Petitioners' position was that in arriving at the correct and legal amount of separation pay due them, whether

under
the Labor Code or the CBA, their basic salary, earned sales commissions and allowances should be added together.
They cited Article 97(f) of the Labor Code which includes commission as part on one's salary, to wit;
(f) 'Wage' paid to any employee shall mean the remuneration or earnings, however designated, capable of being
expressed in terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other
method of calculating the same, which is payable by an employer to an employee under a written or unwritten
contract of employment for work done or to be done, or for services rendered or to be rendered, and includes the fair
and reasonable value, as determined by the Secretary of Labor, of board, lodging, or other facilities customarily
furnished by the employer to the employee. 'Fair reasonable value' shall not include any profit to the employer or to
any person affiliated with the employer.
We ruled that "in the computation of backwages and separation pay, account must be taken not only of the basic
salary of petitioner but also of her transportation and emergency living allowances." This ruling was reiterated
in Soriano v. NLRC, et al.,
From the aforequoted provisions of the law and the implementing rules, it could be deduced that wage is used in its
generic sense and obviously refers to the basic wage rate to be ascertained on a time, task, piece or commission
basis or other method of calculating the same. It does not, however, mean that commission, allowances or analogous
income necessarily forms part of the employee's salary because to do so would lead to anomalies (sic), if not absurd,
construction of the word "salary." For what will prevent the employee from insisting that emergency living allowance,
13th month pay, overtime, and premium pay, and other fringe benefits should be added to the computation of their
separation pay. This situation, to our mind, is not the real intent of the Code and its rules.but SC ruled otherwise.
The final consideration is, in carrying out and interpreting the Labor Code's provisions and its implementing
regulations, the workingman's welfare should be the primordial and paramount consideration. This kind of
interpretation gives meaning and substance to the liberal and compassionate spirit of the law as provided for in
Article 4 of the Labor Code which states that "all doubts in the implementation and interpretation of the provisions of
the Labor Code including its implementing rules and regulations shall be resolved in favor of labor" (Abella v. NLRC,
ALIPIO R. RUGA, JOSE PARMA, ELADIO CALDERON, LAURENTE BAUTU, JAIME BARBIN, NICANOR
FRANCISCO, PHILIP CERVANTES and ELEUTERIO BARBIN, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION and DE GUZMAN FISHING ENTERPRISES and/or ARSENIO DE
GUZMAN, respondents
Facts:
Petitioners were the fishermen-crew members of 7/B Sandyman II, one of several fishing vessels owned and
operated by private respondent De Guzman Fishing Enterprises which is primarily engaged in the fishing business
with port and office at Camaligan, Camarines Sur. Petitioners rendered service aboard said fishing vessel in various
capacities, as follows: Alipio Ruga and Jose Parma patron/pilot; Eladio Calderon, chief engineer; Laurente Bautu,
second engineer; Jaime Barbin, master fisherman; Nicanor Francisco, second fisherman; Philip Cervantes and
Eleuterio Barbin, fishermen.
For services rendered in the conduct of private respondent's regular business of "trawl" fishing, petitioners were paid
on percentage commission basis in cash by one Mrs. Pilar de Guzman, cashier of private respondent. As agreed
upon, they received thirteen percent (13%) of the proceeds of the sale of the fish-catch if the total proceeds
exceeded the cost of crude oil consumed during the fishing trip, otherwise, they received ten percent (10%) of the
total proceeds of the sale. The patron/pilot, chief engineer and master fisherman received a minimum income of
P350.00 per week while the assistant engineer, second fisherman, and fisherman-winchman received a minimum
income of P260.00 per week.
On September 11, 1983 upon arrival at the fishing port, petitioners were told by Jorge de Guzman, president of
private respondent, to proceed to the police station at Camaligan, Camarines Sur, for investigation on the report that
they sold some of their fish-catch at midsea to the prejudice of private respondent. Petitioners denied the charge
claiming that the same was a countermove to their having formed a labor union and becoming members of Defender
of Industrial Agricultural Labor Organizations and General Workers Union (DIALOGWU) on September 3, 1983.
During the investigation, no witnesses were presented to prove the charge against petitioners, and no criminal
charges were formally filed against them.
Notwithstanding, private respondent refused to allow petitioners to return to the fishing vessel to resume their work
on the same day, September 11, 1983.
On September 22, 1983, petitioners individually filed their complaints for illegal dismissal and non-payment of 13th
month pay, emergency cost of living allowance and service incentive pay, with the then Ministry (now Department) of
Labor and Employment, Regional Arbitration Branch No. V, Legaspi City, Albay. They uniformly contended that they
were arbitrarily dismissed without being given ample time to look for a new job.
Issue:

Whether or not the fishermen-crew members of the trawl fishing vessel 7/B Sandyman II are employees of its owneroperator, De Guzman Fishing Enterprises.
Ruling:
Disputing the finding of public respondent that a "joint fishing venture" exists between private respondent and
petitioners, petitioners claim that public respondent exceeded its jurisdiction and/or abused its discretion when it
added facts not contained in the records when it stated that the pilot-crew members do not receive compensation
from the boat-owners except their share in the catch produced by their own efforts; that public respondent ignored
the evidence of petitioners that private respondent controlled the fishing operations; that public respondent did not
take into account established jurisprudence that the relationship between the fishing boat operators and their crew is
one of direct employer and employee.
We have consistently ruled that in determining the existence of an employer-employee relationship, the elements that
are generally considered are the following (a) the selection and engagement of the employee; (b) the payment of
wages; (c) the power of dismissal; and (d) the employer's power to control the employee with respect to the means
and methods by which the work is to be accomplished. 8 The employment relation arises from contract of hire,
express or implied. 9 In the absence of hiring, no actual employer-employee relation could exist.
From the four (4) elements mentioned, we have generally relied on the so-called right-of-control test where the
person for whom the services are performed reserves a right to control not only the end to be achieved but also the
means to be used in reaching such end. The test calls merely for the existence of the right to control the manner of
doing the work, not the actual exercise of the right.
The petition is GRANTED. The questioned resolution of the National Labor Relations Commission dated May
30,1985 is hereby REVERSED and SET ASIDE. Private respondent is ordered to reinstate petitioners to their former
positions or any equivalent positions with 3-year backwages and other monetary benefits under the law. No
pronouncement as to costs.
State marine corp vs. cebu seamens association
Facts: The petitioners were engaged in the business of marine coastwise transportation. They had a CBA with the
Cebu Seamens Association. On September 12, 1952, the respondent union filed a complaint against the petitioners
alleging that the officers and men working on board the petitioners vessels have not been paid their sick leave,
vacation leave and overtime pay; that the petitioners threatened then to accept the reduction of salaries, observed by
other shipowners; that after the Minimum Wage Law had taken effect, the petitioners required their employees on
board their vessels, to pay the sum of P0.40 for every meal, while the masters and officers were required to pay their
meals and that because the captain had refused to yield to the general reduction of salaries, the petitioners
dismissed the captain. The petitioner, on their defense, stated that they have suffered a financial losses in the
operation of their vessels and there is no law which provides for the payment of sick leave or vacation leave to
employees of private firms; that with regards to their overtime pay, they have always observed the Eight-hour labor
Law and that overtime does not apply to those who provide means of transportation. The decision ruled in favor of
the respondent union. Hence, this petition.
Issue: Whether or not the required meals which the petitioner company deducted from the salary of the employees is
considered as facilities, and not supplements.
Held: Supplements constitute extra remuneration or special privileges or benefits given to or received by
the laborers over and above their ordinary earnings or wages. Facilities, on the other hand, are items of expense
necessary for the laborers and his familys existence and subsistence so that by express provisions of law, they form
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 them just the same. It is argued that the food or meal given to the deck officers, marine
engineers and unlicensed crew members in question, were mere facilities which should be deducted from wages,
and not supplements which, according to Section 19 of the Minimum Wage Law, should not bededucted from such
wages. It was found out that the meals were freely given to crew members prior to the effectivity of the Minimum
Wage Law while they were on the high seas not as part of their wages but as a necessary matter in the maintenance
of the health and efficiency of the crew members during the voyage. Thedeductions therein made for the meals given
after August 4, 1951, should be returned to them, and the operator of the coastwise vessels should continue giving
the benefits. Wherefore, the petition is dismissed, finding out that the meals or food in question are not facilities but
supplements.
PAL vs. NLRC
The issue before the Court is whether or not the NLRC committed grave abuse of discretion in holding that private
respondent Dolina was entitled to his salaries from 1 April 1979 "until this case is finally resolved."
PAL contends that inasmuch as the respondent Commission acting en banc had affirmed in toto the decision of the
Labor Arbiter granting petitioner the clearance for the dismissal of private respondent Dolina, it is an act of grave
abuse of discretion amounting to lack of jurisdiction on its part to order petitioner to pay private respondent's salaries
from 1 April 1979 until the case is finally terminated. PAL contends that said stipulation refers only to the resolution of
the case by arbitration and said arbitration of the case was terminated when the Labor Arbiter rendered its decision
dated 23 March 1979. PAL argues that the arbitration of the case is limited to and comprises merely the proceedings
before the Labor Arbiter such that when the latter renders a decision, arbitration of the dispute is terminated .

In the first place, backwages in general are granted on grounds of equity for earnings which a worker or employee
has lost due to his illegal dismissal. Where, as in this case, the dismissal was for a just cause, there is no factual or
legal basis for ordering the payment of backwages. The order of the NLRC for the continued payment of Dolina's
salaries would allow the latter to unjustly enrich himself at the expense of the petitioner. This Court has reiterated
time and again that the law, in protecting the rights of the laborer, authorizes neither oppression nor self-destruction
of the employer.In this case, the NLRC chose not to adhere with fidelity to this doctrine.
Secondly, NLRC's order for continued payment of Dolina's salary from 1 April 1979 up to the final resolution of the
case would place Dolina in a better position than those workers who were found to have been illegally dismissed by
their employer. For in the latter case, the backwages that can be recovered by the worker is limited to three years
while Dolina, whose dismissal was found to be valid, can recover approximately ten years backwages, which
corresponds to the period from 1 April 1979 until "final resolution" of the instant case.
INTERNATIONAL SCHOOL ALLIANCE OF EDUCATORS (ISAE), petitioner, vs. HON. LEONARDO A. QUISUMBING
in his capacity as the Secretary of Labor and Employment; HON. CRESENCIANO B. TRAJANO in his capacity as
the Acting Secretary of Labor and Employment; DR. BRIAN MACCAULEY in his capacity as the Superintendent of
International School-Manila; and INTERNATIONAL SCHOOL, INC., respondents.,
G.R. No. 128845, June 1, 2000

FACTS:

Private respondent International School, Inc. (School), pursuant to PD 732, is a domestic educational institution
established primarily for dependents of foreign diplomatic personnel and other temporary residents. The decree
authorizes the School to employ its own teaching and management personnel selected by it either locally or abroad,
from Philippine or other nationalities, such personnel being exempt from otherwise applicable laws and regulations
attending their employment, except laws that have been or will be enacted for the protection of employees. School
hires both foreign and local teachers as members of its faculty, classifying the same into two: (1) foreign-hires and (2)
local-hires.
The School grants foreign-hires certain benefits not accorded local-hires. Foreign-hires are also paid a salary rate
25% more than local-hires.
When negotiations for a new CBA were held on June 1995, petitioner ISAE, a legitimate labor union and the
collective bargaining representative of all faculty members of the School, contested the difference in salary rates
between foreign and local-hires. This issue, as well as the question of whether foreign-hires should be included in the
appropriate bargaining unit, eventually caused a deadlock between the parties.
ISAE filed a notice of strike. Due to the failure to reach a compromise in the NCMB, the matter reached the DOLE
which favored the School. Hence this petition.

ISSUE:
Whether the foreign-hires should be included in bargaining unit of local- hires.

RULING:
NO. The Constitution, Article XIII, Section 3, specifically provides that labor is entitled to humane conditions of work.
These conditions are not restricted to the physical workplace the factory, the office or the field but include as well
the manner by which employers treat their employees.
Discrimination, particularly in terms of wages, is frowned upon by the Labor Code. Article 248 declares it an unfair
labor practice for an employer to discriminate in regard to wages in order to encourage or discourage membership in
any labor organization.
The Constitution enjoins the State to protect the rights of workers and promote their welfare, In Section 18, Article II
of the constitution mandates to afford labor full protection. The State has the right and duty to regulate the relations

between labor and capital. These relations are not merely contractual but are so impressed with public interest that
labor contracts, collective bargaining agreements included, must yield to the common good.
However, foreign-hires do not belong to the same bargaining unit as the local-hires.
A bargaining unit is a group of employees of a given employer, comprised of all or less than all of the entire body of
employees, consistent with equity to the employer indicate to be the best suited to serve the reciprocal rights and
duties of the parties under the collective bargaining provisions of the law.
The factors in determining the appropriate collective bargaining unit are (1) the will of the employees (Globe
Doctrine); (2) affinity and unity of the employees interest, such as substantial similarity of work and duties, or
similarity of compensation and working conditions (Substantial Mutual Interests Rule); (3) prior collective bargaining
history; and (4) similarity of employment status. The basic test of an asserted bargaining units acceptability is
whether or not it is fundamentally the combination which will best assure to all employees the exercise of their
collective bargaining rights.
In the case at bar, it does not appear that foreign-hires have indicated their intention to be grouped together with
local-hires for purposes of collective bargaining. The collective bargaining history in the School also shows that these
groups were always treated separately. Foreign-hires have limited tenure; local-hires enjoy security of tenure.
Although foreign-hires perform similar functions under the same working conditions as the local-hires, foreign-hires
are accorded certain benefits not granted to local-hires such as housing, transportation, shipping costs, taxes and
home leave travel allowances. These benefits are reasonably related to their status as foreign-hires, and justify the
exclusion of the former from the latter. To include foreign-hires in a bargaining unit with local-hires would not assure
either group the exercise of their respective collective bargaining rights.
WHEREFORE, the petition is GIVEN DUE COURSE. The petition is hereby GRANTED IN PART.

Atok Big Wedge Mutual Benefit Association v Atok Big Wedge Mining Co. Inc.
GR No. L-7349
July 19, 1955
FACTS:
On September 4, 1950, a demand was submitted to petitioner by respondent union through its officers
for various concessions, among which were:
(a) An increase of P0.50 in wages;
(b) Commutation of sick and vacation leave if not enjoyed during the year;
(c) Various privileges, such as free medical care, medicine, and hospitalization;
(d) Right to a closed shop, check off etc.;
(e) No dismissal without prior just cause and with a prior investigation, etc.
Some of the demands were granted by petitioner and the others were rejected. Hearings were held in
the Court of Industrial Relations. After the hearing, the respondent court rendered a decision fixing the
minimum wage for the laborers at P3.20 without rice ration and 2.65 a day with rice ration, declaring
that additional compensation representing efficiency bonus should not be included as part of the
wage, and making the award effective from September 4, 1950 (the date of the presentation of the
original demand, instead of from April 5, 1951, the date of the amended demand).
Atok Company asked the Court for authority to stop operations & lay off employees and laborers, for
the reason that due to the heavy losses, increased taxes, high cost of materials, negligible quantity of
ore deports, and the enforcement of the Minimum Wage Law, the continued operation of the company
and the consequent lay-off of hundreds of laborers and employees.
The parties reached an agreement on October 29, 1952 after the SC decision which states agreement
that the following facilities heretofore given or actually being given by petitioner to its workers and
laborers, and which constitute as part of their wages, be valued as follows:
Rice ration P.55 per day
Housing facility 40 per day
All other facilities at least 85 per day
It is understood that the said amount of facilities valued at the above mentioned prices, may be
charged in full or partially by the Company against laborer or employee, as they may see fit pursuant
to the exigencies of its operation.
This was approved by the Court on December 26, 1952.
Later, another case was decided involving the 2 parties giving the employees minimum cash wage of
3.45 a day with rice ration or 4.00 without rice ration.
ISSUES:
(1) Which of the two decisions would prevail? The agreement or the subsequent decision giving the
employees minimum case wage?, and;
WON the Agreement of October 29, 1952 from the minimum daily wage of P4 would be a waiver of the
minimum wage fixed by the law and hence null and void, since RA 602 sec. 20 provides that no
agreement or contract, oral or written, to accept a lower wage or less than any other under this Act,
shall be valid.

(2) WON additional compensation should be paid by the Company to its workers for work rendered on
Sundays and holidays which should be based on the minimum wage of 4.00 and not on the cash
portion which is 2.20. [Currently the company pays additional compensation of 50% based on the 2.20
wage]
HELD:
(1) The Agreement subsists.
An agreement to deduct certain facilities received by the laborers from their employer is not a waiver
of the minimum wage fixed by the law. Wage includes the fair and reasonable value as determined by
the Secretary of Labor, of board, lodging, or other facilities customarily furnished by the employer to
the employee (Sec 2 of RA 602).
Thus, the law permits the deduction of such facilities from the laborers minimum wage of P4, as long
as their value is fair and reasonable
(2) NO. The Company is correct.
Section 4 of the Commonwealth Act No. 444 (Eight Hour Labor Law) provides:
No person, firm, or corporations... shall compel an employee or laborer to work during Sundays and
holidays, unless he is paid an additional sum of at least 25% of his regular remuneration.
Thus, the Company even pays the laborers higher wage than the minimum. Thus, no law is violated.
OTHER NOTES:
DIFFERENCE BETWEEN A SUPPLEMENT and FACILITY
(1) Supplements, defined extra remuneration or special privileges or benefits given to or received by
the laborers over and above their ordinary earnings or wages [vacation and holidays not worked; paid
sick leave or maternity leave; overtime rate in excess of what is required by law; sick, pension,
retirement and death benefits; profit sharing; family allowances; Christmas, war risk and cost of living
bonuses or other bonuses other than those paid as a reward for extra output or time spent on the job
(2) Facilities, defined items of expense necessary for laborers and his familys existence and
subsistence, so that by express provision of the law, they form 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.
On the issue of the wage, it is contended by petitioner that as the respondent court found that the laborer and his
family at least need the amount of P2.58 for food, this should be the basis for the determination of his wage, not what
he actually spends; that it is not justifiable to fix a wage higher than that provided by Republic Act No. 602; and that
respondent union made the demand in accordance with a pernicious practice of claiming more after an original
demand is granted. The respondent court found that P2.58 is the minimum amount actually needed by the laborer
and his family. That does not mean that it is his actual expense. A person's needs increase as his means increase.
This is true not only as to food but as to everything else education, clothing, entertainment, etc. The law
guarantees the laborer a fair and just wage. The minimum must be fair and just. The "minimum wage" can by no
means imply only the actual minimum. Some margin or leeway must be provided, over and above the minimum, to
take care of contingencies such as increase of prices of commodities and desirable improvement in his mode of
living. Certainly, the amount of P0.22 a day (difference between P2.80 fixed and P2.58 actual) is not excessive for
this purpose. That the P3 minimum wage fixed in the law is still far below what is considered a fair and just minimum
is shown by the fact that this amount is only for the year after the law takes effect, as thereafter the law fixes it at P4.
Neither may it be correctly contended that the demand for increase is due to an alleged pernicious practice. Frequent
demands for increase are indicative of a healthy spirit of wakefulness to the demands of a progressing and an
increasingly more expensive world. We, therefore, find no reason or ground for disturbing the finding contained in the
decision fixing the amount of P3.20 as the minimum wage.
De racho
This also disposes of the implication appellant is trying to make that its duty to pay minimum wages is not a statutory
obligation which would command preference in the municipal budget and appropriation ordinance. Moreover, We
cannot sanction appellant's proposition that it would eventually and gradually implement the Minimum Wage Law, "if
and when its revenues can afford." The law insofar as it affects government employees took effect in 1952. 3 It
should have been implemented or at least steps to implement it should have been taken right then. To excuse
the defendant municipality now would be to permit it to benefit from its non-feasance. It would also make the
effectivity of the law dependent upon the will and initiative of said municipality without statutory sanction. Defendant's
remedy, therefore, is not to seek an excuse from implementing the law but, as the lower court suggested, to upgrade
and improve its tax collection machinery with a view towards realizing more revenues. Or, it could for the present
forego all non-essential expenditures.