DISPUTABLE PRESUMPTION OF PAYROLLS BEING ENTRIES IN THE COURSE OF BUSINESS IS OVERCOME BY IRREGULARITIES FOUND THEREIN

Disputable presumption that may be overthrown by clear and convincing evidence to the contrary.

Thus, the SC held in the following case

Ramiro Lim & Sons Agricultural Co., Inc., vs. Guilaran, et al.

G.R. No. 221967, February 6, 2019

Entries in the payroll; Disputable presumption of regularity; Entries in the course of business; Prima facie evidence; Prima facie evidence is not conclusive or absolute; Seasonal employees; Regular seasonal workers; Presumption on the length of work for seasonal employees; Minimum wage; In the absence of wage rates approved by the Secretary of Labor in accordance with the time and motion study the ordinary minimum wage rates are applicable to piece-rate workers

Facts:

Respondents Armando Guilaran, et al. alleged that they were agricultural workers of the Petitioners Ramiro Lim & Sons Agricultural Co., Inc., Sima Real Estate Development, Inc., and Ramiro Lim (RLSO, et al.), employed to work in all the agricultural stages of work on the 84-hectare hacienda owned by RLSO, et al..

Guilaran, et al. also alleged that they were paid on a mixed pakyaw and daily basis. Guilaran, et al. further alleged that they were illegally dismissed on 22 July 2000, when they asked to be paid based on the rates prescribed by the prevailing Wage Order.

RLSO, et al., on the other hand, argued that Guilaran, et al. -except Romeo Frias who was paid purely on a daily basis -were employed as laborers on a pakyaw basis. When their attention was called to the plan to conduct stricter measures to prevent wastage and production losses due to their half-hearted performance, Guilaran, et al. refused to return to work, paralyzing operations for about three weeks. Because of their unjustified absence even after show-cause notices, RLSO, et al. considered them to have abandoned their respective jobs.

The Labor Arbiter and the NLRC dismissed the complaints, ruling that Guilaran, et al. were considered to have abandoned their work in the hacienda.

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In the petition for certiorari filed before the CA, the CA granted in part the petition of Guilaran, et al., finding that RLSO, et al. failed to prove the existence of abandonment. Since the Guilaran, et al. have been performing services necessary and desirable to the business which are badges of regular employment, even though they did not work throughout the year and the employment depended on a specific season, the CA granted the reinstatement and payment of full backwages based on the latest Wage Order in the region, and the payment of attorney’s fees.

The case was remanded to the Labor Arbiter for the computation of back wages from 19 July 2000 up to the date of reinstatement. Meanwhile, RLSO, et al. filed a petition for review on certiorari to the SC but was denied for failure to sufficiently show any reversible error to warrant the exercise of its discretionary appellate jurisdiction. The Resolution of the SC denying the petition attained finality.

LA Ruling (on a Remanded Case):

The Labor Arbiter adopted the computation of the Fiscal Examiner who awarded to Guilaran, et al. their backwages in the amount of Five Million Fifty Eight Thousand Two Hundred Sixty Four Pesos and 64/100 (P.5,058,264.64).

The award for each of the Guilaran, et al. was uniform in character in the amount of P143,700.70, which was based on the mandated rates provided by law for the period from 2000 until December 2009, and was limited to six months of work per year, considering that sugarcane farming is  not continuous the whole year round.

RLSO, et al. filed a Memorandum of Appeal to the NLRC. They argued that the computation used by the Fiscal Examiner and approved by the Labor Arbiter was without basis in fact and in law as Guilaran, et al. barely and sparingly worked, and thus, are not entitled to the computation of six months pay per year.

NLRC Ruling:

The NLRC annulled and set aside the Order of the Labor Arbiter finding that the computation used was erroneous.

The NLRC upheld the validity of the Work Summary of Workers and the payrolls submitted by RLSO, et al., which showed that as pakyaw workers, Guilaran, et al., except Romeo Frias, did not observe the regular eight-hour work daily for the tasks given to them.

Thus, the NLRC ruled that the straight computation based on six months per year or 13 days per month could not be applied because this formula, as adopted by this Court in Philippine Tobacco Flue-Curing & Redrying Corporation vs. NLRC, requires that the service was rendered for at least six months in a given year. Based on the voluminous records submitted by the RLSO, et al., the NLRC found that not all of the Guilaran, et al. worked for at least six months in the last six years prior to their dismissal.

As to the argument of Guilaran, et al. questioning the authenticity and completeness of the payrolls submitted, the NLRC held that the payrolls, being entries in the course of business, enjoy the presumption of regularity under the Rules of Court. Moreover, the NLRC adopted the method used by RLSO, et al. to compute the amount of backwages due to the Guilaran, et al., which is to get the average monthly income of Guilaran, et al. based on the payrolls for the twelve-month period immediately preceding their dismissal, taking into consideration the Wage Orders prevailing during the period.

The NLRC further ruled that the computation should be made from July 2000 until the actual reinstatement of the Guilaran, et al..

The Motion for Reconsideration filed by Guilaran, et al. was denied by the NLRC. Thereafter, Guilaran, et al. filed a petition for certiorari under Rule 65 before the CA.

CA Ruling:

The CA reversed and set aside the Decision of the NLRC and reinstated the 29 March 2010 Order of the Labor Arbiter.

The CA found that the NLRC erred in relying on the payrolls presented by RLSO, et al. as these payrolls were self-serving, unreliable, and unsubstantial evidence. The inconsistencies in the signatures of Guilaran, et al. were so questionable to the naked eye that the CA found that its genuineness is doubtful.

Moreover, the signatures on the payrolls pertained to different or unknown persons who were not shown to be authorized. The CA also found the argument that Guilaran, et al. worked for only one hour a  day was hardly believable and contrary to human experience.

The CA denied the Motion for Partial Reconsideration filed by RLSO, et al.. Hence, the petition before the SC.

Issue/s:

Whether or not payrolls can be accorded presumption of regularity where there are allegations of forged signatures, inconsistencies in signatures, and that they were signed by unauthorized persons

Whether or not it can be presumed that in the absence of evidence to the contrary, seasonal workers in the sugarcane industry have worked for at least six months

Whether or not in the absence of duly approved time and motion study the ordinary minimum wage rates shall apply

SC Ruling:

The SC did not find merit in the petition.

The SC held that while it is true that entries in the payrolls enjoy the presumption of regularity, it is merely a disputable presumption that may be overthrown by clear and convincing evidence to the contrary.

Section 43 of Rule 143 of the Rules of Court provides:

Section 43. Entries in the course of business. -Entries made at, or near the time of transactions to which they refer, by a person deceased, or unable to testify, who was in a  position to know the facts therein stated, may be received as prima facie evidence, if such person made the entries in his professional capacity or in the performance of duty and in the ordinary or regular course of business or duty.

A presumption is merely an assumption of fact that the law requires to be made based on another fact or group of facts. It is an inference as to the existence of a  fact that is not actually known, but arises from its usual connection with another fact, or a  conjecture based on past experience as to what the ordinary human affairs take.

A presumption has the effect of shifting the burden of proof to the party who would be disadvantaged by a finding of the presumed fact. Moreover, prima facie evidence is defined as evidence which, if unexplained or uncontradicted, is sufficient to sustain a judgment in favor of the issue it supports, but which may be contradicted by other evidence.

Thus, prima facie evidence is not conclusive or absolute evidence to the contrary may be presented by the party disputing the assumption of fact made by inference of law and the court may validly consider such.

In this case, the inconsistencies in the signatures of Guilaran, et al. are so questionable to the naked eye that there exists doubt on their genuineness. Guilaran, et al. vehemently deny and refute the payrolls submitted as being incomplete, irregular, and forged. They allege that they were never given copies of these payrolls. The allegation that their signatures were forged or signed by unauthorized persons can hardly be overlooked. There were inconsistencies in the signatures and even signatures of unknown or unauthorized persons. The payrolls submitted were self-serving, unreliable, and unsubstantial.

Thus, while the payrolls in question enjoyed the presumption of regularity as entries made in the course of business, this presumption of regularity was effectively overthrown by evidence to the contrary.

The SC found Guilaran, et al. to be regular seasonal workers. The CA Decision considered all Guilaran, et al. regular seasonal workers, paid on a pakyaw basis, who were entitled to their backwages and reinstatement. Thus, the status of all the Guilaran, et al. has been settled with finality by the SC will no longer review the character of their employment.

The only issue to be determined, therefore, was the amount of backwages to be paid to Guilaran, et al. To determine the amount of backwages for piece-rate or pakyaw workers, there is a need to determine the varying degrees of production and days worked by each worker.

In Velasco vs. NLRC, the SC held that since the workers were paid on a piece-rate basis, there was a need for the NLRC to determine the varying degrees of production and the number of days worked by each worker.

In the present case, the NLRC relied on the payrolls submitted by RLSO, et al. to determine the amount of backwages. This was, however, reversed by the CA, which agreed with the Labor Arbiter who determined that Guilaran, et al. have been working for at least six months. We agree with the CA and the Labor Arbiter. It has been recognized by jurisprudence that the season of sugar cane industries lasts for periods of six to eight months. The payrolls submitted by the RLSO, et al. show that most of the Guilaran, et al. rendered service for less than one month per year. The submitted payrolls lacked credibility and their genuineness was doubtful.

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Moreover, as the presumption is that the season of sugar cane industries lasts for six to eight months, the burden was on the RLSO, et al. to prove otherwise. The evidence submitted by the RLSO, et al. failed to discharge this presumption. Thus, when the CA adopted the method used by the Labor Arbiter which granted Guilaran, et al.’s backwages based on the mandated rates provided by law for the period from 2000 to December 2009, and limited the computation of the amount to a period of six months of work per year, it was not baseless and arbitrary. This was based on applicable law and jurisprudence.

Article 124 of the Labor Code of the Philippines provides that all workers paid by result, including those who are paid on piecework, takay, pakyaw or task basis, shall receive not less than the prescribed wage rates per eight (8) hours of work a  day, or a proportion thereof for working less than eight (8) hours. Moreover, in Pulp and Paper, Inc. vs. NLRC, the Court held that in the absence of wage rates approved by the Secretary of Labor in accordance with the appropriate time and motion studies, the ordinary minimum wage rates are applicable to piece-rate workers.

Similarly, RLSO, et al. herein failed to adduce any evidence on the agreed amount of payment for work based on pakyaw basis, and whether such amount was determined and approved by the Secretary of Labor. Thus, the Labor Arbiter was correct in applying the minimum wage rates based on the applicable Wage Orders to determine the amount of backwages due to Guilaran, et al.. Consequently, we find that the amount awarded to Guilaran, et al. was not based on social justice but rather was in accordance with law.