Primary Holding

The Supreme Court ruled that Section 19 of Republic Act No. 602, which prohibits the reduction of wages exceeding the minimum wage, applies to all employers regardless of when they commenced operations.

Background

The petitioner, Automotive Parts & Equipment Company, was incorporated in 1961 and had been paying its employees on both daily and monthly bases. Following the enactment of Republic Act No. 4180 in 1965, which amended the minimum wage law, the Secretary of Labor mandated an increase in monthly wages to a minimum of P180.00. The company contested this requirement, seeking a declaratory relief to interpret its obligations under the law.

Facts

• 1. The petitioner claimed it had raised its monthly salaries to P152.00 in compliance with its interpretation of the law.
• 2. The respondents insisted on a minimum wage of P180.00 based on their interpretation of R.A. No. 4180.
• 3. The petitioner argued that Section 19 of R.A. No. 602 applied only to businesses existing before its enactment.

Arguments of the Petitioners

• 1. The company contended that Section 19's prohibition against wage reduction should not apply to new businesses.
• 2. It argued that since it began operations after the Minimum Wage Law was enacted, it should not be bound by provisions aimed at existing businesses.

Arguments of the Respondents

• 1. The Secretary of Labor and Bureau Director maintained that all employers must adhere to the minimum wage requirements regardless of their establishment date.
• 2. They emphasized that labor laws are designed to protect workers' rights and ensure fair compensation.

Issues

• 1. Whether Automotive Parts & Equipment Company could legally reduce its employees' salaries below the mandated minimum wage set by law.
• 2. Whether Section 19 of R.A. No. 602 applies to newly established businesses concerning minimum wage requirements.

Ruling

• 1. The Supreme Court affirmed the lower court's decision
• 2. The clear legislative intent behind minimum wage laws is to protect labor rights.
• 3. The interpretation sought by the petitioner would undermine this intent and could not be supported by any statutory language.
• 4. The prohibition against reducing wages applies universally to all employers regardless of their date of establishment.

Doctrines

• 1. Social Justice Principle: The Constitution mandates protection for laborers.
• 2. Statutory Construction Favoring Labor: In cases of doubt regarding labor legislation, interpretations should favor workers' rights.

Key Excerpts

• 1. "The construction placed upon the statute by the appellants would lead to an absurdity... It is of the essence of judicial duty to construe statutes so as to avoid such a deplorable result."
• 2. "The fact that the construction placed upon the statute by the appellants would lead to an absurdity is another argument for rejecting it."

Precedents Cited

• 1. Sarcos v. Castillo: Established principles regarding statutory interpretation favoring legislative intent.
• 2. Ty Sue v. Hord: Reinforced that courts should uphold legislative purpose against conflicting interpretations.
• 3. United States v. Toribio: Warned against interpretations that defeat legislative purposes.

Statutory and Constitutional Provisions

• 1. Article II, Section 5: Promotion of social justice.
• 2. Article XIV, Section 6: Protection to labor.
• 3. Republic Act No. 602: Minimum Wage Law.
• 4. Republic Act No. 4180: Amendment raising minimum wage.