G.R. No. L-41539. May 25, 1977.
Guadalupe J. Vda. De Ucang, et al. vs. Workmen’s Compensation Commission and Philippine Packing Corporation.

FACTS

Saturnino Ucang worked as a field laborer for Philippine Packing Corporation from 1950 until his death in 1971. His duties involved strenuous manual labor. On November 4, 1971, he commenced an approved vacation leave with pay. While on this leave on November 6, 1971, he suffered a fatal heart attack. His widow and children filed a claim for death benefits under the Workmen’s Compensation Act. The Regional Office granted the claim, ruling that the presumption of compensability applied, given the nature of his work and length of service, and that the employer failed to rebut this presumption.
On review, the Workmen’s Compensation Commission reversed the award. The Commission held that the employer-employee relationship was suspended during Ucang’s vacation leave, as he was not performing work for the employer’s benefit at the exact time of his heart attack. Consequently, the Commission found no obligation for the employer to have controverted the claim and ruled that no compensation was due.

ISSUE

Whether the employer-employee relationship is suspended when an employee is on a vacation leave with pay, thereby barring a claim for workmen’s compensation benefits for a death occurring during such leave.

RULING

The Supreme Court reversed the Commission’s decision and reinstated the award of compensation. The legal logic is clear: an employer-employee relationship is not severed or suspended when an employee is on a vacation leave with pay. The Court emphasized that the receipt of regular compensation during leave attests to the continuity of service, as pay is based on the rendition of actual work over a period. The purpose of a vacation leave is to allow the worker to rest and replenish energy to perform duties more effectively upon return, not to sever the employment tie. This situation is analogous to workers on a lawful strike, where the relationship persists despite not rendering actual work.
Therefore, Ucang was still in the employ of the company at the time of his death. The presumption of compensability under the Workmen’s Compensation Act, that an illness or death arising in the course of employment is work-related, remained operative. The employer failed to present substantial evidence to overcome this presumption. The death, having supervened during the employment, was compensable. The Court ordered the employer to pay death benefits, burial expenses, attorney’s fees, and administrative costs.