Republic of the Philippines

SUPREME COURT
Manila
EN BANC
G.R. No. L-7349 July 19, 1955
ATOK-BIG E!GE MUTUAL BENE"IT ASSOCIATION, petitioner,
vs.
ATOK-BIG E!GE MINING COMPAN#, INCORPORATE!, respondents.
Pablo C. Sanidad for petitioner.
Roxas and Sarmiento for respondents.
RE#ES, J. B. L., J.$
On September , !"#$, the petitioner labor union, the Ato%&Bi' (ed'e Mutual Benefit
Association, submitted to the Ato%&Bi' (ed'e Minin' Co., )nc. *respondent herein+ several
demands, amon' ,hich ,as an increase of P$.#$ in dail- ,a'e. .he matter ,as referred b- the
minin' compan- to the Court of )ndustrial Relations for arbitration and settlement *Case No.
#/0&1+. )n the course of conciliator- measures ta%en b- the Court, some of the demands ,ere
'ranted, and others *includin' the demand for increased ,a'es+ re2ected, and so, hearin's
proceeded and evidence submitted on the latter. On 3ul- !, !"#!, the Court rendered a decision
*Record, pp. /#&0/+ fi4in' the minimum ,a'e at P/.5# a da- ,ith the rice ration, or P0./$
,ithout rice ration6 den-in' the deduction from such minimum ,a'e, of the value of housin'
facilities furnished b- the compan- to the laborers, as ,ell as the efficienc- bonus 'iven to them
b- the compan-6 and ordered that the a,ard be made effective retroactivel- from the date of the
demand, September , !"#$, as a'reed b- the parties. 7rom this decision, the minin' compan-
appealed to this Court *8.R. No. 9&#/:5+.
Subse;uentl-, an ur'ent petition ,as presented in Court on October !#, !"#/ b- the Ato%&Bi'
(ed'e Minin' Compan- for authorit- to stop operations and la- off emplo-ees and laborers, for
the reason that due to the heav- losses, increased ta4es, hi'h cost of materials, ne'li'ible
;uantit- of ore deposits, and the enforcement of the Minimum (a'e 9a,, the continued
operation of the compan- ,ould lead to its immediate ban%ruptc- and collapse *Rec. pp. !$$&
!$"+. .o avert the closure of the compan- and the conse;uent la-&off of hundreds of laborers and
emplo-ees, the Court, instead of hearin' the petition on the merits, convened the parties for
voluntar- conciliation and mediation. After len'th- discussions and e4chan'e of vie,s, the
parties on October /", !"#/ reached an a'reement effective from Au'ust , !"#/ to <ecember
0!, !"# *Rec. pp. !=&/0+. .he A'reement in part provides>
)
.hat the petitioner, Ato%&Bi' (ed'e Minin' Compan-, )ncorporated, a'rees to abide b-
,hatever decision that the Supreme Court ma- render ,ith respect to Case No. #/0&1
*8.R. #/:5+ and Case No. #/0&! *!$+ *8.R. ##"+.
4 4 4 4 4 4 4 4 4
)))
4 4 4 4 4 4 4 4 4
.hat the petitioner, Ato%&Bi' (ed'e Minin' Compan-, )ncorporated, and the respondent,
Ato%&Bi' (ed'e Mutual Benefit Association, a'ree that the follo,in' facilities
heretofore 'iven or actuall- bein' 'iven b- the petitioner to its ,or%ers and laborers, and
,hich constitute as part of their ,a'es, be valued as follo,s>
Rice ration
P.55 per
day
Housing facility
40 per
day
All other facilities such as
recreation facilities, medical
treatment to dependents of
laborers, school facilities, rice
ration during off-days, water,
light, fuel, etc., eui!alent to at
least
"5 per
day
)t is understood that the said amount of facilities valued at the abovementioned prices, ma- be
char'ed in full or partiall- b- the Ato%&Bi' (ed'e Minin' Compan-, )nc., a'ainst laborer or
emplo-ee, as it ma- see fit pursuant to the e4i'encies of its operation.
.he a'reement ,as submitted to the Court for approval and on <ecember /5, !"#/, ,as
approved b- the Court in an order 'ivin' it effect as an a,ard or decision in the case *Rec., p.
/+.
9ater, Case No. 8.R. No. 9&#/:5 ,as decided b- this Court *promul'ated March 0, !"#0+,
affirmin' the decision of the Court of )ndustrial Relations fi4in' the minimum cash ,a'e of the
laborers and emplo-ees of the Ato%&Bi' (ed'e Minin' Co. at P0./$ cash, ,ithout rice ration, or
P/.5#, ,ith rice ration. On 3une !0, !"#0, the labor union presented to the Court a petition for
the enforcement of the terms of the a'reement of October /", !"#/, as alle'edl- modified b- the
decision of this Court in 8.R. No. 9&#/:5 and the provisions of the Minimum (a'e 9a,, ,hich
has since ta%en effect, pra-in' for the pa-ment of the minimum cash ,a'e of P0.# a da- ,ith
rice ration, or P.$$ ,ithout rice ration, and the pa-ment of differential pa- from Au'ust , !"#/,
,hen the a,ard became effective. .he minin' compan- opposed the petition claimin' that the
A'reement of October /", !"#/ ,as entered into b- the parties ,ith the end in vie, that the
compan-?s cost of production be not increased in an- ,a-, so that it ,as intended to supersede
,hatever decision the Supreme Court ,ould render in 8.R. No. 9&#/:5 and the provisions of the
Minimum (a'e 9a, ,ith respect to the minimum cash ,a'e pa-able to the laborers and
emplo-ees. Sustainin' the opposition, the Court of )ndustrial Relations, in an order issued on
September //, !"#0 *Rec. pp. &"+, denied the petition, upon the 'round that ,hen the
A'reement of the parties of October /", !"#/ ,as entered into b- them, the- alread- %ne, the
decision of said Court *althou'h sub2ect to appeal to the Supreme Court+ fi4in' the minimum
cash ,a'e at P0./$ ,ithout rice ration, or P/.5# ,ith rice ration, as ,ell as the provisions of the
Minimum (a'e 9a, re;uirin' the pa-ment of P minimum dail- ,a'e in the provinces
effective Au'ust , !"#/6 so that the parties had intended to be re'ulated b- their A'reement of
October /", !"#/. On the same da-, the Court issued another order *Rec. pp. #$&##+, den-in' the
claim of the labor union for pa-ment of an additional #$ per cent based on the basic ,a'e of P
for ,or% on Sunda-s and holida-s, holdin' that the pa-ments bein' made b- the compan- ,ere
,ithin the re;uirements of the la,. )ts motion for the reconsideration of both orders havin' been
denied, the labor union filed this petition for revie, b- certiorari.
.he first issue submitted to us arises from an apparent contradiction in the A'reement of October
/", !"#/. B- para'raph ))) thereof, the parties b- common consent evaluated the facilities
furnished b- the Compan- to its laborers *rice rations, housin', recreation, medical treatment,
,ater, li'ht, fuel, etc.+ at P!.=$ per da-, and authori@ed the compan- to have such value Achar'e
in full or partiall- B a'ainst an- laborer or emplo-ee as it ma- see fitA6 ,hile in para'raph ), the
Compan- a'reed to abide b- the decision of this Court *pendin' at the time the a'reement ,as
had+ in 8.R. No. 9&##"6 and as rendered, the decision ,as to the effect that the Compan- could
deduct from the minimum ,a'e onl- the value of the rice ration.
)t is contended b- the petitioner union that the t,o provisions should be harmoni@ed b- holdin'
para'raph ))) *deduction of all facilities+ to be merel- provisional, effective onl- ,hile this Court
had not rendered its decision in 8.R. No. 9&##"6 and that the terms of said para'raph should be
deemed superseded b- the decision from the time the latter became final, some four or five
months after the a'reement ,as entered into6 in conse;uence, *it is claimed+, the laborers became
entitled b- virtue of said decision to the prevailin' P.$$ minimum ,a'e ,ith no other deduction
than that of the rice ration, or a net cash ,a'e of P0.#.
.his contention, in our opinion, is untenable. .he intention of the parties could not have been to
ma%e the arran'ement in para'raph ))) a merel- provisional arran'ement pendin' the decision of
the Supreme Court for Athis a'reementA ,as e4pressl- made retroactive and effective as of
Au'ust , !"#/, and to be in force up to and includin' <ecember 0!, !"#A *Par. )1+. (hen
concluded on October /", !"#/, neither part- could anticipate the date ,hen the decision of the
Supreme Court ,ould be rendered6 nor is an- reason sho,n ,h- the parties should desire to
limit the effects of the decision to the period !"#/&!"# if it ,as to supersede the a'reement of
October /", !"#/.
.o ascertain the true import of para'raph ) of said A'reement providin' that the respondent
compan- a'reed to abide b- ,hatever decision the Supreme Court ,ould render in 8.R. No. 9&
#/:5, it is important to remember that, as sho,n b- the records, the a'reement ,as prompted b-
an ur'ent petition filed b- the respondent minin' compan- to close operations and la-&off
laborers because of heav- losses and the full enforcement of the Minimum (a'e 9a, in the
provinces, re;uirin' it to pa- its laborers the minimum ,a'e of P6 to avoid such eventualit-,
throu'h the mediation of the Court of )ndustrial Relations, a compromise ,as reached ,hereb- it
,as a'reed that the compan- ,ould pa- the minimum ,a'e fi4ed b- the la,, but the facilities
then bein' received b- the laborers ,ould be evaluated and char'ed as part of the ,a'e, but
,ithout in an- ,a- reducin' the P/.$$ cash portion of their ,a'es ,hich the- ,ere receivin'
prior to the a'reement *hearin' of Oct. /=, !"#/, C)R, t.s.n. :+. )n other ,ords, ,hile it ,as the
ob2ective of the parties to compl- ,ith the re;uirements of the Minimum (a'e 9a,, it ,as also
deemed important that the minin' compan- should not have to increase the cash ,a'es it ,as
then pa-in' its laborers, so that its cost of production ,ould not also be increased, in order to
prevent its closure and the la-&off of emplo-ees and laborers. And as found b- the Court belo,
in the order appealed from *,hich findin' is conclusive upon us+, Ait is this eventualit- that the
parties did not li%e to happen, ,hen the- have e4ecuted the said a'reementA *Rec. p. "+.
Accordin'l-, after said a'reement ,as entered into, the Compan- started pa-in' its laborers a
basic cash or Ata%e&homeA ,a'e of P/./$ *Rec. p. "+, representin' the difference bet,een P
*minimum ,a'e+ and P!.=$ *value of all facilities+.
(ith this bac%'round, the provision to abide b- our decision in 8.R. No. 9&#/:5 can onl- be
interpreted thus> .hat the compan- a'reed to pa- ,hatever a,ard this Court ,ould ma%e in said
case from the date fi4ed b- the decision *,hich ,as that of the ori'inal demand, September ,
!"#$+ up to Au'ust 0, !"#/ *the da- previous to the effectivit- of the Compromise A'reement+
and from Au'ust , !"# to <ecember 0!, !"#, the- are to be bound b- their a'reement of
October /", !"#/.
.his means that durin' the first period *September , !"#$ to Au'ust 0, !"#/+, onl- rice rations
'iven to the laborers are to be re'arded as formin' part of their ,a'e and deductible therefrom.
.he minimum ,a'e ,as then fi4ed *b- the Court of )ndustrial Relations, and affirmed b- this
Court+ at P0./$ ,ithout rice ration, or P/.5# ,ith rice ration. Since the respondent compan- had
been pa-in' its laborers the basic cash or Ata%e&homeA ,a'e of P/ prior to said decision and up
to Au'ust 0, !"#/, the laborers are entitled to a differential pa- of P$.5# per ,or%in' da- from
September , !"#$ *the date of the effectivit- of the a,ard in 8.R. 9&#/:5+ up to Au'ust 0, !"#/.
7rom Au'ust , !"#/, the date ,hen the A'reement of the parties of October /", !"#/ became
effective *,hich ,as also the date ,hen the Minimum (a'e 9a, became full- enforceable in
the provinces+, the laborers should be paid a minimum ,a'e of P a da-. 7rom this amount, the
respondent minin' compan- is 'iven the ri'ht to char'e each laborer Ain full or partiall-A, the
facilities enumerated in par. ))) of the A'reement6 i.e., rice ration at P$.## per da-, housin'
facilit- at P$.$ per da-, and other facilities Aconstitute part of his ,a'esA. )t appears that the
compan- had actuall- been pa-in' its laborers the minimum ,a'e of P/./$ since Au'ust ,
!"#/6 hence the- are not entitled to an- differential pa- from this date.
Petitioner ar'ues that to allo, the deductions stipulated in the A'reement of October /", !"#/
from the minimum dail- ,a'e of P ,ould be a ,aiver of the minimum ,a'e fi4ed b- the la,
and hence null and void, since Republic Act No. 5$/, section /$, provides that Ano a'reement or
contract, oral or ,ritten, to accept a lo,er ,a'e or less than an- other under this Act, shall be
validA. An a'reement to deduct certain facilities received b- the laborers from their emplo-er is
not a ,aiver of the minimum ,a'e fi4ed b- the la,. (a'e, as defined b- section / of Republic
Act No. 5$/, Aincludes the fair and reasonable value as determined b- the Secretar- of 9abor, of
board, lod'in', or other facilities customaril- furnished b- the emplo-er to the emplo-ee.A .hus,
the la, permits the deduction of such facilities from the laborer?s minimum ,a'e of P, as lon'
as their value is Afair and reasonableA. )t is not here claimed that the valuations fi4ed in the
A'reement of October /", !"#/ are not fair and reasonable. On the contrar-, the a'reement
e4pressl- states that such valuations>
Ahave been arrived at after careful stud- and deliberation b- both representatives of both
parties, ,ith the assistance of their respective counsels, and in the presence of the
Conorable Presidin' 3ud'e of the Court of )ndustrial RelationsA *Rec. p. /+.
Neither is it claimed that the parties, ,ith the aid of the Court of )ndustrial Relations in a dispute
pendin' before it, ma- not fi4 b- a'reement the valuation of such facilities, ,ithout referrin' the
matter to the <epartment of 9abor.
Petitioner also ar'ues that to allo, the deductions of the facilities appearin' in the
A'reement referred to, ,ould be contrar- to the mandate of section !" of the la,, that
Anothin' in this Act . . . 2ustif- an emplo-er . . . in reducin' supplements furnished on the
date of enactment.
.he meanin' of the term AsupplementsA has been fi4ed b- the Code of Rules and Re'ulations
promul'ated b- the (a'e Administration Office to implement the Minimum (a'e 9a, *Ch. !,
DcE+, as>
e4tra renumeration or benefits received b- ,a'e earners from their emplo-ees and
include but are not restricted to pa- for vacation and holida-s not ,or%ed6 paid sic% leave
or maternit- leave6 overtime rate in e4cess of ,hat is re;uired b- la,6 sic%, pension,
retirement, and death benefits6 profit&sharin'6 famil- allo,ances6 Christmas, ,ar ris% and
cost&of&livin' bonuses6 or other bonuses other than those paid as a re,ard for e4tra output
or time spent on the 2ob.
ASupplementsA, therefore, constitute e4tra renumeration or special privile'es or benefits 'iven to
or received b- the laborers over and above their ordinar- earnin's or ,a'es. 7acilities, on the
other hand, are items of e4pense necessar- for the laborer?s and his famil-?s e4istence and
subsistence, so that b- e4press provision of the la, *sec. / D'E+ the- form part of the ,a'e and
,hen furnished b- the emplo-er are deductible therefrom since if the- are not so furnished, the
laborer ,ould spend and pa- for them 2ust the same. )t is thus clear that the facilities mentioned
in the a'reement of October /", !"#/ do not come ,ithin the term AsupplementsA as used in Art.
!" of the Minimum (a'e 9a,.
7or the above reasons, ,e find the appeal from the Order of the Court a quo of September //,
!"#0 den-in' the motion of the petitioner labor union for the pa-ment of the minimum ,a'e of
P0.# per da- plus rice ration, or P ,ithout rice ration, to be unmeritorious and untenable.
.he second ;uestion involved herein relates to the additional compensation that should be paid
b- the respondent compan- to its laborers for ,or% rendered on Sunda-s and holida-s. )t is
admitted that the respondent compan- is pa-in' an additional compensation of #$ per cent based
on the basic Acash portionA of the laborer?s ,a'e of P/./$ per da-6 i.e., P!.!$ additional
compensation for each Sunda- or holida-?s ,or%. Petitioner union insists, ho,ever, that this #$
per cent additional compensation should be computed on the minimum ,a'e of P$$ and not on
the Acash portionA of the laborer?s ,a'e of P/./$, under the provisions of the A'reement of
October /", !"#/ and the Minimum (a'e 9a,.
SEC. . Common,ealth Act No. *other,ise %no,n as the Ei'ht Cour 9abor 9a,+ provides>
No person, firm, or corporations, business establishment or place or center of labor shall
compel an emplo-ee or laborer to ,or% durin' Sunda-s and holida-s, unless he is paid an
additional sum of at least t,ent-&five per centum of his re'ular renumeration>
.he minimum le'al additional compensation for ,or% on Sunda-s and le'al holida-s is,
therefore, /# per cent of the laborer?s re'ular renumeration. Fnder the Minimum (a'e 9a,, this
minimum additional compensation is P! a da- */# per cent of P, the minimum dail- ,a'e+.
(hile the respondent compan- computes the additional compensation 'iven to its laborers for
,or% on Sunda-s and holida-s on the Acash portionA of their ,a'es of P/./$, it is 'ivin' them #$
per cent thereof, or P!.!$ a da-. Considerin' that the minimum additional compensation fi4ed b-
the la, is P! */# per cent of P+, the compensation bein' paid b- the respondent compan- to its
laborers is even hi'her than such minimum le'al additional compensation. (e, therefore, see no
error in the holdin' of the Court a quo that the respondent compan- has not violated the la, ,ith
respect to the pa-ment of additional compensation for ,or% rendered b- its laborers on Sunda-s
and le'al holida-s.
7indin' no reason to sustain the present petition for revie,, the same is, therefore, dismissed,
,ith costs a'ainst the petitioner Ato%&Bi' (ed'e Mutual Benefit Association.
Bengzon, Acting C.J., Padilla, Montemaor, Rees, A., Jugo, Bautista Angelo, !abrador, and
Concepcion, JJ., concur.