*Define Facilities and Supplements

*Art. 97, LC
-facilities could not be deducted without the employer complying first with
certain legal requirements.
a. proof must be shown that such facilities are customarily furnished by the
trade;
b. the provision of deductible facilities must be voluntarily accepted in writing
by the employee; and
c. the facilities must be charges at a fair and reasonable value -

-food or snacks or other convenience provided by the employers are deemed

as supplements if they are granted for the convenience of the employer.(MABEZA V
NLRC)
-subsidized meals and free lodging provided by employer are supplements.
(OUR HAUS REALTY v. PARIAN)
*The Purpose Test
-Under the law, only the value of the facilities may be deducted from the
employee's wages but not the value of supplements.
-Under this test, if a benefit or privilege granted to the employee is clearly for
the employers convenience, it will not be considered as a facility but a supplement.
-recognizes that the employer and the employee do not stand at the same
bargaining positions on benefits that must or must not formpart of an employees
wage. In the ultimate analysis, the purpose test seeks to prevent a circumvention of
the minimum wage law.(OUR HAUS REALTY v. PARIAN)

*DOLE Memorandum Circular No. 2

-an employer may provide subsidized meals and snacks to his employees provided
that the subsidy shall not be less that 30% of the fair and reasonable value of such
facilities. In such cases, the employer may deduct from the wages of the employees
not more than 70% of the value of the meals and snacks enjoyed by the latter,
provided that such deduction is with the written authorization of the employees
concerned.