ABELLA, KAREN RIZEL B.

LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

POSEIDON FISHING
vs.
NLRC
482 SCRA 717

FACTS: Poseidon Fishing is a company engaged in the deep-sea fishing
industry. One of its boat crew was private respondent Estoquia. De Jesus is the
manager of Poseidon Fishing. Estoquia was employed by Poseidon in Jan 1988
as Chief Mate. After five years, he was promoted to Boat Captain. In 1999
Estoquia was demoted without reason to Radio Operator. As Radio Operator,
he monitored daily activities in their office and recorded in the duty logbook the
names of the callers and time of their calls.

On July 3, 2000 Estoquia failed to record a 7:25 a.m. call in one of the
logbooks. However, he was able to record the same in the other logbook. When
he reviewed the two logbooks, he noticed that he wasnt able to record the said
call in one of the logbooks so he immediately recorded it after the 7:30 a.m.
entry. The next morning de Jesus detected the entry error in the logbook. She
asked Estoquia to prepare an incident report to explain the reason for the said
oversight. That same day, Poseidons secretary summoned Estoquia to get his
separation pay. Estoquia refused to accept it as he believed he did nothing
illegal to warrant his immediate discharge.

Estoquia filed a complaint for illegal dismissal with the LA. Poseidon and de
Jesus asserted that Estoquia was a contractual or casual employee; when he
was engaged, it was made clear to him that he was being employed only on a
por viaje (per trip) basis and that his employment would be terminated at the
end of the trip for which he was being hired per the Kasunduan with him.
Petitioners also asserted that deep-sea fishing is a seasonal industry as
catching of fish could only be undertaken for a limited duration or seasonal
within a given year and thus Estoquia was a seasonal or project employee.

LA decided in favor of Estoquia, holding that Estoquia became a regular
employee after a year and had attained tenurial security. It ordered Poseidon to
reinstate him and pay full back wages. NLRC modified the decision, deducting
from Estoquias back wages as it was his negligence in the performance of his
work that brought about his termination. CA dismissed the petition for
certiorari.

ISSUE: Whether or not Estoquia was a seasonal or project employee

RULING: NO. The test to determine whether one is a project employee is W/N
the said employee was assigned to carry out a specific project or undertaking,
the duration and scope of which were specified at the time the employee was
engaged for that project. Petitioners have not shown that Estoquia was
informed that he will be assigned to a specific project or undertaking. Neither
has it been established that he was informed of the duration and scope of such
project or undertaking at the time of their engagement. Maraguinot Jr. v.
National Labor Relations Commission established that once a project or work
pool employee has been (1) continuously (vs. intermittently) re-hired by the
same employer for the same tasks or nature of tasks; and (2) these tasks are
vital, necessary and indispensable to the usual business or trade of the
employer, the employee must be deemed a regular employee.

ABELLA, KAREN RIZEL B.
LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

In Brent School Inc. v. Zamora 181 SCRA 702, the Court ruled that fixed-term
employment contracts are recognized as valid under the law despite Art 280 of
the LC. However, if circumstances show that periods have been imposed to
preclude acquisition of tenurial security by the employee, the fixed-term
contract should be disregarded for being contrary to public policy. In the case
at bar, the Kasunduan has such an objective: to frustrate the security of
tenure of Estoquia. Petitioners intent to evade the application of Art 280 is
unmistakable. In a span of 12 years, Estoquia worked for Poseidon first as a
Chief Mate, then Boat Captain, and later as Radio Operator. His job was
directly related to the deep-sea fishing business of Poseidon. His work was
necessary and important to the business of his employer. Inasmuch as
Estoquias functions are no doubt usually necessary or desirable in the usual
business or trade of Poseidon and he was hired continuously for 12 years for
the same nature of tasks, we are constrained to say that he belongs to the ilk of
regular employee.

Being one, private respondents dismissal without valid cause was illegal. And,
where illegal dismissal is proven, the worker is entitled to back wages and
other similar benefits without deductions or conditions.



































ABELLA, KAREN RIZEL B.
LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

SONGCO
vs.
NLRC
183 SCRA 610

FACTS: Zuellig (M) Inc. filed with the Department of Labor (RegionalOffice No.
4) a clearance to terminate the services of petitioners Jose Songco, Romeo
Cipres and Amancio Manuel due to alleged financial losses. However, the
petitioners argued that the company is not suffering any losses and the real
reason for their termination was their membership in the union. At the last
hearing of the case, the petitioner manifested that they no longer contesting
their dismissal, however, they argued that they should be granted a
separation pay. Each of the petitioners was receiving a monthly salary of P40,
000.00 plus commissions for every sale they made. Under the CBA entered by
the Zuellig Inc. and the petitioners, in Article XIV, Section 1(a), Any employee,
who is separated from employment due to old age, sickness, death or
permanent lay-off not due to the fault of said employee shall receive from the
company a retirement gratuity in an amount equivalent to one months salary
per year of service. One month of salary as used in this paragraph shall be
deemed equivalent to the salary at date of retirement; years of service shall be
deemed equivalent to total service credits, a fraction of at least six months
being considered one year, including probationary employment. Other basis for
petitioners contention are Article 284 of the Labor Code with regards to
reduction of personnel and Sections 9(b) and 10 of Rule 1, Book VI of the Rules
Implementing the Labor Code. The Labor Arbiter rendered his decision
directing the company to pay the complainants separation pay equivalent to
their one month salary (exclusive of commissions, allowances, etc.) for every
year of service that they have worked with the company. The petitioners
appealed to the NLRC but it was denied. Petitioner Romeo Cipres filed a Notice
of Voluntary Abandonment and Withdrawal of petition contending that he had
received, to his full and complete satisfaction, his separation pay. Hence, this
petition.

ISSUE: Whether or not earned sales commissions and allowances should be
included in the monthly salary of petitioners for the purpose of computation of
their separation pay.

RULING: The petition is granted. Petitioners contention that in arriving at the
correct and legal amount of separation pay due to them, whether under the
Labor Code or the CBA, their basic salary, earned sales commissions and
allowances should be added together. Insofar as whether the allowances should
be included in the monthly salary of petitioners for the purpose of computation
of their separation pay is concerned, this has been settled in the case of Santos
vs. NLRC, 76721, 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. In the issue of whether
commission should be included in the computation of their separation pay, it is
proper to define first commission. Blacks Law Dictionary defined commission
as the recompensed, compensation or reward of an agent, salesman, executor,
trustees, receiver, factor, broker or bailee, when the same is calculated as a
percentage on the amount of his transactions or on the profit to the principal.
The nature of the work of a salesman and the reason for such type of
remuneration for services rendered demonstrate clearly that the commission
are part of petitioners wage and salary. Some salesmen do not receive any
ABELLA, KAREN RIZEL B.
LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

basic salary but depend on commission and allowances or commissions alone,
are part of petitioners wage and salary. Some salesman do not received any
basic salary but depend on commission and allowances or commissions alone,
although an employer-employee relationship exist. In Soriano v. NLRC, it is
ruled then that, the commissions also claimed by petitioner (override
commission plus net deposit incentive) are not properly includible in such base
figure since such commissions must be earned by actual market transactions
attributable to petitioner. Applying this by analogy, since the commissions in
the present case were earned by actual market transactions attributable to
petitioners, these should be included in their separation pay. In the
computation thereof, what should be taken into account is the average
commissions earned during their last year of employment.









































ABELLA, KAREN RIZEL B.
LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

PHILIPPINE APPLIANCE CORP.
vs.
COURT OF APPEALS
430 SCRA 525

FACTS: During the collective bargaining negotiations between petitioner and
respondent union in 1997, petitioner offered the amount of P4, 000.00 to each
employee as an early conclusion bonus. Petitioner claims that this bonus
was promised as a unilateral incentive for the speeding up of negotiations
between the parties and to encourage respondent union to exert their best
efforts to conclude a CBA. Upon conclusion of the CBA negotiations, petitioner
accordingly gave this early signing bonus.
In view of the expiration of this CBA, respondent union sent notice to petitioner
of its desire to negotiate a new CBA. Petitioner and respondent union began
their negotiations. On October 22, 1999, after eleven meetings, respondent
union expressed dissatisfaction at the outcome of the negotiations and
declared a deadlock. A few days later, on October 26, 1999, respondent union
filed a Notice of Strike with the NCMB, Region IV in Calamba, Laguna, due to
the bargaining deadlock.
The conciliation meetings started with eighteen unresolved items between
petitioner and respondent union. At the meeting, respondent union accepted
petitioners proposals on fourteen items, leaving the following items unresolved:
wages, rice subsidy, signing, and retroactive bonus.
Petitioner and respondent union failed to arrive at an agreement concerning
these four remaining items. On January 2000, respondent union went on
strike at the petitioners plant. The strike lasted for eleven days and resulted in
the stoppage of manufacturing operations as well as losses for petitioner, which
constrained it to file a petition before the Department of Labor and
Employment. Labor Secretary assumed jurisdiction over the dispute and, on
January 2000, ordered the striking workers to return to work within twenty-
four hours from notice and directed petitioner to accept back the said
employees. It rendered decision fixing the amount of wage increase and
directed to conclude a CBA to include the items granted in the conference.
Petitioner contested on the awarding of signing bonus.
ISSUE: Whether the signing bonus is covered under the maintenance of
existing benefits.
RULING: The payment of signing bonus is not covered under the existing
benefits. The Court has consistently ruled that a bonus is not a demandable
and enforceable obligation. True, it may nevertheless be granted on equitable
considerations as when the giving of such bonus has been the companys long
and regular practice.
To be considered a regular practice, however, the giving of the bonus should
have been done over a long period of time, and must be shown to have been
consistent and deliberate. The test or rationale of this rule on long practice
requires an indubitable showing that the employer agreed to continue giving
the benefits knowing fully well that said employees are not covered by the law
requiring payment thereof.
Respondent does not contest the fact that petitioner initially offered a signing
bonus only during the previous CBA negotiation. Previous to that, there is no
ABELLA, KAREN RIZEL B.
LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

evidence on record that petitioner ever offered the same or that the parties
included a signing bonus among the items to be resolved in the CBA
negotiation. Hence, the giving of such bonus cannot be deemed as an
established practice considering that the same was given only once, that is,
during the 1997 CBA negotiation.




























ABELLA, KAREN RIZEL B.
LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

ASIAN TRANSMISSION CORPPORATION
vs.
COURT OF APPEALS
425 SCRA 478

FACTS: The Department of Labor and Employment (DOLE), through
Undersecretary Cresenciano B. Trajano, issued an Explanatory Bulletin,
wherein it clarified, that employees are entitled to 200% of their basic wage,
which, apart from being Good Friday, and, therefore, a legal holiday, is also
Araw ng Kagitingan, which is also a legal holiday, even if unworked. Despite
the explanatory bulletin, petitioner Asian Transmission Corporation opted to
pay its daily paid employees only 100% of their basic pay. Respondent Bisig ng
Asian Transmission Labor Union (BATLU) protested. In accordance with Step 6
of the grievance procedure of the Collective Bargaining Agreement existing
between petitioner and BATLU, the controversy was submitted for voluntary
arbitration. 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. 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; and that that the law, as
amended, enumerates 12 regular holidays for every year, and 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, is also
Holy Friday or Maundy Thursday." The Court of Appeals upheld the findings of
the Voluntary Arbitrator, holding that the Collective Bargaining Agreement
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 "there is no condition,
qualification or exception for any variance from the clear intent that all
holidays shall be compensated. 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." Hence, this petition.
ISSUE: Whether or not daily-paid employees are entitled to be paid for two
regular holidays which fall on the same day.
RULING: Holiday pay is a legislated benefit enacted as part of the
Constitutional imperative that the State shall afford protection to labor. 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.
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
ABELLA, KAREN RIZEL B.
LABOR STANDARDS
TH 5:30-7:30, S 1:00-2:30

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,
afford a worker the enjoyment of 12 paid regular holidays. The provision is
mandatory, regardless of whether an employee is paid on a monthly or daily
basis. Since a worker is entitled to the enjoyment of 12 paid regular holidays,
the fact that two holidays fall on the same date should not operate to reduce to
11 the 12 holiday pay benefits a worker is entitled to receive. It is elementary,
under the rules of statutory construction, that when the language of the law is
clear and unequivocal, the law must be taken to mean exactly what it says. In
the case at bar, there is nothing in the law which provides or indicates that the
entitlement to 12 days of holiday pay shall be reduced to 11 when two holidays
fall on the same day. In any event, Art. 4 of the Labor Code provide that all
doubts in the implementation and interpretation of its provisions, including its
implementing rules and regulations, shall be resolved in favor of labor. For the
working mans welfare should be the primordial and paramount consideration.
Moreover, Sec. 11, Rule IV, Book III of the Omnibus Rules to Implement the
Labor Code provides that "Nothing in the law or the rules shall justify an
employer in withdrawing or reducing any benefits, supplements or payments
for unworked regular holidays as provided in existing individual or collective
agreement or employer practice or policy. 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.