LATEST SUPREME

COURT JURISPRUDENCE
ON LABOR STANDARD
CASES
ATTY. LR LUMBAY
NCMB

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LABOR STANDARDS
and LABOR
RELATIONS

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LABOR STANDARDS LAW - that

which sets out the minimum terms,
conditions
and
benefits
of
employment that employers must
provide or comply with and to
which employees are entitled as a
matter of legal right.

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LABOR
STANDARDS

the
minimum requirements prescribed
by
existing
laws,
rules
and
regulations relating to wages, hours
of work, cost of living allowance,
and other monetary and welfare
benefits,
including
occupational,
safety, and health standards.

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LABOR RELATIONS LAW that

which defines the status, rights
and duties, and the institutional
mechanisms, that govern the
individual
and
collective
interactions
of
employers,
employees
or
their
representatives.

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LEGAL DOCTRINES
ON LABOR
STANDARDS

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With respect to money claims:

1.
Insofar
as
ordinary
labor
standard
money
claims
are
concerned, the burden of proving
compliance with the law rests with the
employer.

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2. But insofar as money claims

considered
as
extraordinary
such as claims for overtime, night
shift differential, holiday and rest
day pay premium, the burden of
proof is shifted to the worker who
must prove he rendered overtime
work or that he worked at night, or
that he worked during holidays and
rest days. (National Semi Conductor
Distribution Ltd vs NLRC, G.R. No. 123520,
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OVERTIME PAY - The employee

must first establish by proof that said
overtime work was actually performed
before he may avail of said benefit.
(Villar, et al. vs. NLRC et al. G.R. No.
130935, May 11, 2000)

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MONEY CLAIMS All money claims

arising from an employer-employee
relationship shall be filed within three
years from the time the cause of action
accrued; otherwise, they shall be
forever barred.
The amount that can only be
demanded by the aggrieved employee
shall be limited to the amount of the
benefits withheld within three years
before the filing of the complaint. (FAR
EAST AGRICULTURAL SUPPLY, INC., vs
JIMMY
LEBATIQUE and THE HONORABLE COURT OF APPEALS,
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NON PAYMENT OF WAGES - Settled

is the rule that the employer has the
burden of proving that the money claims
wages have been paid.
This is because the pertinent
personnel
files,
payrolls,
records,
remittances and other similar documents
which will show that the claims have
been paid are not in the possession of
the workers but in the custody and
absolute control of the employer. (Villar, et
al. vs. NLRC et al. G.R. No. 130935, May 11,
2000).
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BEST PROOF OF PAYMENT OF

LABOR STANDARDS BENEFITS Voucher is not necessarily evidence
of payment as it is only a method of
keeping track of payment made, the
voucher must still be supported by
an actual payment of cash duly
receipted for, or the issuance of a
check
subsequently
enchashed.
(Alonzo vs. San Juan, G.R. No. 137549,
Feb. 11, 2005)
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The best proof of the fact of

payment is a receipt or a payroll.
This is because receipt and payroll
are
in
writing,
signed
and
contained acknowledgment that
the money had been paid. In short,
receipt and payroll are substantial
proof of actual payment. (KAR ASIA,
INC.,

and/or

CELESTINO

BARRETO

vs

MARIO

CORONA, ET AL, G.R. NO. 154985, August 24, 2004)

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QUIT CLAIMS -
Generally, deeds of release, waiver
or quitclaims cannot bar employees
from demanding benefits to which they
are legally entitled or from contesting
the legality of their dismissal since
quitclaims are looked upon with disfavor
and are frowned upon as contrary to
public policy.

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Where, however, the person

making the waiver has done so
voluntarily,
with
a
full
understanding thereof, and the
consideration for the quitclaim is
credible and reasonable, the
transaction must be recognized
as being a valid and binding
undertaking. (FRANCISCO SORIANO, JR., vs
NLRC, G.R. No. 165594, April 23, 2007 )
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REDUCTION OF WORKING HOURS In order for the reduction of working hours

to be valid, the following should be
considered

the
arrangement
was
temporary, it was a more humane solution
instead of a retrenchment of personnel, there
was notice and consultations with the
workers and supervisors, a consensus were
reached on how to deal with deteriorating
economic conditions and it was sufficiently
proven that the company was suffering from
losses. (LINTON COMMERCIAL CO., INC. and DESIREE
ONG vs ALEX A. HELLERA et al., G.R. No. 163147
,October 10, 2007)
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SERVICE INCENTIVE LEAVE Every employee who

has rendered at least one year of service is entitled
to yearly service incentive leave of five days with
pay.
Employees not covered:
1. Those of the government and any of its political
subdivisions, including GOCC;
2. Domestic helpers and persons in the personal
service of another;
3. Managerial employees;
4. Field personnel and other employee whose
performance is unsupervised by the employer;
5. Those who are already enjoying the benefit;
6. Those enjoying vacation leave with pay of at least
5 days; and

7. Those

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employed in establishments regularly

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Manner of availment of SIL

SIL may be used for sick and
vacation leave purposes. And at the
end of the year, the unused SIL may
be commuted to cash.

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VACATION LEAVE/SICK LEAVE

not legally mandated benefit since it
is a voluntary benefits undertaken by
companies to help the employee.
Once it is granted to employees, it
becomes part of company policy and
could no longer be revoked without
violating the principle of non
diminution of benefits.

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CHARLITO PEARANDA,
- versusBAGANGA PLYWOOD
CORPORATION
HUDSON

and
CHUA,

G.R. No. 159577

May 3, 2006

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FACTS:
Allegation of Complainant:
On
March
1999,
complainant
Pearanda was hired as Foreman/Boiler
Head/Shift Engineer of Baganga Plywood
Corporation (BPC).
Alleges that he was a regular
employee and was illegally terminated
on December 2000 and was not paid his
overtime pay, premium pay for working
during holiday/rest days and night shift
differentials.
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Allegation of Respondent:
BPC alleges that complainants
separation from service was due to the
temporary closure of the company for
its repair and general maintenance and
that he insisted to be paid his
separation benefits .
Consequently, when BPC partially
reopened in January 2001, complainant
failed to reapply.
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 Being a managerial employee, he is

not entitled to overtime pay and if
ever he rendered services beyond
the normal hours of work, [there] was
no office order/or authorization for
him to do so.

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Ruling of the Labor Arbiter :

No illegal dismissal since
temporary closure of BPCs plant
did not terminate his employment.
Awarded overtime pay, premium
pay for working on rest days as
complainant
was
a
regular/common
employee
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Ruling of the NLRC:

Deleted the award of overtime
pay and premium pay for working
on rest days since complainant
was a managerial employee.

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Ruling of the Court of Appeals:

Dismissed complainants
Petition for Certiorari
due to
technicalities.

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ISSUES:

1)Whether or not complainant was

a managerial employee.
2)Whether or not complainant is
entitled to overtime pay and
premium pay.

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Ruling of the Supreme Court:

Complainant is not a
managerial employee but a
member of the managerial
staff, which also takes him
out of the coverage of labor
standards.

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 Complainant
supervised
the
engineering section of the steam plant
boiler.

His work involved overseeing the

operation of the machines and the
performance of the workers in the
engineering section which necessarily
required the use of discretion and
independent judgment to ensure the
proper functioning of the steam plant
boiler. As supervisor, petitioner is
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deemed
a
of>> the
managerial

Being a supervisor, complainant is

not entitled to his claims for overtime
pay, premium pay for working during
holiday/rest days and night shift
differentials.

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SLL INTERNATIONAL
CABLES SPECIALIST and
SONNY L. LAGON,
- versusNATIONAL LABOR
RELATIONS
COMMISSION, 4TH
DIVISION, ROLDAN
LOPEZ, EDGARDO
ZUIGA and DANILO
CAETE,

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G.R. No. 172161

March 2, 2011
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FACTS:
Allegation of the Complainants:

Complainants
were
hired
by
respondent as apprentice or trainee
cable/lineman in 1996.
After their training, complainants were
engaged as project employees by
respondents in their Islacom project in
Bohol from March 15, 1997 until
December 1997, after which their
employment were terminated.
Complainants
were >>receiving
their
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Sometime
in
March
1998
to
September 1998, Complainants were
engaged again byrespondent as project
employees for its PLDT Antipolo, Rizal
project.
As a consequence, complainants
employment was terminated.
Complainants were receiving their
salary below the minimum wage.
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In November 1998 to March 1999,

complainants were re employed in
respondents Racitelcom project in
Bulacan.
Complainants were receiving their
salary below the minimum wage.

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On May 21, 1999, complainants for

the 4th time worked with respondents
project in Camarin, Caloocan City with
Furukawa Corporation as the general
contractor.
Their contract would expire on
February 28, 2000, the period of
completion of the project.
Complainants were receiving their
salary below the minimum wage.
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The Camarin project was not
completed on the scheduled date of
completion due to delay in the delivery
of imported materials .
Respondent was constrained to cut
down the overtime work of its workers,
including complainants.

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Thus,
when
requested
by
complainants on February 28, 2000 to
work overtime, respondent refused and
told them 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.

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This prompted complainants to

leave their work and went home to
Cebu.
On March 3, 2000, complainants
filed a complaint for illegal dismissal,
non-payment of wages, holiday pay,
13th month pay for 1997 and 1998 and
service incentive leave pay as well as
damages and attorneys fees.

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Allegation of Respondent:
Complainants were only project
employees, for their services were
merely engaged for a specific project or
undertaking and the same were covered
by contracts duly signed by them.
Food allowance of P63.00 per day as
well as allowance for lodging house,
transportation, electricity, water and
snacks allowance should be added to
complainants basic pay.
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Ruling of the Labor Arbiter :

Complainants
were
regular
employees because they were
repeatedly hired by respondents and
they performed activities which were
usual, necessary and desirable in
the business or trade of the
employer.

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Complainants were underpaid. It

ruled that the free board and lodging,
electricity, water, and food enjoyed by
them could not be included in the
computation of their wages because
these were given without their written
Complainants were not illegally
consent.
dismissed since their act of going home
was an act of indifference when
respondents
decided
to
prohibit
overtime work .
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Ruling of the NLRC:

Affirmed the findings of the LA.

It noted that not a single report of

project completion was filed with the
nearest
DOLE
as
required
Department Order No. 19, Series of
1993.

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Department Order No. 19, Series

of 1993employment.
Indicators of project
Either one or more of the following
circumstances, among other, may be
considered as indicators that an
employee is a project employee.
(a)The
duration
of
the
specific/identified undertaking for
which the worker is engaged is
reasonably determinable.
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(b) Such duration, as well as the specific

work/service to be performed, is defined
in an employment agreement and is
made clear to the employee at the time
of
(c)hiring.
The work/service performed by the
employee is in connection with the
particular project/undertaking for which
he
engaged.
d) is
The
employee, while not employed
and awaiting engagement, is free to
offer his services to any other employer.
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(e) The termination of his employment

in the particular project/undertaking is
reported to the DOLE Regional Office
having jurisdiction over the workplace
within 30 days following the date of his
separation from work, using the
prescribed
form
on
employees
termination/dismissals/suspensions.

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An
undertaking
in
the
employment contract by the
employer to pay completion
bonus to the project employee as
practiced by most construction
companies.
(f)

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Ruling of the Court of Appeals:

Affirmed the findings of the NLRC.

Complainants
were
regular
employees performing functions
which were the regular and usual
business of respondent.

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ISSUE:
1) Whether or not the value of the
facilities that the complainants
enjoyed should be included in the
computation of the wages received
by them.

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uling of the Supreme Court:

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.
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Respondents, aside from bare

allegations that complainants received
wages higher than the prescribed
minimum, failed to present any
evidence, such as payroll or payslips,
to support their defense of payment.

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 Before the value of facilities can be

deducted from the employees wages,
the following requisites must all be
attendant:
1) Proof must be shown that such
facilities are customarily furnished by
the trade;
2) The provision of deductible facilities
must be voluntarily accepted in
writing by the employee; and
3)
Facilities must be charged at
reasonable value. Mere availment is
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Respondents failed to present

any company policy or guideline
showing that provisions for meals
and lodging were part of the
employees salaries.
It also failed to provide proof
of
the
employees
written
authorization, much less show
how
they
arrived
at
their
valuations.
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Distinction between facilities and

supplements

"Supplements" constitute extra

remuneration or special privileges
or benefits given to or received by
the laborers over and above their
ordinary earnings or wages.

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Facilities are items of expense

necessary for the laborer's and his
family's existence and subsistence
and it forms 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.
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The
allowances
allegedly
enjoyed by the complainants are
supplements.

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C. PLANAS COMMERCIAL
and/or MARCIAL COHU
- versusNATIONAL LABOR
RELATIONS COMMISSION
(Second Div.), ALFREDO
OFIALDA, DIOLETO
MORENTE and RUDY
ALLAUIGAN
G.R. No. 144619
November 11, 2005
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FACTS:

On
September
14,
1993,
complainants,
who
are
laborers/helpers, filed a complaint for
underpayment of wages, nonpayment
of overtime pay, holiday pay, service
incentive leave pay and premium pay
for holiday and rest day and night shift
differential against respondents.

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Allegation
of Complainants:
Respondent
Cohu, owner of C. Planas
Commercial, is engaged in wholesale of
plastic products and fruits of different kinds
with more than 24 employees;
Paid below the minimum wage law for the
past 3 years;
Required to work for more than 8 hours a
day without overtime pay;
Never enjoyed holiday pay and did not
have a rest day as they worked for 7 days a
week; and
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They were not paid service incentive

leave pay although they had been
working for more than one year.

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Allegation of the Respondent:

Admitted that complainants were their
helpers who used to accompany the
delivery trucks and helped in the loading
and unloading of merchandise being
distributed to clients;
Usually started their work from 10 a.m.
to 6 p.m.;
Stopped working with petitioners
sometime in September 1993 as they were
already
working
in
other
establishments/stalls in Divisoria;
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Not entitled to holiday and

service incentive leave pays for
they were employed in a retail
and
service
establishment
regularly employing less than
ten workers.

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Ruling of the Labor Arbiter :

Dismissed complainants money claims for
lack of factual and legal basis since they
failed to support the allegation that their
employer is regularly employing more than
ten (10) workers in order to be covered of
the minimum wage law, or entitled to legal
holiday pay and SIL.
No sufficient factual basis to award
overtime pay and premium pay for holiday
and rest day because complainants failed to
substantiate that they rendered overtime
and during rest days.
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Ruling of the NLRC:

Modified

the ruling of the Labor

Arbiter by directing respondent to pay
complainants their salary differentials,
He who
holiday
pay, invokes
and SIL. the exemption of
the mandated wages and fringe benefits
has the burden of showing the basis of
the same .

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Ruling of the Court of Appeals:

Affirmed the resolution of the NLRC.
Having claimed exemption from the
coverage of the minimum wage laws or
order, it was incumbent upon respondent
to prove such claim.
Apart from simply denying complainants
allegation that it employs more than 24
workers in its business, respondent failed
to adduce evidence to prove that it is,
indeed, a retail establishment which
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ISSUE:
1) Whether or not complainants
are entitled to the money claims.

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For a retail/service establishment to

uling of the Supreme Court:
be exempted from the coverage of the
minimum wage law, it must be shown
that the establishment is regularly
employing not more than ten (10)
workers and had applied for exemptions
with and as determined by the
appropriate Regional Board.
Respondents had not shown any
evidence to show that they had applied
for such exemption and if they had
applied,
the
same>>was
granted.
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End.

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