Dy, Maria Catherine Z

Block A
Uniwide Sales Warehouse Club v. NLRC CASE # 32
(G.R. No. 154503, Feb 29, 2008)

ISSUE: May an employer be allowed to discipline his employees?

RULING: Yes, The right to impose disciplinary sanctions upon an employee for just
and valid cause, as well as the authority to determine the existence of said cause in
accordance with the norms of due process, pertains in the first place to the employer. ,
Petitioners gave private respondent successive memoranda so as to give the latter an
opportunity to controvert the charges against her. Clearly, the memoranda are not
forms of harassment, but petitioners' compliance with the requirements of due process.
Dy, Maria Catherine Z
Block A
Mayon Hotel and Restaurant v Adana CASE # 33
(G.R. No. 157634, May 16, 2005)

ISSUE: Are all facilities and supplements received by the employees deductible
from their wage?

RULING: No, even granting that meals and snacks were provided and indeed
constituted facilities, such facilities could not be deducted without compliance with
certain legal requirements. As stated in Mabeza v. NLRC, the employer simply cannot
deduct the value from the employee's wages without satisfying the following: (a) proof
that such facilities are customarily furnished by the trade; (b) the provision of deductible
facilities is voluntarily accepted in writing by the employee; and (c) the facilities are
charged at fair and reasonable value. The records are clear that petitioners failed to
comply with these requirements. There was no proof of respondents' written
authorization. Indeed, the Labor Arbiter found that while the respondents admitted that
they were given meals and merienda, the quality of food served to them was not what
was provided for in the Facility Evaluation Orders and it was only when they filed the
cases that they came to know of this supposed Facility Evaluation Orders. Petitioner
Josefa Po Lam herself admitted that she did not inform the respondents of the facilities
she had applied for.

Considering the failure to comply with the above-mentioned legal

requirements, the Labor Arbiter therefore erred when he ruled that the cost of the
meals actually provided to respondents should be deducted as part of their salaries, on
the ground that respondents have availed themselves of the food given by
petitioners.90 The law is clear that mere availment is not sufficient to allow deductions
from employees' wages.

We also do not agree with petitioners that the five (5) percent of the
gross income of the establishment can be considered as part of the respondents' wages.
We quote with approval the Labor Arbiter on this matter, to wit:

While complainants, who were employed in the hotel, receive[d] various

amounts as profit share, the same cannot be considered as part of their wages in
determining their claims for violation of labor standard benefits. Although called profit
share[,] such is in the nature of share from service charges charged by the hotel. This is
more explained by [respondents] when they testified that what they received are not
fixed amounts and the same are paid not on a monthly basis (pp. 55, 93, 94, 103, 104;
vol. II, rollo). Also, [petitioners] failed to submit evidence that the amounts received by
[respondents] as profit share are to be considered part of their wages and had been
agreed by them prior to their employment. Further, how can the amounts receive[d] by
[respondents] be considered as profit share when the same [are] based on the gross
receipt of the hotel[?] No profit can as yet be determined out of the gross receipt of an
enterprise. Profits are realized after expenses are deducted from the gross income.

As for petitioners repeated invocation of serious business losses, suffice

to say that this is not a defense to payment of labor standard benefits. The employer
cannot exempt himself from liability to pay minimum wages because of poor financial
condition of the company. The payment of minimum wages is not dependent on the
employer's ability to pay.
Dy, Maria Catherine Z
Block A
Mabeza v. NLRC CASE # 34
(G.R. No. 118506, April 18, 1997)

ISSUE: Are facilities and supplements provided to the employees for the
employers benefit deductible from their wage?

RULING: No, Labor Arbiter Pati accepted hook, line and sinker the private
respondent's bare claim that the reason the monetary benefits received by petitioner
between 1981 to 1987 were less than minimum wage was because petitioner did not
factor in the meals, lodging, electric consumption and water she received during the
period in her computations. Granting that meals and lodging were provided and indeed
constituted facilities, such facilities could not be deducted without the employer
complying first with certain legal requirements. Without satisfying these requirements,
the employer simply cannot deduct the value from the employee's ages. 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. Finally, facilities must be charged at fair and reasonable value.

These requirements were not met in the instant case. Private respondent
"failed to present any company policy or guideline to show that the meal and lodging . . .
(are) part of the salary;" he failed to provide proof of the employee's written
authorization; and, he failed to show how he arrived at the valuations.

Curiously, in the case at bench, the only valuations relied upon by the
labor arbiter in his decision were figures furnished by the private respondent's own
accountant, without corroborative evidence. On the pretext that records prior to the
July 16, 1990 earthquake were lost or destroyed, respondent failed to produce payroll
records, receipts and other relevant documents, where he could have, as has been
pointed out in the Solicitor General's manifestation, "secured certified copies thereof
from the nearest regional office of the Department of Labor, the SSS or the BIR."

More significantly, the food and lodging, or the electricity and water
consumed by the petitioner were not facilities but supplements. A benefit or privilege
granted to an employee for the convenience of the employer is not a facility. The
criterion in making a distinction between the two not so much lies in the kind (food,
lodging) but the purpose. Considering, therefore, that hotel workers are required to
work different shifts and are expected to be available at various odd hours, their ready
availability is a necessary matter in the operations of a small hotel, such as the private
respondent's hotel.
Dy, Maria Catherine Z
Block A
States Marine Corporation and Royal CASE # 35
Line, Inc. v. Cebu Seamens Association,
Inc
(G.R. No. L-12444, February 28, 1963)

ISSUE: what may be considered as supplements and facilities and which one is
deductible from the employees wage?

RULING: "Supplements", therefore, constitute extra remuneration or special

privileges or benefits given to or received by the laborers over and above their ordinary
earnings or wages. "Facilities", on the other hand, are items of expense necessary for
the laborer's and his family's existence and subsistence so that by express provision of
law (Sec. 2[g]), they form part of the wage and when furnished by the employer are
deductible therefrom, since if they are not so furnished, the laborer would spend and
pay for them just the same.

In short, the benefit or privilege given to the employee which constitutes

an extra remuneration above and over his basic or ordinary earning or wage, is
supplement; and when said benefit or privilege is part of the laborers' basic wages, it is
a facility. The criterion is not so much with the kind of the benefit or item (food, lodging,
bonus or sick leave) given, but its purpose. Considering, therefore, as definitely found by
the respondent court that the meals were freely given to crew members prior to August
4, 1951, while they were on the high seas "not as part of their wages but as a necessary
matter in the maintenance of the health and efficiency of the crew personnel during the
voyage", the deductions therein made for the meals given after August 4, 1951, should
be returned to them, and the operator of the coastwise vessels affected should
continue giving the same benefit.