LABOR LAW 1 ART. 12 – 42 et al.

LABOR CODE ART. 12 - 42 .......................................................................................................................................1

PEOPLE V. PANIS (G.R. NOS. L-58674-77, JULY 11, 1986) ........................................................................................1
PEOPLE V. LAPIS (G.R. NOS. 145734-35, OCTOBER 15, 2002) ...................................................................................2
PEOPLE V. CHUA (G.R. NO. 184058, MARCH 10, 2010) .............................................................................................4
MILLARES V. NATIONAL LABOR RELATIONS COMMISSION (G.R. NO. 110524, MARCH 14, 2000; JULY 29, 2002) ....5
GU-MIRO V. ADORABLE (G.R. NO. 160952. AUGUST 20, 2004) ................................................................................9
RAVAGO V. ESSO EASTERN MARITIME (G.R. NO. 158324. MARCH 14, 2005) ........................................................10
PEOPLE V. MERIS (G.R. NOS. 117145-50 & 117447, MARCH 28, 2000) ...................................................................11
DARVIN V COURT OF APPEALS (G.R. NO. 125044, JULY 13, 1998) ..........................................................................13
ACCESS V. NLRC (G.R. NO. 131656, OCTOBER 12, 1998) ....................................................................................14
EASTERN SHIPPING LINES V. POEA (G.R. NO. 77828 FEBRUARY 8, 1989) ..............................................................16
EASTERN MEDITERRANEAN MARITIME LTD. V. SURIO (G.R. NO. 154213 AUGUST 23, 2012) .................................17
DE JESUS V. NATIONAL LABOR RELATIONS COMMISSION (G.R. NO. 151158, AUGUST 17, 2007) ...........................18
SAMEER OVERSEAS PLACEMENT AGENCY V. CABILES (G.R. NO. 170139, AUGUST 05, 2014) ...............................19
SERRANO VS. GALLANT MARITIME SERVICES, INC. (G.R. NO. 167614, MARCH 24, 2009) .....................................27
CHAVEZ VS. BONTO-PEREZ (G.R. NO. 109808, MARCH 01, 1995) ...........................................................................32
DAGASDAS V. GRAND PLACEMENT (G.R. NO. 205727, JANUARY 18, 2017) ............................................................35
NFD INTERNATIONAL MANNING AGENTS V. NLRC (G.R. NO. 116629, JANUARY 16, 1998) ..................................37

Labor Code Art. 12 - 42

People v. Panis (G.R. Nos. L-58674-77, July
11, 1986)
1. Labor; Recruitment and
placement; Interpretation; Article 13(b) of
P.D. 442, interpreted; Presumption that the
individual or entity is engaged in recruitment
and placement whenever two or more persons
are involved; Number of persons, not an
essential ingredient of the act of recruitment
and placement of workers.- As we see it, the
proviso was intended neither to impose a
condition on the basic rule nor to provide an
exception thereto but merely to create a
presumption. The presumption is that the
individual or entity is engaged in recruitment and
placement whenever he or it is dealing with two
or more persons to whom, in consideration of a
fee, an offer or promise of employment is made
in the course of the “canvassing, enlisting,
contracting, transporting, utilizing, hiring or
procuring (of) workers.” 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) will 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.
2. Labor; Recruitment and
placement; Interpretation; Article 13(b) of
P.D. 442, interpreted; Words “shall be
deemed” in Art. 13(b) of P.D. 442, meaning
of.- In the instant case, the word “shall be
deemed” should by the same token be given the
force of a disputable presumption or of prima
facie evidence of engaging in recruitment and
placement. (Klepp v. Odin Tp., McHenry
County 40 ND N.W. 313, 314.)
FACTS: On January 9, 1981, four information
were filed in the in the Court of First Instance
(CFI) of Zambales and Olongapo City alleging
that herein 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, did
then and there wilfully, unlawfully and
criminally operate a private fee charging
employment agency by charging fees and
expenses (from) and promising employment in

RMC School of Law Laong Laan 1

LABOR LAW 1
Saudi Arabia" to four separate individuals. Abug
filed a motion to quash contending that he
cannot be charged for illegal recruitment
because according to him, Article 13(b) of the
Labor Code says there would be illegal
recruitment only "whenever two or more persons
are in any manner promised or offered any
employment for a fee.” Denied at first, the
motion to quash was reconsidered and granted
by the Trial Court in its Orders dated June 24,
1981, and September 17, 1981. In the instant
case, the view of the private respondents is that
to constitute recruitment and placement, all the
acts mentioned in this article should involve
dealings with two or more persons as an
indispensable requirement. On the other hand,
the petitioner argues that 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.
ISSUE: Whether or not Article 13(b) of the
Labor Code provides for the innocence or guilt
of the private respondent of the crime of illegal
recruitment
HELD: The Supreme Court reversed the CFI’s
Orders and reinstated all four information filed
against private respondent. The Article 13(b) of
the Labor Code was merely intended to create a
presumption, and not to impose a condition on
the basic rule nor to provide an exception
thereto. 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 the said
presumption.
Dispositive Portion: WHEREFORE, the Orders of
June 24, 1981, and September 17, 1981, are set aside
and the four informations against the private
respondent reinstated. No costs.
People v. Lapis (G.R. Nos. 145734-35,
October 15, 2002)
1. Criminal Law; Labor Law; Illegal
Recruitment; Elements.—Illegal
RMC School of Law
ART. 12 – 42 et al.
recruitment is committed when these two
elements concur: (1) the offenders have no
valid license or authority required by law to
enable them to lawfully engage in the
recruitment and placement of workers, and
(2) the offenders undertake any activity
within the meaning of recruitment and
placementdefined in Article 13(b) or any
prohibited practices enumerated in Article
34 of the Labor Code.
2. Same; Same; Same; Words and
Phrases; In the simplest terms, illegal
recruitment is committed by persons who,
without authority from the government,
give the impression that they have the
power to send workers abroad for
employment purposes.—Under Article
13(b), recruitment and placement refers to
“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.” In the simplest terms,
illegal recruitment is committed by persons
who, without authority from the
government, give the impression that they
have the power to send workers abroad for
employment purposes.
3. Same; Same; Same; Illegal recruiters
need not even expressly represent
themselves to the victims as persons who
have the ability to send workers abroad—
it is enough that they give the impression
that they have the ability to enlist workers
for job placement abroad in order to
induce the latter to tender payment of
fees.—Where appellants made
misrepresentations concerning their
purported power and authority to recruit for
overseas employment, and in the process,
collected from complainants various
amounts in the guise of placement fees, the
former clearly committed acts constitutive
of illegal recruitment. In fact, this Court held
that illegal recruiters need not even
expressly represent themselves to the
victims as persons who have the ability to
send workers abroad. It is enough that these
recruiters give the impression that they have
the ability to enlist workers for job
placement abroad in order to induce the
latter to tender payment of fees.
4. Same; Same; Same; Statutes; Migrant
Workers and Overseas Filipinos Act of
1995 (RA 8042); Under RA 8042, illegal
Laong Laan 2
LABOR LAW 1
recruitment shall be considered an
offense involving economic sabotage when
it is committed by a syndicate or carried
out by a group of three or more persons
conspiring and confederating with one
another.—Section 6 of RA 8042, otherwise
known as the Migrant Workers and
Overseas Filipinos Act of 1995, provides
that illegal recruitment shall be considered
an offense involving economic sabotage
when it is committed by a syndicate or
carried out by a group of three or more
persons conspiring and confederating with
one another. In several cases, illegal
recruitment has been deemed committed by
a syndicate if carried out by a group of three
or more persons conspiring and/or
confederating with each other in carrying
out any unlawful or illegal transaction,
enterprise or scheme defined under Article
38(b) of the Labor Code.
5. Same; Same; Same; Conspiracy; To
establish conspiracy, it is not essential
that there be actual proof that all the
conspirators took a direct part in every
act—it is sufficient that they acted in
concert pursuant to the same objective.—
In People v. Gamboa, the Court had
occasion to discuss the nature of conspiracy
in the context of illegal recruitment as
follows: “Conspiracy to defraud aspiring
overseas Contract workers was evident from
the acts of the malefactors whose conduct
before, during and after the commission of
the crime clearly indicated that they were
one in purpose and united in
execution. Direct proof of previous
agreement to commit a crime is not
necessary as it may be deduced from the
mode and manner in which the offense was
perpetrated or inferred from the acts of the
accused pointing to a joint purpose and
design, concerted action and community of
interest. All the accused, including accused-
appellant, are equally guilty of the crime of
illegal recruitment since in a conspiracy the
act of one is the act of all.” (Emphasis
supplied) To establish conspiracy, it is not
essential that there be actual proof that all
the conspirators took a direct part in every
act. It is sufficient that they acted in concert
pursuant to the same objective. Conspiracy
is present when one concurs with the
criminal design of another, indicated by the
performance of an overt act leading to the
crime committed.
RMC School of Law Laong Laan
ART. 12 – 42 et al.
6. Same; Same; Same; Interests; Victims of
illegal recruitment are entitled to legal
interest on the amount to be recovered as
indemnity, from the time of the filing of the
information until fully paid.—The OSG
avers, as an incident to this issue, and in line
with People y. Yabut, that complainants are
entitled to recover interest on the amount of
P118,000, which the trial court awarded from
the time of the filing of the Information until
fully paid. We agree with the OSG’s
observation and hereby grant the legal
interest on the amount prayed for. In a
number of cases, this Courthas affirmed the
trial court’s finding that victims of illegal
recruitment are entitled to legal interest on
the amount to be recovered as indemnity,
from the time of the filing of the information
until fully paid.
7. Same; Estafa; Words and Phrases; Estafa
under Article 315, par. 2(a) of the Revised
Penal Code, is committed by any person
who defrauds another by using a fictitious
name, or by falsely pretending to possess
power, influence, qualifications, property,
credit, agency, business, or by imaginary
transactions or similar forms of deceit
executed prior to or simultaneous with the
fraud.—Under the cited provision of the
Revised Penal Code, estafa is committed by
any person who defrauds another by using a
fictitious name; or by falsely pretending to
possess power, influence, qualifications,
property, credit, agency, business; by
imaginary transactions or similar forms of
deceit executed prior to or simultaneous with
the fraud. Moreover, these false pretenses
should have been the very reason that
motivated complainants to deliver property
or pay money to the perpetrators of the fraud.
While appellants insist that these constitutive
elements of the crime were not sufficiently
shown by the prosecution, the records of the
case prove otherwise.
8. Same; Indeterminate Sentence
Law; Under Sec. 1 of the Indeterminate
Sentence Law, the maximum term of the
indeterminate sentence shall be the
penalty properly imposed, considering the
attending circumstances, while the
minimum term shall be within the range of
the penalty next lower than that
prescribed by the Revised Penal Code.—
Although we agree with the ruling of the RTC
convicting appellants of estafa, we note that
it failed to apply the Indeterminate Sentence
3
LABOR LAW 1
Law in imposing the penalty. Under Section
1 of that law, the maximum term of the
indeterminate sentence shall be the penalty
properly imposed, considering the attending
circumstances; while the minimum term shall
be within the range of the penalty next lower
than that prescribed by the Code. Hence,
pursuant to the Indeterminate Sentence Law,
the trial court should have fixed the minimum
and the maximum penalties.
Dispositive Portion: WHEREFORE, the appealed
Decision is hereby AFFIRMED with the following
MODIFICATIONS:
1. In Criminal Case No. 99-1112, appellants
are ordered to pay legal interest on the
amount of P118,000 from the time of the
filing of the Information until fully paid.
2. In Criminal Case No. 99-1113, appellants
are sentenced to an indeterminate penalty of
twelve (12) years of prision mayor as
minimum to twenty (20) years of reclusion
temporal as maximum.
People v. Chua (G.R. No. 184058, March 10,
2010)
1. Criminal Law; Labor Law; Estafa; Illegal
Recruitment; Recruitment and Placement
Defined.-—The term “recruitment and
placement” is defined under Article 13(b) of
the Labor Code of the Philippines as
follows: (b) “Recruitment and placement”
refers to 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.
2. Same; Same; Same; Same; Same; Intent
is immaterial in illegal recruitment in
large scale.-—Assuming arguendo that
appellant was unaware of the illegal nature
of the recruitment business of Golden Gate,
that does not free her of liability either.
Illegal Recruitment in Large Scale penalized
under Republic Act No. 8042, or “The
Migrant Workers and Overseas Filipinos
Act of 1995,” is a special law, a violation of
which is malum prohibitum, not malum in
se. Intent is thus immaterial.
RMC School of Law
ART. 12 – 42 et al.
3. Same; Same; Same; Same; Same;
Essential Elements for Illegal
Recruitment in Large Scale to Prosper.-
—Thus for illegal recruitment in large scale
to prosper, the prosecution has to prove
three essential elements, to wit: (1) the
accused undertook a recruitment activity
under Article 13(b) or any prohibited
practice under Article 34 of the Labor Code;
(2) the accused did not have the license or
the authority to lawfully engage in the
recruitment and placement of workers; and
(3) the accused committed such illegal
activity against three or more persons
individually or as a group.
4. Same; Same; Same; Same; Illegal
Recruitment in Large Scale; Any
recruitment activities to be undertaken by
non-licensee or non-holder of contracts,
or as in the present case, an agency with
an expired license, shall be deemed illegal
and punishable under Article 39 of the
Labor Code of the Philippines; Illegal
recruitment is deemed committed in large
scale if committed against three or more
persons individually or as a group.-—
From the foregoing provisions, it is clear
that any recruitment activities to be
undertaken by non-licensee ornon-holder of
contracts, or as in the present case, an
agency with an expired license, shall be
deemed illegal and punishable under Article
39 of the Labor Code of the Philippines.
And illegal recruitment is deemed
committed in large scale if committed
against three or more persons individually or
as a group.
FACTS: Private complainants Alberto A.
Aglanao, Rey P. Tajadao, Billy R. Danan and
Roylan Ursulum filed a complaint for illegal
dismissal in large scale against Melissa Chua
alleging that the latter offered them a job as
factory workers in Taiwan for deployment
within a month. She required each of them on
separate occasions to undergo medical
examination and pay a placement fee
of P 80,000 each. Chua assured each of them
that whoever pays the application fee the earliest
can leave sooner. After completing payment,
they followed-up their applications. However,
they learned that Chua was not licensed to
recruit workers for overseas employment. Chua
denied having recruited private complainants for
Laong Laan 4
LABOR LAW 1
overseas employment and interposed the defense
that she was only a cashier at Golden Gate
Office and that she has no knowledge of whether
the agency was licensed to recruit workers
during her tenure as it has been delisted.The
RTC of Manila found Chua guilty of illegal
recruitment in large scale, which was affirmed
by the CA.
ISSUE: Is Melissa Chua liable for illegal
recruitment in large scale? LAW: Sections 6 and
7 of Republic Act R.A. No. 8042.
HELD: Yes. Melissa Chua is liable for illegal
recruitment in large scale.
In order to hold a person liable for
illegal recruitment, the following elements must
concur:
(1) the offender undertakes any of the
activities within the meaning of "recruitment and
placement" under Article 13(b) of the Labor
Code, or any of the prohibited practices
enumerated under Article 34 of the Labor Code
(now Section 6 of Republic Act No. 8042); and
(2) the offender has no valid license or
authority required by law to enable him to
lawfully engage in recruitment and placement of
workers.
In the case of illegal recruitment in large
scale, a third element is added: that the offender
commits any of the acts of recruitment and
placement against three or more persons,
individually or as a group.
All three elements are present in the case
at bar. Chua engaged in recruitment when she
represented to private complainants that she
could send them to Taiwan as factory workers
upon submission of the required documents and
payment of the placement fee. The four private
complainants positively identified appellant as
the person who promised them employment as
factory workers in Taiwan. Chua cannot escape
liability by conveniently limiting her
participation as a cashier of Golden Gate. The
provisions of Article 13(b) of the Labor Code
and Section 6 of R.A. No. 8042 are unequivocal
that illegal recruitment may or may not be for
profit. It is immaterial, therefore, whether Chua
remitted the placement fees to "the agency’s
treasurer" or appropriated them. The same
provision likewise provides that the persons
criminally liable for illegal recruitment are the
RMC School of Law
ART. 12 – 42 et al.
principals, accomplices and accessories. Just the
same, therefore, appellant can be held liable as a
principal by direct participation since she
personally undertook the recruitment of private
complainants without a license or authority to do
so.
Dispositive Portion: WHEREFORE, the appeal is
hereby DENIED.
Millares v. National Labor Relations
Commission (G.R. No. 110524, March 14,
2000; July 29, 2002)
1. Labor Law; Classification of
Employment; Primary Standard to
Determine a Regular Employment.- The
primary standard to determine a regular
employment is the reasonable connection
between the particular activity performed by
the employee in relation to the usual
business or trade of the employer. The test is
whether the former is usually necessary or
desirable in the usual business or trade of the
employer.
2. Labor Law; Classification of
Employment; The connection can be
determined by considering the nature of
the work performed and its relation to the
scheme of the particular business or trade
in its entirety.-The connection can be
determined by considering the nature of the
work performed and its relation to the
scheme of the particular business or trade in
its entirety. Also, if the employee has been
performing the job for at least one year,
even if the performance is not continuous or
merely intermittent, the law deems the
repeated and continuing need for its
performance as sufficient evidence of the
necessity if not indispensability of that
activity to the business. Hence, the
employment is also considered regular, but
only with respect to such activity and while
such activity exists.
3. Labor Law; Classification of
Employment; Petitioners are considered
regular employees.-As petitioners had
rendered 20 years of service, performing
activities which were necessary and
desirable in the business or trade of private
respondents, they are, by express provision
of Article 280 of the Labor Code, considered
regular employees.
Laong Laan 5
LABOR LAW 1
4. Labor Law; Classification of
Employment; Being regular employees,
petitioners may not be dismissed except
for a valid or just cause under Article 282
of the Labor Code.-Being regular
employees, petitioners may not be dismissed
except for a valid or just cause under Article
282 of the Labor Code. In the instant case,
clearly, there was no valid cause for the
termination of petitioners. It will be recalled,
that petitioner Millares was dismissed for
allegedly having “abandoned” his post; and
petitioner Lagda, for his alleged
“unavailability for contractual sea service.”
However, that petitioners did not abandon
their jobs such as to justify the unlawful
termination of their employment is borne out
by the records.
5. Labor Law; Dismissals; Abandonment;
Two Elements to Constitute
Abandonment; It is the employer who has
the burden of proof to show a deliberate
and unjustified refusal of the employee to
resume his employment without any
intention of returning.-To constitute
abandonment, two elements must concur:
(1) the failure to report for work or absence
without valid or justifiable reason; and (2) a
clear intention to sever the employer-
employee relationship, with the second
element as the more determinative factor
and being manifested by some overt acts.
Mere absence is not sufficient. It is the
employer who has the burden of proof to
show a deliberate and unjustified refusal of
the employee to resume his employment
without any intention of returning.
6. Labor Law; Dismissals; Abandonment;
Two Elements to Constitute
Abandonment; The filing by an employee
of a complaint for illegal dismissal is
proof enough of his desire to return to
work, thus negating the employer’s
charge of abandonment.-In this case,
private respondents failed to discharge this
burden. They did not adduce any proof of
some overt act of the petitioners that clearly
and unequivocally show their intention to
abandon their posts. On the contrary, the
petitioners lost no time in filing the case for
illegal dismissal against private respondents,
taking them only about a month from the
time their termination became effective on
September 1, 1989 to the filing of their
complaint on October 5, 1989. They cannot,
by any reasoning, be said to have abandoned
RMC School of Law Laong Laan
ART. 12 – 42 et al.
their work, for as we have also previously
ruled, the filing by an employee of a
complaint for illegal dismissal is proof
enough of his desire to return to work, thus
negating the employer’s charge of
abandonment.
7. Labor Law; Classification of
Employment; Seafarers are considered
contractual employees; They can not be
considered as regular employees under
Article 280 of the Labor Code.-From the
foregoing cases, it is clear that seafarers are
considered contractual employees. They can
not be considered as regular employees
under Article 280 of 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. 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.
8. Labor Law; Classification of
Employment; Seafarers are considered
contractual employees; There are certain
forms of employment which also require
the performance of usual and desirable
functions and which exceed one year but
do not necessarily attain regular
employment status under Article 280.-
Petitioners insist that they should be
considered regular employees, since they
have rendered services which are usually
necessary and desirable to the business of
their employer, and that they have rendered
more than twenty (20) years of service.
While this may be true, the Brent case has,
however, held that there are certain forms of
employment which also require the
performance of usual and desirable
functions and which exceed one year but do
not necessarily attain regular employment
status under Article 280. Overseas workers
including seafarers fall under this type of
6
LABOR LAW 1
employment which are governed by the
mutual agreements of the parties.
9. Labor Law; Classification of
Employment; Seafarers are considered
contractual employees; Filipino seamen
are governed by the Rules and
Regulations of the POEA; Contract of
seamen shall be for a fixed period, not
longer than 12 months.- In this jurisdiction
and as clearly stated in the Coyoca case,
Filipino seamen are governed by the Rules
and Regulations of the POEA. The Standard
Employment Contract governing the
Employment of All Filipino Seamen on
Board Ocean-Going Vessels of the POEA,
particularly in Part I, Sec. C specifically
provides that the contract of seamen shall be
for a fixed period. And in no case should the
contract of seamen be longer than 12
months.
FACTS: Douglas Millares was employed by
ESSO International Shipping Company through
its local manning agency,Trans-Global Maritime
Agency, as a machinist he was promoted as
Chief Engineer which position Millares applied
for a leave of absence for almost 1mon.the
Trans-Global, approved the request for leave of
absence. Millares wrote to the Operations
Manager of Exxon International Co.informing
him of his intention to avail of the optional
retirement plan under the Consecutive
Enlistment Incentive Plan (CEIP) considering
that he had already rendered more than twenty
(20) years of continuous service. Esso
International, denied the request for optional
retirement on the following grounds, to wit: (1)
he was employed on a contractual basis; (2) his
contract of enlistment (COE) did not provide for
retirement before the age of sixty (60) years; and
(3) he did not comply with the requirement for
claiming benefits under the CEIP, i.e., to submit
a written advice to the company of his intention
to terminate his employment within thirty (30)
days from his last disembarkation date Millares
requested for an extension of his leave of
absence for another 15 days. The Crewing
Manager, Ship Group A, Trans-Global, wrote
petitioner Millares advising him that respondent
Esso International "has corrected the deficiency
in its manpower requirements specifically in the
Chief Engineer rank by promoting a First
Assistant Engineer to this position as a result of
RMC School of Law
ART. 12 – 42 et al.
(his) previous leave of absence which expired
last August 8, 1989. The adjustment in said rank
was required in order to meet manpower
schedules as a result of (his) inability.Esso
International advised Millares that his absence
without leave, which is equivalent to
abandonment of his position,
On the other hand Lagda was employed
by Esso International as wiper/oiler He was
promoted as Chief Engineer in 1980, a position
he continued to occupy until his last COE
expired on April 10, 1989.Lagda applied for a
leave of absence from June 19,1989 up to the
whole month of August 1989. Then the Trans-
Global’s approved petitioner Lagda’s leave of
absence from June 22, 1989 to July 20, 1989[7]
and advised him to report for re-assignment on
July 21, 1989. Lagda wrote a letter to Operations
Manager of Esso International, through Trans-
Global’s President informing him of his
intention to avail of the optional early retirement
plan in view of his twenty (20) years continuous
service in the company Trans-Global denied
petitioner Lagda’s request for availment of the
optional early retirement scheme on the same
grounds upon which petitioner Millares’ request
was denied.he requested for an extension of his
leave of absence up to August 26, 1989 and the
same was approved. However Esso International
through Personnel Administrator, advised
petitioner Lagda that in view of his
"unavailability for contractual sea service," he
had been dropped from the roster of crew
members effective September 1, 1989.
Millares and Lagda filed a complaint-affidavit,
for illegal dismissal and non-payment of
employee benefits against private respondents
Esso International and Trans-Global, before the
POEA. POEA: dismissing the complaint for lack
of merit. NLRC dismissing petitioners’ appeal
and denying their motion for new trial for lack
of merit.
ISSUE: WHETHER OR NOT THEY ARE
REGULAR EMPLOYEES.
HELD: SC: Art. 280. Regular and casual
employment. - The provisions of written
agreement to the contrary notwithstanding and
regardless of the oral agreement of the parties,
an employment shall be deemed to be regular
Laong Laan 7
LABOR LAW 1
where the employee has been engaged to
perform activities which are usually necessary or
desirable in the usual business or trade of the
employer, except where the employment has
been fixed for a specific project or undertaking
the completion or termination of which has been
determined at the time of the 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.
An employment shall be deemed to be
casual if it is not covered by the preceding
paragraph. Provided, That, any employee who
has rendered at least one year of service,
whether such service is continuous or broken,
shall be considered a regular employee with
respect to the activity in which he is employed
and his employment shall continue while such
activity exists. The primary standard to
determine a regular employment is the
reasonable connection between the particular
activity performed by the employee in relation to
the usual business or trade of the employer. The
test is whether the former is usually necessary or
desirable in the usual business or trade of the
employer
The connection can be determined by
considering the nature of the work performed
and its relation to the scheme of the particular
business or trade in its entirety. Also, if the
employee has been performing the job for at
least one year, even if the performance is not
continuous or merely intermittent, the law deems
the repeated and continuing need for its
performance as sufficient evidence of the
necessity if not indispensability of that activity
to the business. Hence, the employment is also
considered regular, but only with respect to such
activity and while such activity exists.[
That it is undisputed that petitioners
were employees of private respondents until
their services were terminated on September 1,
1989. They served in their capacity as Chief
Engineers, performing activities which were
necessary and desirable in the business of
private respondents Esso International, a
shipping company; and Trans-Global, its local
manning agency which supplies the manpower
and crew requirements of Esso International’s
vessels.It is, likewise, clear that petitioners had
been in the employ of private respondents for 20
RMC School of Law Laong Laan
ART. 12 – 42 et al.
years. The records reveal that petitioners were
repeatedly re-hired by private respondents even
after the expiration of their respective eight-
month contracts. Such repeated re-hiring which
continued for 20 years, cannot but be
appreciated as sufficient evidence of the
necessity and indispensability of petitioners’
service to the private respondents’ business or
trade. Verily, as petitioners are by express
provision of Article 280 of the Labor Code,
considered regular employees.
That there was no valid cause for the
termination of petitioners. It will be recalled,
that petitioner Millares was dismissed for
allegedly having "abandoned" his post; and
petitioner Lagda, for his alleged "unavailability
for contractual sea service." However, that
petitioners did not abandon their jobs such as to
justify the unlawful termination of their
employment is borne out by the records.To
constitute abandonment, two elements must
concur: (1) the failure to report for work or
absence without valid or justifiable reason; and
(2) a clear intention to sever the employer-
employee relationship.Furthermore, the absence
of petitioners was justified by the fact that they
secured the approval of respondents to take a
leave of absence after the termination of their
last contracts of enlistment. Clearly, petitioners’
termination is illegal.
Dispositive Portion (2000): WHEREFORE, premises
considered, the assailed Decision, dated June 1,
1993, of the National Labor Relations Commission is
hereby REVERSED and SET ASIDE and a new
judgment is hereby rendered ordering the private
respondents to:
1. Reinstate petitioners Millares and Lagda to
their former positions without loss of
seniority rights, and to pay full backwages
computed from the time of illegal dismissal
to the time of actual reinstatement;
2. Alternatively, if reinstatement is not
possible, pay petitioners Millares and Lagda
separation pay equivalent to one month’s
salary for every year of service; and,
3. Jointly and severally pay petitioners One
Hundred Percent (100%) of their total
credited contributions as provided under the
Consecutive Enlistment Incentive Plan.
Dispositive Portion (2002): IN VIEW OF THE
FOREGOING, the Court Resolved to Partially
8
LABOR LAW 1
GRANT Private Respondent’s Second Motion for
Reconsideration and Intervenor FAMES’ Motion for
Reconsideration in Intervention. The Decision of the
National Labor Relations Commission dated June 1,
1993 is hereby REINSTATED with MODIFICATION.
The Private Respondents, Trans-Global Maritime
Agency, Inc. and Esso International Shipping Co.,
Ltd. are hereby jointly and severally ORDERED to
pay petitioners One Hundred Percent (100%) of their
total credited contributions as provided under the
Consecutive Enlistment Incentive Plan (CEIP).
Gu-Miro v. Adorable (G.R. No.
160952. August 20, 2004)
1. Criminal Law; Labor Law; Estafa; Illegal
Recruitment; Recruitment and Placement
Defined.—The term “recruitment and
placement” is defined under Article 13(b) of
the Labor Code of the Philippines as
follows: (b) “Recruitment and placement”
refers to 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.
2. Same; Same; Same; Same; Illegal
Recruitment in Large Scale; Any
recruitment activities to be undertaken by
non-licensee or non-holder of contracts,
or as in the present case, an agency with
an expired license, shall be deemed illegal
and punishable under Article 39 of the
Labor Code of the Philippines; Illegal
recruitment is deemed committed in large
scale if committed against three or more
persons individually or as a group.—From
the foregoing provisions, it is clear that any
recruitment activities to be undertaken by
non-licensee or non-holder of contracts, or
as in the present case, an agency with an
expired license, shall be deemed illegal and
punishable under Article 39 of the Labor
Code of the Philippines. And illegal
recruitment is deemed committed in large
scale if committed against three or more
persons individually or as a group.
3. Same; Same; Same; Same; Same;
Essential Elements for Illegal
Recruitment in Large Scale to Prosper.—
RMC School of Law
ART. 12 – 42 et al.
Thus for illegal recruitment in large scale to
prosper, the prosecution has to prove three
essential elements, to wit: (1) the accused
undertook a recruitment activity under
Article 13(b) or any prohibited practice
under Article 34 of the Labor Code; (2) the
accused did not have the license or the
authority to lawfully engage in the
recruitment and placement of workers; and
(3) the accused committed such illegal
activity against three or more persons
individually or as a group.
4. Same; Same; Same; Same; Same; Intent
is immaterial in illegal recruitment in
large scale.—Assuming arguendo that
appellant was unaware of the illegal nature
of the recruitment business of Golden Gate,
that does not free her of liability either.
Illegal Recruitment in Large Scale penalized
under Republic Act No. 8042, or “The
Migrant Workers and Overseas Filipinos
Act of 1995,” is a special law, a violation of
which is malum prohibitum, not malum in
se. Intent is thus immaterial.
FACTS: Petitioner services as radio officer on
board respondent’s different vessels were
terminated due to the installation of labor saving
devices which made his services redundant.
Petitioner argued that aside from the incentive
bonus and additional allowances that he is
entitled, he should be considered as a regular
employee of respondent company, having been
employed onboard the latter’s different vessels
for the span of 10 years and thus, entitled to
back wages and separation pay.
ISSUE: Whether or not seafarers are considered
regular employees.
HELD: No. Petitioner cannot be considered as a
regular employee notwithstanding that the work
he performs is necessary and desirable in the
business of the respondent company. The
exigencies of the work of seafarers necessitates
that they be employed on a contractual basis.
Thus, even with the continued re-hiring by
respondent company of petitioner to serve as
radio officer onboard the former’s different
vessels, this should be interpreted not as a basis
for regularization but rather a series of contract
renewals.
Laong Laan 9
LABOR LAW 1
Dispositive Portion: WHEREFORE, premises
considered, the petition is GRANTED IN PART. The
Decision of the Court of Appeals in CA-G.R. SP No.
66131 dated May 29, 2003 is MODIFIED in that the
award of incentive bonus is increased from
US$1189.12 to US$1,486.40. Petitioners claim that
he be declared a regular employee and awarded
backwages and separation pay is DENIED for lack of
merit.
Ravago v. ESSO Eastern Maritime (G.R. No.
158324. March 14, 2005)
1. Labor Law; Injunctions; Article 254 of
the Labor Code proscribes the issuance of
injunctive relief only in those cases
involving or growing out of a labor
dispute; Article 254 of the Labor Code
specifically provides that the NLRC may
grant injunctive relief under Article 218
thereof.-The petitioner’s reliance on Article
254 of the Labor Code is misplaced. The
law proscribes the issuance of injunctive
relief only in those cases involving or
growing out of a labor dispute. The case
before the NLRC neither involves nor grows
out of a labor dispute. It did not involve the
fixing of terms or conditions of employment
or representation of persons with respect
thereto. In fact, the petitioner’s complaint
revolves around the issue of his alleged
dismissal from service and his claim for
backwages, damages and attorney’s fees.
Moreover, Article 254 of the Labor Code
specifically provides that the NLRC may
grant injunctive relief under Article 218
thereof.
2. Labor Law; Injunctions; The application
of an injunctive writ rests upon the
presence of an exigency or of an
exceptional reason before the main case
can be regularly heard; Indispensable
Conditions for Granting Temporary
Injunctive Relief.- Generally, an injunction
is a preservative remedy for the protection
of a person’s substantive rights or interests.
It is not a cause of action in itself but a mere
provisional remedy, an appendage to the
main suit. Pressing necessity requires that it
should be resorted to only to avoid injurious
consequences which cannot be remedied
under any measure of consideration. The
application of an injunctive writ rests upon
the presence of an exigency or of an
exceptional reason before the main case can
RMC School of Law
ART. 12 – 42 et al.
be regularly heard. The indispensable
conditions for granting such temporary
injunctive relief are: (a) that the complaint
alleges facts which appear to be satisfactory
to establish a proper basis for injunction, and
(b) that on the entire showing from the
contending parties, the injunction is
reasonably necessary to protect the legal
rights of the plaintiff pending the litigation.
3. Labor Law; Nature of Employment;
Seamen and overseas contract workers
are not covered by the term “regular
employment” as defined in Article 280 of
the Labor Code.- In a catena of cases, this
Court has consistently ruled that seafarers
are contractual, not regular, employees. In
Brent School, Inc. v. Zamora, the Court
ruled that seamen and overseas contract
workers are not covered by the term “regular
employment” as defined in Article 280 of
the Labor Code.
4. Labor Law; Nature of Employment; A
seafarer, not being a regular employee, is
not entitled to separation or termination
pay.-The Court made the same ruling in
Coyoca v. National Labor Relations
Commission and declared that a seafarer,
not being a regular employee, is not entitled
to separation or termination pay.
FACTS: The respondent Esso is a foreign
company based in Singapore and engaged in
maritime commerce. It is represented in the
Philippines by its manning agent and co-
respondent Trans-Global, a corporation
organized under the Philippine laws. Roberto
Ravago was hired by Trans-Global to work as a
seaman on board various Esso vessels. On
February 13, 1970, Ravago commenced his duty
as S/N wiper on board the Esso Bataan under a
contract that lasted until February 10, 1971.
Thereafter, he was assigned to work in different
Esso vessels where he was designated diverse
tasks, such as oiler, then assistant engineer. He
was employed under a total of 34 separate and
unconnected contracts, each for a fixed period,
by three different companies, namely, Esso
Tankers, Inc. (ETI), EEM and Esso International
Shipping (Bahamas) Co., Ltd. (EIS), Singapore
Branch. Ravago worked with Esso vessels until
August 22, 1992, a period spanning more than
22 years.
Laong Laan 10
LABOR LAW 1
Shortly after completing his latest
contract with Esso, Ravago was granted a
vacation leave with pay. Preparatory to his
embarkation under a new contract, he was
ordered to report for a Medical Pre-Employment
Examination, which, according to the records, he
passed. He, likewise, attended a Pre-Departure
Orientation Seminar conducted by the Capt. I.P.
Estaniel Training Center, a division of Trans-
Global.
One night, a stray bullet hit Ravago on
the left leg while he was waiting for a bus ride in
Cubao, Quezon City. He fractured his left
proximal tibia and was hospitalized at the
Philippine Orthopedic Hospital. Ravago’s wife,
Lolita, informed the petitioners of the incident
for purposes of availing medical benefits. As a
result of his injury, Ravago’s doctor opined that
he would not be able to cope with the job of a
seaman and suggested that he be given a desk
job. For this reason, the company physician
found him to have lost his dexterity, making him
unfit to work once again as a seaman.
Consequently, instead of rehiring Ravago, Esso
paid him his Career Employment Incentive Plan
(CEIP) as of and his final tax refund. However,
Ravago filed a complaint for illegal dismissal
with prayer for reinstatement, backwages,
damages and attorney’s fees against Trans-
Global and Esso with the POEA Adjudication
Office.
Respondents denied that Ravago was
dismissed without notice and just cause. Rather,
his services were no longer engaged in view of
the disability he suffered which rendered him
unfit to work as a seafarer. This fact was further
validated by the company doctor and Ravago’s
attending physician. They averred that Ravago
was a contractual employee and was hired under
34 separate contracts by different companies.
Ravago insisted that he was fit to
resume pre-injury activities and that he was not
a mere contractual employee because the
respondents regularly and continuously rehired
him for 23 years and, for his continuous service,
was awarded a CEIP payment upon his
termination from employment.
ISSUE: Whether or not petitioner Ravago is a
regular employee of respondent Esso.
RMC School of Law Laong Laan
ART. 12 – 42 et al.
HELD: The SC held that seafarers are
contractual, not regular, employees. Seamen and
overseas contract workers are not covered by the
term “regular employment” as defined in Article
280 of the Labor Code.
Dispositive Portion: IN LIGHT OF ALL THE
FOREGOING, the petition is hereby DENIED.
The assailed Decision dated August 28, 2002 of
the Court of Appeals is hereby AFFIRMED. No
pronouncement as to costs.
Dispositive Portion: IN LIGHT OF ALL THE
FOREGOING, the petition is hereby DENIED. The
assailed Decision dated August 28, 2002 of the Court
of Appeals is hereby AFFIRMED. No pronouncement
as to costs.
People v. Meris (G.R. Nos. 117145-50 &
117447, March 28, 2000)
1. Criminal Law; Illegal Recruitment in
Large Scale; Illegal recruitment is
conducted in a large scale if perpetrated
against three (3) or more persons
individually or as a group.-Illegal
recruitment is conducted in a large scale if
perpetrated against three (3) or more persons
individually or as a group. This crime
requires proof that the accused: (1) engaged
in the recruitment and placement of workers
defined under Article 13 or in any of the
prohibited activities under Article 34 of the
Labor Code; (2) does not have a license or
authority to lawfully engage in the
recruitment and placement of workers; and
(3) committed the infraction against three or
more persons, individually or as a group.
2. Criminal Law; Illegal Recruitment in
Large Scale; Estafa; Estafa under Article
315, paragraph 2 of the Revised Penal
Code is committed by any person who
defrauds another by using a fictitious
name, or falsely pretends to possess
power, influence, qualifications, property,
credit, agency, business or imaginary
transactions, or by means of similar
deceits executed prior to or
simultaneously with the commission of
the fraud.-We find that accused-appellant
committed the crime of estafa under Article
315, paragraph 2 of the Revised Penal Code.
This is committed by any person who
defrauds another by using a fictitious name,
or falsely pretends to possess power,
11
LABOR LAW 1
influence, qualifications, property, credit,
agency, business or imaginary transactions,
or by means of similar deceits executed
prior to or simultaneously with the
commission of the fraud. The offended party
must have relied on the false pretense,
fraudulent act or fraudulent means of the
accused-appellant and as a result thereof, the
offended party suffered damages.
3. Criminal Law; Illegal Recruitment in
Large Scale; Estafa; Indeterminate
Sentence Law; Under the Indeterminate
Sentence Law, the maximum term of the
penalty shall be “that which, in view of
the attending circumstances, could be
properly imposed” under the Revised
Penal Code, and the minimum shall be
“within the range of the penalty next
lower to that prescribed” for the offense.-
Under the Indeterminate Sentence Law, the
maximum term of the penalty shall be “that
which, in view of the attending
circumstances, could be properly imposed”
under the Revised Penal Code, and the
minimum shall be “within the range of the
penalty next lower to that prescribed” for the
offense. The penalty next lower should be
based on the penalty prescribed by the Code
for the offense, without first considering any
modifying circumstance attendant to the
commission of the crime. The determination
of the minimum penalty is left by law to the
sound discretion of the court and it can be
anywhere within the range of the penalty
next lower without any reference to the
periods into which it might be subdivided.
The modifying circumstances are considered
only in the imposition of the maximum term
of the indeterminate sentence.
FACTS: Leonida Meris was convicted of six (6)
counts of estafa and one count of illegal
recruitment for defrauding the six (6)
complainants, Meris’ townmates in Pampanga
and relatives in large scale in the amount of
P30,000.00 each for five complainants and one
complainant for P20,000.00 for alleged overseas
employment which did not materialize.
Meris, who voluntarily appeared in
court, pleaded not guilty to the charges and
actively participated in her defense. She
interposed the defense of denial claiming that
she merely introduced complainants to Julie
Micua, her recruiter in Manila, with whom
RMC School of Law Laong Laan
ART. 12 – 42 et al.
complainants transacted with for their
employment abroad upon payment of placement
fees denied having represented herself as having
the capacity to deploy workers abroad.
Evidence for the prosecution, however,
disclosed, that complainants would not have
known Julie Micua were if not for appellant who
even accompanied them to Manila to see Julie
Micua. It was appellant and her husband who
received almost all the payments of
complainants and who issued receipts signed by
Julie Micua. Certification from the POEA
showed that Meris and Julie Micua were not
licensed to recruit workers for overseas
employment.
In this appeal, appellant assailed the lack
of jurisdiction of the trial court over his person
because of the warrantless arrest and its findings
of fact.
ISSUE: Whether or not Meris committed the
crimes large-scale illegal recruitment and estafa.
HELD: Yes. The prosecution undoubtedly
proved that Meris, without license or authority,
engaged in recruitment and placement activities.
This was done in collaboration with Julie Micua,
when they promised complainants’ employment
in Hong Kong. Art. 13, par. (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.”
Although Meris was not an employee of the
alleged illegal recruiter Julie Micua, the
evidence show that she was the one who
approached complainants and prodded them to
seek employment abroad. It was through her that
they met Julia Micua. This is clearly an act of
referral. Worse, accused-appellant declared that
she was capable of placing them in jobs
overseas. Suffice it to say that complainants’
recruitment would not have been consummated
were it not for the direct participation of
accused-appellant in the recruitment process.
12
LABOR LAW 1
Dispositive Portion: WHEREFORE, the decision in
question is hereby AFFIRMED subject to the
modification that in each of the six (6) estafa cases,
the indeterminate sentence that appellant Leonida
Meris y Padilla must serve is two (2) years and four
(4) months of prision correccional as minimum to six
(6) years and one (1) day of prision mayor maximum.
Costs against appellant.
Darvin v Court of Appeals (G.R. No. 125044,
July 13, 1998)
1. Criminal Law; Labor Law; Illegal
Recruitment; Elements.—Applied to the
present case, to uphold the conviction of
accused-appellant, two elements need to be
shown: (1) the person charged with the
crime must have undertaken recruitment
activities; and (2) the said person does not
have a license or authority to do so.
2. Same; Same; Same; To prove that the
accused was engaged in recruitment
activities as to commit the crime of illegal
recruitment, it must be shown that the
accused gave the victim the impression
that she had the power or ability to send
the latter abroad for work such that the
latter was convinced to part with her
money in order to be so employed.—It is
not disputed that accused-appellant does not
have a license or authority to engage in
recruitment activities. The pivotal issue to
be determined, therefore, is whether the
accused-appellant indeed engaged in
recruitment activities, as defined under the
Labor Code. Applying the rule laid down in
the case of People v. Goce, to prove that
accused-appellant was engaged in
recruitment activities as to commit the crime
of illegal recruitment, it must be shown that
the accused-appellant gave private
respondent the distinct impression that she
had the power or ability to send the private
respondent abroad for work such that the
latter was convinced to part with her money
in order to be so employed.
3. Same; Same; Same; The claim of the
accused that the P150,000.00 was for
payment of the complainant’s air fare and
US visa and other expenses cannot be
ignored where the receipt for the
P150,000.00, which was presented by both
parties during the trial of the case, stated
that it was “f or Air Fare and Visa to
RMC School of Law
ART. 12 – 42 et al.
USA.”—In this case, we find no sufficient
evidence to prove that accused-appellant
offered a job to private respondent. It is not
clear that accused gave the impression that
she was capable of providing the private
respondent work abroad. What is
established, however, is that the private
respondent gave accused-appellant
P150,000.00. The claim of the accused that
the P150,000.00 was for payment of private
respondent’s air fare and US visa and other
expenses cannot be ignored because the
receipt for the P150,000.00, which was
presented by both parties during the trial of
the case, stated that it was “for Air Fare and
Visa to USA.” Had the amount been for
something else in addition to air fare and
visa expenses, such as work placement
abroad, the receipt should have so stated.
4. Same; Same; Same; By themselves,
procuring a passport, airline tickets and
foreign visa for another individual,
without more, can hardly qualify as
recruitment activities.—By themselves,
procuring a passport, airline tickets and
foreign visa for another individual, without
more, can hardly qualify as recruitment
activities. Aside from the testimony of
private respondent, there is nothing to show
that accused-appellant engaged in
recruitment activities. We also note that the
prosecution did not present the testimonies
of witnesses who could have corroborated
the charge of illegal recruitment, such as
Florencio Rivera, and Leonila Rivera, when
it had the opportunity to do so. As it stands,
the claim of private respondent that accused-
appellant promised her employment abroad
is uncorroborated. All these, taken
collectively, cast reasonable doubt on the
guilt of the accused.
5. Same; Presumption of Innocence; Proof
beyond reasonable doubt does not mean
such a degree of proof as, excluding the
possibility of error, produces absolute
certainty—moral certainty only is required,
or that degree of proof which produces
conviction in an unprejudiced mind, but
suspicion alone is insufficient.—In criminal
cases, the burden is on the prosecution to
prove, beyond reasonable doubt, the
essential elements of the offense with which
the accused is charged; and if the proof fails
to establish any of the essential elements
necessary to constitute a crime, the
defendant is entitled to an acquittal. Proof
Laong Laan 13
LABOR LAW 1
beyond reasonable doubt does not mean
such a degree of proof as, excluding the
possibility of error, produces absolute
certainty. Moral certainty only is required,
or that degree of proof which produces
conviction in an unprejudiced mind. At best,
the evidence proffered by the prosecution
only goes so far as to create a suspicion that
accused-appellant probably perpetrated the
crime charged. But suspicion alone is
insufficient, the required quantum of
evidence being proof beyond reasonable
doubt. When the People’s evidence fail to
indubitably prove the accused’s authorship
of the crime of which he stands accused,
then it is the Court’s duty, and the accused’s
right, to proclaim his innocence. Acquittal,
therefore, is in order.
FACTS: Imelda Darvin was convicted of simple
illegal recruitment under the Labor Code by the
RTC. It stemmed from a complaint of one
Macaria Toledo who was convinced by the
petitioner that she has the authority to recruit
workers for abroad and can facilitate the
necessary papers in connection thereof. In view
of this promise, Macaria gave her P150,000
supposedly intended for US Visa and air fare.
On appeal, the CA affirmed the decision of the
trial court in toto, hence this petition.
ISSUE: Whether or not appellant is guilty
beyond reasonable doubt of illegal recruitment.
Held: Art. 13 of the Labor Code provides the
definition of recruitment and placement as:
...b.) 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 reason 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.
Art. 38 of the Labor Code provides:
a.)Any recruitment activities, including the
prohibited practices enumerated under Article 43
of the Labor Code, to be undertaken by non-
licensees or non-holders of authority shall be
RMC School of Law
ART. 12 – 42 et al.
deemed illegal and punishable under Article 39
of the Labor Code.
Applied to the present case, to uphold
the conviction of accused-appellant, two
elements need to be shown: (1) the person
charged with the crime must have undertaken
recruitment activities: and (2) the said person
does not have a license or authority to do so.
In the case, the Court found no
sufficient evidence to prove that accused-
appellant offered a job to private respondent. It
is not clear that accused gave the impression that
she was capable of providing the private
respondent work abroad. What is established,
however, is that the private respondent gave
accused-appellant P150,000.
By themselves, procuring a passport,
airline tickets and foreign visa for another
individual, without more, can hardly qualify as
recruitment activities. Aside from the testimony
of private respondent, there is nothing to show
that appellant engaged in recruitment activities.
At best, the evidence proffered by the
prosecution only goes so far as to create a
suspicion that appellant probably perpetrated the
crime charged. But suspicion alone is
insufficient, the required quantum of evidence
being proof beyond reasonable doubt. When the
People’s evidence fail to indubitably prove the
accused’s authorship of the crime of which he
stand accused, then it is the Court’s duty, and the
accused’s right, to proclaim his innocence.
Dispositive Portion: WHEREFORE, the appeal is
hereby granted and the decision of the CA is
REVERSED and SET ASIDE. Appellant is hereby
ACQUITTED on ground of reasonably doubt. The
accused is ordered immediately released from her
confinement.
ACCESS v. NLRC (G.R. No. 131656, October
12, 1998)
1. Remedial Law; Actions; Jurisdiction; As a
rule, jurisdiction is determined by the law at
the time of the commencement of the action;
RA 8042 which took effect in July 1995
applies to the case at bar.—As a rule,
jurisdiction is determined by the law at the time
of the commencement of the action. In the case
at bar, private respondent’s cause of action did
not accrue on the date of his employment or on
Laong Laan 14
LABOR LAW 1
February 28, 1995. His cause of action arose
only from the time he was illegally dismissed by
petitioner from service in June 1996, after his
vacation leave expired. It is thus clear that R.A.
8042 which took effect a year earlier in July
1995 applies to the case at bar.
2. Same; Judgment; Where there is a conflict
between the dispositive portion or the fallo
and the body of the decision, the fallo
controls; Where the inevitable conclusion
from the body of the decision is so clear as to
show that there was a mistake in the
dispositive portion, the body of the decision
will prevail.—The general rule is that where
there is a conflict between the dispositive
portion or the fallo and the body of the decision,
the fallo controls. This rule rests on the theory
that the fallo is the final order while the opinion
in the body is merely a statement ordering
nothing. However, where the inevitable
conclusion from the body of the decision is so
clear as to show that there was a mistake in the
dispositive portion, the body of the decision will
prevail.
3. Civil Law; Attorney’s Fees; Private
respondent was compelled to file an action for
illegal dismissal with the labor arbiter and
hence entitled to an award of attorney’s
fees.—In the case at bar, petitioner’s bad faith in
dismissing private respondent is manifest.
Respondent was made to believe that he would
be temporarily leaving Jeddah, Kingdom of
Saudi Arabia, for a 30-day vacation leave with
pay. However, while on board the plane back to
the Philippines, his co-employees told him that
he has been dismissed from his job as he was
given only a one-way plane ticket by petitioner.
True enough, private respondent was not
allowed to return to his jobsite in Jeddah after
his vacation leave. Thus, private respondent was
compelled to file an action for illegal dismissal
with the labor arbiter and hence entitled to an
award of attorney’s fees.
FACTS: Petitioner (Asian Center for Career and
Employment System and Services or ACCES)
hired respondent IBNO MEDIALES to work as
a mason in Jeddah, Saudi Arabia with a monthly
salary of 1,200 Saudi Riyals (SR). The term of
his contract was two (2) years, from February
28, 1995 until February 28, 1997. On May 26,
1996, respondent applied with petitioner for
vacation leave with pay and was granted. While
en route to the Philippines, his co-workers
informed him that he has been dismissed.
RMC School of Law Laong Laan
ART. 12 – 42 et al.
respondent filed a complaint with the labor
arbiter for illegal dismissal. And found guilty
and to pay the unexpired portion of the
respondent ‘s contract which is 1,200 multiplied
by 8 months representing the unexpired portion.
Petitioner appealed to the NLRC but the latter
affirmed the decision of labor arbiter but
modified the appealed decision by deleting the
order of refund of excessive placement fee for
lack of jurisdiction. Petitioner moved for
reconsideration with respect to the labor
arbiter’s award by invoking Section 10 RA 8042
that a worker dismissed from overseas
employment without just, valid or authorized
cause is entitled to his salary for the unexpired
portion of his employment contract or for three
(3) months for every year of the unexpired term,
whichever is less that is why it should be three
years should be used for the unexpired portion.
NLRC denied the motion. Hence, this petition
for certiorari.
ISSUE: Whether or not the monetary awards
granted by the NLRC to private respondent is
correct?
HELD: The SC affirmed the decisions of NLRC
with modifications regarding the basis of
amount that the petitioner will pay to the
respondent for the unexpired portion of
employment contract. In the case at bar,
petitioner’s illegal dismissal from service is no
longer disputed. Petitioner merely impugns the
monetary awards granted by the NLRC to
private respondent. The effectivity of Section 10
RA 8042 took effect a year earlier from his
vacation leave. Hence, it applies to the case. The
respondent should be paid by petitioner the 3
months unexpired portion of the contract.
Dispositive Portion: IN VIEW OF THE
FOREGOING, the decision of the public respondent
National Labor Relations Commission, dated
October 14, 1997, is AFFIRMED with modifications:
petitioner is ordered to pay private respondent IBNO
MEDIALES the peso equivalent of the amounts of
SR3,600 for the unexpired portion of his employment
contract, and SR360 for attorney’s fees. No costs.
15
LABOR LAW 1
Eastern Shipping Lines v. POEA (G.R. No.
77828 February 8, 1989)
1. Remedial Law; Civil Procedure; Exhaustion
of Administrative Remedies; Certiorari; Since
the instant petition involves essentially
questions of legal nature, it cannot be
considered to have been prematurely filed
with the Supreme Court despite failure of
petitioner to appeal to the N.L.R.C.- A
preliminary point was raised by the Solicitor
General in his Comment on the Petition, that
Eastern had failed to exhaust administrative
remedies in this case—i.e., that petitioner
Company did not interpose an appeal with the
National Labor Relations Commission before
coming to this Court on certiorari. Inasmuch,
however, as the petition at bar raises questions
essentially legal in nature, we do not consider the
same as having been prematurely filed with this
Court.
2. Remedial Law; Labor Law; POEA,
Jurisdiction Of; The statute creating the
POEA and the regulations governing Filipino
workers for overseas employment do not limit
their coverage to non-Filipino employers.- We
address first the issue of jurisdiction. Petitioner
Company does not deny that Manuel Zaragoza
was its employee at the time of his death on 18
September 1983. Petitioner would contend,
however, that the company had neither been nor
acted as an “overseas employer” of Manuel
Zaragoza, and that the latter had never been its
“overseas employee.” Hence, petitioner
concludes, private respondent’s claim for death
benefits should have been filed with the Social
Security System, not with the POEA. The
argument does not persuade. Applicable here—
and petitioner admits this in its Petition—is
Executive Order No. 797 (promulgated 1 May
1982), which abolished the former National
Seamen Board and created in its place the
present Philippine Overseas Employment
Administration. Section 4 (a) of Executive Order
No. 797 expressly provides that the POEA “shall
have original and exclusive jurisdiction over all
cases, including money claims, involving
employer-employee relations arising out of or by
virtue of any law or contract involving Filipino
workers for overseas employment, including
seamen.” This provision is clarified substantially
in the Rules and Regulations on Overseas
Employment issued by the POEA, Section 1 (d),
Rule I, Book VI of which provides that “claims
for death, disability and other benefits arising out
RMC School of Law Laong Laan
ART. 12 – 42 et al.
of [overseas] employment” fall within the
POEA’s original and exclusive jurisdiction. x x x
We note that the statute and the relevant
regulations refer to employment of Filipino
workers overseas. i.e., outside the Philippines.
The statute and regulations do not limit their
coverage to non-Filipino employers. Filipinos
working overseas share the same risks and
burdens whether their employers be Filipino or
foreign.
FACTS: A Chief Officer of a ship was killed in
an accident in Japan. The widow filed a
complaint for charges against the Eastern
Shipping Lines with POEA, based on a
Memorandum Circular No. 2, issued by the
POEA which stipulated death benefits and burial
for the family of overseas workers. ESL
questioned the validity of the memorandum
circular as violative of the principle of non-
delegation of legislative power. It contends that
no authority had been given the POEA to
promulgate the said regulation; and even with
such authorization, the regulation represents an
exercise of legislative discretion which, under
the principle, is not subject to delegation.
Nevertheless, POEA assumed jurisdiction and
decided the case.
ISSUE: Whether or not the Issuance of
Memorandum Circular No. 2 is a violation of
non-delegation of powers.
RULING: No. SC held that there was a valid
delegation of powers. The authority to issue the
said regulation is clearly provided in Section
4(a) of Executive Order No. 797. ... "The
governing Board of the Administration (POEA),
as hereunder provided shall promulgate the
necessary rules and regulations to govern the
exercise of the adjudicatory functions of the
Administration (POEA)."
It is true that legislative discretion as to the
substantive contents of the law cannot be
delegated. What can be delegated is the
discretion to determine how the law may be
enforced, not what the law shall be. The
ascertainment of the latter subject is a
prerogative of the legislature. This prerogative
16
LABOR LAW 1
cannot be abdicated or surrendered by the 1.
legislature to the delegate.
The reasons given above for the
delegation of legislative powers in general are
particularly applicable to administrative bodies.
With the proliferation of specialized activities
and their attendant peculiar problems, the
national legislature has found it more and more
necessary to entrust to administrative agencies
the authority to issue rules to carry out the
general provisions of the statute. This is called
the "power of subordinate legislation."
With this power, administrative bodies
may implement the broad policies laid down in a
statute by "filling in' the details which the
Congress may not have the opportunity or
competence to provide. This is effected by their
promulgation of what are known as 2.
supplementary regulations, such as the
implementing rules issued by the Department of
Labor on the new Labor Code. These regulations
have the force and effect of law.
There are two accepted tests to
determine whether or not there is a valid
delegation of legislative power:
1. Completeness test - the law must be
complete in all its terms and conditions
when it leaves the legislature such that when
it reaches the delegate the only thing he will
have to do is enforce it.
2. Sufficient standard test - there must be
adequate guidelines or stations in the law to
map out the boundaries of the delegate's
authority and prevent the delegation from
running riot.
Both tests are intended to prevent a total
transference of legislative authority to the
delegate, who is not allowed to step into the
shoes of the legislature and exercise a power
essentially legislative.
Dispositive Portion: WHEREFORE, the Petition for 3.
Certiorari is DISMISSED and the Decision of the
POEA in POEA Case No. L-86-01-026 is hereby
AFFIRMED. The Temporary Restraining Order of 8
April 1987 is hereby LIFTED.
Eastern Mediterranean Maritime Ltd. v.
Surio (G.R. No. 154213 August 23, 2012)
RMC School of Law Laong Laan
ART. 12 – 42 et al.
Remedial Law; Civil Procedure; Prospectivity
of Laws; As a rule, all laws are prospective in
application unless the contrary is expressly
provided or unless the law is procedural or
curative in nature―Petitioners’ position that
Republic Act No. 8042 should not be applied
retroactively to the review of the POEA’s
decision dismissing their complaint against
respondents has no support in jurisprudence.
Although, as a rule, all laws are prospective in
application unless the contrary is expressly
provided, or unless the law is procedural or
curative in nature, there is no serious question
about the retroactive applicability of Republic
Act No. 8042 to the appeal of the POEA’s
decision on petitioners’ disciplinary action
against respondents. In a way, Republic Act No.
8042 was a procedural law due to its providing
or omitting guidelines on appeal.
Same; Same; Appeals; A statute that
eliminates the right to appeal and considers
the judgment rendered final and
unappealable only destroys the right to
appeal, but not the right to prosecute an
appeal that has been perfected prior to its
passage, for, at that stage, the right to appeal
has already vested and cannot be
impaired.―Republic Act No. 8042 applies to
petitioners’ complaint by virtue of the case being
then still pending or undetermined at the time of
the law’s passage, there being no vested rights in
rules of procedure. They could not validly insist
that the reckoning period to ascertain which law
or rule should apply was the time when the
disciplinary complaint was originally filed in the
POEA in 1993. Moreover, Republic Act No.
8042 and its implementing rules and regulations
were already in effect when petitioners took their
appeal. A statute that eliminates the right to
appeal and considers the judgment rendered final
and unappealable only destroys the right to
appeal, but not the right to prosecute an appeal
that has been perfected prior to its passage, for,
at that stage, the right to appeal has already
vested and cannot be impaired.
Same; Same; Same; When Republic Act No.
8042 withheld the appellate jurisdiction of the
National Labor Relations Commission
(NLRC) in respect of cases decided by the
Philippine Overseas Employment
Administration (POEA), the appellate
jurisdiction was vested in the Secretary of
Labor in accordance with his power of
supervision and control.―When Republic Act
No. 8042 withheld the appellate jurisdiction of
the NLRC in respect of cases decided by the
17
LABOR LAW 1
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, to wit:
Section 38. Definition of Administrative
Relationship.―Unless otherwise expressly stated
in the Code or in other laws defining the special
relationships of particular agencies,
administrative relationships shall be categorized
and defined as follows: Supervision and
Control.―Supervision and control shallinclude
authority to act directly whenever a specific
function is entrusted by law or regulation to a
subordinate; direct the performance of duty;
restrain the commission of acts; review, approve,
reverse or modify acts and decisions of
subordinate officials or units; determine
priorities in the execution of plans and programs.
Unless a different meaning is explicitly provided
in the specific law governing the relationship of
particular agencies, the word “control” shall
encompass supervision and control as defined in
this paragraph. xxx.
Facts: MT Seadance is a vessel owned by
Eastern Mediterranean Maritime Ltd and
manned and operated by Agemar Manning
Agency. The same was not in a good working
condition and the payment of wages, remittance
of allotments, as well as the payment for extra
work and extra overtime work were delayed. As
MT Seadance docked at a port in Sweden,
representatives of International Transport
Federation boarded the same. They have found
out that wages of its crew members were below
the prevailing rates. As a result, they have
moved to increase the wages of the said
crewmembers. On Dec 23, 1993, the petitioners
filed a complaint against the crew members and
claimed reimbursement for the increase of
wages received.
Issue: Whether or not it is under the jurisdiction
of NLRC to review cases on appeal decided by
POEA.
Held: No, the NLRC has no jurisdiction to
review an appeal case decided by POEA.
According to Section 28 (b) of the Omnibus
Rules and Regulations Implementing the
Migrant Workers and Overseas Filipinos Act of
1995, the POEA shall exercise original and
RMC School of Law Laong Laan
ART. 12 – 42 et al.
exclusive jurisdiction to hear and decide
disciplinary action cases and other special cases,
which are administrative in character, involving
employers, principals, contracting partners and
Filipino migrant workers. Since RA No 8042
has been passed into a law after the filing of
charges by the petitioner to the respondents, the
rule on retroactivity of the laws shall be
observed. As a rule, all laws are prospective in
application unless the contrary is expressly
provided, or unless the law is procedural or
curative in nature. Thus, such law stating that
the POEA has the jurisdiction to decide on
disciplinary cases shall be observed in the case
at bar.
Dispositive Portion: WHEREFORE, we AFFIRM the
decision promulgated on December 21, 2001 by the
Court of Appeals; and ORDER the petitioners to pay
the costs of suit.
De Jesus v. National Labor Relations
Commission (G.R. No. 151158, August 17,
2007)
1. Labor Law; Appeals; Judicial review by this
Court does not extend to a re-evaluation of
the sufficiency of the evidence upon which the
proper labor tribunal has based its
determination—firm is the doctrine that this
Court is not a trier of facts, and this applies
with greater force in labor cases.-It is a settled
rule that under Rule 45 of the Rules of Court,
only questions of law may be raised before this
Court. Judicial review by this Court does not
extend to a re-evaluation of the sufficiency of the
evidence upon which the proper labor tribunal
has based its determination. Firm is the doctrine
that this Court is not a trier of facts, and this
applies with greater force in labor cases.
However, factual issues may be considered and
resolved when the findings of facts and
conclusions of law of the Labor Arbiter are
inconsistent with those of the NLRC and the
Court of Appeals, as in this case.
2. Labor Law; Disease; The rule is that an
ailment contracted by a worker even prior to
his employment, does not detract from the
compensability of the disease.- The evidence
shows that De Jesus previously suffered from
ulcer but he ticked “NO” in his medical history.
De Jesus, therefore, committed
misrepresentation. Nonetheless, he passed the
18
LABOR LAW 1
pre-employment medical examination, was
reported fit to work, and was suffered to work on
board M/V Author for more than two (2)
months, until his repatriation on June 19, 1997.
The rule is that an ailment contracted even prior
to his employment, does not detract from the
compensability of the disease. It is not required
that the employment be the sole factor in the
growth, development or acceleration of the
illness to entitle the claimant to the benefits
incident thereto. It is enough that the
employment had contributed, even in a small
measure, to the development of the disease.
3. Labor Law; Disease; A worker’s
misrepresentation cannot be made the basis
by his employer for the denial of his claims
under the contract where he passed the
required pre-medical examination and was
declared fit to work.- In OSM Shipping
Philippines, Inc. v. Dela Cruz, 449 SCRA 525
(2005), this Court, in granting similar claims,
held: Labor contracts are impressed with public
interest and the provisions of the POEA Standard
Employment Contract must be construed fairly,
reasonably and liberally in favor of Filipino
seamen in the pursuit of their employment on
board ocean-going vessels. Despite his
misrepresentation, Arbit underwent and passed
the required pre-medical examination, was
declared fit to work, and was suffered to work by
petitioner. Upon repatriation, he complied with
the required post-employment medical
examination. Under the beneficent provisions of
the Contract, it is enough that the work has
contributed, even in a small degree, to the
development of the disease and in bringing about
his death. Strict proof of causation is not
required. De Jesus’ misrepresentation cannot,
therefore, be made basis by POMI for the denial
of his claims under the contract.
4. Labor Law; Illegal Dismissals; Burden of
Proof; Settled is the rule that in termination
cases, the burden of proof rests upon the
employer to show that the dismissal is for a
just and valid cause.- Settled is the rule that in
termination cases, the burden of proof rests upon
the employer to show that the dismissal is for a
just and valid cause. The case of the employer
must stand or fall on its own merits and not on
the weakness of the employee’s defense. In this
case, no convincing proof was offered to prove
POMI’s allegation. All that we have is its self-
serving assertion that De Jesus violated his
employment contract. There is no proof that the
prescribed disciplinary procedure was followed.
We, therefore, agree with the Labor Arbiter’s
RMC School of Law Laong Laan
ART. 12 – 42 et al.
finding that POMI utterly failed to establish its
claim of valid dismissal. Accordingly, the NLRC
and Court of Appeals erred in reversing the said
finding.
Dispositive Portion: WHEREFORE, the petition
is GRANTED. The Decision of the Court of Appeals
in CA-G.R. SP. No. 58241, and its Resolution dated
December 21, 2001, are REVERSED and SET
ASIDE. The Decision dated August 28, 1998 of the
Labor Arbiter is REINSTATED. SO ORDERED.
Sameer Overseas Placement Agency v.
Cabiles (G.R. No. 170139, August 05, 2014)
1. Labor Law; Termination of Employment;
Employers cannot be compelled to retain the
services of an employee who is guilty of acts
that are inimical to the interest of the
employer.—Indeed, employers have the
prerogative to impose productivity and quality
standards at work. They may also impose
reasonable rules to ensure that the employees
comply with these standards. Failure to comply
may be a just cause for their dismissal. Certainly,
employers cannot be compelled to retain the
services of an employee who is guilty of acts that
are inimical to the interest of the employer.
While the law acknowledges the plight and
vulnerability of workers, it does not “authorize
the oppression or self-destruction of the
employer.” Management prerogative is
recognized in law and in our jurisprudence. This
prerogative, however, should not be abused. It is
“tempered with the employee’s right to security
of tenure.” Workers are entitled to substantive
and procedural due process before termination.
They may not be removed from employment
without a valid or just cause as determined by
law and without going through the proper
procedure.
2. Same; Same; Inefficiency; To show that
dismissal resulting from inefficiency in work
is valid, it must be shown that: 1) the
employer has set standards of conduct and
workmanship against which the employee will
be judged; 2) the standards of conduct and
workmanship must have been communicated
to the employee; and 3) the communication
was made at a reasonable time prior to the
employee’s performance assessment.—The
burden of proving that there is just cause for
termination is on the employer. “The employer
must affirmatively show rationally adequate
evidence that the dismissal was for a justifiable
19
LABOR LAW 1
cause.” Failure to show that there was valid or
just cause for termination would necessarily
mean that the dismissal was illegal. To show that
dismissal resulting from inefficiency in work is 5.
valid, it must be shown that: 1) the employer has
set standards of conduct and workmanship
against which the employee willbe judged; 2) the
standards of conduct and workmanship must
have been communicated to the employee; and
3) the communication was made at a reasonable
time prior to the employee’s performance
assessment.
3. Same; Probationary Employees; Due Process;
Due process requires that the probationary
employee be informed of such standards at
the time of his or her engagement so he or she
can adjust his or her character or
workmanship accordingly.—The
predetermined standards that the employer sets
are the bases for determining the probationary
employee’s fitness, propriety, efficiency, and
qualifications as a regular employee. Due
process requires that the probationary employee
be informed of such standards at the time of his
or her engagement so he or she can adjust his or
her character or workmanship accordingly.
Proper adjustment to fit the standards upon
which the employee’s qualifications will be
evaluated will increase one’s chances of being
positively assessed for regularization by his or
her employer.
4. Same; Termination of Employment; Two- 6.
Notice Rule; The employer is required to give
the charged employee at least two written
notices before termination; Aside from the
notice requirement, the employee must also be
given “an opportunity to be heard.”—A valid
dismissal requires both a valid cause and
adherence to the valid procedure of dismissal.
The employer is required to give the charged
employee at least two written notices before
termination. One of the written notices must
inform the employee of the particular acts that
may cause his or her dismissal. The other notice
must “[inform] the employee of the employer’s
decision.” Aside from the notice requirement, the
employee must also be given “an opportunity to
be heard.” Petitioner failed to comply with the
twin notices and hearing requirements.
Respondent started working on June 26, 1997.
She was told that she was terminated on July 14,
1997 effective on the same day and barely a
month from her first workday. She was also
repatriated on the same day that she was
informed of her termination. The abruptness of
the termination negated any finding that she was
RMC School of Law Laong Laan
ART. 12 – 42 et al.
properly notified and given the opportunity to be
heard. Her constitutional right to due process of
law was violated.
Same; Same; Migrant Workers and Overseas
Filipinos Act of 1995 (R.A. No. 8042); Section
10 of Republic Act (R.A.) 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.”—Respondent Joy Cabiles,
having been illegally dismissed, is entitled to her
salary for the unexpired portion of the
employment contract that was violated together
with attorney’s fees and reimbursement of
amounts withheld from her salary. 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.”
Same; Same; Same; Repatriation; Section 15
of Republic Act (R.A.) No. 8042 states that
“repatriation of the worker and the transport
of his [or her] personal belongings shall be the
primary responsibility of the agency which
recruited or deployed the worker overseas.”—
Section 15 of Republic Act No. 8042 states that
“repatriation of the worker and the transport of
his [or her] personal belongings shall be the
primary responsibility of the agency which
recruited or deployed the worker overseas.” The
exception is when “termination of employment is
due solely to the fault of the worker,” which as
we have established, is not the case. It reads:
SEC. 15. REPATRIATION OF WORKERS;
EMERGENCY REPATRIATION FUND.—The
repatriation of the worker and the transport of his
personal belongings shall be the primary
responsibility of the agency which recruited or
deployed the worker overseas. All costs
attendant to repatriation shall be borne by or
charged to the agency concerned and/or its
principal. Likewise, the repatriation of remains
and transport of the personal belongings of a
deceased worker and all costs attendant thereto
20
LABOR LAW 1
shall be borne by the principal and/or local
agency. However, in cases where the termination
of employment is due solely to the fault of the
worker, the principal/employer or agency shall
not in any manner be responsible for the
repatriation of the former and/or his belongings.
7. Same; Same; Attorneys Fees; The Labor
Code also entitles the employee to 10% of the
amount of withheld wages as attorney’s fees
when the withholding is unlawful.—The Labor
Code also entitles the employee to 10% of the
amount of withheld wages as attorney’s fees
when the withholding is unlawful. 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.
8. Same; Same; Constitutional Law; Equal
Protection of the Laws; Due Process; In
Serrano v. Gallant Maritime Services, Inc.
and Marlow Navigation Co., Inc., 582 SCRA
254 (2009), the Supreme Court (SC) 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.—In Serrano v. Gallant Maritime
Services, Inc. and Marlow Navigation Co., Inc.,
582 SCRA 254 (2009), 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.” We 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.
9. Statutory Construction; Statutes; When a law
or a provision of law is null because it is
inconsistent with the Constitution, the nullity
cannot be cured by reincorporation or
reenactment of the same or a similar law or
RMC School of Law
ART. 12 – 42 et al.
provision.—In the hierarchy of laws, the
Constitution is supreme. No branch or office of
the government may exercise its powers in any
manner inconsistent with the Constitution,
regardless of the existence of any law that
supports such exercise. The Constitution cannot
be trumped by any other law. All laws must be
read in light of the Constitution. Any law that is
inconsistent with it is a nullity. Thus, when a law
or a provision of law is null because it is
inconsistent with the Constitution, the nullity
cannot be cured by reincorporation or
reenactment of the same or a similar law or
provision. A law or provision of law that was
already declared unconstitutional remains as
such unless circumstances have so changed as to
warrant a reverse conclusion.
10. Constitutional Law; Equal Protection of the
Laws; Due Process; Equal protection of the
law is a guarantee that persons under like
circumstances and falling within the same
class are treated alike, in terms of “privileges
conferred and liabilities enforced.”—We
observe that the reinstated clause, this time as
provided in Republic Act. No. 10022, violates
the constitutional rights to equal protection and
due process. Petitioner as well as the Solicitor
General have failed to show any compelling
change in the circumstances that would warrant
us to revisit the precedent. We reiterate our
finding in Serrano v. Gallant Maritime that
limiting wages that should be recovered by an
illegally dismissed overseas worker to three
months is both a violation of due process and the
equal protection clauses of the Constitution.
Equal protection of the law is a guarantee that
persons under like circumstances and falling
within the same class are treated alike, in terms
of “privileges conferred and liabilities enforced.”
It is a guarantee against “undue favor and
individual or class privilege, as well as hostile
discrimination or the oppression of inequality.”
11. Same; Same; There is no violation of the
equal protection clause if the law applies
equally to persons within the same class and if
there are reasonable grounds for
distinguishing between those falling within the
class and those who do not fall within the
class.—In creating laws, the legislature has the
power “to make distinctions and classifications.”
In exercising such power, it has a wide
discretion. The equal protection clause does not
infringe on this legislative power. A law is void
on this basis, only if classifications are made
arbitrarily. There is no violation of the equal
protection clause if the law applies equally to
Laong Laan 21
LABOR LAW 1
persons within the same class and if there are
reasonable grounds for distinguishing between
those falling within the class and those who do
not fall within the class. A law that does not
violate the equal protection clause prescribes a
reasonable classification. A reasonable
classification “(1) must rest on substantial
distinctions; (2) must be germane to the purposes
of the law; (3) must not be limited to existing
conditions only; and (4) must apply equally to all
members of the same class.” The reinstated
clause does not satisfy the requirement of
reasonable classification.
12. Same; Same; There can never be a
justification for any form of government
action that alleviates the burden of one sector,
but imposes the same burden on another
sector, especially when the favored sector is
composed of private businesses such as
placement agencies, while the disadvantaged
sector is composed of Overseas Filipino
Workers (OFWs) whose protection no less
than the Constitution commands.—[T]here
can never be a justification for any form of
government action that alleviates the burden of
one sector, but imposes the same burden on
another sector, especially when the favored
sector is composed of private businesses such as
placement agencies, while the disadvantaged
sector is composed of OFWs whose protection
no less than the Constitution commands. The
idea that private business interest can be elevated
to the level of a compelling state interest is
odious.” Along the same line, we held that the
reinstated clause violates due process rights. It is
arbitrary as it deprives overseas workers of their
monetary claims without any discernable valid
purpose. Respondent Joy Cabiles is entitled to
her salary for the unexpired portion of her
contract, in accordance with Section 10 of
Republic Act No. 8042. The award of the three-
month equivalence of respondent’s salary must
be modified accordingly. Since she started
working on June 26, 1997 and was terminated on
July 14, 1997, respondent is entitled to her salary
from July 15, 1997 to June 25, 1998. “To rule
otherwise would be iniquitous to petitioner and
other OFWs, and would, in effect, send a wrong
signal that principals/employers and
recruitment/manning agencies may violate an
OFW’s security of tenure which an employment
contract embodies and actually profit from such
violation based on an unconstitutional provision
of law.”
13. Interest Rates; Bangko Sentral ng Pilipinas
Circular No. 799; The Bangko Sentral ng
RMC School of Law Laong Laan
ART. 12 – 42 et al.
Pilipinas (BSP) Circular No. 799 of June 21,
2013, which revised the interest rate for loan
or forbearance from 12% to 6% in the
absence of stipulation, applies in this case.—
On the interest rate, the Bangko Sentral ng
Pilipinas Circular No. 799 of June 21, 2013,
which revised the interest rate for loan or
forbearance from 12% to 6% in the absence of
stipulation, applies in this case. The pertinent
portions of Circular No. 799, Series of 2013,
read: The Monetary Board, in its Resolution No.
796 dated 16 May 2013, approved the following
revisions governing the rate of interest in the
absence of stipulation in loan contracts, thereby
amending Section 2 of Circular No. 905, Series
of 1982: Section 1. The rate of interest for the
loan or forbearance of any money, goods or
credits and the rate allowed in judgments, in the
absence of an express contract as to such rate of
interest, shall be six percent (6%) per annum.
Section 2. In view of the above, Subsection
X305.1 of the Manual of Regulations for Banks
and Sections 4305Q.1, 4305S.3 and 4303P.1 of
the Manual of Regulations for Non-Bank
Financial Institutions are hereby amended
accordingly. This Circular shall take effect on 1
July 2013.
14. Same; Same; Loans; Circular No. 799 is
applicable only in loans and forbearance of
money, goods, or credits, and in judgments
when there is no stipulation on the applicable
interest rate; Circular No. 799 is not
applicable when there is a law that states
otherwise.—Circular No. 799 is applicable only
in loans and forbearance of money, goods, or
credits, and in judgments when there is no
stipulation on the applicable interest rate.
Further, it is only applicable if the judgment did
not become final and executory before July 1,
2013. We add that Circular No. 799 is not
applicable when there is a law that states
otherwise. While the Bangko Sentral ng Pilipinas
has the power to set or limit interest rates, these
interest rates do not apply when the law provides
that a different interest rate shall be applied. “[A]
Central Bank Circular cannot repeal a law. Only
a law can repeal another law.”
15. Same; Same; Labor Law; Placement Fees;
There is an implied stipulation in contracts
between the placement agency and the
overseas worker that in case the overseas
worker is adjudged as entitled to
reimbursement of his or her placement fees,
the amount shall be subject to a 12% interest
per annum. This implied stipulation has the
effect of removing awards for reimbursement
22
LABOR LAW 1
of placement fees from Circular No. 799’s
coverage.—Laws are deemed incorporated in
contracts. “The contracting parties need not
repeat them. They do not even have to be
referred to. Every contract, thus, contains not
only what has been explicitly stipulated, but the
statutory provisions that have any bearing on the
matter.” There is, therefore, an implied
stipulation in contracts between the placement
agency and the overseas worker that in case the
overseas worker is adjudged as entitled to
reimbursement of his or her placement fees, the
amount shall be subject to a 12% interest per
annum. This implied stipulation has the effect of
removing awards for reimbursement of
placement fees from Circular No. 799’s
coverage.
16. Same; Same; Same; Awards of salary for the
unexpired portion of the employment contract
under Republic Act (R.A.) No. 8042 are
covered by Circular No. 799 because the law
does not provide for a specific interest rate
that should apply.—The same cannot be said
for awards of salary for the unexpired portion of
the employment contract under Republic Act No.
8042. These awards are covered by Circular No.
799 because the law does not provide for a
specific interest rate that should apply. In sum, if
judgment did not become final and executory
before July 1, 2013 and there was no stipulation
in the contract providing for a different interest
rate, other money claims under Section 10 of
Republic Act No. 8042 shall be subject to the 6%
interest per annum in accordance with Circular
No. 799. This means that respondent is also
entitled to an interest of 6% per annum on her
money claims from the finality of this judgment.
17. Labor Law; Overseas Filipino Workers;
Solidary Obligations; Migrant Workers and
Overseas Filipinos Act of 1995 (Republic Act
[R.A.] No. 8042); Section 10 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 including
claims arising out of an employer-employee
relationship and/or damages.—Section 10 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 including
claims arising out of an employer-employee
relationship and/or damages. This section also
provides that the performance bond filed by the
local agency shall be answerable for such money
claims or damages if they were awarded to the
RMC School of Law
ART. 12 – 42 et al.
employee. This provision is in line with the
state’s policy of affording protection to labor and
alleviating workers’ plight. In overseas
employment, the filing of money claims against
the foreign employer is attended by practical and
legal complications. The distance of the foreign
employer alone makes it difficult for an overseas
worker to reach it and make it liable for
violations of the Labor Code. There are also
possible conflict of laws, jurisdictional issues,
and procedural rules that may be raised to
frustrate an overseas worker’s attempt to
advance his or her claims.
18. Same; Same; Same; In the case of overseas
employment, either the local agency or the
foreign employer may be sued for all claims
arising from the foreign employer’s labor law
violations.—The fundamental effect of joint and
several liability is that “each of the debtors is
liable for the entire obligation.” A final
determination may, therefore, be achieved even
if only one of the joint and several debtors are
impleaded in an action. Hence, in the case of
overseas employment, either the local agency or
the foreign employer may be sued for all claims
arising from the foreign employer’s labor law
violations. This way, the overseas workers are
assured that someone — the foreign employer’s
local agent — may be made to answer for
violations that the foreign employer may have
committed. The Migrant Workers and Overseas
Filipinos Act of 1995 ensures that overseas
workers have recourse in law despite the
circumstances of their employment. By
providing that the liability of the foreign
employer may be “enforced to the full extent”
against the local agent, the overseas worker is
assured of immediate and sufficient payment of
what is due them.
19. Same; Same; Same; It must be emphasized
that the local agency that is held to answer for
the overseas worker’s money claims is not left
without remedy. The law does not preclude it
from going after the foreign employer for
reimbursement of whatever payment it has
made to the employee to answer for the
money claims against the foreign employer.—
Corollary to the assurance of immediate recourse
in law, the provision on joint and several liability
in the Migrant Workers and Overseas Filipinos
Act of 1995 shifts the burden of going after the
foreign employer from the overseas worker to
the local employment agency. However, it must
be emphasized that the local agency that is held
to answer for the overseas worker’s money
claims is not left without remedy. The law does
Laong Laan 23
LABOR LAW 1
not preclude it from going after the foreign
employer for reimbursement of whatever
payment it has made to the employee to answer
for the money claims against the foreign
employer. A further implication of making local
agencies jointly and severally liable with the
foreign employer is that an additional layer of
protection is afforded to overseas workers. Local
agencies, which are businesses by nature, are
inoculated with interest in being always on the
lookout against foreign employers that tend to
violate labor law. Lest they risk their reputation
or finances, local agencies must already have
mechanisms for guarding against unscrupulous
foreign employers even at the level prior to
overseas employment applications.
20. Constitutional Law; Equal Protection of the
Laws; View that take exception to the
ponencia’s full adoption of the ruling in
Serrano v. Gallant Maritime Services, Inc., et
al., 582 SCRA 254 (2009), to the extent that it
applies the strict scrutiny standard in
invoking the equal protection guarantee.—I
take exception to the ponencia’s full adoption of
the ruling in Serrano v. Gallant Maritime
Services, Inc., et al., 582 SCRA 254 (2009), to
the extent that it applies the strict scrutiny
standard in invoking the equal protection
guarantee. To my mind, the circumstances of this
case do not justify the ponencia’s approach of
extending and expanding the use of the strict
scrutiny standard in invalidating the subject
clause (as reinstated in R.A. No. 8042 by R.A.
No. 10022). The conclusion that the subject
clause created a “suspect” classification is
simply misplaced. The approach, sadly, only
unnecessarily shifted the burden to the
government, to prove: (1) a compelling state
interest; and (2) that the legislation is narrowly
tailored to achieve the intended result. It also
unnecessarily undermines the presumed
constitutionality of statutes and of the respect
that the Court accords to the acts of a co-equal
branch. The differential or rational basis
scrutiny, i.e., where the challenged classification
needs only be shown to be rationally related to
serving a legitimate state interest, would have
undoubtedly served the purpose without bringing
these unnecessary implications.
21. Labor Law; Overseas Filipino Workers;
Migrant Workers and Overseas Filipinos Act
of 1995 (R.A. No. 8042); View that Republic
Act (R.A.) No. 8042 is discernibly a piece of
social legislation that the State enacted in the
exercise of its police power, precisely to give
teeth and arms to the constitutional provisions
RMC School of Law Laong Laan
ART. 12 – 42 et al.
on labor under its aim to “establish a higher
standard of protection and promotion of the
welfare of migrant worker, their families and
of overseas Filipinos in distress.”—R.A. No.
8042 is discernibly a piece of social legislation
that the State enacted in the exercise of its police
power, precisely to give teeth and arms to the
constitutional provisions on labor under its aim
to “establish a higher standard of protection and
promotion of the welfare of migrant worker,
their families and of overseas Filipinos in
distress.” Otherwise stated, it draws power and
life from the constitutional provisions that it
seeks to concretize and implement. As I pointed
out in my Serrano Opinion, “the express policy
declarations of R.A. No. 8042 show that its
purposes are reiterations of the very same
policies enshrined in the Constitution x x x
[They] patently characterize R.A. No. 8042 as a
direct implementation of the constitutional
objectives on Filipino overseas work so that it
must be read and understood in terms of these
policy objectives. Under this interpretative guide,
any provision in R.A. No. 8042 inimical to the
interest of an overseas Filipino worker (OFW)
cannot have any place in the law.” [Underscoring
supplied] Note also (again, as I reflected in my
Serrano Opinion) that while R.A. No. 8042
acknowledges that the State shall “promote full
employment,” it likewise provides that “the State
does not promote overseas employment as a
means to sustain economic growth and national
development. The existence of overseas
employment program rests solely on the
assurance that the dignity and fundamental
human rights and freedom of Filipino citizens
shall not, at any time, be compromised and
violated.” The Act, however, concludes its
Declaration of Policies by stating that
“[n]onetheless, the deployment of Filipino
overseas workers, whether land-based or sea-
based, by local service contractors and manning
agencies employing them shall be encouraged.
Appropriate incentives may be extended to
them.”
22. Same; Same; Same; View that Section 10 of
Republic Act (R.A.) No. 8042 obviously
protects the Overseas Filipino Workers
(OFWs) as against the employer and the
recruitment agency in cases of unlawful
termination of service. Unfortunately, it limits
the liability to the “reimbursement of the
placement fee and interest, and the payment
of his salaries for the unexpired portion of his
employment contract or for three (3) months
for every year of the unexpired term,
24
LABOR LAW 1
whichever is less.”—Of particular importance to
the present case is Section 10 of R.A. No. 8042
which governs the OFWs’ money claims.
Pursuant to its terms, the Act obviously protects
the OFW as against the employer and the
recruitment agency in cases of unlawful
termination of service. Unfortunately, it limits
the liability to the “reimbursement of the
placement fee and interest, and the payment of
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.” This limitation is a step backward as it
imposes a cap on the liability of the foreign
principal/employer and the
contractor/recruitment agency even as it earlier
declared their liability joint and solidary. To be
an “appropriate incentive,” this limitation of
liability can only be justified under the terms of
the law, i.e., “the incentive must necessarily
relate to the law’s purpose with reasonable
expectation that it would serve this purpose; it
must also accrue to its intended beneficiaries (the
recruitment/placement agencies), and not to
parties to whom the reason for the grant does not
apply.”
23. Same; Same; Same; View that Section 10 of
Republic Act (R.A.) No. 8042 actually limits
what is otherwise the foreign
principal/employer’s full liability under the
Act and exceeds what the Act intended — to
grant incentives to recruitment/manning
agencies.—As I pointed out in my Serrano
Opinion, Section 10 of R.A. No. 8042 provides
measures that collectively protect OFWs, i.e., by
ensuring the integrity of their contracts; by
establishing the responsible parties; and by
providing the mechanisms for their enforcement
that imposes direct and primary liability to the
foreign principal employer. Yet, Section 10
presents a hidden twist affecting the
principal/employer’s liability. As worded, the
Act “simply limits the OFWs’ recovery in
wrongful dismissal situations. Thus, it redounds
to the benefit of whoever may be liable,
including the principal/employer — the direct
employer primarily liable for the wrongful
dismissal.” From this perspective, Section 10
actually limits what is otherwise the foreign
principal/employer’s full liability under the Act
and exceeds what the Act intended — to grant
incentives to recruitment/manning agencies.
“Section 10, in short, really operates to benefit
the wrong party and allows that party, without
justifiable reason, to mitigate its liability for
wrongful dismissals.” [Emphasis supplied]
RMC School of Law Laong Laan
ART. 12 – 42 et al.
“Because of this hidden twist, the limitation of
liability under Section 10 cannot be an
“appropriate” incentive.”
24. Same; Same; Same; View that the liability
limitation for wrongful dismissals of already
deployed Overseas Filipino Workers (OFWs)
is really part of a scheme to sell Filipino
overseas labor at a bargain for purposes
solely of attracting the market, a scheme that
sadly reduces our OFWs to mere cash cows.—
The chosen mode of granting the incentive, i.e.,
the liability limitation for wrongful dismissals of
already deployed OFWs, effectively imposed,
with legal sanction, a partial condonation of the
foreign principal/employer’s liability to OFWs.
The incentive, therefore, “from a more practical
and realistic view, is really part of a scheme to
sell Filipino overseas labor at a bargain for
purposes solely of attracting the market,” a
scheme that sadly reduces our OFWs to mere
cash cows.
25. Same; Same; Same; View that the “incentive
scheme” effectively benefits the
recruitment/manning agencies and foreign
principal/employer at the expense of the
Overseas Filipino Workers (OFWs) from
whom the salaries for the unexpired portion
of the contract are taken and to whom these
salaries rightfully belong.—The “incentive
scheme” effectively benefits the
recruitment/manning agencies and foreign
principal/employer at the expense of the OFWs
from whom the salaries for the unexpired portion
of the contract are taken and to whom these
salaries rightfully belong. In effect, “the
principals/employers and the
recruitment/manning agencies profit from their
violation of the security of tenure that an
employment contract embodies.” The OFWs, on
the other hand, are afforded lesser protection
because: (1) they are afforded reduced recovery
by operation of law; (2) the reduced recovery
renders wrongful dismissal situations more
alluring, easier to facilitate and less onerous to
undertake which foreign employers will most
certainly consider in termination of employment
decisions. These inimical effects obviously will
remain as long as the subject clause remains in
Section 10 of R.A. No. 8042, this time as
reinstated by R.A. No. 10022. The “inherently
oppressive, arbitrary, confiscatory and inimical
provision [under Section 10 of R.A. No. 8042
should, therefore,] be struck down for its conflict
with the substantive aspect of the constitutional
due process guarantee. Thus, I vote to declare as
unconstitutional the phrase “for three (3) months
25
LABOR LAW 1
for every year of the unexpired terms, whichever
is less” in the fifth and final paragraph of Section
10 of R.A. 8042.”
FACTS: Petitioner, Sameer Overseas Placement
Agency, Inc., is a recruitment and placement
agency. Respondent Joy Cabiles was hired thus
signed a one-year employment contractfor
a monthly salary of NT$15,360.00. 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 deductedNT$3,000 to cover her
plane ticket to Manila.
On October 15, 1997, Joy filed a
complaint for illegal dismissal with the NLRC
against petitioner and Wacoal. LA dismissed the
complaint. NLRC reversed LA’s decision. 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
ISSUE: Whether or not Cabiles was entitled to
the unexpired portion of her salary due to illegal
dismissal.
HELD: YES. 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.
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.
RMC School of Law
ART. 12 – 42 et al.
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.
Ruling on the constitutional issue
In the hierarchy of laws, the
Constitution is supreme. No branch or office of
the government may exercise its powers in any
manner inconsistent with the Constitution,
regardless of the existence of any law that
supports such exercise. The Constitution cannot
be trumped by any other law. All laws must be
read in light of the Constitution. Any law that is
inconsistent with it is a nullity.
Thus, when a law or a provision of
law is null because it is inconsistent with the
Constitution, the nullity cannot be cured by
reincorporation or reenactment of the same or
a similar law or provision. A law or provision
of law that was already declared unconstitutional
remains as such unless circumstances have so
changed as to warrant a reverse conclusion.
The Court observed that the reinstated
clause, this time as provided in Republic Act.
No. 10022, violates the constitutional rights to
equal protection and due process.96 Petitioner as
well as the Solicitor General have failed
to show any compelling change in the
circumstances that would warrant us to revisit
the precedent.
The Court declared, once again, the
clause, “or for three (3) months for every year of
the unexpired term, whichever is less” in Section
7 of Republic Act No. 10022 amending Section
10 of Republic Act No. 8042 is declared
unconstitutional and, therefore, null and void.
Dispositive Portion: WHEREFORE, the petition is
DENIED. The decision of the Court of Appeals is
AFFIRMED with modification. Petitioner Sameer
Overseas Placement Agency is ORDERED to pay
respondent Joy C. Cabiles the amount equivalent to
her salary for the unexpired portion of her
employment contract at an interest of 6% per annum
Laong Laan 26
LABOR LAW 1
from the finality of this judgment. Petitioner is also
ORDERED to reimburse respondent the withheld
NT$3,000.00 salary and pay respondent attorney’s
fees of NT$300.00 at an interest of 6% per annum
from the finality of this judgment. The clause, “or for
three (3) months for every year of the unexpired term,
whichever is less” in Section 7 of Republic Act No.
10022 amending Section 10 of Republic Act No. 8042
is declared unconstitutional and, therefore, null and
void.
Serrano vs. Gallant Maritime Services,
3.
Inc. (G.R. No. 167614, March 24, 2009)
1. Constitutional Law; Non-impairment of
Contracts; The non-impairment clause under
Section 10, Article II of the Constitution is
limited in application to laws about to be
enacted that would in any way derogate from
existing acts or contracts by enlarging,
abridging or in any manner changing the
intention of the parties thereto.-—The
prohibition is aligned with the general principle
that laws newly enacted have only a prospective
operation, and cannot affect acts or contracts
already perfected; however, as to laws already in
existence, their provisions are read into contracts
and deemed a part thereof. Thus, the non-
impairment clause under Section 10, Article II is
limited in application to laws about to be enacted
that would in any way derogate from existing
acts or contracts by enlarging, abridging or in
any manner changing the intention of the parties 4.
thereto.
2. Same; Same; Same; View that the expansion
of the Philippine overseas development
program and the need for incentives to
achieve results are simply not valid reasons to
justify a classification, particularly when the
incentive is in the form of oppressive and
confiscatory limitation of liability detrimental
to labor. No valid basis for classification thus
exists to justify the differential treatment that
resulted from the disputed Section 10.-—The
OSG could not even point to any reason other
than the protection of recruitment agencies and
the expansion of the Philippine overseas program
as justification for the limitation of liability that
has effectively distinguished OFWs from 5.
locally-based workers. These reasons,
unfortunately, are not on the same plane as
protection to labor in our constitutional hierarchy
of values. Even RA 8042 repeats that “the State
does not promote overseas employment as a
means to sustain economic growth and national
RMC School of Law Laong Laan
ART. 12 – 42 et al.
development.” Under RA 8042’s own terms, the
overseas employment program exists only for
OFW protection. Thus viewed, the expansion of
the Philippine overseas deployment program and
the need for incentives to achieve results are
simply not valid reasons to justify a
classification, particularly when the incentive is
in the form of oppressive and confiscatory
limitation of liability detrimental to labor. No
valid basis for classification thus exists to justify
the differential treatment that resulted from the
disputed Section 10.
Same; Same; Same; View that the difference
in work locations and working conditions that
the Office of the Solicitor General (OSG)
pointed out are not valid grounds for
distinctions that should matter in the
enforcement of employment contracts.-—The
difference in work locations and working
conditions that the OSG pointed out are notvalid
grounds for distinctions that should matter in the
enforcement of employment contracts. Whether
in the Philippines or elsewhere, the integrity of
contracts—be they labor, commercial or
political—is a zealously guarded value that we in
the Philippines should not demean by allowing a
breach of OFW contracts easy to undertake. This
is true whatever may be the duration or character
of employment; employment contracts, whatever
their term and conditions may be subject only to
their consistency with the law, must be respected
during the whole contracted term and under the
conditions agreed upon.
Same; Same; Same; View that the disputed
portion of Section 10 is one that goes against
the interests of labor, based on R.A. No.
8042’s own declared purposes and, more
importantly, on constitutional standards,
Section 10 diminished rather than enhanced
the protection the Constitution envisions for
Overseas Filipino Workers (OFWs).-—The
situation of illegally dismissed OFWs changed
for the worse after R.A. No. 8042. In this sense,
the disputed portion of Section 10 is one that
goes against the interests of labor, based on R.A.
No. 8042’s own declared purposes and, more
importantly, on constitutional standards. Section
10 diminished rather than enhanced the
protection the Constitution envisions for OFWs.
Constitutional Law; Labor Law; Due
Process; View that the provision should be
struck down for violations of the
constitutional provisions in favor of labor and
of the substantive aspect of the due process
clause.-—My conclusion, however, proceeds
from a different reason and constitutional basis. I
27
LABOR LAW 1
believe that this provision should be struck down
for violations of the constitutional provisions in
favor of labor and of the substantive aspect of the
due process clause. Given these bases, I see no
necessity in invoking the equal protection clause.
Underlying this restraint in invoking the equal
protection clause is my hesitation to join the
ponencia in declaring a classification as
“suspect” and in using the strict scrutiny
standard without clearly defined parameters on
when this approach applies.
6. Same; Same; Same; The assailed provision is
unduly oppressive, unreasonable, and
repugnant to the Constitution. It undermines
the mandate of the Constitution to protect the
rights of overseas workers and to promote
their welfare.-—The assailed provision is
unduly oppressive, unreasonable, and repugnant
to the Constitution. It undermines the mandate of
the Constitution to protect the rights of overseas
workers and to promote their welfare. Section 3,
Article XIII, of the Constitution states that the
State shall (1) afford full protection to overseas
labor, (2) promote full employment and equality
of employment opportunities for all, and (3)
guarantee the rights of all workers to security of
tenure, humane conditions of work, and a living
wage. Section 18, Article II, of the Constitution
states that, “The State affirms labor as a primary
social economic force. It shall protect the rights
of workers and promote their welfare.”
7. Same; Same; Same; The exercise of police
power, to be valid, must be reasonable and
not repugnant to the Constitution.-—The
exercise of police power, to be valid, must be
reasonable and not repugnant to the Constitution.
In Philippine Association of Service Exporters,
Inc. v. Drilon, 163 SCRA 386 (1988), the Court
held that: Notwithstanding its extensive sweep,
police power is not without its own limitations.
For all its awesome consequences, it may not be
exercised arbitrarily or unreasonably. Otherwise,
and in that event, it defeats the purpose for which
it is exercised, that is, to advance the public
good.
8. Same; Same; Same; Substantive due process
requires that the means employed in
depriving persons of property must not be
unduly oppressive.-—The right to property is
not absolute—the prohibition against deprivation
of property is qualified by the phrase “without
due process of law.” Thus, the State may deprive
persons of property through the exercise of
police power. However, the deprivation must be
done with due process. Substantive due process
requires that the means employed in depriving
RMC School of Law Laong Laan
ART. 12 – 42 et al.
persons of property must not be unduly
oppressive.
9. Same; Same; Same; Right to Work; The right
to work and the right to earn a living
necessarily includes the right to bargain for
better terms in an employment contract and
the right to enforce those terms.-—The right to
work and the right to earn a living necessarily
includes the right to bargain for better terms in
an employment contract and the right to enforce
those terms. If protected property does not
include these rights, then the right to work and
the right to earn a living would become empty
civil liberties—the State can deprive persons of
their right to work and their right to earn a living
by depriving them of the right to negotiate for
better terms and the right to enforce those terms.
10. Constitutional Law; Labor Law; Due
Process; Right to Property; View that the
provision “or for three (3) months for every
year of the unexpired term, whichever is less”
in Section 10, paragraph 5, of Republic Act
(RA) No. 8042 is unconstitutional-—it violates
the prohibition against deprivation of property
without due process of law.—I concur that the
provision “or for three (3) months for every year
of the unexpired term, whichever is less” in
Section 10, paragraph 5, of Republic Act (RA)
No. 8042 is unconstitutional, but on a
differentground. The provision violates the
prohibition against deprivation of property
without due process of law. It is an invalid
exercise of police power
11. Same; Same; Same; The subject clause being
unconstitutional, petitioner is entitled to his
salaries for the entire enexpired period of nine
months and 23 days of his employment
contract, pursuant to law and jurisprudence
prior to the enactment of Republic Act (RA)
8042.-—The subject clause does not state or
imply any definitive governmental purpose; and
it is for that precise reason that the clause
violates not just petitioner’s right to equal
protection, but also her right to substantive due
process under Section 1, Article III of the
Constitution. The subject clause being
unconstitutional, petitioner is entitled to his
salaries for the entire unexpired period of nine
months and 23 days of his employment contract,
pursuant to law and jurisprudence prior to the
enactment of R.A. No. 8042.
12. Same; Same; Same; The Supreme Court
further holds that the subject clause violates
petitioner’s right to substantive due process,
for it deprives him of property, consisting of
monetary benefits, without any existing valid
28
LABOR LAW 1
governmental purpose.-—The view that the
concepts of suspect classification and strict
judicial scrutiny formulated in Central Bank
Employee Association exaggerate the
significance of Section 3, Article XIII is a
groundless apprehension. Central Bank applied
Article XIII in conjunction with the equal
protection clause. Article XIII, by itself, without
the application of the equal protection clause, has
no life or force of its own as elucidated in
Agabon. Along the same line of reasoning, the
Court further holds that the subject clause
violates petitioner’s right to substantive due
process, for it deprives him of property,
consisting of monetary benefits, without any
existing valid governmental purpose.
13. Same; Same; Same; Section 3, Article XIII of
the Constitution does not directly bestow on
the working class any actual enforceable
right, but merely clothes it with the status of a
sector for whom the Constitution urges
protection through executive or legislative
action and judicial recognition; Its utility is
best limited to being an impetus not just for
the executive and legislative departments, but
for the judiciary as well, to protect the welfare
of the working class.-—It must be stressed that
Section 3, Article XIII does not directly bestow
on the working class any actual enforceable
right, but merely clothes it with the status of a
sector for whom the Constitution urges
protection through executive or legislative action
and judicial recognition. Its utility is best limited
to being an impetus not just for the executive and
legislative departments, but for the judiciary as
well, to protect the welfare of the working class.
And it was in fact consistent with that
constitutional agenda that the Court in Central
Bank (now Bangko Sentral ng Pilipinas)
Employee Association, Inc. v. Bangko Sentral ng
Pilipinas, 446 SCRA 299 (2004), penned by then
Associate Justice now Chief Justice Reynato S.
Puno, formulated the judicial precept that when
the challenge to a statute is premised on the
perpetuation of prejudice against persons favored
by the Constitution with special protection—
such as the working class or a section thereof—
the Court may recognize the existence of a
suspect classification and subject the same to
strict judicial scrutiny.
14. Same; Same; Same; While all the provisions
of the 1987 Constitution are presumed self-
executing, there are some which this Court
has declared not judicially enforceable,
Article XIII, being one.-—While all the
provisions of the 1987 Constitution are presumed
RMC School of Law
ART. 12 – 42 et al.
self-executing, there are some which this Court
has declared not judicially enforceable, Article
XIII being one, particularly Section 3 thereof, the
nature of which, this Court, in Agabon v.
National Labor Relations Commission, 442
SCRA 573 (2004), has described to be not self-
actuating: Thus, the constitutional mandates of
protection to labor and security of tenure may be
deemed as self-executing in the sense that these
are automatically acknowledged and observed
without need for any enabling legislation.
However, to declare that the constitutional
provisions are enough to guarantee the full
exercise of the rights embodied therein, and the
realization of ideals therein expressed, would be
impractical, if not unrealistic. The espousal of
such view presents the dangerous tendency of
being overbroad and exaggerated. The
guarantees of “full protection to labor” and
“security of tenure,” when examined in isolation,
are facially unqualified, and the broadest
interpretation possible suggests a blanket shield
in favor of labor against any form of removal
regardless of circumstance. This interpretation
implies an unimpeachable right to continued
employment—a utopian notion, doubtless—but
still hardly within the contemplation of the
framers. Subsequent legislation is still needed to
define the parameters of these guaranteed rights
to ensure the protection and promotion, not only
the rights of the labor sector, but of the
employers’ as well. Without specific and
pertinent legislation, judicial bodies will be at a
loss, formulating their own conclusion to
approximate at least the aims of the Constitution.
15. Same; Same; Same; The Supreme Court
concludes that the subject clause contains a
suspect classification in that, in the
computation of the monetary benefits of fixed-
term employees who are illegally discharged,
it imposes a 3-month cap on the claim of
Overseas Filipino Workers (OFWs), with an
unexpired portion of one year or more in their
contracts, but none on the claims of other
OFWs or local workers with fixed-term
employment. The subject clause singles out
one classification of Overseas Filipino
Workers (OFWs), and burdens it with a
peculiar disadvantage.-—The Court concludes
that the subject clause contains a suspect
classification in that, in the computation of the
monetary benefits of fixed-term employees who
are illegally discharged, it imposes a 3-month
cap on the claim of OFWs with an unexpired
portion of one year or more in their contracts, but
none on the claims of other OFWs or local
Laong Laan 29
LABOR LAW 1
workers with fixed-term employment. The
subject clause singles out one classification of
OFWs and burdens it with a peculiar
disadvantage. 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.
16. Same; Same; Same; With the enactment of
Republic Act 8042, specifically the adoption of
the subject clause, illegally dismissed
Overseas Filipino Workers (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.-—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 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.
17. Same; Same; Republic Act No. 8042; Prior to
Republic Act 8042, all Overseas Filipino
workers (OFWs), regardless of contract
periods or the unexpired portions thereof,
were treated alike in terms of the computation
of their monetary benefits in case of illegal
dismissal. Their claims were subjected to a
uniform rule of computation: their basic
salaries multiplied by the entire unexpired
portion of their employment contracts.-—It is
plain that prior to R.A. No. 8042, all Overseas
Filipino workers (OFWs), regardless of contract
periods or the unexpired portions thereof, were
treated alike in terms of the computation of their
monetary benefits in case of illegal dismissal.
Their claims were subjected to a uniform rule of
computation: their basic salaries multiplied by
the entire unexpired portion of their employment
contracts. The enactment of the subject clause in
R.A. No. 8042 introduced a differentiated rule of
computation of the money claims of illegally
dismissed OFWs based on their employment
RMC School of Law Laong Laan
ART. 12 – 42 et al.
periods, in the process singling out one category
whose contracts have an unexpired portion of
one year or more and subjecting them to the
peculiar disadvantage of having their monetary
awards limited to their salaries for 3 months or
for the unexpired portion thereof, whichever is
less, but all the while sparing the other category
from such prejudice, simply because the latter’s
unexpired contracts fall short of one year.
18. Same; Labor Law; Section 18, Article II and
Section 3, Article XIII accord all members of
the labor sector, without distinction as to
place of deployment, full protection of their
rights and welfare.-—Section 18, Article II and
Section 3, 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.
19. Same; Same; Police Power; Police power
legislations adopted by the State to promote
the health, morals, peace, education, good
order, safety, and general welfare of the
people are generally applicable not only to the
future contracts but even to those already in
existence, for all private contracts must yield
to the superior and legitimate measures taken
by the State to promote public welfare.-—But
even if the Court were to disregard the timeline,
the subject clause may not be declared
unconstitutional on the ground that it impinges
on the impairment clause, for the law was
enacted in the exercise of the police power of the
State to regulate a business, profession or
calling, particularly the recruitment and
deployment of OFWs, with the noble end in
view of ensuring respect for the dignity and well-
being of OFWs wherever they may be employed.
Police power legislations adopted by the State to
promote the health, morals, peace, education,
good order, safety, and general welfare of the
people are generally applicable not only to future
contracts but even to those already in existence,
for all private contracts must yield to the superior
and legitimate measures taken by the State to
promote public welfare.
30
LABOR LAW 1
FACTS: Petitioner was hired by Gallant
Maritime Services, Inc. and Marlow Navigation
Co., Ltd. (respondents) under a POEA-approved
Contract of Employment. On March 19, 1998,
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. However, respondents did not deliver on
their promise to make petitioner Chief
Officer. Hence, petitioner refused to stay on as
Second Officer and was repatriated to
the Philippines on May.
Petitioner's employment contract was
for a period of 12 months or from March 19,
1998 up to March 19, 1999, but at the time of his
repatriation on May 26, 1998, he had served
only two (2) months and seven (7) days of his
contract, leaving an unexpired portion of nine
(9) months and twenty-three (23) days.
Petitioner filed with the Labor Arbiter
(LA) a Complaint against respondents for
constructive dismissal and for payment of his
money claims. LA rendered the dismissal of
petitioner illegal and awarding him monetary
benefits. Respondents appealed to the NLRC to
question the finding of the LA. Likewise,
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.
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. Petitioner
filed a Motion for Partial Reconsideration; he
questioned the constitutionality of the subject
clause. Petitioner filed a Petition for Certiorari
with the CA, reiterating the constitutional
challenge against the subject clause. CA
affirmed the NLRC ruling on the reduction of
the applicable salary rate; however, the CA
RMC School of Law Laong Laan
ART. 12 – 42 et al.
skirted the constitutional issue raised by
petitioner.
The last clause in the 5th paragraph of
Section 10, Republic Act (R.A.) No. 8042, to
wit:
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.
Applying the subject clause, the NLRC
and the CA computed the lump-sum salary of
petitioner at the monthly rate of US$1,400.00
covering the period of three months out of the
unexpired portion of nine months and 23 days of
his employment contract or a total of
US$4,200.00.
Impugning the constitutionality of the
subject clause, petitioner contends that, in
addition to the US$4,200.00 awarded by the
NLRC and the CA, he is entitled to
US$21,182.23 more or a total of US$25,382.23,
equivalent to his salaries for the entire nine
months and 23 days left of his employment
contract, computed at the monthly rate of
US$2,590.00
ISSUE: Is petitioner entitled to his monetary
claim which is the lump-sum salary for the
entire unexpired portion of his 12-month
employment contract, and not just for a period of
three months?
Should petitioner’s overtime and leave
pay form part of the salary basis in the
computation of his monetary award, because
these are fixed benefits that have been stipulated
into his contract?
HELD: 1.) Yes. 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. The subject clause “or
for three months for every year of the unexpired
term, whichever is less” in the 5th paragraph of
31
LABOR LAW 1
Section 10 of Republic Act No. 8042
is declared unconstitutional.
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
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.
The Court concludes that the subject
clause contains a suspect classification in that,
in the computation of the monetary benefits of
fixed-term employees who are illegally
discharged, it imposes a 3-month cap on the
claim of OFWs with an unexpired portion of
one year or more in their contracts, but none
on the claims of other OFWs or local workers
with fixed-term employment. The subject
clause singles out one classification of OFWs
and burdens it with a peculiar disadvantage.
The Court further holds that the subject
clause violates petitioner's right to substantive
due process, for it deprives him of property,
consisting of monetary benefits, without any
existing valid governmental purpose. The
subject clause being unconstitutional, petitioner
is entitled to his salaries for the entire unexpired
period of nine months and 23 days of his
employment contract, pursuant to law and
jurisprudence prior to the enactment of R.A. No.
8042.
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.
RMC School of Law
ART. 12 – 42 et al.
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.
Dispositive Portion: 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 the December 8, 2004
Decision and April 1, 2005 Resolution of the Court of
Appeals are MODIFIED to the effect 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. No costs.
Chavez vs. Bonto-Perez (G.R. No. 109808,
March 01, 1995)
1. Labor Law; Court holds that the managerial
commission agreement executed by petitioner
to authorize her Japanese employer to deduct
Two Hundred Fifty U.S. Dollars from her
monthly basic salary is void because it is
against our existing laws, morals and public
policy.—Firstly, we hold that the managerial
commission agreement executed by petitioner to
authorize her Japanese employer to deduct Two
Hundred Fifty U.S. Dollars (US$250.00) from
her monthly basic salary is void because it is
against our existing laws, morals and public
policy. It cannot supersede the standard
employment contract of December 1, 1988
approved by the POEA with the following
stipulation appended thereto: “It is understood
that the terms and conditions stated in this
Employment Contract are in conformance with
the Standard Employment Contract for
Entertainers prescribed by the POEA under
Memorandum Circular No. 2, Series of
1986. Any alterations or changes made in any
part of this contract without prior approval by
the POEA shall be null and void”; (Emphasis
supplied.)
2. Same; The basic salary of One Thousand Five
Hundred U.S. Dollars guaranteed to
petitioner under the parties’ standard
employment contract is in accordance with
the minimum employment standards with
respect to wages set by the POEA.—Clearly,
Laong Laan 32
LABOR LAW 1
the basic salary of One Thousand Five Hundred
U.S. Dollars (US$1,500.00) guaranteed to
petitioner under the parties’ standard
employment contract is in accordance with
the minimum employment standards with respect
to wages set by the POEA. Thus, the side
agreement which reduced petitioner’s basic wage
to Seven Hundred Fifty U.S. Dollars
(US$750.00) is null and void for violating the
POEA’s minimum employment standards, and
for not having been approved by the POEA.
Indeed, this side agreement is a scheme all too
frequently resorted to by unscrupulous
employers against our helpless overseas workers
who are compelled to agree to satisfy their basic
economic needs.
3. Civil Law; Laches; Definition of Laches.—
Laches has been defined as the failure or neglect
for an unreasonable and unexplained length of
time to do that which, by exercising due
diligence, could or should have been done
earlier, thus giving rise to a presumption that the
party entitled to assert it either has abandoned or
declined to assert it. It is not concerned with
mere lapse of time; the fact of delay, standing
alone, is insufficient to constitute laches.
4. Same; Same; There is no absolute rule as to
what constitutes laches.—The doctrine of
laches is based upon grounds of public policy
which requires, for the peace of society, the
discouragement of stale claims, and is principally
a question of the inequity or unfairness of
permitting a right or claim to be enforced or
asserted. There is no absolute rule as to what
constitutes laches; each case is to be determined
according to its particular circumstances. The
question of laches is addressed to the sound
discretion of the court, and since it is an
equitable doctrine, its application is controlled
by equitable considerations. It cannot be worked
to defeat justice or to perpetrate fraud and
injustice.
5. Same; Same; Court holds that the doctrine of
laches is inapplicable to petitioner.—In the
case at bench, petitioner filed her claim well
within the three-year prescriptive period for the
filing of money claims set forth in Article 291 of
the Labor Code. For this reason, we hold the
doctrine of laches inapplicable to petitioner.
FACTS: Chavez is a dancer who was contracted
by Centrum Placement & Promotions
Corporation to perform in Japan for 6 months.
The contract was for $1.5k a month, which was
approved by POEA. After the approval of said
RMC School of Law Laong Laan
ART. 12 – 42 et al.
contract, Chavez entered into a side contract
reducing her salary with her Japanese employer
through her local manager-agency (Jaz Talents
Promotion). The salary was reduced to $500 and
$750 was to go to Jaz Talents. In February 1991
(two years after the expiration of her contract),
Chavez sued Centrum Placement and Jaz
Talents for underpayment of wages before the
POEA.
The POEA ruled against her. POEA stated that
the side agreement entered into by Chavez with
her Japanese employer superseded the Standard
Employment Contract; that POEA had no
knowledge of such side agreement being entered
into; that Chavez is barred by laches for sleeping
on her right for two years.
ISSUE: Whether or not Chavez is entitled to
relief.
HELD: Yes. The SC ruled that the managerial
commission agreement executed by Chavez to
authorize her Japanese Employer to deduct her
salary is void because it is against our existing
laws, morals and public policy. It cannot
supersede the standard employment contract
approved by the POEA with the following
stipulation appended thereto:
It is understood that the terms and
conditions stated in this Employment Contract
are in conformance with the Standard
Employment Contract for Entertainers
prescribed by the POEA under Memorandum
Circular No. 2, Series of 1986. Any alterations
or changes made in any part of this contract
without prior approval by the POEA shall be
null and void;
The side agreement which reduced
Chavez’s basic wage is null and void for
violating the POEA’s minimum employment
standards, and for not having been approved by
the POEA. Here, both Centrum Placement and
Jaz Talents are solidarily liable.
Laches does not apply in the case at bar.
In this case, Chavez filed her claim well within
the three-year prescriptive period for the filing
of money claims set forth in Article 291 of the
Labor Code. For this reason, laches is not
applicable.
33
LABOR LAW 1
Dispositive Portion: IN VIEW WHEREOF, the
petition is GRANTED. The Decisions of respondent
POEA Administrator and NLRC Commissioners in
POEA Case No. Adj. 91-02-199 (ER), respectively
dated February 17 and December 29, 1992, and the
Resolution of the NLRC, dated March 23, 1993, are
REVERSED and SET ASIDE. Private respondents
are held jointly and severally liable to petitioner for
the payment of SIX THOUSAND US DOLLARS
(US$6,000.00) in unpaid wages. Costs against
private respondents.
Sunace International Management Services,
Inc. vs. National Labor Relations
Commission (G.R. No. 161757, January 25,
2006)
1. Civil Law; Contracts; 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 finding of the Court of
Appeals solely on the basis of the above-
quoted telefax message, that Sunace
continually communicated with the foreign
“principal” (sic) 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.
2. Civil Law; Contracts; The theory of
imputed knowledge ascribes the
knowledge of the agent, Sunace, to the
principal, employer Xiong, not the other
way around.-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.
FACTS: Petitioner, Sunace International
Management Services deployed to Taiwan
Divina A. Montehermozo as a domestic helper
RMC School of Law
ART. 12 – 42 et al.
under a 12-month contract. The deployment was
with the assistance of a Taiwanese broker,
Edmund Wang, President of Jet Crown
International Co., Ltd. After her 12-month
contract expired, Divina continued working for
her Taiwanese employer, Hang Rui Xiong, for
two more years, after which she returned to the
Philippines. 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.
Labor Arbitration Associate Regina T. Gavin
issued Summons to the Manager of Sunace.
Divina was claiming the refund of the deduction
for income tax and savings under the one-year
and 2-year extended contract. Sunace says she
was not entitled to refund for 24 months savings
because employer did not deduct any from her
salary from there. There is also no basis for her
claim of tax refund because as the she finished
her one year contract and hence, was not
illegally dismissed by her employer. Sunace then
filed an answer 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, copy of each document was annexed
to said ". . . answer to complainant’s position
paper." The Labor Arbiter rejected Sunace’s
claim that the extension of Divina’s contract for
two more years was without its knowledge.
Labor Arbiter also says that any agreement for
settlement should be reduced to writing and
signed by parties and counsel before Labor
Arbiter. It was held that Sunace and its owner,
Perge, both in their personal capacities and as an
agent of Hang Rui Xiong should jointly and
severally pay Divina.
ISSUE: Whether or not Sunace is liable as an
agent of Hong Rui Xiong
HELD: No, Sunace and its owner cannot be
held liable for Divina as there was an implied
revocation of its agency relationship with its
foreign principal. Under Article 1924 of the
New Civil Code, 'The agency is revoked if the
Laong Laan 34
LABOR LAW 1
principal directly manages the business entrusted
to the agent, dealing directly with third persons'.
In the present case, after the termination of the 3.
original employment contract, the foreign
principal directly negotiated with Divina and
entered into a new and separate employment
contract in Taiwan. Thus, making Sunace no
longer liable to Divina.
Dispositive Portion: WHEREFORE, the petition is
GRANTED. The challenged resolutions of the Court
of Appeals are hereby REVERSED and SET ASIDE.
The complaint of respondent Divina A.
Montehermozo against petitioner is DISMISSED.
Dagasdas v. Grand Placement (G.R. No.
205727, January 18, 2017)
4.
1. Same; Quitclaims; Generally, the employee’s
waiver or quitclaim cannot prevent the
employee from demanding benefits to which
he or she is entitled, and from filing an illegal
dismissal case.-—Generally, the employee’s
waiver or quitclaim cannot prevent the employee
from demanding benefits to which he or she is
entitled, and from filing an illegal dismissal case.
This is because waiver or quitclaim is looked
upon with disfavor, and is frowned upon for
being contrary to public policy. Unless it can be
established that the person executing the waiver
voluntarily did so, with full understanding of its
contents, and with reasonable and credible
consideration, the same is not a valid and
binding undertaking. Moreover, the burden to
prove that the waiver or quitclaim was
voluntarily executed is with the employer.
2. Remedial Law; Civil Procedure; Appeals;
Petition for Review on Certiorari; As a rule,
only questions of law may be raised in a
petition under Rule 45 of the Rules of Court.
However, this rule allows certain exceptions,
including a situation where the findings of
fact of the courts or tribunals below are
conflicting.-—As a rule, only questions of law
may be raised in a petition under Rule 45 of the
Rules of Court. However, this rule allows certain 5.
exceptions, including a situation where the
findings of fact of the courts or tribunals below
are conflicting. In this case, the CA and the
NLRC arrived at divergent factual findings anent
Dagasdas’ termination. As such, the Court deems
it necessary to reexamine these findings and
determine whether the CA has sufficient basis to
annul the NLRC Decision, and set aside its
RMC School of Law Laong Laan
ART. 12 – 42 et al.
finding that Dagasdas was illegally dismissed
from work.
Labor Law; Management Prerogative; It is
well-settled that employers have the
prerogative to impose standards on the work
quantity and quality of their employees and
provide measures to ensure compliance
therewith.-—It is well-settled that employers
have the prerogative to impose standards on the
work quantity and quality of their employees and
provide measures to ensure compliance
therewith. Noncompliance with work standards
may thus be a valid cause for dismissing an
employee. Nonetheless, to ensure that employers
will not abuse their prerogatives, the same is
tempered by security of tenure whereby the
employees are guaranteed substantive and
procedural due process before they are dismissed
from work.
Same; Security of Tenure; Lex Loci
Contractus; Since the employment contracts
of Overseas Filipino Workers (OFWs) are
perfected in the Philippines, and following the
principle of lex loci contractus (the law of the
place where the contract is made), these
contracts are governed by our laws, primarily
the Labor Code of the Philippines and its
implementing rules and regulations (IRR);
Thus, even if a Filipino is employed abroad,
he or she is entitled to security of tenure,
among other constitutional rights.-—Security
of tenure remains even if employees, particularly
the Overseas Filipino Workers (OFWs), work in
a different jurisdiction. Since the employment
contracts of OFWs are perfected in the
Philippines, and following the principle of lex
loci contractus (the law of the place where the
contract is made), these contracts are governed
by our laws, primarily the Labor Code of the
Philippines and its implementing rules and
regulations. At the same time, our laws generally
apply even to employment contracts of OFWs as
our Constitution explicitly provides that the State
shall afford full protection to labor, whether local
or overseas. Thus, even if a Filipino is employed
abroad, he or she is entitled to security of tenure,
among other constitutional rights.
Same; Probationary Employees; 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.-—Even
assuming that Dagasdas was still a probationary
employee when he was terminated, his dismissal
35
LABOR LAW 1
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. Here, ITM
failed to prove that it informed Dagasdas of any
predetermined standards from which his work
will be gauged. In the contract he signed while
still in the Philippines, Dagasdas was employed
as Network Technician; on the other hand, his
new contract indicated that he was employed as
Superintendent. However, no job description —
or such duties and responsibilities attached to
either position — was adduced in evidence. It
thus means that the job for which Dagasdas was
hired was not definite from the beginning.
Indeed, Dagasdas was not sufficiently informed
of the work standards for which his performance
will be measured. Even his position based on the
job title given him was not fully explained by his
employer. Simply put, ITM failed to show that it
set and communicated work standards for
Dagasdas to follow, and on which his efficiency
(or the lack thereof) may be determined.
6. Same; Employment Contracts; Overseas
Filipino Workers; Unless the employment
contract of an Overseas Filipino Worker
(OFW) is processed through the Philippine
Overseas Employment Administration
(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.-—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.
7. Same; Termination of Employment; Overseas
Filipino Workers; 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.-—A valid dismissal requires substantive
and procedural due process. As regards the latter,
RMC School of Law
ART. 12 – 42 et al.
the employer must give the concerned employee
at least two notices before his or her termination.
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. In fact, it appears that ITM intended
not to comply with the twin notice requirement.
As above quoted, under the new contract, ITM
reserved in its favor the right to terminate the
contract without serving any notice to Dagasdas
in specified cases, which included such situation
where the employer decides to dismiss the
employee within the probationary period.
Without doubt, ITM violated the due process
requirement in dismissing an employee.
FACTS: Grand Placement, a licensed
recruitment agency, employed Dagasdas as a
network technician on behalf of Industrial
Management Technology Methods (ITM),
whereby he is to be deployed to in Saudi Arabia
under a 1-year contract. Dagasdas contended
that while the contract specified that he was
employed as a network technician, he was
actually engaged as a civil engineer and said
former position was only for the purpose of
securing a visa. When he arrived in Saudi
Arabia, he signed a new employment contract
with ITM which stipulated that the latter
contracted him as a Superintendent and he was
placed under a 3-month probationary period. He
reported to the worksite but was given tasks
suited for a Mechanical Engineer which were
foreign to the job applied for. He was then
temporarily given the position of Civil
Construction Engineer. ITM gave him a
termination notice indicating that 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. Thus, he returned to the
PH and filed a case for illegal dismissal.
ISSUE: Whether or not Dagasdas was validly
dismissed from work?
Laong Laan 36
LABOR LAW 1
HELD: No, Dagasdas was not validly
dismissed. Security of tenure remains even if
employees, particularly OFWs, work in a
different jurisdiction. Thus, even if a Filipino is
employed abroad, he or she is entitled to security
of tenure. In this case, prior to his deployment
and while still in the PH, Dagasdas was made to
sign a POEA-approved contract with GPGS, on
behalf of ITM; and, upon arrival in Saudi
Arabia, ITM made him sign a new employment
contract. Nonetheless, this new contract, which
was used as basis for dismissing Dagasdas, is
void for being in violation of his right to security
of tenure. Article 297 of the Labor Code
provides for the just causes for dismissing an
employee but ITM terminated Dagasdas for
violating a clause in the new contract. The
clause is contrary to law because to allow
employers to reserve a right to terminate
employees without cause is violative of the
guarantee of security of tenure. Moreover, even
if Dagasdas was a probationary employee, his
termination must still be with a valid clause.
Furthermore, the new contract was not shown to
have been processed through the POEA. It also
breached Dagasdas' original contract as it was
entered into even before the expiration of the
original contract approved by the POEA.
Dispositive Portion: WHEREFORE, the Petition is
GRANTED. The Decision dated September 26, 2012
and Resolution dated January 28, 2013 of the Court
of Appeals in C.A.-G.R. S.P. No. 115396 are
REVERSED and SET ASIDE. Accordingly, the
March 29, 2010 and June 2, 2010 Resolutions of the
National Labor Relations Commission in NLRC LAC
OFW-L-02-000071-10 are REINSTATED.
NFD International Manning Agents v. NLRC
(G.R. No. 116629, January 16, 1998)
1. Labor Law; Appeals; National Labor
Relations Commission; Evidence; The
submission of additional evidence before
the NLRC is not prohibited by the New
Rules of Procedure of the NLRC, such
submission not being prejudicial to the
other party for the latter could submit
counter-evidence.-The submission of
additional evidence before the respondent
Commission is not prohibited by the New
Rules of Procedure of the NLRC. After all,
RMC School of Law
ART. 12 – 42 et al.
rules of evidence prevailing in courts of law
or equity are not controlling in labor cases.
The NLRC and labor arbiters are directed to
use every and all reasonable means to
ascertain the facts in each case speedily and
objectively, without regard to technicalities
of law and procedure all in the interest of
substantial justice. In keeping with this
directive, it has been held that the NLRC
may consider evidence, such as documents
and affidavits, submitted by the parties for
the first time on appeal. The submission of
additional evidence on appeal does not
prejudice the other party for the latter could
submit counter-evidence.
2. Labor Law; Appeals; Due Process; It is
not the denial of the right to be heard but
denial of the opportunity to be heard that
constitutes violation of due process of
law.-The essence of due process is simply
an opportunity to be heard, or as applied to
administrative proceedings, a fair and
reasonable opportunity to explain one’s side.
It is also an opportunity to seek a
reconsideration of the action or ruling
complained of. It is not the denial of the
right to be heard but denial of the
opportunity to be heard that constitutes
violation of due process of law.
3. Labor Law; Seamen; The death of a
seaman during the term of his
employment makes the employer liable to
the former’s heirs for death compensation
benefits unless the employer can
successfully prove that the seaman’s
death was caused by an injury directly
attributable to his deliberate or willful
act.-The death of a seaman during the term
of his employment makes the employer
liable to the former’s heirs for death
compensation benefits. The POEA Standard
Employment Contract fixes the amount at
U.S.$50,000.00 and an additional amount of
U.S.$7,000.00 for each child, not exceeding
four, under twenty-one years of age. The
employer becomes liable once it is
established that the seaman died during the
effectivity of his employment contract. This
rule, however, is not absolute. The employer
may be exempt from liability if he can
successfully prove that the seaman’s death
was caused by an injury directly attributable
to his deliberate or willful act.
4. Labor Law; Seamen; Evidence; The
testimonies of ship officers who merely
observed and narrated the circumstances
Laong Laan 37
LABOR LAW 1
surrounding the deaths of the two seamen
and the illness of another are insufficient
to prove the fact that the deaths were
caused by self-inflicted injuries.- The
testimonies of the officers are insufficient to
prove the fact that Misada’s and Envidiado’s
deaths were caused by self-inflicted injuries.
The testimonies were given by people who
merely observed and narrated the
circumstances surrounding the deaths of the
two seamen and the illness of Fajardo.
Fajardo himself did not submit any
testimony regarding the implantation. The
testimonies of the officers are, at best,
hearsay. Moreover, the officers did not have
the competence to make a medical finding
as to the actual cause of the deaths. No
autopsy report was presented to corroborate
their testimonies. On the contrary, Eduardo
Misada was medically diagnosed to have
died of “acute laryngo-trachea bronchitis
with pneumonia probably due to viral
cause.” This was declared in his “Cause of
Death Form” after his dead body was
examined on June 29, 1991 by Dr. Sydney
Prematirat, a Judicial Medical Officer at
Colombo, Sri Lanka.
5. Labor Law; Seamen; Evidence;
“Certificate for Removal of a Dead Body”
and “Certificate of Embalming” are not
proofs of the real cause of death.-Enrico
Envidiado was not issued a “Cause of Death
Form.” While still alive, he was examined in
Galle, Sri Lanka by Consultant Physician
Chandima de Mel who found a wound in his
penis and diagnosed his illness as “severe
tetanus.” His “Certificate for Removal of A
Dead Body” dated July 8, 1991 issued by
Dr. T.L. Seneviratne, Chief Medical Officer
of Health, Municipal Council, Colombo, Sri
Lanka, and “Certificate of Embalming”
dated July 8, 1991 issued by Keith Anthony
Raymond stated that Envidiado died of
“viral myocarditis—natural causes.” The
“Certificate for Removal of a Dead Body”
and “Certificate of Embalming” are not
proofs of the real cause of death. Their
probative value is confined only to the fact
of death. These documentary evidence,
however, did not at all indicate that
Envidiado died of tetanus as previously
diagnosed by Dr. de Mel. And despite Dr. de
Mel’s allegedly correct diagnosis, Envidiado
died a few days later.
RMC School of Law
ART. 12 – 42 et al.
FACTS: The private respondents (wives of the
two deceased husbands) filed for death
compensation benefits under the POEA Standard
Contract of employment before the petitioners
but were denied on the ground that the seaman’s
deaths were due to their own wilful act who
implanted fragments of reindeer horn in their
respective sexual organs that due to the lack of
sanitary conditions at the time and place of
implantation, all three seamen suffered "severe
tetanus" and "massive viral infections;" that
Misada and Envidiado died within days of the
other; that the third seaman, Arturo Fajardo,
narrowly missed death only because the vessel
was at port in Penang, Malaysia at the time the
tetanus became critical. Private respondents filed
separate complaints before the POEA
Adjudication Office. POEA Administrator
dismissed the case for lack of merit. Private
respondents appealed to respondent
Commission. During the pendency of the appeal,
private respondents submitted additional
documentary evidence in support of their
Memorandum on Appeal. Respondent
Commission reversed the POEA Administrator
and ordered petitioners to pay private
respondents. Hence this petition.
ISSUE: Whether respondent Commission
gravely erred in finding that the deaths of the
two seamen did not come as a result of their
wilful and deliberate act.
HELD: The SC dismissed the petition and
affirmed the decision of NLRC. According to
Part II, Section C, no. 6 of POEA “Standard
Employment Contract Governing the
Employment of All Filipino Seamen on Board
Ocean-Going Vessels” No compensation shall
be payable in respect of any injury, incapacity,
disability or death resulting from a willful act on
his own life by the seaman, provided, however,
that the employer can prove that such injury,
incapacity, disability or death is directly
attributable to him. In this case, the testimonies
of the officers are insufficient to prove the fact
that death of two seamen were caused by self-
inflicted injuries and in fact Fajardo, one who
did the same, did not submit any testimony
regarding the implantation. No autopsy report
was presented to corroborate their testimonies.
Laong Laan 38
LABOR LAW 1 ART. 12 – 42 et al.

Based on medical reports cause of death of

Misada was due to viral infection, while
Envidiado was due to viral myocarditis. Hence,
petitioner’s evidence insufficiently proves the
fact that the deaths of the two seamen were
caused by their own wilful and deliberate act.

Dispositive Portion: IN VIEW WHEREOF, the

petition is dismissed and the decision of respondent
National Labor Relations Commission in NLRC CA
No. 006490-94 is affirmed.

RMC School of Law Laong Laan 39