the CA was correct.

1. The NLRC assumed the correctness of Respondent’s claims SINCE it was never
rebutted by Petitioner by submitting R's pay slips (they did not deny nor present
evidence against it).
2. The NLRC was correct in excluding the meal allowance from the daily salary given that
Petitioner did not adduce any evidence showing that Respondent’s meal allowance was
paid in the form of facilities.
3. Respondent is undisputedly entitled to SIL pursuant to Section 2, Rule V, Book III of the
Omnibus Implementing Rules Implementing the Labor Code. "[e]very employee who
has rendered at least one year of service shall be entitled to a yearly service incentive
leave of five days with pay."
4. The NLRC was correct in ordering Petitioner to refund Respondent’s cash bond (100.00
x 3 yrs) pursuant to Art. 306 of the LC.
● LA greatly disregarded the 100.00 weekly deduction proof from R's pay slips
● Though they offered a check, no evidence was furnished to determine the balance of
R's cash bond (not until the NLRC ordered P to refund R's cash bond of 15,600.00)
● Pare also mistaken for arguing that NLRC should have not computed R's cash bond
only in the appeal 1) employees are not required to compute their total money claims
and present it to the LA; thus, it only surfacing before the NLRC is correct. The weekly
pay slips showing the 100.00 deductions are enough (easy math)
● Although they presented evidence of cash bond in 2013-2015 as a response to the
appeal and it may be considered as evidence, IT IS SUBJECT TO THE RULE that the
submission of such evidence does not prejudice the other party (since R has no
opportunity to present counter-evidence).
● AND it is suspicious to exclude 2016 from the evidence (where his employment was
severed). When a party refuses to provide evidence proving a material of fact to impose
liability on themselves, it is assumed that when produced it would operate to their
prejudice/interest. ALSO, by choosing not to present evidences at the earliest
opportunity, they fail to discharge the burden of proving payment.
5. The NLRC was correct in granting the 13th month pay pursuant to the 13 Month Pay
Law - an employee who has resigned or whose services were terminated at any time
before the time for payment of the 13th month pay is likewise entitled to 13th month pay
in proportion to the length of time he worked during the year. Thus, respondent is
entitled to receive his proportionate 13th month pay from January 1, 2016 to September
20, 2016.

MONETARY CLAIMS ARE GRANTED.

FACTS:

Petitioner Norma Mabeza contends that around the first week of May, 1991, she and her co-employees
at the Hotel Supreme in Baguio City were asked by the hotel’s management to sign an instrument
attesting to the latter’s compliance with minimum wage and other labor standard provisions of law.

Mabeza signed the affidavit but refused to go to the City Prosecutor’s Office to swear to the veracity
and contents of the affidavit as instructed by management. The affidavit was nevertheless submitted on
the same day to the Regional Office of the Department of Labor and Employment in Baguio City.

As gleaned from the affidavit, the same was drawn by management for the sole purpose of refuting
findings of the Labor Inspector of DOLE (in an inspection of respondent’s establishment on February 2,
1991) apparently adverse to the private respondent.
Del Rosario
Mabeza v. NLRC, After she refused to proceed to the City Prosecutor’s Office — on the same day the affidavit was
G.R. no. 118506, submitted to the Cordillera Regional Office of DOLE — petitioner avers that she was ordered by the
Payment of
April 18, 1997 hotel management to turn over the keys to her living quarters and to remove her belongings from the
Wages
hotel premises. She thereafter reluctantly filed a leave of absence from her job which was denied by
management. When she attempted to return to work on May 10, 1991, the hotel’s cashier,
Margarita Choy, informed her that she should not report to work and, instead, continue with her
unofficial leave of absence. Consequently, on May 13, 1991, three days after her attempt to return to
work, petitioner filed a complaint for illegal dismissal before the Arbitration Branch of
the National Labor Relations Commission —
CAR Baguio City. In addition to her complaint for illegal dismissal, she alleged underpayment of wages,
non-payment of holiday pay, service incentive leave pay, 13th month pay, night differential and other
benefits.

Private respondent Peter Ng alleged before Labor Arbiter Pati that petitioner “surreptitiously left (her
job) without notice to the management” and that she actually abandoned her work. He maintained that
there was no basis for the money claims for underpayment and other benefits as these were paid in the
form of facilities to petitioner and the hotel’s other employee.
 In a supplemental answer submitted eleven (11) months after the original complaint for illegal dismissal
was filed, private respondent raised a new ground, loss of confidence, which was supported by a
criminal complaint for Qualified Theft.

LA RULING:
LA dismissed the complaint for lack of confidence.

NLRC RULING:
NLRC affirmed LA’s ruling.

CA RULING:

ISSUE:
Whether or not Mabeza was underpaid of her wages.

SC RULING:

Yes. Labor Arbiter Pati accepted hook, line and sinker the private respondent’s bare claim that
the reason the monetary benefits received by petitioner between 1981 to 1987 were less than
minimum wage was because petitioner did not factor in the meals, lodging, electric
consumption and water she received during the period in her computations.

Granting that meals and lodging were provided and indeed constituted facilities, such facilities
could not be deducted without the employer complying first with certain legal requirements.

Without satisfying these requirements, the employer simply cannot deduct the value from the
employee’s ages. Requirements:
1. Proof must be shown that such facilities are customarily furnished by the trade.
2. The provision of deductible facilities must be voluntarily accepted in writing by the
employee.
3. Facilities must be charged at fair and reasonable value.

These requirements were not met in the instant case. Private respondent “failed to present any
company policy or guideline to show that the meal and lodging . . . (are) part of the salary;” he
failed to provide proof of the employee’s written authorization; and, he failed to show how he
arrived at the valuations.

Curiously, in the case at bench, the only valuations relied upon by the labor arbiter in his
decision were figures furnished by the private respondent’s own accountant, without
corroborative evidence. On the pretext that records prior to the July 16, 1990 earthquake were
lost or destroyed, respondent failed to produce payroll records, receipts and other relevant
documents, where he could have, as has been pointed out in the Solicitor General’s
manifestation, “secured certified copies thereof from the nearest regional office of the
Department of Labor, the SSS or the BIR.”

More significantly, the food and lodging, or the electricity and water consumed by the petitioner
were not facilities but supplements. A benefit or privilege granted to an employee for the
convenience of the employer is not a facility. The criterion in making a distinction between the
two not so much lies in the kind (food, lodging) but the purpose.

Considering, therefore, that hotel workers are required to work different shifts and are expected
to be available at various odd hours, their ready availability is a necessary matter in the
operations of a small hotel, such as the private respondent’s hotel.

It is therefore evident that petitioner is entitled to the payment of the deficiency in her wages
equivalent to the full wage applicable from May 13, 1988 up to the date of her illegal dismissal.

FACTS:

Respondents Alexander Parian, Jay Erinco, Alexander Canlas, Jerry Sabulao and Bernardo
Tenederowere all laborers working for petitioner Our Haus Realty Development Corporation (Our Haus),
a company engaged in the construction business.

Galang Our Haus v. Sometime in May 2010, Our Haus experienced financial distress. To alleviate its condition, they
Parian, G.R. No. suspended some of its construction projects and asked the affected workers, including respondents, to
Payment of 204651, August take vacation leaves. Later, respondents were asked to report back to work but instead of doing so,
Wages 6, 2014 they filed with the LA a complaint for underpayment of their daily wages. They claimed that except for
respondent Bernardo N. Tenedero, their wages were below the minimum rates. The respondents also
alleged that Our Haus failed to pay them their holiday, service incentive leave (SIL), 13th month and
overtime pays.

Before the Labor Arbiter, Our Haus primarily argued that the respondents’ wages complied with the
law’s minimum requirement. Aside from paying the monetary amount of their wages, Our Haus also
subsidized their meals (3 times a day), and gave them free lodging near the construction project they
were assigned to. In determining the total amount of the respondents’ daily wages, the value of these
benefits should be considered, in line with Article 97(f) of the Labor Code. Our Haus also rejected the
respondents’ monetary claims for lack of proof that they were entitled to it.

Meanwhile, the respondents argued that the value of their meals should not be considered in
determining their wages’ total amount since the requirements set under Sec. 4 of DOLE Memorandum
Circ. No. 2 were not complied with. They pointed out that Our Haus has never presented any proof that
they agreed in writing to the inclusion of their meals’ value in their wages. Also, Our Haus failed to
prove that the value of the facilities it furnished was fair and reasonable. Finally, instead of deducing the
maximum amount of 70% of the value of the meals, Our Haus actually withheld its full value (which was
P290 per week for each employee).

LA: ruled in favor of Our Haus.

Held that if the reasonable values of the board and lodging would be taken into account, the
respondents’ daily wages would meet the minimum wage rate. As to other benefits, the LA found that
the respondents were not able to substantiate their claims to it.

NLRC: reversed the LA’s decision.

Citing the Mayon Hotel v. Adana case, the NLRC noted that the respondents did not authorize Our
Haus in writing to charge the values of their board and lodging to their wages. Thus, the same cannot
be credited.

Also, the NLRC ruled that the respondents are entitled to their respective proportionate 13th month
payments for the year 2010 and SIL payments for at least three years, immediately preceding May 31,
2010, the date when the respondents left Our Haus. However, the NLRC sustained the LA’s ruling that
the respondents were not entitled to overtime pay since the exact date and time they rendered overtime
work had not been proved.

Our Haus filed an MR, submitting new evidence (five kasunduans), showing that respondents
authorized Our Haus in writing to charge the values of their meals and lodging to their wages.

Such MR was denied, thus a petition before the CA where Our Haus propounded a new theory. It made
a distinction between deduction and charging. A written authorization is only necessary if the facility’s
value will be deducted and will not be needed if it will merely be charged or included in the computation
of wages. Our Haus claimed that it did not actually deduct the values of the meals and housing benefits.
It only considered these in computing the total amount of wages paid to the respondents for purposes
of compliance with the minimum wage law. Hence, the written authorization requirement should not
apply.

CA: dismissed Our Haus’ certiorari petition and affirmed the NLRC ruling in toto.

It found no real distinction between deducing and charging, and ruled that the legal requirements before
any deduction or charging can be made to apply to both. Accordingly, it cannot consider the values of
its meal and housing facilities in the computation of the respondents’ total wages. Also, the CA ruled
that since the respondents were able to allege non-payment of SIL in their position paper, and Our
Haus, in fact, opposed it in its various pleadings, then the NLRC properly considered it as part of the
respondents’ causes of action. Lastly, the CA affirmed the respondent’s entitlement to attorney’s fees.
Our Haus’ MR was later denied. Hence, the instant petition.

ISSUES:

Whether or not there the CA erred in ruling that the legal requirements apply without distinction –
whether the facility’s value will be deducted or merely included in the computation of the wages. (NO)

RULING:

The SC ruled that there is no substantial distinction between deducting and charging a facility’s value
from the employee’s wages; that the legal requirements for credibility apply to both.

Our Haus argues that there is a substantial distinction between the deduction and the charging of a
facility’s value to the wages. Our Haus explains that in deduction, the amount of the wage (which may
already be below the minimum) would still be lessened by the facility’s value, thus needing the
employee’s consent. On the other hand, in charging, there is no reduction of the employee’s wage since
the facility’s value will just be theoretically added to the wage for purposes of complying with the
minimum wage requirement. The Court held that this is vain attempt to circumvent the minimum wage
law by trying to create a distinction where none exists.

In reality, deduction and charging both operate to lessen the actual take-home pay of an employee. In
both, the employees receive a lessened amount because supposedly, the facility’s value, which is part
of his wage, had already been paid to him in kind. As there is no substantial distinction between the
two, the requirements set by law must apply to both.

As the CA correctly ruled, these requirements are:

a) Proof must be shown that such facilities are customarily furnished by the trade;

b) The provision of deductible facilities must be voluntarily accepted in writing by the employee; and
c) The facilities must be charged at fair and reasonable value.

The Court examines Our Haus’ compliance with each requirement.

a.) The facility must be customarily furnished by the trade.

The Court concluded that one of the badges to show that a facility is customarily furnished by the trade
is the existence of a company policy or guidelines showing that provisions for a facility were designated
as part of the employees’ salaries. Our Haus presented in its MR with the NLRC the joint sinumpaang
salaysay of four of its alleged employees. These employees averred that they were recipients of free
lodging, electricity and water, as well as subsidized meals from Our Haus.

The Court agreed with the NLRC that the sinumpaang salaysay submitted are self-serving. Our Haus
only produced the documents when the NLRC had already earlier determined that Our Haus failed to
prove that it was traditionally giving the respondents their board and lodging. Moreover, the records
reveal that the board and lodging were given on a per project basis. Our Haus did not show if these
benefits were also provided in its other construction projects, thus negating its claimed customary
nature.

a.1) The purpose test in jurisprudence

Under the law, only the value of the facilities may be deducted from the employees’ wages but not the
value of supplements. Facilities include articles or services for the benefit of the employee or his family
but exclude tools of the trade or articles or services primarily for the benefit of the employer or
necessary to the conduct of the employer’s business. The law also prescribes that the computation of
wages shall exclude whatever benefits, supplements or allowances given to employees. Supplements
are paid to employees on top of their basic pay and are free of charge. Since it does not form part of the
wage, a supplement’s value may not be included in the determination of whether an employer complied
with the prescribed minimum wage rates. In the present case, the board and lodging provided by Our
Haus cannot be categorized as facilities but as supplements.

In the case of Atok-Big Wedge Assn. v. Atok-Big Wedge Co., this “facilities” and supplements” were
distinguished from one another:

"Supplements", therefore, constitute extra remuneration 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 law 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.

The benefit or privilege given to the employee which constitutes an extra remuneration above and
beyond his basic or ordinary earning or wage is a supplement; and when said benefit or privilege is part
of the laborers' basic wages, it is a facility. The distinction lies not so much in the kind of benefit or item
(food, lodging, bonus or sick leave) given, but in the purpose for which it is given. In the case at bench,
the items provided were given freely by SLL for the purpose of maintaining the efficiency and health of
its workers while they were working at their respective projects.

Ultimately, the real difference lies not in the kind of the benefit but in the purpose why it was given by
the employer. If it is primarily for the employee’s gain, then the benefit is a facility; if its provision is
mainly for the employer’s advantage, then it is a supplement. Again, this is to ensure that employees
are protected in circumstances where the employer designates a benefit as deductible from the wages
even though it clearly works to the employer’s greater convenience or advantage.

Under the purpose test, substantial consideration must be given to the nature of the employer’s
business in relation to the character or type of work performed by the employees involved.

Our Haus is engaged in the construction business, a labor intensive enterprise. In the construction
business, contractors are usually faced with the problem of meeting target deadlines. Usually, work is
performed continuously in order to finish the project on the designated turn-over date. Thus, it will be
more convenient to the employer if its workers are housed near the construction site to ensure their
ready availability during urgent or emergency circumstances. Also, productivity issues like tardiness and
unexpected absences would be minimized. This observation strongly bears in the present case since
three of the respondents are not residents of the NCR. The board and lodging provision might have
been a substantial consideration in their acceptance of employment in a place distant from their
provincial residences.

Thus, the Court concludes, under the purpose test, the subsidized meals and free lodging provided by
Our Haus are actually supplements. Although they also work to benefit the respondents, an analysis of
the nature of these benefits in relation to Our Haus’ business shows that they were given primarily for
Our Haus’ greater convenience and advantage. If weighed on a scale, the balance tilts more towards
Our Haus’ side. Accordingly, their values cannot be considered in computing the total amount of the
respondents’ wages. Under the circumstances, the daily wages paid to the respondents are clearly
below the prescribed minimum wage rates in the years 2007-2010.

b.) The provision of deductible facilities must be voluntarily accepted in writing by the employee

In the Mayon Hotel case, the Court reiterated that a facility may only be deducted from the wage if the
 employer was authorized in writing by the concerned employee. As it diminishes the take-home pay of
an employee, the deduction must be with his express consent.

In the MR with the NLRC, Our Haus belatedly submitted five kasunduans, supposedly executed by the
respondents, containing their conformity to the inclusion of the values of the meals and housing to their
total wages. Oddly, Our Haus only offered these documents when the NLRC had already ruled that
respondents did not accomplish any written authorization, to allow deduction from their wages. Also, it
was not mentioned in the sinumpaang salaysay of the four employees, that they also executed a
kasunduan for their board and lodging.

The Court then agrees with the CA that the NLRC committed no grave abuse of discretion in
disregarding these documents for being self-serving.

c.) The facilities must be charged at a fair and reasonable value

Our Haus admitted that it deducted the amount of ₱290.00 per week from each of the respondents for
their meals. But it now submits that it did not actually withhold the entire amount as it did not figure in
the computation the money it expended. From these, it appears that the total meal expense per week
for each person is ₱529.40, making Our Haus’ ₱290.00 deduction within the 70% ceiling prescribed by
the rules.

However, Our Haus’ valuation cannot be plucked out of thin air. The valuation of a facility must be
supported by relevant documents such as receipts and company records for it to be considered as fair
and reasonable. Our Haus never explained how it came up with the values it assigned for the benefits it
provided; it merely listed its supposed expenses without any supporting document. Since Our Haus is
using these additional expenses (cook’s salary, water and LPG) to support its claim that it did not
withhold the full amount of the meals’ value, Our Haus is burdened to present evidence to corroborate
its claim. The records however, are bereft of any evidence to support Our Haus’ meal expense
computation. Even the value it assigned for the respondents’ living accommodations was not supported
by any documentary evidence. Without any corroborative evidence, it cannot be said that Our Haus
complied with this third requisite.

FACTS:

LA RULING:
Manalad Millares v.
NLRC RULING:
NLRC, G.R. No.
Payment of 122827, March
CA RULING:
Wages 29, 1999
ISSUE:

SC RULING:

FACTS:

LA RULING:
Galang
Tri-C v. Matuto,
NLRC RULING:
G.R.No. 194686,
Prohibition
Sept. 23, 2015 c.
Regarding CA RULING:
Wage Order
Wages
ISSUE:

SC RULING:

FACTS:

LA RULING:
Prubankers
Manalad
Association v. NLRC RULING:
Prudential Bank,
Wage
G.R. No. 131247, CA RULING:
Distortion
Jan. 25, 1999
ISSUE:

SC RULING:

FACTS:
Manila Jockey
Petitioner Manila Jockey Club Employees Labor Union-PTGWO and respondent Manila
Ramirez Club Employees
Labor Union – Jockey Club, Inc., a corporation with a legislative franchise to conduct, operate and maintain horse
Principle of PTWGO v. races, entered into a Collective Bargaining Agreement (CBA) effective January 1, 1996 to
Non-dimuni Manila Jockey December 31, 2000. The CBA governed the economic rights and obligations of respondent’s
tion of Club, Inc., G.R. regular monthly paid rank-and-file employees. In the CBA, the parties agreed to a 7-hour work
Benefits No. 167760, schedule from 9:00 a.m. to 12:00 noon and from 1:00 p.m. to 5:00 p.m. on a work week of
March 7, 2007 Monday to Saturday.
 Accordingly, overtime on an ordinary working day shall be remunerated in an amount
equivalent to the worker's regular basic wage plus twenty-five percent (25%) thereof. Where the
employee is permitted or suffered to work on legally mandated holidays or on his designated rest day
which is not a legally mandated holiday, thirty percent (30%) shall be added to his basic wage for a
seven hour work; while work rendered in excess of seven hours on legally mandated holidays and rest
days not falling within the foretasted categories day shall be additionally compensated for the overtime
work equivalent to his rate for the first seven hours on a legally mandated holiday or rest day plus thirty
percent (30%) thereof.

On April 3, 1999, respondent issued an inter-office memorandum declaring that, effective

April 20, 1999, the hours of work of regular monthly-paid employees shall be from 1:00 p.m. to
8:00 p.m. when horse races are held, that is, every Tuesday and Thursday. The memorandum,
however, maintained the 9:00 a.m. to 5:00 p.m. schedule for non-race days.

On October 12, 1999, petitioner and respondent entered into an Amended and
Supplemental CBA retaining Section 1 of Article IV and Section 2 of Article XI, supra, and
clarified that any conflict arising therefrom shall be referred to a voluntary arbitrator for
resolution.

Subsequently, before a panel of voluntary arbitrators of the National Conciliation and Mediation
Board (NCMB), petitioner questioned the above office memorandum as violative of the
prohibition against non-diminution of wages and benefits guaranteed under Section 1, Article IV,
of the CBA which specified the work schedule of respondent's employees to be from 9:00 a.m.
to 5:00 p.m. Petitioner claimed that as a result of the memorandum, the employees are
precluded from rendering their usual overtime work from 5:00 p.m. to 9:00 p.m.

The NCMB’s panel of voluntary arbitrators, in a decision dated October 18, 2001, upheld
respondent's prerogative to change the work schedule of regular monthly-paid employees under
Section 2, Article XI, of the CBA. Petitioner moved for reconsideration but the panel denied the motion.

LA RULING:

NLRC RULING:

CA RULING:

In the herein assailed decision of December 17, 2004, the CA upheld that of the panel and denied
petitioner’s subsequent motion for reconsideration via its equally challenged resolution of April 4, 2005.

ISSUE:

Whether or not CA erred in holding that respondent MJCI did not violate the non-diminution provision
contained in article 100 of the labor code?

SC RULING:

No. The same provision of the CBA also grants respondent the prerogative to relieve employees from
duty because of lack of work. Petitioner’s argument, therefore, that the change in work schedule
violates Article 100 of the Labor Code because it resulted in the diminution of the benefit
enjoyed by regular monthly-paid employees of rendering overtime work with pay, is untenable.
Section 1, Article IV, of the CBA does not guarantee overtime work for all the employees but
merely provides that "all work performed in excess of seven (7) hours work schedule and on
days not included within the work week shall be considered overtime and paid as such."

Respondent was not obliged to allow all its employees to render overtime work
everyday for the whole year, but only those employees whose services were needed after their
regular working hours and only upon the instructions of management. The overtime pay was not
given to each employee consistently, deliberately and unconditionally, but as a compensation for
additional services rendered. Thus, overtime pay does not fall within the definition of benefits
under Article 100 of the Labor Code on prohibition against elimination or diminution of benefits.

While the Constitution is committed to the policy of social justice and the protection of the
working class, it should not be presumed that every labor dispute will be automatically decided in favor
of labor. The partiality for labor has not in any way diminished our belief that justice in every case is for
the deserving, to be dispensed in the light of the established facts and the applicable law and doctrine.

Torno Royal Plant FACTS:

Workers Union Petitioner Coca-Cola Bottlers Philippines, Inc. (CCBPI) is a domestic corporation engaged in the
Principle of v. Coca-Cola manufacture, sale and distribution of softdrink products. It has several bottling plants all over the
Non-dimuni Bottlers country, one of which is located in Cebu City. In the case of the plant in Cebu City, there are 20 bottling
tion of Philippines, Inc. operators who work for its Bottling Line 1 while there are 12-14 bottling operators who man its Bottling
Benefits - Cebu Plant, Line 2. All of them are male and they are members of herein responden, Royal Plant Workers Union
G.R. No. 198783, (ROPWU).
April 15, 2013
The bottling operators work in two shifts. The first shift is from 8 a.m. to 5 p.m. and the second shift is
from 5 p.m. up to the time production operations is finished. Thus, the second shift varies and may end
beyond eight (8) hours. However, the bottling operators are compensated with overtime pay if the shift
extends beyond eight (8) hours. For Bottling Line 1, 10 bottling operators work for each shift while 6 to 7
bottling operators work for each shift for Bottling Line 2. Prior to September 2008, the rotation is this:
after two and a half (2 ½) hours of work, the bottling operators are given a 30-minute break and this
goes on until the shift ends. In September 2008 and up to the present, the rotation has changed and
bottling operators are now given a 30-minute break after one and one half (1 ½) hours of work.

In 1974, the bottling operators of then Bottling Line 2 were provided with chairs upon their request. In
1988, the bottling operators of then Bottling Line 1 followed suit and asked to be provided also with
chairs. Their request was likewise granted. Sometime in September 2008, the chairs provided for the
operators were removed pursuant to a national directive of petitioner. This directive is in line with the "I
Operate, I Maintain, I Clean" program of petitioner for bottling operators, wherein every bottling operator
is given the responsibility to keep the machinery and equipment assigned to him clean and safe. The
program reinforces the task of bottling operators to constantly move about in the performance of their
duties and responsibilities.

With this task of moving constantly to check on the machinery and equipment assigned to him,
a bottling operator does not need a chair anymore, hence, petitioner's directive to remove them.
Furthermore, CCBPI rationalized that the removal of the chairs is implemented so that the bottling
operators will avoid sleeping, thus, prevent injuries to their persons. As bottling operators are
working with machines which consist of moving parts, it is imperative that they should not fall asleep as
to do so would expose them to hazards and injuries. In addition, sleeping will hamper the efficient flow
of operations as the bottling operators would be unable to perform their duties competently.

The bottling operators took issue with the removal of the chairs. Through the representation of herein
respondent, they initiated the grievance machinery of the Collective Bargaining Agreement (CBA) in
November 2008. Even after exhausting the remedies contained in the grievance machinery, the parties
were still at a deadlock with petitioner still insisting on the removal of the chairs and respondent still
against such measure. As such, respondent sent a Notice to Arbitrate, dated 16 July 2009, to petitioner
stating its position to submit the issue on the removal of the chairs for arbitration. Nevertheless, before
submitting to arbitration the issue, both parties availed of the conciliation/mediation proceedings before
the National Conciliation and Mediation Board (NCMB) Regional Branch No. VII. They failed to arrive at
an amicable settlement.

Opposing the Union's argument, CCBPI mainly contends that the removal of the subject chairs is a
valid exercise of management prerogative. The management decision to remove the subject chairs was
made in good faith and did not intend to defeat or circumvent the rights of the Union under the special
laws, the CBA and the general principles of justice and fair play.
ARBTRATION COMMITTEE RULING:
The A.C. rendered a decision in favor of the Royal Plant Workers Union (the Union) and against
CCBPI stating that the use of chairs by the operators had been a company practice for 34 years in
Bottling Line 2, from 1974 to 2008, and 20 years in Bottling Line 1, from 1988 to 2008; that the use of
the chairs by the operators constituted a company practice favorable to the Union; that it ripened into a
benefit after it had been enjoyed by it; that any benefit being enjoyed by the employees could not be
reduced, diminished, discontinued, or eliminated by the employer in accordance with Article 100 of the
Labor Code.

CA RULING:
The CA rendered a contrasting decision which nullified and set aside the decision of the Arbitration
Committee.It provided that the removal of the chairs from the manufacturing/production lines by CCBPI
is within the province of management prerogatives; that it was part of its inherent right to control and
manage its enterprise effectively; and that since it was the employer’s discretion to constantly develop
measures or means to optimize the efficiency of its employees and to keep its machineries and
equipment in the best of conditions, it was only appropriate that it should be given wide latitude in
exercising it.

ISSUE:
(1) Whether the action of the CCBPI of removing the chairs is a valid exercise of Management
Prerogative or not.
(2) Whether the removal of the chairs constitutes a diminution of benefits provided in Article 100 of
the Labor Code or not.

SC RULING:
(1) Yes, the Court ruled that it was a valid exercise of Management Prerogative. The Court has
held that 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. The exercise of
management prerogative, however, is not absolute as it must be exercised in good faith and with
due regard to the rights of labor.
(2) No, the Court ruled that thewe was no diminution of benefits against the employees. The
operators’ chairs cannot be considered as one of the employee benefits covered in Article 10016 of
the Labor Code. In the Court’s view, the term "benefits" mentioned in the non-diminution rule refers
to monetary benefits or privileges given to the employee with monetary equivalents. Such benefits
or privileges form part of the employees’ wage, salary or compensation making them enforceable
obligations. Let it be stressed that the aforequoted article speaks of non-diminution of supplements
and other employee benefits. Supplements are privileges given to an employee which constitute
 as extra remuneration besides his or her basic ordinary earnings and wages. From this
definition, We can only deduce that the other employee benefits spoken of by Article 100 pertain
only to those which are susceptible of monetary considerations.

FACTS:

LA RULING:
Vinoya
Republic
Planters Bank v. NLRC RULING:
Principle of
NLRC, G.R. No.
Non-dimuni
117460, January CA RULING:
tion of
6, 1997
Benefits
ISSUE:

SC RULING:

FACTS:
Arco Metal
Products, Inc. v. LA RULING:
Zagala
Samahan ng
mga NLRC RULING:
Principle of
Manggagawa sa
Non-dimuni
Arco CA RULING:
tion of
Metal-NAFLU,
Benefits
G.R. No. 170734, ISSUE:
May 14, 2008
SC RULING:

FACTS:
Petitioner is a domestic corporation engaged in in the business of manufacturing and selling of leading
nonalcoholic products and other beverages while the aggrieved employees, as represented by
respondent Iloilo Coca-Cola Plant Employees Labor Union, worked as regular route drivers and
helpers. The Collective Bargaining Agreement (CBA) between petitioner and respondent union provides
that the management has the sole option to schedule Saturday work on the basis of operational
necessity and the work rendered on a Saturday guarantees an additional 50% of their regular wage.
Petitioner later on informed respondent union that Saturday work would no longer be scheduled, citing
operational necessity as the reason for the decision. This was opposed and rejected by the officers and
members of the respondent union. Despite the opposition, petitioner pushed through with the
non-scheduling of Saturday work.

Respondent union brought its grievances to the office of National Conciliation and Mediation Board. The
NCMB ruled in favor of petitioner.
LA RULING:

NLRC RULING:

CA RULING:
The Court of Appeals reversed the decision of the NCMB, finding that the CBA gave the employees the
right to compel CCBPI to give work on Saturdays; that the scheduling of work on a Saturday had
Coca-Cola ripened into a company practice; and that the subsequent withdrawal of Saturday work constituted a
Bottlers prohibited diminution of wages.
Philippines, Inc. Petitioner argues that based on the provisions of its CBA, specifically Article 10, Section 1, in relation
Cabantog
vs. Iloilo with, Article 11, Section 1 (c) and Section 2(c), it is clear that work on a Saturday is optional on the part
Coca-cola Plant of management, and constitutes a legitimate management prerogative that is entitled to respect and
Principle of
Employees enforcement in the interest of simple fair play. On the other hand, respondent union contends that
Non-dimuni
Labor Union petitioner failed to regard the express provision of the CBA which delineates petitioner's normal
tion of
(ICCPELU, G.R. work-week which consists of five (5) consecutive days (Monday to Friday) or eight hours each and one
Benefits
No. 195297, day (Saturday) of four hours
December 5,
2018 ISSUES:
1) Whether or not the scheduling of Saturday work for petitioner's employees is mandatory on the
part of the company under the CBA between the parties
2) Whether scheduling Saturday work has ripened into a company practice, the removal of which
constituted a diminution of benefits

SC RULING:
1) No, scheduling of Saturday work is not mandatory. The literal meaning of the stipulations of the CBA,
as with every other contract, control if they are clear and leave no doubt upon the intention of the
contracting parties. It is a rule in interpretation of contracts that the various stipulations of a contract
shall be interpreted together, attributing to the doubtful ones that sense which may result from all of
them taken jointly. The Court finds that a more logical and harmonious interpretation of the CBA
provisions wherein Saturday work is optional and not mandatory keeps more with the agreement
between the parties. In Article 10 of the CBA, the company work week is elaborated while also defining
how a Saturday is treated and in fact delineating the same from the other days of the work week.
However, under Article 11, Section 1(c), clearly provides that CCBPI has the option to schedule work on
Saturdays based on operational necessity. The phrase “schedule work on Saturdays based on
operational necessity,” by itself, is union recognition that there are times when exigencies of the
business will arise requiring a manning complement to suffer work for four additional hours per week.
When no such exigencies exist, the additional hours of work need not be rendered.

2) No, the removal of Saturday work is not violative of the principle of non-diminution of benefits. It is
 not Saturday work per se which constitutes a benefit to the company's employees. Rather, the benefit
involved in this case is the premium which the company pays its employees above and beyond the
minimum requirements set by law. The CBA between petitioner and respondent union guarantees the
employees that they will be paid their regular wage plus an additional 50% thereof for the first eight
hours of work performed on Saturdays. The benefit, if ever there is one, is the premium pay given by
reason of Saturday work, and not the grant of Saturday work itself. In order for there to be proscribed
diminution of benefits that prejudiced the affected employees, petitioner should have unilaterally
withdrawn the 50% premium pay without abolishing Saturday work. These are not the facts of the case
at bar. Petitioner withdrew the Saturday work itself pursuant to its management prerogative. In fact, this
management prerogative highlights the fact that the scheduling of the Saturday work was actually made
subject to a condition – the prerogative to provide the company's employees with Saturday work based
on the existence of operational necessity. The CBA between petitioner and respondent has no
analogous provision which grants that the 50% premium pay would have to be paid regardless of the
occurrence of Saturday work. Thus, the non-payment of the same would not constitute a violation of the
diminution of benefits rule. Even assuming arguendo that the Saturday work involved in this case falls
within the definition of a “benefit” protected by law, the fact that it was made subject to a condition (i.e.,
the existence of operational necessity) negates the application of Article 100 pursuant to the
established doctrine that when the grant of a benefit is made subject to a condition and such condition
prevails, the rule on non-diminution finds no application.

FACTS:

LA RULING:
Chan
Auto Bus v.
NLRC RULING:
Bautista,
Service
G.R.No. 156367,
Incentive CA RULING:
May 16, 2005
Leave
ISSUE:

SC RULING:

FACTS:

LA RULING:
Mejila v. Wrigley
Dela Cruz
Philippines, Inc., NLRC RULING:
G.R. No. 199469,
Garden
September 11, CA RULING:
Leave
2019
ISSUE:

SC RULING:

Daguinod v.
Southgate
Foods, Inc.,
represented by
Maureen O. FACTS:
Ferrer and
Generation One LA RULING:
Resource
Del Rosario Service and NLRC RULING:
Multi-Purpose
Liabilities Cooperative,[*] CA RULING:
Represented by
Resty Cruz, ISSUE:
Respondents,
G.R. No. 227795 SC RULING:
(Formerly
Udk-15556),
February 20,
2019

FACTS:

LA RULING:
Mago v. Sun
Power
Galang NLRC RULING:
Manufacturing
Limited, G.R. No.
Liabilities CA RULING:
210961, January
24, 2018
ISSUE:

SC RULING:

FACTS:
Allied Banking
Manalad Corp. v.
LA RULING:
Calumpang, G.R.
Liabilities No. 219435,
NLRC RULING:
January 17, 2018
 CA RULING:

ISSUE:

SC RULING:

FACTS:

LA RULING:
Lingat vs.
Coca-Cola
Ramirez NLRC RULING:
Bottlers,
Philippines, G.R.
Liabilities CA RULING:
No. 205688, July
4, 2018
ISSUE:

SC RULING:

FACTS:

LA RULING:
Philippine Pizza,
Torno Inc. Porras,
NLRC RULING:
et.al., G.R. No.
Liabilities 230030, August
CA RULING:
29, 2018
ISSUE:

SC RULING:

FACTS:
Lingnam
Restaurant vs.
LA RULING:
Skills & Talents
Employment
Vinoya NLRC RULING:
Pool, Inc. (STEP)
& Jessie
Liabilities CA RULING:
Colaste, G.R.
No. 214667,
ISSUE:
December 3,
2018
SC RULING:

FACTS:
Martinez, et. al.
LA RULING:
v. Magnolia
Poultry
Zagala NLRC RULING:
Processing
Plant, G.R. Nos.
Liabilities CA RULING:
231579 and
231636, June 16,
ISSUE:
2021
SC RULING:

FACTS:

LA RULING:
MCC-ELU-OLAIA
v. MCC and MSI,
Cabantog NLRC RULING:
G.R. Nos.
242495-96,
Liabilities CA RULING:
September 16,
2020
ISSUE:

SC RULING:

FACTS:
Conqueror
LA RULING:
Industrial Peace
Management
Chan NLRC RULING:
Cooperative V.
Balingbing, et al,
Liabilities CA RULING:
G.R. No. 250311,
250501, January
ISSUE:
5, 2022
SC RULING:

Dela Cruz Servflex, Inc. V.

FACTS:
Urera, et. al. G.R.
Liabilities No. 246369
March 29, 2022 LA RULING:

NLRC RULING:

CA RULING:

ISSUE:

SC RULING: