DAVID vs. MACASIO G.R. No.

195466 | July 2, 2014

Facts:
1. Macasio filed before the LA a complaint against petitioner Ariel L. David, doing business under the name and style “Yiels Hog
Dealer,” for nonpayment of overtime pay, holiday pay and 13th month pay. Macasio also claimed service incentive leave (SIL).
2. Macasio alleged that he had been working as butcher for David since 1995; that David exercised control and supervision over him
by setting the work day, reporting time and hogs to be chopped as well as manner of work; that David daily paid his salaray of
P700.00; that David approved and disapproved his leaves. Macasio added that David owned the hogs as well as the tools, that David
also rented the workplace and that David had 25 butchers and delivery drivers.
3. In his defense, David claimed that he started his hog dealer business in 2005 and that he only has ten employees. He alleged that he
hired Macasio as a butcher or chopper on “pakyaw” or task basis who is, therefore, not entitled to overtime pay, holiday pay and
13th month pay pursuant to the Labor Code’s IRR. David pointed out that Macasio: (1) usually starts his work at 10:00 p.m. and
ends at 2:00 a.m. of the following day or earlier, depending on the volume of the delivered hogs; (2) received the fixed amount of
P700.00 per engagement, regardless of the actual number of hours that he spent chopping the delivered hogs; and (3) was not
engaged to report for work and, accordingly, did not receive any fee when no hogs were delivered.
4. Macasio disputed David’s allegations. Macasio argued that, as per a Certificate of Employment that David issued in his favor which
erroneously placed Macasio’s employment date at 2000, David did not start his business only in 2005. Also, he reported for work
every day which the payroll or time record could have easily proved had David submitted them in evidence.
5. Refuting Macasio’s submissions, David claims that Macasio was not his employee as he hired the latter on “pakyaw” or task basis.
He also claimed that he issued the Certificate of Employment, upon Macasio’s request, only for overseas employment purposes. He
pointed to the “Pinagsamang Sinumpaang Salaysay,” executed by Presbitero Solano and Christopher (Antonio Macasio’s co-
butchers), to corroborate his claims.
6. LA dismissed the claims, giving credence to the pakyaw basis claim which makes Macasio not entitled to overtime, holiday, SIL
and 13th month pay. NLRC affirmed LA. CA partly granted Macasio’s certiorari petition, awarding his claim for holiday, SIL and
13th month pay.
7. In this petition, David maintains that Macasio’s engagement was on a “pakyaw” or task basis. Hence, the latter is excluded from
the coverage of holiday, SIL and 13th month pay. David adds that he never had any control over the manner by which Macasio
performed his work and he simply looked on to the “end-result.” He also contends that he never compelled Macasio to report for
work and that under their arrangement, Macasio was at liberty to choose whether to report for work or not as other butchers could
carry out his tasks. He points out that Solano and Antonio had, in fact, attested to their (David and Macasio’s) established
“pakyawan” arrangement that rendered a written contract unnecessary. In as much as Macasio is a task basis employee — who is
paid the fixed amount of P700.00 per engagement regardless of the time consumed in the performance — David argues that Macasio
is not entitled to the benefits he claims. Also, he posits that because he engaged Macasio on “pakyaw” or task basis then no
employer-employee relationship exists between them.
Issues:
1) Whether an employer-employee relationship exists.
2) Whether those on pakyaw basis are entitled to holiday pay and SIL.
3) Whether Macasio is entitled to his claim.
Ratio Decidendi:
1) YES. First, David engaged the services of Macasio, thus satisfying the element of “selection and engagement of the employee.”
This is evidenced by David’s “Sinumpaang Salaysay” wherein he admitted that Macasio applied for the job and was accepted by
David, and by Solano and Antonio’s “Pinagsamang Sinumpaang Salaysay” wherein they attested to Macasio being their co-worker.
Second, David paid Macasio’s wages. Both David and Macasio categorically stated in their respective pleadings before the lower
tribunals and even before this Court that the former had been paying the latter P700.00 each day after the latter had finished the
day’s task. Solano and Antonio also confirmed this fact of wage payment in their “Pinagsamang Sinumpaang Salaysay.” Third,
David had been setting the day and time when Macasio should report for work. By having power to control Macasio’s schedule, he
can regulate the work and could even refuse to give him any assignment, thereby effectively dismissing him. And fourth, David
had the right and power to control and supervise Macasio’s work as to the means and methods of performing it. In addition to setting
the day and time when Macasio should report for work, the established facts show that David rents the place where Macasio had
been performing his tasks. Moreover, Macasio would leave the workplace only after he had finished chopping all of the hog meats
given to him for the day’s task. Also, David would still engage Macasio’s services and have him report for work even during the
days when only few hogs were delivered for butchering.
A distinguishing characteristic of “pakyaw” or task basis engagement, as opposed to straight-hour wage payment, is the non-
consideration of the time spent in working. 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 or
task is completed, the worker receives fixed amount as wage, without regard to the standard measurement of time generally used in
pay computation.
In Macasio’s case, the established facts show that he would usually start his work at 10:00 p.m. Thereafter, regardless of the total
hours that he spent at the workplace or of the total number of the hogs assigned to him for chopping, Macasio would receive the
fixed amount of P700.00 once he had completed his task. Clearly, these circumstances show a “pakyaw” or task basis engagement
that all three tribunals uniformly found.

2) YES. Article 82 LC provides that the provisions of Title I (working conditions and rest periods) do not apply to field personnel and
workers who are paid by results as determined by Secretary of Labor in appropriate regulations. “Field personnel” shall refer to
nonagricultural employees who regularly perform their duties away from the principal place of business or branch office of the
employer and whose actual hours of work in the field cannot be determined with reasonable certainty.

Article 94 provides for right to holiday pay, and its IRR states that it shall apply to all employees except 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.” On the other hand, Article 95 provides for right to SIL, and its IRR provides that it applies to all
employees except to “Field personnel and other employees whose performance is unsupervised by the employer including
those who are engaged on task or contract basis.”
Note that unlike Article 82, the IRR on holiday and SIL pay do 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 one
classification of exempted employees.
The resolution of the issue hinges on how to interpret the phrase “those who are engaged on task or contract basis.” According
to decided cases, the phrase should be related with field personnel applying the rule on ejusdem generis. In other words, the
payment of an employee on task or pakyaw basis alone is insufficient to exclude one from the coverage of SIL and holiday
 pay. They are exempted from the coverage of Title I (including the holiday and SIL pay) only if they qualify as “field
personnel.”
Thus, in Serrano vs. Severino Santos Transit (which was the legal basis of the CA ruling), the Court, applying the rule on
ejusdem generis, declared that “employees engaged on task or contract basis 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.” Although Serrano
speaks only of SIL pay, the principle still applies to holiday pay since the exempting phrases under the IRR’s for SIL and
holiday pay are identical.
In short, in determining whether workers engaged on “pakyaw” or task basis is entitled to holiday and SIL pay, the presence
(or absence) of employer supervision as regards the worker’s time and performance is the key: if the worker is simply engaged
on pakyaw or task 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 Article 94 (holiday pay) and Article 95 (SIL pay) of the Labor Code. 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.

3) PARTLY YES. Macasio is entitled to his claim insofar as holiday pay and SIL is concerned. He is not field personnel. First,
Macasio regularly performed his duties at David’s principal place of business; Second, his actual hours of work could be determined
with reasonable certainty; and Third, David supervised his time and performance of duties. Since Macasio cannot be considered a
“field personnel,” then he is not exempted from the grant of holiday, SIL pay even as he was engaged on “pakyaw” or task basis.
With respect to 13th month pay which is governed by PD 851, Macasio cannot claim. PD 851’s IRR provides that those who
are paid on task basis, and those who are paid a fixed amount for performing a specific work, irrespective of time consumed in
performance thereof, are exempted from 13 th month pay benefits. Note that unlike the IRR of the Labor Code on holiday and
SIL pay, PD 851’s IRR exempts employees “paid on task basis” without any reference to “field personnel.” This could only
mean that, insofar as payment of the 13th month pay is concerned, the law did not intend to qualify the exemption from its
coverage with the requirement that the task worker be a “field personnel” at the same time.
Bisig Manggagawa sa Tryco v. NLRC G.R. No. 151309, 15 October 2008
Facts:
Tryco Pharma Corporation (Tryco) is a manufacturer of veterinary medicines and its principal office is located in Caloocan
City. Petitioners Joselito Lariño, Vivencio Barte, Saturnino Egera and Simplicio Aya-ay are its regular employees, occupying the
positions of helper, shipment helper and factory workers, respectively, assigned to the Production Department. They are members of
Bisig Manggagawa sa Tryco (BMT), the exclusive bargaining representative of the rank-and-file employees.
Tryco and the petitioners signed separate Memoranda of Agreement 2 (MOA), providing for a compressed workweek schedule
to be implemented in the company effective May 20, 1996. The MOA was entered into pursuant to Department of Labor and
Employment Department Order (D.O.) No. 21, Series of 1990, Guidelines on the Implementation of Compressed Workweek.
As provided in the 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.
Tryco informed the Bureau of Working Conditions of the Department of Labor and Employment of the implementation of a
compressed workweek in the company. In January 1997, BMT and Tryco negotiated for the renewal of their collective bargaining
agreement (CBA) but failed to arrive at a new agreement. Meantime, Tryco received the Letter dated March 26, 1997 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. Accordingly, Tryco issued a Memorandum dated April 7, 1997 which directed petitioner Aya-ay to report to the
company’s plant site in Bulacan. When petitioner Aya-ay refused to obey, Tryco reiterated the order on April 18, 1997. Subsequently,
through a Memorandum dated May 9, 1997, Tryco also directed petitioners Egera, Lariño and Barte to report to the company’s plant
site in Bulacan.
BMT opposed the transfer of its members to San Rafael, Bulacan, contending that it constitutes unfair labor practice. In protest,
BMT declared a strike on May 26, 1997. In August 1997, petitioners filed their separate complaints 8 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. In their Position Paper, petitioners alleged that the company acted in bad faith during the CBA negotiations because it sent
representatives without authority to bind the company, and this was the reason why the negotiations failed. They added that the
management transferred petitioners Lariño, Barte, Egera and Aya-ay from Caloocan to San Rafael, Bulacan to paralyze the union. They
prayed for the company to pay them their salaries from May 26 to 31, 1997, service incentive leave, and overtime pay, and to implement
Wage Order No. 4.
In their defense, respondents averred that the petitioners were not dismissed but they refused to comply with the management’s
directive for them to report to the company’s plant in San Rafael, Bulacan. They denied the allegation that they negotiated in bad faith,
stating that, in fact, they sent the Executive Vice-President and Legal Counsel as the company’s representatives to the CBA negotiations.
They claim that the failure to arrive at an agreement was due to the stubbornness of the union panel. Respondents further
averred that, long before the start of the negotiations, the company had already been planning to decongest the Caloocan office to comply
with the government policy to shift the concentration of manufacturing activities from the metropolis to the countryside. The decision
to transfer the company’s production activities to San Rafael, Bulacan was precipitated by the letter-reminder of the Bureau of Animal
Industry.
On February 27, 1998, the 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. The Labor Arbiter also
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. As for the claim of noncompliance with Wage Order No. 4, the Labor Arbiter held that the issue should be left to the grievance
machinery or voluntary arbitrator.
On October 29, 1999, the NLRC affirmed the Labor Arbiter’s Decision, dismissing the case. Complainants Joselito Lariño,
Vivencio Barte, Saturnino Egera and Simplicio Aya-ay are directed to report to work at respondents’ San Rafael Plant, Bulacan but
without backwages. Respondents are directed to accept the complainants back to work.
On December 22, 1999, the NLRC denied the petitioners’ motion for reconsideration for lack of merit. Left with no recourse,
petitioners filed a petition for certiorari with the CA. On July 24, 2001, the CA 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 Court’s rulings upholding a waiver of
benefits in exchange of other valuable privileges.

Issue:
1. Whether there was illegal constructive dismissal of the petitioners.
2. Whether private respondents committed unfair labor practice.
3. Whether the MOA is not enforceable as it is contrary to law.

Held:
1. No. There is no reason to deviate from the well-entrenched rule that findings of fact of labor officials, who are deemed
to have acquired expertise in matters within their respective jurisdiction, are generally accorded not only respect but even finality, and
bind us when supported by substantial evidence. This is particularly true when the findings of the Labor Arbiter, the NLRC and the CA
are in absolute agreement.
Petitioners mainly contend that the transfer orders amount to a constructive dismissal. They maintain that the letter of the
Bureau of Animal Industry is not credible because it is not authenticated; it is only a ploy, solicited by respondents to give them an
excuse to effect a massive transfer of employees. The Court denied the petitioners’ wild and reckless imputation that the Bureau of
Animal Industry conspired with the respondents just to effect the transfer of the petitioners. There is not an iota of proof to support the
outlandish claim.
Furthermore, Tryco’s decision to transfer its production activities to San Rafael, Bulacan, regardless of whether it was made
pursuant to the letter of the Bureau of Animal Industry, was within the scope of its inherent right to control and manage its enterprise
effectively. While the law is solicitous of the welfare of employees, it must also protect the right of an employer to exercise what are
clearly management prerogatives.
When the transfer is not unreasonable, or inconvenient, or prejudicial to the employee, and it does not involve a demotion in
rank or diminution of salaries, benefits, and other privileges, the employee may not complain that it amounts to a constructive dismissal.
However, the employer has the burden of proving that the transfer of an employee is for valid and legitimate grounds.
In the instant case, the transfer orders do not entail a demotion in rank or diminution of salaries, benefits and other privileges
of the petitioners. Petitioners, therefore, anchor their objection solely on the ground that it would cause them great inconvenience since
they are all residents of Metro Manila and they would incur additional expenses to travel daily from Manila to Bulacan. The Court
declared that mere incidental inconvenience is not sufficient to warrant a claim of constructive dismissal.
2. No. The Court could not see how the mere transfer of its members can paralyze the union. The union was not deprived
of the membership of the petitioners whose work assignments were only transferred to another location. There was no showing or any
indication that the transfer orders were motivated by an intention to interfere with the petitioners’ right to organize.
Unfair labor practice refers to acts that violate the workers’ right to organize. With the exception of Article 248(f) of the Labor
Code of the Philippines, the prohibited acts are related to the workers’ right to self-organization and to the observance of a CBA. Without
that element, the acts, no matter how unfair, are not unfair labor practices.
3. 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. Moreover, 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.
Notably, the MOA complied with 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:
1. Employees voluntarily agree to work more than 8 hours a day the total in a week shall not exceed normal weekly hours of
work prior to the compressed workweek.
2. No diminution whatsoever of weekly or monthly take-home pay and fringe benefits.
3. If an employee is permitted or required to work in excess of his normal weekly hours prior to adoption of the compressed
workweek scheme, all such excess shall be considered overtime work and compensated in accordance with the LC and
CBA.
4. Appropriate waivers with respect to overtime premium pay for work performed in excess of 8 hours a day may be devised
by the parties to the agreement.
5. Effectivity and implementation shall be by agreement of the parties.
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.

PENARANDA vs. BAGANGA G.R. No. 159577 | May 3, 2006

Facts:
1. Petitioner Charlito Peñaranda was hired as an employee of Baganga Plywood Corporation (BPC) to take charge of the operations
and maintenance of its steam plant boiler. He filed a Complaint for illegal dismissal with money claims against BPC and its general
manager, Hudson Chua, before the NLRC.
2. He alleges that he was employed by respondent BPC on March 15, 1999 with a monthly salary of P5,000.00 as Foreman/Boiler
Head/Shift Engineer until he was illegally terminated on December 19, 2000. Further, he alleges that his services were terminated
without the benefit of due process and valid grounds in accordance with law. Furthermore, he was not paid his overtime pay,
premium pay for working during holidays/rest days, night shift differentials and finally claims for payment of damages and
attorney’s fees having been forced to litigate the present complaint.
3. Respondents allege that his separation was done in pursuance of Art. 283 of the Labor Code. BPC was on temporary closure due to
repair and general maintenance and it applied for clearance with the DOLE to shut down and to dismiss employees. Due to
petitioner’s insistence, he was paid his separation benefits. Consequently, when BPC partially reopened in 2001, petitioner failed
to reapply. Hence, he was not terminated much less illegally. Moreover, he was not a managerial employee and therefore he was
 not entitled of overtime pay. If ever he rendered services beyond normal hours of work, there was no office order/authorization for
him to do so.
4. LA ruled that the temporary closure did not terminate petitioner’s employment; hence, he need not reapply when the plant reopened.
According to the labor arbiter, petitioner’s 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. Nevertheless, the labor arbiter found petitioner entitled to overtime pay, premium pay for working on rest days, and
attorney’s fees in the total amount of P21,257.98.
5. On respondents’ appeal, NLRC deleted award of overtime pay and premium pay for working rest days. CA dismissed petitioner’s
petition for certiorari on procedural grounds, to wit: 1) He failed to attach copies of pleadings he submitted to LA and NLRC; and
2) He failed to explain why the filing and service of the Petition was not done by personal service. MR denied. Hence, this petition.
Issues:
1) Whether the CA dismissal of petitioner’s petition was correct.
2) Whether respondents’ appeal to NLRC was timely.
3) Whether petitioner is entitled to overtime pay and premium pay for working on rest days.
Ratio Decidendi:
1) NO. The Petition filed with the CA shows a prima facie case. Petitioner attached his evidence to challenge the finding that he
was a managerial employee. In his MR, petitioner also submitted the pleadings before the labor arbiter in an attempt to comply
with the CA rules. Evidently, the CA could have ruled on the Petition on the basis of these attachments. Petitioner should be
deemed in substantial compliance with the procedural requirements.
Rules of procedure must be adopted to help promote, not frustrate, substantial justice. The Court frowns upon the practice of
dismissing cases purely on procedural grounds. Considering that there was substantial compliance, a liberal interpretation of
procedural rules in this labor case is more in keeping with the constitutional mandate to secure social justice.
2) YES. Under the Rules of Procedure of the NLRC, an appeal from the decision of the labor arbiter should be filed within 10
days from receipt thereof. Petitioner’s claim that respondents filed their appeal beyond the required period is not substantiated.
In the pleadings before us, petitioner fails to indicate when respondents received the Decision of the labor arbiter. Neither did
the petitioner attach a copy of the challenged appeal. Thus, this Court has no means to determine from the records when the
10-day period commenced and terminated.
3) NO. 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.”
IRR of Labor Code provides for the following conditions to be a managerial employee:

a) Their primary duty consists of the management of the establishment in which they are employed or of a department or
subdivision thereof;
b) They customarily and regularly direct the work of two or more employees therein;

c) They have the authority to hire or fire other employees of lower rank; or their suggestions and recommendations as to the
hiring and firing and as to the promotion or any other change of status of other employees are given particular weight.
Petitioner is not a managerial employee, but a member of the managerial staff, which also takes him out of coverage of
labor standards. IRR provides for duties and responsibilities of members of managerial staff:

a) The primary duty consists of the performance of work directly related to management policies of the employer;

b) Customarily and regularly exercise discretion and independent judgment;

c) (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

d) 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.
As shift engineer, petitioner’s duties and responsibilities include supervising, checking and monitoring manpower
workmanship as well as operation of boiler and accessories; evaluating performance of machinery and manpower; training new
employees for effectivity and safety while working; and recommending personnel actions such as promotion or disciplinary
actions.
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. In his Position Paper, 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. Petitioner’s 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 respondent’s
354 employees who were paid on a monthly basis; the others were paid only on a daily basis.

Royal Plant Workers Union v. Coca-Cola Bottlers Philippines, Inc. – Cebu Plant
G.R. No. 198783, 15 April 2013

Facts:
Petitioner Coca-Cola Bottlers Philippines, Inc. (CCBPI) is a domestic corporation engaged in the manufacture, sale and
distribution of soft drink products. It has several bottling plants all over the country, one of which is located in Cebu City. Under the
employ of each bottling plant are bottling operators. In the case of the plant in Cebu City, there are 20 bottling operators who work for
its Bottling Line 1 while there are 12-14 bottling operators who man its Bottling Line 2. All of them are male and they are members of
herein respondent Royal Plant Workers Union (ROPWU).
 The bottling operators work in two shifts. The first shift is from 8 a.m. to 5 p.m. and the second shift is from 5 p.m. up to the
time production operations is finished. Thus, the second shift varies and may end beyond eight (8) hours. However, the bottling operators
are compensated with overtime pay if the shift extends beyond eight (8) hours. For Bottling Line 1, 10 bottling operators work for each
shift while 6 to 7 bottling operators work for each shift for Bottling Line 2.
Each shift has rotations of work time and break time. Prior to September 2008, the rotation is this: after two and a half (2 ½)
hours of work, the bottling operators are given a 30-minute break and this goes on until the shift ends. In September 2008 and up to the
present, the rotation has changed and bottling operators are now given a 30-minute break after one and one half (1 ½) hours of work.
In 1974, the bottling operators of then Bottling Line 2 were provided with chairs upon their request. In 1988, the bottling
operators of then Bottling Line 1 followed suit and asked to be provided also with chairs. Their request was likewise granted. Sometime
in September 2008, the chairs provided for the operators were removed pursuant to a national directive of petitioner.
This directive is in line with the “I Operate, I Maintain, I Clean” program of petitioner for bottling operators, wherein every
bottling operator is given the responsibility to keep the machinery and equipment assigned to him clean and safe. The program reinforces
the task of bottling operators to constantly move about in the performance of their duties and responsibilities.
With this task of moving constantly to check on the machinery and equipment assigned to him, a bottling operator does not
need a chair anymore, hence, petitioner’s directive to remove them. Furthermore, CCBPI rationalized that the removal of the chairs is
implemented so that the bottling operators will avoid sleeping, thus, prevent injuries to their persons. As bottling operators are working
with machines which consist of moving parts, it is imperative that they should not fall asleep as to do so would expose them to hazards
and injuries. In addition, sleeping will hamper the efficient flow of operations as the bottling operators would be unable to perform their
duties competently.
The bottling operators took issue with the removal of the chairs. Through the representation of herein respondent, they initiated
the grievance machinery of the Collective Bargaining Agreement (CBA) in November 2008. Even after exhausting the remedies
contained in the grievance machinery, the parties were still at a deadlock with petitioner still insisting on the removal of the chairs and
respondent still against such measure. As such, respondent sent a Notice to Arbitrate, dated 16 July 2009, to petitioner stating its position
to submit the issue on the removal of the chairs for arbitration.
Nevertheless, before submitting to arbitration the issue, both parties availed of the conciliation/mediation proceedings before
the National Conciliation and Mediation Board (NCMB) Regional Branch No. VII. They failed to arrive at an amicable settlement.
Thus, the process of arbitration continued and the parties appointed the chairperson and members of the Arbitration Committee as
outlined in the CBA. Petitioner and respondent respectively appointed as members to the Arbitration Committee Mr. Raul A. Kapuno,
Jr. and Mr. Luis Ruiz while they both chose Atty. Alice Morada as chairperson thereof. They then executed a Submission Agreement
which was accepted by the Arbitration Committee on 01 October 2009. As contained in the Submission Agreement, the sole issue for
arbitration is whether the removal of chairs of the operators assigned at the production/manufacturing line while performing their duties
and responsibilities is valid or not.
Both parties submitted their position papers and other subsequent pleadings in amplification of their respective stands.
Petitioner argued that the removal of the chairs is valid as it is a legitimate exercise of management prerogative, it does not violate the
Labor Code and it does not violate the CBA it contracted with respondent. On the other hand, respondent espoused the contrary view.
It contended that the bottling operators have been performing their assigned duties satisfactorily with the presence of the chairs; the
removal of the chairs constitutes a violation of the Occupational Health and Safety Standards, the policy of the State to assure the right
of workers to just and humane conditions of work as stated in Article 3 of the Labor Code and the Global Workplace Rights Policy.
On June 11, 2010, the Arbitration Committee rendered a decision in favor of the Royal Plant Workers Union (the Union) and
against CCBPI, the dispositive portion of which reads, as follows: Wherefore, the undersigned rules in favor of ROPWU declaring that
the removal of the operators’ chairs is not valid. CCBPI is hereby ordered to restore the same for the use of the operators as before their
removal in 2008.
The Arbitration Committee ruled, among others, that the use of chairs by the operators had been a company practice for 34
years in Bottling Line 2, from 1974 to 2008, and 20 years in Bottling Line 1, from 1988 to 2008; that the use of the chairs by the operators
constituted a company practice favorable to the Union; that it ripened into a benefit after it had been enjoyed by it; that any benefit being
enjoyed by the employees could not be reduced, diminished, discontinued, or eliminated by the employer in accordance with Article
100 of the Labor Code, which prohibited the diminution or elimination by the employer of the employees’ benefit; and that jurisprudence
had not laid down any rule requiring a specific minimum number of years before a benefit would constitute a voluntary company practice
which could not be unilaterally withdrawn by the employer.
The Arbitration Committee further stated that, although the removal of the chairs was done in good faith, CCBPI failed to
present evidence regarding instances of sleeping while on duty. There were no specific details as to the number of incidents of sleeping
on duty, who were involved, when these incidents happened, and what actions were taken. There was no evidence either of any accident
or injury in the many years that the bottling operators used chairs. To the Arbitration Committee, it was puzzling why it took 34 and 20
years for CCBPI to be so solicitous of the bottling operators’ safety that it removed their chairs so that they would not fall asleep and
injure themselves. Finally, the Arbitration Committee was of the view that, contrary to CCBPI’s position, line efficiency was the result
of many factors and it could not be attributed solely to one such as the removal of the chairs. Not contented with the Arbitration
Committee’s decision, CCBPI filed a petition for review under Rule 43 before the CA.
On May 24, 2011, the CA rendered a contrasting decision which nullified and set aside the decision of the Arbitration
Committee, sustaining the removal of the chairs of the bottling operators from the manufacturing/production line.
The CA held that the removal of the chairs from the manufacturing/production lines by CCBPI is within the province of
management prerogatives; that it was part of its inherent right to control and manage its enterprise effectively; and that since it was the
employer’s discretion to constantly develop measures or means to optimize the efficiency of its employees and to keep its machineries
and equipment in the best of conditions, it was only appropriate that it should be given wide latitude in exercising it.
The CA stated that CCBPI complied with the conditions of a valid exercise of a management prerogative when it decided to
remove the chairs used by the bottling operators in the manufacturing/production lines. The removal of the chairs was solely motivated
by the best intentions for both the Union and CCBPI, in line with the “I Operate, I Maintain, I Clean” program for bottling operators,
wherein every bottling operator was given the responsibility to keep the machinery and equipment assigned to him clean and safe. The
program would reinforce the task of bottling operators to constantly move about in the performance of their duties and responsibilities.
Without the chairs, the bottling operators could efficiently supervise these machineries’ operations and maintenance.
It would also be beneficial for them because the working time before the break in each rotation for each shift was substantially
reduced from two and a half hours (2 ½) to one and a half hours (1 ½) before the 30-minute break. This scheme was clearly advantageous
to the bottling operators as the number of resting periods was increased. CCBPI had the best intentions in removing the chairs because
some bottling operators had the propensity to fall asleep while on the job and sleeping on the job ran the risk of injury exposure and
removing them reduced the risk. The CA added that the decision of CCBPI to remove the chairs was not done for the purpose of defeating
or circumventing the rights of its employees under the special laws, the Collective Bargaining Agreement (CBA) or the general principles
of justice and fair play. It opined that the principles of justice and fair play were not violated because, when the chairs were removed,
there was a commensurate reduction of the working time for each rotation in each shift.
The provision of chairs for the bottling operators was never part of the CBAs contracted between the Union and CCBPI. The
chairs were not provided as a benefit because such matter was dependent upon the exigencies of the work of the bottling operators. As
such, CCBPI could withdraw this provision if it was not necessary in the exigencies of the work, if it was not contributing to the
efficiency of the bottling operators or if it would expose them to some hazards.
 Lastly, the CA explained that the provision of chairs to the bottling operators cannot be covered by Article 100 of the LC on
elimination or diminution of benefits because the employee’s benefits referred to therein mainly involved monetary considerations or
privileges converted to their monetary equivalent.

Issue:
1. Whether Rule 43 of the Rules of Court was an improper remedy and should have been dismissed.
2. Whether the removal of the bottling operators’ chairs from CCBPI’s production lines is a valid exercise of management
prerogative.
3. Whether the rights of the Union under any labor law, the CBA and under general principles for justice and fair play are violated.

Held:
1. No. The Court has already ruled in a number of cases that a decision or award of a voluntary arbitrator is appealable to the CA
via a petition for review under Rule 43.
2. Yes. The 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. The prerogative,
however, is not absolute; it must be exercised in good faith and with due regard to the rights of labor.
In the case, CCBPI removed the operators’ chairs pursuant to a national directive and in line with its “I Operate, I Maintain, I
Clean” program, launched to enable the Union to perform their duties and responsibilities more efficiently. The chairs were not removed
indiscriminately. They were carefully studied with due regard to the welfare of the members of the Union.
The removal of the chairs was compensated by: a) a reduction of the operating hours of the bottling operators from a two-and-
one-half (2 ½)-hour rotation period to a one-and-a half (1 ½) hour rotation period; and b) an increase of the break period from 15-30
minutes between rotations.
The decision to remove the chairs was to avoid instances of operators sleeping on the job while in the performance of their
duties and because of the fact that the chairs were not necessary considering that the operators constantly move about while working. It
was designed to increase work efficiency. Lack of proof of any operator sleeping on the job is of no moment.
3. No. There is no law that requires employers to provide chairs for bottling operators. The CA correctly ruled that the Labor
Code, specifically Article 132 thereof, only requires employers to provide seats for women. No similar requirement is mandated for men
or male workers. It must be stressed that all concerned bottling operators in this case are men.
There was no violation either of the Health, Safety and Social Welfare Benefit provisions under Book IV of the Labor Code of
the Philippines. As shown in the foregoing, the removal of the chairs was compensated by the reduction of the working hours and
increase in the rest period. The directive did not expose the bottling operators to safety and health hazards.
As to the CBA, contains no provision whatsoever requiring the management to provide chairs for the operators in the
production/manufacturing line while performing their duties and responsibilities. On the contrary, Sec. 2 of Art. 1 of the CBA expressly
provides as follows: x x x On the other hand, all such benefits and/or privileges as are not expressly provided for in this Agreement but
which are now being accorded, may in the future be accorded, or might have previously been accorded, to the employees and/or workers,
shall be deemed as purely voluntary acts on the part of the COMPANY in each case, and the continuance and repetition thereof now or
in the future, no matter how long or how often, shall not be construed as establishing an obligation on the part of the COMPANY.
Since the matter of the chairs is not expressly stated in the CBA, it is understood to be a purely voluntary act on the part of
CCBPI and the did not convert it into an obligation in favor of the Union.
As to the general principles of justice and fair play, there’s no violation at all because the bottling operators’ working time was
considerably reduced and the break period, when they could sit down, was increased. The bottling operators’ new work schedule is
certainly advantageous to them because it greatly increases their rest period and significantly decreases their working time.
And as to Art. 100 of the LC, the operators’ chairs cannot be considered as one of the employee benefits covered. The term “benefits”
mentioned in the non-diminution rule refers to monetary benefits or privileges given to the employee with monetary equivalents. Such
benefits or privileges form part of the employees’ wage, salary or compensation making them enforceable obligations.

FAR EAST AGRICULTURAL SUPPLY vs. LEBATIQUE

G.R. No. 162813 | February 12, 2007
Facts:
1. Petitioner Far East Agricultural Supply, Inc. (Far East) hired on March 4, 1996 private respondent Jimmy Lebatique as truck driver.
He delivered animal feeds to the company’s clients.

2. On January 24, 2000, 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. That same day, Manuel Uy, brother of Far East’s General Manager
and petitioner Alexander Uy, suspended Lebatique apparently for illegal use of company vehicle. Even so, Lebatique reported for
work the next day but he was prohibited from entering the company premises.
3. On January 26, 2000, Lebatique sought the assistance of the DOLE Public Assistance and Complaints Unit concerning the
nonpayment of his overtime pay. According to Lebatique, two days later, he received a telegram from petitioners requiring him
to report for work. When he did the next day, January 29, 2000, Alexander asked him why he was claiming overtime pay. Lebatique
explained that he had never been paid for overtime work since he started working for the company. He also told Alexander
that Manuel had fired him. After talking to Manuel, Alexander terminated Lebatique and told him to look for another job.
4. On March 20, 2000, Lebatique filed a complaint for illegal dismissal and nonpayment of overtime pay. The Labor Arbiter
found that Lebatique was illegally dismissed, and ordered his reinstatement and the payment of his full back wages, 13th month
pay, service incentive leave pay, and overtime pay.
5. NLRC reversed. CA reinstated LA ruling, holding that Lebatique was not a field personnel and therefore entitled to overtime pay,
service incentive leave pay and 13th month pay. Hence, this petition.
6. Petitioners contend, among others, that Lebatique was merely suspended; that Lebatique is estopped from claiming that he was
illegally dismissed since his complaint before the DOLE was only on the nonpayment of his overtime pay. Also, petitioners maintain
that Lebatique, as a driver, is not entitled to overtime pay since he is a field personnel whose time outside the company premises
cannot be determined with reasonable certainty. According to petitioners, the drivers do not observe regular working hours unlike
the other office employees. The drivers may report early in the morning to make their deliveries or in the afternoon, depending on
the production of animal feeds and the traffic conditions. Petitioners also aver that Lebatique worked for less than eight hours a day.
Issues:
1) Whether Lebatique was illegally dismissed.
 2) Whether Lebatique was a field personnel not entitled to overtime pay.
Ratio Decidendi:
1) YES. 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 a 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 Lebatique to sever the employer-employee relationship. When Lebatique was verbally told by Alexander Uy, the
company’s 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 Lebatique’s dismissal that it was Lebatique’s 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. An employee who takes steps to protest his layoff cannot by any stretch of
imagination be said to have abandoned his work and the filing of the complaint is proof enough of his desire to return to work,
thus negating any suggestion of abandonment.

2) NO. Under Article 82 of the Labor code, the provisions on Working Conditions and Rest Periods shall not apply to field
personnel. 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 employee’s performance is unsupervised by the employer.
Field personnel are those who regularly perform their duties away from the principal place of business of the employer and
whose actual hours of work in the field cannot be determined with reasonable certainty. Thus, in order to 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 employee’s time and
performance are constantly supervised by the employer.
As correctly found by the CA, Lebatique is not a field personnel 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 client’s 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.
[Mukhang importante din ito] Note that all money claims arising from an employer-employee relationship shall be filed
within three years from the time the cause of action accrued; otherwise, they shall be forever barred. Further, if it is established
that the benefits being claimed have been withheld from the employee for a period longer than three years, the amount
pertaining to the period beyond the three-year prescriptive period is therefore barred by prescription. The amount that can only
be demanded by the aggrieved employee shall be limited to the amount of the benefits withheld within three years before the
filing of the complaint.

Lebatique timely filed his claim for service incentive leave pay, considering that in this situation, the prescriptive period
commences at the time he was terminated. On the other hand, his claim regarding nonpayment of overtime pay since he was
hired in March 1996 is a different matter. In the case of overtime pay, he can only demand for the overtime pay withheld for
the period within three years preceding the filing of the complaint on March 20, 2000. However, we find insufficient the
selected time records presented by petitioners to compute properly his overtime pay. The Labor Arbiter should have required
petitioners to present the daily time records, payroll, or other documents in management’s control to determine the correct
overtime pay due Lebatique.

Jose Rizal College v. NLRC G.R. No. L-65482, 1 December 1987

Facts:
Petitioner is a non-stock, non-profit educational institution duly organized and existing under the laws of the Philippines. It has
three groups of employees categorized as follows: (a) personnel on monthly basis, who receive their monthly salary uniformly
throughout the year, irrespective of the actual number of working days in a month without deduction for holidays; (b) personnel on daily
basis who are paid on actual days worked and they receive unworked holiday pay and (c) collegiate faculty who are paid on the basis of
student contract hour.
Before the start of the semester they sign contracts with the college undertaking to meet their classes as per schedule. Unable
to receive their corresponding holiday pay, as claimed, from 1975 to 1977, private respondent National Alliance of Teachers and Office
Workers (NATOW) in behalf of the faculty and personnel of Jose Rizal College filed with the Ministry of Labor a complaint against
the college for said alleged non-payment of holiday pay, docketed as Case No. RO4-10-81-72. Due to the failure of the parties to settle
their differences on conciliation, the case was certified for compulsory arbitration where it was docketed as RB-IV- 23037-78.
After the parties had submitted their respective position papers, the Labor Arbiter rendered a decision on February 5, 1979, the
dispositive portion of which reads: "WHEREFORE, judgment is hereby rendered as follows: The faculty and personnel of the respondent
Jose Rizal College who are paid their salary by the month uniformly in a school year, irrespective of the number of working days in a
month, without deduction for holidays, are presumed to be already paid the 10 paid legal holidays and are no longer entitled to separate
payment for the said regular holidays; The personnel of the respondent Jose Rizal College who are paid their wages daily are entitled to
be paid the 10 unworked regular holidays according to the pertinent provisions of the Rules and Regulations Implementing the Labor
Code; Collegiate faculty of the respondent Jose Rizal College who by contract are paid compensation per student contract hour are not
entitled to unworked regular holiday pay considering that these regular holidays have been excluded in the programming of the student
contact hours.''
On appeal, respondent National Labor Relations Commission in a decision promulgated on June 2, 1982, modified the decision
appealed from, in the sense that teaching personnel paid by the hour are declared to be entitled to holiday pay. Hence, this petition.
Issue:
1. Whether the school faculty who according to their contracts are paid per lecture hour are entitled to unworked holiday pay.
2. Whether the petitioners were deprived of due process.
Held:
1. No. Subject holiday pay is provided for in the Labor Code, which 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 ten (10) workers; The employer may require an employee to work on any
holiday but such employee shall be paid a compensation equivalent to twice his regular rate; x x" and in the Implementing Rules and
Regulations, Rule IV, Book III, which reads:
"SEC. 8. Holiday pay of certain employees. — (a) Private school teachers, including faculty members of colleges and
universities, may not be paid for the regular holidays during semestral vacations. They shall, however, be paid for the regular holidays
during Christmas vacations. x x"
Under the foregoing provisions, apparently, the petitioner, although a non-profit institution is under obligation to give pay even
on unworked regular holidays to hourly paid faculty members subject to the terms and conditions provided for therein.
The Court believes that the aforementioned implementing rule is not justified by the provisions of the law which after all is
silent with respect to faculty members paid by the hour who because of their teaching contracts are obliged to work and consent to be
paid only for work actually done (except when an emergency or a fortuitous event or a national need calls for the declaration of special
holidays). Regular holidays specified as such by law are known to both school and faculty members as "no class days;" certainly the
latter do not expect payment for said unworked days, and this was clearly in their minds when they entered into the teaching contracts.
On the other hand, both the law and the Implementing Rules governing holiday pay are silent as to payment on Special Public
Holidays. It is readily apparent that the declared purpose of the holiday pay which is the prevention of diminution of the monthly income
of the employees on account of work interruptions is defeated when a regular class day is cancelled on account of a special public
holiday and class hours are held on another working day to make up for time lost in the school calendar. Otherwise stated, the faculty
member, although forced to take a rest, does not earn what he should earn on that day.
When a special public holiday is declared, the faculty member paid by the hour is deprived of expected income, and it does not
matter that the school calendar is extended in view of the days or hours lost, for their income that could be earned from other sources is
lost during the extended days. Similarly, when classes are called off or shortened on account of typhoons, floods, rallies, and the like,
these faculty members must likewise be paid, whether or not extensions are ordered.
2. No. the "cardinal primary" requirements of due process in administrative proceedings, to wit: "(1) the right to a hearing
which includes the right to present one's case and submit evidence in support thereof; (2) the tribunal must consider the evidence
presented; (3) the decision must have something to support itself; (4) the evidence must be substantial, and substantial evidence means
such evidence as a reasonable mind might accept as adequate to support a conclusion; (5) the decision must be based on the evidence
presented at the hearing, or at least contained in the record and disclosed to the parties affected; (6) the tribunal or body of any of its
judges must act on its or his own independent consideration of the law and facts of the controversy, and not simply accept the views of
a subordinate; (7) the board or body should in all controversial questions, render its decisions in such manner that the parties to the
proceeding can know the various issues involved, and the reason for the decision rendered."
The records show petitioner JRC was amply heard and represented in the instant proceedings. It submitted its position paper
before the Labor Arbiter and the NLRC and even filed a motion for reconsideration of the decision of the latter, as well as an "Urgent
Motion for Hearing En Banc" Thus, petitioner's claim of lack of due process is unfounded.

MAKATI HABERDASHERY, INC., vs. NATIONAL LABOR RELATIONS COMMISSION

Facts:

Individual complainants, private respondents herein, have been working for petitioner Makati Haberdashery, Inc. as tailors,
seamstress, sewers, basters (manlililip) and "plantsadoras". They are paid on a piece-rate basis except Maria Angeles and Leonila
Serafina who are paid on a monthly basis. In addition to their piece-rate, they are given a daily allowance of three (P 3.00) pesos
provided they report for work before 9:30 a.m. everyday.

Private respondents are required to work from or before 9:30 a.m. up to 6:00 or 7:00 p.m. from Monday to Saturday and during peak
periods even on Sundays and holidays.

On July 20, 1984, the Sandigan ng Manggagawang Pilipino, a labor organization of the respondent workers, filed a complaint
docketed as NLRC NCR Case No. 7-2603-84 for (a) underpayment of the basic wage; (b) underpayment of living allowance; (c) non-
payment of overtime work; (d) non-payment of holiday pay; (e) non-payment of service incentive pay; (f) 13th month pay; and (g)
benefits provided for under Wage Orders Nos. 1, 2, 3, 4 and 5.

During the pendency of NLRC NCR Case No. 7-2603-84, private respondent Dioscoro Pelobello left with Salvador Rivera, a
salesman of petitioner Haberdashery, an open package which was discovered to contain a "jusi" barong tagalog. When confronted,
Pelobello replied that the same was ordered by respondent Casimiro Zapata for his customer. Zapata allegedly admitted that he copied
the design of petitioner Haberdashery. But in the afternoon, when again questioned about said barong, Pelobello and Zapata denied
ownership of the same. Consequently a memorandum was issued to each of them to explain on or before February 4, 1985 why no
action should be taken against them for accepting a job order which is prejudicial and in direct competition with the business of the
company. Both respondents allegedly did not submit their explanation and did not report for work. Hence, they were dismissed by
petitioners on February 4, 1985. They countered by filing a complaint for illegal dismissal docketed as NLRC NCR Case No. 2-428-
85 on February 5, 1985.

Judgment is hereby rendered in NLRC NCR Case No. 2-428-85 finding respondents guilty of illegal dismissal and ordering them to
reinstate Dioscoro Pelobello and Casimiro Zapata to their respective or similar positions without loss of seniority rights, with full
backwages from July 4, 1985 up to actual reinstatement. The charge of unfair labor practice is dismissed for lack of merit. The
complainants' claims for underpayment re violation of the minimum wage law is hereby ordered dismissed for lack of merit.
Respondents are hereby found to have violated the decrees on the cost of living allowance, service incentive leave pay and the 13th
Month Pay. In view thereof, the economic analyst of the Commission is directed to compute the monetary awards due each
complainant based on the available records of the respondents retroactive as of three years prior to the filing of the instant case.

Issues:

I W/N AN EMPLOYER-EMPLOYEE RELATIONSHIP EXISTS BETWEEN PETITIONER HABERDASHERY AND

RESPONDENTS WORKERS.

II W/N RESPONDENTS WORKERS ARE ENTITLED TO MONETARY CLAIMS DESPITE THE FINDING THAT THEY ARE
NOT ENTITLED TO MINIMUM WAGE.

III W/N RESPONDENTS PELOBELLO AND ZAPATA WERE ILLEGALLY DISMISSED.

Ruling:

Yes. The first issue which is the pivotal issue in this case is resolved in favor of private respondents. We have repeatedly held in
countless decisions that the test of employer-employee relationship is four-fold: (1) the selection and engagement of the employee; (2)
the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's conduct. It is the so called "control test"
that is the most important element. This simply means the determination of whether the employer controls or has reserved the right to
control the employee not only as to the result of the work but also as to the means and method by which the same is to be
accomplished.

The facts at bar indubitably reveal that the most important requisite of control is present. As gleaned from the operations of petitioner,
when a customer enters into a contract with the haberdashery or its proprietor, the latter directs an employee who may be a tailor,
pattern maker, sewer or "plantsadora" to take the customer's measurements, and to sew the pants, coat or shirt as specified by the
customer. Supervision is actively manifested in all these aspects — the manner and quality of cutting, sewing and ironing.

Furthermore, the presence of control is immediately evident in this memorandum issued by Assistant Manager Cecilio B. Inocencio,
Jr. dated May 30, 1981 addressed to Topper's Makati Tailors.

From this memorandum alone, it is evident that petitioner has reserved the right to control its employees not only as to the result but
also the means and methods by which the same are to be accomplished. That private respondents are regular employees is further
proven by the fact that they have to report for work regularly from 9:30 a.m. to 6:00 or 7:00 p.m. and are paid an additional allowance
of P 3.00 daily if they report for work before 9:30 a.m. and which is forfeited when they arrive at or after 9:30 a.m.

Yes. There is no dispute that private respondents are entitled to the Minimum Wage as mandated in Section 3(f), Rules Implementing
Presidential Decree 1713 which explicitly states that, "All employees paid by the result shall receive not less than the applicable new
minimum wage rates for eight (8) hours work a day, except where a payment by result rate has been established by the Secretary of
Labor. ..." No such rate has been established in this case.

But all these notwithstanding, the question as to whether or not there is in fact an underpayment of minimum wages to private
respondents has already been resolved in the decision of the Labor Arbiter where he stated: "Hence, for lack of sufficient evidence to
support the claims of the complainants for alleged violation of the minimum wage, their claims for underpayment re violation of the
Minimum Wage Law under Wage Orders Nos. 1, 2, 3, 4, and 5 must perforce fall."

The records show that private respondents did not appeal the above ruling of the Labor Arbiter to the NLRC; neither did they file any
petition raising that issue in the Supreme Court. Accordingly, insofar as this case is concerned, that issue has been laid to rest. As to
private respondents, the judgment may be said to have attained finality. For it is a well-settled rule in this jurisdiction that "an appellee
who has not himself appealed cannot obtain from the appellate court-, any affirmative relief other than the ones granted in the decision
of the court below. "

As a consequence of their status as regular employees of the petitioners, they can claim cost of living allowance. This is apparent from
the provision defining the employees entitled to said allowance, thus: "... All workers in the private sector, regardless of their position,
designation or status, and irrespective of the method by which their wages are paid. "

Private respondents are also entitled to claim their 13th Month Pay under Section 3(e) of the Rules and Regulations Implementing
P.D. No. 851 which provides:

Section 3. Employers covered. — The Decree shall apply to all employers except to:

(e) Employers of those who are paid on purely commission, boundary, or task basis, and those who are paid a fixed amount for
performing a specific work, irrespective of the time consumed in the performance thereof, except where the workers are paid on piece-
rate basis in which case the employer shall be covered by this issuance insofar as such workers are concerned.

On the other hand, while private respondents are entitled to Minimum Wage, COLA and 13th Month Pay, they are not entitled to
service incentive leave pay because as piece-rate workers being paid at a fixed amount for performing work irrespective of time
consumed in the performance thereof, they fall under one of the exceptions stated in Section 1(d), Rule V, Implementing Regulations,
Book III, Labor Code. For the same reason private respondents cannot also claim holiday pay (Section 1(e), Rule IV, Implementing
Regulations, Book III, Labor Code).

No, it is apparent that public respondents have misread the evidence, for it does show that a violation of the employer's rules has been
committed and the evidence of such transgression, the copied barong tagalog, was in the possession of Pelobello who pointed to
Zapata as the owner. When required by their employer to explain in a memorandum issued to each of them, they not only failed to do
so but instead went on AWOL (absence without official leave), waited for the period to explain to expire and for petitioner to dismiss
them. They thereafter filed an action for illegal dismissal on the far-fetched ground that they were dismissed because of union
activities. Assuming that such acts do not constitute abandonment of their jobs as insisted by private respondents, their blatant
disregard of their employer's memorandum is undoubtedly an open defiance to the lawful orders of the latter, a justifiable ground for
termination of employment by the employer expressly provided for in Article 283(a) of the Labor Code as well as a clear indication of
guilt for the commission of acts inimical to the interests of the employer, another justifiable ground for dismissal under the same
Article of the Labor Code, paragraph (c). Well established in our jurisprudence is the right of an employer to dismiss an employee
whose continuance in the service is inimical to the employer's interest.

In fact the Labor Arbiter himself to whom the explanation of private respondents was submitted gave no credence to their version and
found their excuses that said barong tagalog was the one they got from the embroiderer for the Assistant Manager who was
investigating them, unbelievable.Under the circumstances, it is evident that there is no illegal dismissal of said employees. Thus, We
have ruled that:

No employer may rationally be expected to continue in employment a person whose lack of morals, respect and loyalty to his
employer, regard for his employer's rules, and appreciation of the dignity and responsibility of his office, has so plainly and
completely been bared.

The law is protecting the rights of the laborer authorizes neither oppression nor self-destruction of the employer. 17 More importantly,
while the Constitution is committed to the policy of social justice and the protection of the working class, it should not be supposed
that every labor dispute will automatically be decided in favor of labor.
FEDERICO M. LEDESMA, JR. vs. NATIONAL LABOR RELATIONS COMMISSION

Facts:

On 4 December 1998, petitioner was employed as a bus/service driver by the private respondent on probationary basis, as evidenced
by his appointment.3 As such, he was required to report at private respondent’s training site in Dasmariñas, Cavite, under the direct
supervision of its site administrator, Pablo Manolo de Leon (de Leon).

On 11 November 2000, petitioner filed a complaint against de Leon for allegedly abusing his authority as site administrator by using
the private respondent’s vehicles and other facilities for personal ends. In the same complaint, petitioner also accused de Leon of
immoral conduct allegedly carried out within the private respondent’s premises. A copy of the complaint was duly received by private
respondent’s Chief Accountant, Nita Azarcon (Azarcon).5

On 27 November 2000, de Leon filed a written report against the petitioner addressed to private respondent’s Vice-President for
Administration, Ricky Ty (Ty), citing his suspected drug use.

In view of de Leon’s report, private respondent’s Human Resource Manager, Trina Cueva (HR Manager Cueva), on 29 November
2000, served a copy of a Notice to petitioner requiring him to explain within 24 hours why no disciplinary action should be imposed
on him for allegedly violating Section 14, Article IV of the private respondent’s Code of Conduct.6

On 3 December 2000, petitioner filed a complaint for illegal dismissal against private respondent before the Labor Arbiter.

In his Position Paper,7 petitioner averred that in view of the complaint he filed against de Leon for his abusive conduct as site
administrator, the latter retaliated by falsely accusing petitioner as a drug user. VP for Administration Ty, however, instead of
verifying the veracity of de Leon’s report, readily believed his allegations and together with HR Manager Cueva, verbally dismissed
petitioner from service on 29 November 2000.

Petitioner alleged that he was asked to report at private respondent’s main office in España, Manila, on 29 November 2000. There,
petitioner was served by HR Manager Cueva a copy of the Notice to Explain together with the copy of de Leon’s report citing his
suspected drug use. After he was made to receive the copies of the said notice and report, HR Manager Cueva went inside the office of
VP for Administration Ty. After a while, HR Manager Cueva came out of the office with VP for Administration Ty. To petitioner’s
surprise, HR Manager Cueva took back the earlier Notice to Explain given to him and flatly declared that there was no more need for
the petitioner to explain since his drug test result revealed that he was positive for drugs. When petitioner, however, asked for a copy
of the said drug test result, HR Manager Cueva told him that it was with the company’s president, but she would also later claim that
the drug test result was already with the proper authorities at Camp Crame.8Petitioner was then asked by HR Manager Cueva to sign a
resignation letter and also remarked that whether or not petitioner would resign willingly, he was no longer considered an employee of
private respondent. All these events transpired in the presence of VP for Administration Ty, who even convinced petitioner to just
voluntarily resign with the assurance that he would still be given separation pay. Petitioner did not yet sign the resignation letter
replying that he needed time to think over the offers. When petitioner went back to private respondent’s training site in Dasmariñas,
Cavite, to get his bicycle, he was no longer allowed by the guard to enter the premises.9

On the following day, petitioner immediately went to St. Dominic Medical Center for a drug test and he was found negative for any
drug substance. With his drug result on hand, petitioner went back to private respondent’s main office in Manila to talk to VP for
Administration Ty and HR Manager Cueva and to show to them his drug test result. Petitioner then told VP for Administration Ty and
HR Manager Cueva that since his drug test proved that he was not guilty of the drug use charge against him, he decided to continue to
work for the private respondent.

On 2 December 2000, petitioner reported for work but he was no longer allowed to enter the training site for he was allegedly banned
therefrom according to the guard on duty. This incident prompted the petitioner to file the complaint for illegal dismissal against the
private respondent before the Labor Arbiter.

For its part, private respondent countered that petitioner was never dismissed from employment but merely served a Notice to Explain
why no disciplinary action should be filed against him in view of his superior’s report that he was suspected of using illegal drugs.
Instead of filing an answer to the said notice, however, petitioner prematurely lodged a complaint for illegal dismissal against private
respondent before the Labor Arbiter.

Private respondent likewise denied petitioner’s allegations that it banned the latter from entering private respondent’s premises.
Rather, it was petitioner who failed or refused to report to work after he was made to explain his alleged drug use. Indeed, on 3
December 2000, petitioner was able to claim at the training site his salary for the period of 16-30 November 2000, as evidenced by a
copy of the pay voucher bearing petitioner’s signature. Petitioner’s accusation that he was no longer allowed to enter the training site
was further belied by the fact that he was able to claim his 13th month pay thereat on 9 December 2000, supported by a copy of the
pay voucher signed by petitioner.

On 26 July 2002, the Labor Arbiter rendered a Decision,13 in favor of the petitioner declaring illegal his separation from employment.
The Labor Arbiter, however, did not order petitioner’s reinstatement for the same was no longer practical, and only directed private
respondent to pay petitioner backwages.

On 15 April 2003, the NLRC granted the appeal raised by both parties and reversed the Labor Arbiter’s Decision.17 The NLRC
declared that petitioner failed to establish the fact of dismissal for his claim that he was banned from entering the training site was
rendered impossible by the fact that he was able to subsequently claim his salary and 13th month pay. Petitioner’s claim for
reinstatement was, however, granted by the NLRC.

The Court of Appeals dismissed petitioner’s Petition for Certiorari under Rule 65 of the Revised Rules of Court, and affirmed the
NLRC Decision giving more credence to private respondent’s stance that petitioner was not dismissed from employment, as it is more
in accord with the evidence on record and the attendant circumstances of the instant case. Similarly ill-fated was petitioner’s Motion
for Reconsideration, which was denied by the Court of Appeals in its Resolution issued on 7 September 2006.

Issue: w/n there is illegal dismissal

Ruling:

No. In the present case, there is hardly any evidence on record so as to meet the quantum of evidence required, i.e., substantial
evidence. Petitioner’s claim of illegal dismissal is supported by no other than his own bare, uncorroborated and, thus, self-serving
allegations, which are also incoherent, inconsistent and contradictory.

Petitioner himself narrated that when his presence was requested on 29 November 2000 at the private respondent’s main office where
he was served with the Notice to Explain his superior’s report on his suspected drug use, VP for Administration Ty offered him
separation pay if he will just voluntarily resign from employment. While we do not condone such an offer, neither can we construe
that petitioner was dismissed at that instance. Petitioner was only being given the option to either resign and receive his separation pay
or not to resign but face the possible disciplinary charges against him. The final decision, therefore, whether to voluntarily resign or to
continue working still, ultimately rests with the petitioner. In fact, by petitoner’s own admission, he requested from VP for
Administration Ty more time to think over the offer.

Moreover, the petitioner alleged that he was not allowed to enter the training site by the guard on duty who told him that he was
already banned from the premises. Subsequently, however, petitioner admitted in his Supplemental Affidavit that he was able to return
to the said site on 3 December 2000, to claim his 16-30 November 2000 salary, and again on 9 December 2000, to receive his 13th
month pay. The fact alone that he was able to return to the training site to claim his salary and benefits raises doubt as to his purported
ban from the premises.

Finally, petitioner’s stance that he was dismissed by private respondent was further weakened with the presentation of private
respondent’s payroll bearing petitioner’s name proving that petitioner remained as private respondent’s employee up to December
2000. Again, petitioner’s assertion that the payroll was merely fabricated for the purpose of supporting private respondent’s case
before the NLRC cannot be given credence. Entries in the payroll, being entries in the course of business, enjoy the presumption of
regularity under Rule 130, Section 43 of the Rules of Court. It is therefore incumbent upon the petitioner to adduce clear and
convincing evidence in support of his claim of fabrication and to overcome such presumption of regularity. Unfortunately, petitioner
again failed in such endeavor.

It is true that the Constitution affords full protection to labor, and that in light of this Constitutional mandate, we must be vigilant in
striking down any attempt of the management to exploit or oppress the working class. However, it does not mean that we are bound to
uphold the working class in every labor dispute brought before this Court for our resolution.

The law in protecting the rights of the employees, authorizes neither oppression nor self-destruction of the employer. It should be
made clear that when the law tilts the scales of justice in favor of labor, it is in recognition of the inherent economic inequality
between labor and management. The intent is to balance the scales of justice; to put the two parties on relatively equal positions. There
may be cases where the circumstances warrant favoring labor over the interests of management but never should the scale be so tilted
if the result is an injustice to the employer. Justitia nemini neganda est -- justice is to be denied to none.

Rodriguez vs. Park N Ride, Inc. | GR No. 222980

Facts:

On October 7, 2009, Rodriguez filed a Complaint for constructive illegal dismissal, non-payment of service incentive leave
pay and 13th month pay, including claims for moral and exemplary damages and attorney's fees against Park N Ride, Vicest Phils.,
Grand Leisure, and the Javier Spouses.

In her Position Paper, Rodriguez alleged that she was employed on January 30, 1984 as Restaurant Supervisor at Vicest Phils.
Four (4) years later, the restaurant business closed. Rodriguez was transferred to office work and became an Administrative and Finance
Assistant to Estelita Javier. One of Rodriguez's duties was to open the office in Makati City at 8:00 a.m. daily.

The Javier Spouses established other companies. Rodriguez was also required to handle the personnel and administrative
matters of these companies without additional compensation. She likewise took care of the household concerns of the Javier Spouses,
such as preparing payrolls of drivers and helpers, shopping for household needs, and looking after the spouses' house whenever they
travelled abroad.

Sometime in 2000, the Javier Spouses established Park N Ride, a business that provided terminal parking and leasing. Although
the company's main business was in Lawton, Manila, its personnel and administrative department remained in Makati City. Rodriguez
handled the administrative, finance, and warehousing departments of Park N Ride. Every Saturday, after opening the Makati office at
8:00 a.m., Rodriguez was required to report at the Lawton office at 11:00 a.m. to substitute the Head Cashier, who would be on day-off.

She allegedly worked from 8:00 a.m. to 7:00 p.m., Mondays to Saturdays; was on call on Sundays; and worked during
Christmas and other holidays. She was deducted an equivalent of two (2) days' wage for every day of absence and was not paid any
service incentive leave pay. On one occasion, Rodriguez asked the Javier Spouses if she could go home by 10:00 a.m. to attend a family
reunion, but her request was denied.

The Javier Spouses' treatment of Rodriguez became unbearable; thus, on March 25, 2009, she filed her resignation letter
effective April 25, 2009. The Javier Spouses allegedly did not accept her resignation and convinced her to reconsider and stay on.
However, her experience became worse. Rodriguez claimed that toward the end of her employment, Estelita was always unreasonable
and hot-headed, and would belittle and embarrass her in the presence of co-workers.

On September 22, 2009, Rodriguez went on her usual "pamalengke" for the Spouses. Later, she proceeded to open the Makati
office. Estelita was mad at her when they finally talked over the phone, berating her for opening the office late. She allegedly told her
that if she did not want to continue with her work, the company could manage without her.

Thus, Rodriguez did not report for work the next day, and on September 26, 2009, she wrote the Javier Spouses a
letter expressing her gripes at them. She intimated that they were always finding fault with her to push her to resign. On October 6,
2009, the Javier Spouses replied to her letter, allegedly accepting her resignation.
Rodriguez prayed for separation pay in lieu of reinstatement; full back wages; service incentive leave pay; proportional 13th month pay;
moral damages of P100,000.00; exemplary damages of P100,000.00; and attorney's fees.

In their Position Paper, Javier Spouses stated that in 1984, they hired Rodriguez as a nutritionist in their fast food business.
Vicest (Phils) Inc., the spouses' construction business, hired Rodriguez as an employee when the fast food business closed. When the
construction business became slow, Park N Ride hired Rodriguez as Administrative Officer.

Javier Spouses trusted Rodriguez with both their businesses and personal affairs, and this made her more senior than any of her
colleagues at work. She was given authority to transact with business and banking institutions and became a signatory to their bank
accounts. She was also given custody over the deeds and titles of ownership over properties of the Javier Spouses.

However, Rodriguez was allegedly emotionally sensitive and prone to occasional "tampo" when she would be reprimanded or
cited for tasks unaccomplished. She would then be absent after such reprimands and would eventually return after a few days.

On September 22, 2009, the Javier Spouses inquired from Rodriguez about an overdue contract with a vendor. Rodriguez
offered no explanation for the delay, and other employees heard her say that she was going to resign.

On September 23, 2009, Rodriguez did not report for work. On September 26, 2009, when she still has not reported for work
after three days, a letter was sent to her citing her continued and unauthorized absence. "She was told that her resignation could not be
processed because she had not completed her employment clearance and she was unable to properly turnover her tasks to her
assistant." She was asked to report on September 30, 2009 or, at the very least, to reply in writing on or before October 7, 2009.Rodriguez
neither reported for work on September 30, 2009 nor submitted any reply to the letter sent to her.

Rodriguez allegedly continued to ignore the requests for her to complete the turnover of her tasks and responsibilities and
refused to cooperate in tracing the documents in her custody. Corollary to this, it was discovered that the company check books were
missing; that Rodriguez had unliquidated cash advances of not less than P500,000.00; and that two (2) checks were deposited in her
personal account amounting to P936,000.00.

The Javier Spouses claimed that Rodriguez was not entitled to service incentive leave pay, moral and exemplary damages,
attorney's fees and director's fee. They averred that they were willing to pay Rodriguez the 13th month pay differentials, as soon as
Rodriguez completed her clearance.

On May 26, 2010, Labor Arbiter dismissed Rodriguez's Complaint for lack of merit. According to the Decision, the summary
of evidence pointed to the voluntariness of Rodriguez's resignation rather than the existence of a hostile and frustrating working
environment. The Javier Spouses were ordered to pay Rodriguez her proportionate 13th month pay for 2009.

Rodriguez appealed to the NLRC. The Commission granted Rodriguez's appeal and modified Labor Arbiter’s Decision. The
Commission ruled that Rodriguez was illegally dismissed and awarded her back wages, separation pay, 13th month pay differentials,
moral and exemplary damages, and attorney's fees.

However, on the Javier Spouses' Motion for Reconsideration, the Commission set aside its May 30, 2011 Decision and
reinstated Labor Arbiter’s Decision.

Rodriguez filed a Motion for Reconsideration, which was denied by the Commission. Rodriguez filed a Rule 65 Petition before
the CA imputing grave abuse of discretion on the NLRC.

The CA held that there was no constructive dismissal, but rather Rodriguez voluntarily resigned from her employment.
Rodriguez sought reconsideration. The CA denied the motion. Hence, this Petition.

Issue: WON petitioner was constructively dismissed.

Held:

No. There is constructive dismissal when an employer’s act of clear discrimination, insensibility or disdain becomes so
unbearable on the part of the employee so as to foreclose any choice on his part except to resign from such employment. It exists where
there is involuntary resignation because of the harsh, hostile and unfavorable conditions set by the employer. We have held that the
standard for constructive dismissal is “whether a reasonable person in the employee’s position would have felt compelled to give up his
employment under the circumstances.” The unreasonably harsh conditions that compel resignation on the part of an employee must be
way beyond the occasional discomforts brought about by the misunderstandings between the employer and employee. Strong words
may sometimes be exchanged as the employer describes her expectations or as the employee narrates the conditions of her work
environment and the obstacles she encounters as she accomplishes her assigned tasks. As in every human relationship, there are bound
to be disagreements.

However, when these strong words from the employer happen without palpable reason or are expressed only for the purpose
of degrading the dignity of the employee, then a hostile work environment will be created. In a sense, the doctrine of constructive
dismissal has been a consistent vehicle by this Court to assert the dignity of labor. However, this is not the situation in this case.
The National Labor Relations Commission did not commit a grave abuse of discretion in finding that petitioner was not
constructively dismissed but that she voluntarily resigned from employment. Petitioner’s unequivocal intent to relinquish her position
was manifest when she submitted her letters of resignation. The resignation letters dated May 1, 2008 and March 25, 2009 contained
words of gratitude, which could hardly come from an employee forced to resign. These letters were reinforced by petitioner’s very own
act of not reporting for work despite respondents’ directive.

From the representation of petitioner, what triggered her resignation was the incident on September 22, 2009 when Estelita told
her “Kung ayaw mo na ng ginagawa mo, we can manage!” These words, however, are not sufficient to make the continued employment
of petitioner impossible, unreasonable, or unlikely.
The Court of Appeals correctly observed that the utterance of Estelita was more a consequence of her spontaneous outburst of
feelings resulting from petitioner’s failure to perform a task that was long overdue, rather than an act to force petitioner to resign from
work. It appears that petitioner was asked to finish assigned tasks and liquidate cash advances.
Petitioner was neither terminated on September 22, 2009 nor was she constructively dismissed. There was no showing of bad
faith or malicious design by the respondents that would make her work conditions unbearable. On the other hand, it is a fact that
petitioner enjoyed the privilege of working closely with the Javier Spouses and having their full trust and confidence. Spontaneous
expressions of an employer do not automatically render a hostile work atmosphere. The circumstances in this case negate its presence.
Abduljuahid R. Pigcaulan v. Security | GR No. 173648

Facts:

Canoy and Pigcaulan were both employed by SCII as security guards and were assigned to SCII's different
clients. Subsequently, however, Canoy and Pigcaulan filed with the Labor Arbiter separate complaints for underpayment of salaries
and non-payment of overtime, holiday, rest day, service incentive leave and 13th month pays. These complaints were later on
consolidated as they involved the same causes of action.

Canoy and Pigcaulan, in support of their claim, submitted their respective daily time records reflecting the number of hours
served and their wages for the same. They likewise presented itemized lists of their claims for the corresponding periods served.

Respondents, however, maintained that Canoy and Pigcaulan were paid their just salaries and other benefits under the law; that
the salaries they received were above the statutory minimum wage and the rates provided by the Philippine Association of Detective
and Protective Agency Operators (PADPAO) for security guards; that their holiday pay were already included in the computation of
their monthly salaries; that they were paid additional premium of 30% in addition to their basic salary whenever they were required to
work on Sundays and 200% of their salary for work done on holidays; and, that Canoy and Pigcaulan were paid the corresponding 13th
month pay for the years 1998 and 1999. In support thereof, copies of payroll listings and lists of employees who received their 13th
month pay for the periods December 1997 to November 1998 and December 1998 to November 1999 were presented. In addition,
respondents contended that Canoy's and Pigcaulan's monetary claims should only be limited to the past three years of employment
pursuant to the rule on prescription of claims.

The Labor Arbiter held that the payroll listings presented by the respondents did not prove that Canoy and Pigcaulan were duly
paid as same were not signed by the latter or by any SCII officer. The 13th month payroll was, however, acknowledged as sufficient
proof of payment, for it bears Canoy's and Pigcaulan's signatures. Thus, without indicating any detailed computation of the judgment
award, the Labor Arbiter ordered the payment of overtime pay, holiday pay, service incentive leave pay and proportionate 13th month
pay for the year 2000 in favor of Canoy and Pigcaulan.

Respondents appealed to the NLRC, which sustained the LA’s decision and dismissed the subsequent motion for
reconsideration.

Respondents appealed to the CA which set aside the rulings of both the LA and the NLRC after noting that there were no
factual and legal bases mentioned in the questioned rulings to support the conclusions made. Consequently, it dismissed all the monetary
claims of Canoy and Pigcaulan on the following rationale:

First. The Labor Arbiter disregarded the NLRC rule that, in cases involving money awards and at all events, as far as
practicable, the decision shall embody the detailed and full amount awarded.

Second. The Labor Arbiter found that the payrolls submitted by SCII have no probative value for being unsigned by Canoy,
when, in fact, said payrolls, particularly the payrolls from 1998 to 1999 indicate the individual signatures of Canoy.

Third. The Labor Arbiter did not state in his decision the substance of the evidence adduced by Pigcaulan and Canoy as well
as the laws or jurisprudence that would show that the two are indeed entitled to the salary differential and incentive leave pays.

Fourth. The Labor Arbiter held Reyes liable together with SCII for the payment of the claimed salaries and benefits despite
the absence of proof that Reyes deliberately or maliciously designed to evade SCII's alleged financial obligation; hence the Labor Arbiter
ignored that SCII has a corporate personality separate and distinct from Reyes. To justify solidary liability, there must be an allegation
and showing that the officers of the corporation deliberately or maliciously designed to evade the financial obligation of the corporation.

Canoy and Pigcaulan filed a Motion for Reconsideration, but same was denied by the CA. Hence, this petition.

Issue: WON the CA erred when it dismissed the complaint allegedly due to absence of legal and factual bases despite attendance of
substantial evidence in the records.

Held:

No. It is well to note that while the caption of the petition reflects both the names of Canoy and Pigcaulan as petitioners, it
appears from its body that it is being filed solely by Pigcaulan. In fact, the Verification and Certification of Non-Forum Shopping was
executed by Pigcaulan alone. Thus, since it was only Pigcaulan who filed the petition, the CA Decision has already become final and
binding upon Canoy.

There was no substantial evidence to support the grant of overtime pay. The Court find that both the Labor Arbiter and the
NLRC erred in this regard. The handwritten itemized computations are self-serving, unreliable and unsubstantial evidence to sustain
the grant of salary differentials, particularly overtime pay. Unsigned and unauthenticated as they are, there is no way of verifying the
truth of the handwritten entries stated therein. Written only in pieces of paper and solely prepared by Canoy and Pigcaulan, these
representative daily time records, as termed by the Labor Arbiter, can hardly be considered as competent evidence to be used as basis
to prove that the two were underpaid of their salaries. We find nothing in the records which could substantially support Pigcaulan's
contention that he had rendered service beyond eight hours to entitle him to overtime pay and during Sundays to entitle him to restday
pay. Hence, in the absence of any concrete proof that additional service beyond the normal working hours and days had indeed been
rendered, we cannot affirm the grant of overtime pay to Pigcaulan.

Pigcaulan is entitled to holiday pay, service incentive leave pay and proportionate 13th month pay for year 2000. As employer,
SCII has the burden of proving that it has paid these benefits to its employees.

SCII presented payroll listings and transmittal letters to the bank to show that Canoy and Pigcaulan received their salaries as
well as benefits which it claimed are already integrated in the employees' monthly salaries. However, the documents presented do not
prove SCII's allegation. SCII failed to show any other concrete proof by means of records, pertinent files or similar documents reflecting
that the specific claims have been paid. With respect to 13th month pay, SCII presented proof that this benefit was paid but only for the
years 1998 and 1999. To repeat, the burden of proving payment of these monetary claims rests on SCII, being the employer. It is a rule
that one who pleads payment has the burden of proving it. "Even when the plaintiff alleges non-payment, still the general rule is that
the burden rests on the defendant to prove payment, rather than on the plaintiff to prove non-payment." Since SCII failed to provide
convincing proof that it has already settled the claims, Pigcaulan should be paid his holiday pay, service incentive leave benefits and
proportionate 13th month pay for the year 2000.

Indeed, the Labor Arbiter failed to provide sufficient basis for the monetary awards granted. Such failure, however, should not
result in prejudice to the substantial rights of the party. While we disallow the grant of overtime pay and rest day pay in favor of
Pigcaulan, he is nevertheless entitled, as a matter of right, to his holiday pay, service incentive leave pay and 13th month pay for year
2000. Hence, the CA is not correct in dismissing Pigcaulan's claims in its entirety. Consistent with the rule that all money claims arising
from an employer-employee relationship shall be filed within three years from the time the cause of action accrued, Pigcaulan can only
demand the amounts due him for the period within three years preceding the filing of the complaint in 2000. Furthermore, since the
records are insufficient to use as bases to properly compute Pigcaulan's claims, the case should be remanded to the Labor Arbiter for a
detailed computation of the monetary benefits due to him.

Labor Congress of Philippines For vs NLRC | GR No. 123938

Facts:

The 99 persons named as petitioners in this proceeding were rank-and-file employees of respondent Empire Food Products,
which hired them on various dates. Petitioners filed against Empire and NLRC complaint for payment of money claims and for violation
of labor standards laws. Alongside this they also filed a petition for direct certification for the Labor Congress to be their bargaining
representative. On Oct. 23, 1990, petitioners represented by LCP, and private respondents Gonzalo and Evelyn Kehyeng (Kehyeng
spouses) entered into a Memorandum of Agreement, recognizing the following:

 Status of LCP as sole and exclusive Bargaining Agent and Representative for all rank and file employees of the Empire Food
Products regarding "wages, hours of work, and other terms and conditions of employment";
 With regard to the NLRC complaint, all parties agree to resolve the issues during the Collective Bargaining Agreement;
 Proper adjustment of wages, withdrawal of case from the Calendar of NLRC, non-interference or any ULP act, etc.

On Oct. 24, 1990, the Mediator Arbiter approved the memorandum and certified LCP as the sole and exclusive bargaining agent for the
rank-and-file employees of Empire.

On November 1990, LCP President Navarro submitted to Empire a proposal for collective bargaining. However, on January 1991, the
private petitioners Ana Marie et al filed a complaint for:

 Unfair Labor Practices via Illegal Lockout and Dismissal;

 Union-Busting through harassment, threats and interference to the right for self-organization;
 Violation of the Oct. 23, 1990 memorandum
 Underpayment of wages
 Actual, moral and exemplary damages

After the submission by the parties of their respective position papers and presentation of testimonial evidence, LA absolved
private respondents of the charges of unfair labor practice, union busting, violation of the memorandum of agreement, underpayment
of wages and denied petitioners’ prayer for actual, moral and exemplary damages. LA, however, directed the reinstatement of the
individual complainants except those who resigned and executed quitclaims and releases prior to the filing of this complaint.

On appeal, the NLRC Remanded case to Labor Arbiter for further proceedings due to overlooking “…the testimonies of some
of the individual complainants which are now on record”.

The case was dismissed by the LA stating that Complainants failed to present with definiteness and clarity the particular act or
acts constitutive of unfair labor practice, declaration of Unfair Labor Practices connotes a finding of prima facie evidence of probability
that a criminal offense may have been committed so as to warrant the filing of a criminal information before the regular court. As regards
the issue of harassment, threats and interference with the rights of employees to self-organization which is actually an ingredient of
unfair labor practice, complainants failed to specify what type of threats or intimidation was committed and who committed the same.
Affirmed by the NLRC stating that (a) there was a dearth of evidence to prove the existence of unfair labor practice and union busting
on the part of private respondents; (b) the agreement of 23 October 1990 could not be made the basis of an obligation within the ambit
of the NLRC’s jurisdiction, as the provisions thereof, particularly Section 2, spoke of a resolutory condition which could or could not
happen; (c) the claims for underpayment of wages were without basis as complainants were admittedly “pakiao” workers and paid on
the basis of their output subject to the lone limitation that the payment conformed to the minimum wage rate for an eight-hour workday;
and (d) petitioners were not underpaid. Their motion for reconsideration having been denied by the NLRC, hence, this petition.

Issue: WON the petitioners are entitled to labor standard benefits, considering their status as piece rate workers.

Held:

Yes. petitioners are entitled to labor standards benefits, namely, holiday pay, premium pay, 13 th month pay and service incentive
leave. Supreme Court decision cites that petitioners, despite being “pakyao” or piece workers does not imply that they are not regular
employees entitled to reinstatement. Applying the two-fold test from LC Article 286(n) [Art. 280 (old)], the SC found that the supposedly
piece workers had three factors in their favor:

a) The nature of the tasks of Ana Marie, et al of repacking snack food items was NECESSARY and DESIRABLE in the usual
business of Empire Foods, which is a food and fruit processing company. According to Tabas vs California Manufacturing,
merchandisers of processed food who coordinates for sales of processed food was a necessity and was desirable for the day-to-
day operations of a food processing company. With more reason would the job of food packers be necessary for the day-to-day
operations of a food processing plant.
b) Ana Marie et al worked throughout the year, with their employment being independent from a specific project or season.
c) The length of time that petitioners fulfilled the requirement of Article 286(n).

Therefore, the SC considered the employees as regular employees despite their status as piece workers, according them benefits such as
holiday pay, premium pay, 13th month pay and service incentive leave.
 The Rules Implementing the Labor Code exclude certain employees from receiving benefits such as nighttime pay, holiday
pay, service incentive leaves and 13th month pay, inter alia, "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." However, petitioners as piece-
rate workers do not fall within this group. Not only did the employees labor under the control of Empire, the employees also worked
throughout the year to fulfil their quota as “basis for compensation”.

Further, in Section 8 (b), Rule IV, Book III, piece workers are specifically mentioned as being entitled to holiday pay.

In addition, the Revised Guidelines on the Implementation of the 13th Month Pay Law, in view of the modifications to P.D.
No. 851 19 by Memorandum Order No. 28, clearly exclude the employer of piece rate workers from those exempted from paying 13th
month pay.

They should also be paid for overtime pay, even though Sec. 2(e), Rule I, Book III of the Implementing Rules states that:

“…workers who are paid by results including those who are paid on piece-work, takay, pakiao, or task basis, if their output
rates are in accordance with the standards prescribed under Sec. 8, Rule VII, Book III, of these regulations, or where such rates
have been fixed by the Secretary of Labor in accordance with the aforesaid section, are not entitled to receive overtime pay.”

In this case, Empire Foods did not allege that they adhered
 to
 the
 standards
 set forth
 in
 Sec. 8, Rule VII, Book III,
nor
 with
 the
 rates
 prescribed
 by
 the
 Secretary
 of
 Labor. Therefore, even though they are piece workers, they are entitled
to overtime pay.

With regard to the issue of abandonment of work, the SC cited the Office of Solicitor General’s observations:

In finding that petitioner employees abandoned their work, the Labor Arbiter and the NLRC relied on the testimony of Security
Guard Rolando Cairo that on January 21, 1991, petitioners refused to work. As a result of their failure to work, the cheese
curls ready for repacking on said date were spoiled…

… The failure to work for one day, which resulted in the spoilage of cheese curls does not amount to abandonment of work. In
fact two (2) days after the reported abandonment of work or on January 23, 1991, petitioners filed a complaint for, among
others, unfair labor practice, illegal lockout and/or illegal dismissal.

Furthermore, the SC stressed that the burden of proving the existence of just cause for dismissing an employee, such as
abandonment, rests on the employer. According to the SC, Empire Foods failed to discharge this burden as basis for dismissing the
employees.

Also, the SC considered that, in terminating the employees for abandonment of work, Empire failed to serve to the employees
a written notice of termination (as required by the Two-Notice rule and Section 2, Rule XIV, Book V of the Omnibus Rules), violating
the employees’ right to security of tenure and the constitutional right to due process.