Wages Flashcards
What is the definition of ‘wages’?
Employee’s wage has been defined as “remuneration of earnings, however designated, capable of being expressed in terms of money, whether fixed or ascertained on a time, task, piece, or commission basis, or other method of calculating the same, which is payable by an employer to an employee under a written or unwritten contract of employment for work done or to be done, or for services rendered or to be rendered and includes the fair and reasonable value, as determined by the Secretary of Labor and Employment, of board, lodging, or other facilities customarily furnished by the employer to the employee.
Differentiate wages and salary.
Wage is paid to skilled or unskilled manual laborers.
Wages are NOT subject to execution, garnishment or attachment except for debts related to necessities.
Salary is paid to white collar workers and denotes a higher grade of employment.
Salary is subject to execution, garnishment or attachment.
Is the distinction between wages and salary important?
In practice, the distinction appears to be merely semantics. Wages and salary can be interchanged.
The distinction between wage and salary in GAA vs CA was for the purpose of Article 1708 of the Civil Code (pertaining to execution, garnishment, or attachment; can get your money into custody to reward it to the winning party).
What are the three characteristics of Facilities?
- They are items of expense necessary for the laborer’s and his family’s existence and subsistence.
- They form part of the wage and when furnished by the employer are deductible from the wage, since if they are not so furnished, the laborer would spend and pay for them just the same.
- They are primarily for the benefit of the employee and his family for their existence and subsistence.
What are the characteristics of Supplements?
- They are extra remuneration or special privileges or benefits given to or received by the laborers over and above their ordinary earnings or wages.
- They are not deductible from their wages.
- They are primarily for the benefit or convenience of the employer.
What is the purpose test?
It is used in determining whether a privilege is a facility or supplement.
The criterion is not so much its kind but the purpose for which it is given by the employer.
When is a benefit/privilege to the employee considered a supplement or facility?
Under the PURPOSE TEST,
- if a benefit or privilege granted to the employee is clearly for the employer’s CONVENIENCE, then it will not be considered as a facility but a SUPPLEMENT.
- if a benefit or privilege granted to the employee is clearly for the employee’s BENEFIT, then it shall be considered a FACILITY.
What are the criteria for for facilities to be deducted?
- Proof must be shown that such facilities are customarily furnished by the trade.
- The provision of deductible facilities must be voluntarily accepted in writing by the employee
- The facilities must be charged at fair and reasonable value.
What are the two attributes of wages?
- Cash Wage
- Facilities
What is basic wage?
All remuneration or earnings paid by an employer to a worker for services rendered on normal working days and hours.
It does not include cost-of-living allowances, profit sharing payments, premium payments, 13th month pay or other monetary benefits which are not considered as part of or integrated into the regular salary of the workers.
What is the statutory minimum wage?
It is the lowest wage fixed by law that an employer can pay his worker.
The payment of statutory minimum wage is MANDATORY.
The statutory minimum wage shall be based on the normal working hours, which shall not exceed eight hours work a day.
All workers paid by results, including those who are paid on piecework, takay, pakyaw, or task basis are also entitled to the applicable statutory minimum wage.
What are the four principles discussed in the section on wages?
- No work, no pay.
- Equal pay for equal work.
- Fair wage for fair work.
- Non-diminution of benefits.
Explain the principle of “No Work, No Pay”.
If there is no work performed by the employee, there can be no wage or pay.
Unless the laborer was able, willing and ready to work but was prevented by management or was illegally locked out, suspended or dismissed.
Explain the principle of “Equal Pay for Equal Work”.
Persons who work with substantially equal qualifications, skill, effort and responsibility, under similar conditions, should be paid similar salaries.
If an employer accords employees the same position and rank, the presumption is that these employees perform equal work.
Explain the principle of “Fair Wage for Fair Work”.
Wages are compensation for work rendered, and where no work is done, as a general rule, no compensation is due,
UNLESS the laborer was able, willing, and ready to work but was illegally locked out, suspended, or dismissed, or otherwise illegally prevented from working.
Explain the principle of “Non-Diminution of Benefits”.
Employers are prohibited from eliminating or reducing the benefits already enjoyed by their employees .
What are the requisites for there to be diminution of benefits?
- The grant or benefit is founded on a policy or has ripened into a practice over a long period of time
- The practice is consistent and deliberate
- The practice is not due to error in the construction or application of a doubtful or difficult question of law; and
- The diminution or discontinuance is done unilaterally by the employer.
