Labor laws are important in the corporate culture. Labor being in a disadvantaged position as compared to capital, the same is entitled to protection as provided for under the constitution and other labor and related laws. In fact, it is a policy of the state that any doubt in the interpretation and implementation of labor and related laws, as between labor and capital, the former shall be preferred.
Part of employee benefits is the employee’s benefit plan. This is one whereby employees are justly compensated or paid several benefits after their termination of employment. More often than not, employee’s benefit plan are part of the perks and benefits which the employees are entitled to as a matter of right. In this regard, where the employee is terminated giving him a right to such employee benefit plan, liability on the part of the employer to pay the same arises and the demandability accrues as a matter of right.
Reorganization, at times results to severance of employer-employee relationship. Termination of employment, if done in accordance with law and pursuant to a valid reorganization there being no compelling factor from the employee, may still entitle the latter to the employee’s benefit plan. The employee’s benefit plan is demandable as a matter of right on the part of the employees. In the same way, where transfer of interest is already effected, and the employer-employee relationship of an employee is severed, the employee is entitle to the same. The employer cannot be allowed to deny liability where to do so would impair a right of an employee which has already been vested at the inception of the employment contract except in certain limited compelling circumstances. In the absence of any averment to the contrary, the liability of the employer accrues and the employee may demand the same as a matter of right.
Where a right has already been vested and the employee is entitled to it as a matter of right, the employer is not allowed to modify the provisions in an employee’s benefit plan where to do so would impair a vested right. The liability has accrued in favor of the employee and the same entitles protection from the state and the employer can not be allowed to deny the same.
On the other hand, with respect to overtime pay, Ursula, an administrative employee is entitled to overtime for work performed beyond the normal 40-hour work week.
It has been opined that in the prior case of Tift, employees who work beyond the normal 40-hour work week are entitled to an overtime pay. The basis of this is the decision in the case of Tift vs. Professional Nursing Servs. It can be noted however that the decision in this case was rendered in 1995. In a related case involving Boeing employees who are likewise demanding for payment for overtime pay, the decision in the case of Tift came only in 1995. The services of the employees rendered beyond the normal 40-hour work week before the promulgation of the Tift decision were made without an expectation of compensation as overtime pay, thus, they are not entitled to an overtime pay.
It is relevant to discuss at this point, the entitlement of the employees to overtime pay. Under the law, administrative employees, among others, are not entitled to overtime pay. The definition of what is an administrative employee however has not been provided by law and the Secretary of Labor is given the wide discretion of providing such definition. It can be noted that the basis of this provision is the fact that they are entitled to salary basis. It is opined by the court that this has been looked with disfavor on its part, being the sole discretion of the Secretary of Labor. That is, the fact that the employees are receiving salary or the salary-basis principle does not outrightly exempt them from the payment of an overtime pay. In this regard, they are entitled to an overtime pay at whatever basis such for instance the ‘flat sum’, ‘straight time’ or anything as would benefit the employees and would fully compensate their performance in the workplace.
The ‘salary-based’ principle as a basis for exemption is not inconsistent with an employee’s entitlement to overtime pay, the basis of the latter being of whatever mode and whatever kind. Ursula, an administrative employee, is on this basis entitled to overtime pay.
The discussion should not end here in the light of the case decided involving the employees of Boeing (Boykin, et al vs. Boeing Company (128 F.3d 1279). The latter are denied of overtime pay considering that at the time the services are rendered, they are not expecting to be compensated, the Tift decision having came out later.
From this, it can be implied from this that where an employee is expecting to be paid an overtime pay for services rendered beyond the normal 40-hour work week, he is entitled to an overtime pay. In the case of Ursula, she has been receiving salary at the rate of straight time for services performed beyond the normal 40-hour work week. This can be likened to a practice and gives rise to a vested right theory. The above-mentioned doctrine therefore does not apply in the case of Ursula. She has been receiving overtime compensation and therefore acquires a vested right thereto as time elapses, and is therefore entitled to it upon the termination of her employment.
Employee’s benefit plan and overtime pay are benefits given to employees as forms of protecting labor vis a vis capital. Pursuant to the principle that in case of doubt in the implementation and interpretation of labor and related laws, the same shall be resolved in favor of labor. It is humbly opined that both the benefit plan and overtime compensation be given to the employees.