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1.) MANILA TERMINAL COMPANY, INC., petitioner, vs.

THE COURT OF INDUSTRIAL RELATIONS and MANILA TERMINAL AUTHOR: PELAYO


RELIEF AND MUTUAL AID ASSOCIATION, respondents. NOTES:
PONENTE: PARAS, C. J. TOPIC: Regulation; rationale
Doctrine: The public is interested in the strict enforcement of the Eight Hour Labor Law. This was designed not only to safeguard the health and welfare of the
laborer or employee, but in a way to minimize unemployment by forcing employers, in cases where more than 8 hour operation is necessary, to utilize different
shifts of laborers or employees working only for 8 hour each.
FACTS:
Manila Terminal Company, Inc. hereinafter to be referred as to the petitioner, undertook the arrastre service in some of the piers in Manilas Port Area at the
request and under the control of the United States Army.
The petitioner hired some thirty men as watchmen on twelve-hour shifts at a compensation of P3 per day for the day shift and P6 per day for the night shift.
The watchmen of the petitioner continued in the service with several substitutions and additions, their salaries having been raised during the month of
February to P4 per day for the day shift and P6.25 per day for the nightshift.
The private respondent sent a letter to Department of Labor requesting that the matter of overtime pay be investigated. But nothing was done by the Dept.
of Labor.
Later, the petitioner instituted the system of strict eight-hour shifts.
The private respondent filed an amended petition with the Court of Industrial Relations praying, among others, that the petitioner be ordered to pay its
watchmen or police force overtime pay from the commencement of their employment.
By Customs Administrative Order No. 81 and Executive Order No. 228 of the President of the Philippines, the entire police force of the petitioner was
consolidated with the Manila Harvor Police of the Customs Patrol Service, a Government agency under the exclusive control of the Commissioner of Customs
and the Secretary of Finance the Manila Terminal Relief and Mutual Aid Association will hereafter be referred to as the Association.
Judge V. Jimenez Yanson of the Court of Industrial Relations in his decision ordered the petitioner to pay to its police force but regards to overtime service
after the watchmen had been integrated into the Manila Harbor Police, the has no jurisdiction because it affects the Bureau of Customs, an instrumentality of
the Government having no independent personality and which cannot be sued without the consent of the State.
The petitioner filed a motion for reconsideration. The Association also filed a motion for reconsideration in so far its other demands were dismissed. Both
resolutions were denied.
The public respondent decision was to pay the private respondents their overtime on regular days at the regular rate and additional number of 25 percent,
overtime on Sundays and legal holidays at the regular rate only, and watchmen are not entitled to night differential pay for past services.
The petitioner has filed a present petition for certiorari.
ISSUE(S): WON the agreement under which its police force was paid certain specific wages for 12 hour shifts, includes the overtime compensation?
HELD: NO.
The Court ruled that in times of acute employment, regardless of its terms and conditions, their main concern in the first place being admission to some work.
The petitioners watchmen must have railroaded themselves into their employment for their subsistence, although they found themselves required to work
for 12 hours a day. True, there was agreement to work, but it cannot fairly be supposed that they had the freedom to bargain in any way, much less to insist
in the observance of the 8 hour labor law.
Also, there was no reduction was made in the salaries which its watchmen received under the 12 hour arrangement. Although, it may be argued that the salary
for the night shift was lessened, the fact that the rate for the day shift was increased in a sense tends to militate against the contention that the salaries given
during the 12 hour shifts included overtime compensation.
The law gives the Association the right to extra compensation. And they could not be held to have impliedly waived such extra compensation, for the obvious
reason that could not have expressly waived it.
It is high time that all employers were warned that the public is interested in the strict enforcement of the Eight Hour Labor Law. This was designed not only
to safeguard the health and welfare of the laborer or employee, but in a way to minimize unemployment by forcing employers, in cases where more than 8
hour operation is necessary, to utilize different shifts of laborers or employees working only for 8 hour each.
The appealed decision, in the form voted by Judge Lanting, is affirmed, it being understood that the petitioners watchmen will be entitled to extra
compensation only from the dates they respectively entered the service of the petitioner.

02 SAN MIGUEL CORPORATION V LAYOC, JR. [G.R. No. 149640 October 19, 2007] AUTHOR: PAGCALIWAGAN
TOPIC: Hours of Work PONENTE: Carpio, J. NOTES:
CASE LAW/ DOCTRINE:

FACTS:
Respondents were among the Supervisory Security Guards of the Beer Division of the San Miguel Corporation (SMC)
They started working as guards with SMC assigned to the Beer Division on different dates until such time that they were promoted as
supervising security guards
Respondents were required to punch their time cards for purposes of determining the time they would come in and out of the companys work place
Respondents were availing the benefits for overtime, holiday and night premium duty through time card punching
In the early 1900s, SMC embarked on a Decentralization Program aimed at enabling the separate divisions of the SMC to pursue a more efficient and
effective management of their respective operations.
As a result, the Beer Division of SMC implemented a no time card policy whereby the Supervisory I and II composing of supervising security
guards of the Beer Division were no longer required to punch their time cards.
Consequently, without prior consultation with the respondents, the time cards were ordered confiscated and the latter were no longer allowed
to render overtime work.
However, in lieu of the overtime pay and the premium pay, the personnel of the Beer Division of SMC affected by the No Time Card Policy were given a
10% across-the-board increase on their basic pay while the supervisors who were assigned in the night shift (6pm-6am) were given night shift allowance
ranging from P2K to P2.5K.
Respondents filed a complaint for:
Unfair labor practice,
Violation of Article 100 of the Labor Code
Violation of the equal protection clause and due process of law in relation to paragraphs 6 & 8 of Article 32 of NCC
Prayed for actual damages for 2 years, moral damages, exemplary damages, and overtime, holiday, and night premium pay.

Respondents:
The Beer Division of SMC maliciously and fraudulently refused payment of their overtime, holiday, and night premium pay from 1 to 15 January 1993 because of
the no time card policy. SMC had no written authority to stop respondents from punching their time cards because the alleged memorandum authorizing such
stoppage did not include supervisory security guards. Thus, the respondents suffered a diminution of benefits, making petitioners liable for non-payment of
overtime, holiday, and night premium pay.

Petitioner:
Respondents were supervisory security guards who were exempt from the provisions of the Labor Code on hours of work, weekly rest periods, and rest days. The
no time card policy did not just prevent respondents from punching their time cards, but it also granted respondents an across-the-board increase of 10% of basic
salary and either a P2,000 or P2,500 night shift allowance on top of their yearly merit increase. Petitioners further asserted that the no time card policy was a valid
exercise of management prerogative and that all supervisors in the Beer Division were covered by the no time card policy, which classification was distinct and
separate from the other divisions within SMC.
Labor Arbiter: Arbiter stated that facts and evidence are in respondents favor. He ruled that rendering services beyond the regular 8-hour work day has become
company practice. SMC failed to show good faith in the exercise of their management prerogative in altering company practice because SMC changed the terms
and conditions of employment from hours of work rendered to result only with respect to respondents and not with other supervisors in other departments.

NLRC: Affirmed with modification LAs ruling that respondents suffered a diminution of benefits as a result of the adoption of the no time card policy. It cited a
well-established rule that employees have a vested right over existing benefits voluntarily granted to them by their employer, who may not unilaterally withdraw,
eliminate, or diminish such benefits. Here, there was a company practice which allowed the enjoyment of substantial additional remuneration. There is no rule
excluding managerial employees from the coverage of the principle of non-diminution of benefits. Decision is affirmed, but deleting award of moral and
exemplary damages.

CA: Set aside NLRCs ruling and rendered new decision in favor of respondents. While the implementation of the no time card policy was a valid exercise of
management prerogative, the rendering of overtime work by respondents was a long-accepted practice in SMC which could not be peremptorily withdrawn
without running afoul with the principles of justice and equity.
ISSUE(S): WON respondents are entitled to render overtime work and receive overtime pay despite the institution of the no time card policy.
HELD: NO.
Article 82 of the Labor Code states that the provisions of the Labor Code on working conditions and rest periods shall not apply to managerial employees. It is thus
clear that, generally, managerial employees such as respondents are not entitled to overtime pay for services rendered in excess of eight hours a
day. Respondents failed to show that the circumstances of the present case constitute an exception to this general rule.

On the assertion that Article 100 of the LC prohibits elimination or diminution of benefits:
Petitioners did not freely give the payment for overtime work to respondents. Petitioners paid respondents overtime pay as compensation for services rendered
in addition to the regular work hours. Respondents rendered overtime work only when their services were needed after their regular working hours and only
upon the instructions of their superiors. Respondents even differ as to the amount of overtime pay received on account of the difference in the additional hours
of services rendered.

Petitioners did not freely give the payment for overtime work to respondents. Petitioners paid respondents overtime pay as compensation for services rendered
in addition to the regular work hours. Respondents rendered overtime work only when their services were needed after their regular working hours and only
upon the instructions of their superiors. Respondents even differ as to the amount of overtime pay received on account of the difference in the additional hours
of services rendered.

On the assertion that petitioners discriminated them:


The Beer Division merely exercised its management prerogative of treating its supervisors differently from its rank-and-file employees, both as to responsibilities
and compensation, as they are not similarly situated.

The no time card policy affecting all of the supervisory employees of the Beer Division is a valid exercise of management prerogative. The no time card policy
undoubtedly caused pecuniary loss to respondents. However, petitioners granted to respondents and other supervisory employees a 10% across-the-board
increase in pay and night shift allowance, in addition to their yearly merit increase in basic salary, to cushion the impact of the loss. So long as a companys
management prerogatives are exercised in good faith for the advancement of the employers interest and not for the purpose of defeating or circumventing the
rights of the employees under special laws or under valid agreements, this Court will uphold them.

NAWASA v. NAWASA Consolidated Unions, Centeno [G.R. L-18939; August 31, 1964] AUTHOR: RAMOS
TOPIC: Hours of Work Exceptions Managerial Employees PONENTE: Bautista Angelo, J. NOTES: Issues 3 and 4 are the most relevant, I think
CASE LAW/ DOCTRINE: Managerial employees are persons whose primary duty consists of the management of the establishment or ally officer or member of the
managerial staff. They are NOT subject to the rigid observance of office hours. The value of their service is NOT measured by the time he spends in office but more
on the results he accomplishes. In fact, he is free to go out of office anytime.
FACTS:
President certified to the CIR a controversy between NAWASA and the unions involving the implementation of the 40-hour work week law (RA 1880), alleged
violations of the CBA concerning distress pay, minimum wage of P5.25, promotional appointments and filling of vacancies of newly created positions;
additional compensation for night work; wage increases to some laborers and employees; and strike duration pay. Unions also raised the issue of whether
the 25% additional compensation for Sunday work should be included in computing the daily wage and whether, in determining the daily wage of a monthly-
salaried employee, the salary should be divided by 30 days.
Centeno, et al. are intervenors for the issue on additional compensation for night work. Later they amended their petition by including a new demand for
overtime pay in favor of Jesus Centeno, Cesar Cabrera, Feliciano Duiguan, Cecilio Remotigue, and other employees receiving P4,200.00 p.a. or more
o Feb 5, 1958: petitioner filed a motion to dismiss the claim for overtime pay
As mere intervenors, the latter cannot raise new issues not litigated in the principal case, the same not being the lis mota involved.
o CIR: allowed the issue to be litigated. Petitioner's MR having been denied, it filed its answer to the petition for intervention.
Jan 16, 1961: CIR ruled that
o NAWASA is an agency not performing governmental functions and is thus liable to pay additional compensation for work on Sundays and legal
holidays conformably to CA 444 (8-Hour Labor Law), even if said days should be within the staggered 5 work days authorized by the President
o intervenors do not fall within the category of "managerial employees" as contemplated in RA 2377 and so are NOT exempt from the coverage
of the 8-Hour Labor Law
o computation followed by NAWASA in computing overtime compensation is contrary to CA 444
o undertime of a worker should NOT be set-off against the worker in determining whether he rendered service in excess of 8 hours for that day;
o in computing the daily wage of those employed daily, the additional 25% compensation for Sunday work should be included
o computation used by NAWASA for monthly salaried employees (dividing the monthly basic pay by 30) is erroneous
o minimum wage awarded by CIR on Nov 25, 1950 in MWD Workers Union v. Metropolitan Water District, applies even to those who were
employed long after the promulgation of the award and even if their workers are hired only as temporary, emergency and casual workers for a
definite period and for a particular project
o authority granted to NAWASA by the President to stagger the working days of its workers should be limited exclusively to those specified in the
authorization and should not be extended to others who are not therein specified
o CBA between NAWASA and unions on Dec 28, 1956 and Res No. 29 (1957) of the Grievance Committee, provide that even those who work
outside the sewerage chambers should be paid 25% additional compensation as "distress pay"
MR was denied, so NAWASA filed the present petition for review (only questions of law)
ISSUES [HELD]: CIR decision AFFIRMED with modifications.
1. WON NAWASA is performing governmental functions and, therefore, essentially a service agency of the government;
[NAWASA is a public corp., but it does NOT perform governmental functions. It performs proprietary functions and is thus covered by CA 444]
NAWASA: NAWASA is a service agency of the government and a public corp. under RA 1383, separate from the Dept. of Public Works!
o Public Service Commission does NOT have control, supervision or jurisdiction over it in fixing rates concerning the operation of the service
o It can incur indebtedness or issue bonds that are exempt from taxation which circumstance implies that it is essentially a government-
function corporation because it enjoys that attribute of sovereignty
SC: NOPE. NAWASA performs proprietary functions, and as such comes within the coverage of CA 444
o While under RA 1383, NAWASA is a public corp., it does not show that it was so created for the government of a portion of the State
o 2 kinds of public corporation: municipal and non-municipal
municipal corporation is the body politic constituted by the inhabitants of a city or town for the purpose of local government
thereof. It is established by law as an agency of the State to assist in the civil government of the country, chiefly to regulate the
local and internal affairs of the city or town that is incorporated
Non- municipal corporations are public corporations created as agencies of the State for limited purposes to take charge merely
of some public or state work other than community government
o NAWASA was NOT created for local government, but for consolidating and centralizing all waterworks, sewerage and drainage systems in
the Philippines under one control and direction and general supervision
o NAWASA has personality and power separate and distinct from the government. It is an independent agency placed, for administrative
purposes, under the Department of Public Works and Communications. It has continuous succession under its corporate name and sue and
be sued in court. It has corporate power to exercised by its board of directors; it has its own assets and liabilities; and it may charge rates for
its services

2. WON NAWASA is a public utility and, therefore, exempted from paying additional compensation for work on Sundays and legal holidays;
[NAWASA is a public utility. Although pursuant to Sec 4, CA 444 it is NOT obliged to pay an additional 25% to its laborers for work done on Sundays and
legal holidays, it must pay said additional compensation by virtue of the contractual obligation it assumed under the CBA]
We agree with NAWASA that it is a public utility and that a public utility is EXEMPT from paying additional compensation for work on Sundays and legal
holidays, per Sec 4, CA 444 which provides that the prohibition, regarding employment of Sundays and holidays unless an additional sum of 25% of
the employee's regular remuneration is paid, shall NOT apply to public utilities such as those supplying electricity, power, water or transportation.
o In other words, the employees and laborers of NAWASA can be made to work on Sundays and legal holidays without being required to pay
them an additional compensation of 25%.
HOWEVER, in this case it has been stipulated that prior to the enactment of RA 1880 (40-Hour Week Law), the Metropolitan Water District had been
paying 25% additional compensation for work on Sundays and legal holidays to its employees by virtue of Res. 47 (1948) of its board of Directors,
which practice was continued by the NAWASA when the latter took over the service.
o In the CBA between NAWASA and the unions, it was agreed that all existing benefits enjoyed by the employees prior to its effectivity shall
remain in force and shall form part of the agreement, among which certainly is the 25% additional compensation for work on Sundays and
legal holidays therefore enjoyed by said laborers and employees.
o While under CA 444 a public utility is NOT required to pay additional compensation to its employees and workers for work done on Sundays
and legal holidays, there is NO prohibition for it to pay such additional compensation if it voluntarily agrees to do so.
o NAWASA committed itself to pay this additional compensation. It must pay, not because the law, but because of contractual obligation

3. WON the intervenors are "managerial employees" under RA 2377 and, thus, not entitled to the benefits of CA 444, as amended;
[intervenors are NOT "managerial employees" under RA 2377, hence they are covered by CA 444, as amended]
"MANAGERIAL EMPLOYEES" within the meaning of RA 2377
o Sec. 2. This Act shall apply to all persons employed in any industry or occupation, whether public or private with the exception of farm
laborers, laborers who prefer to be paid on piece work basis, managerial employees, outside sales personnel, domestic servants, persons in
the personal service of another and members of the family of the employer working for him.
The term "managerial employee" shall mean either (a) any person whose primary duty consists of the management of the
establishment in which he is employed or of a customarily recognized department or subdivision thereof, or (b) ally officer or member of
the managerial staff.
o Explanatory note: he is NOT subject to the rigid observance of regular office hours. The true worth of his service does NOT depend so much
on the time he spends in office but more on the results he accomplishes. In fact, he is free to go out of office anytime
o Philosophy (behind exempting managerial employees from the 8-Hour Labor Law): such workers are not usually employed for every hour of
work; rather, their compensation is determined considering their special training, experience or knowledge which requires the exercise of
discretion and independent judgment, or perform work related to management policies or general business operations along specialized or
technical lines. For these workers it is NOT feasible to provide a fixed hourly rate of pay or maximum hours of labor
In the Fair Labor Standards Act of the US (considered by the sponsors of the present Act in defining the degree of work of a managerial employee)
o Sec 23 (a) (1), EXECUTIVE EMPLOYEES are EXEMPTED from the statutory requirements as to minimum wages and overtime pay
EXEMPTION attaches only where it appears that the employee's primary duty consists of the management of the establishment
or of a customarily recognized department or subdivision thereof, that he customarily and regularly directs the work of other
employees therein, that he has the authority to hire or discharge other employees or that his suggestions and
recommendations as to the hiring or discharging and as to the advancement and promotion or any other change of status of
other employees are given particular weight, that he customarily and, regularly exercises discretionary powers
o "ADMINISTRATIVE EMPLOYEE" is one who is compensated for his services at a salary or fee of NOT less than a prescribed sum per month,
and who regularly and directly assists an employee employed in a bona fide executive or administrative capacity, where such assistance is
nonmanual in nature and requires the exercise of discretion and independent judgment; or who performs under only general supervision,
responsible non-manual office or field work, directly related to management policies or general business operations, along specialized or
technical lines' requiring special training experience, or knowledge, and the exercise of discretion and independent judgment
o "PROFESSIONAL" EMPLOYEE is one who is engaged in work predominantly intellectual and varied in character, and requires the consistent
exercise of discretion and judgment in its performance and is of such a character that the output produced cannot be standardized in
relation to a given period of time, and whose hours of work of the same nature as that performed by non-exempt employees do NOT
exceed 20% of the hours worked in the work week by the non-exempt employees, EXCEPT where such work is necessarily incident to work of
a professional nature; and which requires, first, knowledge of an advanced type in a field of science or learning customarily acquired by a
prolonged course or specialized intellectual instruction and study, or, second, predominantly original and creative in character in a
recognized field of artistic endeavor
o Executive, administrative and professional workers are NOT usually employed at hourly wages nor is it feasible in the case of such
employees to provide a fixed hourly rate of pay nor maximum hours of labor
Intervenors herein are holding position of responsibility.
o One of them is the Secretary of the Board of Directors. Another is the private secretary of the general manager. Another is a public relations
officer, and many other chiefs of divisions or sections and others are supervisors and overseers.
o Their primary duties do not bear any direct relation with the management of the NAWASA, nor do they participate in the formulation of its
policies nor in the hiring and firing of its employees. The chiefs of divisions and sections are given ready policies to execute and standard
practices to observe for their execution. Hence, it concludes, they have little freedom of action, as their main function is merely to carry out
the company's orders, plans and policies
o they are required to observe working hours and record their time at work and are not free to come and go to their offices, nor move about
at their own discretion

4. WON CIR has jurisdiction to adjudicate overtime pay considering that this issue was not part of the principal case but was raised by the intervenors;
[CIR has jurisdiction to adjudicate overtime pay, there being an employer-employee relationship existing between intervenors and petitioner]
NAWASA: issue of overtime compensation was not raised in the original case but merely dragged into it by intervenors, so CIR has no jurisdiction
SC: matter subject of intervention comes within the jurisdiction of CIR
o No dispute that the intervenors were in the employ of petitioner when they intervened and that their claim refers to the 8-Hour Labor
Law
o disputes that call for the application of the 8-Hour Labor Law are within the CIRs jurisdiction if they arise while the employer-employee
relationship still exists.
o That the question of overtime payment is not included in the principal case as an item of dispute certified to by the President is of no
moment, for it comes within the sound discretion of CIR.
o Moreover, in labor disputes, technicalities of procedure should as much as possible be avoided not only in the interest of labor but to avoid
multiplicity of action.

5. WON those attached to the General Auditing Office and the Bureau of Public Works come within the purview of CA 444, as amended;
[GAO employees assigned in NAWASA cannot be regarded as its employees on matters relating to compensation. They are employees of the national
government and are NOT covered by the 8-Hour Labor Law. Same with those of the Bureau of Public Works assigned in NAWASA]
Issue already resolved in a prior case (same ruling applies to employees of both GAO and BPW)
members of the auditing force CANNOT be regarded as employees of [NAWASA] in matters relating to their compensation.
o They are appointed and supervised by the Auditor General, have an independent tenure, and work subject to his orders and instructions,
and NOT to those of the management of appellants.
o Above all, the nature of their functions and duties, for the purpose of fiscal control of appellants' operations, imperatively demands that
their positions be completely independent from interference or inducement on the part of the supervised management, in order to assure
a maximum of impartiality in the auditing functions.
o Both independence and impartiality require that the employees be utterly free from apprehension as to their tenure and from expectancy
of benefits resulting from any action of the management
The inclusion of their items in the [NAWASA] budget should be viewed as no more than a designation by the national government of the fund or source
from which their emoluments are to be drawn, and does NOT signify that they are thereby made [NAWASA] employees

6. In determining whether one has worked in excess of 8 hours, whether the undertime for that day should be set off;
[NAWASAs method in off-setting the overtime with the undertime and at the same time charging said undertime to the accrued leave is UNFAIR]
A worker is entitled to overtime pay only for work in actual service beyond 8 hours.
NAWASA: If a worker should incur in undertime during his regular daily work, said undertime should be deducted in computing his overtime work
SC: NO! Method used by NAWASA in offsetting the overtime with the undertime and at the same time charging said undertime to the accrued leave of
the employee is UNFAIR, for under such method the employee is made to pay twice for his undertime
o his leave is reduced to that extent while he was made to pay for it with work beyond the regular working hours.
Proper method: deduct the undertime from the accrued leave, but pay the employee the overtime to which he is entitled.

7. In computing the daily wage, WON the additional compensation for Sunday work should be included;
[Differential pay for Sundays is a part of the legal wage. It was correctly included in computing the weekly wages of employees and laborers who worked
7 days a week and were regularly receiving the 25% salary differential for 3 months prior to the implementation of RA 1880. This is so even if petitioner is
a public utility in view of the contractual obligation it has assumed on the matter]
NAWASA: daily wage should be computed exclusively on the basic wage, WITHOUT including the automatic 25% increase (Sunday differential).
o To include said Sunday differential would be to increase the basic pay which is not contemplated by said Act.
CIR: disagrees with this manner of computation. RA 1880 requires that the basic weekly wage and the basic monthly salary should NOT be diminished
notwithstanding the reduction in the number of working days a week.
SC: CIR correctly included differential pay in computing the weekly wages of those employees and laborers who worked seven days a week and were
continuously receiving 25% Sunday differential for 3 months immediately preceding the implementation of RA 1880
o RA 1880 does NOT intend to raise the wages of the employees over what they are actually receiving. Rather, its purpose is to LIMIT the
working days in a week to 5 days, or to 40 hours without permitting any reduction in the weekly or daily wage of the compensation
previously received
o for purposes of computing overtime compensation a regular wage includes all payments which the parties have agreed shall be received
during the work week, including piece work wages, differential payments for working at undesirable times, such as at night or on Sundays
and holidays, and the cost of board and lodging customarily furnished the employee
o The "regular rate" of pay also ordinarily includes incentive bonus or profit-sharing payments made in addition to the normal basic pay, and
it was also held that the higher rate for night, Sunday and holiday work is just as much a regular rate as the lower rate for daytime work.
The higher rate is merely an inducement to accept employment at times which are not as desirable from a workman's standpoint

8. What is the correct method to determine the equivalent daily wage of a monthly salaried employee;
[In the computation of the daily wages of employees paid by the month, distinction should be made between government employees like the GAO
employees and those who are not. The computation for government employees is governed by Sec 254 of the Revised Administrative Code, while for
others the correct computation is the monthly salary divided by the actual number of working hours in the month or the regular monthly compensation
divided by the number of working days in the month]
NAWASA: in computing this daily rate, divide the monthly basic pay of the employee by 30 (per Sec 254, Revised Administrative Code which provides
that "In making payment for part of a month, the amount to be paid for each day shall be determined by dividing the monthly pay into as many parts
as there are days in the particular month."
CIR: disagrees with this method. The correct computation of the daily rate of a monthly employee shall be (a) the monthly salary divided by the actual
of working hours in a month or (b) the regular monthly compensation divided by the number of working days in a month
SC: finding of CIR should be modified insofar as the employees of the GAO and of the BPW assigned to work in the NAWASA are concerned
o they are government employees and should be governed by Sec 254, Revised Administrative Code (provides that in making payments for
part of a month, the amount to be paid for each day shall be determined by dividing the monthly pay into as many parts as there are days in
the month).

9. Considering that the payment of night compensation is not by virtue of any statutory provision but emanates only from an award of CIR, WON the same can
be made retroactive and cover a period prior to the promulgation of the award;
[CIR was correct in ordering the payment of night compensation from the time such services were rendered. The laborer must be compensated for
nighttime work as of the date the same was rendered]
CIR: awarded an additional 25% night compensation to some workers with retroactive effect (effective even before the presentation of the claim,
provided that they had been given authorization by the general manager to perform night work)
NAWASA: No statute requiring payment of additional compensation for night work. It can only be grantedby the voluntary act of the employer or by an
award of CIR under its compulsory arbitration power such grant should only be prospective, not retroactive
SC: not erroneous for CIR to make the payment of such night compensation retroactive to the date when the work was actually performed.
o working man who has already rendered night time service takes him a long time before he can muster enough courage to confront his
employer with the demand for payment for it for fear of possible reprisal
o power of CIR to order the payment of compensation for overtime service prior to the date of the filing of the claim has been recognized

10. WON the minimum wage fixed and awarded by CIR in another case (MWD Workers Union v. MWD CIR; CIR Case 359-V; Nov 25, 1950) applies to those
employed long after the promulgation thereof, whether hired as temporary, emergency and casual workers for a definite period and for a specific project;
[Rates of minimum pay fixed in CIR Case 359-V are applicable also to those who were employed subsequent to the date of the decision]
Case 359-V fixed the following rates of minimum daily wage P5.25 for those working in Manila and suburbs; P4.50 for those working in Quezon City;
and P4.00 for those working in Ipo. Montalban and Balara
NAWASA: in spite of the notice to terminate said award filed with the court on Dec 29, 1953, the Metropolitan Water District continued paying the
above wages and NAWASA (successor) adopted the same rates for some time. In Sept 1955, NAWASA hired the claimants as temporary workers and it
is now contended that said rates cannot apply to these workers
CIR: discontinuance of this minimum wage rate was improper. Ordered the payment of the difference to said workers
o Case 359-V is applicable NOT only to those laborers already in the service but also to those who may be employed thereafter;
o notice of determination of said award given on Dec 29, 1953 is not legally effective because the same was given without hearing and the
employer continued paying the minimum wages even after the notice of termination
SC: Agree with CIR. Award continued to be valid and effective in spite of the notice of termination given by the employer
o No good reason why such award should not apply to those who may be employed after its approval by the court
o CIR can at any time during the effectiveness of an award or reopen any question involved therein under Sec 17, CA 103, and such is what
said court has done when it made the award extensive to the new employees. (otherwise discrimination will be fostered)

11. How should the CBA and Res. 29 (1957) of the Grievance Committee be construed insofar as the stipulations therein relative to "distress pay" is concerned;
[All laborers, WON assigned to the sewerage division, who work inside or outside the sewerage chambers, are entitled to distress pay]
question that arose in connection with this distress pay is the meaning of the phrase "who actually work in and outside sewerage chambers."
NAWASA: distress pay should be given only to those who actually work inside the sewerage chambers
CIR / UNIONS: pay should be given to all those whose work have to do with the sewerage chambers, whether inside or outside
SC: CBA provides that those who are entitled to the distress pay are those employees and laborers who work in the sewerage chambers whether they
belong to the sewerage division or not, and by sewerage chambers should be understood to mean as the surroundings where the work is actually
done, NOT necessarily "inside the sewerage chambers."
o all the laborers whether of the sewerage division or not assigned to work in and outside the sewerage chambers and suffer in unusual
distress because of the nature of their work are entitled to the extra compensatory
o wet pits, trenches, manholes, which are full of sewage matters, are filthy sources of germs and different diseases. They emit foul and filthy
odor dangerous to health. Those working in such places and exposed directly to the distress of contamination

12. WON, under the first indorsement of the President (Aug 12, 1957; authorized NAWASA to stagger the working days of its employees and laborers) those
whose services are indispensably continuous throughout the year may be staggered in the same manner as the pump, valve, filter and chlorine operators,
guards, watchmen, medical services, and those attached to the recreational facilities.
[Work of the personnel in the construction, sewerage, maintenance, machineries and shops of petitioner is NOT continuous as to require staggering]
NAWASA: staggered the work schedule of the employees and laborers performing the above activities
UNIONS: protested against the staggering schedule of work
CIR: justified the staggering of the work days for the reason that the same was made pursuant to the authority granted by the President (powers
conferred upon him by RA 1880). However, the staggering should not apply to the personnel in the construction, sewerage, maintenance, machineries
and shops because they work below 365 days a year and their services are NOT continuous to require staggering.
SC: No reason to disturb CIRs finding.

04. National Sugar Refineries Corporation v. NLRC AUTHOR: S A Y O


G.R. No. 101761. March 24, 1993 NOTES:
TOPIC: Work Hours
PONENTE: Regalado
CASE LAW/ DOCTRINE:
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

FACTS:
Petitioner National Sugar Refineries Corporation (NASUREFCO), a corporation owned and controlled by the Government, operates three (3) sugar refineries
located at Bukidnon, Iloilo and Batangas.
The Batangas refinery was privatized on April 11, 1992 pursuant to Proclamation No. 50.
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, etc.. basta various supervisory officers)
June 1, 1988- petitioner implemented a Job Evaluation (JE) Program affecting all employees, from rank-and-file to department 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.
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.
With the implementation of the JE Program, the following adjustments were made(JUST IN CASE):
(1) the members of respondent union were re-classified and 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.
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.
LA favored respondent union (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)
NLRC affirmed (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.)
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.
ISSUE(S): WON 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.
HELD: YES. Hence, not entitled to OT, rest day, and holiday pay.

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.: 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.
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.

WITH REGARD TO THE CONTRACTUAL OBLIGATION ISSUE:


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.

05 Penaranda V. Baganga Plywood Corporation. AUTHOR: REYES


[G.R. No. Date] NOTES: As shift engineer, petitioners duties and responsibilities were as
TOPIC: Work Hours PONENTE: Panganiban follows:
"1. To supply the required and continuous steam to all consuming
units at minimum cost.
"2. To supervise, check and monitor manpower workmanship as
well as operation of boiler and accessories.
"3. To evaluate performance of machinery and manpower.
"4. To follow-up supply of waste and other materials for fuel.
"5. To train new employees for effective and safety while working.
"6. Recommend parts and supplies purchases.
"7. To recommend personnel actions such as: promotion, or
disciplinary action.
"8. To check water from the boiler, feedwater and softener,
regenerate softener if beyond hardness limit.
"9. Implement Chemical Dosing.
"10. Perform other task as required by the superior from time to
time."
DOCTRINE:
Article 82 of the Labor Code exempts managerial employees from the coverage of labor standards. Labor standards provide the working conditions of
employees, including entitlement to overtime pay and premium pay for working on rest days. Under this provision, managerial employees are "those
whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision."
FACTS:
Charlito Penaranda was hired by Baganga Plywood Corporation to be their employee
He was given the task of managing and maintaining its steam plant boiler.
BGC is a domestic corporation and is represented by one Hudson Chua
Penanranda through Counsel in his position paper alleges that he was employed by respondent Baganga on March 15 1999 with a monthly salary of
P5,000 as Foreman/boiler head/shift engineer until he was allegedly illegally terminated on December 19, 1999.
Further he was not paid his overtime pay, premium pay for working during holidays or rest days, night shift differentials.
Respondent BPC argued that it was on temporary closure due to repair and general maintenance so it applied for clearance with DOLE.
That due to the insistence of Penaranda, he was paid his separation benefits
Consequently, when respondent [BPC] partially reopened in January 2001, [Pearanda] failed to reapply.
Hence, he was not terminated from employment much less illegally. He opted to severe employment when he insisted payment of his separation
benefits.
Respondents also argue being a managerial employee he is not entitled to overtime pay and if ever he rendered services beyond the normal hours of
work, [there] was no office order/or authorization for him to do so.
Labor arbiter ruled that there was no illegal dismissal and that petitioners Complaint was premature because he was still employed by BPC.
The temporary closure of BPCs plant did not terminate his employment; hence, he need not reapply when the plant reopened.
According to the labor arbiter, petitioners money claims for illegal dismissal was also weakened by his quitclaim and admission during the clarificatory
conference that he accepted separation benefits, sick and vacation leave conversions and thirteenth month pay.
The labor arbiter found petitioner entitled to overtime pay, premium pay for working on rest days, and attorneys fees in the total amount of
P21,257.98.
Respondents filed an appeal to the NLRC, which deleted the award of overtime pay and premium pay for working on rest days.
According to the Commission, petitioner was not entitled to these awards because he was a managerial employee.
CA dismissed Pearandas Petition for Certiorari.
The appellate court held that he failed to: 1) attach copies of the pleadings submitted before the labor arbiter and NLRC; and 2) explain why the filing
and service of the Petition was not done by personal service.
Petition to SC.
ISSUE(S):
1. Whether or Not: The finding of the [labor arbiter] that Pearanda is a regular, common employee entitled to monetary benefits under Art. 82 of the Labor
Code is wrong.
2. Whether or Not: The finding that Pearanda is entitled to the payment of OVERTIME PAY and OTHER MONETARY BENEFITS is wrong.
HELD: Yes- he was an employee and yes he is not entitled to the benefits.
Petitioner claims that he was not a managerial employee, and therefore, entitled to the award granted by the labor arbiter.
Article 82 of the Labor Code exempts managerial employees from the coverage of labor standards. Labor standards provide the working conditions of
employees, including entitlement to overtime pay and premium pay for working on rest days. Under this provision, managerial employees are "those
whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision."
The Implementing Rules of the Labor Code define members of a managerial staff as those with the following duties and responsibilities:
"(1) The primary duty consists of the performance of work directly related to management policies of the employer;
"(2) Customarily and regularly exercise discretion and independent judgment;
"(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
"(4) Who do not devote more than 20 percent of their hours worked in a workweek to activities which are not directly and closely related to the performance of
the work described in paragraphs (1), (2), and (3) above."

Petitioner was a member of the managerial staff. He performed items 1, 2, 3, 5, and 7.


His duties and responsibilities conform to the definition of a member of a managerial staff under the Implementing Rules.
Petitioner supervised the engineering section of the steam plant boiler. His work involved overseeing the operation of the machines and the
performance of the workers in the engineering section.
This work necessarily required the use of discretion and independent judgment to ensure the proper functioning of the steam plant boiler.
As supervisor, petitioner is deemed a member of the managerial staff.
Noteworthy, even petitioner admitted that he was a supervisor, he stated that he was the foreman responsible for the operation of the boiler.
The term foreman implies that he was the representative of management over the workers and the operation of the department.
Petitioners evidence also showed that he was the supervisor of the steam plant.
His classification as supervisor is further evident from the manner his salary was paid.
He belonged to the 10% of respondents 354 employees who were paid on a monthly basis; the others were paid only on a daily basis.
CASE LAW/ DOCTRINE:

06 Far East Agricultural Supply, Inc. vs. Lebatique AUTHOR: SOLIS


[G.R. No. 162813 | February 12, 2007] NOTES:
TOPIC: Hours of Work
PONENTE: Quisumbing
CASE LAW/ DOCTRINE:

FACTS:
Petitioner Far East Agricultural Supply, Inc. (Far East) hired Jimmy Lebatique as truck driver with a daily wage of P223.50. He delivered animal feeds to the
companys clients.
On 24 January 2000 Far Easts GM and petitioner Alexander Uy suspended Lebatique apparently for illegal use of companys vehicle.
On the same day, Lebatique complained of nonpayment of overtime work particularly on January 22, 2000, when he was required to make a second
delivery in Novaliches, Quezon City. He claims that he has never been paid overtime pay.
Lebatique then filed an Illegal Dismissal case against the Far East.
LA: ruled in favor of Lebatique. Petitioner Uy was ordered to reinstate Lebatique and at the same time to pay Lebatique his 13th month pay, back wages
(time when case was pending), service incentive leave pay and overtime payall amounting to P196,659.72
Petitioner Uy argued that Lebatique was not dismissed and that he was merely suspended; that he abandoned his job; and that Lebatique was a field
personnel not entitled to overtime pay and service incentive leave.
ISSUE(S):
(1) Whether Lebatique was illegally dismissed.
(2) Whether Lebatique was a field personnel, not entitled to overtime pay.
HELD: (1) Yes; (2) Lebatique is a regular employee
FIRST ISSUE
It is well settled that in cases of illegal dismissal, the burden is on the employer to prove that the termination was for a valid cause. In this case, petitioners
failed to discharge such burden. Petitioners aver that Lebatique was merely suspended for one day but he abandoned his work thereafter. To constitute
abandonment as just cause for dismissal, there must be: (a) absence without justifiable reason; and (b) a clear intention, as manifested by some overt
act, to sever the employer-employee relationship.
The records show that petitioners failed to prove that Lebatique abandoned his job. Nor was there a showing of a clear intention on the part of Lebatiquw
to sever the employer-employee relationship. When Lebatique was verbally told by Alexander Uy, the companys General Manager, to look for another
job, Lebatique was in effect dismissed. Even assuming earlier he was merely suspended for illegal use of company vehicle, the records do not show that
he was afforded the opportunity to explain his side. It is clear also from the sequence of the events leading to Lebatiques dismissal that it was Lebatiques
complaint for nonpayment of his overtime pay that provoked the management to dismiss him, on the erroneous premise that a truck driver is a field
personnel not entitled to overtime pay.
SECOND ISSUE
Field personnelshall 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.
In Auto Bus Transport Systems, Inc. vs. Bautista, this Court emphasized 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. We held that
field personnel are those who regularly perform their duties away from the principal place of business of the employer and whose actual work in the
field cannot be determined with reasonable certainty. Thus, in order to determine 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 correctly found by the CA, Lebatique is not a field personnel as defined above for the following reasons: (1) company drivers, including Lebatique, are
directed to deliver the goods at a specified time and place; (2) they are not given the discretion to solicit, select and contact prospective clients; and (3)
Far East issued a directive that company drivers should stay at the clients premises during truck-ban hours which is from 5:00 to 9:00 a.m. and 5:00 to
9:00 p.m. Even petitioners admit that the drivers can report early in the morning, to make their deliveries, or in the afternoon, depending on the
production of animal feeds. Drivers, like Lebatique, are under the control and supervision of management officers. Lebatique, therefore, is a regular
employee whose tasks are usually necessary and desirable to the usual trade and business of the company. Thus, he is entitled to the benefits accorded
to regular employees of Far East, including overtime pay and service incentive leave pay.

7. Union of Filipro Employees (UFE) vs Benigno Vivar, Jr., NLRC, and Nestle AUTHOR: The Talio
Philippines, Inc. NOTES:
[G.R. No. 79255; January 20, 1992] UFE Union of Filipro Employees
TOPIC: 13.3.3 Exemptions Field Personnel
PONENTE: Gutierrez, Jr., J.
CASE LAW/ DOCTRINE:
Under Art. 82, field personnel are not entitled to holiday pay. Said article defines field personnel as "non-agritultural employees who regularly perform their
duties away from the principal place of business or branch office of the employer and whose actual hours of work in the field cannot be determined with
reasonable certainty."
The law requires that the actual hours of work in the field be reasonably ascertained. The company has no way of determining whether or not these sales
personnel, even if they report to the office before 8:00 a.m. prior to field work and come back at 4:30 p.m, really spend the hours in between in actual field
work.
Moreover, the requirement that "actual hours of work in the field cannot be determined with reasonable certainty" must be read in conjunction with Rule
IV, Book III of the Implementing Rules which provides:
Rule IV Holidays with Pay
Sec. 1. Coverage This rule shall apply to all employees except:
(e) Field personnel and other employees whose time and performance is unsupervised by the employer .

FACTS:
Nov. 8, 1985 Nestle Philippines (formerly known as Filipro, Inc.) filed with the NLRC a petition for declaratory relief seeking a ruling on its rights and
obligations respecting claims of its monthly paid employees for holiday pay in the light of the Court's decision in Chartered Bank Employees Association v.
Ople.
Both Nestle and the UFE agreed to submit the case for voluntary arbitration and appointed Vivar as voluntary arbitrator.
Jan. 2, 1980 - Vivar rendered a decision directing Nestle to pay its monthly paid employees holiday pay pursuant to Art. 94 of the Code, subject only to the
exclusions and limitations specified in Art. 82 and such other legal restrictions as are provided for in the Code.
Nestle filed a motion for clarification seeking
o the limitation of the award to 3 years;
o the exclusion of salesmen, sales representatives, truck drivers, merchandisers and medical representatives (hereinafter referred to as sales personnel)
from the award of the holiday pay; and
o deduction from the holiday pay award of overpayment for overtime, night differential, vacation and sick leave benefits due to the use of 251 divisor.
UFE answered that:
o the award should be made effective from the date of effectivity of the Labor Code;
o that their sales personnel are not field personnel and are therefore entitled to holiday pay; and
o that the use of 251 as divisor is an established employee benefit which cannot be diminished.
Jan. 14, 1986 Vivar issued an order declaring that the effectivity of the holiday pay award shall retroact to Nov. 1, 1974, the date of effectivity of the Labor
Code. He adjudged, however, that the company's sales personnel are field personnel and, as such, are not entitled to holiday pay. He likewise ruled that with
the grant of 10 days holiday pay, the divisor should be changed from 251 to 261 and ordered the reimbursement of overpayment for overtime, night
differential, vacation and sick leave pay due to the use of 251 days as divisor.
The requirement for the salesmen and other similarly situated employees to report for work at the office at 8:00 a.m. and return at 4:00 or 4:30 p.m. is
not within the realm of work in the field as defined in the Code but an exercise of purely management prerogative of providing administrative control
over such personnel. This does not in any manner provide a reasonable level of determination on the actual field work of the employees which can be
reasonably ascertained. The theoretical analysis that salesmen and other similarly-situated workers regularly report for work at 8:00 a.m. and return to
their home station at 4:00 or 4:30 p.m., creating the assumption that their field work is supervised, is surface projection. Actual field work begins after
8:00 a.m., when the sales personnel follow their field itinerary, and ends immediately before 4:00 or 4:30 p.m. when they report back to their office. The
period between 8:00 a.m. and 4:00 or 4:30 p.m. comprises their hours of work in the field, the extent or scope and result of which are subject to their
individual capacity and industry and which "cannot be determined with reasonable certainty." This is the reason why effective supervision over field
work of salesmen and medical representatives, truck drivers and merchandisers is practically a physical impossibility. Consequently, they are excluded
from the ten holidays with pay award.
Both Nestle and UFE filed their respective motions for partial reconsideration. Vivar treated the two motions as appeals and forwarded the case to the NLRC
which issued a resolution remanding the case to Vivar on the ground that it has no jurisdiction to review decisions in voluntary arbitration cases pursuant to
Art. 263 of the Labor Code as amended by Sec. 10 of BP Blg. 130, and as implemented by Sec. 5 of the rules implementing BP Blg. 130.
July 6, 1987 - Vivar refused to take cognizance of the case reasoning that he had no more jurisdiction to continue as arbitrator because he had resigned from
service effective May 1, 1986.
ISSUE: WON Nestles sales personnel are entitled to holiday pay.
HELD: No I wont wait forever
Under Art. 82, field personnel are not entitled to holiday pay. Said article defines field personnel as "non-agritultural employees who regularly perform their
duties away from the principal place of business or branch office of the employer and whose actual hours of work in the field cannot be determined with
reasonable certainty."
The controversy centers on the interpretation of the clause "whose actual hours of work in the field cannot be determined with reasonable certainty."
It is undisputed that these sales personnel start their field work at 8:00 a.m. after having reported to the office and come back to the office at 4:00 p.m. or
4:30 p.m. if they are Makati-based. UFE maintains that the period between 8:00 a.m. to 4:00 or 4:30 p.m. comprises the sales personnel's working hours which
can be determined with reasonable certainty.
The Court does not agree. The law requires that the actual hours of work in the field be reasonably ascertained. The company has no way of determining
whether or not these sales personnel, even if they report to the office before 8:00 a.m. prior to field work and come back at 4:30 p.m, really spend the hours
in between in actual field work. We concur with disquisition by the respondent arbitrator.
Moreover, the requirement that "actual hours of work in the field cannot be determined with reasonable certainty" must be read in conjunction with Rule IV,
Book III of the Implementing Rules which provides:
Rule IV Holidays with Pay
Sec. 1. Coverage This rule shall apply to all employees except:
(e) Field personnel and other employees whose time and performance is unsupervised by the employer .
While contending that such rule added another element not found in the law, UFE nevertheless attempted to show that its affected members are not covered
by the abovementioned rule. UFE asserts that the company's sales personnel are strictly supervised as shown by the SOD (Supervisor of the Day) schedule and
the company circular dated March 15, 1984.
Contrary to the contention of UFE, the Court finds that the aforementioned rule did not add another element to the Labor Code definition of field personnel.
The clause "whose time and performance is unsupervised by the employer" did not amplify but merely interpreted and expounded the clause "whose actual
hours of work in the field cannot be determined with reasonable certainty." The former clause is still within the scope and purview of Art. 82 which defines
field personnel. Hence, in deciding whether or not an employee's actual working hours in the field can be determined with reasonable certainty, query must
be made as to whether or not such employee's time and performance is constantly supervised by the employer.
The SOD schedule adverted to by the petitioner does not in the least signify that these sales personnel's time and performance are supervised. The purpose
of this schedule is merely to ensure that the sales personnel are out of the office not later than 8:00 a.m. and are back in the office not earlier than 4:00 p.m.
Likewise, the Court fails to see how the company can monitor the number of actual hours spent in field work by an employee through the imposition of
sanctions on absenteeism contained in the company circular of March 15, 1984.
UFE claims that the fact that these sales personnel are given incentive bonus every quarter based on their performance is proof that their actual hours of work
in the field can be determined with reasonable certainty. The Court thinks otherwise.
The criteria for granting incentive bonus are: (1) attaining or exceeding sales volume based on sales target; (2) good collection performance; (3) proper
compliance with good market hygiene; (4) good merchandising work; (5) minimal market returns; and (6) proper truck maintenance.
The above criteria indicate that these sales personnel are given incentive bonuses precisely because of the difficulty in measuring their actual hours of field
work. These employees are evaluated by the result of their work and not by the actual hours of field work which are hardly susceptible to determination.
8 MERCIDAR FISHING CORPORATION vs NLRC AUTHOR: TAN
[G.R. No. 112574. October 8, 1998] NOTES:
TOPIC: Field Personnel
PONENTE: MENDOZA, J.
CASE LAW/ DOCTRINE:
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.

In deciding whether or not an employees actual working hours in the field can be determined with reasonable certainty, query must be made as to whether or not
such employees time and performance is constantly supervised by the employer.

FACTS:
Private respondent, Fermin Agao, Jr., had been employed as a bodegero or ships quartermaster on February 12, 1988.
He filed a complaint against petitioner Mercidar for for illegal dismissal, violation of P.D. No. 851, and non-payment of five days service incentive leave for
1990.
Agao alleged:
o That he had been sick and thus allowed to go on leave without pay for one month;
o That when he reported to work at the end of such period with a health clearance, he was told to come back another time as he could
not be reinstated immediately;
o That petitioner refused to give him work thereafter;
o That for this reason, private respondent asked for a certificate of employment from petitioner;
o That Mercidar refused to issue the certificate unless he submitted his resignation; and
o That since he refused to submit such letter unless he was given separation pay, Mercidar prevented him from entering the premises.
Mercidar alleged:
o That it was Agao who actually abandoned his work;
o That the he failed to report for work after his leave had expired and was, in fact, absent without leave for three months;
o That, nonetheless, it assigned private respondent to another vessel, but the latter was left behind;
o That private respondent asked for a certificate of employment on the pretext that he was applying to another fishing company; and
o That he refused to get the certificate and resign unless he was given separation pay.
LA: ordered Mercidar to reinstate Agao with backwages and, to pay him his 13th month pay and incentive leave pay for 1990.
NLRC:
o Dismissed the appeal for lack of merit;
o Dismissed petitioners claim that it cannot be held liable for service incentive leave pay by fishermen in its employ as the latter supposedly are
field personnel and thus not entitled to such pay under the Labor Code; and
o Denied petitioners motion for reconsideration.

ISSUE(S): Whether fishing crew members, like Agao, can be classified as field personnel under Article 82 of the Labor Code.
HELD: NO. Petition is DISMISSED.

Mercidar argues that since Agaos work is performed away from its principal place of business, it has no way of verifying his actual hours of work on the
vessel. It contends that private respondent and other fishermen in its employ should be classified as field personnel who have no statutory right to service
incentive leave pay.
Art. 82 of the Labor Code provides:
ART. 82. Coverage. - The provisions of this Title [Working Conditions and Rest Periods] shall apply to employees in all establishments and undertakings whether for
profit or not, but not to government 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.
..........
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.
The requirement that actual hours of work in the field cannot be determined with reasonable certainty must be read in conjunction with Rule IV, Book III of
the Implementing Rules which provides:
Rule IV Holidays with Pay
Section 1. Coverage - This rule shall apply to all employees except:
..........
(e) Field personnel and other employees whose time and performance is unsupervised by the employer xxx
While contending that such rule added another element not found in the law, the Mercidar nevertheless attempted to show that its affected members are
not covered by the abovementioned rule. The petitioner asserts that the companys sales personnel are strictly supervised as shown by the SOD (Supervisor
of the Day) schedule and the company circular dated March 15, 1984.
The Court finds that the aforementioned rule did not add another element to the Labor Code definition of field personnel. The clause whose time and
performance is unsupervised by the employer did not amplify but merely interpreted and expounded the clause whose actual hours of work in the field
cannot be determined with reasonable certainty. The former clause is still within the scope and purview of Article 82 which defines field personnel. Hence, in
deciding whether or not an employees actual working hours in the field can be determined with reasonable certainty, query must be made as to whether or
not such employees time and performance is constantly supervised by the employer.
During the entire course of their fishing voyage, fishermen employed by petitioner have no choice but to remain on board its vessel. Although they perform
non-agricultural work away from petitioners business offices, the fact remains that throughout the duration of their work they are under the effective
control and supervision of petitioner through the vessels patron or master as the NLRC correctly held.

09 Ultra Villa Food Haus v. Geniston AUTHOR: TIGLAO


[G.R. No. 120473 | 23 June 1999] NOTES:
TOPIC: Hours of Work | PONENTE: J.
Kapunan
CASE LAW/ DOCTRINE:
To constitute abandonment, two requisites must concur:
1. The failure to report to work or absence without valid or justifiable reason; and
2. A clear intention to sever the employer-employee relationship, as manifested by some overt act (Note: This is the more determinative factor)
The burden of proving abandonment as a just cause for dismissal is on the employer.
FACTS:
Respondent Geniston was employed by petitioner Ultra Villa Food Haus and its owner, Tio. The former alleges that he was employed as an all around
personnel, serving as a waiter, driver, and maintenance man of the restaurant.
In 11 May 1992, respondent Geniston acted as a poll watcher for the National Union of Christian Democrats. Due to this engagement, he failed to report
for work on two consecutive days.
Upon arriving home, Geniston discovered that Tio, owner of Ultra Villa Food Haus, phoned his mother and informed her that respondent has been
dismissed from work. Hence, Geniston went to plead to Tio, only to receive a brow beating with an attempt to forcefully resign him.
Ruling of the Labor Arbiter:
o Respondent prayed for overtime pay, reinstatement, etc. Tio, on the other hand, maintained that he was her personal driver and was not an
employee of Ultra Villa Food Haus. Tio denies dismissing respondent; instead, she claims that it was abandoned.
o LA found that Geniston was indeed Tios personal driver. He was not an employee.
Ruling of the NLRC:
o It ordered petitioner to reinstate Geniston. Declared him as an employee of Ultra Villa Food Haus.
o On MR, NLRC affirmed his reinstatement, but instead awarded separation pay due to the closure of the business, but denied his prayer for
damages and attorneys fees.
ISSUE: W/N respondent Geniston is an employee of the Ultra Villa Food Haus or merely the personal driver of petitioner.
HELD: NO. He is only a personal driver and not an employee of the business. Nonetheless, he was illegally dismissed.
The Supreme Court found that Geniston was the personal driver of petitioner Tiu, not of Ultra Villa Food Haus, as shown by the submitted evidence
and admissions of the respondent that he was petitioners personal driver such as:
o Respondents admission that he was the personal driver
o Copies of the Ultra Villa Food Haus pay roll which did not contain his name
o Affidavits from the sames employees attesting that respondent was never an employee
o Petitioners undisputed allegation that she works as the branch manager of CFC Corporation whose office is located in Mandaue City.
o Joint affidavit of the warehouseman and checker of CFC Corporation, as regards the respondents status as a driver
The criterion of house helper under Art. 141 have been met:
Domestic or household service shall mean services in the employers home which is usually necessary or desirable for the maintenance and
enjoyment therefore and includes ministering to the personal comfort and convenience of the members of the employers household,
including services of family drivers.
The Labor Code expressly excludes domestic helpers from its coverage, and as such, petitioner is not required to grant OT, holiday pay, premium pay
and SIL. While PD851 excludes house helpers from the coverage of 13th month pay, petitioner was required to pay such considering that it has been its
practice to give its employees 13th Month Pay.
The Court found, however, that respondent did not abandon his job, as the two requisites (failure to report to work without valid reason, and a clear
intention to severe the employer-employee relationship) were not met. Petitioner failed to prove abandonment. It is quite unbelievable that private
respondent would leave a stable and relatively well-paying job as petitioners family driver to work as an election worker - the functions of which are
seasonal and temporary in nature. He was unjustly dismissed from work, and is entitled to indemnity as provided for under Art. 149 of the Labor Code.
Further, because of failure to comply with due process in dismissing private respondent, petitioner was also ordered to pay an additional indemnity of
P 1,000.00
Hence, respondent Geniston is declared as Tios personal driver and that he was illegally dismissed from his work.

10 David Vs. Macasio AUTHOR: Valera ( SORRY MAHABA TALAGA)


G.R. No. 195466 July 2, 2014 NOTES:
Hours Of Work: Brion: Article 82 of the Labor Code provides the exclusions from the coverage of Title I, Book III of the Labor Code - provisions
governing working conditions and rest periods.

Art. 82. Coverage. The provisions of [Title I] 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.

xxxx

"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.

Among the Title I provisions are the provisions on holiday pay (under Article 94 of the Labor Code) and SIL pay (under
Article 95 of the Labor Code). Under Article 82,"field personnel" on one hand and "workers who are paid by results" on
the other hand, are not covered by the Title I provisions. The wordings of Article82 of the Labor Code additionally
categorize workers "paid by results" and "field personnel" as separate and distinct types of employees who are
exempted from the Title I provisions of the Labor Code.

The pertinent portion of Article 94 of the Labor Code and its corresponding provision in the IRR47 reads:

Art. 94. Right to holiday pay. (a) Every worker shall be paid his regular daily wage during regular holidays, except in retail
and service establishments regularly employing less than (10) workers[.] [emphasis ours]
xxxx

SECTION 1. Coverage. This Rule shall apply to all employees except:

xxxx

(e)Field personnel and other employees whose time and performance is unsupervised by the employer including those
who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for
performing work irrespective of the time consumed in the performance thereof. [emphases ours]

On the other hand, Article 95 of the Labor Code and its corresponding provision in the IRR48 pertinently provides:

Art. 95. Right to service incentive. (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.

(b) This provision shall not apply to those who are already enjoying the benefit herein provided, those enjoying vacation
leave with pay of at least five days and those employed in establishments regularly employing less than ten employees
or in establishments exempted from granting this benefit by the Secretary of Labor and Employment after considering
the viability or financial condition of such establishment. [emphases ours]

xxxx

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

xxxx

(e) 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 a fixed amount for performing work
irrespective of the time consumed in the performance thereof.
CASE LAW/ DOCTRINE: the payment of an employee on a pakyaw basis alone is insufficient to exclude one from the coverage of SIL and holiday pay. They are only
exempted only if they qualify as Field personal Therefore the IRR validly qualifies and limits the exclusion of workers paid by results found in Art 82 from the
coverage of holiday and SIL pay. This is the only reasonable interpretation since the determination of excluded workers who are paid by results is determined by
the Sec. of Labor in appropriate regulations
FACTS:
In Jan 2009, Macasio filed a complaint against David, doing business under Yiels Hog Dealer in the LA for non-payment of overtime pay, holiday pay, and
13th month pay. He is also claiming for payment for moral and exemplary damages and attorneys fees. Along with payment for service incentive leave.
Macasio alleges that he had been working as a butcher for David since 1995. And that David exercised effective control and supervision over his work. He
pointed out that:
1.) David sets the work day, reporting time and hogs to be chopped as well as the manner by which he was to perform his work
2.) David pays him a daily salary of P700 which was increased from P600 in 2007, P500 in 2006, and P400 in 2005.
3.) David Approved/Disapproved his leaves,
4.) David owned the hogs delivered for chopping as well as the tools and implements, rented the workspace and employs about 25 butchers and deliver
drivers.
Daivd in his defense, that he only started his hog dealership in 2005 and he only has 10 employees and that he hired Macasio as a butcher on the
pakyaw basis thus not entitled to pay he is claiming in his complaint pursuant to the provisions of the IRR of the labor code. David pointed out that
Macasio:
1.) Usually starts his work at 10pm and ends at 2am the following day
2.) Received the fixed amount of P700 per engagement, regardless of the actual number of hours he spent working.
3.) He was not engaged to report for work and did not receive any fee when no hogs are delivered.
Macasio disputed Davids allegations, arguing that David did not start his business only in 2005, and pointed out the Certificate of Employment that David
issued in his favor which placed the date of his employment in January 2000. And that he reported for work every day which the payroll or time record
could have easily proved if David submitted them in evidence
David refuting Macasios further allegations asserted further that Macasio was not his employee as he hired him only on a pakyaw basis and that the
Certificate of Employment was only issued on Macasios request only for overseas employment purposes
The LA dismissed Macasios complaint and concluded that he was engaged on a pakyaw basis thus not entitled to overtime, holiday, SIL and 13 month
pay. Based on these findings:
1.) He received the fixed amount of {700 for every work done regardless of the number of hours he spent or the number of hogs he chopped.
2.) He usually worked for only 4 hours.
3.) P700 wage far exceeds the then prevailing daily minimum wage of P382
The NLRC affirmed the LAs ruling and observed that Macasio was not required to render 8 hours of work to earn the fixed P700 and that Macasio had
been working a non-time work pointing out that Macaso was paid a fixed amount for the completion of the assigned task, irrespective of the time
consumed in its performance. Since Macasio was paid by result and not in terms of the time spent He is not covered by Labor standards law.
NLRC denied MR
The CA partly granted Macasios petition for certiorari and reversed the NLRC ruling.
While the CA agreed with the LA and NLRC that Macasio was a Task Based employee, The CA found him entitled to his monetary claims following the
doctrine of Serrano v. Severino Santos Transit. The CA explained that as a Task Based employee, Macasio is excluded from the coverage of the holiday, SIL
and 13th month pay only if he is a field personnel. And as defined by the Labor Code a field personnel is one who performs the work away from the
workplace and whose regular work hours cannot be determined with reasonable certainty. In Macasios case, the elements of being a field personnel
are evidently lacking as he had been working as a butcher in Davids hog dealership under Davids supervision and control and for a fixed working
schedule that starts at 10 pm.
The CA awarded Macasios claim for holiday, SIL and 13th month pay for 3 years with 10% attorneys fees by denied his claim for moral and exemplary
damages for lack of basis.
ISSUE(S): WON Labor Law provisions on Holiday, SIL and 13th month pay is available for a worker engaged on a pakyaw or task basis.
HELD: Yes, as long as he doesnt fall under the description of a field personnel. (only HOLDIAY and SIL PAY)

The SC states that WON Macasio is entitled to the pay he is claiming, is a question of law and such is intertwined with the factual issue of the existence of an
employer-employee relationship.
David in insisting that Macasio was not his employee, states that he engaged him on a task basis. The court rejects such assertion and states that the
Engagement on a task basis does not characterize the relationship that may exist between the parties. Since the LC in Art 97(6) defines wages as
remuneration or earnings, however designated, capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, or
commission basis, or other method of calculating the same, which is payable by an employer to an employee under a written or unwritten contract of
employment for work done or to be done, or for services rendered or to be rendered. In relation to such Art. 101 of the LC speaks of workers paid by
results or those whose pay is calculated in terms of quantity or quality of their work includes pakyaw work and other non-time work.
The SC finds an employer-employee relationship exists between Macasio and David. Since he passes the 4 fold test:
1.) The is the element of selection and engagement of the employee, since David Engaged the services of Macsasio as confirmed by his Sinumpaang
Salaysay,
2.) The element of payment of wages was satisfied since both parties stated in their pleadings that David had been paying Macasio P700 each.
3.) The power to control is exercised since David sets the time and day when Macasio should report for work. Thus by having the power to control
Macasios schedule, David could regulate Macasios work and could even refuse to give him any assignment thus effectively dismissing him.
4.) The power to control and supervise is evidenced since David had control over Macasios work as to its means and methods of performing such.
Macasio is engages on a Pakyaw/ Task basis.
All 3 tribunals (LA NLRC and the CA) found that Macasio was engaged on a pakyaw basis.
A distinguishing characteristic of the Pakyaw or task basis, as opposed to the straight-hour wage payment is the non-consideration of the time spent in
work. In a task-basis work the emphasis is on the task itself, in the sense that payment is reckoned in terms of completion of the work, not in terms of
the number of time spent in the completion of work. Once the work is completed, the worker receives a fixed amount as wage w/o regard to time
spent.
In Macasios case, it is established that he would start work at 10pm and regardless of the total hours he spent or the number of hogs hes chopped. He
would receive the fixed amount of P700 once he had completed his task. Clearly these circumstance show a pakyaw or task basis.
The existence of employment between the parties is determined by the 4-fold test; the engagement of on a pakyaw basis does not determine the
parties relation as it is simply a method of pay computation. Accordingly, Macasio is Davids employee engaged on a pakyaw basis.
Entitlement to holiday, SIL and 13th month pay.
Under the provsions of the LC(NOTES)**** the general rules is that Holiday, and SIL pay cover all employees, and to be excluded from their coverage,
the employee must be one of those that the provisions expressly exempt, Under the IRR, exemption from the coverage of Holiday and SIL pay refer to
Field personnel and other employees whose time and performance is unsupervised by the employer including those who are engaged on task or
contract basis. Unlike n Art 82 of the LC, the IRR on holiday and SIL pay does not exclude employees engaged on task basis as a separate and distinct
category from employees classified as field personnel. Rather, these employees are altogether merged into 1 classification of exempted employees.
Because of this difference it may be argued that the LC may be interpreted to mean that those who are engaged on task basis, per se are excluded
from the SIL and holiday payment since this is what the LC provisions in contrast with the IRR, strongly suggest.
However in 1987 in the case of Cebu Institute of Technology vs. Ople the phrase those who are engage on task or contract basis in the rule has
already been interpreted should however, 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 follow xxx Clearly, petitioner's teaching personnel cannot be deemed field personnel which
refers "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. [Par. 3, Article 82, Labor Code of the Philippines].
Petitioner's claim that private respondents are not entitled to the service incentive leave benefit cannot therefore be sustained.
In short the payment of an employee on a pakyaw basis alone is insufficient to exclude one from the coverage of SIL and holiday pay. They are only
exempted only if they qualify as Field personal Therefore the IRR validly qualifies and limits the exclusion of workers paid by results found in Art 82
from the coverage of holiday and SIL pay. This is the only reasonable interpretation since the determination of excluded workers who are paid by
results is determined by the Sec. of Labor in appropriate regulations.
The Cebu Institute of Technology was reiterated in 2005 in Autobus Transport systems vs. Bautista. The Autobus ruling in turn was the basis of Serrano
v. Santos Transit which the CA cited in support of granting Macasios petition.
In Serrano, the Court, applying the rule on ejusdem generis declared that "employees engaged on task or contract basis xxx are not automatically
exempted from the grant of service incentive leave, unless, they fall under the classification of field personnel." The Court explained that the phrase
"including those who are engaged on task or contract basis, purely commission basis" found in Section 1(d), Rule V of Book III of the IRR should not be
understood as a separate classification of employees to which SIL shall not be granted. Rather, as with its preceding phrase - "other employees whose
performance is unsupervised by the employer" - the phrase "including those who are engaged on task or contract basis" serves to amplify the
interpretation of the Labor Code definition of "field personnel" as those "whose actual hours of work in the field cannot be determined with
reasonable certainty."
In determining whether workers engaged on pakyaw basis is entitled to holiday and SIL pay the presence of employer supervision as regards the
workers time and performance is the key if the worker is simply engaged on pakyaw basis, then the general rule is that he is entitled to a holiday pay
and SIL pay unless exempted from the exceptions specifically provided under Art 94 Art 95 of the LC. However, if the worker engaged on pakyaw or
task basis also falls within the meaning of field personnel under the law then he is not entitled to these monetary benefits.
Macasio does not fall under the classification of field personnel. Based on the definition in Art 82. The SC agrees that Macasio does not fall under the
definition of field personnel since Macasio regularly performed his duties at Davids place of business and his actual hours of work could be determined
with reasonable certainty and David supervised his time and performance thus Macasio cannot be considered a field personnel then he is not
exempted from the grant of holiday, SIL pay
However for the 13th month pay, the governing law is PD 851, 13th month pay generally covers all employees excluding those expressly enumerated to
be exempted, Under PD 851 those who are paid in a task basis are exempted, thus not entitled.

11 UNION CARBIDE LABOR UNION v. UNION CARBIDE PHILS., INC. AUTHOR: ACIDO
G.R. No. L-41314, November 13, 1992 NOTES: Petition for review
TOPIC: Change in Work Hours A Management Prerogative PONENTE: Melo, J.
CASE LAW/ DOCTRINE:
Management retained the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. And as long as such prerogative
is exercised in good faith for the advancement of the employers interest and not for the purpose of defeating or circumventing the rights of the employees under
special laws or under valid agreements, the Court will uphold such exercise.
FACTS:
Complainants Agapito Duro, Alfredo Torio, and Rustico Javillonar were dismissed from their employment after an application for clearance to terminate
them was approved by the Secretary of Labor on December 19, 1972. Respondents application for clearance was premised on willful violation of Company
regulations, gross insubordination and refusal to submit to a Company investigation. Prior events:
o Respondent Company operates on 3 shifts: morning, afternoon, night. The workers in the 3rd shift work from Monday to Saturday, the
last working day being Friday or 40 hours a week or from Monday to Friday.
o July 1972: From Monday to Friday as provided in the CBA, it became Sunday to Thursday effective July 5, 1972. 3rd shift employees
were required to start the new work schedule.
o November 6, 1972: Night shift employees filed a demand to maintain the old working schedule (M to F). The demand was referred to
the National Labor Management Relation Committee, wherein the discussions eventually resulted to an agreement that all night shift
operating personnel were allowed to start their work Monday and on Saturday; maintenance and preparation crews work schedule
is presumed to be maintained from Sunday to Thursday. The work schedule between management representatives and the alleged
officers of the Union (Varias group) was approved and disseminated to take effect November 26, 1972.
o Duro, Torio, and Javillonar did not report for work on November 26, 1972 (a Sunday) since it was not a working day according to the
provisions of the CBA. Their absence caused their suspension for 14 days.
Arbitrator: Ordered reinstatement + backwages
NLRC: Denied respondent companys appeal
Secretary of Labor: Set aside arbitrators decision; awarded complainants separation pay instead. Also denied subsequent MR by petitioner.
ISSUE:
Whether or not the complainants could be validly dismissed from their employment on the ground of insubordination for refusing to comply with the new work
schedule.
HELD:
Yes. Decision affirmed.
Petitioner alleges that the change in the companys working schedule violated the existing Collective Bargaining Agreement of the parties. Hence,
complainants cannot be dismissed since their refusal to comply with the re-scheduled working hours was based on a provision of the Collective Bargaining
Agreement.
Although Article XIX of the CBA provides for the duration of the agreement (September 1, 1971 to August 31, 1974; cannot be changed or renegotiated
before July 1, 1974), this does not necessarily mean that the company can no longer change its working schedule, for Section 2, Article II of the same CBA
expressly provides that (deleted the irrelevant MPs):
SECTION 2. In the exercise of its functions of management, the COMPANY shall have the sole and exclusive right and power, among other things, to direct
the operations and the working force of its business in all respects; xxx to schedule the hours of work, shifts and work schedules; to require work to be done
in excess of eight hours or on Sundays or holidays as the exigencies of the service may require
Management retained the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. And as long as
such prerogative is exercised in good faith for the advancement of the employers interest and not for the purpose of defeating or circumventing the
rights of the employees under special laws or under valid agreements, the Court will uphold such exercise.
Side issues, just in case
o Dismissal does not violate Section 9, Article II of the 1973 Constitution which provides the right of workers to self-organization, collective
bargaining, security of tenure and just and humane conditions of work. The incident complained of took place sometime in 1972, so there is
no violation of the 1973 Constitution to speak of because the guarantee of security of tenure embodied under Section 9, Article II may not be
given a retroactive effect.
o No unfair labor practice in this case. Neither was there gross and habitual neglect of complainants duties. Nor did the act of complainants in
refusing to follow the new working hours amount to serious misconduct or willful disobedience to the orders of respondent company.
o No serious objections may be offered to the Arbitrators conclusion to order reinstatement with backwages of the complainants, but
reinstatement is no longer feasible due to the fact that the controversy started more than 20 years ago aside from the obviously strained
relations between the parties.

12 Sime Darby Pilipinas vs. NLRC AUTHOR: ADRE


[G.R. No. 119205, April 15, 1998] NOTES: Petitioners: Sime Darby Pilipinas, Inc.
TOPIC: Change in works: A management prerogative Respondents: National Labor Relations Commission (2nd Division) and Sime
PONENTE: BELLOSILLO, J Darby Salaried Employees Association (ALU-TUCP)
ART. 100 Prohibition Against Diminution or Elimination of Benefits.
CASE LAW/ DOCTRINE: The right to fix the work schedules of the employees rests principally on their employer. The new work schedule fully complies with the daily
work period of 8 hours without violating the Labor Code.
FACTS:
Sime Darby Pilipinas, Inc., (Company) petitioner, is engaged in the manufacture of automotive tires, tubes and other rubber products. Sime Darby Salaried
Employees Association (ALU-TUCP), private respondent, is an association of monthly salaried employees of petitioner at its Marikina factory.
Prior to the present controversy, all company factory workers in Marikina including members of union worked from 7:45 a.m. to 3:45 p.m. with a 30 minute
paid on call lunch break.
14 August 1992: a memorandum was issued by the Company to all factory-based employees advising all its monthly salaried employees in its Marikina Tire
Plant, except those in the Warehouse and Quality Assurance Department working on shifts, a change in work schedule effective 14 September 1992 (check
note below for the Memo)
ALU-TUCP felt adversely affected by the change in the work schedule and discontinuance of the 30-minute paid on call lunch break, it filed on behalf of its
members a complaint with the Labor Arbiter for unfair labor practice, discrimination and evasion of liability
Labor Arbiter: DISMISSED COMPLAINT.
change in the work schedule and the elimination of the 30-minute paid lunch break constituted a valid exercise of management prerogative and that the
new work schedule did not have the effect of diminishing the benefits granted to factory workers as the working time did not exceed eight (8) hours.
o It further held that the factory workers would be justly enriched if they continued to be paid during their lunch break even if they were no
longer on call.
o He also ruled that the decision in the earlier Sime Darby case was not applicable because the former involved discrimination of certain
employees who were not paid for their 30-minute lunch break while the rest of the factory workers were paid.
ALU-TUCP: appealed to NLRC which sustained the Labor Arbiter and dismissed the appeal
MR was filed by ALU-TUCP. NLRC, with 2 new commissioners replacing those who earlier retired, reversed its earlier decision.
o It considered the decision of this Court in the Sime Darby case of 1990 as the law of the case where the Company was ordered to pay the
money value of these covered employees deprived of lunch and/or working time breaks.
o NLRC declared that the new work schedule deprived the employees of the benefits of time-honored company practice of providing its
employees a 30-minute paid lunch break resulting in an unjust diminution of company privileges prohibited by Art. 100 of the Labor Code, as
amended.
The OSG commented that the memorandum, which contained the new work schedule, was not discriminatory of the union members nor did it constitute
unfair labor practice on the part of petitioner
Hence, the Appeal.
ISSUE(S): Whether the change of work schedule, which management deems necessary to increase production, constitutes unfair labor practice
HELD: NO. The right to fix work schedule rests primarily on the employer
The right to fix the work schedules of the employees rests principally on their employer. The new work schedule fully complies with the daily work period of 8
hours without violating the Labor Code.
Companys reason for adjustment: For the efficient conduct of its business operations and its improved production.
o While the old work schedule included a 30-minute paid lunch break, the employees could be called upon to do jobs during that period as they
were on call.
o Even if denominated as lunch break, it could be considered as working time because the factory employees were required to work if necessary
and were paid accordingly for working.
The new work schedule gave the employees a one-hour lunch break without any interruption from their employer.
o For a full one-hour undisturbed lunch break, the employees can freely and effectively use this hour not only for eating but also for their rest
and comfort which are conducive to more efficiency and better performance in their work.
Since the employees are no longer required to work during this one-hour lunch break, there is no more need for them to be compensated for this period.
the new schedule applies to all employees in the factory similarly situated whether they are union members or not.
The ruling in the earlier Sime Darby case is not applicable in this case since the issue involved a matter of granting lunch breaks to certain employees while
depriving the other employees of the same.
This case does not pertain to any controversy involving discrimination of employees but only the issue of whether the change of work schedule, which
management deems necessary to increase production, constitutes unfair labor practice.
As shown by the records, the change effected by management is made to apply to all factory employees engaged in the same line of work whether or
not they are members of private respondent union.
It cannot be said that the new scheme adopted by management prejudices the right of private respondent to self-organization.

Employers are accorded the right to protect themselves and to exercise what are clearly management prerogatives.
Every business enterprise endeavors to increase its profits. It may devise means to attain that goal.
Thus, management is free to regulate, according to its own discretion and judgment, all aspects of employment, including hiring, work assignments,
working methods, time, place and manner of work, processes to be followed, supervision of workers, working regulations, transfer of employees, work
supervision, lay off of workers and discipline, dismissal and recall of workers.
Management retains the prerogative, whenever exigencies of the service so require, to change the working hours of its employees.
So long as such prerogative is exercised in good faith for the advancement of the employers interest and not for the purpose of defeating or
circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold such exercise.
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 dispute
will be automatically decided in favor of labor.
Management also has right which, as such, are entitled to respect and enforcement in the interest of simple fair play.
Memo:
TO: ALL FACTORY-BASED EMPLOYEES
RE: NEW WORK SCHEDULE
Effective Monday, September 14, 1992, the new work schedule factory office will be as follows:
7:45 A.M. 4:45 P.M. (Monday to Friday)
7:45 A.M. 11:45 P.M. (Saturday).
Coffee break time will be ten minutes only anytime between:
9:30 A.M. 10:30 A.M. and
2:30 P.M. 3:30 P.M.
Lunch break will be between:
12:00 NN 1:00 P.M. (Monday to Friday).
Excluded from the above schedule are the Warehouse and QA employees who are on shifting. Their work and break time schedules will be maintained as it is now.

13 Bisig Manggagawa sa Tryco v. National Labor Relations Commission AUTHOR: Castro


[G.R. No. 151309. October 15, 2008] NOTES:
TOPIC: Compressed work week
PONENTE: Nachura, J.
CASE LAW/ DOCTRINE:
The conditions set by the DOLE, under D.O. No. 21, to protect the interest of the employees in the implementation of a compressed workweek scheme are:
1. The employees voluntarily agree to work more than eight (8) hours a day the total in a week of which shall not exceed their normal weekly hours of
work prior to adoption of the compressed workweek arrangement;
2. There will not be any diminution whatsoever in the weekly or monthly take-home pay and fringe benefits of the employees;
3. If an employee is permitted or required to work in excess of his normal weekly hours of work prior to the adoption of the compressed workweek
scheme, all such excess hours shall be considered overtime work and shall be compensated in accordance with the provisions of the Labor Code or
applicable Collective Bargaining Agreement (CBA);
4. Appropriate waivers with respect to overtime premium pay for work performed in excess of eight (8) hours a day may be devised by the parties to the
agreement;
5. The effectivity and implementation of the new working time arrangement shall be by agreement of the parties.

FACTS:
Tryco Pharma Corporation (Tryco) is a manufacturer of veterinary medicines located in Caloocan City and Bisig Manggagawa sa Tryco (BMT) is the
exclusive bargaining representative of the rank-and-file employees.
Petitioners Joselito Lario (helper), Vivencio Barte (shipment helper), Saturnino Egera and Simplicio Aya-ay (factory workers) are regular employees
assigned to the Production Department and are members of the BMT.
Pursuant to DOLE Order (D.O.) No. 21, Series of 1990, Guidelines on the Implementation of Compressed Workweek, Tryco and the petitioners signed
separate Memoranda of Agreement (MOA), providing for a compressed workweek schedule to be implemented in the company effective May 20, 1996.
o MOA: 8:00 a.m. to 6:12 p.m., from Monday to Friday, shall be considered as the regular working hours, and no overtime pay shall be due and
payable to the employee for work rendered during those hours.
The MOA specifically stated that the employee waives the right to claim overtime pay for work rendered after 5:00 p.m. until 6:12 p.m. from Monday to
Friday considering that the compressed workweek schedule is adopted in lieu of the regular work- week schedule which also consists of 46 hours.
However, should an employee be permitted or required to work beyond 6:12 p.m., such employee shall be entitled to overtime pay.
In January 1997, BMT and Tryco negotiated for the renewal of their CBA but failed to arrive at a new agreement.
Meantime, Tryco from the Bureau of Animal Industry of the Department of Agriculture reminding it that its production should be conducted in San Rafael,
Bulacan, not in Caloocan City.
As a result, Tryco issued separate Memoranda directing petitioners to report to the companys plant site in Bulacan.
BMT opposed the transfer alleging that it constitutes unfair labor practice. In protest, BMT declared a strike.
Petitioners filed separate complaints for illegal dismissal, underpayment of wages, nonpayment of overtime pay and service incentive leave, and refusal
to bargain against Tryco and its President, Wilfredo C. Rivera.

Labor Arbiter:
1. dismissed the case for lack of merit. Labor Arbiter dismissed the case for lack of merit. The Labor Arbiter held that the transfer of the petitioners would
not paralyze or render the union ineffective for the following reasons: (1) complainants are not members of the negotiating panel; and (2) the transfer
was made pursuant to the directive of the Department of Agriculture.
2. denied the money claims, ratiocinating that the nonpayment of wages was justified because the petitioners did not render work from May 26 to 31,
1997; overtime pay is not due because of the compressed workweek agreement between the union and management; and service incentive leave
pay cannot be claimed by the complainants because they are already enjoying vacation leave with pay for at least five days.
NLRC: affirmed LAs decision.
Court of Appeals: dismissed the petition for certiorari and ruled that the transfer order was a management prerogative not amounting to a constructive dismissal
or an unfair labor practice. The CA further sustained the enforceability of the MOA, particularly the waiver of overtime pay in light of this Courts rulings
upholding a waiver of benefits in exchange of other valuable privileges.
ISSUE: Whether the MOA containing the compressed work-week scheme is unenforceable for being contrary to law
HELD: NO. The MOA is enforceable and binding against the petitioners. Where it is shown that the person making the waiver did so voluntarily, with full
understanding of what he was doing, and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as a valid and binding
undertaking.
D.O. No. 21 sanctions the waiver of overtime pay in consideration of the benefits that the employees will derive from the adoption of a compressed
workweek scheme, thus:
The compressed workweek scheme was originally conceived for establishments wishing to save on energy costs, promote greater work efficiency and lower the
rate of employee absenteeism, among others. Workers favor the scheme considering that it would mean savings on the increasing cost of transportation fares for
at least one (1) day a week; savings on meal and snack expenses; longer weekends, or an additional 52 off-days a year, that can be devoted to rest, leisure, family
responsibilities, studies and other personal matters, and that it will spare them for at least another day in a week from certain inconveniences that are the normal
incidents of employment, such as commuting to and from the workplace, travel time spent, exposure to dust and motor vehicle fumes, dressing up for work, etc.
Thus, under this scheme, the generally observed workweek of six (6) days is shortened to five (5) days but prolonging the working hours from Monday to Friday
without the employer being obliged for pay overtime premium compensation for work performed in excess of eight (8) hours on weekdays, in exchange for the
benefits above cited that will accrue to the employees.

The adoption of a compressed workweek scheme in the company will help temper any inconvenience that will be caused the petitioners by their transfer to
a farther workplace.

The MOA complied with the following conditions set by the DOLE, under D.O. No. 21, to protect the interest of the employees in the implementation of a
compressed workweek scheme:
6. The employees voluntarily agree to work more than eight (8) hours a day the total in a week of which shall not exceed their normal weekly hours of
work prior to adoption of the compressed workweek arrangement;
7. There will not be any diminution whatsoever in the weekly or monthly take-home pay and fringe benefits of the employees;
8. If an employee is permitted or required to work in excess of his normal weekly hours of work prior to the adoption of the compressed workweek
scheme, all such excess hours shall be considered overtime work and shall be compensated in accordance with the provisions of the Labor Code or
applicable Collective Bargaining Agreement (CBA);
9. Appropriate waivers with respect to overtime premium pay for work performed in excess of eight (8) hours a day may be devised by the parties to the
agreement;
10. The effectivity and implementation of the new working time arrangement shall be by agreement of the parties.

Pesala v. NLRC, cited by petitioners, is not applicable to the present case. In that case, an employment contract provided that the workday consists of 12
hours and the employee will be paid a fixed monthly salary rate that was above the legal minimum wage. However, unlike the present MOA which
specifically states that the employee waives his right to claim overtime pay for work rendered beyond eight hours, the employment contract in that case was
silent on whether overtime pay was included in the payment of the fixed monthly salary. This necessitated the interpretation by the Court as to whether the
fixed monthly rate provided under the employment contract included overtime pay. The Court noted that if the employee is paid only the minimum wage
but with overtime pay, the amount is still greater than the fixed monthly rate as provided in the employment contract. It, therefore, held that overtime pay
was not included in the agreed fixed monthly rate.
Considering that the MOA clearly states that the employee waives the payment of overtime pay in exchange of a five-day workweek, there is no room for
interpretation and its terms should be implemented as they are written.

14 PAL vs. NLRC & Dr. Fabros AUTHOR: Miguel M. Consing


[G.R. No. 132805; February 2, 1999] NOTES:
TOPIC: Work Hours Employer PAL
PONENTE: Puno, J. Employee Dr. Fabros
Nurse on Duty Eusebio

See Art. 83 of Labor Code for legal/codal basis on Work Hours


DOCTRINE:
The eight-hour work period does not include the meal break; Dr. Fabros act of going home to take his dinner does not constitute abandonment.
Not every employee who is illegally dismissed or suspended is entitled to damages. The person claiming moral damages must prove the existence of bad
faith by clear and convincing evidence for the law always presumes good faith.
FACTS:
Dr. Fabros worked for PAL as a flight surgeon, his shift was from 4 PM to 12 MN; he also lived a few minutes away from the office. On Feb. 17, 1994, Dr.
Fabros went home at around 7PM to have dinner. A few minutes later, the clinic received an emergency call one of the employees (Acosta) suffered a
heart attack. The nurse on duty, Mr. Eusebio, called Dr. Fabros at home to inform him of the emergency. Acosta arrived at the clinic at 7:50 PM and Eusebio
immediately rushed him to the hospital. Dr. Fabros arrived a minute after they had left. Acosta died the next day.
PAL investigated the incident and required Dr. Fabros to explain himself.
Dr. Fabros asserted that he was entitled to 30 min. meal break; that he immediately left his residence upon being informed about the emergency and he
arrived at the clinic a few minutes later; and that Mr. Eusebio panicked and brought Acosta to the hospital without waiting for him.
PAL charged Dr. Fabros with abandonment of post while on duty and suspended him for 3 months. Dr. Fabros then filed a complaint for illegal suspension.
LA: Dr. Fabros was illegally suspended and PAL was ordered to pay him the benefits he should have received during the period of suspension plus 500k in
moral damages.
NLRC: Affirmed above ruling
ISSUES & HELD/RATIO:
First Issue: Did Dr. Fabros abandon his post?
No, the facts do not support PALs allegation that Dr. Fabros abandoned his post. Dr. Fabros left the clinic that night only to have his dinner at his house,
which was only a few minutes drive away from the clinic. His whereabouts were known to the nurse on duty so that he could be easily reached in case of
emergency. Upon being informed of Mr. Acostas condition, Dr. Fabros immediately left his home and returned to the clinic. These facts belie petitioners
claim of abandonment.
Second Issue: Does the eight-hour work period include the meal break?
No, the eight-work work period does not include the meal break. Art. 83 of the Labor Code explicitly provides that regular work hours are exclusive of time
for meals, except for certain cases provided in the same Article which do not apply in this case.
Going back to the first issue, nowhere in the law may it be inferred that employees must take their meals within the company premises. Employees are not
prohibited from going out of the premises as long as they return to their posts on time. Therefore, Dr. Fabros act of going home to take his dinner does not
constitute abandonment.
Third Issue: Is Dr. Fabros entitled to moral damages?
No, Dr. Fabros is not entitled to moral damages. The person claiming moral damages must prove the existence of bad faith by clear and convincing
evidence for the law always presumes good faith. There is no showing that the management of PAL was moved by some evil motive in suspending Dr.
Fabros. PAL suspended Dr. Fabros on an honest, but erroneous, belief that his act of leaving the company premises to take his meal at home constituted
abandonment of post which warrants the penalty of suspension. Also, it is evident from the facts that PAL gave Dr. Fabros all the opportunity to refute the
charge against him and to defend himself. These negate the existence of bad faith on PALs part.

15 Sime Darby Pilipinas, Inc. v. NLRC, AUTHOR: De Leon


[G.R. No. Date] G.R. No. 119205, April 15, 1998
TOPIC: Regular meal period
PONENTE: BELLOSILLO, J.
CASE LAW/ DOCTRINE: Management retains the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. So
long as such prerogative is exercised in good faith for the advancement of the employer's interest and not for the purpose of defeating or circumventing the
rights of the employees under special laws or under valid agreements, this Court will uphold such exercise.
FACTS:
Sime Darby is engaged in the manufacture of automotive tires, tubes and other rubber products. Private respondent is an association of the monthly
salaried employees of the Sime Darby factory workers in Marikina. Prior to the controversy, all employees of Sime Darby worked from 7:45am to 3:45pm
with a 30-minute paid "on call" lunch break.
On August 14, 1992, the company issued a memorandum to all factory employees advising all its monthly salaried employees in Marikina Tire plant except
those in the warehouse and Quality Assurance Dept., of a change in work schedules. (M-F, 7:45am-4:45pm and Sat 7:45am-11:45am) with cofee break of
10 minutes between 9:30am-10:30am and 2:30pm-3:30pm and lunch break between 12nn-1pm(M-F). (yung dating 30min. paid lunch break naging 1hr
without pay)
Because of this memorandum, the association filed a complaint in behalf of its members a complaint with labor Arbiter for unfair labor practice,
discrimination and evasion of liability. However, the labor arbiter dismissed the complaint on the grounds that the elimination of the 30 minute paid lunch
break constituted a valid exercise of management prerogative and that the new work schedule did not have the effect of dimishing the benefits for the
work did not exceed 8 hours.
NLRC affirmed the LA, but on MR (bago na yung commissioners) reversed LA.
declared that the new work schedule deprived the employees of the benefits of a time-honored company practice of providing its employees a 30-minute
paid lunch break resulting in an unjust diminution of company privileges prohibited by Art. 100 of the Labor Code, as amended.
ISSUE(S): W/N the change in schedule is valid
HELD: Yes
The right to fix the work schedules of the employees rests principally on their employer. In the instant case petitioner, as the employer, cites as reason for
the adjustment the efficient conduct of its business operations and its improved production.
The case before us does not pertain to any controversy involving discrimination of employees (yung previous sime darby case kasi about sa discrimination)
but only the issue of whether the change of work schedule, which management deems necessary to increase production, constitutes unfair labor practice.
As shown by the records, the change effected by management with regard to working time is made to apply to all factory employees engaged in the same
line of work whether or not they are members of private respondent union. Hence, it cannot be said that the new scheme adopted by management
prejudices the right of private respondent to self-organization.
Management is free to regulate, according to its own discretion and judgment, all aspects of employment, including hiring, work assignments, working
methods, time, place and manner of work, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision,
lay off of workers and discipline, dismissal and recall of workers. Further, management retains the prerogative, whenever exigencies of the service so
require, to change the working hours of its employees. So long as such prerogative is exercised in good faith for the advancement of the employer's
interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will
uphold such exercise.

16 Arica v. NLRC AUTHOR: Delfin


[G.R. No. 78210 February 28, 1989] NOTES:
TOPIC: Hours of Work (Waiting Time) PLEASE READ!!
PONENTE: Paras 1. Yung significant difference between the two cases is that on the first, they alleged 30 minute waiting time
for roll call. The second case, roll call plus others (see below)
2. Hindi na tlga nagrule yung court on this petition for review on the substantive part, it only ruled on the
procedural (res judicata) but since our topic is waiting time. I included that part na din, in case matanong.
So you ruling on the substantial part is from the first case. FYI
CASE LAW/ DOCTRINE:
The thirty (30)-minute assembly time long practiced and institutionalized by mutual consent of the parties under Article IV, Section 3, of the Collective
Bargaining Agreement cannot be considered as waiting time within the purview of Section 5, Rule I, Book III of the Rules and Regulations
Implementing the Labor Code.

SECTION 5. Waiting time. (a) Waiting time spent by an employee shall be considered as working time if waiting is an integral part of his work or the employee
is required or engaged by the employer to wait. (example: drivers)
FACTS:
Petitioners Arica et al contends that the preliminary activities as workers of STANFILCO in the assembly area is compensable as working time (from
5:30 to 6:00 o'clock in the morning) since these preliminary activities are necessarily and primarily for private respondent's benefit. The activities
takes approx. 30 minutes and they are as follows:
(a) First there is the roll call. This is followed by getting their individual work assignments from the foreman.
(b) Thereafter, they are individually required to accomplish the Laborer's Daily Accomplishment Report during which they are often made to explain about their
reported accomplishment the following day.
(c) Then they go to the stockroom to get the working materials, tools and equipment.
(d) Lastly, they travel to the field bringing with them their tools, equipment and materials.
On the respondents side, STANFILCO avers that this complaint is not new, the very same claim having been brought against them by the same group
of rank and file employees in the case of Associated Labor Union and Standard Fruit Corporation. In the first complaint, they allege that 30 minutes
prior to the start of their scheduled working hours "to ascertain the work force available for the day by means of a roll call is waiting time and
should be compensable.
The Minister of Labor held in that first case that the thirty (30)-minute assembly time is long practiced and institutionalized by mutual consent of the
parties under Article IV, Section 3, of the Collective Bargaining Agreement and cannot be considered as waiting time within the purview of Section 5,
Rule I, Book III of the Rules and Regulations Implementing the Labor Code.
For this reason, Standard Fruit contends that the action is barred by res judicata.
Labor Arbiter ruled for STANFILCO and dismissed the case because of res judicata.
Petitioner appealed with the NLRC and upheld the dismissal. Petitioner filed an MR which was denied. Hence this petition for certiorari.

ISSUE:
1) Whether or not the 30-minute activity of the petitioners before the scheduled working time is compensable under the Labor Code?
2) Whether or not res judicata applies when the facts obtaining in the prior case and in the case at bar are significantly different from each other in that there is
merit in the case at bar?
HELD:
1) NO, it is not compensable under the Labor Code (not considered as waiting time)
2) Yes, res judicata applies. There is no difference in the facts.
FIRST ISSUE:
The court held that thirty (30)-minute assembly is a deeply- rooted, routinary practice of the employees, and the proceedings attendant thereto are
not infected with complexities as to deprive the workers the time to attend to other personal pursuits. They are not new employees as to require the
company to deliver long briefings regarding their respective work assignments. Their houses are situated right on the area where the farm are
located, such that after the roll call, which does not necessarily require the personal presence, they can go back to their houses to attend to some
chores. In short, they are not subject to the absolute control of the company during this period, otherwise, their failure to report in the assembly time
would justify the company to impose disciplinary measures. The CBA does not contain any provision to this effect; the record is also bare of any proof
on this point. This, therefore, demonstrates the indubitable fact that the thirty (30)-minute assembly time was not primarily intended for the interests
of the employer, but ultimately for the employees to indicate their availability or non-availability for work during every working day.
SECOND ISSUE:
It is clear that herein petitioners are merely reiterating the very same claim which they filed through the ALU and which records show had already
long been considered terminated and closed by this Court in G.R. No. L-48510. Therefore, the NLRC can not be faulted for ruling that petitioners' claim
is already barred by res-judicata.
As aptly observed by the Solicitor General that this petition is "clearly violative of the familiar principle of res judicata. There will be no end to this
controversy if the light of the Minister of Labor's decision dated May 12, 1979 that had long acquired the character of finality and which already
resolved that petitioners' thirty (30)-minute assembly time is not compensable, the same issue can be re-litigated again."
that res judicata operates to bar not only the relitigation in a subsequent action of the issues squarely raised, passed upon and adjudicated in the first
suit, but also the ventilation in said subsequent suit of any other issue which could have been raised in the first but was not. The law provides that
'the judgment or order is, with respect to the matter directly adjudged or as to any other matter that could have been raised in relation thereto,
conclusive between the parties and their successors in interest by title subsequent to the commencement of the action .. litigating for the same thing
and in the same capacity.' So, even if new causes of action are asserted in the second action (e.g. fraud, deceit, undue machinations in connection
with their execution of the convenio de transaccion), this would not preclude the operation of the doctrine of res judicata. Those issues are also
barred, even if not passed upon in the first. They could have been, but were not, there raised.

17 University of Pangasinan Faculty Union v Unversity of Pangasinan and NLRC [G.R. No. L-63122 February 20, 1984] AUTHOR: Enriquez
TOPIC: HOURS OF WORK; Inactive due to work interruptions PONENTE: Gutierrez NOTES:
CASE LAW/ DOCTRINE: The semestral break scheduled is an interruption beyond petitioners control and it cannot be used "effectively nor gainfully in the
employees interest. Thus, the semestral break may also be considered as "hours worked." For this, the teachers are paid regular salaries and, for this, they
should be entitled to ECOLA. Not only do the teachers continue to work during this short recess but much less do they cease to live for which the cost of living
allowance is intended.
FACTS:
University of Pangasinan Faculty Union (Union) is a labor union composed of faculty members of the respondent University of Pangasinan (University).
The Unions members are full-time professors, instructors, and teachers of the University. The teachers in the college level teach for a normal duration of ten
(10) months a school year, divided into two (2) semesters of five (5) months each, excluding the two (2) months summer vacation. These teachers are paid
their salaries on a regular monthly basis.
In November and December, 1981, the Unions members were fully paid their regular monthly salaries. However, from November 7 to December 5, during
the semestral break, they were not paid their Emergency Cost of Living Allowances (ECOLA). The University claims that the teachers are not entitled thereto
because the semestral break is not an integral part of the school year and there being no actual services rendered by the teachers during said period, the
principle of "No work, no pay" applies.
Aside from their regular loads, some of the Unions members were given extra loads to handle during the same 1981-1982 schoolyear. Some of them had
extra loads to teach on September 21, 1981, but they were unable to teach as classes in all levels throughout the country were suspended, although said
days was proclaimed by the President of the Philippines as a working holiday. Those with extra loads to teach on said day claimed they were not paid their
salaries for those loads, but the University claims otherwise.
Thus, the Union, through its President, filed a complaint against the University with the Arbitration Branch of the NLRC in Dagupan City seeking payment of
the ECOLA.
ISSUE(S): Whether the Unions members are entitled to ECOLA during the semestral break
HELD: Yes.
Various Presidential Decrees on ECOLAs to wit: PDs 1614, 1634, 1678 and 1713, provide:

On Allowances of Fulltime Employees: that "Employees shall be paid in full the required monthly allowance regardless of the number of their regular working days
if they incur no absences during the month. If they incur absences without pay, the amounts corresponding to the absences may be deducted from the monthly
allowance "; and

On "Leave of Absence Without Pay": that "All covered employees shall be entitled to the allowance provided herein when they are on leave of absence with pay."

It is beyond dispute that the Unions members are full-time employees receiving their monthly salaries irrespective of the number of working days or teaching
hours in a month. However, they find themselves in a most peculiar situation whereby they are forced to go on leave during semestral breaks. These semestral
breaks are in the nature of work interruptions beyond the employees control. The duration of the semestral break varies from year to year dependent on a
variety of circumstances affecting at times only the University but at other times all educational institutions in the country. As such, these breaks cannot be
considered as absences within the meaning of the law for which deductions may be made from monthly allowances.

The "No work, no pay" principle does not apply in the instant case. The Unions members received their regular salaries during this period. It is clear from the
aforequoted provision of law that it contemplates a "no work" situation where the employees voluntarily absent themselves.

The Union members, in the case at bar, certainly do not, voluntarily, absent themselves during semestral breaks. Rather, they are constrained to take mandatory
leave from work. For this they cannot be faulted nor can they be begrudged that which is due them under the law. To a certain extent, the University can specify
dates when no classes would be held. Surely, it was not the intention of the framers of the law to allow employers to withhold employee benefits by the simple
expedient of unilaterally imposing "no work" days and consequently avoiding compliance with the mandate of the law for those days.

Furthermore, the Universitys contention that "the fact of receiving a salary alone should not be the basis of receiving ECOLA", is without merit. Since the
Implementing Rules and Regulations of Wage Order No. 1 to wit:

SECTION 5. Allowance for Unworked Days.

"a) All covered employees whether paid on a monthly or daily basis shall be entitled to their daily living allowance when they are paid their basic wage."
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This provision refutes the above contention. It is evident that the intention of the law is to grant ECOLA upon the payment of basic wages. Hence, we have the
principle of "No pay, no ECOLA" the converse of which finds application in the case at bar.
The Union cannot be considered to be on leave without pay so as not to be entitled to ECOLA, for the Union members were paid their wages in full for the months
of November and December of 1981, notwithstanding the intervening semestral break.
This, in itself, is a tacit recognition of the rather unusual state of affairs in which teachers find themselves. Although said to be on forced leave, professors and
teachers are, nevertheless, burdened with the task of working during a period of time supposedly available for rest and private matters. There are papers to
correct, students to evaluate, deadlines to meet, and periods within which to submit grading reports.
Although they may be considered by the respondent to be on leave, the semestral break could not be used effectively for the teachers own purposes for the
nature of a teachers job imposes upon him further duties which must be done during the said period of time. Learning is a never ending process. Teachers and
professors must keep abreast of developments all the time. Teachers cannot also wait for the opening of the next semester to begin their work. Arduous
preparation is necessary for the delicate task of educating our children. Teaching involves not only an application of skill and an imparting of knowledge, but a
responsibility which entails self dedication and sacrifice. The task of teaching ends not with the perceptible efforts of the petitioners members but goes beyond
the classroom: a continuum where only the visible labor is relieved by academic intermissions. It would be most unfair for the private respondent to consider
these teachers as employees on leave without pay to suit its purposes and, yet, in the meantime, continue availing of their services as they prepare for the next
semester or complete all of the last semesters requirements.
Lastly, we may also by analogy apply the principle enunciated in the Omnibus Rules Implementing the Labor Code to wit:ha
nrob1es virtual 1aw library
Sec. 4. Principles in Determining Hours Worked. The following general principles shall govern in determining whether the time spent by an employee is
considered hours worked for purposes of this Rule:
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"(d) The time during which an employee is inactive by reason of interruptions in his work beyond his control shall be considered time either if the imminence of the
resumption of work requires the employees presence at the place of work or if the interval is too brief to be utilized effectively and gainfully in the employees own
interest." (Emphasis supplied).
The Unions members in the case at bar, are exactly in such a situation. The semestral break scheduled is an interruption beyond petitioners control and it cannot
be used "effectively nor gainfully in the employees interest. Thus, the semestral break may also be considered as "hours worked." For this, the teachers are paid
regular salaries and, for this, they should be entitled to ECOLA. Not only do the teachers continue to work during this short recess but much less do they cease to
live for which the cost of living allowance is intended.
The legal principles of "No work, no pay; No pay, no ECOLA" must necessarily give way to the purpose of the law to augment the income of employees to enable
them to cope with the harsh living conditions brought about by inflation; and to protect employees and their wages against the ravages brought by these
conditions. Significantly, it is the commitment of the State to protect labor and to provide means by which the difficulties faced by the working force may best be
alleviated. To submit to the Universitys interpretation of the no work, no pay policy is to defeat this noble purpose. The Constitution and the law mandate
otherwise.

18 Durabuilt Recapping Plant & Co. vs. NLRC AUTHOR: Garcia


[G.R. No. L-76746 July 27, 1987] NOTES:
TOPIC: Inactive due to work interruption
PONENTE: Gutierrez, Jr., J
CASE LAW/ DOCTRINE:
The general principle is that an employee is entitled to receive as backwages all the amounts he may have lost starting from the date of his dismissal up
to the time of his reinstatement.
It is not fair nor just to allow a worker to recover something he has not earned and could not have earned; Backwages should be computed based on
daily rather than on monthly pay schedules.
FACTS:
A complaint for illegal dismissal was filed by respondent Reynaldo Bodegas, against petitioner Durabuilt, a tire recapping company.
Labor Arbiter: Bodegas was ordered reinstated to his former position with full backwages, from the time he was terminated up to the time he is actually
reinstated, without loss of seniority rights and benefits accruing to him.
Acting Chief of Research and Information and the Corporation Auditing Examiner of the then Ministry of Labor and Employment submitted a computation
of backwages, ECOLA, 13th month pay, sick and vacation leave benefits in favor of Bodegas in the total amount of P24,316.38
Durabuilt filed its opposition to the computation on the ground that it contemplated a straight computation of 26 working days in one month when the
period covered by the computation was intermittently interrupted due to frequent brownouts and machine trouble.
Labor Arbiter denied the opposition. NLRC affirmed the order of the Labor Arbiter.
ISSUE(S): Whether or not the backwages was computed properly
HELD: NO.
The general principle is that an employee is entitled to receive as backwages all the amounts he may have lost starting from the date of his dismissal up
to the time of his reinstatement.
To fix the amount of backwages without qualification or deduction simply means that the workers are to be paid their backwages fixed as of the time
of their dismissal or strike without deduction for their earnings elsewhere during their layoff and without qualification of their backwages as thus fixed.
There was chronic electrical power interruption resulting to disruption of business operations. To alleviate the situation, the government thru the
Ministry of Trade and Industry called on the industrial sector to resort to the so called Voluntary Loan Curtailment Plan (VLCP) brownouts or electrical
power interruption was scheduled by area.
Durabuilt participated in the VLC. Beginning March 21, 1983 and every Wednesday thereafter, Durabuilts business was not in actual operation.
Policy Instruction No. 36
o Brownouts running for more than 20 minutes may not be treated as hours worked provided that any of the following conditions are
present;
The employees can leave their work place or go elsewhere whether within or without the work premises; or
The employees can use the time effectively for their own interest.
It is of record that during electrical power interruptions, Durabuilts business was not in operation.
The payrolls submitted to support Durabuilts objection to computation indicate that the number of working days was reduced from the normal 60
days to four working days for great number of petitioners workers.
Thus, we held that where the failure of workers to work was not due to the employers fault, the burden of economic loss suffered by the employees
should not be shifted to the employer. Each party must bear his own loss.
It would neither be fair nor just to allow respondent to recover something he has not earned and could not have earned and to further penalize
Durabuilt over and above the losses it had suffered due to lack of raw materials and the energy saving programs of the government.
The computation of backwages should be based on daily rather than on monthly pay schedules where, as in the case at bar, such basis is more realistic
and accurate.

19 Hilario Rada vs. NLRC and PHILNOR Consultants and Planners Inc. [G.R. No.96078, Januaray 9, 1992] AUTHOR: Ignacio
TOPIC: Travel Time PONENTE: Regalado NOTES:
CASE LAW/ DOCTRINE: Since the assigned task of fetching and delivering employees is indispensable and consequently mandatory, then the time required of and
used by petitioner in going from his residence to the field office and back, that is, from 5:30 a.m. to 7:00 a.m. and from 4:00 p.m. to around 6:00 p.m., which the
labor arbiter rounded off as averaging three hours each working day, should be paid as overtime work.
FACTS:
Hilario Rada (petitioner) was hired as "Driver" by PHILNOR Inc. for the construction supervision phase of the Manila North Expressway Extension, Second
Stage (hereinafter referred to as MNEE Stage 2) for a term of "about 24 months effective July 1, 1977. Contract stated that Radas employment shall
automatically, and without notice, terminate upon the completion of the phase of the project; and that it is further understood that the engagement of
his/her services is coterminus with the same and not with the whole project or other phases thereof wherein other employees of similar position as he/she
have been hired.
Petitioner's first contract of employment expired. Meanwhile, the main project, MNEE Stage 2, was not finished on account of various constraints, and the
same was extended and remained in progress beyond the original period of 2.3 years. Since Petitioner had the necessary experience and his performance
under the first contract of employment was found satisfactory, the position of Driver was offered again to Petitioner, which he accepted. Hence a second
Contract of Employment for a Definite Period of 10 months.
In March 1980 some of the areas or phases of the project were completed, but the bulk of the project was yet to be finished. PHILNOR renewed his contract
of employment again. This third contract of employment was subsequently extended for a number of times, the last extension being for a period of 3
months. The last extension, from October 1, 1985 to December 31, 1985 was not extended any further because Petitioner had no more work to do in the
project.
Rada filed before the NLRC, National Capital Region, Department of Labor and Employment, a Complaint alleging that he was illegally dismissed and that he
was not paid overtime pay although he was made to render three hours overtime work form Monday to Saturday for a period of three years.
Rada Contentions: That he was a regular employee pursuant to Article 278(c) of the Labor Code and, thus, he cannot be terminated except for a just cause.
That he was an administrative employee working as a company driver, which position still exists and is essential to the conduct of the business of Philnor
even after the completion of his contract of employment. That he is also entitled to overtime pay that he rendered from Monday to Saturday for a period of
three years.
PHILNOR: Rada was a project employee and he was not entitled to termination pay since his employment was coterminous with the completion of the
project. That Rada was not a company driver since his job was to drive the employees hired to work at the MNEE Stage 2 Project to and from the filed office
at Sto. Domingo Interchange, Pampanga; that the office hours observed in the project were from 7:00 a.m. to 4:00 p.m. Mondays through Saturdays; that
Philnor adopted the policy of allowing certain employees, to bring home project vehicles to afford fast and free transportation to and from the project field
office considering the distance between the project site and the employees' residence, to avoid project delays and inefficiency due to employee tardiness
caused by transportation problem; that petitioner was allowed to use a project vehicle which he used to pick up and drop off some ten employees along
EDSA, on his way home to Marikina, Metro Manila; that when he was absent or on leave, another employee living in Metro Manila used the same vehicle in
transporting the same employees; that the time used by petitioner to and from his residence to the project site from 5:30 a.m. to 7:00 a.m. and from 4:00
p.m. to 6:00 p.m., or about three hours daily, was not overtime work as he was merely enjoying the benefit and convenience of free transportation provided
by Philnor, otherwise without such vehicle he would have used at least four hours by using public transportation and spent P12.00 daily fare.
LA: ruled in favor of Rada ordered him reinstated and payment of OT pay.
NLRC: Reversed.
ISSUE(S):
WoN petitioner Rada is a regular employee and thus entitled to termination pay - NO
WoN petitioner Rada is entitled to overtime pay - YES
HELD: Yes. Petition is denied. Rada lost but he was given overtime pay.
Petitioner Rada is not a regular employee but a project employee:
It must be stressed herein that although petitioner worked with Philnor as a driver for eight years, the fact that his services were rendered only for a
particular project which took that same period of time to complete categorizes him as a project employee. Petitioner was employed for one specific project.
A non-project employee is different in that the employee is hired for more than one project. Petitioner is a project employee considering that he does not
belong to a "work pool" from which the company would draw workers for assignment to other projects at its discretion. It is likewise apparent from the facts
obtaining herein that petitioner was utilized only for one particular project, the MNEE Stage 2 Project of respondent company. Hence, the termination of
herein petitioner is valid by reason of the completion of the project and the expiration of his employment contract. It would be extremely burdensome for
their employer who, like them, depends on the availability of projects, if it would have to carry them as permanent employees and pay them wages even if
there are no projects for them to work on.
Travel Time of Rada considered as part of his rendered working hours thus entitling him to overtime pay (TOPIC):
The fact that petitioner Rada picks up employees of Philnor at certain specified points along EDSA in going to the project site and drops them off at the same
points on his way back from the field office going home to Marikina, Metro Manila is not merely incidental to petitioner's job as a driver. On the contrary,
said transportation arrangement had been adopted, not so much for the convenience of the employees, but primarily for the benefit of the employer, herein
private respondent PHILNOR.
Private respondent does not hesitate to admit that it is usually the project driver who is tasked with picking up or dropping off his fellow employees. Proof
thereof is the undisputed fact that when petitioner is absent, another driver is supposed to replace him and drive the vehicle and likewise pick up and/or
drop off the other employees at the designated points on EDSA. If driving these employees to and from the project site is not really part of petitioner's job,
then there would have been no need to find a replacement driver to fetch these employees. But since the assigned task of fetching and delivering employees
is indispensable and consequently mandatory, then the time required of and used by petitioner in going from his residence to the field office and back, that
is, from 5:30 a.m. to 7:00 a.m. and from 4:00 p.m. to around 6:00 p.m., which the labor arbiter rounded off as averaging three hours each working day,
should be paid as overtime work. Quintessentially, petitioner should be given overtime pay for the three excess hours of work performed during working
days from January, 1983 to December, 1985.

20 UNIVERSITY OF PANGASINAN FACULTY UNION, Petitioner, v. UNIVERSITY OF PANGASINAN And NATIONAL LABOR AUTHOR: LAURETA
RELATIONS COMMISSION, Respondents. [G.R. No. L-63122. February 20, 1984.] NOTES:
TOPIC: No Work, No Pay principle PONENTE: GUTIERREZ, JR., Focus on topic
CASE LAW/ DOCTRINE:
The "No work, no pay" it contemplates a "no work" situation where the employees voluntarily absent themselves. Petitioners, in the case at bar, certainly do
not, ad voluntatem, absent themselves during semestral breaks. Rather, they are constrained to take mandatory leave from work. For this they cannot be
faulted nor can they be begrudged that which is due them under the law.
The legal principles of "No work, no pay; No pay, no ECOLA" must necessarily give way to the purpose of the law to augment the income of employees to
enable them to cope with the harsh living conditions brought about by inflation; and to protect employees and their wages against the ravages brought by
these conditions. Significantly, it is the commitment of the State to protect labor and to provide means by which the difficulties faced by the working force
may best be alleviated.
FACTS:
The petitioners members are full-time professors, instructors, and teachers of respondent University.
The teachers in the college level teach for a normal duration of ten (10) months a school year, divided into two (2) semesters of five (5) months each,
excluding the two (2) months summer vacation. These teachers are paid their salaries on a regular monthly basis.
In November and December, 1981, the petitioners members were fully paid their regular monthly salaries.
However, from November 7 to December 5, during the semestral break, they were not paid their ECOLA.
The private respondent claims that the teachers are not entitled thereto because the semestral break is not an integral part of the school year and there
being no actual services rendered by the teachers during said period, the principle of "No work, no pay" applies.
Respondent is authorized by the Ministry of Education and Culture to collect, 15% percent increase of tuition fees.
Petitioners members demanded a salary increase effective the first semester of said schoolyear to be taken from the sixty (60%) percent incremental
proceeds of the increased tuition fees.
While the complaint was pending in the arbitration branch, the private respondent granted an across-the-board salary increase of 5.86%.
Nonetheless, the petitioner is still pursuing full distribution of the 60% of the incremental proceeds as mandated by the Presidential Decree No. 451.
Aside from their regular loads, some of petitioners members were given extra loads to handle during the same 1981-1982 schoolyear. Those who had extra
loads were unable to teach as classes in all levels throughout the country were suspended, although said days was proclaimed by the President of the
Philippines as a working holiday.
The petitioner, through its President, Abad, filed a complaint against the private respondent with the Arbitration Branch of the NLRC Dagupan City. The complaint
seeks: (a) the payment of Emergency Cost of Living Allowances (ECOLA) for November 7 to December 5, 1981, a semestral break; (b) salary increases from the
sixty (60%) percent of the incremental proceeds of increased tuition fees; and (c) payment of salaries for suspended extra loads.

Petition for certiorari. (No mention of the decision)


ISSUE(S): W/N The principle of no work, no pay applies? No
HELD: GRANTED. The private respondent is ordered to pay its regular fulltime teachers/employees emergency cost of living allowances for the semestral break
from November 7 to December 5, 1981 and the undistributed balance of the sixty (60%) percent incremental proceeds from tuition increases for the same
schoolyear as outlined above. The respondent Commission is sustained insofar as it DENIED the payment of salaries for the suspended extra loads on September
21, 1981.
The various Presidential Decrees on ECOLAs to wit: PDs 1614, 1634, 1678 and 1713, provide on "Allowances of Fulltime Employees . . ." that "Employees shall be
paid in full the required monthly allowance regardless of the number of their regular working days if they incur no absences during the month. If they incur
absences without pay, the amounts corresponding to the absences may be deducted from the monthly allowance; and on "Leave of Absence Without Pay", that
"All covered employees shall be entitled to the allowance provided herein when they are on leave of absence with pay."cralaw virtua1aw library
Petitioners are full time employees
These semestral breaks are in the nature of work interruptions beyond the employees control.
As such, these breaks cannot be considered as absences within the meaning of the law for which deductions may be made from monthly allowances.
The "No work, no pay" principle does not apply in the instant case. It is clear from the aforequoted provision of law that it contemplates a "no work"
situation where the employees voluntarily absent themselves.
Petitioners, in the case at bar, certainly do not, ad voluntatem, absent themselves during semestral breaks. Rather, they are constrained to take
mandatory leave from work. For this they cannot be faulted nor can they be begrudged that which is due them under the law.
Respondents contention that "the fact of receiving a salary alone should not be the basis of receiving ECOLA", is, likewise, without merit. Particular attention is
brought to the Implementing Rules and Regulations of Wage Order No. 1 to wit.
SECTION 5. Allowance for Unworked Days.
a) All covered employees whether paid on a monthly or daily basis shall be entitled to their daily living allowance when they are paid their basic wage.
Petitioners cannot be considered to be on leave without pay so as not to be entitled to ECOLA, for, as earlier stated, the petitioners were paid their
wages in full for the months of November and December of 1981, notwithstanding the intervening semestral break.
There are papers to correct, students to evaluate, deadlines to meet, and periods within which to submit grading reports. Although they may be
considered by the respondent to be on leave, the semestral break could not be used effectively for the teachers own purposes for the nature of a
teachers job imposes upon him further duties which must be done during the said period of time.
Furthermore, we may also by analogy apply the principle enunciated in the Omnibus Rules Implementing the Labor Code to wit: Principles in Determining Hours
Worked:
"(d) The time during which an employee is inactive by reason of interruptions in his work beyond his control shall be considered time either if the
imminence of the resumption of work requires the employees presence at the place of work or if the interval is too brief to be utilized effectively and
gainfully in the employees own interest."
The semestral break scheduled is an interruption beyond petitioners control and it cannot be used "effectively nor gainfully in the employees
interest. Thus, the semestral break may also be considered as "hours worked." For this, the teachers are paid regular salaries and, for this, they should
be entitled to ECOLA.
The legal principles of "No work, no pay; No pay, no ECOLA" must necessarily give way to the purpose of the law to augment the income of employees
to enable them to cope with the harsh living conditions brought about by inflation; and to protect employees and their wages against the ravages
brought by these conditions. Significantly, it is the commitment of the State to protect labor and to provide means by which the difficulties faced by the
working force may best be alleviated.

21.) RAMON PRIETO, PACIFICO CANILLO, and WILFREDO AZUELA, petitioners, AUTHOR: PELAYO
vs. NATIONAL LABOR RELATIONS COMMISSION, AR and SONS NOTES:
INTERNATIONAL DEVELOPMENT CORP., SAUDI SERVICES and OPERATING The court invoked Art. 279 of the Labor Code Security of Tenure when they
COMPANY, LTD., and SAUDI ARABIAN MORRISON, respondents. were talking about the Private Respondents third Argument about No EE-ER
G.R. No. 93699 September 10, 1993 relationship.
PONENTE: CRUZ, J.
TOPIC: No work, No Pay
Doctrine: The principle of "no work, no pay" does not apply. The fact that the complainants had not worked at the jobsite was not of their own doing. If they were
not able to work at all, it was because they refused to sign the third contract providing for another lowering of their salaries in violation of their first agreement as
approved by the POEA.

EMERGENCY:
FACTS: Petitioners naloko ng agency. Una na deploy sila kay SSOC na okay na sana pero na coerced sila mag sign ng isa pang contract kay SAM na binaba yung pay
nila tas pag dating nila ng Jeddah aba aba napunta sila kay Muhammad Abbas so ayun assistant cook nalang. Ayaw nila mag trabaho dahil ang baba ng sweldo.
ISSUE: Nag aaply ba si No work no pay principle?
HELD: Deins kasi kasalanan naman ni Agency and Employers bakit sila di nag tatrabaho.
FACTS:
Petitioners filed a complaint against Private Respondents for non-payment of wages, illegal dismissal, illegal exaction of placement fees, illegal imposition of
performance bond, substitution of contract and deployment of workers to an unaccredited principal.
They were allegedly recruited by AR and Sons for employment for a period of 24 months with Saudi Services and Operating Co., Ltd. (SSOC) in Saudi Arabia.
The corresponding Agency Worker Agreements, which were duly approved by the POEA, provided for their respective positions and salaries as follows:
Name Position Salary (per month in US Dollars) Prieto Mechanic A/C $370.00; Azuela Mechanic A/C $370.00; Canillo Clerk $420.00
Taking advantage of their need to work, AR and Sons coerced them into signing another employment contract with Saudi Arabia Morrison (SAM) without the
knowledge and approval of the POEA. The second contract all were given lower positions (assistant cook); salary of SR625.00 per month for a period of
three years.
When they reached Jeddah, Saudi Arabia, in November 1987, they were asked to sign another employment contract by Muhammad Abbas, a representative
of SAM, which lowered their salaries AGAIN (SR250.00 a month). When they refused, they were not assigned any work but were confined in a small room in
a villa and given spoiled food for their sustenance. On December 22, 1987, they were summarily dismissed and repatriated to the Philippines
RESPONDENTS denied the charges and said that the complainants entered separate uniform Agency Worker Agreements where it was stipulated that they
would be employed by SSOC for 24 months upon departure from the Philippines. When the petitioners arrived in Jeddah, it was discovered that Prieto and
Azuela were not qualified as mechanics and that Canillo was not qualified as clerk, so all three of them were rejected. The complainants then requested
SSOC to help them secure employment as assistant cooks with SAM, which at that time was also a foreign principal of AR and Sons. Taking pity on them,
SSOC referred them to the latter agency but they also failed to pass the trade tests for assistant cooks. It was for this reason that they were finally
repatriated to the Philippines at the expense of the latter agency.
POEA favor of the Complainants.
NLRC Reversed. Dismissed.
NLRC found that the complainants had misrepresented themselves as mechanics and cooks when they were not qualified for these positions and so had only
themselves to blame if they were subsequently rejected by a foreign employer.

ISSUE(S):
WON the POEA or the NLRC was correct.
WON No work, no pay principle applies in the Case.
HELD:
POEA and NO.
RATIO:
(NOT THE MAIN ISSUE PERO BAKA MAG TANONG) Arguments of Private Respondents:
1.) Petitioners' services were terminated because they were not qualified either as mechanics or as assistant cooks.
o No merit. It is presumed that the petitioners were subjected to the trade tests required by law to be conducted by the recruiting agency to insure
employment of only technically qualified workers for the foreign principal. There was no misrepresentation on the part of the petitioners. They
had applied as A/C mechanics and clerk, and we may assume that the trade tests conducted on them were for these positions and not for the
position of assistant cook. If they fell short of the employer's expectations, the fault lies not with the petitioners but with the recruiting agency for
deploying them even if they did not possess the skills necessary for the positions they were seeking.
2.) It was stated in the petitioners complaint that they were mere assistant cooks and argue that this belies their representation that they did not apply for
these positions.
o The argument has no merit. The petitioners were not assisted by lawyers when they filed their complaint and must have had in mind the
positions stipulated in the second contract. In the amended complaint, this statement was rectified. At any rate, the slight error must not be
taken against the petitioners.
3.) No employer-employee relationship between the parties.
o Where the employer-employee relationship has been established, the burden of proof in termination cases lies with the employer. This burden
was not discharged by the private respondents. The record shows that the petitioners became employees of SSOC and later of SAM, both entities
being represented by AR and Sons, which admitted in its Comment that the petitioners were "hired and deployed abroad . . ." This relationship is
even more firmly supported by the Agency Worker Agreements between the petitioners and AR and Sons acting for SSOC which were approved
by the POEA under Accreditation Certificate No 8181, and by the second contract under which the petitioners were deployed to SAM, its other
principal, by AR and Sons.
It is clear from the record that the petitioners were hired as mechanics and clerk (or as assistant cooks under the second contract) after presumably
having passed the corresponding trade tests conducted by the recruiting agency prior to their deployment. If AR and Sons felt they were not qualified
for these positions, it should have rejected their applications outright instead of accepting their recruitment fees just the same and assuring them that
their employment had already been approved by the foreign principal. It was the fault of AR and Sons for holding the petitioners to its foreign principal
as qualified when they were found later to be deficient. Because of its negligence, if not its deliberate misrepresentation, the petitioners found
themselves stranded in a foreign land, without the employment and income that they hoped would give them a better life.

(MAIN ISSUE) The principle of "no work, no pay" does not apply.
The fact that the complainants had not worked at the jobsite was not of their own doing. If they were not able to work at all, it was because they refused to
sign the third contract providing for another lowering of their salaries in violation of their first agreement as approved by the POEA. They had a right to insist
on the higher salaries agreed upon in the original contract and to reject the subsequent impositions of SAM, which obviously thought the petitioners would
have to accept because they had no choice.
Rule V, Book I of the Omnibus Rules Implementing the Labor Code defines the duties and obligations of a duly licensed placement and recruitment agency.
o Section 2(e) requires a private employment agency to assume all responsibilities for the implementation of the contract of employment of an
overseas worker.
o Section 10(a) (2) provides that a private employment agency can be sued jointly and severally with the principal or foreign-based employer for
any violation of the recruitment agreement or the contract of employment.
Book II, Rule II, Section 1(f) (3) of the new Rules and Regulations Governing Overseas Employment promulgated by the Governing Board of the POEA
substantially reiterates Rule II of Book II, Section 1(d) (3) of 1985 POEA Rules, which governs this case.
o It provides that a private employment agency shall assume joint and solidary liability with the employer for all claims and liabilities that may arise
in connection with the implementation of the contracts including but not limited to payment of wages, health and disability compensation and
repatriation.
There is no doubt that, under the facts established in this case, AR and Sons is jointly and solidarily liable with overseas employer SAM for the claims of the
petitioners.
WHEREFORE, the challenged decision of the NLRC dated May 31, 1980 is REVERSED and SET ASIDE. The POEA decision dated July 24, 1989 is REINSTATED, with
costs against the private respondents. SO ORDERED.

22. Philippine National Bank v. Philippine National Bank Employees AUTHOR: Pineda
Association (PEMA), Court of Industrial Relations NOTES:
[G.R. No. L-30279; 30 July 1982]
TOPIC: hours of work PONENTE: Barredo, J.
CASE LAW/ DOCTRINE:
It is thus the additional work employed and the adverse effects mentioned above that justify and is the real reason for overtime pay.
Overtime work is actually the lengthening of hours developed to the interests of the employer and the requirements of his enterprise. Hence, it
follows that salaries must be increased. An additional amount (25%+) serves as encouragement or inducement.
COLA, longevity pay), it is illogical to include such in the computation of overtime pay.
FACTS:
Cost of living allowance (COLA) began to be granted in 1958 by PNB, in light of the increased cost of living and heightened inflation. COLA was granted
based on the needs of families and on the condition of the economy.
(You can skip the cause of action, and read the bullet below In sum)
PEMA First Cause of Action:
In 1957 PNB Board of Directors (BOD) issued Resolution 1162, approving a revision of the computation of overtime pay retroactive as of July 1,
1954, and authorized a recomputation of the regular one-hour and extra overtime already rendered by all PNB officers and employees.
In 1963, without just cause, PNB withdrew the above benefits. PNB, despite demands, refuses to give to employees (represented by PEMA) the
above benefits.
PEMA Second Cause of Action:
Pursuant to the Decision in NAWASA v. NAWASA Unions, PEMA has been requesting PNB that the cost of living allowance (COLA) and longevity
pay be taken into account in the computation of overtime pay, effective as of the grant of said benefits on January 1, 1958. However, PNB has
not complied.
In sum, PEMA wants PNB to pay the employees overtime and nighttime rates (with rate differential) from January 28, 1962, and that such overtime pay be
computed by including the COLA and longevity pay.
PNB defense: The CBA has not expired, and thus is controls the grant of benefits. NAWASA ruling cannot control computation defined in CBA.
CBA: Longevity pay shall not form part of the basic salary
ISSUE(S): W/N COLA and longevity pay must be considered in the computation of overtime pay
HELD: NO. PNB wins.
CA 444 (Eight Hour Labor Law)
o Sec. 3: Work may be performed beyond 8 hours a day in case of actual or impending emergencies or in case of urgent work to be performed
in order to avoid a serious loss or some other just case of a similar nature In all such cases, the laborers and employees shall be entitled to
receive compensation for the overtime work performed at the same rate as their regular wages/salary plus at least 25% additional
o Sec. 4: Employee or laborer cannot be compelled to work during Sundays and legal holidays, unless he is paid an additional sum of at least
25% his regular remuneration
Rationale behind extra compensation / overtime pay
o He is made to work longer that what is commensurate with his agreed compensation for the statutorily fixed or voluntarily agreed hours of
labor he is supposed to do.
o Effects on over-time worker: physical/mental effort; delay in going home; no time to relax; miss pre-arranged engagements.
o It is thus the additional work employed and the adverse effects mentioned above that justify and is the real reason for overtime pay.
o Overtime work is actually the lengthening of hours developed to the interests of the employer and the requirements of his enterprise.
Hence, it follows that salaries must be increased. An additional amount (25%+) serves as encouragement or inducement.
Wage: remuneration, however, designated, capable of being expressed in terms of money for work done or serviced rendered
Supplement (different from wage): extra remuneration or benefits received by wage earners from employers including but not limited to vacation
pay, sick leave, cost-of-living bonuses
Longevity pay cannot be included in the computation of overtime pay for the very simple reason that the contrary is stipulated in the CBA. (See facts)
Based on CA 444 and definition of wage, COLAs inclusion in regular wage (for the purpose of computing overtime pay) has no justification.
NAWASA inapplicable, as it did not refer to extra compensation unrelated to work done which is the nature of COLA.
The basis of computation of overtime pay beyond that required by CA 444 must be the CBA. In this case, CBA did not specify that COLA or longevity pay
must be part of regular wages for the purpose of computing overtime pay.
Overtime pay is for extra effort beyond that contemplated in the employment contract, hence when additional pay is given for any other purpose (ie.
COLA, longevity pay), it is illogical to include such in the computation of overtime pay.

CASE TITLE: Interphil Laboratories Employees AUTHOR: Mendoza


Union-FFW v. Interphil Laboratories Inc. NOTES: I only included in the ratio which were related to the topic.
[G.R. No. 142824 Date December 19, 2001]
TOPIC: Overtime Work: Voluntary/ Consensual Section 1 of the CBA:
PONENTE: Kapunan Regular Working Hours A normal workday shall consist of not more than eight (8) hours. The regular working
hours for the Company shall be from 7:30 A.M. to 4:30 P.M. The schedule of shift work shall be maintained;
however the company may change the prevailing work time at its discretion, should such change be necessary
in the operations of the Company. All employees shall observe such rules as have been laid down by the company
for the purpose of effecting control over working hours
CASE LAW/ DOCTRINE:
Where the employees assented by practice to an arrangement of a continuous 24-hour, two-shift work daily schedule in spite of the eight-hour schedule provided
for in their CBA, they cannot now be heard to claim that the overtime boycott is justified because they were not obliged to work beyond eight hours.
FACTS:
Interphil Laboratories Employees Union is the sole and exclusive bargaining agent of the rank-and-file employees of Interphil Laboratories, Inc., a company engaged
in the business of manufacturing and packaging pharmaceutical products. They had a CBA effective from 01 August 1990 to 31 July 1993.
Prior to the expiration of the CBA or sometime in February and March 1993, Nestor Ocampo, the union president, and Hernando Clemente, a union director,
approached Allesandro G. Salazar, VP-Human Resources Dept. of the Interphil. The two union officers inquired about the stand of the company regarding the
duration of the CBA (Working hours starting 7:30 AM to 4:30 PM) which was set to expire in a few months. Salazar told the union officers that the matter could be
best discussed during the formal negotiations that would start soon. The union officers asked whether Salazar would be amenable to make the new CBA effective
for 2 years, starting August 1993.
On April 1993, all the rank-and-file employees of the company refused to follow their regular two-shift work schedule of from 6:00 a.m. to 6:00 p.m., and from
6:00 p.m. to 6:00 a.m. At 2:00 p.m. and 2:00 a.m., respectively, the employees stopped working and left their workplace without sealing the containers and
securing the raw materials they were working on.
To minimize the damage the overtime boycott was causing the company, Salazar immediately asked for a meeting with the union officers. In the meeting, Enrico
Gonzales, a union director, told Salazar that the employees would only return to their normal work schedule if the company would agree to their demands as to the
effectivity and duration of the new CBA. But the union was apparently unsatisfied with the answer of the company, the overtime boycott continued that resulted
to the delay of production in the company.
Respondent-Interphil filed with the NLRC a complaint for illegal strike for the overtime boycott and work slowdown. Also, it filed with the National Conciliation
and Mediation Board (NCMB) an urgent request for preventive mediation aimed to help the parties in their CBA negotiations but both parties failed to reach an
agreement.
Petitioner-Union filed with the NCMB a Notice of Strike citing unfair labor practice allegedly committed by respondent company. The Secretary of Labor, Nieves
Confesor, issued an order directing respondent company to immediately accept all striking workers.
On the other hand, in the interim, the case before Labor Arbiter Caday continued. Petitioner-Union filed an Urgent Manifestation and Motion to Consolidate the
Instant Case and to Suspend Proceedings to consolidate the pending labor dispute with the Secretary of Labor. But the Secretary allowed the LA to proceed and
denied the Petitioners request that submitted to then Secretary Quisumbing his recommendation that the overtime boycott and work slowdown as illegal
strike and the union officers removed from employment.
Petitioner filed an MR but was denied. The CA also denied their Petition for Certiorari.
ISSUE(S): WON the 8 working hours as contended by the Petitioner starting 7:30 AM to 4:30 AM should be followed.
HELD: No. Petition denied.
It is evident from Section 1 of the CBA that the working hours may be changed, at the discretion of the company, should such change be necessary for its
operations, and that the employees shall observe such rules as have been laid down by the company.
In the case before us, Labor Arbiter Caday found that respondent company had to adopt a continuous 24-hour work daily schedule by reason of the nature of
its business and the demands of its clients. It was established that the employees adhered to the said work schedule since 1988. The employees are deemed
to have waived the eight-hour schedule since they followed, without any question or complaint, the two-shift schedule while their CBA was still in force and
even prior thereto.
The two-shift schedule effectively changed the working hours stipulated in the CBA. As the employees assented by practice to this arrangement, they cannot
now be heard to claim that the overtime boycott is justified because they were not obliged to work beyond eight hours.
More importantly, the overtime boycott or work slowdown by the employees constituted a violation of their CBA, which prohibits the union or employee,
during the existence of the CBA, to stage a strike or engage in slowdown or interruption of work

24 WILLIAM LINES, INC v LOPEZ [G.R. No. L-33013 March 28, 1980] AUTHOR: PAGCALIWAGAN
TOPIC: Hours of Work PONENTE: Barredo, J. NOTES:
CASE LAW/ DOCTRINE:

FACTS:
William Lines, Inc. (WLI) which is engaged in shipping business in the PH, employed Eugenio Lopez (Lopez) as storekeeper of the M/V Luzon, with a
monthly salary of P122
He was transferred to M/V Edward, then to M/V Victoriano, and finally to M/V Davao
October 13, 1962 Lopezs services were terminated when M/V Davao was drydocked in Cebu.
He received the separation pay of P1.5K
March 17, 1964 His services were terminated, Lopez, who was refused readmission to work, filed a petition with the CIR.
Claiming salary differentials, premium pay for services rendered on Sundays and holidays, as well as daily overtime compensation, with a
request for reinstatement.
WLI filed a motion to dismiss on the ground that:
CIR had no jurisdiction
Petition stated no cause of action
MTD was denied and WLI was directed to file their answer
Petitioner:
the dismissal of claimant respondent was lawful because he had been paid his separation pay; that he was not entitled to premium pay because petitioner was a
public utility corporation; that the various claims had already prescribed; and that claimant-respondent never rendered overtime service because the nature of
his work was without fixed time and did not require him to work for more than 8 hours a day.

CIR: Rendered decision immediately reinstate complainant Eugenio Lopez to his former work or to any equivalent position, pay him the corresponding overtime
compensation at the rate of 2 hours a day for the duration of his employment, computed on the basis of his actual working days at his last rate.
ISSUE(S): WON the claim for overtime compensation has already prescribed.
HELD: P are directed to pay to claimant-respondent overtime compensation at the rate of 2 hours a day, based on the last monthly salary rate, from March 17,
1961 to October 13, 1962, excluding Sundays and legal holidays, without right to reinstatement.
It is not true that there is no evidence to support the CIRS finding that claimant-respondent worked at an average of "no less than 10 hours a day, 2 hours more
than the minimum requirement specified on the Eight-Hour Labor Law." Lopezs testimony is to the effect that his main duties were (a) to clean the storeroom
and (b) to serve food to the passengers; that although there was" No exact number of hours" for either of these duties, he would "estimate" that 2 hours, more or
less, were spent each time in cleaning the storeroom, morning and afternoon, while 2 hours, more or less, were also needed to serve food, which he did 3 times a
day at 4:30 a.m., 10:00 a.m., and 3 p.m. This clearly averaged 10 hours a day. On the basis of the foregoing testimony, the trial courts finding that he had been
working no less than 10 hours daily is justified. At any rate, doubts should be resolved in his favor to pursue the ends of the Eight-Hour Labor Law (R.A. No. 444),as
amended, which is a social legislation.chanrobles.com:

But, since Sec. 7-A of the Eight-Hour Labor Law allows the enforcement of an action "within three years after the cause of action accrued, otherwise, such action
shall be forever barred", Lopez can collect only the overtime compensation for the 2 hours in excess of the regular 8 hours a day which accrued within 3 years
immediately before the filing of the petition on March 17, 1964. Similar claims which accrued prior to the 3-year period or before March 17, 1961 have already
prescribed, and can no longer be enforced in this action. However, since claimant-respondents services were terminated on October 13, 1962, the computation
of the 2-hour daily overtime will cover the period from March 17, 1961 to October 13, 1962, or a period of 1 year, 6 months and 26 days, from which shall be
excluded Sundays and legal holidays based on the principle that being on board the vessel on these days were "part and parcel of" and "inherent" in his work.

Cagampangan v. NLRC, ACE Maritime Agencies, Inc. [G.R. 85122-24; Mar 22, 1991] AUTHOR: RAMOS
TOPIC: Overtime Work/Pay Evidence PONENTE: Paras, J. NOTES:
CASE LAW/ DOCTRINE:
Rendition of overtime work and the submission of sufficient proof that said work was actually performed are conditions to be satisfied before a seaman could
be entitled to overtime pay
correct criterion in determining WON sailors are entitled to overtime pay is NOT whether they were on board and cannot leave ship beyond the regular 8
working hours a day, but whether they actually rendered service in excess of said number of hours.
FACTS:
Apr 17 and 18, 1985: petitioners (seamen), entered into separate contracts of employment with the Golden Light Ocean Transport, Ltd., through its local
agency, private respondent ACE MARITIME AGENCIES, INC
o deployed on May 7, 1985, and discharged on July 12, 1986
petitioners collectively and/or individually filed complaints for non-payment of overtime pay, vacation pay and terminal pay against private respondent.
o They claimed that they were made to sign their contracts in blank.
o averred that although they agreed to render services on board the vessel Rio Colorado managed by Golden Light Ocean Transport, Ltd., the vessel
they actually boarded was MV "SOIC I" managed by Columbus Navigation.
o 2 petitioners (de Castro and de Jesus) charged that although they were employed as ordinary seamen (OS), they actually performed the work and
duties of Able Seamen (AB)
Respondent failed to answer, thus, an order declared that they waived their right to present evidence in its behalf and that the case was submitted for
decision
Aug 5, 1987: Philippine Overseas Employment Administration (POEA) dismissed petitioners' claim for terminal pay but granted their prayer for leave pay and
30% guaranteed overtime pay.
Upon appeal by respondent to NLRC, POEAs decision was reversed and the petition was dismissed the case for lack of merit (MR denied)
Hence this appeal
o Petitioner: NLRC gravely abused its discretion
overlooked the fact that private respondent company had repeatedly failed and refused to file its answer to petitioners' complaints
erred in reversing and setting aside the POEA decision
o Respondent:
former counsel attended all the hearings before the POEA wherein he raised the basis objection that the complaint of petitioners was
so generally couched that a more detailed pleading with supporting documents was repeatedly requested for the latter to submit
Labor Code basically provides that the rules of evidence prevailing in courts of law or equity shall not be controlling - it is the spirit and
intention of the Code that the Commission and its members.
Petitioners' MR of the NLRC decision did not invoke the merits of the case but merely raised purely technical and procedural matters
o Sol Gen (for NLRC):
Petitioners' assumption that a party who is declared to have waived his right to present evidence also loses his right to appeal from an
adverse judgment made against him is a falsity
although the technical rules of evidence prevailing in the courts of law or equity do not bind labor tribunals, even the Rules
of Court allows a party declared in default to appeal from said judgment by attaching the propriety of the relief awarded
therein
NLRC did not abuse its discretion
evidence presented by petitioners in support of their complaint is by itself sufficient to back up the decision. The issue of
the disallowance of overtime pay stems from an interpretation of particular provisions of the employment contract
ISSUE(S):
1. WON the failure of respondent to submit its responsive pleading was fatal [NO, it was not]
2. WON petitioners are entitled to terminal pay [NO, they are not EXCEPT for Cagampan and Vicera]
3. WON petitioners are entitled to overtime pay [NO, they are not]
HELD: Petition DENIED. NLRC decision AFFIRMED, with the modification that Cagampan and Vicera are awarded their leave pay according to the terms of the
contract
1. The formal or technical defect was rectified by the fact that the POEA proceeded with the hearings on the case where both parties were given sufficient
leeway to ventilate their cases
Petitioners' manifest pursuit of their claims before the POEA in the absence of the answer produced the effect of condoning the failure of respondent
to submit the said answer.
Their submission to the POEA's authority without questioning its jurisdiction to continue the hearings further strengthens the fact that the alleged
technical defect had already been cured. After all, what is there to complain of when the POEA handed down a decision favorable to petitioners with
the allowance of the latter's leave pay and overtime pay
it was only when respondent appealed the NLRC decision to this Court that petitioners suddenly unearth the issue of the default in the POEA case
They resorted to bringing up a technical, NOT a substantial, defect in their desperate attempt to sway the Court's decision in their favor
NLRC and LA have authority under the LC to decide a case based on the position papers and documents submitted, without resorting to the technical
rules of evidence
2. Petitioners were actually paid more than the amounts fixed in their employment contract
NLRC:
o On this award for leave pay to the complainants petitioners, respondent maintains that they were paid much more than what they were
legally entitled to under their contract. This fact has NOT been disputed by the petitioners.
o Thus, their overpayment is more than enough and sufficient to offset whatever claims for leave pay they filed in this case
o For petitioner Aniceto Betana, it appears that under the crew contract his monthly salary was US$400 while he was overpaid by US$100 as
he actually received US$500. He received at least US1,400 excess salary for a period of 14 months which was the period of his employment.
o In the case of petitioner Jorge de Castro, his stipulated monthly pay was US$160 but he actually received a monthly pay of US$200 or an
overpayment of US$560 for the same period of service.
o For petitioner Juanito de Jesus, his overpayment is US$1120.
o Petitioner Arnold Miranda has also the same amount of excess payment as de Jesus.
SC: with respect to petitioners Cagampan and Vicera, the NLRC decision must be modified correspondingly
o Even as the denial of petitioners' terminal pay by the NLRC has been justified, such denial should NOT have been applied to petitioners Julio
Cagampan and Silvino Vicera.
o A deeper scrutiny of the records by the Sol Gen has revealed that the fact of overpayment does not cover the aforenamed petitioners since
the amounts awarded them were equal only to the amounts stipulated in the crew contracts.
o Since petitioners Cagampan and Vicera were NOT overpaid by the company, they should be paid US$583.33 and US$933.33, respectively.
o Further examination by the Sol Gen shows that petitioner Maximo Rosello was also overpaid in the amount of US$420.00
3. Petitioners NEVER produced any proof of actual performance of overtime work
Petitioners: "guaranteed or fixed overtime pay of 30% of the basic salary per month" in their employment contract should be awarded to them as part
of a "package benefit." Even without sufficient evidence of actual rendition of overtime work, they would automatically be entitled to overtime pay.
SC: Their theory is ERRONEOUS for being illogical and unrealistic and for running counter to the intention behind the provision.
o The contract provision means that the fixed overtime pay of 30% would be the basis for computing the overtime pay if and when overtime
work would be rendered.
o Rendition of overtime work and the submission of sufficient proof that said work was actually performed are conditions to be satisfied
before a seaman could be entitled to overtime pay
o contract provision guarantees the right to overtime pay but the entitlement to such benefit must first be established.
Realistically speaking, a seaman stays on board a ship or vessel beyond the regular 8-hour work schedule. For the employer to give him overtime pay for
the extra hours when he might be sleeping or attending to his personal chores or even just lulling away his time would be UNFAIR and UNREASONABLE
o Seamen are required to stay on board their vessels by the very nature of their duties, and it is for this reason that, in addition to their regular
compensation, they are given free living quarters and subsistence allowances when required to be on board.
o It could NOT have been the purpose of our law to require their employers to pay them overtime even when they are NOT actually working;
o The correct criterion in determining WON sailors are entitled to overtime pay is NOT whether they were on board and cannot leave ship
beyond the regular 8 working hours a day, but whether they actually rendered service in excess of said number of hours.

26 NAWASA see case # 3