Read also: CAN THE EMPLOYEES SUE FOR THE DIFFERENCE IN AMOUNT OF WAGES?
The concept of Non-diminution of benefits could be anchored on two points. First is Art. 127 of the Labor Code of the Philippines, as amended. The said article is stated in the following manner:
“Art. 127. Non-diminution of benefits. No wage order issued by any regional board shall provide for wage rates lower than the statutory minimum wage rates prescribed by Congress. (As amended by Republic Act No. 6727, June 9, 1989)”
For illustration of above-mentioned article, let us take the wage rates for the National Capital Region. Under Wage Order No. NCR-22 the daily wage rate is Five Hundred and Thirty-Seven (PHP 537.00) Pesos. An employee covered by said wage order shall receive a daily wage of PHP 537.00 for a work done on the normal working hours unless the employer pays said worker a higher amount. In no case will the employee receive an amount lower than PHP 537.00. Otherwise, the employee is entitled to recover the deficiency from the employer. Also, succeeding wage orders cannot provide for a lower wage rates provided in the previous wage order.
The second concept of Non-diminution of benefits could be anchored on numerous jurisprudence. In the case of Ricardo E. Vergara, Jr. vs. Coca-Cola Bottlers Philippines, Inc., G. R. No. 176985, April 1, 2013, the following was laid down:
“The principle of non-diminution of benefits is actually founded on the Constitutional mandate to protect the rights of workers, to promote their welfare, and to afford them full protection. In turn, said mandate is the basis of Article 4 of the Labor Code which states that “all doubts in the implementation and interpretation of this Code, including its implementing rules and regulations, shall be rendered in favor of labor.
There is diminution of benefits when the following requisites are present: (1) the grant or benefit is founded on a policy or has ripened into a practice over a long period of time; (2) the practice is consistent and deliberate; (3) the practice is not due to error in the construction or application of a doubtful or difficult question of law; and (4) the diminution or discontinuance is done unilaterally by the employer.”
The grant to employees of certain benefits, once evolved into company practice, cannot unilaterally be withdrawn or reduced by the employer.
Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.
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