LEXAL LABORATORIES AND/OR JOSE ANGELES, MANAGER, PETITIONERS, VS. NATIONAL CHEMICAL INDUSTRIES WORKERS UNION-PAFLU (LEXAL LABORATORIES CHAPTER) AND THE COURT OF INDUSTRIAL RELAT…

Condensed, the question before us is this:  Are per diems included in backpay?  This
problem came about because of the implementation of the decision of the Court
of Industrial Relations (CIR) of June 29, 1963^[1]
directing petitioner Lexal Laboratories (Lexal) to
reinstate Guillermo Ponseca, a dismissed employee, to
his former position “with full back wages from the day of his dismissal up
to the time he is actually reinstated without loss of his seniority rights and
of such other rights and privileges enjoyed by him prior to his lay-off”.

CIR, confirming the report of its Chief Examiner and Economist,
ruled in its order of February 16, 1965 that Ponseca
was entitled to back wages from November 5, 1958 when he ceased reporting for
work, to November 24, 1963 a day prior to his reinstatement on November 25,
1963; and that for the number of days that he was supposed to be in Manila, he
was to earn P4.50 a day, and during the periods when he should have been in the
provinces, P4.50 a day plus a per diem of P4.00 or a total of
P8.50 daily.  This order was subsequently
modified by CIR’s resolution of May 22, 1965 which directed the deduction of
P5,000.00 previously paid Ponseca under the judgment
and P610.00 which Ponseca earned from other sources
during his layoff.

Petitioners vigorously objected to the inclusion of the P4.00 per
diem in the computation of Ponseca’s back
wages because the latter “did not actually spend
for his meals and lodgings for he was all the time in Manila,
his station”.  CIR brushed this
contention aside.  Whereupon, petitioners
appealed to this Court from the order of February 16, 1965 and the resolution of May 22, 1965.^[2]

1.  Our attention has not
been drawn to a rule of law or jurisprudence which holds that per diems
are integral parts of regular wages or salaries.  Neither is it suggested in the record that per
diems formed part of the terms of employment between petitioners and
respondent union (of which Ponseca is a member), or
with Ponseca himself for that matter.  Nor was pronouncement made either in the
original decision or in the questioned order and resolution of CIR that per
diems are part of back wages.  CIR
simply hit upon the idea that per diems should be paid as part of
the back wages because they were “paid to him regularly”.

Per diem, the dictionary definition tells us, is
“a daily allowance” given “for each day he [an officer or employee] was away from his home base”.^[3]  It would seem to us that per diem is intended to cover the cost of
lodging and subsistence of officers and employees when the latter are on duty
outside of their permanent station.^[4]
Lexal concedes that whenever its employee, Guillermo Ponseca, was out of Manila,
he was allowed a per diem of P4.00 broken down as follows:  P1.00 for breakfast; P1.00 for lunch; P1.00
for dinner; and P1.00 for lodging.  Ponseca – during the period involved – did not leave Manila.  Therefore, he spent nothing for meals and
lodging outside of Manila.  Because he spent nothing, there is nothing to
be reimbursed.  Since per diems
are in the nature of reimbursement, Ponseca should
not be entitled to per diems.

Besides, back wages are what an employee has lost “in the
way of wages” due to his dismissal. 
So that, because Ponseca earned P4.50 a day,
“then that is the amount which he
lost daily by reason of his dismissal, nothing more nothing
less“.^[5]

We, accordingly, rule
that CIR erred in including per diems in the back wages due and
payable to Guillermo Ponseca.

2.  The rest is a matter of
mathematical computation.  But first to the
facts.  The union’s evidence is that
since the last part of October, 1958 Ponseca had been
reporting everyday to the bodega of respondents.^[6]  Anyway, prior to Ponseca’s
dismissal, he worked daily either in Manila
or in the provinces.^[7]

But
the order of February
15, 1965 credits Ponseca with 1,856 days
for the period from November 5, 1958 to November 24, 1963.  We
checked the accuracy of this figure.  We
found that there should only be 1,846 days from November 5, 1958 to November 24, 1963, viz:

This brings us to the total amount due from Lexal
to Guillermo Ponseca, as follows:

For the foregoing reasons, the order of February 16, 1965 and
the resolution of May 22, 1965, both of the Court of Industrial Relations, in
its Case No. 2002-ULP, entitled “National Chemical Industries Workers
Union-PAFLU (Lexal Laboratories Chapter),
Complainant, versus Lexal Laboratories and Jose
Angeles, its Manager, Respondents”,
are hereby modified; and

Judgment is hereby rendered ordering petitioner Lexal Laboratories to pay Guillermo Ponseca,
by way of net backpay, the sum of P2,697.00.

No costs.

SO ORDERED.

Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Castro, Angeles,
Fernando, and Capistrano, JJ., concur.

Zaldivar,
J., on leave.

^[1]
CIR Case No. 2002-ULP, entitled “National Chemical Industries Workers
Union-PAFLU (Lexal Laboratories Chapter),
Complainant, versus Lexal Laboratories and Jose Angeles, its Manager, Respondents”.

^[2]
CIR Record, p. 257.

^[3]
Webster’s Third New International Dictionary [1964], p. 1676.

^[4]
Cf. Republic Act 3847; General Order Circulars Nos. 88 and 88-A;
Executive Order No. 38, series of 1917, XV Gaceta Oficial, p. 811.

^[5]
Donato vs. Philippine Marine Officers
Association, L-12506, May 18, 1959, citing United Employees Welfare Association
vs. Isaac Peral Bowling Alleys, L-10327,
September 30, 1958, and C.E. Church vs. La Union Labor Union, L-4393, April
28, 1952; underscoring ours.

^[6]
Printed Decision, Appendix A of petitioners’ brief, p. 10-A.

^[7]
Examiner’s Report, CIR Record, pp. 171-172.

^[8]
The amounts of P5,000.00 and P610.00 were ordered deducted from the backpay pursuant to
the CIR’s resolution of May 22, 1965.