Ultra villa Food Haus v Geniston

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Honda v Samahan ng malayang manggagawa
Facts: The case stems from the collective bargaining agreement between Honda and the respondent
union that it granted the computation of 14th month pay as the same as 13th month pay. Honda
continues the practice of granting financial assistance covered every December each year of not less
than 100% of the basic salary. In the latter part of 1998, the parties started to re-negotiate for the fourth
and fifth years of the CBA. The union filed a notice of strike on the ground of unfair labor practice for
deadlock.

DOLE assumed jurisdiction over the case and certified it to the NLRC for compulsory arbitration. The
striking employees were ordered to return to work and management to accept them back under the
same terms prior to the strike staged. Honda issued a memorandum of the new computation of the
13th month and 14th month pay to be granted to all its employees whereby the 31 long strikes shall
be considered unworked days for purpose of computing the said benefits. The amount equivalent to
½ of the employees’ basic salary shall be deducted from these bonuses, with a commitment that in
the event that the strike is declared legal, Honda shall pay the amount.

The respondent union opposed the pro-rated computation of bonuses. This issue was submitted to
voluntary arbitration where it ruled that the company’s implementation of the pro-rated computation is
invalid.

Issue: Whether or not the pro-rated computation of the 13th and 14th month pays and other bonuses
in question is valid and lawful.

Ruling: The Court ruled that the pro-rated computation is invalid.

The pro-rated computation of Honda as a company policy has not ripened into a company practice
and it was the first time they implemented such practice.

The payment of the 13th month pay in full month payment by Honda has become an established
practice. The length of time where it should be considered in practice is not being laid down by
jurisprudence. The voluntary act of the employer cannot be unilaterally withdrawn without violating
Article 100 of the Labor Code.

The court also rules that the withdrawal of the benefit of paying a full month salary for 13th month pay
shall constitute a violation of Article 100 of the Labor Code.

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Framanlis farms v NLRC

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Kamaya port v NLRC

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Phil duplicators v NLRC

Facts:

Private respondent union, for and on behalf of its member-salesmen, asked petitioner corporation for
payment of 13th month pay computed on the basis of the salesmen’s fixed or guaranteed wages plus
commissions.
Petitioner corporation refused the union’s request, but stated it would respect an opinion from the
MOLE. On 17 November 1987, acting upon a request for opinion submitted by respondent union,
Director Augusto G. Sanchez of the Bureau of Working Conditions, MOLE, rendered an opinion to
respondent union declaring applicable the provisions of Explanatory Bulletin No. 86-12, Item No. 5 (a):

. . . . Since the salesmen of Philippine Duplicators are receiving a fixed basic wage plus commission on
sales and not purely on commission basis, they are entitled to receive 13th month pay provided they
worked at least one (1) month during the calendar year. May we add at this point that in computing
such 13th month pay, the total commissions of said salesmen for the calendar year shall be divided by
twelve (12). (Emphasis supplied)

Notwithstanding Director Sanchez’ opinion or ruling, petitioner refused to pay the claims of its salesmen
for 13th month pay computed on the basis of both fixed wage plus sales commissions.

Issue: WON sales commission is included in the coverage of basic salary for purposes of computing 13th
month pay.

Held:

Decision (1993)

In the first place, Article 97 (f) of the Labor Code defines the term “wage” (which is equivalent to
“salary,” as used in P.D. No. 851 and Memorandum Order No. 28) in the following terms:

(f) “Wage“ paid to any employee shall mean the remuneration or earnings, however designated,
capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, or
commission basis, or other method of calculating the same, which is payable by an employer to an
employee under a written or unwritten contract of employment for work done or to be done, or for
services rendered or to be rendered, and includes the fair and reasonable value, as determined by the
Secretary of Labor, of board, lodging, or other facilities customarily furnished by the employer to the
employee. “Fair and reasonable value” shall not include any profit to the employer or to any person
affiliated with the employer. (Emphasis supplied)

In the instant case, there is no question that the sales commissions earned by salesmen who make or
close a sale of duplicating machines distributed by petitioner corporation constitute part of the
compensation or remuneration paid to salesmen for serving as salesmen, and hence as part of the
“wage” or “salary” of petitioner’s salesmen. Indeed, it appears that petitioner pays its salesmen a small
fixed or guaranteed wage; the greater part of the salesmen’s wages or salaries being composed of the
sales or incentive commissions earned on actual sales closed by them. No doubt this particular salary
structure was intended for the benefit of petitioner corporation, on the apparent assumption that
thereby its salesmen would be moved to greater enterprise and diligence and close more sales in the
expectation of increasing their sales commissions. This, however, does not detract from the character of
such commissions as part of the salary or wage paid to each of its salesmen for rendering services to
petitioner corporation.

Petition and MR dismissed

Resolution (1995)

In Boie-Takeda the so-called commissions “paid to or received by medical representatives of Boie-

Takeda Chemicals or by the rank and file employees of Philippine Fuji Xerox Co.,” were excluded from
the term “basic salary” because these were paid to the medical representatives and rank-and-file
employees as “productivity bonuses.” The Second Division characterized these payments as additional
monetary benefits not properly included in the term “basic salary” in computing their 13th month pay.
As a rule a bonus is an amount granted and paid to an employee for his industry loyalty which
contributed to the success of the employer’s business and made possible the realization of profits. It is
an act of generosityof the employer for which the employee ought to be thankful and grateful. It is also
granted by an enlightened employer to spur the employee to greater efforts for the success of the
business and realization of bigger profits. From the legal point of view a bonus is not and mandable and
enforceable obligation. It is so when It is made part of the wage or salary or compensation.

2nd MR dismissed.

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Phil alliance corp v CA

Facts: Petitioner is a domestic corporation engaged in the business of manufacturing refrigerators,

freezers and washing machines. Respondent United Philacor Workers Union-NAFLU is the duly elected
collective bargaining representative of the rank-and-file employees of petitioner.

During the collective bargaining negotiations between petitioner and respondent union in 1997,
petitioner offered the amount of P4, 000.00 to each employee as an “early conclusion bonus”. Petitioner
claims that this bonus was promised as a unilateral incentive for the speeding up of negotiations
between the parties and to encourage respondent union to exert their best efforts to conclude a CBA.
Upon conclusion of the CBA negotiations, petitioner accordingly gave this early signing bonus.
In view of the expiration of this CBA, respondent union sent notice to petitioner of its desire to
negotiate a new CBA. Petitioner and respondent union began their negotiations. On October 22, 1999,
after eleven meetings, respondent union expressed dissatisfaction at the outcome of the negotiations
and declared a deadlock. A few days later, on October 26, 1999, respondent union filed a Notice of
Strike with the NCMB, Region IV in Calamba, Laguna, due to the bargaining deadlock.

The conciliation meetings started with eighteen unresolved items between petitioner and respondent
union. At the meeting, respondent union accepted petitioner’s proposals on fourteen items, leaving the
following items unresolved: wages, rice subsidy, signing, and retroactive bonus.

Petitioner and respondent union failed to arrive at an agreement concerning these four remaining
items. On January 2000, respondent union went on strike at the petitioner’s plant. The strike lasted for
eleven days and resulted in the stoppage of manufacturing operations as well as losses for petitioner,
which constrained it to file a petition before the Department of Labor and Employment. Labor Secretary
assumed jurisdiction over the dispute and, on January 2000, ordered the striking workers to return to
work within twenty-four hours from notice and directed petitioner to accept back the said employees. It
rendered decision fixing the amount of wage increase and directed to conclude a CBA to include the
items granted in the conference. Petitioner contested on the awarding of signing bonus.

Issue: Whether the signing bonus is covered under the maintenance of existing benefits.

Ruling: The payment of signing bonus is not covered under the existing benefits. The Court has
consistently ruled that a bonus is not a demandable and enforceable obligation. True, it may
nevertheless be granted on equitable considerations as when the giving of such bonus has been the
company’s long and regular practice.

To be considered a “regular practice,” however, the giving of the bonus should have been done over a
long period of time, and must be shown to have been consistent and deliberate. The test or rationale of
this rule on long practice requires an indubitable showing that the employer agreed to continue giving
the benefits knowing fully well that said employees are not covered by the law requiring payment
thereof.

Respondent does not contest the fact that petitioner initially offered a signing bonus only during the
previous CBA negotiation. Previous to that, there is no evidence on record that petitioner ever offered
the same or that the parties included a signing bonus among the items to be resolved in the CBA
negotiation. Hence, the giving of such bonus cannot be deemed as an established practice considering
that the same was given only once, that is, during the 1997 CBA negotiation.
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American wire and cable daily rated employees v American Wire and cable co

FACTS:American Wire and Cable Co., Inc., is a corporation engaged in the manufacture of wires and
cables. There are two unions in this company, the American Wire andCable Monthly-Rated Employees
Union and the American Wire and Cable Daily-Rated Employees. An original action was filed before the
NCMB of the Departmentof Labor and Employment (DOLE) by the two unions for voluntary arbitration.
Thepetitioner submits that the withdrawal of the private respondent of the 35%premium pay for
selected days during the Holy Week and Christmas season, theholding of the Christmas Party and its
incidental benefits, and the giving of serviceawards, which they have long enjoyed, violated Article 100
of the Labor Code.A decision was rendered by the Voluntary Arbitrator in favor of the
privaterespondent.On appeal, CA affirmed and upheld the Arbitrator’s decision.

ISSUE: Whether or not private respondent is guilty of violating Article 100 of the LaborCode, as
amended, when the benefits/entitlements given to the members of petitioner union were withdrawn.

HELD: The Court ruled that respondent is not guilty of violating Art. 100 of the Labor Code.

ART. 100. PROHIBITION AGAINST ELIMINATION OR DIMINUTION OF BENEFITS. –Nothing in this Book
shall be construed to eliminate or in any way diminishsupplements, or other employee benefits being
enjoyed at the time of promulgationof this Code.

The benefits and entitlements mentioned in the instant case are all considered bonuses which were
given by the private respondent out of its generosity andmunificence. A bonus is an amount granted and
paid to an employee for his industry and loyaltywhich contributed to the success of the employer’s
business and made possible therealization of profits. The granting of a bonus is a management
prerogative,something given in addition to what is ordinarily received by or strictly due therecipient.
Thus, a bonus is not a demandable and enforceable obligation, exceptwhen it is made part of the wage,
salary or compensation of the employee.

For a bonus to be enforceable, it must have been promised by the employer andexpressly agreed upon
by the parties or it must have had a fixed amount and had been a long and regular practice on the part
of the employer. The assailed benefitswere never subjects of any agreement between the union and the
company. It wasnever incorporated in the CBA. To be considered a “regular practice,” the giving of the
bonus should have beendone over a long period of time, and must be shown to have been consistent
anddeliberate. The downtrend in the grant of these two bonuses over the yearsdemonstrates that there
is nothing consistent about it. To hold that an employer should be forced to distribute bonuses which it
grantedout of kindness is to penalize him for his past generosity.
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Jolos Kiddie Carts v Caballa

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Phil Assoc v Drilon

FACTS:

Phil association of Service Exporters, Inc., is engaged principally in the recruitment of Filipino workers,
male and female of overseas employment. It challenges the constitutional validity of Dept. Order No. 1
(1998) of DOLE entitled “Guidelines Governing the Temporary Suspension of Deployment of Filipino
Domestic and Household Workers.” It claims that such order is a discrimination against males and
females. The Order does not apply to all Filipino workers but only to domestic helpers and females with
similar skills, and that it is in violation of the right to travel, it also being an invalid exercise of the
lawmaking power. Further, PASEI invokes Sec 3 of Art 13 of the Constitution, providing for worker
participation in policy and decision-making processes affecting their rights and benefits as may be
provided by law. Thereafter the Solicitor General on behalf of DOLE submitting to the validity of the
challenged guidelines involving the police power of the State and informed the court that the
respondent have lifted the deployment ban in some states where there exists bilateral agreement with
the Philippines and existing mechanism providing for sufficient safeguards to ensure the welfare and
protection of the Filipino workers.

ISSUE:

Whether or not D.O. No. 1 of DOLE is constitutional as it is an exercise of police power.

RULING:

“[Police power] has been defined as the "state authority to enact legislation that may interfere with
personal liberty or property in order to promote the general welfare." As defined, it consists of (1) an
imposition of restraint upon liberty or property, (2) in order to foster the common good. It is not capable
of an exact definition but has been, purposely, veiled in general terms to underscore its all-
comprehensive embrace.

“The petitioner has shown no satisfactory reason why the contested measure should be nullified. There
is no question that Department Order No. 1 applies only to "female contract workers," but it does not
thereby make an undue discrimination between the sexes. It is well-settled that "equality before the
law" under the Constitution does not import a perfect Identity of rights among all men and women. It
admits of classifications, provided that (1) such classifications rest on substantial distinctions; (2) they
are germane to the purposes of the law; (3) they are not confined to existing conditions; and (4) they
apply equally to all members of the same class.

The Court is satisfied that the classification made-the preference for female workers — rests on
substantial distinctions.

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Libres v NLRC

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Phil Aelous Automotive United Corp v NLRC

Q: Y was a company nurse for the Company Z. A memorandum was issued by the personnel manager of
Company Z to Y asking her to explain why no action should be taken against her for (1) throwing a
stapler at plant manager William Chua; (2) for losing the amount of P1,488 entrusted to her, (3) for
asking a co-employee to punch in her time card one morning when she was not there. She was then
placed on preventive suspension. Another memorandum was sent to her asking her to explain why she
failed to process the ATM applications of her co-employees. She submitted a written explanation as to
the loss of the P1,488 and the punching in of her time card. A third memorandum was sent to her
informing her of her termination from service for gross and habitual neglect of duties, serious
misconduct, and fraud or willful breach of trust. Y claims that her throwing of the stapler at plant
manager William Chua was because the latter had been making sexual advances on her since her first
year of employment and that when she would not accede to his requests, he threatened that he would
cause her termination from service. As to the other charges, she claimed that they were not done with
malice or bad faith. Was Y illegally dismissed, and if so, is she entitled to recover damages?

A: Yes. The grounds by which an employer may validly terminate the services of an employee must be
strictly construed. To constitute serious misconduct to justify dismissal, the acts must be done in
relation to the performance of her duties as would show her to be unfit to continue working for her
employer. The acts complained of did not pertain to her duties as a nurse neither did they constitute
serious misconduct. On the question of damages, although Y allowed four years to pass before coming
out with her employer’s sexual impositions; the time to do so admittedly varies depending upon the
needs, circumstances and emotional threshold of each person. It is clear that Y has suffered anxiety,
sleepless nights, besmirched reputation and social humiliation by reason of the act complained of. Thus,
she should be entitled to moral and exemplary damages for the oppressive manner with which
petitioner’s effected her dismissal and to serve as a warning to officers who take advantage of their
ascendancy over their employees. (Philippine Aeolus Automotive United Corporatoin v. NLRC, G.R. No.
124617, April 28, 2000)

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Renato s Gatbonton v NLRC

ACTS:

· November 1998: A civil engineering student of respondent Mapua Institute of Technology (MIT)
filed a letter-complaint against Renato S. Gatbonton, an associate professor of the Faculty of Civil
Engineering for unfair/unjust grading system, sexual harassment and conduct unbecoming of an
academician.

· Pending investigating, MIT, through its committee on Decorum and Investigation placed him under
a 30-day preventive suspension effective January 11, 1999.

o The committee believed that his continued stay during the investigation will affect his performance
as a faculty member, as well as the student’s learning and that the suspension will allow petitioner to
“prepare himself for the investigation and will prevent his influence to other members of the
community.

· He filed a complaint with the NLRC for illegal suspension, damages and attorney’s fees

· He questioned the validity of the administrative proceedings with the RTC in a petition for
certiorari but was terminated since MIT agreed to publish in the school organ the rules and regulations
implementing Republic Act No. 7877 (R.A. No. 7877) and disregard the previous administrative
proceedings

· Labor Arbiter: 30-day preventive suspension is illegal and directed MIT to pay his wages during the
said period

· NLRC: set aside the Labor Arbiter’s decision

· CA on special civil action for certiorari: affirming the NLRC

Issues:

Whether Mapua’s Rules and Regulations is effective as of January 11, 1999 when it was published only
on February 23, 1999 (persons)

W/N there is a valid justification for the 30-day preventive suspension under the Labor Code (labor)

Whether damages should be awarded

Held: Petition is partially granted. CA, NLRC set aside and Labors Arbiter reinstated

1. NO

· R.A. No. 7877 imposed the duty on educational or training institutions to "promulgate rules and
regulations in consultation with and jointly approved by the employees or students or trainees, through
their duly designated representatives, prescribing the procedures for the investigation of sexual
harassment cases and the administrative sanctions therefor

· Taňada vs. Tuvera:

o all statutes, including those of local application and private laws shall be published as a condition for
their effectivity is fixed by the legislative.(especially penal laws)

o Covered by this rule are presidential decrees and executive orders promulgated by the President in
the exercise of legislative powers whenever the same are validly delegated by the legislature or, at
present, directly conferred by the Constitution. Administrative rules and regulations must also be
published if their purpose is to enforce or implement existing law pursuant also to a valid delegation.

· publication must be in full or it is no publication at all since its purpose is to inform the public of
the contents of the laws

· Mapua Rules is one of those issuances that should be published for its effectivity, since its purpose
is to enforce and implement R.A. No. 7877, which is a law of general application
o Mapua Rules Section 3 Rule IV (Administrative Provisions) states that it shall take effect 15 days after
publication by the committee.

2. NO.

· Preventive suspension is a disciplinary measure for the protection of the company’s property
pending investigation of any alleged malfeasance or misfeasance committed by the employee. The
employer may place the worker concerned under preventive suspension if his continued employment
poses a serious and imminent threat to the life or property of the employer or of his co-workers.
However, when it is determined that there is no sufficient basis to justify an employee’s preventive
suspension, the latter is entitled to the payment of salaries during the time of preventive suspension

· Section 8, Rule XXIII, Book V of the Ominibus Rules, there is no valid justification

o does not show that evidence of petitioner’s guilt is strong and that the school head is morally
convinced that petitioner’s continued stay during the period of investigation constitutes a distraction to
the normal operations of the institution; or that petitioner poses a risk or danger to the life or property
of the other members of the educational community

3. No.

· While petitioner’s preventive suspension may have been unjustified, this does not automatically
mean that he is entitled to moral or other damages

o No showing of bad faith or in a wanton or fraudulent manner in preventively suspending petitioner