Labor Cases 12 - Digest.docx

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Century Textile Mills v. Escaño (P) v. NLRC & Calangi | GR No.

!"# | ".$".!! | Ter%ination o E%'loy%ent Proceure |

*eliciano+ , '-

• Since 12.74, R was employed by P as a Machine Operator. On 6.8,

he was placed !nder pre"enti"e s!spension, and on 7.27.8,

terminated, ha"in# been acc!sed o$ plottin# criminal acts a#ainst 2o$ his s!per"isors, by poisonin# thr! water, a criminal complaint was

also instit!ted a#ainst R.• S!in#% alle#in# he was not $!rnished him copy o$ char#es% nor

a&orded him opport!nity to answer.• '( )ismissed, holdin# that the e"idence was o"erwhelmin# and

s!*cient to +!sti$y Ps actions% R $ailin# to contro"ert. 'R- Re"ersed,

hence this.

• (/RM0). R was e&ecti"ely denied his ri#ht to d!e process in that,prior to his pre"enti"e s!spension and the termination o$ his

ser"ices, he had not been #i"en the opport!nity either to a*rm or

re$!te the char#es pro$erred a#ainst him.• he win3 re!irement o$ notice is intended to in$orm the employee

concerned o$ the employer5s intent to dismiss and the reason $or the

proposed dismissal% !pon the other hand, the re!irement o$ hearin#

a&ords the employee an opport!nity to answer his employer5s

char#es a#ainst him and accordin#ly to de$end himsel$ there$rombe$ore dismissal is e&ected.

• hose ri#hts were not satised by petitioner -orporation5s obtainin#

the consent o$ or cons!ltin# with the labor !nion% s!ch cons!ltation

or consent was not a s!bstit!te $or act!al obser"ance o$ those ri#hts

o$ pri"ate respondent -alan#i.• he employee can wai"e those ri#hts, i$ he so chooses, b!t the !nion

cannot wai"e them $or him. hat the pri"ate respondent simply ept

silent all the while, is not ade!ate to show an e&ecti"e wai"er o$ his ri#hts.

• R is, as a matter o$ ri#ht, entitled to recei"e both types o$ relie$

made a"ailable in (rticle 289 o$ the 'abor -ode, as amended. /t

matters not that R had omitted in his complaint led in -ase o.

'R-:-R:19:4;18:8 a claim $or reinstatement witho!t loss o$

seniority ri#hts $or he is entitled to s!ch relie$ as the $acts alle#ed

and pro"ed warrant.

• <!t P-o sho!ld not be compelled to tae bac in its $old anemployee who, at least in the minds o$ his employers, poses a

si#nicant threat to the li"es and sa$ety o$ company worers.



-onse!ently, we hold that pri"ate respondent sho!ld be #i"en his

separation pay in lie! o$ s!ch reinstatement.



/iera (P) v. NLRC & Planters 0an1 | GR No. 23$3$4 | 22.5.#$ |

Ter%ination o E%'loy%ent Proceure | Cru6+ , '-

• (s a Mana#er o$ R-o <an3, was dismissed on 4.28.87 on the

#ro!nd o$ loss o$ condence. he ban was bein# a!dited by the

=ead O*ce, at the same time P led $or a "acation lea"e to tae a

m!ch needed rest. >pon his ret!rn, he recei"ed a memo re!irin#him to answer the a!dit report, s!##estin# his participation in some

"iolations prohibited in the <ans -ode o$ )iscipline% ? was not

allowed to ret!rn to wor. =e was ad"ised to appear be$ore the

in"esti#atin# committee also, he wai"ed the assistance o$ co!nsel

on said committee in"esti#ation.• P on the other hand denies the a$ore!oted. =e was then

pre"enti"ely s!spended on 1.12.87. ormally protestin#, a"errin#

that the in"esti#ation was de$ecti"e. ( $ollow:!p list o$ ndin#s o$ irre#!larities was $o!nd by the committee, he re$!ted, the

committee then s!bmitted a recommendation $or dismissal, w@c was

eAec!ted by R-o.• '( r!led $or P% 'R- re"ersed% hence this.

• )/SM/SS0). Be do not a#ree. Be hold that the rst element was not

"iolated beca!se the petitioner was d!ly notied o$ the Specication

o$ -har#es and in"ited to appear at the hearin# sched!led $or their

in"esti#ation. =e was e"en ad"ised to brin# a lawyer with him i$ heso desired.

• he re!irement $or hearin# was also obser"ed. he petitioner

cannot say he was depri"ed o$ this ri#ht beca!se the record shows

he was d!ly a&orded ample opport!nity to de$end himsel$ and

introd!ce e"idence on his behal$. (mple opport!nity connotes

e"ery ind o$ assistance that mana#ement m!st accord the

employee to enable him to prepare ade!ately $or his de$ense,

incl!din# le#al representation. (biera says he belie"ed that thehearin# to which he was in"ited was only preliminary and so wo!ld

not re!ire the presence o$ his lawyer. 0"en so, he was not

precl!ded $rom asin# $or the s!spension o$ that hearin# a$ter he

realiCed that he was already bein# #rilled, as he p!t it, in a $ormal

in"esti#ation.• /t is also not tr!e that the petitioner had not been #i"en a chance to

de$end himsel$. he established $act is that he did this "erbally and

thro!#h written replies to the internal a!dit report and the additionalchar#e a#ainst him. he -o!rt especially notes his point:by:point

re$!tation dated September 18, 1D86, =is eAplanation was !ite



detailed and belies his claim that he was not #i"en access to the

pri"ate respondent5s records.• ( $ormal trial:type hearin# is not at all times and in all instances

essential to d!e process. /t is eno!#h that the parties are #i"en a $air

and reasonable opport!nity to eAplain their respecti"e sides o$ the

contro"ersy and to present s!pportin# e"idence on which a $air

decision can be based. -aselaw3 this type o$ hearin# is not e"en

mandatory in cases o$ complaints lod#ed be$ore the 'abor (rbiter.

(ltho!#h the a$oresaid in"esti#ations were not cond!cted in the

manner o$ a re#!lar trial in co!rt, the elements o$ d!e process,

namely, the ri#ht to be in$ormed o$ the char#es, to be present and to

be heard, were accorded petitioners. /n said in"esti#ations,

petitioners $reely and "ol!ntarily answered the !estions and e"en

made $!rther statements in their de$ense d!rin# the concl!din#

sta#es thereo$. )!e process as a constit!tional precept does not,

always and in all sit!ations, re!ire trial:type proceedin#s. he

essence o$ d!e process is to be $o!nd in the reasonable opport!nity

to be heard and to s!bmit any e"idence one may ha"e in s!pport o$

one5s de$ense. o be heard does not only mean "erbal ar#!ments

in co!rt. One may be heard also thro!#h pleadin#s.• he parties co!ld ha"e held a trial:type hearin#, b!t they decided

instead to s!bmit the case $or decision on the basis o$ the position

papers, doc!mentary e"idence and other pleadin#s already

s!bmitted be$ore the 'abor (rbiter. his arran#ement was m!t!ally

a#reed !pon by them d!rin# the hearin# held on E!ly 27, 1D8D, and

is a!thoriCed !nder (rticle 221 o$ the 'abor -ode. /t is tr!e that the

ri#ht o$ con$rontation is embraced in d!e process and that the

petitioner did demand the appearance o$ the internal a!ditors so he

co!ld cross:eAamine them. /t is also tr!e that this demand was

re+ected by the /n"esti#atin# -ommittee. e"ertheless, the

petitioner saw t not to insist on this ri#ht and in $act s!bse!ently

wai"ed it when he a#reed at the said hearin# on the abo"e:

disc!ssed proced!re.• Re#ardin# the #ro!nd $or his dismissal, his cond!ct ca!sed the

pri"ate respondent to lose condence in his +!d#ment and e"en his

inte#rity and pro"ided the +!st ca!se $or his dismissal as branch

mana#er. (rticle 282c3 o$ the 'abor -ode plainly statesF (rt. 282.

ermination by employer. G (n employer may terminate anemployment $or any o$ the $ollowin# ca!sesF . . . c3 ra!d or will$!l

breach by the employee o$ the tr!st reposed in him by his employer

or d!ly a!thoriCed representati"e.



7el Monte P8ils. & 0alanra (P) v. 9alivar et al.+ (R) | GR No.

2"!5$3 | 23.22.35 | Ter%ination o E%'loy%ent Proceure |

Tinga+ ,+ '-

• Bhether there was s!*cient ca!se $or the dismissal o$ a ran:and:

le employee e&ect!ated thro!#h the en$orcement o$ a closed:shop

pro"ision in a -<(.• he (ssociated 'abor >nion ('>3 is the eAcl!si"e bar#ainin# a#ent

o$ plantation worers o$ P-o. R imbal3 as a ran:and:le employee

o$ P-o. ( -<( was entered into by ('> and P-o.• Rs were char#ed $or disloyalty to the !nion, $or s!pposedly

con"incin# others to +oin a contra >nion, this alle#ation was

s!pported by the statement o$ a certain (rta+o. R answered the

board ('>3 cond!ctin# the in"esti#ation, denyin# the alle#ations,

p!rportedly moti"ated by hate and re"en#e a#ainst her.• he board $o!nd R #!ilty o$ partisan acti"ities, w@c is prohibited since

the H$reedom periodI has yet to commence then% liewise in

accordance with the Sec!rity cla!se in the -<(, P-o dismissed her.• '( $a"o!red Rs, 'R- re"ersed. On re"iew -( $o!nd that only R

imbal was ille#ally dismissed, ndin# $ail!re to obser"e proced!ral

d!e process. =ence this petition led by the other Rs.• )enied. (*rmed. L:;s sole <itness against 8er+ s8oul not /e

given <eig8t /ecause rta=o 8a an ax>e? to grin at t8eti%e <8en s8e %ae t8e averse state%ents against 8er.

imbal5s dismissal is not predicated on any o$ the +!st or a!thoriCed

ca!ses $or dismissal !nder <oo SiA, itle / o$ the 'abor -ode, b!t on

the !nion sec!rity cla!se in the -<( between )el Monte and ('>.

Stip!lations in the -<( a!thoriCin# the dismissal o$ employees are o$

e!al import as the stat!tory pro"isions on dismissal !nder the

'abor -ode, since JaK -<( is the law between the company and the

!nion and compliance therewith is mandated by the eApress policyto #i"e protection to labor.

• ( closed:shop may be dened as an enterprise in which, by

a#reement between the employer and his employees or their

representati"es, no person may be employed in any or certain

a#reed departments o$ the enterprise !nless he or she is, becomes,

and, $or the d!ration o$ the a#reement, remains a member in #ood

standin# o$ a !nion entirely comprised o$ or o$ which the employees

in interest are a part. ( -<( pro"ision $or a closed:shop is a "alid$orm o$ !nion sec!rity and it is not a restriction on the ri#ht or

$reedom o$ association #!aranteed by the -onstit!tion.



$rom the necessity to d!ly establish the eAistence o$ s!ch #ro!nds

be$ore the dismissal may be "alidated. (nd e"en i$ the employer or,

in this case, the collecti"e bar#ainin# a#ent, is satised that ca!se

has been established to warrant the dismissal, suc8 satisaction

<ill /e o no conseAuence i+ u'on legal c8allenge+ t8ey are

una/le to esta/lis8 /eore t8e NLRC or t8e courts t8e

'resence o suc8 causes.• -onsiderin# that the ci"il complaint was led +!st siA 63 days prior

to the eAec!tion o$ (rta+o5s a*da"it a#ainst imbal, it wo!ld be

plainly in+!dicio!s to pres!me that (rta+o possessed an !nbiased

state o$ mind as she eAec!ted that a*da"it. S!ch circ!mstance was

considered by the 'abor (rbiter, and especially the -o!rt o$ (ppeals,

as they rendered a $a"orable r!lin# to imbal. he 'R- may ha"e

decided a#ainst (rta+o, b!t in doin# so, it $ailed to pro"ide any basis

as to why (rta+o5s testimony sho!ld be belie"ed, instead o$

disbelie"ed. • (ltho!#h )el Monte claims be$ore this -o!rt that Pi!ero had

corroborated (rta+o5s claims d!rin# s!ch testimony, positi"ely

identied Jimbal5sK presence in the ' seminar on 14 E!ly 1DD2,

and conrmed that imbal #a"e (rta+o P;99.99 $or recr!itin#

participants in the ' seminar. hese transcripts were not taen

d!rin# a hearin# cond!cted by any p!blic o*ce in the Philippines,

b!t they were committed in the co!rse o$ an internal disciplinary

mechanism de"ised by a pri"ately or#aniCed labor !nion. >nless the

a!thenticity o$ these notes is d!ly pro"en be$ore, and appreciated by

the triers o$ $act, we cannot accord them any pres!mpti"e or

concl!si"e "al!e.



Bing o Bings Trans'ort+ 7ela *uente+ & Li% (P) v. Ma%ac (R) |

GR No. 255$3! | 5.$#.3 | Ter%ination o E%'loy%ent Proceure

| Delasco+ ,r.+ , '-

• (s a cond!ctor and >nion 'eader3. One o$ his d!ties is to s!bmit a

rip Report indicates ticet openin# and closin# $or each trip L

(cco!ntin# o$ earnin#s3. On 19.8.91 a discrepancy PhP.89D.993 was$o!nd, ased to eAplain, he held that they enco!ntered an accident

and erroneo!sly #a"e a wron# report, $or they had to c!t short their

trip $or them to report to the police.• On 11.26.91, he recei"ed a termination letter e&ecti"e 11.2D.91,

alle#in# $ra!d on said report, citin# other o&enses alle#edly

committed since 1DDD. -laimin# that his dismissal was e&ected

witho!t d!e process, he s!ed. '( dismissed his complaint. 'R-

Modied to indemni$y only3 $or $ailin# to comply w@ d!e processprior to termination. -( a*rms, holdin# that there is +!st ca!se $or

dismissal )eclarin# sold ticets as ret!rned ticets constit!ted

$ra!d3. =ence this. /s a "erbal appraisal o$ the char#es a breach o$

the proced!ral d!e process• P(R'N R(0). Only /ndemnity. )!e process !nder the 'abor

-ode in"ol"es two aspectsF rst, s!bstanti"e G the "alid and

a!thoriCed ca!ses o$ termination o$ employment !nder the 'abor

-ode% and second, proced!ral G the manner o$ dismissal. irst,respondent was not iss!ed a written notice char#in# him o$

committin# an in$raction. he law is clear on the matter. ( "erbal

appraisal o$ the char#es a#ainst an employee does not comply with

the rst notice re!irement. • -ons!ltations or con$erences are not a s!bstit!te $or the act!al

obser"ance o$ notice and hearin#. he employee5s written

eAplanation did not eAc!se the $act that there was a complete

absence o$ the rst notice.• Second, e"en ass!min# that petitioner / was able to $!rnish

respondent an /rre#!larity Report noti$yin# him o$ his o&ense, s!ch

wo!ld not comply with the re!irements o$ the law. Be obser"e $rom

the irre#!larity reports a#ainst respondent $or his other o&enses that

s!ch contained merely a #eneral description o$ the char#es a#ainst

him. he reports did not e"en state a company r!le or policy that the

employee had alle#edly "iolated. 'iewise, there is no mention o$

any o$ the #ro!nds $or termination o$ employment !nder (rt. 282 o$ the 'abor -ode. h!s, /5s standard char#e sheet is not s!*cient

notice to the employee.



• hird, no hearin# was cond!cted. Re#ardless o$ respondent5s written

eAplanation, a hearin# was still necessary in order $or him to clari$y

and present e"idence in s!pport o$ his de$ense. Moreo"er,

respondent made the letter merely to eAplain the circ!mstances

relatin# to the irre#!larity in his October 28, 2991 -ond!ctor5s rip

Report. =e was !naware that a dismissal proceedin# was already

bein# e&ected. h!s, he was s!rprised to recei"e the o"ember 26,

2991 termination letter indicatin# as #ro!nds, not only his October

28, 2991 in$raction, b!t also his pre"io!s in$ractions.

en'8il (P) v. NLRC & Mallare (R) | GR No. !3"! | $.!.!# |

Ter%ination ga/on 7octrine | Gancayco+ , '-

• R was c!rrently then a <acroom )epartment (ssistant head o$ P in

-!bao Resta!rant3. On ;.29.8;, he and <arrameda had analtercation, d!e to which they were s!spended and R was

immediately ;.2;.8;3 dismissed, in accordance w@ their Personnel

Man!al. J-irc!mstanceF ( mis!nderstandin# on tendin# the Salad

<ar, #ht ens!ed% ased to report, re$!sed, S bro!#ht R to the

Mana#er, instead o$ eAplainin#, sho!ted pro$ane words% R wanted

the iss!e settled in between them only% Mana#er iss!ed s!spension

!ntil $!rther notice% Only R was dismissed.K•

'( dismissed. 'R- re"ersed. =ence this a restrainin# order was#ranted by S-3.

• ranted. Re"ersed and Set (side. he deant attit!de o$ pri"ate

respondent immediately a$ter the incident amo!nted to

ins!bordination. e"ertheless his re$!sal to eAplain his side !nder

the circ!mstances cannot be considered as a wai"er o$ his ri#ht to

an in"esti#ation.• (ltho!#h in the Personnel Manual o$ the petitioner, it states that

an errin# employee m!st re!est $or an in"esti#ation it does notthereby mean that petitioner is thereby relie"ed o$ the d!ty to

cond!ct an in"esti#ation be$ore dismissin# pri"ate respondent.

/ndeed said pro"ision o$ the Personnel Man!al o$ petitioner which

may e&ecti"ely depri"e its employees o$ the ri#ht to d!e process is

clearly against t8e la< an 8ence null an voi. • >nder Section 1, R!le Q/ o$ the /mplementin# Re#!lations o$ the

'abor -ode, it is pro"ided that o worer shall be dismissed eAcept

$or +!st or a!thoriCed ca!se pro"ided by law and a$ter d!e processSections 2, ;, 6, and 7 o$ the same r!les re!ire that be$ore an

employer may dismiss an employee the latter m!st be #i"en a

written notice statin# the partic!lar act or omission constit!tin# the



#ro!nds thereo$% that the employee may answer the alle#ations

within a reasonable period% that the employer shall a&ord him ample

opport!nity to be heard and to de$end himsel$ with the assistance o$

his representati"e, i$ he so desires% and that it is only then that the

employer may dismiss the employee by noti$yin# him o$ the decision

in writin# statin# clearly the reasons there$or. S!ch dismissal is

witho!t pre+!dice to the ri#ht o$ the employee to contest its "alidity

in the Re#ional <ranch o$ the 'R-.• he claim o$ petitioner that a $ormal in"esti#ation was not necessary

beca!se the incident which #a"e rise to the termination o$ pri"ate

respondent was witnessed by his co:employees and s!per"isors is

witho!t merit. he basic re!irement o$ d!e process is that which

hears be$ore it condemns, which proceeds !pon in!iry and renders

+!d#ment only a$ter trial. • =owe"er, it is a matter o$ $act that when the pri"ate respondent led

a complaint a#ainst petitioner he was a&orded the ri#ht to an

in"esti#ation by the labor arbiter. =e presented his position paper as

did the petitioner. /$ no hearin# was had, it was the $a!lt o$ pri"ate

respondent as his co!nsel $ailed to appear at the sched!led

hearin#s. he labor arbiter concl!ded that the dismissal o$ pri"ate

respondent was $or +!st ca!se. =e was $o!nd #!ilty o$ #ra"e

miscond!ct and ins!bordination. his is borne by the sworn

statements o$ witnesses. he -o!rt is bo!nd by this ndin# o$ the

labor arbiter.• (ltho!#h belatedly, pri"ate respondent was a&orded d!e process

be$ore the labor arbiter wherein the +!st ca!se o$ his dismissal had

been established. Bith s!ch ndin#, it wo!ld be arbitrary and !n$air

to order his reinstatement with bac wa#es.• h!s in the present case, where the pri"ate respondent, who

appears to be o$ "iolent temper, ca!sed tro!ble d!rin# o*ce ho!rs

and e"en deed his s!periors as they tried to paci$y him, sho!ld not

be rewarded with re:employment and bac wa#es. /t may enco!ra#e

him to do e"en worse and will render a mocery o$ the r!les o$

discipline that employees are re!ired to obser"e. >nder the

circ!mstances the dismissal o$ the pri"ate respondent $or +!st ca!se

sho!ld be maintained. =e has no ri#ht to ret!rn to his $ormer

employer.• =owe"er, the petitioner m!st ne"ertheless be held to acco!nt $or

$ail!re to eAtend to pri"ate respondent his ri#ht to an in"esti#ation

be$ore ca!sin# his dismissal. he r!le is eAplicit as abo"e disc!ssed.

he dismissal o$ an employee m!st be $or +!st or a!thoriCed ca!se



and a$ter d!e process. Petitioner committed an in$raction o$ the

second re!irement )>0 PRO-0SS3. h!s, it m!st be imposed a

sanction $or its $ail!re to #i"e a $ormal notice and cond!ct an

in"esti#ation as re!ired by law be$ore dismissin# petitioner $rom

employment. -onsiderin# the circ!mstances o$ this case petitioner

m!st indemni$y the pri"ate respondent the amo!nt o$ P1,999.99.



9errano (P) v. NLRC & F9ETNN 7e'art%ent 9tore (RCo) | GR No.

2233 | "..33 | Ter%ination ga/on 7octrine | Meno6a+ , '-

• P was notied o$ his termination e&ecti"e on the same date o$

receipt on the #ro!nd o$ retrenchment. =e contested the same and

led a complaint $or ille#al dismissal.

• he '( r!led in his $a"or $or $ail!re o$ respondent to pro"e thattermination was to pre"ent or minimiCe losses. =oldin# that

petitioner was not a&orded d!e process. 'R- Re"ersed, ndin# that

the termination was le#al b!t $ailed to address the iss!e o$

compliance with the notice re!irement.• S- a*rmed the decision o$ the 'R- and ordered the payment o$ $!ll

bacwa#es $or $ail!re to comply with the 9:day prior notice

re!irement.

• R-o mo"in# $or reconsideration, contening+ a%ong ot8ers+ t8at'ay%ent o t8e 43 ays 'ay is suHcient co%'liance <it8 t8e

43 ays 'rior notice an t8at t8e nonIo/servance o t8e

notice reAuire%ent s8oul not /e visite <it8 a severe

conseAuence. /nso$ar as it is ordered to pay petitioner $!ll

bacwa#es $rom the time the latter5s employment was terminated

$or $ail!re to #i"e petitioner a written notice o$ termination at least

thirty 93 days be$ore the termination o$ his employment as

re!ired by (rt. 28 the 'abor -ode.• )enied. he re!irement to #i"e a written notice o$ termination at

least thirty 93 days in ad"ance is a re!irement o$ the 'abor -ode.

othin# in the law #i"es pri"ate respondent the option to s!bstit!te

the re!ired prior written notice with payment o$ thirty 93 days

salary. /t is not $or pri"ate respondent to mae s!bstit!tions $or a

ri#ht that a worer is le#ally entitled to.• he p!rpose o$ s!ch pre"io!s notice is to #i"e the employee some

time to prepare $or the e"ent!al loss o$ his +ob as well as the )O'0the opport!nity to ascertain the "erity o$ the alle#ed a!thoriCed

ca!se o$ termination. S!ch p!rpose wo!ld not be ser"ed by the

simple eApedient o$ payin# thirty 93 days salary in lie! o$ notice o$

an employee5s impendin# dismissal, as by then the loss o$

employment wo!ld ha"e been a $ait accompli.• /n (ssociated 'abor >nions:/M-O> ". 'R-, the employees and

the then Ministry o$ 'abor and 0mployment MO'03 were notied in

writin# on (!#!st ;, 1D8 that the employees5 ser"ices wo!ld ceaseon (!#!st 1, 1D8 b!t that they wo!ld be paid their salaries and

other benets !ntil September ;, 1D8. /t was held that s!ch written



notice was more than s!bstantial compliance with the notice

re!irement o$ the 'abor -ode. =ad pri"ate respondent #i"en a

written notice to petitioner on October 1, 1DD1, at the latest, that

e&ecti"e October 1, 1DD1 his employment wo!ld cease altho!#h

$rom October 1 he wo!ld no lon#er be re!ired to wor, there wo!ld

be basis $or pri"ate respondent5s boast that JpaymentK o$ this salary

e"en Ji$ he isK no lon#er worin# is e&ecti"e notice and is m!ch

better than 9 days $ormal notice b!t worin# !ntil the end o$ the 9

days period. Bhat happened here was that on October 11, 1DD1,

petitioner was #i"en a memorand!m terminatin# his employment

e&ecti"e on the same day on the #ro!nd o$ retrenchment act!ally

red!ndancy3.• /t is contended that pri"ate respondent5s non:obser"ance o$ the

notice re!irement sho!ld not be "isited with a se"ere conse!ence

in accordance with (rt. ///, 1D13 o$ the -onstit!tion. he contention

is witho!t merit. (rt. ///, 1D13 o$ the -onstit!tion, prohibitin# the

imposition o$ eAcessi"e nes, applies only to criminal prosec!tions.• he order to pay $!ll bacwa#es is a conse!ence o$ the employer5s

action in dismissin# an employee witho!t notice which maes said

dismissal ine&ect!al. he employee is considered not to ha"e been

terminated $rom his employment !ntil it is nally determined that his

dismissal@termination o$ employment was $or ca!se and, there$ore,

he sho!ld be paid his salaries in the interim. his eliminates

#!esswor in determinin# the de#ree o$ pre+!dice s!&ered by an

employee dismissed with ca!se b!t witho!t notice since the penalty

is meas!red by the salary he $ailed to earn on acco!nt o$ his

dismissal@termination o$ employment.• he decision in -ol!mbia Pict!res does not mean that i$ a new r!le is

laid down in a case, it sho!ld not be applied in that case b!t that

said r!le sho!ld apply prospecti"ely to cases arisin# a$terwards.

Pri"ate respondent5s "iew o$ the principle o$ prospecti"e application

o$ new +!dicial doctrines wo!ld t!rn the +!dicial $!nction into a mere

academic eAercise with the res!lt that the doctrine laid down wo!ld

be no more than a dict!m and wo!ld depri"e the holdin# in the case

o$ any $orce.



ga/on (P) v. NLRC & Riviera Jo%e F%'rove%ents (R) | GR No.

2"!5#4 | 22.2.3 | Ter%ination ga/on 7octrine | KnaresI

9antiago+ , '-

• Ri"iera =ome /mpro"ements, /nc. Ri"iera3 is en#a#ed in the

b!siness o$ sellin# and installin# ornamental and constr!ction

materials. /t employed Ps as #yps!m board and cornice installers in1DD2 !ntil 1DDD when they were dismissed $or abandonment o$

wor.• wice in the d!ration o$ their employment, petitioners accepted wor

$or another company. =ence, there was abandonment o$ wor. /t

appears, howe"er, that Ri"iera $ailed to send the re!ired notices to

the petitioners to their last nown address $or the reason that it

wo!ld be !seless since petitioners do not reside there anymore. his

is a proced!ral inrmity which, nonetheless, sho!ld not in"alidatethe dismissal, contrary to the pre"ailin# b!t herein abandoned case

o$ Serrano ". 'R-. he employer was liable b!t only $or non:

compliance with the proced!ral re!irements o$ d!e process.• o dismiss an employee, the law re!ires not only the eAistence o$ a

+!st and "alid ca!se b!t also en+oins the employer to #i"e the

employee the opport!nity to be heard and to de$end himsel$.• (bandonment is the deliberate and !n+!stied re$!sal o$ an

employee to res!me his employment. /t is a $orm o$ ne#lect o$ d!ty,hence, a +!st ca!se $or termination o$ employment by the employer.

or a "alid ndin# o$ abandonment, these two $actors sho!ld be

presentF 13 the $ail!re to report $or wor or absence witho!t "alid or

+!stiable reason% and 23 a clear intention to se"er employer:

employee relationship, with the second as the more determinati"e

$actor which is mani$ested by o"ert acts $rom which it may be

ded!ced that the employees has no more intention to wor.

• he proced!re $or terminatin# an employee is $o!nd in <oo /, R!le/, Section 2 d3 o$ the Omnib!s R!les /mplementin# the 'abor -odeF

Standards o$ d!e processF re!irements o$ notice. or termination o$

employment based on +!st ca!ses as dened in (rticle 282 o$ the

-odeF a3 ( written notice ser"ed on the employee speci$yin# the

#ro!nd or #ro!nds $or termination, and #i"in# to said employee

reasonable opport!nity within which to eAplain his side% b3 (

hearin# or con$erence d!rin# which the employee concerned, with

the assistance o$ co!nsel i$ the employee so desires, is #i"enopport!nity to respond to the char#e, present his e"idence or reb!t

the e"idence presented a#ainst him% and c3 ( written notice o$



termination ser"ed on the employee indicatin# that !pon d!e

consideration o$ all the circ!mstances, #ro!nds ha"e been

established to +!sti$y his termination. /n case o$ termination, the

$ore#oin# notices shall be ser"ed on the employee5s last nown

address. • Proced!rally, 13 i$ the dismissal is based on a +!st ca!se !nder

(rticle 282, the employer m!st #i"e the employee two written

notices and a hearin# or opport!nity to be heard i$ re!ested by the

employee be$ore terminatin# the employmentF a notice speci$yin#

the #ro!nds $or which dismissal is so!#ht a hearin# or an

opport!nity to be heard and a$ter hearin# or opport!nity to be

heard, a notice o$ the decision to dismiss% and 23 i$ the dismissal is

based on a!thoriCed ca!ses !nder (rticles 28 and 284, the

employer m!st #i"e the employee and the )epartment o$ 'abor and

0mployment written notices 9 days prior to the e&ecti"ity o$ his

separation. T• rom the $ore#oin# r!les $o!r possible sit!ations may be deri"edF 13

the dismissal is $or a +!st ca!se !nder (rticle 282 o$ the 'abor -ode,

$or an a!thoriCed ca!se !nder (rticle 28, or $or health reasons

!nder (rticle 284, and d!e process was obser"ed% 23 the dismissal

is witho!t +!st or a!thoriCed ca!se b!t d!e process was obser"ed%

3 the dismissal is witho!t +!st or a!thoriCed ca!se and there was

no d!e process% and 43 the dismissal is $or +!st or a!thoriCed ca!se

b!t d!e process was not obser"ed. /n the rst sit!ation, the

dismissal is !ndo!btedly "alid and the employer will not s!&er any

liability. /n the second and third sit!ations where the dismissals are

ille#al, (rticle 27D mandates that the employee is entitled to

reinstatement witho!t loss o$ seniority ri#hts and other pri"ile#es

and $!ll bacwa#es, incl!si"e o$ allowances, and other benets or

their monetary e!i"alent comp!ted $rom the time the

compensation was not paid !p to the time o$ act!al reinstatement.

/n the $o!rth sit!ation, the dismissal sho!ld be !pheld. Bhile the

proced!ral inrmity cannot be c!red, it sho!ld not in"alidate the

dismissal. =owe"er, the employer sho!ld be held liable $or non:

compliance with the proced!ral re!irements o$ d!e process.• ( re"iew and re:eAamination o$ the rele"ant le#al principles is

appropriate and timely to clari$y the "ario!s r!lin#s on employment

termination in the li#ht o$ Serrano ". ational 'abor Relations-ommission. Be held that the "iolation by the employer o$ the

notice re!irement in termination $or +!st or a!thoriCed ca!ses was

not a denial o$ d!e process that will n!lli$y the termination. =owe"er,



the dismissal is ine&ect!al and the employer m!st pay $!ll

bacwa#es $rom the time o$ termination !ntil it is +!dicially declared

that the dismissal was $or a +!st or a!thoriCed ca!se.• Be belie"e, howe"er, that the r!lin# in Serrano did not consider the

$!ll meanin# o$ (rticle 27D o$ the 'abor -ode Sec!rity o$ en!re. G /n

cases o$ re#!lar employment, the employer shall not terminate the

ser"ices o$ an employee eAcept $or a +!st ca!se or when a!thoriCed

by this itle. (n employee who is !n+!stly dismissed $rom wor shall

be entitled to reinstatement witho!t loss o$ seniority ri#hts and other

pri"ile#es and to his $!ll bacwa#es, incl!si"e o$ allowances, and to

his other benets or their monetary e!i"alent comp!ted $rom the

time his compensation was withheld $rom him !p to the time o$ his

act!al reinstatement. his means that the termination is ille#al only

i$ it is not $or any o$ the +!stied or a!thoriCed ca!ses pro"ided by

law. Pay%ent o /ac1<ages an ot8er /enets+ incluing

reinstate%ent+ is =ustie only i t8e e%'loyee <as un=ustly

is%isse. ($ter care$!lly analyCin# the conse!ences o$ the

di"er#ent doctrines in the law on employment termination, we

belie"e that in cases in"ol"in# dismissals $or ca!se b!t witho!t

obser"ance o$ the twin re!irements o$ notice and hearin#, the

better r!le is to abandon the Serrano doctrine and to $ollow Benphil

case by holdin# that the dismissal was $or +!st ca!se b!t imposin#

sanctions on the employer. S!ch sanctions, howe"er, m!st be stier

than that imposed in Benphil to disco!ra#e the abhorrent practice o$

dismiss now, pay later, which we so!#ht to deter. he sanction

sho!ld be in the nat!re o$ indemnication or penalty and sho!ld

depend on the $acts o$ each case, tain# into special consideration

the #ra"ity o$ the d!e process "iolation o$ the employer. <y doin# so,

this -o!rt wo!ld be able to achie"e a $air res!lt by dispensin# +!stice

not +!st to employees, b!t to employers as well.• )!e process !nder the 'abor -ode, lie -onstit!tional d!e process,

has two aspectsF s!bstanti"e, i.e., the "alid and a!thoriCed ca!ses o$

employment termination !nder the 'abor -ode% and proced!ral, i.e.,

the manner o$ dismissal. Proceural ue 'rocess reAuire%ents

or is%issal are oun in t8e F%'le%enting Rules o P.7.

$+ as a%ene+ ot8er<ise 1no<n as t8e La/or Coe o t8e

P8ili''ines in 0oo1 DF+ Rule F+ 9ec. $+ as a%ene /y

7e'art%ent rer Nos. # an 23. 0reac8es o t8ese ue'rocess reAuire%ents violate t8e La/or Coe. Therefore

statutory due process should be dierentiated from failure

to comply with constitutional due process. Constitutional



due process protects the individual from the government

and assures him of his rights in criminal, civil or

administrative proceedings ; while statutory due process

found in the Labor Code and Implementing Rules protects

employees from being unustly terminated without ust

cause after notice and hearing.

• >nder the -i"il -ode, no%inal a%ages is ad+!dicated in order that

a ri#ht o$ the plainti&, which has been "iolated or in"aded by the

de$endant, may be "indicated or reco#niCed, and not $or the p!rpose

o$ indemni$yin# the plainti& $or any loss s!&ered by him. he

"iolation o$ the petitioners5 ri#ht to stat!tory d!e process by the

pri"ate respondent warrants the payment o$ indemnity in the $orm o$

nominal dama#es. he amo!nt o$ s!ch dama#es is addressed to the

so!nd discretion o$ the co!rt, tain# into acco!nt the rele"ant

circ!mstances. (t the "ery least, it pro"ides a "indication or

reco#nition o$ this $!ndamental ri#ht #ranted to the latter !nder the

'abor -ode and its /mplementin# R!les.• TFNG+ ,.+ se'arate o'inion- / conc!r in the res!lt, the nal

disposition o$ the petition bein# correct. he -o!rt emphatically

rea*rms the r!le that dismissals $or +!st ca!se are not in"alidated

d!e to the $ail!re o$ the employer to obser"e the proper notice and

hearin# re!irements !nder the 'abor -ode. (t the same time, t8e

7ecision li1e<ise esta/lis8es t8at t8e Civil Coe 'rovisions

on a%ages serve as t8e 'ro'er ra%e<or1 or t8e

a''ro'riate relie to t8e e%'loyee is%isse or =ust cause i

t8e noticeI8earing reAuire%ent is not %et. Serrano ". 'R-,

inso$ar as it is controllin# in dismissals $or !na!thoriCed ca!ses, is no

lon#er the controllin# precedent. (ny and all pre"io!s r!lin#s and

statements o$ the -o!rt inconsistent with these determinations are

now deemed inoperati"e. • i"en the lon# contro"ersy that has do##ed this present iss!e

re#ardin# dismissals $or +!st ca!se, it is wise to lay down standards

that wo!ld #!ide the proper award o$ dama#es !nder the -i"il -ode

in cases wherein the employer $ailed to comply with stat!tory d!e

process in dismissals $or +!st ca!se. / belie"e that it can be

maintained as a #eneral r!le, that $ail!re to comply with the

stat!tory re!irement o$ notice a!tomatically #i"es rise to nominal

dama#es, at the "ery least, e"en i$ the dismissal was s!stained $or +!st ca!se. ominal dama#es are ad+!dicated in order that a ri#ht o$

a plainti& which has been "iolated or in"aded by another may be

"indicated or reco#niCed witho!t ha"in# to indemni$y the plainti& $or



any loss s!&ered by him. ominal dama#es may liewise be

awarded in e"ery obli#ation arisin# $rom law, contracts, !asi:

contracts, acts or omissions p!nished by law, and !asi:delicts, or

where any property ri#ht has been in"aded.• /t has also been held that one5s employment, pro$ession, trade, or

callin# is a property ri#ht and the wron#$!l inter$erence therewith

#i"es rise to an actionable wron#.• -onsiderin# that the a&ected ri#ht is a property ri#ht, there is

+!stication in basin# the amo!nt o$ nominal dama#es on the

partic!lar characteristics attachin# to the claimant5s employment. (t

the same time, it sho!ld be reco#niCed that no%inal a%ages are

not %eant to /e co%'ensatory.• ctual or co%'ensatory a%ages are not availa/le as a

%atter o rig8t to an e%'loyee is%isse or =ust cause /ut

enie statutory ue 'rocess. (n award o$ bacwa#es dis#!ised

as act!al dama#es wo!ld almost ne"er be +!stied i$ the employee

was dismissed $or +!st ca!se.• emperate or nominal dama#es may yet pro"e to be a pla!sible

remedy, especially when common sense dictates that pec!niary loss

was s!&ered, b!t incapable o$ precise denition.



,a1a *oos (P) v. Pacot et al.+ (R) | GR No. 2"24! | Ter%ination

ga/on 7octrine | Garcia+ , '-

• Rs were hired by P, was later terminated, as alle#ed by P, were in a

H)ire nancial straitsI, !ncontested is the $act that P did not ser"e

notices atleast 1 month be$ore termination.

• '( $a"o!red Rs, orderin# reinstatement and@or payment bacwa#esand separation i$ reinstatement is no lon#er possible. 'R-

!ltimately modied by remo"in# the award $or bacwa#es. -(

re"ersed applyin# Serrano doctrine. =ence this.• ranted. Rs are dismissed b!t #ranted with nominal dama#es ;93

$or "iolation o$ the d!e process.• ( dismissal $or +!st ca!se !nder (rticle 282 o$ the 'abor -ode

implies that the employee concerned has committed, or is #!ilty o$,

some "iolation a#ainst the employer, i.e. the employee hascommitted some serio!s miscond!ct, is #!ilty o$ some $ra!d a#ainst

the employer, or, as in (#abon, has ne#lected his d!ties. h!s, it can

be said that the employee himsel$ initiated the dismissal process. On

another breath, a dismissal $or an a!thoriCed ca!se !nder (rticle

28 o$ the same -ode does not necessarily imply delin!ency or

c!lpability on the part o$ the employee. /nstead, the dismissal

process is initiated by the employer5s eAercise o$ his mana#ement

prero#ati"e, i.e. when the employer opts to install labor sa"in#de"ices, when he decides to cease b!siness operations or when, as

in this case, he !ndertaes to implement a retrenchment pro#ram.

he clear:c!t distinction between a dismissal $or +!st ca!se !nder

(rticle 282 and a dismissal $or a!thoriCed ca!se !nder (rticle 28 is

$!rther rein$orced by the $act that in the rst instance, payment o$

separation pay, as a r!le, is not re!ired, while in the second, the

law re!ires payment o$ separation pay. or these reasons, there

o!#ht to be a di&erence in treatment when the #ro!nd $or dismissalis one o$ the +!st ca!ses !nder (rticle 282, and when based on one

o$ the a!thoriCed ca!ses !nder (rticle 28. (ccordin#ly, it is wise to

hold thatF 13 i$ the dismissal is based on a +!st ca!se !nder (rticle

282 b!t the employer $ailed to comply with the notice re!irement,

the sanction to be imposed !pon him sho!ld be tempered, the

dismissal process bein# in e&ect, initiated by an act imp!table to the

employee% and 23 i$ the dismissal is based on an a!thoriCed ca!se

!nder (rticle 28 b!t the employer $ailed to comply with the noticere!irement, the sanction sho!ld be sti&er beca!se the dismissal



process was initiated by the employer5s eAercise o$ his mana#ement

prero#ati"e.• he records be$ore !s re"eal that E(( was indeed s!&erin# $rom

serio!s b!siness losses at the time it terminated respondents5

employment. h!s, there was #ro!nd $or respondents5 dismissal, i.e.,

retrenchment, which is one o$ the a!thoriCed ca!ses en!merated

!nder (rticle 28 o$ the 'abor -ode. 'iewise, it is established that

E(( $ailed to comply with the notice re!irement !nder the same

(rticle. -onsiderin# the $act!al circ!mstances in the instant case,

we, there$ore, deem it proper to A the indemnity at P;9,999.99.• Be liewise nd the -o!rt o$ (ppeals to ha"e been in error when it

ordered E(( to pay respondents separation pay e!i"alent to one

13 month salary $or e"ery year o$ ser"ice. his is beca!se in Reahs

-orporation "s. 'R-, we made the $ollowin# declarationF he r!le,

there$ore, is that in all cases o$ b!siness clos!re or cessation o$

operation or !ndertain# o$ the employer, the a&ected employee is

entitled to separation pay. his is consistent with the state policy o$

treatin# labor as a primary social economic $orce, a&ordin# $!ll

protection to its ri#hts as well as its wel$are. he exce'tion is when

the clos!re o$ b!siness or cessation o$ operations is due to serious

business losses or !nancial reverses; duly proved , in which

case, the ri#ht o$ a&ected employees to separation pay is lost $or

ob"io!s reasons. . . .



Eastern ssurance & 9urety (P) v. 9ec. o La/or+ etc. (R) | GR No.

#45I"3 | 2.2.#3 | Migrant or1ers Generally I Recruit%ent &

Place%ent I | Narvasa+ , '-

• E?< Manpower applied $or a license to en#a#e in the b!siness o$

recr!itment% P #a"e its bond. >nable to deli"er on their promise to

persons $or deployment, said persons s!ed $or "iolations o$ (rts.2 and 4 o$ '-. E?<3 $ailed to answer nor appear in the hearin#s

cond!cted.• P disclaimed liability, holdin# that s!ch liability was not eApressly

co"ered by the bond% PO0( has no +!risdiction $or$eit!re o$ the bond

1;93.• PO0( r!led in $a"o!r o$ complainants mostly3% P were held +ointly

liable% later modied by the secretary, holdin# +ointly liable to 1D

only. =ence this, 0(S-O contends that the PO0( had noad+!dicatory +!risdiction o"er the monetary claims in !estion

beca!se the same did not arise $rom employer:employee relations.• )ismissed. Secretary o$ 'abor has the power !nder Section ; o$ the

law to apply these sanctions, as well as the a!thority, con$erred by

Section 6, not only to restrict and re#!late the recr!itment and

placement acti"ities o$ all a#encies, b!t also to prom!l#ate r!les

and re#!lations to carry o!t the ob+ecti"es and implement the

pro"isions #o"ernin# said acti"ities. P!rs!ant to this r!le:main#power th!s #ranted, the Secretary o$ 'abor #a"e the PO0(, on its

own initiati"e or !pon lin# o$ a complaint or report or !pon re!est

$or in"esti#ation by any a##rie"ed person, . . . a!thority to3 cond!ct

the necessary proceedin#s $or the s!spension or cancellation o$ the

license or a!thority o$ any a#ency or entity $or certain en!merated

o&enses incl!din# G 13 the imposition or acceptance, directly or

indirectly, o$ any amo!nt o$ money, #oods or ser"ices, or any $ee or

bond in eAcess o$ what is prescribed by the (dministration, and 23any other "iolation o$ pertinent pro"isions o$ the 'abor -ode and

other rele"ant laws, r!les and re#!lations.• /mplicit in these powers is the award o$ appropriate relie$ to the

"ictims o$ the o&enses committed by the respondent a#ency or

contractor, specially the re$!nd or reimb!rsement o$ s!ch $ees as

may ha"e been $ra!d!lently or otherwise ille#ally collected, or s!ch

money, #oods or ser"ices imposed and accepted in eAcess o$ what is

licitly prescribed. /t wo!ld be illo#ical and abs!rd to limit thesanction on an o&endin# recr!itment a#ency or contractor to

s!spension or cancellation o$ its license, witho!t the concomitant



obli#ation to repair the in+!ry ca!sed to its "ictims. /t wo!ld res!lt

either in rewardin# !nlaw$!l acts, as it wo!ld lea"e the "ictims

witho!t reco!rse, or in compellin# the latter to liti#ate in another

$or!m, #i"in# rise to that m!ltiplicity o$ actions or proceedin#s which

the law abhors.

Ca'ricorn Fnternational Travel & Tours (P) v. C & 9a%eer

verseas Place%ent gency (R) GR No. #23#5 | .4.#3 | Migrant

or1ers Recruit%ent & Place%ent I Generally | Cortes+ , '-

• /s the cash bond posted by a recr!itment a#ency in the Philippine

O"erseas 0mployment (dministration PO0(3 may be #arnished by a

+!d#ment creditor o$ the a#ency.• /n a ci"il case between P-o and R-o, R- manila held $or P-o and $or

the latter to be indemnied D1.23 by R-o. PO0( e"ent!ally

complied w@ the R-s order. he -( re"ersed, pre"entin# P-o $rom

attachin#, le"yin# and #arnishin# R-oUs cash bond, and to ret!rn the

same to the PO0(. =ence this.• )enied $or 'ac o$ Merit. Pri"ate respondent5s liability to petitioner

relates to a p!rely contract!al obli#ation arisin# $rom the p!rchase

and sale o$ airline ticets. Bhile the liability may ha"e been inc!rred

in connection with the b!siness o$ recr!itin# or placin# o"erseasworers, it is denitely not one arisin# $rom "iolations o$ the

conditions $or the #rant and !se o$ the license or a!thority and

contracts o$ employment. or is it one arisin# $rom the "iolation o$

labor laws.• 0Aplicit $rom the pro"isions o$ the 'abor -ode and Philippines

O"erseas 0mployment (dministration R!les and Re#!lationF a3 that

the cash bond is a re!isite $or the iss!ance and renewal o$ a license

or a!thority to en#a#e in the b!siness o$ recr!itment and o"erseasplacement% b3 that the cash bond is to answer $or the liabilities o$

the a#ency arisin# $rom "iolations o$ the conditions $or the #rant or

!se o$ the license or a!thority or the contracts o$ employment, the

'abor -ode, the PO0( r!les and 'abor )epartment iss!ances and all

liabilities that the PO0( may impose% c3 that the amo!nt o$ the cash

bond m!st be maintained d!rin# the li$etime o$ the license or

a!thority% and d3 that the amo!nt o$ the cash bond shall be

ret!rned to the a#ency only when it s!rrenders its license ora!thority, and only !pon postin# o$ a s!rety bond o$ the same

amo!nt "alid $or three 3 years.



• On a broader scale, the !ndertain# to ass!me +oint and solidary

liability and to #!arantee compliance with labor laws, and the

conse!ent postin# o$ cash and s!rety bonds, may be traced all the

way bac to the constit!tional mandate $or the State to a&ord $!ll

protection to labor, local and o"erseas J(rt. Q///, sec. K.• he pec!liar nat!re o$ o"erseas employment maes it "ery di*c!lt

$or the ilipino o"erseas worer to e&ecti"ely #o a$ter his $orei#n

employer $or employment:related claims and, hence, p!blic policy

dictates that, to a&ord o"erseas worers protection $rom

!nscr!p!lo!s employers, the recr!itment or placement a#ency in

the Philippines be made to share in the employer5s responsibility.• -onsiderin# the rationale $or re!irin# the postin# o$ a cash bond

and its nat!re, it cannot there$ore be ar#!ed that the cash bond is

not eAempt $rom eAec!tion by a +!d#ment creditor simply beca!se it

is not one o$ those en!merated in R!le D, sec. 12 o$ the R!les o$

-o!rt. o accede to s!ch an ar#!ment wo!ld be tantamo!nt to

t!rnin# a blind eye to the clear intent o$ the law to reser"e the cash

bond $or the employment:related claims o$ o"erseas worers and $or

"iolations o$ labor laws.



9trong8ol Fnsurance v. C | GR No. !!3"3 | 2.43.#$ | Migrant

or1ers Generally : Recruit%ent & Place%ent I | Cru6+ , '-

• he petitioner in"oes d!e process to escape liability on a s!rety

bond eAec!ted $or the protection o$ a ilipino seaman.• (ctin# in behal$ o$ itUs $orei#n principal Vatar ational ishin#, Pan

(sian 'o#istics and radin# Jrecr!itment ? placement a#encyK. =ired(driano >rtes!ela as a captain ;9 bond by P3. months in the +ob,

>rtes!elaUs ser"ices was terminated, therea$ter s!ed the (#ency $or

breach o$ contract and dama#es.• PO0( r!led $or >rtes!ela, later s!ed in the /ns!rance -ommission P

beca!se the a#ency ceased operation. (sin# $or re"ersal at the

claimin# "iolation o$ d!e process as it was not specically directed to

pay. -( dismissed. =ence this.

• )enied. (*rmed. /n the s!rety bond, the petitioner !ne!i"ocallybo!nd itsel$F o answer $or all liabilities which the Philippine

O"erseas 0mployment (dministration may ad+!d#e@impose a#ainst

the Principal in connection with the recr!itment o$ ilipino seamen.

Strictly interpreted, this wo!ld mean that the petitioner a#reed to

answer $or whate"er decision mi#ht be rendered a#ainst the

principal, whether or not the s!rety was impleaded in the complaint

and had the opport!nity to de$end itsel$. here is nothin# in the

stip!lation callin# $or a direct +!d#ment a#ainst the s!rety as a co:de$endant in an action a#ainst the principal. On the contrary, the

petitioner a#reed to answer $or all liabilities that mi#ht be

ad+!d#ed or imposed by the PO0( a#ainst the Principal. <!t e"en i$

this interpretation were re+ected, considerin# the well:nown maAim

that the s!rety is a $a"orite o$ the law, the petitioner wo!ld still

ha"e to eAplain its other a#reement that notice to the Principal is

notice to the s!rety. his was in $act another special stip!lation

typewritten on the printed $orm o$ the s!rety bond prepared by thepetitioner. >nder this commitment, the petitioner is deemed, by the

implied notice, to ha"e been #i"en an opport!nity to participate in

the liti#ation and to present its side, i$ it so chose, to a"oid liability. /$

it did not decide to inter"ene as a co:de$endant and perhaps also as

cross:claimant a#ainst Pan (sian3, it cannot be heard now to

complain that it was denied d!e process.• he petitioner contends, howe"er, that the said stip!lation is

!nconstit!tional and contrary to p!blic policy, beca!se it is a "irt!alwai"er. he -o!rt cannot a#ree. he ar#!ment ass!mes that the

ri#ht to a hearin# is absol!te and may not be wai"ed in any case



!nder the d!e process cla!se. his is not correct. (s a matter o$ $act,

the ri#ht to be heard is as o$ten wai"ed as it is in"oed, and "alidly

as lon# as the party is #i"en an opport!nity to be heard on his

behal$. he circ!mstance that the chance to be heard is not a"ailed

o$ does not dispara#e that opport!nity and depri"e the person o$ the

ri#ht to d!e process.• /n the proceedin#s be$ore the -ommission, the petitioner was #i"en

$!ll opport!nity which it too3 to present its side, in its answer with

co!nterclaim to the complaint, in its testimony at the hearin#s, in its

motion to dismiss the complaint, and in its 19:pa#e memorand!m.

here is absol!tely no !estion that in that proceedin#, the

petitioner was act!ally and e"en eAtensi"ely heard.



P8il E%'loy (gency) (P) v. Para%io et al.+ (R) | GR No. 2!5 |

.2".3 | Migrant or1ers Recruit%ent & Place%ent I Generally

| Calle=o+ 9r.+ , '-

• Respondents herein were repatriated $rom their employment in

aiwan on di&erent dates, $or di&erent ca!ses, b!t all prior to the

eApiration o$ their respecti"e contracts.• hey led separate complaints a#ainst their recr!iter petitioner

herein3 be$ore the 'R- $or ille#al dismissal, non:payment o$

benets and eApenses. '( $o!nd $or Rs. 'R- re"ersed the decision

o$ the labor arbiter and $o!nd the respondents were le#ally

dismissed. -( reinstated '(Us decision with modication as to

dama#es. =ence this.• )enied. Preliminarily, it bears stressin# that the respondents who

led complaints $or ille#al dismissal a#ainst the petitioner wereo"erseas ilipino worers whose employment contracts were

appro"ed by the Philippine O"erseas 0mployment (dministration

PO0(3 and were entered into and per$ected here in the Philippines.

(s s!ch, the r!le leA loci contract!s the law o$ the place where the

contract is made3 #o"erns. here$ore, the 'abor -ode, its

implementin# r!les and re#!lations, and other laws a&ectin# labor,

apply in this case.

• (pplyin# the law and the r!le, the employer is b!rdened to pro"ethat the employee was s!&erin# $rom a disease which pre"ented his

contin!ed employment, or that the employee5s wo!nd pre"ented his

contin!ed employment. Section 8, R!le 1, <oo / o$ the Omnib!s

R!les /mplementin# the 'abor -ode re!ires a certication $rom

competent p!blic a!thority that the employee was hea"ily wo!nded

and had lost the ability to wor.• /n Sippers Pacic, /nc. ". Mira, we r!led that an o"erseas ilipino

worer who is ille#ally terminated shall be entitled to his salarye!i"alent to the !neApired portion o$ his employment contract i$

s!ch contract is less than one year. =owe"er, i$ his contract is $or a

period o$ at least one year, he is entitled to recei"e his salaries

e!i"alent to the !neApired portion o$ his contract, or three months5

salary $or e"ery year o$ the !neApired term, whiche"er is lower.• (ccordin# to Section 19, para#raph 2 o$ Rep. (ct o. 8942, the

a#ency which deployed the employees whose employment contract

were ad+!d#ed ille#ally terminated, shall be +ointly and solidarilyliable with the principal $or the money claims awarded to the

a$oresaid employees. >nder Section 1; o$ the same (ct, the



repatriation o$ the worer and the transport o$ his personal

belon#in#s shall be the primary responsibility o$ the a#ency which

recr!ited or deployed the o"erseas contract worer. (ll the costs

attendant thereto shall be borne by the a#ency concerned and@or its

principal.



Peo'le v. ,uge Panis | GR No. LI"!5I | .22.!5 | Migrant

or1ers Fllegal Recruet%ent | Cru6 ,+ '-

• he basic iss!e in this case is the correct interpretation o$ (rticle

1b3 o$ P. ). 442, otherwise nown as the 'abor -ode, HRecr!itment

and PlacementI.

• ( certain (b!# was ori#inally s!ed $or Hoperatin# w@o a license $romMO'0 in the en#a#ement o$ Recr!itment and Placement L char#in#

theretoI and promisin# employment in Sa!di% in "iolation o$ (rt. 16

in relation to (rt. D o$ the '-.• (b!# motioned to !ash w@c was e"ent!ally #ranted L holdin# that

the in$ormation did not char#e an o&ense beca!se he was acc!se o$

/lle#al Recr!itment, citin# (rt. 1b3, that there is /R i$, whene"er

two or more persons are in any manner promised or o&ered any

employment $or a $ee. he motion to !ash was e"ent!ally #ranted,hence this.

• /ORM(/OS R0/S(0). he pro"iso was intended neither to

impose a condition on the basic r!le nor to pro"ide an eAception

thereto b!t merely to create a pres!mption. he pres!mption is that

the indi"id!al or entity is en#a#ed in recr!itment and placement

whene"er he or it is dealin# with two or more persons to whom, in

consideration o$ a $ee, an o&er or promise o$ employment is made in

the co!rse o$ the can"assin#, enlistin#, contractin#, transportin#,!tiliCin#, hirin# or proc!rin# o$3 worers.

• he n!mber o$ persons dealt with is not an essential in#redient o$

the act o$ recr!itment and placement o$ worers. (ny o$ the acts

mentioned in the basic r!le in (rticle 1b3 will constit!te

recr!itment and placement e"en i$ only one prospecti"e worer is

in"ol"ed. he pro"iso merely lays down a r!le o$ e"idence that

where a $ee is collected in consideration o$ a promise or o&er o$

employment to two or more prospecti"e worers, the indi"id!al orentity dealin# with them shall be deemed to be en#a#ed in the act

o$ recr!itment and placement. he words shall be deemed create

that pres!mption be #i"en the $orce o$ a disp!table pres!mption or

o$ prima $acie e"idence o$ en#a#in# in recr!itment and placement.

lepp ". Odin p., Mc=enry -o!nty 49 ) .B. 1, 14.3• (t any rate, the interpretation here adopted sho!ld #i"e more $orce

to the campai#n a#ainst ille#al recr!itment and placement, which

has "ictimiCed many ilipino worers seein# a better li$e in a $orei#nland, and in"estin# hard:earned sa"in#s or e"en borrowed $!nds in



p!rs!it o$ their dream, only to be awaened to the reality o$ a

cynical deception at the hands o$ their own co!ntrymen.



Auino (P) v. C & Peo'le (R) | GR No. #2!#5 | 22.$2.#2 | Migrant

or1ers Fllegal Recruet%ent | Guttierre6+ , '-

• P was s!ed $or "iolation o$ (rt. 2; o$ the '-% a$ter operatin# to recr!it

worers $or employment abroad w@o license $rom MO'0. 4 "ictims,

all in"ol"ed #i"in# cash3 to P.

• 'ower -o!rt $o!nd P #!ilty beyond reasonable do!bt. -( a*rmed,hence this.

• Re"ersed. (c!itted. )oes the receipt o$ payments, a$ter the

eApiration o$ the license, $or ser"ices rendered be$ore said eApiration

constit!te ille#al recr!itment Be belie"e that it does not, at least

not $or p!rposes o$ criminal prosec!tions. Recr!itment re$ers to the

orderin# o$ ind!cements to !alied personnel to enter a partic!lar

+ob or employment. he ad"ertisin#, the promise o$ $!t!re

employment and other come:ons too place while Ms. (!ino wasstill licensed.

• r!e, the payments $or ser"ices rendered are necessary

conse!ences o$ the applications $or o"erseas employment.

=owe"er, it is asin# too m!ch to eApect a licensed a#ency to

absol!tely at the stroe o$ midni#ht stop all transactions on the day

its license eApires and re$!se to accept carry:o"er payments a$ter

the a#ency is closed. /n any b!siness, there has to be a windin#:!p

a$ter it ceases operations. he collection o$ !npaid acco!nts sho!ldnot be the basis o$ a criminal prosec!tion. he o"ernment did not

!estion the le#ality o$ the payments as s!ch. he prosec!tion is

based on the date o$ the prohibited acti"ity, not on the payments

bein# ille#al eAactions e"er i$ e&ected d!rin# the correct period. he

payments are necessary in order to de$ray the eApenses entailed in

any o"erseas contract o$ employment. hey are intended $or

administrati"e and $or b!siness o$ eApenses and $or the tra"ellin#

eApenses o$ the applicants once cleared $or o"erseas tra"el.• /t has been the consistent r!lin# o$ this -o!rt that the iss!ance o$ a

chec is not payment !ntil the chec has been encashed. (ltho!#h a

chec, as a ne#otiable instr!ment, is re#arded as a s!bstit!te $or

money, it is not money. =ence, its mere deli"ery does not, by itsel$,

operate as payment. P(' ". -o!rt o$ (ppeals, 181 S-R( ;;7

J1DD9K3.



Peo'le (P) v. Ca/acang () | GR No. 224#2 | .2.#" | Migrant

or1ers Fllegal Recruet%ent | Puno+ , '-

• (( is char#ed $or ille#al recr!itment% a$ter cond!ctin# recr!itment

and promisin# a +ob to 4 people all related3. 0"idence shows that ((

is not licensed, instr!cted the "ictims to pay processin# $ees.

• -/ $o!nd her #!ilty sentencin# to li$e imprisonment. =ence this.• (*rmed w@ Modications more se"ere3. /t is incorrect to maintain

that to be liable $or ille#al recr!itment, one m!st represent

himsel$@hersel$ to the "ictims as a d!ly:licensed recr!iter.. /lle#al

recr!itment is dened in (rticle 8 a3 o$ the 'abor -ode, as

amended, as a3ny recr!itment acti"ities, incl!din# the prohibited

practices en!merated !nder (rticle 4 o$ this -ode, to be

!ndertaen by non:licenses or non:holders o$ a!thority. (rticle 1

b3 o$ the same -ode denes recr!itment and placement asre$errin# toF (3ny act o$ can"assin#, enlistin#, contractin#,

transportin#, !tiliCin#, hirin# or proc!rin# worers, and incl!des

re$errals, contract ser"ices, promisin# or ad"ertisin# $or

employment, locally or abroad, whether $or prot or notF Pro"ided,

hat any person or entity which in any manner, o&ers or promises

$or a $ee employment to two or more persons shall be deemed

en#a#ed in recr!itment and placement. -learly, to pro"e ille#al

recr!itment, only two elements need to be shown, "iCF 13 the personchar#ed with the crime m!st ha"e !ndertaen recr!itment acti"ities

or any o$ the acti"ities en!merated in (rticle 4 o$ the 'abor -ode,

as amended3% and 23 said person does not ha"e a license or

a!thority to do so. Ft is not reAuire t8at it /e s8o<n t8at suc8

'erson <rongully re'resente 8i%sel as a license

recruiter.• he only time they taled to the mana#er o$ the 'aas (#ency was

a$ter their aborted Wi#ht to (b! )habi, when they were tryin# tolocate the whereabo!ts o$ appellant. -learly, it was appellant who

directly recr!ited pri"ate complainants within the meanin# o$ (rticle

8 a3 and b3 the 'abor -ode. Since it is !ndisp!ted that appellant is

not a holder o$ a license or a!thority to recr!it $rom the )epartment

o$ 'abor, thro!#h the PO0(, her acts constit!te ille#al recr!itment.• (ppellant cannot s!ccess$!lly contend she merely per$ormed her

d!ties as an employee o$ a licensed recr!itment a#ency. (part $rom

her !ncorroborated testimony on the matter, she $ailed to presentcredible e"idence.



DirI,en 98i''ing (P) v. NLRC+ et al. (R) | GR Nos. LI"!322I2$ |

22.2!.!4 | Migrant or1ers Recruit%ent & Place%ent

Contractual 9ti'ulations | Guttierre6+ ,r.+ , '-

• ( complainant here, the captain <is!la3 recei"ed a cable on 1.19.7D

$rom the -ompany in$ormin# them that they may be directed to call

at /:-ontrolled Ports /:Militant 'abor Or#, capable o$ holdin#ships3% therea$ter was ad"ised o$ the proced!re to be $ollowed in

comp!tin# $or special or additional compensation o$ crew members

while in said ports.• On .24.7D <is!la sent a cable to the company ad"isin# them that a

consens!s was achie"ed by the crew% that they are not contented w@

their present salaries% based on their ro!tes, haCardo!s car#o% that

they wanted to be paid w@ / rate ;9X increase3% both sides

e"ent!ally a#reed to accept a 2;X increase s!b+ect to conditions%w@c was e&ected.

• S!bse!ently the -ompany so!#ht to cancel their contracts, citin#

act!ations o$ the seamen% S< ranted% therea$ter the -ompany

cabled the seamen in$ormin# that their contracts are terminated and

they are to be repatriated immediately.• S!in# $or ille#al dismissal and non:payment o$ earned wa#es at the

S<% -o!nterin# P s!ed $or breach o$ contract. S< r!led $or P. 'R-

re"ersed, to pay $or the !neApired contract term. =ence this Petitionand Reconsideration3

• Reconsideration ranted@Petition )ismissed.

• /$ any minor ad"anta#es #i"en to ilipino seamen may somehow c!t

into the prots o$ local mannin# a#encies and $orei#n shipowners,

that is not s!*cient reason why the S< or the 'R- sho!ld not

stand by the $ormer instead o$ listenin# to !ns!bstantiated $ears that

they wo!ld be illin# the hen which lays the #olden e##s.

Prescindin# $rom the abo"e, the -o!rt now holds that neither theational Seamen <oard nor the ational 'abor Relations

-ommissions sho!ld, as a matter o$ o*cial policy, le#itimiCe and

en$orce d!bio!s arran#ements where shipowners and seamen enter

into ctitio!s contracts similar to the addend!m a#reements or side

contracts in this case whose p!rpose is to decei"e.• he $orm contracts appro"ed by the ational Seamen <oard are

desi#ned to protect ilipino seamen not $orei#n shipowners who can

tae care o$ themsel"es. he standard $orms embody the basicminim!ms which m!st be incorporated as parts o$ the employment



contract. Section 1;, R!le , R!les and Re#!lations /mplementin#

the 'abor -ode.3• hey are not collecti"e bar#ainin# a#reements or imm!table

contracts which the parties cannot impro"e !pon or modi$y in the

co!rse o$ the a#reed period o$ time. o state, there$ore, that the

a&ected seamen cannot petition their employer $or hi#her salaries

d!rin# the 12 months d!ration o$ the contract r!ns co!nter to

established principles o$ labor le#islation. he ational 'abor

Relations -ommission, as the appellate trib!nal $rom decisions o$ the

ational Seamen <oard, correctly r!led that the seamen did not

"iolate their contracts to warrant their dismissal.• he -o!rt a#rees with the mo"ants that there is no showin# o$ any

ca!se, which !nder the 'abor -ode or any c!rrent applicable law,

wo!ld warrant the termination o$ the respondentsY ser"ices be$ore

the eApiration o$ their contracts. he -onstit!tion #!arantees State

ass!rance o$ the ri#hts o$ worers to sec!rity o$ ten!re. Sec. D,

(rticle //, -onstit!tion3 Pres!mptions and pro"isions o$ law, the

e"idence on record, and $!ndamental State policy all dictate that the

motions $or reconsideration sho!ld be #ranted.• Petitioner claims that the dismissal o$ pri"ate respondents was

+!stied beca!se the latter threatened the ship a!thorities in

accedin# to their demands, and this constit!tes serio!s miscond!ct

as contemplated by the 'abor -ode. his contention is not well:

taen. <!t e"en i$ there had been s!ch a threat, respondents5

beha"ior sho!ld not be cens!red beca!se it is b!t nat!ral $or them

to employ some means o$ pressin# their demands on petitioner, who

re$!sed to abide with the terms o$ the Special (#reement, to honor

and respect the same. hey were only actin# in the eAercise o$ their

ri#hts, and to depri"e them o$ their $reedom o$ eApression is

contrary to law and p!blic policy.



0 <(-

J.R. os. ;7DDD, ;814:;. (!#!st 1;, 1D8D.K

R0S>RR0--/O S>Z(R(, -0S(R )/M(()(', (0'/O M0)OZ(,

(O/O (0)O (MORSO'O -(<R0R(, )OM/()OR S(OS , /S/)RO

<R(-/(, R(MO )0 <0'0, 0R0SO S(<()O, M(R/ M('(<((,

ROM0O =>0RO and /('/(O P(>0, petitioners, "s. =0 =O. E>)0

('R0)O '. <0/P(NO and M(S(NS(N '/0S, /-., respondents.

J.R. os. 64781:8D. (!#!st 1;, 1D8D.K

R0S>RR0--/O S>Z(R(, -0S(R )/M(()(', (0'/O M0)OZ(,

(O/O (0)O, R(NM>)O P0R0Z, (MORSO'O -(<R0R(,

)OM/()OR S(OS, /S/)RO <R(-/(, -(('/O -(S/-(, /('/(O

P(>0, R(MO )0 <0'0, 0)>(R)O P(('>(, (O/O M/R()(,R(MO >/((, 0R0SO S(R()O, M(R/ M('(<((, ROM0O

=>0RO and B/'R0)O -R/SO<(', petitioners, "s. =0 =OOR(<'0

(/O(' '(<OR R0'(/OS -OMM/SS/O, =0 (/O(' S0(M0

<O(R) now the Philippine O"erseas 0mployment (dministration3, and

M(S(NS(N '/0S, /-., respondents.

V!asha, (sperilla, (ncheta, Pe[a and olasco $or petitioners.

Samson S. (lcantara $or pri"ate respondent.) 0 - / S / O

>/0RR0Z, ER., E pF

hese petitions as $or a re:eAamination o$ this -o!rt5s precedent G

settin# decision in ir:Een Shippin# and Marine Ser"ices /nc. ". ational

'abor Relations -ommission, et al. 12; S-R( ;77 J1D8K3. On

constit!tional, stat!tory, and $act!al #ro!nds, we nd no reason to dist!rb

the doctrine in ir:Een Shippin# and to t!rn bac the cloc o$ pro#ress $or

seabased o"erseas worers. he eAperience #ained in the past $ew years

shows that, $ollowin# said doctrine, we sho!ld neither deny nor diminish

the en+oyment by ilipino seamen o$ the same ri#hts and $reedoms taen

$or #ranted by other worin#men here and abroad.

he cases at bar in"ol"e a #ro!p o$ ilipino seamen who were declared by

the de$!nct ational Seamen <oard S<3 #!ilty o$ breachin# their

employment contracts with the pri"ate respondent beca!se theydemanded, !pon the inter"ention and assistance o$ a third party, the

/nternational ransport Borer5s ederation /3, the payment o$ wa#es



o"er and abo"e their contracted rates witho!t the appro"al o$ the S<.

he petitioners were ordered to reimb!rse the total amo!nt o$

>S\D1,48.44 or its e!i"alent in Philippine -!rrency representin# the

said o"er:payments and to be s!spended $rom the S< re#istry $or a

period o$ three years. he ational 'abor Relations -ommission 'R-3

a*rmed the decision o$ the S<.

/n a corollary de"elopment, the pri"ate respondent, $or $ail!re o$ the

petitioners to ret!rn the o"erpayments made to them !pon demand by

the $ormer, led esta$a char#es a#ainst some o$ the petitioners. he

criminal cases were e"ent!ally consolidated in the sala o$ then

respondent E!d#e (l$redo <enipayo. =ence, these consolidated petitions,

.R. o. 64781:DD and .R. os. ;7DDD and ;814:;, which respecti"ely

pray $or the n!llication o$ the decisions o$ the 'R- and the S<, and

the dismissal o$ the criminal cases a#ainst the petitioners.

he $acts are $o!nd in the !estioned decision o$ the S< in .R. o.

64781:DD.

rom the records o$ this case it appears that the $acts established and@or

admitted by the parties are the $ollowin#% that on di&erent dates in 1D77

and 1D78 respondents entered into separate contracts o$ employment

0Ahs. < to <:17, incl!si"e3 with complainant pri"ate respondent3 to

wor aboard "essels owned@operated@manned by the latter $or a period o$ 12 calendar months and with di&erent ratin# @position, salary, o"ertime

pay and allowance, hereinbelow speciedF . . . % that a$oresaid

employment contracts were "eried and appro"ed by this <oard% that on

di&erent dates in (pril 1D78 respondents petitioners3 +oined the M@

5R(-0 R/0R5% that on or abo!t October 9, 1D78 a$oresaid "essel, with

the respondents on board, arri"ed at the port o$ anco!"er, -anada% that

at this port respondent recei"ed additional wa#es !nder rates prescribed

by the /nternational ransport Borer5s ederation /3 in the totalamo!nt o$ >S\D8,261 .79% that the respondents recei"ed the amo!nts

appearin# opposite their names, to witF . . . % that a$oresaid amo!nts were

o"er and abo"e the rates o$ pay o$ respondents !s appearin# in their

employment contracts appro"ed by this <oard% that on o"ember 19,

1D78, a$oresaid "essel, with respondent on board, le$t anco!"er, -anada

$or Noohama, Eapan% that on )ecember 14, 1D78, while a$oresaid "essel,

was at Nara, Eapan, they were made to disembar. pp. 6466, Rollo3

!rthermore, accordin# to the petitioners, while the "essel was doced at

a#oya, Eapan, a certain (tty. Oscar orres o$ the S< 'e#al )epartment

bo!nded the "essel and called a meetin# o$ the seamen incl!din# the



petitioners, tellin# them that $or their own #ood and sa$ety they sho!ld

si#n an a#reement prepared by him on board the "essel and that i$ they

do, the cases led a#ainst them with S< on o"ember 17, 1D78 wo!ld

be dismissed. h!s, the petitioners si#ned the (#reement dated

)ecember ;, 1D78. (nneA - o$ Petition3 =owe"er, when they were later

nished AeroA copies o$ what they had si#ned, they noticed that the line

which amo!nts3 was@were recei"ed and held by -R0BM0M<0RS in tr!st

$or S=/POB0RS was inserted therein, thereby main# it appear that the

amo!nts #i"en to the petitioners representin# the increase in their wa#es

based on / rates were only recei"ed by them in tr!st $or the pri"ate

respondent.

Bhen the "essel reached Manila, the pri"ate respondent demanded $rom

the petitioners the o"erpayments made to them in -anada. (s the

petitioners re$!sed to #i"e bac the said amo!nts, char#es were leda#ainst some o$ them with the S< and the Pro$essional Re#!lations

-ommission. 0sta$a char#es were also led be$ore di&erent branches o$

the then -o!rt o$ irst /nstance o$ Manila which, as earlier stated, were

s!bse!ently consolidated in the sala o$ the respondent E!d#e (l$redo

<enipayo and which e"ent!ally led to .R. os. ;7DDD and ;814:;.

/n .R. os. 64781:DD, the petitioners claimed be$ore the S< that

contrary to the pri"ate respondent5s alle#ations, they did not commit anyille#al act nor sta#e a strie while they were on board the "essel% that the

Special (#reement entered into in anco!"er to pay their salary

di&erentials is "alid, ha"in# been eAec!ted a$ter peace$!l ne#otiations.

Petitioners $!rther ar#!ed that the amo!nts they recei"ed were in

accordance with the pro"ision o$ law, citin# amon# others, Section 18,

R!le /, <oo / o$ the R!les and Re#!lations /mplementin# the 'abor -ode

which pro"ides that the basic minim!m salary o$ seamen shall not be

less than the pre"ailin# minim!m rates established by the /nternational'abor Or#aniCation /'O3 or those pre"ailin# in the co!ntry whose Wa# the

employin# "essel carries, which e"er in hi#her . . . % and that the

(#reement eAec!ted in a#oya, Eapan had been $orced !pon them and

that intercalation5s were made to mae it appear that they were merely

tr!stees o$ the amo!nts they recei"ed in anco!"er.

On the other hand, the pri"ate respondent alle#ed that the petitioners

breached their employment contracts when they, actin# in concert and

with the acti"e participation5s o$ the / while the "essel was inanco!"er, sta#ed an ille#al strie and by means o$ threats, coercion and

intimidation compelled the owners o$ the "essel to pay to them "ario!s



s!ms totallin# >S\194,244.;% that the respondent entered into the

Special (#reement to pay the petitioners5 wa#e di&erentials beca!se it

was !nder d!ress as the "essel wo!ld not be allowed to lea"e anco!"er

!nless the said a#reement was si#ned, and to pre"ent the shipowner $rom

inc!rrin# $!rther delay in the shipment o$ #oods% and that in "iew o$

petitioners5 breach o$ contract, the latter5s names m!st be remo"ed $rom

the S<5s Re#istry and that they sho!ld be ordered to ret!rn the amo!nts

they recei"ed o"er and abo"e their contracted rates.

he respondent S< r!led that the petitioners were #!ilty o$ breach o$

contract beca!se despite s!bsistin# and "alid S< appro"ed employment

contracts, the petitioners so!#ht the assistance o$ a third party /3 to

demand $rom the pri"ate respondent wa#es in accordance with the /

rates, which rates are o"er and abo"e their rates o$ pay as appearin# in

their S< appro"ed contracts. (s bases $or this concl!sion, the S<statedF

13 he $act that respondents so!#ht the aid o$ a third party /3 and

demanded $or wa#es and o"ertime pay based on / rates is shown in the

entries o$ their respecti"e Pay:O& -learance Slips which were mared as

their 0Ahs. 1 to 18, and we !ote 5)0M()0) / B(0S, O0R/M0,

)/0R0/('S (PR/' O O-O<0R 1D785. Respondent S!Cara admitted

that the entries in his Pay:O& -learance Slip 0Ah. 13 are correct S.,p. 16, )ec. 6, 1D7D3. Moreo"er, it is the policy reiterated "ery o$ten3 by

the / that it does not inter$ere in the a&airs o$ the crewmembers and

masters and@or owners o$ a "essel !nless its assistance is so!#ht by the

crewmembers themsel"es. >nder this prono!nced policy o$ the /, it is

reasonable to ass!me that the representati"es o$ the / in anco!"er,

-anada assisted and inter"ened by reason o$ the assistance so!#ht by

the latter.

23 he $act that the / assisted and inter"ened $or and in behal$ o$ therespondents in the latter5s demand $or hi#her wa#es co!ld be #leaned

$rom the answer o$ the respondents when they admitted that the /

acted in their behal$ in the ne#otiations $or increase o$ wa#es. Moreo"er,

respondent -esar )imaandal admitted that the / di&erential pay was

comp!ted by the / representati"e S, p.7, )ec, 12, 1D7D3

3 he $act that complainant and the owner@operator o$ the "essel were

compelled to si#n the Special (#reement 0Ah. 293 and to pay /di&erentials to respondents in order not to delay the depart!re o$ the

"essel and to pre"ent $!rther losses is shown in the (#reement5 0Aist. R:

213 . . . pp. 6D:79, Rollo3



he S< $!rther saidF

Bhile the <oard reco#niCes the ri#hts o$ the respondents to demand $or

hi#her wa#es, pro"ided the means are peace$!l and le#al, it co!ld not,

howe"er, sanction the same i$ the means employed are "iolent and

ille#al. /n the case at bar, the means employed are "iolent and ille#al $or

in demandin# hi#her wa#es the respondents so!#ht the aid o$ a thirdparty and in t!rn the latter inter"ened in their behal$ and prohibited the

"essel $rom sailin# !nless the owner and@or operator o$ the "essel

acceded to respondents5 demand $or hi#her wa#es. o a"oid s!&erin#

$!rther incalc!lable losses, the owner and@or operator o$ the "essel had

no alternati"e b!t to pay respondents5 wa#es in accordance with the /

scale. he <oard condemns the act o$ a party who enters into a contract

and with the !se o$ $orce@or intimidation ca!ses the other party to modi$y

said contract. /$ the respondents belie"e that they ha"e a a"oid #ro!nd todemand $rom the complainant a re"ision o$ the terms o$ their contracts,

the same sho!ld ha"e been done in accordance with law and not thr!

ille#al means. at p. 72, Rollo3.

(ltho!#h the respondent S< $o!nd that the petitioners were entitled to

the payment o$ earned wa#es and o"ertime pay@allowance $rom

o"ember 1, 1D78 to )ecember 14, 1D78, it ne"ertheless r!led that the

comp!tation sho!ld be based on the rates o$ pay as appearin# in thepetitioners5 S< appro"ed contracts. /t ordered that the amo!nts to which

the petitioners are entitled !nder the said comp!tation sho!ld be

ded!cted $rom the amo!nts that the petitioners m!st ret!rn to the pri"ate

respondent.

On appeal, the 'R- a*rmed the S<5s ndin#s. =ence, the petition in

.R. os. 64781:DD.

Meanwhile, the petitioners in .R. os. ;7DDD and ;814:; mo"ed to!ash the criminal cases o$ esta$a led a#ainst the on the #ro!nd that the

alle#ed crimes were committed, i$ at all, in anco!"er, -anada and,

there$ore, Philippine co!rts ha"e no +!risdiction. he respondent +!d#e

denied the motion. =ence, the second petition.

he principal iss!e in these consolidated petitions is whether or not the

petitioners are entitled to the amo!nts they recei"ed $rom the pri"ate

respondent representin# additional wa#es as determined in the special

a#reement. /$ they are, then the decision o$ the 'R- and S< m!st be

re"ersed. Similarly, the criminal cases o$ esta$a m!st be dismissed



beca!se it $ollows as a conse!ence that the amo!nts recei"ed by the

petitioners belon# to them and not to the pri"ate respondent.

/n arri"in# at the !estioned decision, the S< r!led that the petitioners

are not entitled to the wa#e di&erentials as determined by the /

beca!se the means employed by them in obtainin# the same were "iolent

and ille#al and beca!se in demandin# hi#her wa#es the petitionersso!#ht the aid o$ a third party, which, in t!rn, inter"ened in their behal$

and prohibited the "essel $rom sailin# !nless the owner and@or operator o$

the "essel acceded to respondents5 demand $or hi#her wa#es. (nd as

proo$ o$ this concl!sion, the S< cited the $ollowin#F a3 the entries in the

petitioners Pay:O& clearances lip which contained the phrase

)0M()0) / B(0S. . . .% b3 the alle#ed policy o$ the /5 in not

inter$erin# with crewmembers o$ a "essel !nless its inter"ention is so!#ht

by the crewmembers themsel"es% c3, the petitioners5 admission that /acted in their behal$% and d3 the $act that the pri"ate respondent was

compelled to si#n the special a#reement at anco!"er, -anada.

here is nothin# in the p!blic and pri"ate respondents5 pleadin#s, to

s!pport the alle#ations that the petitioners !sed $orce and "iolence to

sec!re the special a#reement si#ned in anco!"er, <ritish -ol!mbia.

here was no need $or any $orm o$ intimidation comin# $rom the ilipino

seamen beca!se the -anadian <rotherhood o$ Railways and ransportBorers -<R3, a stron# -anadian labor !nion, baced by an

international labor $ederation was act!ally doin# all the inW!encin# not

only on the ship:owners and employers b!t also a#ainst third world

seamen themsel"es who, by recei"in# lower wa#es and cheaper

accommodations, were threatenin# the employment and li"elihood o$

seamen $rom de"eloped nations.

he bases !sed by the respondent S< to s!pport its decision do not

pro"e that the petitioners initiated a conspiracy with the / ordeliberately so!#ht its assistance in order to recei"e hi#her wa#es. hey

only pro"e that when / acted in petitioners5 behal$ $or an increase in

wa#es, the latter mani$ested their s!pport. his wo!ld be a lo#ical and

nat!ral reaction $or any worer in whose benet the / or any other labor

#ro!p had inter"ened. he petitioners admit that while they eApressed

their con$ormity to and their sentiments $or hi#her wa#es by means o$

placards, they, ne"ertheless, contin!ed worin# and #oin# abo!t their

!s!al chores. /n other words, all they did was to eAercise their $reedom o$ speech in a most peace$!l way. he / people, in t!rn, did not employ

any "iolent means to $orce the pri"ate respondent to accede to their



demands. /nstead, they simply applied e&ecti"e press!re when they

intimated the possibility o$ interdiction sho!ld the shipowner $ail to heed

the call $or an !pward ad+!stment o$ the rates o$ the ilipino seamen.

/nterdiction is nothin# more than a re$!sal o$ / members to render

ser"ice $or the ship, s!ch as to load or !nload its car#o, to pre"ision it or

to per$orm s!ch other chores ordinarily incident to the docin# o$ the ship

at a certain port. /t was the $ear o$ / interdiction, not any action taen

by the seamen on board the "essel which led the shipowners to yield.

he S<5s concl!sion that it is /5s policy not to inter"ene with the pli#ht

o$ crewmembers o$ a "essel !nless its inter"ention was so!#ht is witho!t

basis. his -o!rt is co#niCant o$ the $act that d!rin# the period co"ered by

the labor contro"ersies in Ballem Philippines Shippin#, /nc. ". Minister o$

'abor 192 S-R( 8;J1D81K% ir:len Shippin# and Marine Ser"ices, /nc. ".

'R- s!pra3 and these consolidated petitions, the / was militantworldwide especially in -anada, (!stralia, Scandina"ia, and "ario!s

0!ropean co!ntries, interdictin# $orei#n "essels and demandin# wa#e

increases $or third world seamen. here was no need $or ilipino or other

seamen to see / inter"ention. he / was waitin# on its own "olition in

all -anadian ports, not partic!larly $or the petitioners5 "essel b!t $or all

ships similarly sit!ated. (s earlier stated, the / was not really actin# $or

the petitioners o!t o$ p!re altr!ism. he / was merely protectin# the

interests o$ its own members. he petitioners happened to be pawns in ahi#her and broader str!##le between the / on one hand and shipowners

and third world seamen, on the other. o s!b+ect o!r seamen to criminal

prosec!tion and p!nishment $or ha"in# been ca!#ht in s!ch a str!##le is

o!t o$ the !estion.

(s stated in ir:Een Shippin# s!pra3F

he seamen had done no act which !nder Philippine law or any other

ci"iliCed law wo!ld be termed ille#al, oppressi"e, or malicio!s. Bhate"erpress!re eAisted, it was mild compared to accepted and "alid modes o$

labor acti"ity. at pa#e ;D13

i"en these $act!al sit!ations, there$ore, we cannot a*rm the S< and

'R-5s ndin# that there was "iolence, physical or otherwise employed

by the petitioners in demandin# $or additional wa#es. he $act that the

petitioners placed placards on the #an#way o$ their ship to show s!pport

$or /5s demands $or wa#e di&erentials $or their own benet and theres!ltin# /5s threatened interdiction do not constit!te "iolence. he

petitioners were eAercisin# their $reedom o$ speech and eApressin#

sentiments in their hearts when they placed the placard Be Bant /



Rates. >nder the $acts and circ!mstances o$ these petitions, we see no

reason to depri"e the seamen o$ their ri#ht to $reedom o$ eApression

#!aranteed by the Philippine -onstit!tion and the $!ndamental law o$

-anada where they happened to eAercise it.

(s we ha"e r!led in Ballem Phil. Shippin# /nc. ". Minister o$ 'abor, et al

s!praF

5Petitioner claims that the dismissal o$ pri"ate respondents was +!stied

beca!se the latter threatened the ship a!thorities in accedin# to their

demands, and this constit!tes serio!s miscond!ct as contemplated by the

'abor -ode. his contention is now well:taen. he records $ail to

establish clearly the commission o$ any threat. <!t e"en i$ there had been

s!ch a threat, respondents5 beha"ior sho!ld not be cens!red beca!se it is

b!t nat!ral $or them to employ some means o$ pressin# their demands $or

petitioner, who re$!sed to abide with the terms o$ the Special (#reement,

to honor and respect the same. hey were only actin# in the eAercise o$

their ri#hts, and to depri"e them o$ their $reedom o$ eApression is

contrary to law and p!blic policy. . . . at pa#e 843

Be liewise, nd the p!blic respondents5 concl!sions that the acts o$ the

petitioners in demandin# and recei"in# wa#es o"er and abo"e the rates

appearin# in their S<:appro"ed contracts is in e&ect an alteration o$

their "alid and s!bsistin# contracts beca!se the same were not obtainedthro!#h m!t!al consent and witho!t the prior appro"al o$ the S< to be

witho!t basis, not only beca!se the pri"ate respondent5s consent to pay

additional wa#es was not "itiated by any "iolence or intimidation on the

part o$ the petitioners b!t beca!se the said S<:appro"ed $orm contracts

are not !nalterable contracts that can ha"e no room $or impro"ement

d!rin# their e&ecti"ity or which ban any amendments d!rin# their term.

or one thin#, the employer can always impro"e the worin# conditionswitho!t "iolatin# any law or stip!lation.

Be stated in the ir:Een case s!pra3 thatF

he $orm contracts appro"ed by the ational Seamen <oard are

desi#ned to protect ilipino seamen not $orei#n shipowners who can tae

care o$ themsel"es. he standard $orms embody the basic minim!ms

which m!st be incorporated !s parts o$ the employment contract.

Section 1;, R!le , R!les and Re#!lations /mplementin# the 'abor -ode3. hey are not collecti"e bar#ainin# a#reements or illimitable contracts

which the parties cannot impro"e !pon or modi$y in the co!rse o$ the

a#reed period o$ time. o state, there$ore, that the a&ected seamen



cannot petition their employer $or hi#her salaries d!rin# the 12 months

d!ration o$ the contract r!ns co!nter to established principles o$ labor

le#islation. he ational 'abor Relations -ommission, as the appellate

trib!nal $rom the decisions o$ the ational Seamen <oard, correctly r!led

that the seamen did not "iolate their contracts to warrant their dismissal.

at pa#e ;8D3

/t is impractical $or the S< to re!ire the petitioners, ca!#ht in the

middle o$ a labor str!##le between the / and owners o$ ocean #oin#

"essels hal$way aro!nd the world in anco!"er, <ritish -ol!mbia to rst

sec!re the appro"al o$ the S< in Manila be$ore si#nin# an a#reement

which the employer was willin# to si#n. /t is also totally !nrealistic to

eApect the petitioners while in -anada to eAhibit the will and stren#th to

oppose the /5s demand $or an increase in their wa#es, ass!min# they

were so minded.

(n eAamination o$ (nneA - o$ the petition, the a#reement si#ned in Eapan

by the crewmembers o$ the M@ race Ri"er and a certain M. abei,

representati"e o$ the Eapanese shipowner lends credence to the

petitioners5 claim that the cla!se which amo!nts3 was recei"ed and held

by -R0BM0M<0RS in tr!st $or S=/POB0R was an intercalation added

a$ter the eAec!tion o$ the a#reement. he cla!se appears too closely

typed below the names o$ the 1D crewmen and their wa#es with nosimilar inter"enin# space as that which appears between all the

para#raphs and the triple space which appears between the list o$

crewmembers and their wa#es on one hand and the para#raph abo"e

which introd!ces the list, on the other. he "erb were was also inserted

abo"e the "erb was to mae the cla!se #rammatically correct b!t the

insertion o$ were is already on the same line as (ntonio Miranda and

;,221.96 where it clearly does not belon#. here is no other space where

the word were co!ld be intercalated. See Rollo, pa#e 893.(t any rate, the proposition that the petitioners sho!ld ha"e pretended to

accept the increased wa#es while in anco!"er b!t ret!rned them to the

shipowner when they reached its co!ntry, Eapan, has already been

answered earlier by the -o!rtF

ilipino seamen are admittedly as competent and reliable as seamen

$rom any other co!ntry in the world. Otherwise, there wo!ld not be so

many o$ them in the "essels sailin# in e"ery ocean and sea on this #lobe./t is competence and reliability, not cheap labor that maes o!r seamen

so #reatly in demand. ilipino seamen ha"e ne"er demanded the same

hi#h salaries as seamen $rom the >nited States, the >nited in#dom,



Eapan and other de"eloped nations. <!t certainly they are entitled to

#o"ernment protection when they as $or $air and decent treatment by

their employer and when they eAercise the ri#ht to petition $or impro"ed

terms o$ employment, especially when they $eel that these are s!b:

standard or are capable o$ impro"ement accordin# to internationally

accepted r!les. /n the domestic scene, there are mar#inal employers who

prepare two sets o$ payrolls $or their employees G one in eepin# with

minim!m wa#es and the other recordin# the s!b:standard wa#es that the

employees really recei"e. he reliable employers, howe"er, not only meet

the minim!ms re!ired by $air labor standards le#islation b!t e"en so

away abo"e the minim!ms while earnin# reasonable prots and

prosperin#. he same is tr!e o$ international employment. here is no

reason why this co!rt and the Ministry o$ 'abor and 0mployment or its

a#encies and commissions sho!ld come o!t with prono!ncements based

on the standards and practices o$ !nscr!p!lo!s or ine*cient shipowners,

who claim they cannot s!r"i"e witho!t resortin# to tricy and decepti"e

schemes, instead o$ o"ernment maintainin# labor law and +!rispr!dence

accordin# to the practices o$ honorable, competent, and law:abidin#

employers, domestic or $orei#n. ir:Een Shippin#, s!pra, pp. ;87:;883

/t is noteworthy to emphasiCe that while the /nternational 'abor

Or#aniCation /'O3 set the minim!m basic wa#e o$ able seamen at

>S\187.99 as early as October 1D76, it was only in 1D7D that therespondent S< iss!ed Memo -irc!lar o. 4;, en+oinin# all shippin#

companies to adopt the said minim!m basic wa#e. /t was correct $or the

respondent S< to state in its decision that when the petitioners entered

into separate contracts between 1D77:1D78, the monthly minim!m basic

wa#e $or able seamen ordered by S< was still Aed at >S\19.99.

=owe"er, it is not the $a!lt o$ the petitioners that the S< not only

"iolated the 'abor -ode which created it and the R!les and Re#!lations

/mplementin# the 'abor -ode b!t also sees to p!nish the seamen $or ashortcomin# o$ S< itsel$.

(rticle 21c3 o$ the 'abor -ode, when it created the S<, mandated the

<oard to O3btain the best possible terms and conditions o$ employment

$or seamen.

Section 1;, R!le o$ <oo / o$ the R!les and Re#!lations /mplementin#

the 'abor -ode pro"idesF

Sec. 1;. Model contract o$ employment. G he S< shall de"ise a model

contract o$ employment which shall embody all the re!irements o$

pertinent labor and social le#islation5s and the pre"ailin# standards set by



applicable /nternational 'abor Or#aniCation -on"entions. he model

contract shall set the minim!m standards o$ the terms and conditions to

#o"ern the employment o$ ilipinos on board "essels en#a#ed in o"erseas

trade. (ll employers o$ ilipinos shall adopt the model contract in

connection with the hirin# and en#a#ement o$ the ser"ices o$ ilipino

sea$arers, and in no case shall a shipboard employment contract be

allowed where the same pro"ides $or benets less than those en!merated

in the model employment contract, or in any way conWicts with any other

pro"isions embodied in the model contract.

Section 18 o$ R!le / o$ the same R!les and Re#!lations pro"idesF

Sec. 18. <asic minim!m salary o$ able:seamen. G he basic minim!m

salary o$ seamen shall be not less than the pre"ailin# minim!m rates

established by the /nternational 'abor Or#aniCation or those pre"ailin# in

the co!ntry whose Wa# the employin# "essel carries, whiche"er is hi#her.

=owe"er, this pro"ision shall not apply i$ any shippin# company pays its

crew members salaries abo"e the minim!m herein pro"ided.

Section 8, R!le Q, <oo / o$ the Omnib!s R!les pro"idesF

Section 8. >se o$ standard $ormat o$ ser"ice a#reement. G he <oard

shall adopt a standard $ormat o$ ser"ice a#reement in accordance5s with

pertinent labor and social le#islation and pre"ailin# standards set byapplicable /nternational 'abor Or#aniCation -on"entions. he standard

$ormat shall set the minim!m standard o$ the terms and conditions to

#o"ern the employment o$ ilipino sea$arers b!t in no case shall a

shipboard employment contract sic3, or in any way conWict with any

other pro"ision embodied in the standard $ormat.

/t too three years $or the S< to implement re!irements which, !nder

the law, they were obli#ed to $ollow and eAec!te immediately. )!rin#

those three years, the incident in anco!"er happened. he terms andconditions a#reed !pon in anco!"er were well within /'O rates e"en i$

they were abo"e S< standards at the time.

he sanctions applied by S< and a*rmed by 'R- are moreo"er not in

eepin# with the basic premise that this -o!rts stressed in the ir:Een

Shippin# case s!pra3 that the Ministry new the )epartment o$ 'abor and

0mployment and all its a#encies eAist primarily $or the worin#man5s

interest and the nation5s as a whole.

/mplicit in these petitions and the only reason $or the S< to tae the side

o$ $orei#n shipowners a#ainst ilipino seamen is the illin# the #oose



which lays the #olden e##s ar#!ment. Be reiterate the r!lin# o$ the

-o!rt in ir:Een Shippin# s!pra3

here are "ario!s ar#!ments raised by the petitioners b!t the common

thread r!nnin# thro!#h all o$ them is the contention, i$ not the dismal

prophecy, that i$ the respondent seaman are s!stained by this -o!rt, we

wo!ld in e&ect 5ill the hen that lays the #olden e##.5 /n other words,ilipino seamen, admittedly amon# the best in the world, sho!ld remain

satised with relati"ely lower i$ not the lowest, international rates o$

compensation, sho!ld not a#itate $or hi#her wa#es while their contracts

o$ employment are s!bsistin#, sho!ld accept as sacred, iron clad, and

imm!table the side contracts which re!ire them to $alsely pretend to be

members o$ international labor $ederations, pretend to recei"e hi#her

salaries at certain $orei#n ports only to ret!rn the increased pay once the

ship lea"es that port, sho!ld stiWe not only their ri#ht to as $or impro"edterms o$ employment b!t their $reedom o$ speech and eApression, and

sho!ld s!&er instant termination o$ employment at the sli#htest si#n o$

dissatis$action with no protection $rom their o"ernment and their co!rts.

Otherwise, the petitioners contend that ilipinos wo!ld no lon#er be

accepted as seamen, those employed wo!ld lose their +obs, and the still

!nemployed wo!ld be le$t hopeless.

his is not the rst time and it will not be the last where the threat o$ !nemployment and loss o$ +obs wo!ld be !sed to ar#!e a#ainst the

interests o$ labor% where e&orts by worin#men to better their terms o$

employment wo!ld be characteriCed as pre+!dicin# the interests o$ labor

as a whole.

AAA AAA AAA

>nionism, employers5 liability acts, minim!m wa#es, wormen5s

compensation, social sec!rity and collecti"e bar#ainin# to name a $ewwere all initially opposed by employer5 and e"en well meanin# leaders o$

#o"ernment and society as 5illin# the hen or #oose which lays the #olden

e##s.5 he claims o$ worin#men were described as o!tra#eo!sly

in+!rio!s not only to the employer b!t more so to the employees

themsel"es be$ore these claims or demands were established by law and

+!rispr!dence as 5ri#hts5 and be$ore these were pro"ed benecial to

mana#ement, labor, and the national as a whole beyond reasonable

do!bt.

he case be$ore !s does not represent any ma+or ad"ance in the ri#hts o$

labor and the worin#men. he pri"ate respondents merely so!#ht ri#hts



already established. o matter how m!ch the petitioner:employer tries to

present itsel$ as speain# $or the entire ind!stry, there is no e"idence that

it is typical o$ employers hirin# ilipino seamen or that it can spea $or

them.

he contention that mannin# ind!stries in the Philippines wo!ld not

s!r"i"e i$ the instant case is not decided in $a"or o$ the petitioner is nots!pported by e"idence. he Ballem case was decided on ebr!ary 29,

1D81. here ha"e been no se"ere reperc!ssions, no di"in# !p o$

employment opport!nities $or seamen, and none o$ the dire

conse!ences repeatedly emphasiCed by the petitioner. Bhy sho!ld ir:

Een be an eAception

he wa#es o$ seamen en#a#ed in international shippin# are sho!ldered

by the $orei#n principal. he local mannin# o*ce is an a#ent whose

primary $!nction is recr!itment end who !s!ally #ets a l!mp s!m $rom

the shipowner to de$ray the salaries o$ the crew. he hirin# o$ seamen

and the determination o$ their compensation is s!b+ect to the interplay o$

"ario!s maret $actors and one ey $actor is how m!ch in terms o$ prots

the local meanin# o*ce and the $orei#n shipowner may realiCe a$ter the

costs o$ the "oya#e are met. (nd costs incl!de salaries o$ o*cers and

crew members. at pp. ;8;:;863

he Ballem Shippin# case, was decided in 1D81. ir:Een Shippin# wasdecided in 1D8. /t is now 1D8D. here has been no dryin# !p o$

employment opport!nities $or ilipino seamen. ot only ha"e their wa#es

impro"ed th!s lendin# / to be placid and !iet all these years inso$ar as

ilipinos are concerned b!t the hirin# o$ Philippine seamen is at its hi#hest

le"el e"er.

Reportin# its acti"ities $or the year 1D88, the Philippine O"erseas

0mployment (dministration PO0(3 stated that there will be en increasein demand $or seamen based o"erseas in 1D8D boostin# the n!mber to as

hi#h as 19;,999. his will represent a D.; percent increase $rom the 1D88

a##re#ate. <!siness Borld, ews <rie$s, Ean!ary 11, 1D8D at pa#e 23

(ccordin# to the PO0(, seabased worers n!mberin# D;,D1 in 1D88

eAceeded by a wide mar#in o$ 28.1; percent the year end total in 1D87.

he report shows that seabased worers posted bi##er monthly

increments compared to those o$ landbesed worers. he <!siness Star,

/ndicators, Ean!ary 11, 1D88 at pa#e 23

(!#mentin# this optimistic report o$ PO0( (dministrator omas (chacoso

is the statement o$ Secretary o$ 'abor ranlin M. )rilon that the



Philippines has a bi# +!mp o"er other crewin# nations beca!se o$ the

ilipinos5 abilities compared with any 0!ropean or western crewin#

co!ntry. )rilon added that cr!ise shippin# is also a #rowin# maret $or

ilipino sea$arers beca!se o$ their WeAibility in handlin# odd +obs and their

eApertise in handlin# almost all types o$ ships, incl!din# l!A!ry liners.

Manila <!lletin, More ilipino Seamen 0Apected )eployment )ecember

27, 1D88 at pa#e 2D3. Parenthetically, the minim!m monthly salary o$

able bodied seamen set by the /'O and adhered to by the Philippines is

now \276.99 id.3 more than do!ble the \19.99 so!#ht to be en$orced

by the p!blic respondents in these petitions.

he eAperience $rom 1D81 to the present "indicates the ndin# in ir:Een

Shippin# that a decision in $a"or o$ the seamen wo!ld not necessarily

mean se"ere reperc!ssions, dryin# !p o$ employment opport!nities $or

seamen, and other dire conse!ences predicted by mannin# a#enciesand recr!iters in the Philippines.

rom the $ore#oin#, we nd that the S< and 'R- committed #ra"e

ab!se o$ discretion in ndin# the petitioners #!ilty o$ !sin# intimidation

and ille#al means in breachin# their contracts o$ employment and

p!nishin# them $or these alle#ed o&enses. -onse!ently, the criminal

prosec!tions $or esta$a in .R. os. ;7DDD and ;814:; sho!ld be

dismissed.B=0R0OR0, the petitions are hereby R(0). he decisions o$ the

ational Seamen <oard and ational 'abor Relations -ommission in . R.

os. 64781:DD are R00RS0) and S0 (S/)0 and a new one is entered

holdin# the petitioners not #!ilty o$ the o&enses $or which they were

char#ed. he petitioners5 s!spension $rom the ational Seamen <oard5s

Re#istry $or three 3 years is '/0). he pri"ate respondent is ordered

to pay the petitioners their earned b!t !npaid wa#es and o"ertime

pay@allowance $rom o"ember 1, 1D78 to )ecember 14, 1D78 accordin#to the rates in the Special (#reement that the parties entered into in

anco!"er, -anada.

he criminal cases $or esta$a, s!b+ect matter o$ . R. os. ;7DDD and

;814:;, are ordered )/SM/SS0).

SO OR)0R0).

ar"asa, Melencio:=errera, -r!C, Paras, ancayco, Padilla, <idin,Sarmiento, -ortes, ri[o:(!ino, Medialdea and Re#alado, EE., conc!r.

ernan, -.E.3 on o*cial lea"e.



eliciano, E., too no part. / was a director o$ pri"ate respondent corp.



/RS )//S/O

J.R. o. 822;2. ebr!ary 28, 1D8D.K

S0(>'' M(R//M0 -ORP. () P=/'/M(R0 S=/PP/ ? 0V>/PM0

S>PP'N, petitioners, "s. 0RRN ). <('(O(, (/O(' '(<OR

R0'(/OS -OMM/SS/O () P=/'/PP/0 O0RS0(S 0MP'ONM0

()M//SR(/O, respondents.

an+!atco, Oreta, an+!atco, <eren#!er ? San icente $or petitioners.

he Solicitor eneral $or p!blic respondent.

<en+amin <. er#ara $or pri"ate respondent.

SN''(<>S

1. '(<OR '(B% 0MP'ONM0 -OR(-% M>S <0 S><M/0) O =0PO0( OR (PPRO('% R0(SO% S>PP'0M0(RN -OR(- PRO/)/

OR MOR0 <00/S O =0 BOR0RS, )0-'(R0) ('/) ()

0OR-0(<'0 00 B/=O> (PPRO(' O =0 PO0(. G he

s!pplementary contract o$ employment was entered into between

petitioner and pri"ate respondent to modi$y the ori#inal contract o$

employment. he reason why the law re!ires that the PO0( sho!ld

appro"e and "eri$y a contract !nder (rticle 4i3 o$ the 'abor -ode is to

ins!re that the employee shall not thereby be placed in adisad"anta#eo!s position and that the same are within the minim!m

standards o$ the terms and conditions o$ s!ch employment contract set

by the PO0(. his is why a standard $ormat $or employment contracts has

been adopted by the )epartment o$ 'abor. =owe"er, there is no

prohibition a#ainst stip!latin# in a contract more benets to the

employee than those re!ired by law. h!s, in this case wherein a

s!pplementary contract was entered into a&ordin# #reater benets to

the employee than the pre"io!s one, and altho!#h the same was not

s!bmitted $or the appro"al o$ the PO0(, the p!blic respondents properly

considered said contract to be "alid and en$orceable. /ndeed, said

prono!ncements o$ p!blic respondents ha"e the e&ect o$ an appro"al o$

said contract. Moreo"er, as said contract was "ol!ntarily entered into by

the parties the same is bindin# between them. ot bein# contrary to law,

morals, #ood c!stoms, p!blic policy or p!blic order, its "alidity m!st be

s!stained.

2. /).% /).% PRO/S/O O B(/0R ((/S ('' -'(/MS ((/S =0

0MP'ON0R, =0') -OR(RN O P><'/- PO'/-N. G he co!rt s!stains the

r!lin# o$ p!blic respondents that the pro"ision in the s!pplementary



contract whereby pri"ate respondent wai"es any claim a#ainst petitioners

$or dama#es arisin# $rom death or permanent disability is a#ainst p!blic

policy, oppressi"e and inimical to the ri#hts o$ pri"ate respondent. he

said pro"ision de$eats and is inconsistent with the d!ty o$ petitioners to

ins!re pri"ate respondent a#ainst said contin#encies as clearly stip!lated

in the said contract.

. /).% /).% /)/S O (- O '(<OR R/<>('S, -O-'>S/0%

0MP'ON0R '/(<'0 O P(N -'(/M O 0MP'ON00 / -(S0 O )0(= OR

(--/)0 B=/-= O-->RR0) )>R/ =/S 0MP'ONM0. G his -o!rt is

not a trier o$ $acts and the ndin#s o$ the p!blic respondents are

concl!si"e in this proceedin#. P!blic respondents $o!nd that petitioner

Philimare and pri"ate respondent, entered into said s!pplementary

contract o$ employment on )ecember 6, 1D82. (ss!min# $or the sae o$

ar#!ment that it was petitioners5 principal which entered into saidcontract with pri"ate respondent, ne"ertheless petitioner, as its mannin#

a#ent in the Philippines, is +ointly responsible with its principal there!nder.

here is no !estion that !nder the said s!pplementary contract o$

employment, it is the d!ty o$ the employer, petitioners herein, to ins!re

the employee, d!rin# his en#a#ement, a#ainst death and permanent

in"alidity ca!sed by accident on board !p to \;9,999.99. -onse!ently, it

is also its concomitant obli#ation to see to it that the claim a#ainst the

ins!rance company is d!ly led by pri"ate respondent or in his behal$,and within the time pro"ided $or by the terms o$ the ins!rance contract. /n

this case, the pri"ate respondent met the accident on October 6, 1D8.

Since then, he was hospitaliCed at the S!eC -anal (!thority =ospital and

therea$ter he was repatriated to the Philippines wherein he was also

hospitaliCed $rom October 22, 1D8 to March 27, 1D84. /t was only on

(!#!st 1D, 1D8; that he was iss!ed a medical certicate describin# his

disability to be permanent in nat!re. /t was not possible $or pri"ate

respondent to le a claim $or permanent disability with the ins!rancecompany within the one:year period $rom the time o$ the in+!ry, as his

disability was ascertained to be permanent only therea$ter. Petitioners did

not eAert any e&ort to assist pri"ate respondent to reco"er payment o$ his

claim $rom the ins!rance company. hey did not e"en care to disp!te the

ndin# o$ the ins!rer that the claim was not led on time. Petitioners

m!st, there$ore, be held responsible $or its omission, i$ not ne#li#ence, by

re!irin# them to pay the claim o$ pri"ate respondent.

) 0 - / S / O

(-(N-O, E pF



On o"ember 2, 1D82, a -rew (#reement was entered into by pri"ate

respondent erry ). <alaton#an and Philimare Shippin# and 0!ipment

S!pply hereina$ter called Philimare whereby the latter employed the

$ormer as able seaman on board its "essel Santa -r!C renamed !rtle

<ay3 with a monthly salary o$ >S\99.99. Said a#reement was processed

and appro"ed by the ational Seaman5s <oard S<3 on o"ember ,

1D82. 1

Bhile on board said "essel the said parties entered into a s!pplementary

contract o$ employment on )ecember 6, 1D82 2 which pro"ides amon#

othersF

1. he employer shall be obli#ed to ins!re the employee d!rin# his

en#a#ement a#ainst death or permanent in"alidity ca!sed by accident on

board !p toF

>S \49,999 G $or death ca!sed by accident

>S \;9,999 G $or permanent total disability ca!sed by accident.

On October 6, 1D8 <alaton#an met an accident in the S!eC -anal, 0#ypt

as a res!lt o$ which he was hospitaliCed at S!eC -anal (!thority =ospital.

'ater, he was repatriated to the Philippines and was hospitaliCed at the

Maati Medical -enter $rom October 2, 1D8 to March 27, 1D84. On

(!#!st 1D, 1D8; the medical certicate was iss!ed describin# hisdisability as permanent in nat!re.

<alaton#an demanded payment $or his claim $or total disability ins!rance

in the amo!nt o$ >S \;9,999.99 as pro"ided $or in the contract o$

employment b!t his claim was denied ha"in# been s!bmitted to the

ins!rers beyond the desi#nated period $or doin# so.

h!s, <alaton#an led on E!ne 21, 1D8; a complaint a#ainst Philimare

and Sea#!ll Maritime -orporation hereina$ter called Sea#!ll3 in the

Philippine O"erseas 0mployment (dministration PO0(3 $or non:payment

o$ his claim $or permanent total disability with dama#es and attorney5s

$ees.

($ter the parties s!bmitted their respecti"e position papers with the

correspondin# doc!mentary e"idence, the o*ce char#e o$ the Borers

(ssistance and (d+!dication O*ce o$ the PO0( rendered a decision on

May 2, 1D86, the dispositi"e part o$ which reads as $ollowsF



B=0R0OR0, premises considered, respondents are hereby ordered to

pay complainant the amo!nt o$ >S\;9,999.99 representin# permanent

total disability ins!rance and attorney5s $ees at 19X o$ the award.

Payment sho!ld be made in this O*ce within ten 193 days $rom receipt

hereo$ at the pre"ailin# rate o$ eAchan#e. his O*ce cannot howe"er r!le

on dama#es, ha"in# no +!risdiction on the matter.

SO OR)0R0). 4

Sea#!ll and Philimare appealed said decision to the ational 'abor

Relations -ommission 'R-3 on E!ne 4, 1D86. Pendin# resol!tion o$ their

appeal beca!se o$ the alle#ed trans$er o$ the a#ency o$ Sea#!ll to

So!theast (sia Shippin# -orporation, Sea#!ll led on (pril 28, 1D87 a

Motion or S!bstit!tion@/ncl!sion o$ Party Respondent which was opposed

by <alaton#an. ; his was $ollowed by an eA:parte motion $or lea"e to le

third party complaint on E!ne 4, 1D87 by Sea#!ll. ( decision was

prom!l#ated on )ecember 7, 1D87 denyin# both motions and dismissin#

the appeal $or lac o$ merit. 6 ( motion $or reconsideration o$ said

decision was denied $or lac o$ merit in a resol!tion dated ebr!ary 26,

1D88. 7

=ence, Sea#!ll and Philimare led this petition $or certiorari with a prayer

$or the iss!ance o$ a temporary restrainin# order based on the $ollowin#

#ro!ndsF

1. Respondent PO0( erred in applyin# the S!pplemental -ontract%

2. Respondents PO0( and 'R- acted with #ra"e ab!se o$ discretion in

holdin# that the S!pplemental -ontract was si#ned on board M Santa

-r!C by and between pri"ate respondent and $rom petitioner% and

. Respondent 'R- acted with #ra"e ab!se o$ discretion in not #i"in#

d!e co!rse to yo!r petitioners5 Motion $or 'ea"e to ile hird Party-omplaint as well as their Motion $or /ncl!sion@S!bstit!tion o$

respondents. 8

On March 21, 1D88, the -o!rt iss!ed a temporary restrainin# order

en+oinin# respondents $rom en$orcin# the !estioned decision and

resol!tion o$ p!blic respondents.

Petitioners ar#!e that prior to pri"ate respondent5s depart!re he eAec!ted

a crew a#reement on o"ember 2, 1D82 which was d!ly appro"ed by thePO0(% that the s!pplementary contract o$ employment that was entered

into on board the "essel !rtle <ay which pro"ides $or a >S \;9,999.99

ins!rance benet in case o$ permanent disability was neither appro"ed



nor "eried by respondent PO0(% and that the same "iolates (rticle 4i3

o$ the 'abor -ode, as amended, which pro"ides as $ollowsF

(rt. 4. Prohibited Practices. G /t shall be !nlaw$!l $or any indi"id!al,

entity, licensee, or holder o$ a!thorityF

AAA AAA AAA

i3 to s!bstit!te or alter employment contracts appro"ed and "eried

by the )epartment o$ 'abor $rom the time o$ act!al si#nin# thereo$ by the

parties !p to and incl!din# the period o$ eApiration o$ the same witho!t

the appro"al o$ the )epartment o$ 'abor.

Petitioners also call attention to (rticle ///, para#raph 2 o$ the

S!pplementary -ontract which pro"ides as $ollowsF

2. otwithstandin# his claim a#ainst the ins!rers the employee herebyeApressly wai"es all claims o$ his own or his heirs $or compensation o$

dama#es d!e to death or permanent in"alidity which he s!&ered d!rin#

his en#a#ement a#ainst the employers . . . !nless his death or permanent

in"alidity has been ca!sed by will$!l act o$ any o$ the abo"e:named

persons. D

Petitioners stress that while p!blic respondents !pheld the applicability o$

said s!pplementary contract inso$ar as it increased the benets to pri"aterespondent, p!blic respondents considered the pro"ision on the wai"er

a#ainst all claims by pri"ate respondent to be contrary to p!blic policy.

/n its !estioned decision dated )ecember 7, 1D87, the respondent 'R-

made the $ollowin# dis!isitionF

he $ocal iss!e $or determination is the "alidity and en$orceability o$ the

second contract o$ employment entered into by and between complainant

and respondents on board the "essel where the $ormer had ser"ed as amember o$ its complement despite the absence o$ S< "erication or

appro"al. Bith respect to the ndin#s o$ $acts in the appealed decision,

Be consider the same as d!ly s!pported by s!bstantial e"idence and the

admissions o$ the parties in pleadin#s. ''phil

M!ch stress and emphasis are made by the respondents in their appeal

that this claim has no le#al basis or $ootin# inasm!ch as the second

contract o$ employment containin# a total disability ins!rance benet o$

>S\;9,999.99, m!ch more than that embodied in the rst contract o$

employment which was appro"ed by the de$!nct S<, was not "eried or

appro"ed by the latter. (ccordin#ly, the respondents posit the ar#!ment



that s!b+ect claim may not prosper p!rs!ant to the pro"isions o$ (rt. 4i3

o$ the 'abor -ode, as amended, which pro"ides that it shall be !nlaw$!l

$or any indi"id!al, entity, licensee, or holder o$ a!thority 53o s!bstit!te

or alter employment contracts appro"ed and "eried by the )epartment

o$ 'abor $rom the time o$ act!al si#nin# thereo$ by the parties !p to and

incl!din# the period o$ eApiration o$ the same witho!t the appro"al o$ the

)epartment o$ 'abor.

)id the PO0( commit a re"ersible error when it considered the second

contract o$ employment as "alid sans any "erication or appro"al thereo$

by the S< O!r answer to this !ery is in the ne#ati"e. (pparently, the

intention o$ the law when (rt. 4 o$ the 'abor -ode was enacted is to

pro"ide $or the prohibited and !nlaw$!l practices relati"e to recr!itment

and placement. (s shown in the 50Aplanatory ote5 o$ Parliamentary <ill

o. 4;1, pertainin# to (rt. 4 s!pra3, th!sF

Many o$ the pro"isions are already eAistin# and were simply restated.

Some howe"er were restated with modications and new ones were

introd!ced to reWect what in the past ha"e been noted to be pernicio!s

practices which tend to place worers at a disad"anta#e.

it is ind!bitably clear that the p!rpose o$ ha"in# o"erseas contracts o$

employment appro"ed by the S<PO0(3 is whether or not s!ch contracts

con$orm to the minim!m terms and conditions prescribed by the S<PO0(3. /n other words, the law did not at all prohibit any alteration which

pro"ided $or increases in wa#es or other benets "ol!ntarily #ranted by

the employer. Precisely, !nder Section 2, R!le 1, <oo o$ the R!les and

Re#!lations o$ the PO0( 5t3he standard $ormat o$ employment contracts

shall set the minim!m standards o$ the terms and conditions o$

employment. (ll employers and principals shall adopt the model contract

in connection with the hirin# o$ worers witho!t pre+!dice to their

adoptin# other terms and conditions o$ employment o"er and abo"e theminim!m standards o$ the (dministration.5 Bhere, as here, it is admitted

that the second contract altho!#h not "eried or appro"ed by the S<

PO0(3 #ranted more benets by way o$ total disability ins!rance to the

complainant, the respondents may not be allowed to disa"ow their own

"ol!ntary acts by insistin# that s!ch benecial contract in $a"or o$ the

seaman is n!ll and "oid. 0mphasis s!pplied.3 19

Be a#ree.

he s!pplementary contract o$ employment was entered into between

petitioner and pri"ate respondent to modi$y the ori#inal contract o$



employment. he reason why the law re!ires that the PO0( sho!ld

appro"e and "eri$y a contract !nder (rticle 4i3 o$ the 'abor -ode is to

ins!re that the employee shall not thereby be placed in a

disad"anta#eo!s position and that the same are within the minim!m

standards o$ the terms and conditions o$ s!ch employment contract set

by the PO0(. his is why a standard $ormat $or employment contracts has

been adopted by the )epartment o$ 'abor. =owe"er, there is no

prohibition a#ainst stip!latin# in a contract more benets to the

employee than those re!ired by law. h!s, in this case wherein a

s!pplementary contract was entered into a&ordin# #reater benets to

the employee than the pre"io!s one, and altho!#h the same was not

s!bmitted $or the appro"al o$ the PO0(, the p!blic respondents properly

considered said contract to be "alid and en$orceable. /ndeed, said

prono!ncements o$ p!blic respondents ha"e the e&ect o$ an appro"al o$

said contract. Moreo"er, as said contract was "ol!ntarily entered into by

the parties the same is bindin# between them. 11 ot bein# contrary to

law, morals, #ood c!stoms, p!blic policy or p!blic order, its "alidity m!st

be s!stained. 12 <y the same toen, the co!rt s!stains the r!lin# o$

p!blic respondents that the pro"ision in the s!pplementary contract

whereby pri"ate respondent wai"es any claim a#ainst petitioners $or

dama#es arisin# $rom death or permanent disability is a#ainst p!blic

policy, oppressi"e and inimical to the ri#hts o$ pri"ate respondent. he

said pro"ision de$eats and is inconsistent with the d!ty o$ petitioners to

ins!re pri"ate respondent a#ainst said contin#encies as clearly stip!lated

in the said contract. ''pr

Petitioners howe"er ar#!e that they co!ld not ha"e entered into said

s!pplementary contract o$ employment as Philimare was a mere mannin#

a#ent in the Philippines o$ the shippin# company mana#ed by a"ales

Shippin# Mana#ement and Marine -ons!ltant Pte3 'td., its principal.

Petitioners assert that the said s!pplementary contract was entered intoby pri"ate respondent with their principal, a"ales Shippin# Mana#ement

and Marine -ons!ltant Pte3 'td. on board the "essel !rtle <ay so

petitioners cannot be held responsible there!nder.

his -o!rt is not a trier o$ $acts and the ndin#s o$ the p!blic respondents

are concl!si"e in this proceedin#. P!blic respondents $o!nd that petitioner

Philimare and pri"ate respondent, entered into said s!pplementary

contract o$ employment on )ecember 6, 1D82. (ss!min# $or the sae o$ ar#!ment that it was petitioners5 principal which entered into said

contract with pri"ate respondent, ne"ertheless petitioner, as its mannin#



a#ent in the Philippines, is +ointly responsible with its principal there!nder.

1

here is no !estion that !nder the said s!pplementary contract o$

employment, it is the d!ty o$ the employer, petitioners herein, to ins!re

the employee, d!rin# his en#a#ement, a#ainst death and permanent

in"alidity ca!sed by accident on board !p to \;9,999.99. -onse!ently, itis also its concomitant obli#ation to see to it that the claim a#ainst the

ins!rance company is d!ly led by pri"ate respondent or in his behal$,

and within the time pro"ided $or by the terms o$ the ins!rance contract.

/n this case, the pri"ate respondent met the accident on October 6, 1D8.

Since then, he was hospitaliCed at the S!eC -anal (!thority =ospital and

therea$ter he was repatriated to the Philippines wherein he was also

hospitaliCed $rom October 22, 1D8 to March 27, 1D84. /t was only on

(!#!st 1D, 1D8; that he was iss!ed a medical certicate describin# his

disability to be permanent in nat!re. /t was not possible $or pri"ate

respondent to le a claim $or permanent disability with the ins!rance

company within the one:year period $rom the time o$ the in+!ry, as his

disability was ascertained to be permanent only therea$ter. Petitioners did

not eAert any e&ort to assist pri"ate respondent to reco"er payment o$ his

claim $rom the ins!rance company. hey did not e"en care to disp!te the

ndin# o$ the ins!rer that the claim was not led on time. 14 Petitionersm!st, there$ore, be held responsible $or its omission, i$ not ne#li#ence, by

re!irin# them to pay the claim o$ pri"ate respondent. 'eA'ib

he -o!rt nds that the respondent 'R- did not commit a #ra"e ab!se

o$ discretion in denyin# petitioners5 motion $or lea"e to le third:party

complaint and s!bstit!tion or incl!sion o$ party respondent. S!ch motion

is lar#ely addressed to the discretion o$ the said -ommission. /nasm!ch

as the alle#ed trans$er o$ interest too place only a$ter the PO0( had

rendered its decision, the denial o$ the motion so as to a"oid $!rther delayin the settlement o$ the claim o$ pri"ate respondent was well:taen. (t

any rate, petitioners may p!rs!e their claim a#ainst their alle#ed

s!ccessor:in:interest in a separate s!it.

B=0R0OR0, the petition is hereby )/SM/SS0) $or lac o$ merit and the

temporary restrainin# order iss!ed by this -o!rt on March 21, 1D88 is

hereby '/0). o costs. his decision is immediately eAec!tory.

SO OR)0R0).

ar"asa, -r!C, ri[o:(!ino and Medialdea, EE., conc!r.



=/R) )//S/O

J.R. o. 11D29. March 1, 1DD8.K

O-0( 0(S (0-N -ORP., 0>ROP0( (/(/O, /-. ? S()(R)

/S>R(-0 -O., /-., petitioners, "s. =0 (/O(' '(<OR R0'(/OS

-OMM/SS/O 'R-:/RS )//S/O3, and -(P. P0P/O M. >-OR,

respondents.

Potenciano R. apenas $or petitioners.

Ro#er S. <oni$acio $or pri"ate respondent.

SNOPS/S

Respondent -apt. !cor was hired by petitioner Ocean 0ast as master o$

M@ (lpine $or one year. Bhile the M@ (lpine was anchored at thePort o$ =a"ana, -!ba, respondent was in$ormed o$ his repatriation $or his

s!bse!ent trans$er to another "essel.

-apt. !cor re$!sed to lea"e the "essel, belie"in# the ca!se $or his

repatriation to be !nreasonable. Ocean 0ast and petitioner 0!ropean

a"i#ation ad"ised him that his ser"ices were not terminated, the

repatriation bein# solely $or doc!mentation p!rposes.

On the #ro!nd o$ serio!s miscond!ct or will$!l disobedience, petitionersterminated the ser"ices o$ -apt. !cor. Respondent led a complaint $or

ille#al dismissal, b!t the PO0( dismissed the complaint $or lac o$ merit

ndin# respondent5s apprehension as premat!re and that petitioners

were merely actin# in the eAercise o$ their mana#ement prero#ati"e.

)-c=a

On appeal, the decision o$ the PO0( was re"ersed by the 'R-. he

principal iss!e is whether or not the trans$er cla!se o$ the Standard

0mployment -ontract S0-3 is "iolati"e o$ (rticle 4i3 o$ the 'abor -ode.

he 'R- r!led that the intended trans$er o$ -apt. !cor to another

"essel was an alteration o$ his ori#inal contract which co!ld not be done

witho!t the appro"al o$ the Secretary o$ 'abor.

he 'R-5s r!lin# does not pers!ade. he Standard 0mployment -ontract

was adopted and appro"ed con$ormably with Section , R!le //, <oo o$

the PO0( R!les and Re#!lations. he trans$er cla!se !nder the S0- is not

inconsistent with (rticle 4i3 o$ the 'abor -ode. On the contrary, thetrans$er cla!se !nder the S0- e"en complements the 'abor -ode by way

o$ resol"in# the compleA demands o$ sea$arers whose ser"ices may entail



occasional trans$er $rom one "essel to another. ( trans$er is sanctioned

only i$ it is to any "essel owned or mana#ed by the same employer

pro"ided it is accredited to the same mannin# a#ent and that the ratin#

o$ the crewmember, his wa#es and terms o$ ser"ice are in no way in$erior

and the total period o$ employment shall not eAceed that ori#inally

a#reed !pon. he trans$er cla!se is deemed incorporated into the ori#inal

contract% hence, the appro"al o$ the Secretary o$ 'abor is no lon#er

necessary.

Petitioners merely a"ailed o$ what the employment contract allows.

SN''(<>S

1. '(<OR () SO-/(' '0/S'(/O% '(<OR -O)0% 0MP'ONM0%

0MP'ON0R:0MP'ON00 R0'(/OS=/P% 0Q/S0-0 =0R0O O 0(0)

<N 0QPR0SS'N R0P>)/(/ / / -OR(-. G /t is aAiomatic that theeAistence o$ an employer:employee relationship cannot be ne#ated by

eApressly rep!diatin# it in the mana#ement contract and pro"idin#

therein that the employee is an independent contractor when the terms

o$ the a#reement clearly show otherwise. or, the employment stat!s o$ a

person is dened and prescribed by law and not by what the parties say it

sho!ld be. /n determined the stat!s o$ the mana#ement contract, the

$o!r:$old test on employment has to be applied. -(aS0)

2. /).% /).% /).% O>R:O') 0S% S0'0-/O () 0(0M0 O

0MP'ON00. G Petitioner contends that )e los Reyes was ne"er re!ired to

#o thro!#h the pre:employment proced!res and that the probationary

employment stat!s was reser"ed only to employees o$ petitioner. On this

score, it insists that the rst re!irement o$ selection and en#a#ement o$

the employee was not met. ( loo at the pro"isions o$ the contract shows

that pri"ate respondent was appointed as (ctin# >nit Mana#er only !pon

recommendation o$ the )istrict Mana#er. his indicates that pri"aterespondent was hired by petitioner beca!se o$ the $a"orable endorsement

o$ its d!ly a!thoriCed o*cer. <!t, this approbation co!ld only ha"e been

based on the per$ormance o$ )e los Reyes as a#ent !nder the a#ency

contract so that there can be no other concl!sion arri"ed !nder this

premise than the $act that the a#ency or !nderwriter phase o$ the

relationship o$ )e los Reyes with petitioner was nothin# more than a trial

or probationary period $or his e"ent!al appointment as (ctin# >nit

Mana#er o$ petitioner. hen, a#ain, the "ery desi#nation o$ theappointment o$ pri"ate respondent as actin# !nit mana#er ob"io!sly

implies a temporary employment stat!s which may be made permanent



only !pon compliance with company standard s!ch as those en!merated

!nder Sec. 6 o$ the mana#ement contract.

. /).% /).% /).% /).% P(NM0 O B(0S% -(S0 ( <(R. G On the matter

o$ payment o$ wa#es, petitioner points o!t that respondent was

compensated strictly on commission basis, the amo!nt o$ which was

totally dependent on his total o!tp!t. <!t, the mana#er5s contract speasdi&erently. he abo"e pro"isions !n!estionably demonstrate that the

per$ormance re!irement imposed on )e los Reyes was applicable

!arterly while his entitlement to the $ree portion P993 and the

"alidated portion P1,2993 was monthly startin# on the rst month o$

twel"e 123 months o$ the appointment. h!s, it has to be admitted that

e"en be$ore the end o$ the rst !arter and prior to the so:called

!arterly per$ormance e"al!ation, pri"ate respondent was already

entitled to be paid both the $ree and "alidated portions o$ the >) e"erymonth beca!se his prod!ction per$ormance co!ld not be determined !ntil

a$ter the lapse o$ the !arter in"ol"ed. his indicates !ite clearly that

the !nit mana#er5s !arterly per$ormance had no bearin# at all on his

entitlement at least to the $ree portion o$ the >) which $or all intents and

p!rposes comprised the salary re#!larly paid to him by petitioner. h!s it

cannot be "alidly claimed that the nancial assistance consistin# o$ the

$ree portion o$ the >) was p!rely dependent on the premi!m prod!ction

o$ the a#ent. <e that as it may, it is worth considerin# that the paymento$ compensation by way o$ commission does not militate a#ainst the

concl!sion that pri"ate respondent was an employee o$ petitioner. >nder

(rt. D7 o$ the 'abor -ode, wa#e shall mean howe"er desi#nated,

capable o$ bein# eApressed in terms o$ money, whether Aed or

ascertained on a time, tas, price or commission basis . . . .

4. /).% /).% /).% /).% POB0R O )/SM/SS(' () -ORO'% -(S0 ( <(R.

G ( per!sal o$ the appointment o$ complainant as (ctin# >nit Mana#erre"eals thatF 1. -omplainant was to eAcl!si"ely ser"e respondent

company. h!s it is pro"idedF . . .7..7 Other ca!ses o$ erminationF his

appointment may liewise be terminated $or any o$ the $ollowin#

ca!ses F . . 7..7..2. No!r enterin# the ser"ice o$ the #o"ernment or another

li$e ins!rance company% 7..7... No!r acceptin# a mana#erial or

s!per"isory position in any rm doin# b!siness in the Philippines witho!t

the written consent o$ the -ompany% . . . /t wo!ld not be amiss to state

that respondent5s d!ty to collect the company5s premi!m !sin# companyreceipts !nder Sec. 7.4 o$ the mana#ement contract is $!rther e"idence o$

petitioner5s control o"er respondent. 0Acl!si"ity o$ ser"ice, control o$

assi#nments and remo"al o$ a#ents !nder pri"ate respondent5s !nit,



collection o$ premi!ms, $!rnishin# o$ company $acilities and materials as

well as capital described as >nit )e"elopment !nd are b!t hallmars o$

the mana#ement system in which herein pri"ate respondent wored. his

obtainin#, there is no escapin# the concl!sion that pri"ate respondent

Pantaleon de los Reyes was an employee o$ herein petitioner. a(0)S

) 0 - / S / O

ROM0RO, E pF

On September 28, 1DD1, respondent -apt. Pepito M. !cor was hired by

petitioner Ocean 0ast (#ency -orp. Ocean 0ast3, the mannin# a#ent o$

herein co:petitioner 0!ropean a"i#ation, /nc. 0/3, as master o$ M@

(lpine $or a period o$ one 13 year with a monthly salary o$ >S\849.99.

Sometime in ebr!ary 1DD2, while the M@ (lpine was anchored at the

Port o$ =a"ana, -!ba, respondent was in$ormed o$ his repatriation $or hiss!bse!ent trans$er to another "essel. cdtai

Percei"in# the trans$er as an ins!lt to his pro$essional competence, -apt.

!cor si#nied that, !nless his $!ll benets are accorded him, he shall

re$!se to lea"e the "essel nowin# the ca!se $or his repatriation to be

!nreasonable. /n an e&ort to ass!a#e his $ears, petitioners Ocean 0ast

and 0/ ad"ised him that his ser"ices were not terminated at all, the

repatriation bein# solely $or doc!mentation p!rposes. On ebr!ary 2D,1DD2, a$ter his demands were $!lly settled, respondent a#reed to be

repatriated. Petitioner alle#ed that in "iew o$ respondent5s earlier re$!sal

to be repatriated and to man the newly:ac!ired M =a"re de race, it

was compelled to assi#n another master to the said "essel. herea$ter,

the company decided to assi#n him to M 0leptheria:, whose master

was #oin# on lea"e on ebr!ary 27, which, howe"er, respondent liewise

missed $or $ail!re to disembar when ordered to do so.

On the #ro!nd o$ serio!s miscond!ct or will$!l disobedience, petitionerterminated the ser"ices o$ respondent. /n a complaint $or ille#al dismissal,

on )ecember 1, 1DD, Philippine O"erseas 0mployment (dministration

PO0(3, thro!#h (dministrator elicisimo O. Eoson, dismissed the said

complaint $or lac o$ merit ndin# respondent5s apprehension as

premat!re and that petitioners were merely actin# in the eAercise o$ their

mana#ement prero#ati"e.

On appeal, this decision was re"ersed by the ational 'abor Relations-ommission 'R-3 in its decision dated o"ember 2D, 1DD4, the

dispositi"e portion o$ which readsF



B=0R0OR0, the appealed decision is hereby set aside. he respondents

are hereby directed to +ointly and se"erally pay complainant his salary,

o"ertime pay, "acation lea"e and other benets correspondin# to the

!neApired portion o$ his contract.

SO OR)0R0). 1

/ts motion $or reconsideration ha"in# been denied, petitioners led the

instant petition.

he principal iss!e in this case is whether or not the trans$er cla!se o$ the

Standard 0mployment -ontract S0-3 2 is "iolati"e o$ (rticle 4i3 o$ the

'abor -ode.

Said cla!se pro"ides thatF

he -R0BM0M<0R a#rees to be trans$erred at any port to any "esselowned or operated, manned or mana#ed by the same employer pro"ided

it is accredited to the same mannin# a#ent and pro"ided $!rther that the

ratin# o$ the crewmember and the rate o$ his wa#es and terms o$ ser"ice

are in no way in$erior and the total period o$ employment shall not eAceed

that ori#inally a#reed !pon.

(rticle 4i3 o$ the 'abor -ode, on the other hand, readsF

i3 /t shall be !nlaw$!l $or 5any indi"id!al, entity, licensee or holder o$ a!thority to s!bstit!te or alter employment contract appro"ed and

"eried by the )epartment o$ 'abor $rom the time o$ act!al si#nin#

thereo$ by the parties !p to and incl!din# the periods o$ eApiration o$ the

same witho!t the appro"al o$ the Secretary o$ 'abor.

he 'R-, in settin# aside the decision o$ the PO0(, r!led that the

intended trans$er o$ -apt. !cor to another "essel was in e&ect an

alteration o$ his ori#inal contract which co!ld not be done witho!t theappro"al o$ the Secretary o$ 'abor.

he 'R-5s r!lin# does not pers!ade.

/t m!st be noted that the standard employment contract was adopted

and appro"ed con$ormably with Section , R!le //, <oo o$ the PO0(

R!les and Re#!lations which reads as $ollowsF

Section . Standard 0mployment -ontract. G he (dministration

shall !ndertae de"elopment and@or periodic re"iew o$ re#ion, co!ntry

and sills specic employment contracts $or landbased worers and

cond!ct re#!lar re"iew o$ standard employment contracts S0-3 $or



sea$arers. hese contracts shall pro"ide $or minim!m employment

standards herein en!merated !nder Section 2 o$ this R!le and shall

reco#niCe the pre"ailin# labor and social le#islations at the site o$

employment and international con"entions. he S0- shall set the

minim!m terms and conditions o$ employment. (ll employers and

principals shall adopt the S0- in connection with the hirin# o$ worers

witho!t pre+!dice to their adoption o$ other terms and conditions o$

employment o"er and abo"e the minim!m standards o$ the

(dministration.

On the other hand, el!cidatin# the rationale behind (rticle 4 i3, this

-o!rt held in Sea#!ll Maritime -orp., et al. ". <alaton#an, et al., 4 th!sF

he reason why the law re!ires that the PO0( sho!ld appro"e and

"eri$y a contract !nder (rticle 4i3 o$ the 'abor -ode is to ins!re that the

employee shall not thereby be placed in a disad"anta#eo!s position and

that the same are within the minim!m standards o$ the terms and

conditions o$ s!ch employment contract set by the PO0(. his is why a

standard $ormat $or employment contracts has been adopted by the

)epartment o$ 'abor. 0mphasis s!pplied3

(pparently, there is no inconsistency between (rticle 4i3 o$ the 'abor

-ode and the trans$er cla!se !nder the S0-. On the contrary, the latter

e"en complements the other by way o$ resol"in# the compleA demands o$ sea$arers whose ser"ices may entail occasional trans$er $rom one "essel

to another. Ob"io!sly, the trans$er cla!se is not witho!t limitations. h!s,

a trans$er is sanctioned only i$ it is to any "essel owned or operated,

manned or mana#ed by the same employer pro"ided it is accredited to

the same mannin# a#ent and that the ratin# o$ the crewmember, his

wa#es and terms o$ ser"ice are in no way in$erior and the total period o$

employment shall not eAceed that ori#inally a#reed !pon. /n the instant

case, respondent5s assi#nment to another "essel owned by 0!ropeana"i#ation and accredited to the same mannin# a#ent, there$ore, !nder

no circ!mstance, "iolated (rticle 4i3 o$ the 'abor -ode. he trans$er

cla!se is deemed incorporated into the ori#inal contract% hence, the

appro"al o$ the Secretary o$ 'abor is no lon#er necessary.

(ccordin#ly, we concl!de that petitioners merely a"ailed o$ what the

employment contract allows. /ndeed, it was nothin# more than an

application o$ the s!b+ect pro"ision.

Bith re#ard to the ndin# o$ ille#al dismissal, the pertinent pro"ision o$

the 'abor -ode statesF



(rt. 282. ermination by employer. G dctai

(n employer may terminate an employment $or any o$ the $ollowin#

ca!sesF

a. Serio!s miscond!ct or wil$!l disobedience by the employer o$ the

law$!l orders o$ his employer or representati"e in connection with his

wor%

AAA AAA AAA.

/n (=S Philippines, /nc. ". -o!rt o$ (ppeals, ; we held that in order that an

employer may terminate an employee on the #ro!nd o$ will$!l

disobedience to the $ormer5s order, re#!lations or instr!ctions, it m!st be

established that the said orders, re#!lation or instr!ctions are a3

reasonable and law$!l, b3 s!*ciently nown to the employee, and c3 inconnection with the d!ties which the employee has been en#a#ed to

dischar#e.

/n the instant case, petitioners ha"e conscientio!sly apprised respondent

that his repatriation was solely $or doc!mentation p!rposes preliminary to

his trans$er to another "essel which the mana#ement belie"es him to be

more $amiliar with. Respondent5s deance o$ a law$!l order posed serio!s

and considerable pre+!dice to the b!siness o$ the employer. his -o!rt

nds that petitioner5s order was made within the sphere o$ itsmana#ement prero#ati"e. he eAercise o$ an employer to re#!late all

aspects o$ employment m!st be in eepin# with #ood $aith and not be

!sed as a preteAt $or de$eatin# the ri#hts o$ employees !nder the laws

and applicable contracts. 6 ( per!sal o$ the records shows a clear, "alid

and le#al ca!se $or the termination o$ respondent5s employment. (s

correctly "iewed by the Solicitor eneralF

-apt. !cor5s re$!sal to disembar and t!rn o"er command o$ his "esselto its new master when instr!cted to do so ca!sed #reat pec!niary

dama#e to his employer. he "essel was at anchora#e $or a lon# time

disr!ptin# its sched!le. ot only that. =e was not able to tae command

o$ the M@ =a"re de race, $orcin# 0!ropean a"i#ation to mae the

arran#ements and assi#n a new master to it. 0!ropean a"i#ation,

eAercisin# maAim!m tolerance in spite o$ -apt. !cor5s ins!bordination,

e"en went as $ar as assi#nin# him to the M@ 0leptheria: a$ter he missed

the M@ =a"re de race. =e liewise missed this assi#nment. (ll thisbeca!se he belie"ed that his trans$er was an ins!lt to his personal and

pro$essional capacity.



-apt. !cor will$!lly disobeyed a law$!l order o$ his employer. his act o$

ins!bordination is a "alid #ro!nd $or dismissal. 7

B=0R0OR0, the instant petition is hereby R(0). he decision o$ the

ational 'abor Relations -ommission dated o"ember 2D, 1DD4 is

"acated and the resol!tion o$ the PO0( (dministrator is R0/S(0). o

costs.

SO OR)0R0). dctai

ar"asa, - .E ., ap!nan and P!risima, EE ., conc!r.



S0-O) )//S/O

J.R. o. 19D898. March 1, 1DD;.K

0S('N -=(0Z, petitioner, "s. =O. 0)( <OO:P0R0Z, =O.

RO0'/O . R(N('(, =O. )OM/O =. Z(P((, =O. EOS0 .

S(RM/0O, -0R>M PROMO/OS ? P'(-0M0 -ORPOR(/O, EOS0

(. (Z>-0(, ER., and /M0S S>R0N ? /S>R(-0 -OMP(N, /-.,

respondents.

eliA - . -ha"eC $or petitioner.

he Solicitor eneral $or respondents.

SN''(<>S

1. '(<OR () SO-/(' '0/S'(/O% B(0S% S/)0 (R00M0 OR0)>-0 B(0S% >''//0) / -(S0 ( <(R. G he mana#erial

commission a#reement eAec!ted by petitioner to a!thoriCe her Eapanese

employer to ded!ct wo =!ndred i$ty >.S. )ollars >S\2;9.993 $rom her

monthly basic salary is "oid beca!se it is a#ainst o!r eAistin# laws, morals

and p!blic policy. /t cannot s!persede the standard employment contract

o$ )ecember 1, 1D88 appro"ed by the PO0(. he basic salary o$ One

ho!sand i"e =!ndred >.S. )ollars >S\1,;99.993 #!aranteed to

petitioner !nder the parties5 standard employment contract is inaccordance with the minim!m employment standards, with respect to

wa#es set by the PO0(. h!s, the side a#reement which red!ced

petitioner5s basic wa#e to Se"en =!ndred i$ty >.S. )ollars >.S.\7;9.993

is n!ll and "oid $or "iolatin# the PO0(5s minim!m employment standards,

and $or not ha"in# been appro"ed by the PO0(. /ndeed, this side

a#reement is a scheme all too $re!ently resorted to by !nscr!p!lo!s

employers a#ainst o!r helpless o"erseas worers who are compelled to

a#ree to satis$y their basic economic needs.

2. /).% /).% (0-N () OR0/ PR/-/P('% SO'/)(R/'N '/(<'0 OR

>P(/) B(0S. G Pri"ate respondents -entr!m and imes as well as

Plannin# Eapan -o., 'td. G the a#ency5s $orei#n principal G are solidarily

liable to petitioner $or her !npaid wa#es. his is in accordance with

stip!lation 1.7 o$ the parties5 standard employment contract. his

solidary liability also arises $rom the pro"isions o$ Section 19a323, R!le ,

<oo / o$ the Omnib!s R!les /mplementin# the 'abor -ode.

. /).% )O-R/0 O '(-=0S% )0/0)% B=0 O (PP'/-(<'0% -(S0

( <(R. G he doctrine o$ laches or stale demands cannot be applied to

petitioner. 'aches has been dened as the $ail!re or ne#lect $or an



!nreasonable and !neAplained len#th o$ time to do that which, by

eAercisin# d!e dili#ence, co!ld or sho!ld ha"e been done earlier, 'a

-ampana ood Prod!cts, /nc. ". -o!rt o$ (ppeals, 22 S-R( 1;1 J1DDK,

Radio -omm!nications o$ the Philippines, /nc. ". ational 'abor Relations

-ommission, 22 S-R( 6;6 J1DDK% Marcelino ". -o!rt o$ (ppeals, 219

S-R( 444 J1DD2K3 th!s #i"in# rise to a pres!mption that the party entitled

to assert it either has abandoned or declined to assert it. <er#ado ".

-o!rt o$ (ppeals, 17 S-R( 4D7 J1D8DK3. /t is not concerned with mere

lapse o$ time% the $act o$ delay, standin# alone, is ins!*cient to constit!te

laches. )onato ". -o!rt o$ (ppeals, 217 S-R( 1D6 J1DDK3. he doctrine

o$ laches is based !pon #ro!nds o$ p!blic policy which re!ires, $or the

peace o$ society, the disco!ra#ement o$ stale claims, and is principally a

!estion o$ the ine!ity or !n$airness permittin# a ri#ht or claim to be

en$orced or asserted. <er#ado ". -o!rt o$ (ppeals, op. cit.3 here is no

absol!te r!le as to what constit!tes laches% each case is to be determined

accordin# to its partic!lar circ!mstances. he !estion o$ laches is

addressed to the so!nd discretion o$ the co!rt, and since it is an e!itable

doctrine, its application is controlled by e!itable considerations. /t

cannot be wored to de$eat +!stice or to perpetrate $ra!d and in+!stice.

EimeneC ". ernandeC, 184 S-R( 1D9 J1DD9K3.

) 0 - / S / O

P>O, E pF

One o$ the an#!ished cries in o!r society today is that while o!r laws

appear to protect the poor, their interpretation is sometimes anti:poor. /n

the case at bench, petitioner, a poor, !nco!nselled entertainment dancer

si#ned a contract with her Eapanese employer callin# $or a monthly salary

o$ One ho!sand i"e =!ndred >.S. )ollars >S\1,;993, b!t later had to

si#n an immoral side a#reement red!cin# her salary below the minim!m

standard set by the PO0(. Petitioner in"oed the law to collect her salarydi&erentials, b!t incredibly $o!nd p!blic respondents strainin# the seams

o$ o!r law to dis$a"or her. here is no #reater disappointment to the poor

lie petitioner than to disco"er the !#ly reality behind the bea!ti$!l

rhetoric o$ laws. Be will not allow this tra"esty.

his is a petition $or certiorari to re"iew the )ecision o$ the ational 'abor

Relations -ommission 'R-3, 1 dated )ecember 2D, 1DD2, which

a*rmed the )ecision o$ p!blic respondent Philippine O"erseas0mployment (#ency PO0(3 (dministrator Eose . Sarmiento, dated

ebr!ary 17, 1DD2, dismissin# petitioner5s complaint $or !npaid salaries

amo!ntin# to SiA ho!sand >.S. )ollars >S\6,999.993. 'ib'eA



he $acts are !ndisp!ted.

On )ecember 1, 1D88, petitioner, an entertainment dancer, entered into

a standard employment contract $or o"erseas ilipino artists and

entertainers with Plannin# Eapan -o., 'td., 2 thro!#h its Philippine

representati"e, pri"ate respondent -entr!m Placement ? Promotions

-orporation. he contract had a d!ration o$ two 23 to siA 63 months, andpetitioner was to be paid a monthly compensation o$ One ho!sand i"e

=!ndred >.S. )ollars >S\1,;99.993. On )ecember ;, 1D88, the PO0(

appro"ed the contract. S!bse!ently, petitioner eAec!ted the $ollowin#

side a#reement with her Eapanese employer thro!#h her local mana#er,

EaC alents PromotionF

)ateF )ec. 19, 1D88

S><E0-F Salary )ed!ction

M((0R/(' -OMM/SS/O

)(0 O )0P(R>R0F ]]]]]]]]]]]]]

(0/OF MR. /B((

/, 0S('N -=(0Z, )(-0R, do hereby with my own $ree will and

"ol!ntarily ha"e the honor to a!thoriCe yo!r #ood o*ce to please ded!ct

the amo!nt o$ BO =>)R0) /N )O''(RS \2;93 $rom my contractedmonthly salary o$ S00 =>)R0) /N )O''(RS \7;93 as monthly

commission $or my Mana#er, Mr. Eose (. (C!cena, Er.

hat my monthly salary net3 is /0 =>)R0) )O''(RS \;993.

s#d. by petitioner3

On )ecember 16, 1D88, petitioner le$t $or Osaa, Eapan, where she

wored $or siA 63 months, !ntil E!ne 19, 1D8D. She came bac to thePhilippines on E!ne 14, 1D8D. prcd

Petitioner instit!ted the case at bench $or !nderpayment o$ wa#es with

the PO0( on ebr!ary 21, 1DD1. She prayed $or the payment o$ SiA

ho!sand >.S. )ollars >S\6,999.993, representin# the !npaid portion o$

her basic salary $or siA months. -har#ed in the case were pri"ate

respondent -entr!m Promotions and Placement -orporation, the

Philippine representati"e o$ Plannin# Eapan, -o., /nc., its ins!rer, imes

S!rety and /ns!rance -o., /nc., and EaC alents Promotion. -dpr



he complaint was dismissed by p!blic respondent PO0( (dministrator on

ebr!ary 17, 1DD2. =e ratiocinated, inter aliaF

. . . (pparently and $orm all indications, complainant re$errin# to

petitioner herein3 was satised and did not ha"e any complaint abo!t3

anythin# re#ardin# her employment in Eapan !ntil a$ter almost two 23

years when3 she led the instant complaint on ebr!ary 21, 1DD1. herecords show that a$ter si#nin# the Standard 0mployment -ontract on

)ecember 1, 1D88, she entered into a side a#reement with the Eapanese

employer thr! her local mana#er, EaC alents Promotion consentin# to a

monthly salary o$ >S\7;9.99 which she a*rmed d!rin# the con$erence o$

May 21, 1DD1. Respondent a#ency had no nowled#e nor participation in

the said a#reement s!ch that it co!ld not be $a!lted $or "iolation o$ the

Standard 0mployment -ontract re#ardin# the stip!lated salary. Be cannot

tae co#niCance o$ s!ch "iolation when one o$ the principal party sic3thereto opted to recei"e a salary di&erent $rom what has been stip!lated

in their contract, especially so i$ the other contractin# party did not

consent@participate in s!ch arran#ement. -omplainant petitioner3 cannot

now demand $rom respondent a#ency to pay her the salary based on3

the processed 0mployment -ontract $or she is now considered in bad

$aith and hence, estopped $rom claimin# thereto thr! her own act o$

consentin# and a#reein# to recei"e a salary not in accordance with her

contract o$ employment. Moreo"er, her sel$:imposed silence $or a lon#period o$ time wored to her own disad"anta#e as she allowed laches to

pre"ail which barred respondent $rom doin# somethin# at the o!tset.

ormally, i$ a person5s ri#ht is3 "iolated, she@he wo!ld immediately react

to protect her@his ri#hts which is not tr!e in the case at bar.

he term laches has been dened as one5s ne#li#ence or $ail!re to assert

his ri#ht in d!e time or within reasonable time $rom the accr!al o$ his

ca!se o$ action, th!s, leadin# another party to belie"e that there isnothin# wron# with his own claim. his res!lted in placin# the ne#li#ent

party in estoppel to assert or en$orce his ri#ht. . . . 'iewise, the S!preme

-o!rt in one case held that not only is inaction within reasonable time to

en$orce a ri#ht the basic premise that !nderlies a "alid de$ense o$ laches

b!t s!ch inaction e"inces implied consent or ac!iescence to the

"iolation o$ the ri#ht. . . .

>nder the pre"ailin# circ!mstances o$ this case, it is o!tside the

re#!latory powers o$ the (dministration to r!le on the liability o$ respondent EaC alents Promotions, i$ any, it3 not bein# a licensed pri"ate

a#ency b!t a promotion which trains entertainers $or abroad. cdphil



AAA AAA AAA -itations omitted.3

On appeal, the 'R- !pheld the )ecision, th!sF

Be $ail to see any conspiracy that the complainant petitioner herein3

imp!tes to the respondents. She has, to p!t it bl!ntly, not established

and@or laid the basis $or >s to arri"e at a concl!sion that the respondents

ha"e been and sho!ld be held liable $or her claims.

he way Be see it, the records do not at all indicate any connection

between respondents -entr!m Promotion ? Placement -orporation and

EaC alents Promotion. -dpr

here is, there$ore, no merit in the appeal. =ence, Be a*rmed. 4

)issatised with the 'R-5s )ecision, petitioner instit!ted the present

petition, alle#in# that p!blic respondents committed #ra"e ab!se o$ discretion in ndin#F that she is #!ilty o$ laches% that she entered into a

side contract on )ecember 19, 1D88 $or the red!ction o$ her basic salary

to Se"en =!ndred i$ty >.S. )ollars >S\7;9.993 which s!perseded,

n!llied and in"alidated the standard employment contract she entered

into on )ecember 1, 1D88% and that Plannin# Eapan -o., 'td. and pri"ate

respondents are not solidarily liable to her $or SiA ho!sand >S )ollars

>S\6,999.993 in !npaid wa#es. ;

he petition is meritorio!s.

irstly, we hold that the mana#erial commission a#reement eAec!ted by

petitioner to a!thoriCe her Eapanese employer to ded!ct wo =!ndred

i$ty >.S. )ollars >S\2;9.993 $rom her monthly basic salary is "oid

beca!se it is a#ainst o!r eAistin# laws, morals and p!blic policy. /t cannot

s!persede the standard employment contract o$ )ecember 1, 1D88

appro"ed by the PO0( with the $ollowin# stip!lation appended theretoF

/t is !nderstood that the terms and conditions stated in this 0mployment

-ontract are in con$ormance with the Standard 0mployment -ontract $or

0ntertainers prescribed by the PO0( !nder Memorand!m -irc!lar o. 2,

Series o$ 1D86. (ny alterations or chan#es made in any part o$ this

contract witho!t prior appro"al by the PO0( shall be n!ll and "oid% 6

0mphasis s!pplied.3

he stip!lation is in line with the pro"isions o$ R!le //, <oo and Section

2$3, R!le /, <oo / o$ the 1DD1 R!les and Re#!lations o"ernin#

O"erseas 0mployment, th!sF



<oo , R!le //

Section 1. 0mployment Standards. G he (dministration shall

determine, $orm!late and re"iew employment standards in accordance

with the maret de"elopment and wel$are ob+ecti"es o$ the o"erseas

employment pro#ram and the pre"ailin# maret conditions.

Section 2. Minim!m Pro"isions $or -ontract. G he $ollowin# shall be

considered the minim!m re!irements $or contracts o$ employmentF

a. !aranteed wa#es $or re#!lar worin# ho!rs and o"ertime pay $or

ser"ices rendered beyond re#!lar worin# ho!rs in accordance with the

standards established by the (dministration%

AAA AAA AAA

Section . Standard 0mployment -ontract. G he (dministrationshall !ndertae de"elopment and@or periodic re"iew o$ re#ion, co!ntry

and sills specic employment contracts $or landbased worers and

cond!ct re#!lar re"iew o$ standard employment contracts S0-3 $or

sea$arers. hese contracts shall pro"ide $or minim!m employment

standards herein en!merated !nder Section 2, o$ this R!le and shall

reco#niCe the pre"ailin# labor and social le#islations at the site o$

employment and international con"entions. he S0- shall set the

minim!m terms and conditions o$ employment. (ll employers andprincipals shall adopt the S0- in connection with the hirin# o$ worers

witho!t pre+!dice to their adoption o$ other terms and conditions o$

employment o"er and abo"e the minim!m standards o$ the

(dministration. 0mphasis s!pplied.3 'eA'ib

and

<OO /, R>'0 /

Section 2. ro!nds $or s!spension@cancellation o$ license.

AAA AAA AAA

$. S!bstit!tin# or alterin# employment contracts and other doc!ments

appro"ed and "eried by the (dministration $rom the time o$ act!al

si#nin# thereo$ by the parties !p to and incl!din# the period o$ eApiration

o$ the same witho!t the (dministration5s appro"al.

AAA AAA AAA

0mphasis s!pplied3



-learly, the basic salary o$ One ho!sand i"e =!ndred >.S. )ollars

>S\1,;99.993 #!aranteed to petitioner !nder the parties5 standard

employment contract is in accordance with the minim!m employment

standards with respect to wa#es set by the PO0(. h!s, the side

a#reement which red!ced petitioner5s basic wa#e to Se"en =!ndred i$ty

>.S. )ollars >S\7;9.993 is n!ll and "oid $or "iolatin# the PO0(5s

minim!m employment standards, and $or not ha"in# been appro"ed by

the PO0(. /ndeed, this side a#reement is a scheme all too $re!ently

resorted to by !nscr!p!lo!s employers a#ainst o!r helpless o"erseas

worers who are compelled to a#ree to satis$y their basic economic

needs. cdll

Secondly. he doctrine o$ laches or stale demands cannot be applied to

petitioner. 'aches has been dened as the $ail!re or ne#lect $or an

!nreasonable and !neAplained len#th o$ time to do that which, byeAercisin# d!e dili#ence, co!ld or sho!ld ha"e been done earlier, 7 th!s

#i"in# rise to a pres!mption that the party entitled to assert it either has

abandoned or declined to assert it. 8 /t is not concerned with mere lapse

o$ time% the $act o$ delay, standin# alone, is ins!*cient to constit!te

laches. D

he doctrine o$ laches is based !pon #ro!nds o$ p!blic policy which

re!ires, $or the peace o$ society, the disco!ra#ement o$ stale claims, andis principally a !estion o$ the ine!ity or !n$airness o$ permittin# a ri#ht

or claim to be en$orced or asserted. 19 here is no absol!te r!le as to

what constit!tes laches% each case is to be determined accordin# to its

partic!lar circ!mstances. he !estion o$ laches is addressed to the

so!nd discretion o$ the co!rt, and since it is an e!itable doctrine, its

application is controlled by e!itable considerations. /t cannot be wored

to de$eat +!stice or to perpetrate $ra!d and in+!stice. 11

/n the case at bench, petitioner led her claim well within the three:yearprescripti"e period $or the lin# o$ money claims set $orth in (rticle 2D1 o$

the 'abor -ode. 12 or this reason, we hold the doctrine o$ laches

inapplicable to petitioner. (s we r!led in /mperial ictory Shippin# (#ency

". 'R- , 299 S-R( 178 1DD13F

. . . 'aches is a doctrine in e!ity while prescription is based on law. O!r

co!rts are basically co!rts o$ law not co!rts o$ e!ity. h!s, laches cannot

be in"oed to resist the en$orcement o$ an eAistin# le#al ri#ht. Be ha"er!led in (rsenal ". /ntermediate (ppellate -o!rt . . . that it is a lon#

standin# principle that e!ity $ollows the law. -o!rts eAercisin# e!ity

+!risdiction are bo!nd by r!les o$ law and ha"e no arbitrary discretion to



disre#ard them. /n Zabat, Er. ". -o!rt o$ (ppeals . . ., this -o!rt was more

emphatic in !pholdin# the r!les o$ proced!re. Be said thereinF

(s $or e!ity, which has been aptly described as a 5+!stice o!tside

le#ality,5 this is applied only in the absence o$, and ne"er a#ainst,

stat!tory law or, as in this case, +!dicial r!les o$ proced!re. (e!etas

n!n!am contra"enit le#is. he pertinent positi"e r!les bein# presenthere, they sho!ld preempt and pre"ail o"er all abstract ar#!ments based

only on e!ity.

h!s, where the claim was led within the three:year stat!tory period,

reco"ery there$ore cannot be barred by laches. -o!rts sho!ld ne"er apply

the doctrine o$ laches earlier than the eApiration o$ time limited $or the

commencement o$ actions at law. 'eA'ib

AAA AAA AAA

0mphasis s!pplied. -itations omitted.3

hirdly, pri"ate respondents -entr!m and imes as well as Plannin# Eapan

-o., 'td. G the a#ency5s $orei#n principal G are solidarily liable to

petitioner $or her !npaid wa#es. his is in accordance with stip!lation

1.7 o$ the parties5 standard employment contract which pro"idesF

1.7. he 0mployer in this case, Plannin# Eapan -o., 'td.3 and itslocally sic3 a#ent@promoter@representati"e pri"ate respondent -entr!m

Promotions ? Placement -orporation3 shall be +ointly and se"erally

responsible $or the proper implementation o$ the terms and conditions in

this -ontract. 1 0mphasis s!pplied.3

his solidary liability also arises $rom the pro"isions o$ Section 19a323,

R!le , <oo / o$ the Omnib!s R!les /mplementin# the 'abor -ode, as

amended, th!sF

Section 19. Re!irement be$ore recr!itment. G <e$ore recr!itin# any

worer, the pri"ate employment a#ency shall s!bmit to the <!rea! the

$ollowin# doc!mentsF

a3 ( $ormal appointment or a#ency contract eAec!ted by a $orei#n:

based employer in $a"or o$ the license holder to recr!it and hire personnel

$or the $ormer. . . . S!ch $ormal appointment or recr!itment a#reement

shall contain the $ollowin# pro"isions, amon# otherF

AAA AAA AAA



2. Power o$ the a#ency to s!e and be s!ed +ointly and solidarily with

the principal or $orei#n based employer $or any o$ the "iolations o$ the

recr!itment a#reement and the contracts o$ employment. 'eA'ib

AAA AAA AAA

0mphasis s!pplied.3

O!r o"erseas worers constit!te an eAploited class. Most o$ them come

$rom the poorest sector o$ o!r society. hey are thoro!#hly

disad"anta#ed. heir prole shows they li"e in s!&ocatin# sl!ms, trapped

in an en"ironment o$ crime. =ardly literate and in ill health, their only

hope lies in +obs they can hardly nd in o!r co!ntry. heir !n$ort!nate

circ!mstance maes them easy prey to a "aricio!s employers. hey will

climb mo!ntains, cross the seas, end!re sla"e treatment in $orei#n lands

+!st to s!r"i"e. O!t o$ despondence, they will wor !nder s!b:h!manconditions and accept salaries below the minim!m. he least we can do is

to protect them with o!r laws in o!r land. Re#ret$!lly, respondent p!blic

o*cials who sho!ld sympathiCe with the worin# class appear to ha"e a

di&erent orientation.

/ /0B B=0R0O, the petition is R(0). he )ecisions o$ respondent

PO0( (dministrator and 'R- -ommissioners in PO0( -ase o. (d+. D1:

92:1DD 0R3, respecti"ely dated ebr!ary 17 and )ecember 2D, 1DD2, andthe Resol!tion o$ the 'R-, dated March 2, 1DD, are R00RS0) and

S0 (S/)0. Pri"ate respondents are held +ointly and se"erally liable to

petitioner $or the payment o$ S/Q =O>S() >S )O''(RS >S\6,999.993

in !npaid wa#es. -osts a#ainst pri"ate respondents. 'ib'eA

SO OR)0R0).

ar"asa, -.E., <idin, Re#alado and MendoCa, EE., conc!r.

Labor Cases 12 - Digest.docx

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