Metrobank v.

National Wages and Productivity Commission (2007) (Across the board) Doctrine: Facts: On October 17, 1995, the Regional Tripartite Wages and Productivity Board, Region II, Tuguegarao, Cagayan (Board), by virtue of the Wage Rationalization Act, issued Wage Order R02-03. WO R02-03 grants an across-the-board increase of Php15.00 to all employees and workers in the private sector throughout Region II under Section 1 thereof. The Wage Order took effect on January 1, 1996, while its Implementing Rules were approved on February 14 of the same year. Under Section 13 of the Wage Order, any party aggrieved by it may file an appeal before the National Wages and Productivity Commission (NWPC), through the Board, within 10 calendar days from publication of the Wage Order. Two letter inquiries were sent to the NWPC. The first letter was sent by the Bankers Council for Personnel Management, seeking an exemption from the coverage of the Wage Order on behalf of its member banks with head offices outside of Region II. This request was grounded on the fact that such member banks were already paying more than the prevailing minimum rage rate in NCR, which is their principal place of business. The second letter was sent by petitioner Metrobank, asking for an interpretation of the applicability of the Wage Order. The NWPC replied to both letters. Both replies basically expressed that the Wage Order covers all establishments situated in Region II, regardless of their voluntary adoption of wage orders applicable in Metro Manila and irrespective of the amounts they are already paying their employees. This prompted Metrobank to file a petition for certiorari and prohibition with the CA. Metrobank claims that the Board, in issuing the Wage Order, acted beyond its authority. Thus, petitioner prays for the nullification of the Order as its implementation would cause financial losses and labor unrest. The OSG filed a manifestation siding with Metrobank. Despite this, the CA denied the petition because of three primary reasons. First, the writ of prohibition could no longer be issued since the Wage Order and its IRR have already become fait accompli (accomplished fact) because both have already taken effect. Second, the writ of certiorari is an improper remedy since such may only issue in relation to the exercise judicial and quasi-judicial functions, not administrative functions. Third, Metrobank did not utilize the right to appeal provided under Sec. 13 of the Wage Order. Issues: 1. W/N the Section 1 of the Wage Order is valid 2. W/N Metrobanks recourse to a petition for certiorari and prohibition was proper Held/Ratio: 1. Partly yes. In furtherance of the States policy to rationalize the fixing of minimum wages, the Wage Rationalization Act created the NWPC and vested it with the power to prescribe guidelines for the determination of appropriate minimum wages and authorized the Regional Boards to fix the minimum wage rates in their respective regions, provinces or industries. In ECOP v. NWPC, the Court declared that there are two ways of fixing the minimum wage - the floor wage method and the salary ceiling method. Under the floor wage method, a fixed amount is added to the prevailing statutory minimum wage rates. (i.e. Add Php 15.00 to the current minimum wage rates. If the employee is earning more than minimum wage, no need to add) On the other hand, in the salary ceiling method, a salary ceiling would be set, in such a way that only those below the ceiling would be entitled to an increase that would allow their current wages to reach the ceiling. (i.e. If ceiling is Php 250.00, those earning 200 will get a Php 50.00 increase, those earning Php 250.00 will not get an increase at all) Wage orders may not grant benefits not provided by the Wage Rationalization Act.

In the present case, the board did not fix the minimum wage using any of the two methods. Instead, it granted an across the board wage increase of Php 15.00 to all employees and workers of Region 2, whether earning minimum wage or not. In doing so, the Board exceeded its authority. The Wage Order effectively granted additional benefits not contemplated by the Wage Rationalization Act. It has been said that when the application of an administrative issuance modifies existing laws or exceeds the intended scope, as in this case, the issuance becomes void, not only for being ultra vires, but also for being unreasonable. Thus, the Court finds that Sec. 1, Wage Order No. R02-03 is void insofar as it grants a wage increase to employees earning more than the minimum wage rate; and pursuant to the separability clause of the Wage Order, Sec. 1 is declared valid with respect to employees earning the prevailing minimum wage rate. Be that as it may, the Court no longer ordered the employees who wrongly received the increase mandated by the Wage Order to refund the amounts received by them since they received the increase in good faith, in the honest belief that they were entitled to it. 2. No. A petition for certiorari and prohibition was not the proper remedy. The issuance of the Wage Order was done in pursuance of the Boards quasi-legislative or rulemaking power as delegated by the Wage Rationalization Act. Thus, it is not the proper subject of a petition certiorari or prohibition because both special civil actions may only be resorted to if the disputed acts are performed in the exercise of judicial or quasi-judicial power. In addition, Metrobank should have availed of the remedy provided by Sec. 13 of the Wage Order. To make matters worse, Metrobank failed to invoke the power of the NWPC to review the wage levels set by the Board. Instead, it went to the CA right away, wrongly impleading NWPC. Metrobank failed to exhaust the administrative remedies available to it. *Also noteworthy is the fact that the Court dismissed the respondents claim that the issues raised have become moot as the Order and its IRR have already taken effect. The SC noted that such implementation does not in any way render the case moot, since the issue of the validity of the Order subsists even after implementation.