No. L-16275. February 23, 1961.
Appeal by certiorari from the decision of the
PAN AMERICAN WORLD AIRWAYS SYSTEM
(PHILIPPINES) , petitioner, vs. PAN AMERICAN
EMPLOYEES ASSOCIATION, respondent.
Courts; Court of Industrial Relations;
Jurisdiction; Employer and employee; Overtime
pay; Eight-Hour Labor Law.—Where the
claimants, at the time of the f iling of the claim
for overtime pay, were still in the service of the
employer, or, having been separated from
service, should also ask for reinstatement, the
claim must be brought before the Court of
Industrial Relations; otherwise, such claim
should be brought before the regular courts.
Same; When meal period is part of overtime
work.—Where during the so-called meal period,
the" laborers are required to stand by for
emergency work, or where said meal hour is not
one of complete rest, such period is considered
overtime.
Same; Computation by CIR's examining division
is not an undue delegation of judicial function;
Judgments.—The computation of overtime pay
involves, at the most, a mechanical act, and its
being computed by the Chief Examining.
Division of the Industrial Court is not an undue
delegation of its judicial function. The lack of a
specific amount of overtime pay in the decision
does not render it incomplete.
PETITION for review by certiorari of a decision
and a resolution of the Court of Industrial
Relations.
The facts are stated in the opinion of the Court.
Ross, Selph & Carrascoso for petitioner.
Jose Espinas for respondent.
REYES, J.B.L., J.:
representative to compute the overtime pay;
Court of Industrial Relations in Case No. 1055-
V dated October 10, 1959, and its resolution en
banc denying the motion for reconsideration
filed by the petitioner herein.
The dispositive portion of the appealed decision
reads:
"WHEREFORE, the Court orders the Chief of the
Examining Division or his representative to
compute the overtime compensation due the
aforesaid fourteen (14) aircraft mechanics and
the two employees from the Communication
Department, based on the time sheet of said
employees from February 23, 1952 up to and
including July 15, 195S and to submit his report
within 30 days for further disposition by the
Court; and the company shall show to the Court
Examiner such time sheets and other
documents that may be necessary in the
aforesaid computation; and two (2)
representatives for the company and two (2)
representatives for the union shall be chosen to
help the Court Examiner in said computation.
"The company is also ordered to permanently
adopt the straight 8-hour shift inclusive of meal
period which is mutually beneficial to the
parties.
"SO ORDERED."
In this appeal, petitioner advances five
propositions which, briefly, are as follows: (1)
the Industrial Court has no jurisdiction to order
the payment of overtime compensation, it being
a mere monetary claim cognizable by regular
courts; (2) the finding that the one-hour meal
period should be considered overtime work
(deducting 15 minutes as time allotted for
eating) is not supported by substantial
evidence; (3) the court below had no authority
to delegate its judicial functions by ordering the
Chief of the Examining Division or his
(4) the finding that there was no agreement to
withdraw Case No. 1055-V in consideration of
the wage increases in the Collective Bargaining
Contract (Exh. "A") is not supported by
substantial evidence; and (5) the court below
had no authority to order the company to adopt
a straight 8-hour shift inclusive of meal period.
On the issue of jurisdiction over claims for
overtime pay, we have since definitely ruled in
a number of recent decisions that the Industrial
Court may properly take cognizance of such
cases if, at the time of the petition, the
complainants were still in the service of the
employer, or, having been separated from such
service, should ask for reinstatement;
otherwise, such claims should be brought before
the regular courts, (NASSCO v. CIR, et al.,
L13888, April 29, 1960; FRISCO v. CIR, et al.,
L-13806, May 23, 1960; Board of Liquidators, et
al. vs. CIR, et al., L15485, May 23, 1960; Sta.
Cecilia Sawmills Co. vs. CIR, L-14254 & L-
14255, May 27, 1960; Ajax International Corp.
v Seguritan, L-16038, October 25, 1960;
Sampaguita Pictures, Inc., et al. vs. CIR, L-
16404, October 25, 1960). Since, in the instant
case there is no question that the employees
claiming overtime compensation were still in the
service of the company when the case was filed,
the jurisdiction of the Court of Industrial
Relations cannot be assailed. In fact, since it is
not pretended that, thereafter, the
complainants were discharged or otherwise
terminated their relationship with the company
for any reason, all of said complainants could
still be with the company up to the present.
Petitioner herein claims that the one-hour meal
period should not be considered as overtime
work (after deducting 15 minutes), because the
evidence showed that complainants could rest
completely, and were not in any manner under
the control of the company during that period.
The court below found, on the contrary, that
during the so-called meal period, the mechanics
were required to stand by for emergency work;
that if they happened not to be available when
called, they were reprimanded by the leadman;
that as in fact it happened on many occasions,
the mechanics had been called from their meals
or told to hurry up eating to perform work
during this period. Far from being unsupported
by substantial evidence, the record clearly
confirms the above factual findings of the
Industrial Court.
Similarly, this Court is satisfied with the finding
that there was no agreement to withdraw Case
No. 1055-V in consideration of the wage
increases obtained by the union and set forth in
the Collective Bargaining Agreement Exhibit
"A". As reasoned out by the court below, such
alleged agreement would have been
incorporated in the contract if it existed. The
fact that the union filed a motion to dismiss
without prejudice, after the Collective
Bargaining Contract had been signed, did not
necessarily mean that it had agreed to withdraw
the case in consideration of the wage increases.
The motion itself (Annex "B", Petition for
Certiorari) was expressly based on an
understanding that the company would
"formulate a schedule of work which shall be in
consonance with C. A. 444", All in all, there is
substantial evidence in the record to support the
finding of the court below that no such
agreement was made.
It is next contended that in ordering the Chief
of the Examining Division or his representative
to compute the compensation due, the
Industrial Court unduly delegated its judicial
functions and thereby rendered an incomplete
decision. We do not believe so. Computation of
the overtime pay involves a mechanical
function, at most. And the report would still
have to be submitted to the Industrial Court for
its approval, by the very terms of the order
itself. That there was no specification of the
amount of overtime pay in the decision did not
make it incomplete, since this matter would
necessarily be made clear enough in the
implementation of the decision (see Malate
Taxicab & Garage, Inc. vs. CIR, et al., L-8718,
May 11, 1956).
The Industrial Court's order for permanent
adoption of a straight 8-hour shift including the
meal period was but a consequence of its finding
that the meal hour was not one of complete
rest, but was actually a work hour, since for its
duration, the laborers had to be on ready call.
Of course, if the Company practices in this
regard should be
modified to afford the mechanics a real rest
during that hour (f. ex., by installing an entirely
different emergency crew, or any similar
arrangement), then the modification of this part
of the decision may be sought from the Court
below. As things now stand, we see no warrant
for altering the decision.
The judgment appealed from is affirmed. Costs
against appellant.
Bengzon, Padilla, Bautista Angelo, Labrador,
Concepcion, Barrera, Paredes and Dizon, JJ.,
concur.
Judgment affirmed. Pan American World
Airways System vs. Pan American Employees
Association, 1 SCRA 527, No. L-16275 February
23, 1961
G.R. No. 75093 February 23, 1990
DELIA R. SIBAL, petitioner,
vs.
NOTRE DAME OF GREATER MANILA,
NATIONAL LABOR RELATIONS
COMMISSION, respondents.
Semproniano S. Ochoco for petitioner.
Williard B. Riano for private respondent.
PARAS, J.:
In this petition for certiorari, petitioner Delia R.
Sibal prays for the reversal of the decision dated
April 11, 1986 of public respondent National
Labor Relations Commission which affirmed the
decision of the Labor Arbiter dated October 8,
1982 awarding to petitioner separation pay but
denied her claim (1) for compensation for
teaching Health subject to 19 sections; (2) for
moral damages; and (3) negating the existence
of unfair labor practice. The within petition
further seeks the reinstatement of petitioner to
her former position as school nurse in
respondent school without loss of seniority
rights with fun backwages from the date of her
illegal dismissal up to the time of actual
reinstatement; and finally, seeks the desistance
of private respondent Notre Dame of Greater
Manila from further committing unfair labor
practice.
The prefatory facts and proceedings as aptly
summed up by the Solicitor General and which
stand undisputed are:
Petitioner Delia R. Sibal was employed as school
nurse by private respondent Notre Dame of
Greater Manila starting January 1973. Prior to
school year 1976-1977, she was compensated
on a 12-month basis, although she worked only
during the ten-month period of classes. She was
not required to report for work for the entire
Christmas and summer vacations. However, on
March 10, 1976, respondent's director, Fr.
Enrique Gonzales, requested her to shorten her
summer vacation, from two weeks after the last
day of classes to two weeks before the first day
of classes of the next school year. Petitioner
acceded to the request (Rec. p. 246).
Sometime in April 1980, Fr. Gonzales required
petitioner to report during that summer to help
in the library. In a letter dated April 11, 1980,
petitioner contested the order, stating that it will
necessitate a change in the terms and
conditions of her employment and that library
work is alien to her profession as nurse (Rec. p.
45). Fr. Gonzales relented.
In November 1980, Fr. Gonzales was replaced
by Fr. Pablo Garcia, an American, as new
director. Fr. Garcia required petitioner to report
for work during the summer before the
beginning of school year 1981-1982. Petitioner
informed him that her contract does not require
her to report for work during the summer
vacation. Fr. Garcia promised to verify her
allegation. However, he failed to inform
petitioner of his findings. Thus, in order that her
failure to report for work may not be
misinterpreted, petitioner filed leaves of
absence extending from April 1, 1981 to June
14, 1981 (Rec. pp. 223-225). Petitioner failed to
receive her vacation pay.
During school year 1981-1982, petitioner was
assigned to teach health subjects to 900
students spread out in nineteen (19) sections of
the entire high school department. This
situation came about because the two (2)
teachers of the health subjects had left the
school. Petitioner, however, was not given
compensation for teaching, notwithstanding the
fact that other teachers were duly compensated
for extra work done. During that school year
petitioner tried to arrange for a meeting with Fr.
Garcia regarding her vacation pay, but to no
avail because Fr. Garcia was always busy. In
October 1981, Fr. Garcia suffered a heart attack
which necessitated his hospitalization. In
December 1981, petitioner received her 13th
month pay which was computed on the basis of
a 10-month period only.
On April 5, 1982, Fr. Garcia again required
petitioner to work during that summer to update
all the clinical records of the students (Rec. p.
242). In a letter dated April 7, 1982, petitioner
objected to the order by reiterating that her
contract does not require her to report for work
during summer. In addition, she reminded Fr.
Garcia that she had not received any
compensation for teaching health subjects the
past school year (Rec. p. 6). On the same day,
Fr. Garcia replied in a letter to the effect that it
was imperative for her to report for work during
the summer because it is the best time to
update the clinical records when no students
could disturb her. Also, petitioner was not
entitled to extra compensation for teaching
because teaching was allegedly part of her
regular working program as a school nurse
(Rec. p. 221).
On April 14, 1982, petitioner, apart from
reiterating her objection to the order, called the
attention of Fr. Garcia to the school's failure to
pay her salary for the summer of 1981 and of
the deficiency in her 13th month pay for that
year (Rec. p. 8). The following day, Fr. Garcia
adamantly refused to consider petitioner's
demands and threatened to take drastic
measures against her if she remains obstinate
in her refusal to follow his order to report for
work that summer (Rec. p. 243). This letter was
followed the next day by a memorandum to the
same effect (Rec. p. 244). In a letter dated April
19, 1982, petitioner, for the fourth time,
informed Fr. Garcia that her contract does not
require her to report for work during summer,
and she does not intend to do so that summer
of 1982 (Rec. p. 241).
Failing to receive the compensation demanded,
May 10, 1982, petitioner filed a complaint for
non-payment of the following; (1) vacation pay
for four (4) summer months; (2) compensation
for teaching health subjects; and (3) deficiency
in the 13th month pay for 1981 (Annexes A, B,
petition). Summons was served on respondent
school on the opening day of classes on June 14,
1982 (Rec. p. 19). That very day when
petitioner reported for work, respondent school
served petitioner her letter of termination
effective immediately and it also submitted a
copy of the termination paper to the Ministry of
Labor and Employment (MOLE) (Rec. pp. 218-
219). The following day, petitioner filed an
amended complaint, adding two more charges:
illegal dismissal and unfair labor practice (Annex
C, D, petition). For the next four to five weeks,
more than 20 teachers and personnel, backed
up by the Faculty Association of respondent
school, pressed for the ouster of Fr. Garcia with
the Ministry of Education, Culture, and Sports
(MECS) by virtue of PD 176 and the following
charges: oppressive behavior, arrogance,
contempt for Filipinos in general and Filipino
teachers in particular; unfairness in dealing with
personnel; dictatorial conduct; and use of
abusive language (See Annexes A to F of Annex
F, petition). Fr. Garcia was eventually replaced
on September 8, 1983.
In the meantime, respondent school filed its
position paper on June 29, 1982, while
petitioner filed hers on July 1, 1982 (Rec. pp.
22, 210). In the hearing of July 13, 1982,
petitioner directed clarificatory questions to
Miss Cristina Sison, corporate secretary of
respondent school (Rec. pp. 57-141). On July
27, 1982, respondent filed its memorandum,
while petitioner filed hers on August 2, 1982
(Rec. pp. 142, 162).
On October 8, 1982, the Labor Arbiter rendered
a decision. Petitioner filed a memorandum of
partial appeal on November 11, 1982 (Annex
F, petition). Respondent filed opposition to the
appeal on January 5, 1983. On January 18,
1983, petitioner filed reply to the opposition. In
an urgent ex parte manifestation dated
September 20, 1983, petitioner informed the
NLRC that Fr. Pablo Garcia had been replaced
by Fr. Jose Arong, a Filipino, as new director
effective September 8, 1983 (Annex
G, petition). On April 11, 1986, public
respondent NLRC rendered the questioned
decision which affirmed the decision of the
Labor Arbiter. (Rollo, pp. 131-136).
Petitioner thus resorted to this petition which
she filed on July 15, 1986.
Petitioner and both the Solicitor General and
public respondent NLRC have narrowed down
the issues for resolution to the following:
1. Whether or not the award of separation pay
instead of reinstatement is the proper remedy
under the circumstances;
2. Whether or not petitioner is entitled to
compensation for teaching health subjects; and
3. Whether or not unfair labor practice existed
which would entitle petitioner to moral
damages.
For the affirmative resolution of the aforestated
issues, petitioner alleges the following:
1. Respondent NLRC failed to give full respect to
the constitutional mandate on security of tenure
when the majority decision affirmed the
decision of the Labor Arbiter separating and, in
effect, dismissing petitioner on the basis of her
perception that petitioner and the director could
no longer work harmoniously. The award of
separation pay would defeat and render
nugatory the Constitutional guaranty of security
of tenure.
2. Petitioner is entitled to compensation relative
to her teaching job which is distinct and
separate from her duties as school nurse.
3. Petitioner was, from the very start, subjected
to harassment and fabricated charges. She had
suffered and continues to suffer from the time
of her dismissal on June 14, 1982 up to the
present. She must be entitled to an award of
moral damages.
Public respondent NLRC, however, submits the
following:
1. The relationship between petitioner and
respondent school had come to the point that
reinstatement of petitioner would cause undue
burden on both parties. It would affect
petitioner's performance of her duties as school
nurse and private respondent's business.
2. Teaching health subjects is allied to
petitioner's job as school nurse, particularly so
when the same is done within the official eight
(8) working hour schedule.
3. Petitioner failed to prove her membership in
a union. There was no union among the
employees of the school in which case the
instances where unfair labor practice may be
committed, with the exception of one instance,
and predicated on the existence of a union,
would not apply. Private respondent has not
been found guilty of unfair labor practice and it,
therefore, follows that she is not entitled to
moral damages.
This Court finds merit in the petition.
The Labor Arbiter herself had found that the
termination of petitioner was not supported by
any just cause or reason. Yet, she erroneously
ordered separation pay instead of reinstatement
with backwages based on the alleged reason
that petitioner's working relations with the
former director, Father Garcia, had become so
strained and deteriorated that it became
impossible for them to work harmoniously
again. And the NLRC affirmed such finding which
is untrue and merely speculative.
It should be noted that the alleged conflict
between the petitioner and the director was
strictly official in nature, the cause of which was
the violation of the terms of employment by the
latter. Petitioner's assertion of her right to
unpaid salaries and bonus differential was not
motivated by any personal consideration.
Rather, she simply claimed benefits which,
under the law, she was entitled to and legally
due her. In her act of asserting these money
claims, petitioner observed utmost tact,
courtesy and civility so as not to unduly offend
the sensibilities of the director by waiting for his
frill recovery from his illness before sending her
formal letter of demand; and only after the
school refused to satisfy her money claims did
she file the formal complaint with the proper
NLRC branch. Ironically, however, the director
gave her a downright shabby treatment by
terminating her services without prior notice
and without first filing a case against her
wherein she could have defended herself . The
school did not even give credit to her more than
nine (9) years of continuous service. Petitioner's
termination was a blatant disregard of due
process and Constitutional guarantee of
protection to labor.
Thus, in the case of Callanta v. Carnation
Philippines, Inc. (145 SCRA 268), this Court
held that one's employment, profession, trade
or calling is a "property right", and the wrongful
interference therewith is an actionable wrong.
The right is considered to be property within the
protection of a constitutional guaranty of due
process of law.
Significantly, about a month after petitioner's
termination on June 14, 1982, more than
twenty teachers and personnel of respondent
school, backed by the Faculty Association,
petitioned for the ouster of Director Fr. Garcia
for serious charges under P.D. 176.
Consequently, Fr. Garcia was replaced on
September 8, 1983. Clearly, therefore, when
the assailed NLRC decision was rendered on
April 11, 1986, the alleged "strained relations"
or "irritant factors" which the Labor Arbiter
capitalized on had been totally eliminated.
Respondent NLRC obviously failed to consider
this and thus perpetuated the error committed
by the Labor Arbiter in her prior decision. The
eventual replacement of Fr. Garcia all the more
confirmed the discriminatory and oppressive
treatment which he gave petitioner.
The dissenting NLRC Commissioner aptly
observed thus:
Moreover, it should be emphasized, that no
strained relations should arise from a valid and
legal act of asserting ones right, such as in the
instant case, for otherwise, an employee who
shall assert his/ her right could be easily
separated from the service by merely paying
his/her separation pay on the pretext that
his/her relationship with his/her employer had
already become strained.
To Our mind, strained relations in order that it
may justify the award of separation pay in lieu
of reinstatement with backwages, should be
such, that they are so compelling and so serious
in character, that the continued employment of
an employee is so obnoxious to the person or
business of the employer, and that the
continuation of such employment has become
inconsistent with peace and tranquility which is
an Ideal atmosphere in every workplace. (pp.
98-99, Rollo)
The respondent NLRC erred is sustaining the
Labor Arbiter's ruling that petitioner is not
entitled to compensation for teaching health
subjects allegedly because petitioner taught
during her regular working hours; the subject
Health is allied to her profession as nurse; and
she and respondent school had no clear
understanding regarding extra compensation.
The Solicitor General who normally and
expectedly speaks for the NLRC has ably refuted
the position taken by the latter. The Court thus
finds valid and decisive the following submission
of the Solicitor General:
It is submitted, however, that petitioner is
entitled to compensation for teaching health
subjects. Although the subject taught is Health
and allied to her profession, and is taught during
regular working hours, petitioner's teaching the
subject in the classroom and her administering
to the health needs of students in the clinic
involve two different and distinct jobs. They
cannot be equated with each other for they refer
to different functions. Teaching requires
preparation of lesson plans, examinations and
grades, while clinical work entails preparation of
clinical records and treating illnesses of students
in school. There can be no doubt that teaching
health subjects is extra work for petitioner, and
therefore necessitates extra compensation.
After all it has been the practice of the school to
pay extra compensation to teachers who were
given extra load even during regular working
hours (Annex G of Annex F, Petition). The fact
that respondent school failed to produce the
records of those teachers prove that they were
paid for extra work. Hence, petitioner should
likewise be paid compensation. (pp. 138-139,
Rollo)
It must be noted that petitioner has established
that in several precedents, non-teaching
personnel of respondent school who were made
to handle teaching jobs were actually paid
actual compensation. Besides, justice and
equity demand that since the principle of equal
work has long been observed in this jurisdiction,
then it should follow that an extra pay for extra
work should also be applied.
Significantly, this Court has enunciated in the
care of University of Pangasinan Faculty Union
v. University of Pangasinan (127 SCRA 691)
that semestral breaks may be considered as
"hours worked" under the Rules implementing
the Labor Code and that regular professors and
teachers are entitled to ECOLA during the
semestral breaks, their "absence" from work not
being of their own will.
The records show that when summons with
attached complaint of petitioner for money
claims was served on respondent school on June
14, 1982, said respondent, on the very day,
gave petitioner her walking papers. Respondent
did not waste any time in dismissing her in
brazen violation of these provisions of the Labor
Code, as amended:
Art. 118 of the Labor Code provides:
Retaliatory measures. — It shall be unlawful for
an employer to refuse to pay or reduce the
wages and benefits, discharges or in any
manner discriminate against any employee who
has filed any complaint or instituted any
proceeding under this Title or has testified or is
about to testify in such proceedings. (Emphasis
supplied)
Thus, too, Art. 249 (f) provides:
Art. 249. Unfair tabor practice of employers. —
It shall be unlawful for an employer to commit
any of the following unfair labor practice.
xxx xxx xxx
xxx xxx xxx
(f) to dismiss, discharge, or otherwise prejudice
or discriminate against an employee for having
given or being about to give testimony under
this Code,
xxx xxx xxx
For the aforestated violations, respondent
becomes liable under Arts. 289 and 290 of the
same Code.
This Court has, time and again, condemned
illegal termination of services of employees.
In Remerco Garments Manufacturing v. Minister
of Labor and Employment (135 SCRA 167), it
declared that while it is true that it is the sole
prerogative of the management to dismiss or
lay-off an employee, the exercise of such a
prerogative, however, must be made without
abuse of discretion, for what is at stake is not
only private respondent's position (petitioner in
this case) but also his means of livelihood.
In arguing for petitioner's entitlement to moral
damages, the Solicitor General has aptly
summed up her plight. The Solicitor General has
submitted this valid justification for the award
of moral damages under Art. 1701 of the Labor
Code:
Petitioner had been the subject of discrimination
for over a year before she was ultimately
dismissed. When she justifiably refused to obey
the order to report for work for two summers,
she was not given her vacation pay for both
occasions. Unlike her, the doctor and dentist
who worked in the same clinic, were not
required to report during summer and were
given their respective vacation pay. Again,
petitioner, unlike the teachers who accepted
extra load, was not given extra compensation
when she taught health subjects to 900
students for one year. By withholding such
compensation, respondent school stood to gain
at the expense of petitioner, the amount of the
salary which it could have paid to two (2) health
teachers. Petitioner's 13th month pay was
likewise underpaid because the basis for
computation was only ten months, and not one
year as in the case of other regular office
personnel. Finally, petitioner's travails
culminated in her unceremonious termination
without due process at the beginning of the
school year on June 14, 1982, by the service of
her termination paper antedated June 11, 1982.
Termination without due process is specifically
prohibited by Rule XIV Section 1 under Section
8 of the Rules Implementing BP Blg. 130:
Security of tenure and due process. — No
worker shall be dismissed except for a just or
authorized cause provided by law and after due
process.
The series of discriminatory and oppressive acts
of respondent school against petitioner
invariably makes respondent liable for moral
damages under Art. 1701, which prohibits acts
of capital or labor against each other, and Art.
21 on human relations in relation to Art. 2219
No. 10 and Art. 2220, all of the Civil Code
(Philippine Refining Co., Inc. v. Garcia, 18 SCRA
107). (Rollo, pp. 140-141)
WHEREFORE, the appealed decision of
respondent NLRC is hereby SET ASIDE. Private
respondent is hereby ordered to REINSTATE
petitioner to her former position without loss of
seniority rights and with backwages for three
(3) years from the time of her illegal dismissal;
to pay her the regular extra compensation
relative to her teaching health subjects; and to
pay her moral damages, the amount of which
shall be determined by respondent NLRC. Let
this case be remanded to the NLRC for the
proper implementation of this decision.
SO ORDERED.
G.R. No. L-9265 April 29, 1957
LUZON STEVEDORING CO., INC., petitioner,
vs.
LUZON MARINE DEPARTMENT UNION and
THE HON. MODESTO CASTILLO, THE HON.
JOSE S. BAUTISTA, THE HON. V. JIMENEZ
YANSON and THE HON. JUAN L. LANTING,
Judges of the Court of Industrial
Relations, respondents.
Perkins, Ponce Enrile and Associates for
petitioner.
Mariano B. Tuason for respondent Judge of the
Court of Industrial Relations.
Sioson, Roldan and Vidanes for respondent
union.
FELIX, J.:
This case involves a petition for certiorari filed
by the Luzon Stevedoring Co., Inc., to review a
resolution dated June 5, 1955, issued by the
Court of Industrial Relations. On September 5,
1955, with leave of court, a supplemental
petition was filed by said petitioner, and both
petitions were given due course by resolution of
this Court of September 15, 1955. The facts of
the case may be summarized as follows:
On June 21, 1948, herein respondent Luzon
Marine Department Union filed a petition with
the Court of Industrial Relations containing
several demands against herein petitioner
Luzon Stevedoring Co., Inc., among which were
the petition for full recognition of the right of
COLLECTIVE bargaining, close shop and check
off. However, on July 18, 1948, while the case
was still pending with the CIR, said labor union
declared a strike which was ruled down as illegal
by this Court in G.R. No. L-2660 promulgated
on May 30, 1950. In view of said ruling, the
Union filed a "Constancia" with the Court of
Industrial Relations praying that the remaining
unresolved demands of the Union presented in
their original petition, be granted. Said
unresolved demands are the following:
a. Point No. 2.
That the work performed in excess of eight (8)
hours he paid an overtime pay of 50 per cent
the regular rate of pay, and that work
performed on Sundays and legal holidays be
paid double the regular rate of pay.
b. Point No. 7.
That all officers, engineers and crew members
of motor tugboats who have not received their
pay corresponding to the second half of
December, 1941, be paid accordingly.
c. Point No. 11.
That Ciriaco Sarmiento, Chief Mate, M/V Marlin,
Rafael Santos, Port Engineer, and Lorenzo de la
Cruz, Chief Engineer, M/V Shark who have been
suspended without justifiable cause and for
union activities, be reinstated with pay from
time of suspension.
d. Point No. 12.
That all officers, engineers and crew members
of the motor tugboats "Shark", "Hearing", "Pike"
and "Ray", who have been discharged without
justifiable cause and for union activities, be
reinstate with pay from time of discharge. (p.
65-66, Record).
On the basis of these demands, the case was
set for hearing and the parties submitted their
respective evidence, both oral and
documentary, from June 8,1951, to January 7,
1954. In one of the hearings of the case, the
original intervenor in Union de Obreros
Estibadores de Filipinas (UOEF), through
counsel, moved for the withdraw al of said Union
from the case, which motion was granted by the
Court.
After the parties had submitted exhaustive
memoranda, the trial Judge rendered a decision
on February 10, 1955, finding that the company
gave said employees 3 free meals every day and
about 20 minutes rest after each mealtime; that
they worked from 6:00 am. to 6:00 p.m. every
day including Sundays and holidays, and for
work performed in excess of 8 hours, the
officers, patrons and radio operators were given
overtime pay in the amount of P4 each and P2
each for the rest of the crew up to March, 1947,
and after said date, these payments were
increased to P5 and P2.50, respectively, until
the time of their separation or the strike of July
19, 1948; that when the tugboats underwent
repairs, their personnel worked only 8 hours a
day excluding Sundays and holidays; that
although there was an effort on the part of
claimants to show that some had worked
beyond 6:00 p.m., the evidence was uncertain
and indefinite and that demand was, therefore,
denied; that respondent Company, by the
nature of its business and as defined by law
(Section 18-b of Commonwealth Act as
amended) is considered a public service
operator by the Public Service Commission in its
decision in case No. 3035-C entitled "Philippine
Shipowners. Association vs. Luzon Stevedoring
Co., Inc., et al."(Exh. 23), and, therefore,
exempt from paying additional remuneration or
compensation for work performed on Sundays
and legal holidays, pursuant to the provisions of
section 4 of Commonwealth Act No. 444 (Manila
Electric Co. vs. Public Utilities Employees
Association, 79 Phil., 408. 44 Off. Gaz., 1760);
and ruled that:
For the above reasons, the aforementioned
employees are only entitled to receive overtime
pay for work rendered in excess of 8 hours on
ordinary days including Sundays and legal
holidays.
However, the respondent company has proved
to the satisfaction of the Court that it has paid
its employees for such overtime work as shown
above Exhs. 1 to 20-B).
It is, therefore, only a matter of computation
whether such over time pay by the respondent
for overtime services rendered covers the actual
overtime work performed by the employees
concerned equivalent to 25 per cent which is the
minimum rate fixed by law in the absence of
other proof to justify the granting of more
beyond said minimum rate.
Demands Nos. 11 and 12 regarding the
reinstatement to the service of the employees
named therein were denied and respondent
Company was only or to pay the separation pay
and overtime work rendered by Ciriaco
Sarmiento, Rafael Santos and Lorenzo de la
Cruz, after making the pronouncement that
their separation or dismissal was not due to
union activities but for valid and legal grounds.
The Luzon Marine Department Union, through
counsel, therefore, filed a motion for
reconsideration praying that the decision of
February 10, 1955, be modified so as to declare
and rule that the members of the Union who had
rendered services from 6:00 a.m. to 6:00 p.m.
were entitled to 4 hours' overtime pay; that
allotted to the taking of their meals should not
be deducted from the 4 hours of overtime
rendered by said employees, that the amounts
of P3 and P2 set aside for the daily meals of the
employees be considered as part of their actual
compensation in determining the amount due to
said employees separated from the service
without just cause be paid their unearned wages
and salaries from the date of their separation up
to the time the decision in case L-2660 became
final; and for such other relief as may be just
and equitable in the premises.
Luzon Stevedoring Co., Inc. also sought for the
reconsideration of the decision only in so far as
it interpreted that the period during which a
seaman is aboard a tugboat shall be considered
as "working time" for the purpose of the Eight-
Hour-Labor Law.
In pursuance of Section 1 of Commonwealth Act
No. 103, as amended by Commonwealth Act No.
254 and further amended by Commonwealth
Act No. 559, the motions for reconsideration
were passed upon by the Court en banc, and on
June 6, 1955, a resolution modifying the
decision of February 10, 1955, was issued, in
the sense that the 4 hours of overtime work
included in the regular daily schedule of work
from 6:00 a.m. to 6:00 p.m. should be paid
independently of the so-called "coffee-money",
after making a finding that said extra amounts
were given to crew members of some tugboats
for work performed beyond 6:00 p.m. over a
period of some 16 weeks. The Company's
motion for reconsideration was denied.
From this resolution, the Luzon Stevedoring Co.,
Inc. filed the present petition for certiorari and
when the Court of Industrial Relations, acting
upon said Company's motion for clarification,
ruled that the 20 minutes' rest given the
claimants after mealtime should not be
deducted from the 4 hours of overtime worked
performed by said claimants, petitioner filed a
supplemental petition for certiorari dated
September 5, 1955, and both petitions were
given due course by this Court.
Respondent Luzon Marine Labor Union filed
within the reglementary period a motion to
dismiss, which this Court considered as an
answer by resolution of October 14, 1955,
alleging that the decision, resolution and order
of the Court of Industrial Relations sought to be
reviewed by petitioner do not present any
question of law, the issues in said CIR case No.
147-V being purely factual. The respondent
Judges of the Court of Industrial Relations,
represented by counsel, timely filed an answer
likewise asserting that there could have been no
question of law involved or error of law
committed by the said Judges in the resolutions
appealed from, same having been based on
purely findings of fact.
In this instance, petitioner does not seek to alter
the lower court's finding that the regular daily
schedule of work of the members of the herein
respondent Union was from 6:00 a.m. to 6:00
p.m. Petitioner, however, submits several
"issues" which We will proceed to discuss one
after the other. They are the following:
I. Is the definition for "hours of work" as
presently applied to dryland laborers equally
applicable to seamen? Or should a different
criterion be applied by virtue of the fact that the
seamen's employment is completely different in
nature as well as in condition of work from that
of a dryland laborer?
Petitioner questions the applicability to seamen
of the interpretation given to the phrase "hours
of work" for the purpose of the Eight-Hour Labor
Law, insinuating that although the seamen
concerned stayed in petitioner's tugboats, or
merely within its compound, for 12 hours, yet
their work was not continuous but interrupted
or broken. It has been the consistent stand of
petitioner that while it is true that the workers
herein were required to report for work at 6:00
a.m. and were made to stay up to 6:00 p.m.,
their work was not continuous and they could
have left the premises of their working place
were it not for the inherent physical
impossibility peculiar to the nature of their duty
which prevented them from leaving the
tugboats. It is the Company's defense that a
literal interpretation of what constitutes non-
working hours would result in absurdity if made
to apply to seamen aboard vessels in bays and
rivers, and We are called upon to make an
interpretation of the law on "non-working
hours" that may comprehend within its embrace
not only the non-working hours of laborers
employed in land jobs, but also of that particular
group of seamen, i.e., those employed in
vessels plying in rivers and bays, since
admittedly there is no need for such ruling with
respect to officers and crew of interisland
vessels which have aboard 2 shifts of said men
and strictly follow the 8-hour working period.
Section 1 of Commonwealth Act No. 444, known
as the Eight-Hour Labor Law, provides:
SEC. 1. The legal working day for any person
employed by another shall be of not more than
eight hours daily. When the work is not
continuous, the time during which the laborer is
not working AND CAN LEAVE HIS WORKING
PLACE and can rest completely, shall not be
counted.
The requisites contained in this section are
further implemented by contemporary
regulations issued by administrative authorities
(Sections 4 and 5 of Chapter III, Article 1, Code
of Rules and Regulations to Implement the
Minimum Wage Law).
For the purposes of this case, We do not need
to set for seamen a criterion different from that
applied to laborers on land, for under the
provisions of the above quoted section, the only
thing to be done is to determine the meaning
and scope of the term "working place" used
therein. As We understand this term, a laborer
need not leave the premises of the factory, shop
or boat in order that his period of rest shall not
be counted, it being enough that he "cease to
work", may rest completely and leave or may
leave at his will the spot where he actually stays
while working, to go somewhere else, whether
within or outside the premises of said factory,
shop or boat. If these requisites are complied
with, the period of such rest shall not be
counted.
In the case at bar We do not need to look into
the nature of the work of claimant mariners to
ascertain the truth of petitioners allegation that
this kind of seamen have had enough "free
time", a task of which We are relieved, for
although after an ocular inspection of the
working premises of the seamen affected in this
case the trial Judge declared in his decision that
the Company gave the complaining laborers 3
free meals a day with a recess of 20 minutes
after each meal, this decision was specifically
amended by the Court en banc in its Resolution
of June 6, 1955, wherein it held that the
claimants herein rendered services to the
Company from 6:00 a.m. to 6:00 p.m. including
Sundays and holidays, which implies either that
said laborers were not given any recess at all,
or that they were not allowed to leave
the spot of their working place, or that they
could not rest completely. And such resolution
being on a question essentially of fact, this
Court is now precluded to review the same
(Com. Act No. 103, Sec. 15, as amended by
Sec. 2 of Com. Act No. 559; Rule 44 of the Rules
of Court; Kaisahan Ng Mga Manggagawa sa
Kahoy sa Filipinas vs. Gotamco Sawmill, 80
Phil., 521; Operators, Inc. vs. Pelagio, 99 Phil,
893, and others).
II. Should a person be penalized for following an
opinion issued by the Secretary of Justice in the
absence of any judicial pronouncement
whatsoever?
Petitioner cites Opinion No. 247, Series of 1941
of the Secretary of Justice to a query made by
the Secretary of Labor in connection with a
similar subject matter as the one involved, in
this issue, but that opinion has no bearing on
the case at bar because it refers to officers and
crew on board interisland boats whose situation
is different from that of mariners or sailors
working in small tugboats that ply along bays
and rivers and have no cabins or places for
persons that man the same. Moreover, We can
not pass upon this second issue because, aside
from the fact that there appears nothing on
record that would support petitioner's assertion
that in its dealing with its employees, it was
guided by an opinion of the Secretary of Justice,
the issue involves a mere theoretical question.
III. When employees with full knowledge of the
law, voluntarily agreed to work for so many
hours in consideration of a certain definite
wage, and continue working without any protest
for a period of almost two years, is said
compensation as agreed upon legally deemed
and retroactively presumed to constitute full
payment for all services rendered, including
whatever overtime wages might be due?
Especially so if such wages, though received
years before the enactment of the Minimum
Wage Law, were already set mostly above said
minimum wage?
IV. The members set of respondent Union
having expressly manifested acquiescence over
a period of almost two years with reference to
the sufficiency of their wages and having made
no protest whatsoever with reference to said
compensation does the legal and equitable
principle of estoppel operate to bar them from
making a claim for, or making any recovery of,
back overtime compensation?
We are going to discuss these two issues jointly.
Section 6 of Commonwealth Act No. 444
provides:
Sec. 6. Any agreement or contract between the
employer and the laborer or employee contrary
to the provisions of this Act shall be null and
void ab initio.
In the case of the Manila Terminal Co. vs. Court
of Industrial Relations et al., 91 Phil., 625, 48
Off. Gaz., 2725, this Court held:
The principles of estoppel and laches cannot be,
invoked against employees or laborers in an
action for the recovery of compensation for past
overtime work. In the first place, it would be
contrary to the spirit of the Eight-Hour Labor
Law, under which. as already seen, the laborers
cannot waive their right to extra compensation.
In the second place, the law principally obligates
the employer to observe it, so much so that it
punishes the employer for its violation and
leaves the employee free and blameless. In the
third place, the employee or laborer is in such a
disadvantageous position as to be naturally
reluctant or even apprehensive in asserting a
claim which may cause the employer to devise
a way for exercising his right to terminate the
employment.
Moreover, if the principle of estoppel and laches
is to be applied, it would bring about a situation
whereby the employee or laborer, can not
expressly renounce the right to extra
compensation under the Eight-Hour Labor Law,
may be compelled to accomplish the same thing
by mere silence or lapse of time, thereby
frustrating the purpose of the law by indirection.
This is the law on the matter and We certainly
adhere, to it in the present case. We deem it,
however, convenient to say a few words of
explanation so that the principle enunciated
herein may not lead to any misconstruction of
the law in future cases. There is no question that
the right of the laborers to overtime pay cannot
be waived. But there may be cases in which the
silence of the employee or laborer who lets the
time go by for quite a long period without
claiming or asserting his right to overtime
compensation may favor the inference that he
has not worked any such overtime or that his
extra work has been duly compensated. But this wage was 18. Gualberto seaman 67.50
is not so in the case at bar. The complaining reduced to Legaspi
laborers have declared that long before the P67.50 per 19. Numeriano quartermaster 82.50
filing of this case, they had informed Mr. month as cook; Juanillo
Martinez, a sort of overseer of the petitioner,
5. Emiliano seaman 82.50 20. Moises quartermaster 82.50
that they had been working overtime and
Irabon Nicodemus
claiming the corresponding compensation
……………….
therefor, and there is nothing on record to show 21. Arsenio seaman 82.50
then his
that the claimants, at least the majority of Indiano
wage was
them, had received wages in excess of the 22. Ricardo oiler 82.50
reduced to P60
minimum wage later provided by Republic Act Autencio
and he stayed
No. 602, approved April 6, 1951. On the
for 1 month 23. Mateo seaman 67.50
contrary, in the decision of the trial Judge, it
only; it was Arciaga
appears that 34 out of the 58 claimants received
increased 24. Romulo quartermaster 82.50
salaries less than the minimum wage authorized
again to Magallanes
by said Minimum Wage Law, to wit:
P67.50;
Per month 25. Antonio seaman 67.50
6. Juanito de oiler 82.50 Belbes
1. Ambrosio oiler P82.50 Luna
Tañada 26. Benjamin quartermaster 82.50
7. Benigno oiler 82.50 Aguirre
……………..
Curambao
but after 27. Emilio quartermaster 82.50
passing the 8. Salvador oiler 82.50 Anastasio
examinations Mercadillo
28. Baltazar oiler 82.50
his wages were 9. Nicasio Sta. cook 82.50 Labrada
increased to Lucia
29. Emeterio seaman 67.50
P225 per 10. Damaso seaman 82.50 Magallanes
month; Arciaga
30. Agripino quartermaster 82.50
2. Patricio quartermaster 82.50 11. Leonardo oiler 82.50 Laurente
Santiago Patnugot
…………….. 31. Roberto oiler 82.50
12. Bienvenido oiler 82.50 Francisco
but after
Crisostomo
passing the 32. Elias seaman 82.50
examinations 13. Isidro cook 82.50 Matrocinio
his wages were Malabanan
33. Baltazar seaman 67.50
increased to 14. Saturnino seaman 67.50 Vega
P225 per Tumbokon
34. Jose oiler 82.50
month; 15. Bonifacio quartermaster 82.50 Sanchez
3. Fidelino oiler 82.50 Cortez
Consequently, for lack of the necessary
Villanueva 16. Victorio cook 67.50 supporting evidence for the petitioner, the
…………… Carillo inference referred to above cannot be drawn in
4. Pedro quartermaster 82.50 17. Francisco cook 67.50 this case.
Filamor Atilano V. Granting, without conceding, that any
………………… overtime pay in arrears is due, what is the
then his extent and rule of retro-activity with reference
to overtime pay in arrears as set forth and
established by the precedents and policies of the
Court of Industrial Relations in past decisions
duly affirmed by the Honorable Supreme Court?
VI. Is the grant of a sizeable amount as back
overtime wages by the Court of Industrial
Relations in consonance with the dictates of
public policy and the avowed national and
government policy on economic recovery and
financial stability?
In connection with issue No. 5, petitioner
advances the theory that the computation of the
overtime payment in arrears should be based
from the filing of the petition. In support of this
contention, petitioner cites the case of Gotamco
Lumber Co. vs- Court of Industrial Relations, 85
Phil., 242; 47 Off. Gaz., 3421. This case is not
in point; it merely declares that Commonwealth
Act No. 444 imposes upon the employer the
duty to secure the permit for overtime work,
and the latter may not therefore be heard to
plead his own negligence as exemption or
defense. The employee in rendering extra
services at the request of his employer has a
right to assume that the latter has complied with
the requirements of the law and therefore has
obtained the required permission from the
Department of Labor (47 Off, Gaz., 3421). The
other decisions of the Court of Industrial
Relations cited by petitioner, to wit: Cases 6-V,
7-V and 8-V, Gotamco & Co., Dy Pac & Co., Inc.
and D. C. Chuan; Case 110-V, National Labor
Union vs. Standard Vacuum Oil Co.; Case No.
76-v, Dee Cho Workers, CLO vs. Dee Cho
Lumber Co., and Case No. 70-V, National Labor
Union vs. Benguet Consolidated Mining Co., do
not seem to have reached this Court and to have
been affirmed by Us.
It is of common occurrence that a workingman
has already rendered services in excess of the
statutory period of 8 hours for some time before
he can be led or he can muster enough courage
to confront his employer with a demand for
payment thereof. Fear of possible
unemployment sometimes is a very strong
factor that gags the man from asserting his right
under the law and it may take him months or
years before he could be made to present a
claim against his employer. To allow the
workingman to be compensated only from the
date of the filing of the petition with the court
would be to penalize him for his acquiescence or
silence which We have declared in the case of
the Manila Terminal Co. vs. CIR, supra, to be
beyond the intent of the law. It is not just and
humane that he should be deprived of what is
lawfully his under the law, for the true intendent
of Commonwealth Act No. 444 is to compensate
the worker for services rendered beyond the
statutory period and this should be made to
retroact to the date when such services were
actually performed.
Anent issue No. VI, petitioner questions the
reasonableness of the law providing for the
grant of overtime wages. It is sufficient for Us
to state here that courts cannot go outside of
the field of interpretation so as to inquire into
the motive or motives of Congress in enacting a
particular piece of legislation. This question,
certainly, is not within Our province to
entertain.
It may be alleged, however, that the delay in
asserting the right to back overtime
compensation may cause an unreasonable or
irreparable injury to the employer, because the
accumulation of such back overtime wages may
become so great that their payment might
cause the bankruptcy or the closing of the
business of the employer who might not be in a
position to defray the same. Perhaps this
situation may occur, but We shall not delve on
it this time because petitioner does not claim
that the payment of the back overtime wages it
is ordered to pay to its claimant laborers will
cause the injury it foresees or force it to close
its business, a situation which it speaks of
theoretically and in general.
VII. Should not a Court of Industrial Relations'
resolution, en banc, which is clearly
unsupported in fact and in law, patently
arbitrary and capricious and absolutely devoid
of sustaining reason, be declared illegal?
Especially so, if the trial court's decision which
the resolution en banc reversed, is most
detailed, exhaustive and comprehensive in its
findings as well as most reasonable and legal in
its conclusions? This issue was raised by
petitioner in its supplemental petition and We
have this much to say. The Court of Industrial
Relations has been considered "a court of
justice" (Metropolitan Transportation Service
vs. Paredes,* G.R. No. L-1232, prom. January
12, 1948), although in another case. We said
that it is "more an administrative board than a
part of the integrated judicial system of the
nation" (Ang Tibay vs. Court of Industrial
Relations, 69 Phil., 635). But for procedural
purposes, the Court of Industrial Relations is a
court with well-defined powers vested by the
law creating it and with such other powers as
generally pertain to a court of justice (Sec. 20,
Com. Act No. 103). As such, the general rule
that before a judgment becomes final, the Court
that rendered the same may alter or modify it
so as to conform with the law and the evidence,
is applicable to the Court of Industrial Relations
(Connel Bros. Co.(Phil.) vs. National Labor
Union, G.R. No. L-3631, prom. January 30,
1956). The law also provides that after a judge
of the Court of Industrial Relations, duly
designated by the Presiding Judge therein to
hear a particular case, had rendered a decision,
any agrieved party may request for
reconsideration thereof and the judges of said
Court shall sit together, the concurrence of the
3 of them being necessary for the
pronouncement of a decision, order or award
(See. 1, Com. Act No. 103). It was in virtue of
these rules and upon motions for
reconsideration presented by both parties that
resolution subject of the present petition was
issued, the Court en banc finding it necessary to
modify a part of the decision of February 10,
1955, which is clearly within its power to do.
On the other hand, the issue under
consideration is predicated on a situation which
is not obtaining in the case at bar, for, it
presupposes that the resolutions en banc of the
respondent Court "are clearly unsupported in
fact and in law, patently arbitrary and capricious
and absolutely devoid of any sustaining reason",
which does not seem to be the case as a matter
of fact.
Wherefore, and on the strength of the foregoing
consideration, the resolutions of the Court of
Industrial Relations appealed from are hereby
affirmed, with costs against petitioner. It is so
ordered.
G.R. No. 119205 April 15, 1998
SIME DARBY PILIPINAS, INC. Petitioner,
v. NATIONAL LABOR RELATIONS
COMMISSION (2ND DIVISION) and SIME
DARBY SALARIED EMPLOYEES
ASSOCIATION (ALU-TUCP), Respondents.
BELLOSILLO, J.:
Is the act of management in revising the work
schedule of its employees and discarding their
paid lunch break constitutive of unfair labor
practice?
Sime Darby Pilipinas, Inc., petitioner, is
engaged in the manufacture of automotive tires,
tubes and other rubber products. Sime Darby
Salaried Employees Association (ALU-TUCP),
private respondent, is an association of monthly
salaried employees of petitioner at its Marikina
factory. Prior to the present controversy, all
company factory workers in Marikina including
members of private respondent union worked
from 7:45 a.m. to 3:45 p.m. with a 30-minute
paid "on call" lunch break.
On 14 August 1992 petitioner issued a
memorandum to all factory-based employees
advising all its monthly salaried employees in its
Marikina Tire Plant, except those in the
Warehouse and Quality Assurance Department
working on shifts, a change in work schedule
effective 14 September 1992 thus -
TO: ALL FACTORY-BASED EMPLOYEES
RE: NEW WORK SCHEDULE
Effective Monday, September 14, 1992, the new
work schedule of the factory office will be as
follows:
7:45 A.M. - 4:45 P.M. (Monday to Friday)
7:45 A.M. - 11:45 A.M. (Saturday).
Coffee break time will be ten minutes only
anytime between:
9:30 A.M. - 10:30 A.M. and
2:30 P.M. - 3:30 P.M.
Lunch break will be between:
12:00 NN - 1:00 P.M. (Monday to Friday).
Excluded from the above schedule are the
Warehouse and QA employees who are on
shifting. Their work and break time schedules
will be maintained as it is now. 1
Since private respondent felt affected adversely
by the change in the work schedule and
discontinuance of the 30-minute paid "on call"
lunch break, it filed on behalf of its members a
complaint with the Labor Arbiter for unfair labor
practice, discrimination and evasion of liability
pursuant to the resolution of this Court in Sime
Darby International Tire
Co., Inc. v. NLRC. 2 However, the Labor Arbiter
dismissed the complaint on the ground that the
change in the work schedule and the elimination
of the 30-minute paid lunch break of the factory
workers constituted a valid exercise of
management prerogative and that the new work
schedule, break time and one-hour lunch break
did not have the effect of diminishing the
benefits granted to factory workers as the
working time did not exceed eight (8) hours.
The Labor Arbiter further held that the factory
workers would be unjustly enriched if they
continued to be paid during their lunch break
even if they were no longer "on call" or required
to work during the break. He also ruled that the
decision in the earlier Sime Darby case 3 was
not applicable to the instant case because the
former involved discrimination of certain
employees who were not paid for their 30-
minute lunch break while the rest of the factory
workers were paid; hence, this Court ordered
that the discriminated employees be similarly
paid the additional compensation for their lunch
break.
Private respondent appealed to respondent
National Labor Relations Commission (NLRC)
which sustained the Labor Arbiter and dismissed
the appeal. 4 However, upon motion for
reconsideration by private respondent, the
NLRC, this time with two (2) new commissioners
replacing those who earlier retired, reversed its
earlier decision of 20 April 1994 as well as the
decision of the Labor Arbiter. 5 The NLRC
considered the decision of this Court in the Sime
Darby case of 1990 as the law of the case
wherein petitioner was ordered to pay "the
money value of these covered employees
deprived of lunch and/or working time breaks."
The public respondent declared that the new
work schedule deprived the employees of the
benefits of a time-honored company practice of
providing its employees a 30-minute paid lunch
break resulting in an unjust diminution of
company privileges prohibited by Art. 100 of the
Labor Code, as amended. Hence, this petition
alleging that public respondent committed
grave abuse of discretion amounting to lack or
excess of jurisdiction: (a) in ruling that
petitioner committed unfair labor practice in the
implementation of the change in the work
schedule of its employees from 7:45 a.m. - 3:45
p.m. to 7:45 a.m. - 4:45 p.m. with one-hour
lunch break from 12:00 nn to 1:00 p.m.; (b) in
holding that there was diminution of benefits
when the 30-minute paid lunch break was
eliminated; (c) in failing to consider that in the
earlier Sime Darby case affirming the decision
of the NLRC, petitioner was authorized to
discontinue the practice of having a 30-minute
paid lunch break should it decide to do so; and,
(d) in ignoring petitioner's inherent
management prerogative of determining and
fixing the work schedule of its employees which
is expressly recognized in the collective
bargaining agreement between petitioner and
private respondent.
The Office of the Solicitor General filed in a lieu
of comment a manifestation and motion
recommending that the petitioner be granted,
alleging that the 14 August 1992 memorandum
which contained the new work schedule was not
discriminatory of the union members nor did it
constitute unfair labor practice on the part of
petitioner.
We agree, hence, we sustain petitioner. The
right to fix the work schedules of the employees
rests principally on their employer. In the
instant case petitioner, as the employer, cites
as reason for the adjustment the efficient
conduct of its business operations and its
improved production. 6 It rationalizes that while
the old work schedule included a 30-minute paid
lunch break, the employees could be called
upon to do jobs during that period as they were
"on call." Even if denominated as lunch break,
this period could very well be considered as
working time because the factory employees
were required to work if necessary and were
paid accordingly for working. With the new work
schedule, the employees are now given a one-
hour lunch break without any interruption from
their employer. For a full one-hour undisturbed
lunch break, the employees can freely and
effectively use this hour not only for eating but
also for their rest and comfort which are
conducive to more efficiency and better
performance in their work. Since the employees
are no longer required to work during this one-
hour lunch break, there is no more need for
them to be compensated for this period. We
agree with the Labor Arbiter that the new work
schedule fully complies with the daily work
period of eight (8) hours without violating the
Labor Code. 7 Besides, the new schedule applies
to all employees in the factory similarly situated
whether they are union members or not. 8
Consequently, it was grave abuse of discretion
for public respondent to equate the earlier Sime
Darby case 9 with the facts obtaining in this
case. That ruling in the former case is not
applicable here. The issue in that case involved
the matter of granting lunch breaks to certain
employees while depriving the other employees
of such breaks. This Court affirmed in that case
the NLRC's finding that such act of management
was discriminatory and constituted unfair labor
practice.
The case before us does not pertain to any
controversy involving discrimination of
employees but only the issue of whether the
change of work schedule, which management
deems necessary to increase production,
constitutes unfair labor practice. As shown by
the records, the change effected by
management with regard to working time is
made to apply to all factory employees engaged WHEREFORE, the Petition is GRANTED. The
in the same line of work whether or not they are Resolution of the National Labor Relations
members of private respondent union. Hence, it Commission dated 29 November 1994 is SET
cannot be said that the new scheme adopted by ASIDE and the decision of the Labor Arbiter
management prejudices the right of private dated 26 November 1993 dismissing the
respondent to self-organization. complaint against petitioner for unfair labor
Every business enterprise endeavors to increase practice is AFFIRMED.
its profits. In the process, it may devise means SO ORDERED.
to attain that goal. Even as the law is solicitous
of the welfare of the employees, it must also
protect the right of an employer to exercise
what are clearly management
prerogatives. 10 Thus, management is free to
regulate, according to its own discretion and
judgment, all aspects of employment, including
hiring, work assignments, working methods,
time, place and manner of work, processes to
be followed, supervision of workers, working
regulations, transfer of employees, work
supervision, lay off of workers and discipline,
dismissal and recall of workers. 11 Further,
management retains the prerogative, whenever
exigencies of the service so require, to change
the working hours of its employees. So long as
such prerogative is exercised in good faith for
the advancement of the employer's interest and
not for the purpose of defeating or
circumventing the rights of the employees
under special laws or under valid agreements,
this Court will uphold such exercise. 12
While the Constitution is committed to the policy
of social justice and the protection of the
working class, it should not be supposed that
every dispute will be automatically decided in
favor of labor. Management also has rights
which, as such, are entitled to respect and
enforcement in the interest of simple fair play.
Although this Court has inclined more often than
not toward the worker and has upheld his cause
in his conflicts with the employer, such
favoritism has not blinded the Court to the rule
that justice is in every case for the deserving, to
be dispensed in the light of the established facts
and the applicable law and doctrine. 13
G.R. No. L-30452 September 30, 1982
MERCURY DRUG CO., INC., petitioner,
vs.
NARDO DAYAO, ET AL., respondents,
Caparas & Ilagan for petitioner.
Gerardo P. Cabo Chan and Elias Banzali for
respondents.
GUTIERREZ, JR., J.:
This is a petition for review on certiorari of the
decision of the Court of Industrial Relations
dated March 30, 1968 in Case No. 1926-V and
the Resolution of the Court en banc dated July
6, 1968 denying two separate motions for
reconsideration filed by petitioners and
respondents.
The factual background of Case No. 1926-V is
summarized by the respondent Court of
Industrial Relations as follows:
This is a verified petition dated March 17, 1964
which was subsequently amended on July 31,
1964 filed by Nardo Dayao and 70 others
against Mercury Drug Co., Inc., and/or Mariano
Que, President & General Manager, and Mercury
Drug Co., Inc., Employees Association praying,
with respect to respondent corporation and its
president and general manager: 1) payment of
their unpaid back wages for work done on
Sundays and legal holidays plus 25c/c additional
compensation from date of their employment up
to June 30, 1962; 2) payment of extra
compensation on work done at night; 3)
reinstatement of Januario Referente and Oscar
Echalar to their former positions with back
salaries; and, as against the respondent union,
for its disestablishment and the refund of all
monies it had collected from petitioners.
In separate motions, respondent management
and respondent union move to dismiss, the first
on the ground that:
I. The petition states no cause of action.
II. This Court has no jurisdiction over the
subject of the claims of petitioners Januario
Referente and Oscar Echalar.
III. There is another action pending between the
same parties, namely, Mercury Drug Co., Inc.,
and/or Mariano Que and Nardo Dayao.
while on the other hand, the second alleges that
this Court has no jurisdiction over the acts
complained of against the respondent union.
For reasons stated in the Order dated March 24,
1965, two Court resolved the motions to
dismiss, as follows:
1. Ground No. 1 of management's motion to
dismiss was denied for lack of merit.
2. Its second ground was found meritorious and,
accordingly Januario Referente and Oscar
Echalar were dropped as party petitioners in this
case.
3. The third ground was denied, holding that
there still exists the employer- employee
relationship between Nardo Dayao and the
management.
4. With respect to the fourth ground, the Court
held that on the basis of section 7-A of C.A. No.
444, as amended by R.A. No. 1993, 'it can be
safely said that,
counting backward the three (3) year
prescriptive period from the date of the filing of
the instant petition - March 20, 1964 - all-of
petitioners' claims have not yet prescribed.'
5. In so far as respondent union's motion is
concerned, the Court held that 'petitioners'
cause of action against the respondent
Association should be dismissed without
prejudice to the refiling of the same as an unfair
labor practice case.'
Only the respondent management moved to
reconsider the Order of March 24, 1965 but the
same was denied by the Court en banc in a
resolution dated August 26, 1965. Respondent
submitted an answer to the amended petition
which was subsequently amended on January 6,
1966, containing some admissions and some
denials of the material averments of the
amended petition. By way of affirmative and
special defenses,, respondents alleged that
petitioners have no cause of action against
Mariano Que because their employer
respondent Mercury Drug Company, Inc., an
existing corporation which has a separate and
distinct personality from its incorporators
stockholders and/or officer, that the company
being a service enterprise is excluded from the
coverage of the Eight Hour Labor Law, as
amended; that no court has the power to set
wages, rates of pay, hours of employment, or
other conditions of employment to the extent of
disregarding an agreement thereon between the
respondent company and the petitioners, and of
fixing night differential wages; that the
petitioners were fully paid for services rendered
under the terms and conditions of the individual
contracts of employment; that the petition
having been verified by only three of the
petitioners without showing that the others
authorized the inclusion of their names as
petitioners does not confer jurisdiction to this
Court; that there is no employer-employee
relationship between management and
petitioner Nardo Dayao and that his claim has
been released and/or barred by another action
and that petitioners' claims accuring before
March 20, 1961 have prescribed." (Annex "P",
pp. 110-112, rollo).
After hearing on the merits, the respondent
court rendered its decision. The dispositive
portion of the March 30, 1968 decision reads:
IN VIEW OF THE FOREGOING, the Court hereby
resolves that:
1. The claim of the petitioners for payment of
back wages correspoding to the first four hours
work rendered on every other Sunday and first
four hours on legal holidays should be denied for
lack of merit.
2. Respondent Mercury Drug Company, Inc.. is
hereby ordered to pay the sixty- nine (69)
petitioners:
(a) An additional sum equivalent to 25% of their
respective basic or regular salaries for services
rendered on Sundays and legal holidays during
the period from March 20. 1961 up to June 30,
1962; and
(b) Another additional sum or premium
equivalent to 25% of their respective basic or
regular salaries for nighttime services rendered
from March 20, 1961 up to June 30, 1962.
3. Petitioners' petition to convert them to
monthly employees should be, as it is hereby,
denied for lack of merit.
4. Respondent Mariano Que, being an officer
and acted only as an agent in behalf of the
respondent corporation, should be absolved
from the money claims of herein petitioners
whose employer, according to the pleadings and
evidence, is the Mercury Drug Company,, Inc.
To expedite the computation of the money
award, the Chief Court Examiner or his
authorized representative is hereby directed to
proceed to the office of the respondent
corporation at Bambang Street, Sta. Cruz,
Manila, the latter to make available to said
employee its records, like time records, payrolls
and other pertinent papers, and compute the
money claims awarded in this decision and,
upon the completion thereof, to submit his
report as soon as possible for further disposition
of the Court.
Not satisfied with the decision, the respondents
filed a motion for its reconsideration. The
motion for reconsideration, was however,
denied by the Court en banc in its Resolution
dated July 6, 1968.
Petitioner Mercury Drug Company, Inc.,
assigned the following errors in this petition:
I or regular salaries.
RESPONDENT CIR ERRED IN DECLARING THE
CONTRACTS OF EMPLOYMENT, EXHIBITS "A"
AND "B", NULL AND VOID AS BEING CONTRARY
TO PUBLIC POLICY AND IN SUSTAINING,
ACCORDINGLY, PRIVATE RESPONDENTS'
CLAIMS FOR 25% SUNDAY AND LEGAL
HOLIDAY PREMIUMS BECAUSE SUCH
DECLARATION AND AWARD ARE NOT
SUPPORTED BY SUBSTANTIAL EVIDENCE, THUS
INFRINGING UPON THE CARDINAL RIGHTS OF
THE PETITIONER; AND ALSO BECAUSE THE
VALIDITY OF SAID t CONTRACTS OF
EMPLOYMENT HAS NOT BEEN RAISED.
II
RESPONDENT CIR ERRED IN SUSTAINING
PRIVATE RESPONDENTS' CLAIMS FOR
NIGHTTIME WORK PREMIUMS NOT ONLY
BECAUSE OF THE DECLARED POLICY ON
COLLECTIVE BARGAINING FREEDOM EX.
PRESSED IN REPUBLIC ACT 875 AND THE
EXPRESS PROHIBITION IN SECTION 7 OF SAID
STATUTE, BUT ALSO BECAUSE OF THE WAIVER
OF SAID CLAIMS AND THE TOTAL ABSENCE OF
EVIDENCE THEREON.
III
RESPONDENT CIR ERRED IN MAKING AWARDS
IN FAVOR OF THE PRIVATE RESPONDENTS WHO
NEITHER GAVE EVIDENCE NOR EVEN
APPEARED TO SHOW THEIR INTEREST.
Three issues are discussed by the petitioner in
its first assignment of error. The first issue
refers to its allegation that the respondent Court
erred in declaring the contracts of employment
null and void and contrary to law. This allegation
is premised upon the following finding of the
respondent court:
But the Court finds merit in the claim for the
payment of additional compensation for work
done on Sundays and holidays. While an
employer may compel his employees to perform
service on such days, the law nevertheless
imposes upon him the obligation to pay his
employees at least 25% additional of their basic
No person, firm or corporation, business
establishment or place of center of labor shall
compel an employee or laborer to work during
Sundays and legal holidays unless he is paid an
additional sum of at least twenty-five per
centum of his regular remuneration:
PROVIDED, HOWEVER, That this prohibition
shall not apply to public utilities performing
some public service such as supplying gas,
electricity, power, water, or providing means of
transportation or communication. (Section 4, C.
A. No. 444) (Emphasis supplied)
Although a service enterprise, respondent
company's employees are within the coverage
of C. A. No. 444, as amended known as the
Eight Hour Labor Law, for they do not fall within
the category or class of employees or laborers
excluded from its provisions. (Section 2, Ibid.)
The Court is not impressed by the argument
that under the contracts of employment the
petitioners are not entitled to such claim for the
reason that the same are contrary to law.
Payment of extra or additional pay for services
rendered during Sundays and legal holidays is
mandated by law. Even assuming that the
petitioners had agreed to work on Sundays and
legal holidays without any further consideration
than their monthly salaries, they are not barred
nevertheless from claiming what is due them,
because such agreement is contrary to public
policy and is declared nun and void by law.
Any agreement or contract between employer
and the laborer or employee contrary to the
provisions of this Act shall be null and void ab
initio.
Under the cited statutory provision, the
petitioners are justified to receive additional
amount equivalent to 25% of their respective
basic or regular salaries for work done on
Sundays and legal holidays for the period from
March 20, 1961 to June 30, 1962. (Decision, pp.
119-120, rollo)
From a perusal of the foregoing statements of
the respondent court, it can be seen readily that
the petitioner-company based its arguments in
its first assignment of error on the wrong
premise. The contracts of employment signed
by the private respondents are on a standard
form, an example of which is that of private
respondent Nardo Dayao quoted hereunder:
Mercury Drug Co., Inc. 1580 Bambang, Manila
October 30, 1959
Mr. Nardo Dayao
1015 Sta. Catalina
Rizal Ave., Exten.
Dear Mr. Dayao:
You are hereby appointed as Checker, in the
Checking Department of MERCURY DRUG CO.,
INC., effective July 1, 1959 and you shall
receive an annual compensation the amount of
Two Thousand four hundred pesos only
(P2,400.00), that includes the additional
compensation for work on Sundays and legal
holidays.
Your firm being a Service Enterprise, you will be
required to perform work every day in a year as
follows:
8 Hours work on regular days and-all special
Holidays that may be declared but with the 25%
additional compensation;
4 Hours work on every other Sundays of the
month;
For any work performed in excess of the hours
as above mentioned, you shall be paid 25 %
additional compensation per hour.
This appointment may be terminated without
notice for cause and without cause upon thirty
days written notice.
This supersedes your appointment of July 1,
1959.
Very truly yours,
MERCURY DRUG CO., INC.
(Sgd.) MARIANO QUE General Manager
ACCEPTED WITH FULL CONFORMITY:
(Sgd.) NARDO DAYAO
(EXH. "A" and "l ")
(Decision, pp. 114-115, rollo)
These contracts were not declared by the
respondent court null and void in their entirety.
The respondent court, on the basis of the
conflicting evidence presented by the parties, in
effect: 1) rejected the theory of the petitioner
company that the 25% additional compensation
claimed by the private respondents for the four-
hour work they rendered during Sundays and
legal holidays provided in their contracts of
employment were covered by the private
respondents' respective monthly salaries; 2)
gave credence to private respondents', (Nardo
Dayao, Ernesto Talampas and Josias Federico)
testimonies that the 25% additional
compensation was not included in the private
respondents' respective monthly salaries and 3)
ruled that any agreement in a contract of
employment which would exclude the 25%
additional compensation for work done during
Sundays and holidays is null and void as
mandated by law.
On the second issue, the petitioner-company
reiterated its stand that under the,- respective
contracts of employment of the private
respondents, the subject 25 % additional
compensation had already been included in the
latter's respective monthly salaries. This
contention is based on the testimony of its lone
witness, Mr. Jacinto Concepcion and pertinent
exhibits. Thus:
Exhibit A shows that for the period of October
30, 1960, the annual compensation of private
respondent Nardo Dayao, including the
additional compensation for the work he renders
during the first four (4) hours on every other
Sunday and on the eight (8) Legal Holidays at
the time was P2,400.00 or P200.00 per month.
These amounts did not represent basic salary
only, but they represented the basic daily wage
of Nardo Dayao considered to be in the amount
of P7.36 x 305 ordinary working days at the
time or in the total amount of P2,144.80. So
plus the amount of P156.40 which is the
equivalent of the Sunday and Legal Holiday rate
at P9.20 basic rate of P7.36 plus 25% thereof or
P1.84) x 17, the latter figure representing 13
Sundays and 4 Legal Holidays of 8 hours each.
...
xxx xxx xxx
That the required minimum 25% Sunday and
Legal Holiday additional compensation was paid
to and received by the employees for the work
they rendered on every other Sunday and on
the eight Legal Holidays for the period October,
1959 to June 30, 1962 is further corroborated
by Exhibits 5, 6, 8, 9 and 9-A and the testimony
of Mr. Jacinto Concepcion thereon. (Brief for the
Petitioner, pp. 24, 27).
The aforesaid computations were not given
credence by the respondent court. In fact the
same computations were not even mentioned in
the court's decision which shows that the court
found such computations incredible. The
computations, supposedly patterned after the
WAS Interpretative Bulletin No. 2 of the
Department Labor demonstrated in Exhibits "6",
"7", "8", "9", and "9-A", miserably failed to show
the exact and correct annual salary as stated in
the respective contracts of employment of the
respondent employees. The figures arrived at in
each case did not tally with the annual salaries
on to the employees' contracts of employment,
the difference varying from P1.20 to as much as
P14.40 always against the interest of the
employees. The petitioner's defense consists of
mathematical computations made after the
filing of the case in order to explain a clear
attempt to make its employees work without the
extra compensation provided by law on Sundays
and legal holidays.
In not giving weight to the evidence of the
petitioner company, the respondent court
sustained the private respondents' evidence to
the effect that their 25% additional
compensation for work done on Sundays and
Legal Holidays were not included in their
respective monthly salaries. The private
respondents presented evidence through the
testimonies of Nardo Dayao, Ernesto Talampas,
and Josias Federico who are themselves among
the employees who filed the case for unfair labor
practice in the respondent court and are private
respondents herein. The petitioner- company's
contention that the respondent court's
conclusion on the issue of the 25% additional
compensation for work done on Sundays and
legal holidays during the first four hours that the
private respondents had to work under their
respective contracts of employment was not
supported by substantial evidence is, therefore,
unfounded. Much less do We find any grave
abuse of discretion on the part of the
respondent court in its interpretation of the
employment contract's provision on salaries. In
view of the controlling doctrine that a grave
abuse of discretion must be shown in order to
warrant our disturbing the findings of the
respondent court, the reversal of the court's
endings on this matter is unwarranted.
(Sanchez vs. Court of Industrial Relations, 27
SCRA 490).
The last issue raised in the first assignment of
error refers to a procedural matter. The
petitioner-company contends that ,-the
question as to whether or not the contracts of
employment were null and void was not put in
issue, hence, the respondent court pursuant to
the Rules of Court should have refrained from
ruling that such contracts of employment were
null and void. In this connection We restate our
finding that the respondent court did not declare
the contracts of employment null and void in
their entirety. Only the objectionable features
violative of law were nullified. But even granting
that the Court of Industrial Relations declared
the contracts of employment wholly void, it
could do so notwithstanding the procedural
objection. In Sanchez u. Court of Industrial
Relations, supra, this Court speaking through
then Justice, now Chief Justice Enrique M.
Fernando, stated:
xxx xxx xxx
Moreover, petitioners appear to be oblivious of
the statutory mandate that respondent Court in
the hearing, investigation and determination of
any question or controversy and in the exercise
of any of its duties or power is to act 'according
to justice and equity and substantial merits of
the case, without regard to technicalities or
legal forms and shall not be bound by any
technical rules of legal evidence' informing its
mind 'in such manner as it may deem just and
equitable.' Again, this Court has invariably
accorded the most hospitable scope to the
breadth and amplitude with which such
provision is couched. So it has been from the
earliest case decided in 1939 to a 1967 decision.
Two issues are raised in the second assignment
of error by the petitioner-company. The first
hinges on the jurisdiction of the respondent
court to award additional compensation for
nighttime work. Petitioner wants Us to re-
examine Our rulings on the question of
nighttime work. It contends that the respondent
court has no jurisdiction to award additional
compensation for nighttime work because of the
declared policy on freedom of collective
bargaining expressed in Republic Act 875 and
the express prohibition in Section 7 of the said
statute. A re- examination of the decisions on
nighttime pay differential was the focus of
attention in Rheem of the Philippines, Inc. et al.,
v. Ferrer, et al (19 SCRA 130). The earliest
cases cited by the petitioner-company, Naric v.
Naric Workers Union L-12075, - May 29, 1959
and Philippine Engineers' Syndicate u. Bautista,
L-16440, February 29, 196.4, were discussed
lengthily. Thus -
xxx xxx xxx
2. On the claim for night differentials, no
extended discussion is necessary. To be read as
controlling here is Philippine Engineers'
Syndicate, Inc. vs. Hon. Jose S. Bautista, et al.,
L-16440, February 29, 1964, where this Court,
speaking thru Mr. Chief Justice Cesar Bengzon,
declared —
Only one issue is raised: whether or not upon
the enactment of Republic Act 875, the CIR lost
its jurisdiction over claims for additional
compensation for regular night work. Petitioner
says that this Act reduced the jurisdiction of
respondent court and limited it to specific cases
which this Court has defined as: ... (1) when the
labor dispute affects an industry which is
indispensable to the national interest and is so
certified by the President to the industrial court
(Sec. 10, Republic Act 875); (2) when the
controversy refers to minimum wage under the
Minimum Wage Law (Republic Act 602); (3)
when it involves hours of employment under the
Eight-Hour Labor Law (Commonwealth Act 444)
and (4) when it involves an unfair labor practice
[Sec. 5(a), Republic Act 8751', [Paflu, et al. vs.
Tan, et al., 52 Off. Gaz, No. 13, 5836].
Petitioner insists that respondents' case falls in
none of these categories because as held in two
previous cases, night work is not overtime but
regular work; and that respondent court's
authority to try the case cannot be implied from
its general jurisdiction and broad powers' under
Commonwealth Act 103 because Republic Act
875 precisely curbed such powers limiting them
to certain specific litigations, beyond which it is
not permitted to act.
We believe petitioner to be in error. Its position
collides with our ruling in the Naric case
[National Rice & Corn Corp. (NARIC) vs. NARIC
Workers' Union, et al., G.R. No. L-12075, May
29, 1959] where we held;
While it is true that this Court made the above
comment in the aforementioned case, it does
not intend to convey the Idea that work done at
night cannot also be an overtime work. The
comment only served to emphasize that the
demand which the Shell Company made upon
its laborers is not merely overtime work but
night work and so there was need to
differentiate night work from daytime work. In
fact, the company contended that there was no
law that required the payment of additional
compensation for night work unlike an overtime
work which is covered by Commonwealth Act
No. 444 (Eight Hour Labor Law). And this Court
in that case said that while there was no law
actually requiring payment of additional
compensation for night work, the industrial
court has the power to determine the wages
that night workers should receive under
Commonwealth Act No. 103, and so it justified
the additional compensation in the Shell case for
'hygienic, medical, moral, cultural and
sociological reasons.
xxx xxx xxx
True, in Paflu, et al. vs. Tan, et al., supra, and
in a series of cases thereafter, We held that the
broad powers conferred by Commonwealth Act
103 on the CIR may have been curtailed by
Republic Act 875 which limited them to the four
categories therein expressed in line with the
public policy of allowing settlement of industrial
disputes via the collective bargaining process;
but We find no cogent reason for concluding that
a suit of this nature for extra compensation for
night work falls outside the domain of the
industrial court. Withal, the record does not
show that the employer-employee relation
between the 64 respondents and the petitioner
had ceased.
After the passage of Republic Act 875, this Court
has not only upheld the industrial court's
assumption of jurisdiction over cases for salary
differentials and overtime pay [Chua Workers
Union (NLU) vs. City Automotive Co., et al., G.R.
No. L- 11655, April 29, 1959; Prisco vs. CIR, et
al., G.R. No. L-13806, May 23, 1960] or for
payment of additional compensation for work
rendered on Sundays and holidays and for night
work [Nassco vs. Almin, et al., G.R. No. L9055,
November 28, 1958; Detective & Protective
Bureau, Inc. vs. Felipe Guevara, et al., G.R. No.
L-8738, May 31, 1957] but has also supported
such court's ruling that work performed at night
should be paid more than work done at daytime,
and that if that work is done beyond the
worker's regular hours of duty, he should also
be paid additional compensation for overtime
work. [Naric vs. Naric Workers' Union. et al., G.
R No. L-12075, May 29, 1959, citing Shell Co.
vs. National Labor Union, 81 Phil. 315]. Besides,
to hold that this case for extra compensation
now falls beyond the powers of the industrial
court to decide, would amount to a further
curtailment of the jurisdiction of said court to an
extent which may defeat the purpose of the
Magna Carta to the prejudice of labor.' [Luis
Recato Dy, et al v-9. CIR, G.R. No. L-17788,
May 25,1962]"
The petitioner-company's arguments on the
respondent court's alleged lack of jurisdiction
over additional compensation for work done at
night by the respondents is without merit.
The other issue raised in the second assignment
of error is premised on the petitioner-company's
contention that the respondent court's ruling on
the additional compensation for nighttime work
is not supported by substantial evidence.
This contention is untenable. Pertinent portions
of the respondent court's decision read:
xxx xxx xxx
There is no serious disagreement between the
petitioners and respondent management on the
facts recited above. The variance in the
evidence is only with respect to the money
claims. Witnesses for petitioners declared they
worked on regular days and on every other
Sunday and also during all holidays; that for
services rendered on Sundays and holidays they
were not paid for the first four (4) hours and
what they only received was the overtime
compensation corresponding to the number of
hours after or in excess of the first four hours;
and that such payment is being indicated in the
overtime pay for work done in excess of eight
hours on regular working days. It is also claimed
that their nighttime services could well be seen
on their respective daily time records.
.. (Emphasis supplied) (p.116, rollo)
The respondent court's ruling on additional
compensation for work done at night is,
therefore, not without evidence. Moreover, the
petitioner-company did not deny that the
private respondents rendered nighttime work.
In fact, no additional evidence was necessary to
prove that the private respondents were entitled
to additional compensation for whether or not
they were entitled to the same is a question of
law which the respondent court answered
correctly. The "waiver rule" is not applicable in
the case at bar. Additional compensation for
nighttime work is founded on public policy,
hence the same cannot be waived. (Article 6,
Civil Code). On this matter, We believe that the
respondent court acted according to justice and
equity and the substantial merits of the case,
without regard to technicalities or legal forms
and should be sustained.
The third assignment of error is likewise without
merit. The fact that only three of the private
respondents testified in court does not
adversely affect the interests of the other
respondents in the case. The ruling in Dimayuga
V. Court of Industrial Relations (G.R. No. L-
0213, May 27, 1957) has been abandoned in
later rulings of this Court. In Philippine Land Air-
Sea Labor Union (PLASLU) vs. Sy Indong
Company Rice And Corn Mill (11 SCRA 277) We
had occasion to re-examine the ruling
in Dimayuga We stated:
The latter reversed the decision of the trial
Judge as regards the reinstatement with
backwages of ... upon the theory that this is not
a class suit; that, consequently, it is necessary
and imperative that they should personally
testify and prove the charges in the complaint',
and that, having failed to do so, the decision of
the trial Judge in their favor is untenable under
the rule laid down in Dimayuga vs. Court of
Industrial Relations, G.R. No. L-0213 (May
27,1957).
We do not share the view taken in the resolution
appealed from. As the trial Judge correctly said,
in Ms dissent from said resolution,:
xxx xxx xxx
In the case of Sanchez v. Court of Industrial
Relations, supra, this Court stated:
To the reproach against the challenged order in
the brief of petitioners in view of only two of the
seven claimants testifying, a statement by
this Court in Ormoc Sugar Co., Inc. vs. OSCO
Workers Fraternity Labor Union would suffice by
way of refutation. Thus: "This Court fully agrees
with the respondent that quality and not
quantity of witnesses should be the primordial
consideration in the appraisal of evidence.'
Barely eight days later, in another decision, the
above statement was given concrete
expression. Thus: 'The bases of the awards
were not only the respective affidavits of the
claimants but the testimonies of 24 witnesses
(because 6 were not given credence by the
court below) who Identified the said 239
claimants. The contention of petitions on this disadvantageous positions and who sign
point is therefore unfounded Moveover waivers or provisions contrary to law and public
in Philippine Land-Air-Sea Labor Union policy.
(PLASLU) v. Sy Indong company Rice & Corn WHEREFORE, the petition is hereby dismissed.
Mill, this Court, through the present Chief The decision and resolution appealed from are
Justice rejected as untenable the theory of the affirmed with costs against the petitioner.
Court of Industrial Relations concerning the SO ORDERED.
imperative needs of all the claimants to testify
personality and prove their charges in the
complaint. As tersely put: 'We do not share the
view taken in the resolution appealed from.
The petitioner's contention that its employees
fully understood what they signed when they
entered into the contracts of employment and
that they should be bound by their voluntary
commitments is anachronistic in this time and
age.
The Mercury Drug Co., Inc., maintains a chain
of drugstores that are open every day of the
week and, for some stores, up to very late at
night because of the nature of the
pharmaceutical retail business. The respondents
knew that they had to work Sundays and
holidays and at night, not as exceptions to the
rule but as part of the regular course of
employment. Presented with contracts setting
their compensation on an annual basis with an
express waiver of extra compensation for work
on Sundays and holidays, the workers did not
have much choice. The private respondents
were at a disadvantage insofar as the
contractual relationship was concerned.
Workers in our country do not have the luxury
or freedom of declining job openings or filing
resignations even when some terms and
conditions of employment are not only onerous
and inequitous but illegal. It is precisely because
of this situation that the framers of the
Constitution embodied the provisions on social
justice (Section 6, Article 11) and protection to
labor (Section 9, Article I I) in the Declaration
of Principles And State Policies.
It is pursuant to these constitutional mandates
that the courts are ever vigilant to protect the
rights of workers who are placed in contractually
G.R. No. 123520 June 26, 1998
NATIONAL SEMICONDUCTOR (HK)
DISTRIBUTION, LTD., petitioner,
vs.
NATIONAL LABOR RELATIONS
COMMISSION (4TH DIVISION) and EDGAR
PHILIP C. SANTOS, respondents.
BELLOSILLO, J.:
The main issues to be resolved in his petition
for certiorari are: First, who has the burden of
providing a claim for night shift differential pay,
the worker who claims not to have been paid
night shift differentials, or the employer in
custody of pertinent documents which would
prove the fact of payment of the same? Second,
were the requirements of due process
substantially complied with in dismissing the
worker?
Petitioner National Semiconductor (HK)
Distribution, Ltd. (NSC for brevity), a foreign
corporation licensed to do business in the
Philippines, manufactures and assembles
electronic parts for export with principal office
at the Mactan Export Processing Zone, Mactan,
Lapu-Lapu City. Private respondent Edgar Philip
C. Santos was employed by NSC as a technician
in its Special Products Group with a monthly
salary of P5,501.00 assigned to the graveyard
shift starting at ten o' clock in the evening until
six o' clock in the morning.
On 8 January 1993 Santos did not report for
work on his shift. He resumed his duties as night
shift Technician Support only on 9 January
1993. However, at the end of his shift the
following morning, he made two (2) entries in
his daily time record (DTR) to make it appear
that he worked on both the 8th and 9th of
January 1993.
His immediate supervisor, Mr. Joel Limsiaco,
unknown to private respondent Santos,
received the report that there was no technician
in the graveyard shift of 8 January 1993. Thus,
Limsiaco checked the DTRs and found out that
Santos indeed did not report for work on 8
January. But when he checked Santos' DTR
again in the morning of 9 January 1993 he found
the entry made by Santos for the day before.
Informal investigations were conducted by
management. Santos was required in a
memorandum to explain in writing within 48
hours from notice why no disciplinary action
should be taken against him for dishonesty,
falsifying daily time record (DTR) and violation
of company rules and regulations. 1 On 11
January 1993 Santos submitted his written
explanation alleging that he was ill on the
day he was absent. As regards the entry on
8 January, he alleged that it was merely
due to oversight or carelessness on his
part. 2
Finding Santos' explanation
unsatisfactory, NSC dismissed him on 14
January 1993 on the ground of falsification
of his DTR, which act was inimical to the
company and constituted dishonesty and
serious misconduct. 3
Thus, on 20 January 1993, Santos filed a
complaint for illegal dismissal and non-
payment of back wages, premium pay for
holidays and rest days, night shift
differential pay, allowances, separation
pay, moral damages and attorney's fees.
Labor Arbiter Dominador A. Almirante
found that Santos was dismissed on legal
grounds although he was not afforded due
process, hence, NSC was ordered to
indemnify him P1,000.00. The Labor
Arbiter likewise ordered the payment of
P19,801.47 representing Santos' unpaid
night shift differentials. 4
NSC appealed to the National Labor
Relations Commission (NLRC). In its
Decision of 29 September 1995 the NLRC
affirmed the Labor Arbiter holding that his
conclusions were sufficiently supported by
the evidence and therefore must be
respected by the appellate tribunal
because the hearing officer was in a unique
position to observe the demeanor of
witnesses and to judge their credibility. 5
NSC imputes grave abuse of discretion to
the NLRC in affirming the Labor Arbiter's
award of night shift differentials and
P1,000.00 indemnity for alleged violation
of due process. It contends that the
question of non-payment of night shift
differentials was never raised as an issue
nor pursued and proved by Santos in the
proceeding before the Labor Arbiter; that
Santos was already paid his night shift
differentials, and any further payment to
him would amount to unjust enrichment;
and, that the P1,000.00 indemnity is totally
unjustified as he was afforded ample
opportunity to be heard.
We now resolve. A perusal of Santos'
position paper filed before the Labor
Arbiter reveals that the question of non-
payment of night shift differentials was
specifically raised as an issue in the
proceedings below which was never
abandoned by Santos as erroneously
claimed by NSC thus —
ISSUES
1. Did respondent National Semiconductor
(HK) Distribution Ltd. illegally dismiss
complainant Edgar Philip Santos?
2. Is complainant Edgar Philip Santos
entitled to recover unpaid salary, holiday
pay, night shift differential, allowances,
separation pay, retirement benefits and
moral damages? 6
And, in his prayer, Santos sought to be
afforded the reliefs prayed for in his
complaint. 7
The fact that Santos neglected to
substantiate his claim for night shift
differentials is not prejudicial to his cause.
After all, the burden of proving payment
rests on petitioner NSC. Santos' allegation
of non-payment of this benefit, to which he
is by law entitled, is a negative allegation
which need not be supported by evidence
unless it is an essential part of his cause of
action. It must be noted that his main
cause of action is his illegal dismissal, and
the claim for night shift differential is but
an incident of the protest against such
dismissal. Thus, the burden of proving that
payment of such benefit has been made
rests upon the party who will suffer if no
evidence at all is presented by either
party. 8 Moreover, in Jimerez v. National
Labor Relations Commission, 9 we declared
— percent (10%) of his regular wage for each
As a general rule, one who pleads payment
has the burden of proving it. Even where
the plaintiff must allege non-payment, the
general rule is that the burden rests on the
defendant to prove payment, rather than
on the plaintiff to prove non-payment. The
debtor has the burden of showing with
legal certainty that the obligation has been
discharged by payment.
For sure, private respondent cannot
adequately prove the fact of non-payment
of night shift differentials since the
pertinent employee files, payrolls, records,
remittances and other similar documents
— which will show that private respondent
rendered night shift work; the time he
rendered services; and, the amounts owed
as night shift differentials — are not in his
possession but in the custody and absolute
control of petitioner.
Private respondent has been in petitioner's
employ for five (5) years — starting 13
January 1988 when he was hired to 14
January 1993 when his services were
terminated — and petitioner never denied
that private respondent rendered night
shift work. In fact, it even presented some
documents purporting to prove that
private respondent was assigned to work
on the night shift.
By choosing not to fully and completely
disclose information to prove that it had
paid all the night shift differentials due to
private respondent, petitioner failed to
discharge the burden of proof.
Consequently, no grave abuse of discretion
can be ascribed to the NLRC for sustaining
the Labor Arbiter when it ruled thus —
It is not disputed that complainant was
regularly assigned to a night shift (10:00
P.M. to 7:00 A.M.). Under Section 2, Rule
II, Book Three of the Implementing Rules
of the Labor Code, complainant is entitled
to an additional benefit of not less ten
hour of work performed. The record is
bereft of evidence that respondent has
paid complainant this benefit. The best
evidence for respondent corporation would
have been the payrolls, vouchers, daily
time records and the like which under
Sections 6, 7, 8, 11 and 12, Rule X, Book
III of the Implementing Rules it is obliged
to keep. Its failure gives rise to the
presumption that either it does not have
them or if it does, their presentation is
prejudicial to its cause.
We rule therefore that complainant should
be awarded a night shift differential but
limited to there (3) years considering the
prescriptive period of money claims. 10
On the issue of due process, we agree with
petitioner that Santos was accorded full
opportunity to be heard before he was
dismissed.
The essence of due process is simply an
opportunity to be heard, or as applied to
administrative proceedings, an
opportunity to explain one's side. 11 In the
instant case, petitioner furnished private
respondent notice as to the particular acts
which constituted the ground for his
dismissal. By requiring him to submit a
written explanation within 48 hours from
receipt of the notice, the company gave
him the opportunity to be heard in his
defense. Private respondent availed of this
chance by submitting a written
explanation. Furthermore, investigations
on the incident were actually conducted on
9 January 1993 and 11 January 1993. Mr.
Reynaldo Gandionco, petitioner's witness,
testified:
Q: I reform my question. Was there an
investigation conducted on the
complainant regarding the alleged
falsification of DTR?
A: Yes, ma'am, there was.
Q: Who was present during the alleged
investigation? I am referring to the first
investigation?
A: The first investigation we were many.
We were Daryll Go, Joel Limsiaco, Edgar
Philip Santos and me.
Q: When was the first investigation
conducted?
A: On the night of January 9, 1993.
xxx xxx xxx
Q: During the second investigation, who
were present?
A: We were: Daryll Go, Edgar Philip Santos
and me.
Q: And when was the second investigation
conducted?
A: It was on January 11, 1993 in the
afternoon. 12
Finally, private respondent was notified on
14 January 1993 of the management's
decision to terminate his services.
Thus, it is clear the minimum requirements
of due process have been fulfilled by
petitioner.
That the investigations conducted by
petitioner may not be considered formal or
recorded hearings or investigations is
immaterial. A formal or trial type hearing
is not all times and in all instances
essential to due process, the requirements
of which are satisfied where the parties are
afforded fair and reasonable opportunity to
explain their side of the controversy. 13 It
is deemed sufficient for the employer to
follow the natural sequence of notice,
hearing and judgment. 14
WHEREFORE, petition is DISMISSED. The
NLRC Decision of 29 September 1995 is
AFFIRMED subject to the modification that
the award of P1,000.00 as indemnity is
DELETED in accordance with the foregoing
discussion.
SO ORDERED.