Title
Luzon Stevedoring Co., Inc. vs. Luzon Marine Department Union
Case
G.R. No. L-9265
Decision Date
Apr 29, 1957
A labor dispute over unpaid wages, overtime, and reinstatement led to a Supreme Court ruling affirming the CIR's decision, upholding workers' rights under the Eight-Hour Labor Law.

Case Digest (G.R. No. 150694)

Facts:

  • Background of the Case
    • Luzon Stevedoring Co., Inc. filed a petition for certiorari to review a resolution of the Court of Industrial Relations dated June 5, 1955.
    • A supplemental petition was subsequently filed on September 5, 1955, and both petitions were docketed by the Supreme Court on September 15, 1955.
  • Originating Labor Dispute
    • On June 21, 1948, the Luzon Marine Department Union (respondent) filed a petition with the Court of Industrial Relations, presenting several demands against Luzon Stevedoring Co., Inc.
    • Demands included full recognition of the right to collective bargaining, the imposition of a close shop, and the implementation of a check-off system.
  • The Strike and Subsequent Proceedings
    • On July 18, 1948, during the pendency of the petition, the Union declared a strike.
    • This strike was later ruled illegal by the Court in case G. R. No. L-2660 (promulgated May 30, 1950).
    • Following the illegal strike declaration, the Union filed a “Constancia” with the Court of Industrial Relations to seek resolution of the remaining demands.
  • Unresolved Demands Presented by the Union
    • Overtime Compensation
      • Payment for work in excess of eight (8) hours to include an overtime rate of 50% of the regular rate.
      • Payment for work on Sundays and legal holidays at double the regular rate.
    • Specific Claims Regarding Compensation and Reinstatement
      • Payment of wages for officers, engineers, and crew members for the second half of December 1941.
      • Reinstatement with pay for certain employees (e.g., Ciriaco Sarmiento, Rafael Santos, Lorenzo de la Cruz) who were suspended or discharged allegedly due to union activities.
  • Evidence and Trial Court Proceedings
    • The case was heard from June 8, 1951, to January 7, 1954, with parties presenting both oral and documentary evidence.
    • During one hearing, the original intervenor (Union de Obreros Estibadores de Filipinas) moved to withdraw, which was granted by the Court of Industrial Relations.
    • On February 10, 1955, the trial judge delivered a decision noting:
      • The company provided three free meals daily and a 20-minute rest after each meal.
      • Employees worked from 6:00 a.m. to 6:00 p.m. daily, including Sundays and legal holidays.
      • Overtime pay was made at prescribed rates (initially P4 for officers, patrons, and radio operators and P2 for other crew members before adjustments in March 1947, with subsequent increases thereafter).
      • Adjustments during periods of repairs (reducing the working period to 8 hours) were recognized.
      • Uncertain evidence regarding overtime work beyond the regular schedule led to the denial of certain overtime claims.
      • The company was designated as a public service operator under Section 18-b of Commonwealth Act No. 146 and thereby exempted from additional compensation for Sunday and holiday work (based on Section 4 of Commonwealth Act No. 444).
  • Developments on Reconsideration
    • The Union filed a motion for reconsideration seeking:
      • Recognition of a 4-hour overtime pay entitlement independent of “coffee-money.”
      • Inclusion of daily meal allowances as part of the actual compensation for computing overtime due.
      • Payment for “unearned” wages from the moment of separation for employees dismissed without just cause.
    • Luzon Stevedoring Co., Inc. sought reconsideration only with respect to the interpretation of “working time” for seamen under the Eight-Hour Labor Law.
    • On June 6, 1955, the Court en banc modified the February 10, 1955, decision to provide that the 4 hours of overtime work should be paid separately, noting extra payment practices for work beyond 6:00 p.m. for some tugboat crew members.
    • The Company’s motion for reconsideration was denied.
    • Subsequently, the petitioner filed a supplemental petition for certiorari following the Court of Industrial Relations’ clarification that the 20-minute meal rest should not be deducted from the overtime work.
  • Respondents’ Position
    • The Luzon Marine Labor Union, as well as the judges of the Court of Industrial Relations, filed motions and answers arguing:
      • That the issues raised were purely factual without any significant question of law.
      • The findings of facts and interpretations prevailing in the CIR decisions were proper and within the court’s powers.
    • The dispute centered on the application of the Eight-Hour Labor Law to seamen, overtime computations, retroactive payment of back overtime wages, and the legal boundaries concerning administrative modifications.

Issues:

  • Interpretation of “Hours of Work” for Seamen
    • Whether the definition of “hours of work” applied to dryland laborers is equally applicable to seamen, given the distinct nature and conditions of their employment.
    • The contention that although seamen are required to remain aboard tugboats for 12 hours, their work is not continuous and includes periods that may not constitute active work if they are allowed to rest or even leave the immediate area of duty.
  • Reliance on the Secretary of Justice’s Opinion
    • Whether a person can be penalized for acting on an opinion issued by the Secretary of Justice in the absence of any judicial pronouncement.
    • The relevance of Opinion No. 247 (Series of 1941) concerning interisland vessels versus the conditions on tugboats plying in bays and rivers.
  • Waiver and Acceptance of Wage Conditions
    • Whether employees, having full knowledge of the law and voluntarily agreeing to a longer working schedule in exchange for a definite wage, have thereby retroactively waived their rights to overtime compensation.
    • The legal implications of continued employment without protest over a period of almost two years as an indication of acceptance of the wage arrangement.
  • Application of Estoppel
    • Whether the principle of estoppel should bar union members from claiming back overtime compensation given their prolonged acquiescence in accepting the wages as sufficient compensation.
    • Consideration of prior legal precedents that hold estoppel and laches cannot be invoked against claims for extra compensation under the Eight-Hour Labor Law.
  • Extent and Rule of Retro-activity
    • Determining the appropriate commencement date for the computation of back overtime wages if such compensation is deemed due.
    • Whether the computation should start from the filing of the petition or from the date when overtime work was actually rendered.
  • Public Policy and Economic Considerations
    • Whether granting a sizable amount in back overtime wages is consistent with the dictates of public policy, especially considering national economic recovery and financial stability.
    • The theoretical concern that retroactive payments might impose an undue financial burden on the employer.
  • Validity of the Court of Industrial Relations’ Resolution
    • Whether the resolution issued en banc by the Court of Industrial Relations, despite being challenged as unsupported in facts and law and being characteristically arbitrary and capricious, should be declared illegal.
    • The procedural propriety of the CIR’s authority to modify its own decision in light of motions for reconsideration submitted by both parties.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)
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