GR 145561; (June, 2005) (Digest)
G.R. No. 145561 ; June 15, 2005
HONDA PHILS., INC., petitioner, vs. SAMAHAN NG MALAYANG MANGGAGAWA SA HONDA, respondent.
FACTS
Petitioner Honda Philippines, Inc. and respondent Samahan ng Malayang Manggagawa sa Honda had a Collective Bargaining Agreement (CBA) effective until 2000. The CBA stipulated that the company shall maintain the “present practice” in implementing the 13th month pay, grant a 14th month pay computed on the same basis, and continue the practice of granting financial assistance in December. In 1999, a labor dispute arose, leading to a strike by the union from May 19 to June 16, 1999. Subsequently, Honda issued a memorandum announcing a new pro-rated computation for the 13th and 14th month pay and financial assistance for that year, deducting an amount equivalent to the 31 strike days based on the “no work, no pay” principle. The union opposed this pro-ration.
ISSUE
Whether the pro-rated computation of the 13th month pay, 14th month pay, and financial assistance by Honda is valid under the CBA.
RULING
The Supreme Court denied the petition and upheld the full payment of the benefits. The legal logic centers on the interpretation of the CBA. The Court found the relevant CBA provisions ambiguous, as they did not categorically state whether computation was based on a full month’s basic salary or pro-rated based on actual compensation received. Applying Article 1702 of the Civil Code, which mandates that in case of doubt, labor contracts and legislation shall be construed in favor of the laborer, the ambiguity was resolved against pro-ration.
The Court affirmed the factual findings of the Voluntary Arbitrator and the Court of Appeals, noting that the “present practice” referred to in the CBA pertained to the timing of payment (50% in May and 50% in December), not the method of computation. It emphasized that the 13th month pay, by virtue of Presidential Decree No. 851 and established jurisprudence, is a mandatory benefit based on length of service within a calendar year, not on actual wages earned. The grant of the 14th month pay and financial assistance, having been established as a company practice under the CBA, partakes of the same nature and cannot be unilaterally diminished. To rule otherwise would undermine the purpose of these benefits and could dissuade workers from exercising their constitutional right to strike.