Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-12444 February 28, 1963
STTES MR!NE CORPORT!ON a"# RO$L L!NE, !NC., petitioners,
vs.
CE%U SEMEN&S SSOC!T!ON, !NC., respondent.
Pedro B. Uy Calderon for petitioners.
Gaudioso C. Villagonzalo for respondent.
PRE'ES, J.:
Petitioners States Marine Corporation and Royal Line, nc. !ere en"a"ed in the
business of #arine coast!ise transportation, e#ployin" therein several stea#ships of
Philippine re"istry. $hey had a collective bar"ainin" contract !ith the respondent Cebu
Sea#en%s Association, nc. &n Septe#ber '(, ')*(, the respondent union filed !ith the
Court of ndustrial Relations +CR,, a petition +Case No. -./01, a"ainst the States
Marine Corporation, later a#ended on May ., ')*2, by includin" as party respondent,
the petitioner Royal Line, nc. $he 3nion alle"ed that the officers and #en !or4in" on
board the petitioners% vessels have not been paid their sic4 leave, vacation leave and
overti#e pay5 that the petitioners threatened or coerced the# to accept a reduction of
salaries, observed by other shipo!ners5 that after the Mini#u# 6a"e La! had ta4en
effect, the petitioners re7uired their e#ployees on board their vessels, to pay the su# of
P../ for every #eal, !hile the #asters and officers !ere not re7uired to pay their #eals
and that because Captain Carlos Asensi had refused to yield to the "eneral reduction of
salaries, the petitioners dis#issed said captain !ho no! clai#s for reinstate#ent and
the pay#ent of bac4 !a"es fro# 8ece#ber (*, ')*(, at the rate of P*././/, #onthly.
$he petitioners% shippin" co#panies, ans!erin", averred that very #uch belo! 2/ of the
#en and officers in their e#ploy !ere #e#bers of the respondent union5 that the !or4
on board a vessel is one of co#parative ease5 that petitioners have suffered financial
losses in the operation of their vessels and that there is no la! !hich provides for the
pay#ent of sic4 leave or vacation leave to e#ployees or !or4ers of private fir#s5 that
as re"ards the clai# for overti#e pay, the petitioners have al!ays observed the
provisions of Co##. Act No. ..., +Ei"ht09our Labor La!,, not!ithstandin" the fact that
it does not apply to those !ho provide #eans of transportation5 that the shipo!ners and
operators in Cebu !ere payin" the salaries of their officers and #en, dependin" upon
the #ar"in of profits they could reali:e and other factors or circu#stances of the
business5 that in enactin" Rep. Act No. ;/( +Mini#u# 6a"e La!,, the Con"ress had in
#ind that the a#ount of P../ per #eal, furnished the e#ployees should be deducted
fro# the daily !a"es5 that Captain Asensi !as not dis#issed for alle"ed union activities,
but !ith the e<piration of the ter#s of the contract bet!een said officer and the
petitioners, his services !ere ter#inated.
A decision !as rendered on =ebruary (', ')*- in favor of the respondent union. $he
#otion for reconsideration thereof, havin" been denied, the co#panies filed the present
!rit of certiorari, to resolve le"al 7uestion involved. Al!ays bearin" in #ind the deep0
rooted principle that the factual findin"s of the Court of ndustrial Relations should not
be disturbed, if supported by substantial evidence, the different issues are ta4en up, in
the order they are raised in the brief for the petitioners.
'. First assignment of error. > $he respondent court erred in holdin" that it had
?urisdiction over case No. -./01, not!ithstandin" the fact that those !ho had dispute
!ith the petitioners, !ere less than thirty +2/, in nu#ber.
$he CR #ade a findin" that at the ti#e of the filin" of the petition in case No. -./01,
respondent 3nion had #ore than thirty #e#bers actually !or4in" !ith the co#panies,
and the court declared itself !ith ?urisdiction to ta4e co"ni:ance of the case. A"ainst this
order, the herein petitioners did not file a #otion for reconsideration or a petition for
certiorari. $he findin" of fact #ade by the CR beca#e final and conclusive, !hich 6e
are not no! authori:ed to alter or #odify. t is a<io#atic that once the CR had ac7uired
?urisdiction over a case, it continues to have that ?urisdiction, until the case is ter#inated
+Manila 9otel E#p. Association v. Manila 9otel Co#pany, et al., ./ &.@. No. ;, p.
2/(-,. t !as abundantly sho!n that there !ere *; #e#bers !ho si"ned E<hibits A, A0
to A0A, and that '/2 #e#bers of the 3nion are listed in E<hibits B, B0' to B02*, =, =0'
and B0( to B02. So that at the ti#e of the filin" of the petition, the respondent union had
a total #e#bership of '*), !or4in" !ith the herein petitioners, !ho !ere presu#ed
interested in or !ould be benefited by the outco#e of the case +NAMARC& v. CR, L0
'-A/., Can. ');2,. Anne< 8, +&rder of the CR, dated March A, ')*.,, li4e!ise belies
the contention of herein petitioner in this re"ard. $he fact that only - clai#ed for
overti#e pay and only - !itnesses testified, does not !arrant the conclusion that the
e#ployees !ho had so#e dispute !ith the present petitioners !ere less than 2/. $he
rulin" of the CR, !ith respect to the 7uestion of ?urisdiction is, therefore, correct.
(. Second assignment of error. > $he CR erred in holdin", that inas#uch as in the
shippin" articles, the herein petitioners have bound the#selves to supply the cre! !ith
provisions and !ith such Ddaily subsistence as shall be #utually a"reed uponD bet!een
the #aster and the cre!, no deductions for #eals could be #ade by the aforesaid
petitioners fro# their !a"es or salaries.
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2. Third assignment of error. > $he CR erred in holdin" that inas#uch as !ith re"ard
to #eals furnished to cre! #e#bers of a vessel, section 2+f, of Act No. ;/( is the
"eneral rule, !hich section ') thereof is the e<ception, the cost of said #eals #ay not
be le"ally deducted fro# the !a"es or salaries of the aforesaid cre! #e#bers by the
herein petitioners.
.. Fourth assignment of error. > $he CR erred in declarin" that the deduction for costs
of #eals fro# the !a"es or salaries after Au"ust ., ')*', is ille"al and sa#e should be
rei#bursed to the e#ployee concerned, in spite of said section 2, par. +f, of Act No. ;/(.
t !as sho!n by substantial evidence, that since the be"innin" of the operation of the
petitioner%s business, all the cre! of their vessels have been si"nin" Dshippin" articlesD
in !hich are stated opposite their na#es, the salaries or !a"es they !ould receive. All
sea#en, !hether #e#bers of the cre! or dec4 officers or en"ineers, have been
furnished free #eals by the ship o!ners or operators. All the shippin" articles si"ned by
the #aster and the cre! #e#bers, contained, a#on" others, a stipulation, that Din
consideration of !hich services to be duly perfor#ed, the said #aster hereby a"rees to
pay to the said cre!, as !a"es, the su#s a"ainst their na#es respectively e<pressed in
the contract5 and to supply them with proisions as provided herein ...D +Sec. A, par. EbF,
shippin" articles,, and durin" the duration of the contract Dthe #aster of the vessel !ill
provide each #e#ber of the cre! such daily su!sistence as shall be #utually a"reed
daily upon bet!een said #aster and cre!5 or, in lieu of such subsistence the cre! #ay
reserve the ri"ht to de#and at the ti#e of e<ecution of these articles that ade7uate daily
rations be furnished each #e#ber of the cre!.D +Sec. A, par. EeF, shippin" articles,. t is,
therefore, apparent that, aside fro# the pay#ent of the respective salaries or !a"es,
set opposite the na#es of the cre! #e#bers, the petitioners bound the#selves to
supply the cre! !ith ship%s provisions, daily subsistence or daily rations, !hich include
food.
$his !as the situation before Au"ust ., ')*', !hen the Mini#u# 6a"e La! beca#e
effective. After this date, ho!ever, the co#panies be"an deductin" the cost of #eals
fro# the !a"es or salaries of cre! #e#bers5 but no such deductions !ere #ade fro#
the salaries of the dec4 officers and en"ineers in all the boats of the petitioners. 3nder
the e<istin" la!s, therefore, the 7uery conver"es on the le"ality of such deductions.
6hile the petitioners herein contend that the deductions are le"al and should not be
rei#bursed to the respondent union, the latter, ho!ever, clai#s that sa#e are ille"al
and rei#burse#ent should be #ade.
6herefore, the parties respectfully pray that the fore"oin" stipulation of facts be
ad#itted and approved by this 9onorable Court, !ithout pre?udice to the parties
adducin" other evidence to prove their case not covered by this stipulation of facts.
"#wph$".%&t
6e hold that such deductions are not authori:ed. n the coast!ise business of
transportation of passen"ers and frei"ht, the #en !ho co#pose the co#ple#ent of a
vessel are provided !ith free #eals by the shipo!ners, operators or a"ents, because
they hold on to their !or4 and duties, re"ardless of Dthe stress and strain conco#itant of
a bad !eather, un#indful of the dan"ers that lur4 ahead in the #idst of the hi"h seas.D
Section 2, par. f, of the Mini#u# 6a"e La!, +R.A. No. ;/(,, provides as follo!s >
+f, 3ntil and unless investi"ations by the Secretary of Labor on his initiative or on
petition of any interested party result in a different deter#ination of the fair and
reasonable value, the furnishing of meals shall be valued at not #ore than thirty
centavos per #eal for a"ricultural e#ployees and not more than forty centavos for any
other e#ployees covered by this Act, and the furnishin" of housin" shall be valued at
not #ore than t!enty centavos daily for a"ricultural !or4ers and not #ore than forty
centavos daily for other e#ployees covered by this Act.
Petitioners #aintain, in vie! of the above provisions, that in fi<in" the #ini#u# !a"e of
e#ployees, Con"ress too4 into account the #eals furnished by e#ployers and that in
fi<in" the rate of forty centavos per #eal, the la!#a4ers had in #ind that the latter
a#ount should be deducted fro# the daily !a"e, other!ise, no rate for #eals should
have been provided.
9o!ever, section '), sa#e la!, states >
SEC. '). 'elations to other la!or laws and practices.> Nothin" in this Act shall deprive
an e#ployee of the ri"ht to see4 fair !a"es, shorter !or4in" hours and better !or4in"
conditions nor (ustify an employer in violatin" any other labor la! applicable to his
employees) in reducing the wage now paid to any of his employees in e*cess of the
minimum wage esta!lished under this +ct) or in reducing supplements furnished on the
date of enactment.
At first blush, it !ould appear that there e<ists a contradiction bet!een the provisions of
section 2+f, and section ') of Rep. Act No. ;/(5 but fro# a careful e<a#ination of the
sa#e, it is evident that Section 2+f, constitutes the "eneral rule, !hile section ') is the
e<ception. n other !ords, if there are no supple#ents "iven, !ithin the #eanin" and
conte#plation of section '), but #erely facilities, section 2+f, "overns. $here is no
conflict5 the t!o provisions could, as they should be har#oni:ed. And even if there is
such a conflict, the respondent CR should resolve the sa#e in favor of the safety and
decent livin" laborers +Art. '-/(, ne! Civil Code,..
t is ar"ued that the food or #eals "iven to the dec4 officers, #arine en"ineers and
unlicensed cre! #e#bers in 7uestion, !ere #ere DfacilitiesD !hich should be deducted
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fro# !a"es, and not Dsupple#entsD !hich, accordin" to said section '), should not be
deducted fro# such !a"es, because it is provided thereinG DNothin" in this Act shall
deprive an e#ployee of the ri"ht to such fair !a"e ... or in reducin" supple#ents
furnished on the date of enact#ent.D n the case of Ato40Bi" 6ed"e Assn. v. Ato40Bi"
6ed"e Co., L0-2.), Culy '), ')**5 *' &.@. 2.2(, the t!o ter#s are defined as follo!s
>
DSupple#entsD, therefore, constitute e<tra re#uneration or special privile"es or benefits
"iven to or received by the laborers oer and a!oe their ordinary earnings or wages.
D=acilitiesD, on the other hand, are ite#s of e<pense necessary for the laborer%s and his
fa#ily%s e<istence and subsistence so that by e<press provision of la! +Sec. (E"F,, they
for# part of the !a"e and !hen furnished by the e#ployer are deductible therefro#,
since if they are not so furnished, the laborer !ould spend and pay for the# ?ust the
sa#e.
n short, the benefit or privile"e "iven to the e#ployee !hich constitutes an e<tra
re#uneration above and over his basic or ordinary earnin" or !a"e, is supple#ent5 and
!hen said benefit or privile"e is part of the laborers% basic !a"es, it is a facility. $he
criterion is not so #uch !ith the 4ind of the benefit or ite# +food, lod"in", bonus or sic4
leave, "iven, but its purpose. Considerin", therefore, as definitely found by the
respondent court that the #eals !ere freely "iven to cre! #e#bers prior to Au"ust .,
')*', !hile they !ere on the hi"h seas Dnot as part of their !a"es but as a necessary
#atter in the #aintenance of the health and efficiency of the cre! personnel durin" the
voya"eD, the deductions therein #ade for the #eals "iven after Au"ust ., ')*', should
be returned to the#, and the operator of the coast!ise vessels affected should continue
"ivin" the sa#e benefit..
n the case of Ce!u +uto!us Company . United Ce!u +uto!us ,mployees +ssn.) -.
/012) 3ct. 20) "/44, the co#pany used to pay to its drivers and conductors, !ho !ere
assi"ned outside of the City li#its, aside fro# their re"ular salary, a certain percenta"e
of their daily !a"e, as allo!ance for food. 3pon the effectivity of the Mini#u# 6a"e
La!, ho!ever, that privile"e !as stopped by the co#pany. $he order CR to the
co#pany to continue "rantin" this privile"e, !as upheld by this Court.
$he shippin" co#panies ar"ue that the furnishin" of #eals to the cre! before the
effectivity of Rep. Act No. ;/(, is of no #o#ent, because such circu#stance !as
already ta4en into consideration by Con"ress, !hen it stated that D!a"eD includes the
fair and reasonable value of boards custo#arily furnished by the e#ployer to the
e#ployees. f 6e are to follo! the theory of the herein petitioners, then a cre! #e#ber,
!ho used to receive a #onthly !a"e of P'//.//, before Au"ust ., ')*', !ith no
deduction for #eals, after said date, !ould receive only PA;.// #onthly +after deductin"
the cost of his #eals at P../ per #eal,, !hich !ould be very #uch less than the
P'((.// #onthly #ini#u# !a"e, fi<ed in accordance !ith the Mini#u# 6a"e La!.
nstead of benefitin" hi#, the la! !ill adversely affect said cre! #e#ber. Such
interpretation does not confor# !ith the avo!ed intention of Con"ress in enactin" the
said la!.
&ne should not overloo4 a fact fully established, that only unlicensed cre! #e#bers
!ere #ade to pay for their #eals or food, !hile the dec4 officers and #arine en"ineers
receivin" hi"her pay and provided !ith better victuals, !ere not. $his pictures in no
uncertain ter#s, a "reat and un?ust discri#ination obtainin" in the present case
+Pa#bu?an Sur 3nited Mine 6or4ers v. CR, et al., L0-'--, May 2', ')**,.
Fifth) Si*th and Seenth assignments of error.> $he CR erred in holdin" that Severino
Pepito, a boats#an, had rendered overti#e !or4, not!ithstandin" the provisions of
section ', of C.A. No. ...5 in basin" its findin" ofthe alle"ed overti#e, on the
uncorroborated testi#ony of said Severino Pepito5 and in orderin" the herein petitioners
to pay hi#. Severino Pepito !as found by the CR to have !or4ed overti#e and had not
been paid for such services. Severino Pepito cate"orically stated that he !or4ed durin"
the late hours of the evenin" and durin" the early hours of the day !hen the boat doc4s
and unloads. Aside fro# the above, he did other ?obs such as re#ovin" rusts and
cleanin" the vessel, !hich overti#e !or4 totalled to ; hours a day, and of !hich he has
not been paid as yet. $his state#ent !as not rebutted by the petitioners. Nobody
!or4in" !ith hi# on the sa#e boat DMH1 AdrianaD contra!ise. $he testi#onies of
boats!ains of other vessels+MH1 runa and MH1 Princesa,, are inco#petent and
unreliable. And considerin" the established fact that the !or4 of Severino Pepito !as
continuous, and durin" the ti#e he !as not !or4in", he could not leave and could not
co#pletely rest, because of the place and nature of his !or4, the provisions of sec. ', of
Co##. Act No. ..., !hich states D6hen the !or4 is not continuous, the ti#e durin"
!hich the laborer is not !or4in" and can leave his !or4in" place and can rest
co#pletely shall not be countedD, find no application in his case.
A. ,ighth assignment of error.> $he CR erred in orderin" petitioners to reinstate Capt.
Carlos Asensi to his for#er position, considerin" the fact that said officer had been
e#ployed since Canuary ), ')*2, as captain of a vessel belon"in" to another shippin"
fir# in the City of Cebu.
$he CR held >
=indin" that the clai#s of Captain Carlos Asensi for bac4 salaries fro# the ti#e of his
alle"ed lay0off on March (/, ')*(, is not supported by the evidence on record, the sa#e
is hereby dis#issed. Considerin", ho!ever, that Captain Asensi had been laid0off for a
lon" ti#e and that his failure to report for !or4 is not sufficient cause for his absolute
dis#issal, respondents are hereby ordered to reinstate hi# to his for#er ?ob !ithout
bac4 salary but under the sa#e ter#s and conditions of e#ploy#ent e<istin" prior to his
lay0off, !ithout loss of seniority and other benefits already ac7uired by hi# prior to
3
March (/, ')*(. $his Court is e#po!ered to reduce the punish#ent #eted out to an
errin" e#ployee +Standard 1acuu# &il Co., nc. v. Batipunan Labor 3nion, @.R. No. L0
);;;, Can. 2/, ')*-,. $his step ta4en is in consonance !ith section '( of Co##. Act
'/2, as a#ended.D +p. ';, 8ecision, Anne< %@%,.
$he rulin" is in confor#ity !ith the evidence, la! and e7uity.
5inth and Tenth assignments of error. > $he CR erred in denyin" a duly verified
#otion for ne! trial, and in overrulin" petitioner%s #otion for reconsideration.
$he #otion for ne! trial, supported by an affidavit, states that the #ovants have a "ood
and valid defense and the sa#e is based on three orders of the 6AS +6a"e
Ad#inistration Service,, dated Nove#ber ;, ')*;. t is alle"ed that they !ould inevitably
affect the defense of the petitioners. $he #otion for ne! trial is !ithout #erit. 9avin" the
said !a"e &rders in their possession, !hile the case !as pendin" decision, it !as not
e<plained !hy the proper #ove !as not ta4en to introduce the# before the decision
!as pro#ul"ated. $he said !a"e orders, dealin" as they do, !ith the ealuation of
meals and facilities, are irrelevant to the present issue, it havin" been found and held
that the #eals or food in 7uestion are not facilities but supple#ents. $he ori"inal petition
in the CR havin" been filed on Sept. '(, ')*(, the 6AS could have intervened in the
#anner provided by la! to e<press its vie!s on the #atter. At any rate, the ad#ission of
the three !a"e orders have not altered the decision reached in this case.
N 1E6 9ERE&=, the petition is dis#issed, !ith costs a"ainst the petitioners.
Bengzon) C.6.) Padilla) Bautista +ngelo) -a!rador) Concepcion) 'eyes) 6.B.-.) Barrera)
7izon) 'egala and 8a9alintal) 66.) concur.
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