ATOK-BIG WEDGE MUTUAL BENEFIT ASSOCIATION v.

ATOK-BIG WEDGE MINING COMPANY, INC.

G.R. No. L-7349
July 19, 1955

REYES, J.B.L., J.:

FACTS:

On September 4, 1950, the petitioner labor union, the Atok-Big Wedge Mutual Benefit
Association, submitted to the Atok-Big Wedge Mining Co., Inc. (respondent herein) several
demands, among which was an increase of P0.50 in daily wage.

Some of the demands were granted by petitioner and the others were rejected. Hearings were
held in the Court of Industrial Relations. After the hearing, the respondent court rendered a
decision fixing the minimum wage for the laborers at P3.20 without rice ration and 2.65 a day
with rice ration, declaring that additional compensation representing efficiency bonus should not
be included as part of the wage, and making the award effective from September 4, 1950 (the
date of the presentation of the original demand, instead of from April 5, 1951, the date of the
amended demand). From this decision, the mining company appealed to this Court (G. R. No. L-
5276).

Atok Company asked the Court for authority to stop operations & lay off employees and laborers,
for the reason that due to the heavy losses, increased taxes, high cost of materials, negligible
quantity of ore deports, and the enforcement of the Minimum Wage Law, the continued
operation of the company and the consequent lay-off of hundreds of laborers and employees.

The parties reached an agreement on October 29, 1952 after the SC decision which states
agreement that the following facilities heretofore given or actually being given by petitioner to
its workers and laborers, and which constitute as part of their wages, be valued as follows:

Rice ration P.55 per day

Housing facility .40 per day
All other facilities at least .85 per day

It is understood that the said amount of facilities valued at the above mentioned prices, may be
charged in full or partially by the Company against laborer or employee, as they may see fit
pursuant to the exigencies of its operation.

This was approved by the Court on December 26, 1952.

Later, another case was decided involving the parties giving the employees minimum cash wage
of 3.45 a day with rice ration or 4.00 without rice ration.

ISSUES:

(1) Which of the two decisions would prevail? The agreement or the subsequent decision giving
the employees minimum case wage?, and;
WON the Agreement of October 29, 1952 from the minimum daily wage of P4 would be a waiver
of the minimum wage fixed by the law and hence null and void, since RA 602 sec. 20 provides
that “no agreement or contract, oral or written, to accept a lower wage or less than any other
under this Act, shall be valid”.

(2) WON additional compensation should be paid by the Company to its workers for work
rendered on Sundays and holidays which should be based on the minimum wage of 4.00 and not
on the cash portion which is 2.20. [Currently the company pays additional compensation of 50%
based on the 2.20 wage]

RULING:

(1) The Agreement subsists.

An agreement to deduct certain facilities received by the laborers from their employer is not a
waiver of the minimum wage fixed by the law. Wage 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 (Sec 2 of RA 602).

Thus, the law permits the deduction of such facilities from the laborer’s minimum wage of P4, as
long as their value is “fair and reasonable”.

(2) NO. The Company is correct.

Section 4 of the Commonwealth Act No. 444 (Eight Hour Labor Law) provides:
No person, firm, or corporations... shall compel an employee or laborer to work during Sundays
and holidays, unless he is paid an additional sum of at least 25% of his regular remuneration.
Thus, the Company even pays the laborers higher wage than the minimum. Thus, no law is
violated.

DIFFERENCE BETWEEN A SUPPLEMENT and FACILITY

(1) Supplements, defined – extra remuneration or special privileges or benefits given to or

received by the laborers over and above their ordinary earnings or wages [vacation and holidays
not worked; paid sick leave or maternity leave; overtime rate in excess of what is required by
law; sick, pension, retirement and death benefits; profit sharing; family allowances; Christmas,
war risk and cost of living bonuses or other bonuses other than those paid as a reward for extra
output or time spent on the job].

(2) Facilities, defined – items of expense necessary for laborer’s and his family’s existence and
subsistence, so that by express provision of the law, they form part of the wage and when
furnished by the employer are deductible therefrom since if they are not so furnished, the laborer
would spend and pay for them just the same.

DISPOSITIVE:

Finding no reason to sustain the present petition for review, the same is, therefore, dismissed,
with costs against the petitioner Atok-Big Wedge Mutual Benefit Association.