[2015V103] Veritas Maritime and/or Erickson Marquez vs Ramon Gepanaga

[2015V103] VERITAS MARITIME CORPORATION AND/OR ERICKSON MARQUEZ, PETITIONERS, VS. RAMON A. GEPANAGA, JR., RESPONDENT.

G.R. No. 206285, 2nd Division, 2015 Feb 4

Labor > Labor Standards > Benefits

D E C I S I O N

MENDOZA, J.:

Before this Court is a petition for review on certiorari[1] assailing the September 17, 2012 Decision[2] and the March 14, 2013 Resolution[3] of the Court of Appeals (CA), in CA-G.R. SP No. 115186, which stemmed from a claim for permanent disability benefits, sickness allowance, damages, and attorney's fees, filed by respondent Ramon A. Gepanaga, Jr. (Gepanaga) against petitioner Veritas Maritime Corporation (Veritas), and its president, petitioner Erickson Marquez (Marquez), before the National Labor Relations Commission (NLRC).

In the August 27, 2009 Decision[4] of Labor Arbiter Fe S. Cellan (LA), the complaint filed by Gepanaga was dismissed for lack merit. On appeal, the NLRC reversed the ruling of the LA and declared Gepanaga to be suffering from permanent total disability. The NLRC, thus, ordered Veritas and Marquez to compensate him in the amount of $89,100.00 or its Philippine Peso equivalent.[5] After their motion for reconsideration was denied by the NLRC in its June 28, 2010 Resolution,[6] Veritas and Marquez filed a petition for certiorari[7] with the CA.

The CA, while affirming the findings and conclusions of the NLRC, modified its disposition and made the obligation to pay disability benefits to Gepanaga the sole responsibility of Veritas.[8] Veritas attempted to seek reconsideration but its effort was rebuffed.[9]

Hence, this petition.

The Facts:

It appears that on March 11, 2008, Gepanaga entered into a contract of employment with Veritas, for and in behalf of St. Paul Maritime Corporation, to work on board the vessel M.V. Melbourne Highway as Wiper Maintenance for six (6) months.[10] By executing the contract of employment, the parties agreed to be bound by the provisions of Philippine Overseas Employment Administration Standard Employment Contract (POEA-SEC), as well as the IBF-JSU AMOSUP IMMAJ collective bargaining agreement (CBA).[11]

As Gepanaga was able to complete his contract with no incident, the parties mutually agreed to extend his tenure as Wiper Maintenance. What happened shortly thereafter was what sparked the current controversy.

On November 28, 2008, while Gepanaga was doing maintenance work, his middle finger got caught between the cast metal piston liners of the diesel generator. He was then given first aid on board the vessel and was later brought to a hospital in Omaezaki, Japan. In the hospital, Gepanaga was diagnosed with "open fracture of [the] distal phalanx, left middle finger."[12] He was repatriated on December 3, 2008.

On December 4, 2008, Gepanaga reported right away to the clinic of Dr. Nicomedez G. Cruz (Dr. Cruz), the company-designated physician. After Gepanaga was referred to the orthopedic surgeon of his clinic, Dr. Cruz concurred in the initial findings of doctors in Japan that Gepanaga was suffering from a "[c]rushing injuring with fracture distal phalanx left middle finger."[13] After a series of medical treatments, Dr. Cruz noted that Gepanaga no longer suffered the pain in the affected area and that his "grip is good and functional." Dr. Cruz thus issued his medical report, dated March 4, 2009, declaring that Gepanaga was "cleared fit to go back to work."[14]

Unconvinced that he had fully recovered from his injury, Gepanaga filed a complaint[15] against Veritas, Marquez and "K" Line Ship Management, Inc., claiming that the latter is the foreign principal of Veritas and owner of the M.V. Melbourne Highway.[16]

Several days after filing his complaint, Gepanaga sought the opinion of Dr. Edmundo A. Villa (Dr. Villa) of the Sogod District Hospital in Leyte. That same day, Dr. Villa gave his medical report finding that Gepanaga suffered from "permanent disability due to old compound fracture of the 3rd left phalanx/middle finger-left."[17] Thus, when Gepanaga filed his position paper,[18] he included Dr. Villa's report to support his contention that the injuries he had sustained while on board the M.V. Melbourne rendered him permanently unfit to work.

Ruling of the Labor Arbiter

On August 27, 2009, the LA dismissed the complaint for lack of merit. Finding the evaluation of the company-designated physician, Dr. Cruz, more credible than the findings of Dr. Villa, the LA opined that because he was the one who attended to Gepanaga from his repatriation until he was declared fit to work, Dr. Cruz was in the best position to make the evaluation of Gepanaga's true state of health. Moreover, the LA denied the claim for sick wages allowance after it found that as early as March 4, 2009, Gepanaga was already cleared to return to work. For lack of substantial evidence, the LA also denied Gepanaga's claims for reimbursement of his medical expenses, for damages and attorney's fees.

Ruling of the NLRC

As stated above, in its February 10, 2010 Decision, the NLRC found merit in Gepanaga's claim and reversed the decision of the LA. It opined that the assessment of the company-designated physician should not be binding in determining the true condition of Gepanaga, considering that he was chosen, engaged and remunerated by Veritas and, as such, was likely to advance and serve its interests. Dr. Villa, on the other hand, was a government physician, and the NLRC gave credence to his medical assessment of Gepanaga's condition.

The NLRC also noted that the allegation that Gepanaga was covered by the CBA was never refuted, and, thus, awarded him $89,100.00 in accordance with its provisions.

Both parties sought reconsideration. The NLRC denied the motion of Veritas but granted Gepanaga's claim for attorney's fees.

Ruling of the Court of Appeals

In finding no grave abuse of discretion on the part of the NLRC, the CA held that Gepanaga indeed suffered from permanent disability as he was unable to perform his customary work as seaman for more than 120 days. According to the CA, although the Certification from Dr. Cruz was issued 91 days after his repatriation on December 3, 2008, there was no categorical evidence to show that he was able to resume his job after the crushing injury which resulted in the fracture of the distal phalanx left middle finger.

The CA agreed with the NLRC that the terms of the CBA should govern in determining the liabilities of the parties. Citing Article 27 of the CBA, the CA opined that the CBA did not prohibit a second medical opinion, and it even allowed the nomination of a third physician in case of disagreement between the assessment of the company-designated physician and the personal physician of the seafarer. Finding that Veritas failed to avail of a third doctor, the CA ruled that the NLRC did not err in construing that it is not only the findings of the company-designated physician that should control in determining the fitness and/or degree of disability of Gepanaga.

As the NLRC did, the CA concluded that Gepanaga suffered from permanent total disability as a result of his injuries. It was undisputed that because of the injury he sustained, Gepanaga lost the gripping power of his left hand and he was unable to return to his usual work as a seaman for a period of more than 120 days. The CA noted that despite the treatment and assessment of the company-designated physician, the injury sustained did not show any appreciable improvement as diagnosed by an independent physician; and that the independent assessment of Dr. Villa showed that the treatment he received failed to restore the ability of the injured finger to its normal function. With such handicap, the CA found that it would not be possible for Gepanaga to perform his work as a seaman.

The CA, however, pointed out that the NLRC failed to disclose the basis for the personal liability of Marquez. In its evaluation, the CA found that there was no categorical evidence to show that Marquez acted maliciously or in bad faith and, therefore, should not be made personally liable for the payment of the disability benefits.

Veritas and Marquez sought reconsideration but to no avail.

Hence, this petition.

In their petition, petitioners insist that Gepanaga is not entitled to permanent disability benefits, since he was declared "fit to work" by the company after receiving treatment from the day he was repatriated on December 3, 2008 to March 4, 2009 for a total of 91 days. Citing the Court's ruling in Vergara v. Hammonia Maritime Services, Inc.[19] (Vergara), the petitioners argue that Gepanaga's alleged inability to work after the lapse of 120 days from the time he suffered his injury does not automatically entitle him to the grant of permanent and total disability benefits.[20]

The petitioners also insist that they are not liable to pay attorney's fees since their denial of Gepanaga's claims was done in good faith and based on valid grounds. They point to the fact that almost immediately upon the repatriation of the respondent, they referred him to the company-designated physician for examination and treatment. They add that they also shouldered Gepanaga's medical expenses without raising any issue.[21]

Position of the Respondent

Maintaining the correctness of the decision of the CA, Gepanaga asserts that he was entitled to claim for permanent total disability benefits because his personal physician established that he was not fit to work. He claims that the award of attorney's fees was warranted as he was compelled to litigate to enforce his claims.

The Court's Ruling

The evidentiary records favor the petitioners.

In order to provide a clear-cut set of rules in resolving the ubiquitous conflict between the seafarer and his employer for claims of permanent disability benefits, the Court in Vergara, stated that the Department of Labor and Employment (DOLE), through the POEA, had simplified the determination of liability for work-related death, illness or injury in the case of Filipino seamen working in foreign ocean-going vessels. Every seaman and vessel owner (directly or represented by a local manning agency) are required to execute the POEA-SEC as a condition sine qua non prior to the deployment of the seaman for overseas work. The POEA-SEC is supplemented by the CBA between the owner of the vessel and the covered seaman.

In this case, the parties entered into a contract of employment in accordance with the POEA-SEC. They also agreed to be bound by the CBA. Thus, in resolving whether Gepanaga is entitled to disability compensation, the Court will be guided by the procedures laid down in the POEA-SEC and the CBA.

Section 20(B)(3) of the POEA-SEC provides:

Upon sign-off from the vessel for medical treatment, the seafarer is entitled to sickness allowance equivalent to his basic wage until he is declared fit to work or the degree of permanent disability has been assessed by the company-designated physician but in no case shall this period exceed one hundred twenty (120) days.

For this purpose, the seafarer shall submit himself to a postemployment medical examination by a company-designated physician within three working days upon his return except when he is physically incapacitated to so, in which case, a written notice to the agency within the same period is deemed a compliance. Failure of the seafarer to comply with the mandatory reporting requirement shall result in his forfeiture of the right to claim the above benefits.

If a doctor appointed by the seafarer disagrees with the assessment, a third doctor may be agreed jointly between the Employer and the seafarer. The third doctor's decision shall be final and binding on both parties.

[Emphasis supplied]

The CBA between the petitioners and the respondent states that:

20.1.3.2 The degree of disability which the employer, subject to this Agreement, is liable to pay shall be determined by a doctor appointed by the Employer. If a doctor appointed by the seafarer and his Union disagrees with the assessment, a third doctor may be agreed jointly between the Employer and the Seafarer and his Union, and the third doctor's decision shall be final and binding on both parties. The copy/ies of the medical certificate and other relevant medical reports shall be made available by the Company to the seafarer.

[Emphasis supplied]

Interpreting an almost identical provision of the CBA, the Court ruled, in the recent case of Philippine Hammonia Ship Agency, Inc. v. Dumadag[22] (Dumadag), that a seafarer's non-compliance with the mandated procedure under the POEA-SEC and the CBA militates against his claims. In Dumadag, the Court explained:

The POEA-SEC and the CBA govern the employment relationship between Dumadag and the petitioners. The two instruments are the law between them. They are bound by their terms and conditions, particularly in relation to this case, the mechanism prescribed to determine liability for a disability benefits claim. In Magsaysay Maritime Corp. v. Velasquez, the Court said: "The POEA Contract, of which the parties are both signatories, is the law between them and as such, its provisions bind both of them." Dumadag, however, pursued his claim without observing the laid-out procedure. He consulted physicians of his choice regarding his disability after Dr. Dacanay, the company-designated physician, issued the fit-to-work certification for him. There is nothing inherently wrong with the consultations as the POEA-SEC and the CBA allow him to seek a second opinion. The problem only arose when he pre-empted the mandated procedure by filing a complaint for permanent disability compensation on the strength of his chosen physician's opinions, without referring the conflicting opinions to a third doctor for final determination.

x x x x

The filing of the complaint constituted a breach of Dumadag's contractual obligation to have the conflicting assessments of his disability referred to a third doctor for a binding opinion. The petitioners could not have possibly caused the non-referral to a third doctor because they were not aware that Dumadag secured separate independent opinions regarding his disability. Thus, the complaint should have been dismissed, for without a binding third opinion, the fit-to-work certification of the company-designated physician stands, pursuant to the POEA-SEC and the CBA. As it turned out, however, the LA and the NLRC relied on the assessments of Dumadag's physicians that he was unfit for sea duty, and awarded him permanent total disability benefits.

We find the rulings of the labor authorities seriously flawed as they were rendered in total disregard of the law between the parties - the POEA-SEC and the CBA - on the prescribed procedure for the determination of disability compensation claims, particularly with respect to the resolution of conflicting disability assessments of the company-designated physician and Dumadag's physicians, without saying why it was disregarded or ignored; it was as if the POEA-SEC and the CBA did not exist. This is grave abuse of discretion, considering that, as labor dispute adjudicators, the LA and the NLRC are expected to uphold the law. For affirming the labor tribunals, the CA committed the same jurisdictional error.

As we earlier stressed, Dumadag failed to comply with the requirement under the POEA-SEC and the CBA to have the conflicting assessments of his disability determined by a third doctor as was his duty. He offered no reason that could have prevented him from following the procedure. Before he filed his complaint, or between July 19, 2007, when he came home upon completion of his contract, and November 6, 2007, when Dr. Dacanay declared him fit to work, he had been under examination and treatment (with the necessary medical procedures) by the company specialists. All the while, the petitioners shouldered his medical expenses, professional fees and costs of his therapy sessions. In short, the petitioners attended to his health condition despite the expiration of his contract. We, therefore, find it puzzling why Dumadag did not bring to the petitioners' attention the contrary opinions of his doctors and suggest that they seek a third opinion.

Whatever his reasons might have been, Dumadag's disregard of the conflict-resolution procedure under the POEA-SEC and the CBA cannot and should not be tolerated and allowed to stand, lest it encourage a similar defiance. We stress in this respect that we have yet to come across a case where the parties referred conflicting assessments of a seafarer's disability to a third doctor since the procedure was introduced by the POEA-SEC in 2000 - whether the Court's ruling in a particular case upheld the assessment of the company-designated physician, as in Magsaysay Maritime Corporation v. National Labor Relations Commission (Second Division) and similar other cases, or sustained the opinion of the seafarer's chosen physician as in HFS Philippines, Inc. v. Pilar, cited by the CA, and other cases similarly resolved. The third-doctor-referral provision of the POEA-SEC, it appears to us, has been honored more in the breach than in the compliance. This is unfortunate considering that the provision is intended to settle disability claims voluntarily at the parties' level where the claims can be resolved more speedily than if they were brought to court.

Given the circumstances under which Dumadag pursued his claim, especially the fact that he caused the non-referral to a third doctor, Dr. Dacanay's fit-to-work certification must be upheld. In Santiago v. Pacbasin Ship Management, Inc., the Court declared: "[t]here was no agreement on a third doctor who shall examine him anew and whose finding shall be final and binding. x x x [T]his Court is left without choice but to uphold the certification made by Dr. Lim with respect to Santiago's disability."

On a different plane, Dumadag cannot insist that the "favorable" reports of his physicians be chosen over the certification of the company-designated physician, especially if we were to consider that the physicians he consulted examined him for only a day (or shorter) on four different dates between December 5, 2007 and April 13, 2008. Moreover, we point out that they merely relied on the same medical history, diagnoses and analyses provided by the company-designated specialists. Under the circumstances, we cannot simply say that their findings are more reliable than the conclusions of the company-designated physicians. [23]

[Emphases and underscoring supplied]

As in Dumadag, Gepanaga failed to observe the prescribed procedure of having the conflicting assessments on his disability referred to a third doctor for a binding opinion. Consequently, the Court applies the following pronouncements laid down in Vergara:

The POEA Standard Employment Contract and the CBA clearly provide that when a seafarer sustains a work-related illness or injury while on board the vessel, his fitness or unfitness for work shall be determined by the company-designated physician. If the physician appointed by the seafarer disagrees with the company-designated physician's assessment, the opinion of a third doctor may be agreed jointly between the employer and the seafarer to be the decision final and binding on them.

Thus, while petitioner had the right to seek a second and even a third opinion, the final determination of whose decision must prevail must be done in accordance with an agreed procedure. Unfortunately, the petitioner did not avail of this procedure; hence, we have no option but to declare that the company-designated doctor's certification is the final determination that must prevail. [24] x x x.

[Emphases supplied]

Indeed, for failure of Gepanaga to observe the procedures laid down in the POEA-SEC and the CBA, the Court is left without a choice but to uphold the certification issued by the company-designated physician that the respondent was "fit to go back to work."

Petitioner's Claim for Benefits Was Premature

Actually, Gepanaga's filing of his claim was premature. The Court has held that a seafarer may have basis to pursue an action for total and permanent disability benefits, if any of the following conditions is present:

(a) The company-designated physician failed to issue a declaration as to his fitness to engage in sea duty or disability even after the lapse of the 120-day period and there is no indication that further medical treatment would address his temporary total disability, hence, justify an extension of the period to 240 days;

(b) 240 days had lapsed without any certification issued by the company designated physician;

(c) The company-designated physician declared that he is fit for sea duty within the 120-day or 240-day period, as the case may be, but his physician of choice and the doctor chosen under Section 20-B(3) of the POEA-SEC are of a contrary opinion;

(d) The company-designated physician acknowledged that he is partially permanently disabled but other doctors who he consulted, on his own and jointly with his employer, believed that his disability is not only permanent but total as well;

(e) The company-designated physician recognized that he is totally and permanently disabled but there is a dispute on the disability grading;

(f) The company-designated physician determined that his medical condition is not compensable or work-related under the POEA-SEC but his doctor-of-choice and the third doctor selected under Section 20-B(3) of the POEA-SEC found otherwise and declared him unfit to work;

(g) The company-designated physician declared him totally and permanently disabled but the employer refuses to pay him the corresponding benefits; and

(h) The company-designated physician declared him partially and permanently disabled within the 120-day or 240-day period but he remains incapacitated to perform his usual sea duties after the lapse of said periods.[25]

In this case, when Gepanaga filed his complaint with the arbitration office on March 25, 2009, he had yet to consult his own physician, Dr. Villa. Indeed, the Court has observed that when Gepanaga filed his complaint, he was armed only with the belief that he had yet to fully recover from his injured finger because of the incident that occurred on board the M.V. Melbourne Highway. It was only on June 9, 2009, a few days before he filed his position paper on June 15, 2009, that Gepanaga sought the services of Dr. Villa.

It bears pointing out that even worse than the case in Dumadag, Gepanaga's personal physician examined him for only one (1) day, that is, on June 9, 2009, two and a half months (2 1/2) after he had filed his claim for permanent disability benefits. Furthermore, the medical certificate issued by Dr. Villa after examining the respondent failed to state the basis of his assessment and conclusion of permanent disability, more than three (3) months after the respondent was declared fit to work by Dr. Cruz, the company-designated physician.

Let it be stressed that the seafarer's inability to resume his work after the lapse of more than 120 days from the time he suffered an injury and/or illness is not a magic wand that automatically warrants the grant of total and permanent disability benefits in his favor.[26] Both law and evidence must be on his side.

For these reasons, and without sufficient evidence to support the respondent's ancillary claims for sick wages, damages and attorney's fees, the same are denied.

WHEREFORE, the petition is GRANTED. The September 17, 2012 Decision and the March 14, 2013 Resolution of the Court of Appeals in CA-G.R. SP No. 115186 are REVERSED and SET ASIDE. The respondent's complaint for permanent disability benefits, sickness allowance, damages and attorney's fees is dismissed for lack of merit.

SO ORDERED.

Carpio, (Chairperson), Velasco, Jr.,* Del Castillo, and Leonen, JJ., concur.

* Designated Acting member in lieu of Associate Justice Arturo D. Brion, per Special Order No. 1910, dated January 12, 2015.

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[1] Rollo, pp. 25-366.

[2] Penned by Associate Justice Eduardo B. Peralta, Jr., with Associate Justices Vicente S.E. Veloso and Jane Aurora C. Lantion concurring; id. at 11-19.

[3] Id. at 21.

[4] Id. at 235-241.

[5] Id. at 102-110.

[6] Id. at 112-114.

[7] Id. at 62-100.

[8] Id. at 11-19.

[9] Id. at 21.

[10] CA rollo, pp. 115-116.

[11] Id. at 116.

[12] Id. at 117.

[13] Id. at 88.

[14] Id. at 94.

[15] Id. at 67-68.

[16] Id. at 95.

[17] Id. at 118.

[18] Id. at 95-121.

[19] Vergara v. Hammonia Maritime Services, Inc., 588 Phil. 895, 908-909 (2008).

[20] Rollo, pp. 30-37.

[21] Id. at 37-39.

[22] G.R. No. 194362, June 26, 2013, 700 SCRA 53.

[23] Id. at 65-68.

[24] Vergara v. Hammonia Maritime Services, Inc., supra note 19, at 914.

[25] C.F. Sharp Crew Management, Inc. v. Taok, G.R. No. 193679, July 18, 2012, 677 SCRA 296, 315.

[26] Millan v. Wallem, G.R. No. 195168, November 12, 2012, 685 SCRA 225, 231.

[2015V69] Flor Dayo vs Status Maritime Corp and/or NAFTO Trade Shipping Commercial

[2015V69] FLOR G. DAYO, PETITIONER, VS. STATUS MARITIME CORPORATION AND/OR NAFTO TRADE SHIPPING COMMERCIAL S.A., RESPONDENTS.

G.R. No. 210660, 2nd Division, 2015 Jan 21

Labor > Labor Standards > Benefits

D E C I S I O N

LEONEN, J.:

This resolves the Petition for Review on Certiorari[1] filed by petitioner Flor G. Dayo, assailing the Decision[2] of the Court of Appeals in CA-G.R. SP No. 118406. The Court of Appeals affirmed the Decision of the National Labor Relations Commission, which reversed the Decision of the Labor Arbiter.[3]

Eduardo P. Dayo (Eduardo) was hired by Status Maritime Corporation for and on behalf of Nafto Trade Shipping Commercial S.A. He was hired as a bosun on board the "MV Naftocement 1" for a period of 10 months, with a monthly salary of US$500.00. Prior to embarkation, he underwent a pre-employment medical examination and was declared fit to work.[4]

Eduardo embarked on June 8, 2008.[5] On September 5, 2008, he "experienced severe pain on his hips and both knees, and total body weakness."[6] He was given medical attention in Bridgetown, Barbados, where he was diagnosed with hypertension.[7] He was repatriated on September 7, 2008.[8]

The next day, Eduardo went to Status Maritime Corporation's office, but he was informed that it was waiting for Nafto Trade Shipping Commercial S.A.'s notification. He was also told that he could seek medical attention and that his expenses would be reimbursed. On September 9, 2008, he went to the Lucena United Doctors Hospital. Dr. Olitoquit, Eduardo's private physician, found the results of his 2D echocardiogram as normal.[9]

Eduardo repeatedly requested for medical assistance, but it was only in November 2008 when he was referred to a company-designated physician. Dr. Bolanos of the Metropolitan Hospital diagnosed him with diabetes mellitus.[10]

Status Maritime Corporation stopped giving Eduardo medical assistance in February 2009. He died on June 11, 2009 due to cardiopulmonary arrest. Flor G. Dayo (Flor), Eduardo's wife, requested for death benefits to no avail. Thus, she filed a complaint.[11]

On the other hand, Status Maritime Corporation alleges that Eduardo was examined by the company-designated physician on September 24, 2008. His medical history showed that he had been suffering from diabetes mellitus and hypertension since the 1990s.[12] He underwent an electromyography and nerve conduction velocity (EMG-NCV) testing, and the results showed that he had diffused "sensimotor polyneuropathy as seen in diabetes mellitus."[13] He was also examined by a neurologist and an orthopedic surgeon.[14] The company-designated physician noted that the illness was pre-existing.[15]

In January 2009, the company-designated physician assessed that Eduardo's polyneuropathy secondary to diabetes mellitus was not work-related.[16]

The Labor Arbiter ruled in favor of Flor and awarded death benefits, burial expenses, and attorney's fees.[17] The dispositive portion of the Decision reads:

WHEREFORE, premises considered, judgment is hereby rendered ordering respondents jointly and severally liable:

1) To pay complainant the amount of US$50,000.00, or its equivalent in Philippine Peso at the prevailing rate of exchange at the time of actual payment, representing the death benefits of the late Eduardo P. Dayo;

2) To pay complainants the amount of US$1,000.00, or its equivalent in Philippine Peso at the prevailing rate at the time of actual payment, representing the burial expenses;

3) To pay complainant the amount equivalent to ten (10%) percent of the total judgment award, as and for attorney's fees;

Other monetary claims are dismissed for lack of merit.

SO ORDERED.[18]

Status Maritime Corporation appealed to the National Labor Relations Commission.[19] In the Decision dated September 30, 2010, the National Labor Relations Commission First Division reversed the Labor Arbiter's Decision and held that:

WHEREFORE, premises considered, the appeal of respondents is GRANTED. Thus, the appealed Decision is hereby REVERSED and SET ASIDE, and another one entered DISMISSING the instant complaint for lack of merit.

SO ORDERED.[20]

Flor filed a Motion for Reconsideration, but it was denied by the National Labor Relations Commission in the Resolution dated December 30, 2010.[21] She then filed a Petition for Certiorari before the Court of Appeals, arguing that her husband died from a work-related illness, thus, it was grave abuse of discretion for the National Labor Relations Commission to reverse the Labor Arbiter's ruling.[22] The Court of Appeals denied the petition, ruling that since Eduardo died after the term of his contract with Status Maritime Corporation, "his beneficiaries are not entitled to the death benefits[.]"[23]

The Court of Appeals cited GSIS v. Valenciano[24] where this court held that "diabetes mellitus is not an occupational disease[.]"[25] The Court of Appeals also cited Section 32-A of the 2000 Philippine Overseas Employment Administration Amended Standard Terms and Conditions that does not list diabetes mellitus as an occupational disease.[26]

Eduardo died after the term of his contract with Status Maritime Corporation. It was clear then that his beneficiaries were not entitled to death benefits.[27] In addition, the Court of Appeals held that Flor failed to substantiate her allegation that Eduardo's illness and cause of death were work-related.[28] A portion of the Court of Appeals Decision states:

Time and again, we have ruled that self-serving and unsubstantiated declarations are insufficient to establish a case before quasi-judicial bodies where the quantum of evidence required to establish a fact is substantial evidence. Often described as more than a mere scintilla, substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion, even if other equally reasonable minds might conceivably opine otherwise. Thus, in the absence of substantial evidence, working conditions cannot be presumed to have increased the risk of contracting the disease.

. . . .

WHEREFORE, the premises considered, the Petition is hereby DENIED. The Decision dated 30 September 2010 of the National Labor Relations Commission (NLRC) and its Resolution dated 30 December 2010 are AFFIRMED in toto.

SO ORDERED.[29] (Citations omitted)

Flor moved for the reconsideration[30] of the Court of Appeals Decision that was denied in the Resolution[31] dated December 12, 2013.

Petitioner filed this Petition for Review on Certiorari, arguing that the Court of Appeals erred in denying her Petition, considering that Eduardo's death was brought about by a work-related illness.[32]

In deciding a Rule 45 Petition for Review on Certiorari of a Court of Appeals Decision in a Rule 65 Petition for Certiorari, this court is limited to determining whether the Court of Appeals was correct in establishing the presence or absence of grave abuse of discretion.[33] Thus, the proper issue in this case is whether the Court of Appeals correctly determined that there was no grave abuse of discretion on the part of the National Labor Relations Commission when it denied petitioner Flor G. Dayo's claim for death benefits.

To support her claim for death benefits, petitioner cites Section 20(A), paragraphs (1) and (4) of the 2000 Philippine Overseas Employment Administration Standard Employment Contract (POEA SEC)[34] which state that:

Section 20. Compensation and Benefits

A. Compensation and Benefits for Death

1. In case of work-related death of the seafarer, during the term of his contract the employer shall pay his beneficiaries the Philippine Currency equivalent to the amount of Fifty Thousand US dollars (US$50,000) and an additional amount of Seven Thousand US dollars (US$7,000) to each child under the age of twenty-one (21) but not exceeding four (4) children, at the exchange rate prevailing during the time of payment.

. . . .

4. The other liabilities of the employer when the seafarer dies as a result of work-related injury or illness during the term of employment are as follows:

a. The employer shall pay the deceased's beneficiary all outstanding obligations due the seafarer under this Contract.

b. The employer shall transport the remains and personal effects of the seafarer to the Philippines at employer's expense except if the death occurred in a port where local government laws or regulations do not permit the transport of such remains. In case death occurs at sea, the disposition of the remains shall be handled or dealt with in accordance with the master's best judgment. In all cases, the employer/master shall communicate with the manning agency to advise for disposition of seafarer's remains.

c. The employer shall pay the beneficiaries of the seafarer the Philippines [sic] currency equivalent to the amount of One Thousand US dollars (US$1,000) for burial expenses at the exchange rate prevailing during the time of payment.

Petitioner also points out that prior to embarkation, Eduardo was given a "fit to work" certification. Yet, he was repatriated due to hypertension. Therefore, his illness was contracted on board the vessel, and his death should be compensated by his employer even though he died after the term of his contract.[35]

On the other hand, respondents argue that the Court of Appeals' ruling was correct since Eduardo died after the term of his contract.[36] His illness, diabetic polyneuropathy secondary to diabetes, is not included in the list of occupational diseases.[37] Petitioner failed to show the causation between Eduardo's work and illness leading up to his death.[38] Petitioner did not even refute the findings of the company-designated physician.[39]

The Court of Appeals found that there was no grave abuse of discretion on the part of the National Labor Relations Commission when it denied the claim for death benefits since Eduardo died after the term of his contract. The Court of Appeals also explained that:

[u]nder the Amended POEA Contract, the important requirement of work-relatedness was incorporated. The incorporation of the work-related provision has made essential causal connection between a seafarer's work and the illness upon which the claim of disability is predicated upon.

. . . .

It should be emphasized that it is petitioner who has the burden of evidence to prove that the illness for which she anchors her present claim for her husband's disability benefits is work-related.[40]

In this case, petitioner does not dispute the fact that her husband died after the term of his contract. Instead, she emphasizes that her husband died due to a work-related illness. Petitioner also argues that:

[she] was not merely faking [her] husband's disability. The Medical Records cannot lie and he was seen by a doctor abroad regarding his illness which eventually [brought] about his death.[41]

Petitioner cites Section 20(A), paragraphs (1) and (4) to support her claim for death benefits. She also cites the second paragraph of Section 20(B) to support her claim for reimbursement of medical and transportation expenses.[42]

The 2000 POEA SEC defines work-related illness as "any sickness resulting to disability or death as a result of an occupational disease listed under Section 32-A of this contract with the conditions set therein satisfied."[43]

The facts of this case indicate that the physician in Barbados diagnosed Eduardo with hypertension.[44] He underwent 2D echocardiogram at the Lucena United Doctors Hospital, and the results were interpreted by Dr. Olitoquit as normal.[45] When Eduardo was examined by the company-designated physician, he admitted that he had been suffering from diabetes mellitus and hypertension since the 1990s.[46] This shows that his illness was pre-existing. His cause of death was cardiopulmonary arrest.[47]

The 2000 POEA SEC recognizes that the list of illnesses under Section 32 is not exhaustive. In Sea Power Shipping Enterprises, Inc. v. Salazar,[48] this court explained that:

[u]nlike Section 20(A), Section 32-A of the POEA Contract considers the possibility of compensation for the death of the seafarer occurring after the termination of the employment contract on account of a work-related illness. But, for death under this provision to be compensable, the claimant must fulfill the following:

1. The seafarer's work must involve the risks describe herein;

2. The disease was contracted as a result of the seafarer's exposure to the described risks;

3. The disease was contracted within a period of exposure and under such other factors necessary to contract it;

4. There was no notorious negligence on the part of the seafarer.[49]

Magsaysay Maritime Services v. Laurel[50] also recognized that the nature of employment can possibly aggravate a pre-existing illness. However, the causation between the nature of employment and the aggravation of the illness must still be proven before compensation may be granted.

Settled is the rule that for illness to be compensable, it is not necessary that the nature of the employment be the sole and only reason for the illness suffered by the seafarer. It is sufficient that there is a reasonable linkage between the disease suffered by the employee and his work to lead a rational mind to conclude that his work may have contributed to the establishment or, at the very least, aggravation of any pre-existing condition he might have had.[51] (Citation omitted)

Petitioner was unable to fulfill these requirements. She did not allege how the nature of Eduardo's work as a bosun[52] contributed to the development or the aggravation of his illness. Further, he himself admitted that he had diabetes and hypertension prior to his embarkation. Considering that diabetes mellitus is not listed as an occupational disease under the 2000 POEA SEC and considering that petitioner did not prove how Eduardo's occupation contributed to the development of his illness, no error can be attributed to the Court of Appeals when it affirmed the National Labor Relations Commission's Decision and Resolution.

Petitioner further argues that respondents should not be absolved from any liability simply because Eduardo died after the term of his contract.[53]

Indeed, it is quite possible that a work-related illness may progress at a slow pace such that a seafarer's death will happen beyond the term of the employment contract. In such cases, the provisions of the POEA SEC should not limit the rights of seafarers to be compensated.

The concurring opinion in Interorient Maritime Enterprises, Inc. v. Creer III[54] discussed that:

[t]he Philippine Overseas Employment Administration or POEA regulations require certain provisions to be put in the employment contract. Necessarily, it prescribes a procedure that finds a balance of interest in both the amount and the process for recovery of compensation as a result of occupational hazards suffered by the seafarer. The cause of action in such recovery is based on contract inclusive of both statutory and regulatory provisions impliedly included in it.

While this may be the theory pursued in practice, substantive law still allows recovery of damages for injuries suffered by the seafarer as a result of a tortious violation on the part of the employer. This may be on the basis of the provisions of the Civil Code as well as special laws. These special laws may relate, among others, to environmental regulations and requirements to ensure the reduction of risks to occupational hazards both for the seafarer and the public in general. In such cases, the process for recovery should not be constrained by contract.[55]

However, petitioner did not allege facts that would sway this court to grant the Petition. She did not present evidence to show how Eduardo's diabetes mellitus was aggravated by his work and how his illness caused his death. On the contrary, petitioner's allegations further convinced this court that the Court of Appeals did not err in its Decision. A portion of the Petition for Review reads:

12.3 In the case at bar, it bears to stress that Mr. Dayo was certified as "fit to work" based on a pre-employment medical examination. He was deployed on 8 June 2008 and was repatriated on 7 September 2008 due to HYPERTENSION. Upon his arrival in the Philippines, respondents refused to provide Mr. Dayo medical assistance. But due to his critical condition, Mr. Dayo went to Lucena United Doctors Hospital for medical evaluations. He was advi[sed] to undergo [a] series of medical and laboratory tests. Thereafter, Dr. Olitoquit, Mr. Dayo's attending physician, came up with a conclusion that: "NORMAL LEFT VENT[R]ICULAR DIMENSION WITH ADEQUATE WALL MOTION AND CONTRACTILITY; NORMAL LEFT AND RIGHT ATRIA, RIGHT VENTRICLE, MAIN PULMONARY ARTERY AND AORTIC ROOT DIMENSION'S [sic]. STRUCTURALLY NORMAL TRICUSPID, PULMONIC, MITRAL AND AORTIC VALVE. CONCLUSION: NORMAL 2D ECHO-CARDIOGRAM STUDY."[56]

From petitioner's allegations, it is clear that Eduardo's physician found him to have a "normal 2D echocardiogram study."[57] This disproves petitioner's allegation that Eduardo's illness and death were work-related.

Regarding Eduardo's "fit to work" certification, this court has previously ruled that the pre-employment medical examination (PEME) is not exploratory and while:

[t]he PEME merely determines whether one is "fit to work" at sea or "fit for sea service," it does not state the real state of health of an applicant. In short, the "fit to work" declaration in the respondent's PEME cannot be a conclusive proof to show that he was free from any ailment prior to his deployment. Thus we held in NYK-F[il] Ship Management, Inc. v. NLRC:[58]

While a PEME may reveal enough for the petitioner (vessel) to decide whether a seafarer is fit for overseas employment, it may not be relied upon to inform petitioners of a seafarer's true state of health. The PEME could not have divulged respondent's illness considering that the examinations were not exploratory.[59]

While we commiserate with petitioner, this petition must be denied for failure to show any reversible error on the part of the Court of Appeals. It is true that labor contracts are construed in favor of the employee. However, the facts of this case and the applicable laws show that the grant of death benefits cannot be justified.

WHEREFORE, this court resolves to deny the Petition. The assailed Court of Appeals Decision and Resolution are hereby AFFIRMED.

SO ORDERED.

Carpio, (Chairperson), Velasco, Jr.,* Del Castillo, and Mendoza, JJ., concur.

* Designated acting member per S.O. No. 1910 dated January 12, 2015.

=== go premium with UtakPinoy.Com ===

[1] Rollo, pp. 2-21.

[2] Id. at 25-37. The Decision was penned by Associate Justice Socorro B. Inting and concurred in by Associate Justices Jose C. Reyes, Jr. (Chair) and Mario V. Lopez of the Ninth Division.

[3] Id. at 29-30 and 37.

[4] Id. at 25-26.

[5] Id. at 26.

[6] Id.

[7] Id.

[8] Id.

[9] Id. at 26-27.

[10] Id. at 27.

[11] Id. at 27-28.

[12] Id. at 28.

[13] Id.

[14] Id.

[15] Id. at 28-29.

[16] Id. at 29.

[17] Id.

[18] Id.

[19] Id. at 30.

[20] Id.

[21] Id.

[22] Id. at 32.

[23] Id. at 33.

[24] 521 Phil. 253, 260 (2006) [Per J. Ynares-Santiago, First Division].

[25] Rollo, p. 35.

[26] Id. at 34-35.

[27] Id. at 33.

[28] Id. at 36.

[29] Id. at 36-37.

[30] Id. at 40-45.

[31] Id. at 38-39. The Resolution was penned by Associate Justice Socorro B. Inting and concurred in by Associate Justices Jose C. Reyes, Jr. (Chair) and Mario V. Lopez of the Former Ninth Division.

[32] Id. at 10.

[33] J. Brion, dissenting opinion in Abbott Laboratories, Phils., et al. v. Alcaraz, G.R. No. 192571, April 22, 2014 4-5 [Per J. Perlas-Bernabe, En Banc].

[34] Rollo, p. 10.

[35] Id. at 11-13.

[36] Id. at 60.

[37] Id. at 63.

[38] Id.

[39] Id. at 67.

[40] Id. at 35.

[41] Id. at 14.

[42] Id. at 18.

[43] 2000 POEA Standard Terms and Conditions Governing the Employment of Filipino Seafarers on Board Ocean Going Vessels, Definition of Terms, par. (12). This definition was amended by POEA Memorandum Circular No. 10 (2010).

[44] Rollo, p. 26.

[45] Id. at 27.

[46] Id. at 28.

[47] Id. at 27.

[48] G.R. No. 188595, August 28, 2013, 704 SCRA 233 [Per C.J. Sereno, First Division].

[49] Id. at 246.

[50] G.R. No. 195518, March 20, 2013, 694 SCRA 225 [Per J. Mendoza, Third Division].

[51] Id. at 242.

[52] See Woods Hole Oceanographic Institution, Safety Management Manual, sec. 7.2.1. 3 (visited January 20, 2015). A bosun performs several functions on board a ship such as, but not limited to, keeping the Chief Mate updated on all ship matters, supervising unlicensed personnel "in the sanitation and maintenance of deck department spaces, decks, tools, equipment and associated gear," and giving assistance in training crew members.

[53] Rollo, p. 14.

[54] G.R. No. 181921, September 17, 2014 [Per J. Del Castillo, Second Division].

[55] J. Leonen, concurring opinion in Interorient Maritime Enterprises, Inc. v. Creer III, G.R. No. 181921, September 17, 2014 3 [Per J. Del Castillo, Second Division].

[56] Rollo, p. 14.

[57] Id.

[58] 534 Phil. 725, 739 (2006) [Per J. Carpio Morales, Third Division].

[59] Quizora v. Denholm Crew Management (Philippines), Inc., G.R. No. 185412, November 16, 2011, 660 SCRA 309, 322 [Per J. Mendoza, Third Division], citing Magsaysay Maritime Corporation v. National Labor Relations Commission (Second Division), 630 Phil. 352, 367 (2010) [Per J. Brion, Second Division]. See also The Estate of Posedio Ortega v. Court of Appeals, 576 Phil. 601, 610 (2008) [Per J. Tinga, Second Division] and Status Maritime Corporation v. Spouses Delalamon, G.R. No. 198097, July 30, 2014 11 [Per J. Reyes, First Division].

[2014V647] NUWHRAIN-APL-IUF vs Philippine Plaza Holdings

[2014V647] NATIONAL UNION OF WORKERS IN HOTEL RESTAURANT AND ALLIED INDUSTRIES (NUWHRAIN-APL-IUF), PHILIPPINE PLAZA CHAPTER, PETITIONER, VS. PHILIPPINE PLAZA HOLDINGS, INC., RESPONDENT.

G.R. No. 177524
2014 July 23
2nd Division

Labor > Labor Standards > Service Charge

D E C I S I O N

BRION, J.:

We resolve the petition for review on certiorari,[1] challenging the January 31, 2007 decision[2] and the April 20, 2007 resolution[3] of the Court of Appeals (CA) in CA-G.R. SP No. 93698.

This CA decision reversed the July 4, 2005 decision[4] of the National Labor Relations Commission (NLRC) in NLRC NCR CA No. 031977-02 (NLRC NCR-30-05-02011-01) that in turn, reversed and set aside the April 30, 2002 decision[5] of the Labor Arbiter (LA).

The LA dismissed the complaint for non-payment of service charges filed by petitioner National Union of Workers in Hotel Restaurant and Allied Industries (NUWHRAIN-APL-IUF), Philippine Plaza Chapter (Union).

The Factual Antecedents

The Union is the collective bargaining agent of the rank-and-file employees of respondent Philippine Plaza Holdings, Inc. (PPHI).

On November 24, 1998, the PPHI and the Union executed the "Third Rank-and-File Collective Bargaining Agreement as Amended"[6] (CBA). The CBA provided, among others, for the collection, by the PPHI, of a ten percent (10%) service charge on the sale of food, beverage, transportation, laundry and rooms. The pertinent CBA provisions read:

SECTION 68. COLLECTION. The HOTEL shall continue to collect ten percent (10%) service charge on the sale of food, beverage, transportation, laundry and rooms except on negotiated contracts and special rates. [Emphasis supplied]

SECTION 69. DISTRIBUTION. The service charge to be distributed shall consist of the following:

Effective Food & Beverage Room, Transportation & valet 1998 95% 100% 1997 95% 100%

The distributable amount will be shared equally by all HOTEL employees, including managerial employees but excluding expatriates, with three shares to be given to PPHI Staff and three shares to the UNION (one for the national and two for the local funds) that may be utilized by them for purposes for which the UNION may decide.

These provisions merely reiterated similar provisions found in the PPHI-Union's earlier collective bargaining agreement executed on August 29, 1995.[7]

On February 25, 1999, the Union's Service Charge Committee informed the Union President, through an audit report (1st audit report),[8] of uncollected service charges for the last quarter of 1998 amounting to ?2,952,467.61. Specifically, the audit report referred to the service charges from the following items: (1) "Journal Vouchers;" (2) "Banquet Other Revenue;" and (3) "Staff and Promo." The Union presented this audit report to the PPHI's management during the February 26, 1999 Labor Management Cooperation Meeting (LMCM).[9] The PPHI's management responded that the Hotel Financial Controller would need to verify the audit report.

Through a letter dated June 9, 1999,[10] the PPHI admitted liability for P80,063.88 out of the P2,952,467.61 that the Union claimed as uncollected service charges. The PPHI denied the rest of the Union's claims because: (1) they were exempted from the service charge being revenues from "special promotions" (revenue from the Westin Gold Card sales) or "negotiated contracts" (alleged revenue from the Maxi-Media contract); (2) the revenues did not belong to the PPHI but to third-party suppliers; and (3) no revenue was realized from these transactions as they were actually expenses incurred for the benefit of executives or by way of good-will to clients and government officials.

During the July 12, 1999 LMCM,[11] the Union maintained its position on uncollected service charges so that a deadlock on the issue ensued. The parties agreed to refer the matter to a third party for the solution. They considered two options - voluntary arbitration or court action - and promised to get back to each other on their chosen option.

In its formal reply (to the PPHI's June 9, 1999 letter) dated July 21, 1999 (2nd audit report),[12] the Union modified its claims. It claimed uncollected service charges from: (1) "Journal Vouchers - Westin Gold Revenue and Maxi-Media" (F&B and Rooms Barter); (2) "Banquet and Other Revenue;" and (3) "Staff and Promo."

On August 10, 2000, the Union's Service Charge Committee made another service charge audit report for the years 1997, 1998 and 1999 (3rd audit report).[13] This 3rd audit report reflected total uncollected service charges of P5,566,007.62 from the following entries: (1) "Journal Vouchers;" (2) "Guaranteed No Show;" (3) "Promotions;" and (4) "F & B Revenue." The Union President presented the 3rd audit report to the PPHI on August 29, 2000.

When the parties failed to reach an agreement, the Union, on May 3, 2001, filed before the LA (Regional Arbitration Branch of the NLRC) a complaint[14] for non-payment of specified service charges. The Union additionally charged the PPHI with unfair labor practice (ULP) under Article 248 of the Labor Code, i.e., for violation of their collective bargaining agreement.

In its decision[15] dated April 30, 2002, the LA dismissed the Union's complaint for lack of merit. The LA declared that the Union failed to show, by law, contract and practice, its entitlement to the payment of service charges from the entries specified in its audit reports (specified entries/transactions).

The LA pointed out that Section 68 of the CBA explicitly requires, as a precondition for the distribution of service charges in favor of the covered employees, the collection of the 10% service charge on the "sale of food, beverage, transportation, laundry and rooms;" at the same time, the provision exempts from its coverage "negotiated contracts" and "special rates" that the LA deemed as non-revenue generating transactions involving "food, beverage, transportation, laundry and rooms." The Union failed to prove that the PPHI collected 10% service charges on the specified entries/transactions that could have triggered the PPHI's obligation under this provision.

Particularly, the LA pointed out that, first, the only evidence on record that could have formed the basis of the Union's claim for service charges was the PPHI's admission that, as a matter of policy, it has been charging, collecting and distributing to the covered employees 10% service charge on the fifty percent (50%) of the total selling price of the "Maxi-Media F & B" and on the "Average House" rate of the "Maxi-Media Rooms." And it did so, notwithstanding the fact that the "Maxi-Media F & B and Rooms Barter" is a "negotiated contract" and/or "special rate" that Section 68 explicitly excludes from the service charge coverage.

Second, while the PPHI derived revenues from the sale of the Westin Gold Cards (Westin Gold Revenue), the PPHI did not and could not have collected a 10% service charge as these transactions could not be considered as sale of food, beverage, transportation, laundry and rooms that Section 68 contemplates.

Third, the "Staff and Business Promotion and Banquet" entry refers to the expenses incurred by the PPHI's Marketing Department and Department Heads and Hotel executives either as part of their perks or the PPHI's marketing tool/public relations. These are special rates that are essentially non-revenue generating items.

Fourth, the "Backdrop" entry refers to services undertaken by third parties payment for which were made of course to them; hence, this entry/transaction could not likewise be considered as sale of services by PPHI for which collection of the 10% service charge was warranted.

Lastly, the LA equally brushed aside the Union's claim of ULP declaring that the PPHI was well within its legal and contractual right to refuse payment of service charges for entries from which it did not collect any service charge pursuant to the provision of their CBA.

The NLRC's ruling

In its decision[16] of July 4, 2005, the NLRC reversed the LA's decision and considered the specified entries/transactions as "service chargeable." As the PPHI failed to prove that it paid or remitted the required service charges, the NLRC held the PPHI liable to pay the Union P5,566,007.62 representing the claimed uncollected service charges for the years 1997, 1998 and 1999 per the 3rd audit report.

The PHHI went to the CA on a petition for certiorari[17] after the NLRC denied its motion for reconsideration.[18]

The CA's ruling

The CA granted the PPHI's petition in its January 31, 2007 decision.[19] It affirmed the LA's decision but ordered the PPHI to pay the Union the amount of P80,063.88 as service charges that it found was due under the circumstances. The CA declared that no service charges were due from the specified entries/transactions; either these constituted "negotiated contracts" and "special rates" that Section 68 of the CBA explicitly excludes from the coverage of service charges, or they were cited bases that the Union failed to sufficiently prove.

The CA pointed out that: one, the "Westin Gold Card Revenues" entry involved the sale, not of food, beverage, transportation, laundry and rooms, but of a "contractual right" to be charged a lesser rate for the products and services that the Hotel and the stores within it provide. At any rate, the PPHI charges, collects and distributes to the covered employees the CBA-agreed service charges whenever any Westin Gold Card member purchases food, beverage, etc. Two, the "Maxi-Media F & B and Rooms and Barter" entry did not involve any sale transaction that Section 68 contemplates. The CA pointed out that the arrangement[20] between the PPHI and Maxi-Media International, Inc. was not one of sale but an innominate contract of facio ut des, i.e., in exchange for the professional entertainment services provided by Maxi-Media, the Hotel agreed to give the former P2,800,000.00 worth of products and services. The CA added that this agreement falls under "negotiated contracts" that Section 68 explicitly exempts. Three, the sale of "Gift Certificates" does not involve the CBA-contemplated "sale of food, beverage, etc." Four, the Union failed to show the source of its computations for its "Guaranteed No Show" and "F & B Revenue" claims. Five, the "Business Promotions" entry likewise did not involve any sale; these were part of the PPHI's business expenses in the form of either signing benefits for the PPHI's executives or as marketing tool used by the PPHI's marketing personnel to generate goodwill. And six, the Union's claims for service charges that the PPHI allegedly collected prior to May 3, 1998 or three years before the Union filed its complaint on May 3, 2001 had already prescribed per Article 291 of the Labor Code.

The Union filed the present petition after the CA denied its motion for reconsideration[21] in the CA's April 20, 2007 resolution.[22]

The Petition

The Union argues that the CA clearly misapprehended and misappreciated, with grave abuse of discretion, the facts and evidence on record. It maintains that the specified entries/transactions are revenue based transactions which, per Section 68 and 69 of the CBA, clearly called for the collection and distribution of a 10% service charge in favor of the covered employees.

Particularly, the Union argues that: (1) the "Westin Gold Cards" serve not only as a discount card but also as a "pre-paid" card that provide its purchasing members complimentary amenities for which the Hotel employees rendered services and should, therefore, had been subjected to the 10% service charge; (2) the PPHI failed to prove that it had paid and distributed to the covered employees the service charge due on the actual discounted sales of food, beverage, etc., generated by the "Westin Gold Cards;" (3) the Hotel employees likewise rendered services whenever the Maxi-Media International, Inc. consumed or availed part of the P2,800,000.00 worth of goods and services pursuant to its agreement with the PPHI; (4) the "Maxi-Media" discounts should be charged to the PPHI as part of its expenses and not the Union's share in the service charges; (5) the PPHI has a separate budget for promotions, hence the "Business Promotions" entry should likewise had been subjected to the 10% service charge; (6) the sale of "Gift Certificates," recorded in the PPHI's "Journal Vouchers" as "other revenue/income," constituted a revenue transaction for which service charges were due; (7) the PPHI admitted that service charges from "Guaranteed No Show" were due; and (8) it properly identified through reference numbers the uncollected service charges from "Food and Beverage Revenue." The Union contends that in refusing to collect and remit the CBA-mandated service charges that the PPHI insists were non-revenue transactions falling under "Negotiated Contracts" and/or "Special Rates," the PPHI, in effect, contravened the employees' rights to service charges under the law and the CBA.

The Union also contends that the term "Negotiated Contracts" should be applied to "airline contracts" only that they (the Union and the PPHI) intended when they executed the CBA. It points out that at the time the CBA was executed, the PPHI had an existing agreement with Northwest Airlines to which the term "Negotiated Contracts" clearly referred to.

Further, the Union argues that its claim for unpaid services charges for the year 1997 and part of 1998 had not yet prescribed. Applying Article 1155 of the Civil Code in relation to Article 291 of the Labor Code, the Union points out that the running of the prescriptive period for the filing of its claim was interrupted when it presented to the PPHI its 1st audit report during the February 26, 1999 LMCM and when the PPHI admitted the service charges due to the Union in the PPHI's June 9, 1999 letter.

The Union additionally argues that the PPHI failed to conform to the generally accepted accounting standards when it reclassified the revenue items as expense items.

Finally, the Union contends that the PPHI's refusal, despite repeated demands, to distribute the unremitted service charges and recognize its right to service charges on the specified entries; the PPHI's deliberate failure to disclose its financial transactions and audit reports; and the PPHI's reclassification of the revenues into expense items constitute gross violation of the CBA that amounts to what the law considers as ULP.

The Case for the Respondent

The PPHI primarily counters, in its comment,[23]that the Union's call for the Court to thoroughly re-examine the records violates the Rule 45 proscription against questions of facts. The PPHI points out that Rule 45 of the Rules of Court under which the petition is filed requires that only questions of law be raised. In addition, the factual findings of the LA that had been affirmed by the CA deserve not only respect but even finality.

On the petition's merits, the PPHI argues that the specified entries/transactions for which the Union claims service charges: (1) were not revenue generating transactions; (2) that did not involve a sale of food, beverage, rooms, transportation or laundry; and/or (3) were in the nature of negotiated contracts and special rates that Section 68 of the CBA specifically excepts from the collection of service charges. Correlatively, Article 96 of the Labor Code requires the collection of service charges as a condition precedent to its distribution or payment. Thus, as no service charges were collected on the specified entries/transactions that the CBA expressly excepts, the Union's claim for unpaid service charges clearly had no basis.

To be precise, the PPHI points out that, first, the sale per se of the "Westin Gold Cards" did not involve a sale of food, beverage, etc. that Section 68 of the CBA contemplates. The discounted sales of food, beverage, etc. to Westin Gold Card holders, on the other hand, had already been subjected to service charges inclusive of the discount, i.e., computed on the gross sales of food, beverage, etc. to the card holders, and which service charges it had already distributed to the covered employees. Second, its agreement with Maxi-Media involved an exchange or barter transaction, i.e., its food and Hotel services in exchange for Maxi-Media's entertainment services that did not generate income. This agreement likewise falls under "Negotiated Contracts" that Section 68 clearly excepts. And, in any case, it had already collected, and distributed to the covered employees, the service charges on the food, beverage, etc. that Maxi-Media consumed based on the monthly average rate of the rooms and on the 50% rate of the price of the consumed food and beverage. Third, the Union failed to prove its claims for uncollected service charges from "Guaranteed No Show" and "Business Promotions." Fourth, the "Food and Beverage other Revenue" entry refers to the PPHI's transactions with external service providers the payment for whose services could not be considered as the PPHI's revenue. Fifth, the sale per se of the "Gift Certificates" also did not involve the Section 68-contemplated sale of food, beverage, etc. and the Union failed to prove that the presented Gift Certificates had actually been consumed, i.e., used within the Hotel premises for food, beverage, etc. And sixth, it had never been its practice to collect service charges on the specified entries/transactions that could have otherwise resulted in what the Union considers as "partial abolition of service charges" when it refused to collect service charges from them.

The PPHI also disputes what it considers as the Union's strained interpretation of the CBA exception of "Negotiated Contracts" as applicable to airline contracts only. It points out that the clear wordings of Section 68 of the CBA plainly show the intent to except, in a general and broad sense, "Negotiated Contracts" and "Special Rates" as to include the "Westin Gold Cards" and "Maxi-Media" barter agreement. The PPHI additionally argues that the CBA's exception of "Negotiated Contracts" and "Special Rates" from the collection of service charges does not violate Article 96 of the Labor Code. It points out that Article 96 merely provides for the minimum percentage distribution, between it (the PPHI) as the employer and the Hotel's covered employees, of the collected service charges which their CBA more than satisfied. It also points out that Article 96 does not prohibit the exception of certain transactions from the coverage and/or collection of service charges that it (as the employer) and the Union (in behalf of the covered Hotel employees) had voluntarily and mutually agreed on in their CBA. And in fact, the Union's refusal to recognize these clear and express exceptions constituted a violation of their agreement.

Further, the PPHI maintains that the Union's claim for the alleged uncollected service charges for the year 1997 and the early months of 1998 had already prescribed per Article 291 of the Labor Code.

Finally, the PPHI points out that the issue in this case is not whether service charges had been paid. Rather, the clear issue is whether or not service charges should have been collected (and distributed to the covered employees) for the specified entries/transactions that the LA and the CA correctly addressed and which the NLRC clearly missed as it rendered a decision without any factual or legal basis.

The Court's Ruling

We find the petition unmeritorious.

Preliminary considerations: jurisdictional limitations of the Court's Rule 45 review of the CA's Rule 65 decision in labor cases; the Montoya ruling and factual-issue-bar-rule

In a petition for review on certiorari under Rule 45 of the Rules of Court, we review the legal errors that the CA may have committed in the assailed decision, in contrast with the review for jurisdictional errors that we undertake in an original certiorari action. In reviewing the legal correctness of the CA decision in a labor case taken under Rule 65 of the Rules of Court, we examine the CA decision in the context that it determined the presence or the absence of grave abuse of discretion in the NLRC decision before it and not on the basis of whether the NLRC decision, on the merits of the case, was correct. In other words, we proceed from the premise that the CA undertook a Rule 65 review, not a review on appeal, of the NLRC decision challenged before it. Within this limited scope of our Rule 45 review, the question that we ask is: Did the CA correctly determine whether the NLRC committed grave abuse of discretion in ruling on the case?[24]

In addition, the Court's jurisdiction in a Rule 45 petition for review on certiorari is limited to resolving only questions of law. A question of law arises when the doubt or controversy exists as to what law pertains to a particular set of facts; and a question of fact arises when the doubt or controversy pertains to the truth or falsity of the alleged facts.[25]

The present petition essentially raises the question - whether the Union may collect from the PPHI, under the terms of the CBA, its share of the service charges. This is a clear question of law that falls well within the Court's power in a Rule 45 petition.

Resolution of this question of law, however, is inextricably linked with the largely factual issue of whether the specified entries/transactions fall within the generally covered sale of food, beverage, transportation, etc. from which service charges are due or within the CBA excepted "Negotiated Contracts" and "Special Rates." It also unavoidably requires resolution of another factual issue, i.e., whether the Union's claim for service charges collected for the year 1997 and the early months of 1998 had already prescribed. As questions of fact, they are proscribed by our Rule 45 jurisdiction; we generally cannot address these factual issues except to the extent necessary to determine whether the CA correctly found the NLRC in grave abuse of discretion in granting the Union's claim for service charges from the specified entries/transactions.

The jurisdictional limitations of our Rule 45 review of the CA's Rule 65 decision in labor cases constrain us to deny the present petition for clear lack of legal error in the CA's decision. Our consideration of the facts taken within this limited scope of our factual review power, convinces us that grave abuse of discretion attended the NLRC's decision. At what point and to what extent the NLRC gravely abused its discretion is the matter we shall discuss below.

The NLRC's patently erroneous appreciation of the real issue in the present controversy, along with the facts and the evidence, amounted to grave abuse of discretion

In granting the Union's claim, the NLRC simply declared that the PPHI "has not shown any proof that it paid or remitted what is due to the Union and its members" and concluded that the specified entries/transactions were "service chargeable." This NLRC conclusion plainly failed to appreciate that it involved only the alleged uncollected service charges from the specified entries/transactions. The NLRC likewise, in the course of its ruling, did not point to any evidence supporting its conclusion.

In deciding as it did, the NLRC patently proceeded from the wrong premise, i.e., that the PPHI did not at all distribute to the Hotel's covered employees their share in the collected service charges. It likewise erroneously assumed that all the specified entries/transactions were subject to service charges and that the PPHI collected service charges from them as its ruling was patently silent on this point. The NLRC also erroneously assumed that each and every transaction that the PPHI entered into was subject to a service charge.

What the NLRC clearly and conveniently overlooked was the underlying issue of whether service charges are due from the specified entries/transactions, i.e., whether the specified entries/transactions are covered by the CBA's general-rule provisions on the collection of service charges or whether they are excepted because they fall within the excepted "Negotiated Contracts" and "Special Rates" or simply did not involve a "sale of food, beverage, etc." from which service charges are due. This understanding of this case's real issue is an indispensable requisite in the proper resolution of the controversy and a task that the NLRC, as a tribunal exercising quasi-judicial power, must perform with circumspection and utmost diligence. The patent failure led to its manifestly flawed conclusions that were belied by the underlying facts. By so doing, the NLRC acted outside the clear contemplation of the law.[26]

Accordingly, we affirm the CA's decision to be legally correct as it correctly reversed the NLRC decision for grave abuse of discretion.

Nature of a CBA; rules in the interpretation of CBA provisions

A collective bargaining agreement, as used in Article 252 (now Article 262)[27] of the Labor Code, is a contract executed at the request of either the employer or the employees' exclusive bargaining representative with respect to wages, hours of work and all other terms and conditions of employment, including proposals for adjusting any grievances or questions under such agreement.[28] Jurisprudence settles that a CBA is the law between the contracting parties who are obliged under the law to comply with its provisions.[29]

As a contract and the governing law between the parties, the general rules of statutory construction apply in the interpretation of its provisions. Thus, if the terms of the CBA are plain, clear and leave no doubt on the intention of the contracting parties, the literal meaning of its stipulations, as they appear on the face of the contract, shall prevail.[30] Only when the words used are ambiguous and doubtful or leading to several interpretations of the parties' agreement that a resort to interpretation and construction is called for.[31]

No service charges were due from the specified entries/transactions; they either fall within the CBA-excepted "Negotiated Contracts" and "Special Rates" or did not involve "a sale of food, beverage, etc."

The Union anchors its claim for services charges on Sections 68 and 69 of the CBA, in relation with Article 96 of the Labor Code. Section 68 states that the sale of food, beverage, transportation, laundry and rooms are subject to service charge at the rate of ten percent (10%). Excepted from the coverage of the 10% service charge are the so-called "negotiated contracts" and "special rates."

Following the wordings of Section 68 of the CBA, three requisites must be present for the provisions on service charges to operate: (1) the transaction from which service charge is sought to be collected is a sale; (2) the sale transaction covers food, beverage, transportation, laundry and rooms; and (3) the sale does not result from negotiated contracts and/or at special rates.

In plain terms, all transactions involving a "sale of food, beverage, transportation, laundry and rooms" are generally covered. Excepted from the coverage are, first, non-sale transactions or transactions that do not involve any sale even though they involve "food, beverage, etc." Second, transactions that involve a sale but do not involve "food, beverage, etc." And third, transactions involving "negotiated contracts" and "special rates" i.e., a "sale of food, beverage, etc." resulting from "negotiated contracts" or at "special rates;" non-sale transactions involving "food, beverage, etc." resulting from "negotiated contracts" and/or "special rates;" and sale transactions, but not involving "food, beverage, etc.," resulting from "negotiated contracts" and "special rates."

Notably, the CBA does not specifically define the terms "negotiated contracts" and "special rates." Nonetheless, the CBA likewise does not explicitly limit the use of these terms to specified transactions. With particular reference to "negotiated contracts," the CBA does not confine its application to "airline contracts" as argued by the Union. Thus, as correctly declared by the CA, the term "negotiated contracts" should be read as applying to all types of negotiated contracts and not to "airlines contracts" only. This is in line with the basic rule of construction that when the terms are clear and leave no doubt upon the intention of the contracting parties, the literal meaning of its stipulations shall prevail. A constricted interpretation of this term, i.e., as applicable to "airlines contracts" only, must be positively shown either by the wordings of the CBA or by sufficient evidence of the parties' intention to limit its application. The Union completely failed to provide support for its constricted reading of the term "negotiated contracts," either from the wordings of the CBA or from the evidence.

In reversing the NLRC's ruling and denying the Union's claim, the CA found the specified entries/transactions as either falling under the excepted negotiated contracts and/or special rates or not involving a sale of food, beverage, etc. Specifically, it considered the entries "Westin Gold Cards Revenue" and "Maxi Media Barter" to be negotiated contracts or contracts under special rates, and the entries "Business Promotions" and "Gift Certificates" as contracts that did not involve a sale of food, beverage, etc. The CA also found no factual and evidentiary basis to support the Union's claim for service charges on the entries "Guaranteed No show" and "F & B Revenue."

Our consideration of the records taken under our limited factual review power convinces us that these specified entries/transactions are indeed not subject to a 10% service charge. We thus see no reason to disturb the CA's findings on these points.

The PPHI did not violate Article 96 of the Labor Code when they refused the Union's claim for service charges on the specified entries/transactions

Article 96 of the Labor Code provides for the minimum percentage distribution between the employer and the employees of the collected service charges, and its integration in the covered employees' wages in the event the employer terminates its policy of providing for its collection. It pertinently reads: Art. 96. Service Charges.

x x x In case the service charge is abolished, the share of the covered employees shall be considered integrated in their wages.

This last paragraph of Article 96 of the Labor Code presumes the practice of collecting service charges and the employer's termination of this practice. When this happens, Article 96 requires the employer to incorporate the amount that the employees had been receiving as share of the collected service charges into their wages. In cases where no service charges had previously been collected (as where the employer never had any policy providing for collection of service charges or had never imposed the collection of service charges on certain specified transactions), Article 96 will not operate.

In this case, the CA found that the PPHI had not in fact been collecting services charges on the specified entries/transactions that we pointed out as either falling under "negotiated contracts" and/or "special rates" or did not involve a "sale of food, beverage, etc." Accordingly, Article 96 of the Labor Code finds no application in this case; the PPHI did not abolish or terminate the implementation of any company policy providing for the collection of service charges on specified entries/transactions that could have otherwise rendered it liable to pay an amount representing the covered employees' share in the alleged abolished service charges.

The Union's claim for service charges for the year 1997 and the early months of 1998 could not have yet prescribed at the time it filed its complaint on May 3, 2001; Article 1155 of the Civil Code applies suppletorily to Article 291 of the Labor Code

Article 291 (now Article 305)[32] of the Labor Code states that "all money claims arising from employer-employee relations x x x shall be filed within three (3) years from the time the cause of action accrued; otherwise, they shall forever be barred." [Emphasis supplied]

Like other causes of action, the prescriptive period for money claims under Article 291 of the Labor Code is subject to interruption. And, in the absence of an equivalent Labor Code provision for determining whether Article 291's three-year prescriptive period may be interrupted, Article 1155 of the Civil Code[33] may be applied. Thus, the period of prescription of money claims under Article 291 is interrupted by: (1) the filing of an action; (2) a written extrajudicial demand by the creditor; and (3) a written acknowledgment of the debt by the debtor.

In the present petition, the facts indisputably showed that as early as 1998, the Union demanded, via the 1st audit report, from the PPHI the payment and/or distribution of the alleged uncollected service charges for the year 1997. From thereon, the parties went through negotiations (LCMC) to settle and reconcile on their respective positions and claims.

Under these facts - the Union's written extrajudicial demand through its 1st audit report and the successive negotiation meetings between the Union and the PPHI - the running of the three-year prescriptive period under Article 291 of the Labor Code could have effectively been interrupted. Consequently, the Union's claims for the alleged uncollected service charges for the year 1997 could not have yet prescribed at the time it filed its complaint on May 3, 2001.

This non-barring effect of prescription, notwithstanding (i.e., that the running of the three-year prescriptive period had effectively been interrupted - by the Union's written extrajudicial demand on the PPHI), the CA, as it affirmed the LA, still correctly denied the Union's claims for the alleged uncollected and/or undistributed service charges on the specified entries/transactions for the year 1997 and the early part of 1998. As the CA found and discussed in its decision, and with which we agree as amply supported by factual and legal bases, the nature of these specified entries/transactions as either excepted from the collection of service charges or not constituting a "sale of food, beverage, etc.," and the Union's failure to support its claims by sufficient evidence warranted, without doubt, the denial of the Union's action.

In sum, we find the CA's denial of the Union's claim for service charges from the specified entries/transactions legally correct and to be well supported by the facts and the law. The CA correctly reversed for grave abuse of discretion the NLRC's decision.

WHEREFORE, in light of these considerations, we hereby DENY the petition. We AFFIRM the decision dated January 31, 2007 and resolution dated April 20, 2007 of the Court of Appeals in CA-G.R. Sp No. 93698.

SO ORDERED.

Carpio, (Chairperson), Del Castillo, Perez, and Perlas-Bernabe, JJ., concur.

[1] Rollo, pp. 14-89.

[2] Penned by Associate Justice Vicente Q. Roxas and concurred in by Associate Justices Josefina Guevarra-Salonga and Ramon R. Garcia, id. at 91-106.

[3] Id. at 108.

[4] Penned by Commissioner Angelita A. Gacutan, id. at 525-538.

[5] Penned by Labor Arbiter Renaldo O. Hernandez, id. at 728-749.

[6] Id. at 896-898.

[7] Id. at 898.

[8] Id. at 565.

[9] Id. at 566-567.

[10] Id. at 568-570.

[11] Id. at 549-552.

[12] Id. at 575-576.

[13] Id. at 790.

[14] Id. at 553-554.

[15] Supra note 5.

[16] Supra note 4.

[17] Id. at 473-519.

[18] Rollo, pp. 879-895.

[19] Supra note 2.

[20] Memorandum of Agreement dated June 17, 1998, rollo, pp. 616-624.

[21] Rollo, pp. 109-171.

[22] Supra note 3.

[23] Rollo, pp. 995-1080.

[24] Montoya v. Transmed Manila Corporation, G.R. No. 183329, August 27, 2009, 597 SCRA 334, 342-343.

[25] See Baguio Central University v. Gallente, G.R. No. 188267, December 2, 2013.

[26] Gonzales v. Solid Cement Corporation, G.R. No. 198423, October 23, 2012, 684 SCRA 344. See also Aldovino, Jr. v. Commission on Elections, G.R. No. 184836, December 23, 2009, 609 SCRA 234; and Pecson v. Commission on Elections, G.R. No. 182865, December 24, 2008, 575 SCRA 634.

[27] As directed by Republic Act No. 10151, entitled "An Act Allowing the Employment of Night Workers, thereby Repealing Articles 130 and 131 of Presidential Decree Number Four Hundred Forty-Two, as Amended, Otherwise known as The Labor Code of the Philippines," approved on June 21, 2011, the Labor Code articles beginning with Article 130 are renumbered.

Article 252 (256) of the Labor Code reads: Art. 252. MEANING OF THE DUTY TO BARGAIN COLLECTIVELY

The duty to bargain collectively means the performance of a mutual obligation to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages, hours of work and all other terms and conditions of employment including proposals for adjusting any grievances or questions arising under such agreement and executing a contract incorporating such agreements if requested by either party but such duty does not compel any party to agree to a proposal or to make any concession. [28] Davao Integrated Port Stevedoring Services v. Abarquez, G.R. No. 102132, March 19, 1993, 220 SCRA 197, 204.

[29] Goya, Inc. v. Goya, Inc. Employees Union-FFW, G.R. No. 170054, January 21, 2013, 689 SCRA 1, 15-16, citing TSPIC Corporation v. TSPIC Employees Union (FFW), G.R. No. 163419, February 13, 2008, 545 SCRA 215, 225.

[30] PNCC Skyway Traffic Management and Security Division Workers Organization (PSTMSDWO) v. PNCC Skyway Corporation, G.R. No.171231, February 17, 2010, 613 SCRA 28, 45; Goya, Inc. v. Goya, Inc. Employees Union-FFW, supra, note 29, at 16.

[31] United Kimberly-Clark Employees Union-Philippine Transport General Workers' Organization (UKCEU-PTGWO) v. Kimberly-Clark Philippines, Inc., G.R. No. 162957, March 6, 2006, 519 Phil. 176, 191; Honda Philippines, Inc. v. Samahan ng Malayang Manggagawa sa Honda, G.R. No. 145561, June 15, 2005, 499 Phil. 174, 180.

[32] As directed by Republic Act No. 10151, entitled "An Act Allowing the Employment of Night Workers, thereby Repealing Articles 130 and 131 of Presidential Decree Number Four Hundred Forty-Two, as Amended, Otherwise known as The Labor Code of the Philippines," approved on June 21, 2011, the Labor Code articles beginning with Article 130 are renumbered.

[33] Article 1155 of the Civil Code reads:

ART. 1155. The prescription of actions is interrupted when they are filed before the Court, when there is a written extrajudicial demand by the creditors, and when there is any written acknowledgment of the debt by the debtor. 

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[2014V692] Our Haus Realty vs Alexander Parian, et al

[2014V692] OUR HAUS REALTY DEVELOPMENT CORPORATION, PETITIONER, VS. ALEXANDER PARIAN, JAY C. ERINCO, ALEXANDER CANLAS, BERNARD TENEDERO AND JERRY SABULAO, RESPONDENTS.

G.R. No. 204651, 2014 Aug 6, 2nd Division

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Labor > Labor Standards > Wages

Our Haus' argument is a vain attempt to circumvent the minimum wage law by trying to create a distinction where none exists.

No substantial distinction between deducting and charging a facility's value from the employee's wage; the legal requirements for creditability apply to both.

These requirements are the following:

a. proof must be shown that such facilities are customarily furnished by the trade; b. the provision of deductible facilities must be voluntarily accepted in writing by the employee; and c. The facilities must be charged at fair and reasonable value.

======= utakpinoy.com ===========

D E C I S I O N

BRION, J.:

We resolve in this petition for review on certiorari[1] the challenge to the May 7, 2012 decision[2] and the November 27, 2012 resolution[3] (assailed CA rulings) of the Court of Appeals (CA) in CA-G.R. SP No. 123273. These assailed CA rulings affirmed the July 20, 2011 decision[4] and the December 2, 2011 resolution[5] (NLRC rulings) of the National Labor Relations Commission (NLRC) in NLRC LAC No. 02-000489-11 (NLRC NCR Case No. 06-08544-10). The NLRC rulings in turn reversed and set aside the December 10, 2010 decision[6] of the labor arbiter (LA).

Factual Antecedents

Respondents Alexander Parian, Jay Erinco, Alexander Canlas, Jerry Sabulao and Bernardo Tenedero were all laborers working for petitioner Our Haus Realty Development Corporation (Our Haus), a company engaged in the construction business. The respondents' respective employment records and daily wage rates from 2007 to 2010 are summarized in the table[7] below:

Name Date Years of Year and Place of Daily Rate Hired Service Assignment

Alexander M. Parian October 1999 10 years 2007-2010- Quezon City P353.50

Jay C. Erinco January 2000 10 years 2008- Quezon City P342.00 2009- Antipolo 2010- Quezon City

Alexander R. Canlas 2005 5 years 2007-2010- Quezon City P312.00

Jerry Q. Sabulao August 1999 10 years 2008- Quezon City P342.00 2009- Antipolo 2010- Quezon City

Bernardo N. Tenedero 1994 16 years 2007-2010- Quezon City P383.50

Sometime in May 2010, Our Haus experienced financial distress. To alleviate its condition, Our Haus suspended some of its construction projects and asked the affected workers, including the respondents, to take vacation leaves.[8]

Eventually, the respondents were asked to report back to work but instead of doing so, they filed with the LA a complaint for underpayment of their daily wages. They claimed that except for respondent Bernardo N. Tenedero, their wages were below the minimum rates prescribed in the following wage orders from 2007 to 2010:

Wage Order No. NCR-13, which provides for a daily minimum wage rate of P362.00 for the non-agriculture sector (effective from August 28, 2007 until June 13, 2008); and

Wage Order No. NCR-14, which provides for a daily minimum wage rate of P382.00 for the non-agriculture sector (effective from June 14, 2008 until June 30, 2010).

The respondents also alleged that Our Haus failed to pay them their holiday, service incentive leave (SIL), 13th month and overtime pays.[9]

The Labor Arbitration Rulings

Before the LA, Our Haus primarily argued that the respondents' wages complied with the law's minimum requirement. Aside from paying the monetary amount of the respondents' wages, Our Haus also subsidized their meals (3 times a day), and gave them free lodging near the construction project they were assigned to.[10] In determining the total amount of the respondents' daily wages, the value of these benefits should be considered, in line with Article 97(f)[11] of the Labor Code.

Our Haus also rejected the respondents' other monetary claims for lack of proof that they were entitled to it.[12]

On the other hand, the respondents argued that the value of their meals should not be considered in determining their wages' total amount since the requirements set under Section 4[13] of DOLE[14] Memorandum Circular No. 2[15] were not complied with.

The respondents pointed out that Our Haus never presented any proof that they agreed in writing to the inclusion of their meals' value in their wages.[16] Also, Our Haus failed to prove that the value of the facilities it furnished was fair and reasonable.[17] Finally, instead of deducting the maximum amount of 70% of the value of the meals, Our Haus actually withheld its full value (which was Php290.00 per week for each employee).[18]

The LA ruled in favor of Our Haus. He held that if the reasonable values of the board and lodging would be taken into account, the respondents' daily wages would meet the minimum wage rate.[19] As to the other benefits, the LA found that the respondents were not able to substantiate their claims for it.[20]

The respondents appealed the LA's decision to the NLRC, which in turn, reversed it. Citing the case of Mayon Hotel & Restaurant v. Adana,[21] the NLRC noted that the respondents did not authorize Our Haus in writing to charge the values of their board and lodging to their wages. Thus, the same cannot be credited.

The NLRC also ruled that the respondents are entitled to their respective proportionate 13th month payments for the year 2010 and SIL payments for at least three years, immediately preceding May 31, 2010, the date when the respondents left Our Haus. However, the NLRC sustained the LA's ruling that the respondents were not entitled to overtime pay since the exact dates and times when they rendered overtime work had not been proven.[22]

Our Haus moved for the reconsideration[23] of the NLRC's decision and submitted new evidence (the five kasunduans) to show that the respondents authorized Our Haus in writing to charge the values of their meals and lodging to their wages.

The NLRC denied Our Haus' motion, thus it filed a Rule 65 petition[24] with the CA. In its petition, Our Haus propounded a new theory. It made a distinction between deduction and charging. A written authorization is only necessary if the facility's value will be deducted and will not be needed if it will merely be charged or included in the computation of wages.[25] Our Haus claimed that it did not actually deduct the values of the meals and housing benefits. It only considered these in computing the total amount of wages paid to the respondents for purposes of compliance with the minimum wage law. Hence, the written authorization requirement should not apply.

Our Haus also asserted that the respondents' claim for SIL pay should be denied as this was not included in their pro forma complaint. Lastly, it questioned the respondents' entitlement to attorney's fees because they were not represented by a private lawyer but by the Public Attorney's Office (PAO).

The CA's Ruling

The CA dismissed Our Haus' certiorari petition and affirmed the NLRC rulings in toto. It found no real distinction between deduction and charging,[26] and ruled that the legal requirements before any deduction or charging can be made, apply to both. Our Haus, however, failed to prove that it complied with any of the requirements laid down in Mabeza v. National Labor Relations Commission.[27] Accordingly, it cannot consider the values of its meal and housing facilities in the computation of the respondents' total wages.

Also, the CA ruled that since the respondents were able to allege non-payment of SIL in their position paper, and Our Haus, in fact, opposed it in its various pleadings,[28] then the NLRC properly considered it as part of the respondents' causes of action. Lastly, the CA affirmed the respondent's entitlement to attorney's fees.[29]

Our Haus filed a motion for reconsideration but the CA denied its motion, prompting it to file the present petition for review on certiorari under Rule 45.

The Petition

Our Haus submits that the CA erred in ruling that the legal requirements apply without distinction — whether the facility's value will be deducted or merely included in the computation of the wages. At any rate, it complied with the requirements for deductibility of the value of the facilities. First, the five kasunduans executed by the respondents constitute the written authorization for the inclusion of the board and lodging's values to their wages. Second, Our Haus only withheld the amount of P290.00 which represents the food's raw value; the weekly cooking cost (cook's wage, LPG, water) at P239.40 per person is a separate expense that Our Haus did not withhold from the respondents' wages.[30] This disproves the respondents' claim that it deducted the full amount of the meals' value.

Lastly, the CA erred in ruling that the claim for SIL pay may still be granted though not raised in the complaint; and that the respondents are entitled to an award of attorney's fees.[31]

The Case for the Respondents

The respondents prayed for the denial of the petition.[32] They maintained that the CA did not err in ruling that the values of the board and lodging cannot be deducted from their wages for failure to comply with the requirements set by law.[33] And though the claim for SIL pay was not included in their pro forma complaint, they raised their claims in their position paper and Our Haus had the opportunity to contradict it in its pleadings.[34]

Finally, under the PAO law, the availment of the PAO's legal services does not exempt its clients from an award of attorney's fees.[35]

The Court's Ruling

We resolve to DENY the petition.

The nature of a Rule 45 petition — only questions of law

Basic is the rule that only questions of law may be raised in a Rule 45 petition.[36] However, in this case, we are confronted with mixed questions of fact and law that are subsumed under the issue of whether Our Haus complied with the legal requirements on the deductibility of the value of facilities. Strictly, factual issues cannot be considered under Rule 45 except in the course of resolving if the CA correctly determined whether or not the NLRC committed grave abuse of discretion in considering and appreciating the factual issues before it.[37]

In ruling for legal correctness, we have to view the CA decision in the same context that the petition for certiorari it ruled upon was presented to it; we have to examine the CA decision from the prism of whether it correctly determined the presence or absence of grave abuse of discretion in the NLRC decision before it, not on the basis of whether the NLRC decision, on the merits of the case, was correct. In other words, we have to be keenly aware that the CA undertook a Rule 65 review, not a review on appeal, of the NLRC decision challenged before it. This is the approach that should be basic in a Rule 45 review of a CA ruling in a labor case. In question form, the question to ask in the present case is: did the CA correctly determine that the NLRC did not commit grave abuse of discretion in ruling on the case?[38] We rule that the CA correctly did.

No substantial distinction between deducting and charging a facility's value from the employee's wage; the legal requirements for creditability apply to both

To justify its non-compliance with the requirements for the deductibility of a facility, Our Haus asks us to believe that there is a substantial distinction between the deduction and the charging of a facility's value to the wages. Our Haus explains that in deduction, the amount of the wage (which may already be below the minimum) would still be lessened by the facility's value, thus needing the employee's consent. On the other hand, in charging, there is no reduction of the employee's wage since the facility's value will just be theoretically added to the wage for purposes of complying with the minimum wage requirement.[39]

Our Haus' argument is a vain attempt to circumvent the minimum wage law by trying to create a distinction where none exists.

In reality, deduction and charging both operate to lessen the actual take-home pay of an employee; they are two sides of the same coin. In both, the employee receives a lessened amount because supposedly, the facility's value, which is part of his wage, had already been paid to him in kind. As there is no substantial distinction between the two, the requirements set by law must apply to both.

As the CA correctly ruled, these requirements, as summarized in Mabeza, are the following:

a. proof must be shown that such facilities are customarily furnished by the trade; b. the provision of deductible facilities must be voluntarily accepted in writing by the employee; and c. The facilities must be charged at fair and reasonable value.[40]

We examine Our Haus' compliance with each of these requirements in seriatim. The facility must be customarily furnished by the trade

In a string of cases, we have concluded that one of the badges to show that a facility is customarily furnished by the trade is the existence of a company policy or guideline showing that provisions for a facility were designated as part of the employees' salaries.[41] To comply with this, Our Haus presented in its motion for reconsideration with the NLRC the joint sinumpaang salaysay of four of its alleged employees. These employees averred that they were recipients of free lodging, electricity and water, as well as subsidized meals from Our Haus.[42]

We agree with the NLRC's finding that the sinumpaang salaysay statements submitted by Our Haus are self-serving. For one, Our Haus only produced the documents when the NLRC had already earlier determined that Our Haus failed to prove that it was traditionally giving the respondents their board and lodging. This document did not state whether these benefits had been consistently enjoyed by the rest of Our Haus' employees. Moreover, the records reveal that the board and lodging were given on a per project basis. Our Haus did not show if these benefits were also provided in its other construction projects, thus negating its claimed customary nature.

Even assuming the sinumpaang salaysay to be true, this document would still work against Our Haus' case. If Our Haus really had the practice of freely giving lodging, electricity and water provisions to its employees, then Our Haus should not deduct its values from the respondents' wages. Otherwise, this will run contrary to the affiants' claim that these benefits were traditionally given free of charge.

Apart from company policy, the employer may also prove compliance with the first requirement by showing the existence of an industry-wide practice of furnishing the benefits in question among enterprises engaged in the same line of business. If it were customary among construction companies to provide board and lodging to their workers and treat their values as part of their wages, we would have more reason to conclude that these benefits were really facilities.

However, Our Haus could not really be expected to prove compliance with the first requirement since the living accommodation of workers in the construction industry is not simply a matter of business practice. Peculiar to the construction business are the occupational safety and health (OSH) services which the law itself mandates employers to provide to their workers. This is to ensure the humane working conditions of construction employees despite their constant exposure to hazardous working environments. Under Section 16 of DOLE Department Order (DO) No. 13, series of 1998,[43] employers engaged in the construction business are required to provide the following welfare amenities:

16.1 Adequate supply of safe drinking water

16.2 Adequate sanitary and washing facilities

16.3 Suitable living accommodation for workers, and as may be applicable, for their families

16.4 Separate sanitary, washing and sleeping facilities for men and women workers. [emphasis ours]

Moreover, DOLE DO No. 56, series of 2005, which sets out the guidelines for the implementation of DOLE DO No. 13, mandates that the cost of the implementation of the requirements for the construction safety and health of workers, shall be integrated to the overall project cost.[44] The rationale behind this is to ensure that the living accommodation of the workers is not substandard and is strictly compliant with the DOLE's OSH criteria.

As part of the project cost that construction companies already charge to their clients, the value of the housing of their workers cannot be charged again to their employees' salaries. Our Haus cannot pass the burden of the OSH costs of its construction projects to its employees by deducting it as facilities. This is Our Haus' obligation under the law.

Lastly, even if a benefit is customarily provided by the trade, it must still pass the purpose test set by jurisprudence. Under this test, if a benefit or privilege granted to the employee is clearly for the employer's convenience, it will not be considered as a facility but a supplement.[45] Here, careful consideration is given to the nature of the employer's business in relation to the work performed by the employee. This test is used to address inequitable situations wherein employers consider a benefit deductible from the wages even if the factual circumstances show that it clearly redounds to the employers' greater advantage.

While the rules serve as the initial test in characterizing a benefit as a facility, the purpose test additionally recognizes that the employer and the employee do not stand at the same bargaining positions on benefits that must or must not form part of an employee's wage. In the ultimate analysis, the purpose test seeks to prevent a circumvention of the minimum wage law. a1. The purpose test in jurisprudence Under the law,[46] only the value of the facilities may be deducted from the employees' wages but not the value of supplements. Facilities include articles or services for the benefit of the employee or his family but exclude tools of the trade or articles or services primarily for the benefit of the employer or necessary to the conduct of the employer's business.[47]

The law also prescribes that the computation of wages shall exclude whatever benefits, supplements or allowances given to employees. Supplements are paid to employees on top of their basic pay and are free of charge.[48] Since it does not form part of the wage, a supplement's value may not be included in the determination of whether an employer complied with the prescribed minimum wage rates.

In the present case, the board and lodging provided by Our Haus cannot be categorized as facilities but as supplements. In SLL International Cables Specialist v. National Labor Relations Commission,[49] this Court was confronted with the issue on the proper characterization of the free board and lodging provided by the employer. We explained:

The Court, at this point, makes a distinction between "facilities" and "supplements". It is of the view that the food and lodging, or the electricity and water allegedly consumed by private respondents in this case were not facilities but supplements. In the case of Atok-Big Wedge Assn. v. Atok-Big Wedge Co., the two terms were distinguished from one another in this wise:

"Supplements", therefore, constitute extra remuneration or special privileges or benefits given to or received by the laborers over and above their ordinary earnings or wages. "Facilities", on the other hand, are items of expense necessary for the laborer's and his family's existence and subsistence so that by express provision of law (Sec. 2[g]), 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.

In short, the benefit or privilege given to the employee which constitutes an extra remuneration above and over his basic or ordinary earning or wage is supplement; and when said benefit or privilege is part of the laborers' basic wages, it is a facility. The distinction lies not so much in the kind of benefit or item (food, lodging, bonus or sick leave) given, but in the purpose for which it is given. In the case at bench, the items provided were given freely by SLL for the purpose of maintaining the efficiency and health of its workers while they were working at their respective projects.[50]

Ultimately, the real difference lies not on the kind of the benefit but on the purpose why it was given by the employer. If it is primarily for the employee's gain, then the benefit is a facility; if its provision is mainly for the employer's advantage, then it is a supplement. Again, this is to ensure that employees are protected in circumstances where the employer designates a benefit as deductible from the wages even though it clearly works to the employer's greater convenience or advantage.

Under the purpose test, substantial consideration must be given to the nature of the employer's business in relation to the character or type of work performed by the employees involved.

Our Haus is engaged in the construction business, a labor-intensive enterprise. The success of its projects is largely a function of the physical strength, vitality and efficiency of its laborers. Its business will be jeopardized if its workers are weak, sickly, and lack the required energy to perform strenuous physical activities. Thus, by ensuring that the workers are adequately and well fed, the employer is actually investing on its business.

Unlike in office enterprises where the work is focused on desk jobs, the construction industry relies heavily and directly on the physical capacity and endurance of its workers. This is not to say that desk jobs do not require muscle strength; we simply emphasize that in the construction business, bulk of the work performed are strenuous physical activities.

Moreover, in the construction business, contractors are usually faced with the problem of meeting target deadlines. More often than not, work is performed continuously, day and night, in order to finish the project on the designated turn-over date. Thus, it will be more convenient to the employer if its workers are housed near the construction site to ensure their ready availability during urgent or emergency circumstances. Also, productivity issues like tardiness and unexpected absences would be minimized. This observation strongly bears in the present case since three of the respondents are not residents of the National Capital Region. The board and lodging provision might have been a substantial consideration in their acceptance of employment in a place distant from their provincial residences.

Based on these considerations, we conclude that even under the purpose test, the subsidized meals and free lodging provided by Our Haus are actually supplements. Although they also work to benefit the respondents, an analysis of the nature of these benefits in relation to Our Haus' business shows that they were given primarily for Our Haus' greater convenience and advantage. If weighed on a scale, the balance tilts more towards Our Haus' side. Accordingly, their values cannot be considered in computing the total amount of the respondents' wages.

Under the circumstances, the daily wages paid to the respondents are clearly below the prescribed minimum wage rates in the years 2007-2010.

The provision of deductible facilities must be voluntarily accepted in writing by the employee In Mayon Hotel, we reiterated that a facility may only be deducted from the wage if the employer was authorized in writing by the concerned employee.[51] As it diminishes the take-home pay of an employee, the deduction must be with his express consent.

Again, in the motion for reconsideration with the NLRC, Our Haus belatedly submitted five kasunduans, supposedly executed by the respondents, containing their conformity to the inclusion of the values of the meals and housing to their total wages. Oddly, Our Haus only offered these documents when the NLRC had already ruled that respondents did not accomplish any written authorization, to allow deduction from their wages. These five kasunduans were also undated, making us wonder if they had really been executed when respondents first assumed their jobs.

Moreover, in the earlier sinumpaang salaysay by Our Haus' four employees, it was not mentioned that they also executed a kasunduan for their board and lodging benefits. Because of these surrounding circumstances and the suspicious timing when the five kasunduans were submitted as evidence, we agree with the CA that the NLRC committed no grave abuse of discretion in disregarding these documents for being self serving. The facility must be charged at a fair and reasonable value Our Haus admitted that it deducted the amount of P290.00 per week from each of the respondents for their meals. But it now submits that it did not actually withhold the entire amount as it did not figure in the computation the money it expended for the salary of the cook, the water, and the LPG used for cooking, which amounts to P249.40 per week per person. From these, it appears that the total meal expense per week for each person is P529.40, making Our Haus' P290.00 deduction within the 70% ceiling prescribed by the rules.

However, Our Haus' valuation cannot be plucked out of thin air. The valuation of a facility must be supported by relevant documents such as receipts and company records for it to be considered as fair and reasonable. In Mabeza, we noted:

Curiously, in the case at bench, the only valuations relied upon by the labor arbiter in his decision were figures furnished by the private respondent's own accountant, without corroborative evidence. On the pretext that records prior to the July 16, 1990 earthquake were lost or destroyed, respondent failed to produce payroll records, receipts and other relevant documents, where he could have, as has been pointed out in the Solicitor General's manifestation, "secured certified copies thereof from the nearest regional office of the Department of Labor, the SSS or the BIR".[52] [emphasis ours]

In the present case, Our Haus never explained how it came up with the values it assigned for the benefits it provided; it merely listed its supposed expenses without any supporting document. Since Our Haus is using these additional expenses (cook's salary, water and LPG) to support its claim that it did not withhold the full amount of the meals' value, Our Haus is burdened to present evidence to corroborate its claim. The records however, are bereft of any evidence to support Our Haus' meal expense computation. Even the value it assigned for the respondents' living accommodations was not supported by any documentary evidence. Without any corroborative evidence, it cannot be said that Our Haus complied with this third requisite.

A claim not raised in the pro forma complaint may still be raised in the position paper.

Our Haus questions the respondents' entitlement to SIL pay by pointing out that this claim was not included in the pro forma complaint filed with the NLRC. However, we agree with the CA that such omission does not bar the labor tribunals from touching upon this cause of action since this was raised and discussed in the respondents' position paper. In Samar-Med Distribution v. National Labor Relations Commission,[53] we held:

Firstly, petitioner's contention that the validity of Gutang's dismissal should not be determined because it had not been included in his complaint before the NLRC is bereft of merit. The complaint of Gutang was a mere checklist of possible causes of action that he might have against Roleda. Such manner of preparing the complaint was obviously designed to facilitate the filing of complaints by employees and laborers who are thereby enabled to expediently set forth their grievances in a general manner. But the non-inclusion in the complaint of the issue on the dismissal did not necessarily mean that the validity of the dismissal could not be an issue. The rules of the NLRC require the submission of verified position papers by the parties should they fail to agree upon an amicable settlement, and bar the inclusion of any cause of action not mentioned in the complaint or position paper from the time of their submission by the parties. In view of this, Gutang's cause of action should be ascertained not from a reading of his complaint alone but also from a consideration and evaluation of both his complaint and position paper.[54]

The respondents' entitlement to the other monetary benefits

Generally a party who alleges payment as a defense has the burden of proving it. Particularly in labor cases, the burden of proving payment of monetary claims rests on the employer on the reasoning that the pertinent personnel files, payrolls, records, remittances and other similar documents — which will show that overtime, differentials, service incentive leave and other claims of workers have been paid — are not in the possession of the worker but in the custody and absolute control of the employer.[55]

Unfortunately, records will disclose the absence of any credible document which will show that respondents had been paid their 13th month pay, holiday and SIL pays. Our Haus merely presented a hand-written certification from its administrative officer that its employees automatically become entitled to five days of service incentive leave as soon as they pass probation. This certification was not even subscribed under oath. Our Haus could have at least submitted its payroll or copies of the pay slips of respondents to show payment of these benefits. However, it failed to do so.

Respondents are entitled to attorney's fees.

Finally, we affirm that respondents are entitled to attorney's fees. Our Haus' asserts that respondents' availment of free legal services from the PAO disqualifies them from such award. We find this untenable.

It is settled that in actions for recovery of wages or where an employee was forced to litigate and, thus, incur expenses to protect his rights and interest, the award of attorney's fees is legally and morally justifiable.[56] Moreover, under the PAO Law or Republic Act No. 9406, the costs of the suit, attorney's fees and contingent fees imposed upon the adversary of the PAO clients after a successful litigation shall be deposited in the National Treasury as trust fund and shall be disbursed for special allowances of authorized officials and lawyers of the PAO.[57]

Thus, the respondents are still entitled to attorney's fees. The attorney's fees awarded to them shall be paid to the PAO. It serves as a token recompense to the PAO for its provision of free legal services to litigants who have no means of hiring a private lawyer.

WHEREFORE, in light of these considerations, we conclude that the Court of Appeals correctly found that the National Labor Relations Commission did not abuse its discretion in its decision of July 20, 2011 and Resolution of December 2, 2011. Consequently we DENY the petition and AFFIRM the Court of Appeals' decision dated May 7, 2012 and resolution dated November 27, 2012 in CA-G.R. SP No. 123273. No costs.

SO ORDERED.

Carpio, (Chairperson), Del Castillo, Perez, and Perlas-Bernabe, JJ., concur.

[1] Rollo, pp. 7-26.

[2] Penned by Associate Justice Rodil V. Zalameda, and concurred in by Associate Justices Rebecca De Guia-Salvador and Normandie B. Pizarro; Id. at 28-42.

[3] Id. at 43-44.

[4] Penned by Commissioner Dolores M. Peralta-Beley, and concurred in by Commissioners Leonardo L. Leonida and Mercedes R. Posada-Lacap; Id. at 62-69.

[5] Id. at 70-76.

[6] Penned by Labor Arbiter Antonio R. Macam; Id. at 129-137.

[7] Id. at 81.

[8] Id. at 100.

[9] Id. at 81-82.

[10] Id. at 103.

[11] "Wage" paid to any employee shall mean the remuneration or earnings, however designated, capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the same, which is payable by an employer to an employee under a written or unwritten contract of employment for work done or to be done, or for services rendered or to be rendered and 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. "Fair and reasonable value" shall not include any profit to the employer or to any person affiliated with the employer. [italics and underscoring ours]

[12] Rollo, p. 104.

[13] Cash Wage. - The minimum wage rates prescribed in Section 1 hereof shall be basic, cash wages. An employer may provide subsidized meals and snacks to his employees provided that the subsidy shall not be less than 30% of the fair and reasonable value of such facilities. In such case, the employer may deduct from the wages of the employees not more than 70% of the value of the meals and snacks enjoyed by the employees, provided that such deduction is with the written authorization of the employees concerned. [emphasis ours]

[14] Department of Labor and Employment.

[15] Book III, Rule VII-A of the Implementing Rules and Regulations of the Labor Code, November 4, 1992.

[16] Rollo, p. 126.

[17] Id.

[18] Id.

[19] Id. at 136.

[20] Id. at 136-137.

[21] 497 Phil. 892, 928 (2005).

[22] Rollo, pp. 67-68.

[23] Id. at 161-167.

[24] Id. at 45-61.

[25] Id. at 35.

[26] Id.

[27] 338 Phil. 386 (1997).

[28] Rollo, p. 38.

[29] Id. at 40.

[30] Id. at 20.

[31] Id. at 24.

[32] Id. at 215-238.

[33] Id. at 227.

[34] Id. at 230.

[35] Id. at 232-233.

[36] Career Philippines Shipmanagement, Inc. v. Serna, G.R. No. 172086, December 3, 2012, 686 SCRA 676, 683.

[37] Montoya v. Transmed Manila Corp./Ellena, et al., 613 Phil. 696, 707 (2009).

[38] Id.

[39] Rollo, p. 16.

[40] Mabeza v. National Labor Relations Commission, supra note 27, at 399; emphasis ours.

[41] SLL International Cables Specialist v. National Labor Relations Commission, G.R. No. 172161, March 2, 2011, 644 SCRA 411, 422-423; citing Atok-Big Wedge Assn. v. Atok-Big Wedge Co., 97 Phil. 294 (1955).

[42] Rollo, p. 173.

[43] Guidelines Governing Occupational Safety and Health in the Construction Industry.

[44] III. General Guidelines

A. In compliance with Section 17 of DOLE D. O. No. 13, the implementation of construction safety shall be considered in all stages of project procurement (design, estimate, and construction) and its cost shall be integrated to the overall project cost under Pay Item "SPL- Construction Safety and Health" as a lump sum amount, to be quantified in the detailed estimate. Likewise, all requirements, provisions, and instructions pertaining to the implementation of Construction Safety and Health in every project shall be included in the project bidding documents specifically under the Instructions to Bidders.

[45] Mabeza v. National Labor Relations Commission, supra note 27, at 400.

[46] Section 4 of DOLE Memorandum Circular No. 2 provides that the minimum wage rates shall be the basic, cash wages without deducting therefrom whatever benefits, supplements or allowances which the employees enjoy free of charge aside from the basic pay.

[47] Section 2, DOLE Memorandum Circular No. 2.

[48] Section 4, DOLE Memorandum Circular No. 2.

[49] Supra note 41.

[50] Id. at 422-423; citations omitted; italics supplied; emphasis and underscoring ours.

[51] Mayon Hotel & Restaurant v. Adana, supra note 21, at 928.

[52] Mabeza v. National Labor Relations Commission, supra note 27, at 400.

[53] G.R. No. 162385, July 15, 2013, 701 SCRA 148.

[54] Id. at 159; citation omitted; emphasis and underscoring ours.

[55] SLL International Cables Specialist v. National Labor Relations Commission, supra note 41, at 420.

[56] Aliling v. Feliciano, G.R. No. 185829, April 25, 2012, 671 SCRA 186, 220.

[57] Section 6 of Republic Act No. 9406, inserting Section 16-D in Chapter 5, Title III, Book IV of Executive Order No. 292.