Republic of the
SUPREME COURT
SECOND DIVISION
TSPIC CORPORATION, G.R. No. 163419
Petitioner,
Present:
QUISUMBING,
J., Chairperson,
- versus - CARPIO,
CARPIO
MORALES,
TINGA,
and
VELASCO,
JR., JJ.
TSPIC EMPLOYEES
representing MARIA FE
FE CAPISTRANO, AMY DURIAS,[1]
CLAIRE EVELYN VELEZ, JANICE
OLAGUIR, JERICO ALIPIT, GLEN
BATULA, SER JOHN HERNANDEZ,
RACHEL NOVILLAS, NIMFA ANILAO,
ROSE SUBARDIAGA, VALERIE
CARBON, OLIVIA EDROSO, MARICRIS
DONAIRE, ANALYN AZARCON,
ROSALIE RAMIREZ, JULIETA ROSETE,
JANICE NEBRE, NIA ANDRADE,
CATHERINE YABA, DIOMEDISA
ERNI,[2] MARIO
SALMORIN, LOIDA
COMULLO,[3] MARIE ANN
SUZETTE DULAY,
Respondents. February
13, 2008
x-----------------------------------------------------------------------------------------x
D E C I S I O N
VELASCO, JR., J.:
The path towards industrial peace is
a two-way street. Fundamental fairness and protection to labor should always govern
dealings between labor and management. Seemingly conflicting provisions should
be harmonized to arrive at an interpretation that is within the parameters of
the law, compassionate to labor, yet, fair to management.
In
this Petition for Review on Certiorari under Rule 45, petitioner TSPIC
Corporation (TSPIC) seeks to annul and set aside the October 22, 2003 Decision[5]
and April 23, 2004 Resolution[6] of
the Court of Appeals (CA) in CA-G.R. SP No. 68616, which affirmed the September
13, 2001 Decision[7] of
Accredited Voluntary Arbitrator Josephus B. Jimenez in National Conciliation
and Mediation Board Case No. JBJ-AVA-2001-07-57.
TSPIC
is engaged in the business of designing, manufacturing, and marketing
integrated circuits to serve the communication, automotive, data processing,
and aerospace industries. Respondent TSPIC Employees Union (FFW) (
In
1999, TSPIC and the
Section 1. Salary/ Wage Increases.––Employees covered by this Agreement shall be granted salary/wage increases as follows:
a) Effective January 1, 2000, all employees on regular status and within the bargaining unit on or before said date shall be granted a salary increase equivalent to ten percent (10%) of their basic monthly salary as of December 31, 1999.
b)
Effective
c) Effective January 1, 2002, all employees on regular status and within the bargaining unit on or before said date shall be granted a salary increase equivalent to eleven percent (11%) of their basic monthly salary as of December 31, 2001.
The wage salary increase of the
first year of this Agreement shall be over and above the wage/salary increase,
including the wage distortion adjustment, granted by the COMPANY on
The wage/salary
increases for the years 2001 and 2002 shall be deemed inclusive of the mandated
minimum wage increases under future Wage Orders, that may be issued after Wage
Order No. NCR-07, and shall be considered as correction of any wage distortion
that may have been brought about by the said future Wage Orders. Thus the
wage/salary increases in 2001 and 2002 shall be deemed as compliance to future
wage orders after Wage Order No. NCR-07.
Consequently, on
The CBA also provided that employees
who acquire regular employment status within the year but after the effectivity
of a particular salary increase shall receive a proportionate part of the
increase upon attainment of their regular status. Sec. 2 of the CBA provides:
SECTION 2. Regularization Increase.––A covered daily
paid employee who acquires regular status within the year subsequent to the
effectivity of a particular salary/wage increase mentioned in Section 1 above
shall be granted a salary/wage increase in proportionate basis as follows:
Regularization Period Equivalent
Increase
- 1st Quarter 100%
- 2nd Quarter 75%
- 3rd Quarter 50%
- 4th Quarter 25%
Thus,
a daily paid employee who becomes a regular employee covered by this Agreement
only on May 1, 2000, i.e., during the second quarter and subsequent to the
January 1, 2000 wage increase under this Agreement, will be entitled to a wage
increase equivalent to seventy-five percent (75%) of ten percent (10%) of his
basic pay. In the same manner, an employee who acquires regular status on
On
the other hand, any monthly-paid employee who acquires regular status within
the term of the Agreement shall be granted regularization increase equivalent
to 10% of his regular basic salary.
Then on
On various dates during the last
quarter of 2000, the above named 17 employees attained regular employment[11]
and received 25% of 10% of their salaries as granted under the provision on
regularization increase under Article X,
Sec. 2 of the CBA.
In January 2001, TSPIC implemented
the new wage rates as mandated by the CBA. As a result, the nine employees (first
group), who were senior to the above-listed recently regularized employees,
received less wages.
On January 19, 2001, a few weeks after the salary increase for the year 2001 became effective, TSPIC’s Human Resources Department notified 24 employees,[12] namely: Maria Fe Flores, Janice Olaguir, Rachel Novillas, Fe Capistrano, Jerico Alipit, Amy Durias, Glen Batula, Claire Evelyn Velez, Ser John Hernandez, Nimfa Anilao, Rose Subardiaga, Valerie Carbon, Olivia Edroso, Maricris Donaire, Analyn Azarcon, Rosalie Ramirez, Julieta Rosete, Janice Nebre, Nia Andrade, Catherine Yaba, Diomedisa Erni, Mario Salmorin, Loida Comullo, and Marie Ann Delos Santos, that due to an error in the automated payroll system, they were overpaid and the overpayment would be deducted from their salaries in a staggered basis, starting February 2001. TSPIC explained that the correction of the erroneous computation was based on the crediting provision of Sec. 1, Art. X of the CBA.
The
Consequently, TSPIC and the
On
WHEREFORE,
in the light of the law on the matter and on the facts adduced in evidence,
judgment is hereby rendered in favor of the
1) to the sixteen (16) newly regularized employees named above, the amount of P12,642.24 a month or a total of P113,780.16 for nine (9) months or P7,111.26 for each of them as well as an additional P12,642.24 (for all), or P790.14 (for each), for every month after 30 September 2001, until full payment, with legal interests for every month of delay;
2) to the nine (9) who were hired earlier than the sixteen (16); also named above, their respective amount of entitlements, according to the Union’s correct computation, ranging from P110.22 per month (or P991.98 for nine months) to P450.58 a month (or P4,055.22 for nine months), as well as corresponding monthly entitlements after 30 September 2001, plus legal interests until full payment,
3) to
Suzette Dulay, the amount of P608.14 a month (or P5,473.26), as well as
corresponding monthly entitlements after
4) Attorney’s fees equal to 10% of all the above monetary awards.
The claim for exemplary damages is denied for want of factual basis.
The parties are hereby directed to comply with their joint voluntary commitment to abide by this Award and thus, submit to this Office jointly, a written proof of voluntary compliance with this DECISION within ten (10) days after the finality hereof.
SO ORDERED.[14]
TSPIC
filed a Motion for Reconsideration which was denied in a Resolution dated
Aggrieved, TSPIC filed before the CA a
petition for review under Rule 43 docketed as CA-G.R. SP No. 68616. The
appellate court, through its October 22, 2003 Decision, dismissed the petition
and affirmed in toto the decision of the voluntary arbitrator. The CA
declared TSPIC’s computation allowing PhP
287 as daily wages to the newly regularized employees to be correct, noting
that the computation conformed to WO No. 8 and the provisions of the CBA.
According to the CA, TSPIC failed to convince the appellate court that the
deduction was a result of a system error in the automated payroll system. The
CA explained that when WO No. 8 took effect on
TSPIC
filed a Motion for Reconsideration which was denied by the CA in its
TSPIC
filed the instant petition which raises this sole issue for our resolution: Does
the TSPIC’s decision to deduct the alleged overpayment from the salaries of the
affected members of the
TSPIC
maintains that the formula proposed by the
We
find TSPIC’s contention meritorious.
A Collective Bargaining Agreement is
the law between the parties
It is familiar and fundamental
doctrine in labor law that the CBA is the law between the parties and they are
obliged to comply with its provisions.[16]
We said so in Honda Phils., Inc. v. Samahan ng Malayang Manggagawa sa Honda:
A collective bargaining agreement or CBA refers to the negotiated contract between a legitimate labor organization and the employer concerning wages, hours of work and all other terms and conditions of employment in a bargaining unit. As in all contracts, the parties in a CBA may establish such stipulations, clauses, terms and conditions as they may deem convenient provided these are not contrary to law, morals, good customs, public order or public policy. Thus, where the CBA is clear and unambiguous, it becomes the law between the parties and compliance therewith is mandated by the express policy of the law. [17]
Moreover, if the terms of a contract,
as in a CBA, are clear and leave no doubt upon the intention of the contracting
parties, the literal meaning of their stipulations shall control.[18]
However, sometimes, as in this case, though the provisions of the CBA seem
clear and unambiguous, the parties sometimes arrive at conflicting interpretations.
Here, TSPIC wants to credit the increase granted by WO No. 8 to the increase
granted under the CBA. According to
TSPIC, it is specifically provided in the CBA that “the salary/wage increase
for the year 2001 shall be deemed inclusive of the mandated minimum wage
increases under future wage orders that may be issued after Wage Order No. 7.” The
As a general rule, in the interpretation
of a contract, the intention of the parties is to be pursued.[19] Littera
necat spiritus vivificat. An instrument must be interpreted according to
the intention of the parties. It is the duty of the courts to place a
practical and realistic construction upon it, giving due consideration to the
context in which it is negotiated and the purpose which it is intended to
serve.[20]
Absurd and illogical interpretations should also be avoided. Considering that
the parties have unequivocally agreed to substitute the benefits granted under
the CBA with those granted under wage orders, the agreement must prevail and be
given full effect.
Paragraph
(b) of Sec. 1 of Art. X of the CBA provides for the general agreement that,
effective January 1, 2001, all employees on regular status and within the
bargaining unit on or before said date shall be granted a salary increase
equivalent to twelve (12%) of their basic monthly salary as of December 31,
2000. The 12% salary increase is granted to all employees who (1) are regular
employees and (2) are within the bargaining unit.
Second
paragraph of (c) provides that the salary increase for the year 2000 shall not
include the increase in salary granted under WO No. 7 and the correction of the
wage distortion for November 1999.
The
last paragraph, on the other hand, states the specific condition that the
wage/salary increases for the years 2001 and 2002 shall be deemed inclusive of
the mandated minimum wage increases under future wage orders, that may be
issued after WO No. 7, and shall be considered as correction of the wage
distortions that may be brought about by the said future wage orders. Thus, the wage/salary increases in 2001 and
2002 shall be deemed as compliance to future wage orders after WO No. 7.
Paragraph (b) is a general provision
which allows a salary increase to all those who are qualified. It, however, clashes
with the last paragraph which specifically states that the salary increases for
the years 2001 and 2002 shall be deemed inclusive of wage increases subsequent
to those granted under WO No. 7. It is a familiar rule in interpretation of
contracts that conflicting provisions should be harmonized to give effect to
all.[21]
Likewise, when general and specific provisions are inconsistent, the specific
provision shall be paramount to and govern the general provision.[22]
Thus, it may be reasonably concluded that TSPIC granted the salary increases
under the condition that any wage order that may be subsequently issued shall
be credited against the previously granted increase. The intention of the parties
is clear: As long as an employee is qualified to receive the 12% increase in
salary, the employee shall be granted the increase; and as long as an employee
is granted the 12% increase, the amount shall be credited against any wage
order issued after WO No. 7.
Respondents
should not be allowed to receive benefits from the CBA while avoiding the
counterpart crediting provision. They have received their regularization
increases under Art. X, Sec. 2 of the CBA and the yearly increase for the year
2001. They should not then be allowed to avoid the crediting provision which is
an accompanying condition.
Respondents attained regular
employment status before January 1, 2001. WO No. 8, increasing the minimum wage,
was issued after WO No. 7. Thus, respondents rightfully received the 12% salary
increase for the year 2001 granted in the CBA; and consequently, TSPIC
rightfully credited that 12% increase against the increase granted by WO No. 8.
Proper formula for computing the
salaries for the year 2001
Thus, the proper computation of the
salaries of individual respondents is as
follows:
(1) With regard to the first group of
respondents who attained regular employment status before the effectivity of WO
No. 8, the computation is as follows:
For respondents Jerico Alipit and
Glen Batula:[23]
Wage rate before WO No. 8………………... PhP 234.67
Increase due to WO No. 8
setting the minimum wage at PhP 250.……… 15.33
Total Salary upon effectivity of WO No. 8…. PhP 250.00
Increase for 2001 (12% of 2000 salary)……........... PhP
30.00
Less the wage increase under WO No. 8…………. 15.33
Total difference between the wage
increase
for 2001 and the increase granted under WO No. 8.. PhP 14.67
Wage rate by December 2000…………………………..... PhP 250.00
Plus total difference between the wage increase for
2001
and the increase granted under WO No. 8……………….. 14.67
Total (Wage rate range
beginning
For
respondents Ser John Hernandez and Rachel Novillas:[24]
Wage rate range before WO No. 8………….PhP 234.68
Increase due to WO No. 8
setting the minimum wage at PhP 250…….. 15.32
Total Salary upon effectivity of WO No. 8... PhP 250.00
Increase for 2001 (12% of 2000 salary)……………… PhP 30.00
Less the wage increase under WO No. 8…………….. 15.32
Total difference between the wage
increase
for 2001 and the increase granted
under WO No. 8…. PhP 14.68
Wage rate by December 2000………………………......... PhP 250.00
Plus total difference between the wage increase for
2001
and the increase granted under WO No. 8……………….. 14.68
Total (Wage rate range beginning
For respondents Amy Durias, Claire
Evelyn Velez, and Janice Olaguir:[25]
Wage rate range before WO No. 8………….. PhP 240.26
Increase due to WO No. 8
setting the minimum wage at PhP 250……… 9.74
Total Salary upon effectivity of WO No. 8…. PhP 250.00
Increase for 2001 (12% of 2000 salary)………………. PhP 30.00
Less the wage increase under WO No. 8……………… 9.74
Total difference between the wage
increase for 2001
and the increase granted under WO No.
8…………….. PhP 20.26
Wage rate by December 2000……………………………. PhP 250.00
Plus total difference between the wage increase for
2001
and the increase granted under WO No. 8……………….. 20.26
Total (Wage rate range beginning
For respondents Ma. Fe Flores and Fe
Capistrano:[26]
Wage rate range before WO No. 8…………… PhP 245.85
Increase due to WO No. 8
setting the minimum wage at PhP 250……….. 4.15
Total Salary upon effectivity of WO No. 8…... PhP 250.00
Increase for 2001 (12% of 2000 salary)………………. PhP 30.00
Less the wage increase under WO No. 8………........... 4.15
Total difference between the wage
increase for 2001
and the increase granted under WO No. 8…………….
PhP 25.85
Wage rate by December 2000……………………………. PhP 250.00
Plus total difference between the wage increase for
2001
and the increase granted under WO No. 8……………….. 25.85
Total (Wage rate range beginning
(2) With regard to the second group
of employees, who attained regular employment status after the implementation
of WO No. 8, namely: Nimfa Anilao, Rose Subardiaga, Valerie Carbon, Olivia
Edroso, Maricris Donaire, Analyn Azarcon, Rosalie Ramirez, Julieta Rosete,
Janice Nebre, Nia Andrade, Catherine Yaba, Diomedisa Erni, Mario Salmorin,
Loida Comullo, Marie Ann Delos Santos, Juanita Yana, and Suzette Dulay, the
proper computation of the salaries for the year 2001, in accordance with the
CBA, is as follows:
Compute
the increase in salary after the implementation of WO No. 8 by subtracting the
minimum wage before WO No. 8 from the minimum wage per the wage order to arrive
at the wage increase, thus:
Minimum Wage per Wage Order………….. PhP 250.00
Wage rate before Wage Order…………….. 223.50
Wage Increase………………………………. PhP 26.50
Upon attainment of regular employment
status, the employees’ salaries were increased by 25% of 10% of their basic
salaries, as provided for in Sec. 2, Art. X of the CBA, thus resulting in a
further increase of PhP 6.25, for a total of PhP 256.25, computed as follows:
Wage rate after WO No. 8………………………………. PhP 250.00
Regularization increase (25 % of 10% of basic salary)….
6.25
Total (Salary for the end of year
2000)………………….. PhP 256.25
To compute for the increase in wage
rates for the year 2001, get the increase of 12% of the employees’ salaries as
of December 31, 2000; then subtract from that amount, the amount increased in
salaries as granted under WO No. 8 in accordance with the crediting provision
of the CBA, to arrive at the increase in salaries for the year 2001 of the
recently regularized employees. Add the result to their salaries as of
Increase for 2001 (12% of 2000 salary)………………... PhP 30.75
Less the wage increase under WO No. 8………………. 26.50
Difference between the wage increase
for 2001 and the increase granted under
WO No. 8…….... PhP 4.25
Wage rate after regularization increase………………... PhP 256.25
Plus total difference between the wage increase and
the increase granted under WO No. 8…………………. 4.25
Total (Wage
rate beginning
With
these computations, the crediting provision of the CBA is put in effect, and the
wage distortion between the first and second group of employees is cured. The first
group of employees who attained regular employment status before the
implementation of WO No. 8 is entitled to receive, starting January 1, 2001, a daily wage rate within the range of PhP 264.67 to PhP 275.85, depending on
their wage rate before the implementation of WO No. 8. The second group that attained
regular employment status after the implementation of WO No. 8 is entitled to
receive a daily wage rate of PhP 260.50 starting
Diminution of benefits
TSPIC also maintains that charging
the overpayments made to the 16 respondents through staggered deductions from
their salaries does not constitute diminution of benefits.
We
agree with TSPIC.
Diminution of benefits is the unilateral
withdrawal by the employer of benefits already enjoyed by the employees. There
is diminution of benefits when it is shown that: (1) the grant or benefit is
founded on a policy or has ripened into a practice over a long period; (2) the
practice is consistent and deliberate; (3) the practice is not due to error in
the construction or application of a doubtful or difficult question of law; and
(4) the diminution or discontinuance is done unilaterally by the employer.[27]
As
correctly pointed out by TSPIC, the overpayment of its employees was a result
of an error. This error was immediately rectified by TSPIC upon its discovery.
We have ruled before that an erroneously granted benefit may be withdrawn
without violating the prohibition against non-diminution of benefits. We ruled in
Globe-Mackay Cable and Radio Corp. v. NLRC:
Absent clear administrative guidelines, Petitioner Corporation cannot be faulted for erroneous application of the law. Payment may be said to have been made by reason of a mistake in the construction or application of a “doubtful or difficult question of law”. (Article 2155, in relation to Article 2154 of the Civil Code). Since it is a past error that is being corrected, no vested right may be said to have arisen nor any diminution of benefit under Article 100 of the Labor Code may be said to have resulted by virtue of the correction.[28]
Here, no vested right accrued to individual
respondents when TSPIC corrected its error by crediting the salary increase for
the year 2001 against the salary increase granted under WO No. 8, all in
accordance with the CBA.
Hence, any amount given to the
employees in excess of what they were entitled to, as computed above, may be
legally deducted by TSPIC from the employees’ salaries. It was also compassionate and fair that TSPIC
deducted the overpayment in installments over a period of 12 months starting
from the date of the initial deduction to lessen the burden on the overpaid
employees. TSPIC, in turn, must refund to
individual respondents any amount
deducted from their salaries which was in excess of what TSPIC is legally
allowed to deduct from the salaries based on the computations discussed in this
Decision.
As a last word, it should be
reiterated that though it is the state’s responsibility to afford protection to
labor, this policy should not be used as an instrument to oppress management
and capital.[29] In
resolving disputes between labor and capital, fairness and justice should
always prevail. We ruled in Norkis
WHEREFORE,
premises considered, the
|
Name of Employee |
Daily Wage Rate |
No. of Working
Days in a Month |
No. of Months in
a Year |
Total Salary for
2001 |
|
Nimfa Anilao |
260.5 |
26 |
12 |
81,276.00 |
|
Rose Subardiaga |
260.5 |
26 |
12 |
81,276.00 |
|
Valerie Carbon |
260.5 |
26 |
12 |
81,276.00 |
|
Olivia Edroso |
260.5 |
26 |
12 |
81,276.00 |
|
Maricris Donaire |
260.5 |
26 |
12 |
81,276.00 |
|
Analyn Azarcon |
260.5 |
26 |
12 |
81,276.00 |
|
Rosalie Ramirez |
260.5 |
26 |
12 |
81,276.00 |
|
Julieta Rosete |
260.5 |
26 |
12 |
81,276.00 |
|
Janice Nebre |
260.5 |
26 |
12 |
81,276.00 |
|
Nia Andrade |
260.5 |
26 |
12 |
81,276.00 |
|
Catherine Yaba |
260.5 |
26 |
12 |
81,276.00 |
|
Diomedisa Erni |
260.5 |
26 |
12 |
81,276.00 |
|
Mario Salmorin |
260.5 |
26 |
12 |
81,276.00 |
|
Loida Camullo |
260.5 |
26 |
12 |
81,276.00 |
|
Marie Ann Delos |
260.5 |
26 |
12 |
81,276.00 |
|
Juanita Yana |
260.5 |
26 |
12 |
81,276.00 |
|
Suzette Dulay |
260.5 |
26 |
12 |
81,276.00 |
|
Jerico Alipit |
264.67 |
26 |
12 |
82,577.04 |
|
Glen Batula |
264.67 |
26 |
12 |
82,577.04 |
|
Ser John Hernandez |
264.68 |
26 |
12 |
82,580.16 |
|
Rachel Novillas |
264.68 |
26 |
12 |
82,580.16 |
|
Amy Durias |
270.26 |
26 |
12 |
84,321.12 |
|
Claire Evelyn Velez |
270.26 |
26 |
12 |
84,321.12 |
|
Janice Olaguir |
270.26 |
26 |
12 |
84,321.12 |
|
Maria Fe |
275.85 |
26 |
12 |
86,065.20 |
|
Fe Capistrano |
275.85 |
26 |
12 |
86,065.20 |
The award
for attorney’s fees of ten percent (10%) of the total award is MAINTAINED.
SO ORDERED.
PRESBITERO J. VELASCO, JR.
Associate Justice
WE
CONCUR:
Associate Justice
Chairperson
ANTONIO T. CARPIO CONCHITA
CARPIO MORALES
Associate Justice Associate Justice
Associate Justice
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.
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
Chief Justice
[1] Also appears as Amie Durias in some parts of the records.
[2] Also appears as Deomedisa Erne in some parts of the records.
[3] Also appears as Loida Camullo in some parts of the records.
[4]
Also appears as Mary Ann delos
[5] Rollo, pp. 31-39-A. Penned by Associate Justice Conrado M. Vasquez, Jr., and concurred in by Associate Justices Bienvenido L. Reyes and Arsenio J. Magpale.
[6]
[7]
[8]
[9]
[10]
“Providing an Increase in the Daily Minimum Wage in the National Capital Region,
and Its Implementing Rules: Rules Implementing Wage Order No. NCR-08,” approved
on
[11] Rollo, p. 32.
[12]
[13] Art. 100. Prohibition against elimination or diminution of benefits. Nothing in this Book 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.
[14] Rollo, pp. 131-132.
[15]
[16] Centro Escolar University Faculty and Allied Workers Union-Independent v. Court of Appeals, G.R. No. 165486, May 31, 2006, 490 SCRA 61, 72.
[17]
G.R. No. 145561,
[18] Civil Code, Art. 1370.
[19] See Rules of Court, Rule 130, Sec. 11.
[20] Marcopper Mining Corporation v. NLRC, G.R. No. 103525, March 29, 1996, 255 SCRA 322, 333; citing Davao Integrated Port Stevedoring Services v. Abarquez, G.R. No. 102132, March 19, 1993, 220 SCRA 197.
[21] Civil Code, Art. 1374; Rules of Court, Rule 130, Sec. 11.
[22] See Rules of Court, Rule 130, Sec. 12.
[23] Rollo, p. 537. It appears from the
records that they attained regular employment status on
[24]
[25]
[26]
[27]
[28] No. L-74156, June 29, 1988, 163 SCRA 71, 78.
[29] Agabon
v. NLRC, G.R. No. 158693,
[30]
G.R. No. 157098,