Guide on Employee Compensation and Benefits Vol. 1, Second Edition

1,198.00

This book is the 2nd edition of one of ATTY. ELVIN B. VILLANUEVA’s best selling titles Guide on Employee Compensation and Benefits Volume 1. HR Practitioners, both new and veterans will find this work useful in understanding and keeping up with the latest rules, doctrines and principles on labor standards.

 

The subject matter of compensation and benefits is among the edgy topics which most HR practitioners, business managers, and even owners find challenging. As always, anything that deals with human psychology on pay, rewards, motivation, and equity requires full attention and creative solution.

 

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This work discusses the labor standards most particularly the exceptive rules where most practitioners are often blindsided. The rules and doctrines are tackled with illustrations and sample computations. Presentation of pay computations proceeds from the ordinary day, regular holiday, special day, and rest day or a combination of both holidays and rest days. These affects the daily rate, overtime, and nightshift differential.

There are relevant Supreme Court decisions where the high court interprets crucial areas of compensation. Rules on successive regular holidays are shown with example. Also, illustrative cases for overtime and nightshift differential are shown using different hours worked such as 2-hour, 4-hour, or even 8-hour OT and nightshift with computations when these coincide or concur on the same day.

 

The author also delineates the impact of benefits when the clock strikes 12:00 midnight such as on overtime, holiday pay, etc. This is particularly crucial for those with call center operations. Also discussed are company-initiated benefits rule, management prerogative to require overtime work, rule on travel time, brownout and other time-related issues.
New laws and rules are correlated with existing ones in the Labor Code such as the lactation period, primer on expanded maternity leave law (with sample salary differential computation), DO 178 and DO 184 on breaks mandated for employees who need to stand or sit for too long at work and the telecommuting act which affects the hours of work depending on the arrangement between the employer and employee.

 

At the end of the day, compensation and benefits is an interesting area of HR/Labor practice. The key to harmony is understanding of the rules and it starts with acquisition of knowledge.

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Description

Title: Guide on Employee Compensation and Benefits, Volume 1, 2nd Edition 2020
Author: Atty. Elvin B. Villanueva
Publisher:
Central Book Supply, Inc.
ISBN: 
978-621-02-0825-2
No. Of Pages:
Approx. 350
Size:  6″x9″
Binding: Softbound

TABLE OF CONTENTS

INTRODUCTION

Statutory Compensation and Benefits at a Glance

CHAPTER ONE

HOURS OF WORK

  1. Coverage and Exclusions………………………………. 10

A.1. … Government employees…………………………… 12

A.2. … Managerial employees…………………………….. 14

A.3. … Other officers or members of the managerial staff        16

A.4. … Domestic servants and persons in the personal service of another     21

A.5. … Workers paid by results…………………………… 23

A.6. … Field personnel……………………………………….. 29

A.7. … Members of the family of the employer………. 33

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  1. Normal Hours of Work……………………………………. 33

Overview of Selected Principles

B.1. …. What is the rationale of the law?………………. 35

B.2. …. Employer may reduce the eight-hour work day 35

B.3. …. Compressed Workweek (CWW)……………….. 38

……….. D.O. No. 02, Series of 2004

……….. CWW Guidelines

……….. Illustration of CWW using NCR Minimum Wage

……….. Flexible Work Under Solo Parent’s Act

B.4. …. Telecommuting Act …………………………………. 47

B.5…… Effect of Lactation Period in Work Hours

B.6. …. Broken hours…………………………………………. 47

B.7. …. Work in Shifts…………………………………………. 47

B.8. …. Reduction of workdays…………………………… 48

B.9. …. Part-time workers…………………………………… 49

B.10. .. Hours of Work of Hospital and Clinic Personnel 50

B.11…. Terminologies in Article 83 of the Labor Code 54

B.13…. The Philippine Statistics Authority (PSA), formerly NSO, determines size of population

B.14…. Regular Working Hours of Hospital and Clinic Employees          56

B.15. .. Regular working days of Hospital and Clinic Personnel 56

B.16…. Overtime Work of Hospital and Clinic Personnel 56

B.17. .. Hours worked of Hospital and Clinic Personnel 57

B.18…. Additional Compensation of Hospital and Clinic Personnel         57

B.19. .. Public Health Workers……………………………… 58

B.19.1….. Who are Public Health Workers (PWH)           58

B.19.2….. Normal Hours of Work of Public Health Workers        58

B.19.3….. Hours Worked; Inclusion……………. 59

B.19.4….. Overtime Work of Public Health Workers        59

B.19.5….. Rest day of Public Health Workers 59

B.19.6….. Night Shift Differential Pay of Public Health Workers  60

B.20…. It is a management prerogative to change working hours          60

 

  1. Hours Worked………………………………………………… 64

C.1…… Principles in determining hours worked……… 64

C.2…… Coffee breaks and rest period of short duration            65

C.3…… Lactation Break Period

C.4…… Break Period Under D.O. 178

C.5…… Break Period Under D.O. 184

C.6…… Waiting time and working while on call………. 66

C.7…… Travel time……………………………………………… 67

C.7.1……. Overnight travel that cuts across employee’s workday         70

C.7.2……. Working while traveling……………… 70

C.6…… Preliminary and postliminary activities………… 70

C.7…… Attendance in lectures, meetings and training programs           71

C.8…… Attendance in CBA negotiations and grievance meetings          72

C.9…… Time spent by employees in hearings or conferences in cases filed against the employer is not compensable          73

C.10…. Attendance or participation in strikes or pickets 74

C.11…. No backwages shall be awarded for time spent on strike         75

C.12…. Working time of sea based workers or seamen 76

C.13…. Semestral break is just an interruption of work of full-time teachers hence, compensable       78

C.14…. Work Interruptions due to brown-Outs………. 79

C.14.1….. Brown out not exceeding 20 minutes 79

C.14.2….. Rule if more than 20 minutes………. 79

C.15…. Burden of proving hours worked……………… 81

 

  1. Meal Periods………………………………………………….. 81

D.1…… Employees may do anything they want during meal break         82

D.2…… Coffee break is compensable…………………… 85

D.3…… Employee is not prohibited from leaving the work premises to have meal break           85

D.4…… What constitutes compensable work is a question of fact        86

D.5…… An employee who works for two consecutive shifts shall be paid his lunch breaks   87

 

  1. Night Shift Differential……………………………………. 88

E.1…… To whom night-shift differential is not applicable           88

E.2…… Night-shift differential rate is at least 10%….. 89

E.3…… Night-shift differential on top of overtime rate, rest day and holiday      90

Illusrations

 

  1. Overtime Work…………………………………………….. 100

F.1…… Computation of Overtime Work……………….. 104

F.2…… Payment of overtime does not bar payment of night-shift differential    105

F.3…… Summary of rules on overtime work………… 106

F.3.1….. Overtime work on ordinary working day          106

F.3.2….. Overtime work on Rest Days and Special Days           107

F.3.3….. Overtime Pay for Regular Holiday Work            108

F.3.4….. Overtime work for Regular Holiday Falling on Rest Day           109

…………. Another approach in computation ……………………………

F.3.5….. Overtime work of Hospital and Clinic Personnel           110

F.4…… Premium pay vs. overtime pay………………… 111

F.5…… Parties May Stipulate on Overtime Rate……. 113

F.6…… Overtime Work of Teachers in Private Schools 114

F.7…… Built-In overtime pay………………………………. 114

F.8…… Overtime work of seamen……………………… 115

F.9…… Proof of overtime work………………………….. 118

F.10…. Burden of proof of payment of overtime work rests on the employer   118

F.11…. Admission by silence of liability for employee’s claims   120

F.12…. Excess payment of salary does not offset overtime liability of employer          121

F.13…. No wage distortion for payment of overtime 121

F.14…. There is no diminution in pay if the fixed overtime pay is removed for being mere supplemental benefit          122

F.15…. Erroneous payment of overtime work does not create demandable right to the recipient         122

F.16…. In General, Right to Overtime Pay is not Subject to a Waiver     123

F.17…. Payment of overtime for 12-hour normal work per day is not unjust enrichment on the part of the workers   125

F.18…. But waiver is valid if shown to be made in consideration of certain valuable privileges           126

F.19…. In a valid compressed workweek (CWW), there is no overtime pay     126

 

  1. Undertime…………………………………………………….. 127

G.1….. Undertime shall not be offset by overtime: Rationale of the prohibition on offsetting     127

……….. Illustration ………………………………

G.2….. Offsetting of leave against overtime pay….. 129

 

  1. Emergency Overtime Work………………………….. 130

H.1…… Refusal to render overtime work constitutes insubordination    131

H.2…… Overtime boycott is a form of illegal strike… 132

 

  1. Computation of Additional Compensation….. 132

I.1……. Non-Diminution of Benefits……………………… 133

 

 

CHAPTER TWO

 

REST PERIODS

 

  1. Right to Weekly Rest Day……………………………… 134

A.1….. Application of weekly rest period……………. 135

A.2….. Repeal of Blue Sunday Law…………………… 135

A.3….. At least twenty-four hours of Rest Day…… 136

A.4….. Employee may choose rest day due to religious reasons          137

A.5….. Determining the weekly Rest Day……………. 138

A.6….. Rest day cannot be offset by work on regular workdays         138

……….. Illustrations ………………………………

A.7….. Employer’s act of paying the daily employ-ees for holidays even if it falls on rest day is binding         140

A.8….. Case where a monthly-paid employee is entitled to rest day pay          141

 

  1. When Employer May Require Work on a Rest Day 141

B.1…… Employee cannot be compelled to render rest day work; exceptions    144

B.2…… Compensation for Rest Day, Sunday or Holiday Work   144

B.3…… To whom rest day pay is applicable………… 145

B.4…… Computation of rest day work………………… 147

……….. Premium pay rates ……………………

……….. Illustration ……………………………..

B.5…… Employer and the employees may stipulate a higher rate           149

B.6…… Rest day rate for public health workers…… 150

B.7…… Waiver of rest day compensation is invalid. 150

 

 

CHAPTER THREE

 

REST DAY, SUNDAY OR HOLIDAY WORK, HOLIDAYS, SERVICE INCENTIVE LEAVES AND SERVICE CHARGES

 

  1. Right to Holiday Pay………………………………………. 151

A.1….. Changes in Article 94 on Holiday Pay………. 151

A.2….. Changes under Executive Order No. 203…. 151

A.3….. Changes under Republic Act 9177………….. 153

A.4….. Legal Basis of the controversial holidays under President Arroyo        154

A.5….. Holiday pay during Muslim holidays…………. 155

A.6….. Holidays under R.A. No. 9492…………………. 155

A.7….. List of holidays in R.A. No. 9492……………… 156

A.8….. Day of Holiday may not be the date of celebration         156

A.9….. Day of General Elections as a Holiday……… 157

A.10… Ninoy Aquino Day…………………………………. 159

A.11… Declaring Eidul Adha as regular holiday

A.12… List of Holidays for Year 2019

……….. Additional Special Under Proclamation No. 555

A.13… Other Holidays and Holiday Policies…………. 159

A.14… Concept of Holiday Pay………………………….. 161

A.14.1…. Coverage of Holiday Pay…………. 162

A.14.2…. Holiday Pay of Monthly Paid Employees          162

A.14.3…. Mandate to Pay Work on Holidays 163

A.14.4…. Payment of Holiday Work; Ordinary Regular Holiday Work     163

A.14.5…. Additional premium to be paid when the Regular Holiday work falls on a scheduled Rest Day         164

A.14.6…. Overtime Work on a Regular Holiday 165

A.14.7…. Overtime Work on a Regular Holiday falling on Rest Day       166

A.15… Special Days or Special Holidays……………. 166

A.16… “No Work, No Pay” as applied to Special Holidays or Special Days       167

A.17… Basic Pay Only for Special Working Holidays 168

A.18… If regular holiday falls on a sunday, the following day is a special holiday        168

A.19… Effect of absences on holiday pay………….. 169

……….. Illustration …………………….

A.20… Rule on successive Regular Holidays……… 171

……….. Illustration ………………………………..

A.21… Temporary or Periodic shutdown/cessation of work     171

A.22… Holiday Pay of certain employees……………. 172

A.23… Holiday Pay of Workers Paid by Results…… 173

A.24… Holiday Pay as applied to Field Personnel…. 177

A.25… An employee who is required to be at specific places and at specific times, cannot be field personnel although he works away from the principal office………………………………… 179

A.26… Holiday Pay of Seasonal Employees………… 182

A.27… Employees with no Regular Working Days are Entitled to Holiday Pay   182

A.28… Entitlement of Monthly Paid Employees to Holiday Pay    183

A.29… Holiday Pay and the Divisor……………………. 188

A.30… Reckoning Period to Compute Holiday Pay… 190

A.31… Payment of holiday pay as company practice cannot be withdrawn    190

A.32… Withdrawal of holiday pay benefits may constitute unfair labor practice          191

A.33… CBA vs. Labor Code provisions on payment of holiday pay      191

A.34… Burden of proof on holiday pay………………. 193

 

  1. Right to Service Incentive Leave (SIL)…………. 194

B.1…… Purpose of Vacation Leave (VL)…………….. 196

B.2…… Coverage of SIL……………………………………. 196

B.3…… SIL of Field Personnel……………………………. 198

B.4…… SIL of Employees Paid by Results……………. 199

B.5…… Though entitled to COLA and 13th Month Pay, employee may not be granted SIL         202

B.6…… Right to Service Incentive Leave…………….. 203

B.6.1……. Meaning of “at least one year of service”      203

B.7…… SIL may be used for both Vacation (VL) and Sick Leaves (SL)            204

B.8…… VL and other leave benefits may be deemed compliance with SIL        204

B.9…… Regulation of Vacation and Sick Leaves is a management prerogative 205

B.10…. Service Incentive Leave is commutable to cash 205

B.10.1….. Basis of Commutation……………… 207

B.10.2….. Conversion of Benefit is Pro Rata 207

B.10.3….. Sample Computation………………… 208

B.11…. CBA vs. Implementing Rules…………………… 208

B.12…. Burden of Proof of Payment of SIL………….. 211

B.13…. Employment relationship is not suspended while employee is on vacation leave          212

B.14…. There must be a causal connection between the cause of death and the performance of duty of employee on leave for benefits to be payable……………………………………………….. 213

B.15…. Leave benefits that ripened into company practice cannot be unilaterally withdrawn  214

B.16…. Other forms of statutory leave benefits…… 215

1….. Maternity Leave…………………………….. 215

Expanded Maternity Leave Law (EMLL)

Salary Differential

2….. Paternity Leave……………………………… 217

3….. Solo Parent’s Leave……………………….. 221

4….. Leave for victims of violence under R.A. No. 9262 or the Violence Against Women and Their Children (VAWC)            225

5….. Other Leave benefits that may be stipulated          229

5.1…. Bereavement Leave………………. 229

5.2…. Leave Benefits under Retirement Law         233

B.17…. Reckoning period as regards prescription of SIL claim  235

B.18…. SIL Computation is not limited to three (3) Years            238

 

  1. Service Charges…………………………………………… 240

C.1…… Coverage…………………………………………….. 240

C.2…… Meaning of “Managerial Employee” for purposes of implementing service charges      241

C.3…… Distribution of service charges……………….. 241

C.4…… Frequency of distribution……………………….. 242

C.5…… Integration of service charges………………… 242

C.6…… Tips distribution shall be the same as Service Charges 243

C.7…… Service Charges: CBA vs. Implementing Rules 243

C.8…… Service Charges are distinct and separate from ECOLA           244

C.9…… Service Charge is not deductible from wages 245

 

 

CHAPTER FOUR

 

WAGES

 

  1. Preliminary Matters……………………………………… 246

A.1….. Concept of Wages………………………………… 249

A.1.1…. Teacher’s remuneration from additional teaching load forms part of the basic wage 249

A.1.2…. An indirect employer is liable only for unpaid wage within the context of Article 97   249

A.1.3…. Wage vs. Salary………………………. 251

A.1.4…. Basis of claim for wages…………… 254

A.1.5…. “No Work, No Pay” and the monthly-paid employees    255

A.1.6…. “No Work, No Pay” is not determinative of Employer-Employee Relationship   256

A.2….. Facilities…………………………………………….. 257

A.2.1…. Facilities are included in the definition of wage            257

A.2.2…. Supplements vs. Facilities………….. 263

A.2.3…. Case where fixed overtime of 16 hours and out-of-port allowance are mere supplements   266

A.2.4…. Authorized Meal and Snacks Subsidy 267

A.2.5…. Allowances in the form of fringe benefits do not form part of basic salary    270

A.2.6…. Regular allowances form part of the separation pay of illegally dismissed employees           270

A.2.7…. The rule on the inclusion of allowances in the separation pay is applicable to termination for authorized causes     271

A.2.8…. Allowances are not facilities as evidenced by their non-taxability      272

A.3….. Commission forms part of wage……………… 273

A.3.1…. There is neither law that requires payment of commission nor formula for computation         274

A.3.2…. The employee should present credible evidence to prove entitlement to commission 276

A.3.3…. Should separation pay computation include commission?        276

A.3.4…. Commission must be earned by actual market transactions     279

A.3.5…. Are commissions included in the computation of 13th-Month Pay?      279

A.3.6…. Instance when commission is included in the computation of 13th-month pay            282

A.4….. Bonus is not part of wage……………………… 283

A.4.1…. Instance when bonus is considered part of the wage            284

A.4.2…. Payment of 13th-Month Pay may be an admission of the amount of employee’s monthly salary         284

A.5….. 13th-Month pay is included in the definition of “wage”   285

A.6….. Gratuity pay is not part of wage……………… 285

A.7….. Definition of “person,” “employer,” “employee,” “agriculture” and “employ under article 97      287

A.7.1…. Relevance of the definition………… 288

 

  1. Application of Rules on Wages…………………….. 293

B.1…… Rationale behind the non-applicability of article 98 to other group of workers  295

 

CHAPTER FIVE

 

COMPANY-INITIATED OR VOLUNTARY BENEFITS

 

  1. Preliminary Matters……………………………………………

A.1….. Pay Structure……………………………………………..

A.1.1…. Compensation Strategies…………………

A.2….. Benefits, gainsharing and incentives programs

A.2.1…. Productivity Incentives Act of 1990 (R.A. 6971)

A.2.2…. Basic Pay ……………………………………..

A.3….. Concept of company-initiated benefits…………..

A.4….. Nature of Company-Initiated Benefits…………….

A.5….. Bonus………………………………………………………..

A.5.1…. Bonus that is part of regular practice..

A.6….. Christmas Party…………………………………………..

A.7….. Salary increases are not automatically given….

  1. Forfeiture of Company-Initiated Benefits………….

B.1…… Contractual nature of forfeiture clause………….

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