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[G.R. No. L-57636. May 16, 1983.

]
REYNALDO TIANGCO and VICTORIA TIANGCO, petitioners, vs. HON. VICENTE
LEOGARDO, JR., Deputy Minister of the Ministry of Labor and Employment, et al,
respondents.

Facts:

Petitioner Tiangco owns the Reynaldo Tiangco Fishing Company. He engaged the
services of the Respondents as batillos who will unload the fish catch from the vessel
and take it to the fish stall. On April 8, 1980, respondents filed a complaint for
underpayment of their emergency cost of living allowances which used to be paid in full
irrespective of their working days, but which were reduced effective February, 1980.

Held:

Since the petitioners had been paying the private respondents a fixed monthly
emergency allowance since November, 1976 up to February, 1980, as a matter of
practice and/or verbal agreement between the petitioners and the private respondents,
the discontinuance of the practice and/or agreement unilaterally by the petitioners
contravened the provisions of the Labor Code, particularly Article 100 thereof which
prohibits the elimination or diminution of existing benefits.
[G.R. No. 170734. May 14, 2008.]
ARCO METAL PRODUCTS, CO., INC., and MRS. SALVADOR UY, petitioners, vs.
SAMAHAN NG MGA MANGGAGAWA SA ARCO METAL-NAFLU (SAMARM-
NAFLU), respondent.

Facts:

Petitioner is a company engaged in manufacture of metal products. Respondent is the


labor union of the rank and file employees. Respondent protested a prorated scheme
implemented by the Company claiming that on several occasions, the company did not
prorate the payment of the benefits of the employees who had not served for full 12
months. The payments in full were made in 1992, 1993, 1994, 1996, 1999, 2003, and
2004. The company argues that the full payments were erroneously made and they
occurred in isolated cases.

Held:

Any benefit and supplement being enjoyed by employees cannot be reduced,


diminished, discontinued or eliminated by the employer. The principle of non-diminution
of benefits is founded on the Constitutional mandate to "protect the rights of workers
and promote their welfare", and "to afford labor full protection." Said mandate in turn is
the basis of Article 4 of the Labor Code which states that "all doubts in the
implementation and interpretation of this Code, including its implementing rules and
regulations shall be rendered in favor of labor." Jurisprudence is replete with cases
which recognize the right of employees to benefits which were voluntarily given by the
employer and which ripened into company practice.
[G.R. No. 152456. April 28, 2004.]
SEVILLA TRADING COMPANY, petitioner, vs. A.V.A. TOMAS E. SEMANA,
SEVILLA TRADING WORKERS UNION-SUPER, respondents.

Facts:

For two to three years prior to 1999, petitioner Sevilla Trading Company (Sevilla
Trading, for short), a domestic corporation engaged in trading business, organized and
existing under Philippine laws, added to the base figure, in its computation of the 13th-
month pay of its employees, the amount of other benefits received by the employees
which are beyond the basic pay. Other benefits include overtime premium, legal holiday
pay, night premium, union leave pay, maternity leave pay, paternity leave pay, vacation
and sick leave pay, and bereavement leave pay.

The company claimed that it entrusted the computation of the 13th month pay to its
office staff and when it changed the person in charge, it discovered the error of
including non-basic pay or other benefits in the computation of 13th month pay. The
company then effected a change in computation.

Held:

With regard to the length of time the company practice should have been exercised to
constitute voluntary employer practice which cannot be unilaterally withdrawn by the
employer, we hold that jurisprudence has not laid down any rule requiring a specific
minimum number of years.

The Supreme Court cited Davao Fruits Corporation vs. Associated Labor Unions ,
wherein the company practice lasted for six (6) years.

In another case, Davao Integrated Port Stevedoring Services vs. Abarquez , the
employer, for three (3) years and nine (9) months, approved the commutation to cash of
the unenjoyed portion of the sick leave with pay benefits of its intermittent workers.

While in Tiangco vs. Leogardo, Jr. , the employer carried on the practice of giving a
fixed monthly emergency allowance from November 1976 to February 1980, or three (3)
years and four (4) months.

In all these cases, this Court held that the grant of these benefits has ripened into
company practice or policy which cannot be peremptorily withdrawn.

In the case at bar, petitioner Sevilla Trading kept the practice of including non-basic
benefits such as paid leaves for unused sick leave and vacation leave in the
computation of their 13th-month pay for at least two (2) years. This, we rule likewise
constitutes voluntary employer practice which cannot be unilaterally withdrawn by the
employer without violating Art. 100 of the Labor Code.
[G.R. No. 85073. August 24, 1993.]
DAVAO FRUITS CORPORATION, petitioner, vs. ASSOCIATED LABOR UNIONS
(ALU) for and in behalf of all the rank-and-file workers/employees of DAVAO
FRUITS CORPORATION and NATIONAL LABOR RELATIONS COMMISSION,
respondent.

Facts:

Respondent Union filed a complaint for payment of 13 th month pay differential. Union
allege that since 1975, the company included in the computation of 13 th month pay the
following benefits: sick, vacation and maternity leaves, premium for work done on rest
days and special holidays, and pay for regular holidays. However, in 1981, the company
excluded these benefits in the computation of 13th month pay.

The company claims that the mistake in the interpretation of "basic salary" was caused
by the opinions, orders and rulings rendered by then Acting Labor Secretary Amado G.
Inciong, expressly including the subject items in computing the thirteenth month pay.

Held:

From 1975 to 1981, petitioner had freely, voluntarily and continuously included in the
computation of its employees' thirteenth month pay, the payments for sick, vacation and
maternity leaves, premiums for work done on rest days and special holidays, and pay
for regular holidays. The considerable length of time the questioned items had been
included by petitioner indicates a unilateral and voluntary act on its part, sufficient in
itself to negate any claim of mistake.

A company practice favorable to the employees had indeed been established and the
payments made pursuant thereto, ripened into benefits enjoyed by them. And any
benefit and supplement being enjoyed by the employees cannot be reduced,
diminished, discontinued or eliminated by the employer.
[G.R. No. 102132. March 19, 1993.]
DAVAO INTEGRATED PORT STEVEDORING SERVICES, petitioner, vs. RUBEN V.
ABARQUEZ, in his capacity as an accredited Voluntary Arbitrator and THE
ASSOCIATION OF TRADE UNIONS (ATU-TUCP), respondents.

Facts:

During the effectivity of the CBA of October 16, 1985 until three (3) months after its
renewal on April 15, 1989, or until July 1989 (a total of three (3) years and nine (9)
months), all the field workers of petitioner who are members of the regular labor pool
and the present regular extra labor pool who had rendered at least 750 hours up to
1,500 hours were extended sick leave with pay benefits. Any unenjoyed portion thereof
at the end of the current year was converted to cash and paid at the end of the said
one-year period. However, when a new manager took over, the company stopped the
payment of cash equivalent of the sick leave to intermittent workers.

Held:

Whatever doubt there may have been early on was clearly obliterated when petitioner-
company recognized the said privilege and paid its intermittent workers the cash
equivalent of the unenjoyed portion of their sick leave with pay benefits during the
lifetime of the CBA of October 16, 1985 until three (3) months from its renewal on April
15, 1989. Well-settled is it that the said privilege of commutation or conversion to cash,
being an existing benefit, the petitioner-company may not unilaterally withdraw, or
diminish such benefits. It is a fact that petitioner-company had, on several instances in
the past, granted and paid the cash equivalent of the unenjoyed portion of the sick leave
benefits of some intermittent workers. Under the circumstances, these may be deemed
to have ripened into company practice or policy which cannot be peremptorily
withdrawn.

(Sudden change in interpretation of the CBA provision)


[G.R. No. 185556. March 28, 2011.]
SUPREME STEEL CORPORATION, petitioner, vs. NAGKAKAISANG
MANGGAGAWA NG SUPREME INDEPENDENT UNION (NMS-IND-APL),
respondent.

Facts:

Respondent Union maintained that for every wage order that was issued in Region 3,
the company never hesitated to comply and grant a similar increase. Specifically,
respondent cited the company’s compliance with Wage Order No. RBIII-10 and grant of
the mandated P15.00 cost of living allowance (COLA) to all its employees.

The company, however, stopped implementing it to non-minimum wage earners on July


24, 2005. It explained that the COLA provided under Wage Order No. RBIII-10 applies
to minimum wage earners only and that, by mistake, it implemented the same across
the board or to all its employees. After realizing its mistake, it stopped integrating the
COLA to the basic pay of the workers who were earning above the minimum wage.

Held:

No diminution of benefits would result if the wage orders are not implemented across
the board, as no such company practice has been established

The implementation of the COLA under Wage Order No. RBIII-10 across the board,
which only lasted for less than a year, cannot be considered as having been practiced
"over a long period of time." While it is true that jurisprudence has not laid down any rule
requiring a specific minimum number of years in order for a practice to be considered as
a voluntary act of the employer, under existing jurisprudence on this matter, an act
carried out within less than a year would certainly not qualify as such. Hence, the
withdrawal of the COLA Wage Order No. RBIII-10 from the salaries of non-minimum
wage earners did not amount to a "diminution of benefits" under the law.
[G.R. No. 117460. January 6, 1997.]
REPUBLIC PLANTERS BANK now known as PNB-REPUBLIC BANK, petitioner,
vs. NATIONAL LABOR RELATIONS COMMISSION and ANTONIO G. SANTOS,
respondents.

Facts:

Santos was employed by Petitioner Bank for 31 years. He filed a compalint for
underpayment of gratuity pay. Petitioner Bank avers that it is erroneous to compute the
gratuity pay based on the salary rate of the next higher rank on the theory that Santos
acquired a vested right over it pursuant to the 1971-1973 Collective Bargaining
Agreement (CBA).

Petitioner Bank posits that as the CBA had long expired it could no longer be used as
basis in computing the gratuity pay of its retiring officers; instead, the computation
should be based on the practice and policy of the bank effective at the time of the
employee's retirement.

Prior to private respondent's resignation, there were other managerial employees who
resigned and/or retired from petitioner's employ who received their corresponding
gratuity benefits and the cash value of their accumulated leave credits pursuant to the
provisions of the old CBA of 1971-73 despite its expiration in 1976. Among them were
Simplicio Manalo and Miguel Calimbas who resigned on 15 March 1977 and 15 July
1978, respectively.

Held:

The bank has adopted the policy of granting gratuity benefits to its retiring officers
based on the salary rate of the next higher rank. It continued to adopt this practice even
after the expiration of the 1971-1973 CBA. The grant was consistent and deliberate
although petitioner knew fully well that it was not required to give the benefits after the
expiration of the 1971-1973 CBA. Under these circumstances, the granting of the
gratuity pay on the basis of the salary rate of the rank next higher may be deemed to
have ripened into company practice or policy which can no longer be peremptorily
withdrawn
[G.R. No. 131247. January 25, 1999.]
PRUBANKERS ASSOCIATION, petitioner, vs. PRUDENTIAL BANK & TRUST
COMPANY, respondent.

Facts:

The Bank implemented the Wage Orders nationwide although they are supposedly
applicable to National Capital Region only. Bank argues that a wage distortion exists,
because the implementation of the two Wage Orders has resulted in the discrepancy in
the compensation of employees of similar pay classification in different regions. Hence,
it maintains that, as a result of the two Wage Orders, the employees in the affected
regions have higher compensation than their counterparts of the same level in other
regions.

Petitioner insists that the Bank has adopted a uniform wage policy, which has attained
the status of an established management practice; thus, it is estopped from
implementing a wage order for a specific region only.

Held:

From the rationale of the law, as well as the criteria, a disparity in wages between
employees with similar positions in different regions is necessarily expected. In insisting
that the employees of the same pay class in different regions should receive the same
compensation, petitioner has apparently misunderstood both the meaning of wage
distortion and the intent of the law to regionalize wage rates.

Nationwide uniform wage policy of the Bank had been adopted prior to the enactment of
RA 6727. After the passage of said law, the Bank was mandated to regionalize its wage
structure. Although the Bank implemented Wage Order Nos. NCR-01 and NCR-02
nationwide instead of regionally even after the effectivity of RA 6727, the Bank at the
time was still uncertain about how to follow the new law. In any event, that single
instance cannot be constitutive of "management practice."
[G.R. No. 74156. June 29, 1988.]
GLOBE MACKAY CABLE AND RADIO CORPORATION, FREDERICK WHITE and
JESUS SANTIAGO, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION,
FFW-GLOBE MACKAY EMPLOYEES UNION and EDA CONCEPCION,
respondents.

Facts:

Wage Order No. 6, which took effect on 30 October 1984, increased the cost-of-living
allowance of non-agricultural workers in the private sector. Petitioner corporation
complied with the said Wage Order by paying its monthly-paid employees the mandated
P3.00 per day COLA. However, in computing said COLA, Petitioner Corporation
multiplied the P3.00 daily COLA by 22 days, which is the number of working days in the
company.
Respondent Union disagreed with the computation of the monthly COLA claiming that
the daily COLA rate of P3.00 should be multiplied by 30 days to arrive at the monthly
COLA rate. The union alleged furthermore that prior to the effectivity of Wage Order No.
6, Petitioner Corporation had been computing and paying the monthly COLA on the
basis of thirty (30) days per month and that this constituted an employer practice, which
should not be unilaterally withdrawn.

Held:

Before Wage Order No. 4, there was lack of administrative guidelines for the
implementation of the Wage Orders. It was only when the Rules Implementing Wage
Order No. 4 were issued on 21 May 1984 that a formula for the conversion of the daily
allowance to its monthly equivalent was laid down.

Absent clear administrative guidelines, Petitioner Corporation cannot be faulted for


erroneous application of the law. Payment may be said to have been made by reason of
a mistake in the construction or application of a "doubtful or difficult question of law."
(Article 2155, 1 in relation to Article 2154 2 of the Civil Code). Since it is a past error
that is being corrected, no vested right may be said to have arisen nor any diminution of
benefit under Article 100 of the Labor Code 3 may be said to have resulted by virtue of
the correction.
[G.R. No. L-50568. November 7, 1979.]
OCEANIC PHARMACAL EMPLOYEES UNION (FFW), complainant-appellant, vs.
HON. AMADO G. INCIONG and OCEANIC PHARMACAL INC., respondents-
appellees

Facts:

Oceanic Pharmacal Employees Union and Oceanic Pharmacal, Inc. had a collective
bargaining agreement (CBA) good from March 1, 1976 to February 28, 1979. On April
27, 1976, Oceanic sent a Supplementary Agreement to the CBA wherein it agreed to
continue the grant of emergency allowance and holiday pay.

However, on October 25, 1976, Oceanic posted a memorandum stating the


discontinuance of the payment of emergency allowance and holiday pay.

Held:

Section 2, Rule IV, Book III of the Rules and Regulations Implementing the Labor Code
was promulgated on February 16, 1976. On the other hand, Policy Instructions No. 9
was issued on February 23, 1976. Since the said rules and policy instructions were
already existing and effective prior to the execution of the Supplementary Agreement on
April 27, 1976, it is clear that respondent company agreed to continue giving holiday
pay to its monthly paid employees knowing fully well that said employees are not
covered by the law requiring payment of holiday pay. When respondent company,
therefore, interposed the condition that it "shall continue to extend the said benefits
unless otherwise directed by other new requirements, rules, laws, decrees, etc. on the
subject', it was referring to laws, decrees, rules, etc. other than the above-cited
issuances
[G.R. No. 174040-41. September 22, 2010.]
INSULAR HOTEL EMPLOYEES UNION-NFL, petitioner, vs. WATERFRONT
INSULAR HOTEL DAVAO, respondent.

Facts:

To save their employer from total closure because of losses, the employees’ union in
Waterfront Insular Hotel in Davao proposed not only to suspend for 10 years their CBA
but also to waive some benefits and privileges grated under the CBA.

After series of negotiations, respondent and DIHFEU-NFL, represented by its President,


Rojas, and Vice-Presidents, Exequiel J. Varela Jr. and Avelino C. Bation, Jr., signed a
Memorandum of Agreement (MOA) wherein respondent agreed to re-open the hotel
subject to certain concessions offered by DIHFEU-NFL in its Manifesto.

Accordingly, respondent downsized its manpower structure to 100 rank-and-file


employees as set forth in the terms of the MOA. Moreover, as agreed upon in the MOA,
a new pay scale was also prepared by respondent.

However, some employees contested the MOA.

Held:

The prohibition against elimination or diminution of benefits set out in Article 100 of the
Labor Code is specifically concerned with benefits already enjoyed at the time of the
promulgation of the Labor Code. Article 100 does not, in other words, purport to apply to
situations arising after the promulgation date of the Labor Code.

Even assuming arguendo that Article 100 applies to the case at bar, this Court agrees
with respondent that the same does not prohibit a union from offering and agreeing to
reduce wages and benefits of the employees.

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

While the terms of the MOA undoubtedly reduced the salaries and certain benefits
previously enjoyed by the members of the Union, it cannot escape this Court's attention
that it was the execution of the MOA which paved the way for the re-opening of the
hotel, notwithstanding its financial distress. More importantly, the execution of the MOA
allowed respondents to keep their jobs. It would certainly be iniquitous for the members
of the Union to sign new contracts prompting the re-opening of the hotel only to later on
renege on their agreement on the fact of the non-ratification of the MOA.
[G.R. No. L-24632. October 26, 1968.]
LEXAL LABORATORIES and/or JOSE ANGELES, Manager, petitioners, vs.
NATIONAL CHEMICAL INDUSTRIES WORKERS UNION — PAFLU (Lexal
Laboratories Chapter) and THE COURT OF INDUSTRIAL RELATIONS,
respondents.

Facts:

Lexal Laboratories was directed to reinstate Guillermo Ponseca with full backwages
from the day of dismissal up to the time he is actually reinstated.

The issue is whether per diems is included in the computation of backpay.

Held:

Per diem, the dictionary definition tells us, is "a daily allowance" given "for each day he
[an officer or employee] was away from his home base." It would seem to us that per
diem is intended to cover the cost of lodging and subsistence of officers and employees
when the latter are on duty outside of their permanent station.

Lexal concedes that whenever its employee, Guillermo Ponseca, was out of Manila, he
was allowed a per diem of P4.00 broken down as follows: P1.00 for breakfast; P1.00 for
lunch; P1.00 for dinner; and P1.00 for lodging. Ponseca — during the period involved —
did not leave Manila. Therefore, he spent nothing for meals and lodging outside of
Manila. Because he spent nothing, there is nothing to be reimbursed. Since per diems
are in the nature of reimbursement, Ponseca should not be entitled to per diems.
[G.R. Nos. 58094-95. March 15, 1989.]
MAMERTO B. ASIS, petitioner, vs. MINISTER OF LABOR AND EMPLOYMENT,
CENTRAL AZUCARERA DE PILAR, and EMMANUEL JAVELLANA, respondents.

Facts:

In addition to his basic salaries and other fringe benefits, his employer granted him, and
a few other officials of the company, a monthly ration of 200 liters of gasoline and a
small tank of liquefied petroleum gas (LPG). This monthly ration was temporarily
revoked some five (5) years later as a cost reduction measure of the Central. The
petitioner and the other officials adversely affected filed a complaint.

Held:

The monthly ration was not a part of basic salary, and is not indeed found in any of the
management payroll vouchers pertinent to the petitioner. Moreover, the adverse
consequences of the suspension of the monthly rations had been largely if not entirely
negated by the Central's undertaking to reimburse the petitioner for his actual
consumption of fuel during the period of suspension.
SECOND DIVISION
[G.R. No. 101761. March 24, 1993.]
NATIONAL SUGAR REFINERIES CORPORATION, petitioner, vs. NATIONAL
LABOR RELATIONS COMMISSION and NBSR SUPERVISORY UNION, (PACIWU)
TUCP, respondents.

Facts:

Prior to the Job evaluation (JE) Program, the union members, while being supervisors,
received benefits similar to the rank-and-file employees such as overtime, rest day and
holiday pay, simply because they were treated in the same manner as rank-and-file
employees, and their basic pay was nearly on the same level as those of the latter,
aside from the fact that their specific functions and duties then as supervisors had not
been properly defined and delineated from those of the rank-and-file.

Those whose duties confirmed them to be supervisory, were re-evaluated, their duties
re-defined and in most cases their organizational positions re-designated to confirm
their superior rank and duties. Thus, after the JE program, those who were reclassified
as supervisory will no longer receive benefits such as overtime, rest day and holiday
pay.

Held:

Supreme Court agreed with the Corporation that the complainants should be considered
as officers and members of the managerial staff and are not entitled to overtime, rest
day and holiday pay.

The test or rationale of this rule on long practice requires an indubitable showing that
the employer agreed to continue giving the benefits knowingly fully well that said
employees are not covered by the law requiring payment thereof. In the case at bar,
respondent union failed to sufficiently establish that petitioner has been motivated or is
wont to give these benefits out of pure generosity.

With the promotion of the union members, they are no longer entitled to the benefits
which attach and pertain exclusively to their 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 met the requirements imposed by law. Their assumption of these positions
removed them from the coverage of the law.
[G.R. No. 155059. April 29, 2005.]
AMERICAN WIRE AND CABLE DAILY RATED EMPLOYEES UNION, petitioner, vs.
AMERICAN WIRE AND CABLE CO., INC. and THE COURT OF APPEALS,
respondents.

Facts:
American Wire and Cable Co., Inc., is a corporation engaged in the manufacture of
wires and cables. There are two unions in this company, the American Wire and Cable
Monthly-Rated Employees Union (Monthly-Rated Union) and the American Wire and
Cable Daily-Rated Employees Union (Daily-Rated Union).

On 16 February 2001, an original action was filed before the NCMB of the Department
of Labor and Employment (DOLE) by the two unions for voluntary arbitration. They
alleged that the private respondent, without valid cause, suddenly and unilaterally
withdrew and denied certain benefits and entitlements which they have long enjoyed.

Held:

For a bonus to be enforceable, it must have been promised by the employer and
expressly agreed upon by the parties, or it must have had a fixed amount and had been
a long and regular practice on the part of the employer.

The benefits/entitlements in question were never subjects of any express agreement


between the parties. They were never incorporated in the Collective Bargaining
Agreement (CBA). As observed by the Voluntary Arbitrator, the records reveal that
these benefits/entitlements have not been subjects of any express agreement between
the union and the company, and have not yet been incorporated in the CBA. In fact, the
petitioner has not denied having made proposals with the private respondent for the
service award and the additional 35% premium pay to be made part of the CBA.

The Christmas parties and its incidental benefits, and the giving of cash incentive
together with the service award cannot be said to have fixed amounts. What is clear
from the records is that over the years, there had been a downtrend in the amount given
as service award. There was also a downtrend with respect to the holding of the
Christmas parties in the sense that its location changed from paid venues to one which
was free of charge, evidently to cut costs. Also, the grant of these two aforementioned
bonuses cannot be considered to have been the private respondent's long and regular
practice. To be considered a "regular practice," the giving of the bonus should have
been done over a long period of time, and must be shown to have been consistent and
deliberate. The downtrend in the grant of these two bonuses over the years
demonstrates that there is nothing consistent about it.

To hold that an employer should be forced to distribute bonuses which it granted out of
kindness is to penalize him for his past generosity.
[G.R. No. 88168. August 30, 1990.]
TRADERS ROYAL BANK, petitioner, vs. NATIONAL LABOR RELATIONS
COMMISSION & TRADERS ROYAL BANK EMPLOYEES UNION, respondents.

Facts:

Union allege that there was diminution of benefits being enjoyed by the employees
since time immemorial, e.g. mid-year bonus, from two (2) months gross pay to two (2)
months basic and year-end bonus from three (3) months gross to only two (2) months.

Petitioner, on the other hand, insisted that it had paid the employees holiday pay. The
practice of giving them bonuses at year's end, would depend on how profitable the
operation of the bank had been. Generally, the bonus given was two (2) months basic
mid-year and two (2) months gross end-year.

Held:

A bonus is "a gratuity or act of liberality of the giver which the recipient has no right to
demand as a matter of right" (Aragon vs. Cebu Portland Cement Co., 61 O.G. 4597). "It
is something given in addition to what is ordinarily received by or strictly due the
recipient." The granting of a bonus is basically a management prerogative which cannot
be forced upon the employer "who may not be obliged to assume the onerous burden of
granting bonuses or other benefits aside from the employee's basic salaries or wages.

From 1979-1985, the bonuses were less because the income of the Bank had
decreased. In 1986, the income of the Bank was only 20.2 million pesos, but the Bank
still gave out the usual two (2) months basic mid-year and two months gross year-end
bonuses. The petitioner pointed out, however, that the Bank weakened considerably
after 1986 on account of political developments in the country.

In the light of these submissions of the petitioner, the contention of the Union that the
granting of bonuses to the employees had ripened into a company practice that may not
be adjusted to the prevailing financial condition of the Bank has no legal and moral
bases. Its fiscal condition having declined, the Bank may not be forced to distribute
bonuses which it can no longer afford to pay and, in effect, be penalized for its past
generosity to its employees.