SECOND DIVISION
|
SAN MIGUEL CORPORATION, ANDRES SORIANO III, FRANCISCO C. EIZMENDI, JR., and FAUSTINO F. GALANG, Petitioners,
- versus - NUMERIANO LAYOC, JR., CARLOS APONESTO, PAULINO
BALDUGO, QUEZON BARIT, BONIFACIO BOTOR, HERMINIO CALINA, DANILO CAMINGAL,
JUAN DE MESA, REYNOLD DESEMBRANA, BERNARDITO DEUS, EDUARDO FILLARTA,
MAXIMIANO FRANCISCO, MARIO MARILIM, DEMETRIO MATEO, FILOMENO MENDOZA,
CONRADO NIEVA, FRANCISCO PALINES, FELIPE POLINTAN, MALCOLM SATORRE, and ALEJANDRO TORRES, Respondents. |
|
G.R. No. 149640 Present: QUISUMBING, J., Chairperson, CARPIO, CARPIO MORALES, TINGA, and VELASCO, JR., JJ. Promulgated: October 19, 2007 |
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D E C I S I O N
CARPIO, J.:
The Case
This is a
petition for review[1]
of the decision[2]
promulgated on
P125,000,
representing overtime pay for services that he could have rendered from January
1993 up to his retirement on 30 June 1997, and respondents Carlos Aponesto, Paulino Baldugo, Quezon Barit, Bonifacio Botor, Herminio Calina, Danilo Camingal, Juan de Mesa, Reynold Desembrana, Bernardito Deus,
Eduardo Fillarta, Maximiano
Francisco, Mario Marilim, Demetrio
Mateo, Filomeno Mendoza, Conrado
Nieva, Francisco Palines,
Felipe Polintan, Malcolm Satorre,
and Alejandro Torres (collectively, respondents) P10,000 each as nominal
damages.
The Facts
The appellate
court stated the facts as follows:
[Respondents]
were among the “Supervisory Security Guards” of the Beer Division of the San
Miguel Corporation (p. 10, Rollo), a domestic
corporation duly organized and existing under and by virtue of the laws of the
Republic of the
different dates until such time that they were promoted as supervising security guards. The dates of their employment commenced as follows (Ibid., pp. 87-89):
|
|
|
As guards |
As supervising guards |
|
|
|
|
|
|
a. |
Aponesto, Carlos |
June 1970 |
February 1983 |
|
b. |
Baldugo, Paulino |
November 1978 |
May 1984 |
|
c. |
Barit, Quezon |
January 1969 |
May 1984 |
|
d. |
Botor, Bonifacio |
April 1980 |
January 1987 |
|
e. |
De Mesa, Juan |
November 1977 |
May 1984 |
|
f. |
Calina, Herminio |
February 1976 |
May 1984 |
|
g. |
Desembrana, Reynold |
November 1976 |
April 1983 |
|
h. |
Camingal, Danilo |
December 1975 |
December 1985 |
|
i. |
Deus, Bernardito |
July 1976 |
May 1983 |
|
j. |
Fillarta, Eduardo |
January 1979 |
May 1989 |
|
k. |
Francisco, Maximiano |
October 1977 |
May 1984 |
|
l. |
Layoc, Numeriano |
June 1974 |
January 1982 |
|
m. |
Marilim, Mario |
December 1977 |
June 1984 |
|
n. |
Mateo, Demetrio |
November 1976 |
March 1984 |
|
o. |
Mendoza, Filomena |
March 1980 |
May 1983 |
|
p. |
Palines, Francisco |
May 1979 |
May 1985 |
|
q. |
Nieva, Conrado |
January 1977 |
June 1987 |
|
r. |
Polintan, Felipe |
June 1972 |
May 1983 |
|
s. |
Satorre, Malcolm |
September 1970 |
May 1984 |
|
t. |
Torres, Alejandro |
January 1974 |
May 1984 |
As supervising security guards, the private respondents were performing the following functions (Ibid., pp. 202-204):
1. Supervises the facility security force under his shift;
2. Inspects all company-owned firearms and ammunition and promptly submits report as regards to discrepancy and/or state of doubtful/suspected serviceability;
3. Receives and transfers from outgoing to incoming supervising security guard all company property, all official papers, documents and/or cases investigated including pieces of evidence properly labeled and secured;
4. Physically checks and accounts for all company property within his area of responsibility immediately upon assumption of duty;
5. Updates compilation of local security rules, policies and regulations and ensures that all his guards are posted thereon;
6. Conducts regular and irregular inspection to determine his guards’ compliance with all guard force instructions, corporate security standards and procedures;
7. Passes on all official communications, requests, applications of leaves, etc. and makes his comments and/or recommendations to his superior;
8. Systematically and continuously screens the good performers from the marginal or poor among his guards; concentrates on teaching and guiding the latter; determines further what training and/or skills that should be learned and submits appropriate report to superior;
9. Corrects, on the spot, all deficiencies noted and institutes corrective measures within his authority; recommends commendations for those guards who deserves [sic] recognition for good work;
10. Conducts an investigation of all cases coming to his attention and promptly submits appropriate report to his superiors;
11. Evaluates individual guard performance and renders efficiency reports in accordance with standing instructions;
12. Ensures that all his guards are courteous, respectful and accommodating at all times;
13. Ensures that even those who have been found violating the facility’s policies, rules and procedures are professionally treated with courtesy and understanding to preclude embarrassment and humiliation;
14. Ensures the maintenance of [a] logbook of all incidents, communications, personnel and materials’ movements;
15. Responds to all calls for assistance;
16. Conducts continuing physical checks of the facility’s critical and vulnerable areas;
17. Obtains critical security information and passes it on to his superiors;
18. Assesses the need for extra guard service requirements;
19. Continuously monitors the personal needs and problems of his men to his superiors;
20. Acts as Detachment Commander in the latter’s absence;
21. Responds to emergencies and activates the Corporate Security Alerting System as appropriate; and
22. Performs such other duties as may be required by his Detachment Commander/Plant Security Officer.
From the commencement of their employment, the private respondents were required to punch their time cards for purposes of determining the time they would come in and out of the company’s work place. Corollary [sic], the private respondents were availing the benefits for overtime, holiday and night premium duty through time card punching (Rollo, p. 89). However, in the early 1990’s, the San Miguel Corporation embarked on a Decentralization Program aimed at enabling the separate divisions of the San Miguel Corporation to pursue a more efficient and effective management of their respective operations (Ibid., p. 99).
As a
result of the Decentralization Program, the Beer Division of the San Miguel Corporation
implemented on
However,
in lieu of the overtime pay and the premium pay, the personnel of the Beer
Division of the petitioner San Miguel Corporation affected by the “No Time Card
Policy” were given a 10% across-the-board increase on their basic pay while the
supervisors who were assigned in the night shift (6:00 p.m. to 6:00 a.m.) were
given night shift allowance ranging from P2,000.00 to P2,500.00 a
month (Rollo, p. 12).[6]
On
In their
position paper dated
In their
position paper dated P2,000
or P2,500 night shift allowance on top of their yearly merit
increase. Petitioners further asserted
that the “no time card policy” was a valid exercise of management prerogative
and that all supervisors in the Beer Division were covered by the “no time card
policy,” which classification was distinct and separate from the other
divisions within SMC.
Respondents
filed their reply dated
The Ruling of the Labor Arbiter
In his
decision dated
WHEREFORE, the [petitioners] are hereby ordered to restore to the [respondents] their right to earn for overtime services rendered as enjoyed by the other employees.
The
[petitioners] are further ordered to indemnify the [respondents] for lost
earnings after their terms and conditions of employment have been unilaterally
altered by the [petitioners], namely in the amount of P500,000.00 each
as computed by the [respondents], and the [petitioners] failed to refute.
[Petitioners]
are furthermore ordered to pay the [respondents] P100,000.00 each as
moral and exemplary damages.
All other claims are hereby dismissed for lack of evidence.
SO ORDERED.[7]
On
The Ruling of the NLRC
On 27 November
1998, the NLRC affirmed with modification the ruling of Arbiter Canizares that respondents suffered a diminution of
benefits as a result of the adoption of the “no time card policy.” The NLRC cited a well-established rule that
employees have a vested right over existing benefits voluntarily granted to
them by their employer, who may not unilaterally withdraw, eliminate, or
diminish such benefits. In the present
case, there was a company practice which allowed the enjoyment of substantial
additional remuneration. Furthermore,
there is no rule excluding managerial employees from the coverage of the
principle of non-diminution of benefits.
The NLRC ruled
thus:
WHEREFORE, the decision appealed from is hereby AFFIRMED, with slight modification deleting the award of moral and exemplary damages.
SO
ORDERED.[8]
Both petitioners and respondents
filed their respective motions for reconsideration. Petitioners stated that the NLRC erred in
sustaining the award of overtime pay despite its finding that respondents were
managerial personnel. Furthermore, there
was no evidence that respondents rendered overtime work and respondents admitted
that they never or seldom rendered overtime work. The award of overtime pay was thus contrary
to the principle of no work, no pay. For
their part, respondents stated that the NLRC erred in deleting the award of
moral and exemplary damages. The implementation
of the “no time card policy,” the discrimination against them vis-a-vis the supervising security officers in other
divisions of SMC, and the execution of quitclaims and releases during the pendency of the case were all attended with bad faith, thus
warranting the award of moral and exemplary damages.
On 31 August
1999, the NLRC further modified Arbiter Canizares’
decision. The NLRC ruled thus:
WHEREFORE,
the November 27, 1998 Decision of this Commission is hereby REITERATED with a
slight modification to the effect that the computation of the [respondents]’
withdrawn benefits at P125,000.00 yearly from 1993 should terminate in
1996 or the date of each complainant’s retirement, whichever came first.
SO
ORDERED.[9]
Petitioners
then filed their petition for certiorari before the appellate court on 16
November 1999.
The Ruling of the Appellate Court
On 29 August 2001, the appellate
court set aside the ruling of the NLRC and entered a new judgment in favor of
respondents. The appellate court stated
that there is no legal issue that respondents, being the supervisory security
guards of the Beer Division of SMC, were performing duties and responsibilities
being performed by those who were considered as officers or members of the
managerial staff as defined under Section 2, paragraph (c), Rule 1, Book III of
the Implementing Rules of the Labor Code.[10] The appellate court ruled that while the
implementation of the “no time card policy” was a valid exercise of management
prerogative, the rendering of overtime work by respondents was a long-accepted
practice in SMC which could not be peremptorily withdrawn without running afoul
with the principles of justice and equity.
The appellate court affirmed the deletion of the award of actual, moral,
and exemplary damages. With the
exception of Layoc, respondents did not present proof
of previous earnings from overtime work and were not awarded with actual
damages. Moreover, the appellate court
did not find that the implementation of the “no time card policy” caused any
physical suffering, moral shock, social humiliation, besmirched reputation, and
similar injury to respondents to justify the award of moral and exemplary
damages. Nonetheless, in the absence of
competent proof on the specific amounts of actual damages suffered by
respondents, the appellate court awarded them nominal damages.
The dispositive portion of the appellate court’s decision reads
thus:
WHEREFORE, foregoing considered, the instant petition is hereby GIVEN DUE COURSE and is GRANTED. The Decision issued in NLRC NCR CASE No. 00-12-08656-94 dated March 23, 1998, the Decision issued in NLRC CA No. 015710-98 dated November 27, 1998 and the Resolution dated August 31, 1999, are hereby ANNULLED and SET ASIDE, and a new judgment is hereby entered ordering the petitioners to pay as follows:
1) the private respondent Numeriano Layoc, Jr., the amount
of One Hundred Twenty-Five Thousand (P125,000.00) Pesos per year,
representing overtime pay for overtime services that he could have rendered
computed from the date of the implementation of the “no time card policy” or on
January 1993 and up to the date of his retirement on June 30, 1997; and
2) the other private respondents, the
amount of Ten Thousand (P10,000.00) Pesos each as nominal damages.
SO ORDERED.[11]
Dissatisfied
with the appellate court’s ruling, petitioners filed a petition before this
Court.
The Issues
Petitioners
ask whether the circumstances in the present case constitute an exception to
the rule that supervisory employees are not entitled to overtime pay.
Respondents,
on the other hand, question petitioners’ procedure. Respondents submit that the Court should
dismiss the present petition because petitioners did not file a motion for
reconsideration before the appellate court.
The Ruling of the Court
The petition
has merit.
Requirement of Prior Filing of a
Motion for Reconsideration
It appears
that respondents confuse certiorari as a mode of appeal under Rule 45 of the
1997 Rules of Civil Procedure with certiorari as an original special civil
action under Rule 65 of the same Rules.
In Paa v. Court of Appeals,[12] we stated that:
There are, of course, settled distinctions between a petition for review as a mode of appeal and a special civil action for certiorari, thus:
a. In appeal by certiorari, the petition is based on questions of law which the appellant desires the appellate court to resolve. In certiorari as an original action, the petition raises the issue as to whether the lower court acted without or in excess of jurisdiction or with grave abuse of discretion.
b. Certiorari, as a mode of appeal, involves the review of the judgment, award or final order on the merits. The original action for certiorari may be directed against an interlocutory order of the court prior to appeal from the judgment or where there is no appeal or any other plain, speedy or adequate remedy.
c. Appeal by certiorari must be made within the reglementary period for appeal. An original action for certiorari may be filed not later than sixty (60) days from notice of the judgment, order or resolution sought to be assailed.
d. Appeal by certiorari stays the judgment, award or order appealed from. An original action for certiorari, unless a writ of preliminary injunction or a temporary restraining order shall have been issued, does not stay the challenged proceeding.
e. In appeal by certiorari, the petitioner and respondent are the original parties to the action, and the lower court or quasi-judicial agency is not to be impleaded. In certiorari as an original action, the parties are the aggrieved party against the lower court or quasi-judicial agency and the prevailing parties, who thereby respectively become the petitioner and respondents.
f. In certiorari for purposes of appeal, the
prior filing of a motion for reconsideration is not required (Sec. 1, Rule
45); while in certiorari as an
original action, a motion for reconsideration is a condition precedent (Villa-Rey Transit vs. Bello, L-18957,
April 23, 1963), subject to certain exceptions.
g. In appeal by certiorari, the appellate court is in the exercise of its appellate jurisdiction and power of review for, while in certiorari as an original action, the higher court exercises original jurisdiction under its power of control and supervision over the proceedings of lower courts. (Emphasis added)
Respondents’
contention that the present petition should be denied for failure to file a
motion for reconsideration before the appellate court is, therefore, incorrect.
Overtime Work and Overtime Pay
for Supervisory Employees
Both
petitioners and respondents agree that respondents are supervising security
guards and, thus, managerial employees.
The dispute lies on whether respondents are entitled to render overtime
work and receive overtime pay despite the institution of the “no time card
policy” because (1) SMC previously allowed them to render overtime work and
paid them accordingly, and (2) supervising security guards in other SMC
divisions are allowed to render overtime work and receive the corresponding
overtime pay.
Article 82[13] of the Labor Code states
that the provisions of the Labor Code on working conditions and rest periods
shall not apply to managerial employees.
The other provisions in the Title include normal hours of work (Article
83), hours worked (Article 84), meal periods (Article 85), night shift
differential (Article 86), overtime work (Article 87), undertime
not offset by overtime (Article 88),
emergency overtime work (Article 89), and computation of additional compensation
(Article 90). It is thus clear that,
generally, managerial employees such as respondents are not entitled to
overtime pay for services rendered in excess of eight hours a day. Respondents failed to show that the
circumstances of the present case constitute an exception to this general rule.
First,
respondents assert that Article 100[14] of the Labor Code
prohibits the elimination or diminution of benefits. However, contrary to the nature of benefits,
petitioners did not freely give the payment for overtime work to
respondents. Petitioners paid
respondents overtime pay as compensation for services rendered in
addition to the regular work hours.
Respondents rendered overtime work only when their services were needed
after their regular working hours and only upon the instructions of their
superiors. Respondents even differ as to
the amount of overtime pay received on account of the difference in the
additional hours of services rendered.
To illustrate, Layoc’s records[15] show the varying number
of hours of overtime work he rendered and the varying amounts of overtime pay
he received from the years 1978 to 1981 and from 1983 to 1994:
|
|
Number of
Hours Worked Overtime |
Overtime Pay
Received (in Pesos) |
|
1974 – Appointment as guard |
No record |
No record |
|
1975 |
No record |
No record |
|
1976 |
No record |
No record |
|
1977 |
No record |
No record |
|
1978 |
1,424.00 |
5,214.88 |
|
1979 |
1,312.56 |
5,189.30 |
|
1980 |
1,357.50 |
5,155.71 |
|
1981 |
474.00 |
1,781.81 |
|
1982 –
Appointment as supervising security guard |
No record |
No record |
|
1983 |
947.50 |
6,304.33 |
|
1984 |
889.00 |
8,937.00 |
|
1985 |
898.00 |
12,337.47 |
|
1986 |
1,086.60 |
18,085.34 |
|
1987 |
1,039.50 |
32,109.85 |
|
1988 |
633.00 |
29,126.10 |
|
1989 |
723.50 |
39,594.55 |
|
1990 |
376.50 |
21,873.33 |
|
1991 |
149.50 |
12,694.97 |
|
1992 |
144.00 |
17,403.38 |
|
1993 |
0.50 |
47.69 |
|
1994 |
0.00 |
0.00 |
|
1995 |
0.00 |
0.00 |
Aside from their allegations, respondents were not able to
present anything to prove that petitioners were obliged to permit respondents
to render overtime work and give them the corresponding overtime pay. Even if petitioners did not institute a “no
time card policy,” respondents could not demand overtime pay from petitioners
if respondents did not render overtime work.
The requirement of rendering additional service differentiates overtime
pay from benefits such as thirteenth month pay or yearly merit increase. These
benefits do not require any additional service from their beneficiaries. Thus,
overtime pay does not fall within the definition of benefits under Article 100
of the Labor Code.[16]
Second,
respondents allege that petitioners discriminated against them vis-a-vis supervising security guards in other SMC
divisions. Respondents state that they
should be treated in the same manner as supervising security guards in the
Packaging Products Division, who are allowed to render overtime work and thus
receive overtime pay. Petitioners
counter by saying that the “no time card policy” was applied to all supervisory
personnel in the Beer Division. Petitioners
further assert that there would be discrimination if respondents were treated
differently from other supervising security guards within the Beer Division or
if other supervisors in the Beer Division are allowed to render overtime work
and receive overtime pay. The Beer
Division merely exercised its management prerogative of treating its
supervisors differently from its rank-and-file employees, both as to
responsibilities and compensation, as they are not similarly situated.
We agree with
petitioners’ position that given the discretion granted to the various
divisions of SMC in the management and operation of their respective businesses
and in the formulation and implementation of policies affecting their
operations and their personnel, the “no time card policy” affecting all of the
supervisory employees of the Beer Division is a valid exercise of management
prerogative. The “no time card policy”
undoubtedly caused pecuniary loss to respondents.[17] However, petitioners granted to respondents
and other supervisory employees a 10% across-the-board increase in pay and
night shift allowance, in addition to their yearly merit increase in basic
salary, to cushion the impact of the loss.
So long as a company’s management prerogatives are exercised in good faith
for the advancement of the employer’s interest and not for the purpose of
defeating or circumventing the rights of the employees under special laws or
under valid agreements, this Court will uphold them.[18]
WHEREFORE,
the petition is GRANTED. The
Decision dated
SO ORDERED.
ANTONIO
T. CARPIO
Associate
Justice
WE CONCUR:
LEONARDO A. QUISUMBING
Associate Justice
Chairperson
|
CONCHITA CARPIO MORALES Associate Justice |
DANTE O. TINGA Associate
Justice |
PRESBITERO J. VELASCO, JR.
Associate Justice
ATTESTATION
I attest that the conclusions in the above Decision had
been reached in consultation before the case was assigned to the writer of the
opinion of the Court’s Division.
LEONARDO
A. QUISUMBING
Associate Justice
Chairperson
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution,
and the Division Chairperson’s Attestation, I certify that the conclusions in
the above Decision had been reached in consultation before the case was
assigned to the writer of the opinion of the Court’s Division.
REYNATO S. PUNO
[1] Under Rule 45 of the 1997 Rules of Civil Procedure.
[2] Rollo, pp. 370-383. Penned by Associate Justice Bennie A. Adefuin-De La Cruz with Associate Justices Andres B. Reyes, Jr. and Mercedes Gozo-Dadole, concurring.
[3]
[4]
[6] Rollo, pp. 371-373.
[7]
[8]
[9] Records, p. 795.
[10] Sec. 2. Exemption. — The provisions of
this rule shall not apply to the following persons if they qualify for exemption under the conditions set
forth herein:
x x x
(b) Managerial
employees, x x x
(c) Officers
or members of a managerial staff if they perform the following duties and responsibilities:
(1) The
primary duty consists of the performance of work directly related to management
policies of their employer;
(2) Customarily
and regularly exercise discretion and independent judgment;
(3)
(i) Regularly
and directly assist a proprietor or a managerial employee whose primary duty
consists of the management of the establishment in which he is employed
or subdivision thereof; or (ii) execute under general
supervision work along specialized or technical lines requiring special
training, experience, or knowledge; or (iii) execute under general
supervision special assignments and
tasks; and
(4) Who
do not devote more than 20% of their hours worked in a work-week to activities
which are not directly and
closely related to the performance of the work described in paragraphs (1), (2) and (3) above.
[12] 347 Phil. 122, 136-137 (1997) citing Florenz D. Regalado, Remedial Law Compendium 543-544 (6th ed. 1997).
[13] Art. 82. Coverage.
— The provisions of this Title [Working Conditions and Rest
Periods] shall apply to employees in all
establishments and undertakings whether for profit or not, but not to government employees, managerial
employees, field personnel, members of the family of the employer who are dependent on him for support, domestic
helpers, persons in the personal service of
another, and workers who are paid by results as determined by the Secretary of
Labor in appropriate
regulations.
As used herein,
“managerial employees” refer to those whose primary duty consists of the
management of the establishment in which they are employed or of a department
or subdivision thereof, and to other officers or members of the managerial
staff.
x x x x
[14] Article 100. Prohibition Against Elimination or
Diminution of Benefits. —
Nothing in this Book
[Conditions of Employment] shall be construed to eliminate or in any way
diminish supplements, or other
employee benefits being enjoyed at the time of promulgation of this Code.
[15] Records, pp. 131-138.
[16] See
[17] See Records, pp. 49-86.
[18] San Miguel Brewery Sales Force