20.
SAMEER OVERSEAS PLACEMENT - CA: affirmed NLRC decision on finding of
AGENCY v. CABILES
- Joy Cabiles submitted application for a
quality control job in Taiwan -> application
was accepted -> asked to sign a 1-year
employment contract -> alleged that
petitioner required her to pay a placement
fee of 70k when she signed the employment
contract
- Joy was deployed to work for
TaiwanWacoal and alleged that in her
employment contract, she agreed to work as
quality control for 1 year -> In Taiwan, she
was asked to work as a cutter
- Pet. Claims that a Mr. Huwang from
Wacoal informed Joy without prior notice,
that she was terminated and that she should
immediately report to their office to get her
salary and passport -> asked to prepare for
immediate repatriation
- Went back to Manila -> filed a complaint
with NLRC -> claimed that she was illegally
dismissed and asked for the return of her
placement fee, withheld repatriation costs,
payment of her salary for 23 months, and
moral and exemplary damages
- Pet alleged that Joy’s dismissal was due to
her inefficiency, negligence in her duties,
and her failure to comply with the work
requirements of her foreign employer ->
claimed that it did not ask Joy for placement
fee of 70k
- Pet. Alleged that Wacoal’s accreditation
with pet has already been transferred to the
Pacific Manpower and Mgmt Svcs and
asserts that it was already substituted by
Pacific -> Pacific moved for the dismissal of
pet’s claims against it -> no EER between
them and therefore, the claims against it
were outside the juris of LA -> Pacific
argued that the employment contract should
first be presented so that the employer’s
contractual obligations might be identified
-> denied that it assumed liability for the
petitioner’s illegal acts
- LA: dismissed Joy’s complaint and
declared that her complaint was based on
mere allegations -> found that there was no
excess payment of placement fees based on
the OR presented by Pet.
- NLRC: declared that Joy was illegally
dismissed -> reiterated doctrine that burden
of proof to show that the dismissal was
based on a just or valid cause belongs to the
employer -> Pet. Failed to prove just causes
for termination
illegal dismissal, Joy’s entitlement of 3
months worth of salary, reimbursement of
withheld repatriation expenses, and atty’s
fees
- SC: Pet failed to show that there was just
cause for the dismissal -> security of tenure
is guaranteed by our Consti. -> Pet’s
allegation that R was inefficient in her work
and negligent in her duties may constitute a
just cause for termination under Art. 282(b)
of LC, BUT only if pet was able to prove it ->
pet merely alleged that R failed to comply
with her foreign employer’s work
requirements and was inefficient in her
work -> NO evidence was shown to support
such allegations
- R, having been illegally dismissed, is
entitled to her salary for the unexpired
portion of the employment contract that was
violated together with atty’s fees and
reimbursement of amounts withheld from
her salary
- Sec 10 RA 8042 states that overseas
workers who were terminated without just,
valid, or authorized cause shall be entitled
to the full reimbursement of his placement
fee with interest of 12% per annum, plus his
salaries of the unexpired portion of his
employment contract
- RA 8042 ensures that overseas workers
have recourse in law despite the
circumstances of their employment. By
providing that the liability of the foreign
employer may be enforced to the full extent
against the local agent, the overseas worker
is assured of immediate and sufficient
payment of what is due them -> The local
agency that is held to answer for the
overseas worker’s money claims is not left
without remedy. The law does not preclude
it from going after the foreign employer for
reimbursement of whatever payment it has
made to the employee to answer for the
money claims against the foreign employer
- With the present state of the pleadings, it is
not possible to determine whether there was
indeed a transfer of obligations from pet to
Pacific -> This should NOT be an obstacle
for the respondent overseas worker to
proceed with the enforcement of this
judgment -> Pet is possessed with the
resources to determine the proper legal
remedies to enforce its rights against Pacific,
if any.
21. MAERSK-FILIPINAS CREWING v.
AVESTRUZ

- Avestruz was hired by Pet as Chief Cook
on board vessel M/V Nedlloyd Drake for 6
months for foreign employer AP Moller
Singapore
- Weekly inspection of the vessel’s galley”
Capt Woodward noticed that the cover of
the garbage bin in the kitchen was oily ->
Capt Woodward called Avestruz (part of his
job was to ensure the cleanliness of the
galley) and asked him to stand near the
garbage bin -> Capt took Avestruz’s hand
and swiped it on the oily cover of the
garbage bin telling him to feel it -> Avestruz
said that if he wanted them to clean it then
they would clean it -> Capt replied by
shoving him on the chest and Avestruz
complained and told him not to touch him
-> argument ensued
- Afternoon: Capt summoned and required
Avestruz to state in writing what transpired
in the galley that morning -> complied and
submitted his written statement -> on same
day, Capt informed Avestruz that he would
be dismissed from service and be
disembarked in India
- Avestruz arrived in Phils -> filed a
complaint for illegal dismissal, payment for
the unexpired portion of his contract,
damages, and atty’s fees against Maersk,
employer, and Agbayani, an officer of
Maersk -> alleged that no investigation or
hearing was conducted nor was he given the
chance to defend himself before he was
dismissed -> Capt failed to observe the
provisions under POEA-SEC on disciplinary
procedures -> averred that he was not given
any notice stating the ground for his
dismissal
- Pet claimed that during R’s stint on the
vessel, R failed to attend to his tasks,
specifically to maintain the cleanliness of the
galley, which prompted Capt to issue
weekly reminders -> Despite reminders, R
still failed to comply with his duty -> R was
informed of his dismissal from service due
to insubordination -> Caot sent two emails
to Maersk explaining the decision to
terminate R’s employment and requesting
for his replacement
- LA: dismissed R’s complaint -> found that
R failed to perform his duty of maintaining
cleanliness in the galley and that he also
repeatedly failed to obey the directives of
his superior, which was tantamount to
insubordination
- NLRC: sustained validity of R’s dismissal
but found that Pet failed to observe the
procedures laid down in Sec 17 of the
POEA-SEC -> records are bereft of evidence
showing compliance with the rules, NLRC
held Pet jointly and severally liable to pay R
30k for nominal damages
- CA: reversed and set aside the rulings of
NLRC -> found R to have been illegally
dismissed -> directed pet to pay him, jointly
and severally, the full amount of his
placement fee and deductions made, with
interest at 12% per annum, as well as his
salaries for the unexpired portion of his
contract and atty’s fees of 10% of total award
-> NO factual basis for the charge of
insubordination which Pet claimed was the
ground for R’s dismissal
- SC: CA did not err in reversing and setting
aside the factual conclusions of the labor
tribunals that R’s dismissal was lawful ->
NO just or valid cause for his dismissal ->
emails sent by the Capt to Maersk were
uncorroborated and self-serving, and
therefore, do not satisfy the requirement of
substantial evidence as would sufficiently
discharge the burden of proving that R was
legally dismissed -> pet failed to prove that
R committed acts of insubordination which
would warrant his dismissal
- With respect to the monetary awards given
to R, SC finds the same to be in consonance
with Sec. 10 of RA 8042: “In case of
termination of overseas employment
without just, valid, or authorized cause as
defined by law or contract, or any
unauthorized deductions from the migrant
worker’s salary, the worker shall be entitled
to the fill reimbursement of his placement
fee and the deductions made with the
interest at 12% per annum, plus his salaries
for the unexpired portion of his employment
contract.
COMPULSORY INSURANCE
COVERAGE
Sec. 37-A RA 8042, added by RA 10022:
G.R.: Each migrant worker deployed by a
recruitment/manning agency shall be
covered by a compulsory insurance policy
which shall be secured at no cost to the said
worker.
XPT: Insurance coverage is optional when
the migrant worker is classified as a rehire,
name hire, or direct hire, in which case they
may request their foreign employer to pay
for the cost of the insurance coverage, or
they may pay for it themselves (Sec. 14,
Omnibus Rules Implementing RA 10022).
Coverage (minimum values)
• Accidental death ($10,000.00);
• Permanent total disablement
($7,500.00);
• Repatriation and transport of
personal belongings when
termination is without valid
cause;
• Subsistence allowance benefit
($100.00);
• Money claims arising from
employer’s liability (3 months for
every year of the employment
contract);
• Additional inclusions
• Compassionate visit (when
hospitalized and confined for at
least 7 consecutive days);
• Medical evacuation (when an
adequate medical facility is not
available proximate to the
worker);
• Medical repatriation (when
medically necessary as
determined by the attending
physician) Obligation to pay
premiumsThe obligation rests
with the employer. Should there
be a finding that the migrant
worker paid for the premium,
the agency shall lose its license
and all its directors, partners,
proprietors, officers and
employees shall be perpetually
disqualified from engaging in the
business of recruitment of
overseas workers.
V. HOURS OF WORK
22. RADA v. NLRC
- Pet initial employment with R was under a
contract of employment for a definite period
-> hired as driver for the construction
supervision phase of the Manila North
Expressway Extension (MNEE Stage 2) ->
term of about 24 months
- First contract of employment expired ->
MNEE stage 2 project was not finished
because of various contraints -> project
extended and remained in progress beyond
the original period of 2.3 years
- At the time the first contract expired, R was
in need of a driver for the extended project
-> since pet had the necessary experience
and his performance under the first contract
of employment was found satisfactory,
position of driver was offered to Pet -> pet
accepted -> second contract of employment
for a definite period of 10 months was
executed
- A part of the project was completed but the
bulk of it was yet to be finished -> pet was
among those whose contract was about to
expire and since his service performance
was satisfactory, R renewed his contract of
employment -> 3rd contract of employment
for a definite period of 19 months as driver
was executed
- 3rd contract of employment was
subsequently extended for a number of
times, the last extension for a period of 3
months
- Last extension was not extended any
further because Pet had no more work to do
in the project -> confirmed by a notice and
duly acknowledged by Pet
- Pet applied for personnel clearance with R
and acknowledged having rcvd amount of
P3796.20 as conversion to cash of unused
leave credits and financial assistance -> Pet
also released R from all obligations and/or
claims, etc.
- A few months later, pet filed before NLRC
a complaint for non-payment of separation
pay and overtime pay ->Philnor (one of R)
alleged that pet was not illegally terminated
since the project was completed ->he was
hired under three distinct contracts for
definite period and strictly confined to one
project -> pet did not render OT services and
that there was no demand or claim for him
for such OT pay -> he signed a “release,
waiver, and quitclaim” releasing Philnor
from all obligations and claims
- Pet claimed that he was illegally dismissed
since he was a regular employee entitled to
security of tenure and not a project
employee since Philnor is not engaged in the
construction business -> his position as
driver was essential, necessary and desirable
to the conduct of the business of Philnor ->
he rendered OT work until 6pm daily except
Sundays and holidays and was entitled to
OT pay
- Pet claimed that he was a regular employee
pursuant to Art. 278© LC and cannot be
terminated except for a just cause under Art.
280
- LA: ordered R to reinstate Pet to his former
position without losses of seniority rights
and other privileges with full backwages
from the time of his dismissal to his actual
reinstatement -> directed R to pay Pet OT
pay for the excess 3 hours of work
performed during work days
- NLRC: set aside LA decision and
dismissed pet’s complaint
- SC: Pet is entitled to OT compensation. The
fact that he picks up employees of Philnor at
certain points in EDSA in going to the
project site and drops them off at the same
points on his way back from the field office
going home to Marikina is not merely
incidental to pet’s job as a driver -> the
trasnpo arrangement had been adopted, not
so much for the convenience of the
employees, but primarily for the benefit of
the employer (R)
- R does not hesitate to admit that it is
usually the project driver who is tasked with
picking up or dropping off his fellow
employees -> when pet is absent another
driver is supposed to replace him and drive
the vehicle and likewise pick up and/or drop
off the other employees at the designated
points on EDSA -> if driving these
employees to and from the project site is not
really part of the pet’s job, then there would
have been no need to find a replacement
driver to fetch the employees
- Since the assigned task of fetching and
delivering employees is INDISPENSABLE
and consequently MANDATORY, then the
time required of and used by pet in going
from his residence to the field office and
back (from 5:30am-7am and from 4pm-
6pm), which the LA rounded off as
averaging 3 hours each working day, should
be paid as OT work -> pet should be given
OT pay for the three excess hours of work
performed during working days
23. UNIVERSITY OF PANGASINAN
FACULTY UNION v. UNIVERSITY OF
PANGASINAN
- Pet is a labor union composed of faculty
members of R -> through its pres., pet filed a
complaint against R with NLRC for
payment of emergency cost of living
allowances (ECOLA); salary increase from
the 60% of the incremental proceeds of
increased tuition fees; and payment of
salaries for suspended extra loads
- In Nov and Dec 1981, pet’s members were
fully paid their regular monthly salaries ->
however, during the semestral break (nov 7-
dec 5), they were not paid their ECOLA -> R
claims that the teachers are not entitled
because the semestral break is not an
integral part of the school year and there
being no actual services rendered by the
teachers during said period, the principle
“no work, no pay” applies
- During same school year, R was
authorized by the Ministry of Education and
Culture to collect from its students 15%
increase of tuition fees -> pet’s members
demanded a salary increase effective the 1st
semester of said schoolyear to be taken from
60% incremental proceeds of the increased
tuition fees -> R refused -> this compelled
pet to include this demand in the complaint
filed in the instant case
- While complaint pending: R granted an
across-the –board salary increase of 5.86% ->
Pet still pursued full distribution of the 60%
of the incremental proceeds as mandated by
PD 451
- Aside from their regular loads, some of
pet’s members were given extra loads
during SY 1981-1982 and the claimed that
they were not paid for these loads
- SC: For ECOLA issue- it is beyond dispute
that the pet’s members are full-time
employees rcving their monthly salaries
irrespective of the number of working days
or teaching hours in a month -> Semestral
breaks are in the nature of work
interruptions beyond the employee’s
control. -> These breaks cannot be
considered as absences within the meaning
of the law for which deductions may be
made from monthly allowance -> The “no
work, no pay” principle does not apply in
the instant case
- It is clear the provisions of law that it
contemplates a “no work” situation where
the employees voluntarily absent
themselves -> Pet certainly do not absent
themselves during semestral breaks -> they
are constrained to take mandatory leave
from work and cannot be faulted nor can
they be begrudged that which is due them
under the law -> it was not the intention of
the framers of the law to allow employers to
withhold employees benefits by the simple
expedient of unilaterally imposing “no
work” days and consequently avoiding compensable. A shorter mealtime (at least 20
compliance with the mandate of the law for mins) is allowed provided such mealtime is
those days credited as compensable (Sec. 5, DO 182-17)
- The intention of the law is to grant ECOLA
upon the payment of basic wages -> Hence, XPT: If they are required by the nature of
we have the principle of “No pay, no their work to work for 6 days (48 hours),
ECOLA” -> Pet cannot be considered to be they are entitled to additional compensation
on leave without pay so as not to be entitled of at least 30% of their regular wage for the
to ECOLA because the pet were paid their th
work on the 6 day.
wages in full for the months of Nov and
Dec, notwithstanding the intervening
See: DO 182-17
semestral break
- Although they may be considered by the R
24. SAN JUAN DE DIOS HOSPITAL
to be on leave, the semestral break could not
EMPLOYEES ASSOC. v. NLRC
be used effectively for the teacher’s own
purposes for the nature of a teacher’s job
- Pet. Sent a 4-page letter with attached
imposes upon him further duties which
supported signatures to San Juan De Dios
must be done during the said period of time
Hospital (SJDDH) requesting and pleading
-> Learning is a never-ending process,
for the expeditious implementation and
teachers and professors must keep abreast of
payment of the 40-hours/5-day workweek
developments all the time -> Teachers also
with compensable weekly 2 days off
cannot wait for the opening of the next
provided by RA 5901 -> hospital failed to
semester to begin their work
give a favorable response -> pet filed a
- Unfair for the R to consider these teachers
complaint regarding their claims for
as employees on leave without pay to suit its
statutory benefits with NLRC
purposes and yet, in the meantime, continue
- LA: dismissed the complaint of pet
availing their services as they prepare for
- NLRC: affirmed LA decision
the next semester or complete all of the last
- core issue is whether Policy instructions
semester’s requirements
no. 54 issued by then DOLE Sec is valid or
- The semestral break is an interruption
not
beyong pet’s control and it cannot be used
- SC: Policy Instruction No. 54 relies and
effectively nor gainfully in the employee’s
purports to implement RA 5901 -> reliance
interest -> thus, the sem break may also be
of RA 5901 is misplaced bec it has long been
considered as hours worked
repealed with the passage of the LC
- For this, the teachers are paid regular
- Only Art. 83 LC which appears to have
salaries and, for this, they should be entitled
substantially incorporated or reproduced
to ECOLA ->not only do the teachers
the basic provisions of RA 5901 may support
continue to work during this short recess
Policy instructions no. 54 on which the
but much less do they cease to live for which
latter’s validity may be gauged
the cost of living allowance is intended.
- A reading of Art 83 betrays pet’s position
that hospital employees are entitled to a full
EXCEPTION: HEALTH PERSONNEL
weekly salary with paid 2 days off if they
have completed a 40 hour/5 day work week
Art. 83 LC: Health personnel- resident
-> Art 83 merely provides: the regular office
physicians, nurses, nutritionists, dieticians,
hour of 8 hours a day, 5 days a week for
pharmacists, social workers, laboratory
health personnel; and where the exigencies
technicians, paramedical technicians,
of service require that health personnel
psychologists, midwives, attendants, and all
work for 6 days or 48 hours then such health
other hospital or clinic personnel.
personnel shall be entitled to an additional
compensation of at least 30% of their regular
G.R.: Those personnel in cities and
wage for work on the 6th day
municipalities with a population of at least
- There is nothing in the law that supports
1,000,000 OR in hospitals and clinics with a
the assertion that personnel in subject
bed capacity of at least 100 are subject to the
hospitals and clinics are entitled to a full
40-hour/5-day workweek at 8 hours of work
weekly wage for 7 days if they have
per day exclusive of mealtime. (Art. 83 LC)
completed the 40 hour/5 day work week in
any given work week
- Mealtime is at least 1-hour and is non-
. DOLE Sec exceeded his authority by
including a 2 days off with pay in
contravention of the clear mandate of the
statute
COMPRESSED WORKWEEKS
NOTE: Compressed workweeks are not
allowed in health services or in
occupations/workplaces where employees
are exposed to airborne contaminants,
human carcinogens, substances, chemicals,
or noises that exceed threshold limit values
or tolerance levels for an 8-hour workday as
prescribed under the Occupational Safety
and Health Standards pursuant to DOLE
DA 02-2004 (Sec. 9, DO 182-1&).
Flexible Work Arrangements
Definition: Alternative arrangements or
schedules other than the traditional or
standard work hours, workday, and
workweek.
Conditions for validity:
• Voluntary agreement by the workers to
work more than 8 hours/day, as
long as the total hours per week
does not exceed their normal
weekly hours;
• No diminution in the weekly or monthly
pay and benefits;
• Working in excess of the normal weekly
hours prior to the adoption of the
compressed workweek scheme still
entitles the employee to overtime
pay;
• Appropriate waivers with respect to
overtime premium pay
• Effectivity and implementation of the new
working time arrangement is by
agreement of the parties (D.O. 21).
Effects of a CWW:
24. PHILIPPINE GRAPHIC ARTS v. NLRC
- Pet was forced by economic circumstances
to require its workers to go on mandatory
vacation leave in batches of 7 or 9 for
periods ranging from 15, 30, to 45 days ->
workers were paid while on leave but the
pay was charged against their respective
earned leaves
- private R filed complaints of unfair labor
practice and discrimination
- LA: complaint dismissed
- NLRC: affirmed LA decision with
modification -> the vacation leave forced
upon the complainants was visited with
arbitrariness NOT amounting to unfair labor
practice -> a refund of the amount
equivalent to the earned leave of each of the
complainants treated as their pay during
their vacation leave is in order
- SC: there was no unfair labor practice ->
private R themselves never questioned the
existence of an economic crisis -> there is
basis for pet’s contentions that the reduction
of work schedule was temporary, that it was
taken only after notice and consultations
with the workers and supervisors, that a
consensus was reached on how to deal with
deteriorating economic conditions and
reduced sales and that the temporary
reduction of working days was a more
humane solution instead of retrenchment
and reduction of personnel
- No showing that the imposition of forced
leave was exercised for the purpose of
defeating or circumventing the rights of
employees under special laws or under
valid agreements -> pet instituted the forced
leave due to economic crisis which private R
do not even question
- Forced leave was neither enforced in a
malicious, harsh, oppressive, vindictive, nor
wanton manner, or out of malice or spite ->
what only hurts private R is that said
mgmt’s plan was not even discussed in the
grievance procedure so that the Union
members thereof may well be apprised of
the reason therefor
25. UNICORN SAFETY GLASS v.
BASARTE
- R were regular employees of pet -> R
normally worked 6x a week, Mon-Sat, and
were paid on a weekly basis -> R were also
officers of the organized union in pet
company
- gen mgr of Unicorn issued Memorandum
informing R that their workdays shall be
reduced due to economic considerations ->
R registered their protest to the proposed
reduction of working days and expressed
doubts on the reasons offered by the
company -> R surmised that mgmt. was
merely getting back at them for forming a
union especially since only the union
officers were affected by the work reduction
- general mgr issued another memorandum
announcing the implementation of a work
rotation schedule, which will effectively
reduce R’s workdays to merely 3 days a
week -> R wrote another letter of protest ->
were told that it was mgmt’s prerogative to
do so
- Instead of reporting for work, R filed a
complaint against pet with MLRC for
constructive dismissal and unfair labor
practice -> R prayed for reinstatement and
payment of full backwages -> since they
failed to report to work, pet sent each of R a
telegram directing them to do so -> R sent
the general mgr a letter informing him that,
in view of the mgmt’s apparent indifference
to their plight and blatant violation of their
rights, a complaint was lodged against pet
for constructive dismissal
- LA: found that R were not constructively
dismissed by pet -> also dismissed the
charge of unfair labor practice for lack of
legal and factual basis -> Nonetheless, LA
ordered pet to pay R unpaid service
incentive leave pay
- NLRC: sustained LA findings
- CA: pet were ordered to reinstate R to their
former positions without loss of seniority
rights and privileges and to pay their full
backwages until their reinstatement OR to
award them with separation pay in case
reinstatement is no longer feasible or
possible
- SC: agrees with CA that pet’s bare
assertions on the alleged reason for the
rotation plan as well as its failure to refute
R’s contention that they were targeted due
to their union activities, merit the reversal of
the LA decision -> incumbent upon pet to
prove that the rotation scheme was a
genuine business necessity and not meant to
subdue the organized union -> the reasons
enumerated by pet in their memoranda
were factors too general to actually
substantiate the need for the scheme -> pet
cite the reduction in their electric
consumption as proof of an economic slump
-> this may be true to an extent but it does
not, by itself, prove that the rotation scheme
was the most reasonable alternative to
remedy the company’s problems
- pet’s unbending stance on the
implementation of the rotation scheme was
an indication that the rotation plan was
being implemented for reasons other than
business necessity -> R attempted on more
than one occasion to have a dialogue with
pet to discuss the work reduction -> good
faith should have prompted the general mgr
to hear the side of the R, to come up with a
scheme amenable to both parties or attempt
to convince the employees concerned that
there was no other viable option ->
HOWEVER, pet ignored the letters sent by
R, which compelled the latter to seek redress
with the LA
- the Court has always respected a
company’s exercise of its prerogative to
devise means to improve its operations ->
however, the exercise of mgmt prerogative
is not absolute -> it must be exercised in
good faith and with due regard to the rights
of labor -> the prerogative accorded to
mgmt. cannot defeat the very purpose for
which our labor laws exist: to balance the
conflicting interests of labor and mgmt., not
to tilt the scale in favor of one over the other,
but to guaranty that labor and mgmt. stand
on equal footing when bargaining in good
faith with each other
- the manner by which pet exercised their
mgmt. prerog. appears to be an
underhanded circumvention of the law ->
pet were keen on summarily implementing
the rotation plan, obviously singling out R
who were all union officers -> the mgmt’s
apparent lack of interest to hear what the R
had to say created an uncertain situation
where reporting for work was tantamount
to an acquiescence in an unjust situation
- R cannot be said to have abandoned their
jobs when precisely, the root cause of their
protest is their demand to maintain their
regular work hours -> R even prayed for
reinstatement and backwages => these are
INCOMPATIBLE with the proposition that
R sought to abandon their work
- Art 279 LC provides that an employee who
is unjustly dismissed from work is entitled
to reinstatement without loss of seniority
rights and other privileges, and to his full
backwages -> However, if reinstatement is
no longer possible, the employer has the
alternative of paying the employee his
separation pay in lieu of reinstatement
26. LINTON COMMERCIAL v. HELLERA
- pet issued a memorandum addressed to its
employees informing them of the company’s
decision to suspend its operations die to the
currency crisis that affected its business
operations -> pet submitted an
establishment termination report to DOLE
regarding the temporary closure of the
establishment -> company’s operation was
to resume jan 6, 1998
- pet issued another memorandum
informing employees that it would
implement a new compressed workweek of
3 days on a rotation basis -> each worker
would be working on a rotation basis for 3
working days only instead of 6 days a week
-> pet submitted an establishment
termination report concerning the rotation
of its workers and proceeded with the
implementation of the new policy without
waiting for DOLE’s approval
- 68 workers filed a complaint for illegal
reduction of workdays with the NLRC ->
pointed out the pet implemented the
reduction of workdays without observing
Art 283 LC which required submission of
notice to DOLE 1 month prior to the
implementation of reduction of personnel ->
pet filed only the establishment termination
report on the very date of its
implementation
- pet contended that the devaluation of the
peso created a negative impact in
international trade and affected their
business bec a majority of their raw
materials were imported -> pet decided to
reduce the working days of its employees to
3 days on rotation as a cost-cutting measure
-> alleged that the compressed workweek
was actually implemented on Jan 12 and not
Jan 7 and that Art 283 was not applicable
- LA: foung pet guilty of illegal reduction of
work hours and directing them to pay each
of their workers their 3 days/week’s worth
of work compensation
- NLRC: reversed decision of LA -> an
employer has the prerog to control all
aspects of employment in its business
organization, including the supervision of
workers, work regulation, lay-off workers,
dismissal and recall of workers -> took
judicial notice of the Asian currency crisis
and found pet’s decision to implement a
compressed workweek as a valid exercise of
mgmt. prerog
- CA: reversed NLRC decision -> the
employees were constructively dismissed
bec the short period of time between the
submission of the establishment termination
report informing DOLE of its intention to
observe a compressed workweek and the
actual implementation was a manifestation
of pet to eventually retrench the employees
-> pet failed to establish enough factual basis
to justify the necessity of a reduced
workweek
- MAIN ISSUE: WON there was an illegal
reduction of work when pet implemented a
compressed workweek
- SC: The Bureau of Working Conditions of
the DOLE released a bulletin providing for
in determining when an employer can
validly reduce the regular number of
working days -> reduction of number of
regular working days is valid where the
arrangement is resorted to by the employer
to prevent serious losses due to causes
beyond his control, such as when there is a
substantial slump in the demand for his
goods or services or when there is a lack of
raw materials-> the bulletin has one main
consideration in determining the validity of
reduction of working hours: that the
company was suffering from losses
- An examination of pet’s financial reports
show that while the company suffered a
loss, it retained a considerable amount of
earnings and operating income -> permitting
reduction of work and pay at the slightest
indication of losses would be contrary to the
State’s policy to afford protection to labor
and provide full employment
- If the standards set in determining the
justifiability of financial losses under Article
283 (i.e., retrenchment) or Article 286 (i.e.,
suspension of work) of the Labor Code were
to be considered, petitioners would end up
failing to meet the standards. -> Article 286
applies only when there is a bona fide
suspension of the employer’s operation of a
business or undertaking for a period not
exceeding six (6) months -> Records show
that Linton continued its business
operations during the effectivity of the
compressed workweek, which spanned
more than the maximum period -> and for
retrenchment to be justified, any claim of
actual or potential business losses must
satisfy the following standards: (1) the losses
incurred are substantial and not de minimis;
(2) the losses are actual or reasonably
imminent; (3) the retrenchment is
reasonably necessary and is likely to be
effective in preventing the expected losses;
and (4) the alleged losses, if already
incurred, or the expected imminent losses
sought to be forestalled, are proven by
sufficient and convincing evidence -> pet
failed to comply with these standards.
=> the compressed workweek arrangement
was unjustified and illegal; pet committed
illegal reduction of work hours
27. BISIG MANGGAGAWA SA TRYCO v.
NLRC
- pet are Tryco’s regular employees assigned
to the Production Dept
- Tryco and pet signed separate MOA
providing for a compressed workweek
schedule to be implemented in the company
-> under the MOA, 8AM-6:12PM from Mon-
Fri shall be considered as the regular
working hours and no OT pay shall be due
and payable to the employee for work
rendered during those hours -> MOA
specifically stated that the employee waives
the right to claim OT pay for work rendered
after 5PM until 6:12PM from Mon-Fri
considering that the comprssed workweek
schedule is adopted in lieu of the regular
workweek schedule which also consists of
46 hrs -> However, should an employee be
permitted or required to work beyond 6:12,
he shall be entitled to OT pay
- Tryco informed the Bureau of Working
Conditions of DOLE of the implementation
of a compressed workweek in the company
- pet and Tryco negotiated for the renewal of
their CBA but failed to arrive at a new
agreement -> Tryco then rcvd a letter from
the Bureau of Animal Industry of the DA
reminding it that its production should be
conducted in Bulacan and not Caloocan
- Tryco then issued a memo which directed
one of the pet to report to the company’s
plant site in Bulacan -> refused to obey ->
tryco reiterated the order -> through a
memo, tryco also directed other pet to report
to the company’s plant site in Bulacan
- pet opposed the transfer of its members to
Bulacan contending that it constitutes unfair
labor practice -> pet declared a strike -> pet
then filed their separate complaints for
illegal dismissal, underpayment of wages,
nonpayment of OT pay and service
incentive leave, and refusal to bargain
against tryco and its president
- pet allege that the company acted in bad
faith during the CBA negotiations bec it sent
representatives without authority to bind
the company, and this was the reason the
nego failed -> the mgmt. transferred pets
from Caloocan to Bulacan to paralyze the
union -> prayed for the company to pa them
their salaries, service incentive leaves, and
OT pay
- R averred that the pet were not dismissed
but they refused to comply with the mgmt’s
directive for them to report to the
company’s plant in Bulacan -> denied the
allegation that they negotiated in bad faith
->further averred that long before the start
of the negotiations, the company had
already been planning to decongest the
Caloocan office to comply with govt policy
to shift the concentration of manufacturing
activities from the metropolis to the
countryside -> decision to transfer the
company’s production activities was
precipitated by the letter-reminder of the
BAI
- LA: the transfer of the pet would not
paralyze or render the union ineffective bec:
(1) complainants are not members of the
negotiating panel; and (2) the transfer was
made pursuant to the directive of the
Department of Agriculture- also denied the
money claims stating that the nonpayment
of wages was justified bec the pet did not
render work for 6 days -> OT pay is not due
because of the compressed workweek
agreement and service incentive leave pay
cannot be claimed bec thay are already
enjoying vacation leave with pay for at least
5 days
- NLRC: affirmed LA decision
- CA: ruled that the transfer order was a
mgmt. prerog not amounting to a
constructive dismissal or an unfair labor
practice
- SC: refused to accept pet’s wild and
reckless imputation that the BAI conspired
with R just to effect the transfer of pet ->
there is not an iota of proof to support this
outlandish claim -> Absent any evidence,
the allegation is not only highly
irresponsible but is grossly unfair to the
government agency concerned. -> Tryco's
decision to transfer its production activities
to San Rafael, Bulacan, regardless of
whether it was made pursuant to the letter
of the Bureau of Animal Industry, was
within the scope of its inherent right to
control and manage its enterprise effectively
- While the law is solicitous of the welfare of
employees, it must also protect the right of
an employer to exercise what are clearly
management prerogatives. The free will of
management to conduct its own business
affairs to achieve its purpose cannot be
denied.
- Management's prerogative of transferring
and reassigning employees from one area of
operation to another in order to meet the
requirements of the business is, therefore,
generally not constitutive of constructive
dismissal -> he consequent transfer of
Tryco's personnel, assigned to the
Production Department was well within the
scope of its management prerogative.
- When the transfer is not unreasonable, or
inconvenient, or prejudicial to the employee,
and it does not involve a demotion in rank
or diminution of salaries, benefits, and other
privileges, the employee may not complain
that it amounts to a constructive dismissal ->
the transfer orders do not entail a demotion
in rank or diminution of salaries, benefits
and other privileges of the petitioners -> pet
anchor their objection solely on the ground
that it would cause them great
inconvenience since they are all residents of
Metro Manila and they would incur
additional expenses to travel daily from
Manila to Bulacan.
- mere incidental inconvenience is not
sufficient to warrant a claim of constructive
dismissal.
- The compressed workweek scheme was
originally conceived for establishments
wishing to save on energy costs, promote
greater work efficiency and lower the rate of
employee absenteeism, among others.
Workers favor the scheme considering that
it would mean savings on the increasing
cost of transportation fares for at least one
(1) day a week; savings on meal and snack
expenses; longer weekends, or an additional
52 off-days a year, that can be devoted to
rest, leisure, family responsibilities, studies
and other personal matters, and that it will
spare them for at least another day in a
week from certain inconveniences that are
the normal incidents of employment, such
as commuting to and from the workplace,
travel time spent, exposure to dust and
motor vehicle fumes, dressing up for work,
etc.
- the adoption of a compressed workweek
scheme in the company will help temper
any inconvenience that will be caused the
petitioners by their transfer to a farther
workplace
WORK INTERRUPTION DUE TO
BROWNOUTS
28. DURABILT RECAPPING PLANT v.
NLRC
- complaint for illegal dismissal was filed by
R Bodegas against pet
- LA: R was ordered reinstated to his former
position with full backwages, from the time
he was terminated up to the time he is
actually reinstated -> pet failed to file a
seasonable appeal and entry of final
judgment was made
- DOLE submitted a computation of
backwages, ECOLA, 13th month pay, sick
and vacation leave benefits in favor of R ->
pet filed its opposition to the computation
on the ground that it contemplated a
straight computation of 26 working days in
one month when the period covered by the
computation was intermittently interrupted
due to frequent brownouts and machine
trouble and that R had only a total of 250.75
days of attendance in 1982 due to absences
- LA: denied opposition to the computation
- NLRC: affirmed LA order
- SC: illegal dismissal of R is conceded by
pet -> pet is willing to pay backwages,
however, the pet argues that for days where
no work was required and could be done by
its employees, no wages could have been
earned and, thereafter, lost by said
employees to justify an award of backwages
- OSG: pet have valid reasons to claim that
certain days should not be considered days
worked for purposes of computing R’s
backwages since their business was not in
actual operation due to brownouts or power
interruption and the retrenchment of
workers they had during the period of R’s
dismissal
- During 1983, there was a chronic electrical
power interruption resulting to disruption
of business operations -> the govt called on
the industrial sector to the so-called
Voluntary Loan Curtailment Plan whereby
brownouts or electrical power interruption
was scheduled by area -> pet participated in
the VLCP
- Ministry of Labor and Employment,
through Policy Instruction No. 36 said that
brownouts running for more than 20 mins
may not be treated as hours worked
provided that any of the ff conditions are
present: (1) The employees can leave their
work place or go elsewhere whether within
or without the work premises; or (2) The
employees can use the time effectively for
their own interest.
- It is of record that during electrical power
interruptions, pet’s business was not in
operation -> NEVER disputed by R
- pet claim that the period during which
they effected retrenchment of workers
owing to economic crisis then prevailing
likewise appears plausible -> SC held that
where the failure of workers to work was
not due to the employer’s fault, the burden
of economic loss suffered by the employees
should not be shifted to the employer ->
each party must bear his own loss
- It would neither be fair nor just to allow R
to recover something he has not earned and
could not have earned and to further
penalize the pet over and above the losses it
had suffered d/t lack of raw materials and
the energy-saving programs of the govt -> R
cannot be allowed to enrich himself at the
expense of the pet company
MEAL BREAKS:
Conditions for validity:
29. PAN AMERICAN WORLD AIRWAYS
SYSTEM v. PAN AMERICAN
EMPLOYEES ASSOCIATION
- CIR (industrial relations) rendered
resolution en banc denying the MR filed by
pet herein -> in appeal, pet advances 5
propositions: x x x x x (2) the finding that the
1-hour meal period should be considered
OT work (deducting 15 mins as time allotted
for eating) is not supported by substantial
evidence x x x x x (5) CIR had no authority
to order the company to adopt a straight 8-
hour shift INCLUSIVE of meal period
- pet claims that the 1-hr meal period should
NOT be considered as OT work because the
evidence showed that complainants could
rest completely and were not in any manner
under the control of the company during
that period -> however, it was found by the
Court that during the so called meal period,
the mechanics were required to stand by for
emergency work; that if they happened not
to be available when called, they were
reprimanded -> the record clearly confirms
the above factual findings of the CIR
- The CIR order for permanent adoption of a
straight 8-hour shift including the meal
period was but a consequence of its finding
that the meal hour was not one of complete
rest but was actually a work hour bec for its
duration, the laborers had to be on ready
call
30. SIME DARBY PILIPINAS v. NLRC
- prior to the present controversy, ALL
company factory workers in Marikina
including the members of PR union worked
from 7:45AM-3:45PM with a 30-min paid
“on call” lunch break
- pet issued a memo to all factory-based
employees advising all its monthly salaried
employees in its Marikina Tire Plant, except
those in the Warehouse and Quality
Assurance Dept working on shifts, a change
in the work schedule discarding their paid
lunch break
- PR felt adversely affected by the change in
the work schedule and discontinuance of the
30-minute paid “on call” lunch break, it filed
a complaint with the LA for unfair labor
practice, discrimination, and evasion of
liability
- LA: dismissed the complaint on the ground
that the change in the work schedule and
the elimination of the 30-min paid lunch
break constituted a valid exercise of mgmt.
preog -> the new work sched, break time
and 1-hour lunch break did not have the
effect of diminishing the benefits granted to
factory workers as the working time did not
exceed 8 hours -> further held that the
factory workers would be unjustly enriched
if they continued to be paid during their
lunch break even if they were no longer “on
call” or required to work during the break
- NLRC: sustained LA -> MR: NLRC
reversed its earlier decision as well as the
decision of the LA
- SC: the memorandum which contained the
new work sched was NOT discriminatory of
the union members nor did it constitute
unfair labor practice on the part of pet -> the
right to fix the work sched of the employees
rests principally on their employer -> pet
cites as reason for the adjustment the
efficient conduct of its business operations
and its improved production -> while the
old work sched included a 30-min paid
lunch break, the employees could be called
upon to do jobs during that period as they
were “on call” -> with the new work sched,
the employees are now given a 1-hour lunch
break, the employees can freely and
effectively use this hour not only for eating
but also for their rest and comfort which are
conducive to more efficiency and better
performance in their work
- Since the employees are no longer required
to work during this 1-hour lunch break,
there is no more need for them to be
compensated for this period -> the new
work sched fully complies with the daily
work period of 8 hours without violating the
LC -> also, the new sched applies to ALL
employees in the factory similarly situated
whether they are union members or not
31. PHILIPPINE AIRLINES v. NLRC
- PR was employed as a flight surgeon at pet
-> was on duty from 4PM-12MN
- around 7PM, PR left the clinic to have his
dinner at his residence which was about a
50min drive away -> a few minutes later, the
clinic rcvd an emergency call from the PAL
Cargo Svcs -> one of its employees had
suffered a heart attack -> nurse on duty
called PR at home to inform him of the
emergency -> patient arrived at the clinic at
7:50PM and nurse immediately rushed him
to the hospital -> when PR reached the clinic
at 7:51PM, nurse had already left with the
patient -> patient died the following day
- PAL Medical Director ordered for an
investigation to be conducted -> PR was
required to explain why no disciplinary
sanction should be taken against him -> PR
asserted that he was entitled to a 30-min
meal break; that he immediately left his
residence upon being informed about the
emergency and he arrived at the clinic a few
minutes later -> the nurse panicked and
brought the patient to the hospital without
waiting for him
- mgmt. charges PR with abandonment of
post while on duty -> PR denied that he
abandoned his post and said that he only
left the clinic to have his dinner at home ->
pet decided to suspend PR for 3 months ->
PR filed a complaint for illegal suspension
with LA
- LA: declared the suspension of PR was
illegal
- NLRC: affirmed LA decision
- SC: the facts do not support pet’s allegation
that PR abandones his post -> PR left the
clinic only to have dinner at his house which
was only a few mins drive away -> his
whereabouts were knows to the nurse on
duty so that he could easily be reached in
case of emergency -> PR immediately left his
home and returned to the clinic upon
learning of the emergency -> these facts belie
pet’s claim of abandonment
- pet argues that being a full-time employee,
PR is obliged to stay in the company
premises for not less than 8 hours -> he may
not leave the premises during such times,
even to take his meals
- SC: the 8-hr work period does not include
the meal break -> nowhere in the law may it
be inferred that employees must take their
meals within the company premises ->
employees are not prohibited from going
out of the premises as long as they return to
their posts on time -> PR’s act of going home
DOES NOT constitute abandonment
IDLE TIME
- if the employee was “waiting to be
engaged” – he was on his OWN volition
waiting for the time of his next
job/engagement during which his time is
NOT controlled by the employer. Such
waiting time is NOT considered working
time
WAITING TIME
- if the employee was “engaged to wait” –
made to wait BY the employer = such
waiting time is working time
32. ARICA v. NLRC
- case stemmed from a complaint filed by
pet against PR company for assembly time,
moral damages, and atty’s fees
- LA: complaint dismissed -> the 30-min
assembly time long practiced cannot be
CONSIDERED waiting time or work time
and, therefore, not compensable
- NLRC: upheld LA decision
- ISSUE: WON the 30-minute activity of the
pet before the scheduled working time is
compensable under the LC
- pet contend that the 30-min preliminary
activities in the assembly area is
compensable as working time since these are
necessarily and primarily for the PR’s
benefit
- R avers that the instant complaint is not
new, the very same claim having been
brought against it by the same group of rank
and file employees in a previous case which
was filed way back in 1976 -> involved a
claim for waiting time as the complainants
purportedly were required to assemble at a
designated area at least 30 mins prior to the
start of their scheduled working hours “to
ascertain the work force available for the
day by means of a roll call, for the purpose
of assignment or reassignment of employees
to such areas in the plantation where they
are most needed”
- The facts on which this decision was
predicated continue to be the facts of the
case in this questioned NLRC resol -> it is
clear that that herein pet are merely
reiterating the very same claim which they
filed through the ALU and which records
show had already been long been
considered terminated and closed by the SC
-> Therefore, NLRC cannot be faulted for
ruling that pet’s claim is already barred by
res judicata
- It is axiomatic that the non-compensability
of the claim having been earlier established,
constitute the CONTROLLING legal rule or
decision between the parties and remains to
be the law of the case making this petition
without merit
- SC: account should be taken of the cognate
principle that res judicata operates to bar not
only the relitigation in a subsequent action
of the issue squarely raised, passed upon
and adjudicated in the first suit, but also the
ventilation in said subsequent suit of any
other issue which could have been raised in
the first but was not -> Even if new causes of
action are asserted in the 2 nd action, this
would not preclude the operation of the
doctrine of res judicata -> those issues are
also barred, even if not passed upon in the
first
COMMUTING TIME AND TRAVEL
TIME
- ANY work which an employee is
REQUIRED to perform WHILE
TRAVELLING is considered in hours
worked
- to determine if commuting/travel time is
working time = look at the KIND of travel
involved. There are 3 kinds:
1) Travel from home to work; (2) Travel that is
all in the day’s work; and (3) Travel away from
home.
Travel from home to work (and vice-versa)
- Generally, this is not working time. Ordinary
home-to-work travel is a normal incident of
employment, whether the employee works at a
fixed location or at different jobsites.
- Exception: when an employee receives an
emergency call outside his regular working
hours and is then required to travel to the
workplaces, all that time spent traveling is
considered working time.
Travel that is all in the day’s work
- If travel is part of the employee’s principal
activity, it is counted as hours worked, such
as when the employee is required to report
to a meeting place to receive instructions, or
perform some work there, or to pick and to
carry tools.
- If an employee normally finishes his work
at 5 pm and is sent to another job which he
finished at 8 pm and is required to return to
his employer’s premises at 9 pm, the period
between 5-9 pm is considered working time.
But if he went straight home after 8 pm and
didn’t go back to the employer’s premises,
the period between 8-9 pm is considered
home-to-work and is not considered hours
worked.
Travel away from home
- This is travel that keeps an employee away
from home overnight.
- It is considered working time when it cuts
across the employer’s workday.
- In this scenario, during regular hours on
both working and non-working days, the
employee is considered to be working, i.e.
when he regularly works from 9-5 pm
Monday-Friday, his time travel away from
home from 9-5 pm on Saturdays is
considered hours worked as well.
- regular meal period is not counted, and
times spent on travel away from home
outside regular working hours is also not
considered as working time.
OVERTIME WORK
Definition and nature of OT work
33. SALAZAR v. NLRC
- PR employed pet as construction/project
engineer -> by virtue of an ORAL contract,
pet would also receive a share in the profits
after completion of the project and that pet’s
svcs in excess of 8 hrs on regular days and
svcs rendered on weekends and legal
holidays shall be compensable OT at the rate
of Php27.85/hr
- pet rcvd a memo issued by PR project mgr
informing him of the termination of his svcs
because the project has already been
competed
- pet filed a complaint against PR for illegal
dismissal, unfair labor practice, illegal
deduction, non-payment of wages, OT
rendered, svc incentive leave pay,
commission, allowances, profit-sharing and
separation pay with the NLRC
- LA: pet was a managerial employee and
therefore exempt from payment of benefits
such as OT pay, etc -> he was hired as a
project employee and his svcs were
terminated d/t the completion of the project
- NLRC: LA decision affirmed in toto
- ISSUE: WON pet is entitled to OT pay,
premium pay for svcs rendered on rest days
and holidays and service incentive leave
pay, pursuant to Art 87, 93, 94. And 95 LC
- pet claims that since he perfoms his duties
in the project site or away from the principal
place of business of his employer, he falls
under the category of “field personnel”
- although pet cannot strictly be classified as
a managerial employee under Art 82,
nonetheless, he is still NOT entitled to
payment of the benefits because he falls
squarely under another exempt category:
“officers or members of a managerial staff”
-> pet has supervisory duties as PR’s project
engineer, duties which, pet does not dispute
- pet also claims that NLRC failed to give
due weight and consideration to the fact that
PR compensated him for his OT svcs as
indicated in the various disbursement
vouchers he submitted as evidence -> that
pet was paid OT benefits does not
automatically and necessarily denote that
pet is entitled to such benefits -> Art 82 LC
specifically delineates who are entitled to
the OT premiums and svc incentive leave
pay provided under Art 87, 93, 94, and 95
and the exemptions
- pet falls under the exemptions and has no
legal claim to the said benefits -> it is well
and good that pet was compensated for his
OT svcs -> however, this does not translate
into a right on the part of pet to demand
additional payment when, under the law,
pet is clearly exempted
34. SAN MIGUEL BREWERY v.
DEMOCRATIC LABOR UNION
- R filed complaint against pet embodying
12 demands for the betterment of the
conditions of employment of its members
- R manifested to confine its claim to its
demands for OT, night-shift diff pay, and
atty’s fees, although it was allowed to
present evidence on svc rendered during
Sundays and holidays, or on its claim for
additional separation pay and sick and
vacation leave compensation
- With regard to OT compensation, Judge of
industrial court held that the provisions of
the 8-hour labor law apply to the employees
concerned for those working in the field or
engaged in the sale of the company’s
products outside the premises and
consequently they should be paid the extra
compensation accorded them by said law in
addition to the monthly salary and
commission earned by them, regardless of
the meal allowance given to employees who
work up to late at night
- With regard to work done during Sundays
and holidays, Judge also decreed that the
employees be paid an additional
compensation of 25% as provided in CA No
444 even if they had been paid a
compensation on monthly salary basis
- pet filed present petition for review with
SC
- pet contend that since the employees
concerned are paid a commission on the
sales they make outside of the required 8
hours besides the fixed salary that is paid to
them, they should not be paid OT
compensation under the 8-hour labor law
bec the commission they are paid already
takes the place of such OT compensation ->
OT compensation is an additional pay for
work or svcs rendered in excess of 8 hours a
day by an employee -> if the employee is
already given extra compensation for labor
performes in excess of 8 hours a day, he is
not covered by the law -> the situation can
be likened to an employee who is paid on
piece-work or “pakiao”, or commission
basis, which is expressly excluded from the
operation of the 8-hour labor law
- SC: in accord with pet’s view -> the 8-hour
labor law only has application where an
employee or laborer is paid on a monthly or
daily basis, in which case, if he is made to
work beyond the required period of 8hrs, he
should be paid the additional compensation
prescribed by law -> 8-hr labor law has NO
application when the employee is paid on a
piece-work, “pakiao”, or commission basis
regardless of the time employed -> his
earnings are in the form of commission
based on the gross receipts of the day ->
participation depends on his industry so
that the more hours he employs in the work,
the greater are his gross returns and the
higher his commission
- the employees concerned are paid a fixed
salary for their month of service and
sometimes they work in excess of the
required 8-hrs -> but for their extra work,
they are paid a commission which is IN
LIEU of the extra compensation to which
they are entitled
=> the 8-hour labor law DOES NOT apply to
the employees composing the outside
service force
35. PAL EMPLOYEES SAVINGS AND
LOAN ASSOC v. NLRC
- PR filed with NLRC a complaint for non-
payment of OT pay and non-payment of the
Php25 statutory minimum wage increase
mandated by RA 6727
- PR started working with pet as a company
guard and was required to work 12 hours a
day -> was given several salary increases for
his outstanding performance -> during this
entire period of employment with pet, he
was required to perform OT wok without
any additional compensation and it was also
at this point where pet refused to give the
Php25 increase on the minimum wage rates
provided for by law -> PR was suspended
for 37 days for an offense allegedly
committed by the pet
- LA: granted claim for PT pay
- NLRC: LA decision affirmed
- ISSUE: Is an employee entitled to OT pay
for work rendered in excess of the regular 8-
hour day given the fact that he entered into
a contract of labor SPECIFYING a work-day
of 12 hours at a fixed monthly rate above the
legislated minimum wage?
- SC: upheld NLRC ruling that PR is entitled
to OT pay -> based on pet’s own
computation, it appears that the basic salary
plus emergency allowance given to PR did
not actually include the OT pay claimed by
PR -> basic salaray plus emergency
allowance SHOULD HAVE amounted to
Php2,800.50, but pet only actually paid PR a
total of Php2,500 -> pet’s own calculations
clearly establish that PR’s claim for OT pay
is valid
- NLRC found no agreement as to OT pay
under the employment contract -> the
contract was definite only as to the number
of hours of work to be rendered but vague
as to what is covered by the salary
stipulated
- pet contends that the agreed salary rate in
the employment contract should be deemed
to cover OT pay, otherwise serious
distortions in wages would result since a
mere company guard will be receiving a
salary much more than the salaries of other
employees who are much higher in rank and
position than him in the company -> SC
finds this argument undeserving of
consideration -> how can paying an
employee the OT pay due him cause serious
distortions in salary rates or scales? And
how can “other employees” be aggrieved
when they did not render any OT service?