GR L 30452; (September, 1982) (Digest)
G.R. No. L-30452 September 30, 1982
MERCURY DRUG CO., INC., petitioner, vs. NARDO DAYAO, ET AL., respondents.
FACTS
The respondents, employees of Mercury Drug Co., Inc., filed a petition before the Court of Industrial Relations (CIR) seeking payment of unpaid back wages for work on Sundays and legal holidays plus 25% additional compensation, payment for night differentials, and other reliefs. The petitioner, Mercury Drug, moved to dismiss the petition, arguing that its drugstore business, as a service enterprise, was excluded from the coverage of the Eight-Hour Labor Law, and that the employees had entered into individual contracts of employment which set annual salaries and expressly waived any extra compensation for work on Sundays, holidays, and at night. The CIR denied the motion to dismiss and, after a hearing on the merits, ordered Mercury Drug to pay the sixty-nine petitioners additional sums equivalent to 25% of their basic salaries for Sunday, holiday, and nighttime work rendered from March 20, 1961, to June 30, 1962. The CIR declared the employment contracts null and void as contrary to law and public policy. Mercury Drug appealed.
ISSUE
The primary issue is whether the individual employment contracts, which provided for annual salaries and included a waiver of extra compensation for work on Sundays, holidays, and at night, are valid and binding upon the employees.
RULING
The Supreme Court affirmed the decision of the CIR. The Court held that the employment contracts were indeed null and void. The legal logic centered on the principle that waivers of benefits mandated by labor laws, especially when exacted from employees in a disadvantaged bargaining position, are contrary to law and public policy. The Court recognized that Mercury Drug’s business required work on Sundays, holidays, and at night as a regular part of employment, not as exceptions. Presented with contracts containing such waivers, the workers had little meaningful choice due to their economic necessity and unequal bargaining power. The Court emphasized the constitutional mandates of social justice and protection to labor, which require vigilant protection of workers’ rights. It rejected the argument that the employees were bound by their “voluntary” commitments, finding such a contention anachronistic. The law’s intent to grant extra compensation for such work cannot be circumvented by private agreement. Therefore, the employees were entitled to the additional 25% compensation as awarded by the CIR.