Week 6 - Leaves Flashcards
Who are entitled to service incentive leaves?
Every employee who has rendered at least one year of service shall be entitled to a yearly service incentive leave of five days with pay. [Labor Code. Art. 95. (a).].
Who are exempted from the application of the Right to Service Incentive Leave under Art. 95 of the Labor Code?
The provision shall not apply to:
- Those who are already enjoying the benefit herein provided;
- Those enjoying vacation leave with pay of at least five days; and
- Those employed in establishment regularly employing less than ten employees; or
- Those employed in establishments exempted from granting this benefit by the Secretary of Labor and Employment after considering the viability or financial condition of such establishment. [Labor Code. Art. 95. (b).].
What shall the term “at least one-year of service” mean when computing service incentive leaves?
The term “at least one-year service” shall mean service for not less than 12 months, whether continuous or broken reckoned from the date the employee started working, including authorized absences and paid regular holidays unless the working days in the establishment, as a matter of practice or policy, or that provided in the employment contract is less than 12 months, in which case said period shall be considered as one year. [IRR Book III Rule V Sec. 3]
Book III. Rule V. Sec. 5. Treatment of Benefit. – The service incentive leave shall be […] if not used or exhausted at the end of the year.
Book III. Rule V. Sec. 5. Treatment of Benefit. – The service incentive leave shall be commutable to its money equivalent if not used or exhausted at the end of the year.
In cases of illegal dismissal, up to when should service incentive leaves pay be computed?
“[s]ince a service incentive leave is clearly demandable after one year of service – whether continuous or broken – or its equivalent period, and it is one of the ‘benefits’ which would have accrued if an employee was not otherwise illegally dismissed, it is fair and legal that its; computation should be up to the date of reinstatement as provided under Section [Article] 279 of the Labor Code, as amended:
Art. 279. Security of Tenure. – An employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation is withheld from him up to the time of his actual reinstatement.” [Imbuido v NLRC GR No. 114734.].
Are employees paid on commission basis exempted from service incentive leaves?
Not necessarily. If the employee is still a regular employee but paid on a purely commission, he or she may be granted service incentive leaves. If the employee is a field personnel, or falls under the exceptions provided under Art. 82, then he or she is not entitled to service incentive leaves. Thus, the Court held in Autobus: “[P]etitioner’s contention that respondent is not entitled to the grant of service incentive leave just because he was paid on purely commission basis is misplaced. What must be ascertained in order to resolve the issue of propriety of the grant of service incentive leave to respondent is whether or not he is a field personnel.” [Autobus Transport System v. Bautista GR No. 256367].
When will the cause of action of an entitled employee to claim his service incentive leave pay accure?
“The cause of action of an entitled employee to claim his service incentive leave pay accrues from the moment the employer refuses to remunerate its monetary equivalent if the employee did not make use of said leave credits but instead chose to avail of its commutation.” i.e. “from the time when the employer refuses to pay its monetary equivalent after demand of commutation or upon termination of the employee’s services, as the case may be.” [Autobus Transport System v. Bautista GR No. 256367].
Can the employer impose conditions on the grant of sick and vacation leaves?
Yes. Jurisprudence has held “In the grant of [sick and] vacation leave privileges to an employee, the employer is given the leeway to impose conditions on the entitlement to and commutation of the same, as the grant of [sick and] vacation leave is not a standard of law, but a prerogative of management. It is a mere concession or oact of grace of the employer and not a matter of right on the part of the employee. Thus, it is well within the power and authority of the employer to impose certain conditions, as it deems fit, on the grant of vacation leaves, such as having the option to schedule the same.” [PSTMSDWO v. PNCC Skyway GR No. 171231; also cited in Sugue v. Triumph International GR No. 164804].
