[SP No. 54751. April 25, 2001]

SAVE MORE DRUG/CARMEN TAN, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER, MANUEL ASUNCION, AND CARMENCITA TAPIADOR, respondents.

1. LABOR LAW; LABOR STANDARDS; WAGE RATIONALIZATION ACT (RA 6727); EXEMPTION FROM COVERAGE OF WAGE RATIONALIZATION ACT NOT AUTOMATIC; FAILURE TO APPLY FOR EXEMPTION, EFFECT OF.—Exemption from the coverage of the “Wage Rationalization Act”, is not automatic even though under Section 1 (b). Chapter 1 thereof employers in the retail and service establishments regularly employing less than 10 workers are exempted from the statutory minimum wages fixed by the Regional Tripartite & Wage Board (RTWB). for under Section 4 (c) and Section 15 (1) of the same Chapter, it is necessary that the employer must first apply for exemption with the RTWB failing which it is required to comply with the wage orders issued by the Board. The same holds true with respect to exemptions from coverage of the service incentive leave pay law as Murillo, et al. vs. Sun Valley Realty Inc., 163 SCRA 271, 277 [1988] holds that it is incumbent upon the employer to show that he belongs to that class exempted by law from payment thereof.
2. ID.; ID.; ID.: THIRTEENTH MONTH PAY (PD 85); EMPLOYERS EXEMPTED FROM PAYING THEIR EMPLOYEES A THIRTEENTH MONTH PAY— Under the Revised Guidelines on the Implementation of the 13th Month Pay dated November 16, 1987 implementing Presidential decree No. 85 dated December 12, 1975 “requiring all employers to pay THEIR EMPLOYEES A THIRTEENTH MONTH PAY”, BS amended by Memorandum Order No. 28 dated August 13, 1986, the following employers fall under the exemptions: 1. The Government and any of its political subdivisions including government owned and controlled corporations, except, those corporations operating essentially as private subsidiaries of the Government. 2. Employers already paying their employees a 13th month pay or more in a calendar year or its equivalent at the time of this issuance. 3. Employers of household helpers and persons in the personal services of another in relation to such workers. 4. Employers of those who are paid on purely commission, boundary, or task basis, and those who are paid a fixed amount of performance of a specific work. irrespective of the time consumed, in the performance thereof, except
   where the workers are paid on a piece-rate basis in which case the employer shall grant the required 13th month pay to such workers.
3. ID.; ID.; TERMINATION: ABANDONMENT: RETURN TO WORK ORDER ISSUED AFTER EMPLOYEE FILED COMPLAINT FOR ILLEGAL DISMISSAL NEGATE CLAIM OF ABANDONMENT.—With respect to the legality of private respondent’s dismissal: Petitioners failed to establish their claim that private respondent abandoned her work by not complying with the return to work letter dated July 15, 1997. That said letter was mailed only after the complaint for illegal dismissal was instituted by private respondent indeed indicates that. as the Labor Arbiter observed, was a mere afterthought.

ORIGINAL ACTION in the Court of Appeals.

The facts are stated in the opinion of the Court.

Jeni Esther R. Tugade-Abrazaldo for petitioners.

Apolinario C. Barrios for complainant.

CARPIO MORALES, J.:

Petitioners CARMEN TAN and SAVE MORE DRUG appeal by way of certiorari under Rule 65 of the 1997 Rules on Civil Procedure the Resolutions of February 24 and July 27, 1999 of the National Labor Relations Commission (NLRC) affirming the Decision of the Labor Arbiter finding Carmencita Tapiador (private respondent) illegally dismissed and denying the motion for reconsideration of the Resolution of February 24, 1999, respectively.

Petitioner Save More Drug, a retail store of pharmaceutical products of which petitioner CARMEN G. TAN is the proprietor, hired private respondent in 1991 as one of its sales clerks in its Don Antonio Heights-Quezon City outlet.

On July 8, 1997, petitioners suspended private respondent for a period of three days ending on July 11, 1997 on account of her habitual absenteeism and tardiness – a fact admitted by private respondent in her handwritten letters dated September 15, 1995, January 19, 1996, June 4, 1996, and November 9, 1996 (Annexes “I” – “L” of Petition, pp. 42-45).

Private respondent, claiming that after serving her suspension which, so she claims, was not on account of her tardiness and absenteeism but for failure to “record in a yellow listing three (3) items bought by customer before it was punched in the cash register by the cashier”, petitioners refused to “reinstate” her, filed on July 18, 1997 a complaint against petitioners for illegal dismissal, underpayment of wages, non-payment of service incentive leave and thirteenth month pay with the Labor Arbitration Branch of the NLRC.

Controverting private respondent’s allegations, petitioners submitted the return to work letter of their counsel mailed on August 6, 1997, among other documents.

By Decision of June 19, 1998, the Labor Arbiter found for private respondent. The dispositive portion of the decision reads:

Wherefore, the respondents are hereby ordered to reinstate the complainant with full backwages from the time her salary was withheld until she is actually reinstated. To this date, her backwages has reached to P57.418.00. The respondents are likewise ordered to pay the complainant the sum of P 24,127.48 as salary differential; P23.375.00 as service incentive leave pay and P 2,574.00 as 13th month pay.

In finding for private respondent, the Labor Arbiter took into account the following considerations, inter alia:

1. The complaint for illegal dismissal was filed on July 16, 1997, before August 6. 1997, the date of mailing of petitioners’ counsel’s return-to-work letter dated July 15, 1997, and

2. Since petitioners received the summons and a copy of the complaint for illegal dismissal on July 29, 1997, the return-to-work letter was a mere afterthought to legitimize the refusal to accept private respondent back to work.

The NLRC affirmed the Decision of the Labor Arbiter in its Decision of February 24, 1999 and denied petitioner’s Motion for Reconsideration thereof in its Resolution of July 27, 1999.

Hence, the present petition.

Petitioners asseverate that private respondent was not illegally dismissed and that she is not entitled to salary differentials, 13th month pay, and service incentive leave pay because petitioner Save More Drug is into retail business and employs less than 10 employees, hence, exempted form the coverage of the pertinent Wage Orders and payment of service incentive leave under the Labor Code.

The petition fails.

With respect to the legality of private respondent’s dismissal: Petitioners failed to establish their claim that private respondent abandoned her work by not complying with the return to work letter dated July 15, 1997. That said letter was mailed only after the complaint for illegal dismissal was instituted by private respondent indeed indicates that, as the Labor Arbiter observed, was a mere afterthought.

It surfaces that petitioner are liable to pay backwages.

On private respondent’s entitlement to monetary benefits: Petitioners did not assert that private respondent was not a regular employee.

Neither did petitioners present proof during the proceedings before the Labor Arbiter that the drug store business is one of those exempted from the coverage of Republic Act No. 6727. otherwise known as the “Wage Rationalization Act” and from paying service incentive leave pay and 13th month pay.

Exemption from the coverage of the “Wage Rationalization Act”, is not automatic even though under Section 1 (b). Chapter 1 thereof employers in the retail and service establishments regularly employing less than 10 workers are exempted from paying the statutory minimum wages fixed by the Regional Tripartite & Wages Board (RTWB), for under Section 4 (c) and Section 15 (1) of the same Chapter, it is necessary that the employer must first apply for exemption with the RTWB failing which it is required to comply with the wage orders issued by the Board. The same holds true with respect to exemptions from coverage of the service incentive leave pay law as Murillo et al. v. Sun Valley Realty Inc., 163 SCRA 271, 277 [1988] holds that it is incumbent upon the employers to show that he belongs to that class exempted by law from payment thereof.

As for payment of the 13th month pay, the Court finds that under the Revised Guidelines on the Implementation of the 13th month pay dated November 16, 1987 implementing Presidential Decree No. 85 dated December 12, 1975.

“REQUIRING ALL EMPLOYERS TO PAY THEIR EMPLOYEES A THIRTEENTH MONTH PAY“, as amended by Memorandum Order No. 28 dated August 13, 1986, petitioner drugstore does not fall under any of the following exemptions:

1. The Government and any of its political subdivisions including government owned and controlled corporations, except, those corporations operating essentially as private subsidiaries of the Government.

2. Employers already paying their employees a 13th month pay or more in a calendar year or its equivalent at the time of this issuance.

3. Employers of household helpers and persons in the personal service of another in relation to such workers.

4. Employers of those who are paid on purely commission, boundary, or task-basis, and those who are paid a fixed amount of performance of a specific work, irrespective of the time consumed, in the performance thereof, except where the workers are paid on a piece-rate basis in which case the employer shall grant the required 13th month pay to such workers.

In fine, petitioners had no just or authorized cause in dismissing private respondent from her post. They are therefore, obliged to reinstate her.

If reinstatement is no longer feasible, however, as where the parties have already strained relations, then private respondent is to be awarded a separation pay computed at one month per year of service plus backwages (Reformist Union of RB Liner Inc. v. NLRC, 266 SCRA 728 [1996] citing Sealand Service Inc. v. NLRC, 206 SCRA 701, 710 [1992]).

WHEREFORE, the petition is hereby DENIED. The assailed Resolutions are affirmed, with modification, in accordance with the statement in the immediately preceding paragraph, that if reinstatement is no longer feasible, petitioners are ordered to pay private respondent separation pay at the rate of one month salary per year of service.

SO ORDERED.

Rivera and de Guia-Salvador, JJ., concur.

Petition denied. Resolutions affirmed with modification.

CERTIFICATION

I hereby certify that this Decision was reached after due consultation among the members of this Division in accordance with the provisions of Section 13, Article VIII of the Constitution.

(SGD.) CONCHITA CARPIO MORALES
Chairman