Labor Law Refresher 2000

Atty. Paciano F. Fallar Jr.

SSCR-CoL

Salaries and Benefits

Part 2

Q21.Percival was a mechanic of Pacific Airlines. He enjoyed a meal break of one hour.
However, during meal breaks, he was required to be on stand-by for emergency work.
During emergencies, he was made to forego his meals or to hurry up eating. He
demanded payment of overtime for work done during his meal periods. Is Percival
correct? Explain your answer.

Q22 Lito Kulangkulang and Bong Urongsulong are employed as truck drivers of Line
Movers, Inc. Usually. Lito is required by the personnel manager to just stay at the head
office after office hours because he could be called to drive the trucks. While at the
head office. Lito merely waits in the manager's reception room. On the other hand. Bong
is allowed to go home after office hours but iscould be contacted whenever his services
as driver becomes necessary.

Would the hours that Lito and Bong are on call be considered compensable working
hours?

Q23.Gil Bates, a computer analyst and programmer of Hard Drive Company, work eight
hours a day for five days a week at the main office providing customers information
technology assistance. On Saturdays, however, the company requires him to keep his
cellular phone open from 8:00 A.M. to 5:00 P.M. so that the Management could contact
him in case of heavy work load or emergency problems needing his expertise.

May said hours on Saturdays be considered compensable working hours “while on

call”? If so, should said compensation be reported to the Social Security System?

Q24.Which of the following is not compensable as hours worked?

a. Travel away from home;

b. Travel from home to work;
c. Working while on call;
d. Travel that is all in a day's work.

Q25: The meal time (lunch break) for the dining crew in Glorious Restaurant is either
from 10 a.m. to 11 a.m. or from 1:30 p.m. to 2:30 p.m., with pay. But the management
wants to change the mealtime to 11 a.m. to 12 noon or 12:30 p.m. to 1:30 p.m., without
pay. Will the change be legal?

Q26. Under what conditions may a "compressed work week" schedule be legally authorized as
an exception to the "eight-hour a day" requirement under the Labor Code?

ANSWER:

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The conditions for an allowable "compressed work week" are the following: a) the majority of
the workers agree to the temporary change of work schedule ;and b) they do not suffer any loss
in their take home pay

Q27: Due to his employer’s dire financial situation, Nicanor was prevailed upon by his
employer to voluntarily resign. In exchange, he demanded payment of salary
differentials,13th month pay, and financial assistance, as promised by his employer.
Management promised to pay him as soon as it is able to pay off all retrenched rank-
and-file employees. Five years later, and before management was able to pay Nicanor
the amount promised to him, Nicanor died of a heart attack. His widow, Norie, filed a
money claim against the company before the National Labor Relations Commission
(NLRC), including interest on the amount of the unpaid claim. She also claimed
additional damages arguing that the supposed resignation letter was obtained from her
spouse through undue pressure and influence. The employer filed a motion to dismiss
on the ground that (A) the NLRC did not have jurisdiction over money claims, and (B)
the action has prescribed.

(a) Does the NLRC have jurisdiction to award money claims including interest on the
amount unpaid?

(b) Assuming that the NLRC has jurisdiction, has the action prescribed. May Nicanor’s
spouse successfully claim additional damages as a result of the alleged undue pressure
and influence?

Q28.In computing for 13th month pay, Balagtas Company used as basis both the
employee’s regular base pay and the cash value of his unused vacation and sick
leaves. After two and a half years, it announced that it had made a mistake and was
discontinuing such practice. Is the management action legally justified?

(a) Yes, since 13th month pay should only be one-twelfth of the regular pay.
(b) No, since the erroneous computation has ripened into an established, non-
withdrawable practice.
(c) Yes, an error is not a deliberate decision, hence may be rectified.
(d) No, employment benefits can be withdrawn only through a CBA negotiation.

Q29. D, one of the sales representatives of OP, Inc., was receiving a basic pay of
P50,000.00 a month, plus a 1% overriding commission on his actual sales transactions.
In addition, beginning three (3) months ago, or in August 2019, D was able to receive a
monthly gas and transportation allowance of P5,000.00 despite the lack of any company
policy therefor.

In November 2019, D approached his manager and asked for his gas and transportation
allowance for the month. The manager declined his request, saying that the company
had decided to discontinue the aforementioned allowance considering the increased
costs of its overhead expenses. In response, D argued that OP, Inc.’s removal of the
gas and transportation allowance amounted to a violation of the rule on non-diminution
of benefits.

Is the argument of D tenable? Explain. (2.5%)

Q30. X Company’s CBA grants each employee a 14th month year-end bonus. Because
the company is in financial difficulty, its head wants to negotiate the discontinuance of
such bonus. Would such proposal violate the “non-diminution rule” in the Labor Code?

Q31. Lito was anticipating the bonus he would receive for 2013. Aside from the 13th
month pay, the company has been awarding him and his other co-employees a two to
three months bonus for the last 10 years. However, because of poor over-all sales

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performance for the year, the company unilaterally decided to pay only a one-month
bonus in 2013. Is Lito’s employer legally allowed to reduce the bonus?

Q32. Far East Bank (FEB) is one of the leading banks in the country. Its compensation
and bonus packages are top of the industry. For the last 6 years, FEB had been
providing the following bonuses across-the-board to all its employees: a. 13th month
pay; b. 14th to 18th month pay; c. Christmas basket worth P6,000; d. Gift check worth
P4,000; and e. Productivity-based incentive ranging from a 20% to 40% increase in
gross monthly salary for all employees who would receive an evaluation of "Excellent"
for 3 straight quarters in the same year. Because of its poor performance over-all, FEB
decided to cut back on the bonuses this year and limited itself to the following:

a. 13th month pay;

b. 14th month pay;
c. Christmas basket worth P4,000; and
d. Gift check worth: P2,000

Katrina, an employee of FEB, who had gotten a rating of "Excellent" for the last 3
quarters, was looking forward to the bonuses plus the productivity incentive bonus. After
learning that FEB had modified the bonus scheme, she objected. Is Katrina's objection
justified? Explain.

Q33. A wage order may be reviewed on appeal by the National Wages and Productivity
Commission under these grounds, except:

a. grave abuse of discretion;

b. non-conformity with prescribed procedure;

c. questions of law

d. gross under or over-valuation

Q34.Which is not a procedural requirement for the correction of wage distortion in an

unorganized establishment?

a. Both employer and employee will attempt to correct the distortion;

b. Settlement of the dispute through National Conciliation and Mediation Board (NCMB);

c. Settlement of the dispute through voluntary arbitration in case of failure to resolve

dispute through CBA dispute mechanism;

d. A and B.

Q35.Upon review of the wage rate and structure pertaining to its regular rank and file
employees, K Corporation found it necessary to increase its hiring rates for belonging to
the different job classification levels to make their salary rates more competitive in the
labor market.

After the implementation of the new hiring salary, Union X, the exclusive bargaining
agent of the rank and file employees, demanded a similar salary adjustment for the old
employees. It argued that the increase in hiring rates resulted in wage distortion since it
erased the wage gap between the new and old employees. In other words, new
employees would enjoy almost the same salary rates as K Corporation’s old employees.

(a) What is wage distortion?

(b) Did a wage distortion arise under the circumstances which legally obligated K
Corporation to rectify the wages of its old employees? Explain.

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Q36. How should a wage distortion be resolved

(a) in case there is a collective bargaining agreement

(b) in case there is none?

Q37: The Regional Tripartite Wages and Productivity Board (RTWPB) for Region 3
issued a wage order on November 2, 2017 fixing the minimum wages for all industries
throughout Region 3.

(a) Is the wage order subject to the approval of the National Wages and Productivity
Commission before it takes effect?

(b) The law mandates that no petition for wage increase shall be entertained within a
period of 12 months from the effectivity of the wage order.
Q24.Which of the following is not compensable as hours worked?

PFFALLARJROCT2020