Asia Pacific Chartering, Inc. v. Maria Linda R.

Farolan
GR No. 1511370
Carpio-Morales, J:
FACTS: Petitioner was a general sales agent (GSA) which sold passenger and cargo spaces for airlines
operated by Scandinavian Airline System (an offline international airline company). On December 16,
1992, petitioner hired respondent as Sales Manager for its passenger and cargo operations. In a report
given by respondent sometime in September 1993, she expressed that the company was performing
poorly because of several market forces beyond her control. To remedy the situation, petitioner directed
its high-ranking official, Roberto Zozobrado, to conduct an investigation. As a result, Zozobrado informally
took over some of respondents marketing and sales responsibilities because allegedly the former found
out that the respondent did not adopt any sales strategy to develop other sources of revenue for SAS.
However, respondent presented in evidence a message from Soren Jespersen, the General Manager of
SAS in Hongkong, congratulating the respondent for reaching and exceeding the target by 50% for the
month of May 1994. On June 18, 1994, respondent received a letter of termination from the petitioner on
the ground of loss of trust and confidence. Respondent then filed a case before the Labor Arbiter for
illegal dismissal against petitioner. She further claims that she was not accorded due process and was not
given an opportunity to be heard and answer claims against her. The Labor Arbiter decided the case in
favor of respondent, finding that she was illegally dismissed. On appeal, the NLRC reversed the decision
of LA, stating that it was the right of petitioner to dismiss employees based on loss of trust, which was
management prerogative. The CA reinstated the decision of the LA, finding that the respondent was
deprived of due process.
(1)ISSUE: Whether or not the petitioner was illegally dismissed
HELD: YES. The requisites for a valid dismissal of an employee are: (1) the employee must be afforded
due process (i.e. he must be given the opportunity to be heard and to defend himself) and (2) dismissal
must be for a valid cause as provided in Art. 282 of the Labor Code, or any of the authorized causes
under Art. 283 and 284 of the same. The Court found that respondent was not afforded the opportunity to
be heard and to present evidence in her defense and was not given any notice constituting the grounds
for her dismissal. As regards the second requisite, the employer bears the onus of proving that the
dismissal is for just cause.
(2)ISSUE: Whether or not the doctrine of loss of trust and confidence can be applied to the case at bar
HELD: NO. The Supreme Court did not uphold the petitioners defense in averring the application of the
doctrine of loss of trust as management prerogative. With respect to rank and file personnel, loss of trust
and confidence as a ground for valid dismissal requires proof of involvement in the alleged events in
question and that mere uncorroborated assertions and accusations by the employer will not be sufficient.
But as regards managerial employees, the mere existence of a basis for believing that such employee
has breached the trust of his employer would suffice for his dismissal. The Court determined that
respondent was not a managerial employee (despite the fact that she was designated as a manager)
because it is the job description that determines the nature of the employment. Furthermore, the Court
considered the requisites for an employee to be a managerial employee, which requires the presence of
all of the following: (1) their primary duty consists of the management of the establishment in which they
are employed or a department or a subdivision thereof; (2) they customarily and regularly direct the work
of two or more employees therein; and (3) they have the authority to hire or fire other employees of lower
rank; or their suggestions and recommendations as to the hiring and firing and as to the promotion or any

other change of status of other employees are given particular weight. The Court found that the
respondents function dealt mainly with servicing of existing clientele; hence, she could not be considered
as a managerial employee. As such, her dismissal, to be valid, requires proof that the respondent failed to
observe standards of work or was inefficient. The petitioner was not able to show such evidence. Thus,
the doctrine of loss of trust and confidence cannot be appreciated in favor of the petitioner.

CHARLITO PEARANDA, Petitioner,

vs.
BAGANGA PLYWOOD CORPORATION and HUDSON CHUA, Respondents.
G.R. No. 159577

May 3, 2006

FACTS
Charlito Pearanda was hired as an employee of Baganga Plywood Corporation (BPC) to take
charge of the operations and maintenance of its steam plant boiler. In May 2001, Pearanda filed a
Complaint for illegal dismissal with money claims against BPC and its general manager, Hudson Chua,
before the NLRC.
Pearanda through counsel in his position paper alleges that he was employed by respondent
Baganga Plywood Corporation with a monthly salary of P5,000.00 as Foreman/Boiler Head/Shift Engineer
until he was illegally terminated on December 19, 2000. Further, he alleges that his services were
terminated without the benefit of due process and valid grounds in accordance with law. Furthermore, he
was not paid his overtime pay, premium pay for working during holidays/rest days, night shift differentials
and finally claims for payment of damages and attorneys fees having been forced to litigate the present
complaint.
Respondent alleged that complainants separation from service was done pursuant to Art. 283 of
the Labor Code. The respondent [BPC] was on temporary closure due to repair and general maintenance
and it applied for clearance with the Department of Labor and Employment, Regional Office No. XI to shut
down and to dismiss employees and due to the insistence of herein complainant he was paid his
separation benefits. Consequently, when respondent [BPC] partially reopened in January 2001,
[Pearanda] failed to reapply. Hence, he was not terminated from employment much less illegally. He
opted to severe employment when he insisted payment of his separation benefits. Furthermore, being a
managerial employee he is not entitled to overtime pay and if ever he rendered services beyond
the normal hours of work, [there] was no office order/or authorization for him to do so.
BPC contended that being a managerial employee he is not entitled to overtime pay and if ever he
rendered services beyond the normal hours of work, there was no office order/or authorization for him to
do so. Finally, BPC allege that the claim for damages has no legal and factual basis and that the instant
complaint must necessarily fail for lack of merit."
LABOR ARBITER
The labor arbiter held that Pearanda is a regular, common employee entitled to monetary benefits under
Art. 82 [of the Labor Code].
NLRC

BPC filed an appeal to the NLRC, which deleted the award of overtime pay and premium pay for working
on rest days. According to the Commission, Penaranda was not entitled to these awards because he was
a managerial employee.
CA
CA dismissed Pearandas Petition for Certiorari. The appellate court held that he failed to: 1) attach
copies of the pleadings submitted before the labor arbiter and NLRC; and 2) explain why the filing and
service of the Petition was not done by personal service.
In its later Resolution dated July 4, 2003, the CA denied reconsideration on the ground that petitioner still
failed to submit the pleadings filed before the NLRC.
ISSUE:
Whether or not Penaranda is a regular, common employee entitled to monetary benefits under Art.82.
HELD:
Pearanda claims that he was not a managerial employee, and therefore, entitled to the award granted by
the labor arbiter.
The Court disagrees with the NLRCs finding that petitioner was a managerial employee. However,
petitioner was a member of the managerial staff, which also takes him out of the coverage of labor
standards. Like managerial employees, officers and members of the managerial staff are not entitled to
the provisions of law on labor standards.32 The Implementing Rules of the Labor Code define members of
a managerial staff as those with the following duties and responsibilities:
"(1) The primary duty consists of the performance of work directly related to management policies
of the employer;
"(2) Customarily and regularly exercise discretion and independent judgment;
"(3) (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 percent of their hours worked in a workweek to activities
which are not directly and closely related to the performance of the work described in paragraphs
(1), (2), and (3) above."33
As shift engineer, petitioners duties and responsibilities were as follows:
"1. To supply the required and continuous steam to all consuming units at minimum cost.
"2. To supervise, check and monitor manpower workmanship as well as operation of boiler and
accessories.

"3. To evaluate performance of machinery and manpower.

"4. To follow-up supply of waste and other materials for fuel.
"5. To train new employees for effective and safety while working.
"6. Recommend parts and supplies purchases.
"7. To recommend personnel actions such as: promotion, or disciplinary action.
"8. To check water from the boiler, feedwater and softener, regenerate softener if beyond
hardness limit.
"9. Implement Chemical Dosing.
"10. Perform other task as required by the superior from time to time." 34
The foregoing enumeration, particularly items 1, 2, 3, 5 and 7 illustrates that petitioner was a member of
the managerial staff. His duties and responsibilities conform to the definition of a member of a managerial
staff under the Implementing Rules.
Petitioner supervised the engineering section of the steam plant boiler. His work involved overseeing the
operation of the machines and the performance of the workers in the engineering section. This work
necessarily required the use of discretion and independent judgment to ensure the proper functioning of
the steam plant boiler. As supervisor, petitioner is deemed a member of the managerial staff.
PANGANIBAN, CJ:
Managerial employees and members of the managerial staff are exempted from the provisions of the
Labor Code on labor standards. Since petitioner belongs to this class of employees, he is not entitled to
overtime pay and premium pay for working on rest days.

[G.R. No. 112574. October 8, 1998]

MERCIDAR FISHING CORPORATION represented by its President DOMINGO B. NAVAL, petitioner,
vs. NATIONAL LABOR RELATIONS COMMISSION and FERMIN AGAO, JR., respondents.
Facts:
Private respondent had been employed as a bodegero or ships quartermaster on February 12,
1988.He complained that he had been constructively dismissed by petitioner when the latter refused him
assignments aboard its boats after he had reported to work on May 28, 1990.
Private respondent alleged that he had been sick and thus allowed to go on leave without pay for
one month from April 28, 1990 but that when he reported to work at the end of such period with a health
clearance, he was told to come back another time as he could not be reinstated immediately. Thereafter,

petitioner refused to give him work. For this reason, private respondent asked for a certificate of
employment from petitioner on September 6, 1990. However, when he came back for the certificate on
September 10, petitioner refused to issue the certificate unless he submitted his resignation. Since private
respondent refused to submit such letter unless he was given separation pay, petitioner prevented him
from entering the premises.[2]
Petitioner, on the other hand, alleged that it was private respondent who actually abandoned his
work. It claimed that the latter failed to report for work after his leave had expired and was, in fact, absent
without leave for three months until August 28, 1998. Petitioner further claims that, nonetheless, it
assigned private respondent to another vessel, but the latter was left behind on September 1,
1990. Thereafter, private respondent asked for a certificate of employment on September 6 on the pretext
that he was applying to another fishing company. On September 10, 1990, he refused to get the
certificate and resign unless he was given separation pay.

LABOR ARBITER
Labor Arbiter Arthur L. Amansec rendered a decision ordering respondets to reinstate
complainant with backwages, pay him his 13th month pay and incentive leave pay for 1990. All other
claims are dismissed.

NLRC
dismissed petitioners claim that it cannot be held liable for service incentive leave pay by
fishermen in its employ as the latter supposedly are field personnel and thus not entitled to such pay
under the Labor Code.
ISSUE:
Whether or not Agao (respondent) should be considered as a field personel?

HELD:
The petition has no merit.
Art. 82 of the Labor Code provides:
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, 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.

Field personnel shall refer to non-agricultural employees who regularly perform their duties away
from the principal place of business or branch office of the employer and whose actual hours of work
in the field cannot be determined with reasonable certainty.
Petitioner argues essentially that since the work of private respondent is performed away from its
principal place of business, it has no way of verifying his actual hours of work on the vessel. It contends
that private respondent and other fishermen in its employ should be classified as field personnel who
have no statutory right to service incentive leave pay.
During the entire course of their fishing voyage, fishermen employed by petitioner have no choice but
to remain on board its vessel. Although they perform non-agricultural work away from petitioners business
offices, the fact remains that throughout the duration of their work they are under the effective control and
supervision of petitioner through the vessels patron or master as the NLRC correctly held.

G.R. No. 156367. May 16, 2005

AUTO BUS TRANSPORT SYSTEMS, INC., petitioner, vs. ANTONIO BAUTISTA, respondent.

Facts:
Antonio Bautista has been employed by petitioner Auto Bus Transport Systems, Inc. (Autobus), as
driver-conductor with travel routes Manila-Tuguegarao via Baguio, Baguio- Tuguegarao via Manila and
Manila-Tabuk via Baguio. Respondent was paid on commission basis, seven percent (7%) of the total
gross income per travel, on a twice a month basis.
While Antonio Bautista was driving Autobus No. 114 along Sta. Fe, Nueva Vizcaya, the bus he was
driving accidentally bumped the rear portion of Autobus No. 124, as the latter vehicle suddenly stopped at
a sharp curve without giving any warning.
Antonio Bautista averred that the accident happened because he was compelled by the
management to go back to Roxas, Isabela, although he had not slept for almost twenty-four (24) hours,
as he had just arrived in Manila from Roxas, Isabela. Respondent further alleged that he was not allowed
to work until he fully paid the amount of P75,551.50, representing thirty percent (30%) of the cost of repair
of the damaged buses and that despite respondents pleas for reconsideration, the same was ignored by
management. After a month, management sent him a letter of termination.
Thus, Antonio Bautista instituted a Complaint for Illegal Dismissal with Money Claims for
nonpayment of 13th month pay and service incentive leave pay against Autobus.
Petitioner, on the other hand, maintained that Antonio Bautistas employment was replete with
offenses involving reckless imprudence, gross negligence, and dishonesty. To support its claim, petitioner
presented copies of letters, memos, irregularity reports, and warrants of arrest pertaining to several
incidents wherein respondent was involved.

Furthermore, petitioner avers that in the exercise of its management prerogative, respondents
employment was terminated only after the latter was provided with an opportunity to explain his side
regarding the accident on 03 January 2000.

LABOR ARBITER
Labor Arbiter Monroe C. Tabingan found that the complaint for Illegal Dismissal has no leg to stand on
and thus was, ordered DISMISSED.
However, still based on the above-discussed premises, the respondent must pay to the complainant the
following:
a. his 13th month pay from the date of his hiring to the date of his dismissal, presently
computed at P78,117.87;
b. his service incentive leave pay for all the years he had been in service with the
respondent, presently computed at P13,788.05.
NLRC
[T]he Rules and Regulations Implementing Presidential Decree No. 851, particularly Sec. 3 provides:
Section 3. Employers covered. The Decree shall apply to all employers except to:
e) employers of those who are paid on purely commission, boundary, or task basis, performing a specific
work, irrespective of the time consumed in the performance thereof. xxx.
Records show that complainant, in his position paper, admitted that he was paid on a commission basis.
In view of the foregoing, we deem it just and equitable to modify the assailed Decision by deleting the
award of 13th month pay to the complainant.
CA
Denied petition for lack of merit

ISSUE: Whether or not Respondent Bautista is not entitled to receive Service Incentive Leave by virtue of
Art.95?

HELD:

Article 95 of the Labor Code vis--vis Section 1(D), Rule V, Book III of the Implementing Rules and
Regulations of the Labor Code with respect with the Right to Service Incentive Leave provides:
Art. 95. RIGHT TO SERVICE INCENTIVE LEAVE
(a) Every employee who has rendered at least one year of service shall be entitled to a yearly service
incentive leave of five days with pay.
Book III, Rule V: SERVICE INCENTIVE LEAVE
SECTION 1. Coverage. This rule shall apply to all employees except:
(d) Field personnel and other employees whose performance is unsupervised by the employer including
those who are engaged on task or contract basis, purely commission basis, or those who are paid in a
fixed amount for performing work irrespective of the time consumed in the performance thereof;
It is necessary to stress that the definition of a field personnel is not merely concerned with the
location where the employee regularly performs his duties but also with the fact that the employees
performance is unsupervised by the employer.
The phrase other employees whose performance is unsupervised by the employer must not be
understood as a separate classification of employees to which service incentive leave shall not be
granted. Rather, it serves as an amplification of the interpretation of the definition of field personnel under
the Labor Code as those whose actual hours of work in the field cannot be determined with reasonable
certainty.
As observed by the Labor Arbiter and concurred in by the Court of Appeals:
It is of judicial notice that along the routes that are plied by these bus companies, there are its inspectors
assigned at strategic places who board the bus and inspect the passengers, the punched tickets, and the
conductors reports. There is also the mandatory once-a-week car barn or shop day, where the bus is
regularly checked as to its mechanical, electrical, and hydraulic aspects, whether or not there are
problems thereon as reported by the driver and/or conductor. They too, must be at a specific place and
specified time, as they generally observe prompt departure and arrival from their point of origin to their
point of destination. In each and every depot, there is always the Dispatcher whose function is precisely
to see to it that the bus and its crew leave the premises at specific times and arrive at the estimated
proper time. These, are present in the case at bar. The driver, the complainant herein, was therefore
under constant supervision while in the performance of this work. He cannot be considered a field
personnel.
We agree in the above disquisition. Therefore, as correctly concluded by the appellate court,
respondent is not a field personnel but a regular employee who performs tasks usually necessary and
desirable to the usual trade of petitioners business. Accordingly, respondent is entitled to the grant of
service incentive leave.

Labor Congress vs. NLRC

May 21, 1998, 290 SCRA 509 G.R. No.123938

Philippine airlines Inc. vs. NLRC

G.R. No.132805 Feb. 2, 1999

FACTS
Private respondent Dr. Herminio A. Fabros was employed as flight surgeon by the petitioner
company. He was assigned at the PAL Medical Clinic at Nichols and was on duty from 4:00 in the
afternoon until 12:00 midnight.
On February 17, 1994, at around 7:00 in the evening, private respondent left the clinic to have his
dinner at his residence, which was about five-minute drive away. A few minutes later, the clinic received
an emergency call from the PAL Cargo Services. One of its employees, Mr. Manuel Acosta, had suffered
a heart attack. The nurse on duty, Mr. Merlino Eusebio, called private respondent at home to inform him of
the emergency. The patient arrived at the clinic at 7:50 in the evening and Mr. Eusebio immediately
rushed him to the hospital. When private respondent reached the clinic at around 7:51 in the evening, Mr.
Eusebio had already left with the patient. Mr. Acosta died the following day.
Upon learning about the incident, PAL Medical Director Dr. Godofredo B. Banzon ordered the Chief
Flight Surgeon to conduct an investigation. The Chief Flight Surgeon, in turn, required private respondent
to explain why no disciplinary sanction should be taken against him.
In his explanation, private respondent asserted that he was entitled to a thirty-minute meal break;
that he immediately left his residence upon being informed by Mr. Eusebio about the emergency and he
arrived at the clinic a few minutes later; that Mr. Eusebio panicked and brought the patient to the hospital
without waiting for him.
Finding private respondents explanation unacceptable, the management charged private respondent
with abandonment of post while on duty. He was given ten days to submit a written answer to the
administrative charge.
In his answer, private respondent reiterated the assertions in his previous explanation. He further
denied that he abandoned his post on February 17, 1994. He said that he only left the clinic to have his
dinner at home. In fact, he returned to the clinic at 7:51 in the evening upon being informed of the
emergency.
After evaluating the charge as well as the answer of private respondent, petitioner company decided
to suspend private respondent for three months effective December 16, 1994.
Private respondent was employed as flight surgeon at petitioner company. He was assigned at the
PAL Medical Clinic at Nichols and was on duty from 4:00 in the afternoon until 12:00 midnight.
On February 17, 1994, at around 7:00 in the evening, private respondent left the clinic to have his
dinner at his residence, which was about five-minute drive away. A few minutes later, the clinic received

an emergency call from the PAL Cargo Services. One of its employees, Mr. Manuel Acosta, had suffered
a heart attack. The nurse on duty, Mr. Merlino Eusebio, called private respondent at home to inform him of
the emergency. The patient arrived at the clinic at 7:50 in the evening and Mr. Eusebio immediately
rushed him to the hospital. When private respondent reached the clinic at around 7:51 in the evening, Mr.
Eusebio had already left with the patient. Mr. Acosta died the following day.
Upon learning about the incident, PAL Medical Director Dr. Godofredo B. Banzon ordered the Chief
Flight Surgeon to conduct an investigation. The Chief Flight Surgeon, in turn, required private respondent
to explain why no disciplinary sanction should be taken against him.
In his explanation, private respondent asserted that he was entitled to a thirty-minute meal break;
that he immediately left his residence upon being informed by Mr. Eusebio about the emergency and he
arrived at the clinic a few minutes later; that Mr. Eusebio panicked and brought the patient to the hospital
without waiting for him.
Finding private respondents explanation unacceptable, the management charged private respondent
with abandonment of post while on duty. He was given ten days to submit a written answer to the
administrative charge.
In his answer, private respondent reiterated the assertions in his previous explanation. He further
denied that he abandoned his post on February 17, 1994. He said that he only left the clinic to have his
dinner at home. In fact, he returned to the clinic at 7:51 in the evening upon being informed of the
emergency.
After evaluating the charge as well as the answer of private respondent, petitioner company decided
to suspend private respondent for three months effective December 16, 1994.

LABOR ARBITER
Labor Arbiter Romulus A. Protasio rendered a decision[1] declaring the suspension of private
respondent illegal. It also ordered petitioner to pay private respondent the amount equivalent to all the
benefits he should have received during his period of suspension plus P500,000.00 moral damages.

NLRC
The NLRC dismissed the appeal filed by the petitioner after finding that the decision of the Labor
Arbiter is supported by the facts on record and the law on the matter.

Issue:
Whether or not Respondent has committed an offense that warranted the imposition of disciplinary action.

Held:
The facts do not support petitioners allegation that private respondent abandoned his post on the
evening of February 17, 1994. Private respondent left the clinic that night only to have his dinner at his
house, which was only a few minutes drive away from the clinic. His whereabouts were known to the
nurse on duty so that he could be easily reached in case of emergency. Upon being informed of Mr.
Acostas condition, private respondent immediately left his home and returned to the clinic.These facts
belie petitioners claim of abandonment.
Petitioner argues that being a full-time employee, private respondent is obliged to stay in the
company premises for not less than eight (8) hours. Hence, he may not leave the company premises
during such time, even to take his meals.
We are not impressed.
Articles 83 and 85 of the Labor Code read:
Art. 83. Normal hours of work.The normal hours of work of any employee shall not exceed eight (8)
hours a day.
Health personnel in cities and municipalities with a population of at least one million (1,000,000) or in
hospitals and clinics with a bed capacity of at least one hundred (100) shall hold regular office hours for
eight (8) hours a day, for five (5) days a week, exclusive of time for meals, except where the exigencies
of the service require that such personnel work for six (6) days or forty-eight (48) hours, in which case
they shall be entitled to an additional compensation of at least thirty per cent (30%) of their regular wage
for work on the sixth day. For purposes of this Article, health personnel shall include: resident physicians,
nurses, nutritionists, dieticians, pharmacists, social workers, laboratory technicians, paramedical
technicians, psychologists, midwives, attendants and all other hospital or clinic personnel. (emphasis
supplied)
Art. 85. Meal periods.Subject to such regulations as the Secretary of Labor may prescribe, it shall be the
duty of every employer to give his employees not less than sixty (60) minutes time-off for their regular
meals.
Section 7, Rule I, Book III of the Omnibus Rules Implementing the Labor Code further states:
Sec. 7. Meal and Rest Periods.Every employer shall give his employees, regardless of sex, not less than
one (1) hour time-off for regular meals, except in the following cases when a meal period of not less than
twenty (20) minutes may be given by the employer provided that such shorter meal period is credited as
compensable hours worked of the employee;
(a) Where the work is non-manual work in nature or does not involve strenuous physical exertion;
(b) Where the establishment regularly operates not less than sixteen hours a day;
(c) In cases of actual or impending emergencies or there is urgent work to be performed on machineries,
equipment or installations to avoid serious loss which the employer would otherwise suffer; and

(d) Where the work is necessary to prevent serious loss of perishable goods.
Rest periods or coffee breaks running from five (5) to twenty (20) minutes shall be considered as
compensable working time.
Thus, the eight-hour work period does not include the meal break. Nowhere in the law may it be
inferred that employees must take their meals within the company premises. Employees are not
prohibited from going out of the premises as long as they return to their posts on time. Private
respondents act, therefore, of going home to take his dinner does not constitute abandonment.

Arica vs. NLRC

G.R. No. 78210 February 28, 1989

FACTS:
Teofilo Arica et al and 561 others sued Standard Fruits Corporation (STANFILCO) Philippines for
allegedly not paying the workers for their assembly time which takes place every work day from 5:30am to
6am. The assembly time consists of the roll call of the workers; their getting of assignments from the
foreman; their filling out of the Laborers Daily Accomplishment Report; their getting of tools and
equipments from the stockroom; and their going to the field to work. The workers alleged that this is
necessarily and primarily for STANFILCOs benefit.
Labor Arbiter
The thirty (30)-minute assembly time long practiced and institutionalized by mutual consent of the parties
under Article IV, Section 3, of the Collective Bargaining Agreement cannot be considered as waiting time
within the purview of Section 5, Rule I, Book III of the Rules and Regulations Implementing the Labor
Code
Furthermore, the thirty (30)-minute assembly is a deeply- rooted, routinary practice of the employees, and
the proceedings attendant thereto are not infected with complexities as to deprive the workers the time to
attend to other personal pursuits. They are not new employees as to require the company to deliver long
briefings regarding their respective work assignments. Their houses are situated right on the area where
the farm are located, such that after the roll call, which does not necessarily require the personal
presence, they can go back to their houses to attend to some chores. In short, they are not subject to the
absolute control of the company during this period, otherwise, their failure to report in the assembly time
would justify the company to impose disciplinary measures. The CBA does not contain any provision to
this effect; the record is also bare of any proof on this point. This, therefore, demonstrates the indubitable

fact that the thirty (30)-minute assembly time was not primarily intended for the interests of the employer,
but ultimately for the employees to indicate their availability or non-availability for work during every
working day.
NLRC:
NLRC Affirmed Arbiters Decision
Public respondent NLRC composed of Acting Presiding Commissioner Franklin Drilon, Commissioner
Conrado Maglaya, Commissioner Rosario D. Encarnacion as Members, promulgated its Resolution,
upholding the Labor Arbiters' decision. The Resolution's dispositive portion reads:
'Surely, the customary functions referred to in the above- quoted provision of the
agreement includes the long-standing practice and institutionalized non-compensable
assembly time. This, in effect, estopped complainants from pursuing this case.
The Commission cannot ignore these hard facts, and we are constrained to uphold the
dismissal and closure of the case.
WHEREFORE, let the appeal be, as it is hereby dismissed, for lack of merit.
Given these facts and circumstances, we cannot but agree with respondent that the pronouncement in
that earlier case, i.e. the thirty-minute assembly time long practiced cannot be considered waiting time or
work time and, therefore, not compensable, has become the law of the case which can no longer be
disturbed without doing violence to the time- honored principle of res-judicata.
ISSUE: 1) Whether or not the 30-minute activity of the petitioners before the scheduled working time is
compensable under the Labor Code.

Held:
The court affirmed the rulling of the NLRC and Labor Arbiter by virtue of the time-honored principle of Res
Judicata.
Furthermore, the court held that:
In this connection account should be taken of the cognate principle that res judicata operates to bar not
only the relitigation in a subsequent action of the issues squarely raised, passed upon and adjudicated in
the first suit, but also the ventilation in said subsequent suit of any other issue which could have been
raised in the first but was not. The law provides that 'the judgment or order is, with respect to the matter
directly adjudged or as to any other matter that could have been raised in relation thereto, conclusive
between the parties and their successors in interest by title subsequent to the commencement of the
action .. litigating for the same thing and in the same capacity.' So, even if new causes of action are

asserted in the second action (e.g. fraud, deceit, undue machinations in connection with their execution of
the convenio de transaccion), this would not preclude the operation of the doctrine of res judicata. Those
issues are also barred, even if not passed upon in the first. They could have been, but were not, there
raised

UNIVERSITY OF PANGASINAN FACULTY UNION, Petitioner, v. UNIVERSITY OF PANGASINAN And

NATIONAL LABOR RELATIONS COMMISSION, Respondents.
G.R. No. L-63122 February 20, 1984
FACTS:
University of Pangasinan did not entitle its faculty to ECOLA during the semestral break and when it
increased its tuition fee, it refused its faculty the salary increase 60% of the incremental proceeds of
increased tuition fees.
ISSUES:
WON faculty members of a university are entitled to ECOLA during semestral breaks.
HELD:
Yes.
Per various PDs on ECOLA, ECOLA pay includes LOA withoutpay.The contention that the fact of
receiving a salary should not be the basis of receiving ECOLA is without merit as per IRR of Wage Order
No. 1: Allowance for Unworked days: a) All covered employees whether paid on a monthly or daily basis
shall be entitled to their daily living allowance when they are paid their basic wage.
The intention of the law is to grant ECOLA upon the payment of basic wages. Hence the principle, No
pay, no ECOLA.
Also applied by analogy is the principle enunciated in the ORI-LCP: Sec. 4. Principles in Determining
Hours Worked d) The time during which an employee is inactive by reason of interruptions in his work
beyond his control shall be considered time either if the imminence of the resumption of work requires the
employees presence at the place of work or if the interval is too brief to be utilized effectively and
gainfully in the employees own interest.