Burden of Proof of monetary claims

Cases:
1. Loon vs. Power Master G.R. No. 189404, Dec. 11, 2013
2. Reyman G. Minsola vs. New City Builders, Inc., G.R. No. 207613, January 31, 2018

1. Loon vs. Power Master G.R. No. 189404, Dec. 11, 2013

WILGEN LOON, JERRY ARCILLA, ALBERTPEREYE, ARNOLD PEREYE,

EDGARDO OBOSE, ARNEL MALARAS, PATROCINO TOETIN, EVELYN
LEONARDO, ELMER GLOCENDA, RUFO CUNAMAY, ROLANDOSAJOL,
ROLANDO ABUCAYON, JENNIFER NATIVIDAD, MARITESS TORION, ARMANDO
LONZAGA, RIZAL GELLIDO, EVIRDE HAQUE,1 MYRNA VINAS, RODELITO
AYALA, WINELITO OJEL, RENATO RODREGO, NENA ABINA, EMALYN
OLIVEROS, LOUIE ILAGAN, JOEL ENTIG, ARNEL ARANETA, BENJAMIN COSE,
WELITO LOON and WILLIAM ALIPAO, Petitioners,
vs.
POWER MASTER, INC., TRI-C GENERAL SERVICES, and SPOUSES HOMER and
CARINA ALUMISIN, Respondents.

G.R. No. 189404, December 11, 2013, BRION, J.:

Burden of Proof:
In termination cases, the burden of proving just and valid cause for dismissing an employee from
his employment rests upon the employer. The employer’s failure to discharge this burden results
in the finding that the dismissal is unjustified. This is exactly what happened in the present case.

In illegal dismissal cases, the general rule is that the burden rests on the defendant to prove
payment rather than on the plaintiff to prove nonpayment of these money claims. The rationale
for this rule is that the pertinent personnel files, payrolls, records, remittances and other similar
documents — which will show that differentials, service incentive leave and other claims of
workers have been paid — are not in the possession of the worker but are in the custody and
control of the employer.

The burden of proving entitlement to overtime pay and premium pay for holidays and rest days
rests on the employee because these are not incurred in the normal course of business. —The CA
was correct in its finding that the petitioners failed to provide sufficient factual basis for the
award of overtime, and premium pays for holidays and rest days. In the present case, the
petitioners failed to adduce any evidence that would show that they actually rendered service in
excess of the regular eight working hours a day, and that they in fact worked on holidays and rest
days.

FACTS:

Respondents Power Master, Inc. and Tri-C General Services employed and assigned the
petitioners as janitors and leadsmen in various Philippine Long Distance Telephone Company
(PLDT) offices in Metro Manila area. Subsequently, the petitioners filed a complaint for money
claims against Power Master, Inc., Tri-C General Services and their officers, the spouses Homer
and Carina Alumisin (collectively, the respondents). The petitioners alleged in their complaint
that they were not paid minimum wages, overtime, holiday, premium, service incentive leave,
and thirteenth month pays. They further averred that the respondents made them sign blank
payroll sheets.

On June 11, 2001, the petitioners amended their complaint and included illegal dismissal
as their cause of action. They claimed that the respondents relieved them from service in
retaliation for the filing of their original complaint.

Notably, the respondents did not participate in the proceedings before the Labor Arbiter
except on April 19, 2001 and May 21, 2001 when Mr. Romulo Pacia, Jr. appeared on the
respondents’ behalf. The respondents’ counsel also appeared in a preliminary mandatory
conference on July 5, 2001.

LA’s Ruling: The LA awarded the petitioners salary differential, service incentive leaves and
13th month pays. In awarding these claims the LA stated that the burden in proving the payment
of these money claims rests with the employer. However, they were not awarded backwages,
overtime, holiday and premium pays for failure to show that they rendered overtime work and
worked on holidays. Moreover, it was not decided that they were illegally dismissed for failure
to show notice of termination of employment.

NLRC: Both parties appealed to the ruling of the LA. NLRC affirmed LA’s ruling with regard
the payment of holiday pay and attorney’s fees but vacated the awards of salary differential, 13 th
month pays and service incentive leaves. Moreover, NLRC allowed the respondents to present
pieces of evidence for the first time on appeal on the ground that they have been deprived of due
process. It also ruled that petitioners were legally dismissed due to gross misconduct.

CA: The CA affirmed the NLRC’s ruling. The CA held that the petitioners were afforded
substantive and procedural due process.

ISSUES:

1. Whether the petitioners were illegally dismissed and are thus entitled to backwages; (Yes)
2. Whether the petitioners are entitled to salary differential, overtime, holiday, premium,
service incentive leave, and thirteenth month pays

RULING:

1. Yes, the petitioners are entitled to backwages. The Supreme Court reverse the NLRC and
the CA’s finding that the petitioners were terminated for just cause and were afforded
procedural due process. In termination cases, the burden of proving just and valid cause
for dismissing an employee from his employment rests upon the employer. The
employer’s failure to discharge this burden results in the finding that the dismissal is
 unjustified.40 This is exactly what happened in the present case.
2. Yes, the petitioners are entitled to salary differential, service incentive, holiday, and
thirteenth month pays. The Supreme Court also reverse the NLRC and the CA’s finding
that the petitioners are not entitled to salary differential, service incentive, holiday, and
thirteenth month pays. As in illegal dismissal cases, the general rule is that the burden
rests on the defendant to prove payment rather than on the plaintiff to prove non-payment
of these money claims. The rationale for this rule is that the pertinent personnel files,
payrolls, records, remittances and other similar documents – which will show that
differentials, service incentive leave and other claims of workers have been paid – are not
in the possession of the worker but are in the custody and control of the employer.

However, the petitioners are not entitled to overtime and premium pays. The CA was
correct in its finding that the petitioners failed to provide sufficient factual basis for the
award of overtime, and premium pays for holidays and rest days. The burden of proving
entitlement to overtime pay and premium pay for holidays and rest days rests on the
employee because these are not incurred in the normal course of business. 43 In the present
case, the petitioners failed to adduce any evidence that would show that they actually
rendered service in excess of the regular eight working hours a day, and that they in fact
worked on holidays and rest days.

The Supreme Court REVERSE and SET ASIDE the decision and the resolution of the
Court of Appeals. The case is REMANDED to the Labor Arbiter for the sole purpose of
computing petitioners' (Wilgen Loon, Jerry Arcilla, Albert Pereye, Arnold Pereye,
Edgardo Obose, Arnel Malaras, Patrocino Toetin, Evelyn Leonardo, Elmer Glocenda,
Rufo Cunamay, Rolando Sajol, Rolando Abucayon, Jennifer Natividad, Maritess Torion,
Ammndo Lonzaga, Rizal Gellido, Evirdly Haque, Myrna Vinas, Nena Abina, Emalyn
Oliveros, Louie Ilagan, Joel Entig, Amel Araneta, Benjamin Cose and William Alipao)
full backwages (computed from the date of their respective dismissals up to the finality of
this decision) and their salary differential, service incentive leave, holiday, thirteenth
month pays, and attorney's fees equivalent to ten percent (10%) of the withheld wages.
The respondents are further directed to immediately post a satisfactory bond conditioned
on the satisfaction of the awards affirmed in this Decision.

2. Reyman G. Minsola vs. New City Builders, Inc., G.R. No. 207613, January 31,
2018

REPEATED REHIRING OF PROJECT EMPLOYEES IN A CONSTRUCTION

INDUSTRY IS NOT A BADGE OF REGULARIZATION

Reyman Minsola vs. New City Builders Inc. and Engr. Ernel Fajardo
G.R. No. 207613; January 31, 2018
Bersamin, J.

FACTS:
 This case involves a petition for review on Certiorari under Rule 45 seeking to reverse
the decision and resolution of the CA, which dismissed petitioner Reyman Minsola’s (Minsola)
complaint for illegal dismissal.

Petitioner Minsola was hired by respondent New City Builders, a corporation engaged in the
construction business, as a laborer for the structural phase and as a mason for the architectural
phase of Avida 3, respectively. Upon reviewing his employment record, respondent found that
petitioner was lacking in appointment paper. Hence, the former instructed the latter to update his
employment records which the petitioner ignored and who subsequently never went back to
work after being reminded to sign the appointment paper once again. Petitioner then filed an
illegal dismissal case before the LA which was dismissed. On appeal to the NLRC, the latter
reversed the ruling of the LA. Respondent then filed a motion for reconsideration of the decision
which was denied which led it to file a petition for certiorari under Rule 65 with the CA.
Petitioner alleged that his work as a laborer and mason was necessary and desirable to the
business of the employer and that his rehiring which resulted to his working for more than one
year makes him a regular employee. On the other hand, respondent averred that petitioner was
hired as a project employee for the two different phases and that his tasks were completely
different from each project.

ISSUE:
Was petitioner’s repeated rehiring enough to make him a regular employee?

RULING:
No. The repeated rehiring of Minsola did not make him a regular employee of the
respondent.

It is not uncommon for a construction firm to hire project employees to perform work
necessary and vital for its business. In William Uy Construction Corp. and/or Uy, et al. v.
Trinidad, the SC acknowledged the unique characteristic of the construction industry and
emphasized that the laborer's performance of work that is necessary and vital to the employer's
construction business, and the former's repeated rehiring, do not automatically lead to
regularization. Additionally, the employee's tenure "is not permanent but coterminous with the
work to which he is assigned." Consequently, it would be extremely burdensome for the
employer, who depends on the availability of projects, to carry the employee on a permanent
status and pay him wages even if there are no projects for him to work on. An employer cannot
be forced to maintain the employees in the payroll, even after the completion of the project.

Accordingly, it is all too apparent that the employee's length of service and repeated
rehiring constitutes an unfair yardstick for determining regular employment in the construction
industry.

Thus, Minsola's rendition of more than one year of service and his repeated re-hiring are
not badges of regularization.
Service Incentive Leave

Cases:
1. Fernandez vs. NLRC, G.R. No. 105892, 28 January 1998;
2. Auto Bus Transport Systems Inc. vs. Bautista, G.R. No 156367, 16 May 2005; (important
case)
3. Mansion Printing Center vs. Bitara Jr., G.R. 168120, January 25, 2012;
4. Vivian Y. Imbuido v. NLRC et. al. G.R. No. 114734, March 31, 2000;
5. Ariel L. David vs. John Macasio G.R. No. 195466, July 02, 2014; (important case)

1. Fernandez vs. NLRC, G.R. No. 105892, 28 January 1998; Panganiban, J.

SUMMARY: Fernandez, et al demanded an increase in their salaries. They were dismissed

shortly thereafter. LA found that Fernandez et al. were illegally dismissed. LA awarded, among
others, service incentive pay to petitioners in varying based on the length of their tenure. NLRC
reversed the LA.

DOCTRINE: An employee who has served for one year is entitled to service incentive
leave/pay. He may use it as leave days or he may collect its monetary value. Since a service
incentive leave is clearly demandable after one year of service (whether continuous or broken) or
its equivalent period, and it is one of the benefits which would have accrued if an employee was
not illegally dismissed, it is fair and legal that its computation should be up to the date
reinstatement as provided under Section 279.

FACTS:

The instant case stemmed from a consolidated complaint against private respondents
Agencia Cebuana-H. Lhuillier and/or Margueritte Lhuillier (Lhuillier) for illegal dismissal (Rec.,
pp. 56-58). The Agencia Cebuana is a sole proprietorship operated by Margueritte Lhuillier.

Petitioners demanded an increase in their wages considering the business was booming
and the employer was falsifying her taxes and informed employer that they will join the
Associated Labor Union (ALU), which made Lhuillier angry, causing her to threaten them that
should they report her to the BIR and join the ALU something would happen to their
employment. Their employer told them to render their resignations because of some alleged
anomalies by them. Private respondent said that petitioners did not report for work and
voluntarily abandoned their work on July 19, 1990, and they were not dismissed from their
employment hence they have no cause of action against her.

Labor Arbiter favored petitioners but NLRC vacated the labor arbiter’s order. MR denied.
Hence, this petition.

SC ruled that the petitioners, except Lim and Canonigo, were illegally dismissed so it had to
rule now on the money claims. The labor arbiter granted varying amounts of service incentive
leave pay to the petitioners based on the length of their tenure; i.e, the shortest was six years and
the longest was thirty-three years. While recommending that the labor arbiters decision be
reinstated substantially, the solicitor general recommended that the award of service incentive
leave be limited to three years. This is based on Article 291 of the Labor Code which provides:

ART. 291. Money Claims.  All money claims arising from employer-

employee relations accruing during the effectivity of this Code shall be filed within
three (3) years from the time the cause of action accrued; otherwise they shall be
forever barred

ISSUE:

Whether or not the service incentive leaves may be limited to a certain number of years.

RULING:

No. The clear policy of the Labor Code is to grant service incentive leave pay to workers
in all establishments, subject to a few exceptions. Section 2, Rule V, Book III of the
Implementing Rules and Regulations provides that [e]very employee who has rendered at least
one year of service shall be entitled to a yearly service incentive leave of five days with pay. 

Service incentive leave is a right which accrues to every employee who has served within
12 months, whether continuous or broken reckoned from the date the employee started working,
including authorized absences and paid regular holidays unless the working days in the
establishment as a matter of practice or policy, or that provided in the employment contracts, is
less than 12 months, in which case said period shall be considered as one year. 

It is also commutable to its money equivalent if not used or exhausted at the end of the
year. In other words, an employee who has served for one year is entitled to it. He may use it as
leave days or he may collect its monetary value. To limit the award to three years, as the solicitor
general recommends, is to unduly restrict such right. The law indeed does not prohibit its
commutation.

2. AUTO BUS TRANSPORT SYSTEMS, INC., Petitioner, -versus- ANTONIO

BAUTISTA, Respondent. (important case)
G.R. No. 156367, SECOND DIVISION, May 16, 2005, CHICO-NAZARIO, J.

It is necessary to stress that the definition of a "field personnel" is not merely concerned with the
location where the employee regularly performs his duties but also with the fact that the
employee's performance is unsupervised by the employer. As discussed above, field personnel
are those who regularly perform their duties away from the principal place of business of the
employer and whose actual hours of work in the field cannot be determined with reasonable
certainty. Thus, in order to conclude whether an employee is a field employee, it is also
necessary to ascertain if actual hours of work in the field can be determined with reasonable
certainty by the employer. In so doing, an inquiry must be made as to whether or not the
employee's time and performance are constantly supervised by the employer.

As observed by the Labor Arbiter and concurred in by the Court of Appeals:

It is of judicial notice that along the routes that are plied by these bus companies, there
are its inspectors assigned at strategic places who board the bus and inspect the
passengers, the punched tickets, and the conductor's reports. There is also the mandatory
once-a-week car barn or shop day, where the bus is regularly checked as to its
mechanical, electrical, and hydraulic aspects, whether or not there are problems thereon
as reported by the driver and/or conductor. They too, must be at specific place as [sic]
specified time, as they generally observe prompt departure and arrival from their point
of origin to their point of destination. In each and every depot, there is always the
Dispatcher whose function is precisely to see to it that the bus and its crew leave the
premises at specific times and arrive at the estimated proper time. These, are present in
the case at bar. The driver, the complainant herein, was therefore under constant
supervision while in the performance of this work. He cannot be considered a field
personnel.

FACTS:

Respondent Antonio Bautista was employed by petitioner Auto Bus Transport Systems, Inc.
(Autobus) as driver-conductor with travel routes Manila-Tuguegarao via Baguio, Baguio-
Tuguegarao via Manila and Manila-Tabuk via Baguio. Respondent was paid on commission
basis, 7% of the total gross income per travel, on a twice a month basis.

While respondent was driving along Sta. Fe, Nueva Vizcaya, the bus he was driving accidentally
bumped the rear portion of Autobus No. 124, as the latter vehicle suddenly stopped at a sharp
curve without giving any warning. He was received a letter of termination from the management
of Autobus.

Respondent averred that the accident happened because he was compelled by the management to
go back to Roxas, Isabela, although he had not slept for almost twenty-four hours, as he had just
arrived in Manila from Roxas, Isabela. Respondent further alleged that he was not allowed to
work until he fully paid the cost of repair of the damaged buses and that despite respondent's
pleas for reconsideration, the same was ignored by management. After a month, management
sent him a letter of termination.

Thus, respondent instituted a Complaint for Illegal Dismissal with Money Claims for
nonpayment of 13 month pay and service incentive leave pay against Autobus.

The labor arbiter dismissed the complaint for Illegal Dismissal but ordered Autobus to pay
respondent his 13th month pay and his service incentive leave pay for all the years he had been
in service with the respondent.

Autobus appealed the decision to the NLRC which deleted the award of 13th month pay to citing
Sec 3 of the Rules and Regulations Implementing PD 851 which provides:

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

e) employers of those who are paid on purely commission, boundary, or task basis,
performing a specific work, irrespective of the time consumed in the performance
thereof. xxx."

In other words, the award of service incentive leave pay was maintained. Petitioner thus sought a
reconsideration of this aspect, which denied in a Resolution by the NLRC.

Displeased with only the partial grant of its appeal to the NLRC, petitioner sought the review of
said decision with the CA which was subsequently denied by the appellate court.

ISSUE:

Whether respondent is entitled to service incentive leave. (YES)

RULING:

Article 95 of the Labor Code and Section 1(D), Rule V, Book III of the Implementing Rules and
Regulations of the Labor Code provide:

Art. 95. RIGHT TO SERVICE INCENTIVE LEAVE

(a) Every employee who has rendered at least one year of service shall be entitled to a
yearly service incentive leave of five days with pay.

Book III, Rule V: SERVICE INCENTIVE LEAVE

SECTION 1. Coverage. – This rule shall apply to all employees except:

(d) Field personnel and other employees whose performance is unsupervised by the
employer including those who are engaged on task or contract basis, purely commission
basis, or those who are paid in a fixed amount for performing work irrespective of the
time consumed in the performance thereof; . . .

A careful perusal of said provisions of law will result in the conclusion that the grant of service
incentive leave has been delimited by the Implementing Rules and Regulations of the Labor
Code to apply only to those employees not explicitly excluded by Section 1 of Rule V.
According to the Implementing Rules, Service Incentive Leave shall not apply to employees
classified as "field personnel." The phrase "other employees whose performance is unsupervised
by the employer" must not be understood as a separate classification of employees to which
service incentive leave shall not be granted. Rather, it serves as an amplification of the
interpretation of the definition of field personnel under the Labor Code as those "whose actual
hours of work in the field cannot be determined with reasonable certainty."
The same is true with respect to the phrase "those who are engaged on task or contract basis,
purely commission basis." Said phrase should be related with "field personnel," applying the rule
on ejusdem generis that general and unlimited terms are restrained and limited by the particular
terms that they follow. Hence, employees engaged on task or contract basis or paid on purely
commission basis are not automatically exempted from the grant of service incentive leave,
unless, they fall under the classification of field personnel.

Therefore, petitioner's contention that respondent is not entitled to the grant of service incentive
leave just because he was paid on purely commission basis is misplaced. What must be
ascertained in order to resolve the issue of propriety of the grant of service incentive leave to
respondent is whether or not he is a field personnel.

According to Article 82 of the Labor Code, "field personnel" shall refer to non-agricultural
employees who regularly perform their duties away from the principal place of business or
branch office of the employer and whose actual hours of work in the field cannot be determined
with reasonable certainty. This definition is further elaborated in the Bureau of Working
Conditions (BWC), Advisory Opinion to Philippine Technical-Clerical Commercial Employees
Association which states that:

As a general rule, [field personnel] are those whose performance of their job/service is
not supervised by the employer or his representative, the workplace being away from the
principal office and whose hours and days of work cannot be determined with reasonable
certainty; hence, they are paid specific amount for rendering specific service or
performing specific work. If required to be at specific places at specific times, employees
including drivers cannot be said to be field personnel despite the fact that they are
performing work away from the principal office of the employee.

The definition of a "field personnel" is not merely concerned with the location where the
employee regularly performs his duties but also with the fact that the employee's performance is
unsupervised by the employer. As discussed above, field personnel are those who regularly
perform their duties away from the principal place of business of the employer and whose actual
hours of work in the field cannot be determined with reasonable certainty. Thus, in order to
conclude whether an employee is a field employee, it is also necessary to ascertain if actual
hours of work in the field can be determined with reasonable certainty by the employer. In so
doing, an inquiry must be made as to whether or not the employee's time and performance are
constantly supervised by the employer.

As observed by the Labor Arbiter and concurred in by the Court of Appeals:

It is of judicial notice that along the routes that are plied by these bus companies, there
are its inspectors assigned at strategic places who board the bus and inspect the
passengers, the punched tickets, and the conductor's reports. There is also the mandatory
once-a-week car barn or shop day, where the bus is regularly checked as to its
mechanical, electrical, and hydraulic aspects, whether or not there are problems thereon
as reported by the driver and/or conductor. They too, must be at specific place as [sic]
specified time, as they generally observe prompt departure and arrival from their point of
 origin to their point of destination. In each and every depot, there is always the
Dispatcher whose function is precisely to see to it that the bus and its crew leave the
premises at specific times and arrive at the estimated proper time. These, are present in
the case at bar. The driver, the complainant herein, was therefore under constant
supervision while in the performance of this work. He cannot be considered a field
personnel.

We agree in the above disquisition. Therefore, as correctly concluded by the appellate court,
respondent is not a field personnel but a regular employee who performs tasks usually necessary
and desirable to the usual trade of petitioner's business. Accordingly, respondent is entitled to the
grant of service incentive leave.

3. MANSION PRINTING CENTER and CLEMENT CHENG

v. DIOSDADO BITARA, JR.

FACTS:

Petitioners engaged the services of respondent as a helper (kargador) who was later promoted as
the company’s sole driver. Due to the petitioner’s habitual tardiness, the petitioners issued a
memorandum requiring respondent to submit a written explanation why no administrative
sanction should be imposed on him. Despite respondent’s undertaking to report on time, he
continued to disregard attendance policies. The respondent’s absences without prior notice and
approval from March 11-16, 2000 were considered to be the most serious infraction of all
because of its adverse effect on business operations. Consequently, the petitioner issued again
another memorandum (Notice to Explain) requiring respondent to explain why his services
should not be terminated. The respondent did not submit any explanation and, thereafter, never
reported for work. The petitioner personally served another memorandum (Notice of
Termination) upon him. The respondent met with the management requesting for reconsideration
of his termination from the service. However, after hearing his position, the management decided
to implement the Notice of Termination. Respondent filed a complaint for illegal dismissal
against the petitioners before the Labor Arbiter. He prayed for his reinstatement and for the
payment of full back wages, legal holiday pay, service incentive leave pay, damages and
attorney’s fees. The Labor Arbiter dismissed the complaint for lack of merit. On appeal to the
National Labor Relations Commission, the findings of the Labor Arbiter were AFFIRMED en
toto. The respondent sought the annulment of the Commission’s Resolution before the Court of
Appeals; The Court of Appeals found for the respondent and reversed the findings of the
Commission. The Court of Appeals denied respondent’s Motion for Reconsideration of the
decision for lack of merit. Hence, the instant petition.

ISSUES:

1. Whether or not the respondent’s termination of employment is valid.

2. Whether or not the respondent is entitled to a claim for non-payment of holiday pay, service
incentive leave pay, moral and exemplary damages.
RULING:

1. YES. The Court affirms the ruling of the National Labor Relations Commission that the
dismissal was valid. In order to validly dismiss an employee, the employer is required to
observe both substantive and procedural aspects – the termination of employment must
be based on a just or authorized cause of dismissal and the dismissal must be effected
after due notice and hearing. The Court finds that the recent absences of the respondent
were unauthorized and were satisfactorily established by petitioners. Clearly, even in the
absence of a written company rule defining gross and habitual neglect of duties,
respondent’s omissions qualify as such warranting his dismissal from the service. Despite
the petitioner’s undertaking, the respondent continued to either absent himself from work
or report late during the first quarter of 2000. The notices (Notice to Explain and the
Notice of Termination) by the petitioner have been validly served.

2. YES.As to respondent’s monetary claims, petitioners did not deny respondent’s

entitlement to service incentive leave pay as indeed, it is indisputable that he is entitled
thereto. As to the payment of holiday pay, the Court is convinced that respondent had
already received the same based on the cash vouchers on record. However, respondent
shall be entitled to the money equivalent of the five-day service incentive leave pay for
every year of service from the commencement of his employment up to its termination.
The Labor Arbiter shall compute the corresponding amount.

4. Vivian Y. Imbuido v. NLRC et. al. G.R. No. 114734, March 31, 2000; Buena, J.:

Summary: Vivian Imbuido was International Information Services' data encoder for 3 years,
entering into 13 3-month employment contracts for specific projects. She was terminated after
LAKAS petitioned the BLR for certification elections following an agreement between Imbuido
and 12 others to file a petition for certification election for the company's rank-and-file
employees. Imbuido filed a complaint for illegal dismissal, praying for service incentive leave
pay and 13 month differential pay. The LA ruled in Imbuido's favor and awarded service
incentive leave pay (among others). The NLRC reversed the LA but remanded the service
incentive leave claim. The SC upheld the LA's decision and held that Imbuido was entitled to
service incentive leave pay because she had been employed for 3 years, from dismissal up to
reinstatement.

DOCTRINE: Service incentive leave pay is demandable after 1 year of service, whether
continuous or broken or its equivalent period. Where there is illegal dismissal, it is computed up
to reinstatement.

FACTS:

International Information Services (the company) employed Vivian Imbuido as a data

encoder.
  Duration: August 26, 1988-October 18, 1991
 Manner: She would enter into an employment contract lasting for 3 months. She
did this 13 times.
 The contracts were for specific projects only. She was supposed to
abide by company rules and regulations for its employees.

Sometime in September 1991, Imbuido and 12 other employees agreed to file a petition for
certification election for the company's rank-and-file employees.

On October 8, 1991, LAKAS (Lakas Manggagawa sa Pilipinas) petitioned the BLR for
certification elections.

On October 18, 1991, Imbuido received a termination letter from the company's admin officer
due to low volume of work.

On May 25, 1992, Imbuido filed a complaint for illegal dismissal, praying for service incentive
leave pay and 13th month differential pay with the NLRC.

On August 25, 1992, LA Raul Aquino ruled in Imbuido's favour, ordering reinstatement with
backwages, and service incentive leave pay.

September 27, 1993: On appeal, the NLRC reversed the LA's decision but remanded the claim
for service incentive leave for further arbitration.

January 11, 1994: The NLRC denied Imbuido's MR.

Imbuido goes up to the SC though a Petition for Certiorari.

ISSUE:

WON Imbuido is entitled to service incentive leave pay - YES

RULING:

Yes, Imbuido is entitled to service incentive leave pay because she had worked for the
company for 3 years before she was dismissed. It is one of the benefits that accrues were it not
for an employee's illegal dismissal, so it should be computed up to the date of reinstatement.

The SC cited the case of Fernandez v. NLRC for the following points:

On the duration of employment needed: SILP is demandable after 1 year of service,

whether continuous or broken or its equivalent period.
 On the accrual of SIL in relation to illegal dismissal: SILP is one of the benefits that
would accrue if an employee was not otherwise illegally dismissed.

On the computation of SIL where there is illegal dismissal: Up to date of reinstatement

(Citing LC 285, as amended)

5. Ariel L. David vs. John Macasio G.R. No. 195466, July 02, 2014; (important case)

For: overtime pay, holiday pay, 13th month pay and payment for service incentive leave.

FACTS:

In January 2009, Macasio filed before the LA a complaint against petitioner Ariel L.
David, doing business under the name and style “Yiels Hog Dealer,” for non-payment of
overtime pay, holiday pay and 13th month pay. He also claimed payment for moral and
exemplary damages and attorney’s fees. Macasio also claimed payment for service incentive
leave (SIL) David claimed that he started his hog dealer business in 2005 and that he only has ten
employees. The LA concluded that as Macasio was engaged on “pakyaw” or task basis, he is not
entitled to overtime, holiday, SIL and 13th month pay. The NLRC affirmed the LA decision,
thus this case reach the CA which says that Macasio is entitled to his monetary claims following
the doctrine laid down in Serrano v. Severino Santos Transit. The CA explained that as a task
basis employee, Macasio is excluded from the coverage of holiday, SIL and 13th month pay only
if he is likewise a “field personnel.” Thus this case reached the SC.

ISSUE:

Whether or not Macasio is entitled of overtime pay, holiday pay, 13 th month pay and
payment for service incentive leave.

RULING:

Yes, in so far as the Holiday and SIL pay is concern. To determine whether workers
engaged on “pakyaw” ortask basis” is entitled to holiday and SIL pay, the presence (or absence)
of employer supervision as regards the worker’s time and performance is the key: if the worker is
simply engaged on pakyaw or task basis, then the general rule is that he is entitled to a holiday
pay and SIL pay unless exempted from the exceptions specifically provided under Article 94
(holiday pay) and Article 95 (SIL pay) of the Labor Code. However, if the worker engaged on
pakyaw or task basis also falls within the meaning of “field personnel” under the law, then he is
not entitled to these monetary benefits. CA that Macasio does not fall under the definition of
“field personnel.” The CA’s finding in this regard is supported by the established facts of this
case: first, Macasio regularly performed his duties at David’s principal place of business; second,
his actual hours of work could be determined with reasonable certainty; and, third, David
supervised his time and performance of duties. Since Macasio cannot be considered a “field
personnel,” then he is not exempted from the grant of holiday, SIL pay even as he was engaged
on “pakyaw” or task basis.
 However, the governing law on 13th month pay is PD No. 851. As with holiday and SIL
pay, 13th month pay benefits generally cover all employees; an employee must be one of those
expressly enumerated to be exempted. Section 3 of the Rules and Regulations Implementing P.D.
No. 851 enumerates the exemptions from the coverage of 13th month pay benefits. Under
Section 3(e), “employers of those who are paid on task basis, and those who are paid a fixed
amount for performing a specific work, irrespective of the time consumed in the performance
thereof are exempted. Note that unlike the IRR of the Labor Code on holiday and SIL pay,
Section 3(e) of the Rules and Regulations Implementing PD No. 851exempts employees "paid
on task basis" without any reference to "field personnel." This could only mean that insofar as
payment of the 13th month pay is concerned, the law did not intend to qualify the exemption
from its coverage with the requirement that the task worker be a "field personnel" at the same
time. Thus Macasio is not entitled to 13th month pay.

Wherefore, the petition was partially granted the petition insofar as the payment of 13th
month pay to respondent is concerned. But all other aspect of the CA’s decision was affirmed.