EDUARDO G.

EVIOTA, Petitioner,

vs.

THE HON. COURT OF APPEALS, THE HON. JOSE BAUTISTA, Presiding Judge of
Branch 136, Regional Trial Court of Makati, and STANDARD CHARTERED BANK,
Respondents

Facts:

Sometime on January 26, 1998, the respondent Standard Chartered Bank and
petitioner Eduardo G. Eviota executed a contract of employment under which the petitioner
was employed by the respondent bank as Compensation and Benefits Manager. After leading
the Bank to believe that he had come to stay, Eviota suddenly resigned his employment with
immediate effect to re-join his previous employer. His resignation, which did not comply with
the 30-day prior notice rule under the law and under the Employment.

Eviota made off with a computer diskette and other papers and documents containing
confidential information on employee compensation and other Bank matters, such as the
salary schedule of all Corporate and Institutional Banking officers and photocopies of
schedules of benefits provided expatriates being employed by the Bank. Eviota never complied
with the Bank’s demand that he reimburse the latter for the other expenses incurred on his
account, amounting

Issue:

WON the Labor Arbiter has jurisdiction over the case.

Ruling:

No. The Court holds that here, since the primary relief prayed for by the plaintiff is for
damages, grounded on the tortious manner by which the defendant terminated his
employment with the company, the same are recoverable under the applicable provision of
the Civil Code, the present controversy is removed from the jurisdiction of the Labor Arbiter
and brings in within the purview of the regular courts.

Not every controversy or money claim by an employee against the employer or vice-
versa is within the exclusive jurisdiction of the labor arbiter. A money claim by a worker
against the employer or vice-versa is within the exclusive jurisdiction of the labor arbiter only
if there is a "reasonable causal connection" between the claim asserted and employee-
employer relation. Absent such a link, the complaint will be cognizable by the regular courts
of justice. Actions between employees and employer where the employer-employee
relationship is merely incidental and the cause of action precedes from a different source of
obligation is within the exclusive jurisdiction of the regular court. We stated that the action
was for breach of a contractual obligation, which is intrinsically a civil dispute. In this case,
the private respondent’s first cause of action for damages is anchored on the petitioner’s
employment of deceit and of making the private respondent believe that he would fulfill his
obligation under the employment contract with assiduousness and earnestness. It is evident
that the causes of action of the private respondent against the petitioner do not involve the
provisions of the Labor Code of the Philippines and other labor laws but the New Civil Code.
 SAUDI ARABIAN AIRLINES (SAUDIA) AND BRENDA J. BETIA, Petitioners, v. MA. JOPETTE M.
REBESENCIO, MONTASSAH B. SACAR-ADIONG, ROUEN RUTH A. CRISTOBAL AND LORAINE S.
SCHNEIDER-CRUZ, Respondents.

Facts:

In this case, Respondents (complainants before the Labor Arbiter) were recruited and
hired by Saudia as Temporary Flight Attendants with the accreditation and approval of the
Philippine Overseas Employment Administration. After undergoing seminars required by the
Philippine Overseas Employment Administration for deployment overseas, as well as training
modules offered by Saudia (e.g., initial flight attendant/training course and transition
training), and after working as Temporary Flight Attendants, respondents became Permanent
Flight Attendants. They then entered into Cabin Attendant contracts with Saudia: Ma. Jopette
M. Rebesencio (Ma. Jopette) on May 16, 1990; Montassah B. Sacar-Adiong (Montassah) and
Rouen Ruth A. Cristobal (Rouen Ruth) on May 22, 1993; and Loraine Schneider-Cruz (Loraine)
on August 27, 1995.

Respondents continued their employment with Saudia until they were separated from
service on various dates in 2006. Respondents contended that the termination of their
employment was illegal. They alleged that the termination was made solely because they
were pregnant.

Saudia anchored its disapproval of respondents’ maternity leaves and demand for their
resignation on its “Unified Employment Contract for Female Cabin Attendants” (Unified
Contract). Under the Unified Contract, the employment of a Flight Attendant who becomes
pregnant is rendered void. It provides:

(H) Due to the essential nature of the Air Hostess functions to be physically fit on board
to provide various services required in normal or emergency cases on both
domestic/international flights beside her role in maintaining continuous safety and security of
passengers, and since she will not be able to maintain the required medical fitness while at
work in case of pregnancy, accordingly, if the Air Hostess becomes pregnant at any time
during the term of this contract, this shall render her employment contract as void and she
will be terminated due to lack of medical fitness.(Emphasis supplied)

On November 8, 2007, respondents filed a Complaint against Saudia and its officers
for illegal dismissal and for underpayment of salary, overtime pay, premium pay for holiday,
rest day, premium, service incentive leave pay, 13th month pay, separation pay, night shift
differentials, medical expense reimbursements, retirement benefits, illegal deduction, lay-
over expense and allowances, moral and exemplary damages, and attorney’s fees.

Issue:
The issue to be resolved in the instant case is whether or not there was an illegal
dismissal of the respondents?

Ruling:
Yes, the respondents were illegally dismissed.
 The initial issue here was whether or not the Philippine courts have jurisdiction over
the case. Petitioner Saudia states that the Philippine courts have no jurisdiction and that the
law that should be applied in the instant case is Saudi Arabia law. The Court stated that this
is incorrect. The Court has jurisdiction in this case.

The Court stated in the case;

Saudia asserts that stipulations set in the Cabin Attendant contracts require the
application of the laws of Saudi Arabia. It insists that the need to comply with these
stipulations calls into operation the doctrine of forum non conveniens and, in turn, makes it
necessary for Philippine tribunals to refrain from exercising jurisdiction. Forum non
conveniens, like the rules of forum shopping, litis pendentia, and res judicata, is a means of
addressing the problem of parallel litigation. While the rules of forum shopping, litis pendentia,
and res judicata are designed to address the problem of parallel litigation within a single
jurisdiction, forum non conveniens is a means devised to address parallel litigation arising in
multiple jurisdictions.

On the matter of pleading forum non conveniens, we state the rule, thus: Forum non
conveniens must not only be clearly pleaded as a ground for dismissal; it must be pleaded as
such at the earliest possible opportunity. Otherwise, it shall be deemed waived.

It further stated:
Forum non conveniens finds no application and does not operate to divest Philippine
tribunals of jurisdiction and to require the application of foreign law. Saudia invokes forum
non conveniens to supposedly effectuate the stipulations of the Cabin Attendant contracts
that require the application of the laws of Saudi Arabia.

xxx

So informed and animated, we emphasize the glaringly discriminatory nature of

Saudia’s policy. As argued by respondents, Saudia’s policy entails the termination of
employment of flight attendants who become pregnant. At the risk of stating the obvious,
pregnancy is an occurrence that pertains specifically to women. Saudia’s policy excludes from
and restricts employment on the basis of no other consideration but sex.

We do not lose sight of the reality that pregnancy does present physical limitations
that may render difficult the performance of functions associated with being a flight attendant.
Nevertheless, it would be the height of iniquity to view pregnancy as a disability so permanent
and immutable that it must entail the termination of one’s employment. It is clear to us that
any individual, regardless of gender, may be subject to exigencies that limit the performance
of functions. However, we fail to appreciate how pregnancy could be such an impairing
occurrence that it leaves no other recourse but the complete termination of the means through
which a woman earns a living.

Oddly enough, the petitioner Saudia themselves stated that the Saudi law does not
allow the termination of employment of women who take maternity leaves;

Consistent with lex loci intentionis, to the extent that it is proper and practicable (i.e.,
“to make an intelligent decision”), Philippine tribunals may apply the foreign law selected by
the parties. In fact, (albeit without meaning to make a pronouncement on the accuracy and
reliability of respondents’ citation) in this case, respondents themselves have made averments
as to the laws of Saudi Arabia. In their Comment, respondents write:

Under the Labor Laws of Saudi Arabia and the Philippines[,] it is illegal and unlawful
to terminate the employment of any woman by virtue of pregnancy. The law in Saudi Arabia
is even more harsh and strict [sic] in that no employer can terminate the employment of a
female worker or give her a warning of the same while on Maternity Leave, the specific
provision of Saudi Labor Laws on the matter is hereto quoted as follows: “An employer may
not terminate the employment of a female worker or give her a warning of the same while on
maternity leave.” (Article 155, Labor Law of the Kingdom of Saudi Arabia, Royal Decree No.
M/51.)

JOSE EMMANUEL P. GUILLERMO, Petitioner, v. CRISANTO P. USON, Respondent.

Facts:

On March 11, 1996, respondent Crisanto P. Uson (Uson) began his employment with
Royal Class Venture Phils., Inc. (Royal Class Venture) as an accounting clerk.3 Eventually, he
was promoted to the position of accounting supervisor, with a salary of Php13,000.00 a
month, until he was allegedly dismissed from employment on December 20, 2000. 4

On March 2, 2001, Uson filed with the Sub-Regional Arbitration . Branch No. 1, Dagupan City,
of the NLRC a Complaint for Illegal Dismissal, with prayers for backwages, reinstatement,
salaries and 13th month pay, moral and exemplary damages and attorney's fees against Royal
Class Venture.5

Royal Class Venture did not make an appearance in the case despite its receipt of summons.
Royal Class Venture, as the losing party, did not file an appeal of the decision.9 Consequently,
upon Uson's motion, a Writ of Execution10 dated February 15, 2002 was issued to implement
the Labor Arbiter's decision.

Issue:

Whether an officer of a corporation may be included as judgment obligor in a labor

case for the first time only after the decision of the Labor Arbiter had become final and
executory, and whether the twin doctrines of "piercing the veil of corporate fiction" and
personal liability of company officers in labor cases apply.

Ruling:

In the earlier labor cases of Claparols v. Court of Industrial Relations43 and A.C.
Ransom Labor Union-CCLU v. NLRC,44 persons who were not originally impleaded in the case
were, even during execution, held to be solidarity liable with the employer corporation for the
latter's unpaid obligations to complainant-employees. These included a newly-formed
corporation which was considered a mere conduit or alter ego of the originally impleaded
corporation, and/or the officers or stockholders of the latter corporation.
 The case at bar involves an apparent family corporation. As in those two cases, the
records of the present case bear allegations and evidence that Guillermo, the officer being
held liable, is the person responsible in the actual running of the company and for the
malicious and illegal dismissal of the complainant; he, likewise, was shown to have a role in
dissolving the original obligor company in an obvious "scheme to avoid liability" which
jurisprudence has always looked upon with a suspicious eye in order to protect the rights of
labor.

If the latter is found and the dispute does not meet the test of what qualities as an
intra-corporate controversy, then the case is a labor case cognizable by the NLRC and is not
within the jurisdiction of any other tribunal.73 In the case at bar, Uson's allegation was that
he was maliciously and illegally dismissed as an Accounting Supervisor by Guillermo, the
Company President and General Manager, an allegation that was not even disputed by the
latter nor by Royal Class Venture. It raised no intra-corporate relationship issues between
him and the corporation or Guillermo; neither did it raise any issue regarding the regulation
of the corporation. As correctly found by the appellate court, Uson's complaint and redress
sought were centered alone on his dismissal as an employee, and not upon any other
relationship he had with the company or with Guillermo. Thus, the matter is clearly a labor
dispute cognizable by the labor tribunals.chanrobleslaw

Mendoza vs. Officers of Manila Water Employees Union (MWEU)

FACTS:

Petitioner Mendoza was a member of MWEU, a DOLE-registered labor organization

consisting of rank-and-file employees within Manila Water Company (MWC) while the
respondents were MWEU officers.
In the April 2007 letter, Mendoza was warned of his failure to pay union dues (since he failed
to authorize the December 2006 checkoff). In the May 2007 letter, Mendoza was charged for
violation of CBL and was referred to MWEU grievance committee for investigation. On June
2007, Mendoza was, after notice and hearing, suspended for 30 days through a unanimous
approval due to the non-payment of union dues. Mendoza’s appeal for the convening of
General Membership Assembly had been repeatedly denied (either by denial or by ignoring
the appeal).
Meanwhile, MWEU scheduled an election of officers. Petitioner filed his certificate of
candidacy for Vice-President, but he was disqualified for not being a member in good standing
on account of his suspension. In addition, petitioner was charged with non-payment of union
dues for the third time was then on expelled from the union per unanimous approval of
Executive Board. His appeals to the General Membership Assembly w were again unheeded.
In 2008, during the freedom period and negotiations for a new CBA with MWC, Mendoza
joined another union, the Workers Association for Transparency, Empowerment and Reform,
All-Filipino Workers Confederation (WATER-AFWC) and was elected as union President. Other
MWEU members were inclined to join WATER-AFWC, but MWEU director Torres threatened
that they would not get benefits from the new CBA. The MWEU leadership submitted a
proposed CBA which contained provisions to the effect that (1) in the event of retrenchment,
non-MWEU members shall be removed first, and that upon the signing of the CBA, (2) only
MWEU members shall receive a signing bonus.
 October 2008, Mendoza filed a Complaint against respondents for ULP, damages, and
attorney’s fees and accused the respondents of (1) illegal termination (removal) from MWEU
in connection with the events relative to his non-payment of union dues; (2) unlawful
interference, coercion, and violation of the rights of MWC employees to self-organizationin
connection with the proposed CBA submitted by MWEU leadership, which petitioner claims
contained provisions that discriminated against non-MWEU members. Petitioner claims that
he was suspended and expelled from MWEU illegally as a result of the denial of his right to
appeal his case to the general membership assembly in accordance with the union’s CBL. On
the other hand, respondents claimed that LA has no jurisdiction, which is intra-union in nature
and BLR was the proper venue and that they were not guilty of ULP, discrimination, coercion
or restraint.

RULING OF THE LOWER COURTS:

LA: dismissed the complaint (still premature: exhaust first all available remedies before
resorting to compulsory arbitration) and referred back to Union for General Assembly.

NLRC: reversed decision of LA but still dismissed the complaint (lack of jurisdiction: intra-
union dispute)

CA: dismissed certiorari (lack of merit: no jurisdiction. Jurisdiction of BLR on union matters)

CONTENTIONS OF MENDOZA:

He was suspended and expelled from MWEU illegally as a result of the denial of his right to
appeal his case to the general membership assembly in accordance with the union’s
constitution and bylaws. Respondents restrained or coerced him in the exercise of his right as
a union memberin violation of paragraph “a,” Article 249 of the Labor Code, particularly, in
denying him the explanation as to whether there was observance of the proper procedure in
the increase of the membership dues from P100.00 to P200.00 per month.
he was denied the right to appeal his suspension and expulsionin accordance with the
provisions of the Union’s CBL.
respondents attempted to cause the management to discriminate against the members of
WATER-AFWC thru the proposed CBA.
CONTENTIONS OF RESPONDENTS:

Jurisdiction of BLR (intra/inter-union disputes)allegations regarding supposed coercion and

restraint relative to benefits in the proposed CBA do not constitute an actionable wrong
petitioner lost his right to appeal when he failed to petition to convene the general assembly
through the required signature of 30% of the union membership in good standing pursuant
to Article VI, Section 2(a) of MWEUÊs Constitution and By-Laws or by a petition of the majority
of the general membership in good standing under Article VI, Section 3.

ISSUE:

Whether respondents are guilty of ULP under Art. 249(a) and (b) of the Labor Code. – YES.
RULING + RATIO:

LOWER COURTS IGNORED ULP CHARGES (RE: DENIAL OF RIGHT TO APPEAL UNDER CBL)

Unfair labor practices may be committed both by the employer under Article 248 and by labor
organizations under Article 249 of the Labor Code. Petitioner contends that respondents
committed acts constituting unfair labor practices – which charge was particularly laid out in
his pleadings, but that the Labor Arbiter, the NLRC, and the CA ignored it and simply dismissed
his complaint on the ground that his causes of action were intra- or inter-union in nature.

MENDOZA WAS ILLEGALLY SUSPENDED AND EXPELLED = ULP (LA’s jurisdiction)

When an MWEU member is suspended, he is given the right to appeal such suspension within
three working days from the date of notice of said suspension, which appeal the MWEU
Executive Board is obligated to act upon by a simple majority vote. When the penalty imposed
is expulsion, the expelled member is given seven days from notice of said dismissal and/or
expulsion to appeal to the Executive Board, which is required to act by a simple majority vote
of its members. The Board’s decision shall then be approved/disapproved by a majority vote
of the general membership assembly in a meeting duly called for the purpose. (pertinent
provisions of CBL were Article VI, Sections 2(a) and(d), Section 3, and Article X, Sections 4
and 5)
The documentary evidence is clear that when Mendoza received the suspension letter, he
immediately and timely filed a written appeal. However, the Executive Boarddid not act
thereon. Then again, when he was charged for the 3rd time and expelled from MWEU, his
timely appeal was again not acted upon by said board.
Thus, contrary to respondents’ argument that petitioner lost his right to appeal when he failed
to petition to convene the general assembly through the required signature of 30% of the
union membership in good standing pursuant to Article VI, Section 2(a) of MWEU’s CBL or by
a petition of the majority of the general membership in good standing under Article VI, Section
3, this Court finds that petitioner was illegally suspended for the second time and thereafter
unlawfully expelled from MWEU due to respondents failure to act on his written appeals.
Because respondents did not act on his two appeals, petitioner was unceremoniously
suspended, disqualified and deprived of his right to run for the position of MWEU Vice
President in the September 14, 2007 election of officers, expelled from MWEU, and forced to
join another union, WATER-AFWC.
For these, respondents are guilty of ULP under Article 249(a) and (b) – that is, violation of
petitioner’s right to self-organization, unlawful discrimination, and illegal termination of his
union membership– which case falls within the original and exclusive jurisdiction of the Labor
Arbiters, in accordance with Article 217 of the Labor Code.

NATURE OF ULP (RELATES TO THE VIOLATION OF WORKER’S RIGHT TO ORGANIZE)

In essence, unfair labor practice relates to the commission of acts that transgress the workers’
right to organize. All the prohibited acts constituting unfair labor practice in essence relate to
the workers’ right to self- organization. The term unfair labor practice refers to that gamut of
offenses defined in the Labor Code which, at their core, violates the constitutional right of
workers and employees to self-organization.
Guaranteed to all employees or workers is the ‘right to self-organization and to form, join, or
assist labor organizations of their own choosing for purposes of collective bargaining.’ This is
made plain by no less than three provisions of the Labor Code of the Philippines. Article 243
of Labor Code provides for the coverage of employees’ right to self-organization.
Article 248(a) declares it to be an ULP for an employer, among others, to “interfere with,
restrain or coerce employees in the exercise of their right to self-organizaion”. Article 249(a)
makes it an unfair labor practice for a labor organization to “restrain or coerce employees in
the exercise of their rights to self-organization…”
The right of self-organization includes the right to organize or affiliate with a labor union or
determine which of two or more unions in an establishment to join, and to engage in concerted
activities with coworkers for purposes of collective bargaining through representatives of their
own choosing, or for their mutual aid and protection, i.e., the protection, promotion, or
enhancement of their rights and interests.

PEOPLE OF THE PHILIPPINES, Appellee,

vs.
TERESITA "TESSIE" LAOGO, Appellant.

Facts:

That in or about and during the months of May and June 2000, in the municipality of Bulacan,
province of Bulacan, Philippines, and within the jurisdiction of this Honorable Court, the above-named
accused, knowing that they are non-licensee or non-holder of authority from the Department of Labor
to recruit and/or place workers in employment either locally or overseas, conspiring, confederating
together and helping each other, did then and there wi[l]lfully, unlawfully and feloniously engage in
illegal recruitment, placement or deployment activities for a fee, which they received from complainants
Edith Bonifacio-Ulanday, Rogelio Enriquez y Buenavidez, Billy dela Cruz, Jr. y Fernandez, Dante
Lopez y Enriquez, Teodulo dela Cruz y Mendoza, Edwin Enriquez y Panganiban and Gary Bustillos y
de Guzman by recruiting and promising them job placement abroad, more particularly in Guam, which
did not materialize, without first having secured the required license or authority from the Department
of Labor and Employment.

Issue:

WON the Laogo is liable for illegal recruitment in large scale.

Ruling:

Yes. Recruitment and placement refers to the act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring workers, and includes referrals, contract services,
promising or advertising for employment, locally or abroad, whether for profit or not. When
a person or entity, in any manner, offers or promises for a fee employment to two or more
persons, that person or entity shall be deemed engaged in recruitment and placement.
 But to prove illegal recruitment, it must be shown that the accused, without being
duly authorized by law, gave complainants the distinct impression that he had the power or
ability to send them abroad for work, such that the latter were convinced to part with their
money in order to be employed.41 It is important that there must at least be a promise or
offer of an employment from the person posing as a recruiter, whether locally or abroad. 42

Here, both the trial court and the CA found that all the five complainants were promised
to be sent abroad by Susan and herein appellant 43 as cooks and assistant cooks. The follow
up transactions between appellant and her victims were done inside the said travel agency.
Moreover, all four receipts issued to the victims bear the name and logo of Laogo Travel
Consultancy,44 with two of the said receipts personally signed by appellant
herself.45 Indubitably, appellant and her co-accused acting together made complainants
believe that they were transacting with a legitimate recruitment agency and that Laogo Travel
Consultancy had the authority to recruit them and send them abroad for work when in truth
and in fact it had none as certified by the POEA. 46 Absent any showing that the trial court and
the CA overlooked or misappreciated certain significant facts and circumstances, which if
properly considered, would change the result, we are bound by said findings.

POSEIDON INTERNATIONAL MARITIME SERVICES, INC., Petitioner,

vs.
TITO R. TAMALA, FELIPE S. SAURIN, JR., ARTEMIO A. BO-OC and JOEL S.
FERNANDEZ, Respondents.

Facts:

In 2004, Poseidon hired the respondents, in behalf of Van Doorn, to man the fishing
vessels of Van Doorn and those of its partners – Dinko Tuna Farmers Pty. Ltd. (Dinko) and
Snappertuna Cv. Lda. (Snappertuna) - at the coastal and offshore area of Cape Verde Islands.
The respondents’ contracting dates, positions, vessel assignments, duration of the contract,
basic monthly salaries, guaranteed overtime pay and vacation leave pay, as reflected in their
approved contracts. On May 26, 2005, however, Poseidon and Van Doorn, with Goran of
Snappertuna and Dinko Lukin of Dinko, entered into another agreement (letter of acceptance)
reducing the previously agreed amount to 50% of the respondents’ unpaid salaries
(settlement pay) for the unexpired portion of their contract. 9 On May 28, 2005, the
respondents arrived in Manila. On June 10, 2005, the respondents received the settlement
pay under their letter of acceptance. The respondents then signed a waiver and
quitclaim10 and the corresponding cash vouchers.11

Issue:

At the core of this case are the validity of the respondents’ waivers and quitclaims and
the issue of whether these should bar their claim for unpaid salaries. At the completely legal
end is the question of whether Section 10 of R.A. No. 8042 applies to the respondents’ claim.

Ruling:

We are sufficiently convinced, based on the records, that Van Doorn’s termination of
the respondents’ employment arising from the cessation of its fishing operations complied
with the above requisites and is thus valid.
 In sum, since Poseidon ceased its fishing operations in the valid exercise of its
management prerogative, Section 10 of R.A. No. 8042 finds no application. Consequently, we
find that the CA erroneously imputed grave abuse of discretion on the part of the NLRC in not
applying Section 10 of R.A. No. 8042 and in awarding the respondents the unpaid portion of
their full salaries.

First, the respondents acknowledged in their various pleadings, as well as in the very
document denominated as "waiver and quitclaim," that they voluntarily signed the document
after receiving the agreed settlement pay.

Second, the settlement pay is reasonable under the circumstances, especially when
contrasted with the amounts to which they were respectively entitled to receive as termination
pay pursuant to Section 23 of the POEA-SEC and Article 283 of the Labor Code. The
comparison of these amounts is tabulated below:

Third, the contents of the waiver and quitclaim are clear, unequivocal and uncomplicated so
that the respondents could fully understand the import of what they were signing and of its
consequences.46 Nothing in the records shows that what they received was different from
what they signed for.

Fourth, the respondents are mature and intelligent individuals, with college degrees, and are
far from the naive and unlettered individuals they portrayed themselves to be.1âwphi1

Fifth, while the respondents contend that they were coerced and unduly influenced in their
decision to accept the settlement pay and to sign the waivers and quitclaims, the records of
the case do not support this claim. The respondents’ claims that they were in "dire need for
cash" and that they would not be paid anything if they would not sign do not constitute the
coercion nor qualify as the undue influence contemplated by law sufficient to invalidate a
waiver and quitclaim,47 particularly in the circumstances attendant in this case. The records
show that the respondents, along with their other fellow seafarers, served as each other’s
witnesses when they agreed and signed their respective waivers and quitclaims.

Sixth, the respondents’ voluntary and knowing conformity to the settlement pay was proved
not only by the waiver and quitclaim, but by the letters of acceptance and the vouchers
evidencing payment. With these documents on record, the burden shifts to the respondents
to prove coercion and undue influence other than through their bare self-serving claims. No
such evidence appeared on record at any stage of the proceedings.

LEO V. MAGO AND LEILANIE E. COLOBONG, Petitioners, v. SUN POWER

MANUFACTURING LIMITED, Respondent.

Facts:

The petitioners are former employees of Jobcrest, a corporation duly organized under
existing laws of the Philippines, engaged in the business of contracting management
consultancy and services.6 Jobcrest was licensed by the Department of Labor and Employment
(DOLE) through Certificate of Registration No. NCR-MUNTA-64209-0910-087-R.7 During the
time material to this case, the petitioners' co-habited together.
 It was alleged that sometime in October 2011, Sunpower conducted an operational
alignment, which affected some of the services supplied by Jobcrest. Sunpower decided to
terminate the Coinstacking/Material Handling segment and the Visual Inspection
segment.14 Meanwhile, Leo and Leilanie were respectively on paternity and maternity leave
because Leilanie was due to give birth to their common child.

Instead of complying with Jobcrest's directives, Leo and Leilanie filed a complaint for
illegal dismissal and regularization on December 15, 2011, with the NLRC Regional Arbitration
Branch No. IV. Leo alleged that he was dismissed on October 30, 2011, while Leilanie alleged
that she was dismissed from employment on December 4, 2011. 21 Despite the filing of the
complaint, Leilanie returned to Jobcrest on December 16, 2011, where she was served with
a similar "Notice of Admin Charge/Explanation Slip," requiring her to explain why she failed
to disclose her co-habitation status with Leo.

Issue:

WON the petitioners are regular employees of Sunpower.

Ruling:

No.

Jobcrest has substantial capital.

Evidently, Jobcrest had substantial capital to perform the business process services it
provided Sunpower. It has its own office, to which the petitioners admittedly reported to,
possessed numerous assets for the conduct of its business, and even continuously earned
profit as a result.75 The Court can therefore reasonably conclude from Jobcrest's financial
statements that it carried its own business independent from and distinctly outside the
control of its principals.

Suncrest does not control the manner by which the petitioners accomplished their
work.

The "right to control" shall refer to the right reserved to the person for whom the
services of the contractual workers are performed, to determine not only the end to be
achieved, but also the manner and means to be used in reaching that end.

Upon review of the records, the Court finds that the evidence clearly points to Jobcrest
as the entity that exercised control over the petitioners' work with Sunpower. Upon the
petitioners' assignment to Sunpower, Jobcrest conducted a training and certification program,
during which time, the petitioners reported directly to the designated Jobcrest trainer. 88 The
affidavit of Jobcrest's Operations Manager, Kathy T. Morales (Kathy), states that operational
control over Jobcrest employees was exercised to make sure that they conform to the quantity
and time specifications of the service agreements with Jobcrest's clients. She narrated that
manager and shift supervisors were assigned to the premises of Sunpower, with the task to
oversee the accomplishment of the target volume of work. She also mentioned that there is
administrative control over Jobcrest employees because they monitor the employees'
attendance and punctuality, and the employees' observance of other rules and regulations.
The petitioners were regular employees of Jobcrest.

The four-fold test is the established standard for determining the existence of an
employer-employee relationship:98 (a) the selection and engagement of the employee; (b)
the payment of wages; (c) the power of dismissal; and (d) the power of control over the
employee's conduct. Of the four elements, the power of control is the most
important.99 Having found that Jobcrest exercised control over the petitioners' work, the
Court is constrained to determine whether the petitioners were regular employees of
Jobcrest by virtue of the three other elements of the four-fold test.

The petitioners themselves admit that they were hired by Jobcrest.100 In their
subsequent engagement to Sunpower, it was Jobcrest that selected and trained the
petitioners.101 Despite their assignment to Sunpower, Jobcrest paid the petitioners' wages,
including their contributions to the Social Security System (SSS), Philippine Health Insurance
Corporation (Philhealth), and Home Development Mutual Fund (HDMF, also known as Pag-
IBIG).102 The power to discipline the petitioners was also retained by Jobcrest, as evidenced
by the "Notice of Admin Charge/Explanation Slip" furnished the petitioners through Jobcrest's
Human Resource department.

PHILIPPINE GEOTHERMAL, INC. EMPLOYEES UNION (PGIEU), Petitioner, v. CHEVRON

GEOTHERMAL PHILS. HOLDINGS, INC., Respondent.

Facts:

Petitioner is a legitimate labor organization and the certified bargaining agent of the
rank-and-file employees of Chevron Geothermal Phils. Holdings, Inc. (respondent). On July
31, 2008, the petitioner and respondent formally executed a Collective Bargaining
Agreement (CBA) which was made effective for the period from November 1, 2007 until
October 31, 2012. Under Article VII, Section 1 thereof, there is a stipulation governing
salary increases of the respondent's rank-and-file employee. On October 6, 2009, a letter
dated September 20, 2009 was sent by the petitioner's President to respondent expressing,
on behalf of its members, the concern that the aforesaid CBA provision and implementing
rules were not being implemented properly pursuant to the guidelines and that, if not
addressed, might result to a salary distortion among union members.

Finding the explanation not satisfactory, petitioner, with respondent's approval,

referred the subject dispute to the Voluntary Arbitration of the National Conciliation and
Mediation Board (NCMB). It averred that respondent breached their CBA provision on worker's
wage increase because it granted salary increase even to probationary employees in
contravention of the express mandate of that particular CBA article and implementing
guidelines that salary increases were to be given only to regular employees.

Issue:

WHETHER OR NOT THE CA GRAVELY ERRED IN HOLDING THAT RESPONDENT DID

NOT VIOLATE THE CBA IN GRANTING WAGE INCREASE OF P1,500.00 TO LANAO AND
CORDOVALES AT A TIME WHEN THEY HAD NOT YET ATTAINED REGULAR STATUS

Ruling:
 Clearly then, the increase in the salaries of Lanao and Cordovales was not pursuant
to the wage increase agreed upon in CBA 2007-2012 rather it was the result of the increase
in hiring rates at the time they were hired.

Management prerogative gives an employer freedom to regulate according to their

discretion and best judgment, all aspects of employment including work assignment, working
methods, the processes to be followed, working regulations, transfer of employees, work
supervision, lay-off of workers and the discipline, dismissal and recall of workers. 26 This right
is tempered only by these limitations: that it must be exercised in good faith and with due
regard to the rights of the employees.

It is the prerogative of management to regulate, according to its discretion and

judgment all aspects of employment. This flows from the established rule that labor law does
not authorize the substitution of the judgment of the employer in the conduct of its business.
Such management prerogative may be availed of without fear of any liability so long as it 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 agreements
and are not exercised in a malicious, harsh, oppressive, vindictive or wanton manner or out
of malice or spite.

MARILYN B. ASENTISTA, Petitioner, v. JUPP & COMPANY, INC., AND/OR MR.

JOSEPH V. ASCUTIA, Respondents.

Facts:

Asentista was employed by JUPP as sales secretary on April 16, 2007. On March 14,
2008, she became a regular employee of the company as a sales assistant and was later
appointed in July 2010 as a sales agent of JUPP for its Northern Mindanao area. As a sales
agent, Asentista became entitled to a sales commission of two percent for every attained
monthly quota. However, despite reaching her monthly quota, JUPP failed to give Asentista
her earned sales commission despite repeated requests.5

Meanwhile in 2011, JUPP, through its Administrative and Finance Officer Malou Ramiro, issued
a new Toyota Avanza vehicle to Asentista in view of her sales performance in the Cagayan De
Oro area. The ownership of the car, however, remains with the company. Notwithstanding
lack of agreement, JUPP deducted car plan participation payment amounting to P113,000.00
and one year rental payment of P68,721.36 from her unpaid sales commission. On February
4, 2013, Asentista tendered her resignation effective February 28, 2013 and returned the
Avanza vehicle to JUPP through Emmanuel P. Pabon.7 Thereafter, she filed a claim for unpaid
commission and refund for car plan deduction based on the computation. As a result of the
respondents' incessant refusal to pay, Asentista filed a complaint against JUPP and Ascutia
before the NLRC Regional Arbitration Branch No. 10, Cagayan de Oro City for non-payment
for sales commission.

Issue:
 WON the petitioner is entitled for the said commission and refund for car plan
participation and amortization payment.

Ruling:

In Toyota Pasig, Inc. v. De Peralta[23 citing Iran v. NLRC,24 the Court affirmed the
inclusion of sales commission as part of a salesman's remuneration for services rendered to
the company. In explaining the wisdom behind the inclusion, it was held that:

This definition explicitly includes commissions as part of wages. While commissions

are, indeed, incentives or forms of encouragement to inspire employees to put a little more
industry on the jobs particularly assigned to them, still these commissions are direct
remunerations for services rendered. In fact, commissions have been defined as the
recompense, compensation or reward of an agent, salesman, executor, trustee, receiver,
factor, broker or bailee, when the same is calculated as a percentage on the amount of his
transactions or on the profit to the principal. The nature of the work of a salesman and the
reason for such type of remuneration for services rendered demonstrate clearly that
commissions are part of a salesman's wage or salary.

It is a settled labor doctrine that in cases involving non-payment of monetary claims

of employees, the employer has the burden of proving that the employees did receive their
wages and benefits and that the same were paid in accordance with law.[26 As elucidated
in De Guzman v. NLRC, et al.:27

It is settled that once the employee has set out with particularity in his complaint,
position paper, affidavits and other documents the labor standard benefits he is entitled to,
and which he alleged that the employer failed to pay him, it becomes the employer's burden
to prove that it has paid these money claims. One who pleads payment has the burden of
proving it, and even where the employees 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 case of Locsin v. Mekeni32 is instructive:

In the absence of specific terms and conditions governing a car plan agreement
between the employer and employee, the former may not retain the installment payments
made by the latter on the car plan and treat them as rents for the use of the service vehicle,
in the event that the employee ceases his employment and is unable to complete the
installment payments on the vehicle. The underlying reason is that the service vehicle was
precisely used in the former's business; any personal benefit obtained by the employee from
its use is merely incidental.

Any benefit or privilege enjoyed by Asentista from using the service vehicle was merely
incidental and insignificant, because for the most part the vehicle was under the respondents'
control and supervision. Given the high monthly quota requirement imposed upon Asentista
to generate sales for the company, the service vehicle given to her was an absolute necessity.
In truth, the respondents were the ones reaping the full benefits of the vehicle assigned to
Asentista in the performance of her function.
 SLL INTERNATIONAL CABLES SPECIALIST and SONNY L. LAGON, Petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION, 4th DIVISION, ROLDAN LOPEZ,
EDGARDO ZUÑIGA and DANILO CAÑETE, Respondents.

Facts:

Sometime in 1996, and January 1997, private respondents Roldan Lopez (Lopez for
brevity) and Danilo Cañete (Cañete for brevity), and Edgardo Zuñiga (Zuñiga for brevity)
respectively, were hired by petitioner Lagon as apprentice or trainee cable/lineman. The three
were paid the full minimum wage and other benefits but since they were only trainees, they
did not report for work regularly but came in as substitutes to the regular workers or in
undertakings that needed extra workers to expedite completion of work. After their training,
Zuñiga, Cañete and Lopez were engaged as project employees by the petitioners in their
Islacom project in Bohol. Private respondents started on March 15, 1997 until December
1997. Upon the completion of their project, their employment was also terminated. Private
respondents received the amount of ₱145.00, the minimum prescribed daily wage for Region
VII. In July 1997, the amount of ₱145 was increased to ₱150.00 by the Regional Wage Board
(RWB) and in October of the same year, the latter was increased to ₱155.00. Sometime in
March 1998, Zuñiga and Cañete were engaged again by Lagon as project employees for its
PLDT Antipolo, Rizal project, which ended sometime in (sic) the late September 1998. As a
consequence, Zuñiga and Cañete’s employment was terminated. For this project, Zuñiga and
Cañete received only the wage of ₱145.00 daily. The minimum prescribed wage for Rizal at
that time was ₱160.00.

For reasons of delay on the delivery of imported materials from Furukawa Corporation,
the Camarin project was not completed on the scheduled date of completion. Face[d] with
economic problem[s], Lagon was constrained to cut down the overtime work of its
worker[s][,] including private respondents. Thus, when requested by private respondents on
February 28, 2000 to work overtime, Lagon refused and told private respondents that if they
insist, they would have to go home at their own expense and that they would not be given
anymore time nor allowed to stay in the quarters.

Issue:

WON that the value of the facilities that the private respondents enjoyed should be included
in the computation of the "wages" received by them.

Ruling:

No. As a general rule, on payment of wages, a party who alleges payment as a defense
has the burden of proving it.17 Specifically with respect to labor cases, the burden of proving
payment of monetary claims rests on the employer, the rationale being that the pertinent
personnel files, payrolls, records, remittances and other similar documents — which will show
that overtime, differentials, service incentive leave and other claims of workers have been
paid — are not in the possession of the worker but in the custody and absolute control of the
employer.
 Moreover, before the value of facilities can be deducted from the employees’ wages,
the following requisites must all be attendant: first, proof must be shown that such facilities
are customarily furnished by the trade; second, the provision of deductible facilities must be
voluntarily accepted in writing by the employee; and finally, facilities must be charged at
reasonable value.20 Mere availment is not sufficient to allow deductions from employees’
wages.21

These requirements, however, have not been met in this case. SLL failed to present
any company policy or guideline showing that provisions for meals and lodging were part of
the employee’s salaries. It also failed to provide proof of the employees’ written authorization,
much less show how they arrived at their valuations. At any rate, it is not even clear whether
private respondents actually enjoyed said facilities.

OUR HAUS REALTY DEVELOPMENT CORPORATION, Petitioner,

vs.
ALEXANDER PARIAN, JAY C. ERINCO, ALEXANDER CANLAS, BERNARD TENEDERO
and JERRY SABULAO, Respondents

Facts:

Respondents Alexander Parian, Jay Erinco, Alexander Canlas, Jerry Sabulao and
Bernardo Tenederowere all laborers working for petitioner Our Haus Realty Development
Corporation (Our Haus), a company engaged in the construction business. Sometime in May
2010, Our Haus experienced financial distress. To alleviate its condition, Our Haus suspended
some of its construction projects and asked the affected workers, including the respondents,
to take vacation leaves.8

Eventually, the respondents were asked to report back to work but instead of doing
so, they filed with the LA a complaint for underpayment of their daily wages. They claimed
that except for respondent Bernardo N. Tenedero, their wages were below the minimum rates
prescribed in the following wage orders from 2007 to 2010.

Issue:

WON deduction and charging are different terms to allow deduction in its employees
salary.

Ruling:

No substantial distinction between deducting and charging a facility’s value from the
employee’s wage; the legal requirements for creditability apply to both

To justify its non-compliance with the requirements for the deductibility of a facility,
Our Haus asks us to believe that there is a substantial distinction between the deduction and
the charging of a facility’s value to the wages. Our Haus explains that in deduction, the amount
of the wage (which may already be below the minimum) would still be lessened by the facility’s
value, thus needing the employee’s consent. On the other hand, in charging, there is no
reduction of the employee’s wage since the facility’s value will just be theoretically added to
the wage for purposes of complying with the minimum wage requirement. 39

Our Haus’ argument is a vain attempt to circumvent the minimum wage law by trying
to create a distinction where none exists. As part of the project cost that construction
companies already charge to their clients, the value of the housing of their workers cannot be
charged again to their employees’ salaries. Our Haus cannot pass the burden of the OSH costs
of its construction projects to its employees by deducting it as facilities. This is Our Haus’
obligation under the law.

The purpose test in jurisprudence

Ultimately, the real difference lies not on the kind of the benefit but on the purpose
why it was given by the employer. If it is primarily for the employee’s gain, then the benefit
is a facility; if its provision is mainly for the employer’s advantage, then it is a supplement.
Again, this is to ensure that employees are protected in circumstances where the employer
designates a benefit as deductible from the wages even though it clearly works to the
employer’s greater convenience or advantage.

Under the purpose test, substantial consideration must be given to the nature of the
employer’s business inrelation to the character or type of work performed by the employees
involved.

Based on these considerations, we conclude that even under the purpose test, the
subsidized meals and free lodging provided by Our Haus are actually supplements. Although
they also work to benefit the respondents, an analysis of the nature of these benefits in
relation to Our Haus’ business shows that they were given primarily for Our Haus’ greater
convenience and advantage. If weighed on a scale, the balance tilts more towards Our Haus’
side. Accordingly, their values cannot be considered in computing the total amount of the
respondents’ wages. Under the circumstances, the dailywages paid to the respondents are
clearly below the prescribed minimum wage rates in the years 2007-2010.

RFM CORPORATION-FLOUR DIVISION and SFI FEEDS DIVISION, Petitioner,

vs.
KASAPIAN NG MANGGA-GAWANG PINAGKAISA-RFM (KAMPI-NAFLU-KMU) and SANDIGAN
AT UGNAYAN NG MANGGAGAWANG PINAGKAISA-SFI (SUMAPI-NAFLU-KMU) Respondents.

If the terms of a CBA are clear and have no doubt upon the intention of the contracting
parties, as in the herein questioned provision, the literal meaning thereof shall prevail. That
is settled.5 As such, the daily-paid employees must be paid their regular salaries on the
holidays which are so declared by the national government, regardless of whether they fall
on rest days.

Holiday pay is a legislated benefit enacted as part of the Constitutional imperative that
the State shall afford protection to labor. Its purpose is not merely "to prevent diminution of
the monthly income of the workers on account of work interruptions. In other words, although
the worker is forced to take a rest, he earns what he should earn, that is, his holiday
pay."6 (Emphasis and underscoring supplied)
 The CBA is the law between the parties, hence, they are obliged to comply with its
provisions.7 Indeed, if petitioner and respondents intended the provision in question to cover
payment only during holidays falling on work or weekdays, it should have been so
incorporated therein.

Petitioner maintains, however, that the parties failed to foresee a situation where the
special holiday would fall on a rest day. The Court is not persuaded. The Labor Code
specifically enjoins that in case of doubt in the interpretation of any law or provision affecting
labor, it should be interpreted in favor of labor.8

Respondents having been compelled to litigate as a result of petitioner’s failure to

satisfy their valid claim, the Court deems it just and equitable to sustain the award of
attorney’s fees.

NATIONAL UNION OF WORKERS IN HOTEL RESTAURANT AND ALLIED INDUSTRIES

(NUWHRAIN-APL-IUF), PHILIPPINE PLAZA CHAPTER, Petitioner,
vs.
PHILIPPINE PLAZA HOLDINGS, INC., Respondent.

Facts:

The Union is the collective bargaining agent of the rank-and-file employees of

respondent Philippine Plaza Holdings, Inc. (PPHI). On February 25, 1999, the Union’s Service
Charge Committee informed the Union President, through an audit report (1st audit
report),8 of uncollected service charges for the last quarter of 1998 amounting to
₱2,952,467.61. Specifically, the audit report referred to the service charges from the following
items: (1) "Journal Vouchers;" (2) "Banquet Other Revenue;" and (3) "Staff and Promo." The
Union presented this audit report to the PPHI’s management during the February 26, 1999
Labor Management Cooperation Meeting (LMCM).9 The PPHI’s management responded that
the Hotel Financial Controller would need to verify the audit report.

Through a letter dated June 9, 1999,10 the PPHI admitted liability for ₱80,063.88 out
of the ₱2,952,467.61 thatthe Union claimed as uncollected service charges. The PPHI denied
the rest of the Union’s claims because: (1) they were exempted from the service charge being
revenues from "special promotions" (revenue from the Westin Gold Card sales) or "negotiated
contracts" (alleged revenue from the Maxi-Media contract); (2) the revenues did not belong
to the PPHI but to third-party suppliers; and (3) no revenue was realized from these
transactions as they were actually expenses incurred for the benefit of executives or by way
of good-will to clients and government officials.

When the parties failed to reachan agreement, the Union, on May 3, 2001, filed before
the LA (Regional Arbitration Branch of the NLRC) a complaint 14 for non-payment of specified
service charges. The Union additionally charged the PPHI with unfair labor practice (ULP)
under Article 248 of the Labor Code, i.e., for violation of their collective bargaining agreement.

Issue:

WON they are entitle for the service charges.

Ruling:

No. In addition, the Court’s jurisdiction in a Rule 45 petition for review on certiorari is
limited to resolving only questions of law. A question of law arises when the doubt or
controversy exists as to what law pertains to a particular set of facts; and a question of fact
arises when the doubt or controversy pertains to the truth or falsity of the alleged facts. 25

The present petition essentially raises the question – whether the Union may collect
from the PPHI, under the terms of the CBA, its share of the service charges. This is a clear
question of law that falls well within the Court’s power in a Rule 45 petition.

In granting the Union’s claim, the NLRC simply declared that the PPHI "has not shown
any proof that it paid or remitted what is due to the Union and its members" and concluded
that the specified entries/transactions were "service chargeable." This NLRC conclusion plainly
failed to appreciate that it involved only the alleged uncollected service charges from the
specified entries/transactions. The NLRC likewise, in the course of its ruling, did not point to
any evidence supporting its conclusion. Our consideration of the records taken under our
limited factual review power convinces us that these specified entries/transactions are indeed
not subject to a 10% service charge. We thus see no reason to disturb the CA’s findings on
these points. The PPHI did not violate Article 96 of the Labor Code when they refused the
Union’s claim for service charges on the specified entries/transactions

PEDRO CHAVEZ, petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION, SUPREME PACKAGING, INC. and
ALVIN LEE, Plant Manager, respondents

Facts:

The respondent company, Supreme Packaging, Inc., is in the business of

manufacturing cartons and other packaging materials for export and distribution. It engaged
the services of the petitioner, Pedro Chavez, as truck driver on October 25, 1984. As such,
the petitioner was tasked to deliver the respondent company’s products from its factory in
Mariveles, Bataan, to its various customers, mostly in Metro Manila. The respondent company
furnished the petitioner with a truck. Most of the petitioner’s delivery trips were made at
nighttime, commencing at 6:00 p.m. from Mariveles, and returning thereto in the afternoon
two or three days after. The deliveries were made in accordance with the routing slips issued
by respondent company indicating the order, time and urgency of delivery. Initially, the
petitioner was paid the sum of ₱350.00 per trip. This was later adjusted to ₱480.00 per trip
and, at the time of his alleged dismissal, the petitioner was receiving ₱900.00 per trip.

On February 20, 1995, the petitioner filed a complaint for regularization with the
Regional Arbitration Branch No. III of the NLRC in San Fernando, Pampanga. Before the case
could be heard, respondent company terminated the services of the petitioner. Consequently,
on May 25, 1995, the petitioner filed an amended complaint against the respondents for illegal
dismissal, unfair labor practice and non-payment of overtime pay, nightshift differential pay,
13th month pay, among others. The case was docketed as NLRC Case No. RAB-III-02-6181-
95.
The respondents, for their part, denied the existence of an employer-employee relationship
between the respondent company and the petitioner.

Issue:

THE COURT OF APPEALS COMMITTED A GRAVE ABUSE OF DISCRETION AMOUNTING

TO EXCESS OF JURISDICTION IN REVERSING ITS OWN FINDINGS THAT PETITIONER IS A
REGULAR EMPLOYEE AND IN HOLDING THAT THERE EXISTED NO EMPLOYER-EMPLOYEE
RELATIONSHIP BETWEEN PRIVATE RESPONDENT AND PETITIONER IN AS MUCH AS THE
"CONTROL TEST" WHICH IS CONSIDERED THE MOST ESSENTIAL CRITERION IN
DETERMINING THE EXISTENCE OF SAID RELATIONSHIP IS NOT PRESENT

Ruling:

No. The elements to determine the existence of an employment relationship are: (1)
the selection and engagement of the employee; (2) the payment of wages; (3) the power of
dismissal; and (4) the employer’s power to control the employee’s conduct. 11 The most
important element is the employer’s control of the employee’s conduct, not only as to the
result of the work to be done, but also as to the means and methods to accomplish it. 12 All
the four elements are present in this case.

First. Undeniably, it was the respondents who engaged the services of the petitioner without
the intervention of a third party.

Second. Wages are defined as "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 service rendered or to be rendered."13 That the petitioner was paid on a per trip
basis is not significant. This is merely a method of computing compensation and not a basis
for determining the existence or absence of employer-employee relationship. One may be
paid on the basis of results or time expended on the work, and may or may not acquire an
employment status, depending on whether the elements of an employer-employee
relationship are present or not.14 In this case, it cannot be gainsaid that the petitioner received
compensation from the respondent company for the services that he rendered to the latter.

Moreover, under the Rules Implementing the Labor Code, every employer is required to pay
his employees by means of payroll.15 The payroll should show, among other things, the
employee’s rate of pay, deductions made, and the amount actually paid to the employee.
Interestingly, the respondents did not present the payroll to support their claim that the
petitioner was not their employee, raising speculations whether this omission proves that its
presentation would be adverse to their case.16

Third. The respondents’ power to dismiss the petitioner was inherent in the fact that they
engaged the services of the petitioner as truck driver. They exercised this power by
terminating the petitioner’s services albeit in the guise of "severance of contractual relation"
due allegedly to the latter’s breach of his contractual obligation.

Fourth. As earlier opined, of the four elements of the employer-employee relationship, the
"control test" is the most important. Compared to an employee, an independent contractor is
one who carries on a distinct and independent business and undertakes to perform the job,
work, or service on its own account and under its own responsibility according to its own
manner and method, free from the control and direction of the principal in all matters
connected with the performance of the work except as to the results thereof.17 Hence, while
an independent contractor enjoys independence and freedom from the control and supervision
of his principal, an employee is subject to the employer’s power to control the means and
methods by which the employee’s work is to be performed and accomplished. 18

P.I. MANUFACTURING, INCORPORATED, petitioner,

vs.
P.I. MANUFACTURING SUPERVISORS AND FOREMAN ASSOCIATION and the
NATIONAL LABOR UNION, respondents.

Facts:

Petitioner P.I. Manufacturing, Incorporated is a domestic corporation engaged in the

manufacture and sale of household appliances. On the other hand, respondent P.I.
Manufacturing Supervisors and Foremen Association (PIMASUFA) is an organization of
petitioner’s supervisors and foremen, joined in this case by its federation, the National
Labor Union (NLU).

On January 26, 1989, respondents PIMASUFA and NLU filed a complaint with the
Arbitration Branch of the National Labor Relations Commission (NLRC), docketed as NLRC-
NCR Case No. 00-01-00584, charging petitioner with violation of R.A. No. 6640. 3 Respondents
attached to their complaint a numerical illustration of wage distortion resulting from the
implementation of R.A. No. 6640.

Issue:

WON there is wage distortion.

Ruling:

No. However, while we find the presence of wage distortions, we are convinced that
the same were cured or remedied when respondent PIMASUFA entered into the 1987 CBA
with petitioner after the effectivity of R.A. No. 6640. The 1987 CBA increased the monthly
salaries of the supervisors by P625.00 and the foremen, by P475.00, effective May 12,
1987. These increases re-established and broadened the gap, not only between the
supervisors and the foremen, but also between them and the rank-and-file employees.
Significantly, the 1987 CBA wage increases almost doubled that of the P10.00 increase
under R.A. No. 6640. The P625.00/month means P24.03 increase per day for the
supervisors, while the P475.00/month means P18.26 increase per day for the foremen.
These increases were to be observed every year, starting May 12, 1987 until July 26, 1989.
Clearly, the gap between the wage rates of the supervisors and those of the foremen was
inevitably re-established. It continued to broaden through the years.

At this juncture, it must be stressed that a CBA constitutes the law between the
parties when freely and voluntarily entered into.13 Here, it has not been shown that
respondent PIMASUFA was coerced or forced by petitioner to sign the 1987 CBA. All of its
thirteen (13) officers signed the CBA with the assistance of respondent NLU. They signed it
fully aware of the passage of R.A. No. 6640. The duty to bargain requires that the parties
deal with each other with open and fair minds. A sincere endeavor to overcome obstacles
and difficulties that may arise, so that employer-employee relations may be stabilized and
industrial strife eliminated, must be apparent.14 Respondents cannot invoke the beneficial
provisions of the 1987 CBA but disregard the concessions it voluntary extended to
petitioner. The goal of collective bargaining is the making of agreements that will stabilize
business conditions and fix fair standards of working conditions.15 Definitely, respondents’
posture contravenes this goal.

In fine, it must be emphasized that in the resolution of labor cases, this Court has
always been guided by the State policy enshrined in the Constitution that the rights of
workers and the promotion of their welfare shall be protected. However, consistent with
such policy, the Court cannot favor one party, be it labor or management, in arriving at a
just solution to a controversy if the party concerned has no valid support to its claim, like
respondents here.

NORKIS FREE AND INDEPENDENT WORKERS UNION, Petitioner,

vs.
NORKIS TRADING COMPANY, INC. Respondent.

Facts:

The instant case arose as a result of the issuance of Wage Order No. ROVII-06 by the
Regional Tripartite Wages and Productivity Board (RTWPB) increasing the minimum daily
wage by ₱10.00, effective October 1, 1998.

"Prior to said issuance, herein parties entered into a Collective Bargaining Agreement
(CBA) effective from August 1, 1994 to July 31, 1999. "In accordance with the Wage Order
and Section 2, Article XII of the CBA, [petitioner] demanded an across-the-board increase.
[Respondent], however, refused to implement the Wage Order, insisting that since it has been
paying its workers the new minimum wage of ₱165.00 even before the issuance of the
Wage Order, it cannot be made to comply with said Wage Order.

Issue:

The main issue is whether respondent violated the CBA in its refusal to grant its
employees an across-the-board increase as a result of the passage of Wage Order No. ROVII-
06. Also raised is the procedural issue relating to the propriety of the admission by the CA of
RTWPB’s letter-opinion, which was attached to respondent’s Supplemental Memorandum
submitted to that court on August 30, 2000, beyond the July 17, 2000 extended deadline.

Ruling:

No.

SECTION 2. Minimum Wage Law Amendment. In the event that a law is enacted increasing
minimum wage, an across-the-board increase shall be granted by the Company according to
the provisions of the law."
Interestingly, petitioner disregards altogether in its argument the qualifying phrase "according
to the provisions of the law" and merely focuses its attention on the "across-the-board
increase" clause. Given the entire sentence, it is clear that the above-quoted CBA provision
does not support the unyielding view of petitioner that the issuance of Wage Order No. ROVII-
06 entitles its members to an across-the-board increase, absolutely and without any
condition.

Stipulations in a contract must be read together,12 not in isolation from one another. When
the terms of its clauses are clear and leave no room for doubt as to the intention of the
contracting parties, it would not be necessary to interpret those terms, whose literal meanings
should prevail.

Parenthetically, there are two methods of adjusting the minimum wage. In Employers
Confederation of the Phils. v. National Wages and Productivity Commission,16 these were
identified as the "floor wage" and the "salary-ceiling" methods. The "floor wage" method
involves the fixing of a determinate amount to be added to the prevailing statutory minimum
wage rates. On the other hand, in the "salary-ceiling" method, the wage adjustment was to
be applied to employees receiving a certain denominated salary ceiling. In other words,
workers already being paid more than the existing minimum wage (up to a certain amount
stated in the Wage Order) are also to be given a wage increase.

ABDULJUAHID R. PIGCAULAN,* Petitioner,

vs.
SECURITY and CREDIT NVESTIGATION, INC. and/or RENE AMBY
REYES, Respondents.

Facts:

Canoy and Pigcaulan were both employed by SCII as security guards and were
assigned to SCII’s different clients. Subsequently, however, Canoy and Pigcaulan filed with
the Labor Arbiter separate complaints7 for underpayment of salaries and non-payment of
overtime, holiday, rest day, service incentive leave and 13th month pays. These complaints
were later on consolidated as they involved the same causes of action.

Canoy and Pigcaulan, in support of their claim, submitted their respective daily time
records reflecting the number of hours served and their wages for the same. They likewise
presented itemized lists of their claims for the corresponding periods served.

Issue:

WON the Honorable Court of Appeals erred when it dismissed the complaint on mere
alleged failure of the Labor Arbiter and the NLRC to observe the prescribed form of decision,
instead of remanding the case for reformation of the decision to include the desired detailed
computation.

Ruling:

The filing of a certificate of non-forum shopping is mandatory so much so that non-

compliance could only be tolerated by special circumstances and compelling reasons. 26 This
Court has held that when there are several petitioners, all of them must execute and sign the
certification against forum shopping; otherwise, those who did not sign will be dropped as
parties to the case.27 True, we held that in some cases, execution by only one of the petitioners
on behalf of the other petitioners constitutes substantial compliance with the rule on the filing
of a certificate of non-forum shopping on the ground of common interest or common cause
of action or defense.28 We, however, find that common interest is not present in the instant
petition. To recall, Canoy’s and Pigcaulan’s complaints were consolidated because they both
sought the same reliefs against the same respondents. This does not, however, mean that
they share a common interest or defense. The evidence required to substantiate their claims
may not be the same. A particular evidence which could sustain Canoy’s action may not
effectively serve as sufficient to support Pigcaulan’s claim.

There was no substantial evidence to support the grant of overtime pay.

We find that both the Labor Arbiter and the NLRC erred in this regard. The handwritten
itemized computations are self-serving, unreliable and unsubstantial evidence to sustain the
grant of salary differentials, particularly overtime pay. Unsigned and unauthenticated as they
are, there is no way of verifying the truth of the handwritten entries stated therein. Written
only in pieces of paper and solely prepared by Canoy and Pigcaulan, these representative
daily time records, as termed by the Labor Arbiter, can hardly be considered as competent
evidence to be used as basis to prove that the two were underpaid of their salaries. We find
nothing in the records which could substantially support Pigcaulan’s contention that he had
rendered service beyond eight hours to entitle him to overtime pay and during Sundays to
entitle him to restday pay. Hence, in the absence of any concrete proof that additional service
beyond the normal working hours and days had indeed been rendered, we cannot affirm the
grant of overtime pay to Pigcaulan.

Pigcaulan is entitled to holiday pay, service incentive leave pay and proportionate
13th month pay for year 2000.

However, with respect to the award for holiday pay, service incentive leave pay and
13th month pay, we affirm and rule that Pigcaulan is entitled to these benefits. Under the
Labor Code, Pigcaulan is entitled to his regular rate on holidays even if he does not
work.30 Likewise, express provision of the law entitles him to service incentive leave benefit
for he rendered service for more than a year already. Furthermore, under Presidential Decree
No. 851,31 he should be paid his 13th month pay. As employer, SCII has the burden of proving
that it has paid these benefits to its employees.32

SCII presented payroll listings and transmittal letters to the bank to show that Canoy
and Pigcaulan received their salaries as well as benefits which it claimed are already integrated
in the employees’ monthly salaries. However, the documents presented do not prove SCII’s
allegation. SCII failed to show any other concrete proof by means of records, pertinent files
or similar documents reflecting that the specific claims have been paid. With respect to 13th
month pay, SCII presented proof that this benefit was paid but only for the years 1998 and
1999. To repeat, the burden of proving payment of these monetary claims rests on SCII,
being the employer. It is a rule that one who pleads payment has the burden of proving it.
"Even when the plaintiff alleges non-payment, still the general rule is that the burden rests
on the defendant to prove payment, rather than on the plaintiff to prove non-
payment."33 Since SCII failed to provide convincing proof that it has already settled the claims,
Pigcaulan should be paid his holiday pay, service incentive leave benefits and proportionate
13th month pay for the year 2000.
 NIÑA JEWELRY MANUFACTURING OF METAL ARTS, INC. (otherwise known as NIÑA
MANUFACTURING AND METAL ARTS, INC.) and ELISEA B. ABELLA, Petitioners,

vs.

MADELINE C. MONTECILLO and LIZA M. TRINIDAD, Respondents.

Facts:

On August 13, 2004, Niña Jewelry imposed a policy for goldsmiths requiring them to
post cash bonds or deposits in varying amounts but in no case exceeding 15% of the latter's
salaries per week. The deposits were intended to answer for any loss or damage which Niña
Jewelry may sustain by reason of the goldsmiths' fault or negligence in handling the gold
entrusted to them. The deposits shall be returned upon completion of the goldsmiths' work
and after an accounting of the gold received.

Niña Jewelry alleged that the goldsmiths were given the option not to post deposits,
but to sign authorizations allowing the former to deduct from the latter's salaries amounts
not exceeding 15% of their take home pay should it be found that they lost the gold entrusted
to them. The respondents claimed otherwise insisting that Niña Jewelry left the goldsmiths
with no option but to post the deposits. The respondents alleged that they were constructively
dismissed by Niña Jewelry as their continued employments were made dependent on their
readiness to post the required deposits.

Issue:

WON respondents were constructively dismissed.

Ruling:

It is settled that there can be dismissal even in the absence of a termination notice.42
However, in the case at bench, we find that the acts of the petitioners towards the respondents
do not at all amount to constructive dismissal.

While employers should generally be given leeways in their exercise of management

prerogatives, we agree with the respondents and the CA that in the case at bar, the petitioners
had failed to prove that their imposition of the new policy upon the goldsmiths under Niña
Jewelry's employ falls under the exceptions specified in Articles 113 and 114 of the Labor
Code. The petitioners should first establish that the making of deductions from the salaries is
authorized by law, or regulations issued by the Secretary of Labor.

ZAYBER JOHN B. PROTACIO, Petitioner,

vs.

LAYA MANANGHAYA & CO. and/or MARIO T. MANANGHAYA, Respondents.

Facts:

Respondent KPMG Laya Mananghaya & Co. (respondent firm) is a general

professional partnership duly organized under the laws of the Philippines. Respondent firm
hired petitioner Zayber John B. Protacio as Tax Manager on 01 April 1996. He was
subsequently promoted to the position of Senior Tax Manager. On 01 October 1997,
petitioner was again promoted to the position of Tax Principal. However, on 30 August
1999, petitioner tendered his resignation effective 30 September 1999. Then, on 01
December 1999, petitioner sent a letter to respondent firm demanding the immediate
payment of his 13th month pay, the cash commutation of his leave credits and the issuance
of his 1999 Certificate of Income Tax Withheld on Compensation. Petitioner sent to
respondent firm two more demand letters for the payment of his reimbursement claims
under pain of the legal action. Respondent firm failed to act upon the demand letters.

Issue:

WON the petitioner is entitled for the bonus.

Ruling:

The fact remains that the amounts paid to petitioner on the two occasions varied and
were always dependent upon the firm’s financial position.

Moreover, in Philippine Duplicators, Inc. v. NLRC,38 the Court held that if the bonus is
paid only if profits are realized or a certain amount of productivity achieved, it cannot be
considered part of wages. If the desired goal of production is not obtained, of the amount of
actual work accomplished, the bonus does not accrue.39 Only when the employer promises
and agrees to give without any conditions imposed for its payment, such as success of
business or greater production or output, does the bonus become part of the wage.40

Petitioner’s assertion that he was responsible for generating revenues amounting to

more than ₱7 million remains a mere allegation in his pleadings. The records are absolutely
bereft of any supporting evidence to substantiate the allegation.

The granting of a bonus is basically a management prerogative which cannot be forced

upon the employer who may not be obliged to assume the onerous burden of granting bonuses
or other benefits aside from the employees’ basic salaries or wages.41 Respondents had
consistently maintained from the start that petitioner was not entitled to the bonus as a matter
of right. The payment of the year-end lump sum bonus based upon the firm’s productivity or
the individual performance of its employees was well within respondent firm’s prerogative.
Thus, respondent firm was also justified in declining to give the bonus to petitioner on account
of the latter’s unsatisfactory performance.

JPL MARKETING PROMOTIONS, Petitioner,

vs.

COURT OF APPEALS, NATIONAL LABOR RELATIONS COMMISSION, NOEL GONZALES,

RAMON ABESA III and FAUSTINO ANINIPOT, Respondents

Facts:

JPL Marketing and Promotions (hereinafter referred to as "JPL") is a domestic

corporation engaged in the business of recruitment and placement of workers. On the other
hand, private respondents Noel Gonzales, Ramon Abesa III and Faustino Aninipot were
employed by JPL as merchandisers on separate dates and assigned at different establishments
in Naga City and Daet, Camarines Norte as attendants to the display of California Marketing
Corporation (CMC), one of petitioner’s clients.

On 13 August 1996, JPL notified private respondents that CMC would stop its direct
merchandising activity in the Bicol Region, Isabela, and Cagayan Valley effective 15 August
1996.3 They were advised to wait for further notice as they would be transferred to other
clients. However, on 17 October 1996,4 private respondents Abesa and Gonzales filed before
the National Labor Relations Commission Regional Arbitration Branch (NLRC) Sub V
complaints for illegal dismissal, praying for separation pay, 13th month pay, service incentive
leave pay and payment for moral damages.5 Aninipot filed a similar case thereafter.

Issue:

WON they are illegally dismissed.

Ruling:

As clearly borne Furthermore, Art. 286 of the Labor Code allows the bona fide
suspension of the operation of a business or undertaking for a period not exceeding six (6)
months, wherein an employee/employees are placed on the so-called "floating status." When
that "floating status" of an employee lasts for more than six months, he may be considered
to have been illegally dismissed from the service. Thus, he is entitled to the corresponding
benefits for his separation, and this would apply to suspension either of the entire business
or of a specific component thereof. The principle applies only when the employee is dismissed
by the employer, which is not the case in this instance. In seeking and obtaining employment
elsewhere, private respondents effectively terminated their employment with JPL.

There is no cause for granting said incentive to one who has already terminated his
relationship with the employer.

The law in protecting the rights of the employees authorizes neither oppression nor
self-destruction of the employer. It should be made clear that when the law tilts the scale of
justice in favor of labor, it is but recognition of the inherent economic inequality between labor
and management. The intent is to balance the scale of justice; to put the two parties on
relatively equal positions. There may be cases where the circumstances warrant favoring labor
over the interests of management but never should the scale be so tilted if the result is an
injustice to the employer.

PETROLEUM SHIPPING LIMITED (formerly ESSO INTERNATIONAL SHIPPING (BAHAMAS)

CO., LTD.) and TRANS-GLOBAL MARITIME AGENCY, INC., Petitioners,

vs.

NATIONAL LABOR RELATIONS COMMISSION and FLORELLO W. TANCHICO, Respondents.

Facts:

On 6 March 1978, Esso International Shipping (Bahamas) Co., Ltd., ("Esso") through
Trans-Global Maritime Agency, Inc. ("Trans-Global") hired Florello W. Tanchico ("Tanchico")
as First Assistant Engineer. In 1981, Tanchico became Chief Engineer. On 13 October 1992,
Tanchico returned to the Philippines for a two-month vacation after completing his eight-
month deployment.

On 8 December 1992, Tanchico underwent the required standard medical

examination prior to boarding the vessel. The medical examination revealed that Tanchico
was suffering from "Ischemic Heart Disease, Hypertensive Cardio-Muscular Disease and
Diabetes Mellitus." Tanchico took medications for two months and a subsequent stress test
showed a negative result. However, Esso no longer deployed Tanchico. Instead, Esso
offered to pay him benefits under the Career Employment Incentive Plan. Tanchico accepted
the offer.

On 26 April 1993, Tanchico filed a complaint against Esso, Trans-Global and Malayan
Insurance Co., Inc. ("Malayan") before the Philippine Overseas Employment Administration
(POEA) for illegal dismissal with claims for backwages, separation pay, disability and medical
benefits and 13th month pay.

Issue:

1. Whether Tanchico is a regular employee of petitioners; and

2. Whether Tanchico is entitled to 13th month pay, disability benefits and attorney’s fees.

Ruling:

The Court cited overseas employment contract as an example of contracts where the
concept of regular employment does not apply, whatever the nature of the engagement and
despite the provisions of Article 280 of the Labor Code. They fall under the exception of Article
280 whose employment has been fixed for a specific project or undertaking the completion
or termination of which has been determined at the time of engagement of the employee or
where the work or services to be performed is seasonal in nature and the employment is for
the duration of the season.

As a Filipino seaman, petitioner is governed by the Rules and Regulations Governing

Overseas Employment and the said Rules do not provide for separation or termination pay.
x x x23

Hence, in the absence of any provision in his Contract governing the payment of 13th
month pay, Tanchico is not entitled to the benefit.

KING OF KINGS TRANSPORT INC., CLAIRE DELA FUENTE and MELISSA LIM, petitioners,

vs.

SANTIAGO O. MAMAC, respondent.

Facts:

Petitioner KKTI is a corporation engaged in public transportation and managed by

Claire Dela Fuente and Melissa Lim. Respondent Mamac was hired as bus conductor of Don
Mariano Transit Corporation (DMTC) on April 29, 1999. Respondent was required to
accomplish a "Conductor’s Trip Report" and submit it to the company after each trip. As a
background, this report indicates the ticket opening and closing for the particular day of duty.
After submission, the company audits the reports. Once an irregularity is discovered, the
company issues an "Irregularity Report" against the employee, indicating the nature and
details of the irregularity. Thereafter, the concerned employee is asked to explain the incident
by making a written statement or counter-affidavit at the back of the same Irregularity
Report. After considering the explanation of the employee, the company then makes a
determination of whether to accept the explanation or impose upon the employee a penalty
for committing an infraction. That decision shall be stated on said Irregularity Report and will
be furnished to the employee.

Upon audit of the October 28, 2001 Conductor’s Report of respondent, KKTI noted an
irregularity. It discovered that respondent declared several sold tickets as returned tickets
causing KKTI to lose an income of eight hundred and ninety pesos. While no irregularity report
was prepared on the October 28, 2001 incident, KKTI nevertheless asked respondent to
explain the discrepancy. In his letter,3 respondent said that the erroneous declaration in his
October 28, 2001 Trip Report was unintentional. He explained that during that day’s trip, the
windshield of the bus assigned to them was smashed; and they had to cut short the trip in
order to immediately report the matter to the police. As a result of the incident, he got
confused in making the trip report.

On November 26, 2001, respondent received a letter4 terminating his employment effective
November 29, 2001. The dismissal letter alleged that the October 28, 2001 irregularity was
an act of fraud against the company. KKTI also cited as basis for respondent’s dismissal the
other offenses he allegedly committed since 1999.

Issue:

WON verbal appraisal of the charges against an employee does not comply with the first
notice requirement.

Ruling:

Due process under the Labor Code involves two aspects: first, substantive––the valid
and authorized causes of termination of employment under the Labor Code; and second,
procedural––the manner of dismissal.

First, respondent was not issued a written notice charging him of committing an
infraction. The law is clear on the matter. A verbal appraisal of the charges against an
employee does not comply with the first notice requirement.

Second, even assuming that petitioner KKTI was able to furnish respondent an
Irregularity Report notifying him of his offense, such would not comply with the requirements
of the law. We observe from the irregularity reports against respondent for his other offenses
that such contained merely a general description of the charges against him. The reports did
not even state a company rule or policy that the employee had allegedly violated. Likewise,
there is no mention of any of the grounds for termination of employment under Art. 282 of
the Labor Code. Thus, KKTI’s "standard" charge sheet is not sufficient notice to the employee.
 LETRAN CALAMBA FACULTY and EMPLOYEES ASSOCIATION, petitioner,

vs.

NATIONAL LABOR RELATIONS COMMISSION and COLEGIO DE SANJUAN DE LETRAN

CALAMBA, INC., respondent

Facts:

On October 8, 1992, the Letran Calamba Faculty and Employees Association

(petitioner) filed with Regional Arbitration Branch No. IV of the National Labor Relations
Commission (NLRC) a Complaint against Colegio de San Juan de Letran, Calamba, Inc.
(respondent) for collection of various monetary claims due its members. Subsequently, these
three cases were consolidated.
The Labor Arbiter (LA) dismissed both the money claims of the petitioners and the
petition to declare strike illegal filed by respondent. Both parties appealed to the NLRC and
CA who both affirmed the decision of LA.

Petitioner’s Contention: Since the pay for excess loads or overloads does not fall under any
of the enumerated exclusions in the computation of basic pay of an employee (such as cash
equivalents of unused vacation and sick leave credits, overtime, premium, night differential,
holiday pay and cost-of-living allowances); and considering that the said overloads are being
performed within the normal working period of eight hours a day, it only follows that the
overloads should be included in the computation of the faculty members’ 13th-month pay.

Respondent’s Contention: Contrary to the asseveration of petitioner, prior to the issuance of

the DOLE Order, the prevailing rule is to exclude excess teaching load, which is akin to
overtime, in the computation of a teacher’s basic salary and, ultimately, in the computation
of his 13th-month pay.

ISSUE: Whether or not an overload must be included for the purposes of computing the 13th
month pay of a teacher.

RULING:

NO. An overload pay, owing to its very nature and definition, may not be considered
as part of a teacher’s regular or basic salary, because it is being paid for additional work
performed in excess of the regular teaching load.

“Overload work” is sometimes misunderstood as synonymous to “overtime work” as this term

is used and understood in the Labor Code. These two terms are not the same because
overtime work is work rendered in excess of normal working hours of eight in a day (Art. 87,
Labor Code). Considering that overload work may be performed either within or outside eight
hours in a day, overload work may or may not be overtime work.
Any teaching load in excess of the normal or regular teaching load shall be considered as
overload and does not form part of the regular or basic pay.
 In accordance with Article 83 of the Labor Code of the Philippines, as amended, the normal
hours of work of school academic personnel shall not exceed eight (8) hours a day. Any work
done in addition to the eight (8) hours daily work shall constitute overtime work.

Under the Labor Code of the Philippines. To cite a few provisions:

“Art. 87 – Overtime work. Work may be performed beyond eight (8) hours a day provided
that the employee is paid for the overtime work, additional compensation equivalent to his
regular wage plus at least twenty-five (25%) percent thereof.”
It is clear that overtime pay is an additional compensation other than and added to the regular
wage or basic salary, for reason of which such is categorically excluded from the definition of
basic salary under the Supplementary Rules and Regulations Implementing Presidential
Decree 851.
Similarly, even if an overload is performed within the normal eight-hour working day, an
overload is still an additional or extra teaching work which is performed after the regular
teaching load has been completed. Hence, any pay given as compensation for such additional
work should be considered as extra and not deemed as part of the regular or basic salary.