Annex B cannot be construed as modifying or altering the terms expressed in the body of the
30. CALTEX REGULAR EMPLOYEES AT MANILA OFFICE, LEGAZPI BULK DEPOT AND MARIN-
DUQUE BULK DEPOT, vs. CALTEX (PHILIPPINES), INC. and NATIONAL LABOR RELATIONS
COMMISSION (FIRST DIVISION)
G.R. No. 111359, August 15, 1995
Topic: Rest Periods and Holidays
PLAINTIFF: Caltex Regular Employees at Manila Office, Legazpi Bulk Depot and Marinduque
Bulk Depot
DEFENDANT: NLRC
PRIVATE RESPONDENT: Caltex
FACTS:
1. On Dec 12, 1985, the parties entered into a Collective Bargaining Agreement (“1985
CBA”) in conformity with the Labor Code. Annex B of the 1985 CBA provides for the
computation of regular day pay, overtime pay, night shift differential pay, day off
pay, excess of 40 hrs within a calendar week, Sunday premium pay, holiday premium
pay.
2. In Aug 1986, the Union called Caltex’s attention to its alleged violations of Annex B
for non-payment of night-shift differentials, overtime pay and “first day-off rates”
for work performed on a Saturday.
3. Caltex’s Industrial Relations Manager evaluated petitioners’ claims and accordingly
informed the Union that differential payments would be timely implemented. How-
ever, no differential payment was made with respect to work performed on the first
2 ½ hours on a Saturday.
4. Union instituted a complaint for unfair labor practice for shortchanging its employ-
ees when Caltex compensated work performed on the first 2 ½ hours of Saturday,
an employees’ day of rest, at regular rates, when it should be paying t “day of rest”
or “day off” rates.
5. Caltex averred that Saturday was never designated as a day of rest, much less a “day
off”; that the CBA provided only 1 day of rest – which is Sunday.
6. LABOR ARBITER: In favor of Union, while finding at the same time that Caltex was
not guilty of any unfair labor practice.
7. NLRC: Set aside LA – conclusions were not supported by evidence on record. That the
CBA granted only 1 day of rest.
ISSUE/S and RULING:
1. W/N the interpretation of the 1985 is to provide employees 1 day of rest? YES.
The plain and ordinary meaning of the language of Article III is that Caltex and the Union had
agreed to pay "day of rest" rates for work performed on "an employee's one day of rest". To
the Court's mind, the use of the word "one" describing the phrase "day of rest [of an em-
ployee]" emphasizes the fact that the parties had agreed that only a single day of rest shall be
scheduled and shall be provided to the employee.
agreement contained in the 1985 CBA. It did not confer any rights upon employees repre-
sented by the Union; neither did it impose any obligations upon Caltex. It was intended to
serve as a company-wide guide in computing compensation for work performed by all its em-
ployees.
Private respondent also points out that the mathematical formulae contained in Annex "B" are
not all applicable to all classes of employees, there being some formulae applicable only to
particular groups or classes of employees. Thus, "First Day-off rates" and "Second Day-off
rates" are applicable only to employees stationed at the refinery and associated facilities like
depots and terminals which must be in constant twenty-four (24) hours a day, seven (7) days
a week, operation, hence necessitating the continuous presence of operations personnel. The
work of such operations personnel required them to be on duty for six (6) consecutive days.
Upon the other hand, "First Day-off rates" and "Second Day-off rates" are not applicable to
personnel of the Manila Office which consisted of other groups or categories of employees
(e.g., office clerks, librarians, computer operators, secretaries, collectors, etc.),9 since the na-
ture of their work did not require them to be on duty for six (6) consecutive days.
2. W/N undertime work may be offset by an overtime work, respectively on separate days?
No.
Overtime work consists of hours worked on a given day in excess of the applicable work period,
which here is 8hrs. It is not enough that the hours worked fall on disagreeable or inconvenient
hours.
In order that work may be considered as overtime work, the hours worked must be in excess
of and in addition to the eight (8) hours worked during the prescribed daily work period, or the
forty (40) hours worked during the regular work week Monday thru Friday.
In the present case, under the 1985 CBA, hours worked on a Saturday do not, by that fact
alone, necessarily constitute overtime work compensable at premium rates of pay, contrary to
petitioner's assertion. These are normal or regular work hours, compensable at regular rates
of pay, as provided in the 1985 CBA; under that CBA, Saturday is not a rest day or a "day off".
It is only when an employee has been required on a Saturday to render work in excess of the
forty (40) hours which constitute the regular work week that such employee may be consid-
ered as performing overtime work on that Saturday. We consider that the statutory prohibition
against offsetting undertime one day with overtime another day has no application in the case
at bar.
In recapitulation, the parties' 1985 CBA stipulated that employees at the Manila Office, as well
as those similarly situated at the Legazpi and Marinduque Bulk Depots, shall be provided only
one (1) day of rest; Sunday, and not Saturday, was designated as this day of rest. Work per-
formed on a Saturday is accordingly to be paid at regular rates of pay, as a rule, unless the
employee shall have been required to render work in excess of forty (40) hours in a calendar
week. The employee must, however, have in fact rendered work in excess of forty (40) hours
before hours subsequently worked become payable at premium rates. We conclude that the
NLRC correctly set aside the palpable error committed by Labor Arbiter Guanio, when the latter
imposed upon one of the parties to the 1985 CBA, an obligation which it had never assumed

DISPOSITION: Petition DISMISSED for lack of merit.