G.R. No.

L-60403 August 3, 1983

ALLIANCE
OF
GOVERNMENT
WORKERS
(AGW);
PNB-FEMA
BANK
EMPLOYEESASSOCIATION (AGW); KAISAHAN AT KAPATIRAN NG
MGA
MANGAGAWA AT KAWANING MWSS (AGW); BALARA EMPLOYEES ASSOCIATION
(AGW); GSIS WORKERSASSOCIATION (AGW); SSS EMPLOYEES ASSOCIATION
(AGW); PVTA EMPLOYEESASSOCIATION (AGW); NATIONAL ALLIANCE OF
TEACHERS AND OFFICE WORKERS(AGW); , petitioners,
vs.
THE HONORABLE MINISTER OF LABOR and EMPLOYMENT, PHILIPPINE
NATIONALBANK (PNB); METROPOLITAN WATERWORKS and SEWERAGE SYSTEM
(MWSS);GOVERNMENT SERVICE INSURANCE SYSTEM (GSIS); SOCIAL SECURITY
SYSTEM(SSS); PHILIPPINE VIRGINIA TOBACCO ADMINISTRATION (PVTA)
PHILIPPINE NORMALCOLLEGE (PNC); POLYTECHNIC UNIVERSITY OF THE
PHILIPPINES (PUP), respondents.
GUTIERREZ, JR., J.:
Facts:

According to the petitioners, P.D. No. 851 requires all employers to pay the 13th-month
pay totheir employees with one sole exception found in Section 2 which states that
"Employersalready paying their employees a 13th month pay or its equivalent are not
covered by thisDecree."
The
petitioners
contend
that
Section
3
of
the
Rules and
Regulations
ImplementingPresidential Decree No. 851 included other types of employers not exempted
by the decree.They state that nowhere in the decree is the secretary, now Minister of
Labor and Employment,authorized to exempt other types of employers from the
requirement.
Section 3 of the Rules and Regulations Implementing Presidential Decree No. 851
provides:Section 3. Employers covered The Decree shall apply to all employers
exceptto:
a) Distressed employers, such as
(1) those which are currently incurringsubstantial losses or
(2) in the case of non-profit institutions and organizations,where their income,
whether
from donations, contributions, grants and other earnings from any source,
has
consistently declined by more than forty (40%) per cent of their normal income for
the
last two (2) )years, subject to the provision of Section 7 of this issuance.
b) The Government and any of its political subdivisions, including government-owned and
controlled corporations, except)t those corporation, operatingessentially as private,
,subsidiaries of the government;
c) Employers already paying their employees 13th-month pay or more in acalendar year or
its equivalent at the of this issuance;
d) Employers of household helpers and persons in the personal service of another in
relation to such workers: and
e) Employers of those who are paid on purely commission, boundary, or taskbasis and
those who are paid a fixed for performing a specific work, irrespectiveof the time
consumed in the performance thereof, except where the workers arepaid an piece- rate

basis in which case the employer shall be covered by thisissuance :insofar as such workers
are concerned ...
The petitioners assail this rule as ultra vires and void. Citing Philippine Apparel
Workers'Unionv.NIRC et al., (106 SCRA 444); Teoxon v. Members of the Board of'
Administators (33 SCRA585); Santos u. Hon. Estenzo et al., (109 Phil. 419); Hilado u.
Collector of Internal Revenue(100 Phil. 288), and Olsen & Co. Inc. v. Aldanese and Trinidad
(43 Phil. 259), the petitionersargue that regulations adopted under legislative authority
must be in harmony with theprovisions of the law and for the sole purpose of carrying into
effect its general provisions.
Theystate that a legislative act cannot be amended by a rule and an administrative officer
cannotchange the law. Section 3 is challenged as a substantial modification by rule of a
PresidentialDecree and an unlawful exercise of legislative power.

Issue:
WON the branches, agencies, subdivisions, and instrumentalities of the Government,including
government owned or controlled corporations included among the 4 "employers" under
Presidential Decree No. 851 which are required to pay an their employees receiving abasic salary
of not more than P1,000.00 a month, a thirteenth (13th) month pay not later thanDecember 24
of every year.
Held:

The Solicitor General states:"Presidential Decree No. 851 is a labor standard law which
requires covered employers to paytheir employees receiving not more than P1,000.00 a
month an additional thirteenth-month pay.
Its purpose is to increase the real wage of the worker (Marcopper Mining Corp. v. Ople,
105SCRA 75; and National Federation of Sugar Workers v. Ovejera, G.R. No. 59743, May
31,1982) as explained in the'whereas'clause which read:
WHEREAS, it is necessary to further protect the level of realwages from the ravage of
world-wide inflation;
WHEREAS, there has been no increase in the legal minimum wage rates since 1970;
WHEREAS, the Christmas season is an opportune time for society to show its concern for
the plight of the working masses sothey may celebrate the Christmas and New
Year.xxxxxxxxx
What the P.D. No. 851 intended to cover, as explained in the prefatory statementof the
Decree, are only those in the private sector whose real wages requireprotection from
world-wide inflation. This is emphasized by the "whereas" clausewhich states that 'there
has been no increase in the legal minimum wage ratessince 1970'.
This could only refer to the private sector, and not to those in thegovernment service
because at the time of the enactment of Presidential Decree No. 851 in 1975, only the
employees in the private sector had not been given anyincrease in their minimum wage.
The employees in the government service hadalready been granted in 1974 a ten percent
across-the-board increase on their salaries as stated in P.D. No. 525, Section 4.
Moreover, where employees in the government service were to benefit from labor
standard laws, their coverage is explicitly stated in the statute or presidentialenactment.
This is evident in
(a) Presidential Decree No. 390, Sec. 1 whichgranted emergency cost of living allowance to
employees in the nationalgovernment;
(b) Republic Act No. 6111, Sec. 10 on medicare benefits;

(c)Presidential Decree No -442, Title II, Article 97 on the applicable minimum wagerates;
(d) Presidential Decree No. 442, Title 11, Article 167 (g) on workmen'scompensation;
(e) Presidential Decree No. 1123 which provides for increases inemergency allowance to
employees in the private sector and in salary togovernment employees in Section 2
thereof; and
(f) Executive Order No. 752granting government employees a year-end bonus equivalent
to one week's pay.

Thus, had the intention been to include government employees under thecoverage of
Presidential Decree No. 851, said Decree should have expressly soprovided and there
should have been accompanying yearly appropriationmeasures to implement the same.
That no such express provision was providedand no accompanying appropriation measure
to was passed clearly show theintent to exclude government employees from the
coverage of P. D. No. 85 1.
We agree.It is an old rule of statutory construction that restrictive statutes and acts which
impose burdenson the public treasury or which diminish rights and interests, no matter
how broad their terms donot embrace the Sovereign, unless the Sovereign is specifically
mentioned. (See Dollar SavingsBank v. United States, 19 Wall (U.S.) 227; United States v.
United Mine Workers of America,330 U.S. 265).
The Republic of the Philippines, as sovereign, cannot be covered by a generalterm like
"employer" unless the language used in the law is clear and specific to that effect.
WHEREFORE, the petition is hereby DISMISSED for lack of merit.

GOLD CITY INTEGRATED PORT SERVICES, INC. VS. NLRC189 SCRA

811
FACTS

1.
Private respondent Jose Bacalso was employed as an admeasurer by petitionerGold
City.
2.
He was suspected by management of undermeasuring cargo. Hence, the
cargocontrol officer ordered two other admeasurers to re-measure three pallets ofbananas
which had already been measured by private respondent.
3.
As it turned out, the re-measurement revealed that respondent had undermeasuredthe bananas by 1.427 cubic meters.
4.
Feeling insulted by the re-measurement, private respondent confronted
andquarreled with Mabalacad, on of the two admeasurers, in the office of ChiefAdmeasurer
Guangco. Guangco told the two to stop fighting and behave properly butthis order was
ignored and a fistfight ensued.
5.
Thereafter, private respondent was charged with assaulting a co-employee
andfalsifying reports and records of the company. He was then preventively
suspendedpending investigation of the grievance committee.
6.
The committee recommended a forty-five day suspension but apparently,
Guancoand Mabalacad did not consider suspension an adequate sanction.
7.
Subsequently, private respondent received a notice of termination upon the
groundsof assaulting a co-employee and of insubordination.
8.
Private respondent filed a complaint for illegal dismissal with the Labor Arbiter,
whichgranted such motion but did not order respondents reinstatement.

9.

On appeal, the NLRC modified the ruling of the Labor Arbiter.

ISSUE
1.
Whether or not private respondent was denied due process in the course of his
dismissal.
2.
Whether or not private respondent was dismissed for a just cause.
HELD

It must be noted that petitioner did not properly inform private respondent of all
theinfractions of company regulations which subsequently became the justification for
hisdismissal.
After being preventively suspended, he was charged with assaulting a co-employee and
falsifying reports and records of the company relating to his duties. But itcame to pass that
when private respondent received his notice of termination, the causestherefor were
stated as assault on a co-employee and insubordination.
The Court considersthat there was here at least a partial deprivation of private
respondents right to proceduraldue process. He could not be expected adequately to
defend himself as he was not fully orcorrectly informed of the charges against him which
management intend to prove.
It is lessthan fair for management to charge an employee with one offense and then to
dismiss himfor having committed another offense with which he had not been charged
against andwhich he was therefore unable adequately to defend himself.
Willful disobedience of the employers lawful orders, as a just cause for the dismissal of
anemployee, envisages the concurrence of at least two requisites: that the
employeesassailed conduct must have been willful or intentional, the willfulness being
characterized bya wrongful and perverse attitude; and the order violated must have
been reasonable,lawful, made known to the employee and must pertain to the duties
which he had beenengaged to discharge.
Both requisites are present in the instant case. It does not follow,however, that private
respondents services were lawfully terminated. We believe that notevery case of
insubordination id reasonably penalized with dismissal.For one thing, Article 282 (a) of the
Labor Code refers to serious misconduct or willfuldisobedience. There must be reasonably
proportionality between the willful disobedience bythe employee and the penalty imposed
therefor.