Leyte IV Electric Cooperative, Inc. v.

LEYECO IV Employees Union-ALU

Facts: On April 6, 1998, petitioner and respondent entered into a CBA, covering petitioner rank-and-file
employees, for a period of 5 years effective Jan. 1, 1998. Respondent, through Regional VP Vicente Casilan,
sent a letter to petitioner demanding holiday pay for all employees, as provided for in the CBA. Petitioner,
through its legal counsel, sent a reply to Casilan, explaining that after pursuing all available pay slips, it
found that it had paid all employees all the holiday pays enumerated in the CBA.

After exhausting the procedures of the grievance machinery, the parties agreed to submit the issue of the
interpretation and implementation of the CBA on the payment of holiday pay, for arbitration of the NCMB
RO-VIII.

Contention of Respondent: Alleged that it is not prevented from making separate demands for the
payment of regular holidays concomitant with the provisions of the CBA, with its supporting documents
consisting of a letter demanding payment of holiday pay, petitioners reply thereto and respondents
rejoinder, a computation in the amount of 1,054,393, for the unpaid legal holidays, and several pay slips.

Contention of Petitioner: Insisted payment of the holiday pay in compliance with the CBA provisions,
stating that payment was presumed since the formula used in determining the daily rate of pay of the
covered employees is Basic Monthly Salary divided by 30 days or Basic Monthly Salary multiplied by 12
divided by 360 days, thus with said formula, the employees are already paid their regular and special days,
the days when no work is done, the 51 unworked Sundays and the 51 unworked Saturdays.

Voluntary Arbitrator: Decided in favor of respondent, reasoning that petitioner failed to show that it
complied with the CBA mandate that holiday pay be reflected during any payroll period of occurrence
since the payroll slips did not reflect any payment of the paid holidays.

CA: Dismissed petitioners petition, reasoning that the recourse from a Voluntary Arbitrator is a petition
for review under Rule 43 of the 1997 Rules of Procedure, hence, the present petition for certiorari under
Rule 65 should be rejected, as such a petition cannot be a substitute for a lost appeal.
Issues: WON the CA erred in rejecting the petition for certiorari under Rule 65 of the Rules of Court filed by
petitioner to assail the Decision of the Voluntary Arbitrator.

Ruling: The general rule is that the proper remedy from decisions of voluntary arbitrators is a petition for review
under Rule 43 of the Rules of Court. This ruling has been repeatedly reiterated in subsequent cases and continues
to be the controlling doctrine.

Nonetheless, a special civil action for certiorari under Rule 65 of the Rules of Court is the proper remedy for one
who complains that the tribunal, board or officer exercising judicial or quasi-judicial functions acted in total
disregard of evidence material to or decisive of the controversy.

The Voluntary Arbitrator gravely abused its discretion in giving a strict or literal interpretation of the CBA provisions
that the holiday pay be reflected in the payroll slips. Such literal interpretation ignores the admission of respondent
in its Position Paper that the employees were paid all the days of the month even if not worked. In light of such
admission, petitioner's submission of its 360 divisor in the computation of employees' salaries gains significance.

In this case, the employees are required to work only from Monday to Friday. Thus, the minimum allowable divisor
is 263, which is arrived at by deducting 51 unworked Sundays and 51 unworked Saturdays from 365 days. Considering
that petitioner used the 360-day divisor, which is clearly above the minimum, indubitably, petitioners employees
are being given their holiday pay.

Thus, the Voluntary Arbitrator should not have simply brushed aside petitioner's divisor formula. In granting
respondent's claim of non-payment of holiday pay, a "double burden" was imposed upon petitioner because it was
being made to pay twice for its employees' holiday pay when payment thereof had already been included in the
computation of their monthly salaries. Moreover, it is absurd to grant respondent's claim of non-payment when they
in fact admitted that they were being paid all of the days of the month even if not worked. By granting respondent's
claim, the Voluntary Arbitrator sanctioned unjust enrichment in favor of the respondent and caused unjust financial
burden to the petitioner. Obviously, the Court cannot allow this.

Pearanda v. Baganga Plywood Corp. (BPC)

Managerial employees and members of the managerial staff are exempted from the provisions of the Labor Code
on labor standards. Since petitioner belongs to this class of employees, he is not entitled to overtime pay and
premium pay for working on rest days.

Facts: Sometime in June 1999, petitioner Charlito Pearanda (Foreman/Bouler Head/Shift Engineer) was hired as an
employee of BPC to take charge of the operations and maintenance of its steam plant boiler. In May 2001, Pearanda
filed a Complaint for illegal dismissal with money claims against BPC and its general manager, Hudson Chua, before
NLRC. After the parties failed to settle amicably, the labor arbiter directed the parties to file their opposition papers
and submit supporting documents.

Contention of Pearanda: Alleged that his services were terminated without the benefit of due process and valid
grounds in accordance with law. Furthermore, he was not paid his overtime pay, premium pay for working during
holidays/rest days, night shift differentials and finally claimed for payment of damages and attorneys fees having
been forced to litigate the present complaint.

Contention of BPC: Complainants separation from service was done pursuant to Art. 283 of the Labor Code. BPC
was on temporary closure due to repair and general maintenance and it applied for clearend with DOLE-RO XI to
shut down and to dismiss employees. Due to the insistence of complainant, he was paid his separation benefits.
However, when BPC partially reopened, complainant failed to reapply. Hence, he was, not terminated from
employment much less illegally. He opted to sever employment when he insisted payment of his separation benefits.
Furthermore, being a managerial employee he is not entitled to overtime pay and if ever he rendered services
beyond the normal hours of work, there was no office order/or authorization for him to do so.

Labor Arbiter: There was no illegal dismissal and that complaint was premature because he was still employed by
BPC. Temporary closure of BPC did not terminate his employment, hence he need not reapply when BPC reopened.

NLRC: Deleted the award of overtime pay and premium pay for working on rest days, saying that petitioner was not
entitled to these awards because he was a managerial employee

CA: Denied reconsideration on the ground that petitioner still failed to submit the pleadings filed before the NLRC

Issue: 1) WON Penaranda is a regular, common, employee entitled to monetary benefits under Art. 82; 2) WON
Penaranda is entitled to the payment of Overtime Pay and Other Monetary Benefits

Ruling: Petition is not meritorious.

1. Managerial employees are those whose primary duty consists of the management of the establishment in which
they are employed or of a department or subdivision (Art. 82).
The IRR of the Labor Code states that managerial employees are those who meet the following conditions:

a. their primary duty consists of the management of the establishment in which they are employed or of a
department or subdivision thereof;
b. they customarily and regularly direct the work of two or more employees therein;
c. they have the authority to hire or Dre other employees of lower rank; or their suggestions and
recommendations as to the hiring and firing and as to the promotion or any other change of status of other
employees are given particular weight

In line with this, petitioner was a managerial employee. However, he was a member of the managerial staff, which
also takes him out of the coverage of labor standards. Managerial staff members are not entitled to the provisions
in on the law on labor standards. A managerial staff has the following duties and responsibilities:

(1) The primary duty consists of the performance of work directly related to management policies of the employer;

(2) Customarily and regularly exercise discretion and independent judgment;

(3) (a) Regularly and directly assist a proprietor or a managerial employee whose primary duty consists of the
management of the establishment in which he is employed or subdivision thereof; or (b) execute under general
supervision work along specialized or technical lines requiring special training, experience, or knowledge; or (c)
execute under general supervision special assignments and tasks; and

(4) who do not devote more than 20 percent of their hours worked in a workweek to activities which are not directly
and closely related to the performance of the work described in paragraphs (1), (2), and (3) above."

1. To supply the required and continuous steam to all consuming units at minimum cost.
2. To supervise, check and monitor manpower workmanship as well as operation of boiler and accessories.
3. To evaluate performance of machinery and manpower.
4. To follow-up supply of waste and other materials for fuel.
5. To train new employees for effective and safety white working.
6. Recommend parts and suppliers purchases.
7. To recommend personnel actions such as: promotion, or disciplinary action.
8. To check water from the boiler, feedwater and softener, regenerate softener if beyond hardness limit.
9. Implement Chemical Dosing.
10. Perform other task as required by the superior from time to time.

2. On the basis of the foregoing, the Court finds no justification to award overtime pay and premium pay for rest
days to petitioner.

San Miguel Corp. v. Del Rosario

Facts: Respondent was employed by petitioners as key account specialist. Petitioner informed
respondent that her probationary employment will be severed at the close of the business hours of
March 12, 2001. On March 13,2001, respondent was refused entry to petitioners premises.

Respondent: Filed a complaint against petitioner for illegal dismissal and underpayment/non-payment
of monetary benefits. Respondent alleged that petitioner feigned an excess in manpower because after
her dismissal, it hired new recruits, namely, Jerome Sanchez and Marilou Marfil and re-employed two of
her batch mates, Rosendo To and Ruel Rocha.
Petitioner: Claimed that respondent was a probationary employee whose services were terminated as a
result of the excess manpower that could no longer be accommodated by the company.

Labor Arbiter: Declared respondent a regular employee because her employer exceeded 6 months and
holding that she was illegally dismissed as there was no authorize cause to terminate her employment.

NLRC: Modified the decision of LA, holding that respondent is a regular employee whose termination
from employment was valid but ineffectual for petitioners failure to comply with the 30-day notice to
the employee and DOLE.

CA: Reinstated the decision of LA, finding her to be an illegally dismissed regular employee, but deleted
the award for holiday pay for lack of basis.

Issues: 1) WON respondent is a regular employee of petitioner; 2) WON respondent was illegally
dismissed; 3) If so, WON is entitled to any monetary benefit

Ruling:

1. Respondent is a regular employee.

The burden of proving the circumstances that would justify the employees dismissal rests with the
employer. The best proof that petitioner should have presented to prove the probationary status of
respondent is her employment contract. Having none, the continuous employment of respondent as an
account specialist for almost 11 months means that she was a regular employee and not a temporary
reliever or a probationary employee.

2. Respondent was illegally dismissed.

Having ruled that respondent is a regular employee, her termination from employment must be for a
just or authorized cause, otherwise, her dismissal would be illegal. Redundancy, for purposes of the
Labor Code, exists where the services of an employee are in excess of what is reasonably demanded by
the actual requirements of the enterprise. In the case at bar, petitioner presented an affidavit of its
Sales Manager and a memorandum of the company both to the effect that there is a need to redeploy
its regular employees and terminate the employment of temporary employees, in view of an excess in
manpower. These documents, however, do not satisfy the requirement of substantial evidence that a
reasonable mind might accept as adequate to support a conclusion.

3. Respondent entitled not only to reinstatement but also to backwages.

Considering that respondent was illegally dismissed, she is entitled not only to reinstatement but also to
payment of full backwages, computed from the time her compensation was actually withheld up to her
actual reinstatement. As a regular employee, she is likewise entitled to other benefits, such as service
incentive leave pay and 13th month pay computed from such date up to her actual reinstatement. She is
however not entitled to holiday pay because records reveal that she is a monthly paid regular employee.
Under Section 2, Rule IV, Book III of the Omnibus Rules Implementing the Labor Code, employees who
are uniformly paid by the month, irrespective of the number of working days therein, shall be presumed
to be paid for all the days in the month whether worked or not.