Nielsen v. Gobencion (G.R. No. 231935, August 16. 2017)


CASE DIGEST: [G.R. No. 231935, August 16, 2017]. THE NIELSEN COMPANY, INC. VS. BEATRIZ R. GOBENCION AND JOSEPHINE MARIE C. ALINAS.

FACTS: Gobencion and Alinas were employees of Nielsen. Gobencion was employed as a Project Assistant in 1980 and thereafter resigned in 1984. She was rehired in 1989 as a Senior Research Executive and again resigned in 2005. She finally rejoined the company in 2007 as a Director of Measurement Science for Consumer Research, until her availment of its early retirement program in 2012. Alinas, on the other hand, was employed in 2008 as an Associate Director of Client Service. She was later on promoted as Director for Consumer Research in 2009, until her resignation in 2015. Both their employment contracts provide:
Salary- Your annual base salary will be Peso 2,520,000.00 [increased to P3,179,001.00 in 2012][4] payable over 14 months (Php180,000,00 per month; P227.071.50 as increased) [Gobencion] Peso 2,366,000.00 payable over 14 months (Php169,000.00 per month) [Alinas]. xxx

Discretionary Bonus - You are eligible to participate in the ACNielsen Annual Incentive Plan. The amount of your annualized bonus opportunity in Year 2007 is Peso 468,000.00. Your Y2007 incentive target will be prorated from your start date to November 30, 2007. x x x To receive your 2007 AIP payout, you need to be effectively employed with ACNielsen at the time of its actual payout date as determined by AC Nielsen.

x xx

Assignment Guide/Right to Amend - Conditions and circumstances not covered in this letter will be in accordance with established Company policy. The Company reserves the right to revise or amend its policies, including without limitation those relating to employee benefits, in its discretion. This agreement sets forth the entire understanding and agreement of the parties and super[s]edes any and all oral and written agreements and understandings between the parties as to the subject matter of this agreement. This agreement may be changed only in writing and with signatures of all parties. "
Upon retirement, Gobencion was paid P7,770,832.42. Meanwhile, Alinas has yet to receive her last pay as she failed to undergo Nielsen's clearance process.

Respondents, now severed from petitioner, had several email and letter correspondence with it, through its representative, Donna Valino, and its counsel, JG Law, regarding their claim for 13th and 14th month pay. They asserted that they are entitled to 13th month pay, as it was excluded in the "annual base salary" under Presidential Decree No. (P.D. 851), and thus should be an additional income based on wage, but not part of it. The 14th month pay should also be given, being a guaranteed compensation in their employment contract and as part of established company policy.

Petitioner refused to settle the same, averring that their employment contract is silent and does not cover the manner and time of payment of 13th and 14th month pay. It also claimed that the alleged company policy on 14th month pay requires that the employee claiming must still be with the company at the time of payout. Since the issue remained unsettled, respondents filed a complaint before the Labor Arbiter (LA) for nonpayment of salary/wages (14thmonth pay), pro-rated 13th month pay, moral and exemplary damages, and attorney's fees.

The LA ordered petitioner to pay respondents P209,123.87. Respondents' insistence that they are entitled to 13th month pay as mandated by P.D. 851, other than the 13th month pay that they already received was denied by the LA. In doing so, it was held that they are not entitled to 13th month pay under said law, as this applies only to rank-and-file employees. Respondents, being part of top level management who are vested with powers to execute managerial policies, are not covered.

On the entitlement to 14th month pay, it was held that their employment contract expressly provides that this forms part of the "annual base salary". It is neither a bonus nor an additional benefit, as what petitioner points out. Being part of their salary, it is not subject to the established company policy that is given only to employees who are still connected at the time of payout. Attorney's fees of 10% were also awarded as respondents were constrained to litigate.

On appeal, the NLRC affirmed with modification the LA's findings that Nielsen is ordered to pay Gobencion and Alinas' full 13th and 14th month pay for the years 2012 and 2015, respectively. The NLRC held that although respondents are not covered by P.D. 851, they are still entitled to 13th and 14th month pay as these are already included in their "annual base salary". Thus, to deny them of the same would be violative of the Non-Diminution Rule under Article 100 of the Labor Code. As to the contention that the 14th month pay is merely a discretionary bonus, a simple mathematical computation would show that respondents' monthly salary is actually based on the "annual base salary," with 14 months as the divisor, thus:
P2,520,000.00/14 mos. = P180,000.00 monthly
(Gobencion's monthly salary)

P2,366,000.00/14 mos. = P169,000.00 monthly
(Alina's monthly salary).
The NLRC further pointed out that if petitioner's intention was to treat 14th month pay as a discretionary bonus, there would be no need to provide a different amount pertaining to "annualized bonus" vis-a-vis the "annual base salary".A perusal of the record shows that while petitioner was able to receive a copy of NLRC decision on June 13, 2016, it skipped filing a motion for reconsideration and instead directly filed a petition for certiorari before the CA, praying that the NLRC decision be nullified and set aside on the ground of the existence of grave abuse of discretion.

The CA dismissed the petition and affirmed the NLRC decision on the ground that Nielsen failed to file a motion for reconsideration within the reglementary period provided by law.

The CA discussed that the seasonable filing of a motion for reconsideration within the 10-day reglementary period following the receipt by a party of any order, resolution or decision of the NLRC, is a mandatory requirement to forestall the finality of such order, resolution or decision, as found in Article 223 of the Labor Code and Section 14, Rule VII of the New Rules of Procedure of the NLRC.

ISSUE: Petitioner submits that the CA departed from existing jurisprudence when it did not find that the filing of a motion for reconsideration may be dispensed with given that the NLRC decision, as it contends, is a patent nullity.

HELD: The petition is without merit.

In a catena of cases, the Court has consistently ruled that a motion for reconsideration is an indispensable condition before an aggrieved party can resort to the special civil action for certiorari under Rule 65 of the Rules of Court. A motion for reconsideration of the order, resolution or decision of the NLRC should be seasonably filed as a precondition for pursuing any further or subsequent recourse. Otherwise, the order, resolution or decision would become final and executory after ten (10) calendar days from receipt thereof. The rationale for the rule is that the law intends to afford the NLRC an opportunity to rectify such errors or mistakes it may have committed before resort to courts of justice can be had.

Of course, the rule is not absolute and jurisprudence has likewise laid down exceptions when the filing of a petition for certiorari is proper notwithstanding the failure to file a motion for reconsideration. One of these is when the order is a patent nullity, as where the courts quo has no jurisdiction.

Here, Nielsen points out that the reason it did not priorly move to reconsider the NLRC decision is because it believes that the same is a patent nullity.

It is not, however, for Nielsen to decide whether or not the decision is a patent nullity. The Court, in Sim v. National Labor Relations Commission, ruled that petitioners may not arrogate unto themselves the determination of whether a motion for reconsideration is necessary or not. The issue on the grant of 13th month pay by the NLRC can be properly addressed through a timely motion for reconsideration. As earlier emphasized, the purpose of the filing of a motion for reconsideration is to allow the NLRC to correct errors in its judgment, if any. A motion for reconsideration is not only expected but would actually provide an adequate and speedier remedy than Nielsen's petition for certiorari.

Certiorari cannot be resorted to as a shield from the adverse consequences of failure to file the required motion for reconsideration.

For Nielsen's failure to file a motion for reconsideration on the NLRC decision after ten (10) days, the same has already become final and executory.

Be that as it may, even if We set aside the procedural infirmity, the CA could still not be faulted for not giving due course to the petition since Nielsen failed to show any error or grave abuse of discretion on the part of the NLRC in denying its petition. As a rule, misapplication of facts and evidence, and erroneous conclusions based on evidence do not, by the mere fact that errors were committed, rise to the level of grave abuse of discretion.

Here, other than the alleged error committed by the NLRC in ruling on the grant of 13th month pay, Nielsen failed to prove that it was decided in grave abuse of discretion that would justify the proper availment of a petition for certiorari under Rule 65 of the Rules of Court.


[1] "Art. 100. PROHIBITION AGAINST ELIMINATION OR DIMINUTION OF BENEFITS. Nothing in this Book shall be construed to eliminate or in any way diminish supplements, or other employee benefits being enjoyed at the time of promulgation of this Code.

[2] "Philippine National Bank v. Arcobillas, G.R. No. 179648, August 7, 2013, 703 SCRA 226; Lopez Dela Rosa Development Corporation v. Court of Appeals, G.R. No. 148470, April 29, 2005, 457 SCRA 614.

[3] Audi AG v. Mejia, G.R. No. 167533, July 27, 2007, 528 SCRA 378.

[4] Republic v. Pantranco North Express, Inc. (PNEI), G.R. No. 178593, February 15, 2012, 666 SCRA 199.

[5] Malayang Manggagawa ng Stayfast Phils, Inc. v. National Labor Relations Commission, G.R. No. 155306, August 28, 2013, 704 SCRA 24.

[6] G.R. No. 157376 October 2, 2007, 534 SCRA 515.

[7] Aguilar v. Manila Banking Corporation, G.R. No. 157911, September 19, 2006, 502 SCRA 354.

[8] Ysidoro v. Leonardo-De Castro, G.R. Nos. 17153 &190963, February 6, 2012, 665 SCRA 1.

[9] Bergonia v. Court of Appeals, G.R. No. 189151, January 25, 2012, 664 SCRA 322.

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