‘Of coins and wages’
It is a reminder to everyone that employees must be provided with a fair day’s wage for a fair day’s labor
Published in Daily Tribune on July 2, 2021
by: Juan Romulo R. Taleon
On 28 June 2021, the nation was probably amused by the story of a certain factory employee in Valenzuela City who vented his disappointment and frustration with his employer over the fact that the latter paid his salary of one thousand fifty-six pesos (P1,056) in 5 and 10 centavo coins.
The nation wondered what could the employee have done against the employer? Did the employee have the right to refuse? Could the employee vindicate himself against the apparent insult dished out by his employer in some form of legal action?
Well, for starters, people should know that under Section 52 of Republic Act 7653, all Philippine currency notes, bills and coins, may be used in payment for almost everything as they are guaranteed by the Government of the Republic of the Philippines as legal tender.
Like everything else, however, such is subject to certain limitations. For coins, the Bangko Sentral ng Pilipinas through BSP Circular 537, Series of 2006, set a maximum amount for payment in coins to be considered legal tender.
For 1-Piso, 5-Piso, and 10-Piso coins, you can only offer such number of coins as will total one thousand pesos (P1,000) for payment to be considered legal tender.
Meanwhile, for 1-centavo, 5-centavo, 10-centavo, and 25-centavo coins, you may only use enough coins as will total one hundred pesos (P100.00).
Otherwise, the recipient may refuse its payment or consider payment valid only to the threshold amount.
Given the foregoing limitations, could the employee who was paid his salary in 5 and 10 centavo coins have validly refused such payment? The answer is both yes and no. Yes, because the offer of payment in 5 and 10 centavo coins was valid legal tender only up to a hundred pesos. Hence, he could not have refused payment, but only up to a hundred pesos.
And no because he could have (as he should have), however, refused the payment in coins of any amount in excess of a hundred pesos for having been offered in violation of BSP Circular 537 s. 2006.
If the employer, in the foregoing scenario, insists on paying the employer’s salary in coins, the employee should demand payment of anything over a hundred pesos in notes or bills. Should the employer refuse, the employee may sue the employer for underpayment of wages before the National Labor Relations Commission.
In his complaint, the employee may, in addition to the unpaid portion of his wages, claim damages for the obvious emotional pain he suffered from the insulting and deliberate offer of payment made by the employer in coins. As corrective measure and by way of example or correction for the public good, he may also claim exemplary damage, attorney’s fees, and cost of suit.
So, it is a reminder to everyone that employees must be provided with a fair day’s wage for a fair day’s labor. Their right is not only stipulated in the Labor Code, but also in is Article 1705 of the New Civil Code which states that “the Laborer’s wages shall be made in legal currency”. Hence such legal currency must have the legal tender power for it to be given the legal effect. Further, the Constitution itself, the foundation of our laws, safeguards the rights of every laborer.
Also, we all should remember that while “everything, or almost everything, maybe bought by money” it should always be in legal tender.
Kindly take note that this article is based solely on the facts narrated herein and my appreciation of the same. My opinion may vary when other facts are changed.
