G.R. No. 110656 - Philippine Airlines, Inc. vs. National Labor Relations Commission

The private respondents were employed by Philippine Airlines, Inc. (PAL) in 1987 as Junior Aircraft Mechanics with an initial monthly salary of P1,860.00.
On October 1, 1987, under the Collective Bargaining Agreement (CBA) between PAL and the Philippine Airlines Employees Association (PALEA), they received a wage increase of P400.00, bringing their total to P2,260.00 per month.
With the effectivity of Republic Act No. 6640 (RA 6640) on December 14, 1987—which mandated an increase in minimum wages—their salaries were adjusted.

The adjustment detailed a basic salary of P1,860.00 plus a P400.00 CBA wage increase and an additional P304.00 under RA 6640, resulting in a gross monthly pay of P2,564.00.

In June 1988, the private respondents were promoted to Avionics Mechanic C, with a new basic pay of P2,300.00 and the existing CBA wage increase of P400.00, making their monthly gross pay P2,700.00.

The respondents contended that due to the promotion their salary should include the additional mandated wage increase of P304.00, thereby totaling P3,004.00 per month.
Petitioner, however, argued that the promotion resulted in a sufficient increase of P440.00 (the difference between the old and new basic salary), which it considered as covering both the mandated RA 6640 wage increase and a promotional increment.

Unable to reach an agreement regarding the additional P304.00 monthly wage increase, the private respondents initiated a case before the National Labor Relations Commission (NLRC) under NLRC-NCR Case No. 00-12-05086-88.
On November 29, 1989, Labor Arbiter Cornelio L. Linsangan rendered a decision ordering PAL to integrate the additional P304.00 into the monthly salary, to pay the currency differential from the time of withdrawal, and to remit 10% of the total award as attorney’s fees. The other claims were dismissed for lack of sufficient basis.
PAL (petitioner) appealed the decision to the NLRC. The NLRC affirmed the Labor Arbiter’s decision, emphasizing that a benefit repeatedly enjoyed by an employee creates a vested right that cannot be rescinded merely because of a subsequent promotion or better salary rates.

Petitioner questioned whether the wage increases under RA 6640 were intended to be permanent components of an employee’s salary, irrespective of subsequent promotional increases.
Petitioner also raised the issue of whether the NLRC gravely abused its discretion by ruling that it had jurisdiction to address a submission involving a question of law concerning the permanence of mandated wage increases.

Whether RA 6640 was meant to grant permanent wage increases that must be maintained as a fixed component of an employee’s monthly salary throughout their career growth and irrespective of promotional salary increases.

Whether the NLRC abused its discretion by asserting jurisdiction to resolve a question of law submitted by the petitioner regarding the nature and application of the wage increase mandated by RA 6640.