TSPI, INCORPORATION VS.

TSPIC EMPLOYEES UNION Case Digest

TSPI, INCORPORATION VS. TSPIC EMPLOYEES UNION

G.R No. 163419. February 13, 2008

FACTS: TSPI Corporation entered into a Collective Bargaining Agreement with the corporation
Union for the increase of salary for the latters members for the year 2000 to 2002 starting from
January 2000. thus, the increased in salary was materialized on January 1, 2000. However, on
October 6, 2000, the Regional Tripartite Wage and production Board raised daily minimum wage
from P 223.50 to P 250.00 starting November 1, 2000. Conformably, the wages of the 17
probationary employees were increased to P250.00 and became regular employees therefore
receiving another 10% increase in salary. In January 2001, TSPIC implemented the new wage rates
as mandated by the CBA. As a result, the nine employees who were senior to the 17 recently
regularized employees, received less wages. On January 19, 2001, TSPICs HRD notified the 24
employees who are private respondents, that due to an error in the automated payroll system, they
were overpaid and the overpayment would be deducted from their salaries starting February 2001.
The Union on the other hand, asserted that there was no error and the deduction of the alleged
overpayment constituted diminution of pay.

ISSUE: Whether the alleged overpayment constitutes diminution of pay as alleged by the Union.

RULING: Yes, because it is considered that Collective Bargaining Agreement entered into by unions
and their employers are binding upon the parties and be acted in strict compliance therewith. Thus,
the CBA in this case is the law between the employers and their employees.

Therefore, there was no overpayment when there was an increase of salary for the members of the
union simultaneous with the increasing of minimum wage for workers in the National Capital Region.
The CBA should be followed thus, the senior employees who were first promoted as regular
employees shall be entitled for the increase in their salaries and the same with lower rank workers.