THE CANTEEN CONCESSIONAIRE

PMP Manufacturing Corporation is engaged in the production of quality spare parts for
motorcycles for export and for local sales. The plant employs more than 300 line workers and employs
about 35 office personnel.

The canteen that serves snacks and regular meals is located inside the plant. The operator is an
outside concessionaire who pays no rent, water, power and electricity. While it is private in nature and
independent of the company, the canteen owner is a relative of the company president. The company
provides all the facilities including plates, spoons, forks, and other kitchen utensils.

Angie the concessionaire manager has been complaining to Mr. Nonoy Padrones, the personnel
manager that the cost of food has gone up since the implementation of the EVAT law and that he cannot
afford to serve meals at the current price of viands at Php20.00 per serving and rice at Php5.00 per cup.
Mr. Padrones can not give any definite answer to the problem of Ms. Angie as he has to discuss this with
management and the employees’ association.

In the meeting with the employees’ association, Ronald the president complained that the
employees are not satisfied with the kind of service the canteen has been giving them. He stated that
the food choices are limited and that most servings are vegetables and meat; the food is the almost the
same every day. He suggested that a new concessionaire be hired instead.

Mr. Padrones is in deep thought in his office on how to solve the problem, how to tell the
company president about the canteen concessionaire problem and the request of the employees for a
change in canteen operator.

He is thinking of either a food subsidy and allowance or to give the employees their meal chits
and charge meals to company funds.