Asian Transmission Corporation vs. Court of Appeals

When two regular holidays fall on the same day, daily-paid employees are entitled to 200% of their basic wage for that day, as nothing in Article 94 of the Labor Code authorizes a reduction of the ten statutory paid regular holidays to nine on account of such concurrence.

Asian Transmission Corporation is an employer with a Collective Bargaining Agreement (CBA) with Bisig ng Asian Transmission Labor Union (BATLU). The CBA's Article XIV enumerates ten paid legal holidays that the company shall pay "as required by law," including both Maundy Thursday and Araw ng Kagitingan, without any condition or exception for instances when two holidays fall on the same date. The dispute arose in the context of the Department of Labor and Employment's (DOLE) issuance of an Explanatory Bulletin on March 11, 1993, clarifying holiday pay entitlement when two regular holidays coincide, which bulletin was reproduced on January 23, 1998. Article 94 of the Labor Code, as amended by Executive Order No. 203, enumerates ten regular holidays for which every worker shall be paid his regular daily wage.

Asian Transmission Corporation is an employer party to a Collective Bargaining Agreement (CBA) with the Bisig ng Asian Transmission Labor Union (BATLU). The CBA, specifically Article XIV thereof, enumerates ten paid legal holidays that the company obligates itself to pay "as required by law," including Maundy Thursday, Good Friday, and Araw ng Kagitingan, among others, without any stated condition or exception for instances when two holidays coincide on the same calendar date.

On March 11, 1993, the Department of Labor and Employment, through Undersecretary Cresenciano B. Trajano, issued an Explanatory Bulletin addressing the correct payment of holiday compensation on April 9, 1993, a date on which both Good Friday and Araw ng Kagitingan — both regular holidays — fell on the same day. The bulletin stated that covered employees are entitled to at least 200% of their basic wage even if the holiday is unworked, with the first 100% representing holiday pay for Good Friday and the second 100% representing holiday pay for Araw ng Kagitingan. This bulletin was reproduced on January 23, 1998, when April 9, 1998 again coincided with two regular holidays — Maundy Thursday and Araw ng Kagitingan.

Despite the Explanatory Bulletin, Asian Transmission Corporation opted to pay its daily-paid employees only 100% of their basic pay on April 9, 1998. BATLU protested the payment, and in accordance with Step 6 of the grievance procedure under the CBA, the controversy was submitted for voluntary arbitration.

On July 31, 1998, the Office of the Voluntary Arbitrator rendered a decision directing the company to pay its covered employees 200% — and not just 100% — of their regular daily wages for the unworked April 9, 1998, which covered two regular holidays. The Voluntary Arbitrator held that Article 94 of the Labor Code provides for holiday pay for every regular holiday, and that the enumeration of ten regular holidays should not be interpreted as authorizing a reduction to nine simply because two holidays fall on the same date. The Voluntary Arbitrator's Motion for Reconsideration was denied on September 18, 1998.

The Court of Appeals upheld the Voluntary Arbitrator's ruling, holding that the CBA clearly recognizes the parties' intent to consider Araw ng Kagitingan and Maundy Thursday, on whatever date they may fall, as paid legal holidays, and that there is no condition, qualification, or exception for any variance from the clear intent that all holidays shall be compensated. The Court of Appeals further held that in the absence of an explicit provision in law providing for a reduction of holiday pay when two holidays fall on the same day, any doubt in the interpretation of the Labor Code provisions on holiday pay must be resolved in favor of labor. The Court of Appeals denied the company's Motion for Reconsideration on August 10, 2000; the company received the resolution on August 18, 2000.

On September 15, 2000, the company filed the present petition for certiorari under Rule 65, by which time the 15-day reglementary period to appeal the Court of Appeals decision under Rule 45 had already expired.

• Interpretation of the CBA: Petitioner argued that the Court of Appeals erroneously interpreted the terms of the CBA and substituted its own judgment in place of the agreements made by the parties themselves.
• Validity of the Explanatory Bulletin: Petitioner maintained that the Court of Appeals committed grave abuse of discretion in upholding the validity of the Explanatory Bulletin, even while admitting that the bulletin was not an example of a judicial, quasi-judicial issuance, or one of the rules and regulations that DOLE may promulgate.
• DOLE's Authority to Issue the Bulletin: Petitioner argued that the Secretary of DOLE, by issuing the Explanatory Bulletin in the guise of providing guidelines on Article 94 of the Labor Code, committed grave abuse of discretion by legislating and interpreting legal provisions in a manner that created obligations not intended by law.
• Reiteration of the Bulletin: Petitioner contended that the Court of Appeals committed grave abuse of discretion in sustaining the Secretary of DOLE in reiterating the Explanatory Bulletin and ordering that the same policy obtain for April 9, 1998, despite rulings of the Supreme Court to the contrary, specifically citing Wellington vs. Trajano as having "overruled" the bulletin.
• Due Process and Equal Protection: Petitioner argued that respondents' acts would deprive it of property without due process through the Explanatory Bulletin, as well as deny it equal protection of laws.

• Proper Remedy: Whether the petition for certiorari under Rule 65 was the proper remedy to assail the Court of Appeals' decision, or whether the proper remedy was a petition for review under Rule 45.
• Timeliness: Whether the petition was filed within the reglementary period, given that the Court of Appeals decision had become final and executory.
• Holiday Pay Entitlement: Whether daily-paid employees are entitled to 200% of their basic wage when two regular holidays fall on the same day, or whether the employer may pay only 100%.
• Statutory Construction of Article 94: Whether the enumeration of ten paid regular holidays in Article 94 of the Labor Code, as amended, authorizes a reduction to nine when two holidays coincide on the same date.
• Validity of the Explanatory Bulletin: Whether the DOLE Explanatory Bulletin constituted grave abuse of discretion by creating obligations not intended by law.
• Applicability of Wellington vs. Trajano: Whether Wellington vs. Trajano overruled the DOLE Explanatory Bulletin such that the bulletin could not be applied to April 9, 1998.
• CBA Interpretation: Whether the Court of Appeals erred in interpreting the CBA as requiring payment for all listed holidays without reduction when two fall on the same day.
• Due Process and Equal Protection: Whether the application of the Explanatory Bulletin deprived petitioner of property without due process and equal protection of laws.

• Proper Remedy: No. The proper remedy was a petition for review under Rule 45, not a petition for certiorari under Rule 65, since the Court of Appeals had jurisdiction and any errors it committed were errors of judgment reviewable by timely appeal.
• Timeliness: No. The petition was filed on September 15, 2000, after the 15-day reglementary period under Rule 45 had expired, rendering the Court of Appeals decision final and executory.
• Holiday Pay Entitlement: Yes. Daily-paid employees are entitled to 200% of their basic wage when two regular holidays fall on the same day, as nothing in law authorizes a reduction of the ten statutory paid holidays to nine.
• Statutory Construction of Article 94: No, the enumeration of ten paid regular holidays does not authorize a reduction to nine when two holidays coincide. The law is clear and unequivocal and must be taken to mean exactly what it says.
• Validity of the Explanatory Bulletin: No grave abuse of discretion was found. The bulletin was consistent with the law and the principle that doubts in labor law interpretation shall be resolved in favor of labor.
• Applicability of Wellington vs. Trajano: No. Wellington vs. Trajano did not overrule the Explanatory Bulletin, as it involved a different issue — whether monthly-paid employees are entitled to an additional day's pay when a holiday falls on a Sunday — not whether daily-paid employees are entitled to payment for two holidays falling on the same day.
• CBA Interpretation: No error was committed. The CBA clearly obligates the company to pay for the listed legal holidays "as required by law," without any condition, qualification, or exception for variance when two holidays fall on the same date.
• Due Process and Equal Protection: No violation was found. The petition was devoid of merit on this ground.

• Proper Remedy: The Court of Appeals had jurisdiction over the petition under Rule 65 before it. Any alleged errors committed by the Court of Appeals in the exercise of its jurisdiction were errors of judgment reviewable by timely appeal under Rule 45, not by a special civil action of certiorari. The appeal from a final disposition of the Court of Appeals is a petition for review under Rule 45, which is a continuation of the appellate process over the original case. The reglementary period to appeal is fifteen days from notice of judgment or denial of motion for reconsideration. A remedy is "plain, speedy and adequate" if it will promptly relieve the petitioner from the injurious effects of the judgment. Appeal was available and adequate in this case.

• Timeliness: Petitioner received the Court of Appeals' Resolution denying its Motion for Reconsideration on August 18, 2000, and filed the present petition on September 15, 2000. By that time, the 15-day period to appeal under Rule 45 had expired, and the Court of Appeals decision had become final and executory. A party cannot avail of the writ of certiorari when its predicament is the effect of its own deliberate inaction in failing to appeal within the reglementary period.

• Holiday Pay Entitlement: Holiday pay is a legislated benefit enacted as part of the constitutional imperative that the State shall afford protection to labor. Its purpose is to prevent diminution of the monthly income of workers on account of work interruptions and to enable workers to participate in national celebrations of historical and cultural significance. Article 94 of the Labor Code, as amended by Executive Order No. 203, affords a worker the enjoyment of ten paid regular holidays. The provision is mandatory, regardless of whether an employee is paid on a monthly or daily basis. Unlike a bonus, which is a management prerogative, holiday pay is a statutory benefit demandable under the law. Since a worker is entitled to the enjoyment of ten paid regular holidays, the fact that two holidays fall on the same date should not operate to reduce to nine the ten holiday pay benefits a worker is entitled to receive.

• Statutory Construction of Article 94: Under the rules of statutory construction, when the language of the law is clear and unequivocal, the law must be taken to mean exactly what it says. There is nothing in Article 94 which provides or indicates that the entitlement to ten days of holiday pay shall be reduced to nine when two holidays fall on the same day. Moreover, Article 4 of the Labor Code provides that all doubts in the implementation and interpretation of its provisions, including its implementing rules and regulations, shall be resolved in favor of labor. Section 11, Rule IV, Book III of the Omnibus Rules to Implement the Labor Code further provides that nothing in the law or rules shall justify an employer in withdrawing or reducing any benefits, supplements, or payments for unworked regular holidays as provided in existing individual or collective agreements or employer practice or policy.

• Validity of the Explanatory Bulletin: The Explanatory Bulletin was consistent with the clear language of Article 94 and the principle of resolving doubts in favor of labor. No grave abuse of discretion was committed in issuing or reiterating it, as it merely clarified the correct application of the law to the situation of two holidays falling on the same day.

• Applicability of Wellington vs. Trajano: In Wellington, the issue was whether monthly-paid employees are entitled to an additional day's pay if a holiday falls on a Sunday. The Court answered in the negative, observing that Wellington took into account "every working day of the year including the holidays specified by law and excluding only Sunday" in fixing the monthly salary. In the instant case, the issue is whether daily-paid employees are entitled to be paid for two regular holidays which fall on the same day — a materially different question. Wellington thus did not overrule the Explanatory Bulletin.

• CBA Interpretation: The CBA's Article XIV lists the paid legal holidays the company shall pay "as required by law," including both Maundy Thursday and Araw ng Kagitingan. There is no condition, qualification, or exception for any variance from the clear intent that all holidays shall be compensated. The company had obligated itself to pay for the legal holidays as required by law, and the law requires payment for ten regular holidays without reduction when two coincide.

• Due Process and Equal Protection: The Court found no basis to disturb the assailed decision on these grounds, the petition being devoid of merit both procedurally and substantively.

• Holiday Pay as a Statutory Benefit — Holiday pay is a legislated benefit enacted pursuant to the constitutional imperative that the State shall afford protection to labor. Its purpose is to prevent diminution of workers' income on account of work interruptions and to enable workers to participate in national celebrations of historical and cultural significance. Unlike a bonus, which is a management prerogative, holiday pay is a statutory benefit demandable under law. The entitlement is mandatory regardless of whether the employee is paid on a monthly or daily basis.

• Non-Reduction of Holiday Pay When Two Holidays Coincide — When two regular holidays fall on the same day, the worker is entitled to 200% of the basic wage for that day. Nothing in Article 94 of the Labor Code authorizes a reduction of the ten statutory paid regular holidays to nine on account of such concurrence. The law is clear and unequivocal and must be taken to mean exactly what it says.

• Doubts in Labor Law Resolved in Favor of Labor (Article 4, Labor Code) — All doubts in the implementation and interpretation of the provisions of the Labor Code, including its implementing rules and regulations, shall be resolved in favor of labor, the working man's welfare being the primordial and paramount consideration.

• Proper Remedy from Court of Appeals Decisions — The appeal from a final disposition of the Court of Appeals is a petition for review under Rule 45, not a special civil action of certiorari under Rule 65. Errors committed by the Court of Appeals in the exercise of its jurisdiction are errors of judgment reviewable by timely appeal, not by certiorari. If the aggrieved party fails to appeal within the reglementary period and the decision becomes final and executory, certiorari is unavailable, the predicament being the effect of deliberate inaction.

• "Since a worker is entitled to the enjoyment of ten paid regular holidays, the fact that two holidays fall on the same date should not operate to reduce to nine the ten holiday pay benefits a worker is entitled to receive." — This passage articulates the core ratio decidendi: the concurrence of two regular holidays on the same date does not diminish the worker's statutory entitlement to ten paid holidays.

• "It is elementary, under the rules of statutory construction, that when the language of the law is clear and unequivocal, the law must be taken to mean exactly what it says. In the case at bar, there is nothing in the law which provides or indicates that the entitlement to ten days of holiday pay shall be reduced to nine when two holidays fall on the same day." — This passage applies the plain-meaning rule of statutory construction to Article 94 of the Labor Code, reinforcing that the absence of any reduction provision means no reduction is permitted.

• "[I]n the absence of an explicit provision in law which provides for [a] reduction of holiday pay if two holidays happen to fall on the same day, any doubt in the interpretation and implementation of the Labor Code provisions on holiday pay must be resolved in favor of labor." — This quotation from the Court of Appeals' reasoning, affirmed by the Supreme Court, ties the statutory construction principle to Article 4 of the Labor Code's pro-labor orientation.

• Wellington Investment and Manufacturing Corporation vs. Trajano, G.R. No. 114698, July 3, 1995, 245 SCRA 561 — Distinguished. Wellington involved whether monthly-paid employees are entitled to an additional day's pay when a holiday falls on a Sunday, a materially different issue from whether daily-paid employees are entitled to 200% pay when two regular holidays fall on the same day. The Court held that Wellington did not overrule the DOLE Explanatory Bulletin.

• San Miguel Corporation vs. Court of Appeals, G.R. No. 146775, January 30, 2002, 375 SCRA 311 — Cited for the proposition that when the Court of Appeals has jurisdiction, any errors it commits are errors of judgment reviewable by timely appeal under Rule 45, not by certiorari under Rule 65.

• Insular Bank of Asia and America Employees' Union (IBAAEU) vs. Inciong, G.R. No. L-52415, October 23, 1984, 132 SCRA 663 — Cited for two propositions: (1) that holiday pay under Article 94 is mandatory regardless of whether the employee is paid monthly or daily, and (2) that when the language of the law is clear and unequivocal, it must be taken to mean exactly what it says.

• Abella vs. NLRC, G.R. No. 71812, July 20, 1987, 152 SCRA 140 — Cited in support of Article 4 of the Labor Code, providing that all doubts in the implementation and interpretation of labor law provisions shall be resolved in favor of labor.

• Article 94, Labor Code (Presidential Decree No. 442, as amended) — Provides that every worker shall be paid his regular daily wage during regular holidays, and enumerates the regular holidays. As amended by Executive Order No. 203, the ten regular holidays are: New Year's Day, Maundy Thursday, Good Friday, Araw ng Kagitingan, Labor Day, Independence Day, National Heroes Day, Bonifacio Day, Christmas Day, and Rizal Day. The Court applied this provision to hold that the ten paid holidays are mandatory and not reducible to nine when two coincide.

• Article 4, Labor Code — Provides that all doubts in the implementation and interpretation of the provisions of the Labor Code, including its implementing rules and regulations, shall be resolved in favor of labor. The Court relied on this provision to hold that in the absence of an explicit provision reducing holiday pay when two holidays fall on the same day, any doubt must be resolved in favor of the workers.

• Section 11, Rule IV, Book III, Omnibus Rules to Implement the Labor Code — Provides that nothing in the law or rules shall justify an employer in withdrawing or reducing any benefits, supplements, or payments for unworked regular holidays as provided in existing individual or collective agreements or employer practice or policy. The Court cited this to reinforce the non-reduction principle.

• Article XIII, Section 3, 1987 Constitution — The State shall afford protection to labor. Cited as the constitutional basis for holiday pay as a legislated benefit.

• Rule 45, 1997 Rules of Civil Procedure — Governs petitions for review of Court of Appeals decisions. The Court held this was the proper remedy, not Rule 65 certiorari.

• Rule 65, 1997 Rules of Civil Procedure — Governs special civil actions of certiorari. The Court held this was an improper remedy where appeal under Rule 45 was available and adequate.

Vitug (Chairman), Sandoval-Gutierrez, and Corona, JJ., concurred.