199072783 labor-case1

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MASING AND SONS DEVELOPMENT CORPORATION andCRISPIN CHAN,

Petitioners, - versus - GREGORIO P. ROGELIO, Respondent.

G.R. No. 161787 Present:

CORONA,C.J., Chairperson, LEONARDO-DE CASTRO, BERSAMIN, DEL CASTILLO, and VILLARAMA, JR., JJ.

Promulgated: April 27, 2011

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D E C I S I O N

BERSAMIN, J.: In any controversy between a laborer and his master, doubts reasonably arising from the evidence are resolved in favor of the laborer.

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We re-affirm this principle, as we uphold the decision of the Court of Appeals (CA) that reversed the uniform finding that there existed no employment relationship between the petitioners, as employers, and the respondent, as employee, made by the National Labor Relations Commission (NLRC) and the Labor Arbiter (LA).

Petitioners Masing and Sons Development Corporation (MSDC) and Crispin Chan assail the October 24, 2003 decision,[1] whereby the CA reversed the decision dated January 28, 2000 of the NLRC that affirmed the decision of the LA (dismissing the claim of the respondent for retirement benefits on the ground that he had not been employed by the petitioners but by another employer).

Antecedents

On May 19, 1997, respondent Gregorio P. Rogelio (Rogelio) brought against Chan a complaint for retirement pay pursuant to Republic Act No. 7641,[2] in relation to Article 287 of theLabor Code, holiday and rest days premium pay, service incentive leave, 13th month pay, cost of living allowances (COLA), underpayment of wages, and attorney’s fees. On January 20, 1998, Rogelio amended his complaint to include MSDC as a co-respondent. His version follows. Rogelio was first employed in 1949 by Pan Phil. Copra Dealer, MSDC’s predecessor, which engaged in the buying and selling of copra in Ibajay, Aklan, with its main office being in Kalibo, Aklan. Masing Chan owned and managed Pan Phil. Copra Dealer, and the Branch Manager in Ibajay was a certain So Na. In 1965, Masing Chan changed the business name of Pan Phil. Copra Dealer to Yao Mun Tek, and appointed Jose Conanan Yap Branch Manager in Ibajay. In the 1970s, the business name of Yao Mun Tek was changed to Aklan Lumber and General Merchandise, and Leon Chan became the Branch Manager in Ibajay. Finally, in 1984, Masing Chan adopted the business name of Masing and Sons Development Corporation (MSDC), appointing Wynne or Wayne Lim (Lim) as the Branch Manager in Ibajay. Crispin Chan replaced his father, Masing Chan, in 1990 as the manager of the entire business. In all that time, Rogelio worked as a laborer in the Ibajay Branch, along with twelve other employees. In January 1974, Rogelio was reported for Social Security System (SSS) coverage. After paying contributions to the SSS for more than 10 years, he became entitled to receive retirement benefits from the SSS. Thus, in 1991, he availed himself of the SSS retirement benefits, and in order to facilitate the grant of such benefits, he entered into an internal arrangement with Chan and MSDC to the effect that MSDC would issue a certification of his separation from employment notwithstanding that he would continue working as a laborer in the Ibajay Branch.

The certification reads as follows:[3]

CRISPIN AMIGO CHAN – COPRA DEALER

IBAJAY, AKLAN

August 10, 1991

CERTIFICATION OF SEPARATION FROM EMPLOYMENT To whom it may concern: This is to certify that my employee, GREGORIO P. ROGELIO bearing SSS ID No. 07-0495213-7 who was first covered effective January, 1974 up to June 30, 1989 inclusive, is now officially separated from my employ effective the 1st of July, 1989. Please be guided accordingly. (SGD.) CRISPIN AMIGO CHANProprietorSSS ID No. 07-0595800-4

On March 17, 1997, Rogelio was paid his last salary. Lim, then the Ibajay Branch Manager, informed Rogelio that he was deemed retired as of that date. Chan confirmed to Rogelio that he had already reached the compulsory retirement age when he went to the main office in Kalibo to verify his status. Rogelio was then 67 years old.

Considering that Rogelio was supposedly receiving a daily salary of P70.00 until 1997, but did not receive any 13th month pay, service incentive leave, premium pay for holidays and rest days and COLA, and even any retirement benefit from MSDC upon his retirement in March 1997, he commenced his claim for such pay and benefits. In substantiation, Rogelio submitted the January 19, 1998 affidavits of his co-workers, namely: Domingo Guevarra, [4] Juanito Palomata,[5] and Ambrosio Señeres,[6] whereby they each declared under oath that Rogelio had already been working at the Ibajay Branch by the time that MSDC’s predecessor had hired them in the 1950s to work in that branch; and that MSDC and Chan had continuously employed them until their own retirements, that is, Guevarra in 1994, and Palomata and Señeres in 1997. They thereby corroborated the history of MSDC and the names of the various Branch Managers as narrated by Rogelio, and confirmed that like Rogelio, they did not receive any retirement benefits from Chan and MSDC upon their retirement. In their defense, MSDC and Chan denied having engaged in copra buying in Ibajay, insisting that they did not ever register in such business in any government agency. They asserted that Lim had not been their agent or employee, because he had been an independent copra buyer. They averred, however, that Rogelio was their former employee, hired on January 3, 1977 and retired on June 30, 1989;[7] and that Rogelio was thereafter employed by Lim starting from July 1, 1989 until the filing of the complaint. MSDC and Chan submitted the affidavit of Lim, whereby Lim stated that Rogelio was one of his employees from 1989 until the termination of his services.[8] They also submitted SSS Form R-1A, Lim’s SSS Report of Employee-Members (showing that Rogelio and

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Palomata were reported as Lim’s employees);[9] Lim’s application for registration as copra buyer;[10] Chan’s affidavit;[11] and the affidavit of Guevarra[12] and Señeres,[13] whereby said affiants denied having executed or signed the January 19, 1998 affidavits submitted by Rogelio.

In his affidavit, Guevarra recanted the statement attributed to him that he had been employed by Chan and MSDC, and declared that he had been an employee of Lim. Likewise, Guevarra’s daughter executed an affidavit,[14] averring that his father had been an employee of Lim and that his father had not signed the affidavit dated January 19, 1998. On April 5, 1999, the LA dismissed the complaint against Chan and MSDC, ruling thus:

From said evidence, it is our considered view that there exists no employer-employee relationship between

the parties effective July 1, 1989 up to the date of the filing of the instant complaint complainant was an employee of Wynne O. Lim. Hence, his claim for retirement should have been filed against the latter for he admitted that he was the employer of herein complainant in his sworn statement dated June 9, 1998.

Complainant’s claim for retirement benefits against herein respondents under RA No. 7641 has been barred

by prescription considering the fact that it partakes of the nature of a money claim which prescribed after the lapse of three years after its accrual.

The rest of the claims are also dismissed for the same accrued during complainant’s employment with

Wynne O. Lim. WHEREFORE, PREMISES CONSIDERED, this case is hereby DISMISSED for lack of merit. SO ORDERED.[15]

Rogelio appealed, but the NLRC affirmed the decision of the LA on January 28, 2000, observing that there could be no double retirement in the private sector; that with the double retirement, Rogelio would be thereby enriching himself at the expense of the Government; and that having retired in 1991, Rogelio could not avail himself of the benefits under Republic Act No. 7641 entitledAn Act Amending Article 287 of Presidential Decree No. 442, As Amended, Otherwise Known as The Labor Code Of The Philippines, By Providing for Retirement Pay to Qualified Private Sector Employees in the Absence Of Any Retirement Plan in the Establishment , which took effect only on January 7, 1993.[16]

The NLRC denied Rogelio’s motion for reconsideration.

Ruling of the CA

Rogelio commenced a special civil action for certiorari in the CA, charging the NLRC with grave abuse of discretion in denying to him the benefits under Republic Act No. 7641, and in rejecting his money claims on the ground of prescription. On October 24, 2003, the CA promulgated its decision,[17] holding that Rogelio had substantially established that he had been an employee of Chan and MSDC, and that the benefits under Republic Act No. 7641 were apart from the retirement benefits that a qualified employee could claim under the Social Security Law, conformably with the ruling in Oro Enterprises, Inc. v. NLRC(G.R. No. 110861, November 14, 1994, 238 SCRA 105).

The CA decreed:

WHEREFORE, premises considered, the Decision of the public respondent NLRC is hereby VACATED and SET ASIDE. This case is remanded to the Labor Arbiter for the proper computation of the retirement benefits of the petitioner based on Article 287 of the Labor Code, as amended, to be pegged at the minimum wage prevailing in Ibajay, Aklan as of March 17, 1997, and attorney’s fees based on the same. Without costs.

SO ORDERED.

Chan and MSDC’s motion for reconsideration was denied by the CA.

Issues

In this appeal, Chan and MSDC contend that the CA erred: (a) in taking cognizance of Rogelio’s petition for certiorari despite the decision of the NLRC having become final and executory almost two months before the petition was filed; (b) in concluding that Rogelio had remained their employee from July 6, 1989 up to March 17, 1997; and (c) in awarding retirement benefits and attorney’s fees to Rogelio.

Ruling

The petition for review is barren of merit.

ICertiorari was timely commenced in the CA

Anent the first error, the Court finds that the CA did not err in taking cognizance of the petition for certiorari of Rogelio.

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Based on the records, Rogelio received the NLRC’s denial of his motion for reconsideration on January 16, 2003. He then had 60 days from January 16, 2003, or until March 17, 2003, within which to file his petition for certiorari. It is without doubt, therefore, that his filing was timely considering that the CA received his petition for certiorari at 2:44 o’clock in the afternoon of March 17, 2003.

The petitioners’ insistence, that the issuance of the entry of judgment with respect to the NLRC’s decision precluded Rogelio

from filing a petition for certiorari, was unwarranted. It ought to be without debate that the finality of the NLRC’s decision was of no consequence in the consideration of whether or not he could bring a special civil action for certiorari within the period of 60 days for doing so under Section 4, Rule 65, Rules of Court, simply because the question being thereby raised was jurisdictional.

II

Respondent remained the petitioners’employee despite his supposed separation

Did Rogelio remain the employee of the petitioners from July 6, 1989 up to March 17, 1997? The issue of whether or not an employer-employee relationship existed between the petitioners and the respondent in that

period was essentially a question of fact. [18] In dealing with such question, substantial evidence – that amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion[19] – is sufficient. Although no particular form of evidence is required to prove the existence of the relationship, and any competent and relevant evidence to prove the relationship may be admitted,[20] a finding that the relationship exists must nonetheless rest on substantial evidence.

Generally, the Court does not review errors that raise factual questions, primarily because the Court is not a trier of facts.

However, where, like now, there is a conflict between the factual findings of the Labor Arbiter and the NLRC, on the one hand, and those of the CA, on the other hand,[21] it is proper, in the exercise of our equity jurisdiction, to review and re-evaluate the factual issues and to look into the records of the case and re-examine the questioned findings.

The CA delved on and resolved the issue of the existence of an employer-employee relationship between the petitioners and

the respondent thusly:

As to the factual issue, the petitioner’s evidence consists of his own statements and those of his alleged co-worker from 1950 until 1997, Juanito Palomata, who unlike his former co-workers Domingo Guevarra and Ambrosio Señeres, did not disown the “Sinumpaang Salaysay” he executed, in corroboration of petitioner’s allegations; and the Certification dated August 10, 1991 stating that petitioner was first placed under coverage of the SSS in January 1974 to June 30, 1989 and was separated from service effective July 1, 1989, a certification executed by respondent Crispin Amigo Chan which, petitioner maintains, was only intended for his application for retirement benefits with the SSS. Private respondents’ evidence, on the other hand, consisted of respondent Crispin Amigo Chan’s counter statements as well as documentary evidence consisting of (1) Wayne Lim’s Affidavit which petitioner acknowledged in his Reply dated July 11, 1998, par. 8, admitting to being the employer of petitioner from July 1, 1989 until the filing of the complaint; (2) Certification dated October 22, 1991 showing petitioner’s employment with respondents to have been between January 3, 1977 until July 1, 1989; (3) Affidavits of Guevarra and Señeres disowning their signatures in the affidavits submitted in evidence by the petitioner; (4) SSS report executed by Wayne Lim of his initial list of employees as of July 1, 1989 which includes the petitioner. On appeal, the respondents further submitted documentary evidence showing that Wayne Lim registered his business name on July 11, 1989 and apparently went into business buying copra. At this point, we should note the following factual discrepancies in the evidence on hand: First, the respondents issued certificates stating the commencement of petitioner’s employment on different dates, i.e. January 1974 and January 1977, although the earlier date referred only to the period when petitioner was first placed under the coverage of the SSS, which need not necessarily refer to the commencement of his employment. Secondly, while respondent Crispin Amigo Chan denied having ever engaged in copra buying in Ibajay, the certificates he issued both dated in 1991 state otherwise, for he declared himself as a “copra dealer” with address in Ibajay. Then there is the statement of the petitioner that Wayne Lim was the respondents’ manager in their branch office in Ibajay since 1984, a statement that respondents failed to disavow. Instead, respondents insisted on their non sequitur argument that they had never engaged in copra buying activities in Ibajay, and that Wayne Lim was in business all by himself in regard to such activity. The denial on respondents’ part of their copra buying activities in Ibajay begs the obvious question: What were petitioner and his witness Juanito Palomata then doing for respondents as laborers in Ibajay prior to July 1, 1989? Indeed, what did petitioner do for the respondents as the latter’s laborer prior to July 1, 1989, which was different from what he did after said date? The records showed that he continued doing the same job, i.e. as laborer and trusted employee tasked with the responsibility of getting money from the Kalibo office of respondents which was used to buy copra and pay the employees’ salaries. He did not only continue doing the same thing but he apparently did the same at or from the same place, i.e. the bodega in Ibajay, which his co-worker Palomata believed to belong to the respondent Masing & Sons. Since respondents admitted to employing petitioner from 1977 to 1989, we have to conclude that, indeed, the bodega in Ibajay was owned by respondents at least prior to July 1, 1989 since petitioner had consistently stated that he worked for the respondents continuously in their branch office in Ibajay under different managers and nowhere else. We believe that the respondents’ strongest evidence in regard to the alleged separation of petitioner from service effective July 1, 1989 would be the affidavit of Wayne Lim, owning to being the employer of petitioner since July 1, 1989 and the SSS report that he executed listing petitioner as one

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of his employees since said date. But in light of the incontrovertible physical reality that petitioner and his co-workers did go to work day in and day out for such a long period of time, doing the same thing and in the same place, without apparent discontinuity, except on paper, these documents cannot be taken at their face value. We note that Wayne Lim apparently inherited, at least on paper, ten (10) employees of respondent Crispin Amigo Chan, including petitioner, all on the same day, i.e. on July 1, 1989. We note, too, that while there exists an initial report of employees to the SSS by Wayne Lim, no other document apart from his affidavit and business registration was offered by respondents to bolster their contention, irrespective of the fact that Wayne Lim was not a party respondent. What were the circumstances underlying such alleged mass transfer of employment? Unfortunately, the evidence for the respondents does not provide us with ready answers. We could conclude that respondents sold their business in Ibajay and assets to Wayne Lim on July 1, 1989; however, as pointed out above, respondent Crispin Amigo Chan himself said that he was a “copra dealer” from Ibajay in August and October of 1991. Whether or not he was registered as a copra buyer is immaterial, given that he declared himself a “copra dealer” and had apparently engaged in the activity of buying copra, as shown precisely by the employment of petitioner and Palomata. If Wayne Lim, from being the respondents’ manager in Ibajay became an independent businessman and took over the respondents’ business in Ibajay along with all their employees, why did not the respondents’ simply state that fact for the record? More importantly, why did the petitioner and Palomata continue believing that Wayne Lim was only the respondents’ manager? Given the long employment of petitioner with the respondents, was it possible for him and his witness to make such mistake? We do not think so. In case of doubt, the doubt is resolved in favor of labor, in favor of the safety and decent living for the laborer as mandated by Article 1702 of the Civil Code. The reality of the petitioner’s toil speaks louder than words. xxx[22]

We agree with the CA’s factual findings, because they were based on the evidence and records of the case submitted before

the LA. The CA essentially complied with the guidepost that the substantiality of evidence depends on both its quantitative and its qualitative aspects.[23] Indeed, the records substantially established that Chan and MSDC had employed Rogelio until 1997. In contrast, Chan and MSDC failed to adduce credible substantiation of their averment that Rogelio had been Lim’s employee from July 1989 until 1997. Credible proof that could outweigh the showing by Rogelio to the contrary was demanded of Chan and MSDC to establish the veracity of their allegation, for their mere allegation of Rogelio’s employment under Lim did not constitute evidence,[24] but they did not submit such proof, sadly failing to discharge their burden of proving their own affirmative allegation. [25] In this regard, as we pointed out at the start, the doubts reasonably arising from the evidence are resolved in favor of the laborer in any controversy between a laborer and his master.

III

Respondent entitled to retirement benefitsfrom the petitioners

Article 287 of the Labor Code, as amended by Republic Act No. 7641, provides:

Article 287. Retirement. – Any employee may be retired upon reaching the retirement age established in the collective bargaining agreement or other applicable employment contract.

In case of retirement, the employee shall be entitled to receive such retirement benefits as he may have

earned under existing laws and any collective bargaining agreement and other agreements; Provided, however, That an employee’s retirement benefits under any collective bargaining and other agreements shall not be less than those provided herein.

In the absence of a retirement plan or agreement providing for retirement benefits of employees

in the establishment, an employee upon reaching the age of sixty (60) years or more, but not beyond sixty-five (65) years which is hereby declared the compulsory retirement age, who has served at least five (5) years in the said establishment, may retire and shall be entitled to retirement pay equivalent to at least one-half (1/2) month salary for every year of service, a fraction of at least six (6) months being considered as one whole year.

Unless the parties provide for broader inclusions, the term one-half (1/2) month salary shall

mean fifteen (15) days plus one-twelfth (1/12) of the 13th month pay and the cash equivalent of not more than five (5) days of service incentive leaves.

Retail, service and agricultural establishments or operations employing not more than ten (10) employees or

workers are exempted from the coverage of this provision. Violation of this provision is hereby declared unlawful and subject to the penal provisions provided under

Article 288 of this Code. Was Rogelio entitled to the retirement benefits under Article 287 of the Labor Code, as amended by Republic Act No. 7641? The CA held so in its decision, to wit: Having reached the conclusion that petitioner was an employee of the respondents from 1950 to March 17, 1997, and considering his uncontroverted allegation that in the Ibajay branch office where he was assigned, respondents employed no less than 12 workers at said later date, thus affording private respondents no relief from the duty of providing retirement benefits to their employees, we see no reason why petitioner should not be

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entitled to the retirement benefits as provided for under Article 287 of the Labor Code, as amended. The beneficent provisions of said law, as applied in Oro Enterprises Inc. v. NLRC, is apart from the retirement benefits that can be claimed by a qualified employee under the social security law. Attorney’s fees are also granted to the petitioner. But the monetary benefits claimed by petitioner cannot be granted on the basis of the evidence at hand.[26]

We concur with the CA’s holding. The third paragraph of the aforequoted provision of the Labor Code entitled Rogelio to

retirement benefits as a necessary consequence of the finding that Rogelio was an employee of MSDC and Chan. Indeed, there should be little, if any, doubt that the benefits under Republic Act No. 7641, which was enacted as a labor protection measure and as a curative statute to respond, in part at least, to the financial well-being of workers during their twilight years soon following their life of labor, can be extended not only from the date of its enactment but retroactively to the time the employment contracts started. [27]

WHEREFORE, the Court denies the petition for review on certiorari, and affirms the decision promulgated on October 24, 2003 in CA-G.R. SP No.75983.

Costs of suit to be paid by the petitioners.

SO ORDERED.

CESAR C. LIRIO, doing business under the name and style of CELKOR AD SONICMIX, Petitioner,

- versus - WILMER D. GENOVIA, Respondent.

G.R. No. 169757 Present:

VELASCO, JR., J., Chairperson, PERALTA, ABAD, PEREZ,* and MENDOZA, JJ.

Promulgated: November 23, 2011

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D E C I S I O N

PERALTA, J.:

This is a petition for review on certiorari of the decision of the Court of Appeals in CA-G.R. SP No. 88899 dated August 4,

2005 and its Resolution dated September 21, 2005, denying petitioner’s motion for reconsideration. The Court of Appeals reversed and set aside the resolution of the NLRC, and reinstated the decision of the Labor Arbiter with

modification, finding that respondent is an employee of petitioner, and that respondent was illegally dismissed and entitled to the payment of backwages and separation pay in lieu of reinstatement.

The facts are as follows:

On July 9, 2002, respondent Wilmer D. Genovia filed a complaint against petitioner Cesar Lirio and/or Celkor Ad Sonicmix

Recording Studio for illegal dismissal, non-payment of commission and award of moral and exemplary damages.

In his Position Paper,[1] respondent Genovia alleged, among others, that on August 15, 2001, he was hired as studio manager by petitioner Lirio, owner of Celkor Ad Sonicmix Recording Studio (Celkor). He was employed to manage and operate Celkor and to promote and sell the recording studio's services to music enthusiasts and other prospective clients. He received a monthly salary of P7,000.00. They also agreed that he was entitled to an additional commission of P100.00 per hour as recording technician whenever a client uses the studio for recording, editing or any related work. He was made to report for work from Monday to Friday from 9:00 a.m. to 6 p.m. On Saturdays, he was required to work half-day only, but most of the time, he still rendered eight hours of work or more. All the employees of petitioner, including respondent, rendered overtime work almost everyday, but petitioner never kept a daily time record to avoid paying the employees overtime pay.

Respondent stated that a few days after he started working as a studio manager, petitioner approached him and told him

about his project to produce an album for his 15-year-old daughter, Celine Mei Lirio, a former talent of ABS-CBN Star Records. Petitioner asked respondent to compose and arrange songs for Celine and promised that he (Lirio) would draft a contract to assure respondent of his compensation for such services. As agreed upon, the additional services that respondent would render included composing and arranging musical scores only, while the technical aspect in producing the album, such as digital editing, mixing and

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sound engineering would be performed by respondent in his capacity as studio manager for which he was paid on a monthly basis. Petitioner instructed respondent that his work on the album as composer and arranger would only be done during his spare time, since his other work as studio manager was the priority. Respondent then started working on the album.

Respondent alleged that before the end of September 2001, he reminded petitioner about his compensation as composer

and arranger of the album. Petitioner verbally assured him that he would be duly compensated. By mid-November 2001, respondent finally finished the compositions and musical arrangements of the songs to be included in the album. Before the month ended, the lead and back-up vocals in the ten (10) songs were finally recorded and completed. From December 2001 to January 2002, respondent, in his capacity as studio manager, worked on digital editing, mixing and sound engineering of the vocal and instrumental audio files.

Thereafter, respondent was tasked by petitioner to prepare official correspondence, establish contacts and negotiate with

various radio stations, malls, publishers, record companies and manufacturers, record bars and other outlets in preparation for the promotion of the said album. By early February 2002, the album was in its manufacturing stage. ELECTROMAT, manufacturer of CDs and cassette tapes, was tapped to do the job. The carrier single of the album, which respondent composed and arranged, was finally aired over the radio on February 22, 2002.

On February 26, 2002, respondent again reminded petitioner about the contract on his compensation as composer and

arranger of the album. Petitioner told respondent that since he was practically a nobody and had proven nothing yet in the music industry, respondent did not deserve a high compensation, and he should be thankful that he was given a job to feed his family. Petitioner informed respondent that he was entitled only to 20% of the net profit, and not of the gross sales of the album, and that the salaries he received and would continue to receive as studio manager of Celkor would be deducted from the said 20% net profit share. Respondent objected and insisted that he be properly compensated. On March 14, 2002, petitioner verbally terminated respondent’s services, and he was instructed not to report for work.

Respondent asserts that he was illegally dismissed as he was terminated without any valid grounds, and no hearing was

conducted before he was terminated, in violation of his constitutional right to due process. Having worked for more than six months, he was already a regular employee. Although he was a so called “studio manager,” he had no managerial powers, but was merely an ordinary employee.

Respondent prayed for his reinstatement without loss of seniority rights, or, in the alternative, that he be paid separation

pay, backwages and overtime pay; and that he be awarded unpaid commission in the amount of P2,000.00 for services rendered as a studio technician as well as moral and exemplary damages.

Respondent’s evidence consisted of the Payroll dated July 31, 2001 to March 15, 2002, which was certified correct by

petitioner,[2] and Petty Cash Vouchers[3] evidencing receipt of payroll payments by respondent from Celkor. In defense, petitioner stated in his Position Paper[4] that respondent was not hired as studio manager, composer, technician

or as an employee in any other capacity of Celkor. Respondent could not have been hired as a studio manager, since the recording studio has no personnel except petitioner. Petitioner further claimed that his daughter Celine Mei Lirio, a former contract artist of ABS-CBN Star Records, failed to come up with an album as the latter aborted its project to produce one. Thus, he decided to produce an album for his daughter and established a recording studio, which he named Celkor Ad Sonicmix Recording Studio. He looked for a composer/arranger who would compose the songs for the said album. In July 2001, Bob Santiago, his son-in-law, introduced him to respondent, who claimed to be an amateur composer, an arranger with limited experience and musician without any formal musical training. According to petitioner, respondent had no track record as a composer, and he was not known in the field of music. Nevertheless, after some discussion, respondent verbally agreed with petitioner to co-produce the album based on the following terms and conditions: (1) petitioner shall provide all the financing, equipment and recording studio; (2) Celine Mei Lirio shall sing all the songs; (3) respondent shall act as composer and arranger of all the lyrics and the music of the five songs he already composed and the revival songs; (4) petitioner shall have exclusive right to market the album; (5) petitioner was entitled to 60% of the net profit, while respondent and Celine Mei Lirio were each entitled to 20% of the net profit; and (6) respondent shall be entitled to draw advances of P7,000.00 a month, which shall be deductible from his share of the net profits and only until such time that the album has been produced.

According to petitioner, they arrived at the foregoing sharing of profits based on the mutual understanding that respondent was just an amateur composer with no track record whatsoever in the music industry, had no definite source of income, had limited experience as an arranger, had no knowledge of the use of sound mixers or digital arranger and that petitioner would help and teach him how to use the studio equipment; that petitioner would shoulder all the expenses of production and provide the studio and equipment as well as his knowledge in the use thereof; and Celine Mei Lirio would sing the songs. They embarked on the production of the album on or about the third week of August 2002.

Petitioner asserted that from the aforesaid terms and conditions, his relationship with respondent is one of an informal

partnership under Article 1767[5] of the New Civil Code, since they agreed to contribute money, property or industry to a common fund with the intention of dividing the profits among themselves. Petitioner had no control over the time and manner by which respondent composed or arranged the songs, except on the result thereof. Respondent reported to the recording studio between 10:00 a.m. and 12:00 noon. Hence, petitioner contended that no employer-employee relationship existed between him and the respondent, and there was no illegal dismissal to speak of.

On October 31, 2003, Labor Arbiter Renaldo O. Hernandez rendered a decision,[6] finding that an employer-employee relationship existed between petitioner and respondent, and that respondent was illegally dismissed. The dispositive portion of the decision reads:

WHEREFORE, premises considered, we find that respondents CELKOR AD SONICMIX RECORDING STUDIO

and/ or CESAR C. LIRIO (Owner), have illegally dismissed complainant in his status as regular employee and, consequently, ORDERING said respondents:

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1) To pay him full backwages from date of illegal dismissal on March 14, 2002 until

finality of this decision and, in lieu of reinstatement, to [pay] his separation pay of one (1) month pay per year of service reckoned from [the] date of hire on August 15, 2001 until finality of this decision, which as of date amounts to full backwages total of 145,778.6 (basic P7,000.00 x 19.6 mos.=P133,000.00 + 1/12 thereof as 13th month pay of P11,083.33 + SILP P7,000/32.62 days=P214.59/day x 5=P1,072.96 x 1.58 yrs.=P1,695.27); separation pay of P 22,750.00 (P7,000.00 x 3.25 yrs.);

2) To pay complainant's unpaid commission of P2,000.00;3) To pay him moral and exemplary damages in the combined amount of P75,000.00.

Other monetary claims of complainant are dismissed for lack of merit.[7]

The Labor Arbiter stated that petitioner’s denial of the employment relationship cannot overcome respondent’s positive assertion and documentary evidence proving that petitioner hired respondent as his employee.[8]

Petitioner appealed the decision of the Labor Arbiter to the National Labor Relations Commission (NLRC).

In a Resolution7 dated October 14, 2004, the NLRC reversed and set aside the decision of the Labor Arbiter. The dispositive

portion of the Resolution reads:

WHEREFORE, premises considered, the Appeal is GRANTED. Accordingly, the Decision appealed from is

REVERSED and, hence, SET ASIDE and a new one ENTERED dismissing the instant case for lack of merit.[9]

The NLRC stated that respondent failed to prove his employment tale with substantial evidence. Although the NLRC agreed that respondent was able to prove that he received gross pay less deduction and net pay, with the corresponding Certification of Correctness by petitioner, covering the period from July 31, 2001 to March 15, 2002, the NLRC held that respondent failed to proved with substantial evidence that he was selected and engaged by petitioner, that petitioner had the power to dismiss him, and that they had the power to control him not only as to the result of his work, but also as to the means and methods of accomplishing his work.

Respondent’s motion for reconsideration was denied by the NLRC in a Resolution9 dated December 14, 2004.

Respondent filed a petition for certiorari before the Court of Appeals.

On August 4, 2005, the Court of Appeals rendered a decision [10] reversing and setting aside the resolution of the NLRC, and reinstating the decision of the Labor Arbiter, with modification in regard to the award of commission and damages. The Court of Appeals deleted the award of commission, and moral and exemplary damages as the same were not substantiated. The dispositive portion of the Court of Appeals’ decision reads:

WHEREFORE, the petition is GRANTED and the assailed resolutions dated October 14, 2004 and

December 14, 2004 are hereby REVERSED and SET ASIDE. Accordingly, the decision dated October 31, 2003 of the Labor Arbiter is REINSTATED, with the modification that the awards of commission and damages are deleted.[11] (Emphasis supplied.)

Petitioner’s motion for reconsideration was denied for lack of merit by the Court of Appeals in its Resolution [12] dated

September 21, 2005.

Hence, petitioner Lirio filed this petition.

Petitioner states that respondent appealed to the Court of Appeals via a petition for certiorari under Rule 65, which will prosper only if there is a showing of grave abuse of discretion or an act without or in excess of jurisdiction on the part of the NLRC.[13] However, petitioner contends that the Court of Appeals decided the case not in accordance with law and applicable rulings of this Court as petitioner could not find any portion in the Decision of the Court of Appeals ruling that the NLRC acted without or in excess of jurisdiction or with grave abuse of discretion amounting to lack or excess of jurisdiction. Petitioner submits that the Court of Appeals could not review an error of judgment by the NLRC raised before it on a petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure. Moreover, petitioner contends that it was error on the part of the Court of Appeals to review the finding of facts of the NLRC on whether there exists an employer-employee relationship between the parties.

Petitioner’s argument lacks merit. It is noted that respondent correctly sought judicial review of the decision of the NLRC via a petition for certiorari under Rule

65 of the Rules of Court filed before the Court of Appeals in accordance with the decision of the Court in St. Martin Funeral Home v. NLRC,[14] which held:

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Therefore, all references in the amended Section 9 of B.P. No. 129 to supposed appeals from the NLRC to the Supreme Court are interpreted and hereby declared to mean and refer to petitions for certiorari under Rule 65. Consequently, all such petitions should henceforth be initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts as the appropriate forum for the relief desired.[15]

The Court of Appeals stated in its decision that the issue it had to resolve was “whether or not the public respondent [NLRC] committed grave abuse of discretion when it declared that no employer-employee relationship exists between the petitioner and the private respondents, since the petitioner failed to prove such fact by substantial evidence.”[16]

Errors of judgment, as distinguished from errors of jurisdiction, are not within the province of a special civil action

for certiorari, which is merely confined to issues of jurisdiction or grave abuse of discretion. [17] By grave abuse of discretion is meant such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction, and it must be shown that the discretion was exercised arbitrarily or despotically.[18]

The Court of Appeals, therefore, could grant the petition for certiorari if it finds that the NLRC, in its assailed decision or resolution, committed grave abuse of discretion by capriciously, whimsically, or arbitrarily disregarding evidence that is material to or decisive of the controversy; and it cannot make this determination without looking into the evidence of the parties. [19]Necessarily, the appellate court can only evaluate the materiality or significance of the evidence, which is alleged to have been capriciously, whimsically, or arbitrarily disregarded by the NLRC, in relation to all other evidence on record. [20] Thus, contrary to the contention of petitioner, the Court of Appeals can review the finding of facts of the NLRC and the evidence of the parties to determine whether the NLRC gravely abused its discretion in finding that no employer-employee relationship existed between petitioner and respondent. [21]

Respondent raised before the Court of Appeals the following issues: I. RESPONDENT NATIONAL LABOR RELATIONS COMMISSION COMMITTED GRAVE ABUSE OF DISCRETION IN SHIFTING THE BURDEN OF PROVING THAT EMPLOYMENT RELATIONS EXISTED BETWEEN THE PETITIONER AND THE PRIVATE RESPONDENTS TO THE FORMER, IN VIOLATION OF ESTABLISHED PROVISION OF LAWS AND JURISPRUDENCE.

II. RESPONDENT NATIONAL LABOR RELATIONS COMMISSION COMMITTED GRAVE ABUSE OF

DISCRETION IN HOLDING THAT NO EMPLOYER-EMPLOYEE RELATIONSHIP EXISTED BETWEEN THE PETITIONER AND THE PRIVATE RESPONDENTS.

III. RESPONDENT NATIONAL LABOR RELATIONS COMMISSION COMMITTED GRAVE ABUSE OF

DISCRETION IN DISREGARDING THE PETITIONER'S PAYROLL AND THE PETTY CASH VOUCHERS AS AN INDICIA OF EMPLOYMENT RELATIONS BETWEEN PETITIONER AND THE PRIVATE RESPONDENTS.[22]

Between the documentary evidence presented by respondent and the mere allegation of petitioner without any proof by

way of any document evincing their alleged partnership agreement, the Court of Appeals agreed with the Labor Arbiter that petitioner failed to substantiate his claim that he had a partnership with respondent, citing the Labor Arbiter’s finding, thus:

In this case, complainant's evidence is substantial enough to prove the employment relationship that on

August 14, 2001, he was hired as 'Studio manager' by respondent Lirio to manage and operate the recording studio and to promote and sell its services to music enthusiasts and clients, proven by his receipt for this purpose from said respondent a fixed monthly compensation of P7,000.00, with commission of P100.00 per hour when serving as recording technician, shown by the payroll from July 31, 2001-March 15, 2002. The said evidence points to complainant's hiring as employee so that the case comes within the purview of our jurisdiction on labor disputes between an employer and an employee. x x x.

Respondent Lirio's so-called existence of a partnership agreement was not substantiated and his assertion thereto, in the face of complainant's evidence, constitute but a self-serving assertion, without probative value, a mere invention to justify the illegal dismissal.

x x x x Indeed, we find credible that what caused complainant's dismissal on March 14, 2002 was due to his

refusal to respondent's Lirio's insistences on merely giving him 20% based on net profit on sale of the album which he composed and arranged during his free time and, moreover, that salaries which he received would be deducted therefrom, which obviously, soured the relations from the point of view of respondent Lirio.[23]

Hence, based on the finding above and the doctrine that “if doubt exists between the evidence presented by the employer

and the employee, the scales of justice must be tilted in favor of the latter,” [24] the Court of Appeals reversed the resolution of the NLRC and reinstated the decision of the Labor Arbiter with modification. Even if the Court of Appeals was remiss in not stating it in definite terms, it is implied that the Court of Appeals found that the NLRC gravely abused its discretion in finding that no employer-employee relationship existed between petitioner and respondent based on the evidence on record.

We now proceed to the main issue raised before this Court: Whether or not the decision of the Court of Appeals is in accordance with law, or whether or not the Court of Appeals erred in reversing and setting aside the decision of the NLRC, and reinstating the decision of the Labor Arbiter with modification.

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In petitions for review, only errors of law are generally reviewed by this Court. This rule, however, is not ironclad. [25] Where the issue is shrouded by a conflict of factual perceptions by the lower court or the lower administrative body, in this case, the NLRC, this Court is constrained to review the factual findings of the Court of Appeals.[26]

Before a case for illegal dismissal can prosper, it must first be established that an employer-employee relationship existed

between petitioner and respondent.[27]

The elements to determine the existence of an employment relationship are: (a) the selection and engagement of the

employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer’s power to control the employee’s conduct. The most important element is the employer’s control of the employee’s conduct, not only as to the result of the work to be done, but also as to the means and methods to accomplish it.[28]

It is settled that no particular form of evidence is required to prove the existence of an employer-employee relationship.

[29] Any competent and relevant evidence to prove the relationship may be admitted.[30]

In this case, the documentary evidence presented by respondent to prove that he was an employee of petitioner are as

follows: (a) a document denominated as "payroll" (dated July 31, 2001 to March 15, 2002) certified correct by petitioner,[31] which showed that respondent received a monthly salary of P7,000.00 (P3,500.00 every 15th of the month and another P3,500.00 every 30th of the month) with the corresponding deductions due to absences incurred by respondent; and (2) copies of petty cash vouchers,[32] showing the amounts he received and signed for in the payrolls.

The said documents showed that petitioner hired respondent as an employee and he was paid monthly wages

of P7,000.00. Petitioner wielded the power to dismiss as respondent stated that he was verbally dismissed by petitioner, and respondent, thereafter, filed an action for illegal dismissal against petitioner. The power of control refers merely to the existence of the power.[33] It is not essential for the employer to actually supervise the performance of duties of the employee, as it is sufficient that the former has a right to wield the power.[34] Nevertheless, petitioner stated in his Position Paper that it was agreed that he would help and teach respondent how to use the studio equipment. In such case, petitioner certainly had the power to check on the progress and work of respondent.

On the other hand, petitioner failed to prove that his relationship with respondent was one of partnership. Such claim was

not supported by any written agreement. The Court notes that in the payroll dated July 31, 2001 to March 15, 2002,[35] there were deductions from the wages of respondent for his absence from work, which negates petitioner’s claim that the wages paid were advances for respondent’s work in the partnership. In Nicario v. National Labor Relations Commission,[36] the Court held:

It is a well-settled doctrine, that if doubts exist between the evidence presented by the employer and the

employee, the scales of justice must be tilted in favor of the latter. It is a time-honored rule that in controversies between a laborer and his master, doubts reasonably arising from the evidence, or in the interpretation of agreements and writing should be resolved in the former’s favor. The policy is to extend the doctrine to a greater number of employees who can avail of the benefits under the law, which is in consonance with the avowed policy of the State to give maximum aid and protection of labor. This rule should be applied in the case at bar, especially since the evidence presented by the private respondent company is not convincing. x x x[37]

Based on the foregoing, the Court agrees with the Court of Appeals that the evidence presented by the parties showed that an employer-employee relationship existed between petitioner and respondent.

In termination cases, the burden is upon the employer to show by substantial evidence that the termination was for lawful

cause and validly made.[38] Article 277 (b) of the Labor Code[39]puts the burden of proving that the dismissal of an employee was for a valid or authorized cause on the employer, without distinction whether the employer admits or does not admit the dismissal. [40] For an employee’s dismissal to be valid, (a) the dismissal must be for a valid cause, and (b) the employee must be afforded due process.[41] Procedural due process requires the employer to furnish an employee with two written notices before the latter is dismissed: (1) the notice to apprise the employee of the particular acts or omissions for which his dismissal is sought, which is the equivalent of a charge; and (2) the notice informing the employee of his dismissal, to be issued after the employee has been given reasonable opportunity to answer and to be heard on his defense. [42] Petitioner failed to comply with these legal requirements; hence, the Court of Appeals correctly affirmed the Labor Arbiter’s finding that respondent was illegally dismissed, and entitled to the payment of backwages, and separation pay in lieu of reinstatement.

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in CA-G.R. SP No. 88899, dated August 4, 2005,

and its Resolution dated September 21, 2005, areAFFIRMED. No costs.

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REPUBLIC ACT NO. 8042Migrant Workers and Overseas Filipinos Act of 1995

An act to institute the policies of overseas employment and establish a higher standard of protection and promotion of the welfare of migrant workers, their families and overseas Filipinos in distress, and for other purposes.

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

SEC. 1. SHORT TITLE. - This act shall be known and cited as the "Migrant Workers and Overseas Filipinos Act of 1995."

SEC. 2. DECLARATION OF POLICIES--

(a) In the pursuit of an independent foreign policy and while considering national sovereignty, territorial integrity, national interest and the right to self-determination paramount in its relations with other states, the State shall, at all times, uphold the dignity of its citizens whether in country or overseas, in general, and Filipino migrant workers, in particular.

(b) The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all. Towards this end, the State shall provide adequate and timely social, economic and legal services to Filipino migrant workers.

(c) While recognizing the significant contribution of Filipino migrant workers to the national economy through their foreign exchange remittances, the State does not promote overseas employment as a means to sustain economic growth and achieve national development. The existence of the overseas employment program rests solely on the assurance that the dignity and fundamental human rights and freedoms of the Filipino citizens shall not, at any time, be compromised or violated. The State, therefore, shall continuously create local employment opportunities and promote the equitable distribution of wealth and the benefits of development.

(d) The State affirms the fundamental equality before the law of women and men and the significant role of women in nation-building. Recognizing the contribution of overseas migrant women workers and their particular vulnerabilities, the State shall apply gender sensitive criteria in the formulation and implementation of policies and programs affecting migrant workers and the composition of bodies tasked for the welfare of migrant workers.

(e) Free access to the courts and quasi-judicial bodies and adequate legal assistance shall not be denied to any persons by reason of poverty. In this regard, it is imperative that an effective mechanism be instituted to ensure that the rights and interest of distressed overseas Filipinos, in general, and Filipino migrant workers, in particular, documented or undocumented, are adequately protected and safeguarded.

(f) The right of Filipino migrant workers and all overseas Filipinos to participate in the democratic decision-making processes of the State and to be represented in institutions relevant to overseas employment is recognized and guaranteed.

(g) The State recognizes that the ultimate protection to all migrant workers is the possession of skills. Pursuant to this and as soon as practicable, the government shall deploy and/or allow the deployment only to skilled Filipino workers.

(h) Non-governmental organizations, duly recognized as legitimate, are partners of the State in the protection of Filipino migrant workers and in the promotion of their welfare, the State shall cooperate with them in a spirit of trust and mutual respect.

(I) Government fees and other administrative costs of recruitment, introduction, placement and assistance to migrant workers shall be rendered free without prejudice to the provision of Section 36 hereof.

Nonetheless, 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.

SEC. 3. DEFINITIONS. - For purposes of this Act:

(a) "Migrant worker" refers to a person who is to be engaged, is engaged or has been engaged in a renumerated activity in a state of which he or she is not a legal resident to be used interchangeably with overseas Filipino worker.

(b) "Gender-sensitivity" shall mean cognizance of the inequalities and inequities prevalent in society between women and men and a commitment to address issues with concern for the respective interests of the sexes.

(c) "Overseas Filipinos" refers to dependents of migrant workers and other Filipino nationals abroad who are in distress as mentioned in Sections 24 and 26 of this Act.

I. DEPLOYMENT

SEC. 4. Deployment of Migrant Workers - The State shall deploy overseas Filipino workers only in countries where the rights of Filipino migrant workers are protected. The government recognizes any of the following as guarantee on the part of the receiving country for the protection and the rights of overseas Filipino workers:

(a) It has existing labor and social laws protecting the rights of migrant workers;

(b) It is a signatory to multilateral conventions, declaration or resolutions relating to the protection of migrant workers;

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(c) It has concluded a bilateral agreement or arrangement with the government protecting the rights of overseas Filipino workers; and

(d) It is taking positive, concrete measures to protect the rights of migrant workers.

SEC. 5. TERMINATION OR BAN ON DEPLOYMENT - Notwithstanding the provisions of Section 4 hereof, the government, in pursuit of the national interest or when public welfare so requires, may, at any time, terminate or impose a ban on the deployment of migrant workers.

II. ILLEGAL RECRUITMENT

Sec. 6. DEFINITIONS. - For purposes of this Act, illegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing, hiring, procuring workers and includes referring, contact services, promising or advertising for employment abroad, whether for profit or not, when undertaken by a non-license or non-holder of authority contemplated under Article 13(f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the Philippines. Provided, that such non-license or non-holder, who, in any manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so engaged. It shall likewise include the following acts, whether committed by any persons, whether a non-licensee, non-holder, licensee or holder of authority.

(a) To charge or accept directly or indirectly any amount greater than the specified in the schedule of allowable fees prescribed by the Secretary of Labor and Employment, or to make a worker pay any amount greater than that actually received by him as a loan or advance;

(b) To furnish or publish any false notice or information or document in relation to recruitment or employment;

(c) To give any false notice, testimony, information or document or commit any act of misrepresentation for the purpose of securing a license or authority under the Labor Code;

(d) To induce or attempt to induce a worker already employed to quit his employment in order to offer him another unless the transfer is designed to liberate a worker from oppressive terms and conditions of employment;

(e) To influence or attempt to influence any persons or entity not to employ any worker who has not applied for employment through his agency;

(f) To engage in the recruitment of placement of workers in jobs harmful to public health or morality or to dignity of the Republic of the Philippines;

(g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and Employment or by his duly authorized representative;

(h) To fail to submit reports on the status of employment, placement vacancies, remittances of foreign exchange earnings, separations from jobs, departures and such other matters or information as may be required by the Secretary of Labor and Employment;

(i) To substitute or alter to the prejudice of the worker, employment contracts approved and verified by the Department of Labor and Employment from the time of actual signing thereof by the parties up to and including the period of the expiration of the same without the approval of the Department of Labor and Employment;

(j) For an officer or agent of a recruitment or placement agency to become an officer or member of the Board of any corporation engaged in travel agency or to be engaged directly on indirectly in the management of a travel agency;

(k) To withhold or deny travel documents from applicant workers before departure for monetary or financial considerations other than

those authorized under the Labor Code and its implementing rules and regulations;

(l) Failure to actually deploy without valid reasons as determined by the Department of Labor and Employment; and

(m) Failure to reimburse expenses incurred by the workers in connection with his documentation and processing for purposes of deployment, in cases where the deployment does not actually take place without the worker's fault. Illegal recruitment when committed by a syndicate or in large scale shall be considered as offense involving economic sabotage.

Illegal recruitment is deemed committed by a syndicate carried out by a group of three (3) or more persons conspiring or confederating with one another. It is deemed committed in large scale if committed against three (3) or more persons individually or as a group.

The persons criminally liable for the above offenses are the principals, accomplices and accessories. In case of juridical persons, the officers having control, management or direction of their business shall be liable.

SEC. 7. PENALTIES -

(a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less than six (6) years and one (1) day but not more than twelve (12) years and a fine not less than two hundred thousand pesos (P200,000.00) nor more than five hundred thousand pesos (P500,000.00).

(b) The penalty of life imprisonment and a fine of not less than five hundred thousand pesos (P500,000.00) nor more than one million pesos (P1,000,000.00) shall be imposed if illegal recruitment constitutes economic sabotage as defined herein.

Provided, however, that the maximum penalty shall be imposed if the person illegally recruited is less than eighteen (18) years of age or committed by a non-licensee or non-holder of authority.

SEC. 8. PROHIBITION ON OFFICIALS AND EMPLOYEES. - Ot shall be unlawful for any official or employee of the Department of Labor and Employment, the Philippine Overseas Employment Administration, or the Overseas Workers Welfare Administration, or the Department of Foreign Affairs, or other government agencies involved in the implementation of this Act, or their relatives within the fourth civil degree of consanguinity or affinity, to engage, directly or indirectly, in the business of recruiting migrant workers as defined in this Act. The penalties shall be imposed upon them.

SEC. 9. VENUE. - A criminal action arising from illegal recruitment as defined herein shall be filed with the Regional Trial Court of the province or city where the offense was committed or where the offended party actually resides at the same time of the commission of the offense: Provided, That the court where the criminal action is first filed shall acquire jurisdiction to the exclusion of other courts. Provided, however, That the aforestated provisions shall also apply to those criminal actions that have already been filed in court at the time of the effectivity of this Act.

SEC. 10. MONEY CLAIMS. - Botwithstanding any provision of law to the contrary, the Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the priginal and exclusive jurisdiction to hear and decide, within ninety (90) calendar days after filing of the complaint, the claims arising out of an employer-employee relationship or by virtue of any law or contract involving Filipino workers for overseas deployment including claims for actual, moral, exemplary and other forms of damages.

The liability of the principal/employer and the recruitment/placement agency for any and all claims under this section shall be joint and several. This provisions shall be incorporated in the contract for overseas employment and shall be a condition precedent for its approval. The performance bond to be filed by the recruitment/placement agency, as provided by law, shall be answerable for all money claims or damages that may be awarded to

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the workers. If the recruitment/placement agency is a juridical being, the corporate officers and directors and partners as the case may be, shall themselves be jointly and solidarily liable with the corporation or partnership for the aforesaid claims and damages.

Such liabilities shall continue during the entire period or duration of the employment contract and shall not be affected by any substitution, amendment or modification made locally or in a foreign country of the said contract.

Any compromise/amicable settlement or voluntary agreement on money claims inclusive of damages under this section shall be paid within four (4) months from the approval of the settlement by the appropriate authority.

In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the workers shall be entitled to the full reimbursement of his placement fee with interest of twelve 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.

Non-compliance with the mandatory periods for resolutions of cases provided under this section shall subject the responsible officials to any or all of the following penalties:

(a) The salary of any such official who fails to render his decision or resolutions within the prescribed period shall be, or caused to be, withheld until the said official complies therewith;

(b) Suspension for not more than ninety (90) days; or

(c) Dismissal from the service with disqualifications to hold any appointive public office for five (5) years.

Provided, however, that the penalties herein provided shall be without prejudice to any liability which any such official may have incurred under other existing laws or rules and regulations as a consequence of violating the provisions of this paragraph.

SEC. 11. MANADATORY PERIODS FOR RESOLUTION OF ILLEGAL RECRUITMENT CASES. - The preliminary investigations of cases under this Act shall be terminated within a period of thirty (30) calendar days from the date of their filing. Where the preliminary investigation is conducted by a prosecution officer and a prima facie case is established, the corresponding information shall be filed in court within twenty-four (24) hours from the termination of the investigation. If the preliminary investigation is conducted by a judge and a prima facie case is found to exist, prosecution officer within forty-eight (48) hours from the date of receipt of the records of the case.

SEC. 12. PRESCRIPTIVE PERIODS. - Illegal recruitment cases under this Act shall prescribe in five (5) years: Provided, however, That illegal recruitment cases involving economic sabotage as defined herein shall prescribe in twenty (20) years.

SEC. 13. FREE LEGAL ASSISTANCE, PREFERENTIAL ENTITLEMENT UNDER THE WITNESS PROTECTION PROGRAM. - A mechanism for free legal assistance for victims of illegal recruitment shall be established within the Department of Labor and Employment including its regional offices. Such mechanism must include coordination and cooperation with the Department of Justice, the Integrated Bar of the Philippines, and other non-governmental organizations and volunteer groups.

The provisions of Republic Act No. 6981 to the contrary, notwithstanding, any person who is a victim of illegal recruitment shall be entitled to the Witness Protection Program provided thereunder.

III. SERVICES

SEC. 14. TRAVEL ADVISORY/INFORMATION DISSEMINATION. - To give utmost priority to the establishment of programs and services to prevent illegal recruitment, fraud, and exploitation or abuse of

Filipino migrant workers, all embassies and consular offices, through the Philippine Overseas Employment Administration (POEA), shall issue travel advisories or disseminate information on labor and employment conditions, migration realities and other facts; and adherence of particular countries to international standards on human and workers' rights which will adequately prepare individuals into making informed and intelligent decisions about overseas employment. Such advisory or information shall be published in a newspaper of general circulation at least three (3) times in every quarter.

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 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.

The Overseas Workers Welfare Administration (OWWA), in coordination ith appropriate international agencies, shall undertake the repatriation of workers in cases of war, epidemic, disasters or calamities, natural or man-made, and other similar events without prejudice to reimbursement by the responsible principal or agency. However, in cases where the principal or recruitment agency cannot be identified, all costs attendant to repatriation shall be borne by the OWWA.

For this purposes, there is hereby created and established an emergency repatriation fund under the administration control and supervision of the OWWA, initially to consist of one hundred million pesos (P100,000,000.00), inclusive of outstanding balances.

SEC. 16. MANDATORY REPATRIATION OF UNDERAGE MIGRANT WORKERS. - Upon discovery or being informed of the presence of migrant workers whose actual ages fall below the minimum age requirement for overseas deployment, the responsible officers in the foreign service shall without delay repatriate said workers and advise the Department of Foreign Affairs through the fastest means of communication availavle of such discovery and other relevant information.

SEC. 17. ESTABLISHMENT OF RE-PLACEMENT AND MONITORING CENTER. - A replacement and monitoring center is hereby created in the Department of Labor and Employment for returning Filipino migrant workers which shall provide a mechanism for their reintegration into the Philippine society, serve as a promotion house for their local employment, and tap their skills and potentials for national development.

The Department of Labor and Employment, the Overseas Workers Welfare Administration, and the Philippine Overseas Employment Administration shall, within ninety (90) days from the effectivity of this Act, formulate a program that would motivate migrant workers to plan for productive options such as entry into highly technical jobs or undertakings, livelihood and entrepreneurial development, better wage employment, and investment of savings.

For this purpose, the Technical Education and Skills Development Authority (TESDA), the Technology Livelihood Resource Center (TLRC), and other government agencies involved in training and livelihood development shall give priority to return who had been employed as domestic helpers and entertainers.

SEC. 18. FUNCTIONS OF THE RE-PLACEMENT AND MONITORING CENTER. - The center shall provide the following service:

(a) Develop livelihood programs and projects for returning Filipino migrant workers in coordination with the private sector;

(b) Coordinate with appropriate private and government agencies the promotion, development, re-placement and the full utilization of their potentials;

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(c) Institute in cooperation with other government agencies concerned, a computer-based information system on skilled Filipino migrant workers which shall be accessible to all local recruitment agencies and employers, both public and private;

(d) Provide a periodic study and assessment of job opportunities for returning Filipino migrant workers.

SEC. 19. ESTABLISHMENT OF A MIGRANT WORKERS AND OTHER OVERSEAS FILIPINOS RESOURCE CENTER. - Within the premises and under the administrative jurisdiction of the Philippine Embassy in countries where there are large concentrations of Filipino migrant workers, there shall be establish a Migrant Workers and Other Overseas Filipinos Resource Center with the following services:

(a) Counseling and legal services;

(b) Welfare assistance including the procurement of medical and hospitalization services;

(c) Information, advisory and programs to promote social integration such as post-arrival orientation, settlement and community networking services for social integration;

(d) Institute a scheme of registration of undocumented workers to bring them within the purview of this Act. For this purpose, the Center is enjoined to compel existing undocumented workers to register with it within six (6) months from the effectivity of this Act, under pain of having his/her passport cancelled;

(e) Human resource development, such as training and skills upgrading;

(f) Gender sensitive programs and activities to assist particular needs of women migrant workers;

(g) Orientation program for returning workers and other migrants; and

(h) Monitoring of daily situations, circumstances and activities affecting migrant workers and other overseas Filipinos.

The establishment and operations of the Center shall be a joint undertaking of the various government agencies. The Center shall be open for twenty-four (24) hours daily, including Saturdays, Sundays and holidays, and shall be staffed by Foreign Service personnel, service attaches or officers who represent other organizations from the host countries. In countries categorized as highly problematic by the Department of Foreign Affairs and the Department of Labor and Employment and where there is a concentration of Filipino migrant workers, the government must provide a lawyer and a social worker for the Center. The Labor Attache shall coordinate the operation of the Center and shall keep the Chief of Mission informed and updated on all matters affecting it.

The Center shall have a counterpart 24-hour information and assistance center at the Department of Foreign Affairs to ensure a continuous network and coordinative mechanism at the home office.

SEC. 20. ESTABLISHMENT OF A SHARED GOVERNMENT INFORMATION SYSTEM FOR MIGRATION. - An inter-agency committee composed of the Department of Foreign Affairs and its attached agency, the Commission on Filipino Overseas, the Department of Labor and Employment, the Philippine Overseas Employment Administration, The Overseas Workers Welfare Administration, The Department of Tourism, the Department of Justice, the Bureau of Immigration, the National Bureau of Investigation, and the National Statistics Office shall be established to implement a shared government information system for migration. The inter-agency committee shall initially make available to itself the information contained in existing data bases/files. The second phase shall involve linkaging of computer facilities in order to allow free-flow data exchanges and sharing among concerned agencies.

The inter-agency committee shall convene to identify existing data bases which shall be declassified and shared among member agencies. These shared data bases shall initially include, but not limited to, the following information:

(a) Masterlists of departing/arriving Filipinos;

(b) Inventory of pending legal cases involving Filipino migrant workers and other Filipino nationals, including those serving prison terms;

(c) Masterlists of departing/arriving Filipinos;

(d) Statistical profile on Filipino migrant workers/overseas Filipinos/Tourists;

(e) Blacklisted foreigners/undesirable aliens;

(f) Basic data on legal systems, immigration policies, marriage laws and civil and criminal codes in receiving countries particularly those with the large numbers of Filipinos;

(g) List of labor and other human rights instruments where receiving countries are signatories;

(h) A tracking system of past and present gender disaggregated cases involving male and female migrant workers; and

(I) Listing of overseas posts which may render assistance to overseas Filipinos, in general, and migrant workers, in particular.

SEC. 21. MIGRANT WORKERS LOAN GUARANTEE FUND. - In order to further prevent unscrupulous illegal recruiters from taking advantage of workers seeking employment abroad, the OWWA, in coordination with government financial institutions, shall institute financing schemes that will expand the grant of pre-departure loan and family assistance loan. For this purpose, a Migrant Workers Loan Guarantee Fund is hereby created and the revolving amount of one hundred million pesos (P100,000,000.00) from the OWWA is set aside as a guarantee fund in favor of participating government financial institutions.

SEC. 22. RIGHTS AND ENFORCEMENT MECHANISM UNDER INTERNATIONAL AND REGIONAL HUMAN RIGHTS SYSTEMS. - The Department of Foreign Affairs is mandated to undertake the necessary initiative such as promotions, acceptance or adherence of countries receiving Filipino workers to multilateral convention, declaration or resolutions pertaining to the protection of migrant workers' rights. The Department of Foreign Affairs is also mandated to make an assessment of rights and avenues of redress under international and regional human rights systems that are available to Filipino migrant workers who are victims of abuse and violation and, as far as practicable and through the Legal Assistant for Migrant Workers Affairs created under this Act, pursue the same on behalf of the victim if it is legally impossible to file individual complaints. If a complaints machinery is available under international or regional systems, the Department of Foreign Affairs shall fully apprise the Filipino migrant workers of the existence and effectiveness of such legal options.

IV. GOVERNMENT AGENCIES

SEC. 23. ROLE OF GOVERNMENT AGENCIES. - The following government agencies shall perform the following to promote the welfare and protect the rights of migrant workers and, as far as applicable, all overseas Filipinos:

(a) Department of Foreign Affairs. - The Department, through its home office or foreign posts, shall take priority action its home office or foreign posts, shall take priority action or make representation with the foreign authority concerned to protect the rights of migrant workers and other overseas Filipinos and extend immediate assistance including the repatriation of distressed or beleaguered migrant workers and other overseas Filipinos;

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(b) Department of Labor and Employment - The Department of Labor and Employment shall see to it that labor and social welfare laws in the foreign countries are fairly applied to migrant workers and whenever applicable, to other overseas Filipinos including the grant of legal assistance and the referral to proper medical centers or hospitals:

(b.1) Philippine Overseas Employment Administration - Subject to deregulation and phase out as provided under Sections 29 and 30 herein, the Administration shall regulate private sector participation in the recruitment and overseas placement of workers by setting up a licensing and registration system. It shall also formulate and implement, in coordination with appropriate entities concerned, when necessary employment of Filipino workers taking into consideration their welfare and the domestic manpower requirements.

(b.2) Overseas Workers Welfare Administration - The Welfare Officer or in his absence, the coordinating officer shall provide the Filipino migrant worker and his family all the assistance they may need in the enforcement of contractual obligations by agencies or entities and/or by their principals. In the performance of this functions, he shall make representation and may call on the agencies or entities concerned to conferences or conciliation meetings for the purpose of settling the complaints or problems brought to his attention.

V. THE LEGAL ASSISTANT FOR MIGRANT WORKERS AFFAIRS

SEC. 24. LEGAL ASSISTANT FOR MIGRANT WORKERS AFFAIRS. - There is hereby created the position of Legal Assistant for Migrant Workers Affairs under the Department of Foreign Affairs who shall be primarily responsible for the provision and overall coordination of all legal assistance services to be provided to Filipino migrant workers as well as overseas Filipinos in distress. He shall have the rank, salary and privileges equal to that of an undersecretary of said Department.

The said Legal Assistant for Migrant Workers Affairs shall be appointed by the President and must be of proven competence in the field of law with at least ten (10) years of experience as a legal practitioner and must not have been a candidate to an elective office in the last local or national elections.

Among the functions and responsibilities of the aforesaid Legal Assistant are:

(a) To issue the guidelines, procedures and criteria for the provisions of legal assistance services to Filipino migrant workers;

(b) To establish close linkages with the Department of Labor and Employment, the POEA, the OWWA and other government agencies concerned, as well as with non-governmental organizations assisting migrant workers, to ensure effective coordination and cooperation in the provision of legal assistance to migrant workers;

(c) To tap the assistance of reputable law firms and the Integrated Bar of the Philippines and other bar associations to complement the government's efforts to provide legal assistance to migrant workers;

(d) To administer the legal assistance fund for migrant workers established under Section 25 hereof and to authorize disbursements there from in accordance with the purposes for which the fund was set up; and

(e) To keep and maintain the information system as provided in Section 20.

The legal Assistant for Migrant Workers Affairs shall have authority to hire private lawyers, domestic or foreign, in order to assist him in the effective discharge of the above functions.

SEC. 25. LEGAL ASSISTANCE FUND - There is hereby established a legal assistance fund for migrant workers, herein after referred to as Legal Assistance fund, in the amount of One hundred million pesos (P100,000,000.00) to be constituted from the following sources:

Fifty million pesos (P50,000,000.00) from the Contingency Fund of the President;

Thirty million pesos (P30,000,000.00) from the Presidential Social Fund; and

Twenty million pesos (P20,000,000.00) from the Welfare Fund for Overseas Workers established under Letter of Instruction No. 537, as amended by Presidential Decree Nos. 1694 and 1809.

Any balances of existing fund which have been set aside by the government specifically as legal assistance or defense fund to help migrant workers shall, upon effectivity of this Act, to be turned over to, and form part of, the Fund created under this Act.

SEC. 26. USES OF THE LEGAL ASSISTANCE FUND. - The Legal Assistance Fund created under the preceeding section shall be used exclusively to provide legal services to migrant workers and overseas Filipinos in distress in accordance witht the guidelines, criteria and procedures promulgated in accordance with Section 24 (a) hereof. The expenditures to be charged against the Fund shall include the fees for the foreign lawyers to be hired by the Legal Assistance for Migrant Workers Affairs to represent migrant workers facing charges abroad, bail bonds to secure the temporary release of workers under detention, court fees and charges and other litigation expenses.

VI. COUNTRY - TEAM APPROACH

SEC. 27. PRIORITY CONCERNS OF PHILIPPINE FOREIGN SERVICE POSTS. - The country team approach, as enunciated under Executive Order No. 74, series of 1993, shall be the mode under which Philippine embassies or their personnel will operate in the protection of the Filipino migrant workers as well as in the promotion of their welfare. The protection of the Filipino migrant workers and the promotion of their welfare, in particular, and the protection of the dignity and fundamental rights and freedoms of the Filipino citizen abroad, in general, shall be the highest priority concerns of the Secretary of Foreign Affairs and the Philippine Foreign Service Posts.

SEC. 28. COUNTRY-TEAM APPROACH. - Under the country-team approach, all officers, representatives and personnel of the Philippine government posted abroad regardless of their mother agencies shall, on a per country basis, act as one country-team with a mission under the leadership of the ambassador. In this regard, the ambassador may recommend to the Secretary of the Department of Foreign Affairs the recall of officers, representatives and personnel of the Philippine government posted abroad for acts inimical to the national interest such as, but not limited to, failure to provide the necessary services to protect the rights of overseas Filipinos.

Upon receipt of the recommendation of the ambassador, the Secretary of the Department of Foreign Affairs shall, in the case of officers, representatives and personnel of other departments, endorse such recommendation to the department secretary concerned for appropriate action. Pending investigation by an appropriate body in the Philippines, the person recommended for recall may be placed under preventive suspension by the ambassador.

In host countries where there are Philippine consulates, such consulates shall also constitute part of the country-team under the leadership of the ambassador.

In the implementation of the country-team approach, visiting Philippine delegations shall be provided full support and information.

VII. DEREGULATION AND PHASE-OUT

SEC. 29. COMPREHENSIVE DEREGULATION PLAN ON RECRUITMENT ACTIVITIES. - Pursuant to a progressive policy of deregulation whereby the migration of workers becomes strictly a matter between the worker and his foreign employer, the DOLE within one (1) year from the effectivity of this Act, is hereby mandated to formulate a five-year comprehensive deregulation plan on recruitment activities taking into account labor market trends, economic conditions

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of the country and emergency circumstances which may affect the welfare of migrant workers.

SEC. 30. GRADUAL PHASE-OUT OF REGULATORY FUNCTIONS. - Within a period of five (5) years from the effectivity of this Act, the DOLE shall phase out the regulatory functions of the POEA pursuant to the objectives of deregulation.

VII. PROFESSIONAL AND OTHER HIGHLY-SKILLED FILIPINOS ABROAD

SEC. 31. INCENTIVES TO PROFESSIONALS AND OTHER HIGHLY-SKILLED FILIPINOS ABROAD. - Pursuant to the objective of encouraging professionals and other highly-skilled Filipinos abroad especially in the field of science and technology to participate in, and contribute to national development, the government shall provide proper and adequate incentives and programs so as to secure their services in priority development areas of the public and private sectors.

IX. MISCELLANEOUS PROVISIONS

SEC. 32. POEA AND OWWA BOARD; ADDITIONAL MEMBERSHIPS. - Notwithstanding any provision of law to the contrary, the respective Boards of the POEA and the OWWA shall, in addition to their present composition, have three (3) members each who shall come from the women, sea-based and land-based sectors, respectively, to be appointed by the President in the same manner as the other members.

SEC. 33. REPORT TO CONGRESS. - In order to inform the Philippine Congress on the implementation of the policy enunciated in Section 4 hereof, the Department of Foreign Affairs and the Department of Labor and Employment shall submit to the said body a semi-annual report of Philippine foreign posts located in countries hosting Filipino migrant workers. The report shall not be limited to the following information:

(a) Masterlist of Filipino migrant workers, and inventory of pending cases involving them and other Filipino nationals including those serving prison terms;

(b) Working conditions of Filipino migrant workers;

(c) Problems encountered by the migrant workers, specifically violations of their rights;

(d) Initiative/actions taken by the Philippine foreign posts to address the problems of Filipino migrant workers;

(e) Changes in the laws and policies of host countries; and

(f) Status of negotiations on bilateral labor agreements between the Philippines and the host country.

Any officer of the government who fails to report as stated in the preceeding section shall be subjected to administrative penalty.

SEC. 34. REPRESENTATION IN CONGRESS. - Pursuant to Section 3(2), Article VI of the Constitution and in line with the objective of empowering overseas Filipinos to participate in the policy-making process to address Filipino migrant concerns, two (2) sectoral representatives for migrant workers in the House of Representatives shall be appointed by the President from the ranks of migrant workers: Provided, that at least one (1) of the two (2) sectoral representatives shall come from the women migrant workers sector: Provided, further, that all nominees must have at least two (2) years experience as a migrant worker.

SEC. 35. EXEMPTION FROM TRAVEL TAX AND AIRPORT FEE. - All laws to the country notwithstanding, the migrant worker shall be exempt from the payment of travel tax and airport fee upon proper showing of proof of entitlement by the POEA.

SEC. 36. NON-INCREASE OF FEES; ABOLITION OF REPATRIATION BOND. - Upon approval of this Act, all fees being charged by any government office on migrant workers shall remain at their present levels and the repatriation bond shall be established.

SEC. 37. THE CONGRESSIONAL MIGRANT WORKERS SCHOLARSHIP FUND. - There is hereby created a Congressional Migrant Workers Scholarship Fund which shall benefit deserving migrant workers and/or their immediate descendants below twenty-one (21) years of age who intent to pursue courses or training primarily in the field of science and technology. The initial seed fund of two hundred million pesos (P200,000,000.00) shall be constituted from the following sources:

(a) Fifty million pesos (P50,000,000.00) from the unexpected Countrywide Development Fund for 1995 in equal sharing by all members of Congress; and

(b) The remaining one hundred fifty million pesos (P150,000,000.00) shall be funded from the proceeds of Lotto.

The Congressional Migrant Workers Scholarship Fund as herein created shall be administered by the DOLE in coordination with the Department of Science and Technology (DOST). To carry out the objectives of this section, the DOLE and the DOST shall formulate the necessary rules and regulations.

SEC. 38. APPROPRIATION AND OTHER SOURCES OF FUNDING. - The amount necessary to carry out the provisions of this Act shall be provided for in the General Appropriations Act of the year following its enactment into law and thereafter.

SEC. 39. MIGRANT WORKERS DAY. - The day of signing by the President of this Act shall be designated as the Migrant Workers Day and shall henceforth be commemorated as such annually.

SEC. 40. IMPLEMENTING RULES AND REGULATIONS. - The departments and agencies charged with carrying out the provisions of this Act shall, within ninety (90) days after the effectivity of this Act, formulate the necessary rules and regulations for its effective implementation.

SEC. 41. REPEATING CLAUSE. - All laws, decrees, executive orders, rules and regulations, or parts thereof inconsistent with the provisions of this Act are hereby repealed or modified accordingly.

SEC. 42. SEPARABILITY CLAUSE. - If, for any reason, any section or provision of this Act is held unconstitutional or invalid, the other sections or provisions hereof shall not be affected thereby.

SEC. 43. EFFECTIVITY CLAUSE. - This Act shall take effect after fifteen (15) days from its publication in the Official Gazette or in at least two (2) national newspapers of general circulation whichever comes earlier.

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199072783 labor-case1

Education

Transcript of 199072783 labor-case1