DANICA LOU S.

FLORES

REGGIE ORBISTA ZONIO, Petitioner,

vs.
1ST QUANTUM LEAP SECURITY AGENCY, INC. AND ROMULO Q. PAR,
Respondents.
G.R. NO. 224944, MAY 5, 2021
J. LOPEZ, M.,

FACTS:
This case is about the denial of the claims of the petitioner, Zonio for payment of
overtime and holiday pay; holiday and rest day premiums pay, and night shift
differentials pay.

According to the facts of the case, petitioner was a hard-worker employee who worked
seven days a week from 7:00am to 7:00pm and vice versa. Allegedly, the respondent
did not pay him for overtime work, work rendered on holidays and rest days, as well as
13th month pay, service incentive leave, and night shift differential.

Sometime on April 2014, the petitioner along with his colleagues received a
memorandum suspending them for at least one month for sleeping while on duty. There
was no formal investigation, the petitioner served the suspension and returned to the
company after one month, however, the respondent refused to accept him.

In result, Zonio filed a complaint against respondents for illegal suspension

underpayment of salary and 13th month pay; non-payment of overtime and holiday;
holiday and rest day premiums pay; service incentive leave pay; night shift differential
pay; reimbursement of cash bond and miscellaneous fees; moral and exemplary
damages; and attorney’s fees.

ISSUE:
Whether Zonio is entitled to receive payment for overtime and holiday; holiday and rest
day premiums pay, and night shift differentials pay?

LAW APPLICABLE:

Labor Code:
“ART. 86. Night-Shift Differential. – Every employee shall be paid a night shift
differential of not less than ten percent (10%) of his regular wage for each
hour of work performed between ten o’clock in the evening and six o’clock in
the morning.”

Related Jurisprudence: In the case of Minsola vs. New City Builders, Inc.

“In determining the employee's entitlement to monetary claims, the burden

of proof is shifted from the employer or the employee, depending on the
monetary claim sought.”
DANICA LOU S. FLORES

CHRONOLOGY OF THE CASE:

Sometime in 2014, Zonio filed a complaint against respondents before the Labor Arbiter.
In its decision dated February 26, 2015, Labor Arbiter Joel A. Allones ruled that Zonio
was validly suspended for sleeping in his post as proved by photographs. Moreover,
Zonio failed to substantiate his claims for his claim for payment for overtime and
holiday; holiday and rest day premiums pay, and night shift differentials pay.

Zonio appealed to NLRC on the ground that the Labor Arbiter erred in ruling that he is
not entitled to the payment of overtime and holiday pay; holiday and rest day premiums
pay; night shift differentials pay.

In a Decision dated May 29, 2015, the NLRC modified the Decision of the LA and ruled
that Zonio is entitled to overtime and holiday pay; holiday and rest day premiums pay;
and night shift differentials pay.

Respondents filed a petition for certitiorari with the CA to question the award of overtime
and holiday pay, holiday and rest day premiums, and night shift differentials pay in favor
of Zonio.

RULING OF THE SUPREME COURT:

The supreme court said that, Zonio proved his entitlement to monetary claims.

Here, to prove his entitlement to the payment of overtime pay; holiday and rest day
premiums pay; and night shift differentials pay, Zonio submitted a photocopy of the
logbook entries which showed the dates and shift when he reported for work, as well as
the specific tasks he performed on that particular work shift. The logbook also contains
the same information with regard to other security guards. Before and after each
particular work shift, the incoming and outgoing security guard will sign the
corresponding entry in the logbook. However, the logbook does not contain whether
Zonio worked on holidays or during his rest days. Thus, Zonio's claim for holiday and
rest day premiums is denied for lack of factual basis. Meanwhile, the entries in the
logbook showed that Zonio worked 12-hour shifts, which ran from 7:00 a.m./p.m. to 7:00
p.m./a.m. Thus, he is entitled to overtime pay for work performed beyond eight hours a
day,[24] or four hours for every shift. Likewise, Zonio is entitled to night-shift differential
for each hour of work performed between 10:00 p.m. to 6:00 a.m.

OPINION OF THE STUDENTS:

I agree with the basis of the decision of the court in this case, the logbooks serve as
strong evidence to prove that the petitioner worked overtime, thus he is entitled to
overtime pay for work performed beyond eight hours a day. Likewise, he is entitled to
night-shift differential for each hour of worked performed between 10:00pm to 6:00am.

It is true that the logbook is self-serving because it is deemed a personal record of

Zonio and other security guards. However, the entries in the logbooks could be
construed as Prima Facie evidence. Prima facie evidence is such evidence as, in the
DANICA LOU S. FLORES

judgment of the law, is sufficient to establish a given fact, or the group, or chain of facts
constituting the party's claim or defense, and which if not rebutted or contradicted, will
remain sufficient.

MARBY FOOD VENTURES CORPORATION, MARIO VALDERRAMA, AND EMELITA

VALDERRAMA, Petitioners,
vs.
ROLAND DELA CRUZ, GABRIEL DELA CRUZ, JOSE PAULO ANZURES, EFREN
TADEO, BONGBONG SANTOS, MARLON DE RAFAEL, CRIS C. SANTIAGO,
ELMER MARANO, ARMANDO RIVERA, AND LOUIE BALMES, Respondents.
G.R. NO. 244629 JULY 28, 2020
J. REYES, J. JR.:

FACTS:

In this case, the petitioner Marby Food Ventures Corporation (Marby) is a domestic
corporation duly organized and existing under Philippine laws engaged in the business
of production and distribution of baked goods. Mario Valderrama is the President/CEO
of Marby while Ma. Emelita Valderrama is the Vice-President.

The respondents were all employed by Marby as drivers. Mark Francis Bernardino
(Bernardino) meanwhile was hired as salesman. They all filed a complaint for
underpayment of wage, overtime pay and 13th month pay, non-payment of holiday pay,
service incentive leave pays, sick and vacation leave pay under the Collective
Bargaining Agreement (CBA), illegal deductions, moral and exemplary damages and
attorney's fees against petitioners. They also questioned the unauthorized salary
deductions made by Marby labeled as "everything" in their pay slips.

Petitioners assailed that respondents have been receiving the required minimum wage
and 13th month pay. The alleged unauthorized deductions are penalties imposed on
them for deliveries made outside the imposed delivery hours, bad orders, shortages in
liquidation and cell phone plans. They claimed that respondents were duly informed of
the nature of the deductions and have consented to the same. Nevertheless, Marby
ceased imposing said deductions since September 2016. As to the claim for overtime
pay, holiday pay and service incentive leave pay, petitioners maintained that
respondents are not entitled to the same for being field personnel.

The Labor Arbiter ruled that respondents are not entitled to their claims for overtime pay,
holiday pay, service incentive leave pay, vacation leave and sick leave pay and illegal
deductions.

The NLRC partially reversed the ruling of the Labor Arbiter, finding Tadeo, Pagtalunan
and Bernardino to have been receiving the required minimum wage as well as the
proper 13th month pay.
DANICA LOU S. FLORES

ISSUE:
Whether the respondents are entitled to overtime pay, holiday pay and service incentive
leave pay.

LAWS APPLICABLE:
Article 113 of the Labor Code that no employer, in his own behalf or in behalf of any
person, shall make any deduction from the wages of his employees, except in cases
where the employer is authorized by law or regulations issued by the Secretary of Labor
and Employment, among others.

The Omnibus Rules Implementing the Labor Code, similarly, provides that deductions
from the wages of the employees may be made by the employer when such deductions
are authorized by law, or when the deductions are with the written authorization of the
employees for payment to a third person.

Article 116 of the Labor Code clearly provides that it is unlawful for any person, directly
or indirectly, to withhold any amount from the wages of a worker without the worker's
consent.

Pursuant to Section 12 of R.A. No. 6727, as amended by R.A. No. 8188, petitioners are
required to pay double the amount owed to respondents.

Section 12. Any person, corporation, trust, firm, partnership, association or entity which
refuses or fails to pay any of the prescribed increases or adjustments in the wage rates
made in accordance with this Act shall be punished by a fine not less than Twenty-five
thousand pesos (P25,000.00) nor more than One hundred thousand pesos
(P100,000.00) or imprisonment of not less than two (2) years nor more than four (4)
years, or both such fine and imprisonment at the discretion of the court: Provided, That
any person convicted under this Act shall not be entitled to the benefits provided for
under the Probation Law.

CHRONOLOGY OF THE CASE:

Before the Court is a Petition for Review on Certiorari1 under Rule 45 of the Rules of
Court, seeking the review of the Decision2 dated October 19, 2018 and
Resolution3 dated January 21, 2019 of the Court of Appeals (CA) in CA-G.R. SP No.
151531 & 151557 wherein the CA affirmed the Decision4 of the National Labor
Relations Commission (NLRC) which in turn partially reversed the ruling of the Labor
Arbiter (LA).

RULING OF THE SUPREME COURT:

YES

a. Respondents are entitled to minimum wage salary differentials, overtime pay,

holiday pay, and service incentive leave.
DANICA LOU S. FLORES

Petitioners posit that the amount labeled as "overtime pay" should be included in the
computation of minimum wage because in reality it is premium pay given by the
company whether they rendered extended hours of overtime or not.

The nomenclature "overtime pay" in the payslips of respondents provides a presumption

that indeed overtime was rendered by them. There was no tenable explanation offered
as to this ongoing practice. Petitioners did not even present the daily time records of the
respondents to prove that they were given premium pay for work not rendered. Also, if
the same was in reality "premium pay," this should have been the term that was used in
the payslips. As the argument proffered by petitioners on this score run counter to what
an ordinary man would consider reasonable, we are inclined to believe that this
explanation is merely being advanced to escape liability.

As for holiday pay and service incentive leave pay, it is settled that as a rule, a party
who alleges payment as a defense has the burden of proving it.24

Specifically, with respect to labor cases, the burden of proving payment of monetary
claims rests on the employer. The rationale for this 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, except for the bare allegation of petitioners, no proof was
presented to prove payment of the contested benefits. Considering that there was
in fact no "premium pay" that was given by petitioners to respondents, the latter
are entitled to minimum wage pay differentials.

As for Tadeo, he is entitled to salary differentials, except for 2016. The CA ruled that
there was no basis to the claim that he has been receiving minimum wage because as
the NLRC held, the daily rate presented by the respondents were not disputed by
petitioners, hence, they are deemed admitted. For failure of respondents-employers to
refute the allegation on Tadeo's daily wage rate, the same is deemed admitted.
Comparing the said rate to the minimum wage rate, there is no dispute that Efren Tadeo
had received salary below the minimum wage rate except for the year 2016. As such,
he is entitled to salary differentials.

b. Respondents are entitled to 13th month pay differentials

Because respondents received salaries below the minimum wage, the basis in
computing their 13th month pay was inaccurate. Hence, they should be awarded 13n
month pay differentials.

c. Respondents are entitled to reimbursements of deductions

DANICA LOU S. FLORES

It is clearly stated in Article 11326 of the Labor Code that no employer, in his own behalf
or in behalf of any person, shall make any deduction from the wages of his employees,
except in cases where the employer is authorized by law or regulations issued by the
Secretary of Labor and Employment, among others. The Omnibus Rules Implementing
the Labor Code, similarly, provides that deductions from the wages of the employees
may be made by the employer when such deductions are authorized by law, or when
the deductions are with the written authorization of the employees for payment to a third
person. 27 Therefore, any withholding of an employee's wages by an employer may
only be allowed in the form of wage deductions under the circumstances provided in
Article 113 of the Labor Code, as well as the Omnibus Rules implementing it. Further,
Article 11628 of the Labor Code clearly provides that it is unlawful for any person,
directly or indirectly, to withhold any amount from the wages of a worker without the
worker's consent.

In the instant case, petitioners confirmed the alleged deductions but reasoned that the
same were due to the penalties they imposed for deliveries outside the delivery hours,
cell phone plans, bad orders and liquidation shortage. This act is a clear violation of the
labor code since there was no written conformity coming from the respondents
regarding the deduction. Hence, reimbursement of these illegal deductions should be
returned to the respondents.

d. Petitioners are not liable for double the unpaid benefits owing to the
employees

Pursuant to Section 12 of R.A. No. 6727, as amended by R.A. No. 8188, petitioners are
required to pay double the amount owed to respondents.

In the instant case, the petitioners argue that the rule on double indemnity applies
only if there is refusal or failure to pay the adjustment in wage rate. They deny
that they unjustly refused any payment that respondents are legally entitled to.

Here, there was no order from any competent authority advising the petitioners to
pay unpaid employee benefits with sanctions for double indemnity in case of
refusal or failure to correct the violation. Hence, it cannot be said that it refused
or failed to pay any of the prescribed increases or adjustments in the wage rates
to come within the purview of Section 12 of R.A. No. 6727, as amended by RA No.
8188. As such, there is no basis to hold the petitioners for double indemnity.

OPINION OF THE STUDENTS:

I agree with the decision of the Supreme Court that the respondents are entitled to
overtime pay, holiday pay and service incentive leave pay.
DANICA LOU S. FLORES

GERARDO F. RIVERA, ALFRED A. RAMISO, AMBROCIO PALAD, DENNIS R.

ARANAS, DAVID SORIMA, JR., JORGE P. DELA ROSA, and ISAGANI
ALDEA, Petitioners,
vs.
HON. EDGARDO ESPIRITU in his capacity as Chairman of the PAL Inter-Agency
Task Force created under Administrative Order No. 16; HON. BIENVENIDO
LAGUESMA in his capacity as Secretary of Labor and Employment; PHILIPPINE
AIRLINES (PAL), LUCIO TAN, HENRY SO UY, ANTONIO V. OCAMPO, MANOLO E.
AQUINO, JAIME J. BAUTISTA, and ALEXANDER O. BARRIENTOS, Respondents.
G.R. No. 135547 January 23, 2002
J. QUISUMBING;

FACTS:
PAL was suffering from a difficult financial situation in 1998. It was faced with
bankruptcy and was forced to adopt a rehabilitation plan and downsized its labor force
by more than 1/3. PALEA (PAL Employees Association) went on a four-day strike to
protest retrenchment measures in July 1998. PAL ceased operations on Sep 23, 1998.

PALEA board again wrote the President on Sep 28, 1998. Among others, it proposed
the suspension of the PAL-PALEA CBA for a period of ten years, subject to certain
conditions. PALEA members accepted such terms through a referendum on Oct 2,
1998. PAL resumed domestic operations on Oct 7, 1998.

Seven officers and members of PALEA filed instant petition to annul the Sep 27, 1998
agreement entered into between PAL and PALEA.

ISSUE:
Whether PAL-PALEA agreement of 27 SEPT 1998, stipulating the suspension of the
PAL-PALEA CBA, UNCONSTI and contrary to public policy?

LAWS APPLICABLE:
ART. 253-A. Terms of a Collective Bargaining Agreement. – Any Collective Bargaining
Agreement that the parties may enter into shall, insofar as the representation aspect is
concerned, be for a term of five (5) years. No petition questioning the majority status of
the incumbent bargaining agent shall be entertained and no certification election shall
be conducted by the Department of Labor and Employment outside of the sixty-day
period immediately before the date of expiry of such five-year term of the Collective
Bargaining Agreement. All other provisions of the Collective Bargaining Agreement shall
DANICA LOU S. FLORES

be renegotiated not later than three (3) years after its execution. Any agreement on
such other provisions of the Collective Bargaining Agreement entered into within six (6)
months from the date of expiry of the term of such other provisions as fixed in such
Collective Bargaining Agreement, shall retroact to the day immediately following such
date. If any such agreement is entered into beyond six months, the parties shall agree
on the duration of the retroactivity thereof. In case of a deadlock in the renegotiation of
the collective bargaining agreement, the parties may exercise their rights under this
Code.

CHRONOLOGY OF THE CASE:

In this special civil action for certiorari and prohibition, petitioners charge public
respondents with grave abuse of discretion amounting to lack or excess of jurisdiction
for acts taken in regard to the enforcement of the agreement dated September 27,
1998, between Philippine Airlines (PAL) and its union, the PAL Employees Association
(PALEA).

RULING OF THE SUPREME COURT:

NO.
Petitioners:
 PAL-PALEA agreement is void because it abrogated the right of workers to self-
organization and their right to collective bargaining.
o agreement was not meant merely to suspend the existing PAL-PALEA CBA,
which expires on 30 SEPT 2000, but also to foreclose any renegotiation or any
possibility to forge a new CBA for a decade or up to 2008
 Invokes Art. 253-A of the Labor Code (now 265) & Constitutional protection of labor
o Stating that, by agreeing to a 10-year suspension, PALEA, in effect, abdicated
the workers’ constitutional right to bargain for another CBA at the mandated time,
which is 5 years

Supreme Court: Disagrees.

RULE
 CBA is “a contract executed upon request of either the employer or the exclusive
bargaining representative incorporating the agreement reached after negotiations
with respect to wages, hours of work and all other terms and conditions of
employment, including proposals for adjusting any grievances or questions arising
under such agreement.
 primary purpose of CBA: stabilization of labor-management relations, to create
sound & stable industrial peace
o Thus, in construing a CBA, the courts must be:
practical and realistic, and
give due consideration to the context in which it is negotiated, and
DANICA LOU S. FLORES

the purpose which it is intended to serve.

AS APPLIED IN THE CASE

agreement was the result of voluntary collective bargaining negotiations undertaken in
the light of the severe financial situation faced by the employer, with the peculiar and
unique intention of not merely promoting industrial peace at PAL, but preventing the
PAL’s closure.

RULE
Art. 253-A’s two-fold purpose
 Promote industrial stability and predictability.
 To assign specific timetables wherein negotiations become a matter of right and
requirement.
o BUT nothing in Article 253-A, prohibits the parties from waiving or
suspending the mandatory timetables and agreeing on the remedies to
enforce the same.
o 5-year representation limit applies only when there is an existing CBA.

AS APPLIED IN THE CASE

 Agreement satisfies the first purpose of Article 253-A (Court doesn’t elaborate on
this).
 It was PALEA that voluntarily entered into the CBA with PAL. It was also PALEA
that voluntarily opted for the 10- year suspension of the CBA. Either case was
the union’s exercise of its right to collective bargaining
o Court: (Right to collective bargaining includes the right to suspend it)
 The 10 year suspension also DOES NOT constitute an ULP by making PALEA a
company union due to the agreement, which states that:
a. PAL shall continue recognizing PALEA as the duly certified-bargaining agent of
the regular rank-and-file ground employees of the Company
o This provision must be construed together with the next provision which states:
b. The ‘union shop/maintenance of membership’ provision under the PAL- PALEA
CBA shall be respected.
o Construed together, it shows the intent of the parties to maintain “union security”
during the period of the suspension of the CBA.
o It also does not make PALEA a company union, because a company union
exists when the employer acts “[t]o initiate, dominate, assist or otherwise
interfere with the formation or administration of any labor organization, including
the giving of financial or other support to it or organizers or supporters.” (Art 248
(d), now Art 259 of the Labor Code), and this is not evident in the records of the
case.
DANICA LOU S. FLORES

 It also does not violate the 5-year representation limit mandated by law, as this limit
applies only when there is an existing CBA in full force and effect.
In this case, the parties agreed to suspend the CBA and put in abeyance the limit on
the representation period.

OPINION OF THE STUDENTS:

I agree with the decision of the Supreme Court, PAL-PALEA agreement of 27 SEPT
1998, stipulating the suspension of the PAL-PALEA CBA, constitutional and not contrary
to public policy.

CEBU OXYGEN & ACETYLENE CO., INC. (COACO), petitioner,

vs.
SECRETARY FRANKLIN M. DRILON OF THE DEPARTMENT OF LABOR AND
EMPLOYMENT, ASSISTANT REGIONAL DIRECTOR CANDIDO CUMBA OF THE
DEPARTMENT OF LABOR AND EMPLOYMENT, REGIONAL OFFICE NO. 7 AND
CEBU OXYGEN-ACETYLENE & CENTRAL VISAYAS EMPLOYEES ASSOCIATION
(COACVEA) respondents.
G.R. No. 82849 August 2, 1989
J. GANCAYCO:

FACTS:
Petitioner Cebu Oxygen & Acetylene Co., Inc. (COACO) entered into a collective
bargaining agreement (CBA) with the union of its rank-and-file employees, Cebu
Oxygen, Acetylene and Central Visayas Employees Association (COAVEA), covering
the years 1986-1988, which grants salary increases to all regular covered employees
during the 3-year effectivity of the agreement.

• Salaries for 1st year (to be paid on Jan. 14, 1986) —P200 to
each covered employee.
• Salaries for 2nd year (to be paid on Jan. 16, 1987) — P200 to
each covered employee.
• Salaries for 3rd year (to be paid on Jan. 16, 1988) — P300 to
each covered employee.
• But if any mandated government wage adjustment or allowance
increase is issued by way of legislation, decree or presidential
edict from the specified date of payment to the next increase, the
provided salaryincreases shall be credited as payment.
Furthermore, if the wage adjustment in any particular year will
be any higher than the salary increases provided in that
particular year, then the company shall pay the difference.

On Dec. 14, 1987, Republic Act No. 6640 was passed, increasing the minimum wage
DANICA LOU S. FLORES

by 10 pesos per day for private sector employees and 11 pesos per day for non-
agricultural workers outside Metro Manila (Sec. 2, RA No. 6640).

The Secretary of Labor issued an Implementing Order which prohibits the employer
from crediting CBA anniversary wage increases for purposes of compliance with
Section 8 of RA No. 6640.

Accordingly, petitioner credited the first-year increase of P200.00 under the CBA and
added the difference of P62.00 and P31.00 to the monthly salary and the 13th month
pay, respectively, of its employees from the effectivity of RA No. 6640 on Dec. 14 1987
to Feb. 15, 1988 (a period of 2 months).

From Feb. 22 - Mar. 10, 1988, a Labor and Employment Development Officer
conducted a routine inspection of petitioner’s establishment and alleged that petitioner
committed violations of the law, constituting underpayment of both basic wage (for the
mentioned period of 2 months) and 13th month pay (for the year 1987), representing
208 employees in the aggregate amount of P131,248.00. Soon after, on April 7, 1988,
respondent Assistant Regional Director issued an Order instructing petitioner to said
amount to its 208 employees.
Petitioner protested the Order, bringing the case immediately to this Court with the
argument that Section 8 of the rules implementing the provisions of RA No. 6640,
particularly the its provision excluding anniversary wage increases from being
credited to the wage increase, is null and void on the ground that it unduly
expands the provisions of the said law.
ISSUE:
1. Whether or not an Implementing Order of the Secretary of Labor and
Employment (DOLE) can provide for a prohibition not contemplated by the law it
seeks to implement.
2. Whether or not petitioner should have first appealed to the Secretary of
Labor before going directly to the Court.

LAWS APPLICABLE:
 Section 2, Republic Act No. 6640:
“Sec. 2. The statutory minimum wage rates of workers and employees in the private sector,
whether agricultural or non- agricultural shall be increased by ten pesos (P10.00) per day, except
non-agricultural workers and employees outside Metro Manila who shall receive an increase of
eleven pesos (P11.00) per day: Provided, that those already receiving above the minimum wage
up to one hundred pesos (P100.00) shall receive an increase of ten pesos (P10.00) per day.
Excepted from the provisions of this Act are domestic helpers and persons employed in the
personal service of another.”

• Section 8, Implementing Order of Secretary of Labor and Employment:

“Sec. 8. Wage Increase Under Individual/Collective Agreements. — No wage increase
shall be credited as compliance with the increase prescribes herein unless expressly provided
under valid individual written/collective agreements; and provided further, that such wage
DANICA LOU S. FLORES

increase was granted in anticipation of the legislative wage increase under the act. Such
increases shall not include anniversary wage increase provided on collective agreements.”

CHRONOLOGY OF THE CASE:

On February 22, 1988, a Labor and Employment Development Officer, pursuant to
Inspection Authority No. 058-88, commenced a routine inspection of petitioner's
establishment. Upon completion of the inspection on March 10, 1988, and based on
payrolls and other records. On April 7, 1988, respondent Assistant Regional Director,
issued an Order instructing petitioner to pay its 208 employees the aggregate amount of
P 131,248.00.

In sum, the Assistant Regional Director ordered petitioner to pay the deficiency of
P200.00 in the monthly salary and P 231.00 in the 13th month pay of its employees for
the period stated. Petitioner protested the Order of the Regional Director on the ground
that the anniversary wage increases under the CBA can be credited against the wage
increase mandated by Republic Act No. 6640.

Apparently, the protest was not entertained.

Petitioner brought the case immediately to this Court without appealing the matter to the
Secretary of Labor and Employment. On May 9,1988, this Court issued a temporary
restraining order enjoining the Assistant Regional Director from enforcing his Order
dated April 7, 1988.
RULING OF THE SUPREME COURT:
1. NO. The Implementing Order cannot provide such prohibition.

Ratio:
• RA No. 6640 does not prohibit the crediting of CBA anniversary wage increases.
• Implementing rules cannot add or detract from the provisions of law it is designed
to implement.
• And so, the implementing rules cannot provide for such a prohibition not
contemplated by the law.
• Administrative regulations adopted under legislative authority should be in
harmony with the provisions of the law, and should be for the sole purpose of carrying
into effect its general provisions. The law cannot be expanded by such
regulations.
• An administrative act cannot amend an act of Congress.

2. NO. Failure to exhaust administrative remedies cannot be considered fatal to this

petition.
Ratio:
• It is fundamental that in a case where only pure questions of law are raised, the
doctrine of exhaustion of administrative remedies cannot apply because issues of law
cannot be resolved with finality by the administrative officer.
DANICA LOU S. FLORES

• Appeal to the administrative officer of orders involving questions of law would

be an exercise in futility since administrative officers cannot decide such issues with
finality. The questions raised in this petition are questions of law. Hence, the failure to
exhaust administrative remedies cannot be considered fatal to this petition.

OPINION OF THE STUDENT:

I agree with the decision of the Supreme Court that the Implementing Order of the
Secretary of Labor and Employment (DOLE) cannot provide for a prohibition not
contemplated by the law it seeks to implement. Also, Failure to exhaust administrative
remedies cannot be considered fatal to this petition.

MEYCAUAYAN COLLEGE, petitioner,

vs.
HONORABLE FRANKLIN M. DRILON, in his capacity as Secretary of the
Department of Labor and Employment and MEYCAUAYAN COLLEGE FACULTY
AND PERSONNEL ASSOCIATION (MCFPA), respondents.
G.R. No. 81144 May 7, 1990
C.J. FERNAN:

FACTS:
Petitioner is a private educational institution operating in Meycauayan, Bulacan Its
board of trustees recognized the Meycauayan College Faculty and Personnel
Association as the employees' union in the Meycauayan College. Prior to said
recognition, petitioner and the union, then headed by Mrs. Lim, entered into a collective
bargaining agreement for 1983-1986. During the lifetime of the collective bargaining
agreement, the following were issued: (a) Wage Order No. 3 - increasing the minimum
daily living allowance in the private sector; (b) Wage Order No. 4 - integrating as of said
date the emergency cost of living allowances into the basic pay of covered workers in
the private sector; (c) Wage Order No. 5 - increasing the cost of living allowance of
workers in the private sector whose basic salary or wage is not more than P1,800 a
month; and (d) Wage Order No. 6 - increasing the daily living allowances.

The union admits herein that its members were paid all these increases in pay
mandated by law. It appears, however, that new president of the union, Mrs. Villarico,
unintentionally discovered that Article IV thereof had not been implemented by the
petitioner. Consequently, the union filed with the DOLE, a notice of strike on the ground
of unfair labor practice alleging therein violation of the collective bargaining agreement.
The Secretary of Labor assumed jurisdiction over the labor dispute and instructed
Regional Office No. III to hear and receive the evidence of the parties and to submit a
report thereon.

The Director of Regional Office No. III stated that the management had indeed complied
with the salary and allowance increases ordained by law. However, he observed that the
college's compliance with said increases in salary and allowance were "not an ipso
facto compliance with the collective bargaining agreement without violating the very
DANICA LOU S. FLORES

aims and purpose of free collective bargaining for better terms and conditions of
employment." According to the Director, the two should be distinguished from each
other. Thus, while compliance with increases provided by law was mandatory,
compliance with the provisions of a collective bargaining agreement was contractual
and obligatory. Accordingly, the Director recommended that the management of
Meycauayan College be directed to immediately comply with the salary scale provision
of the collective bargaining agreement and "to pay all covered union members their
salary differential both during regular classes and summer vacations as well as the 13th
month differential pay. The Secretary of Labor agreed with the Director's findings. Its
motion for reconsideration having been denied, Meycauayan College filed the instant
petition for certiorari. The Court issued said temporary restraining order.

ISSUE:
Whether increases in employees' salaries resulting from the implementation of
presidential decrees and wage orders, which are over and above the agreed salary
scale contracted for between the employer and the employees in a collective bargaining
agreement, preclude the employees from claiming the difference between their old
salaries and those provided for under said salary scale.

LAWS APPLICABLE:

Article 291 (now Art. 290) of the Labor Code herein invoked by petitioner, provides:

Offenses. — Offenses penalized under this Code and the rules and
regulations issued pursuant thereto shall prescribe in three (3) years.

All unfair labor practices arising from Book V shall be filed with the
appropriate agency within one (1) year from accrual of such unfair labor
practice; otherwise, they shall be forever barred.

CHRONOLOGY OF THE CASE:

On March 27, 1987, the union filed with the Department of Labor and Employment,
Regional Office No. III in San Fernando, Pampanga, a notice of strike on the ground of
unfair labor practice alleging therein violation of the collective bargaining agreement
particularly the provisions of Article IV thereof on salary scale. 2

The union having struck and picketed the petitioner's premises on May 20, 1987, the
Secretary of Labor assumed jurisdiction over the labor dispute and, in his order of May
26, 1987, instructed Regional Office No. III to hear and receive the evidence of the
parties and to submit a report thereon.

In his report, the Director of Regional Office No. III stated that the management had
indeed complied with the salary and allowance increases ordained by law.
DANICA LOU S. FLORES

Accordingly, the Director recommended that the management of Meycauayan College

be directed to immediately comply with the salary scale provision of the collective
bargaining agreement.

The Secretary of Labor agreed with the Director's findings noting further that the college
"failed to controvert the assertion of the faculty members.

Its motion for reconsideration having been denied on December 3, 1987, Meycauayan
College filed the instant petition for certiorari with prayer for the issuance of a writ of
preliminary injunction and/or a temporary restraining order enjoining the Secretary of
Labor from enforcing his orders of September 9, 1987 and December 3, 1987. On
February 15, 1988, the Court issued said temporary restraining order.

RULING OF THE SUPREME COURT:

The petition has no merit. As correctly ruled by public respondent, a collective
bargaining agreement is a contractual obligation. It is distinct from an obligation
imposed by law. The terms and conditions of a collective bargaining contract constitute
the law between the parties. Beneficiaries thereof are therefore, by right, entitled to the
fulfillment of the obligation prescribed therein. Consequently, to deny binding force to
the collective bargaining agreement would place a premium on a refusal by a party
thereto to comply with the terms of the agreement. Such refusal would constitute an
unfair labor practice.

Moreover, compliance with a collective bargaining agreement is mandated by the

expressed policy to give protection to labor. Unless otherwise provided by law, said
policy should be given paramount consideration. Hence, inasmuch as the petitioner has
failed to point to any provision of law or even of the collective bargaining agreement
itself to the effect that benefits provided by the former encompass those provided by the
latter, benefits derived from either the law of a contract should be treated as distinct and
separate from each other.

Moreover, compliance with a collective bargaining agreement is mandated by the

expressed policy to give protection to labor. Unless otherwise provided by law, said
policy should be given paramount consideration. Hence, inasmuch as the petitioner has
failed to point to any provision of law or even of the collective bargaining agreement
itself to the effect that benefits provided by the former encompass those provided by the
latter, benefits derived from either the law of a contract should be treated as distinct and
separate from each other.

Moreover, compliance with a collective bargaining agreement is mandated by the

expressed policy to give protection to labor. Unless otherwise provided by law, said
policy should be given paramount consideration. Hence, inasmuch as the petitioner has
failed to point to any provision of law or even of the collective bargaining agreement
itself to the effect that benefits provided by the former encompass those provided by the
latter, benefits derived from either the law of a contract should be treated as distinct and
separate from each other.
DANICA LOU S. FLORES

OPINION OF THE STUDENTS:

I agree with the Supreme Court that there is no merit in the petition to increases in
employees' salaries resulting from the implementation of presidential decrees and wage
orders, which are over and above the agreed salary scale contracted for between the
employer and the employees in a collective bargaining agreement, preclude the
employees from claiming the difference between their old salaries and those provided
for under said salary scale.

Submitted by:

DANICA LOU S. FLORES