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Saturday, October 4, 2014

Atok Big Wedge Mutual Benefit Association v Atok Big Wedge Mining Co. Inc (1955)

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 laborer’s 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 laborer’s and his family’s 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.

Victor Morvis

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