Article 100 of the Labor Code: No elimination or reduction of benefits
Status: In force
What does Article 100 say?
Nothing in this Book shall be construed to eliminate or in any way diminish supplements, or other employee benefits being enjoyed at the time of promulgation of this Code.
Read the Labor Code on the DOLE website (it uses the article numbers before 2015)
What does it mean in plain language?
Article 100 of the Labor Code says the employer may not eliminate or reduce benefits that employees already enjoy. Courts call this the non-diminution of benefits rule. It protects a benefit only if it rests on a policy, a contract or a practice that the employer gave consistently and on purpose over a long time.
The article keeps the same number after the 2015 renumbering of the Labor Code.
How does it work in real life?
Weng: a rice allowance given for years
Weng's employer has given every rank-and-file employee a monthly rice allowance for many years, without a break. One day it announces that the allowance will stop. If the workers can show the grant was consistent and deliberate over a long period, it may have ripened into a company practice that Article 100 protects.
Oscar: a one-time bonus
After a very good year, Oscar's company gives a special bonus once and says it will not be repeated. The next year it gives nothing. A single grant is not "consistent" over a "significant period of time," so it is usually not a protected practice.
Tess: a change of work schedule
Tess's company moves the employees' rest day from Saturday to Sunday, with the same pay. Under the Coca-Cola ruling, a work schedule is not a monetary benefit, so the rule on non-diminution usually does not apply to the change itself.
What does this mean in practice?
- The worker usually has to show where the benefit comes from: the policy, the contract or the practice. Pay slips, memos and statements of co-workers can help.
- Benefits that a law itself requires, such as holiday pay or service incentive leave, are owed because of that law, not because of Article 100. See service incentive leave and the holiday pay rules.
- Article 100 is about benefits. Deductions from the wage itself are covered by Article 113.
- A claim for a benefit that was withheld is a money claim. It must be filed within three years from the time it accrued. See labor money claims prescription and how to file a labor complaint.
- Whether a practice exists is decided on evidence. If a benefit was cut, a lawyer, a union or the Public Attorney's Office can check the facts. See Free legal help in the Philippines.
- For an overview of the rules on pay, see wages, hours and pay under the Labor Code.
What does Article 100 say?
The article is one sentence:
Nothing in this Book shall be construed to eliminate or in any way diminish supplements, or other employee benefits being enjoyed at the time of promulgation of this Code.
"This Book" is Book Three of the Labor Code, on conditions of employment: wages, hours of work, rest days and holidays. "Supplements" are extra benefits on top of the basic wage.
Read alone, the sentence speaks of benefits enjoyed when the Code was promulgated in 1974. The Supreme Court reads it more broadly. In its decisions it applies Article 100 to benefits that employers grant today.
When is a benefit protected?
In Beltran v. AMA Computer College (2019), the Supreme Court said that Article 100 "expressly prohibits the elimination or reduction of benefits received by employees." It then set the test. The benefit must come from one of these:
- An express policy of the company.
- A written contract, such as the employment contract or a collective bargaining agreement (CBA).
- An unwritten policy that has ripened into company practice.
For a company practice, the grant "must be consistently and deliberately made by the employer over a significant period of time." The Court said there is no fixed rule on how long that period must be. It depends on the facts of each case.
In Beltran, a former employee proved with affidavits of other former employees that the company had a practice of granting early retirement to employees with at least 10 years of service, regardless of age. The Court granted his petition.
How long must a practice last?
There is no fixed number of years. In Nippon Paint (2021), the employer had given additional holiday pay for Eidul Adha for two years. The Court held that this had ripened into a company practice that the employer could not withdraw. It also said that holiday pay is "a legislated benefit."
What matters is that the grant was regular and deliberate, not a one-time act or an error.
What counts as a "benefit"?
Money, or something with a money equivalent. In Coca-Cola Bottlers v. Iloilo Coca-Cola Plant Employees Labor Union (2018), the union said that Saturday work was a benefit the company could not take away. The Court disagreed. It said the benefits covered by the rule are "monetary benefits or privileges given to the employee with monetary equivalents." Working on Saturday was not such a benefit, so the company could change the schedule.
Frequently asked questions
What is the non-diminution of benefits rule?
It is the rule in Article 100 of the Labor Code: the employer may not eliminate or reduce supplements or other benefits that employees already enjoy. The Supreme Court applies it to benefits that come from a policy, a contract or a long company practice.
Can my employer stop a bonus or allowance it has always given?
It depends on where the benefit comes from. In Beltran v. AMA Computer College (2019), the Supreme Court said the benefit must rest on an express policy, a written contract, or an unwritten policy that has ripened into company practice. A benefit given only once, or by mistake, is usually not protected.
How long must a benefit be given to become a company practice?
There is no fixed number of years. The Supreme Court said the grant must be consistent and deliberate over a significant period of time, decided on the facts of each case. In Nippon Paint (2021), extra holiday pay given for two years was enough.
Does the rule cover non-money privileges like a work schedule?
Not as a rule. In Coca-Cola Bottlers v. Iloilo Coca-Cola Plant Employees Labor Union (2018), the Court said benefits under this rule are monetary benefits or privileges with a money equivalent. Saturday work was not a benefit the company had to keep.
Where do I complain if a benefit was taken away?
A claim for unpaid benefits is a money claim. As a rule it goes through conciliation-mediation at DOLE first (the Single Entry Approach), and money claims must be filed within three years from the time they accrued. See the pages on filing a labor complaint and on the three-year deadline.
General information, not legal advice. For your case, ask a lawyer, the Public Attorney's Office (PAO) or the agency.
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