Case Digest: NWPC v. APL

G.R. No. 150326 March 12, 2014




On June 9, 1989, Republic Act No. 6727 was enacted into law. In order to rationalize wages throughout the Philippines, Republic Act No. 6727 created the NWPC and the RTWPBs of the different regions. Consequently, the RTWPB-NCR issued Wage Order No. NCR-07 on October 14, 1999 imposing an increase of P25.50/day on the wages of all private sector workers and employees in the NCR and pegging the minimum wage rate in the NCR at P223.50/day. However, Section 2 and Section 9 of Wage Order No. NCR-07 exempted certain sectors and industries from its coverage.

Feeling aggrieved by their non-coverage by the wage adjustment, the Alliance of Progressive Labor (APL) and the Tunay na Nagkakaisang Manggagawa sa Royal (TNMR) filed an appeal with the NWPC assailing Section 2(A) and Section 9(2) of Wage Order No. NCR-07. They contended that neither the NWPC nor the RTWPB-NCR had the authority to expand the non-coverage and exemptible categories under the wage order; hence, the assailed sections of the wage order should be voided.

NWPC upheld the validity of the wage order. On appeal, the CA reversed the decision of NWPC, holding that the powers and functions of the NWPC and RTWPB-NCR as set forth in Republic Act No. 6727 did not include the power to grant additional exemptions from the adjusted minimum wage. NWPC moved for reconsideration but the same was denied hence, this petition for certiorari.

ISSUE: Whether or not RTWPB-NCR had the authority to provide additional exemptions from the minimum wage adjustments embodied in Wage Order No. NCR-07

HELD: Yes. Petition granted. NWPC decision reinstated.

Labor Law -the NWPC had the authority to prescribe the rules and guidelines for the determination of the minimum wage and productivity measures, and the RTWPB-NCR had the power to issue wage orders.

Pursuant to its statutorily defined functions, the NWPC promulgated NWPC Guidelines No. 001-95 (Revised Rules of Procedure on Minimum Wage Fixing) to govern the proceedings in the NWPC and the RTWPBs in the fixing of minimum wage rates by region, province and industry. Section 1 of Rule VIII of NWPC Guidelines No. 001-95 recognized the power of the RTWPBs to issue exemptions from the application of the wage orders subject to the guidelines issued by the NWPC

Under the guidelines, the RTWPBs could issue exemptions from the application of the wage orders as long as the exemptions complied with the rules of the NWPC. In its rules, the NWPC enumerated four exemptible establishments, but the list was not exclusive. The RTWPBs had the authority to include in the wage orders establishments that belonged to, or to exclude from the four enumerated exemptible categories. If the exempted category was one of the listed ones, the RTWPB issuing the wage order must see to it that the requisites stated in Section 3 and Section 4 of the NWPC Guidelines No. 01, Series of 1996 were complied with before granting fully or partially the application of an establishment seeking to avail of the exemption.

On the other hand, if the exemption was outside of the four exemptible categories, like here, the exemptible category should be: (1) in accord with the rationale for exemption; (2) reviewed/approved by the NWPC; and (3) upon review, the RTWPB issuing the wage order must submit a strong and justifiable reason or reasons for the inclusion of such category. It is the compliance with the second requisite that is at issue here.

The CA reversed the decisions of the NWPC dated February 28, 2000 and July 17, 2000 mainly on the ground that Wage Order No. NCR-07, specifically its Section 2(A) and Section 9(2), had not been reviewed or approved by the NWPC. However, the NWPC stated that it had reviewed and approved the challenged sections when it upheld the validity of Wage Order No. NCR-07 in its decisions of February 28, 2000 and July 17, 2000.

The wage orders issued by the RTWPBs could be reviewed by the NWPC motu proprio or upon appeal. Any party aggrieved by the wage order issued by the RTWPBs could appeal. Here, APL and TNMR appealed on October 26, 1999, submitting to the NWPC precisely the issue of the validity of the Section 2(A) and Section 9(2) of Wage Order No. NCR-07. The NWPC, in arriving at its decision, weighed the arguments of the parties and ruled that the RTWPB-NCR had substantial and justifiable reasons in exempting the sectors and establishments enumerated in Section 2(A) and Section 9(2) based on the public hearings and consultations, meetings, social-economic data and informations gathered prior to the issuance of Wage Order No. NCR-07. The very fact that the validity of the assailed sections of Wage Order No. NCR-07 had been already passed upon and upheld by the NWPC meant that the NWPC had already given the wage order its necessary legal imprimatur. Accordingly, the requisite approval or review was complied with.