- Petitioner
- Boie-Takeda Chemicals, Inc.
- Respondent
- De la Serna
- Citation
- G.R. No. 92174 and G.R. No. 102552 (consolidated)
- Court
- Supreme Court
- Division
- Second Division
- Ponente
- Narvasa, C.J.
- Decided
- December 10, 1993
Whether sales commissions should be included in the computation of employees' thirteenth month pay under Presidential Decree No. 851
Summary
Two consolidated cases challenging Department of Labor orders requiring companies to include sales commissions in computing 13th month pay. Boie-Takeda Chemicals and Philippine Fuji Xerox argued that commissions are not part of 'basic salary' under Presidential Decree No. 851. Labor officials relied on revised guidelines issued by Secretary Drilon mandating inclusion of total earnings including commissions. The Supreme Court ruled for the companies, holding that 'basic salary' means standard work period pay exclusive of additional compensation like commissions. The Court declared the relevant portion of the revised guidelines null and void for exceeding statutory authority, emphasizing that implementing rules cannot expand the scope of the law they implement. The decision clarified that commissions are additional pay for extra efforts, distinct from basic salary for standard work periods.