1.
INTERNATIONAL SCHOOL ALLIANCE OF EDUCATORS (ISAE),
petitioner, vs. HON. LEONARDO A. QUISUMBING G.R. No. 128845,
June 1, 2000
FACTS: Private respondent International School, Inc. (School), pursuant to
PD 732, is a domestic educational institution established primarily for
dependents of foreign diplomatic personnel and other temporary residents.
The decree authorizes the School to employ its own teaching and
management personnel selected by it either locally or abroad, from
Philippine or other nationalities, such personnel being exempt from
otherwise applicable laws and regulations attending their employment,
except laws that have been or will be enacted for the protection of
employees. School hires both foreign and local teachers as members of its
faculty, classifying the same into two: (1) foreign-hires and (2) local-hires.
The School grants foreign-hires certain benefits not accorded local-hires.
Foreign-hires are also paid a salary rate 25% more than local-hires.
When negotiations for a new CBA were held on June 1995, petitioner ISAE,
a legitimate labor union and the collective bargaining representative of all
faculty members of the School, contested the difference in salary rates
between foreign and local-hires. This issue, as well as the question of
whether foreign-hires should be included in the appropriate bargaining unit,
eventually caused a deadlock between the parties.
ISAE filed a notice of strike. Due to the failure to reach a compromise in the
NCMB, the matter reached the DOLE which favored the School. Hence this
petition.
ISSUE: Whether the foreign-hires should be included in bargaining unit of
local- hires.
RULING: NO. The Constitution, Article XIII, Section 3, specifically provides
that labor is entitled to “humane conditions of work.” These conditions are
not restricted to the physical workplace – the factory, the office or the field –
but include as well the manner by which employers treat their employees.
Discrimination, particularly in terms of wages, is frowned upon by the Labor
Code. Article 248 declares it an unfair labor practice for an employer to
discriminate in regard to wages in order to encourage or discourage
membership in any labor organization.
1 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
The Constitution enjoins the State to “protect the rights of workers and
promote their welfare, In Section 18, Article II of the constitution mandates
“to afford labor full protection”. The State has the right and duty to regulate
the relations between labor and capital. These relations are not merely
contractual but are so impressed with public interest that labor contracts,
collective bargaining agreements included, must yield to the common good.
However, foreign-hires do not belong to the same bargaining unit as the
local-hires.
A bargaining unit is a group of employees of a given employer, comprised of
all or less than all of the entire body of employees, consistent with equity to
the employer indicate to be the best suited to serve the reciprocal rights and
duties of the parties under the collective bargaining provisions of the law.
The factors in determining the appropriate collective bargaining unit are (1)
the will of the employees (Globe Doctrine); (2) affinity and unity of the
employees’ interest, such as substantial similarity of work and duties, or
similarity of compensation and working conditions (Substantial Mutual
Interests Rule); (3) prior collective bargaining history; and (4) similarity of
employment status. The basic test of an asserted bargaining unit’s
acceptability is whether or not it is fundamentally the combination which will
best assure to all employees the exercise of their collective bargaining rights.
In the case at bar, it does not appear that foreign-hires have indicated their
intention to be grouped together with local-hires for purposes of collective
bargaining. The collective bargaining history in the School also shows that
these groups were always treated separately. Foreign-hires have limited
tenure; local-hires enjoy security of tenure. Although foreign-hires perform
similar functions under the same working conditions as the local-hires,
foreign-hires are accorded certain benefits not granted to local-hires such as
housing, transportation, shipping costs, taxes and home leave travel
allowances. These benefits are reasonably related to their status as foreign-
hires, and justify the exclusion of the former from the latter. To include
foreign-hires in a bargaining unit with local-hires would not assure either
group the exercise of their respective collective bargaining rights.
WHEREFORE, the petition is GIVEN DUE COURSE. The petition is hereby
GRANTED IN PART.
2. BECMEN SERVICE EXPORTER AND PROMOTION, INC., V. SPS.
CUARESMA G.R. Nos. 182978-79, April 7, 2009
These consolidated petitions assail the Amended Decision of the Court of
Appeals finding White Falcon Services, Inc. and Becmen Service Exporter
and Promotion, Inc. solidarily liable to indemnify spouses Simplicio and Mila
Cuaresma the amount of US$4,686.73 in actual damages with interest.
FACTS: On January 6, 1997, Jasmin Cuaresma (Jasmin) was deployed by
Becmen Service Exporter and Promotion, Inc.2 (Becmen) to serve as
assistant nurse in Al-Birk Hospital in the Kingdom of Saudi Arabia (KSA), for
a contract duration of three years, with a corresponding salary of US$247.00
per month. Over a year later, she died allegedly of poisoning.
Based on the police report and the medical report of the examining physician
of the Al-Birk Hospital, who conducted an autopsy of Jasmin’s body, the
likely cause of her death was poisoning.
Jasmin’s body was repatriated to Manila on September 3, 1998. The
following day, the City Health Officer of Cabanatuan City conducted an
autopsy and the resulting medical report indicated that Jasmin died under
violent circumstances, and not poisoning as originally found by the KSA
examining physician. The City Health Officer found that Jasmin had
abrasions at her inner lip and gums; lacerated wounds and abrasions on her
left and right ears; lacerated wounds and hematoma (contusions) on her
elbows; abrasions and hematoma on her thigh and legs; intra-muscular
hemorrhage at the anterior chest; rib fracture; puncture wounds; and
abrasions on the labia minora of the vaginal area.6
On March 11, 1999, Jasmin’s remains were exhumed and examined by
the National Bureau of Investigation (NBI). The toxicology report of the NBI,
however, tested negative for non-volatile, metallic poison and insecticides.
Simplicio and Mila Cuaresma (the Cuaresmas), Jasmin’s parents and her
surviving heirs, received from the Overseas Workers Welfare Administration
(OWWA) the following amounts: P50,000.00 for death benefits; P50,000.00
for loss of life; P20,000.00 for funeral expenses; and P10,000.00 for medical
reimbursement.
On November 22, 1999, the Cuaresmas filed a complaint against Becmen
and its principal in the KSA, Rajab & Silsilah Company (Rajab), claiming
death and insurance benefits, as well as moral and exemplary damages for
Jasmin’s death.
2 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
While the case was pending, Becmen filed a manifestation and motion for
substitution alleging that Rajab terminated their agency relationship and had
appointed White Falcon Services, Inc. (White Falcon) as its new recruitment
agent in the Philippines. Thus, White Falcon was impleaded as respondent
as well, and it adopted and reiterated Becmen’s arguments in the position
paper it subsequently filed.
On February 28, 2001, the Labor Arbiter rendered a Decision dismissing the
complaint for lack of merit. Giving weight to the medical report of the Al-Birk
Hospital finding that Jasmin died of poisoning, the Labor Arbiter concluded
that Jasmin committed suicide. In any case, Jasmin’s death was not service-
connected, nor was it shown that it occurred while she was on duty; besides,
her parents have received all corresponding benefits they were entitled to
under the law. In regard to damages, the Labor Arbiter found no legal basis
to warrant a grant thereof.
On appeal, the National Labor Relations Commission (Commission)
reversed the decision of the Labor Arbiter. Relying on the findings of the City
Health Officer of Cabanatuan City and the NBI as contained in their autopsy
and toxicology report, respectively, the Commission, via its November 22,
2002 Resolution11 declared that, based on substantial evidence adduced,
Jasmin was the victim of compensable work-connected criminal aggression.
It disregarded the Al-Birk Hospital attending physician’s report as well as the
KSA police report, finding the same to be inconclusive. It declared that
Jasmin’s death was the result of an “accident” occurring within the
employer’s premises that is attributable to her employment, or to the
conditions under which she lived, and thus arose out of and in the course of
her employment as nurse. Thus, the Cuaresmas are entitled to actual
damages in the form of Jasmin’s lost earnings, including future earnings, in
the total amount of US$113,000.00. The Commission, however, dismissed
all other claims in the complaint.
Becmen, Rajab and White Falcon moved for reconsideration, whereupon the
Commission issued its October 9, 2003 Resolution12 reducing the award
of US$113,000.00 as actual damages to US$80,000.00.13 The NLRC
likewise declared Becmen and White Falcon as solidarily liable for payment
of the award.
Becmen and White Falcon brought separate petitions for certiorari to the
Court of Appeals. On June 28, 2006, the appellate court rendered its
Decision:
WHEREFORE, the subject petitions are DENIED but in the execution of the
decision, it should first be enforced against White Falcon Services and then
against Becmen Services when it is already impossible, impractical and futile
to go against it (White Falcon).
The appellate court affirmed the NLRC’s findings that Jasmin’s death was
compensable, the same having occurred at the dormitory, which was
contractually provided by the employer. Thus her death should be
considered to have occurred within the employer’s premises, arising out of
and in the course of her employment.
In the Amended Decision, the Court of Appeals found that although Jasmin’s
death was compensable, however, there is no evidentiary basis to support
an award of actual damages in the amount of US$80,000.00. Nor may lost
earnings be collected, because the same may be charged only against the
perpetrator of the crime or quasi-delict. Instead, the appellate court held that
Jasmin’s beneficiaries should be entitled only to the sum equivalent of the
remainder of her 36-month employment contract, or her monthly salary of
US$247.00 multiplied by nineteen (19) months, with legal interest.
Becmen filed the instant petition for review on certiorari (G.R. Nos. 182978-
79). The Cuaresmas, on the other hand, moved for a reconsideration of the
amended decision, but it was denied. They are now before us via G.R. Nos.
184298-99.
On October 6, 2008, the Court resolved to consolidate G.R. Nos. 184298-99
with G.R. Nos. 182978-79.
ISSUE: Whether the Cuaresmas are entitled to monetary claims, by way of
benefits and damages, for the death of their daughter Jasmin.
RULING: The relations between capital and labor are so impressed with
public interest, and neither shall act oppressively against the other, or impair
the interest or convenience of the public. In case of doubt, all labor
legislation and all labor contracts shall be construed in favor of the safety
and decent living for the laborer.
The grant of moral damages to the employee by reason of misconduct on
the part of the employer is sanctioned by Article 2219 (10)35 of the Civil
Code, which allows recovery of such damages in actions referred to in
Article 21.36
White Falcon’s assumption of Becmen’s liability does not automatically result
in Becmen’s freedom or release from liability. This has been ruled in ABD
Overseas Manpower Corporation v. NLRC.39 Instead, both Becmen and
3 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
White Falcon should be held liable solidarily, without prejudice to each
having the right to be reimbursed under the provision of the Civil Code that
whoever pays for another may demand from the debtor what he has paid.
WHEREFORE, the Amended Decision of the Court of Appeals dated May
14, 2008 in CA-G.R. SP No. 80619 and CA-G.R. SP No. 81030 is SET
ASIDE. Rajab & Silsilah Company, White Falcon Services, Inc., Becmen
Service Exporter and Promotion, Inc., and their corporate directors and
officers are found jointly and solidarily liable and ORDERED to indemnify the
heirs of Jasmin Cuaresma, spouses Simplicio and Mila Cuaresma, the
following amounts:
1) TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as
moral damages;
2) TWO MILLION FIVE HUNDRED THOUSAND PESOS (P2,500,000.00) as
exemplary damages;
3) Attorney’s fees equivalent to ten percent (10%) of the total monetary
award; and,
4) Costs of suit.
3. ESTER M. ASUNCION, petitioner, vs. NATIONAL LABOR
RELATIONS COMMISSION, Second Division, MABINI MEDICAL CLINIC
and DR. WILFRIDO JUCO, respondents.
FACTS:
Petitioner Ester M. Asuncion was employed as an accountant/bookkeeper by
the respondent Mabini Medical Clinic. Sometime in May 1994, certain
officials of the NCR-Industrial Relations Division of the Department of Labor
and Employment conducted a routine inspection of the premises of the
respondent company and discovered upon the disclosure of the petitioner of
(documents) violations of the labor standards law such as the non-coverage
from the SSS of the employees. Consequently, respondent Company was
made to correct these violations.
On August 9, 1994, the private respondent, Medical Director Wilfrido Juco,
issued a memorandum to petitioner charging her with the following offenses:
1. Chronic Absentism (sic) – You have incurred since Aug. 1993 up to the
present 35 absences and 23 half-days.
2. Habitual tardiness – You have late (sic) for 108 times. As shown on the
record book.
3. LoiteRing and wasting of company time – on several occasions and
witnessed by several employees.
4. Getting salary of an absent employee without acknowledging or signing
for it.
5. Disobedience and insubordination – continued refusal to sign memos
given to you.
Petitioner was required to explain within two (2) days why she should not be
terminated based on the above charges.
Three days later, in the morning of August 12, 1994, petitioner submitted her
response to the memorandum. On the same day, respondent Dr. Juco,
through a letter dated August 12, 1994, dismissed the petitioner on the
ground of disobedience of lawful orders and for her failure to submit her
reply within the two-day period. This prompted petitioner to file a case for
illegal termination
ISSUE: WHETHER OR NOT THE PETITIONER WAS VALIDLY
DISMISSED
HELD: The petition is impressed with merit. Although, it is a legal tenet that
factual findings of administrative bodies are entitled to great weight and
respect, we are constrained to take a second look at the facts before us
because of the diversity in the opinions of the Labor Arbiter and the NLRC. A
disharmony between the factual findings of the Labor Arbiter and those of
the NLRC opens the door to a review thereof by this Court.
It bears stressing that a worker’s employment is property in the constitutional
sense. He cannot be deprived of his work without due process. In order for
the dismissal to be valid, not only must it be based on just cause supported
by clear and convincing evidence, the employee must also be given an
opportunity to be heard and defend himself. It is the employer who has the
burden of proving that the dismissal was with just or authorized cause. The
failure of the employer to discharge this burden means that the dismissal is
not justified and that the employee is entitled to reinstatement and
backwages.
4 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
In the case at bar, there is a paucity of evidence to establish the charges of
absenteeism and tardiness. We note that the employer company submitted
mere handwritten listing and computer print-outs. The handwritten listing
was not signed by the one who made the same. As regards the print-outs,
while the listing was computer generated, the entries of time and other
annotations were again handwritten and unsigned.
The record is bereft of any showing that complainant was ever warned of her
absences prior to her dismissal on August 9, 1994. The alleged notices of
her absences from August 17, until September 30, 1993, from October until
November 27, 1993, from December 1, 1993 up to February 26, 1994 and
the notice dated 31 May 1994 reminding complainant of her five (5) days
absences, four (4) half-days and tardiness for 582 minutes (Annex “1” to “1-
D” attached to respondent’ Rejoinder), fail to show that the notices were
received by the complainant. The allegation of the respondents that the
complainant refused to received (sic) the same is self-serving and merits
scant consideration
The Court, likewise, takes note of the fact that the two-day period given to
petitioner to explain and answer the charges against her was most
unreasonable, considering that she was charged with several offenses and
infractions (35 absences, 23 half-days and 108 tardiness), some of which
were allegedly committed almost a year before, not to mention the fact that
the charges leveled against her lacked particularity.
Apart from chronic absenteeism and habitual tardiness, petitioner was also
made to answer for loitering and wasting of company time, getting salary of
an absent employee without acknowledging or signing for it and
disobedience and insubordination. Thus, the Labor Arbiter found that
actually petitioner tried to submit her explanation on August 11, 1994 or
within the two-day period given her, but private respondents prevented her
from doing so by instructing their staff not to accept complainant’s
explanation, which was the reason why her explanation was submitted a day
later.
The law mandates that every opportunity and assistance must be accorded
to the employee by the management to enable him to prepare adequately for
his defense. In Ruffy v. NLRC, the Court held that what would qualify as
sufficient or “ample opportunity,” as required by law, would be “every kind of
assistance that management must accord to the employee to enable him to
prepare adequately for his defense.” In the case at bar, private respondents
cannot be gainsaid to have given petitioner the ample opportunity to answer
the charges leveled against her.
From the foregoing, there are serious doubts in the evidence on record as to
the factual basis of the charges against petitioner. These doubts shall be
resolved in her favor in line with the policy under the Labor Code to afford
protection to labor and construe doubts in favor of labor. The consistent rule
is that if doubts exist between the evidence presented by the employer and
the employee, the scales of justice must be tilted in favor of the latter. The
employer must affirmatively show rationally adequate evidence that the
dismissal was for a justifiable cause. Not having satisfied its burden of proof,
we conclude that the employer dismissed the petitioner without any just
cause. Hence, the termination is illegal.
4. JPL MARKETING PROMOTIONS vs. COURT OF APPEALS
FACTS:
JPL is a domestic corporation engaged in the business of recruitment and
placement of workers, while private respondents Noel Gonzales, Ramon
Abesa III and Faustino Aninipot were employed by JPL as merchandisers on
separate dates and assigned at different establishments in Naga City and
Daet, Camarines Norte as attendants to the display of California Marketing
Corporation, one of JPL clients.
On 1996, JPL notified private respondents that CMC would stop its direct
merchandising activity in the Bicol Region, Isabela, and Cagayan Valley
effective 15 August 1996. They were advised to wait for further notice as
they would be transferred to other clients. However, on 17 October 1996,
private respondents Abesa and Gonzales filed before the NLRC complaints
for illegal dismissal, praying for separation pay, 13th month pay, service
incentive leave pay and payment for moral damages. Aninipot filed a similar
case thereafter.
LABOR ARBITER:
LA Rivera dismissed complaints for lack of merit. The LA said that Gonzales
and Abesa applied with another store before the 6monthperiod given by law
to JPL to provide private respondents a new assignment. Thus, they may be
considered to have unilaterally severed their relation with JPL, and cannot
charge JPL with illegal dismissal. LA said that it was their obligation to wait
until they were reassigned by JPL, and if after six months they were not
reassigned, they can file an action for separation pay but not for illegal
dismissal. The claims for 13th month pay and service incentive leave pay
was also denied since private respondents were paid way above the
applicable minimum wage during their employment.
5 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
NLRC:
NLRC affirmed LA but ordered Separation pay, based on their last salary
rate and counted from the first day of their employment with the
respondent JPL up to the finality of this judgment; Service Incentive Leave
pay, and 13th month pay, computed as in No.1 hereof
CA:
CA dismissed the petition and affirmed in toto the NLRC resolution. CA
rejected JPLs argument that the difference in the amounts of private
respondents salaries and the minimum wage in the region should be
considered as payment for their service incentive leave and 13 th month pay.
Notwithstanding the absence of a contractual agreement on the grant of
13th month pay, compliance with the same is mandatory under the law.
Moreover, JPL failed to show that it was exempt from paying service
incentive leave pay. JPL filed a motion for reconsideration of the said
resolution, but the same was denied on 25 January 2002.
ISSUE:
1. WON the private respondents are entitled to Separation Pay.
2. WON the private respondents are entitled to 13 th month pay and
service incentives leave pay.
RULING:
1. NO. Under Arts. 283 and 284 of the Labor Code, separation pay is
authorized only in cases of dismissals due to any of these reasons:
(a) installation of labor saving devices; (b) redundancy; (c)
retrenchment; (d) cessation of the employer's business; and (e)
when the employee is suffering from a disease and his continued
employment is prohibited by law or is prejudicial to his health and to
the health of his co-employees. However, separation pay shall be
allowed as a measure of social justice in those cases where the
employee is validly dismissed for causes other than serious
misconduct or those reflecting on his moral character, but only
when he was illegally dismissed. In addition, Sec. 4(b), Rule I, Book
VI of the Implementing Rules to Implement the Labor Code
provides for the payment of separation pay to an employee entitled
to reinstatement but the establishment where he is to be reinstated
has closed or has ceased operations or his present position no
 longer exists at the time of reinstatement for reasons not
attributable to the employer.
The common denominator of the instances where payment of separation
pay is warranted is that the employee was dismissed by the employer. In the
instant case, there was no dismissal to speak of. Private respondents were
simply not dismissed at all, whether legally or illegally. What they received
from JPL was not a notice of termination of employment, but a memo
informing them of the termination of CMCs contract with JPL. More
importantly, they were advised that they were to be reassigned. At that time,
there was no severance of employment to speak of.
Furthermore, Art. 286 of the Labor Code allows the bona fide suspension of
the operation of a business or undertaking for a period not exceeding six (6)
months, wherein an employee/employees are placed on the so-called
floating status. When that floating status of an employee lasts for more than
six months, he may be considered to have been illegally dismissed from the
service. Thus, he is entitled to the corresponding benefits for his separation,
and this would apply to suspension either of the entire business or of a
specific component thereof.
As clearly borne out by the records of this case, private respondents sought
employment from other establishments even before the expiration of the six
(6)-month period provided by law. As they admitted in their comment, all
three of them applied for and were employed by another establishment after
they received the notice from JPL. JPL did not terminate their employment;
they themselves severed their relations with JPL. Thus, they are not entitled
to separation pay.
2. YES. Presidential Decree No. 851, as amended, requires an
employer to pay its rank and file employees a 13 th month pay not later than
24 December of every year. However, employers not paying their employees
a 13th month pay or its equivalent are not covered by said law. The term its
equivalent was defined by the laws implementing guidelines as including
Christmas bonus, mid-year bonus, cash bonuses and other payment
amounting to not less than 1/12 of the basic salary but shall not include cash
and stock dividends, cost-of-living-allowances and all other allowances
regularly enjoyed by the employee, as well as non-monetary benefits.
On the other hand, service incentive leave, as provided in Art. 95 of the
Labor Code, is a yearly leave benefit of five (5) days with pay, enjoyed by an
employee who has rendered at least one year of service. Unless specifically
excepted, all establishments are required to grant service incentive leave to
6 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
their employees. The term at least one year of service shall mean service
within twelve (12) months, whether continuous or broken reckoned from the
date the employee started working. The Court has held in several instances
that service incentive leave is clearly demandable after one year of service.
The award of separation pay is deleted. Petitioner is ordered to pay private
respondents their 13th month pay commencing from the date of employment
up to 15 August 1996, as well as service incentive leave pay from the
second year of employment up to 15 August 1996.
5. San Miguel Brewery Sales Force Union v. Hon. Blas Ople
FACTS:
On April 17, 1978, a collective bargaining agreement (effective on May 1,
1978 until January 31, 1981) was entered into by petitioner San Miguel
Corporation Sales Force Union (PTGWO), and the private respondent, San
Miguel Corporation, Section 1, of Article IV of which provided as follows:
Art. IV, Section 1. Employees within the appropriate bargaining unit
shall be entitled to a basic monthly compensation plus commission
based on their respective sales.
In September 1979, the company introduced a marketing scheme known as
the “Complementary Distribution System” (CDS) whereby its beer products
were offered for sale directly to wholesalers through San Miguel’s sales
offices.
The labor union (herein petitioner) filed a complaint for unfair labor practice
in the Ministry of Labor, with a notice of strike on the ground that the CDS
was contrary to the existing marketing scheme whereby the Route Salesmen
were assigned specific territories within which to sell their stocks of beer, and
wholesalers had to buy beer products from them, not from the company. It
was alleged that the new marketing scheme violates Section 1, Article IV of
the collective bargaining agreement because the introduction of the CDS
would reduce the take-home pay of the salesmen and their truck helpers for
the company would be unfairly competing with them.
Minister of Labor:
Notice of strike filed by the petitioner, San Miguel Brewery Sales Force
Union-PTGWO is hereby dismissed. Management however is hereby
ordered to pay an additional three (3) months back adjustment commissions
over and above the adjusted commission under the complementary
distribution system.
ISSUE: Whether or not the CDS is a violation of the CBA.
HELD: No. The SC ruled that the CDS is an exercise of management
prerogatives whereby the management can implement schemes to optimize
their profit. Further, the CDS provides for a compensation clause as well for
salesmen. San Miguel Corporation’s offer to compensate the members of its
sales force who will be adversely affected by the implementation of the CDS
by paying them a so-called “back adjustment commission” to make up for the
commissions they might lose as a result of the CDS proves the company’s
good faith and lack of intention to bust their union.
6. WILTSHIRE FILE CO., INC. vs. NLRC and ONG
FACTS:
Private respondent Vicente T. Ong was the Sales Manager of petitioner
Wiltshire File Co. On 13 June 1985, upon private respondent's return from a
business and pleasure trip abroad, he was informed by the President of
petitioner Wiltshire that his services were being terminated. Private
respondent maintains that he tried to get an explanation from management
of his dismissal but to no avail. On 18 June 1985, when private respondent
again tried to speak with the President of Wiltshire, the company's security
guard handed him a letter which formally informed him that his services were
being terminated upon the ground of redundancy.
Private respondent filed a complaint before the Labor Arbiter for illegal
dismissal alleging that his position could not possibly be redundant because
nobody (save himself) in the company was then performing the same duties.
Private respondent further contended that retrenching him could not prevent
further losses because it was in fact through his remarkable performance as
Sales Manager that the Company had an unprecedented increase in
domestic market share the preceding year. For that accomplishment, he
continued, he was promoted to Marketing Manager and was authorized by
the President to hire four (4) Sales Executives five (5) months prior to his
termination.
LA:Labor Arbiter declared the termination of private respondent's services
illegal and ordered petitioner to pay private respondent backwages in the
amount of P299,000.00, unpaid salaries, accumulated sick and vacation
7 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
leaves, hospitalization benefit package, unpaid commission, moral damages
and attorney's fees.
NLRC: Affirmed the NLRC decision in toto; The termination letter clearly
spelled out that the main reason in terminating the services of complainant
is REDUNDANT and not retrenchment.
The supposed duplication of work of herein complainant and Mr. Deliva, the
Vice-President is absent that would justify redundancy. . .
ISSUE: WON there was an authorized cause of termination.
RULING: In the first place, we note that while the letter informing private
respondent of the termination of his services used the word “redundant“, that
letter also referred to the company having “incur[red] financial losses which
[in] fact has compelled [it] to resort to retrenchment to prevent further
losses”. Thus, what the letter was in effect saying was that because of
financial losses, retrenchment was necessary, which retrenchment in turn
resulted in the redundancy of private respondent’s position.
In the second place, we do not believe that redundancy in an employer’s
personnel force necessarily or even ordinarily refers to duplication of work.
That no other person was holding the same position that private respondent
held prior to the termination of his services, does not show that his position
had not become redundant. Indeed, in any well-organized business
enterprise, it would be surprising to find duplication of work and two (2) or
more people doing the work of one person. We believe that redundancy, for
purposes of our Labor Code, exists where the services of an employee are
in excess of what is reasonably demanded by the actual requirements of the
enterprise. Succinctly put, a position is redundant where it is superfluous,
and superfluity of a position or positions may be the outcome of a number of
factors, such as overhiring of workers, decreased volume of business, or
dropping of a particular product line or service activity previously
manufactured or undertaken by the enterprise.
Wiltshire, in view of the contraction of its volume of sales and in order to cut
down its operating expenses, effected some changes in its organization by
abolishing some positions and thereby effecting a reduction of its personnel.
Thus, the position of Sales Manager was abolished and the duties previously
discharged by the Sales Manager simply added to the duties of the General
Manager, to whom the Sales Manager used to report.
In the instant case, the ground for dismissal or termination of services does
not relate to a blameworthy act or omission on the part of the employee,
there appears to us no need for an investigation and hearing to be
conducted by the employer who does not, to begin with, allege any
malfeasance or non-feasance on the part of the employee. In such case,
there are no allegations which the employee should refute and defend
himself from. Thus, to require petitioner Wiltshire to hold a hearing, at which
private respondent would have had the right to be present, on the business
and financial circumstances compelling retrenchment and resulting in
redundancy, would be to impose upon the employer an unnecessary and
inutile hearing as a condition for legality of termination.
This is not to say that the employee may not contest the reality or good faith
character of the retrenchment or redundancy asserted as grounds for
termination of services. The appropriate forum for such controversion would,
however, be the Department of Labor and Employment and not an
investigation or hearing to be held by the employer itself. It is precisely for
this reason that an employer seeking to terminate services of an employee
or employees because of “closure of establishment and reduction of
personnel”, is legally required to give a written notice not only to the
employee but also to the Department of Labor and Employment at least one
month before effectivity date of the termination. In the instant case, private
respondent did controvert before the appropriate labor authorities the
grounds for termination of services set out in petitioner’s letter to him dated
17 June 1985.
(please take note)
Art. 283. Closure of establishment and reduction of personnel. –– The
employer may also terminate the employment of any employee due to the
installation of labor saving devices, redundancy, retrenchment to prevent
losses or the closing or cessation of operation of the establishment or
undertaking unless the closing is for the purpose of circumventing the
provisions of this Title, by serving a written notice on the workers and the
Ministry of Labor and Employment at least one (1) month before the
intended date thereof. In case of termination due to the installation of labor
saving devices or redundancy, the worker affected thereby shall be entitled
to a separation pay equivalent to at least his one (1) month pay or to at least
one (1) month pay for every year of service, whichever is higher. In case of
retrenchment to prevent losses and in cases of closures or cessation of
operations of establishment or undertaking not due to serious business
losses or financial reverses, the separation pay shall be equivalent to one (1)
month pay or at least one-half (1/2) month pay for every of service,
8 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
whichever is higher. A fraction of at least six (6) months shall be considered
one (1) whole year.
7. DR. PERLA POSTIGO vs.Philippine Tuberculosis Society Inc.
FACTS:
Petitioners Dr. Perla A. Postigo, et al., were regular employees of the
respondent Philippine Tuberculosis Society, Inc. (PTSI). They retired on
various dates from 1996 to 1998. Upon retirement from service, some of the
petitioners who were compulsory members of the Government Service
Insurance System (GSIS) obtained retirement benefits from the GSIS. At the
time the petitioners retired, Article 287 of the Labor Code had been amended
by Republic Act No. 7641. Rep. Act No. 7641 granted retirement pay to
qualified employees in the private sector, in the absence of any retirement
plan or agreement with the company. As the respondent did not have a
retirement plan for its employees, aside from its contribution to the GSIS,
petitioners claimed from the respondent their retirement benefits under Rep.
Act No. 7641. The respondent denied their claims on the ground that the
accommodation extended by the GSIS to the petitioners removed them from
the coverage of the law.
The petitioners then sought the opinion of the Bureau of Working
Conditions (BWC) of the Department of Labor and Employment regarding
their entitlement to the retirement benefits provided in Rep. Act No.
7641. The BWC confirmed their entitlement. The same opinion was rendered
and submitted by the respondents legal counsel, Atty. Rene V. Sarmiento, to
its Board of Directors. Despite this, respondent PTSI refused to pay the
petitioners their retirement benefits.
LA: Labor Arbiter declared petitioners entitled to retirement benefits under
Rep. Act No. 7641. However, one petitioner, Dr. Finaflor C. Tan who was
awarded her terminal leave pay, was not included in the award of retirement
benefits.
Respondent filed a Motion to Reduce Bond on the ground that the amount
awarded by the Labor Arbiter was erroneous.
NLRC: The NLRC dismissed the appeal for failure to post the required cash
or surety bond.
CA: Granted the petition of the PTSI and affirmed the motion to reduce
bond.
ISSUE: WON the plaintiffs are entitled to the retirement benefits plan under
R.A. 7641.
RULING: YES. petitioners are employees in the private sector, hence
entitled to the benefits of Rep. Act No. 7641.
Even assuming that by virtue of their compulsory inclusion in the GSIS, the
petitioners became employees in the public sector, they are still entitled to
the benefits of Rep. Act No. 7641 since they are not covered by the Civil
Service Law and its regulations. This much is certain upon reading the
implementing rules of Title II, Book VI of the Labor Code as afore-cited as
well as the Labor Advisory on Retirement Pay Law. The Philippine
Tuberculosis Society, Inc. (PTSI) is a government-owned and controlled
corporations under the Corporation Code are governed by the provisions of
the Labor Code. covered by Rep. Act No. 7641 which is an amendment to
the Labor Code. The accommodation under Rep. Act No. 1820 extending
GSIS coverage to PTSI employees did not take away from petitioners the
beneficial coverage afforded by Rep. Act No. 7641. Hence, the retirement
pay payable under Article 287 of the Labor Code as amended by Rep. Act
No. 7641 should be considered apart from the retirement benefit claimable
by the petitioners under the social security law or, as in this case, the GSIS
law.
8. ZAMBOANGA CITY WATER DISTRICT, petitioner vs. BUAT, et al.,
respondents
G.R. No. 104389 May 27, 1994
FACTS:
Private respondents are all employees of petitioner Zamboanga
City Water District. A strike occurred in the company and was conducted and
participated in by private respondents, for which reason they were separated
from their employment.
Petitioner filed a complaint before the Labor Arbiter to declare the
said strike illegal, while Zamboanga Utilities Labor Union (ZULU), to which
private respondents belonged, filed before the Labor Arbiter, a complaint
against petitioner for illegal dismissal and unpaid wages.
9 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
The two cases were consolidated and heard together, a
consolidated decision was rendered by the Executive Labor Arbiter declaring
both the strike and the dismissal of private respondents illegal and ordering
the reinstatement of private respondents to their former positions, without
loss of seniority rights and privileges, but without back wages.
Petitioner appealed to the NLRC but NLRC affirmed the decision of
the Executive Labor Arbiter, with the sole modification that the strike leader,
respondent Felix Laquio herein, be suspended from work without pay for a
period of six months, effective ten days from receipt of the decision.
Private respondents filed with the Executive Labor Arbiter a motion
for execution of the said decision. Executive Labor Arbiter granted the writ of
execution and ordered petitioner to reinstate all private respondents. Private
respondents filed a motion to compel the immediate reinstatement of
respondent Laquio and the payment of their back wages. According to
private respondents, the decision of the NLRC was executory immediately
upon receipt by petitioner of a copy thereof.
ISSUE:
When private respondents should be reinstated as ordered by the decision
of the Executive Labor Arbiter
RULING:
In any event, the decision of the Labor Arbiter reinstating a
dismissed or separated employee, insofar as the reinstatement aspect is
concerned, shall immediately be executory, even pending appeal. The
employee shall either be admitted back to work under the same terms and
conditions prevailing prior to his dismissal or separation or, at the option of
the employer, merely reinstated in the payroll. The posting of a bond by the
employer shall not stay the execution for reinstatement provided herein
Under the said provision of law, the decision of the Labor Arbiter
reinstating a dismissed or separated employee insofar as the reinstatement
aspect is concerned, shall be immediately executory, even pending appeal.
The employer shall reinstate the employee concerned either by: (a) actually
admitting him back to work under the same terms and conditions prevailing
prior to his dismissal or separation; or (b) at the option of the employer,
merely reinstating him in the payroll. Immediate reinstatement is mandated
and is not stayed by the fact that the employer has appealed, or has posted
a cash or surety bond pending appeal.
 9. ATOK BIG WEDGE COMPANY, INC., petitioner vs. JESUS P. GISON,
respondent (GR No. 169510 August 8, 2011)
FACTS: Respondent Gison was engaged as part-time consultant on retainer
basis by petitioner Atok Big Wedge Company, Inc., as a consultant on
retainer basis, respondent assisted petitioner's retained legal counsel with
matters pertaining to the prosecution of cases against illegal surface
occupants within the area covered by the company's mineral claims.
Respondent was likewise tasked to perform liaison work with several
government agencies, which he said was his expertise.
Petitioner did not require respondent to report to its office on a
regular basis, except when occasionally requested by the management to
discuss matters needing his expertise as a consultant. As payment for his
services, respondent received a retainer fee of P3,000.00 a month, which
was delivered to him either at his residence or in a local restaurant. The
parties executed a retainer agreement, but such agreement was misplaced
and can no longer be found.
Respondent requested that petitioner cause his registration with the
Social Security System (SSS), but petitioner did not accede to his request.
He later reiterated his request but it was ignored by respondent considering
that he was only a retainer/consultant. Respondent filed a Complaint with the
SSS against petitioner for the latter's refusal to cause his registration with
the SSS.
Resident manager of petitioner issued a Memorandum advising
respondent that within 30 days from receipt thereof, petitioner is terminating
his retainer contract with the company since his services are no longer
necessary.
Respondent filed a Complaint for illegal dismissal, unfair labor
practice, underpayment of wages, non-payment of 13th month pay, vacation
pay, and sick leave pay with the National Labor Relations Commission
against petitioner.
Finding no employer-employee relationship between petitioner and
respondent, the Labor Arbiter dismissed the complaint.
Respondent then appealed the decision to the NLRC.
NLRC affirmed the decision of the Labor Arbiter.
10 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
Respondent filed a Motion for Reconsideration, but it was denied.
CA rendered a decision annulling and setting aside the decision of
the NLRC.
ISSUE: Whether or not an employer-employee relationship exists between
petitioner and respondent.
RULING:
The Court ruled that there is no employer-employee relationship
between the parties, the termination of respondent's services by the
petitioner after due notice did not constitute illegal dismissal.
To ascertain the existence of employer-employee relationship
jurisprudence has invariably adhered to the four-fold test, to wit: (1) the
selection and engagement of the employee; (2) the payment of wages; (3)
the power of dismissal; and (4) the power to control the employee's conduct,
or the so-called "control test." Of these four, the last one is the most
important. The so-called control test is commonly regarded as the most
crucial and determinative indicator of the presence or absence of an
employer-employee relationship. Under the control test, an employer-
employee relationship exists where the person for whom the services are
performed reserves the right to control not only the end achieved, but also
the manner and means to be used in reaching that end.
Applying the aforementioned test, an employer-employee
relationship is apparently absent in the case at bar. Among other things,
respondent was not required to report every day during regular office hours
of petitioner. Respondent's monthly retainer fees were paid to him either at
his residence or a local restaurant. More importantly, petitioner did not
prescribe the manner in which respondent would accomplish any of the
tasks in which his expertise as a liaison officer was needed; respondent was
left alone and given the freedom to accomplish the tasks using his own
means and method. Respondent was assigned tasks to perform, but
petitioner did not control the manner and methods by which respondent
performed these tasks. Verily, the absence of the element of control on the
part of the petitioner engenders a conclusion that he is not an employee of
the petitioner.
10. Republic et al., petitioners vs. Asiapro, respondent
GR No. 172101 November 23, 2007
FACTS:
Respondent Asiapro, as a cooperative, is composed of owners-
members. Under its by-laws, owners-members are of two categories, to wit:
(1) regular member, who is entitled to all the rights and privileges of
membership; and (2) associate member, who has no right to vote and be
voted upon and shall be entitled only to such rights and privileges provided
in its by-laws. Its primary objectives are to provide savings and credit
facilities and to develop other livelihood services for its owners-members.
Respondent cooperative entered into several Service Contracts
with Stanfilco - a division of DOLE Philippines, Inc. The owners-members do
not receive compensation or wages from the respondent cooperative.
Instead, they receive a share in the service surplus which the respondent
cooperative earns from different areas of trade it engages in, such as the
income derived from the said Service Contracts with Stanfilco.
In order to enjoy the benefits under the Social Security Law of
1997, the owners-members of the respondent cooperative, who were
assigned to Stanfilco requested the services of the latter to register them
with petitioner SSS as self-employed and to remit their contributions as such.
Petitioner SSS sent a letter to the respondent cooperative,
informing the latter that based on the Service Contracts it executed with
Stanfilco, respondent cooperative is actually a manpower contractor
supplying employees to Stanfilco and for that reason, it is an employer of its
owners-members working with Stanfilco. Thus, respondent cooperative
should register itself with petitioner SSS as an employer and make the
corresponding report and remittance of premium contributions in accordance
with the Social Security Law of 1997.
Respondent cooperative sent a reply to petitioner SSS’s letter
asserting that it is not an employer because its owners-members are the
cooperative itself; hence, it cannot be its own employer. Petitioner SSS sent
a letter to respondent cooperative ordering the latter to register as an
employer and report its owners-members as employees for compulsory
coverage with the petitioner SSS. Respondent cooperative continuously
ignored the demand of petitioner SSS.
11 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
Petitioner SSS, filed a Petition before petitioner SSC against the
respondent cooperative and Stanfilco praying that the respondent
cooperative or, in the alternative, Stanfilco be directed to register as an
employer and to report respondent cooperative’s owners-members as
covered employees under the compulsory coverage of SSS and to remit the
necessary contributions in accordance with the Social Security Law of 1997.
Respondent cooperative filed its Answer with Motion to dismiss
alleging that no employer-employee relationship exists between it and its
owners-members, thus, petitioner SSC has no jurisdiction over the
respondent cooperative.
Court of Appeals rendered a Decision granting the petition filed by
the respondent cooperative DISMISSING the petition-complaint of herein
petitioner Social Security System. Aggrieved by the aforesaid Decision,
petitioner SSS moved for reconsideration, but it was denied by the appellate
court.
Hence, this Petition.
Petitioners contend that there is an employer-employee relationship
between the respondent cooperative and its owners-members. The
respondent cooperative is the employer of its owners-members considering
that it undertook to provide services to Stanfilco, the performance of which is
under the full and sole control of the respondent cooperative.
Respondent cooperative alleges that its owners-members own the
cooperative, thus, no employer-employee relationship can arise between
them. The persons of the employer and the employee are merged in the
owners-members themselves. Likewise, respondent cooperative’s owners-
members even requested the respondent cooperative to register them with
the petitioner SSS as self-employed individuals. Hence, petitioner SSC has
no jurisdiction over the petition-complaint filed before it by petitioner SSS.
ISSUE:
Whether or not there is an employer-employee relationship between
respondent cooperative and its owners-members.
RULING:
The Court ruled that the four elements in the four-fold test for the
existence of an employment relationship have been complied with; therefore
there is an employer-employee relationship between respondent cooperative
and its owners-members.
In determining the existence of an employer-employee relationship,
the following elements are considered: (1) the selection and engagement of
the workers; (2) the payment of wages by whatever means; (3) the power of
dismissal; and (4) the power to control the worker’s conduct, with the latter
assuming primacy in the overall consideration. The most important element
is the employer’s control of the employee’s conduct, not only as to the result
of the work to be done, but also as to the means and methods to
accomplish. The power of control refers to the existence of the power and
not necessarily to the actual exercise thereof. It is not essential for the
employer to actually supervise the performance of duties of the employee; it
is enough that the employer has the right to wield that power. All the
aforesaid elements are present in this case.
First. It is expressly provided in the Service Contracts that it is the
respondent cooperative which has the exclusive discretion in the selection
and engagement of the owners-members as well as its team leaders who
will be assigned at Stanfilco. Second. Wages are defined as "remuneration
or earnings, however designated, capable of being expressed in terms of
money, whether fixed or ascertained, on a time, task, piece or commission
basis, or other method of calculating the same, which is payable by an
employer to an employee under a written or unwritten contract of
employment for work done or to be done, or for service rendered or to be
rendered." In this case, the weekly stipends or the so-called shares in the
service surplus given by the respondent cooperative to its owners-members
were in reality wages, as the same were equivalent to an amount not lower
than that prescribed by existing labor laws, rules and regulations, including
the wage order applicable to the area and industry; or the same shall not be
lower than the prevailing rates of wages. It cannot be doubted then that
those stipends or shares in the service surplus are indeed wages, because
these are given to the owners-members as compensation in rendering
services to respondent cooperative’s client, Stanfilco. Third. It is also stated
in the above-mentioned Service Contracts that it is the respondent
cooperative which has the power to investigate, discipline and remove the
owners-members and its team leaders who were rendering services at
Stanfilco. Fourth. As earlier opined, of the four elements of the employer-
employee relationship, the "control test" is the most important. In the case at
bar, it is the respondent cooperative which has the sole control over the
manner and means of performing the services under the Service Contracts
with Stanfilco as well as the means and methods of work. Also, the
respondent cooperative is solely and entirely responsible for its owners-
members, team leaders and other representatives at Stanfilco. All these
12 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
clearly prove that, indeed, there is an employer-employee relationship
between the respondent cooperative and its owners-members.
11. Unilever Phil., Inc., petitioner vs. Rivera, respondent
GR No. 201701 June 3, 2013
FACTS:
Unilever is a company engaged in the production, manufacture,
sale, and distribution of various food, home and personal care products,
while Rivera was employed as its Area Activation Executive for Area 9
South, she was primarily tasked with managing the sales, distribution and
promotional activities in her area and supervising Ventureslink International,
Inc. (Ventureslink), a third party service provider for the company’s activation
projects.
Unilever enforces a strict policy that every trade activity must be
accompanied by a Trade Development Program (TDP) and that the
allocated budget for a specific activity must be used for such activity only.
Unilever’s internal auditor conducted a random audit and found out
that there were fictitious billings and fabricated receipts supposedly from
Ventureslink, it was also discovered that some funds were diverted from the
original intended projects. Upon further verification, Ventureslink reported
that the fund deviations were upon the instruction of Rivera.
Unilever issued a show-cause notice to Rivera asking her to explain
the following charges, to wit: a) Conversion and Misappropriation of
Resources; b) Breach of Fiduciary Trust; c) Policy Breaches; and d) Integrity
Issues.
Rivera admitted the fund diversions, but explained that such actions
were mere resourceful utilization of budget because of the difficulty of
procuring funds from the head office. She insisted that the diverted funds
were all utilized in the company’s promotional ventures in her area of
coverage.
Unilever found Rivera guilty of serious breach of the company’s
Code of Business Principles compelling it to sever their professional
relations. Rivera asked for reconsideration and requested Unilever to allow
her to receive retirement benefits having served the company for fourteen
 (14) years already. Unilever denied her request, reasoning that the forfeiture
of retirement benefits was a legal consequence of her dismissal from work.
Rivera filed a complaint for Illegal Dismissal and other monetary
claims against Unilever.
Labor Arbiter (LA) dismissed her complaint for lack of merit and
denied her claim for retirement benefits, but ordered Unilever to pay a
proportionate 13th month pay and the corresponding cash equivalent of her
unused leave credits.
NLRC partially granted Rivera’s prayer. NLRC held that although
she was legally dismissed from the service for a just cause, Unilever was
guilty of violating the twin notice requirement in labor cases. Thus, Unilever
was ordered to pay her nominal damages, retirement benefits and
separation pay.
Unilever asked for a reconsideration of the NLRC decision. NLRC
modified its earlier ruling by deleting the award of separation pay and
reducing the nominal damages, but affirmed the award of retirement benefits
to Rivera.
Unsatisfied with the ruling, Unilever elevated the case to CA-
Cagayan de Oro City via a petition for certiorari under Rule 65 of the Rules
of Court.
CA affirmed with modification the NLRC resolution. Justifying the
deletion of the award of retirement benefits, the CA explained that, indeed,
under Unilever’s Retirement Plan, a validly dismissed employee cannot
claim any retirement benefit regardless of the length of service. CA awarded
separation pay in her favor as a measure of social justice
ISSUE:
1. Whether or not a validly dismissed employee, like Rivera, is entitled to an
award of separation pay.
2. Whether or not Unilever was guilty of violating the twin notice requirement in
labor cases, thus liable for nominal damages.
RULING:
1. The Court ruled that Rivera is not entitled for a separation pay.
13 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
As a general rule, an employee who has been dismissed for any of
the just causes enumerated under Article 282 of the Labor Code is not
entitled to a separation pay. Section 7, Rule I, Book VI of the Omnibus Rules
Implementing the Labor Code provides:
Sec. 7. Termination of employment by employer. — The just
causes for terminating the services of an employee shall be those provided
in Article 282 of the Code. The separation from work of an employee for a
just cause does not entitle him to the termination pay provided in the Code,
without prejudice, however, to whatever rights, benefits and privileges he
may have under the applicable individual or collective agreement with the
employer or voluntary employer policy or practice.
In exceptional cases, however, the Court has granted separation
pay to a legally dismissed employee as an act of "social justice" or on
"equitable grounds." In both instances, it is required that the dismissal (1)
was not for serious misconduct; and (2) did not reflect on the moral character
of the employee.
In this case, Rivera was dismissed from work because she
intentionally circumvented a strict company policy, manipulated another
entity to carry out her instructions without the company’s knowledge and
approval, and directed the diversion of funds, which she even admitted doing
under the guise of shortening the laborious process of securing funds for
promotional activities from the head office. These transgressions were
serious offenses that warranted her dismissal from employment and proved
that her termination from work was for a just cause. Hence, she is not
entitled to a separation pay.
2. The Court ruled that Unilever is liable for nominal damages; there was a
violation of the right of Rivera to statutory due process.
Section 2. Standard of due process: requirements of
notice.
In all cases of termination of employment, the following
standards of due process shall be substantially observed.
I. For termination of employment based on just causes as
defined in Article 282 of the Code:
 (a) A written notice served on the employee specifying the
ground or grounds for termination, and giving to said employee
reasonable opportunity within which to explain his side;
(b) A hearing or conference during which the employee
concerned, with the assistance of counsel if the employee so
desires, is given opportunity to respond to the charge, present his
evidence or rebut the evidence presented against him; and
(c) A written notice of termination served on the employee
indicating that upon due consideration of all the circumstance,
grounds have been established to justify his termination.
In case of termination, the foregoing notices shall be served on the
employee’s last known address.
To clarify, the following should be considered in terminating the services of
employees:
(1) The first written notice to be served on the employees should
contain the specific causes or grounds for termination against them, and a
directive that the employees are given the opportunity to submit their written
explanation within a reasonable period. "Reasonable opportunity" under the
Omnibus Rules means every kind of assistance that management must
accord to the employees to enable them to prepare adequately for their
defense. This should be construed as a period of at least five (5) calendar
days from receipt of the notice to give the employees an opportunity to study
the accusation against them, consult a union official or lawyer, gather data
and evidence, and decide on the defenses they will raise against the
complaint. Moreover, in order to enable the employees to intelligently
prepare their explanation and defenses, the notice should contain a detailed
narration of the facts and circumstances that will serve as basis for the
charge against the employees. A general description of the charge will not
suffice. Lastly, the notice should specifically mention which company rules, if
any, are violated and/or which among the grounds under Art. 282 is being
charged against the employees.
(2) After serving the first notice, the employers should schedule and
conduct a hearing or conference wherein the employees will be given the
opportunity to: (1) explain and clarify their defenses to the charge against
them; (2) present evidence in support of their defenses; and (3) rebut the
evidence presented against them by the management. During the hearing or
conference, the employees are given the chance to defend themselves
personally, with the assistance of a representative or counsel of their choice.
14 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
Moreover, this conference or hearing could be used by the parties as an
opportunity to come to an amicable settlement.
(3) After determining that termination of employment is justified, the
employers shall serve the employees a written notice of termination
indicating that: (1) all circumstances involving the charge against the
employees have been considered; and (2) grounds have been established to
justify the severance of their employment.
In this case, Unilever was not direct and specific in its first notice to
Rivera. The words it used were couched in general terms and were in no
way informative of the charges against her that may result in her dismissal
from employment. Evidently, there was a violation of her right to statutory
due process warranting the payment of indemnity in the form of nominal
damages.
(12) Serrano v. Gallant Maritime Services Inc. & Marlow Navigation Co.
Inc
FACTS: For Antonio Serrano (petitioner), a Filipino seafarer, the last clause in the 5th
paragraph of Section 10, Republic Act (R.A.) No. 8042, which states: “Sec. 10. Money
Claims. - x x x In case of termination of overseas employment without just, valid or
authorized cause as defined by law or contract, the workers shall be entitled to the full
reimbursement of his placement fee with interest of twelve percent (12%) per annum,
plus his salaries for the unexpired portion of his employment contract or for three (3)
months for every year of the unexpired term, whichever is less.” violates OFW’s
constitutional rights in that it impairs the terms of contract, deprives them of equal
protection and denies them due process.
- Petitioner was hired by Gallant Maritime Services, Inc. and Marlow Navigation Co.,
Ltd. (respondents) under a Philippine Overseas Employment Administration (POEA)-
approved Contract of Employment with the following terms and conditions:
Duration of contract 12 months
Position Chief Officer
Basic monthly salary
US$1,400.00
 Hours of work 48.0
hours per week
Overtime US$700.00 per
month
Vacation leave with pay 7.00
days per month[5]
- On the date of his departure, petitioner was constrained to accept a downgraded
employment contract for the position of Second Officer with a monthly salary of
US$1,000.00, upon the assurance and representation of respondents that he would be
made Chief Officer by the end of April 1998. Respondents did not deliver on their
promise to make petitioner Chief Officer.[7] Hence, petitioner refused to stay on as
Second Officer and was repatriated to the Philippines on May 26, 1998.
- At the time of his repatriation, he was only able to serve 2 months and 7 days of his
contract, leaving an unexpired portion of 9 months and 23 days.
- Petitioner then filed with the Labor Arbiter a complaint against respondents for
dismissal and for payment of his money claims (US $ 26, 442.7311), as well as moral
and exemplary damages and attorney’s fees.
Labor Arbiter: Rendered a decision which stated that the dismissal of the petitioner is
illegal and awarded him monetary benefits. The respondents are likewise ordered to
pay the petitioner jointly and severally in Philippine Currency. However, the claims for
moral and exemplary damages are dismissed.
- In awarding the lump sum salary, the LA based his computation on the salary period
of 3 months only rather than the unexpired portion of the contract, applying the subject
clause.
- Respondents appealed to the (NLRC) to question the finding of the LA that petitioner
was illegally dismissed. On the other hand, petitioner also appealed to the NLRC on
the sole issue that the LA erred in not applying the ruling of the Court in Triple Integrated
Services, Inc. v. National Labor Relations Commission that in case of illegal dismissal,
OFWs are entitled to their salaries for the unexpired portion of their contracts.
NLRC: Modified the LA’s decision by reducing the applicable salary rate from US $2,
590.00 to US $1, 400.00 since RA 8042 does not provide for the award of overtime
pay.
15 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
- Petitioner filed a Motion for Partial Reconsideration but now, he questioned the
constitutionality of the subject clause. The NLRC denied the motion.
- Petitioner filed a Petition for Certiorari with the CA, reiterating the constitutional
challenge against the subject clause. CA eventually gave due course to it. Thus, CA
affirmed NLRC’s ruling on the reduction of the applicable salary rate ut skirted the
constitutional issue raised by the petitioner.
ISSUES:
(1) Whether or not Section 10 (par.5) of RA 8042 is unconstitutional thus, the
CA and LA Tribunals decided in a way not in accord with applicable decision
involving similar issue of granting unto the migrant worker back wages equal
to the unexpired portion instead of limiting it to 3 months.
(2) Whether or not the CA erred in excluding from petitioner’s award of
overtime pay and vacation pay since they form part of his salary.
HELD:
(1) YES. The subject clause is unconstitutional for it violates petitioner’s right
to substantive due process, deprives him op property which consist of
monetary benefits without any existing valid governmental purpose.
- The unanimous finding of the LA, NLRC and CA that the dismissal was
illegal is not disputed. Likewise, not disputed is the salary differential
awarded in all three fora. Applying the subject clause, the NLRC and the CA
computed the lump-sum salary of petitioner at his monthly rate for 3 months.
Petitioner’s contentions: However, petitioner contends that the subject
clause is unconstitutional because it impairs the freedom of OFWs to
negotiate for and stipulate in their contracts a determinate employment
period and salary package. It also impinges on the equal protection clause
for it treats OFWs differently from local Filipino workers by putting a cap on
the amount of lump sum payment and the treatment is not reasonable for
there is no substantial distinction between the 2 groups and that it defeats
the constitutional provisions which protect the rights and welfare of Filipino
workers.
- The decisions of the CA and Labor Tribunals are not in line with the
existing jurisprudence on the issue of money claims. The insertion of the
subject clause into RA No. 8042 serves no other purpose but to benefit local
agencies. He argues that in mitigating the liability of the local agencies, teh
well-being of OFWs is sacrificed.
- Lastly, he claims that the subject clause violates due process for it deprives
him of the salaries and emoluments he is entitled to under his fixed-period
employment contract.
Respondent’s contention: Constitutional issue should not be entertained
for this was belatedly interposed by petitioner in his appeal before the CA.
OSG’s contention: RA No. 8042 took effect in July 1995, the provisions
could not have impaired petitioner’s 1998 contract rather, it is deemed part of
the minimum terms of petitioner’s employment.
- It further emphasized that OFWs and local workers differ in terms of the
nature of their employment such that:
OFWs Local Workers
- Perform for the foreign - Perform jobs in the Philippines
employers
- contractual employees who can - Become regular employees
never acquire regular employment
- Thus, the provision does not violate the equal protection clause nor Section
18, Article II of the Constitution. It also defended that the subject clause is an
exercise of police power adopted to mitigate the solidary liability of
placement agencies for this redounds to the benefit of migrant workers.
SC RULING: The Court sustains the petitioner on these issues. The Court is
called upon to exercise its police power of judicial review of the acts of its co-
equals, only when these conditions obtain:
a.) actual case or controversy involving conflict of rights;
b.) constitutional question is raised by a proper party and at the earliest
opportunity;
16 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
c.) constitutional question is the very lis mota of the case
- In the case at bar, there is an actual controversy which involves the
petitioner who is personally aggrieved when the tribunals computed his
monetary award based on the salary period of 3 months only.
- The challenge is also timely for the issue on the constitutionality was first
raised in the petitioner’s motion for partial reconsideration with said Labor
tribunal and just reiterated such before the CA. It is the CA which has the
competence to resolve such issue.
- The 3rd requisite that the constitutional issue be critical to the resolution of
the case was likewise obtained because the monetary claim of petitioner to
his lump-sum salary for the entire unexpired portion of his 12-month
employment contract strikes at the very core of the subject clause.
- The subject clause violated Section 1, Article III of the Constitution and
Section 18, Article III and Article XIII on labor as a protected sector.
Section 1, Article III of the Constitution guarantees:
No person shall be deprived of life, liberty, or property
without due process of law nor shall any person be denied the
equal protection of the law.
Section 18,[63] Article II and Section 3,[64] Article XIII accord all members of
the labor sector, without distinction as to place of deployment, full protection of their
rights and welfare.
To Filipino workers, the rights guaranteed under the foregoing constitutional
provisions translate to economic security and parity: all monetary benefits should be
equally enjoyed by workers of similar category, while all monetary obligations should be
borne by them in equal degree; none should be denied the protection of the laws which
is enjoyed by, or spared the burden imposed on, others in like circumstances.
- Such rights are not absolute but subject to the inherent power of Congress to
incorporate, when it sees fit, a system of classification into its legislation; however, to be
valid, the classification must comply with these requirements:
a) it is based on substantial distinctions;
b) it is germane to the purposes of the law;
c) it is not limited to existing conditions only; and
d) it applies equally to all members of the class.
- There are three levels of scrutiny at which the Court reviews the constitutionality of a
classification embodied in a law:
a) the deferential or rational basis scrutiny in which the challenged classification needs
only be shown to be rationally related to serving a legitimate state interest;
b) the middle-tier or intermediate scrutiny in which the government must show that the
challenged classification serves an important state interest and that the
classification is at least substantially related to serving that interest; and
c) strict judicial scrutiny in which a legislative classification which impermissibly
interferes with the exercise of a fundamental right or operates to the peculiar
disadvantage of a suspect class is presumed unconstitutional, and the burden is upon
the government to prove that the classification is necessary to achieve a compelling
state interest and that it is the least restrictive means to protect such interest.
- The Court in the present case also employs the standard of strict judicial scrutiny for it
perceives in the subject clause a suspect classification prejudicial to OFWs. In a closer
examination, the subject clause has a discriminatory intent against and an invidious
impact on OFWs at 2 levels:
First, OFWs with employment contracts of less than one
year vis--vis OFWs with employment contracts of one year or
more;
Second, among OFWs with employment contracts of
more than one year; and
Third, OFWs vis--vis local workers with fixed-period
employment;
- In sum, prior to R.A. No. 8042, OFWs and local workers with fixed-term
employment who were illegally discharged were treated alike in terms of the
computation of their money claims: they were uniformly entitled to their
17 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
salaries for the entire unexpired portions of their contracts. But with the
enactment of R.A. No. 8042, specifically the adoption of the subject clause,
illegally dismissed OFWs with an unexpired portion of one year or more in
their employment contract have since been differently treated in that their
money claims are subject to a 3-month cap, whereas no such limitation is
imposed on local workers with fixed-term employment.
- There being a suspect classification involving a vulnerable sector protected by the
Constitution, the Court now subjects the classification to a strict judicial scrutiny, and
determines whether it serves a compelling state interest through the least restrictive
means. What constitutes compelling state interest is measured by the scale of rights
and powers arrayed in the Constitution and calibrated by history.
- In the present case, the Court dug deep into the records but found no compelling state
interest that the subject clause may possibly serve.
- The OSG defends the subject clause as a police power measure designed to protect
the employment of Filipino seafarers overseas but nowhere in the Comment or
Memorandum does the OSG cite the source of its perception of the state interest
sought to be served by the subject clause.
- A rule on the computation of money claims containing the subject clause was inserted
and eventually adopted as the 5th paragraph of Section 10 of R.A. No. 8042. In fine, the
Government has failed to discharge its burden of proving the existence of a compelling
state interest that would justify the perpetuation of the discrimination against OFWs
under the subject clause.
Assuming that, as advanced by the OSG, the purpose of the subject clause is to protect
the employment of OFWs by mitigating the solidary liability of placement agencies, such
callous and cavalier rationale will have to be rejected.
- The POEA Rules and Regulations Governing the Recruitment and Employment of
Land-Based Overseas Workers, dated February 4, 2002, imposes administrative
disciplinary measures on erring foreign employers who default on their contractual
obligations to migrant workers and/or their Philippine agents. Thus, the subject clause in
the 5th paragraph of Section 10 of R.A. No. 8042 is violative of the right of petitioner and
other OFWs to equal protection.
- Ultimately, therefore, Section 3 of Article XIII cannot, on its own, be a source of a
positive enforceable right. Thus, Section 3, Article XIII cannot be treated as a principal
source of direct enforceable rights, for the violation of which the questioned clause may
be declared unconstitutional.
(2) NO. The word salaries in Section 10(5) does not include overtime and leave pay.
- For seafarers like petitioner, DOLE Department Order No. 33, series 1996, provides a
Standard Employment Contract of Seafarers, in which salary is understood as the basic
wage, exclusive of overtime, leave pay and other bonuses; whereas overtime pay is
compensation for all work performed in excess of the regular eight hours, and holiday
pay is compensation for any work performed on designated rest days and holidays.
- By the foregoing definition alone, there is no basis for the automatic inclusion of
overtime and holiday pay in the computation of petitioner's monetary award, unless
there is evidence that he performed work during those periods.
- WHEREFORE, the Court GRANTS the Petition. The subject clause or for three
months for every year of the unexpired term, whichever is less in the 5th paragraph of
Section 10 of Republic Act No. 8042 is DECLARED UNCONSTITUTIONAL and that
petitioner is AWARDED his salaries for the entire unexpired portion of his employment
contract consisting of nine months and 23 days computed at the rate of US$1,400.00
per month.
(13) Sameer Overseas Placement Agency Inc. v. Joy C. Cabiles
FACTS: Petitioner, Sameer Overseas Placement Agency, Inc. is a
recruitment and placement agency. Responding to an ad it published,
respondent Joy Cabile submitted her application for a quality control job in
Taiwan.
- Respondent’s application was accepted. She thus signed a one-year
employment contract for a monthly salary of NT$15,360.00. She alleged that
she was required to pay a placement fee of P70, 000.
- Joy was deployed to work for Taiwan Wacoal, Co. Ltd. (Wacoal) on June
26, 1997. She alleged that in her employment contract, she agreed to work
as quality control for one year. In Taiwan, she was asked to work as a cutter.
- Sameer claims that on July 14, 1997, a certain Mr. Huwang from Wacoal
informed Joy, without prior notice, that she was terminated and that “she
should immediately report to their office to get her salary and passport.” She
was asked to “prepare for immediate repatriation.”
- Joy claims that she was told that from June 26 to July 14, 1997, she only
earned a total of NT$9,000.15. According to her, Wacoal deducted
NT$3,000 to cover her plane ticket to Manila.
18 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
- On October 15, 1997, Joy filed a complaint for illegal dismissal with the
NLRC against petitioner and Wacoal. She claimed that she was illegally
dismissed. She asked for the return of her placement fee, the withheld
amount of repatriation costs, payment of salary for 23 months as well as
moral and exemplary damages.
- Sameer alleged that her termination was due to her inefficiency, negligence
in her duties and her failure to comply with work requirements of the foreign
employer. It also claimed that it did not ask for a placement fee of P70, 000,
in fact as evidenced by the receipt, she only paid P20, 360.00. It also added
that Wacoal’s accreditation with the petitioner had already been transferred
to Pacific Manpower thus, it was already substituted by it.
- Pacific Manpower moved for the dismissal of the petitioner’s claims against
it for it alleged that there was no employer-employee relationship between
them thus, the claims were outside the jurisdiction of the LA.
Labor Arbiter: Dismissed the respondent’s complaint. It alleged that it was
based on mere allegations.
NLRC: Reversed LA’s decision. It ruled that respondent was illegally
dismissed. There was no sufficient proof that respondent was inefficient in
work and that she failed in complying eith the company requirements. It
awarded only 3 months worth of salary, the reimbursement of NT $3, 000
and attorney’s fees.
CA: Affirmed the ruling of the National Labor Relations Commission finding
respondent illegally dismissed and awarding her three months’ worth of
salary, the reimbursement of the cost of her repatriation, and attorney’s fees.
It remanded the case to the NLRC to address validity of petitioner’s
allegations against Pacific Manpower.
- Dissatisfied, petitioner Sameer filed this petition. It alleged that the CA
erred in affirming NLRC’s decision in finding that the respondent was illegally
dismissed. It reiterated that there was just cause for termination because
there was a finding of Wacoal that respondent is inefficient in work. Thus, the
dismissal was valid. Lastly, it contended that Pacific Manpower should now
assume responsibility for Wacoal’s contractual obligations.
ISSUE: Whether or not Cabiles was entitled to the unexpired portion of her
salary due to illegal dismissal.
HELD: YES. Respondent, having been illegally dismissed is entitled to her
salary for the unexpired portion of the employment contract.
- The Court held that the award of the three-month equivalent of
respondent’s salary should be increased to the amount equivalent to the
unexpired term of the employment contract. Section 10 of Republic Act No.
8042, otherwise known as the Migrant Workers and Overseas Filipinos Act
of 1995, states that overseas workers who were terminated without just,
valid, or authorized cause “shall be entitled to the full reimbursement of his
placement fee with interest of twelve (12%) per annum, plus his salaries for
the unexpired portion of his employment contract or for three (3) months for
every year of the unexpired term, whichever is less.”
Sec. 10. MONEY CLAIMS. – Notwithstanding any provision of law to the
contrary, the Labor Arbiters of the National Labor Relations Commission
(NLRC) shall have the original and exclusive jurisdiction to hear and decide,
within ninety (90) calendar days after filing of the complaint, the claims
arising out of an employer-employee relationship or by virtue of any law or
contract involving Filipino workers for overseas deployment including claims
for actual, moral, exemplary and other forms of damages.
- The liability of the principal/employer and the recruitment/placement
agency for any and all claims under this section shall be joint and several.
This provisions shall be incorporated in the contract for overseas
employment and shall be a condition precedent for its approval. Such
liabilities shall continue during the entire period or duration of the
employment contract and shall not be affected by any substitution,
amendment or modification made locally or in a foreign country of the said
contract.
- Any compromise/amicable settlement or voluntary agreement on money
claims inclusive of damages under this section shall be paid within four (4)
months from the approval of the settlement by the appropriate authority.
- In case of termination of overseas employment without just, valid or
authorized cause as defined by law or contract, the workers shall be entitled
to the full reimbursement of his placement fee with interest of twelve (12%)
per annum, plus his salaries for the unexpired portion of his employment
contract or for three (3) months for every year of the unexpired term,
whichever is less.
- The Labor Code also entitles the employee to 10% of the amount of
withheld wages as attorney’s fees when the withholding is unlawful.
19 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
The Court of Appeals affirmed the National Labor Relations Commission’s
decision to award respondent NT$46,080.00 or the three-month equivalent
of her salary, attorney’s fees of NT$300.00, and the reimbursement of the
withheld NT$3,000.00 salary, which answered for her repatriation.
We uphold the finding that respondent is entitled to all of these awards. The
award of the three-month equivalent of respondent’s salary should, however,
be increased to the amount equivalent to the unexpired term of the
employment contract.
- In Serrano v. Gallant Maritime Services, Inc. and Marlow Navigation Co.,
Inc., this court ruled that the clause “or for three (3) months for every year of
the unexpired term, whichever is less” is unconstitutional for violating the
equal protection clause and substantive due process.
- A statute or provision which was declared unconstitutional is not a law. It
“confers no rights; it imposes no duties; it affords no protection; it creates no
office; it is inoperative as if it has not been passed at all.”
- The Court said that they are aware that the clause “or for three (3) months
for every year of the unexpired term, whichever is less” was reinstated in
Republic Act No. 8042 upon promulgation of Republic Act No. 10022 in
2010.
- In Serrano v Gallant, it was held that limiting wages that should be
recovered by an illegally dismissed overseas worker to 3 months is both a
violation of due process and the equal protection clauses of the Constitution.
- As to the liabilities of Wacoal: Section 1o of the Migrant Workers and
Overseas Filipinos Act of 1995 provides that the foreign employer and the
local employment agency are jointly and severally liable for money claims
out of an employer-employee relationship.
(14) Hon. Sto. Tomas v. Salac
FACTS: On June 7, 1995 Congress enacted Republic Act (R.A.) 8042 or the
Migrant Workers and Overseas Filipinos Act of 1995 that, for among other
purposes, sets the Government’s policies on overseas employment and
establishes a higher standard of protection and promotion of the welfare of
migrant workers, their families, and overseas Filipinos in distress.
G.R. 152642 and G.R. 152710
(Constitutionality of Sections 29 and 30, R.A. 8042)
- Sections 29 and 30 of the Act commanded the Department of Labor and
Employment (DOLE) to begin deregulating within one year of its passage the
business of handling the recruitment and migration of overseas Filipino
workers and phase out within five years the regulatory functions of the
Philippine Overseas Employment Administration (POEA).
- On January 8, 2002 respondents Rey Salac, Willie D. Espiritu, Mario
Montenegro, Dodgie Belonio, Lolit Salinel, and Buddy Bonnevie (Salac, et
al.) filed a petition for certiorari, prohibition and mandamus with application
for temporary restraining order (TRO) and preliminary injunction against
petitioners.
- Salac, et al. sought to: 1) nullify DOLE Department Order 10 and POEA
Memorandum Circular 15; 2) prohibit the DOLE, POEA, and TESDA from
implementing the same and from further issuing rules and regulations that
would regulate the recruitment and placement of overseas Filipino workers
(OFWs); and 3) also enjoin them to comply with the policy of deregulation
mandated under Sections 29 and 30 of Republic Act 8042.
- The Quezon City RTC granted Salac, et al.’s petition and ordered the
government agencies mentioned to deregulate the recruitment and
placement of OFWs. It also annulled DOLE DO 10, POEA MC 15, and all
other orders, circulars and issuances that are inconsistent with the policy of
deregulation under R.A. 8042. The government officials concerned filed the
present petition in G.R. 152642 seeking to annul the RTC’s decision and
have the same enjoined pending action on the petition.
- On April 17, 2002 the Philippine Association of Service Exporters, Inc.
intervened in the case before the Court, claiming that the RTC March 20,
2002 Decision gravely affected them since it paralyzed the deployment
abroad of OFWs and performing artists. The Confederated Association of
Licensed Entertainment Agencies, Incorporated (CALEA) intervened for the
same purpose.
- On May 23, 2002 the Court issued a TRO in the case, enjoining the
Quezon City RTC, Branch 96, from enforcing its decision.
20 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
- On March 12, 2002 the Quezon City RTC rendered an Order, granting the
petition and enjoining the government agencies involved from exercising
regulatory functions over the recruitment and placement of OFWs.
- In the recruitment and placement of workers to service the requirements for
trained and competent Filipino workers of foreign governments and their
instrumentalities, and such other employers as public interests may require,
the administration shall deploy only to countries where the Philippines has
concluded bilateral labor agreements or arrangements: Provided, That such
countries shall guarantee to protect the rights of Filipino migrant workers;
and: Provided, further, That such countries shall observe and/or comply with
the international laws and standards for migrant workers.
- Respondents Salac, et al. told the Court in G.R. 152642 that they agree
with the Republic’s view that the repeal of Sections 29 and 30 of R.A. 8042
renders the issues they raised by their action moot and academic. The Court
has no reason to disagree. Consequently, the two cases, G.R. 152642 and
152710, should be dismissed for being moot and academic.
G.R. 167590
(Constitutionality of Sections 6, 7, and 9 of R.A. 8042)
- Respondent Philippine Association of Service Exporters, Inc. (PASEI) filed
a petition for declaratory relief and prohibition with prayer for issuance of
TRO and writ of preliminary injunction before the RTC of Manila, seeking to
annul Sections 6, 7, and 9 of R.A. 8042 for being unconstitutional. (PASEI
also sought to annul a portion of Section 10 but the Court will take up this
point later together with a related case.)
Section 6 defines the crime of "illegal recruitment" and enumerates the acts
constituting the same. Section 7 provides the penalties for prohibited acts.
Thus:
SEC. 6. Definition. – For purposes of this Act, illegal recruitment shall mean
any act of canvassing, enlisting, contracting, transporting, utilizing, hiring,
procuring workers and includes referring, contract services, promising or
advertising for employment abroad, whether for profit or not, when
undertaken by a non-license or non-holder of authority contemplated under
Article 13(f) of Presidential Decree No. 442, as amended, otherwise known
as the Labor Code of the Philippines: Provided, That such non-license or
non-holder, who, in any manner, offers or promises for a fee employment
abroad to two or more persons shall be deemed so engaged. It shall likewise
include the following acts, whether committed by any person, whether a non-
licensee, non-holder, licensee or holder of authority:
xxxx
SEC. 7. Penalties. –
(a) Any person found guilty of illegal recruitment shall suffer the
penalty of imprisonment of not less than six (6) years and one (1)
day but not more than twelve (12) years and a fine not less than
two hundred thousand pesos (₱200,000.00) nor more than five
hundred thousand pesos (₱500,000.00).
(b) The penalty of life imprisonment and a fine of not less than five
hundred thousand pesos (₱500,000.00) nor more than one million
pesos (₱1,000,000.00) shall be imposed if illegal recruitment
constitutes economic sabotage as defined herein.
Provided, however, That the maximum penalty shall be imposed if the
person illegally recruited is less than eighteen (18) years of age or
committed by a non-licensee or non-holder of authority.
Finally, Section 9 of R.A. 8042 allowed the filing of criminal actions arising
from "illegal recruitment" before the RTC of the province or city where the
offense was committed or where the offended party actually resides at the
time of the commission of the offense.
- The RTC of Manila declared Section 6 unconstitutional after hearing on the
ground that its definition of "illegal recruitment" is vague as it fails to
distinguish between licensed and non-licensed recruiters and for that reason
gives undue advantage to the non-licensed recruiters in violation of the right
to equal protection of those that operate with government licenses or
authorities.
- It also declared Section 7 unconstitutional on the ground that its sweeping
application of the penalties failed to make any distinction as to the
seriousness of the act committed for the application of the penalty imposed
on such violation.
- Apparently, the Manila RTC did not agree that the law can impose such
grave penalties upon what it believed were specific acts that were not as
21 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
condemnable as the others in the lists. But, in fixing uniform penalties for
each of the enumerated acts under Section 6, Congress was within its
prerogative to determine what individual acts are equally reprehensible,
consistent with the State policy of according full protection to labor, and
deserving of the same penalties. It is not within the power of the Court to
question the wisdom of this kind of choice. Obviously, in fixing such tough
penalties, the law considered the unsettling fact that OFWs must work
outside the country’s borders and beyond its immediate protection. The law
must, therefore, make an effort to somehow protect them from
conscienceless individuals within its jurisdiction who, fueled by greed, are
willing to ship them out without clear assurance that their contracted
principals would treat such OFWs fairly and humanely.
- The Manila RTC also invalidated Section 9 of R.A. 8042 on the ground that
allowing the offended parties to file the criminal case in their place of
residence would negate the general rule on venue of criminal cases which is
the place where the crime or any of its essential elements were committed.
Venue, said the RTC, is jurisdictional in penal laws and, allowing the filing of
criminal actions at the place of residence of the offended parties violates
their right to due process.
G.R. 167590, G.R. 182978-79 and G.R. 184298-99
(Constitutionality of Section 10, last sentence of 2nd paragraph)
- G.R. 182978-79 and G.R. 184298-99 are consolidated cases. Respondent
spouses Simplicio and Mila Cuaresma (the Cuaresmas) filed a claim for
death and insurance benefits and damages against petitioners Becmen
Service Exporter and Promotion, Inc. (Becmen) and White Falcon Services,
Inc. (White Falcon) for the death of their daughter Jasmin Cuaresma while
working as staff nurse in Riyadh, Saudi Arabia.
- The Labor Arbiter (LA) dismissed the claim on the ground that the
Cuaresmas had already received insurance benefits arising from their
daughter’s death from the Overseas Workers Welfare Administration
(OWWA). The LA also gave due credence to the findings of the Saudi
Arabian authorities that Jasmin committed suicide.
- On appeal, however, the National Labor Relations Commission (NLRC)
found Becmen and White Falcon jointly and severally liable for Jasmin’s
death and ordered them to pay the Cuaresmas the amount of
US$113,000.00 as actual damages. The NLRC relied on the Cabanatuan
City Health Office’s autopsy finding that Jasmin died of criminal violence and
rape.
Becmen and White Falcon appealed the NLRC Decision to the Court of
Appeals (CA). In 2006, the CA held Becmen and White Falcon jointly and
severally liable with their Saudi Arabian employer for actual damages, with
Becmen having a right of reimbursement from White Falcon. Becmen and
White Falcon appealed the CA Decision to this Court.
- In 2009 the Court found Jasmin’s death not work-related or work-connected
since her rape and death did not occur while she was on duty at the hospital
or doing acts incidental to her employment. The Court deleted the award of
actual damages but ruled that Becmen’s corporate directors and officers are
solidarily liable with their company for its failure to investigate the true nature
of her death. Becmen and White Falcon abandoned their legal, moral, and
social duty to assist the Cuaresmas in obtaining justice for their daughter.
- Consequently, the Court held the foreign employer Rajab and Silsilah,
White Falcon, Becmen, and the latter’s corporate directors and officers
jointly and severally liable to the Cuaresmas for: 1) P2,500,000.00 as moral
damages; 2) P2,500,000.00 as exemplary damages; 3) attorney’s fees of
10% of the total monetary award; and 4) cost of suit.
- The corporate directors and officers of Becmen, questioned the
constitutionality of the last sentence of the second paragraph of Section 10,
R.A. 8042 which holds the corporate directors, officers and partners jointly
and solidarily liable with their company for money claims filed by OFWs
against their employers and the recruitment firms. On September 9, 2009 the
Court allowed the intervention and admitted Gumabay, et al.’s motion for
reconsideration.
ISSUE: Whether or not the 2nd paragraph of Section 10, R.A. 8042, which
holds the corporate directors, officers, and partners of recruitment and
placement agencies jointly and solidarily liable for money claims and
damages that may be adjudged against the latter agencies, is
unconstitutional.
HELD: NO. It is valid and constitutional.
- In G.R. 167590 (the PASEI case), the Quezon City RTC held as
unconstitutional the last sentence of the 2nd paragraph of Section 10 of R.A.
8042. It pointed out that, absent sufficient proof that the corporate officers
22 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
and directors of the erring company had knowledge of and allowed the illegal
recruitment, making them automatically liable would violate their right to due
process of law.
- But the Court has already held, pending adjudication of this case, that the
liability of corporate directors and officers is not automatic. To make them
jointly and solidarily liable with their company, there must be a finding that
they were remiss in directing the affairs of that company, such as sponsoring
or tolerating the conduct of illegal activities.
- In the case of Becmen and White Falcon, while there is evidence that these
companies were at fault in not investigating the cause of Jasmin’s death,
there is no mention of any evidence in the case against them that
intervenors Gumabay, et al., Becmen’s corporate officers and directors, were
personally involved in their company’s particular actions or omissions in
Jasmin’s case.
- R.A. 8042 is a police power measure intended to regulate the recruitment
and deployment of OFWs. It aims to curb, if not eliminate, the injustices and
abuses suffered by numerous OFWs seeking to work abroad. The rule is
settled that every statute has in its favor the presumption of constitutionality.
The Court cannot inquire into the wisdom or expediency of the laws enacted
by the Legislative Department. Hence, in the absence of a clear and
unmistakable case that the statute is unconstitutional, the Court must uphold
its validity.
WHEREFORE, in G.R. 152642 and 152710, the Court DISMISSES the
petitions for having become moot and academic.1âwphi1
- The Court HOLDS the last sentence of the second paragraph of Section 10
of Republic Act 8042 valid and constitutional. The Court, however,
RECONSIDERS and SETS ASIDE the portion of its Decision in G.R.
182978-79 and G.R. 184298-99 that held intervenors Eufrocina Gumabay,
Elvira Taguiam, Lourdes Bonifacio, and Eddie De Guzman jointly and
solidarily liable with respondent Becmen Services Exporter and Promotion,
Inc. to spouses Simplicia and Mila Cuaresma for lack of a finding in those
cases that such intervenors had a part in the act or omission imputed to their
corporation.
(15) Eastern Meditteranean Maritime Ltd. v. Surio, et al.
FACTS: Respondents were former crewmembers of MT Seadance, a vessel
owned by petitioner Eastern Mediterranean Maritime Ltd. and manned and
operated by petitioner Agemar Manning Agency, Inc. While respondents
were still on board the vessel, they experienced delays in the payment of
their wages and in the remittance of allotments, and were not paid for extra
work and extra overtime work.
- They complained about the vessel s inadequate equipment, and about the
failure of the petitioners to heed their repeated requests for the improvement
of their working conditions.
- When MT Seadance docked at the port of Brofjorden, Sweden to discharge
oil, representatives of the International Transport Federation (ITF) boarded
the vessel and found the wages of the respondents to be below the
prevailing rates.
- The ensuing negotiations between the ITF and the vessel owner on the
increase in respondents wages resulted in the payment by the vessel owner
of wage differentials and the immediate repatriation of respondents to the
Philippines.
- Subsequently, the petitioners filed against the newly-repatriated
respondents a complaint for disciplinary action based on breach of discipline
and for the reimbursement of the wage increases in the Workers Assistance
and Adjudication Office of the POEA.
- During the pendency of the administrative complaint in the POEA, Republic
Act No. 8042 (Migrant Workers and Overseas Filipinos Act of 1995) took
effect on July 15, 1995. Section 10 of Republic Act No. 8042 vested original
and exclusive jurisdiction over all money claims arising out of employer-
employee relationships involving overseas Filipino workers in the Labor
Arbiters, to wit:
“Section 10. Money Claims. Notwithstanding any provision of law to
the contrary, the Labor Arbiters of the National Labor Relations
Commission (NLRC) shall have the original and exclusive
jurisdiction to hear and decide, within ninety (90) calendar days
after the filing of the complaint, the claims arising out of an
employer-employee relationship or by virtue of any law or contract
23 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
involving Filipino workers for overseas deployment including claims
for actual, moral, exemplary and other forms of damages.”
- The jurisdiction over such claims was previously exercised by the POEA
under the POEA Rules and Regulations of 1991 (1991 POEA Rules).
- Thereafter, the POEA dismissed the complaint for disciplinary action.
Petitioners filed a partial appeal before the NLRC, still maintaining that
respondents should be administratively sanctioned for their conduct while
they were on board MT Seadance.
- NLRC: Dismissed the appeal. The Commission has no jurisdiction to
review cases decided by the POEA Administrator involving disciplinary
actions. Under the Migrant Workers and Overseas Filipinos Act of 1995, the
Labor Arbiter shall have jurisdiction over money claims involving employer-
employee relationship (sec. 10, R.A. 8042).
- Petitioners moved for reconsideration, but the NLRC denied their motion.
Petitioners then commenced in this Court a special civil action for certiorari
and mandamus contending that: THE NLRC GRAVELY ABUSED ITS
DISCRETION AND/OR GRAVELY ERRED IN DISMISSING PETITIONERS
APPEAL AND MOTION FOR RECONSIDERATION WHEN IT REFUSED
TO TAKE COGNIZANCE OF PETITIONERS APPEAL DESPITE BEING
EMPOWERED TO DO SO UNDER THE LAW.
- CA: Dismissed the petition for certiorari and mandamus, holding that the
inclusion and deletion of overseas contract workers from the POEA
blacklist/watchlist were within the exclusive jurisdiction of the POEA to the
exclusion of the NLRC, and that the NLRC had no appellate jurisdiction to
review the matter. Likewise, the Rules and Regulations implementing RA
8042 reiterate the jurisdiction of POEA, thus: lιbrαrÿ
"Section 28. Jurisdiction of the POEA. The POEA shall exercise
original and exclusive jurisdiction to hear and decide:
a) All cases, which are administrative in character, involving or
arising out of violations of rules and regulations relating to licensing
and registration of recruitment and employment agencies or
entities; and
b) Disciplinary action cases and other special cases, which are
administrative in character, involving employers, principals, contracting
partners and Filipino migrant workers."law library
- Further, Sections 6 and 7 Rule VII, Book VII of the POEA Rules &
Regulations (1991) provide:
"Sec. 6. Disqualification of Contract Workers. Contract workers,
including seamen, against whom have been imposed or with
pending obligations imposed upon them through an order, decision
or resolution shall be included in the POEA Blacklist Workers shall
be disqualified from overseas employment unless properly cleared
by the Administration or until their suspension is served or lifted.
Sec. 7. Delisting of the Contract Worker s Name from the POEA
Watchlist. The name of an overseas worker may be excluded,
deleted and removed from the POEA Watchlist only after
disposition of the case by the Administration."
-It can be concluded from the afore-quoted law and rules that, public
respondent has no jurisdiction to review disciplinary cases decided by the
POEA involving contract workers. Clearly, the matter of inclusion and
deletion of overseas contract workers in the POEA Blacklist/Watchlist is
within the exclusive jurisdiction of the POEA to the exclusion of the public
respondent. Nor has the latter appellate jurisdiction to review the findings of
the POEA involving such cases.
- There was no grave abuse of discretion which can be imputed to the public
respondent when it issued the assailed Decision and Order, dismissing
petitioners appeal from the decision of the POEA.
ISSUE: Whether or not the NLRC has jurisdiction to review on appeal cases
decided by the POEA on matters pertaining to disciplinary actions against
private respondents.
HELD: NO. The petition for review lacks merit.
- Although Republic Act No. 8042, through its Section 10, transferred the
original and exclusive jurisdiction to hear and decide money claims involving
overseas Filipino workers from the POEA to the Labor Arbiters, the law did
not remove from the POEA the original and exclusive jurisdiction to hear and
24 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
decide all disciplinary action cases and other special cases administrative in
character involving such workers.
- When Republic Act No. 8042 withheld the appellate jurisdiction of the
NLRC in respect of cases decided by the POEA, the appellate jurisdiction
was vested in the Secretary of Labor in accordance with his power of
supervision and control under Section 38(1), Chapter 7, Title II, Book III of
the Revised Administrative Code of 1987.
- In conclusion, we hold that petitioners should have appealed the adverse
decision of the POEA to the Secretary of Labor instead of to the NLRC.
16. PETROLEUM SHIPPING LIMITED (former Esso Int’l Shipping) vs
NLRC
Facts: On 6 March 1978, Esso International Shipping (Bahamas) Co., Ltd.,
(“Esso”) through Trans-Global Maritime Agency, Inc. (“Trans-Global”) hired
Florello W. Tanchico (“Tanchico”) as First Assistant Engineer. In 1981,
Tanchico became Chief Engineer. On 13 October 1992, Tanchico returned
to the Philippines for a two-month vacation after completing his eight-month
deployment.
Tanchico underwent the required standard medical examination prior to
boarding the vessel. The medical examination revealed that Tanchico was
suffering from “Ischemic Heart Disease, Hypertensive Cardio-Muscular
Disease and Diabetes Mellitus.” Tanchico took medications for two months
and a subsequent stress test showed a negative result. However, Esso no
longer deployed Tanchico. Instead, Esso offered to pay him benefits under
the Career Employment Incentive Plan. Tanchico accepted the offer.
On 26 April 1993, Tanchico filed a complaint against Esso, Trans-Global and
Malayan Insurance Co., Inc. (“Malayan”) before the Philippine Overseas
Employment Administration (POEA) for illegal dismissal with claims for
backwages, separation pay, disability and medical benefits and 13th month
pay. In view of the enactment of Republic Act No. 8042 (“RA 8042”)4
transferring to the National Labor Relations Commission (NLRC) the
jurisdiction over money claims of overseas workers, the case was indorsed
to the Arbitration Branch of the National Capital Region.
Labor Arbiter—dismissed the complaint for lack of merit
 NLRC—affirmed the decision of the Labor Arbiter, upon filing a motion for
reconsideration NLRC reconsider its resolution.
On the claim of illegal dismissal, the same is unavailing as complainant had
been declared as one with partial permanent disability. Thus, he should be
entitled to disability benefit of 18 days for every year of credited service of
fourteen (14) years less the amount he already received under the
Company’s Disability Plan.
On the claim of 13th month pay, the respondent Agency not falling under the
enumerated exempted employers under P.D. 851 and in the absence of any
proof that respondent is already paying its employees a 13th month pay or
more in a calendar year, perforce, respondent agency should pay
complainant his monthly pay computed at [sic] the actual month [sic] worked,
which is 8 months.
CA—affirmed the decision of the NLRC
The Court of Appeals ruled that Tanchico was a regular employee of
Petroleum Shipping. The Court of Appeals held that petitioners are not
exempt from the coverage of Presidential Decree No. 851, as amended (PD
851)[11] which mandates the payment of 13th month pay to all employees.
The Court of Appeals further ruled that Tanchico is entitled to disability
benefits based on his 14 years of tenure with petitioners. The Court of
Appeals stated that the employer-employee relationship subsisted even
during the period of Tanchicos vacation. The Court of Appeals noted that
petitioners were aware of Tanchicos medical history yet they still deployed
him for 14 years. Finally, the Court of Appeals sustained the award of
attorneys fees.
Hence, this petition.
Issue:
1. Whether Tanchico is a regular employee of petitioners.
2. Whether Tanchico is entitled to 13th month pay.
Held:
2.
1. No, Tanchico is not a regular employee.
25 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
In Ravago v. Esso Eastern Marine, Ltd., the Court traced its ruling in a
number of cases that seafarers are contractual, not regular, employees.
Thus, in Brent School, Inc. v. Zamora, the Court cited overseas
employment contract as an example of contracts where the concept of
regular employment does not apply, whatever the nature of the engagement
and despite the provisions of Article 280 of the Labor Code. In Coyoca v.
NLRC, the Court held that the agency is liable for payment of a seamans
medical and disability benefits in the event that the principal fails or refuses
to pay the benefits or wages due the seaman although the seaman may not
be a regular employee of the agency.
In Millares v. NLRC, it is clear that seafarers are considered
contractual employees. They cannot be considered as regular
employees under Article 280 of the Labor Code. Their employment
is governed by the contracts they sign everytime they are rehired
and their employment is terminated when the contract expires.
Their employment is contractually fixed for a certain period of time.
They fall under the exception of Article 280 whose employment has
been fixed for a specific project or undertaking the completion or
termination of which has been determined at the time of
engagement of the employee or where the work or services to be
performed is seasonal in nature and the employment is for the
duration of the season. We need not depart from the rulings of the
Court in the two aforementioned cases which indeed constitute
stare decisis with respect to the employment status of seafarers.
Petitioners make much of the fact that they have been continually
re-hired or their contracts renewed before the contracts expired
(which has admittedly been going on for twenty (20) years).By such
circumstance they claim to have acquired regular status with all the
rights and benefits appurtenant to it.
Such contention is untenable. Undeniably, this circumstance of
continuous re-hiring was dictated by practical considerations that
experienced crew members are more preferred. Petitioners were
only given priority or preference because of their experience and
qualifications but this does not detract the fact that herein
petitioners are contractual employees. They cannot be considered
regular employees.
No, Tanchico is not entitle to 13th Month Pay. We do not agree with the
Court of Appeals. Again, Tanchico was a contractual, not a regular,
employee. Further, PD 851 does not apply to seafarers. The WHEREAS
clauses of PD 851 provides:
WHEREAS, it is necessary to further protect the level of real wages
from ravages of world-wide inflation;
WHEREAS, there has been no increase in the legal minimum wage
rates since 1970;
WHEREAS, the Christmas season is an opportune time for society
to show its concern for the plight of the working masses so they
may properly celebrate Christmas and New Year.
PD 851 contemplates the situation of land-based workers, and not of
seafarers who generally earn more than domestic land-based workers.
Tanchicos employment is governed by his Contract of Enlistment (Contract).
The Contract has been approved by the POEA in accordance with Title I,
Book One of the Labor Code and the POEA Rules Governing Employment.
The coverage of the Contract includes Compensation, Overtime, Sundays
and Holidays, Vacations, Living Allowance, Sickness, Injury and Death,
Transportation and Travel Expense, Subsistence and Living Quarters. It
does not provide for the payment of 13th month pay. The Contract of
Employment, which is the standard employment contract of the POEA,
likewise does not provide for the payment of 13th month pay.
17. GAGUI vs DEJERO
Facts: On 14 December 1993, respondents Simeon Dejero and Teodoro
Permejo filed separate Complaints for illegal dismissal, nonpayment of
salaries and overtime pay, refund of transportation expenses, damages, and
attorney fees against PRO Agency Manila, Inc., and Abdul Rahman Al
Mahwes.
Labor Arbiter—in favor of respondent, ordering Pro Agency Manila, Inc. and
Abdul Rahman Al Mahwes to jointly and severally pay the respondent. The
LA also issued a Writ of Execution. When the writ was returned unsatisfied,
an Alias Writ of Execution was issued, but was also returned unsatisfied.
Respondents filed a Motion to Implead Respondent Pro Agency Manila, Inc.
Corporate Officers and Directors as Judgment Debtor. It included petitioner
26 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
as the Vice-president/Stockholder/Director of PRO Agenct, Manila, Inc. The
LA granted the motion.
NLRC—denied the appeal.
NLRC denied the appeal for lack of merit. NLRC ruled that in so far as
overseas migrant workers are concerned, it is R.A. 8042 itself that describes
the nature of the liability of the corporation and its officers and directors. It is
not essential that the individual officers and directors be impleaded as party
respondents to the case instituted by the worker. A finding of liability on the
part of the corporation will necessarily mean the liability of the corporate
officers or directors.
CA--affirmed the decision of the NLRC.
Hence, this petition.
Issue: Whether or not petitioner may be held jointly and severally liable with
PRO Agency Manila, Inc. in accordance with Section 10 of R.A. 8042.
Held: The Petitioner may not be held jointly and severally liable.
LABOR LAW: liability of corporate officers
The pertinent portion of Section 10, R.A. 8042 reads as follows: The liability
of the principal/employer and the recruitment/placement agency for any and
all claims under this section shall be joint and several. This provision shall be
incorporated in the contract for overseas employment and shall be a
condition precedent for its approval.
In Sto. Tomas v. Salac, we had the opportunity to pass upon the
constitutionality of this provision. We have thus maintained: the Court has
already held, pending adjudication of this case, that the liability of corporate
directors and officers is not automatic. To make them jointly and solidarily
liable with their company, there must be a finding that they were remiss in
directing the affairs of that company, such as sponsoring or tolerating the
conduct of illegal activities.
Hence, for petitioner to be found jointly and solidarily liable, there must be a
separate finding that she was remiss in directing the affairs of the agency,
resulting in the illegal dismissal of respondents. Examination of the records
would reveal that there was no finding of neglect on the part of the petitioner
in directing the affairs of the agency. In fact, respondents made no mention
of any instance when petitioner allegedly failed to manage the agency in
accordance with law, thereby contributing to their illegal dismissal.
Petition for review on certiorari is GRANTED.
18. SANTIAGO vs CF Sharp Crew
Facts: Petitioner had been working as a seafarer for Smith Bell
Management, Inc. (respondent) for about 5 yrs. In February 3, 1998,
petitioner signed a new contract of employment with respondent, with the
duration of 9 months. The contract was approved by POEA. Petitioner was
to be deployed on board the “MSV Seaspread” which was scheduled to
leave the port of Manila for Canada on 13 February 1998.
A week before the date of departure, Capt. Pacifico Fernandez, respondent’s
Vice President, sent a facsimile message to the captain of “MSV
Seaspread,”, saying that it received a phone call from Santiago’s wife and
some other callers who did not reveal their identity and gave him some
feedbacks that Paul Santiago this time, if allowed to depart, will jump ship in
Canada like his brother Christopher Santiago. The captain of “MSV
Seaspread replied that it cancel plans for Santiago to return to Seaspread.
Petitioner thus told that he would not be leaving for Canada anymore.
Petitioner filed a complaint for illegal dismissal, damages, and attorney’s
fees against respondent and its foreign principal, Cable and Wireless
(Marine) Ltd.
Labor Arbiter—in favor of Petitioner Santiago
LA ruled that the employment contract remained valid but had not
commenced since petitioner was not deployed and that respondent violated
the rules and regulations governing overseas employment when it did not
deploy petitioner, causing petitioner to suffer actual damages.
NLRC—in favor of Respondent.
NLRC ruled that there is no employer-employee relationship between
petitioner and respondent because the employment contract shall
commence upon actual departure of the seafarer from the airport or seaport
at the point of hire and with a POEA-approved contract. In the absence of an
27 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
employer-employee relationship between the parties, the claims for illegal
dismissal, actual damages, and attorney’s fees should be dismissed. But the
NLRC found respondent’s decision not to deploy petitioner to be a valid
exercise of its management prerogative.
CA—affirmed the decision of the NLRC.
Hence, this petition.
Issue: When does an employer-employee relationship begin in the case at
bar.
Held: There is some merit in the petition. The parties entered into an
employment contract whereby petitioner was contracted by respondent to
render services on board “MSV Seaspread” for the consideration of
US$515.00 per month for 9 months, plus overtime pay. However,
respondent failed to deploy petitioner from the port of Manila to Canada.
Considering that petitioner was not able to depart from the airport or seaport
in the point of hire, the employment contract did not commence, and no
employer-employee relationship was created between the parties. However,
a distinction must be made between the perfection of the employment
contract and the commencement of the employer-employee relationship.
The perfection of the contract, which in this case coincided with the date of
execution thereof, occurred when petitioner and respondent agreed on the
object and the cause, as well as the rest of the terms and conditions therein.
The commencement of the employer-employee relationship would have
taken place had petitioner been actually deployed from the point of hire.
Thus, even before the start of any employer-employee relationship,
contemporaneous with the perfection of the employment contract was the
birth of certain rights and obligations, the breach of which may give rise to a
cause of action against the erring party. Thus, if the reverse had happened,
that is the seafarer failed or refused to be deployed as agreed upon, he
would be liable for damages.
Neither the manning agent nor the employer can simply prevent a seafarer
from being deployed without a valid reason. Respondent’s act of preventing
petitioner from departing the port of Manila and boarding “MSV Seaspread”
constitutes a breach of contract, giving rise to petitioner’s cause of action.
Respondent unilaterally and unreasonably reneged on its obligation to
deploy petitioner and must therefore answer for the actual damages he
suffered.
Despite the absence of an employer-employee relationship between
petitioner and respondent, the Court rules that the NLRC has jurisdiction
over petitioner’s complaint. The jurisdiction of labor arbiters is not limited to
claims arising from employer-employee relationships. Section 10 of R.A. No.
8042 (Migrant Workers Act), provides that:
Sec. 10. Money Claims. – Notwithstanding any provision of law to the
contrary, the Labor Arbiters of the NLR) shall have the original and exclusive
jurisdiction to hear and decide, within 90 calendar days after the filing of the
complaint, the claims arising out of an employer-employee relationship or by
virtue of any law or contract involving Filipino workers for overseas
deployment including claims for actual, moral, exemplary and other forms of
damages.”
Since the present petition involves the employment contract entered into by
petitioner for overseas employment, his claims are cognizable by the labor
arbiters of the NLRC.
Respondent is liable to pay petitioner only the actual damages in the form of
the loss of nine (9) months’ worth of salary as provided in the contract. He is
not, however, entitled to overtime pay. While the contract indicated a fixed
overtime pay, it is not a guarantee that he would receive said amount
regardless of whether or not he rendered overtime work. Even though
petitioner was prevented without valid reason from rendering regular much
less overtime service, the fact remains that there is no certainty that
petitioner will perform overtime work had he been allowed to board the
vessel. The amount stipulated in the contract will be paid only if and when
the employee rendered overtime work. Realistically speaking, a seaman, by
the very nature of his job, stays on board a ship or vessel beyond the regular
eight-hour work schedule. For the employer to give him overtime pay for the
extra hours when he might be sleeping or attending to his personal chores or
even just lulling away his time would be extremely unfair and unreasonable.
The Court also holds that petitioner is entitled to attorney’s fees in the
concept of damages and expenses of litigation. Respondent’s basis for not
deploying petitioner is the belief that he will jump ship just like his brother, a
mere suspicion that is based on alleged phone calls of several persons
whose identities were not even confirmed. This Court has upheld
management prerogatives so long as they are exercised in good faith for the
advancement of the employer’s interest and not for the purpose of defeating
or circumventing the rights of the employees under special laws or under
valid agreements. Respondent’s failure to deploy petitioner is unfounded and
unreasonable However, moral damages cannot be awarded in this case.
28 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
Because respondent’s action was not tainted with bad faith, or done
deliberately to defeat petitioner’s rights, as to justify the award of moral
damages.
Seafarers are considered contractual employees and cannot be considered
as regular employees under the Labor Code. Their employment is governed
by the contracts they sign every time they are rehired and their employment
is terminated when the contract expires. The exigencies of their work
necessitates that they be employed on a contractual basis.
19 CF SHARP & CO. vs PIONEER INSURANCE
Facts: Responding to a newspaper advertisement of a job opening for
sandblasters and painters in Libya, respondents Wilfredo C. Agustin and
Hernando G. Minimo applied with C.F. Sharp sometime in August 1990.
After passing the interview, they were required to submit their passports,
seamans book, National Bureau of Investigation clearance, employment
certificates, certificates of seminars attended, and results of medical
examination. Upon submission of the requirements, a Contract of
Employment was executed between respondents and C.F. Sharp.
Thereafter, respondents were required to attend various seminars, open a
bank account with the corresponding allotment slips, and attend a pre-
departure orientation. They were then advised to prepare for immediate
deployment and to report to C.F. Sharp to ascertain the schedule of their
deployment.
After a month, respondents were yet to be deployed prompting them to
request for the release of the documents they had submitted to C.F. Sharp.
C.F. Sharp allegedly refused to surrender the documents which led to the
filing of a complaint by respondents before the Philippine Overseas
Employment Administration (POEA) on 21 January 1991.
POEA issued an Order finding C.F. Sharp guilty of violation of Article 34(k) of
the Labor Code, which makes it unlawful for any entity to withhold or deny
travel documents from applicant workers before departure for monetary or
financial considerations other than those authorized under this Code and its
implementing rules and regulations. Consequently, C.F. Sharps license was
suspended until the return of the disputed documents to respondents. POEA
likewise declared that it has no jurisdiction to adjudicate the monetary claims
of respondents.
Respondents filed a Complaint for breach of contract and damages against
C.F. Sharp and its surety, Pioneer Insurance and Surety Corporation
 (Pioneer Insurance), before the Regional Trial Court (RTC) of Pasay City.
Respondents claimed that C.F. Sharp falsely assured them of deployment
and that its refusal to release the disputed documents on the ground that
they were already bound by reason of the Contract of Employment, denied
respondents of employment opportunities abroad and a guaranteed income.
Respondents also prayed for damages. Pioneer Insurance filed a cross
claim against C.F. Sharp and John J. Rocha, the executive vice-president of
C.F. Sharp, based on an Indemnity Agreement which substantially provides
that the duo shall jointly and severally indemnify Pioneer Insurance for
damages, losses, and costs which the latter may incur as surety.
RTC—in favor of respondents
WHEREFORE, plaintiffs causes of action having been
proved with a preponderance of evidence, judgment is hereby
ordered as follows:
a. Declaring the non-deployment of plaintiffs and the refusal to
release documents as breach of contract;
b. By way of compensatory damages, awarding $450 per month
and $439 overtime per month, which should have been received
by plaintiffs from other employers, making a joint and solidary
obligation on the part of the two defendants C.F. Sharp and
Pioneer for the period covered by the employment contracts;
c. Ordering each defendant to pay each plaintiff P50,000.00 as
moral damages and another P50,000.00 each as exemplary
damages;
d. Ordering defendants to share in the payment to plaintiffs of
P50,000.00 attorneys fees;
e. Defendants to pay litigation expenses and costs of suit.
The trial court ruled that there was a violation of the contract when
C.F. Sharp failed to deploy and release the papers and documents
of respondents, hence, they are entitled to damages. The trial
court likewise upheld the cause of action of respondents against
Pioneer Insurance, the former being the actual beneficiaries of the
surety bond.
29 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
Upon appeal, petitioner raised the issue of RTC’s jurisdiction over the case.
Petitioner argued that POEA has jurisdiction over all cases including money
claims, arising out of or by virtue of any contract involving workers for
overseas employment pursuant to pursuant to Section 4(a) of Executive
Order No. 797.
CA—upheld the jurisdiction of the RTC.
Upheld the jurisdiction of the trial court by ruling that petitioners are now
estopped from raising such question because they have actively participated
in the proceedings before the trial court. The Court of Appeals further held
that since there is no perfected employment contract between the parties, it
is the RTC and not the POEA, whose jurisdiction pertains only to claims
arising from contracts involving Filipino seamen, which has jurisdiction over
the instant case.
Despite the finding that no contract was perfected between the parties, the
Court of Appeals adjudged C.F. Sharp and Rocha liable for damages. The
Court of Appeals limited the liability of Pioneer Insurance to the amount of
P150,000.00 pursuant to the Contract of Suretyship between C.F. Sharp and
Pioneer Insurance.
Rocha filed the instant petition on the submission that there is no basis to
hold him liable for damages under Article 21 of the Civil Code because C.F.
Sharp has signified its intention to return the documents and had in fact
informed respondents that they may, at any time of the business day,
withdraw their documents.
Respondents maintain that they are entitled to damages under Article 21 of
the Civil Code for C.F. Sharps unjustified refusal to release the documents to
them and for requiring them to sign a quitclaim which would effectively bar
them from seeking redress against petitioners. Respondents justify the
award of other damages as they suffered pecuniary losses attributable to
petitione’rs malice and bad faith.
Issue: Whether or not Respondents are entitled to damages.
Held: Yes, Respondents are entitled to damages.
The court sustained the ruling of the trial court. The bases of the lower courts
award of damages differ. In upholding the perfection of contract between
respondents and C.F. Sharp, the trial court stated that the unjustified failure
to deploy and subsequently release the documents of respondents entitled
them to compensatory damages, among others. Differently, the appellate
court found that no contract was perfected between the parties that will give
rise to a breach of contract. Thus, the appellate court deleted the award of
actual damages. However, it adjudged other damages against C.F. Sharp for
its unlawful withholding of documents from respondents.
C.F. Sharp committed an actionable wrong when it unreasonably withheld
documents, thus preventing respondents from seeking lucrative employment
elsewhere. That C.F. Sharp arbitrarily imposed a condition that the
documents would only be released upon signing of a quitclaim is tantamount
to bad faith because it effectively deprived respondents of resort to legal
remedies.
Furthermore, we affirm the award of exemplary damages and attorney’s
fees. Exemplary damages may be awarded when a wrongful act is
accompanied by bad faith or when the defendant acted in a wanton,
fraudulent, reckless, oppressive, or malevolent manner which would justify
an award of exemplary damages under Article 2232 of the Civil Code. Since
the award of exemplary damages is proper in this case, attorney’s fees and
cost of the suit may also be recovered as provided under Article 2208 of the
Civil Code.
20. SUNACE INTERNATIONAL MANAGEMENT SERVICES v. NLRC
FACTS: Petitioner, a domestic corporation, deployed to Taiwan Divina A.
Montehermozo as a domestic helper under a 12-month contract effective
February 1, 1997. The deployment was with the assistance of a Taiwanese
broker, Edmund Wang, President of Jet Crown International Co., Ltd. After
the expiration of her contract, Divina continued working for her Taiwanese
employer Hang Rui Xiong, for 2 more years, after which she returned to the
Philippines on February 4, 2000.
Shortly after her return, Divina filed a complaint before the NLRC
against Sunace, one Adelaide Perez, the Taiwanese broker, and the
employer-foreign principal alleging that she was jailed for three months and
that she was underpaid. The following day, the Labor Arbitration Associate
issued summons to the Manager of Petitioner.
Divina filed her Position Paper claiming that under her original one-
year contract and the 2-year extended contract which was with the
knowledge and consent of Sunace and while the amounts deducted in 1997
were refunded to her, those deducted in 1998 and 1999 were not.
30 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
Petitioner filed answer to complainant’s position paper alleging that
Divina’s 2-year extension of her contract was without its knowledge and
consent, hence, it had no liability attaching to any claim arising therefrom,
and Divina in fact executed a Waiver/Quitclaim and Release of
Responsibility and an Affidavit of Desistance.
 Labor Arbiter – rejected Petitioner’s contention that the 2-yr extension of
contract of Divina was without its knowledge
 NLRC – affirmed LA’s decision
ISSUE: WON Petitioner knew of and impliedly consented to the extension of
Divina’s 2 yr contract?
RULING: No, Petitioner has no knowledge or even expressed implied
consent to the extension of Divina’s contract. The finding of the Court of
Appeals solely on the basis of the above-quoted telefax message that
Sunace continually communicated with the foreign principal and therefore
was aware of and had consented to the execution of the extension of the
contract is misplaced. The message does not provide evidence that Sunace
was privy to the new contract executed after the expiration on February 1,
1998 of the original contract. That Sunace and the Taiwanese broker
communicated regarding Divina’s allegedly withheld savings does not
necessarily mean that Sunace ratified the extension of the contract.
The theory of imputed knowledge ascribes the knowledge of the
agent, Sunace, to the principal, employer Xiong, not the other way around
The knowledge of the principal-foreign employer cannot, therefore, be
imputed to its agent Sunace.
Thus, there being no substantial proof that Sunace knew of and
consented to be bound under the 2-year employment contract extension, it
cannot be said to be privy thereto. As such, it and its owner cannot be held
solidarily liable for any of Divinas claims arising from the 2-year employment
extension.
21. WALL EM MARITIME SERVICES INC v. TANAWAN
FACTS: Petitioner, acting as local agent of Scandic Ship Management, Ltd.,
engaged Ernesto C. Tanawan as dozer driver assigned to the vessel, M/V
Eastern Falcon, for a period of 12 months. Under the employment contract,
Tanawan was entitled to a basic salary of US$355.00/month, overtime pay of
US$2.13/hour, and vacation leave pay of US$35.00/month. While Tanawan
 was assisting 2 co-workers in lifting a steel plate aboard the vessel, a corner
of the steel plate touched the floor of the deck, causing the sling to slide and
the steel plate to hit his left foot. He was brought to a hospital in Malaysia
where his left foot was placed in a cast. His x-ray examination showed he
had suffered multiple left toes fracture.
On May 21, 1998, conformably with the orthopedic surgeon’s
findings, Dr. Lim reported that Tanawan was already asymptomatic and
pronounced him fit to work. It is noted that from November 30, 1997 until
April 1998, Tanawan was paid sickness allowances equivalent to his monthly
salary.
On August 25, 1998, due to the worsening condition of his right
eye, Tanawan also went to the clinic of Dr. Hernando D. Bunuan for a
disability evaluation, not of his foot injury but of an eye injury that he had
supposedly sustained while on board the vessel. This injury was incurred
when he was opening a can of thinner, some of the thinner accidentally
splashed into his right eye; that he was rushed to the Office of the Chief
Mate for emergency treatment; and that the ship doctor examined him five
days later, and told him that there was nothing to worry about and that he
could continue working.
Tanawan filed in the Arbitration Branch of the NLRC a complaint for
disability benefits for the foot and eye injuries, sickness allowance, damages
and attorney’s fees against the petitioner and its foreign principal.
Petitioner denied Tanawan’s claim for disability benefits for his foot
injury, averring that he was already fit to work based on Dr. Lim’s
certification; that he did not sustain the alleged eye injury while on board the
vessel because no such injury was reported;16 that the claim for sickness
allowance was already paid when he underwent treatment.
 LA – ruled in favour of Tanawan; found sufficient evidence to support
Tanawan’s claim for disability benefits for the foot and eye injuries, according
credence to the medical certificate issued by Dr. Saguin classifying
Tanawan’s foot injury as Grade 12; Tanawan’s declaration —which was not
contradicted by the petitioner—that some paint thinner splashed into his right
eye on October 5, 1997; and the letter of Dr. Bunuan to the effect that the
disability due to the eye injury was classified as Grade 7.
 NLRC – reversed LA’s decision
 CA – in favour of Tanawan; discoursed that what was being compensated in
disability compensation was not the injury but the incapacity to work; that
considering that the foot injury incapacitated Tanawan from further working
31 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
as dozer driver for the petitioner’s principal, he should be given disability
benefits; that Dr. Lim’s certification had no probative weight because it was
selfserving and biased in favor of the petitioner; that Tanawan’s claim for the
eye injury was warranted because the injury occurred during the term of the
employment contract; and that an injury, to be compensable, need not be
work-connected.
ISSUE/s:
1. WON the Standard Employment Contract of the POEA is the law between
the Seaman and the Manning Agent?
2. WON a company designated physician possess the legal authority to declare
a seaman fit to work?
3. WON a seaman can claim disability benefits after he failed to report the
injury within the 3 day reglementary period?
RULING:
1. Yes. The employment of seafarers, and its incidents, including claims for
death benefits, are governed by the contracts they sign every time they are
hired or rehired. Such contracts have the force of law between the parties as
long as their stipulations are not contrary to law, morals, public order or
public policy. While the seafarers and their employers are governed by their
mutual agreements, the POEA rules and regulations require that the POEA
SEC, which contains the standard terms and conditions of the seafarers’
employment in foreign ocean-going vessels, be integrated in every
seafarer’s contract.
2. Yes. The last paragraph of Sec 20(B) of their contract legally gives the
company’s designated physician the authority to determine whether the
seaman is fit to work or not. But the assessment of the company designated
physician is not final, binding or conclusive on the seafarer, the labor
tribunals, or the courts. The seafarer may request a second opinion and
consult a physician of his choice regarding his ailment or injury, and the
medical report issued by the physician of his choice shall also be evaluated
on its inherent merit by the labor tribunal and the court.
3. No. Tanawan’s claim for disability benefits due to the eye injury was already
barred by his failure to report the injury and to have his eye examined by a
company-designated physician.The rationale for the rule is that reporting the
illness or injury within three days from repatriation fairly makes it easier for a
physician to determine the cause of the illness or injury. Ascertaining the real
cause of the illness or injury beyond the period may prove difficult. To ignore
the rule might set a precedent with negative repercussions, like opening the
floodgates to a limitless number of seafarers claiming disability benefits, or
causing unfairness to the employer who would have difficulty determining the
cause of a claimant’s illness because of the passage of time. The employer
would then have no protection against unrelated disability claims.
Note: Yung sa foot injuries, naproved niyang totoo talaga. Pero yung sa
eyes, walang sufficient proof presented.
22. LEONIS NAVIGATION v. VILLAMASTER
FACTS: Private respondent Villamater was hired as Chief Engineer for the
ship MV Nord Monaco, owned by Petitioner World Marine Panama, S.A.,
through the services of Petitioner as the latter’s local manning agent.
Consequent to this employment, Villamater, on June 4, 2002, executed an
employment contract, incorporating the Standard Terms and Conditions
Governing the Employment of Filipino Seafarers on Board Ocean-Going
Vessels as prescribed by the POEA. Prior to his deployment, Villamater
underwent the required Pre-Employment Medical Examination (PEME). He
passed the PEME and was declared Fit to Work. Thereafter, Villamater was
deployed on June 26, 2002.
4 months after his deployment, Villamater suffered intestinal
bleeding and was given a blood transfusion. Thereafter, he again felt weak,
lost considerable weight, and suffered intermittent intestinal pain. He
consulted a physician in Hamburg, Germany, who advised hospital
confinement. Villamater was diagnosed with Obstructive Adenocarcinoma of
the Sigmoid, with multiple liver metastases, possibly local peritoneal
carcinosis and infiltration of the bladder, possibly lung metastasis, and
anemia; Candida Esophagitis; and Chronic Gastritis. He was advised to
undergo chemotherapy and continuous supportive treatment, such as pain-
killers and blood transfusion.
Villamater was later repatriated, under medical escort, as soon as
he was deemed fit to travel. As soon as he arrived in the Philippines,
Villamater was referred to company-designated physicians. The diagnosis
and the recommended treatment abroad were confirmed. He was advised to
undergo 6 cycles of chemotherapy. However, Dr. Kelly Siy Salvador, one of
the company-designated physicians, opined that Villamaters condition
appears to be not work-related, but suggested a disability grading of 1.
When no noticeable improvement occurred, Villamater filed a
complaintbefore the Arbitration Branch of the NLRC for payment of
permanent and total disability benefits, reimbursement of medical and
hospitalization expenses, moral and exemplary damages and atty’s fees.
32 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
 LA – in favour of Villamater
ISSUE/S:
1. Is Villamater entitled to total and permanent disability benefits by reason of
his colon cancer?
2. If yes, would he also be entitled to attorneys fees?
RULING:
1. Yes. The Court held that it is manifest that the interplay of age, hereditary,
and dietary factors contributed to the development of colon cancer. By the
time he signed his employment contract on June 4, 2002, he was already 58
years old, having been born on October 5, 1943, an age at which the
incidence of colon cancer is more likely. He had a familial history of colon
cancer, with a brother who succumbed to death and an uncle who
underwent surgery for the same illness. Both the Labor Arbiter and the
NLRC found his illness to be compensable for permanent and total disability,
because they found that his dietary provisions while at sea increased his risk
of contracting colon cancer because he had no choice of what to eat on
board except those provided on the vessels and these consisted mainly of
high-fat, high-cholesterol, and low-fiber foods.
2. Yes. By reason of Villamaters entitlement to total and permanent disability
benefits, he (or in this case his widow Sonia) is also entitled to the award of
attorney’s fees, not under Article 2208(2) of the Civil Code, [w]hen the
defendants act or omission has compelled the plaintiff to litigate with third
persons or to incur expenses to protect his interest, but under Article 2208(8)
of the same Code, involving actions for indemnity under workmens
compensation and employers liability laws.
23. PEOPLE v. PANIS
FACTS: Private Respondent, Serapio Abug, without first securing a license
from the Ministry of Labor as a holder of authority to operate a fee-charging
employment agency, operate a private fee charging employment agency by
charging fees and expenses (from) and promising employment in Saudi
Arabia to four separate individuals named therein, in violation of Article 16 in
relation to Article 39 of the Labor Code.
Abug filed a motion to quash on the ground that the information did
not charge an offense because he was accused of illegally recruiting only
one person in each of the four information. Under the proviso in Article 13(b),
 he claimed, there would be illegal recruitment only "whenever two or more
persons are in any manner promised or offered any employment for a fee.
ISSUE: WON the requirement of two or more persons is imposed only where
the recruitment and placement consists of an offer or promise of employment
to such persons and always in consideration of a fee?
RULING: No. The number of persons dealt with is not an essential
ingredient of the act of recruitment and placement of workers. Any of the
acts mentioned in the basic rule in Article 13(b) win constitute recruitment
and placement even if only one prospective worker is involved. The proviso
merely lays down a rule of evidence that where a fee is collected in
consideration of a promise or offer of employment to two or more
prospective workers, the individual or entity dealing with them shall be
deemed to be engaged in the act of recruitment and placement. The words
"shall be deemed" create that presumption.
24. C.F. Sharp Crew Management, Inc. vs. Espanol, Jr.
G.R. No. 155903. September 14, 2007
FACTS: In 1991, Louis Cruise Lines (LCL), a foreign corporation duly
organized and existing under the laws of Cyprus, entered into a Crewing
Agreement with Papadopolous Shipping, Ltd. (PAPASHIP). PAPASHIP
appointed Rizal International Shipping Services (Rizal) as manning agency
in the Philippines, recruiting Filipino seamen for LCL’s vessel.
On October 1996, LCL terminated the Crewing Agreement with
PAPASHIP to take effect on December 31, 1996. It appointed C.F. Sharp as
crewing agent in the Philippines. C.F. Sharp requested for accreditation as
the new manning agency of LCL with the POEA, but Rizal objected on the
ground that its accreditation still existed and would only expire on December
31, 1996.
Pending accreditation, Theodoros Savva and AdriasTjiakouris of
LCL arrived in the Philippines and conducted a series of interviews for
seafarers at C.F. Sharp’s office. Rizal reported LCL’s recruitment activities to
the POEA on December 9, 1996, and requested an ocular inspection of C.F.
Sharp’s premises.
POEA representatives conducted an inspection and found Savva
and Tjiakouris at C.F. Sharp interviewing and recruiting hotel staffs, cooks,
33 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
and chefs for M/V Cyprus, with scheduled deployment in January 1997.
Inspection Report was submitted to POEA.
On January 2, 1997, Rizal filed a complaint for illegal recruitment,
cancellation or revocation of license, and blacklisting against LCL and C.F.
Sharp with the POEA. It filed a Supplemental Complaint7 adding violation of
Section 29 of the Labor Code of the Philippines, for designating and/or
appointing agents, representatives and employees, without prior approval
from the POEA.
C.F. Sharp admitted to having conducted interviews but denied that
they were for recruitment or selection purposes. Instead they were interviews
for LCL’s ex-crew members who had various complaints against Rizal.
POEA Administrator:
1. C.F. Sharp liable for illegal recruitment as per report (conducting
interviews without any authority from POEA.)
2. It violated Section 29 of the Labor Code when it designated officers and
agents without prior approval of the POEA.
[Hence, it was suspended for 6months or P50K for violation of Art 29 in rel.
to Sec 6(b) Rule II, Book II of RR Governing Overseas Employment. And 18
months or P180K for 9 counts of violation of Art 29 of the LC in rel. to Sec.
2(k), Rule I, Book VI RR Governing Overseas Employment]
Secretary of Labor Leonardo A. Quisumbing: AFFIRMED.
CF Sharp elevated the case to SC. SC referred the petition to CA.
CA: Denied the petition. CF Sharp was already estopped from assailing the
Secretary of Labor’s ruling because by paying the adjudged fines, it
effectively executed the judgment. CA agreed with the POEA Administrator
and Sec. of Labor on finding CF Sharp in violation of Art. 29 of the LC.
MR Denied. Hence, this appeal.
ISSUES:
1.Whether or not CF Sharp is liable for illegal recruitment
CF Sharp: contends that the interviews conducted were not for selection
and recruitment purposes, but were in connection with the seamen’s past
employment with Rizal, specifically, their complaints for non-remittance of
SSS premiums, withholding of wages, illegal exactions from medical
examinations and delayed allotments.
RULING: YES. Undoubtedly, in December 1996, LCL had no approved
POEA license
to recruit. C.F. Sharp’s accreditation as LCL’s new manning agency was still
pending approval at that time. Yet Savva and Tjiakouris, along with C.F.
Sharp, entertained applicants for LCL’s vessels, and conducted preparatory
interviews.
Article 13(b) of the Labor Code defines recruitment and placement as:
“any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or
procuring workers, and includes referrals, contract services, promising or
advertising for employment, locally or abroad whether for profit or not:
Provided, That any person or entity which in any manner, offers or promises
for a fee employment to two or more persons shall be deemed engaged in
recruitment and placement.”
On the basis of this definition—and contrary to what C.F. Sharp wants to
portray—the conduct of preparatory interviews is a recruitment activity. The
fact that C.F. Sharp did not receive any payment during the interviews is of
no moment. From the language of Article 13(b), the act of recruitment may
be “for profit or not.” Notably, it is the lack of the necessary license or
authority, not the fact of payment, that renders the recruitment activity of LCL
unlawful.
It was Savva and Tjiakouris that conducted the interviews, and undertook
selection and hiring. However, C.F. Sharp cannot steer clear of liability for it
conspired with LCL in committing illegal recruitment activities.
2. Whether or not CF Sharp violated Art. 29 of the LC?
34 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
YES. Desiderio’s name does not appear in the list of employees and officials
submitted by C.F. Sharp to the POEA. However, his name appeared as the
contact person of the applicants for the position of 2nd and 3rd assistant
engineers and machinist/fitter in C.F Sharp’s advertisement in the February
2, 1997 issue of The Bulletin Today.
Art. 29 provides:
No license or authority shall be used directly or indirectly by any person
other than the one in whose favor it was issued or at any place other than
that stated in the license or authority, nor may such license or authority be
ntransferred, conveyed or assigned to any other person or entity. Any
transfer of business address, appointment or designation of any agent or
representative including the establishment of additional offices anywhere
shall be subject to the prior approval of the Department of Labor.”
The appointment or designation of Desiderio as an employee or agent of
C.F. Sharp, without prior approval from the POEA, warrants administrative
sanction.
25. People vs. Nogra
G.R. No. 170834. August 29, 2008
FACTS: Antonio Nogra held office at Loran International Overseas
Recruitment Co., (Loran) in Concepcion Grande, Naga City. A nameplate on
his table, his license, and POEA files reflect his position as operations
manager of Loran.
In 1996, Renato Alden went to Loran to apply for a job as hotel worker for
Saipan. He was interviewed was required to submit an NBI clearance and
medical certificate and to pay the placement fee. Alden paid the amount of
P31,000.00. The additional amount of P4,000.00 was to be paid prior to his
departure to Saipan. He promised Alden that he would leave within a period
of three to four months. But after one year, Alden wasn’t able to leave.
Hence, he filed a complaint with the NBI when he was not able to recover
the money and could no longer talk with appellant.
In 1997, Teofila Lualhati applied for employment as hotel worker for Saipan
with Loran. She submitted an NBI clearance and medical certificate and paid
P35,000.00. She was promised that within 120 days or 4 months she would
be able to leave. Lualhati was unable to work in Saipan. She demanded the
refund of the processing fee. When the amount was not returned to her, she
filed a complaint with the NBI.
In 1998, Filipina Mendoza went to Loran to apply for employment as hotel
worker. She paid the amount of P35,000.00 as placement fee. When she
was not able to work abroad, she went to Loran and sought the return of
P35,000.00 from Nogra.
In 1997, Kerwin Donacao went to Loran to apply for employment as
purchaser in Saipan. He paid the placement fee of P35,000.00. After paying
the amount, he was told to wait for two to three months. When he was not
able to leave for Saipan, he demanded the return of the placement fee,
which was not refunded.
Annelyn Sarmiento and her husband, Oliver Sarmiento, applied for overseas
employment.
They submitted his medical certificate and certification of previous
employment. They paid P27,000.00 as processing fee. Oliver Sarmiento was
promised that within 1 month, he would be able to leave. Initially, Oliver
Sarmiento was told that allegedly his visa was yet to be obtained. When he
was not able to leave and what he paid was not refunded, he filed a
complaint with the NBI.
It was established from the testimonies of Nogra and agency’s secretary
Maritess Mesina that Loran was owned by Lorna Orciga and Kataru Tanaka.
That Nogra applied as a liaison officer but was given the operations manager
position as the agency was still in the process of completing the list of
personnel.
RTC rendered Judgment7 finding appellant guilty beyond reasonable doubt
of the crime of Illegal Recruitment Committed in Large Scale as defined in
The Migrant Workers and Overseas Filipinos Act of 1995.
CA affirmed. The CA held that being an employee is not a valid defense
since employees who have knowledge and active participation in the
recruitment activities may be criminally liable for illegal recruitment activities.
Hence, this petition.
NOGRA: The agency was under the management and control of Orciga, and
that he was a mere employee; that he could not be held personally liable for
35 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
illegal recruitment in the absence of any showing that he was validly issued
special authority to recruit workers, which was approved by the POEA.
ISSUE: Whether Nogra can be held liable for Illegal Recruitment in
Large Scale
RULING: Yes.
The penultimate paragraph of Section 6 of R.A. No. 8042 explicitly states
that those criminally liable are the “principals, accomplices, and accessories.
In case of juridical persons, the officers having control, management or
direction of their business shall be liable.”
Contrary to appellant’s claim, the testimonies of the complaining witnesses
and the documentary evidence for the prosecution clearly established that
he was not a mere employee of Loran, but its Operations Manager. The
license of Loran, the files of the POEA and the nameplate prominently
displayed on his office desk reflected his position as Operations Manager.
As such, he received private complainants’ job applications; and interviewed
and informed them of the agency’s requirements prior to their deployment,
such as NBI clearance, police clearance, medical certificate, previous
employment certificate and the payment of placement fee. He was also
responsible for the radio advertisements and leaflets, which enticed
complaining witnesses to apply for employment with the agency. Clearly, as
Operations Manager, he was in the forefront of the recruitment activities.
Extent of liability:
Nogra was charged with illegal recruitment in large scale under Section 6 (l)
and (m) of R.A. No. 8042. Section 6 (l) refers to the failure to actually deploy
without valid reason, as determined by the Department of Labor and
Employment (DOLE). Section 6 (m) involves the failure to reimburse
expenses incurred by the worker in connection with his documentation and
processing for purposes of deployment, in cases in which the deployment
does not actually take place without the worker’s fault.
A thorough scrutiny of the prosecution’s evidence reveals that it failed to
prove Nogra’s liability under Section 6 (l) of R.A. No. 8042. The law requires
not only that the failure to deploy be without valid reason “as determined by
the Department of Labor and Employment.” The law envisions that there be
independent evidence from the DOLE to establish the reason for non-
deployment, such as the absence of a proper job order. No document from
the DOLE was presented in the present case to establish the reason for the
accused’s failure to actually deploy private complainants. Thus, Nogra
cannot be held liable under Section 6 (l) of R.A. No. 8042.
As to Section 6 (m) of R.A. No. 8042, the prosecution has proven beyond
reasonable doubt that private complainants made payments to Loran, and
appellant failed to reimburse the amounts paid by private complainants when
they were not deployed.
26. Dagasdas vs. Grand Placement and General Services Corp.
G.R. No. 205727
FACTS: Grand Placement and General Services Corp. (GPGS) is a licensed
recruitment or placement agency in the Philippines while Saudi Aramco
(Aramco) is its counterpart in Saudi Arabia. Industrial & Management
Technology Methods Co. Ltd. (ITM) is the principal of GPGS, a
company existing in Saudi Arabia.
GPGS, for and on behalf of ITM, employed Dagasdas as Network
Technician. He was to be
deployed in Saudi Arabia under a one-year contract. Before leaving the
Philippines, Dagasdas underwent skill training and pre-departure orientation
as Network Technician. Nonetheless, his Job Offer indicated that he was
accepted by Aramco and ITM for the position of "Supt."
Dagasdas contended that although his position under his contract was as a
Network Technician, he actually applied for and was engaged as a Civil
Engineer. Purportedly the position of Network Technician was only for the
purpose of securing a visa for Saudi Arabia because ITM could not support
visa application for Civil Engineers.
Dagasdas arrived in Saudi Arabia.Thereafter, he signed with ITM a new
employment contract which stipulated that the latter contracted him as
Superintendent or in any capacity within the scope of his abilities with salary
of SR5,112.00 and allowance of SR2,045.00 per month. Under this contract,
Dagasdas shall be placed under a three-month probationary period; and, this
new contract shall cancel all contracts prior to its date from any source.
Dagasdas reported at ITM's worksite in Khurais, Saudi Arabia. There, he
was allegedly given tasks suited for a Mechanical Engineer. Later, he was
36 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
transferred to the Civil Engineering Department, was temporarily given a
position as Civil Construction Engineer, and was issued an identification card
good for one month. Thereafter, he was directed to exit the worksite but
Rashid H. Siddiqui (Siddiqui), the Site Coordinator Manager, advised him to
remain in the premises, and promised to secure him the position he applied
for. However, before Dagasdas' case was investigated, Siddiqui had severed
him the position he applied for.
Dagasdas returned to Al-Khobar and stayed at the ITM Office. Later gave
him a termination
notice indicating that his last day of work was on April 30, 2008, and he was
dismissed pursuant to clause 17.4.3 of his contract, which provided that ITM
reserved the right to terminate any employee within the three-month
probationary period without need of any notice to the employee.
Before his repatriation, Dagasdas signed a Statement of Quitclaim with Final
Settlement stating that ITM paid him all the salaries and benefits for his
services from February 11, 2008 to April 30, 2008 in the total amount of
SR7,156.80, and ITM was relieved from all financial obligations due to him.
When he returned to the Philippines, he filed an illegal dismissal case.
Labor Arbiter: dismissed the case for lack of merit.
National Labor Relations Commission: Dismissal is illegal. It declared that
while ITM has the prerogative to continue the employment of individuals only
if they were qualified, Dagasdas' dismissal amounted to illegal termination
since the mismatch between his qualifications and the job given him was no
fault of his.
CA: Reversed. It ruled that for having voluntarily accepted money from his
employer, Dagasdas accepted his termination and released his employer
from future financial obligations arising from his past employment with it.
ISSUE: Was Dagasdas validly dismissed from work?
NO. First, Under the Labor Code of the Philippines the following are the just
causes for dismissing an employee:
ARTICLE 297. [282] Termination by Employer. - An employer may terminate
an employment for any of
the following causes:
(a) Serious misconduct or willful disobedience by the employee of the lawful
orders of his employer or
representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his
employer or duly
authorized representative;
(d) Commission of a crime or offense by the employee against the person of
his employer or any
immediate member of his family or his duly authorized representative; and
(e) Other causes analogous to the foregoing.
ITM terminated him because under the contract said Company reserves the
right to terminate their agreement without serving any notice to the
Consultant in the following cases: 17.4.3 If the Consultant is terminated by
company or its client within the probation period of 3 months.
Based on the foregoing, there is no clear justification for the dismissal of
Dagasdas other than the exercise of ITM's right to terminate him within the
probationary period. While our Civil Code recognizes that parties may
stipulate in their contracts such terms and conditions as they may deem
convenient, these terms and conditions must not be contrary to law, morals,
good customs, public order or policy.42
The above-cited clause is contrary to law because as discussed, our
Constitution guarantees that employees, local or overseas, are entitled to
security of tenure. To allow employers to reserve a right to terminate
employees without cause is violative of this guarantee of security of tenure.
Moreover, even assuming that Dagasdas was still a probationary employee
when he was terminated, his dismissal must still be with a valid cause. As
regards a probationary employee, his or her dismissal may be allowed only if
there is just cause or such reason to conclude that the employee fails to
qualify as regular employee pursuant to reasonable standards made known
to the employee at the time of engagement.
Second, the new contract was not shown to have been processed through
the POEA. Under our Labor Code, employers hiring OFWs may only do so
through entities authorized by the Secretary of the Department of Labor and
Employment. Unless the employment contract of an OFW is processed
through the POEA, the same does not bind the concerned OFW because if
the contract is not reviewed by the POEA, certainly the State has no means
of determining the suitability of foreign laws to our overseas workers. This
new contract also breached Dagasdas' original contract as it was entered
into even before the expiration of the original contract approved by the
POEA.
Third, under this new contract, Dagasdas was not afforded procedural due
process when he was dismissed from work. valid dismissal requires
substantive and procedural due process. As regards the latter, the employer
37 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
must give the concerned employee at least two notices before his or her
temination. Specifically, the employer must inform the employee of the cause
or causes for his or her termination, and thereafter, the employer's decision
to dismiss him. Aside from the notice requirement, the employee must be
accorded the opportunity to be heard.
Here, no prior notice of purported infraction, and such opportunity to explain
on any accusation against him was given to Dagasdas. He was simply given
a notice of termination.
27. Sunit v. OSM Maritime Serives, Inc.
G.R. No. 223035
FACTS: OSM Maritime Services, Inc. (OSM Maritime), the local agent of
respondent DOF OSM Maritime Services A/S, hired petitioner Reynaldo
Sunit (Sunit) to work onboard the vessel Skandi Texel as Able Body Seaman
for three (3) months with a monthly salary of $689. Deemed incorporated in
the employment contract is the 2010 Philippine Overseas Employment
Agency Standard Employment Contract (POEA-SEC) and the NIS AMOSUP
CBA.
During his employment, petitioner fell from the vessel's tank approximately
4.5 meters high and suffered a broken right femur. He was immediately
brought to a hospital in the Netherlands for treatment and was eventually
repatriated due to medical reason. Upon his arrival in Manila on October 6,
2012, he immediately underwent a post-employment medical examination
and treatment for his injury at the Metropolitan Medical Center, wherein the
company-designated physician diagnosed him to be suffering from a
"Fractured, Right Femur; S/PIntramedullary Nailing, Right Femur."
After a 92-day treatment, the Doctor gave the petitioner an interim disability
of Grade of 10.
Dissatisfied, he sought the opinion of another doctor who recommended a
disability grade of 3. After further treatment, he was assessed with a final
disability grade of 10 by the company physician of OSM Maritime.
He was offered a disability benefit of $30,225. However, he refused and filed
a claim for a disability benefit of $150,000.00 based on the POEA-SEC and
NIS AMOSUP CBA.
LA: Pursuant to the Grade 9 disability issued by Dr. Bathan, the LA awarded
petitioner disability benefit in the amount of $13,060.
NLRC: Modifying the LA's findings and awarded petitioner permanent and
total disability benefit in the amount of $150,000. The NLRC reasoned that
petitioner is considered as totally and permanently disabled since Dr.
Bathan, the third doctor, issued the Grade 9 disability recommendation after
the lapse of the 240-day period required for the determination of a seafarer's
fitness to
work or degree of disability under the POEA-SEC.
CA: Reinstated LA’s ruling. The 240-day period for assessing the degree of
disability only applies to the company-designated doctor, and not to the third
doctor. It is only upon the company-designated
doctor's failure to render a final assessment of petitioner's condition within
240 days from repatriation that he will be considered permanently and totally
disabled and, hence, entitled to maximum disability benefit. In petitioner's
case, The company-designated doctor was able to make a determination of
his disability within the 240-day period; hence, he is not considered as totally
and permanently disabled despite the opinion of the third doctor having been
rendered after the lapse of 240 days from repatriation.
ISSUE: Whether petitioner is entitled to permanent and total disability
benefits.
RULING: YES. Permanent disability is defined as the inability of a worker to
perform his job for more than 120 days (or 240 days, as the case may be),
regardless of whether or not he loses the use of any part of his body. Total
disability, meanwhile, means the disablement of an employee to earn wages
in the same kind of work of similar nature that he was trained for, or
accustomed to perform, or any kind of work which a person of his mentality
and attainments could do.
Under Article 192(c)(1) of the Labor Code, disability that is both
permanent and total disability is defined as “temporary total disability
lasting continuously for more than one hundred twenty days, except as
otherwise provided in the Rules. Similarly, Rule VII, Section 2(b) of the
Amended Rules on Employees’ Compensation (AREC) provides:(b) A
disability is total and permanent if as a result of the injury or sickness the
employee is unable to perform any gainful occupation for a continuous
period exceeding 120 days, except as otherwise provided for in Rule X of
these Rules. (emphasis supplied)
The adverted Rule X of the AREC, which implements Book IV of the Labor
Code, states in part:
Sec. 2. Period of entitlement. – (a) The income benefit shall be paid
beginning on the first day of such disability. If caused by an injury or
sickness it shall not be paid longer than 120 consecutive days except where
such injury or sickness still requires medical attendance beyond 120
days but not to exceed 240 days from onset of disability in which case
benefit for temporary total disability shall be paid. However, the System may
declare the total and permanent status at anytime after 120 days of
38 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS
continuous temporary total disability as may be warranted by the degree of
actual loss or impairment of physical or mental functions as determined by
the System. (emphasis supplied)
Section 20 (A)(3) of the POEA-SEC, meanwhile, provides that:
SECTION 20. COMPENSATION AND BENEFITS COMPENSATION AND
BENEFITS FOR INJURY OR ILLNESS
The liabilities of the employer when the seafarer suffers work-related injury
or illness during the term of his contract are as follows:
1. In addition to the above obligation of the employer to provide
medical attention, the seafarer shall also receive sickness a11owance from
his employer in an amount equivalent to his basic wage computed from the
time he signed off until he is declared fit to work or the degree of
disability has been assessed by the company-designated physician. x x
x
In determining whether a disability is total or partial, what is crucial is
whether the employee who suffered from disability could still perform
his work notwithstanding the disability he met. A permanent partial
disability presupposes a seafarer’s fitness to resume sea duties before
the end of the 120/240-day medical treatment period despite the
injuries sustained, and works on the premise that such partial injuries
did not disable a seafarer to earn wages in the same kind of work or
similar nature for which he was trained.
The company doctor or the appointed third-party physician must arrive at a
definite and conclusive assessment of the seafarer’s disability or fitness to
return to work before his or her opinion can be valid and binding between the
parties. Dr. Bathan, whose opinion should have bound the parties despite
the lapse of the 120/240 day period, did not make such definite and
conclusive assessment.
It was likewise proved that petitioner’s disability persisted beyond the
240-day period and he was even declared unfit to work by the third
doctor himself. As noted by the NLRC, petitioner failed to have gainful
employment for 499 days reckoned from the time he arrived on October 6,
2012 until Dr. Bathan conducted his assessment due to his injuries.
Moreover, Dr. Bathan’s inconclusive assessment and petitioner’s prolonged
disability only served to underscore that the company-designated doctor
himself failed to render a definitive assessment of petitioner’s disability.
As petitioner was actually unable to work even after the expiration of the
240-day period and there was no final and conclusive disability assessment
made by the third doctor on his medical condition, it would be inconsistent to
declare him as merely permanently and partially disabled. It should be
stressed that a total disability does not require that the employee be
completely disabled, or totally paralyzed. In disability compensation, it is
not the injury which is compensated, but rather it is the incapacity to
work resulting in the impairment of one’s earning capacity.

In view of the foregoing circumstances, petitioner is considered

permanently and totally disabled, and should be awarded the
corresponding disability benefits.

39 AGUINALDO, DIÑO, LAPEZ, MANGUERA, MORALES C., MORALES I. and UMANGAY – LABOR LAW 1 CASE DIGESTS