[219] PHIL. DUPLICATORS v.

NLRC additional services are rendered by any particular employee and

G.R. 110068; February 15, 1995; Feliciano, J. hence not legally demandable, absent a contractual undertaking to
pay it.
TOPIC:  Sales commissions are intimately related to or directly proportional
to the extent or energy of an employee's endeavors. Commissions
SUMMARY are paid upon the specific results achieved by a salesman-employee.
Private respondent union, for and on behalf of its member-salesmen, It is a percentage of the sales closed by a salesman and operates as
asked petitioner corporation for payment of 13th month pay an integral part of such salesman's basic pay.
computed on the basis of the salesmen’s fixed or guaranteed wages
plus commissions. Petitioner corporation refused the union’s ISSUE(S)/HELD
request, but stated it would respect an opinion from the MOLE. On WON sales commission is included in the coverage of basic salary for
17 November 1987, acting upon a request for opinion submitted by purposes of computing 13th month pay.
respondent union, Director Augusto G. Sanchez of the Bureau of DECISION (1993)
Working Conditions, MOLE, rendered an opinion to respondent  In the first place, Article 97 (f) of the Labor Code defines the term
union declaring applicable the provisions of Explanatory Bulletin No. “wage” (which is equivalent to “salary,” as used in P.D. No. 851 and
86-12, Item No. 5 (a): Memorandum Order No. 28) in the following terms:
Since the salesmen of Philippine Duplicators are receiving
a fixed basic wage plus commission on sales and not purely  (f) “Wage“ paid to any employee shall mean the remuneration or
on commission basis, they are entitled to receive 13th earnings, however designated, capable of being expressed in terms
month pay provided they worked at least one (1) month of money, whether fixed or ascertained on a time, task, piece, or
during the calendar year. May we add at this point that in commission basis, or other method of calculating the same, which is
computing such 13th month pay, the total commissions of payable by an employer to an employee under a written or unwritten
said salesmen for the calendar year shall be divided by contract of employment for work done or to be done, or for services
twelve (12). rendered or to be rendered, and includes the fair and reasonable
Notwithstanding Director Sanchez’ opinion or ruling, petitioner value, as determined by the Secretary of Labor, of board, lodging, or
refused to pay the claims of its salesmen for 13th month pay other facilities customarily furnished by the employer to the
computed on the basis of both fixed wage plus sales commissions. employee. “Fair and reasonable value” shall not include any profit to
the employer or to any person affiliated with the employer.
DOCTRINE  In the instant case, there is no question that the sales commissions
earned by salesmen who make or close a sale of duplicating
RELEVANT PROVISION(S) machines distributed by petitioner corporation constitute part of the
compensation or remuneration paid to salesmen for serving as
FACTS salesmen, and hence as part of the “wage” or “salary” of petitioner’s
NOTE: the case is very procedurally technical; walang facts, nasa ratio salesmen.
na. o Indeed, it appears that petitioner pays its salesmen a small
 The case differentiates between Productivity Bonuses vs. fixed or guaranteed wage; the greater part of the
Commissions. salesmen’s wages or salaries being composed of the sales
 Productivity bonuses are generally tied to the productivity or profit or incentive commissions earned on actual sales closed by
generation of the employer corporation. Productivity bonuses are not them.
directly dependent on the extent an individual employee exerts o No doubt this particular salary structure was intended for
himself. A productivity bonus is something extra for which no specific the benefit of petitioner corporation, on the apparent
 assumption that thereby its salesmen would be moved to
greater enterprise and diligence and close more sales in the
expectation of increasing their sales commissions.
o This, however, does not detract from the character of such
commissions as part of the salary or wage paid to each of
its salesmen for rendering services to petitioner corporation.
 Petition and MR dismissed
RESOLUTION (1995)
 In Boie-Takeda, the so-called commissions “paid to or received by
medical representatives of Boie-Takeda Chemicals or by the rank
and file employees of Philippine Fuji Xerox Co.,” were excluded from
the term “basic salary” because these were paid to the medical
representatives and rank-and-file employees as “productivity
bonuses.”
 The Second Division characterized these payments as additional
monetary benefits not properly included in the term “basic salary” in
computing their 13th month pay.
o As a rule, a bonus is an amount granted and paid to an
employee for his industry loyalty which contributed to the
success of the employer’s business and made possible the
realization of profits.
o It is an act of generosity of the employer for which the
employee ought to be thankful and grateful. It is also
granted by an enlightened employer to spur the employee
to greater efforts for the success of the business and
realization of bigger profits.
o From the legal point of view, a bonus is not and demandable
and enforceable obligation. It is so when It is made part of
the wage or salary or compensation.
 2nd MR dismissed.

RULING

DISPOSITIVE: