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THIRD DIVISION
 
 
|RODOLFO J. SERRANO, |G.R. No. 187698 | |                          Petitioner, |  | |  |Present: | |  |  | |  |CARPIO MORALES, J., Chairperson, | |                     - versus - |BRION, | |  |BERSAMIN, | |  |ABAD,* and | |  |VILLARAMA, JR., JJ. | |  |  | |SEVERINO SANTOS TRANSIT and/or SEVERINO SANTOS, |Promulgated:                  | |                            Respondents. |  | |  |August 9, 2010 |

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Labor Law; Retirement; Bus Conductors; Statutes; Republic Act No. 7641; Termination of Employment; Republic Act No. 7641 which was enacted on December 9, 1992 amended Article 287 of the Labor Code by providing for retirement pay to qualified private sector employees in the absence of any retirement plan in the establishment; Bus conductors paid on commission basis fall within the coverage of Republic Act No. 7641 and its implementing rules.—Republic Act No. 7641 which was enacted on December 9, 1992 amended Article 287 of the Labor Code by providing for retirement pay to qualified private sector employees in the absence of any retirement plan in the establishment. The pertinent provision of said law reads: x x x Admittedly, petitioner worked for 14 years for the bus company which did not adopt any retirement scheme. Even if petitioner as bus conductor was paid on commission basis then, he falls within the coverage of R.A. 7641 and its implementing rules. As thus correctly ruled by the Labor Arbiter, petitioner’s retirement pay should include the cash equivalent of the 5-day SIL and 1/12 of the 13th month pay.

Same; Same; Same; Taxi Drivers; Service Incentive Leave (SIL); For purposes of applying the law on Service Incentive Leave (SIL), as well as on retirement, the Court notes that there is a difference between drivers paid under the “boundary system” and conductors who are paid on commission basis; In practice, taxi drivers do not receive fixed wages—they retain only those sums in excess of the “boundary” or fee they pay to the owners or operators of the vehicles while conductors are paid a certain percentage of the bus’ earnings for the day.—The affirmance by the appellate court of the reliance by the NLRC on R & E Transport, Inc. is erroneous. In said case, the Court held that a taxi driver paid according to the “boundary system” is not entitled to the 13th month and the SIL pay, hence, his retirement pay should be computed on the sole basis of his...
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