239. Apodaca v NLRC 2.

Can an obligation arising therefrom be offset against a money claim of an

G.R. No. 80039. April 18, 1989 employee against the employer?

Doctrine: Ruling:
Art. 113. Wage Deduction. — No employer, in his own behalf or in behalf of 1. No. The NLRC has no jurisdiction to determine such intra-corporate dispute
any person, shall make any deduction from the wages of his employees, between the stockholder and the corporation as in the matter of unpaid
except: subscriptions. This controversy is within the exclusive jurisdiction of the
Securities and Exchange Commission.
(a) In cases where the worker is insured with his consent by the employer,
and the deduction is to recompense the employer for the amount paid by him 2. No. Assuming arguendo that NLRC has jurisdiction, the NLRC cannot validly
as premium on the insurance; set it off against the wages and other benefits due petitioner. Article 113 of
the Labor Code allows such a deduction from the wages of the employees by
(b) For union dues, in cases where the right of the worker or his union to the employer, only in three instances, to wit: "ART. 113. Wage Deduction. —
checkoff has been recognized by the employer or authorized in writing by the No employer, in his own behalf or in behalf of any person, shall make any
individual worker concerned; and deduction from the wages of his employees, except: (a) In cases where the
worker is insured with his consent by the employer, and the deduction is to
(c) In cases where the employer is authorized by law or regulations issued by recompense the employer for the amount paid by him as premium on the
the Secretary of Labor. insurance. (b) For union dues, in cases where the right of the worker or his
union to checkoff has been recognized by the employer or authorized in writing
Facts: by the individual worker concerned; and (c) In cases where the employer is
Petitioner was employed in respondent corporation. On August 28, 1985, authorized by law or regulations issued by the Secretary of Labor."
respondent Jose M. Mirasol persuaded petitioner to subscribe to P1,500 shares
of respondent corporation it P100.00 per share or a total of P150,000.00. He
made an initial payment of P37,500.00. On September 1, 1975, petitioner was
appointed President and General Manager of the respondent corporation.
However, on January 2, 1986, he resigned.

On December 19, 1986, petitioner instituted with the NLRC a complaint against
private respondents for the payment of his unpaid wages, his cost of living
allowance, the balance of his gasoline and representation expenses and his
bonus compensation for 1986. Petitioner and private respondents submitted
their position papers to the labor arbiter. Private respondents admitted that
there is due to petitioner the amount of P17,060.07 but this was applied to
the unpaid balance of his subscript in the amount of P95,439.93. Petitioner
questioned the set-off alleging that there was no call or notice for the payment
of unpaid subscription and that, accordingly, the alleged obligation is not
enforceable.

Issue:
1. Does the National Labor Relations Commission (NLRC) have jurisdiction to
resolve a claim for non-payment of stock subscriptions to a corporation?
1
Page
 240. Salazar v NLRC
G.R. No. 109210. April 17, 1996
Doctrine:
1. ART. 280. Regular and Casual Employment. — The provisions of written
agreement to the contrary notwithstanding and regardless of the oral
agreement of the parties, an employment shall be deemed to be regular where
the employee has been engaged to perform activities which are usually
necessary or desirable in the usual business or trade of the employer, except
where the employment has been fixed for a specific project or undertaking the
completion or termination of which has been determined at the time of the
engagement of the employee or where the work or services to be performed
is seasonal in nature and the employment is for the duration of the season.
2. As project employee, petitioner’s services are deemed coterminous with the
project, that is, petitioner’s services may be terminated as soon as the project
for which he was hired is completed.
Facts:
On 17 April 1990, private respondent, at a monthly salary of P4,500.00,
employed petitioner as construction/project engineer for the construction of
the Monte de Piedad building in Cubao, Quezon City. Allegedly, by virtue of an
oral contract, petitioner would also receive a share in the profits after
completion of the project and that petitioner’s services in excess of eight (8)
hours on regular days and services rendered on weekends and legal holidays
shall be compensable overtime at the rate of P27.85 per hour.
On 16 April 1991, petitioner received a memorandum issued by private
respondent’s project manager, Engr. Nestor A. Delantar informing him of the
termination of his services effective on 30 April 1991.
On 13 September 1991, petitioner filed a complaint against private respondent
for illegal dismissal, unfair labor practice, illegal deduction, non-payment of
wages, overtime rendered, service incentive leave pay, commission,
allowances, profit-sharing and separation pay with the NLRC-NCR Arbitration
Branch, Manila.
The Labor Arbiter ruled that petitioner was a managerial employee and
therefore exempt from payment of benefits such as overtime pay, service
incentive leave pay and premium pay for holidays and rest days. Petitioner,
Labor Arbiter Aquino further declared, was also not entitled to separation pay.
2
He was hired as a project employee and his services were terminated due to
Page
the completion of the project.
The Labor Arbiter, likewise, denied petitioner’s claim for a share in the project’s
profits, reimbursement of legal expenses and unpaid wages for lack of basis.
An Appeal was then made to the NLRC. However, the appeal was hereby
Dismissed and the assailed decision is Affirmed en toto.
Issue:
1. Whether supervisory employees should be considered as officers or
members of the managerial staff and hence not entitled to overtime, rest day
and holiday pay
2. Whether or not petitioner is entitled to a share in the profits of the
construction project
3. Whether or not petitioner rendered services from 1 May to 15 May 1991
and is, therefore, entitled to unpaid wages
4. Whether or not private respondent is liable to reimburse petitioner’s legal
expenses and;
5. Whether or not petitioner is entitled to separation pay.
Ruling:
1. Yes. In his original complaint, petitioner stated that the nature of his work
is "supervisory-engineering." Similarly, in his own petition and in other
pleadings submitted to this Court, petitioner confirmed that his job was to
supervise the laborers in the construction project. Hence, although petitioner
cannot strictly be classified as a managerial employee under Art. 82 of the
Labor Code, and sec. 2(b), Rule 1, Book III of the Omnibus Rules
Implementing the Labor Code, nonetheless he is still not entitled to payment
of the aforestated benefits because he falls squarely under another exempt
category — "officers or members of a managerial staff" as defined under sec.
2(c) of the abovementioned implementing rules.
2. As to the issue of profit sharing, we simply cannot grant the same on the
mere basis of complainant’s allegation that respondent verbally promised him
that he is entitled to a share in the profits derive(d) from the projects. Benefits
or privileges of this nature (are) usually in writing, besides complainant failed
to (establish) that said benefits or privileges (have) been given to any of
respondent(’s) employees as a matter of practice or policy.
 3. Yes. petitioner alleges that on 30 April 1991, before closing hours, private
respondent’s project manager, Engineer Nestor Delantar advised him to The applicable provision is Article 280 of the Labor Code which defines the
continue supervising the "finishing touches on many parts of the building term "project employee.
which took him and the assisting laborers until 15 May 1991." Project employees are not entitled to termination pay if they are terminated
as a result of the completion of the project or any phase thereof in which they
As proof of his extended service, petitioner presented the certificate of service are employed, regardless of the number of projects in which they have been
issued by Engr. Delantar attesting to petitioner’s employment as project employed by a particular construction company. Moreover, the company is not
engineer from April 1990 to May 1991. required to obtain a clearance from the Secretary of Labor in connection with
such termination. What is required of the company is a report to the nearest
In contrast, private respondent argues that the abovementioned certificate Public Employment Office for statistical purposes.
was issued solely to accommodate petitioner who needed the same for his
work application abroad. It further stressed that petitioner failed to prove he
actually worked during the aforestated period.

On this score, we rule for the petitioner. The purpose for which the said
certificate was issued becomes irrelevant. The fact remains that private
respondent knowingly and voluntarily issued the certificate. Mere denials and
self-serving statements to the effect that petitioner allegedly promised not to
use the certificate against private respondent are not sufficient to overturn the
same. Hence, private respondent is estopped from assailing the contents of
its own certificate of service.

4. Yes. Petitioner avers that he was implicated in the complaint for the sole
reason that he was the construction engineer of the project. Hence, private
respondent, being the employer, is obligated to pay petitioner’s legal
expenses, particularly, reimbursement of the fees petitioner paid his counsel
amounting to P3,000.00. Petitioner argues that private respondent’s act of
giving allowances to enable petitioner to attend the hearings, as shown in the
disbursement voucher submitted as evidence, 24 constitutes an admission of
the aforestated obligation.

We agree with petitioner. Although not directly implicated in the criminal

complaint, private respondent is nonetheless obligated to defray petitioner’s
legal expenses. Petitioner was included in the complaint not in his personal
capacity but in his capacity as project engineer of private respondent and the
case arose in connection with his work as such. At the construction site,
petitioner is the representative of private respondent being its employee and
he acts for and in behalf of private Respondent. Hence, the inclusion of
petitioner in the complaint for unjust vexation, which was work-related, is
equivalent to inclusion of private respondent itself.
3

5. the Court ruled that petitioner is a project employee and, therefore, not
Page

entitled to separation pay.

 241. SAN MIGUEL BREWERY, INC vs. DEMOCRATIC LABOR
ORGANIZATION
G.R. No. L-18353 July 31, 1963
Doctrine:
The Eight-Hour Labor Law only applies to employees who are paid on a
monthly or daily basis. Employees who are paid on a piece-work basis are
EXCLUDED.
Facts:
On January 27, 1955, the Democratic Labor Association filed complaint against
the San Miguel Brewery, Inc. embodying 12 demands for the betterment of
the conditions of employment of its members. The company filed its answer
to the complaint specifically denying its material averments and answering the
demands point by point. The company asked for the dismissal of the
complaint.
At the hearing held sometime in September, 1955, the union manifested its
desire to confine its claim to its demands for overtime, night-shift differential
pay, and attorney's fees, although it was allowed to present evidence on
service rendered during Sundays and holidays, or on its claim for additional
separation pay and sick and vacation leave compensation.
2. Are the claimants who are watchmen and security guards entitled to extra
pay for work done on Sundays and Holidays?
Ruling:
1. No. The Eight-Hour Labor Law only applies to an employee who is paid on
a monthly or daily basis. This law has no application to employees paid on a
piece-work basis. CIR is wrong to apply the law to the piece-work employees.
According to a ruling by DOLE on Dec. 9, 1957, field sales personnel receiving
monthly salaries (such as the respondents in this case) are not subject to the
Eight-Hour Labor Law (although they are paid on a monthly basis, their
commission shall be considered as payment for extra time he renders in excess
of 8 hours).
2. Yes. Section 4 of Commonwealth Act No. 444 expressly provides that no
person, firm or corporation may compel an employee or laborer to work during
Sundays and legal holidays unless he is paid an additional sum of 25% of his
regular compensation. This proviso is mandatory, regardless of the nature of
compensation. The only exception is with regard to public utilities who perform
some public service.

After the case had been submitted for decision, Presiding Judge Jose S.
Bautista, who was commissioned to receive the evidence, rendered decision
expressing his disposition with regard to the points embodied in the complaint
on which evidence was presented. Judge Bautista ruled that those working
outside the company’s premises are entitled to overtime compensation, hence,
the Eight-Hour Labor Law applies to them.

Its motion for reconsideration having been denied by the industrial court en
banc, which affirmed the decision of the court a quo with few exceptions, the
San Miguel Brewery, Inc. interposed the present petition for review.

Anent the finding of the court a quo, as affirmed by the Court of Industrial
Relations, to the effect that outside or field sales personnel are entitled to the
benefits of the Eight-Hour Labor Law

Issue:
1. Whether the Eight-Hour Labor Law applies to respondent workers.
4
Page
 242. PAN AMERICAN WORLD AIRWAYS SYSTEM v PAN AMERICAN
EMPLOYEES ASSOCIATION
G.R. No. L-16275 February 23, 1961
Doctrine:
1. Where the claimants, at the time of the filing of the petition, were still in
the service of the employer, or, having been separated from service, should
also ask for reinstatement, the claim must be brought before the Court of
Industrial Relations; otherwise, such claim should be brought before the
regular courts.
2. Where during the so-called meal period, the laborers are required to stand
by for emergency work, or where said meals hour is not one of complete rest,
such period is considered overtime.
3. Where during the so-called meal period, the laborers are required to stand
by for emergency work, or where said meals hour is not one of complete rest,
such period is considered overtime.
Facts:
This is an Appeal by certiorari from the decision of the Court of Industrial
Relations in Case No. 1055-V dated October 10, 1959, and its resolution en
banc denying the motion for reconsideration filed by the petitioner herein.
Issue:
(1) the Industrial Court has no jurisdiction to order the payment of overtime
compensation, it being a mere monetary claim cognizable by regular courts;
(2) the finding that the one-hour meal period should be considered overtime
work (deducting 15 minutes as time allotted for eating) is not supported by
substantial evidence;
(3) the court below had no authority to delegate its judicial functions by
ordering the Chief of the Examining Division or his representative to compute
the overtime pay;
(4) the finding that there was no agreement to withdraw Case No. 1055-V in
consideration of the wage increases in the Collective Bargaining Contract (Exh.
"A") is not supported by substantial evidence; and
(5) the court below had no authority to order the company to adopt a straight
5
8-hour shift inclusive of meal period.
Page
Ruling:
1. the Court have since definitely ruled in a recent decisions that the Industrial
Court may properly take cognizance of such cases if, at the time of the petition,
the complainants were still in the service of the employer, or, having been
separated from such service, should ask for reinstatement; otherwise, such
claims should be brought before the regular courts. Since, in the instant case
there is no question that the employees claiming overtime compensation were
still in the service of the company when the case was filed, the jurisdiction of
the Court of Industrial Relations cannot be assailed. In fact, since it is not
pretended that, thereafter, the complainants were discharged or otherwise
terminated their relationship with the company for any reason, all of said
complainants could still be with the company up to the present.
2. The court below found, on the contrary, that during the so called meal
period, the mechanics were required to stand by for emergency work; that if
they happened not to be available when called, they were reprimanded by the
leadman; that as in fact it happened on many occasions, the mechanics had
been called from their meals or told to hurry Employees Association up eating
to perform work during this period. Far from being unsupported by substantial
evidence, the record clearly confirms the above factual findings of the
Industrial Court.
3. It is next contended that in ordering the Chief of the Examining Division or
his representative to compute the compensation due, the Industrial Court
unduly delegated its judicial functions and thereby rendered an incomplete
decision. We do not believe so. Computation of the overtime pay involves a
mechanical function, at most. And the report would still have to be submitted
to the Industrial Court for its approval, by the very terms of the order itself.
That there was no specification of the amount of overtime pay in the decision
did not make it incomplete, since this matter would necessarily be made clear
enough in the implementation of the decision (see Malate Taxicab & Garage,
Inc. vs. CIR, et al., L-8718, May 11, 1956).
4. Similarly, this Court is satisfied with the finding that there was no agreement
to withdraw Case No. 1055-V in consideration of the wage increases obtained
by the, union and set forth in the Collective Bargaining Agreement Exhibit "A".
As reasoned out by the court below, such alleged agreement would have been
incorporated in the contract if it existed. The fact that the union filed a motion
to dismiss without prejudice, after the Collective Bargaining Contract had been
signed, did not necessarily mean that it had agreed to withdraw the case in
consideration of the wage increases. The motion itself (Annex "B", Petition
 for Certiorari) was expressly based on an understanding that the company
would "formulate a schedule of work which shall be in consonance with C. A.
444". All in all, there is substantial evidence in the record to support the finding
of the court below that no such agreement was made.
5. The Industrial Court's order for permanent adoption of a straight 8-hour
shift including the meal period was but a consequence of its finding that the
meal hour was not one of complete rest, but was actually a work hour, since
for its duration, the laborers had to be on ready call. Of course, if the Company
practices in this regard should be modified to afford the mechanics a real rest
during that hour (f. ex., by installing an entirely different emergency crew, or
any similar arrangement), then the modification of this part of the decision
may be sought from the Court below. As things now stand, we see no warrant
for altering the decision.
6
Page
243. ARICA et. Al. v NATIONAL LABOR RELATIONS COMMISSION et.
Al.
G.R. No. 78210 February 28, 1989
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
Facts:
This case stemmed from a complaint filed against private respondent Stanfilco
for assembly time, moral damages and attorney’s fees, with the Regional
Arbitration- Davao City. The Labor Arbiter rendered a decision in favor of
private respondent STANFILCO, holding that:
“We cannot but agree with respondent that the pronouncement in that earlier
case, i.e. the thirty-minute assembly time long practiced cannot be considered
waiting time or work time and, therefore, not compensable, has become the
law of the case which can no longer be disturbed without doing violence to
the time-honored principle of resjudicata.”
NLRC uphold the Labor Arbiters’ decision and declared that:
“Surely, the customary functions referred to in the above-quoted provision of
the agreement includes the long-standing practice and institutionalized non-
compensable assembly time. This, in effect, estopped complainants from
pursuing this case.
MR was denied hence this petition for review on certiorari. Petitioners contend
that the preliminary activities as workers of respondents STANFILCO in the
assembly area is compensable as working time (from 5:30am to 6:00 am)
since these preliminary activities are necessarily and primarily for private
respondent’s benefit. These preliminary activities of the workers are as
follows-.
(a) First there is the roll call. Followed by getting their individual work
assignments from the foreman.
(b) Then, 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 Petition is DISMISSED for lack of merit and the decision of the National Labor
equipment. Relations Commission is AFFIRMED.

(d) Lastly, they travel to the field bringing with them their tools, equipment
and materials.

All these activities take 30 minutes to accomplish.

Respondent avers that the instant complaint is not new because it is the very
same claim they brought against respondent by the same group of rank and
file employees in the case of Arica vs. National Labor Relations Commission
which was filed before in a different case. The said case involved a claim for
“waiting time”, as the complainants purportedly were required to assemble.
In the previous case, the 30-minute assembly time long practiced and
institutionalized by mutual consent of the parties under their CBA cannot be
considered as ‘waiting time’ within the purview of Section 5, Rule 1, Book III
of the Rules and Regulations Implementing the Labor.

ISSUE:
Whether the “assembly time” is compensable.

RULING:
1. The 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
farms 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 evidence of the case demonstrates
that the 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.

Herein petitioners are merely reiterating the very same claim which they filed
in Arica vs NLRC and which records show had already long been considered
7

terminated and closed by this Court. Therefore, the NLRC can not be faulted
Page

for ruling that petitioners’ claim is already barred by res judicata.

 244. PAMPANGA SUGAR DEVELOPMENT CO v COURT OF INDUSTRIAL Whether or not the quitclaims are valid
RELATIONS AND SUGAR WORKERS ASSOCIATION
G.R. No. L-39387 June 29, 1982 Held:
No. The court held that such quitclaims are not valid because of these reasons:
Doctrine: Firstly, the quitclaims are secured after the petitioner lost its case on the lower
The alleged quitclaim agreements are contrary to public policy. Once a civil court. It's obvious that petitioner wants to frustrate the decision of the lower
action is filed in court, the cause of action may not be the subject of court not to grant benefits to the workers. Secondly, while rights may be
compromise unless the same is by leave of the court concerned. Otherwise, waived they must not be contrary to law, public order, public policy, morals or
this will render the entire judicial system irrelevant to the prejudice of the good customs or prejudicial to a third person with a right recognized by law.
national interest. Parties to litigations cannot be allowed to trifle with the The quitclaims are not valid because they are contrary to law. It is provided in
judicial system by coming to court and later on agreeing to a compromise the quitclaims that the workers will forego their benefits and the petitioner
without the knowledge and approval of the court. This converts the judiciary company is exempt from legal liability. Third, the quitclaims are contrary to
into a mere tool of party-litigants who act according to their whims and public policy. Parties to litigations cannot be allowed to trifle with the judicial
caprices. This is more so when the court has already rendered its decision on system by coming to court and later on agreeing to a compromise without the
the issues submitted. knowledge and approval of the court. In the case at bar, the lower court has
already rendered a decision on the issues presented before the alleged
Facts: quitclaims agreements were made. It shows the evident bad faith of the
Sometime in February, 1956, the workers' affiliates of respondent Union petitioner to comply with its legal obligation.
staged a strike against petitioner company. This labor dispute was certified by
the President to the Court of Industrial Relations which was docketed as Case
No. 13-IPA. After six years, the said Court issued an order on November 8,
1962 directing petitioner company to reinstate the members of respondent
union. On March 12, 1963 some 88 union members were thus reinstated by
petitioner. However, petitioner discriminated against the reemployed workers
with respect to wage rates, off-season pay, cost of living allowance, milling
bonus and Christmas bonus by depriving them of aforesaid benefits or by
granting to some members benefits lesser than those given to members of the
Pasudeco Workers Union, another labor group in the service of petitioner. By
reason of such denial and/or grant of lower benefits to respondent's members
because of their union affiliation and union activities, respondent filed with the
CIR a complaint dated September 10, 1964 for unfair labor practice against
petitioner which case was docketed as Case No. 4264-ULP.

On December 4, 1972, the CIR handed down a decision adjudging herein

petitioner guilty of unfair labor practice acts as charged and finding the same
to have been committed, and thereby directing petitioner to cease and desist
from further committing the said unfair labor practice acts and directing
petitioner to pay wage differentials to certain workers and fringe benefits as
would be found due and payable to them and to readmitted seasonal and
casual members of respondent union totalling 88 with the exception of 7
workers.
8
Page

Issue: