G.R. No. L-49774 - San Miguel Corporation vs. Inciong

Petitioner: San Miguel Corporation (Cagayan Coca-Cola Plant) (“Petitioner”) challenged administrative orders requiring recalculation of its employees’ 13th-month pay.
Respondents: Hon. Amado G. Inciong, Deputy Minister of Labor (“Public Respondent”), and the Cagayan Coca-Cola Free Workers Union (“Private Respondent”).

January 3, 1977 – Private Respondent filed a complaint before Regional Office No. X alleging that Petitioner excluded from 13th-month pay computation: sick, vacation and maternity leaves; rest-day and special-holiday premiums; regular holiday pay; and night differentials.
February 15, 1977 – Regional Office No. X issued an order directing Petitioner to pay the difference between actual 13th-month pay and what would have been due had the disputed items been included (excluding overtime premium and emergency cost-of-living allowance).
June 7, 1978 – Deputy Minister of Labor Inciong affirmed the Regional Office order and dismissed Petitioner’s appeal for lack of merit.
December 19, 1978 – Public Respondent denied Petitioner’s motion for reconsideration and ordered immediate execution of the June 7 order.
February 14, 1979 – The Supreme Court issued a temporary restraining order enjoining enforcement of the December 19 order pending resolution of this petition for certiorari and prohibition with preliminary injunction.

Scope of “basic salary” under Presidential Decree No. 851 and its implementing rules

Whether payments for sick, vacation and maternity leaves, rest-day and special-holiday premiums, regular holiday pay, and night differentials are part of the “basic salary” for purposes of computing the mandatory 13th-month pay.
Whether the implementing and supplementary rules of PD 851 permit the inclusion of those payments in the 13th-month pay computation.