Peñaranda vs. Baganga Plywood Corporation

G.R. No. 159577. May 3, 2006.


Charlito Peñaranda was an employee of Baganga Plywood Corporation (BPC) supervising the engineering section of the steam plant boiler. In 2001, Peñaranda filed a Complaint for illegal dismissal with money claims against BPC and its general manager, Hudson Chua, before the NLRC. He alleges that his services [were] terminated without the benefit of due process and valid grounds in accordance with law. Furthermore, he was not paid his overtime pay, premium pay for working during holidays/rest days, night shift differentials and finally claims for payment of damages and attorney’s

BPC allege that complainant’s separation from service was done pursuant to Art. 283 of the Labor Code. It was on temporary closure due to repair and general maintenance and it applied for clearance with the Department of Labor and Employment, to shut down and to dismiss employees. They also pay petitioner of separation. When BPC reopened failed to reapply hence, he was not terminated from employment much less illegally.

The labor arbiter ruled that there was no illegal dismissal since he was still employed by BPC. The labor arbiter found petitioner entitled to overtime pay, premium pay for working on rest days, and attorney’s fees.  NLRC, which deleted the award of overtime pay and premium pay for working on rest days because petitioner was not entitled to these awards because he was a managerial employee. CA dismissed Peñaranda’s Petition for Certiorari


Whether or not Peñaranda is entitled to overtime pay, premium pay for working on rest days.


Article 82 of the Labor Code exempts managerial employees from the coverage of labor standards. Labor standards provide the working conditions of employees, including entitlement to overtime pay and premium pay for working on rest days. Under this provision, managerial employees are “those whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision.”

The petitioner was not a managerial employee but a member of the managerial staff, which also takes him out of the coverage of labor standards. Like managerial employees, officers and members of the managerial staff are not entitled to the provisions of law on labor standards.

As supervisor, petitioner is deemed a member of the managerial staff.

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