G.R. No. 202961, February 04, 2015 EMER MILAN, RANDY MASANGKAY, MASANGKAY, WILFRED !A ! A"IER, RNALD DA"ID, #NIFA$I MA%&NDAN, NRA MEND'A, E% AL. , Petitioners Petitioners,, v. NA% NA%INAL INAL LA#R L A#R RELA%INS $MMISSIN, SLID MILLS, IN$., AND(R )*ILI) ANG , Respondents Respondents.. DE$ISIN LENEN,
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A e-/oyer a//oe3 o o/3 er-a/ ay a3 bee e37 e e-/oyee8 reur o roere. As Solid Mills’ Mills’ employees, employees, petitioners and their families families were allowed to to occupy SMI Village, Village, a property owned by Solid Mills. According to Solid Mills, Mills, this was “[out of liberality and for the con!enience of its employees . . . [and on the condition that the employees . . . would !acate the premises anytime the "ompany deems fit.# In September $%%&, petitioners were informed that effecti!e 'ctober (%, $%%&, Solid Mills would cease its operations due to serious business losses. losses. )A*+ recogni-ed Solid Solid Mills’ closure due to serious business losses in the memorandum memorandum of agreement dated September (, $%%&. $%%&. he memorandum of agreement pro!ided for Solid Mills’ grant of separation pay less accountabilities, accrued sic/ lea!e benefits, !acation lea!e benefits, and (&th month pay to the employees. +ater, Solid Mills, through Alfredo Alfredo 0ingco, sent to petitioners indi!idual notices to !acate SMI Village.chanrobles!irtuallawlibrary Village. chanrobles!irtuallawlibrary 1etitioners were no longer allowed allowed to report for wor/ by 'ctober 'ctober (%, $%%&. hey were re2uired to sign a memorandum of agreement with release and 2uitclaim before their !acation and sic/ lea!e benefits, (&th month pay, pay, and separation pay would would be released. 3mployees who signed the memorandum of agreement were considered to h a!e agreed to !acate SMI Village, and to the demolition of the constructed houses inside as condition for the release of their termination benefits and separation pay. pay. 1etitioners refused refused to sign the documents and demanded to be paid their benefits and separation pay.chanrobles!irtuallawlibrary pay.chanrobles!irtuallawlibrary 4ence, petitioners filed complaints before the +abor Arbiter for alleged non5payment of separation pay, accrued sic/ and !acation lea!es, and (&th month pay. pay. hey argued that their accrued accrued benefits and separation pay should not be withheld because their payment is based on company policy and practice. Moreo!er, the the (&th month pay is based on law, specifically, specifically, 1residential 6ecree )o. 78(. %er oeo o So/3 M// roery o a aouab/y a ub:e o /earae roe3ure roe3ure.. hey had already turned o!er to Solid Solid Mills their uniforms uniforms and e2uipment when Solid Mills ceased operations. ISS&E+ 94343: ': )' 43 4')':A;+3 "': '* A113A+S "'MMI36 :3V3:SI;+3 3::': 943) 9 43) I :+36 4A 1A< 1A
*ELD+ :e2uiring clearance before the release of last payments to the employee is a standard procedure among employers, whether public or pri!ate. "learance procedures are instituted to ensure that the properties, real or personal, belonging to the employer but are in the possession of the separated employee, are returned to the employer before the employee’s departure. 'ur law supports the employers’ institution of clearance procedures before the release of wages. As an e>ception to the general rule that wages may not be withheld and benefits may not be diminished, the +abor "ode pro!ides?chan:obles!irtual+awlibrary Ar. 11;. Wa7e 3e3uo. )o employer, in his own behalf or in behalf of any person, shall ma/e any deduction from the wages of his employees, e>cept?chan:obles!irtual+awlibrary @@@@ 3. In cases where the employer is authorized by law or regulations issued by the Secretary of Labor and Employment. 3mphasis suppliedB he "i!il "ode pro!ides that the employer is authori-ed to withhold wages for debts due?chan:obles!irtual+awlibrary Article (C%D. 9ithholding of the wages, e>cept for a debt due, shall not be made by the employer.cralawred “6ebt# in this case refers to any obligation due from the employee to the employer. It includes any accountability that the employee may ha!e to the employer. here is no reason to limit its scope to uniforms and e2uipment, as petitioners would argue. More importantly, respondent Solid Mills and )A*+, the union representing petitioners, agreed that the release of petitioners’ benefits shall be “less accountabilities.# “Accountability,# in its ordinary sense, means obligation or debt. he ordinary meaning of the term “accountability# does not limit the definition of accountability to those incurred in the wor/site. As long as the debt or obligation was incurred by !irtue of the employer5employee relationship, generally, it shall be included in the employee’s accountabilities that are subEect to clearance procedures. he return of the property’s possession became an obligation or liability on the part of the employees when the employer5employee relationship ceased. hus, respondent Solid Mills has the right to withhold petitioners’ wages and benefits because of this e>isting debt or liability. he law does not sanction a situation where employees who do not e!en assert any claim o!er the employer’s property are allowed to ta/e all the benefits out of their employment while they simultaneously withhold possession of their employer’s property for no rightful reason. 9ithholding of payment by the employer does not mean that the employer may renege on its obligation to pay employees their wages, termination payments, and due benefits. he employees’ benefits are also not being reduced. It is only subEected to the condition that the employees return properties properly belonging to the employer. his is only consistent with the e2uitable principle that “no one shall be unEustly enriched or benefited at the e>pense of another.
