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106 Phil. 696

[ G. R. No. L-12950, December 09, 1959 ]




This is  a  petition  by Benjamin Celestial and 175  others for review of the decision of the Auditor General, dated September 9, 1957,  denying their  claim for  differential pay under the Minimum  Wage Law.

The  record  discloses  that petitioners  are  employees and/or workers of the Southern  Mindanao  Experimental Station,  later referred to as Experimental Station, Bureau of Plant Industry in Davao City, and that since 1952, they had been paid each a daily wage of P2.50; that some time in March 1957, petitioners filed with the Auditor General's Office their  claims for  differential pay,  alleging  among other things that they were entitled to the minimum wage of P4.00 a day,  instead of P2.50, which  was  actually paid them by  the Experimental  Station;  and that  as already stated, on September 9,  1957,  the Auditor  General rendered a decision, holding that petitioners were not entitled to the minimum daily wage of P4.00, but only to P2.50.

The resolution of this case depends upon the interpretation and application of Section 3(a),  (b)  and  (c)  of the Minimum  Wage  Law,  which  we  reproduce  below  for purposes of  ready reference:
"SEC. 3. Minimum wage. (a) Every employer  shall  pay  to each of his employees who is employed by an  enterprise other than in agriculture wages at the rate  of not less than

 (1) * * *

(2) Three pesos a day on the effective date of this Act and for one  year after the effective date,  and thereafter P4.00 a day, for employees of establishments  located outside of  Manila or its environs:  *  *  *.

(b) Every employer who operates a farm enterprise comprising more than  12  hectares shall  pay each of his employees  who is engaged in agriculture, wages at  the rate of not less than

(1) ******,
(2) ******;
(3) One year thereafter, P2.50 a day and no allowances for board and  lodging shall reduce this wage below P2.25 in cash.

(c) Effective on the first  of July, nineteen hundred and fifty-two, the minimum wage rates for employees in the Government service shall be those provided in subsections  (a) and (b)  of this section *  * *."
From the legal  provisions above-reproduced, it will readily be seen that in order that an employee or laborer may be paid the minimum wage  of P2.50 a day, he must be employed by an enterprise (in  this case, the Southern Mindanao Experimental Station)  engaged in agriculture; that said employer operates a  farm  comprising more than 12 hectares; and  that  the  employee or laborer  is  engaged in agriculture.   The second condition is satisfied because the Experimental Station is operating a farm comprising 960 hectares.   The  next question  to be decided is whether or not said Experimental Station  is  engaged  in  agriculture. To determine this, we have to go back to the functions of the Bureau of Plant Industry  (Section 1753, Revised Administrative Code) of which the Experimental Station is an agency  or  adjunct, said  Experimental Station  being provided for in Section 1754 of the same  Revised Administrative Code. Said two  sections are reproduced below for ready reference:
"SEC. 1753. Functions of Bureau of Plant  Industry. It shall be the function of said Bureau to collect and disseminate useful  information pertaining to agriculture in the Philippines, to encourage the use  of  improved  agricultural methods; and, in  general,  to promote the development of the agricultural resources of the Philippines, as follows:

(a) By  the introduction of new  domesticated animals, and the improvement  of  the breeds  of  domesticated animals now found in the  Philippines;
(b) By the control and  eradication of diseases of live  stock;
(c) By the investigation of soil and climate conditions, and the methods  of  producing  and handling agricultural products;
(d) By  the  introduction,  production,  and  distribution of improved seeds  and plants;
(e) By the control and eradication of  diseases, insects, and other pests injurious to cultivated plants;
(f) By the  operation of  a system of demonstration and agricultural extension work;
(g) By the collection of agricultural  statistics; and
(h) By the  publication and distribution of bulletins, circulars, and other printed matter."

"Sec. 1754. Experiment stations, farms, and stations for agricultural instruction. In  such  places in the  Philippines as may  be considered suitable for the purpose, the Director of Plant Industry, with the  approval of the  Head of the Department, shall, as  funds shall be available  therefore, establish, equip, maintain, and operate experiment stations,  farms,  stock farms,  and stations for practical agricultural instruction.

"(In the Bureau  of  Agriculture is also  vested the  supervision and control of  American agricultural  colonies)."
On  the basis  of the legal provisions  above-reproduced, we are of the opinion that both the Bureau  of Plant Industry and  Experimental  Station, particularly the latter, are engaged in agriculture  or are  dedicated  to  agricultural functions, specially  when we  take into  consideration the definition of  agriculture in  Section  2  of  the Minimum Wage  Law  itself,  Republic Act No.  602,  which  is as follows:
" 'Agriculture' includes farming in all its  branches and among other things include the cultivation and tillage of the soil, dairying, the production, cultivation, growing, and harvesting of any agricultural or  horticultural commodities, the  raising  of livestock or poultry, and any practices performed by a farmer or on a  farm as an incident  to or  in conjunction  with such farming operations, but does  not include  the manufacturing or processing of sugar, coconuts,  abaca, tobacco, pineapples  or other farm  products."
And it is a matter of public knowledge that experimental stations maintained by the Bureau  of  Plant Industry, specially when done on  a big scale like the Southern Mindanao Experimental Station that  operates  a  farm comprising 960 hectares, through its employees  and laborers, actually till the soil, introduce and plant seeds of the  best crop varieties found by it after study and experiment, raise said  crops in the  best approved methods of cultivation, including the spacing of each plant or seedling  and the amount of water needed through irrigation, weeding, etc., and the  proper harvesting of the crop,  including the timing and method, all for the  instruction and benefit of Philippine farmers, and to foster, agriculture in the country.   Included in this cultivation is  the discovery of plant pests and  their  eradication by  means of treatment with the proper insecticides.   Thereafter, from the harvest are extracted  the seeds which are  called certified seeds, for sale and distribution to farmers.   There  can be no question that all  these  acts and functions fall within the definition  of agriculture  provided in  the Minimum  Wage Law and,  consequently,  are agricultural as  distinguished from non-agricultural functions.  It  follows that  the laborers and farm workers who actually  carry out  and perform these functions are also engaged in agriculture.  It is possible that  not  all the laborers and  employees in the Experimental Station are actually engaged in preparing the  land for planting, such as plowing, tilling,  and planting the seeds or seedlings, in weeding the farm,  in treating plant diseases and harvesting crops.   Some employees may be  engaged  in. office work,  such  as, clerks, supervisors,  maintenance  workers, etc.  But inasmuch  as they are all  employed by the Experimental  Station, which is a farm enterprise, and  their work is incidental to agriculture, they may also be  considered as agricultural workers and employees.  Interpretative Bulletin No. 14, issued by the United States Wage Administration  Service, implementing the provisions of the  Fair  Labor  Standards Act of the United  States  of  1938,  from  which our Minimum Wage Law was copied (Morave: Minimum Wage Law,  p. 279), under  the  title "Office Workers, Etc.," says:
"Office  Workers, Etc.

"12. We have received inquiries concerning office  help secretaries, clerks,  bookkeepers, etc., night watchmen, maintenance  workers, engineers, etc., who are employed by a farmer or a  farm in connection with the activities described  in the definition of 'agriculture' contained in  section  3  (/).  In our  opinion such employees  are exempt."  (Teller:  Labor Disputes and Collective  Bargaining, Vol. II, p.  1209)
The above-reproduced portion  of the bulletin,  applied  in this jurisdiction,  means  that  the  employees  mentioned therein are not governed  by our Minimum  Wage Law,  as regards the  minimum wage of P4.00 a day for non-agricultural workers; consequently, they may receive  only the minimum wage  of P2.50  a day, prescribed for  workers engaged in agriculture.

But petitioners contend that the Bureau of Plant Industry and the Experimental Station  could  not be  engaged in agriculture for the reason that their farm enterprise is not for profit.   In answer to this contention, it is enough to say that  Minimum Wage Law in defining agriculture, does not prescribe the condition that the  person or entity is engaged in it for purposes of profit.  We can well imagine a person interested in research and scientific agriculture who proceeds to cultivate a little farm of, say, one or two hectares,  to put into practice the results of his research, introducing in the cultivation the most modern methods, the most suitable fertilizers, etc., so that a hectare so cultivated can produce, say, from 250 to 300 cavans of palay and incidentally to compete for a prize or a medal offered by the Government or any of its  agencies.  The fact  that he does not cultivate the  farm for  purposes i of profit,  but rather in the interest of science and to prove his scientific and  agricultural theories,  and  incidentally enter the contest  for  a prize,  does not  make him less agriculturist and  his activities  as agriculture.

Incidentally, it may be stated that the Secretary of Justice in an opinion rendered in connection with the different activities of the Davao Regional Fiber Station, holds that the  laborers and  employees  of said fiber  experimental station  are not entitled to the  minimum wage of  P4.00.

In  view of the foregoing, the decision  appealed from is hereby  affirmed.  No costs.

Paras, C.  J.,  Bengzon, Padilla,  Bautista  Angelo, Labrador,  Reyes,  J.  B.  L., Endencia,  Barrera,  and  Gutierrez David,  JJ., concur.