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The Supreme Court ruled that a provision in a collective bargaining agreement (CBA) condoning non-compliance with a mandatory wage order increase was invalid. Specifically:
1) Section 3 of the CBA purported to exempt the company from implementing a required P12 wage increase, but only the Tripartite Wage Productivity Board has authority to grant such exemptions.
2) By agreeing to exempt the company from the wage increase, the CBA provision contravened the mandate of the wage order, and parties cannot set wages lower than the minimum required by law.
3) While CBAs can establish reasonable terms, any provision violating law, public policy or mandatory wage orders will be considered void.
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Originaltitel
Manila Fashions v NLRC and Nagkakaisang Manggagawa (1996)
The Supreme Court ruled that a provision in a collective bargaining agreement (CBA) condoning non-compliance with a mandatory wage order increase was invalid. Specifically:
1) Section 3 of the CBA purported to exempt the company from implementing a required P12 wage increase, but only the Tripartite Wage Productivity Board has authority to grant such exemptions.
2) By agreeing to exempt the company from the wage increase, the CBA provision contravened the mandate of the wage order, and parties cannot set wages lower than the minimum required by law.
3) While CBAs can establish reasonable terms, any provision violating law, public policy or mandatory wage orders will be considered void.
The Supreme Court ruled that a provision in a collective bargaining agreement (CBA) condoning non-compliance with a mandatory wage order increase was invalid. Specifically:
1) Section 3 of the CBA purported to exempt the company from implementing a required P12 wage increase, but only the Tripartite Wage Productivity Board has authority to grant such exemptions.
2) By agreeing to exempt the company from the wage increase, the CBA provision contravened the mandate of the wage order, and parties cannot set wages lower than the minimum required by law.
3) While CBAs can establish reasonable terms, any provision violating law, public policy or mandatory wage orders will be considered void.
Manila Fashions v NLRC and Nagkakaisang Manggagawa (1996) Was the condonation of the implementation of Wage Order No.
ion of Wage Order No. NCR-
02 and 02-A contained in Sec. 3, Art. VIII, of the CBA valid? NO Facts: the condonation appearing in Sec. 3, Art. VIII, of the CBA did not Nagkakaisang Manggagawa ng Manila Fashions, Inc., through its exempt petitioner from compliance with Wage Order No. NCR-02 and president, R Nonito Zamora, filed a complaint before the LA on behalf 02-A. of (150) members who were regular employees of P Manila Fashions, - A Collective Bargaining Agreement refers to the negotiated Inc. The complaint charged the company with noncompliance with contract between a legitimate labor organization and the Wage Order ordering a P12 increase in wages effective 8 January 1991. employer concerning wages, hours of work and all other terms The complainants basic pay, 13th month pay, service incentive leave and conditions of employment in a bargaining unit, including pay, legal holiday pay, night shift differential and overtime pay were all mandatory provisions for grievances and arbitration underpaid. Petitioner alleged that the failure to comply with the Wage machineries Order was brought about by the tremendous losses suffered by it which o As in all other contracts, the parties in a CBA may were aggravated when the workers staged a strike on account of the establish such stipulations, clauses, terms and non-adjustment of their pay. To forestall continuous suspension/closure conditions as they may deem convenient provided they of business operations, the strikers sent a notice that they were willing to are not contrary to law, morals, good customs, public condone the implementation of the increase. The condonation was order or public policy. distinctly stated in Sec. 3, Art. VIII, of the CBA dated 4 February 1992, - Section 3, Art. VIII, of the CBA is a void provision because by which was voluntarily entered into by the parties and represents a agreeing to condone the implementation of the Wage Order the reasonable settlement. The complainants admitted the existence of the parties thereby contravened its mandate on wage increase of provision in the CBA but they denied its validity because it was not P12.00 effective 8 January 1991 reached after due consultation with the members. The Labor Arbiter - it is only the Tripartite Wage Productivity Board of the DOLE sustained the claim that the subject provision of the CBA was void that could approve exemption of an establishment from based on the ground that the provision is null and void, being contrary to coverage of a Wage Order. law. Since only the Tripartite Wage Productivity Board of the DOLE - If petitioner is a financially distressed company then it should could approve exemption of an establishment from the coverage of a have applied for a wage exemption so that it could meet its wage order. The company was adjudged liable to each of the labor costs without endangering its viability or its very complainants for underpayment of salary, 13 th month, vacation leave existence upon which both management and labor depend for a and legal holiday pay in the total amount of 900, 012. All other claims living were dismissed for lack of merit. The company maintains that the - parties to a CBA may not by themselves, set a wage lower than condonation is valid. In support thereof, it invokes cases decided by this the minimum wage. To do so would render nugatory the Court applying the rule that if the agreement was voluntarily entered purpose of a wage exemption, not to mention the possibility that into and represents a reasonable settlement it is binding on the parties employees may be unwittingly put in a position to accept a and may not be disowned simply because of a change of mind. lower wage. - The cases that petitioner relies on are simply inapplicable ISSUES + RULING because, unlike the present case which involves a stipulation in the CBA in contravention of law, they are concerned with compromise settlements as a means to end labor disputes recognized by Art. 227 of the Labor Code and considered not against public policy by doctrinal rules established by this Court.
SAN MIGUEL CORPORATION, ANGEL G. ROA and MELINDA MACARAIG, vs. NATIONAL LABOR RELATIONS COMMISSION (Second Division), LABOR ARBITER EDUARDO J. CARPIO, ILAW AT BUKLOD NG MANGGAGAWA (IBM), ET AL