Philippine Duplicators Inc v.

NLRC and Union

Facts:
The Third Division of the Supreme Court upheld the decision of the NLRC directing Duplicators
to pay the Employees (Union) 13 th month pay on the basis of their Fixed Salaries plus SALES
COMMISSION and dismissing Duplicators MR. On January 17, 1994, Duplicators filed for
Leave to file a Second MR and Second MR contending that the Bole-Takeda effectively
abandoned and reversed the Duplicators case when it declared Null and Void the second
paragraph of Section 5 (a) of the Revised Guidelines issued by Secretary of Labor Drilon as such
Duplicators pray that the decision rendered in Duplicators be set aside and another entered
dismissing the Money Claims of Union.

ISSUE:
W/N Sales commission shall be included in the computation of 13 th month pay? YES

HELD:
The Court stated that the Sales Commission in Duplicators is different from the Commission in
Bole-Takeda. That in Duplicators Sales Commission are those earned by salesman who make or
close a sale of duplicating machines distributed by Duplicators that it constitutes part of the
compensation or remuneration paid to the salesman, and hence forms part of the “wage” or
salary of salesman.

That Sales Commission were an integral part of the basic salary structure of Duplicators
Employees Salesman; these are not overtime payments, nor profit sharing scheme nor any
other fringe benefit. Thus they form part of the “ Basic Salary ” for purposes of computing 13
th month pay.

Medical Representatives in Boie-Takeda are not the same as Salesmen in Duplicators. They do
not affect any sale of article, but merely promote such products. In Bole-Takeda the so called
commissions paid to or received by the medical representatives are not included in “Basic
Salary” for purposes of computing 13th month pay because they are in fact Productivity
Bonuses which are tied to the capacity of revenue production of the corporation and closely
resembles Profit Sharing Schemes there being no clear necessary relation to the amount of
work done by each individual employee.

In this Case the Sales Commission are intimately related to or directly proportional to the
extent or energy of an employees endeavors . While in Productivity Bonuses, it is NOT
intimately related to or directly proportional to the extent or energy of an employees endeavors
but is generally tied to the productivity or profit generation of the employer corporation