LABOR STANDARDS
IB. MINIMUM WAGE RATES
It refers to the MINIMUM REQUIREMENTS 
prescribed by existing laws and rules and regulations
 relating to wages, hours of work, cost of living
allowance and other monetary and welfare benefits
Update: Service charges – entitled now to 100% of the
IA. WAGES
1. Mayon Hotel & Restaurant v. Adana:
a. The employer simply cannot deduct the value
from the employee's wages without satisfying the
following: [CVF]
(a) proof that such facilities are customarily furnished
by the trade;
(b) the provision of deductible facilities is voluntarily
accepted in writing by the employee; and
(c) the facilities are charged at fair and reasonable
value
Hence, cost of meals and snacks cannot be availed
automatically (not deducted in this case)
Facility Supplement
Purpose: Part of the basic Purpose: Extra
wage remuneration
Note: This is the one that
can be deducted upon
satisfying the elements.
*It should be based on PURPOSE, not the KIND of
facility given.
b. The employer cannot exempt himself from
liability to pay minimum wages because of poor
financial condition of the company  Reason: The
payment of minimum wages is NOT dependent on
the employer's ability to pay.
2. Gaa v. CA: Under the Civil Code, only WAGES are
exempted from attachment and execution
Wages Salary
Compensation for Denotes a higher degree
manual labor, , skilled or of employment, or a
unskilled, paid at stated superior grade of
times, and measured by services, and implies a
the day, week, month, or position of office:
season,  3. The elimination of the distinction between the two
3. Philex Gold Phil., Inc. v. Philex Bulawan
Supervisors Union:
 “Equal pay FOR equal work”
Persons who work with substantially equal
qualification, skill, effort and responsibility [QSER],
under similar conditions, should be paid similar
salaries
 If an employer accords employees the same
position and rank, the presumption is that
these employees perform equal work.
This is a (disputable) PRESUMPTION borne out of
logic and human experience
*In this case, the company failed to explain why the
EEs were treated unfairly.
ISAE v. Quisumbing: Same. No proof that local hires
perform better than foreign-hires.
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1. Planas Commercial v. NLRC
Wage Rationalization Act EXEMPTS establishment
employing not more than 10 workers upon
APPLICATION with the Regional Board
2. Pag-Asa Steel Works, Inc. v. CA
Whether or not the company should grant the wage
increase under Wage Order by virtue of company practice.
NO. Wage Order is clear that it only applies to EEs
whose salary is less than 223.50. All of the EEs that
time are receiving more than that.
Even assuming the company will give it as a matter of
practice, the same CANNOT ripen into a company
practice because the same is an ACT OF
LIBERALITY.
Sevilla Trading Co. v. Semana --
To constitute company practice, it must be:
a. Practice over a long period of time; and
b. Must be consistent and deliberate despite
knowledge that it should not be given
Effect: It CANNOT be UNILATERALLY
WITHDRAWN later on. Otherwise, diminution of
benefits (art. 100)
In this case, it is a company practice when from 1975-
1981, the comapny includes in the computation of its
13th month pay the premium on rest days and special
holidays.
3. Prubankers Assoc. v. Prudential Bank
The implementation of wage orders in one region but
not in others does NOT in itself necessarily result in
wage distortion  Reason: There are different
necessities between regions
Wage distortion: Situation where an increased in
prescribed wages resulted to “elimination” of
intentional quantitative differences among the
employees [CHER]
1. An existing hierarchy of positions with
corresponding salary rates
2. A significant change in the salary rate of a lower
pay class without a concomitant increase in the salary
rate of a higher one
levels
4. The existence of the distortion in the same region of
the country
IC. PAYMENT OF WAGES
1. Aklan Electric Coop. v. NLRC
EEs believe that they are illegally transferred although the
same was not made in bad faith
“No work, no pay”
"Fair days wage for a fair days labor"
XPN: If EE is illegally locked out, suspended or
dismissed.
Both parties must prove their allegations through
AFFIRMATIVE ALLEGATIONS
2. Five J Taxi v. NLRC
Deposits for loss or damage
GR: Deposit for loss or damage should NOT be
required
XPN: If TOB where the practice of making deposit is a
RECOGNIZED one
3. Radio Communication Phils. V. SOL
Union service fee: Payment for representation of
union in behalf of the employee.
ID. PROHIBITIONS REGARDING
WAGES
1. Commando Security Agency v. NLRC
Deducting an amount from EE’s salary as company’s
share for job procurement is NOT legal since it is
against public policy – no consent; not allowed by
law
2. Apodaca v. NLRC
Can non-payment of stock subscription be OFFSET
against a money claim
No. Aside from the fact that the NLRC has no
jurisdiction, an unpaid stock subscription can only be
had when it is due and demandable such as when
there is a call made by the corporation for payment.
***
ART. 113. Wage Deduction. — No employer, in his
own behalf or in behalf of any person, shall make any
deduction from the wages of his employees, except:
[ICA]
(a) In cases where the worker is insured with his
consent by the employer, and the deduction is to
recompense the employer for the amount paid by him
as premium on the insurance;
(b) For union dues, in cases where the right of the
worker or his union to checkoff has been recognized
by the employer or authorized in writing by the
individual worker concerned; and
(c) In cases where the employer is authorized by law
or regulations issued by the Secretary of Labor.
IIA. HOURS OF WORK
Includes ALL TIME during which an EE is:
a. Required to be on duty or to be at the workplace
b. EE is suffered to work/permitted to work
Note: Rest periods of short duration should be
counted, e.g. coffee break of 15 mins; meal periods of
less than 30 mins.
XPNs (6): Not covered
a. Government EEs
b. Managerial EEs (Salazar v. NLRC)
c. Field personnel (San Miguel Brewery v.
Democratic Labor Union – salesman NOT allowed for
overtime  Reason: Payment is based on gross
receipts)
d. Members of the EEs who are dependent on him for
support
e. Domestic helpers and persons in the personal
service of another
f. Workers who are paid by results, e.g. piece
workers, "pakiao"
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Q: What is the NUMBER OF HOURS required?
GR: It should NOT exceed 8 hours a day for 6 days a
week
XPN: Health personnel – who hold 8 hours a day for
5 days a week
Otherwise, if 6 days, they are required to additional
30% of their regular wage for the 6th day.
Note: Article 83 does NOT prohibit less than 8 hours
of work. It only sets a max. number of hours of work.
Q: How about OVERTIME?
It should be in EXCESS of the 8 hours
Basis for overtime pay: Based on regular basic pay
Reason for overtime payment: Because of the adverse
effects upon him for staying longer
Pampanga Sugar Development v. CIR: Overtime pay
CANNOT be waived; otherwise, it will not be
binding and will not bar claims for payment of
overtime
XPNs:
a. If it is in exchange of certain valuable benefits
b. CWW provided that the total number of hours per
day should not exceed 12 hours
 There must be an agreement
o If firms using substances, there
must be a certification from
accredited health and safety
organization
 The DOLE should be notified
Note: Reversion to 8 hours is allowed as it is a
management prerogative provided that there is prior
notice
It is when  NORMAL WORK WEEK IS REDUCED
TO LESS THAN SIX DAYS BUT THE TOTAL
NUMBER OF NORMAL WORK HOURS PER WEEK
SHALL REMAIN AT FORTY-EIGHT (48) HOURS.
Q: What is the rule on UNDERTIME?
Undertime is NOT offset by overtime
NWSA v. NWSA Unions: Otherwise, that would place
the working schedule at the mercy of the EE.
The proper method should be to deduct the
undertime from the accrued leave BUT pay the
employee the overtime to which he is entitled.
Q: What is the rule on MEAL BREAKS?
Duty of every ER to give 60 minutes of meal break
 Nothing in the law that it should be made
inside only
Meal period = Overtime work
 When EEs are required to standby for
emergency works (PanAm World Airways
v. PanAm Employees Assoc.) In the case, the
mechanics were required to stand by for
emergency work; that if they happened not
to be available when called, they were
reprimanded by the leadman; that as in fact
it happened on many occasions, the
mechanics had been called from their meals
 or told to hurry Employees Association up
eating to perform work during this period.
Q: When is WAITING TIME compensable?
When the EE is subject to ABSOLUTE CONTROL
OF ER such that he is deprived to attend to his
personal pursuits (Arica v. NLRC) as to the 30-minute
assembly time
Q: What is the rule on BROWNOUTS?
If less than 20 mins: Compensable
If more than 20 mins: Not working hours provided
that
a. EEs can leave their workplace; and
b. EEs can use time for own interest
*In each case, ER may EXTEND working hours for
productivity.
Q: What is the rule on COMMUTING TIME?
GR: Not compensable
XPN: When EE is under supervision of ER
Q: What is the rule on TRAVEL TIME?
It is compensable when:
a. Within work hours; or
b. Outside work hours BUT involves performance of
work
Mercury Drug v. Dayao: 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
XPN: 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.
IIB. WEEKLY REST PERIODS
Remerco Garments v. Minister of Labor
 Duty of the ER to give a 24-hour rest day
 ER should determine which day shall be
subject to rest day.
 ER should respect the preference of EEs as to
their rest days based on religious grounds.
IIC. HOLIDAYS
XPNs: Shall not cover the following: [GoRDoMF]
a. Government EEs
b. Retail and service establishment employing less
than 10 employees*
c. Domestic workers
d. Managerial employees; and
e. Field personnel
Holiday benefit:
 If regular holiday
o Did not work: Entitled to 100% of
his regular basic wage PROVIDED
that:
a. He was present; or
b. He was on LOA with
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pay on the day IMMEDIATELY
PRECEDING the holiday
o Worked: Entitled to 200% of his
regular basic wage
 If special holiday:
o Did not work: Not entitled to
compensation (“no work, no pay”)
o Worked: Entitled to 130% of his
basic pay
o If he (a) worked and it (b) concurs
with his scheduled rest day: 150%
1. Jose Rizal College v. NLRC:
W/N a school faculty paid per lecture hour is entitled
to unworked holiday pay?
Yes
2. Producers Bank v. NLRC:
Basic salary x 12 months = Daily Wage Rate
303 days
As to divisor used to compute monthly pay:
o If 6-working days:
314: 10 legal holidays are already included
o If 5-working days:
261: 10 legal holidays are included in the monthly
salary of the EE
3. SMC v. CA
Muslim Holidays are considered as regular holidays
for both Muslims and non-Muslims (no distinction) 
Basis: Reciprocity; wages and emoluments granted by
law are determined by law, not by religion
4. Asian Transmission Corporation v. CA
Double holiday pay: Araw ng Kagitingan + Good
Friday = EE entitled to 300% basic wage for both
holidays provided he satisfied the 2 conditions
IID. SERVICE INCENTIVE LEAVE
It is 5-days leave with pay for every EE who has
rendered at least 1 year of service.
o Service within 12 months
o Whether continuous or broken – including
absences and paid holidays
o Reckoned from the date of employment
(Imbuido v. NLRC – where SIL computation
is up to the date of reinstatement in case of
illegal dismissal)
Purpose: MOTIVATION for the EE to stay longer
with the ER (JPL Marketing Promotions v. CA)
XPN: Establishments employing less than 10 EEs
IRR adds:
a. Government EEs
b. Domestic EEs
c. Managerial EEs
d. Field personnel whose work is unsupervised by the
ER
Bus Transport Systems, Inc. v. Bautista: This means
field personnel whose hours of work CANNOT be
determined with reasonable certainty.
Hence, bus drivers and conductors are NOT included
because bus companies have the means to know their
hours work because:
a. There are inspectors along strategic places;
b. There is a mandatory checking once a week;
c. They must be at a place of destination at a specified
time and place;
d. At every depot, there is always a dispatcher
Contra: Boie-Takeda Chemicals v. Dela Serna:
Productivity bonuses are NOT commissions; hence,
not part of basic salary for purposes of computing 13 th
month pay  Reasons: (a) Medical representatives are
not salesmen; (b) it partook the nature of a “profit-
sharing bonuses”
Q: When does pro-ration of 13th month pay apply:
Only in case of RESIGNATION or SEPARATION
OF WORK; computation should be based on length of
service and not on actual wage earned by worker
(Honda Phils. V. Samahan ng Malalayang
Manggagawa)
Note: 14th month pay and others are management
prerogatives.

Commutation of Unused SIL

It is commutable to its money equivalent if not used
or exhausted at the end of the year  at the time of
his (a) resignation or (b) separation from work
(Fernandez v. NLRC)

Note: VL are NOT convertible to cash  Reason: No

provision in the LC; hence, it depends on the
prerogative of the ER

III. 13TH MONTH PAY

It is an additional income BASED on wage
BUT not PART of wage

It is equivalent to 1/12 of the total basic salary earned

by the EE

EE must have worked 1 month during a calendar

year

Note: An Er may give to his Ees ½ of the required

13th Month pay before the opening of the regular
school year and the other half on or before Dec. 24.

It could be given, through legal tender, in the form of:

a. Christmas bonus;
b. Midyear Bonus
c. Profit sharing scheme;
d. Other cash bonuses amounting to not less than
1/12 of basic salary

XPNs:
a. Government EEs
b. Household EEs
c. EEs paid on commission basis

Phil. Agricultural Commercial & Industrial Workers

v. NLRC:
a. But those paid a GUARANTEED WAGE +
COMMISSION in case the commission are less than
the statutory minimum
b. Also those who are paid commissions only in case
where the same is over and above the statutory
minimum

d. EEs already receiving 13th month pay

Phil. Duplicators, Inc. v. NLRC: Salesman

commissions are considered in computing 13th
month pay; hence, part of the basic salary  Reason:
Related to the effort of the EE