States Marine Corporation and Royal Line Inc.

have a collective bargaining agreement with the Cebu

Seamens Association.
Respondent Union filed with the CIR a petition (Case No. 740-V) against States Marine Corporation, on
September 12, 1952, and was later on amended on May 4, 1953 to include Royal Line, Inc. The
respondent Union alleged that:
1. The officers and men working on board the petitioners vessels have not been paid their sick
leave, vacation and overtime pay;
2. The petitioners threatened or coerced them to accept a reduction of salaries, as observed by
other shipowners;
3. After the Minimum Wage Law had taken effect on August 4, 1951, the petitioners required their
employees on board their vessels to pay the sum of Php 0.40 for every meal while the masters
and officers were not required to pay their meals; and,
4. Captain Carlos Asensi who had refused to yield to the general reduction of salaries was
dismissed by the petitioners. For this reason, Captain Asensi claims for reinstatement and the
payment of backwages from December 25, 1952 at the rate of Php 540.00 per month.
Petitioners contentions are as follows:
1. That very much below 30 of the men and officers in their employ were members of the
respondent Union;
2. That the work on board a vessel is one of comparative case;
3. That petitioners have suffered financial losses in the operation of their vessels and that there is
no law which provides for the payment of sick leave or vacation leave for employees or workers
of private firms;
4. That as regards the claim for overtime pay, the petitioners have always observed the provisions
of CA 444 or the Eight Hour Labor Law notwithstanding the fact that it does not apply to those
who provide means of transportation;
5. That the shipowners and operators in Cebu were paying the salaries of their officers and men
depending upon the margin of profits they could realize and other factors or circumstances of the
business;
6. That in enacting RA 602 or the Minimum Wage Law, the Congress had in mind that the amount of
Php 0.40 per meal, furnished the employees should be deducted from the daily wages; and,
7. That Captain Asensi was not dismissed for alleged union activities, but with the expiration of the
term of the contract between said officer and the petitioners.
The CIR decided in favour of the respondent Union on February 21, 1957. The motion for
reconsideration thereof was likewise denied. Having been denied, the companies filed the writ of
certiorari to resolve the legal questions involved. The following were the assigned errors, totalling to 10:
1. That the CIR erred in holding that it had jurisdiction over the case notwithstanding the fact that
those who had dispute with the petitioners, were less than 30 in number;
2. That the CIR erred in holding, that inasmuch as in the shipping articles, the herein petitioners
have bound themselves to supply the crew with provisions and with such daily subsistence as
shall be mutually agreed upon between the master and the crew, no deductions for meals could
be made by the aforesaid petitioners from their wages or salaries;
3. That the CIR erred in holding that inasmuch as with regards to meals furnished to crew members
of vessel, Section 3(f) of Act No. 602 is the general rule, while Section 19 thereof is the exception,
the cost of said meals may not be legally deducted from the wages or salaries of the aforesaid
crew members by the herein petitioners;
4. That the CIR erred in declaring that the deduction for costs of meals from the wages or salaries
after August 4, 1951, is illegal and same should be reimbursed to the employee concerned, in
spite of said Section 3(f) of Act No. 602;
5. That the CIR erred in holding that Severino Pepito, a boatsman, had rendered overtime work,
notwithstanding the provisions of Section 1 of CA 444; in basing its finding of the alleged
overtime, on the uncorroborated testimony of Pepito; and in ordering the herein petitioners to pay
him;
6. That the CIR erred in ordering petitioners to reinstate Captain Carlos Asensi to his former
position, considering the fact that said officer had been employed since January 9, 1953 as
captain of a vessel belonging to another shipping firm in the City of Cebu; and,
7. That the CIR erred in denying a duly verified motion for new trial, and in overruling petitioners
motion for reconsideration.
Ruling:
The petition is dismissed, with costs against the petitioners.
1. First assigned error: Jurisdiction of the CIR
The CIR found that at the time of the filing of the petition, the respondent Union had more than 30 in
members actually working in the companies, and the court declared itself with jurisdiction to take
cognizance of the case. Against this order, the petitioners did not file a motion for reconsideration or a
petition for certiorari. The finding of fact made by the CIR became final and conclusive, which we are not
now authorized to alter or modify.
More so, at the time of the filing of the petition, the respondent Union had a total members of 159 from
56 members who signed Exhibits A, A-1 to A-8 and 103 members of the Union were listed in Exhibits B,
B-1 to B-35, F-1, and K-1 to K-3.
The fact that only 7 claimed for overtime pay and only 7 witnesses testified, does not warrant the
conclusion that the employees who had some dispute with the present petitioners were less than 30. The
ruling of the CIR, with respect to the question of jurisdiction, is correct.
2. Second, third and fourth assigned errors: Legality of deductions
The deductions are not authorized.
As shown by substantial evidence, that since beginning of the operation of the petitioners business, all
the crew members have been signing shipping articles in which are stated opposite their names, the
salaries or wages they would receive. More so, all seamen, whether members of the crew or deck
officers or engineers, have been furnished free meals by the ship owners of operators.
Under Section 8(b) of the said shipping articles, in consideration of which services to be duly performed,
the said master hereby agrees to pay the said crew, as wages, the sums against their names respectively
expressed in the contract; and to supply them with the provisions as provided here in. Moreover, Section
8(e) of the shipping articles, during the duration of the contract the master of the vessel will provide each
member of the crew such daily subsistence as shall be mutually agreed upon between said master and
crew; or, in lieu of such subsistence the crew may reserve the right to demand at the time of execution of
these articles that adequate daily rations be furnished each member of the crew. From the above
sections of the shipping articles, it is therefore apparent that aside from the payment of the respective
salaries or wages, set opposite the names of the crew members, the petitioners bound themselves to
supply the crew with the ships provisions, daily subsistence, or daily rations which include food. This was
the situation before August 4, 1951 when the Minimum Wage Law became effective.
After the effectivity of the RA 602, the companies began deducting the cost of meals from the wages or
salaries of crew members; but no such deductions were made from the salaries of the deck officers and
engineers in all the boats of the petitioners.
In the coastwise business of transportation of passengers and freight, the men who compose the
complement of a vessel are provided with free meals by the shipowners, operators or agents, because
they hold on to their work and duties, regardless of the stress and strain, concomitant of a bad weather,
unmindful of the dangers that lurk ahead in the midst of the high seas.
Section 3(f) of the Minimum Wage Law provides that:
Until and unless investigations by the Secretary of Labor in his initiative or on petition of any
interested party result in a different determination of the fair and reasonable value, the furnishing
of meals shall be valued at not more than Php 0.30 per meal for agricultural employees and not
more than Php 0.40 for any other employees covered by this Act, and the furnishing of housing
shall be valued at not more than Php 0.20 daily for agricultural workers and not more than Php
0.40 daily for other employees covered by this Act.
Section 19, referring to Relations to other labor laws and practices, of the said law provides that:
Nothing in this Act shall deprive an employee of the right to seek fair wages, shorter working
hours and better working conditions nor justify an employer in violating any other labor law
applicable to his employees, in reducing the wage now paid to any of his employees in excess of
the minimum wage established under this Act, or in reducing supplements furnished on the date
of enactment.
At first blush, it would appear that there exists a contradiction between the provisions of Section 3(f) and
Section 19 of RA 602. But from a careful examination of the same, it is evident that Section 3(f)
constitutes the general rule while Section 19, is the exception. In other words, if there are no
supplements given, within the meaning and contemplation of Section 19, but merely facilities, Section 3(f)
governs. There is no conflict; the two provisions could, as they should be harmonized. And even if there
is such a conflict, the respondent CIR, should resolve the same in favour of the safety and decent living of
the laborers (Article 1702 of the New Civil Code).
Reiterating the ruling of the Atok-Big Wedge Association v. Atok-Big Wedge Corporation, facilities and
supplements are defined as:
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 laborers and his familys existence and
subsistence, so that by the expression provision of law, they form part of the wage and when
furnished by the employer are deductible therefrom, since if they are not 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 wages, it is a facility. The criterion is not so much with the kind of the benefit or item food,
lodging, bonus or sick leave given, but its purpose. Considering, therefore, as definitely found by the
respondent court that the meals were freely given to crew members prior to August 4, 1951, while they
were on the high seas not as part of their wages but as a necessary matter in the maintenance of the
health and efficiency of the crew personnel during the voyage, the deductions therein made for the meals
given after August 4, 1951, should be returned to them, and the operator of the coastwise vessels
affected, should continue giving them the same benefit.
The shipping companies argue that the furnishing of meals before the effectivity of RA 602 is of no
moment, because such circumstance was already taken into consideration by Congress, when it stated
that wage includes the fair and reasonable value of boards customarily furnished by the employer, to the
employees. If we are to follow the theory of the herein petitioners, then a crew member, who used to
receive a monthly wage of Php 100.00 before August 4, 1951, with no deduction for meals, after said
date, would receive only Php 86.00 monthly after deducting the cost of his meals at Php 0.40 per meal,
which would be very much less than the Php 122.00 monthly minimum wage, fixed in accordance with the
Minimum Wage Law. Instead of benefiting him, the law will adversely affect said crew member. Such
interpretation does not conform with the avowed intention of Congress in enacting the said law.
One should not overlook a fact fully established, that only unlicensed crew members were made to pay
for their meals or food, while the deck officers and marine engineers receiving higher pay and provided
with better victuals were not. This picture is in no uncertain terms, a great and unjust discrimination
obtaining in the present case.
3. Fifth, sixth and seventh assigned errors: Severino Pepitos overtime work and non-payment of
such services
Severino Pepito was found by the CIR to have worked overtime and had not been paid for such services.
He had categorically stated that he worked during the late hours of the evening and during the early hours
of the day when the boat docks and unloads. Aside from the above, he did other jobs such as removing
rusts and cleaning the vessel, which overtime work totalled to 6 hours a day and of which h had not been
paid as yet. This statement was not rebutted by the petitioners. Nobody working with him on the same
boat M/V Adriana testified contrariwise. The testimonies of boatswains of other vessels (M/V Irua and
M/V Princesa) are incompetent and unreliable.
Considering the established fact that the work of Pepito was continuous, and during the time he was not
working, he could not leave and could not completely rest, because of the place and nature of his work,
the provisions of Sec. 1 of CA 444, which states that [when] the work is not continuous, the time during
which the laborer is not working and can leave his working place and can rest completely shall not be
counted, find no application in this case.
4. Eight assigned error: Reinstating Captain Carlos Asensi
The Court affirmed the CIRs decision, being in conformity with the evidence, law and equity.
The CIR held that:
Finding that the claims of Captain Carlos Asensi for back salaries from that time of his alleged
layoff on March 20, 1952, were not supported by the evidence on record, the same is hereby
dismissed. Considering, however, that Captain Asensi had been laid-off for a long time and that
his failure to report to work is not sufficient cause for his absolute dismissal, respondents are
hereby ordered to reinstate him to his former job without back salary but under the same terms
and conditions of employment existing prior to his lay-off, without loss of seniority and other
benefits already acquired by him prior to March 20, 1952.
5. Ninth and tenth assigned errors: Denial of its duly verified motion for new trial, and in overruling
petitioners motion for reconsideration
The motion for new trial, supported by an affidavit, states that the movants have a good and valid defense
and the same is based on three orders of the Wage Administration Service (WAS), dated November 6,
1956. It is alleged that they would inevitably affect the defense of the petitioners. The motion for new trial
is without merit. Having the said wage Orders in their possession, while the case was pending decision, it
was not explained why the proper move was not taken to introduce them before the decision was
promulgated. The said wage orders, dealing as they do, with the evaluation of meals and facilities, are
irrelevant to the present issue, it having been found and held that the meals or food in question are not
facilities but supplements. The original petition in the CIR having been filed on September 12, 1952, the
WAS could have intervened in the manner provided by law to express its views on the matter. At any
rate, the admission of the three wage orders could not have altered the decision reached in this case.

AN ACT TO ESTABLISH A MINIMUM WAGE LAW, AND FOR OTHER PURPOSES
(REPEALED BY PRESIDENTIAL DECREE NO. 442)
SECTION 1. Short title of Act. - This Act shall be known as the Minimum Wage Law.
Section 2. Definitions. - As used in this Act -
(a) "Person" means an individual, partnership, association, corporation, business trust, legal
representative, or any organized group of persons.
(b) "Employer" includes any person acting directly or indirectly in the interest of an employer in
relation to an employee and shall include the Government, and the government corporations.
(c) "Employee" includes any individual employed by an employer.
(d) "Agriculture" includes farming in all its branches and among other things includes the
cultivation and tillage of the soil, dairying, the production, cultivation, growing, and harvesting of
any agricultural or horticultural commodities, the raising of livestock or poultry, and any practices
performed by a farmer or on a farm as an incident to or in conjunction with such farming
operations, but does not include the manufacturing or processing of sugar, coconuts, abaca,
tobacco, pineapple or other farm products.
(e) "Industry" means a trade, business, industry or branch thereof, or group of industries, in which
individuals are gainfully employed.
(f) "Employ" includes to suffer or permit to work.
(g) "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, 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 a profit
to the employer or to any person affiliated with the employer which reduces the wage received by
the employee below the minimum wage applicable to the employee under this Act, nor shall any
transaction between an employer or any person affiliated with the employer and the employee of
the employer include any profit to the employer of affiliated person which reduces the employee's
wage below the minimum wage applicable to the employee under this Act.
(h) "Facilities" shall include articles or services of benefit to the employee or his family, but shall
not include 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.
(i) "Hired farm labor" includes the labor of any person employed on a farm, except the labor of the
operator and that of his parents, spouse and children.
(j) "Farm enterprise" comprises all tracts of land, whether contiguous or not, under one
management, located in a province and immediately adjacent provinces, on which any of the
operations enumerated in section two (d) are carried on.
Section 3. Minimum wage. - (a) Every employer shall pay to each of his employees who is employed by
an enterprise other than in agriculture wages at the rate of not less than -
(1) Four pesos a day on the effective date of this Act and thereafter, for employees of an
establishment located in Manila or its environs;
(2) Three pesos a day on the effective date of this Act and for one year after the effective date,
and thereafter P4 a day, for employees of establishments located outside of Manila or its
environs; Provided, That this Act shall not apply to any retail or service enterprise that regularly
employs not more than five employees.
(b) Every employer who operates a farm enterprise comprising more than 12 hectares shall pay to each
of his employees, who is engaged in agriculture, wages at the rate of not less than -
(1) On the effective date of this Act and for one year thereafter, P1.75 a day, and no allowances
for board and lodging shall reduce this wage below P1.50 in cash during that year;
(2) One year after the effective date of this Act, P2 a day, and no allowances for board and
lodging shall reduce this wage below P1.75 in cash; and
(3) One year thereafter, P2.50 a day and no allowances for board and lodging shall reduce this
wage below P2.25 in cash.
(c) Effective on the first of July, nineteen hundred and fifty-two, the minimum wage rates for employees in
the Government service shall be those provided in subsections (a) and (b) of this section.
(d) This Act shall not apply to farm tenancy or to domestic servants.
(e) The crew of vessels of Philippine Registry calling regularly at Manila shall be subject to the minimum
wage for non-agricultural workers in Manila as provided for in this Act.
(f) Until and unless investigations by the Secretary of Labor on his initiative or on petition of any interested
party result in a different determination of the fair and reasonable value, the furnishing of meals shall be
valued at not more than thirty centavos per meal for agricultural employees, and not more than forty
centavos for any other employees covered by this Act, and the furnishing of housing shall be valued at
not more than twenty centavos daily for agricultural workers and not more than forty centavos daily for
other employees covered by this Act.
(g) If in a particular industry a Wage Board appointed by the Secretary of Labor within one year after the
effective date of this Act recommends that a further extension of time before the application of the full
statutory minimum is justified in such industry to avoid undue hardship to the industry, the board may
recommend and the Secretary may approve an extension not to exceed six months and at a minimum
wage not less than the rate provided to take effect on the effective date of this Act.
(h) With respect to piece-work or contract work, on petition of an interested party, the Secretary of Labor
shall use all available devices of investigation to determine whether the work is being compensated in
compliance with this Act, and shall issue findings and orders in connection therewith.
Section 4. Wage investigation: Appointment of Wage Board. - (a) The Secretary of Labor shall have
the power, and it shall be his duty upon petition of six more employees in any industry, to cause an
investigation to be made of the wages being paid to the employees in such industry and their living
conditions, to ascertain if any substantial number of such employees are receiving wages which are less
than sufficient to maintain them in health, efficiency and general well-being. If, after such investigation,
the Secretary of Labor is of the opinion that any substantial number of such employees are receiving such
wages, he shall appoint the Wage Board to fix a minimum wage for such industry.
(b) A minimum wage to be established under this Act shall be as nearly adequate as is economically
feasible to maintain the minimum standard of living necessary for the health, efficiency, and general well-
being of employees. In the determination of a minimum wage, the Secretary of Labor and a Wage Board
shall, among other relevant factors, consider the following:
(1) The cost of living;
(2) The wage established for work of like or comparable character by collective agreements or
arbitration awards;
(3) The wages paid for work of like or comparable character by employers who voluntarily
maintain reasonable standard; and
(4) Fair return of the CAPITAL INVESTED .
(c) The Secretary of Labor shall make rules and regulations governing the appointment of a Wage Board,
its public hearings and mode of procedure, consonant with the requirements of due process of law.
(d) The appointment of Wage Board shall not preclude the Secretary of Labor from subsequently
appointing a new Wage Board for the same industry.
(e) The Secretary may appoint a Wage Board for any industry, whether it is named in section three of this
Act or not.
Section 5. Wage Board; Powers and duties: Recommendations. - (a) A Wage Board appointed under
the provisions of this Act shall be composed of a member representing the public who shall act as
chairman of the Board, two representatives of employees in the industry, and two representatives of the
employers in the same industry. The representatives of the employees and employers shall be selected
from nominations submitted by employees and employers, or organizations thereof, in such industry.
Three members of a Wage Board shall constitute a quorum and its recommendations shall require a vote
of not less than a majority of all its members. The members of a Wage Board shall not be entitled to
compensations except to per diems not exceeding seven pesos for each day of actual attendance and
shall be reimbursed for all necessary travelling expenses incurred in the performance of their duties. The
chairman, if a government employee, shall not be entitled to any per diem.
(b) The Secretary of Labor shall present to a Wage Board all the evidence and information in his
possession relating to the wages in the industry for which the Wage Board was appointed and all other
information which he deems relevant to the establishment of a minimum wage for such industry and shall
cause to be brought before the Board any witness when he deems material. A Wage Board may summon
other witnesses or call upon the Secretary to furnish information to aid in its deliberations.
(c) Within thirty days of its organization, a Wage Board shall submit to the Secretary of Labor its
recommendations as to a minimum wage to be paid by the employers in the industry of for the various
branches of the industry considered.
The Wage Board shall not recommend for any agricultural or non-agricultural industry a minimum wage of
less than the prevailing wage obtaining on the effective date of this Act, and in no case less than the
minimum wage rates set in section three of this Act. These wages may include minimum wages varying
with localities, if in the judgment of the Board conditions make such local differentiation proper and
necessary to effectuate the purpose of this Act and such differentiation does not give an undue
competitive advantage to any locality; and may include terms and conditions relating to part-time
employment and suitable treatment of other cases or classes of cases which, because of the nature and
character of the employment, in the judgment of the Board, justify special treatment, including, in the case
of persons employed as industrial homeworkers, the highest minimum rate which is economically feasible
and which will not result in substantial curtailment of employment opportunities for such employees, and
which shall not less than seventy-five per cent of the minimum wage rates established in section three of
this Act. Home industries covered by this Act shall include apparel, embroidery, other needle trades,
shoes, weaving, basketry, and other handicrafts. The Secretary may add specific home industries to the
coverage of this Act by regulation, when he deems it necessary to further the purposes of this Act. If the
report of the Wage Board is not submitted within thirty days, the Secretary of Labor may appoint a new
Wage Board.
Section 6. Wage orders. - (a) Upon the filing of the Wage Board's report, the Secretary of Labor shall
give notice to interested parties and conduct a public hearing thereon within fifteen days. On the basis of
the Wage Board's report and recommendations and on the basis of the public hearing, the Secretary of
Labor shall, within fifteen days after the termination of the hearing, approve or reject, but shall not modify,
the minimum wages recommended by the Wage Board. If he rejects the minimum wages recommended
by the Wage Board, he shall issue a statement of his reasons therefor, and shall submit the matter to the
same Board shall be convened within fifteen days, and such Board shall submit its report and
recommendations within thirty days after it has been convened, and in case of further disagreement
between the Secretary and the Board, the decision of the Secretary shall prevail. If he approves the
recommendation of the Wage Board, he shall, on the date of approval, issue a wage order prescribing the
minimum wages to be paid to the employees in the industry. Due notice of any hearing provided for in this
section shall be given by publication in such newspapers of general circulation and by such other means
as the Secretary of Labor deems reasonably calculated to give general notice to interested parties. The
procedure at the public hearings before the Secretary shall be consonant with due process of law. The
rules of evidence applied by the courts in proceedings at law shall not strictly apply in any proceeding
conducted by or before a Wage Board.
(b) Orders issued under this section shall define the industry to which they shall apply and may include
such administrative regulations as the Secretary of Labor finds necessary to carry out the purposes of this
Act and of the orders. Except as provided in section nine the rates established by any minimum wage
order shall apply alike to all employees regardless of age or sex.
(c) No such order shall take effect until fifteen days after due notice is given of the issuance thereof by
publication in such newspapers of general circulation and by such other means as the Secretary of Labor
deems reasonably calculated to give to interested parties general notice of such issuance. A certified
copy of each of such order shall be filed in the office of the President of the Philippines.
(d) No employer shall, after the effective date of a minimum wage order, pay an employee who is within
the scope of the wage order, employed by him, wages at less than the amount prescribed in this Act or in
such order, as the case may be.
Section 7. Right of review. - (a) Any person aggrieved by an order of the Secretary of Labor issued
under this Act may obtain a review of such order in the Supreme Court by filing in such Court within
fifteen days after the entry and publication of such order a written petition praying that the order of the
Secretary of Labor be modified or set aside in whole or in part. The review by the Court shall be limited to
questions of law, and findings of fact by the Secretary of Labor when supported by substantial evidence
shall be conclusive. If the petitioner or appellant is an employee, wage earner, farmer, or laborer, he shall
be exempted from filing appeal bond, and docketing fee and he can file typewritten pleadings in all cases.
(b) The commencement of proceedings under subsection (a) shall not, unless specifically ordered by the
Court, operate as a stay of the order unless the person complaining of such order shall file in court an
undertaking with a surety or SURETIES satisfactory to the Court for the payment to the employees
affected by the order, in the event such order is affirmed, of the amount by which the compensation such
employees are entitled to receive under the order exceeds the compensation they actually received while
such stay is in effect.
Section 8. Oaths: Affidavits: Subpoena. - (a) The Secretary of Labor or the Chairman of the Wage
Board shall have the power to administer oaths, to take or cause to be taken the deposition of witnesses
and to require by subpoena the attendance and testimony of witnesses and the production of all books,
records, and other evidence relative to any matter under investigation. In case of failure of any person to
comply with a subpoena lawfully issued under this section or on the refusal of any witness to produce
evidence or to testify to any matter regarding which he may be lawfully interrogated, it shall be the duty of
the proper court of First Instance, upon application of the Secretary of Labor, or the Chairman of the
Wage Board, to compel obedience by proceedings for contempt, as in the case of disobedience of the
requirements of a subpoena issued by such court or a refusal to testify therein. The Secretary of Labor or
the Chairman of the Wage Board shall have the power to certify to official acts.
(b) No person shall be excused from attending and testifying or from producing books, papers,
correspondence, memoranda, contracts, agreements, or other records and documents before the
Secretary of Labor or a Wage Board, or in obedience to the subpoena of the Secretary of Labor or a
Wage Board or in any cause or proceeding instituted under this Act, on the ground that the testimony or
evidence, documentary or otherwise, required of him may tend to incriminate him or subject him to a
penalty for forfeiture; but no individual shall be prosecuted or subjected to any penalty or forfeiture for or
on account of any transaction, matter or thing concerning which he is compelled to testify or produce
evidence, documentary or otherwise, after having claimed his privilege against self-incrimination, except
that such individual so testifying shall not be exempt from prosecution and punishment for perjury
committed in so testifying.
Section 9. Learners or apprentices: Handicapped workers. - The Secretary of Labor and/or any of his
authorized representatives, to the extent necessary to prevent curtailment of opportunities for their
employment, shall, by regulations or by orders provide for (a) the employment of learners or apprentices
under special certificates issued by the Secretary pursuant to such regulations, at wages which in no
case shall be lower than 75 per cent of the applicable minimum, and subject to such limitations as to
period, number, proportion, and length of service, which in no case shall be more than one year, as shall
be prescribed in such certificates, and (b) the employment of individuals whose earning capacity is
impaired by physical or mental deficiency or injury, at such wages, which in no case shall be lower than
50 per cent of the applicable minimum and for such period as shall be fixed in special certificates issued
by the Secretary pursuant to such regulations: Provided, however, That the employment of learners or
apprentices who are students or graduates of authorized nautical schools, in vessels of Philippine
registry, may be permitted without compensation.
Section 10. Direct payment of wages. - (a) Payment in legal tender:
(1) Except as herein otherwise provided, wages payable in money shall be paid in legal tender of
the Philippines, and it shall hereafter be unlawful to pay such wages in the form of PROMISSORY
NOTES , vouchers, coupons, tokens or any other form alleged to represent legal tender;
(a) In accordance with such regulations as the Secretary of Labor may prescribe, the payment of wages
may be made by BANK CHECK or postal check or money order in cases in which payment in such
manner is customary or is necessary because of special circumstances.
(b) Wages, including wages which may be paid retroactively for whatever reason, shall be paid directly to
the employee to whom they are due, except:
(1) In cases where the employee is insured with his consent by the employer, the latter shall be
entitled to deduct form the wage of the employee the amount paid by the employer for premiums
on THE INSURANCE ;
(2) In cases of force majeure rendering such payments impossible; and
(3) In cases where the right of the employees or his union to check-off has been recognized by
the employer or authorized in writing by the individual employees concerned.
(c) An employer may pay the wages of a deceased employee to the heirs of the latter, without the
necessity of intestate proceedings, as hereinafter prescribed. The heirs of a deceased employee, if they
are all of age, shall execute an affidavit attesting to their relationship to the deceased and the fact that
they are his heirs, to the exclusion of all other persons. If any of the heirs is a minor, the affidavit shall be
executed in his behalf by his natural guardian or next of kin. The affidavit shall be presented to the
employer, who make payment through the Secretary of Labor or his representative. The representative of
the Secretary of Labor shall act as referee in dividing the amount paid among the heirs. The payment of
wages under this subsection shall absolve the employer of any further liability with respect to the amount
paid.
(d) No employer shall limit or otherwise interfere with the freedom of any employee to dispose of his
wages.
(e) No employer shall in any manner, force, compel or oblige his employees directly or indirectly to make
use of any store or services operated by such employer or any other person.
(f) No employer shall make any deduction from the wages of his employees, except under authority of
law, or require his employees to make deposits form which deduction shall be made, for the
reimbursement of loss or damage to tools, materials, or equipment supplied by the employer, unless he
shall have first obtained authorization from the Secretary. Such authorization to make deductions from
wages or require deposits for reimbursement for the purpose stated shall be based upon a finding that the
practice of making deductions or requiring deposits is a recognized one in the trade or occupation
concerned; or that it is necessary or desirable in such trade or occupation.
The authorization to make such deductions shall be subject to the following conditions:
(1) That the employer shall inform the employees in the manner prescribed by the Secretary of
Labor of the extent to which and the conditions under which such deductions may be made.
(2) That the employee concerned is clearly shown to be responsible for the loss or damage;
(3) That such employee is given reasonable opportunity to show cause why deduction should not
be made; and
(4) That the amount of such deduction is fair and reasonable and shall not exceed the actual
amount of the loss or damage, and shall be paid at such rate that the amount deducted in any
week shall not exceed twenty per cent of the employee's wages for that week.
(g) It shall be unlawful for any person, including but not restricted to, any employer, supervisor, foreman
or other representative of an employer, employment agent, labor contractor, recruiter, or any officer or
representative of a labor organization, or any officer of the National Government or any provincial, city or
municipal government, or any superintendent, supervisor, foreman, time-keeper, or person in charge in
the service of such government, to make any deductions or withhold any amount from the wages of an
employee or induce any employee to give up any part of the wages to which he is entitled by force,
intimidation, threat or procuring dismissal or in any other manner whatsoever.
(h) Wages shall be paid not less than once every two weeks or twice a month at intervals not exceeding
sixteen days. In the case of employees hired to perform a task, the completion of which requires more
than a fortnight, and in respect of whom intervals for the payment of wages are not otherwise fixed by
collective agreement or arbitration award, it shall be the duty of the employer:
(1) To make payment on account not less often than once every two weeks or twice a month at
intervals not exceeding sixteen days; and
(2) To make a final settlement within two weeks after the completion of the task.
(i) Payment of wages shall be made at or near the place of undertaking, except as otherwise provided by
such rules and regulations as the Secretary of Labor may prescribe.
(j) Employer's responsibility of contractor's PAYROLL :
(1) Whenever an employer shall contract with another person for the performance of the
employer's work, then it shall be the duty of such employer to provide in such contract that the
employees of the contractor and the latter's subcontractor shall be paid according to the
provisions of this Act and in the event that such contractor or subcontractor shall fail to pay wages
to his employee as specified in this Act, such employer shall become civilly liable to the
employees of the contractor or subcontractor to the extent that such work is performed under
such contract, in the same manner as if said employees were directly employed by such
employer.
(2) The provisions of paragraph one of this subsection shall likewise be applicable to any person,
firm, partnership, association or corporation who, not being employer, and hereinafter referred to
as "Indirect Employer", contracts with a contractor for the performance of his work.
(3) In the cases prescribed in paragraphs one and two hereof, the employer or indirect employer
shall have the right to require the contractor to furnish bond in a sum equal to the cost of labor
under the contract, on condition that such contractor shall pay the wages of the employees for the
performance of such contract in accordance with the provisions of this Act.
(k) Notification of wage conditions. - It shall be the duty of every employer to notify his employees at the
time of hiring of the wage conditions under which they are employed, which shall include the following
particulars:
(1) The rate of wages payable;
(2) The method of calculation of wages;
(3) The periodicity of wage payment; the day, hour and place of payment; and
(4) Any change with respect to any of the foregoing items.
(l) This section shall apply to all employees to whom a minimum wage applies under this Act, including
those who are paid wages higher than the applicable minimum.
Section 11. Regulations and orders. - (a) The Secretary of Labor may make, issue, amend and rescind
such regulations and orders as are necessary or appropriate to carry out the provisions of this Act. Such
regulations or orders, and without limiting the generality of the foregoing, may define terms used in this
Act and may include such terms and conditions, including the regulations of industrial home work or such
other acts or practices, as the Secretary of Labor finds necessary or appropriate to carry out the purposes
of the Act or Wage Order issued thereunder and to prevent the circumvention or evasion thereof and to
safeguard the standards therein established, and may provide for the reasonable valuation of board,
lodging or other similar services furnished by an employer to his employees.
(b) Regulations or orders of the Secretary which relate to industrial homework may restrict such work or
may establish piece rates which shall yield to the average employee of an undertaking the minimum wage
applicable to the industrial homeworkers involved.
(c) Regulations or orders of the Secretary of Labor issued pursuant to subsection (a) or (b) of this section,
which relate to industrial homework shall be made only after notice to interested persons and a public
hearing by the Secretary of Labor at which such persons may be heard.
(d) Regulations or orders issued pursuant to this section shall take effect upon publication in such
newspapers of general circulation, and by such other means as the Secretary of Labor deems reasonably
calculated to give to interested persons general notice of such issuance.
(e) Regulations or orders issued pursuant to this section shall be subject to court review, in accordance
with the same procedure as provided in section seven of this Act.
Section 12. Administration and enforcement. - (a) There is hereby created the Wage Administration
Service, in the Department of Labor, under a Chief, who shall be compensated at the rate of seven
thousand two hundred pesos per annum.
(b) The Wage Claims Division of the Bureau of Labor is hereby abolished, and its functions transferred to
the Wage Administration Service, together with the records, and equipments, and unexpected
appropriation of that Division, and such personnel as the Secretary may direct.
(c) The Secretary may, on the recommendation of the Chief of the Wage Administration Service and
subject to civil service laws, appoint such employees as he deems to be necessary to carry out his
functions under this Act, and shall fix the compensation of such employees in accordance with law.
(d) The Secretary may make arrangements for the use of existing national, provincial, or local agencies,
and may utilize such agencies, and such voluntary and uncompensated services, as may regularly or
from time to time be needed in carrying out his functions under this Act.
(e) The Secretary of Labor may delegate any or all of his powers in the administration or enforcement of
this Act to the Chief of the Wage Administration Service, who may act personally or through duly
authorized representatives.
(f) Unless otherwise provided, the Chief of the Wage Administration Service is authorized and it shall be
his duty to enforce the provisions of this Act and the orders and regulations issued thereunder.
(g) Every employer shall keep a printed abstract of the law and a copy of any minimum wage order to
which he may be subjected, conspicuously posted in or about the premises wherein any person subject
thereto is employed. He shall keep in or about the premises wherein any employee is employed a record
of the name, address and occupation of each such employee, of the amount paid each pay period to
each such employee, of the amount paid each pay period or each workweek to each such employee, and
of such other information and for such periods of time as the Secretary of Labor may by regulation or
order prescribe.
(h) The Secretary of Labor or his authorized representatives shall for the purpose of examination have
access to and the right to copy from such record, to question such employee and investigate such fact,
condition, or matter as he may deem necessary or appropriate to determine whether any person has
violated any provision of this Act or any wage order or regulation issued by the Secretary of Labor, or
which may aid in the enforcement of the provisions of this Act and of the wage orders or regulations
issued hereunder.
Section 13. Discrimination. - On and after the effective date of this Act it shall be unlawful for any
person to discharge in any other manner to discriminate against any employee because such employee
has filed any complaint or instituted or caused to be instituted any proceeding under or related to this Act,
or has testified or is about to testify in any such proceeding, or has served or is about to serve on a Wage
Board.
Section 14. False reporting. - On and after the effective date of this Act it shall be unlawful for any
person to make any statement, report, or record filed or kept pursuant to the provisions of this Act or of
any regulation or order thereunder, knowing such statement, report or record to be false in a material
respect.
Section 15. Penalties and recovery of wage due under this Act. - (a) Any person who wilfully violates
any of the provisions of this Act shall upon conviction thereof be subject to a fine of not more than two
thousand pesos, or, upon second conviction, to imprisonment of not more than one year, or to both such
fine and imprisonment, in the discretion of the court.
(b) If any violation of this Act is committed by a corporation, trust, partnership or association, the manager
or in his default, the person acting as such when the violation took place, shall be responsible. In the case
of a government corporation, the managing head shall be made responsible, except when shown that the
violation was due to an act or commission of some other person, over whom he had no control, in which
case the latter shall be held responsible.
(c) The Secretary is authorized to supervise the payment of the unpaid minimum wages or the wages
found owing to any employee under this Act.
(d) The Secretary may bring an action in any competent court to recover the wages owing to an employee
under this Act, with legal interest. Any sum thus recover by the Secretary on behalf of an employee
pursuant to this subsection shall be held in a special deposit account and shall be paid, on order of the
Secretary, directly to the employee or employees affected. Any such sums not paid to an employee
because he cannot be located with a period of three years shall be covered into the Treasury as
miscellaneous receipts.
(e) Any employer who underpays an employee in violation of this Act shall be liable to the employee
affected in the amount of the unpaid wages with legal interest. Action to recover such liability may be
maintained in any competent court by anyone or more employees on behalf of himself or themselves. The
court in such action shall, in addition to any judgment awarded to the plaintiff or plaintiffs, allow a
reasonable attorney's fee which shall not exceed ten per cent of the amount awarded to the plaintiffs,
unless the amount awarded is less than one hundred pesos, in which event the fee may be ten pesos, but
not in excess of the amount. Payment of the amount found due to the plaintiffs shall be made directly to
the plaintiffs, in the presence of a representative of the Secretary of the Court. In the event payment is
witnessed by the court of its representative, the Secretary shall be notified within ten days of payment that
the payment has been made.
(f) No employer, attorney, or any other person, other than the employee to whom under payment are
found due, shall receive any part of the underpayment due the employee; and no attorney shall receive
any fee in excess of the maximum specified herein.
(g) In determining when an action is commenced under this section for the purposes of the statute of
limitation, it shall be considered to be commenced in the case of any individual claimant on the date when
the complaint is filed if he is specifically named as a party plaintiff in the complaint, or if his name did not
so appear, on the subsequent date on which his name is added as a party plaintiff in such action.
Section 16. J urisdiction of the courts. - (a) The Court of First Instance shall have jurisdiction to restrain
violations of this act; action by the Secretary or by the employees affected to recover underpayment may
be brought in any competent Court, which shall render its decision on such cases within fifteen days from
the time the case has been submitted for decision; in appropriate instances, appeal from the decisions of
these courts on any action under this Act shall be in accordance with applicable law.
(b) In the event that a dispute case before the Court of Industrial Relations involves as the sole issue or
as one of the issues a dispute as to minimum wages above the applicable statutory minimum, and the
Secretary of Labor has issued no wage order for the industry or locality applicable to the enterprise, the
Court of Industrial Relations may hear and decide such wage issue: Provided, however, That the
Secretary of Labor shall not undertake to fix the minimum wage for an industry or branch thereof which
involves only a single enterprise or a single employer.
(c) Where the demands of minimum wages involve an actual strike, the matter shall be submitted to the
Secretary of Labor, who shall attempt to secure a settlement between the parties through conciliation.
Should the Secretary fail within fifteen days to effect said settlement, he shall indorse the matter together
with other issues involved, to the Court of Industrial Relations which will acquire jurisdiction on the case
including the minimum wages issue, and after a hearing where the views of the Secretary of Labor will be
given, will decide the case in the same manner as provided in other cases. The decision shall be
rendered by the court in banc within fifteen days after the case has been submitted for determination, and
its finding of facts shall be conclusive if supported by substantial evidence, and shall be subject only to an
appeal by certiorari.
Section 17. Statute of Limitation. - Any action commenced on or after the effective date of this Act
enforce any cause of action under this Act may be commenced within three years after the cause of
action accrued, and every such action shall be forever barred unless commenced within three years after
the cause of action accrued.
Section 18. Protection of the service. - (a) All persons appointed or assigned to work in the
Government in the administration and enforcement of this Act shall be appointed and shall serve under
the Civil Service rules and regulations.
(b) No person engaged in the administration and enforcement of this Act, shall, during his tenure of office,
be an employer, or an officer, representative, or agent of an employer or an employers' association, or of
an association of employees, and no Communist may be appointed to or may hold such office, nor shall
any person engaged in the administration and enforcement of this act as attorney or agent for parties to a
labor dispute, or have any financial interest in such dispute.
(c) Any official of the Government to whom responsibility in administration and enforcement has been
delegated under this Act shall be removable on the sustaining of charges of malfeasance or nonfeasance
in office.
(d) Any person engaged in the administration and enforcement of this Act who is found to have accepted
any bribe from or on behalf of any party in interest under this Act shall be summarily dismissed, and
criminal action shall be instituted against such person.
Section 19. Relations to other labor laws and practices. - Nothing in this Act shall deprive an
employee of the right to seek fair wages, shorter working hours and better working conditions nor justify
an employer in violating any other labor law applicable to his employees, in reducing the wage now paid
to any of his employees in excess of the minimum wage established under this Act, or in reducing
supplements furnished on the date of enactment.
Section 20. Superseding of those provisions or terms of private agreement or contracts that are in
contravention of the requirements of this Act. - No worker or organization of workers may voluntarily
or otherwise, individually or collectively, waive any rights established under this Act, and no agreement or
contract oral or written, to accept a lower wage or less than any other benefit required under this Act shall
be valid.
Section 21. Report by the Secretary. - The Secretary of Labor shall submit annually in January a public
report to the President and Congress covering his activities in the administration and enforcement of this
Act during the preceding year and including such information, data, and recommendations for
amendments or further legislation in connection with matters covered by this Act as he may find
advisable.
Section 22. Appropriation. - The sum of one hundred fifty thousand pesos or so much thereof as may
be necessary is hereby authorized to be appropriated out of the unappropriated funds of the Philippine
Treasury, for salaries, per diems, travelling expenses, purchase of materials and equipment and other
necessary sundry expenses that may be incurred in carrying out the provisions of this Act. The expenses
for succeeding fiscal years shall be provided in the current appropriations for such years.
Section 23. Repeal of inconsistent prior enactment. - Any provisions of law previously enacted on the
subject matter of this Act that is inconsistent with any provisions of this Act is hereby repealed.
Section 24. Separability. - If any provision of this Act or the application of such provision to any person
or circumstance is held invalid, the remainder of the Act and the application of such provision to other
persons or circumstances shall not be affected thereby.
Section 25. Effective date. - This Act shall take effect one hundred twenty days after its enactment,
except that the appointment of personnel and preparations for administration and enforcement may take
effect immediately upon its enactment.
Approved: April 6, 1951