Practice question
A lawful fixed monthly allowance is established to be a protected contractual benefit. The employer withdraws it unilaterally solely because it now prefers a lower payroll cost. No other legal justification or valid change is established. Which rule is relevant?
- A contractual benefit can always be erased by preference.
- An allowance can never be protected.
- Every benefit above minimum wage is automatically unlawful.
- A new payroll label always cancels the obligation.
- The non-diminution principle bars the stated unilateral withdrawal of the protected benefit.
Legal references
- https://lawphil.net/statutes/presdecs/pd1974/pd_442_1974.html — Labor Code, Article 100.
- https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/45241 — Arco Metal Products Co., Inc. v. SAMARM-NAFLU, GR 170734, May 14, 2008, main decision.
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