Maternal vs. Coca-Cola Bottlers Phils., Inc.

A bonus is not a demandable and enforceable obligation unless it is made part of the employee's wage, salary, or compensation or has ripened into a company practice that is consistent and deliberate over a long period; one-time bonuses of varying names, amounts, purposes, and conditions do not ripen into such a practice and may be discontinued without violating Article 100 of the Labor Code.

Coca-Cola Bottlers Phils., Inc. (CCBPI), now known as Coca-Cola Femsa Phils., Inc., is engaged in manufacturing, selling, marketing, and distributing carbonated drinks and other beverages in the Philippines. Its management changed over time: it was under San Miguel Corporation until Coca-Cola Amatil Ltd. of Australia acquired it on July 1, 1997; SMC reacquired it in 2001; and in 2007 SMC transferred management to The Coca-Cola Company after selling 65% of its shares to the latter. During the period 1997 to 2007, CCBPI's regular and permanent employees received bonuses under varying designations and guidelines approved by the managing company.

Coca-Cola Bottlers Phils., Inc. (CCBPI), now known as Coca-Cola Femsa Phils., Inc., was engaged in manufacturing, selling, marketing, and distributing carbonated drinks and other beverages in the Philippines. It was under the management of San Miguel Corporation (SMC) until Coca-Cola Amatil Ltd. of Australia acquired it on July 1, 1997; SMC reacquired it in 2001; and in 2007 SMC transferred management to The Coca-Cola Company after selling 65% of its shares to the latter. Between 1997 and 2007, CCBPI's regular and permanent employees received bonuses in varying amounts under different designations, granted upon approval of the managing company at the time and implemented through guidelines.

The grants were: (a) on November 26, 1997, a One-Time Grant for non-commission and commission-earning monthly and daily paid personnel, computed at 80% of basic salary rate, with variations for sales office in charge, commission-earning personnel, and daily-paid personnel; (b) on July 13, 2001, One-Time Economic Assistance of one-half of basic salary or PHP 40,000, whichever was lower, for all regular CCBPI employees except officers and those holding the position of Assistant Vice President and above; (c) on June 2, 2002, One-Time Economic Assistance of 75% of basic salary or PHP 40,000, whichever was lower, for all employees/personnel whether commission or non-commission based; (d) on November 5, 2002, One-Time Gift of 75% of basic salary for all employees/personnel whether commission or non-commission; (e) on June 27, 2003, One-Time Economic Assistance of PHP 50,000 or 50% of basic salary, whichever was lower, for all regular CCBPI employees except officers and those holding the position of Assistant Vice President and above; (f) on June 25, 2004, One-Time Economic Assistance of PHP 20,000 or one-half of basic salary, whichever was lower, for all Philippine-based regular employees of the San Miguel Group of Companies, which then included CCBPI; (g) on December 2, 2004, One-Time Gift of PHP 5,000 worth of SMC gift certificates and cash amounting to 75% of basic pay for all Philippine-based regular employees of the San Miguel Group; (h) on December 2, 2005, One-Time Christmas Gift of PHP 7,000 worth of SMC gift certificates and cash amounting to 50% of basic pay or PHP 50,000, whichever was smaller, for all Philippine-based regular employees of the San Miguel Group; (i) on November 17, 2006, One-Time Gift of PHP 8,000 worth of SMC gift certificates and cash amounting to 50% of basic pay for all Philippine-based regular employees of the San Miguel Group; and (j) on December 7, 2007, One-Time Economic Assistance of one month pro-rated base pay for all CCBPI associates who were regular in status as of regular employee.

In 2008, the new management of CCBPI stopped granting bonuses other than the 13th month pay and performance-based incentive bonuses. This prompted regular rank-and-file employees and their collective bargaining agent, Sta. Rosa Coca-Cola Plant Employees Union, to file several complaints for nonpayment of bonuses and attorney's fees against CCBPI and its president, Bill Schultz. The complaints were consolidated into two cases docketed as NLRC Case No. SRAB-IV-09-5179-10-L and NLRC Case No. SRAB-IV-09-5156-10-L, which were jointly heard.

The labor arbiter found that the grant of yearly bonuses by CCBPI was uninterrupted and continuous for several years and had become a company practice. The NLRC found no evidence that the grant of bonuses was subject to conditions and concluded that the bonuses formed part of the workers' wages. The CA, however, found that no bonus was granted from 1998 to 2001; that there were instances when two bonuses were given within a year upon management discretion; that economic assistance was not given in 1997 and in 2005 to 2007; that the grants were subject to management approval and implemented through guidelines delineating purpose, computation, and covered employees; and that the amounts varied from year to year and generally trended downward except for the 2007 one-time transition bonus.

• Nature of Bonuses (G.R. No. 218010): Petitioners argued that the bonuses formed part of their wage because these were given voluntarily, consistently, and without any condition.
• Varying Amounts and Names: Petitioners maintained that the varying amount of benefit and the different names given to the bonuses should not be used as grounds to allow employers to unilaterally deny workers the enjoyment of a benefit that had already ripened into a demandable right.
• No Uniformity Requirement: Petitioners argued that uniformity in the name or purpose of the bonus is not a requirement before a bonus can ripen into a demandable right, as the law does not mandate such a requirement.
• Ustaris Minute Resolution: Petitioners invoked the Resolutions dated October 15, 2014 and February 11, 2015 in Coca-Cola Bottlers Philippines, Inc. vs. Mario G. Ustaris et al. (Ustaris), G.R. No. 214149, claiming that the Court had already ruled with finality that the subject bonuses constitute a demandable right of the workers.
• Referral to En Banc: In their Reply, petitioners reiterated their arguments and posited that the case should be elevated to the en banc to establish the rule on the identical claims of CCBPI workers for payment of bonus.
• Final and Executory Decision (G.R. No. 248662): Petitioners argued that their right to a yearly bonus must be upheld; only the computation of the monetary consequences of this right is affected, and this does not violate the principle of immutability of final judgments.
• Execution Stage Modification: Petitioners contended that the April 18, 2011 Decision of the labor arbiter, affirmed in the NLRC's February 29, 2012 Decision and July 25, 2012 Resolution, cannot be modified or nullified at the execution stage by a mere resolution based on a Petition for Certiorari.
• Non-Applicability of Cited Cases: In their Reply, petitioners maintained that SACORU and the other cases cited by CCBPI are not applicable because they do not involve identical facts and issues; the controversy in G.R. No. 248662 is not whether workers are entitled to a yearly bonus but whether the NLRC committed grave abuse of discretion in reversing the Order of the labor arbiter executing a decision already affirmed with finality.
• Survival of Right: Petitioners added that even if the main case is decided in favor of CCBPI, the employees' right to a year-end bonus for 2011 to 2021 remains because it had already been declared final and executory.

• Bonuses Not Demandable: CCBPI maintained that the various grants it gave to the workers remained mere bonuses over which they have no right to demand.
• Finality of Similar Cases: CCBPI argued that the Court had already ruled with finality in similar cases that the so-called annual year-end bonus premised on the previous grant of "one-time" economic assistance, Christmas gift, or transition bonus did not ripen into a company practice and is not a demandable right.
• Prior CA Ruling: In its Comment to the Petition in G.R. No. 248662, CCBPI insisted that the July 25, 2012 Resolution of the NLRC had already been set aside by the CA in its August 19, 2014 Decision in CA-G.R. SP No. 126819, and it is now settled that the employees are not entitled to the year-end bonus.
• Cited Cases: CCBPI highlighted SACORU (G.R. No. 206506), Nido (G.R. No. 214996), Deris (G.R. No. 215681), and Ricardo Briones et al. vs. Coca Cola Bottlers Philippines, Inc. (Briones), G.R. No. 225144, arguing that in those cases it had already been settled that the annual year-end bonus premised on the previous grant of "one-time" economic assistance, Christmas gift, or bonus has not ripened into a company practice and is not a demandable right.

• Binding Effect of Minute Resolutions: Whether this Court is bound by the minute resolutions in G.R. Nos. 206506, 214996, 215681, and 214149.
• Diminution of Benefits: Whether the discontinuation of the bonus in the form of one-time economic assistance, grant, gift, or transition bonus constitutes diminution of benefits proscribed under Article 100 of the Labor Code.
• Final and Executory Entitlement: Whether the entitlement to a year-end bonus of the employees in G.R. No. 248662 had already been declared final and executory and may no longer be reviewed by this Court.
• Grave Abuse of Discretion: Whether the NLRC committed grave abuse of discretion in reversing the Order of the labor arbiter executing a decision that had already been affirmed with finality.

• Binding Effect of Minute Resolutions: No. The Court is not bound by the minute resolutions in G.R. Nos. 206506, 214996, 215681, and 214149. A minute resolution is not binding precedent on non-parties; it has res judicata effect only as to the same parties and subject matter.
• Diminution of Benefits: No. The discontinuation of the one-time economic assistance, grant, gift, or transition bonus does not constitute diminution of benefits under Article 100 of the Labor Code. A bonus is not demandable unless it is part of wage, salary, or compensation or has ripened into a consistent and deliberate company practice.
• Final and Executory Entitlement: No. The entitlement to a year-end bonus in G.R. No. 248662 had not been validly declared final and executory in favor of the workers; the issue became moot and academic because no final and executory decision supported the award.
• Grave Abuse of Discretion: No. The NLRC did not commit grave abuse of discretion in reversing the labor arbiter's execution order. There was no final and executory decision in favor of the workers that could be executed.

• Binding Effect of Minute Resolutions: The Court distinguished a minute resolution from a decision. A minute resolution is signed only by the clerk of court by authority of the justices, does not require the Chief Justice's certification, and is not published in the Philippine Reports. The constitutional requirement that the facts and law on which the judgment is based be clearly and distinctly expressed applies only to decisions, not minute resolutions. Although a minute resolution may dispose of a case on the merits, it is res judicata only as to the same subject matter and issues concerning the same parties; it is not binding precedent on other parties or another subject matter. The workers were not parties to Ustaris, SACORU, Nido, and Deris. Thus, both parties could not invoke the minute resolutions in those cases, and due process and fairness permitted the Court to resolve the present case independently. The CA erred in applying stare decisis because that doctrine presupposes a decision in a previous case settled by the Court; the minute resolutions were bereft of complete statements of facts and the legal justifications applied.
• Diminution of Benefits: Article 100 of the Labor Code prohibits the elimination or diminution of supplements or other employee benefits being enjoyed at the time of the Code's promulgation. The prohibition applies only if the grant or benefit is founded on an express policy or has ripened into a practice over a long period of time which is consistent and deliberate. A bonus is an amount granted and paid to an employee for industry and loyalty, an act of generosity and a management prerogative, and is not a demandable and enforceable obligation except when it is made part of the wage, salary, or compensation. Here, there was no CBA or employment contract granting the benefits; the workers relied on company practice. Practice or custom is not a source of a legally demandable or enforceable right, and the onus lies on the employee to prove the company practice. The CA correctly found that CCBPI's grants did not qualify as a company practice. No bonus was granted from 1998 to 2001; two bonuses were sometimes given within a year upon management discretion; economic assistance was not given in 1997 and 2005 to 2007; and the grants were subject to management approval and guidelines. The workers failed to show that the benefit was given regularly, continuously, and without interruption for a considerable length of time. The bonuses were not unconditionally granted. The amounts varied and generally trended downward except for the 2007 one-time transition bonus. Metrobank and Meralco were not on all fours: in Metrobank, the employer consented through memoranda coinciding with CBAs to grant benefits; in Meralco, the Christmas bonus was consistently given for a considerable length of time, its purpose remained constant, and it was not explicitly temporary, whereas CCBPI's grants varied in name, purpose, scope, and amount and were explicitly "one-time."
• Final and Executory Entitlement: The issues in G.R. No. 248662 were anchored on the premise that the labor arbiter and NLRC awarded bonuses for 2008 to 2010 equivalent to monthly pay multiplied by three or the number of years unpaid. The questions of finality and grave abuse of discretion presupposed a final and executory decision in favor of the workers. However, the bonus did not ripen into a company practice, so the workers were not entitled to it. The Petition in G.R. No. 248662 included parties, majority of whom were also the workers in G.R. No. 218010. The labor arbiter and NLRC decisions in favor of the workers had already been overturned by the CA in CA-G.R. SP No. 137718, whose declarations that the workers were not entitled to the bonus were the result of the CA's power to review decisions of labor tribunals and were affirmed. Thus, there was no monetary award based on a final and executory decision in favor of the workers that could be implemented. As to amounts already executed, Section 18, Rule XI of the 2011 NLRC Rules of Procedure, as amended, governs restitution where the executed judgment is totally or partially reversed or annulled by the CA or Supreme Court with finality and restitution is so ordered.
• Grave Abuse of Discretion: The NLRC did not commit grave abuse of discretion in reversing the labor arbiter's Order. The labor arbiter's November 11, 2013 Order granted execution for bonuses for 2011 and 2012, but the April 18, 2011 Decision covered only bonuses for 2008 to 2010. More fundamentally, because the workers were not entitled to the bonuses, there was no final and executory decision in their favor that could be executed. The CA correctly dismissed the workers' petition in CA-G.R. SP No. 137718.

• Non-Diminution of Benefits (Article 100, Labor Code) — Article 100 prohibits the elimination or diminution of supplements or other employee benefits being enjoyed at the time of the Labor Code's promulgation. The prohibition applies only if the grant or benefit is founded on an express policy or has ripened into a practice over a long period of time which is consistent and deliberate. In this case, the discontinued bonuses were not founded on an express policy or a consistent and deliberate company practice, so their discontinuation did not violate Article 100.
• Bonus as a Non-Demandable Benefit — A bonus is an amount granted and paid to an employee for industry and loyalty, an act of generosity and a management prerogative, and is not a demandable and enforceable obligation except when it is made part of the wage, salary, or compensation. The CCBPI grants were one-time acts of generosity, not part of wages, and did not become demandable.
• Company Practice as a Source of Demandable Right — Practice or custom is not a source of a legally demandable or enforceable right. To invoke the prohibition against diminution of benefits on the ground that a bonus has ripened into a company practice, the employee must clearly establish a company practice favorable to them; the onus lies on the employee. The practice must be regular, continuous, uninterrupted, consistent, and deliberate over a long period, and not subject to management approval or varying conditions. The CCBPI bonuses failed this test.
• Minute Resolution vs. Decision — A minute resolution is not a binding precedent on non-parties. It may dispose of a case on the merits and have res judicata effect as to the same parties and subject matter, but it lacks the complete statement of facts and legal justifications of a decision, is signed only by the clerk of court by authority of the justices, does not require the Chief Justice's certification, and is not published in the Philippine Reports. The minute resolutions in Ustaris, SACORU, Nido, and Deris did not bind the workers who were not parties to those cases.
• Stare Decisis — Stare decisis requires adherence to judicial precedents and presupposes the existence of a decision in a previous case settled by the Court. It does not apply to minute resolutions, which are bereft of complete statements of facts and legal justifications. The CA therefore erred in applying stare decisis based on the minute resolutions in SACORU, Nido, and Deris.
• Restitution of Executed Awards — Under Section 18, Rule XI of the 2011 NLRC Rules of Procedure, as amended, where the executed judgment is totally or partially reversed or annulled by the CA or Supreme Court with finality and restitution is so ordered, the Labor Arbiter shall, on motion, issue an order of restitution of the executed award, except reinstatement wages paid pending appeal. This provision governs amounts already executed in favor of the workers after the award was overturned.

• "A bonus is not a demandable and enforceable obligation, except when it is made part of the wage, salary[,] or compensation of the employee." — This passage, quoted from Producers Bank of the Phils. vs. NLRC, states the controlling rule on when a bonus becomes demandable and anchors the denial of the workers' claim.
• "only if the grant or benefit is founded on an express policy or has ripened into a practice over a long period of time which is consistent and deliberate." — This is the Court's formulation, drawn from Vergara, Jr. vs. Coca-Cola Bottlers Philippines, Inc., of the test for applying the prohibition against diminution of benefits under Article 100.
• "although the Court's dismissal of a case via a minute resolution constitutes a disposition on the merits, the same could not be treated as a binding precedent to cases involving other persons who are not parties to the case, or another subject matter that may or may not have the same parties and issues." — This passage, quoted from Philippine Pizza, Inc. vs. Poras, explains why the minute resolutions in related CCBPI cases did not bind the present petitioners.
• "Where the executed judgment is totally or partially reversed or annulled by the Court of Appeals or the Supreme Court with finality and restitution is so ordered, the Labor Arbiter shall, on motion, issue such order of restitution of the executed award, except reinstatement wages paid pending appeal." — This is Section 18, Rule XI of the 2011 NLRC Rules of Procedure, as amended, which the Court cited to address amounts already executed after the award was overturned.

• Phil. Health Care Providers, Inc. vs. Commissioner of Internal Revenue, 616 Phil. 387 (2009) — Distinguished a minute resolution from a decision and held that a minute resolution is not binding precedent on non-parties; relied on to reject the binding effect of the minute resolutions in related CCBPI cases.
• Philippine Pizza, Inc. vs. Poras, 839 Phil. 381 (2018) — Held that a minute resolution, though a disposition on the merits, is not a binding precedent to cases involving other persons who are not parties or another subject matter; applied to deny stare decisis effect to SACORU, Nido, and Deris.
• Producers Bank of the Phils. vs. NLRC, 407 Phil. 804 (2001) — Defined a bonus as an act of generosity and a management prerogative that is not demandable and enforceable except when made part of wage, salary, or compensation; cited as the foundational rule on bonuses.
• Vergara, Jr. vs. Coca-Cola Bottlers Philippines, Inc., 707 Phil. 255 (2013) — Held that the prohibition against diminution of benefits applies only if the grant or benefit is founded on an express policy or has ripened into a practice over a long period of time which is consistent and deliberate; applied to the CCBPI bonuses.
• Metropolitan Bank and Trust Company vs. NLRC, 607 Phil. 359 (2009) — Distinguished because the employer there consented through memoranda coinciding with collective bargaining agreements to grant benefits, unlike CCBPI where no such memorandum or CBA provision existed.
• MERALCO vs. Sec. Ouisumbing, 361 Phil. 845 (1999) — Distinguished because the Christmas bonus there was consistently given for a considerable length of time with a constant purpose and was not explicitly temporary, while CCBPI's grants varied in name, purpose, scope, and amount and were expressly "one-time."
• Castillo vs. Sandiganbayan, 427 Phil. 785 (2002) — Cited for the definition of stare decisis as the judicial policy requiring adherence to judicial precedents; used to explain why the doctrine did not apply to minute resolutions.
• Home Credit Mutual Building vs. Prudente, G.R. No. 200010, August 27, 2020 — Cited for the rule that the onus lies on the employee to prove a company practice; applied to the workers' failure to establish that the bonuses ripened into a demandable benefit.
• Read-Rite Philippines, Inc. vs. Francisco, 816 Phil. 851 (2017) — Cited in Philippine Pizza, Inc. vs. Poras for the principle that a minute resolution does not necessarily bind non-parties to the action even if it amounts to a final action on a case.

• Article 100, Labor Code of the Philippines — Prohibits the elimination or diminution of supplements or other employee benefits being enjoyed at the time of the Code's promulgation. The Court applied it by holding that the discontinued one-time bonuses were not part of wages and had not ripened into a consistent and deliberate company practice, so their discontinuation was not a prohibited diminution.
• Article II, Section 18, 1987 Constitution — Affirms labor as a primary social economic force and mandates the State to protect the rights of workers and promote their welfare. The Court cited it as part of the constitutional backdrop for labor protection but held that it did not convert the one-time bonuses into demandable benefits.
• Article XIII, Section 3, 1987 Constitution — Requires the State to afford full protection to labor and guarantee workers' rights. The Court cited it together with Article II, Section 18, as constitutional support for labor protection, while still applying the statutory requisites for a demandable bonus.
• Section 18, Rule XI, 2011 NLRC Rules of Procedure, as amended — Governs restitution where an executed judgment is totally or partially reversed or annulled by the CA or Supreme Court with finality and restitution is so ordered. The Court cited it to address the amounts already executed in favor of the workers after the award was overturned.
• Article VIII, Section 14, 1987 Constitution — Requires that the facts and the law on which the judgment is based be expressed clearly and distinctly. The Court noted that this requirement applies only to decisions, not to minute resolutions, in distinguishing the binding effect of the two issuances.
• Article VIII, Section 4(3), 1987 Constitution — Referred to by the Court in distinguishing a decision from a minute resolution, noting that the proviso speaks of a decision. The Court used this to support the conclusion that minute resolutions are not binding precedents.

Inting, Gaerlan, and Kho, Jr., JJ., concurred.

• Leonen, SAJ. — The provided text records only that a separate dissent was filed and does not include its reasoning, so no substantive summary can be made from the source text.