Labor- digests
3. PHILIPPINE AIRLINES vs. NLRC et al
G.R. No. 132805
Feb. 2, 1999
FACTS: Private respondent Dr. Fabros was employed as
flight surgeon at petitioner company. He was assigned at
the PAL Medical Clinic and was on duty from 4:00 in the
afternoon until 12:00 midnight.
On Feb.17, 1994, at around 7:00 in the evening, Dr. FAbros
left the clinic to have his dinner at his residence, which was
abou t5-minute drive away. A few minutes later, the clinic
received an emergency call from the PAL Cargo Services.
One of its employeeshad suffered a heart attack. The nurse
on duty, Mr. Eusebio, called private respondent at home to
inform him of the emergency. The patient arrived at the
clinic at 7:50 in the evening and Mr. Eusebio immediately
rushed him to the hospital. When Dr. Fabros reached the
clinic at around 7:51 in the evening, Mr. Eusebio had
already left with the patient to the hospital. The patient
died the following day.
Upon learning about the incident, PAL Medical Director
ordered the Chief Flight Surgeon to conduct an
investigation. In his explanation, Dr. Fabros asserted that
he was entitled to a thirty-minute meal break; that he We are not impressed.
immediately left his residence upon being informed by Mr.
Eusebio about the emergency and he arrived at the clinic a Art. 83 and 85 of the Labor Code read:
few minutes later; that Mr. Eusebio panicked and brought
the patient to the hospital without waiting for him.
Finding private respondent's explanation unacceptable, the
management charged private respondent with
abandonment of post while on duty. He denied that he
abandoned his post on February 17, 1994. He said that he
only left the clinic to have his dinner at home. In fact, he
returned to the clinic at 7:51 in the evening upon being
informed of the emergency.
After evaluating the charge as well as the answer of
private respondent, he was given a suspension for three
months effective December 16, 1994.
Private respondent filed a complaint for illegal suspension
against petitioner.
On July 16, 1996, the Labor Arbiter rendered a decision
declaring the suspension of private respondent illegal. It
also ordered petitioner to pay private respondent the
amount equivalent to all the benefits he should have
received during his period of suspension plus P500,000.00
moral damages.
Petitioner appealed to the NLRC.
The NLRC, however, dismissed the appeal after finding
that the decision of the Labor Arbiter is supported by the
facts on record and the law on the matter. The NLRC
likewise denied petitioner's motion for reconsideration.
Hence, this petition.
ISSUE:
1. WON the nullifying of the 3-month suspension by the
NLRC erroneous.
2. WON the awarding of moral damages is proper.
HELD: The petition is PARTIALLY GRANTED. The portion of
the assailed decision awarding moral damages to private
respondent is DELETED. All other aspects of the decision are
AFFIRMED
1. The legality of private respondent's suspension:
Dr. Fabros left the clinic that night only to have his dinner at
his house, which was only a few minutes' drive away from
the clinic. His whereabouts were known to the nurse on duty
so that he could be easily reached in case of emergency.
Upon being informed of Mr. Acosta's condition, private
respondent immediately left his home and returned to the
clinic. These facts belie petitioner's claim of abandonment.
Petitioner argues that being a full-time employee, private
respondent is obliged to stay in the company premises for
not less than eight (8) hours. Hence, he may not leave the
company premises during such time, even to take his meals.
Art. 83. Normal hours of work. — The normal hours of
work of any employee shall not exceed eight (8) hours a
day.
Health personnel in cities and municipalities with a
population of at least one million (1,000,000) or in
hospitals and clinics with a bed capacity of at least one
hundred (100) shall hold regular office hours for eight (8)
hours a day, for five (5) days a week, exclusive of time
for meals, except where the exigencies of the service
require that such personnel work for six (6) days or forty-
eight (48) hours, in which case they shall be entitled to
an additional compensation of at least thirty per cent
(30%) of their regular wage for work on the sixth day. For
purposes of this Article, "health personnel" shall include:
resident physicians, nurses, nutritionists, dieticians,
pharmacists, social workers, laboratory technicians,
paramedical technicians, psychologists, midwives,
attendants and all other hospital or clinic personnel.
(emphasis supplied)
Art. 85. Meal periods. — Subject to such regulations as
the Secretary of Labor may prescribe, it shall be the duty
of every employer to give his employees not less than
sixty (60) minutes time-off for their regular meals.
Sec. 7, Rule I, Book III of the Omnibus Rules
Implementing the Labor Code further states:
Sec. 7. Meal and Rest Periods. — Every employer shall
give his employees, regardless of sex, not less than one
(1) hour time-off for regular meals, except in the
following cases when a meal period of not less than
twenty (20) minutes may be given by the employer
Labor- digests
provided that such shorter meal period is credited as
compensable hours worked of the employee;

(a) Where the work is non-manual work in nature or

does not involve strenuous physical exertion;

(b) Where the establishment regularly operates not

less than sixteen hours a day;

(c) In cases of actual or impending emergencies or

there is urgent work to be performed on machineries,
equipment or installations to avoid serious loss which
the employer would otherwise suffer; and

(d) Where the work is necessary to prevent serious loss

of perishable goods.

Rest periods or coffee breaks running from five (5) to

twenty (20) minutes shall be considered as
compensable working time.

Thus, the eight-hour work period does not include

the meal break. Nowhere in the law may it be inferred
that employees must take their meals within the company
premises. Employees are not prohibited from going out of
the premises as long as they return to their posts on time.
Private respondent's act, therefore, of going home to take
his dinner does not constitute abandonment.

2. The award of moral damages:

Not every employee who is illegally dismissed or

suspended is entitled to damages. As a rule, moral
damages are recoverable only where the dismissal or
suspension of the employee was attended by bad faith or
fraud, or constituted an act oppressive to labor, or was
done in a manner contrary to morals, good customs or
public policy

In the case at bar, there is no showing that the

management of petitioner company was moved by some
evil motive in suspending private respondent. It suspended
private respondent on an honest, albeit erroneous, belief
that private respondent's act of leaving the company
premises to take his meal at home constituted
abandonment of post which warrants the penalty of
suspension. Under the circumstances, we hold that private
respondent is not entitled to moral damages.
Labor- digests
4. PNB V PNB EMPLOYEES ASSOCIATION
115 SCRA 507
July 30, 1982
NATURE
Appeal from decision of the Court of Industrial Relations
(CIR)
FACTS
- PNB and PNB Employees Association (PEMA) had a
dispute regarding the proper computation of overtime pay.
PEMA wanted the cost of living allowance (granted in 1958)
and longevity pay (granted in 1961) to be included in the
computation. PNB disagreed and the 2 parties later went
before the CIR to resolve the dispute.
- CIR decided in favor of PEMA and held that PNB should
compute the overtime pay of its employees on the basis of
the sum total of the employee’s basic salary or wage plus
cost of living allowance and longevity pay. The CIR relied
on the ruling in NAWASA v NAWASA Consolidated Unions,
which held that “for purposes of computing overtime
compensation, regular wage includes all payments which
the parties have agreed shall be received during the work
week, including differentiated payments for working at
undesirable times, such as at night and the board and
lodging customarily furnished the employee.” This
prompted PNB to appeal, hence this case.
ISSUE
WON the cost of living allowance and longevity pay should
be
included in the computation of overtime pay as held by the
CIR
HELD
NO
Ratio Overtime pay is for extra effort beyond that
contemplated in the employment contract; additional pay
given for any other purpose cannot be included in the basis
for the computation of overtime pay.
- Absent a specific provision in the CBA, the bases for the
computation of overtime pay are 2 computations, namely:
1. WON the additional pay is for extra work done or service
rendered
2. WON the same is intended to be permanent and regular,
not contingent nor temporary as a given only to remedy a
situation which can change any time.
Reasoning
- Longevity pay cannot be included in the computation of
overtime pay for the very simple reason that the contrary
is expressly stipulated in the CBA, which constitutes the
law between the parties.
- As regards cost of living allowance, there is nothing in
Commonwealth Act 444 [or “the 8-hour Labor Law,” now
Art. 87 Labor Code] that could justify PEMA’s posture that it
should be added to the regular wage in computing
overtime pay. C.A. 444 prescribes that overtime work shall
be paid “at the same rate as their regular wages or salary,
plus at least 25% additional.” The law did not define what is
a regular wage or salary. What the law emphasized is that in
addition to “regular wage,” there must be paid an additional
25% of that “regular wage” to constitute overtime rate of
pay. Parties were thus allowed to agree on what shall be
mutually considered regular pay from or upon which a 25%
premium shall be based and added to makeup overtime
compensation.
- No rule of universal application to other cases may be
justifiably extracted from the NAWASA case. CIR relies on the
part of the NAWASA decision where the SC cited American
decisions whose legislation on overtime is at variance with
the law in this jurisdiction. The US legislation considers work
in excess of forty hours a week as overtime; whereas, what is
generally considered overtime in the Philippines is work in
excess of the regular 8 hours a day. It is understandably
material to refer to precedents in the US for purposes of
computing weekly wages under a 40-hour week rule, since
the particular issue involved in NAWASA is the conversion of
prior weekly regular earnings into daily rates without
allowing diminution or addition.
- To apply the NAWASA computation would require a
different formula for each and every employee. It would
require reference to and continued use of individual earnings
in the past, thus multiplying the administrative difficulties of
the Company. It would be cumbersome and tedious a
process to compute overtime pay and this may again cause
delays in payments, which in turn could lead to serious
disputes. To apply this mode of computation would retard
and stifle the growth of unions themselves as Companies
would be irresistibly drawn into denying, new and additional
fringe benefits, if not those already existing, for fear of
bloating their overhead expenses through overtime which,
by reason of being unfixed, becomes instead a veritable
source of irritant in labor relations.
**Overtime Pay Rationale Why is a laborer or employee who
works beyond the regular hours of work entitled to extra
compensation called, in this enlightened time, overtime pay?
Verily, there can be no other reason than that he is made to
work longer than what is commensurate with his agreed
compensation for the statutorily fixed or voluntarily agreed
hours of labor he is supposed to do. When he thus spends
additional time to his work, the effect upon him is multi-
faceted; he puts in more effort, physical and/or mental; he is
delayed in going home to his family to enjoy the comforts
thereof; he might have no time for relaxation, amusement or
sports; he might miss important pre-arranged engagements;
etc. It is thus the additional work, labor or service employed
and the adverse effects just mentioned of his longer stay in
his place of work that justify and are the real reasons for the
extra compensation that is called overtime pay.
**Overtime Pay Definition The additional pay for service or
work rendered or performed in excess of 8 hours a day by
employees or laborers in employment covered by the 8 hour
Labor Law [C.A. 444, now Art. 87 Labor Code] and not
exempt from its requirements. It is computed by multiplying
Labor- digests
the overtime hourly rate by the number of hours worked in
excess of eight.

Disposition decision appealed from is REVERSED

Labor- digests
6. SALAZAR VS. NLRC
G.R. No 109210
APRIL 17, 1996
FACTS: On 17 April 1990, private respondent Carlos
Construction, at a monthly salary of P4,500.00, employed
Salazar as construction/project engineer for the
construction of a building in Cubao. Allegedly, by virtue of
an oral contract, petitioner would also receive a share in
the profits after completion of the project and that
petitioner's services in excess of 8 ours on regular days
and services rendered on weekends and legal holidays
shall be compensable overtime.
On 16 April 1991, petitioner received a memorandum
issued by private respondent's project manager informing
him of the termination of his services effective on 30 April
1991.
On 13 September 1991, Salazar filed a complaint against
private respondent for illegal dismissal, unfair labor
practice, illegal deduction, non-payment of wages,
overtime rendered, service incentive leave pay,
commission, allowances, profit-sharing and separation pay
with the NLRC-NCR Arbitration Branch, Manila.
The Labor Arbiter rendered a decision dismissing the
instant case for lack of merit. Petitioner appealed to the
NLRC, where it affirmed in toto the decision of the Labor
Arbiter. His MR was likewise dismissed. Hence the instant
petition.
ISSUE:
1) WON petitioner is entitled to overtime pay, premium pay
for services rendered on rest days and holidays and service
incentive leave pay
2) WON petitioner is entitled to a share in the profits of the
construction project;.
3) WON petitioner rendered services from 1 May to 15 May
1991 and is, therefore, entitled to unpaid wages;
4) WON private respondent is liable to reimburse
petitioner's legal expenses and;
5) WON petitioner is entitled to separation pay.
HELD: The assailed decision is modified.
1. NO. Although petitioner cannot strictly be classified as a complaint not in his personal capacity but in his capacity as
managerial employee, nonetheless he is still not entitled project engineer of private respondent and the case arose in
to payment of the aforestated benefits because he falls connection with his work as such. At the construction site,
squarely under another exempt category — "officers or petitioner is the representative of private respondent being
members of a managerial staff" as defined under sec. 2(c) its employee and he acts for and in behalf of private
of the abovementioned implementing rules:
Sec. 2. Exemption. — The provisions of this Rule shall
not apply to the following persons if they qualify for
exemption under the condition set forth herein:xxx
(c) Officers or members of a managerial staff xxx
That petitioner was paid overtime benefits does not
automatically and necessarily denote that petitioner is
entitled to such benefits
2. NO. petitioner insists that private respondent
promised him a share in the profits after completion of the
construction project. It is because of this oral agreement,
petitioner elucidates, that he agreed to a monthly salary of
P4,500.00, an amount which he claims is too low for a
professional civil engineer like him with the rank of project
engineer.
We cannot accede to petitioner's demand. Nowhere in the
disbursement vouchers can we find even the remotest hint of
a profit-sharing agreement between petitioner and private
respondent. Petitioner's rationalization stretches the
imagination way too far.
Also, as said by the Labor Arbiter:
As to the issue of profit sharing, we simply cannot grant the
same on the mere basis of complainant's allegation that
respondent verbally promised him that he is entitled to a
share in the profits derive(d) from the projects. Benefits or
privileges of this nature (are) usually in writing, besides
complainant failed to (establish) that said benefits or
privileges (have) been given to any of respondent('s)
employees as a matter of practice or policy.
3. YES. On April 30, he was advised by the Manager to
continue supervising the finishing touches to the building
until May 15, the date appearing in the Certificate of Service
as the date of the termination of the contract between
Salazar and the Company. But the Manager insists that
Salazar’s services terminated at April 30 according to the
Memorandum given the petitioner.
The purpose for which the said certificate was issued
becomes irrelevant. The fact remains that private respondent
knowingly and voluntarily issued the certificate. Mere denials
and self-serving statements to the effect that petitioner
allegedly promised not to use the certificate against private
respondent are not sufficient to overturn the same. Hence,
private respondent is estopped from assailing the contents of
its own certificate of service.
4. YES. During the construction of the building, a criminal
complaint for unjust vexation was filed against the officers of
the owner of the building. Petitioner avers that he was
implicated in the complaint for the sole reason that he was
the construction engineer of the project.
Although not directly implicated in the criminal complaint,
Carlos Construction is nonetheless obligated to defray
petitioner's legal expenses. Petitioner was included in the
respondent. Hence, the inclusion of petitioner in the
complaint for unjust vexation, which was work-related, is
equivalent to inclusion of private respondent itself.
5. NO. On the last issue, we rule that petitioner is a project
employee and, therefore, not entitled to separation pay.
Labor- digests
The applicable provision is Article 280 of the Labor Code
which defines the term "project employee," thus:

Art. 280. Regular and Casual Employment. — The

provisions of written agreement to the contrary
notwithstanding and regardless of the oral
agreement of the parties, an employment shall be
deemed to be regular where the employee has been
engaged to perform activities which are usually
necessary or desirable in the usual business or trade
of the employer, except where the employment has
been fixed for a specific period or undertaking the
completion or termination of which has been
determined at the time of the engagement of the
employee or where the work or services to be
performed is seasonal in nature and the employment
is for the duration of the season. (Emphasis ours.)

In the case at bench, it was duly established that private

respondent hired petitioner as project or construction
engineer specifically for its Monte de Piedad building
project. Accordingly, as project employee, petitioner's
services are deemed coterminous with the project, that is,
petitioner's services may be terminated as soon as the
project for which he was hired is completed. There can be
no dispute that petitioner's dismissal was due to the
completion of the construction of the building.

NOTES:

1. Although we agree with private respondent that appeals

to the SC from decisions of the NLRC should be in the form
of a special civil action for certiorari under Rule 65 of the
Revised Rules of Court, this rule is not inflexible. In a
number of cases this Court has resolved to treat as special
civil actions for certiorari petitions erroneously captioned
as petitions for review on certiorari "in the interest of
justice."

2. Policy Instruction No. 20 entitled "Stabilizing Employer-

Employee Relations in the Construction Industry" explicitly
mandates that:

xxx xxx xxx

Project employees are not entitled to termination pay if

they are terminated as a result of the completion of the
project or any phase thereof in which they are employed,
regardless of the number of projects in which they have
been employed by a particular construction company.
Moreover, the company is not required to obtain a
clearance from the Secretary of Labor in connection with
such termination. What is required of the company is a
report to the nearest Public Employment Office for
statistical purposes.
Labor- digests
8. GLOBAL INC. vs. ATIENZA ET AL
G.R. No.L-51612-13
JULY 22, 1986
FACTS: Rosal, herein private respondent, commenced her
employment with petitioner Global Incorporated in
February, 1970, as a "Sales Clerk." In November 1976
Global Inc. filed with the Department of Labor Regional
Office, an application for clearance to terminate the
services of Clarita Rosal, for having violated company rules
and regulations by incurring repeated absences and
tardiness. The subject employee was placed under
preventive suspension on November 16, 1976
pending resolution of the application for clearance.c
Clarita Rosal filed her opposition to the clearance
application as well as a counter-complaint against Global
Inc., for illegal dismissal, overtime pay and premium pay.
The officer-in-charge of Regional Office, Ministry of labor
Leogardo, Jr. lifted the preventive suspension of Clarita
Rosal, finding her suspension not warranted, and
reinstated her to her former position without loss of rights
and with full backwages from the time of preventive
suspension up to the date of her actual reinstatement.
The Labor Arbiter rendered his decision dismissing the
complaint for illegal dismissal, overtime compensation and
premium pay, and the clearance for the complainant’s
termination is granted.
Rosal appealed the aforesaid decision to the
NLRC.Respondents Commissioners Atienza and Quadra
modified the appealed decision, whereby:
(a) respondent is ordered to pay complainant overtime
pay for the period Nov. 1, 1974 to Nov. 16, 1976 when
she was suspended;
(b) respondent is likewise ordered to pay complainant
backwages from Dec. 2, 1976 to May 31, 1978;
(c) the decision of the Labor Arbiter granting clearance
to terminate the services of the complainant is
affirmed.
Respondent Commissioner Villatuya voted to affirm the
Labor Arbiter's decision. Hence, the instant petition.
ISSUE: WON
1. Rosal is entitled to overtime pay
2. Rosal is entitled to backwages
HELD: The assailed decision of the NLRC is modified,
where the order to pay overtime pay to Rosal is set aside,
the order to pay Rosal backwages affirmed, and the
decision granting clearance to terminate the services of
Rosal likewise affirmed
1. NO. We agree with the conclusion of the Labor Arbiter
that the same should be denied for want of sufficient
factual and legal basis. No employee is authorized to work
after office hours, during Sundays and Holidays unless
required by a written memorandum from the General
Manager. During the period from Nov. 1, 1974 to Nov. 16,
1976, no employee of the company was never required to
work after 5:00 in the afternoon. There is nothing in the
record except her bare allegations which would show that
she truly and actually rendered said overtime work
2. YES. the NLRC ordered petitioner to pay Rosal "backwages
from Dec. 2, 1976 to May 31, 1978", the date when Asst.
Secretary Leogardo, Jr., rendered his decision lifting the
preventive suspension of Rosal and ordering petitioner to
reinstate her to her former position without loss of rights and
with full backwages from the time of preventive suspension
up to the date of her actual reinstatement.c
We agree. We note that this decision of the Labor Arbiter
ordering reinstatement had not been complied with. Neither
was it appealed by petitioner, therefore, the decision had
become final and executory. To exempt petitioner from the
payment of backwages would be to give premium to the
blant disregard of orders of the Ministry of Labor. Moreover,
it would be in consonance with compassionate justice that
Rosal be paid backwages during the period that she was
supposed to be reinstated
Note that the only ground for the imposition of preventive
suspension is provided for under Sec. 4, Rule XIV of the
Implementing Regulations of the Ministry of Labor which
reads-
SEC. 4. Preventive suspension. The employer may
place the employee concerned under preventive
suspension only if the continued employment of the
employee poses a serious and imminent threat to the
life or property of the employer or of the co-employees.
Any preventive suspension before the filing of the
application shall be considered worked days, and shall
be duly paid as such if the continued presence of the
employee concerned does not pose a serious threat to
the life and property of the employer or of the co-
employees.
As aptly held by Asst. Secretary Leogardo Jr., the continued
presence of Clarita Rosal never posed a serious and
imminent threat to the life or property of the employer or co-
employees as would warrant her preventive suspension
Labor- digests
9. LAGATIC VS. NLRC ET AL TO SALARY DIFFERENTIALS, BACKWAGES, SEPARATION PAY,
G.R. No. 121004 OVERTIME PAY, REST DAY PAY, UNPAID COMMISSIONS,
JAN. 28, 1998 MORAL AND EXEMPLARY DAMAGES AND ATTORNEY'S FEES.

FACTS: Petitioner Lagatic was employed by Cityland, first HELD:

as a probationary sales agent, and later on as a marketing
specialist. He was tasked with soliciting sales for the 1. To constitute a valid dismissal from employment, two
company, with the corresponding duties of accepting call- requisites must be met, namely:
ins, referrals, and making client calls and cold calls. Cold (1) the employee must be afforded due process, and
calls refer to the practice of prospecting for clients through (2) the dismissal must be for a valid cause
the telephone directory. Cityland, believing that the same
is an effective and cost-efficient method of finding clients, Petitioner loses sight of the fact that "(e)xcept as provided
requires all its marketing specialists to make cold for, or limited by, special laws, an employer is free to
calls. Likewise, in order to assess cold calls made by the regulate, according to his discretion and judgment, all
sales staff, as well as to determine the results thereof, aspects of employment." Employers may, thus, make
Cityland requires the submission of daily progress reports reasonable rules and regulations for the government of their
on the same. employees, and when employees, with knowledge of an
established rule, enter the service, the rule becomes a part
Cityland issued a written reprimand to petitioner for his of the contract of employment. It is also generally recognized
failure to submit cold call reports for some time. This that company policies and regulations, unless shown to be
notwithstanding, petitioner again failed to submit cold call grossly oppressive or contrary to law, are generally valid and
reports. Petitioner was required to explain his inaction, with binding on the parties and must be complied with.
a warning that further non-compliance would result in his "Corollarily, an employee may be validly dismissed for
termination from the company. In a reply, petitioner violation of a reasonable company rule or regulation adopted
claimed that the same was an honest omission brought for the conduct of the company business. An employer
about by his concentration on other aspects of his job. cannot rationally be expected to retain the employment of a
Cityland found said excuse inadequate and suspended him person whose . . . lack of regard for his employer's rules . . .
for three days, with a similar warning. has so plainly and completely been bared." Petitioner's
continued infraction of company policy requiring cold call
reports, as evidenced by the 28 instances of non-submission
Notwithstanding the aforesaid suspension and warning, of aforesaid reports, justifies his dismissal.
petitioner again failed to submit cold call reports. He was
verbally reminded to submit the same and was even given Moreover, petitioner made it worse for himself when he
up a due date to do so. Instead of complying with said wrote the statement, "TO HELL WITH COLD CALLS! WHO
directive, petitioner wrote a note, "TO HELL WITH COLD CARES?" When required to explain, he merely denied ally
CALLS! WHO CARES?" and exhibited the same to his co- knowledge of the same. Cityland, on the other hand,
employees. submitted the affidavits of his co-employees attesting to his
authorship of the same. Petitioner's only defense is denial.
Petitioner received a memorandum requiring him to The rule, however, is that denial, if unsubstantiated by clear
explain why Cityland should not make good its previous and convincing evidence, is negative and self-serving
warning for his failure to submit cold call reports, as well as evidence which has no weight in law.
for issuing the written statement aforementioned. He sent Based on the foregoing, we find petitioner guilty of willful
a letter-reply alleging that his failure to submit cold call disobedience. Willful disobedience requires the concurrence
reports should trot be deemed as gross insubordination. He of at least two requisites:
denied any knowledge of the damaging statement
allegedly made by him. a. the employee's assailed conduct must have been willful or
intentional, the willfulness being characterized by a wrongful
Finding petitioner guilty of gross insubordination, Cityland and perverse attitude; and
served a notice of dismissal upon him on February 26, b. the order violated must have been reasonable, lawful,
1993. made known to the employee and must pertain to the duties
which he had been engaged to discharge
Aggrieved by such dismissal, petitioner filed a complaint
against Cityland for illegal dismissal, illegal deduction, 2. With the finding that petitioner's dismissal was for a just
underpayment, overtime and rest day pay, damages and and valid cause, his claims for moral and exemplary
attorney's fees. The labor arbiter dismissed the petition for damages, as well as attorney's fees, must fail.
lack of merit. On appeal, the same was affirmed by the
NLRC; hence the present recourse. Also, petitioner failed to show his entitlement to overtime
and rest day pay due, to the lack of sufficient evidence as
ISSUE: Petitioner raises the following issues: to the number of days and hours when he rendered overtime
and rest day work. Entitlement to overtime pay must first be
established by proof that said overtime work was actually
1. WON RESPONDENT NLRC GRAVELY ABUSED ITS performed, before an employee may avail of said benefit.
DISCRETION IN NOT FINDING THAT PETITIONER WAS
ILLEGALLY DISMISSED;
NOTES:
2. WON RESPONDENT NLRC GRAVELY ABUSED ITS
DISCRETION IN RULING THAT PETITIONER IS NOT ENTITLED
Labor- digests
1. There is no law which requires employers to pay
commissions, and when they do so, as stated in the letter-
opinion of the DOLE dated February 19, 1993, "there is no
law which prescribes a method for computing
commissions. The determination of the amount of
commissions is the result of collective bargaining
negotiations, individual employment contracts or
established employer practice." Since the formula for the
computation of commissions was presented to and
accepted by petitioner, such prescribed formula is in order.
As to the allegation that said formula diminishes the
benefits being received by petitioner whenever there is a
wage increase, it must be noted that his commissions are
not meant to be in a fixed amount. In fact, there was no
assurance that he would receive any commission at all.
Non-diminution of benefits, as applied here, merely means
that the company may not remove the privilege of sales
personnel to earn a commission, not that they are entitled
to a fixed amount thereof.

2. In addition to the above, the labor arbiter and the NLRC

sanctioned Cityland’s practice of offsetting rest day or
holiday work with equivalent time on regular workdays on
the ground that the same is authorized by Department
Order 21, Series of 1990. As correctly pointed out by
petitioner, said D.O. was misapplied in this case. The D.O.
involves the shortening of the workweek from six days to
five days but with prolonged hours on those five days.
Under this scheme, non-payment of overtime premiums
was allowed in exchange for longer weekends for
employees. In the instant case, petitioner's workweek was
never compressed. Instead, he claims payment for work
over and above his normal 5 1/2 days of work in a week.
Applying by analogy the principle that overtime cannot be
offset by undertime, to allow off-setting would prejudice
the worker. He would be deprived of the additional pay for
the rest day work he has rendered and which is utilized to
offset his equivalent time off on regular workdays. To allow
Cityland to do so would be to circumvent the law on
payment of premiums for rest day and holiday work.