National Sugar Refineries Corporation Vs

National Sugar Refineries Corporation vs.
NLRC
G.R. No. 101761. March 24, 1993. *
NATIONAL SUGAR REFINERIESCORPORATION,

petitioner, vs. NATIONALLABOR RELATIONS
COMMISSION and NBSR SUPERVISORY UNION,
(PACIWU) TUCP, respondents.
Labor Law; Constitutional Law; While social justice has an
inclination to give favor and protection to the working class, the cause
of the labor sector is not upheld at all times as the management has
also a right entitled to respect and enforcement in the interest of
simple fair play.While the Constitution is committed to the policy
of social justice and the protection of the working class, it should not
be supposed that every labor dispute will be automatically decided in
favor of labor. Management also has its own rights which, as such,
are entitled to respect and enforcement in the interest of simple fair
play. Out of its concern for those with less privileges in life, this
Court has inclined more often than not toward the worker and
upheld his cause in his conflicts with the employer. Such favoritism,
however, has not blinded us to the rule that justice is in every case
for the deserving, to be dispensed in the light of the established facts
and the applicable law and doctrine.
Same; Classification of Employment; Criterion which determines
whether a particular employee is within the definition of a statute is
the character of work performed rather than title or nomenclature of
position held.The question whether a given employee is exempt
from the benefits of the law is a factual one dependent on the
circumstances of the particular case. In determining whether an
employee is within the terms of the statutes, the criterion is the
character of the work performed, rather than the title of the
employee's position. Consequently, while generally this Court is not
supposed to review the factual findings of respondent commission,
substantial justice and the peculiar circumstances obtaining herein
mandate a deviation from the rule.
Same; Same; Same; Overtime pay, etc.; Supervisory employees
discharging functions that qualify them as officers or members of the
managerial staff considered exempt from the coverage of Article 82 of
the Labor Code and therefore, not entitled to overtime, rest day and
holiday payThe members of respondent union discharge duties
and responsibilities which ineluctably qualify them as officers or
members of the
______________
*SECOND DIVISION.
453
VOL. 220, MARCH 24, 1993 453
National Sugar Refineries Corporation vs. NLRC
managerial staff, as defined in Section 2, Rule I, Book III of the
aforestated Rules to Implement the Labor Code, viz.: x x x Under the
facts obtaining in this case, we are constrained to agree with
petitioner that the union members should be considered as officers or
members of the managerial staff and are, therefore, exempt from the
coverage of Article 82. Perforce, they are not entitled to overtime,
rest day and holiday pay.
Same; Same; Same; Same; Payment of the questioned benefits
has not ripened into a contractual obligation as payment thereof was
made at a time when they were rightfully entitled thereto.We
likewise do not subscribe to the finding of the labor arbiter that the
payment of the questioned benefits to the union members has
ripened into a contractual obligation. x x x The members of
respondent union were paid the questioned benefits for the reason
that, at that time, they were rightfully entitled thereto. Prior to the
JE Program, they could not be categorically classified as members or
officers of the managerial staff considering that they were then
treated merely on the same level as rank-and-file. Consequently, the
payment thereof could not be construed as constitutive of voluntary
employer practice, which cannot now be unilaterally withdrawn by
petitioner.
Same; Same; Same; Same; Same; Entitlement to benefits
provided for by law requires prior compliance with conditions set
forth therein.Quintessentially, with the promotion of the union
members, they are no longer entitled to the benefits which attach
and pertain exclusively to their former positions. Entitlement to the
benefits provided for by law requires prior compliance with the
conditions set forth therein. With the promotion of the members of
respondent union, they occupied positions which no longer meet the
requirements imposed by law. Their assumption of these positions
removed them from the coverage of the law, ergo, their exemption
therefrom.
Same; Management Prerogatives; Promotion of employees is a
recognized management prerogative to be exercised in good faith;
Case at bar.Promotion of its employees is one of the
jurisprudentiallyrecognized exclusive prerogatives of management,
provided it is done in good faith. In the case at bar, private
respondent union has miserably failed to convince this Court that
the petitioner acted in bad faith in implementing the JE Program.
There is no showing that the JE Program was intended to
circumvent the law and deprive the members of respondent union of
the benefits they used to receive.
PETITION for certiorari of the decision of
the National Labor
454
454 SUPREME COURT REPORTS ANNOTATED
Relations Commission.
The facts are stated in the opinion of the Court.
Jose Mario C. Bunag for petitioner.
The Solicitor General and the Chief Legal
Officer, NLRC, for public respondent.
Zoilo V. de la Cruz for private respondent.
REGALADO, J.:
The main issue presented for resolution in this original

petition for certiorari is whether supervisory employees, as
defined in Article 212(m), Book V of the Labor Code, should
be considered as officers or members of the managerial staff
under Article 82, Book III of the same Code, and hence are
not entitled to overtime, rest day and holiday pay.
Petitioner National Sugar RefineriesCorporation (NAS
UREFCO), a corporationwhich is fully owned and controlled
by the Government, operates three
(3) sugarrefineries located at Bukidnon, Iloilo and
Batangas. The Batangas refinery was privatized on April 11,
1992 pursuant to Proclamation No. 50.1 Private respondent
union represents the former supervisors of the NASUREFCO
Batangas Sugar Refinery, namely, the Technical Assistant to
the Refinery Operations Manager, Shift Sugar Warehouse
Supervisor, Senior Financial/Budget Analyst, General
Accountant, Cost Accountant, SugarAccountant, Junior
Financial/Budget Analyst, Shift Boiler Supervisor, Shift
Operations Chemist, Shift Electrical Supervisor, General
Services Supervisor, Instrumentation Supervisor, Community
Development Officer, Employment and Training Supervisor,
Assistant Safety and Security Officer, Head of Personnel
Services, Head Nurse, Property Warehouse Supervisor, Head
of Inventory Control Section, Shift Process Supervisor,
Assistant Shift Process Supervisor, Shift R/M Supervisor, Day
Maintenance Supervisor and Motorpool Supervisor.
On June 1, 1988, petitioner implemented a Job Evaluation
(JE) Program affecting all employees, from rank-and-file to
deRollo, 209.
455
VOL. 220, MARCH 24, 1993 455
partment heads. The JE Program was designed to rationalize
the duties and functions of all positions, reestablish levels of
responsibility, and reorganize both wage and operational
structures. Jobs were ranked according to effort,
responsibility, training and working conditions and relative
worth of the job. As a result, all positions were re-evaluated,
and all employees including the members of respondent union
were granted salary adjustments and increases in benefits
commensurate to their actual duties and functions.
We glean from the records that for about ten years prior to
the JE Program, the members of respondent union were
treated in the same manner as rank-and-file employees. As
such, they used to be paid overtime, rest day and holiday pay
pursuant to the provisions of Articles 87, 93 and 94 of the
Labor Code, as amended. With the implementation of the JE
Program, the following adjustments were made: (1) the
members of respondent union were re-classified under levels
S-5 to S-8 which are considered managerial staff for purposes
of compensation and benefits; (2) there was an increase in
basic pay on the average of 50% of their basic pay prior to the
JE Program, with the union members now enjoying a wide
gap (P1,269.00 per month) in basic pay compared to the
highest paid rank-and-file employee; (3) longevity pay was
increased on top of alignment adjustments; (4) they were
entitled to increased company COLA of P225.00 per month;
and (5) there was a grant of P100.00 allowance for rest
day/holiday work.
On May 11, 1990, petitioner NASUREFCO recognized
herein respondent union, which was organized pursuant to
Republic Act No. 6715 allowing supervisory employees to
form their own unions, as the bargaining representative of all
the supervisory employees at the NASUREFCO
Batangas Sugar Refinery.
Two years after the implementation of the JE Program,
specifically on June 20, 1990, the members of herein
respondent union filed a complaint with the executive labor
arbiter for non-payment of overtime, rest day and holiday pay
allegedly in violation of Article 100 of the Labor Code.
On January 7, 1991, Executive Labor Arbiter Antonio C.
Pido rendered a decision disposing as follows:2
_____________
2 Annex E, Petition; Rollo, 51, 56-57.

456
"WHEREFORE, premises considered, respondent National Sugar Refineries Corporation is hereby
directed to
1. 1.pay the individual members of complainant union the usual overtime pay, restday pay and
holiday pay enjoyed by them instead of the P100.00 special allowance which was
implemented on June 11, 1988; and
2. 2.pay the individual members of complainant union the difference in money value between the
P100.00 special allowance and the overtime pay, restday pay and holiday pay that they ought
to have received from June 1, 1988.
All other claims are hereby dismissed for lack of merit.

SO ORDERED."
In finding for the members of herein respondent union, the
labor arbiter ruled that the long span of time during which
the benefits were being paid to the supervisors has caused the
payment thereof to ripen into a contractual obligation; that
the complainants cannot be estopped from questioning the
validity of the new compensation package despite the fact
that they have been receiving the benefits therefrom,
considering that respondent union was formed only a year
after the implementation of the Job Evaluation Program,
hence there was no way for the individual supervisors to
express their collective response thereto prior to the
formation of the union; and the comparative computations
presented by the private respondent union showed that the P
100.00 special allowance given by NASUREFCO fell short of
what the supervisors ought to receive had the overtime pay,
rest day pay and holiday pay not been discontinued, which
arrangement, therefore, amounted to a diminution of benefits.
On appeal, in a decision promulgated on July 19, 1991 by
its Third Division, respondent National Labor Relations
Commission (NLRC) affirmed the decision of the labor arbiter
on the ground that the members of respondent union are not
managerial employees, as defined under Article 212(m) of the
Labor Code and, therefore, they are entitled to overtime, rest
day and holiday pay. Respondent NLRC declared that these
supervisory employees are merely exercising recommendatory
powers subject to the evaluation, review and final action by
their department heads; their responsibilities do not require
the exercise of discretion and independent judgment; they do
not participate in the formulation of management policies nor
in the hiring or firing of employ-
457
VOL. 220, MARCH 24, 1993 457
ees; and their main function is to carry out the ready policies
and plans of the corporation. Reconsideration of said
3
decision was denied in a resolution of public respondent dated

August 30, 1991. 4
Hence this petition for certiorari, with petitioner
NASUREFCO asseverating that public respondent
commission committed a grave abuse of discretion in refusing
to recognize the fact that the members of respondent union
are members of the managerial staff who are not entitled to
overtime, rest day and holiday pay; and in making petitioner
assume the "double burden" of giving the benefits due to
rank-and-file employees together with those due to
supervisors under the JE Program.
We find creditable merit in the petition and the
extraordinary writ of certiorari shall accordingly issue.
The primordial issue to be resolved herein is whether the
members of respondent union are entitled to overtime, rest
day and holiday pay. Before this can be resolved, however, it
must of necessity be ascertained first whether or not the
union members, as supervisory employees, are to be
considered as officers or members of the managerial staff who
are exempt from the coverage of Article 82 of the Labor Code.
It is not disputed that the members of respondent union are
supervisory employees, as defined under Article 212(m), Book
V of the Labor Code on Labor Relations, which reads:
"(m) 'Managerial employee' is one who is vested with powers or prerogatives to lay down and execute
management policies and/or to hire, transfer, suspend, lay-off, recall, discharge, assign or discipline
employees. Supervisory employees are those who, in the interest of the employer, effectively
recommend such managerial actions if the exercise of such authority is not merely routinary or clerical
in nature but requires the use of independent judgment. All employees not falling within any of the
above definitions are considered rank-and-file employees for purposes of this Book."
Respondent NLRC, in holding that the union members are
entitled to overtime, rest day and holiday pay, and in ruling
that
_____________
3 Annex A, id.; ibid., 20-27; NLRC Case CA No. L-000058; penned by Pres. Comm. Lourdes C. Javier, with the
concurrence of Comm. Ireneo B. Bernardo and Rogelio I. Rayala.

4 Rollo, 28-29.
458
the latter are not managerial employees, adopted the
definition stated in the aforequoted statutory provision.
Petitioner, however, avers that for purposes of determining
whether or not the members of respondent union are entitled
to overtime, rest day and holiday pay, said employees should
be considered as "officers or members of the managerial staff'
as defined under Article 82, Book III of the Labor Code on
'Working Conditions and Rest Periods" and amplified in
Section 2, Rule I, Book III of the Rules to Implement the
Labor Code, to wit:
"Art. 82. Coverage.The provisions of this title shall apply to employees in all establishments and
undertakings whether for profit or not, but not to government employees, managerial employees, field
personnel, members of the family of the employer who are dependent on him for support, domestic
helpers, persons in the personal service of another, and workers who are paid by results as determined
by the Secretary of Labor in appropriate regulations.
"As used herein, 'managerial employees' refer to those whose primary duty consists of the
management of the establishment in which they are employed or of a department or subdivision
thereof, and to other officers or members of the managerial staff." (Emphasis supplied.)
xxx
"Sec. 2. Exemption.The provisions of this rule shall not apply to the following persons if they
qualify for exemption under the condition set forth herein:
xxx
1. (b)Managerial employees, if they meet all of the

following conditions, namely:
1. (1)Their primary duty consists of the management of

the establishment in which they are employed or of a
department or subdivision thereof;
2. (2)They customarily and regularly direct the work of
two or more employees therein;
3. (3)They have the authority to hire or fire other
employees of lower rank; or their suggestions and
recommendations as to the hiring and firing and as to
the promotion or any other change of status of other
employees are given particular weight.
1. (c)Officers or members of a managerial staff if they

perform the following duties and responsibilities:
1. (1)The primary duty consists of the performance of

work directly related to management policies of their
employer;
459
VOL. 220, MARCH 24, 1993 459
1. (2)Customarily and regularly exercise discretion and

independent judgment;
2. (3)(i) Regularly and directly assist a proprietor or a
managerial employee whose primary duty consists of
the management of the establishment in which he is
employed or subdivision thereof; or (ii) execute under
general supervision work along specialized or technical
lines requiring special training, experience, or
knowledge; or (iii) execute under general supervision
special assignments and tasks; and
3. (4)Who do not devote more than 20 percent of their
hours worked in a work-week to activities which are not
directly and closely related to the performance of the
work described in paragraphs (1), (2), and (3) above."
It is the submission of petitioner that while the members of

respondent union, as supervisors, may not be occupying
managerial positions, they are clearly officers or members of
the managerial staff because they meet all the conditions
prescribed by law and, hence, they are not entitled to
overtime, rest day and holiday pay. It contends that the
definition of managerial and supervisory employees under
Article 212(m) should be made to apply only to the provisions
on Labor Relations, while the right of said employees to the
questioned benefits should be considered in the light of the
meaning of a managerial employee and of the officers or
members of the managerial staff, as contemplated under
Article 82 of the Code and Section 2, Rule I, Book III of the
implementing rules. In other words, for purposes of forming
and joining unions, certification elections, collective
bargaining, and so forth, the union members are supervisory
employees. In terms of working conditions and rest periods
and entitlement to the questioned benefits, however, they are
officers or members of the managerial staff, hence they are
not entitled thereto.
While the Constitution is committed to the policy of social
justice and the protection of the working class, it should not
be supposed that every labor dispute will be automatically
decided in favor of labor. Management also has its own rights
which, as such, are entitled to respect and enforcement in the
interest of simple fair play. Out of its concern for those with
less privileges in life, this Court has inclined more often than
not toward the worker and upheld his cause in his conflicts
with the employer. Such favoritism, however, has not blinded
us to the rule that
460
justice is in every case for the deserving, to be dispensed in
the light of the established facts and the applicable law and
doctrine.5
This is one such case where we are inclined to tip the scales
of justice in favor of the employer.
The question whether a given employee is exempt from the
benefits of the law is a factual one dependent on the
circumstances of the particular case. In determining whether
an employee is within the terms of the statutes, the criterion
is the character of the work performed, rather than the title of
the employee's position. 6
Consequently, while generally this Court is not supposed to

review the factual findings of respondent commission,
substantial justice and the peculiar circumstances obtaining
herein mandate a deviation from the rule.
A cursory perusal of the Job Value Contribution
Statements of the union members will readily show that
7
these supervisory employees are under the direct supervision

of their respective department superintendents and that
generally they assist the latter in planning, organizing,
staffing, directing, controlling, communicating and in making
decisions in attaining the company's set goals and objectives.
These supervisory employees are likewise responsible for the
effective and efficient operation of their respective
departments. More specifically, their duties and functions
include, among others, the following operations whereby the
employee:
1. 1)assists the department superintendent in the

following:
1. a)planning of systems and procedures relative to

department activities;
2. b)organizing and scheduling of work activities of the
department, which includes employee shifting schedule
and manning complement;
3. c)decision making g by providing relevant information
data and other inputs;
4. d)attaining the company's set goals and objectives by
_____________
5 Sosito vs. Aguinaldo Development Corporation, 156 SCRA 392 (1987).

6 56 C.J.S., Master and Servant, Sec. 151(11).
7 Annexes I to I-23, Petition; Rollo, 84-149.
461
VOL. 220, MARCH 24, 1993 461
1. giving his full support;

2. e)selecting the appropriate man to handle the job in the
department; and
3. f)preparing annual departmental budget;
1. 2)observes, follows and implements company policies at

all times and recommends disciplinary action on erring
subordinates;
2. 3)trains and guides subordinates on how to assume
responsibilities and become more productive;
3. 4)conducts semi-annual performance evaluation of his
subordinates and recommends necessary action for
their development/advancement;
4. 5)represents the superintendent or the department
when appointed and authorized by the former;
5. 6)coordinates and communicates with other inter and
intra department supervisors when necessary;
6. 7)recommends disciplinary actions/promotions;
7. 8)recommends measures to improve work methods,
equipment performance, quality of service and working
conditions;
8. 9)sees to it that safety rules and regulations and
procedure are implemented and followed by all
NASUREFCO employees, recommends revisions or
modifications to said rules when deemed necessary, and
initiates and prepares reports for any observed
abnormality within the refinery;
9. 10)supervises the activities of all personnel under him
and sees to it that instructions to subordinates are
properly implemented; and
10. 11)performs other related tasks as may be assigned
by his immediate superior.
From the foregoing, it is apparent that the members of

respondent union discharge duties and responsibilities which
ineluctably qualify them as officers or members of the
managerial staff, as defined in Section 2, Rule I, Book III of
the aforestated Rules to Implement the Labor Code, viz.: (1)
their primary duty consists of the performance of work
directly related to management policies of their employer; (2)
they customarily and regularly exercise discretion and
independent judgment; (3) they regularly and directly assist
the managerial employee whose primary duty consists of the
management of a department of the establishment in which
they are employed; (4) they execute, under general
supervision, work along specialized or technical lines
requiring special training, experience, or knowledge; (5) they
execute, under general supervision, special assignments and
tasks; and
462
(6) they do not devote more than 20% of their hours worked in
a work-week to activities which are not directly and clearly
related to the performance of their work hereinbefore
described.
Under the facts obtaining in this case, we are constrained
to agree with petitioner that the union members should be
considered as officers or members of the managerial staff and
are, therefore, exempt from the coverage of Article 82.
Perforce, they are not entitled to overtime, rest day and
holiday pay.
The distinction made by respondent NLRCon the basis of
whether or not the union members are managerial
employees, to determine the latter's entitlement to the
questioned benefits, is misplaced and inappropriate. It is
admitted that these union members are supervisory
employees and this is one instance where the nomenclatures
or titles of their jobs conform with the nature of their
functions. Hence, to distinguish them from a managerial
employee, as defined either under Articles 82 or 212(m) of the
Labor Code, is puerile and inefficacious. The controversy
actually involved here seeks a determination of whether or
not these supervisory employees ought to be considered
as officers or members of the managerial staff. The distinction,
therefore, should have been made along that line and its
corresponding conceptual criteria.
II. We likewise do not subscribe to the finding of the labor
arbiter that the payment of the questioned benefits to the
union members has ripened into a contractual obligation.
1. A.Prior to the JE Program, the union members, while
being supervisors, received benefits similar to the rank-
and-file employees such as overtime, rest day and
holiday pay, simply because they were treated in the
same manner as rank-and-file employees, and their
basic pay was nearly on the same level as those of the
latter, aside from the fact that their specific functions
and duties then as supervisors had not been properly
defined and delineated from those of the rank-and-file.
Such fact is apparent from the clarification made by
petitioner in its motion for reconsideration filed with 8
respondent commission in NLRC Case No. CA No. I-

000058, dated August 16, 1991, wherein it lucidly
explained:
_____________
8 Annex G, Petition; Rollo, 72.

463
VOL. 220, MARCH 24, 1993 463
"But, complainants no longer occupy the same positions they held before the JE Program. Those
positions formerly classified as 'supervisory' and found after the JE Program to be rank-and-file were
classified correctly and continue to receive overtime, holiday and restday pay. As to them, the practice
subsists.
"However, those whose duties confirmed them to be supervisory, were re-evaluated, their duties re-
defined and in most cases their organizational positions re-designated to confirm their superior rank
and duties. Thus, after the JE program, complainants cannot be said to occupy the same positions." 9
It bears mention that this positional submission was never

refuted nor controverted by respondent union in any of its
pleadings filed before herein public respondent or with this
Court. Hence, it can be safely concluded therefrom that the
members of respondent union were paid the questioned
benefits for the reason that, at that time, they were rightfully
entitled thereto. Prior to the JE Program, they could not be
categorically classified as members or officers of the
managerial staff considering that they were then treated
merely on the same level as rankand-file. Consequently, the
payment thereof could not be construed as constitutive of
voluntary employer practice, which cannot now be
unilaterally withdrawn by petitioner. To be considered as
such, it should have been practiced over a long period of time,
and must be shown to have been consistent and deliberate. 10
The test or rationale of this rule on long practice requires

an indubitable showing that the employer agreed to continue
giving the benefits knowing fully well that said employees are
not covered by the law requiring payment thereof. In the 11
case at bar, respondent union failed to sufficiently establish

that petitioner has been motivated or is wont to give these
benefits out of pure generosity.
1. B.It remains undisputed that with the implementation

of the JE Program, the members of private respondent
union were
_____________
9 Rollo, 79.
10 Globe Mackay Cable and Radio Corporation, et al. vs. NLRC, et al., 163 SCRA 71 (1988).
11 Oceanic Pharmacal Employees Union (FFW) vs. Inciong, et al., 94 SCRA 270 (1979).
464
National Sugar Refineries Corporation us. NLRC
1. re-classified under levels S-5 to S-8 which were

considered under the program as managerial staff for
purposes of compensation and benefits, that they
occupied re-evaluated positions, and that their basic
pay was increased by an average of 50% of their basic
salary prior to the JE Program. In other words, after
the JE Program there was an ascent in position, rank
and salary. This in essence is a promotion which is
defined as the advancement from one position to
another with an increase in duties and responsibilities
as authorized by law, and usually accompanied by an
increase in salary. 12
Quintessentially, with the promotion of the union members,

they are no longer entitled to the benefits which attach and
pertain exclusively to their former positions. Entitlement to
the benefits provided for by law requires prior compliance
with the conditions set forth therein. With the promotion of
the members of respondent union, they occupied positions
which no longer meet the requirements imposed by law.
Their assumption of these positions removed them from the
coverage of the law, ergo, their exemption therefrom.
As correctly pointed out by petitioner, if the union members
really wanted to continue receiving the benefits which attach
to their former positions, there was nothing to prevent them
from refusing to accept their promotions and their
corresponding benefits. As the saying goes, they cannot have
their cake and eat it too or, as petitioner suggests, they
should not, as a simple matter of law and fairness, get the
best of both worlds at the expense of NASUREFCO.
Promotion of its employees is one of the jurisprudentially-
recognized exclusive prerogatives of management, provided it
is done in good faith. In the case at bar, private respondent
union has miserably failed to convince this Court that the
petitioner acted in bad faith in implementing the JE Program.
There is no showing that the JE Program was intended to
circumvent the law and deprive the members of respondent
union of the benefits they used to receive.
Not so long ago, on this particular score, we had the
occasion to
_____________
12 Millares vs. Subido, et al., 20 SCRA 954 (1967); Dosch vs. NLRC, et al., 123 SCRA 296 (1983).
465
VOL. 220, MARCH 24, 1993 465
hold that:
"x x x it is the prerogative of management to regulate, according to its discretion and judgment, all
aspects of employment. This flows from the established rule that labor law does not authorize the
substitution of the judgment of the employer in the conduct of its business. Such management
prerogative may be availed of without fear of any liability so long as it is exercised in good faith for the
advancement of the employers' interest and not for the purpose of defeating or circumventing the rights
of employees under special laws or valid agreement and are not exercised in a malicious, harsh,
oppressive, vindictive or wanton manner or out of malice or spite." 13
WHEREFORE, the impugned decision and resolution of
respondent National Labor Relations Commission
promulgated on July 19, 1991 and August 30, 1991,
respectively, are hereby ANNULLED and SET ASIDE for
having been rendered and adopted with grave abuse of
discretion, and the basic complaint of private respondent
union is DISMISSED.
Narvasa (C.J.,
Chairman), Padilla, Nocon and Campos, Jr., JJ., concur.
Resolution annulled and set aside.
Note.Entitlement to overtime pay must first be
established by proof that said overtime work was actually
performed, before an employee may avail of said benefit
(Cagampan vs. National Labor Relations Commission, 195
SCRA 533).
Auto Bus Transport Systems, Inc. vs. Bautista

G.R. No. 156367. May 16, 2005. *
AUTO BUS TRANSPORT SYSTEMS, INC.,

petitioner, vs. ANTONIO BAUTISTA, respondent.
Labor Law; Service Incentive Leave; Field Personnel; Words and
Phrases; The phrase other employees whose performance is
unsupervised by the employer in Section 1(D), Rule V, Book III of the
Implementing Rules and Regulations of the Labor Code must not be
understood as a separate classification of employees to which service
incentive leave shall not be grantedrather, it serves as an
amplification of the interpretation of the definition of field personnel
under the Labor Code as those whose actual hours of work in the
field cannot be determined with reasonable certainty; Employees
engaged on task or contract basis or paid on purely commission basis
are not automatically exempted from the grant of service incentive
leave, unless, they fall under the classification of field personnel.A
careful perusal of said provisions of law will result in the conclusion
that the grant of service incentive leave has been delimited by the
Implementing Rules and Regulations of the Labor Code to apply only
to those employees not explicitly excluded by Section 1 of Rule V.
According to the Implementing Rules, Service Incentive Leave shall
not apply to employees classified as field personnel. The phrase
other employees whose performance is unsupervised by the
employer must not be understood as a separate classification of
employees to which service incentive leave shall not be granted.
Rather, it serves as an amplification of the interpretation of the
definition of field personnel under the Labor Code as those whose
actual hours of work in the field cannot be determined with
reasonable certainty. The same is true with respect to the phrase
those who are engaged on task or contract basis, purely commission
basis. Said phrase should be related with field personnel, applying
the rule on ejusdem generisthat general and unlimited terms are
restrained and limited by the particular terms that they follow.
Hence, employees engaged on task or contract basis or paid on
purely commission basis are not automatically exempted from the
grant of service incentive leave, unless, they fall under the
classification of field personnel.
_______________
*SECOND DIVISION.
579
VOL. 458, MAY 16, 2005 579
Same; Same; Same; Same; What must be ascertained in order to
resolve the issue of propriety of the grant of service incentive leave to a
bus driver-conductor is whether or not he is a field personnel;
According to the Labor Code, field personnel shall refer to
nonagricultural employees who regularly perform their duties away
from the principal place of business or branch office of the employer
and whose actual hours of work in the field cannot be determined
with reasonable certainty.Petitioners contention that respondent
is not entitled to the grant of service incentive leave just because he
was paid on purely commission basis is misplaced. What must be
ascertained in order to resolve the issue of propriety of the grant of
service incentive leave to respondent is whether or not he is a field
personnel. According to Article 82 of the Labor Code, field
personnel shall refer to non-agricultural employees who regularly
perform their duties away from the principal place of business or
branch office of the employer and whose actual hours of work in the
field cannot be determined with reasonable certainty. This definition
is further elaborated in the Bureau of Working Conditions (BWC),
Advisory Opinion to Philippine Technical-Clerical Commercial
Employees Association which states that: As a general rule, [field
personnel] are those whose performance of their job/service is not
supervised by the employer or his representative, the workplace
being away from the principal office and whose hours and days of
work cannot be determined with reasonable certainty; hence, they
are paid specific amount for rendering specific service or performing
specific work. If required to be at specific places at specific times,
employees including drivers cannot be said to be field personnel
despite the fact that they are performing work away from the
principal office of the employee.
Same; Same; Same; Same; The definition of a field personnel is
not merely concerned with the location where the employee regularly
performs his duties but also with the fact that the employees
performance is unsupervised by the employerin order to conclude
whether an employee is a field employee, it is also necessary to
ascertain if actual hours of work in the field can be determined with
reasonable certainty by the employer.At this point, it is necessary
to stress that the definition of a field personnel is not merely
concerned with the location where the employee regularly performs
his duties but also with the fact that the employees performance is
unsupervised by the employer. As discussed above, field personnel
are those who regularly perform their duties away from the principal
580
80
place of business of the employer and whose actual hours of work
in the field cannot be determined with reasonable certainty. Thus, in
order to conclude whether an employee is a field employee, it is also
necessary to ascertain if actual hours of work in the field can be
determined with reasonable certainty by the employer. In so doing,
an inquiry must be made as to whether or not the employees time
and performance are constantly supervised by the employer.
Same; Same; Same; Same; Bus Drivers and Conductors; A bus
driver-conductor, not being a field personnel but a regular employee
who performs tasks usually necessary and desirable to the usual
trade of the companys business, is entitled to the grant of service
incentive leave.As observed by the Labor Arbiter and concurred in
by the Court of Appeals: It is of judicial notice that along the routes
that are plied by these bus companies, there are its inspectors
assigned at strategic places who board the bus and inspect the
passengers, the punched tickets, and the conductors reports. There
is also the mandatory once-a-week car barn or shop day, where the
bus is regularly checked as to its mechanical, electrical, and
hydraulic aspects, whether or not there are problems thereon as
reported by the driver and/or conductor. They too, must be at specific
place as [sic] specified time, as they generally observe prompt
departure and arrival from their point of origin to their point of
destination. In each and every depot, there is always the Dispatcher
whose function is precisely to see to it that the bus and its crew leave
the premises at specific times and arrive at the estimated proper
time. These, are present in the case at bar. The driver, the
complainant herein, was therefore under constant supervision while
in the performance of this work. He cannot be considered a field
personnel. We agree in the above disquisition. Therefore, as correctly
concluded by the appellate court, respondent is not a field personnel
but a regular employee who performs tasks usually necessary and
desirable to the usual trade of petitioners business. Accordingly,
respondent is entitled to the grant of service incentive leave.
Same; Same; Prescription; In the computation of the three-year
prescriptive period, a determination must be made as to the period
when the act constituting a violation of the workers right to the
benefits being claimed was committed.It is settled jurisprudence
that a cause of action has three elements, to wit, (1) a right in favor
of the plaintiff by whatever means and under whatever law it arises
or is
581
VOL. 458, MAY 16, 2005 581
created; (2) an obligation on the part of the named defendant to
respect or not to violate such right; and (3) an act or omission on the
part of such defendant violative of the right of the plaintiff or
constituting a breach of the obligation of the defendant to the
plaintiff. To properly construe Article 291 of the Labor Code, it is
essential to ascertain the time when the third element of a cause of
action transpired. Stated differently, in the computation of the three-
year prescriptive period, a determination must be made as to the
period when the act constituting a violation of the workers right to
the benefits being claimed was committed. For if the cause of action
accrued more than three (3) years before the filing of the money
claim, said cause of action has already prescribed in accordance with
Article 291.
Same; Same; Same; It is essential to recognize that the service
incentive leave is a curious animal in relation to other benefits
granted by law to every employee; If the employee entitled to service
incentive leave does not use or commute the same, he is entitled upon
his resignation or separation from work to the commutation of his
accrued service incentive leave.It is essential at this point,
however, to recognize that the service incentive leave is a curious
animal in relation to other benefits granted by the law to every
employee. In the case of service incentive leave, the employee may
choose to either use his leave credits or commute it to its monetary
equivalent if not exhausted at the end of the year. Furthermore, if
the employee entitled to service incentive leave does not use or
commute the same, he is entitled upon his resignation or separation
from work to the commutation of his accrued service incentive leave.
As enunciated by the Court in Fernandez v. NLRC: The clear policy
of the Labor Code is to grant service incentive leave pay to workers
in all establishments, subject to a few exceptions. Section 2, Rule V,
Book III of the Implementing Rules and Regulations provides that
[e]very employee who has rendered at least one year of service shall
be entitled to a yearly service incentive leave of five days with pay.
Service incentive leave is a right which accrues to every employee
who has served within 12 months, whether continuous or broken
reckoned from the date the employee started working, including
authorized absences and paid regular holidays unless the working
days in the establishment as a matter of practice or policy, or that
provided in the employment contracts, is less than 12 months, in
which case said period shall be considered as one year. It is
also commutable to its money equiva-
582
82
lent if not used or exhausted at the end of the year. In other
words, an employee who has served for one year is entitled to it. He
may use it as leave days or he may collect its monetary value. To limit
the award to three years, as the solicitor general recommends, is to
unduly restrict such right.
Same; Same; Same; With regard to service incentive leave, the
three-year prescriptive period commences, not at the end of the year
when the employee becomes entitled to the commutation of his service
incentive leave, but from the time when the employer refuses to pay its
monetary equivalent after demand or commutation or upon
termination of the employees services, as the case may be.
Correspondingly, it can be conscientiously deduced that the cause of
action of an entitled employee to claim his service incentive leave
pay accrues from the moment the employer refuses to remunerate its
monetary equivalent if the employee did not make use of said leave
credits but instead chose to avail of its commutation. Accordingly, if
the employee wishes to accumulate his leave credits and opts for its
commutation upon his resignation or separation from employment,
his cause of action to claim the whole amount of his accumulated
service incentive leave shall arise when the employer fails to pay
such amount at the time of his resignation or separation from
employment. Applying Article 291 of the Labor Code in light of this
peculiarity of the service incentive leave, we can conclude that the
three (3)-year prescriptive period commences, not at the end of the
year when the employee becomes entitled to the commutation of his
service incentive leave, but from the time when the employer refuses
to pay its monetary equivalent after demand of commutation or upon
termination of the employees services, as the case may be.
Same; Same; Same; Social Justice; The Courts construal of Art.
291 of the Labor Code, vis--vis the rules on service incentive leave, is
in keeping with the rudimentary principle that in the implementation
and interpretation of the provisions of the Labor Code and its
implementing regulations, the workingmans welfare should be the
primordial and paramount consideration.The above construal of
Art. 291, vis--vis the rules on service incentive leave, is in keeping
with the rudimentary principle that in the implementation and
interpretation of the provisions of the Labor Code and its
implementing regulations, the workingmans welfare should be the
primordial and paramount consideration. The policy is to extend the
applicabil-
583
VOL. 458, MAY 16, 2005 583
ity of the decree to a greater number of employees who can avail
of the benefits under the law, which is in consonance with the
avowed policy of the State to give maximum aid and protection to
labor.
PETITION for review on certiorari of the decision and

resolution of the Court of Appeals.

Edmundo A. Cruz for petitioner.
Joseph D. Sagampud, Jr. for private respondent.
CHICO-NAZARIO, J.:
Before Us is a Petition for Review on Certiorariassailing the

Decision and Resolution of the Court of Appeals affirming
1 2
the Decision of the National Labor Relations Commission

3
(NLRC). The NLRC ruling modified the Decision of the Labor

Arbiter (finding respondent entitled to the award of 13th
month pay and service incentive leave pay) by deleting the
award of 13th month pay to respondent.
The Facts
Since 24 May 1995, respondent Antonio Bautista has been
employed by petitioner Auto Bus Transport Systems, Inc.
(Autobus), as driver-conductor with travel routes Manila-
Tuguegarao via Baguio, Baguio- Tuguegarao via Manila and
Manila-Tabuk via Baguio. Respondent was paid on
commission basis, seven percent (7%) of the total gross income
per travel, on a twice a month basis.
_______________
1 CA-G.R. SP No. 68395, dated 06 May 2002, penned by Associate Justice Andres B. Reyes, Jr. with Associate
Justices Conrado M. Vasquez, Jr. and Mario L. Guaria, III, concurring.

2 Dated 12 December 2002.
3 NLRC NCR CA No. 026584-2000 (NLRC Case No. RAB CAR 02-0088-00), dated 28 September 2001.
584
On 03 January 2000, while respondent was driving
Autobus No. 114 along Sta. Fe, Nueva Vizcaya, the bus he
was driving accidentally bumped the rear portion of
Autobus No. 124, as the latter vehicle suddenly stopped at a
sharp curve without giving any warning.
Respondent averred that the accident happened because he
was compelled by the management to go back to Roxas,
Isabela, although he had not slept for almost twenty-four (24)
hours, as he had just arrived in Manila from Roxas, Isabela.
Respondent further alleged that he was not allowed to work
until he fully paid the amount of P75,551.50, representing
thirty percent (30%) of the cost of repair of the damaged buses
and that despite respondents pleas for reconsideration, the
same was ignored by management. After a month,
management sent him a letter of termination.
Thus, on 02 February 2000, respondent instituted a
Complaint for Illegal Dismissal with Money Claims for
nonpayment of 13th month pay and service incentive leave
pay against Autobus.
Petitioner, on the other hand, maintained that respon-
dents employment was replete with offenses involving
reckless imprudence, gross negligence, and dishonesty. To
support its claim, petitioner presented copies of letters,
memos, irregularity reports, and warrants of arrest
pertaining to several incidents wherein respondent was
involved.
Furthermore, petitioner avers that in the exercise of its
management prerogative, respondents employment was
terminated only after the latter was provided with an
opportunity to explain his side regarding the accident on 03
January 2000.
On 29 September 2000, based on the pleadings and
supporting evidence presented by the parties, Labor Arbiter
Monroe C. Tabingan promulgated a Decision, the dispositive
4
portion of which reads:

_______________
4 NLRC Case No. RAB-CAR-02-0088-00.

585
VOL. 458, MAY 16, 2005 585
WHEREFORE, all premises considered, it is hereby found that the complaint for Illegal Dismissal
has no leg to stand on. It is hereby ordered DISMISSED, as it is hereby DISMISSED.
However, still based on the above-discussed premises, the respondent must pay to the complainant
the following:
1. a.his 13th month pay from the date of his hiring to the date of his dismissal, presently
computed at P78,117.87;
2. b.his service incentive leave pay for all the years he had been in service with the respondent,
presently computed at P13,788.05.
All other claims of both complainant and respondent are hereby dismissed for lack of merit. 5
Not satisfied with the decision of the Labor Arbiter, petitioner

appealed the decision to the NLRC which rendered its
decision on 28 September 2001, the decretal portion of which
reads:
[T]he Rules and Regulations Implementing Presidential Decree No. 851, particularly Sec. 3 provides:
Section 3. Employers covered.The Decree shall apply to all employers except to:
xxx xxx xxx
e) employers of those who are paid on purely commission, boundary, or task basis, performing a specific work,
irrespective of the time consumed in the performance thereof.
x x x.
Records show that complainant, in his position paper, admitted that he was paid on a commission
basis.
In view of the foregoing, we deem it just and equitable to modify the assailed Decision by deleting
the award of 13th month pay to the complainant.
...
_______________
5 Rollo, pp. 46-47.

586
WHEREFORE, the Decision dated 29 September 2000 is MODIFIED by deleting the award of 13th
month pay. The other findings are AFFIRMED. 6
In other words, the award of service incentive leave pay was

maintained. Petitioner thus sought a reconsideration of this
aspect, which was subsequently denied in a Resolution by the
NLRC dated 31 October 2001.
Displeased with only the partial grant of its appeal to the
NLRC, petitioner sought the review of said decision with the
Court of Appeals which was subsequently denied by the
appellate court in a Decision dated 06 May2002, the
dispositive portion of which reads:
WHEREFORE, premises considered, the Petition is DISMISSED for lack of merit; and the assailed
Decision of respondent Commission in NLRC NCR CA No. 026584-2000 is hereby AFFIRMED in
toto. No costs. 7
Hence, the instant petition.

Issues
1. 1.Whether or not respondent is entitled to service

incentive leave;
2. 2.Whether or not the three (3)-year prescriptive period
provided under Article 291 of the Labor Code, as
amended, is applicable to respondents claim of service
incentive leave pay.
Ruling of the Court
The disposition of the first issue revolves around the proper
interpretation of Article 95 of the Labor Code vis--vis Section
1(D), Rule V, Book III of the Implementing Rules and
Regulations of the Labor Code which provides:
_______________
6 Rollo, pp. 52-53.

7 CA Decision, p. 10; Rollo, p. 24.
587
VOL. 458, MAY 16, 2005 587
Art. 95. RIGHT TO SERVICE INCENTIVE LEAVE
(a) Every employee who has rendered at least one year of service shall be entitled to a yearly service
incentive leave of five days with pay.
Book III, Rule V: SERVICE INCENTIVE LEAVE
SECTION 1. Coverage.This rule shall apply to all employees except:
...
(d) Field personnel and other employees whose performance is unsupervised by the employer including those who
are engaged on task or contract basis, purely commission basis, or those who are paid in a fixed amount for
performing work irrespective of the time consumed in the performance thereof;
...
A careful perusal of said provisions of law will result in the

conclusion that the grant of service incentive leave has been
delimited by the Implementing Rules and Regulations of the
Labor Code to apply only to those employees not explicitly
excluded by Section 1 of Rule V. According to the
Implementing Rules, Service Incentive Leave shall not apply
to employees classified as field personnel. The phrase other
employees whose performance is unsupervised by the
employer must not be understood as a separate classification
of employees to which service incentive leave shall not be
granted. Rather, it serves as an amplification of the
interpretation of the definition of field personnel under the
Labor Code as those whose actual hours of work in the field
cannot be determined with reasonable certainty. 8
The same is true with respect to the phrase those who are
engaged on task or contract basis, purely commission basis.
Said phrase should be related with field personnel, applying
the rule on ejusdem generis that general and unlimited terms
are restrained and limited by the particular terms that they
_______________
8 See Mercidar Fishing Corporation v. National Labor Relations Commission, G.R. No. 112574, 08 October
1998, 297 SCRA 440.

588
follow. Hence, employees engaged on task or contract basis or
9
paid on purely commission basis are not automatically

exempted from the grant of service incentive leave, unless,
they fall under the classification of field personnel.
Therefore, petitioners contention that respondent is not
entitled to the grant of service incentive leave just because he
was paid on purely commission basis is misplaced. What must
be ascertained in order to resolve the issue of propriety of the
grant of service incentive leave to respondent is whether or
not he is a field personnel.
According to Article 82 of the Labor Code, field personnel
shall refer to non-agricultural employees who regularly
perform their duties away from the principal place of business
or branch office of the employer and whose actual hours of
work in the field cannot be determined with reasonable
certainty. This definition is further elaborated in the Bureau
of Working Conditions (BWC), Advisory Opinion to Philippine
Technical-Clerical Commercial Employees Association which 10
states that:
As a general rule, [field personnel] are those whose performance of their job/service is not supervised by
the employer or his representative, the workplace being away from the principal office and whose hours
and days of work cannot be determined with reasonable certainty; hence, they are paid specific amount
for rendering specific service or performing specific work. If required to be at specific places at specific
times, employees including drivers cannot be said to be field personnel despite the fact that they are
performing work away from the principal office of the employee. [Emphasis ours]
To this discussion by the BWC, the petitioner differs and
postulates that under said advisory opinion, no employee
would ever be considered a field personnel because every
_______________
9 Cebu Institute of Technology v. Ople, G.R. No. L- 58870, 18 December 1987, 156 SCRA 629, 672, citing Vera v.
Cuevas, G.R. No. L-33693, 31 May 1979, 90 SCRA 379.

10 06 April 1989; Rollo. p. 20.
589
VOL. 458, MAY 16, 2005 589
employer, in one way or another, exercises control over his
employees. Petitioner further argues that the only criterion
that should be considered is the nature of work of the
employee in that, if the employees job requires that he works
away from the principal office like that of a messenger or
a bus driver, then he is inevitably a field personnel.
We are not persuaded. At this point, it is necessary to
stress that the definition of a field personnel is not merely
concerned with the location where the employee regularly
performs his duties but also with the fact that the employees
performance is unsupervised by the employer. As discussed
above, field personnel are those who regularly perform their
duties away from the principal place of business of the
employer and whose actual hours of work in the field cannot
be determined with reasonable certainty. Thus, in order to
conclude whether an employee is a field employee, it is also
necessary to ascertain if actual hours of work in the field can
be determined with reasonable certainty by the employer. In
so doing, an inquiry must be made as to whether or not the
employees time and performance are constantly supervised
by the employer.
As observed by the Labor Arbiter and concurred in by the
Court of Appeals:
It is of judicial notice that along the routes that are plied by these bus companies, there are its
inspectors assigned at strategic places who board the bus and inspect the passengers, the punched
tickets, and the conductors reports. There is also the mandatory once-a-week car barn or shop day,
where the bus is regularly checked as to its mechanical, electrical, and hydraulic aspects, whether or
not there are problems thereon as reported by the driver and/or conductor. They too, must be at specific
place as [sic] specified time, as they generally observe prompt departure and arrival from their point of
origin to their point of destination. In each and every depot, there is always the Dispatcher whose
function is precisely to see to it that the bus and its crew leave the premises at specific times and
arrive at the estimated proper time. These, are present in the case at bar. The driver, the complainant
herein, was therefore
590
under constant supervision while in the performance of this work. He cannot be considered a field
personnel.11
We agree in the above disquisition. Therefore, as correctly

concluded by the appellate court, respondent is not a field
personnel but a regular employee who performs tasks usually
necessary and desirable to the usual trade of petitioners
business. Accordingly, respondent is entitled to the grant of
service incentive leave.
The question now that must be addressed is up to what
amount of service incentive leave pay respondent is entitled
to.
The response to this query inevitably leads us to the
correlative issue of whether or not the three (3)-year
prescriptive period under Article 291 of the Labor Code is
applicable to respondents claim of service incentive leave pay.
Article 291 of the Labor Code states that all money claims
arising from employer-employee relationship shall be filed
within three (3) years from the time the cause of action
accrued; otherwise, they shall be forever barred.
In the application of this section of the Labor Code, the
pivotal question to be answered is when does the cause of
action for money claims accrue in order to determine the
reckoning date of the three-year prescriptive period.
It is settled jurisprudence that a cause of action has three
elements, to wit, (1) a right in favor of the plaintiff by
whatever means and under whatever law it arises or is
created; (2) an obligation on the part of the named defendant
to respect or not to violate such right; and (3) an act or
omission on the part of such defendant violative of the right of
the plaintiff or constituting a breach of the obligation of the
defendant to the plaintiff. 12
_______________
11Rollo, pp. 45-46.

12Baliwag Transit, Inc. v. Ople, G.R. No. 57642, 16 March 1989, 171 SCRA 250, citing Agric. Credit &
Cooperative Financing
591
VOL. 458, MAY 16, 2005 591
To properly construe Article 291 of the Labor Code, it is
essential to ascertain the time when the third element of a
cause of action transpired. Stated differently, in the
computation of the three-year prescriptive period, a
determination must be made as to the period when the act
constituting a violation of the workers right to the benefits
being claimed was committed. For if the cause of action
accrued more than three (3) years before the filing of the
money claim, said cause of action has already prescribed in
accordance with Article 291. 13
Consequently, in cases of nonpayment of allowances and

other monetary benefits, if it is established that the benefits
being claimed have been withheld from the employee for a
period longer than three (3) years, the amount pertaining to
the period beyond the three-year prescriptive period is
therefore barred by prescription. The amount that can only be
demanded by the aggrieved employee shall be limited to the
amount of the benefits withheld within three (3) years before
the filing of the complaint. 14
It is essential at this point, however, to recognize that the

service incentive leave is a curious animal in relation to other
benefits granted by the law to every employee. In the case of
service incentive leave, the employee may choose to either
use his leave credits or commute it to its monetary equivalent
if not exhausted at the end of the year. Furthermore, if the 15
employee entitled to service incentive leave does not use or

_______________
Administration v. Alpha Ins. & Surety Co., Inc., G.R. No. L-24566, 29 July 1968, 24 SCRA 151; Summit
Guaranty and Insurance Co., Inc. v. De Guzman, G.R. No. L-50997, 30 June 1987, 151 SCRA 389; Tormon v.
Cutanda, G.R. No. L-18785, 23 December 1963, 9 SCRA 698.
13 See De Guzman, et al. v. Court of Appeals and Nasipit Lumber Co., G.R. No. 132257, 12 October 1998, 297
SCRA 743.
14 See E. Ganzon, Inc. v. National Labor Relations Commission, G.R. No. 123769, 22 December 1999, 321 SCRA
434.
15 Fernandez v. National Labor Relations Commission, G.R. No. 105892, 28 January 1998, 349 Phil 65; 285
SCRA 149.
592
commute the same, he is entitled upon his resignation or
separation from work to the commutation of his accrued
service incentive leave. As enunciated by the Court
in Fernandez v. NLRC: 16
The clear policy of the Labor Code is to grant service incentive leave pay to workers in all
establishments, subject to a few exceptions. Section 2, Rule V, Book III of the Implementing Rules and
Regulations provides that [e]very employee who has rendered at least one year of service shall be
entitled to a yearly service incentive leave of five days with pay. Service incentive leave is a right
which accrues to every employee who has served within 12 months, whether continuous or broken
reckoned from the date the employee started working, including authorized absences and paid regular
holidays unless the working days in the establishment as a matter of practice or policy, or that
provided in the employment contracts, is less than 12 months, in which case said period shall be
considered as one year. It is also commutable to its money equivalent if not used or exhausted at the
end of the year. In other words, an employee who has served for one year is entitled to it. He may use it
as leave days or he may collect its monetary value. To limit the award to three years, as the solicitor
general recommends, is to unduly restrict such right. [Italics supplied]
17
Correspondingly, it can be conscientiously deduced that the

cause of action of an entitled employee to claim his service
incentive leave pay accrues from the moment the employer
refuses to remunerate its monetary equivalent if the
employee did not make use of said leave credits but instead
chose to avail of its commutation. Accordingly, if the employee
wishes to accumulate his leave credits and opts for its
commutation upon his resignation or separation from
employment, his cause of action to claim the whole amount of
his accumulated service incentive leave shall arise when the
employer fails to pay such amount at the time of his
resignation or separation from employment.
_______________
16 Ibid.
17 Ibid., pp. 94-95.
593
VOL. 458, MAY 16, 2005 593
Applying Article 291 of the Labor Code in light of this
peculiarity of the service incentive leave, we can conclude that
the three (3)-year prescriptive period commences, not at the
end of the year when the employee becomes entitled to the
commutation of his service incentive leave, but from the time
when the employer refuses to pay its monetary equivalent
after demand of commutation or upon termination of the
employees services, as the case may be.
The above construal of Art. 291, vis--vis the rules on
service incentive leave, is in keeping with the rudimentary
principle that in the implementation and interpretation of the
provisions of the Labor Code and its implementing
regulations, the workingmans welfare should be the
primordial and paramount consideration. The policy is to 18
extend the applicability of the decree to a greater number of

employees who can avail of the benefits under the law, which
is in consonance with the avowed policy of the State to give
maximum aid and protection to labor. 19
In the case at bar, respondent had not made use of his

service incentive leave nor demanded for its commutation
until his employment was terminated by petitioner. Neither
did petitioner compensate his accumulated service incentive
leave pay at the time of his dismissal. It was only upon his
filing of a complaint for illegal dismissal, one month from the
time of his dismissal, that respondent demanded from his
former employer commutation of his accumulated leave
credits. His cause of action to claim the payment of his
accumulated ser-
_______________
18 Abella v. National Labor Relations Commission, G.R. No. L-71813, 20 July 1987, 152 SCRA 140,
citing Volkschel Labor Union v. Bureau of Labor Relations, G.R. No. L-45824, 19 June 1985, 137 SCRA 43.
19 Sarmiento v. Employees Compensation Commission, G.R. No. L-68648, 24 September 1986, 144 SCRA 421,
citing Cristobal v. Employees Compensation Commission, G.R. No. L-49280, 26 Febru-ary 1981, 103 SCRA
329; Acosta v. Employees Compensation Commission, G.R. No. L-55464, 12 November 1981, 109 SCRA 209.
594
vice incentive leave thus accrued from the time when his
employer dismissed him and failed to pay his accumulated
leave credits.
Therefore, the prescriptive period with respect to his claim
for service incentive leave pay only commenced from the time
the employer failed to compensate his accumulated service
incentive leave pay at the time of his dismissal. Since
respondent had filed his money claim after only one month
from the time of his dismissal, necessarily, his money claim
was filed within the prescriptive period provided for by Article
291 of the Labor Code.
WHEREFORE, premises considered, the instant petition is
hereby DENIED. The assailed Decision of the Court of
Appeals in CA-G.R. SP. No. 68395 is hereby
AFFIRMED. No Costs.
SO ORDERED.
Puno (Chairman), Austria-Martinez, Callejo,
Sr. and Tinga, JJ., concur.
Petition denied, assailed decision affirmed.
Notes.Although fishermen perform non-agricultural
work away from their employers business offices, the fact
remains that throughout the duration of their work they are
under the effective control and supervision of the employer
through the vessels patron or master. (Mercidar Fishing
Corporation vs. National Labor Relations Commission, 297
SCRA 440 [1998])
Piece-rate employees are not entitled to service incentive
leave pay as well as holiday pay even if they are entitled to
other benefits like COLA and 13th month pay. (Mark Roche
International vs. National Labor Relations Commission, 313
SCRA 356 [1999])
o0o
San Juan De Dios Hospital Employees Association-AFW vs. National

Labor Relations Commission
G.R. No. 126383. November 28, 1997. *
SAN JUAN DE DIOS HOSPITALEMPLOYEES ASSOCIA

TION-AFW/MA. CONSUELO MAQUILING, LEONARDO
MARTINEZ, DOMINGO ELA, JR., RODOLFO CALUCIN,
JR., PERLA MENDOZA, REX RAPHAEL REYES, ROGELIO
BELMONTE, AND 375 OTHER EMPLOYEE-UNION
MEMBERS,
petitioners, vs. NATIONALLABOR RELATIONS COMMIS
SION and SAN JUAN DE DIOS HOSPITAL, respondents.
Labor Law; Labor Code; Reliance on Republic Act No. 5901 is
misplaced for the said statute has long been repealed with the
passage of the Labor Code on May 1, 1974.We note that Policy
Instruction No. 54 relies and purports to implement Republic Act
No. 5901, otherwise known as An Act Prescribing Forty Hours A
Week Of Labor For Government and Private Hospitals Or Clinic
Personnel, enacted on June 21, 1969. Reliance on Republic Act No.
5901, however, is misplaced for the said statute, as correctly ruled by
respondent NLRC, has long been repealed with the passage of the
Labor Code on May 1, 1974, Article 302 of which explicitly provides:
All labor laws not adopted as part of this Code either directly or by
reference are hereby repealed. All provisions of existing laws, orders,
decrees, rules and regulations inconsistent herewith are likewise
repealed. Accordingly, only Article 83 of the Labor Code which
appears to have substantially incorporated or reproduced the basic
provisions of Republic Act No. 5901 may support Policy Instructions
No. 54 on which the latters validity may be gauged.
______________
* THIRD DIVISION.
317
VOL. 282, NOVEMBER 28, 1997 31
7
San Juan De Dios Hospital Employees Association-AFW vs.
National Labor Relations Commission
Same; Same; The Secretary of Labor exceeded his authority by
including a two days off with pay in contravention of the clear
mandate of the statute.A cursory reading of Article 83 of the Labor
Code betrays petitioners position that hospital employees are
entitled to a full weekly salary with paid two (2) days off if they
have completed the 40-hour/5-day workweek. What Article 83
merely provides are: (1) the regular office hour of eight hours a day,
five days per week for health personnel, and (2) where the exigencies
of service require that health personnel work for six days or forty-
eight hours then such health personnel shall be entitled to an
additional compensation of at least thirty percent of their regular
wage for work on the sixth day. There is nothing in the law that
supports then Secretary of Labors assertion that personnel in
subject hospitals and clinics are entitled to a full weekly wage for
seven (7) days if they have completed the 40-hour/5-day workweek in
any given workweek. Needless to say, the Secretary of Labor
exceeded his authority by including a two days off with pay in
contravention of the clear mandate of the statute. Such act the Court
shall not countenance. Administrative interpretation of the law, we
reiterate, is at best merely advisory, and the Court will not hesitate
to strike down an administrative interpretation that deviates from
the provision of the statute.
Same; Same; Court finds Policy Instructions No. 54 invalid.
Indeed, even if we were to subscribe with petitioners erroneous
assertion that Republic Act No. 5901 has neither been amended nor
repealed by the Labor Code, we nevertheless find Policy Instructions
No. 54 invalid. A perusal of Republic Act No. 5901 reveals nothing
therein that gives two days off with pay for health personnel who
complete a 40-hour work or 5-day workweek. In fact, the
Explanatory Note of House Bill No. 16630 (later passed into law as
Republic Act No. 5901) explicitly states that the bills sole purpose is
to shorten the working hours of health personnel and not to dole out
a two days off with pay.
Same; Same; Policy Instructions No. 54 being inconsistent with
and repugnant to the provision of Article 83 of the Labor Code, as
well as to Republic Act No. 5901, should be, as it is hereby, declared
void.Policy Instructions No. 54 to our mind unduly extended the
statute. The Secretary of Labor moreover erred in invoking the
spirit and intent of Republic Act No. 5901 and Article 83 of the
Labor Code for it is an elementary rule of statutory construction
318
18
San Juan De Dios Hospital Employees Association-AFW vs.
National Labor Relations Commission
that when the language of the law is clear and unequivocal, the
law must be taken to mean exactly what it says. No additions or
revisions may be permitted. Policy Instructions No. 54 being
inconsistent with and repugnant to the provision of Article 83 of the
Labor Code, as well as to Republic Act No. 5901, should be, as it is
hereby, declared void.
SPECIAL CIVIL ACTION in the Supreme Court. Certiorari.

Edgar R. Martir for petitioners.
Padilla Law Office for private respondent.
Quiason, Makalintal, Barot, Torres & Ibarra for St.
Anthony College.
FRANCISCO, J.:
Petitioners, the rank-and-file employee-union officers and

members
of San Juan De DiosHospital Employees Association, sent
on July 08, 1991, a four (4)-page letter with attached support
signatures x x x requesting and pleading for the expeditious
implementation and payment by
respondent Juan De DiosHospital of the 40-HOURS/5-
DAY WORK-WEEK with compensable weekly two (2) days
off provided for by Republic Act 5901 as clarified for
enforcement by the Secretary of Labors Policy
Instructions No. 54 dated April 12,
1988. Respondent hospital failed to give a favorable
1
response; thus, petitioners filed a complaint regarding their
claims for statutory benefits under the above-cited law and
policy issuance, docketed as NLRC NCR Case No. 00-08-
2
04815-91. On February 26, 1992,

the Labor Arbiter dismissed the complaint. Petitioners
3
appealed before public respondent

________________
1 Petition, p. 4; Rollo, p. 9.
2 Id.
3 Labor Arbiter Edilberto Pangan.
319
VOL. 282, NOVEMBER 28, 1997 319
National Labor Relations Commission (NLRC), docketed 4
as NLRC NCR CA 003028-92, which affirmed

the Labor Arbiters decision. Petitioners subsequent motion
for reconsideration was denied; hence, this petition under
Rule 65 of the Rules of Court ascribing grave abuse of
discretion on the part of NLRC in concluding that Policy
Instructions No. 54 proceeds from a wrong interpretation of
RA 5901 and Article 83 of the Labor Code.
5
As the Court sees it, the core issue is whether Policy

Instructions No. 54 issued by then Labor Secretary (now
Senator) Franklin M. Drilon is valid or not.
The policy instruction in question provides in full as
follows:
Policy Instruction No. 54
To: All Concerned
Subject: Working Hours and Compensation ofHospital/Clinic
Personnel.
This issuance clarifies the enforcement policy of this Department on the working hours and
compensation of personnel employed by hospital/clinics with a bed capacity of 100 or more and those
located in cities and municipalities with a population of one million or more.
Republic Act 5901 took effect on 21 June 1969 prescribes a 40-hour/5 day work week
for hospital/clinic personnel. At the same time, the Act prohibits the diminution of the compensation of
these workers who would suffer a reduction in their weekly wage by reason of the shortened workweek
prescribed by the Act. In effect, RA 5901 requires that the covered hospital workers who used to work
seven (7) days a week should be paid for such number of days for working only 5 days or 40 hours a
week.
The evident intention of RA 5901 is to reduce the number of hospital personnel, considering the
nature of their work, and at the same time guarantee the payment to them of a full weekly wage for
_________________
4
Second Division: Calaycay, V.R., Comm., Ponente; Aquino, R.T., Pres. Comm.; and Rayala, R.I., Comm., Concurring.
5
NLRC Decision, p. 18; Rollo, p. 70.
320
seven (7) days. This is quite clear in the Exemplary Note of RA 5901 which states:
As compared with the other employees and laborers, these hospital and health clinic personnel are over-worked
despite the fact that their duties are more delicate in nature. If we offer them better working conditions, it is
believed that the brain drain, that our country suffers nowadays as far as these personnel are concerned will be
considerably lessened. The fact that these hospitals and health clinics personnel perform duties which are directly
concerned with the health and lives of our people does not mean that they should work for a longer period than most
employees and laborers. They are also entitled to as much rest as other workers. Making them work longer than is
necessary may endanger, rather than protect the health of their patients. Besides, they are not receiving better pay
than the other workers. Therefore, it is just and fair that they may be made to enjoy the privileges of equal working
hours with other workers except those excepted by law. (Sixth Congress of the Republic of the Philippines, Third
Session, House of Representatives, H. No. 16630)
The Labor Code in its Article 83 adopts and incorporates the basic provisions of RA 5901 and
retains its spirit and intent which is to shorten the workweek of covered hospital personnel and at the
same time assure them of a full weekly wage.
Consistent with such spirit and intent, it is the position of the Department that personnel in
subject hospital and clinics are entitled to a full weekly wage for seven (7) days if they have completed
the 40-hour/5-day workweek in any given workweek.
All enforcement and adjudicatory agencies of this Department shall be guided by this issuance in
the disposition of cases involving the personnel of covered hospitals and clinics.
Done in the City of Manila, this 12th day of April, 1988.
(Sgd.) FRANKLIN M. DRILON
Secretary
(Emphasis Added)
We note that Policy Instruction No. 54 relies and purports to
implement Republic Act No. 5901, otherwise known as An
321
VOL. 282, NOVEMBER 28, 1997 321
Act Prescribing Forty Hours A Week Of Labor For
Government and Private Hospitals Or Clinic Personnel,
enacted on June 21, 1969. Reliance on Republic Act No. 5901,
however, is misplaced for the said statute, as correctly ruled
by respondent NLRC, has long been repealed with the
passage of the Labor Code on May 1, 1974, Article 302 of
which explicitly provides: All labor laws not adopted as part
of this Code either directly or by reference are hereby
repealed. All provisions of existing laws, orders, decrees, rules
and regulations inconsistent herewith are likewise repealed.
Accordingly, only Article 83 of the Labor Code which appears
to have substantially incorporated or reproduced the basic
provisions of Republic Act No. 5901 may support Policy
Instructions No. 54 on which the latters validity may be
gauged. Article 83 of the Labor Code states:
Art. 83. Normal Hours of Work.The normal hours of work of any employee shall not exceed eight (8)
hours a day.
Health personnel in cities and municipalities with a population of at least one million (1,000,000)
or in hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office
hours for eight (8) hours a day, for five (5) days a week, exclusive of time for meals, except where the
exigencies of the service require that such personnel work for six (6) days or forty-eight (48) hours, in
which case they shall be entitled to an additional compensation of at least thirty per cent (30%) of their
regular wage for work on the sixth day. For purposes of this Article, health personnel shall include:
resident physicians, nurses, nutritionists, dietitians, pharmacists, social workers, laboratory
technicians, paramedical technicians, psychologists, midwives, attendants and all other hospital or
clinic personnel. (Italics supplied)
A cursory reading of Article 83 of the Labor Code betrays
petitioners position that hospital employees are entitled to
a full weekly salary with paid two (2) days off if they have
completed the 40-hour/5-day workweek. What Article 83 6
merely provides are: (1) the regular office hour of eight hours
________________
6 Petition, p. 14; Rollo, p. 19.

322
a day, five days per week for health personnel, and (2) where
the exigencies of service require that health personnel work
for six days or forty-eight hours then such health personnel
shall be entitled to an additional compensation of at least
thirty percent of their regular wage for work on the sixth day.
There is nothing in the law that supports then Secretary of
Labors assertion that personnel in subject hospitals and
clinics are entitled to a full weekly wage for seven (7) days if
they have completed the 40-hour/5-day workweek in any
given workweek. Needless to say, the Secretary of Labor
exceeded his authority by including a two days off with pay in
contravention of the clear mandate of the statute. Such act
the Court shall not countenance. Administrative
interpretation of the law, we reiterate, is at best merely
advisory, and the Court will not hesitate to strike down an
7
administrative interpretation that deviates from the provision

of the statute.
Indeed, even if we were to subscribe with petitioners
erroneous assertion that Republic Act No. 5901 has neither
been amended nor repealed by the Labor Code, we
nevertheless find Policy Instructions No. 54 invalid. A perusal
of Republic Act No. 5901 reveals nothing therein that gives
8
two days off

_______________
7 Philippine Apparel Workers Union v. NLRC, 106 SCRA 444, 464

8 Pertinent provisions of Republic Act No. 5901 provides as follows:
AN ACT PRESCRIBING FORTY HOURS A WEEK OF LABOR FOR GOVERNMENT AND PRIVATE
HOSPITALS OR CLINIC PERSONNEL
Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled
Section 1. Government and private resident physicians, nurses, nutritionists, dietetians (sic), pharmacists,
social workers, laboratory technicians, psychologists, midwives, attendants and all other hospitals or clinic
personnel shall hold regular office hours for eight hours a day, for five days a week, or a total of forty hours a week,
exclusive of time for lunch: Provided, That any of such employees or laborers who shall suffer a reduction of his
weekly or daily wage or compensation because of a reduction of the number of days or hours of labor in a week, as
provided, herein, subject to the minimum
323
VOL. 282, NOVEMBER 28, 1997 323
with pay for health personnel who complete a 40-hour work or
5-day workweek. In fact, the Explanatory Note of House Bill
No. 16630 (later passed into law as Republic Act No. 5901)
explicitly states that the bills sole purpose is to shorten the
working hours of health personnel and not to dole out a two
days off with pay.
Hence:
The accompanying bill seeks to grant resident physicians, staff nurses, nutritionists, midwives,
attendants and other hospital and health clinic personnel of public and private hospitals and
clinics, the privilege of enjoying the eight hours a week exclusive of time for lunch granted by law to all
government employees and workers except those employed in schools and in courts. At present those
hospitals and health clinic personnel including those employed in private hospitals and clinics, work six
days a week, 8 hours a day or 48 hours a week.
As compared with the other employees and laborers, these hospital and health clinic personnel are
over-worked despite the fact that their duties are more delicate in nature. If we offer them better
working conditions, it is believed that the brain drain, that our country suffers nowadays as far as
these personnel are concerned will be considerably lessened. The fact that these hospitals and health
clinic personnel perform duties which are directly concerned with the health and lives of our people does
not mean that they should work for a longer period than most employees and laborers. They are also
entitled to as much rest as other workers. Making them work longer than is necessary may endanger,
rather than protect, the health of their patients. Besides, they are not receiving better pay than the
other workers. Therefore, it is just and fair that they be
________________
daily or hourly wage or compensation already fixed by existing law, shall be given an automatic increase in his daily or hourly or
per piece wage shall be equal to the diminution which his daily or hourly or per piece wage shall suffer on account of the reduction of
days of labor to five days a week. And provided further, That the salaries of employees received on monthly basis shall not suffer any
diminution on account of the reduction of the number of days of labor a week.
Sec. 2. This Act shall apply only to cities and municipalities with a population of one million or more and to hospitals and
clinics with a bed capacity of at least one hundred. (Emphasis added).
324
made to enjoy the privileges of equal working hours with other workers except those excepted by law.
In the light of the foregoing, approval of this bill is strongly recommended.
(SGD.) SERGIO H. LOYOLA
Congressman, 3rd District
Manila (Annex F of petition,
italics supplied)
Further, petitioners position is also negated by the very rules
and regulations promulgated by the Bureau of Labor
Standards which implement Republic Act No. 5901. Pertinent
portions of the implementing rules provide:
RULES AND REGULATIONS IMPLEMENTING
REPUBLIC ACT NO. 5901
By virtue of Section 79 of the Revised Administrative Code, as modified by section 18 of

Implementation Report for Reorganization Plan No. 20-A on Labor, vesting in the Bureau of Labor
Standards the authority to promulgate rules and regulations to implement wage and hour laws, the
following rules and regulations are hereby issued for the implementation of Republic Act No. 5901.
CHAPTER ICoverage
Section 1. General Statement on Coverage.Republic Act No. 5901, hereinafter referred to as the
Act, shall apply to:
1. (a)All hospitals and clinics, including those with a bed capacity of less than one hundred,
which are situated in cities or municipalities with a population of one million or more; and to
2. (b)All hospitals and clinics with a bed capacity of at least one hundred, irrespective of the size
of population of the city or municipality where they may be situated.
xxx xxx xxx

Section 7. Regular Working Day.The regular working days of covered employees shall be not
more than five days in a work-
325
VOL. 282, NOVEMBER 28, 1997 325
week. The workweek may begin at any hour and on any day, including Saturday or Sunday, designated
by the employer.
Employers are not precluded from changing the time at which the workday or workweek begins,
provided that the change is not intended to evade the requirements of these regulations on the
payment of additional compensation.
xxx xxx xxx
Section 15. Additional Pay Under the Act and C.A. No. 444.(a) Employees of covered hospitals
and clinics who are entitled to the benefits provided under the Eight-Hour Labor Law, as amended,
shall be paid an additional compensation equivalent to their regular rate plus at least twenty-five
percent thereof for work performed on Sunday and Holidays, not exceeding eight hours, such employees
shall be entitled to an additional compensation of at least 25% of their regular rate.
1. (b)For work performed in excess of forty hours a week, excluding those rendered in excess of
eight hours a day during the week, employees covered by the Eight-Hour Labor Law shall be
entitled to an additional straight-time pay which must be equivalent at least to their regular
rate.
If petitioners are entitled to two days off with pay, then there
appears to be no sense at all why Section 15 of the
implementing rules grants additional compensation
equivalent to the regular rate plus at least twenty-five
percent thereof for work performed on Sunday to health
personnel, or an additional straight-time pay which must be
equivalent at least to the regular rate [f]or work performed
in excess of forty hours a week x x x. Policy Instructions No.
54 to our mind unduly extended the statute. The Secretary of
Labor moreover erred in invoking the spirit and intent of
Republic Act No. 5901 and Article 83 of the Labor Code for it
is an elementary rule of statutory construction that when the
language of the law is clear and unequivocal, the law must be
taken to mean exactly what it says. No additions or revisions 9
may be permitted. Policy Instructions No. 54 being inconsis-

_________________
9 Insular Bank of Asia and America Employees Union v. Inciong, 132 SCRA 663, 673.
326
Manuel vs. N.C. Construction Supply
tent with and repugnant to the provision of Article 83 of the
Labor Code, as well as to Republic Act No. 5901, should be, as
it is hereby, declared void.
WHEREFORE, the decision appealed from is AFFIRMED.
No costs.
SO ORDERED.
Narvasa (C.J.,
Chairman), Romero, Melo and Panganiban, JJ., concur.
Appealed decision affirmed.
o0o

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National Sugar Refineries Corporation vs.

NATIONAL SUGAR REFINERIESCORPORATION,

The main issue presented for resolution in this original

2 Annex E, Petition; Rollo, 51, 56-57.

All other claims are hereby dismissed for lack of merit.

decision was denied in a resolution of public respondent dated

concurrence of Comm. Ireneo B. Bernardo and Rogelio I. Rayala.

1. (b)Managerial employees, if they meet all of the

1. (1)Their primary duty consists of the management of

1. (c)Officers or members of a managerial staff if they

1. (1)The primary duty consists of the performance of

1. (2)Customarily and regularly exercise discretion and

It is the submission of petitioner that while the members of

Consequently, while generally this Court is not supposed to

these supervisory employees are under the direct supervision

1. 1)assists the department superintendent in the

1. a)planning of systems and procedures relative to

5 Sosito vs. Aguinaldo Development Corporation, 156 SCRA 392 (1987).

1. giving his full support;

1. 2)observes, follows and implements company policies at

From the foregoing, it is apparent that the members of

respondent commission in NLRC Case No. CA No. I-

8 Annex G, Petition; Rollo, 72.

It bears mention that this positional submission was never

The test or rationale of this rule on long practice requires

case at bar, respondent union failed to sufficiently establish

1. B.It remains undisputed that with the implementation

1. re-classified under levels S-5 to S-8 which were

Quintessentially, with the promotion of the union members,

Auto Bus Transport Systems, Inc. vs. Bautista

AUTO BUS TRANSPORT SYSTEMS, INC.,

PETITION for review on certiorari of the decision and

The facts are stated in the opinion of the Court.

Before Us is a Petition for Review on Certiorariassailing the

the Decision of the National Labor Relations Commission

(NLRC). The NLRC ruling modified the Decision of the Labor

Justices Conrado M. Vasquez, Jr. and Mario L. Guaria, III, concurring.

portion of which reads:

4 NLRC Case No. RAB-CAR-02-0088-00.

Not satisfied with the decision of the Labor Arbiter, petitioner

5 Rollo, pp. 46-47.

In other words, the award of service incentive leave pay was

Hence, the instant petition.

1. 1.Whether or not respondent is entitled to service

6 Rollo, pp. 52-53.

A careful perusal of said provisions of law will result in the

1998, 297 SCRA 440.

paid on purely commission basis are not automatically

Cuevas, G.R. No. L-33693, 31 May 1979, 90 SCRA 379.

We agree in the above disquisition. Therefore, as correctly

11Rollo, pp. 45-46.

Consequently, in cases of nonpayment of allowances and

It is essential at this point, however, to recognize that the

employee entitled to service incentive leave does not use or

Correspondingly, it can be conscientiously deduced that the

extend the applicability of the decree to a greater number of

In the case at bar, respondent had not made use of his

San Juan De Dios Hospital Employees Association-AFW vs. National

SAN JUAN DE DIOS HOSPITALEMPLOYEES ASSOCIA

SPECIAL CIVIL ACTION in the Supreme Court. Certiorari.

The facts are stated in the opinion of the Court.

Petitioners, the rank-and-file employee-union officers and

04815-91. On February 26, 1992,

appealed before public respondent