ASSIGNMENT FOR SEPTEMBER 27, 2018

VI. WORKING CONDITIONS AND REST PERIODS

Book Reference: Labor Standards and Social Legislation with Notes and Comments by Dean Salvador
Poquiz

Statutory References:

Art. 82 to 97 of the Renumbered Labor Code

Book III, Rule I to Rule VI of the Omnibus Rules Implementing the Labor Code
Department Advisory No. 2, Series of 2009
RA 8187 Paternity Leave Act
RA 8282 Maternity Leave Act
RA 8972 Solo Parents' Welfare Act
RA 9262 Violence Against Women and Children
RA 9710 The Magna Carta of Women

Topics:
A. Hours of Work
1. Compensable Hours of Work
2. Normal Hours of Work
3. Meal Periods
4. Flexible Work Arrangements
5. Night Shift Differential
6. Overtime Work
7. Emergency Overtime Work
8. Undertime not offset by Overtime
B. Weekly Rest Period
C. Right to Holiday Pay
1. Kinds of Holidays
2. Rules in Computing Holiday Pay
3. No Work, No Pay Rule
D. Service Incentive Leave
E. Service Charges
F. Other Special Leave Benefits
1. Maternity Leave – coverage & entitlement/benefit
2. Paternity Leave - coverage & entitlement/benefit
3. Parental Leave - coverage & entitlement/benefit
4. Leave for victims of VAWC - coverage & entitlement/benefit
5. Special Leave for Women - coverage & entitlement/benefit

Cases:

Asia Pacific vs. Farolan, 393 SCRA 454, GR 151370 (2002)

Autobus vs. Bautista, 458 SCRA 578, GR 156367, May 5, 2005
Red vs Coconut, GR L21348 June 30, 1966, 17 SCRA 553
Arica vs. NLRC, 170 SCRA 776, GR 78210, Feb. 28, 1989
PAL vs. NLRC, 302 SCRA 582 (1999) GR 132805
Mercury Drug vs. Nardo Dayao, G.R. No. L-15422, November 30, 1962
Loon vs. Powermaster, G.R. No. 189404, December 11, 2013
PNB vs. PNB Employees Association, 115 SCRA 507
Asian Transmission vs. CA, G.R. No. 144664, Mar. 16, 2004
Jose Rizal College vs NLRC, 156 SCRA 27
Mansion Printing vs. Bitara, G.R. No. 168120, January 25, 2012
Mayon Hotel vs. Adana, G.R. No. 157634, May 16, 2005

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5
PHILIPPINE AIRLINES, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION,
LABOR ARBITER ROMULUS PROTACIO and DR. HERMINIO A. FABROS, respondents.

Private respondent, FABROS, was employed as flight surgeon at petitioner company. He was assigned at
the PAL Medical Clinic at Nichols and was on duty from 4:00 in the afternoon until 12:00 midnight.

DINNER – 7PM-7:50 THEN HEART ATTACK INCIDENT, HE ARRIVED 7:51

INVESTIGATION – EXPLAIN WHY NO DISCIPLINARY ACTION SHOULD BE DONE

RESPONDENT (R): HE WAS ENTITLED TO 30 MIN MEAL BREAK, IMMEDIATELY LEFT RESIDENCE
UPON INFO, WAS RUSHED TO THE HOSP WITHOUT HIM. – UNACCEPTABLE

Management charged private respondent with abandonment of post while on duty. He was given ten days
to submit a written answer to the administrative charge.

R denied and reiterated above defenses but was SUSPENDED FOR 3 MONTHS. R FILED COMPLAINT
FOR ILLEGAL SUSPENSION.

LABOR ARBITER (LA): SUSPENSION WAS ILLEGAL. PAYMENT TO RESPONDENT OF WHAT HE

SHOULD HAVE RECEIVED DURING SUSPENSION PLUS 500K MORAL DAMAGES.

PETITIONER (P): APPEALED TO NLRC.

NLRC: DISMISSED APPEAL after finding that the decision of the Labor Arbiter is supported by the facts
on record and the law on the matter.[3] The NLRC likewise denied petitioners motion for reconsideration.

P ASSAILED DECISION OF NLRC – ARGUMENTS:

1. PUBLIC RESPONDENTS (PR) acted without or in excess of their jurisdiction and with grave abuse
of discretion in nullifying the 3-month suspension of private respondent despite the fact that the
private respondent has committed an offense that warranted the imposition of disciplinary action.
2. PR acted without or in excess of their jurisdiction and with grave abuse of discretion in holding the
petitioner liable for moral damages: a) no formal hearing to substantiate claims; b) absence of proof
of bad faith of P; and c) LA award of MD was highly irregular, more than was the priv resp prayed
for.

SUPREME COURT (SC): PR DID NOT ERR IN NULLIFYING 3 MOS SUSPENSION BUT ERRED IN
AWARDING MORAL DAMAGES TO R.
1. LEGALITY OF PR SUSPENSION: facts do not support petitioners allegation that private
respondent abandoned his post. PVR left the clinic that night only to have his dinner at his house,
which was only a few minutes drive away from the clinic. His whereabouts were known to the
nurse on duty so that he could be easily reached in case of emergency. Upon being informed of Mr.
Acostas condition, private respondent immediately left his home and returned to the clinic. These
facts belie petitioners claim of abandonment.

P: being a full-time employee, private respondent is obliged to stay in the company premises for not
less than eight (8) hours. Hence, he may not leave the company premises during such time, even to
take his meals.

SC:

Articles 83 and 85 of the Labor Code read:

Art. 83. Normal hours of work.The normal hours of work of any employee shall not exceed eight (8)
hours a day.

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 Health personnel in cities and municipalities with a population of at least one million (1,000,000) or
in hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office
hours for eight (8) hours a day, for five (5) days a week, exclusive of time for meals.

Art. 85. Meal periods.Subject to such regulations as the Secretary of Labor may prescribe, it shall be
the duty of every employer to give his employees not less than sixty (60) minutes time-off for their
regular meals.

EVEN SUPPORTED BY Section 7, Rule I, Book III of the Omnibus Rules Implementing the Labor
Code.

Thus, the eight-hour work period does not include the meal break. Nowhere in the law may it be
inferred that employees must take their meals within the company premises.Employees are not
prohibited from going out of the premises as long as they return to their posts on time. Private
respondents act, therefore, of going home to take his dinner does not constitute abandonment.

2. Award of moral damages to private respondent: Not every employee who is illegally dismissed or
suspended is entitled to damages.As a rule, moral damages are recoverable only where the
dismissal or suspension of the employee was attended by bad faith or fraud, or constituted an act
oppressive to labor, or was done in a manner contrary to morals, good customs or public policy.
Bad faith does not simply mean negligence or bad judgment. It involves a state of mind dominated
by ill will or motive. It implies a conscious and intentional design to do a wrongful act for a dishonest
purpose or some moral obliquity. The person claiming moral damages must prove the existence of
bad faith by clear and convincing evidence for the law always presumes good faith.

In the case at bar, there is no showing that the management of petitioner company was moved by
some evil motive in suspending private respondent. It suspended private respondent on an
honest, albeit erroneous, belief that private respondents act of leaving the company premises to take
his meal at home constituted abandonment of post which warrants the penalty of suspension. Also,
it is evident from the facts that petitioner gave private respondent all the opportunity to refute the
charge against him and to defend himself. These negate the existence of bad faith on the part of
petitioner. Under the circumstances, we hold that private respondent is not entitled to moral
damages.

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MERCURY DRUG CO., INC., petitioner,
vs.
NARDO DAYAO, ET AL., respondents

VERIFIED PETITION FILED BY NARDO DAYAO AND 70 OTHERS AGAINST MERCURY DRUG AND
MARIANO QUE, PRES AND GM AND ITS EMPLOYEE’S ASSOCIATION PRAYING FOR:
1. PAYMENT OF UNPAID BACKWAGES FOR WORK DONE ON SUNDAYS AND LEGAL
HOLIDAYS.
2. PAYMENT OF EXTRA COMPENSATION ON WORK DONE AT NIGHT.
3. RETIREMENT OF REFERENTE AND ECHALAR WITH BACK SALARIES

AND AS AGAINST THE UNION, FOR FISESTABLISHMENT AND REFUND OF ALL MONEYS IT HAD
COLLECTED FROM PETITIONERS.

R MANAGEMENT AND R UNION MOVED TO DISMISS ON THE GROUND THAT:

1. PETITION STATES NO CAUSE OF ACTION
2. COURT HAS NO JURISDICTION OVER SUBJ OF CLAIMS OF RETIREES
3. THERE IS ANOTHER ACTION PENDING BETWEEN THE SAME PARTIES.

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The respondent court rendered its decision that:

1. The claim of the petitioners for payment of back wages correspoding to the first four hours work
rendered on every other Sunday and first four hours on legal holidays should be denied for lack of
merit;

2. Respondent Mercury Drug Company, Inc. is hereby ordered to pay the sixty- nine (69)
petitioners: (a) An additional sum equivalent to 25% of their respective basic or regular salaries for
services rendered on Sundays and legal holidays during the period from March 20, 1961 up to June
30, 1962; and (b) Another additional sum or premium equivalent to 25% of their respective basic or
regular salaries for nighttime services rendered from March 20, 1961 up to June 30, 1962; and

3. Petitioners' petition to convert them to monthly employees should be, as it is hereby, denied for
lack of merit. Not satisfied with the decision, the respondents filed a motion for its reconsideration.
The motion for reconsideration, was however, denied by the Court en banc.

NOT SATISFIED, R FILED MOTION FOR RECON WHICH WAS DENIED BY THE COURT EN BANC.
WITH THE DECISION OF THE CIR, MERCURY FILED THE PETITION CONTENDING THAT:
1. R CIR ERRED IN DECLARING CONTRACTS OF EMPLOYMENT NULL AND VOID AS BEING
CONTRARY TO PUBLIC POLICY AND SUSTAINING DAYAO ET AL’S CLAIMS FOR 25%
SUNDAY AND LEGAL HOLIDAY PREMIUMS ARE NOT SUPPORTED BY SUBTANTIAL
EVIDENCE, THUS INFRINGING UPON THE CARDINAL RIGHTS OF THE PETITIONER,
2. ERRED IN SUSTAINING PRIVATE RESPONDENTS CLAIMS FOR NIGHTTIME WORK
PREMIUMS NOT ONLY BECAUSE OF COLLECTIVE BARGAINING FREEDOM, BUT ALSO OF
EXPRESS WAIVER THEREOF WITH TOTAL ABSENCE OF EVIDENCE.
3. ERRED IN MAKING AWARDS IN FAVOR OF PVR WHO NEITHER GAVE EVIDENCE NOR
EVEN APPEARED TO SHOW INTEREST.

3 ISSUES DISCUSSED BY THE SUPREME COURT:

The Supreme Court dismissed the petition. On the first issue, based on Sec. 4 CA No. 444, No person, firm
or corporation, business establishment or place of center of labor shall compel an employee or laborer to
work during Sundays and legal holidays unless he is paid an additional sum of at least twenty-five per
centum of his regular remuneration: PROVIDED, HOWEVER, That this prohibition shall not apply to
public utilities performing some public service such as supplying gas, electricity, power, water, or
providing means of transportation or communication.

Although a service enterprise, respondent company's employees are within the coverage of SAID
PROVISION, as amended known as the Eight Hour Labor Law, for they do not fall within the category or
class of employees or laborers excluded from its provisions.

On the second issue, their 25% additional compensation for work done on Sundays and Legal Holidays
were not included in their respective monthly salaries. The petitioner contention was not supported by
substantial evidence. This contention is based on the testimony of its lone witness, Mr. Jacinto Concepcion
and pertinent exhibits.

THE COMPUTATIONS miserably failed to show the exact and correct annual salary as stated in the
respective contracts of employment of the respondent employees. The figures arrived at in each case did
not tally with the annual salaries on to the employees' contracts of employment, the difference varying
from P1.20 to as much as P14.40 always against the interest of the employees. The petitioner's defense
consists of mathematical computations made after the filing of the case in order to explain a clear attempt
to make its employees work without the extra compensation provided by law on Sundays and legal
holidays.

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The last issue, the Mercury Drug Co., Inc., maintains a chain of drugstores that are open every day of the
week and, for some stores, up to very late at night because of the nature of the pharmaceutical retail
business. The respondents knew that they had to work Sundays and holidays and at night, not as
exceptions to the rule but as part of the regular course of employment. Presented with contracts setting
their compensation on an annual basis with an express waiver of extra compensation for work on Sundays
and holidays, the workers did not have much choice. The private respondents were at a disadvantage
insofar as the contractual relationship was concerned. Workers in our country do not have the luxury or
freedom of declining job openings or filing resignations even when some terms and conditions of
employment are not only onerous and inequitous but illegal.

It is precisely because of this situation that the framers of the Constitution embodied the provisions on
social justice (Section 6, Article 11) and protection to labor (Section 9, Article I I) in the Declaration of
Principles And State Policies.

WILGEN LOON, JERRY ARCILLA, ALBERTPEREYE, ARNOLD PEREYE, EDGARDO OBOSE, ARNEL
MALARAS, PATROCINO TOETIN, EVELYN LEONARDO, ELMER GLOCENDA, RUFO CUNAMAY,
ROLANDOSAJOL, ROLANDO ABUCAYON, JENNIFER NATIVIDAD, MARITESS TORION,
ARMANDO LONZAGA, RIZAL GELLIDO, EVIRDE HAQUE,1 MYRNA VINAS, RODELITO AYALA,
WINELITO OJEL, RENATO RODREGO, NENA ABINA, EMALYN OLIVEROS, LOUIE ILAGAN,
JOEL ENTIG, ARNEL ARANETA, BENJAMIN COSE, WELITO LOON and WILLIAM
ALIPAO, Petitioners,
vs.
POWER MASTER, INC., TRI-C GENERAL SERVICES, and SPOUSES HOMER and CARINA
ALUMISIN,Respondents.

Respondents Power Master, Inc. and Tri-C General Services employed and assigned the petitioners as
janitors and leadsmen in various Philippine Long Distance Telephone Company (PLDT) offices in Metro
Manila area. Subsequently, the petitioners filed a complaint for money claims against Power Master, Inc.,
Tri-C General Services and their officers, the spouses Homer and Carina Alumisin
(collectively, the respondents). The petitioners alleged in their complaint that they were not paid minimum
wages, overtime, holiday, premium, service incentive leave, and thirteenth month pays. They further
averred that the respondents made them sign blank payroll sheets. On June 11, 2001, the petitioners
amended their complaint and included illegal dismissal as their cause of action. They claimed that the
respondents relieved them from service in retaliation for the filing of their original complaint.

Notably, the respondents did not participate in the proceedings before the Labor Arbiter except on April
19, 2001 and May 21, 2001 when Mr. Romulo Pacia, Jr. appeared on the respondents’ behalf.5 The
respondents’ counsel also appeared in a preliminary mandatory conference on July 5, 2001.6 However, the
respondents neither filed any position paper nor proffered pieces of evidence in their defense despite their knowledge of
the pendency of the case.

LA: RULED IN FAVOR OF PETITIONERS. The LA awarded the petitioners salary differential, service
incentive leave, and thirteenth month pays. In awarding these claims, the LA stated that the burden of
proving the payment of these money claims rests with the employer. The LA also awarded attorney’s
fees in favor of the petitioners, pursuant to Article 111 of the Labor Code.

However, the LA denied the petitioners’ claims for backwages, overtime, holiday, and premium pays. The
LA observed that the petitioners failed to show that they rendered overtime work and worked on holidays
and rest days without compensation. The LA further concluded that the petitioners cannot be declared to
have been dismissed from employment because they did not show any notice of termination of
employment. They were also not barred from entering the respondents’ premises.

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BOTH PARTIES APPEALED IN NLRC. PETITIONERS FOR DENIAL OF THE OTHER CLAIMS WHILE
RESPONDENTS ON LA’S JURISDICTION OVER THEIR PERSONS.

PERSONALLY NOT SERVED WITH SUMMONS AND OTHER PROCESSES. THEY ALSO claimed that
they paid the petitioners minimum wages, service incentive leave and thirteenth month pays. As proofs,
they attached photocopied and computerized copies of payroll sheets to their memorandum on appeal.
CONTENDED THAT PETITIONERS WERE VALIDLY DISMISSED. Petitioners’ repeated defiance to
their transfer to different workplaces and their violations of the company rules and regulations constituted
serious misconduct and willful disobedience.

RP FILED UNVERIFIED SUPPLEMENTAL APPEAL. They attached photocopied and computerized

copies of list of employees with automated teller machine (ATM) cards to the supplemental appeal. This
list also showed the amounts allegedly deposited in the employees’ ATM cards.11 They also attached
documentary evidence showing that the petitioners were dismissed for cause and had been accorded
due process.

BUT THEY SUBSEQUENTLY FILED FOR THE URGENT MANIFESTATION AND MOTION ASKING
FOR THE DELETION OF THE SUPPLEMENTAL APPEAL BECAUSE IT SUFFERED INFIRMITIES. The
attached documentary evidence on the supplemental appeal bore the petitioners’ forged signatures.

The petitioners argued in this last motion that the payrolls should not be given probative value because
they were the respondents’ fabrications. They reiterated that the genuine payrolls bore their signatures,
unlike the respondents’ photocopies of the payrolls. They also maintained that their signatures in the
respondents’ documents (which showed their receipt of thirteenth month pay) had been forged.

NLRC RULING:

The NLRC affirmed the LA’s awards of holiday pay and attorney’s fees. It also maintained that the LA
acquired jurisdiction over the persons of the respondents through their voluntary appearance.

However, it allowed the respondents to submit pieces of evidence for the first time on appeal on the
ground that they had been deprived of due process.

The NLRC also vacated the LA’s awards of salary differential, thirteenth month and service incentive
leave pays. In so ruling, it gave weight to the pieces of evidence attached to the memorandum on appeal
and the supplemental appeal. It maintained that the absence of the petitioners’ signatures in the payrolls
was not an indispensable factor for their authenticity. It pointed out that the payment of money claims was
further evidenced by the list of employees with ATM cards. It also found that the petitioners’ signatures
were not forged. It took judicial notice that many people use at least two or more different signatures.

The NLRC further ruled that the petitioners were lawfully dismissed on grounds of serious misconduct
and willful disobedience. It found that the petitioners failed to comply with various memoranda directing
them to transfer to other workplaces and to attend training seminars for the intended reorganization and
reshuffling.

The NLRC denied the petitioners’ motion for reconsideration in a resolution dated April 28,
2006.17 Aggrieved, the petitioners filed a petition for certiorari under Rule 65 of the Rules of Court before the
CA.18

CA RULING:

The CA affirmed the NLRC’s ruling.

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PETITION:

In the petition before this Court, the petitioners argue that the CA committed a reversible error when it did
not find that the NLRC committed grave abuse of discretion. They reiterate their arguments before the
lower tribunals and the CA in support of this conclusion. They also point out that the respondents posted a
bond from a surety that was not accredited by this Court and by the NLRC. In effect, the respondents failed
to perfect their appeal before the NLRC. They further insist that the NLRC should not have admitted the
respondents’ unverified supplemental appeal.

RESPONDENTS POSITION:

In their Comments, the respondents stress that the petitioners only raised the issue of the validity of the
appeal bond for the first time on appeal. They also reiterate their arguments before the NLRC and the CA.
They additionally submit that the petitioners’ arguments have been fully passed upon and found
unmeritorious by the NLRC and the CA.

ISSUE:

4) Whether the petitioners are entitled to salary differential, overtime, holiday, premium, service incentive
leave, and thirteenth month pays

COURT’S RULING:

The petitioners are entitled to

backwages

Based on the above considerations, we reverse the NLRC and the CA’s finding that the petitioners were
terminated for just cause and were afforded procedural due process. In termination cases, the burden of
proving just and valid cause for dismissing an employee from his employment rests upon the employer.
The employer’s failure to discharge this burden results in the finding that the dismissal is unjustified.40 This
is exactly what happened in the present case.

The petitioners are entitled to salary

differential, service incentive,
holiday, and thirteenth month pays

We also reverse the NLRC and the CA’s finding that the petitioners are not entitled to salary differential,
service incentive, holiday, and thirteenth month pays. As in illegal dismissal cases, the general rule is that
the burden rests on the defendant to prove payment rather than on the plaintiff to prove non-payment of
these money claims.41 The rationale for this rule is that the pertinent personnel files, payrolls, records,
remittances and other similar documents – which will show that differentials, service incentive leave and
other claims of workers have been paid – are not in the possession of the worker but are in the custody and
control of the employer.42

The petitioners are not entitled to

overtime and premium pays

However, the CA was correct in its finding that the petitioners failed to provide sufficient factual basis for
the award of overtime, and premium pays for holidays and rest days. The burden of proving entitlement to
overtime pay and premium pay for holidays and rest days rests on the employee because these are not
incurred in the normal course of business.43 In the present case, the petitioners failed to adduce any
evidence that would show that they actually rendered service in excess of the regular eight working hours
a day, and that they in fact worked on holidays and rest days.

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8

PNB vs PEMA
9

ASIAN TRANSMISSION CORPORATION VS. CA ET AL DIGEST

Petitioner seeks via petition for certiorari under Rule 65 the nullification of the Decision1 of the Court of
Appeals denying its petition to annul 1) Explanatory Bulletin”2 of the Department of Labor and
Employment (DOLE) entitled “Workers’ Entitlement to Holiday Pay on April 9, 1993, Araw ng Kagitingan
and Good Friday”, which bulletin the DOLE reproduced on January 23, 1998, 2) Decision3 of the Panel of
Voluntary Arbitrators ruling that the said explanatory bulletin applied as well to April 9, 1998, and
3) Resolution of the Panel of Voluntary Arbitration denying its Motion for Reconsideration.
FACTS:

The Department of Labor and Employment (DOLE), through Undersecretary Cresenciano B. Trajano,
issued an Explanatory Bulletin dated March 11, 1993 wherein it clarified, inter alia, that employees are
entitled to 200% of their basic wage on April 9, 1993, whether unworked, which[,] apart from being Good
Friday [and, therefore, a legal holiday], is also Araw ng Kagitingan [which is also a legal holiday].
“On the correct payment of holiday compensation on April 9, 1993 which apart from being Good Friday is
also Araw ng Kagitingan, i.e., two regular holidays falling on the same day, this Department is of the view
that the covered employees are entitled to at least two hundred percent (200%) of their basic wage even if
said holiday is unworked. The first 100% represents the payment of holiday pay on April 9, 1993 as Good
Friday and the second 100% is the payment of holiday pay for the same date as Araw ng Kagitingan.
Said bulletin was reproduced on January 23, 1998, when April 9, 1998 was both Maundy Thursday
and Araw ng Kagitingan x x x x
Despite the explanatory bulletin, petitioner [Asian Transmission Corporation] opted to pay its daily paid
employees only 100% of their basic pay on April 9, 1998. Respondent Bisig ng Asian Transmission Labor
Union (BATLU) protested.
In accordance with Step 6 of the grievance procedure of the Collective Bargaining Agreement (CBA)
existing between petitioner and BATLU, the controversy was submitted for voluntary arbitration. x x x x
On July 31, 1998, the Office of the Voluntary Arbitrator rendered a decision directing petitioner to pay its
covered employees “200% and not just 100% of their regular daily wages for the unworked April 9,
1998 which covers two regular holidays, namely, Araw ng Kagitignan and Maundy Thursday.”
Subject of interpretation in the case at bar is Article 94 of the Labor Code which reads:
ART. 94. Right to holiday pay. – (a) Every worker shall be paid his regular daily wage during regular
holidays, except in retail and service establishments regularly employing less than ten (10) workers;
(b) The employer may require an employee to work on any holiday but such employee shall be paid a
compensation equivalent to twice his regular rate; and
(c) As used in this Article, “holiday” includes: New Year’s Day, Maundy Thursday, Good Friday, the ninth
of April, the first of May, the twelfth of June, the fourth of July, the thirtieth of November, the twenty-fifth
and thirtieth of December and the day designated by law for holding a general election,
which was amended by Executive Order No. 203 issued on June 30, 1987, such that the regular holidays are
now:
1. New Year’s Day January 1
2. Maundy Thursday Movable Date
3. Good Friday Movable Date
4. Araw ng Kagitingan April 9 (Bataan and Corregidor Day)
5. Labor Day May 1
6. Independence Day June 12
7. National Heroes Day Last Sunday of August
8. Bonifacio Day November 30
9. Christmas Day December 25

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 10. Rizal Day December 30
In deciding in favor of the Bisig ng Asian Transmission Labor Union (BATLU), the Voluntary Arbitrator
held that Article 94 of the Labor Code provides for holiday pay for every regular holiday, the computation
of which is determined by a legal formula which is not changed by the fact that there are two holidays
falling on one day, like on April 9, 1998 when it was Araw ng Kagitingan and at the same time was Maundy
Thursday; and that that the law, as amended, enumerates ten regular holidays for every year should not be
interpreted as authorizing a reduction to nine the number of paid regular holidays “just because April 9
(Araw ng Kagitingan) in certain years, like 1993 and 1998, is also Holy Friday or Maundy Thursday.”
In the assailed decision, the Court of Appeals upheld the findings of the Voluntary Arbitrator, holding that
the Collective Bargaining Agreement (CBA) between petitioner and BATLU, the law governing the
relations between them, clearly recognizes their intent to consider Araw ng Kagitingan and Maundy
Thursday, on whatever date they may fall in any calendar year, as paid legal holidays during the effectivity
of the CBA and that “[t]here is no condition, qualification or exception for any variance from the clear
intent that all holidays shall be compensated.”5
The Court of Appeals further held that “in the absence of an explicit provision in law which provides for
[a] reduction of holiday pay if two holidays happen to fall on the same day, any doubt in the interpretation
and implementation of the Labor Code provisions on holiday pay must be resolved in favor of labor.”
ISSUE:

Whether daily-paid employees are entitled to be paid for two regular holidays which fall on the same day.
HELD:

This Court finds no ground to disturb the assailed decision.

Holiday pay is a legislated benefit enacted as part of the Constitutional imperative that the State shall
afford protection to labor.7 Its purpose is not merely “to prevent diminution of the monthly income of the
workers on account of work interruptions. In other words, although the worker is forced to take a rest, he
earns what he should earn, that is, his holiday pay.”8 It is also intended to enable the worker to participate
in the national celebrations held during the days identified as with great historical and cultural
significance.
Independence Day (June 12), Araw ng Kagitingan (April 9), National Heroes Day (last Sunday of August),
Bonifacio Day (November 30) and Rizal Day (December 30) were declared national holidays to afford
Filipinos with a recurring opportunity to commemorate the heroism of the Filipino people, promote
national identity, and deepen the spirit of patriotism. Labor Day (May 1) is a day traditionally reserved to
celebrate the contributions of the working class to the development of the nation, while the religious
holidays designated in Executive Order No. 203 allow the worker to celebrate his faith with his family.
As reflected above, Art. 94 of the Labor Code, as amended, affords a worker the enjoyment of ten paid
regular holidays.9 The provision is mandatory,10regardless of whether an employee is paid on a monthly
or daily basis.11Unlike a bonus, which is a management prerogative,12 holiday pay is a statutory benefit
demandable under the law. Since a worker is entitled to the enjoyment of ten paid regular holidays, the
fact that two holidays fall on the same date should not operate to reduce to nine the ten holiday pay
benefits a worker is entitled to receive.
From the pertinent provisions of the CBA entered into by the parties, petitioner had obligated itself to pay
for the legal holidays as required by law.
Only an employee who works on the day immediately preceding or after a regular holiday shall be entitled
to the holiday pay.
A paid legal holiday occurring during the scheduled vacation leave will result in holiday payment in
addition to normal vacation pay but will not entitle the employee to another vacation leave.
Under similar circumstances, the COMPANY will give a day’s wage for November 1st and December 31st
whenever declared a holiday. When required to work on said days, the employee will be paid according to
Art. VI, Sec. 3B hereof.18
WHEREFORE, the petition is hereby DISMISSED.

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10

JOSE RIZAL COLLEGE, petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION AND NATIONAL ALLIANCE OF
TEACHERS/OFFICE WORKERS, respondents.

Facts:
Petitioner is a non-stock, non-profit educational institution duly organized and existing under the laws of
the Philippines.

Private respondent National Alliance of Teachers and Office Workers (NATOW) in behalf of the faculty
and personnel of Jose Rizal College filed a complaint against the college for said alleged non-payment of
holiday pay from 1975 to 1977.

Labor Arbiter:

1. The faculty and personnel of the respondent Jose Rizal College who are paid their salary by the month
uniformly in a school year, irrespective of the number of working days in a month, without deduction
for holidays, are presumed to be already paid the 10 paid legal holidays and are no longer entitled to
separate payment for the said regular holidays;
2. The personnel of the respondent Jose Rizal College who are paid their wages daily are entitled to be
paid the 10 unworked regular holidays according to the pertinent provisions of the Rules and
Regulations Implementing the Labor Code;
3. Collegiate faculty of the respondent Jose Rizal College who by contract are paid compensation per
student contract hour are not entitled to unworked regular holiday pay considering that these regular
holidays have been excluded in the programming of the student contact hours.
NLRC: Teaching personnel paid by the hour are entitled to holiday pay

Issue:
Whether or not the school faculty who according to their contracts are paid per lecture hour are entitled to
unworked holiday pay.

Held:
No. The provisions in the Labor Code as to holiday pay do not apply in this case.

Subject holiday pay is provided for in the Labor Code (Presidential Decree No. 442, as amended), which reads:
Art. 94. Right to holiday pay — (a) Every worker shall be paid his regular daily wage during regular holidays, except
in retail and service establishments regularly employing less than ten (10) workers;
(b) The employer may require an employee to work on any holiday but such employee shall be paid a compensation
equivalent to twice his regular rate; … “
and in the Implementing Rules and Regulations, Rule IV, Book III, which reads:
SEC. 8. Holiday pay of certain employees. — (a) Private school teachers, including faculty members of colleges and
universities, may not be paid for the regular holidays during semestral vacations. They shall, however, be paid for the
regular holidays during Christmas vacations. …
The aforementioned implementing rule is not justified by the provisions of the law which after all is silent
with respect to faculty members paid by the hour. Regular holidays specified as such by law are known to
both school and faculty members as no class days;” certainly the latter do not expect payment for said
unworked days, and this was clearly in their minds when they entered into the teaching contracts.

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On the other hand, both the law and the Implementing Rules governing holiday pay are silent as to
payment on Special Public Holidays.

It is readily apparent that the declared purpose of the holiday pay which is the prevention of diminution of
the monthly income of the employees on account of work interruptions is defeated when a regular class
day is cancelled on account of a special public holiday and class hours are held on another working day to
make up for time lost in the school calendar. Otherwise stated, the faculty member, although forced to take
a rest, does not earn what he should earn on that day. Be it noted that when a special public holiday is
declared, the faculty member paid by the hour is deprived of expected income, and it does not matter that
the school calendar is extended in view of the days or hours lost, for their income that could be earned
from other sources is lost during the extended days. Similarly, when classes are called off or shortened on
account of typhoons, floods, rallies, and the like, these faculty members must likewise be paid, whether or
not extensions are ordered.

SC Decision:

(a) exempting petitioner from paying hourly paid faculty members their pay for regular holidays, whether
the same be during the regular semesters of the school year or during semestral, Christmas, or Holy Week
vacations;
(b) but ordering petitioner to pay said faculty members their regular hourly rate on days declared as
special holidays or for some reason classes are called off or shortened for the hours they are supposed to
have taught, whether extensions of class days be ordered or not; in case of extensions said faculty members
shall likewise be paid their hourly rates should they teach during said extensions.

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MANSION PRINTING and CHENG VS. BITARA

G.R. No. 168120

January 25, 2012

FACTS:
Mansion Printing Center is a single proprietorship engaged in the printing of quality self-adhesive labels,
brochures, posters, stickers, packaging and the like.
Mansion engaged the services of Bitara as a helper (kargador). Respondent was later promoted as the
company’s sole driver tasked , among others, to deliver the products to the clients within the delivery
schedules.
Petitioners aver that the timely delivery of the products to the clients is one of the foremost considerations
material to the operation of the business. It being so, they closely monitored the attendance of respondent.
They noted his habitual tardiness and absenteeism.
Petitioners issued a Memorandum requiring respondent to submit a written explanation why no
administrative sanction should be imposed on him for his habitual tardiness, to which he replied. But
despite respondent’s undertaking to report on time, however, he continued to disregard attendance
policies.
respondent filed a complaint for illegal dismissal against the petitioners before the Labor Arbiter.

ISSUE: Was there gross and habitual neglect of duty on the part of Bitara, warranting his dismissal from
service

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HELD: YES; there is no illegal dismissal
Valiao v. Court of Appeals is instructive:
xxx It bears stressing that petitioner’s absences and tardiness were not isolated incidents but manifested a
pattern of habituality. xxx The totality of infractions or the number of violations committed during the
period of employment shall be considered in determining the penalty to be imposed upon an erring
employee. The offenses committed by him should not be taken singly and separately but in their totality.
Fitness for continued employment cannot be compartmentalized into tight little cubicles of aspects of
character, conduct, and ability separate and independent of each other.
In Valiao, we defined gross negligence as “want of care in the performance of one’s duties”and habitual
neglect as “repeated failure to perform one’s duties for a period of time, depending upon the
circumstances.” These are not overly technical terms, which, in the first place, are expressly sanctioned by
the Labor Code of the Philippines, to wit:
ART. 282. Termination by employer. – An employer may terminate an employment for any of the
following causes:
xxx
(b) Gross and habitual neglect by the employee of his duties;
xxx
Bitara’s weekly time record for the first quarter of the year 2000 revealed that he came late 19 times out of
the 47 times he reported for work. He also incurred 19 absences out of the 66 working days during the
quarter. His absences without prior notice and approval from March 11-16, 2000 were considered to be the
most serious infraction of all because of its adverse effect on business operations.
Clearly, even in the absence of a written company rule defining gross and habitual neglect of duties,
respondent’s omissions qualify as such warranting his dismissal from the service.
NOTES:

We cannot simply tolerate injustice to employers if only to protect the welfare of undeserving employees.
As aptly put by then Associate Justice Leonardo A. Quisumbing:
Needless to say, so irresponsible an employee like petitioner does not deserve a place in the workplace, and
it is within the management’s prerogative xxx to terminate his employment. Even as the law is solicitous of
the welfare of employees, it must also protect the rights of an employer to exercise what are clearly
management prerogatives. As long as the company’s exercise of those rights and prerogative is in good
faith to advance its interest and not for the purpose of defeating or circumventing the rights of employees
under the laws or valid agreements, such exercise will be upheld.

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MAYON HOTEL & RESTAURANT, PACITA O. PO vs. ROLANDO ADANA, et al.
G.R. No. 157634
May 16, 2005

FACTS:

FACTS: Petitioner Mayon Hotel & Restaurant is a single proprietor business registered in the name of
petitioner Pacita O. Po,6 whose mother, petitioner Josefa Po Lam, manages the establishment.7 The hotel
and restaurant employed about sixteen (16) employees.

Due to the expiration and non-renewal of the lease contract for the rented space occupied by the said hotel
and restaurant at Rizal Street, the hotel operations of the business were suspended on March 31, 1997.9 The
operation of the restaurant was continued in its new location at Elizondo Street, Legazpi City, while
waiting for the construction of a new Mayon Hotel & Restaurant at Peñaranda Street, Legazpi City.10Only
nine (9) of the sixteen (16) employees continued working in the Mayon Restaurant at its new site.

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The 16 employees filed complaints for underpayment of wages and other money claims against petitioners.
Executive Labor Arbiter Gelacio L. Rivera, Jr. rendered a Joint Decision in favor of the employees. The
Labor Arbiter awarded substantially all of respondents’ money claims, and held that respondents Loveres,
Macandog and Llarena were entitled to separation pay, while respondents Guades, Nicerio and Alamares
were entitled to their retirement pay. The Labor Arbiter also held that based on the evidence presented,
Josefa Po Lam is the owner/proprietor of Mayon Hotel & Restaurant and the proper respondent in these
cases.
On appeal to the NLRC, the decision of the Labor Arbiter was reversed, and all the complaints were
dismissed.

Respondents filed a motion for reconsideration with the NLRC and when this was denied, they filed a
petition for certiorari with the CA. CA reversed the NLRC decision and the employers filed MR which was
denied, hence the case before the SC.

ISSUES:

1. Whether or not respondents were illegally dismissed by petitioner;

2. Whether or not respondents are entitled to their money claims due to underpayment of wages, and
nonpayment of holiday pay, rest day premium, SILP, COLA, overtime pay, and night shift differential pay.

HELD:

1. Illegal Dismissal: claim for separation pay

Since April 1997 until the time the Labor Arbiter rendered its decision in July 2000, or more than three (3)
years after the supposed “temporary” lay-off, the employment of all the respondents with petitioner had
ceased, notwithstanding that the new premises had been completed and the same resumed its operation.
This is clearly dismissal – or the permanent severance or complete separation of the worker from the
service on the initiative of the employer regardless of the reasons therefor.
Article 286 of the Labor Code is clear — there is termination of employment when an otherwise bona fide
suspension of work exceeds six (6) months. The cessation of employment for more than six months was
patent and the employer has the burden of proving that the termination was for a just or authorized cause.

While we recognize the right of the employer to terminate the services of an employee for a just or
authorized cause, the dismissal of employees must be made within the parameters of law and pursuant to
the tenets of fair play. And in termination disputes, the burden of proof is always on the employer to prove
that the dismissal was for a just or authorized cause. Where there is no showing of a clear, valid and legal
cause for termination of employment, the law considers the case a matter of illegal dismissal.

If doubts exist between the evidence presented by the employer and the employee, the scales of justice
must be tilted in favor of the latter — the employer must affirmatively show rationally adequate evidence
that the dismissal was for a justifiable cause. It is a time-honored rule that in controversies between a
laborer and his master, doubts reasonably arising from the evidence, or in the interpretation of agreements
and writing should be resolved in the former's favor. The policy is to extend the doctrine to a greater
number of employees who can avail of the benefits under the law, which is in consonance with the avowed
policy of the State to give maximum aid and protection of labor.

2. Money claims

The Supreme Court reinstated the award of monetary claims granted by the Labor Arbiter.

The cost of meals and snacks purportedly provided to respondents cannot be deducted as part of
respondents' minimum wage. As stated in the Labor Arbiter's decision.
Even granting that meals and snacks were provided and indeed constituted facilities, such facilities could
not be deducted without compliance with certain legal requirements. As stated in Mabeza v. NLRC, the

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employer simply cannot deduct the value from the employee's wages without satisfying the following: (a)
proof that such facilities are customarily furnished by the trade; (b) the provision of deductible facilities is
voluntarily accepted in writing by the employee; and (c) the facilities are charged at fair and reasonable
value. The law is clear that mere availment is not sufficient to allow deductions from employees' wages.

As for petitioners repeated invocation of serious business losses, suffice to say that this is not a defense to
payment of labor standard benefits. The employer cannot exempt himself from liability to pay minimum
wages because of poor financial condition of the company. The payment of minimum wages is not
dependent on the employer's ability to pay.

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