Binalla was a victim of contract substitution.
He worked under an employment
8. PRINCESS JOY PLACEMENT AND GENERAL SERVICES INC VS.
BINALLA
FACTS:
This court resolves the motion for reconsideration of the Courts
Resolution dated August 8, 2011 denying the petition for review
on certiorari filed by Princess Joy Placement and General Services, Inc., for
failure to sufficiently show any reversible error in the decision.
German Binalla, a registered nurse, alleged that, he applied for employment
with Princess Joy who referred him to Reginaldo Paguio and Cynthia Latea for
processing of his papers. After completing his documentary requirements, he
was told that he would be deployed to Al Adwani. He signed a four-year
contract with Al Adwani as staff nurse. He paid, although no receipts were
issued to him. Later, he was given a telegram notifying him of his departure.
Binalla further alleged it was only after boarding his Saudi Arabia Airlines plane
that he examined his papers and discovered that CBM was his deploying
agency. He also saw that under the four-year contract he signed, his monthly
salary was only 1,500 Saudi Riyals (SR) equivalent to $400. Left with no
choice as he was then already bound for Saudi Arabia, he worked under his
contract for only two years and returned to the Philippines after posting a bond,
supposedly to guarantee that he would come back to finish his contract.
Upon his return to the Philippines, Binalla verified his employment contract
with the POEA. He learned that the POEA indeed certified a different contract
for him, with CBM as his recruiting or deploying agency. He disowned the
contract, claiming that his supposed signature appearing in the document was
a forgery. Out of frustration, he opted not to return to Saudi Arabia to complete
his four-year contract.
Binalla argued before the labor arbiter that he was re-processed an
arrangement where Princess Joy recruited and deployed him, but made it
appear that it was undertaken by CBM under a different contract submitted to
and certified by the POEA. He complained that he was made to work under
an inferior contract and that Al Adwani itself violated the terms of his four-year
contract.
Binalla filed a complaint against local manning agent CBM Business
Management and Manpower Services and/or Princess Joy/Al Adwani General
Hospital for various money claims arising from his employment with Al
Adwani, in Taif, Saudi Arabia.
Labor Arbiter Aurellano found merit in the complaint. He found credible
Binallas contention that Paguio and Lateo, who processed his papers, were
working for Princess Joy, taking special note of the ticket/telegram/advise
handed by Paguio to Binalla and declared CBM and Princess Joy jointly and
severally liable to pay Binalla.
NLRC ruled that the facts and evidence of the case do not establish
reprocessing as the means for Binallas deployment to Saudi Arabia. It
declared that, on the contrary, substantial evidence existed pointing to CBMs
sole liability as the recruiting and deploying agent of Binalla. It refused to give
credit to the ticket telegram/advice Binalla submitted in evidence to establish
Princess Joys liability as it was merely an unsigned and unauthenticated
printout with no indication of its source, purpose, or the entity to whom it is
addressed.
CA granted the petition and set aside the NLRC rulings. Princess Joy moved
for reconsideration, but the CA denied the motion; thus the petition.
ISSUE/S:
W/N Princess Joy liable under the complaint.
HELD:
Yes. Binalla was employed by Al Adwani in Saudi Arabia through a fraudulent
scheme or arrangement, called reprocessing or otherwise, participated in by
Princess Joy and CBM, as well as by Paguio and Lateo. Although the scheme
enabled Binalla to be employed overseas, his two-year employment was
marred from the start by violations of the law on overseas employment.
contract whose terms were inferior to the terms certified by the POEA. Under
the four-year contract he signed and implemented by his employer, Al Adwani,
he was paid only SR1500.00 or US$400 a month; whereas, under the POEA-
certified two-year contract, he was to be paid $550.00.
Under Article 34 (i) of the Labor Code on prohibited practices, it shall be
unlawful for any individual, entity, licensee, or holder of authority to substitute
or alter employment contracts approved and verified by the Department of
Labor and Employment from the time of actual signing thereof by the parties
up to and including the periods of expiration of the same without the approval
of the Secretary of Labor. Further, contract substitution constitutes illegal
recruitment under Article 38 (I) of the Code.
Under the circumstances, Princess Joy is as liable as CBM and Al Adwani for
the contract substitution, no matter how it tries to avoid liability by disclaiming
any participation in the recruitment and deployment of Binalla to Al
Adwani. Before the labor arbiter, Princess Joy claimed that Paguio and Lateo
were not its employees/representatives or that the principal piece of evidence
relied upon by the labor arbiter, the ticket/telegram/advise handed to Binalla
by Paguio had no probative value as it was merely an unsigned and
unauthenticated printout or that the four-year employment contract was signed
only by Binalla and there was no showing that it was the contract implemented
by Al Adwani. Princess Joys protestations fail to convince us. We believe, as
the labor arbiter did, that the ticket telegram/advice is proof enough that
Princess Joy recruited Binalla. In the instant case, however, it was fortunate
that the complainant was able to hold onto the ticket telegram/advise handed
to him by Reginaldo Paguio. Clearly shown thereat, it carried the names
PRINCESS JOY and REGIE. It would not be an unreasonable
presumption that indeed Princess Joy recruited complainant and that the latter
had been transacting with Reginaldo Paguio.
9. CATAN VS. NLRC
FACTS:
This is a special civil action for certiorari. The petitioner alleges grave abuse
of discretion on the part of the NLRC in an effort to nullify the latters resolution
and thus free petitioner from liability for the disability suffered by a Filipino
worker it recruited to work in Saudi Arabia.
Petitioner, a duly licensed recruitment agency, as agent of Ali and Fahd
Shabokshi Group, a Saudi Arabian firm, recruited private respondent to work
in Saudi Arabia as a steelman. The term of the contract was for one year,
however, the contract provided for its automatic renewal. The contract was
automatically renewed when private respondent was not repatriated by his
Saudi employer but instead was assigned to work as a crusher plant operator.
While he was working as a crusher plant operator, private respondent's right
ankle was crushed under the machine he was operating. After the expiration
of the renewed term, private respondent returned to the Philippines. His ankle
was operated for which he incurred expenses.
He returned to Saudi Arabia to resume his work, then he was repatriated. Upon
his return, he had his ankle treated for which he incurred further expenses.
Private respondent filed a claim with the POEA, on the basis of the provision
in the employment contract that the employer shall compensate the employee
if he is injured or permanently disabled in the course of employment. POEA
rendered judgment in favor of private respondent. NLRC affirmed the decision.
Not satisfied with the resolution of the POEA, petitioner instituted the instant
special civil action for certiorari, alleging grave abuse of discretion on the part
of the NLRC.
ISSUE/S:
a. W/N NLRC gravely abused its discretion when it ruled that petitioner was
liable to private respondent for disability benefits since at the time he was
injured his original employment contract, which petitioner facilitated, had
already expired.
b. W/N the petitioner can disclaim liability on the ground that its agency
agreement with the Saudi principal had already expired when the injury was
sustained.
HELD:
a. No. Private respondents contract of employment cannot be said to have
expired as it was automatically renewed since no notice of its termination was
given by either or both of the parties at least a month before its expiration, as
so provided in the contract itself. Therefore, private respondent's injury was
sustained during the lifetime of the contract.
b. No. A private employment agency may be sued jointly and solidarily with its
foreign principal for violations of the recruitment agreement and the contracts
of employment. Under Section 10(a) (2) Rule V, Book I, Power of the agency
to sue and be sued jointly and solidarily with the principal or foreign-based
employer for any of the violations of the recruitment agreement and the
contracts of employment.
Even if indeed petitioner and the Saudi principal had already severed their
agency agreement at the time private respondent was injured, petitioner may
still be sued for a violation of the employment contract because no notice of
the agency agreement's termination was given to the private respondent.
Under Art 1921 of the CC If the agency has been entrusted for the purpose
of contra with specified persons, its revocation shall not prejudice the latter if
they were not given notice thereof.
10. PP VS. CORAL
FACTS:
This is a review of accused-appellant's conviction of crimes of Illegal
Recruitment and Estafa.
The Information in Criminal Case NO. 90-82870 for Illegal Recruitment reads
as follows: The undersigned accuses ELIZABETH CORAL y ADELAN alias
"Beth" of violation of Art. 38 (1), Pres. Decree No. 1412, amending certain
provisions of Book 1, Pres. Decree No. 442 otherwise known as the New Labor
Code of the Philippines, in relation to Art. 13 (b) and (c) of said Code as further
amended by Pres. Decree Nos. 1693, 1920 and 2108, committed in large
scale, as follows: That on or about December 27, 1989, in the City of Manila,
Philippines, the said accused, representing herself to have the capacity to
contract, enlist and transport Filipino workers for employment abroad, did then
and there willfully and unlawfully, for a fee, recruit and promise
employment/job placement abroad to the following persons, to wit: BELLA
BUSTRIA y RIVERA, GLENDA ELEFANTE y RIVERA, JOSSIE CAYAGA Y
FABRIGAS, REMEDIOS CASIANO y CASACLANG, and MILLIARINA
ROMALDO y ANTONIO, without first having secured the necessary license or
authority from the Department of Labor. Contrary to law.
Upon arraignment, accused-appellant pleaded not guilty to the offenses
charged. The cases were tried jointly.
The prosecution presented as principal witnesses, four (4) of the five (5)
private complainants, namely: Glenda Elefante, Bella Bustria, Jossie Cayaga,
and Remedios Casiano. All four witnesses identified accused-appellant as the
person who perpetrated the crimes of Illegal Recruitment and Estafa against
them.
The first of the prosecution witnesses to testify was 30-year-old high school
graduate and housewife GLENDA ELEFANTE y RIVERA, a native of San
Marcelino, Zambales. According to her, she met the spouses Nora and
Bartolome Rubias through a mutual friend. During their second meeting, Nora
Rubias told Glenda that she (Nora) had already talked to accused-appellant,
and that if Glenda wanted to apply for work abroad, they could go to accused-
appellant's office in Manila. Glenda was brought by the Rubias spouses to
accused-appellant's office. There, Glenda and accused-appellant discussed
the former's application as a factory worker in Taiwan which purportedly paid
between $500 and $700 monthly. Accused-appellant asked Glenda to give an
advance payment of P10,000.00 for the processing of her Taiwanese visa,
and P1,500.00 for the preparation of her passport. Glenda went home to
Zambales to borrow the money. She gave it personally to accused-
appellant. Accused-appellant did not issue her any receipt. She was then told
to wait a couple of weeks. When she returned to the office of accused-
appellant, her visa was still unavailable allegedly because of the strictness of
the Taiwanese Embassy.
Some days later, Glenda visited accused-appellant in her office. She was
offered by accused-appellant a job as a factory worker in South Korea. Glenda
was required by accused-appellant to pay an additional P15,000.00 as
placement fee. Glenda together with two of her co-complainants, Bella Bustria
and Jossie Cayaga, went to accused-appellant's office in Ermita. Bella and
Jossie paid to accused-appellant the amount of P25,000.00 each. The three
were issued one receipt by a certain Jimmy Magno, allegedly a secretary of
the accused-appellant. The receipt was placed in the name of Glenda and
covered the amount of P60,000.00. It was for the payment of Glenda's
P10,000.00 and the P25,000.00 payment each of Bella and Jossie.
Glenda was able to pay to accused-appellant the P15,000.00 additional
placement fee for her job application in South Korea. No receipt was issued to
her by accused-appellant. Accused-appellant then promised Glenda she
could leave for South Korea. This promise was broken, however, because on
that date, Glenda was informed that accused-appellant was in Korea. Even
after accused-appellant returned, Glenda was not able to fly to Korea,
purportedly because of the Chinese New Year celebration.
While waiting for her time to leave, Glenda met her co-complainant Remedios
Casiano, who arrived from Korea. Remedios narrated to Glenda and the other
complainants how she almost died in Korea, and how accused-appellant took
her salary for one month. Fearing the same fate, Glenda demanded from
accused-appellant the return of her money. Accused-appellant
refused. Glenda then went to the POEA to check if accused-appellant was a
duly licensed recruiter. She found out that accused-appellant had no authority
to recruit workers for jobs abroad. Gllenda went to the police station to file her
complaint.
On cross-examination, Glenda denied she owed accused-appellant the
amount of P13,000.00, but admitted having received the amount of P500.00
from a female secretary of accused-appellant.
Upon the other hand, the defense of accused-appellant rests mainly on denial
and alibi. She alleged that she is not a recruiter, but an importer/exporter and
an authorized travel agent. She explained that the charges against her were
due to the ill-will of private complainants. On the other hand, complainants
Cayaga and Bustria got angry as she did not employ them as househelpers.
Accused-appellant denied that she had a male secretary, or any employee by
the name of Jimmy Magno, whose signature appeared in the receipt for
P60,000.00.
On the basis of the evidence adduced, the trial court convicted accused-
appellant of Illegal Recruitment and four (4) counts of Estafa.
ISSUE/S:
W/N trial court erred in finding accused Elizabeth coral guilty beyond
reasonable doubt of the crimes of illegal recruitment and on four (4) separate
counts of estafa.
HELD:
No. The crime of illegal recruitment has two elements: (1) that the offender is
a non-licensee or non-holder of authority to lawfully engage in the recruitment
and placement of workers; and (2) that the offender undertakes any of the
recruitment activities defined under Article 13 (b) of the Labor Code, as
amended, or any prohibited practices enumerated under Article 34 of the same
Code.
In the case at bench, accused-appellant does not dispute that she is neither a
licensee nor a holder of any authority to engage in recruitment and placement
activities. It is likewise established that private complainants were unaware of
accused- appellant's lack of authority when they transacted business with her.
It was only later, when private complainants sought the assistance of the
POEA that they discovered accused-appellant's lack of authority. In fine, the
first element of the crime of illegal recruitment was clearly proved in the case
at bench.
We next resolve whether the prosecution established the second element of
the offense of illegal recruitment, i.e., that accused-appellant undertook any of
the recruitment activities defined under Article 13 (b) of the Labor Code, as
amended, or any of the prohibited activities defined under Article 34 of the
same code. Accused-appellant urged it was not she who "recruited" private
complainants, but Nora Rubias. She alleged that Rubias brought them to her
and that they pleaded to be given jobs even only as househelpers.
We find the submission of accused-appellant untenable. In the first place, even
assuming she did not directly recruit private complainants, it is abundantly
clear from their testimonies that Rubias led them to believe she was acting for,
or at least with the tacit consent of accused-appellant. This belief was
buttressed when accused-appellant made no disclaimer to private
complainants of Rubia's authority when the latter accompanied them to
accused-appellant's office in Manila. In the second place, even downgrading
the participation of Rubias in the recruitment scheme, private complainants
proved that accused-appellant herself promised them jobs in Taiwan and
Korea. They paid various sums of money to accused-appellant to take care of
the expenses for the processing of their passports and visas. It was even
accused-appellant who accompanied Casiano to South Korea.
11. PP VS. TAGUBA
FACTS:
Enrique Taguba and Mirafe Taguba were both charged with eight counts of
illegal recruitment and three counts of estafa.
The complainants, namely, Jesus Garcia, Gilbert Fabrigas, Josefina Sarrion,
Myrna Roxas, Elena Santiago, Federico Sagurit, Manuel Aquiban, Violeta
Porte, Renelito Cerbito, Danilo Pacheco, narrated almost identical versions of
the deception practiced on them by the accused.
These witnesses testified that Enrique an Mirafe approached them on
separate occasions and assured them that upon their payment of a specified
sum of money they would be sent to Korror, Palau, to work variously as a
waiter, fisherman, master cutter, dressmaker, farmer, laborer, mason
carpenter or macho dancer. The consideration for their recruitment ranged
from P2,200.00 to P20,000.00 while the promised monthly wages ranged from
$300.00 top $500.00.
The required payments were made by them from loans they had contracted or
from the proceeds of the sale of their properties. However, no overseas
employment materialized. Only Gilbert Fabrigas and Norman Sarrion, the son
of Josefina Sarrion were able to reach Korror but after three months, during
which they were not given any work, they were deported to Manila for expired
visas. The rest of the complainants were never even able to leave the
Philippines.
In his defense, Enrique Taguba first claimed that he merely happened to be at
RAY/DECO office when the complainants submitted their papers. RAY/DECO
is a corporation licensed to recruit workers for employment abroad with which
he had entered into a joint venture. From the office, the documents were
submitted to the foreign employer, who brought them to Korror.
He later declared that a special power of attorney issued to him by RAY/DECO
authorized him to recruit and hire contract workers. It was by virtue of this
authorization that he recruited the complainants. At the same hearing,
however, he retracted his statement, reiterating his earlier claim that he had
no participation in the complainants' transactions with the company. The sole
exception was when he accompanied Gilbert Fabrigas and Norman Sarrion to
Korro upon RAY/DECO's request.
Mirafe, on the other hand, averred that she was working as a domestic helper
in Korror when the alleged irregularities happened. She presented a round-trip
Continental Airline ticket issued in her name on May 3, 1985, for Manila -
Korror - Manila and a certification issued by the Manager of Air Nauru that on
March 3, 1986, she was a passenger of Air Nauru Flight No. 420 bound for
Manila from Korror.
After trial, Judge Adoracion C. Angeles of the Regional Trial Court in Caloocan
City declared them guilty of all the charges in a decision dated June 4, 1990.
In their challenged to the decision, the appellants stress that they call the
failure of the prosecution to prove that they were not holders of licenses to
engage in the recruitment and placement of workers abroad; the unrebutted
evidence of Marife Taguba's absence in the Philippines during the commission
of the alleged crimes; the imposition of a penalty which was not yet in effect
and the alleged crime of illegal recruitment on a grand scale were committed;
and the lack of sufficient evidence to support their conviction for estafa.
The appellants argue that before one can be held guilty of illegal recruitment,
two elements have to be established, to wit, that (1) the offender is not a
licensee or holder of authority to lawfully engage in the recruitment and
placement of workers; and (2) the offender undertook the recruitment activities
defined under Article 13(b) or any of the prohibited practices enumerated
under Article 34 of the Labor Code. Their argument is that the prosecution has
the burden of proving beyond reasonable doubt each of the elements of the
offense charged and that this burden had not been discharged in the cases
against them.
ISSUE/S:
a. W/N the prosecution failed to prove that they were not holders of licenses
to engage in the recruitment and placement of workers abroad.
b. W/N they cannot be convicted of illegal recruitment on a large scale.
HELD:
a. No. The record shows that the prosecution indeed failed to establish that
the appellants had not been issued licenses to recruit for overseas
employment. Non-possession of a license to recruit is an essential ingredient
of the crime of illegal recruiting. As it is an indispensible requisite for the
conviction of the pretended recruiter, the burden of establishing this element
is upon the prosecution. In the case before us, the prosecution cannot deny
its failure to show that no license had indeed been issued to either of the
appellees by the POEA.
This would have been a fatal omission under ordinary circumstances.
Fortunately for the prosecution, however, this flaw was repaired by appellant
Enrique Taguba himself when he testified as follows: Q. In connection with
the operation of your office, do you have the authority to recruit? A. I have a
special power of attorney issued by the general manager of Ray/Deco,
International Development Corporation.
The special power of attorney granted to Enrique by RAY/DECO did not
operate as a license to recruit workers on his own behalf, which is what he did.
Enrique's authority was confined to negotiating with foreign employers for the
appointment of RAY/DECO as their agency in the recruiting of Filipino workers
for employment abroad. What he was supposed to recruit was not Filipino
overseas workers but the foreign employers to which the workers were to be
assigned.
b. Yes. The Court agrees that the appellants cannot be convicted of illegal
recruitment on a large scale because only two of the complainants, Jesus
Garcia and Elena Santiago, categorically testified that their recruitment came
after February 10, 1986. This was the date when P.D. 2018, the law defining
and penalizing illegal recruitment in a large scale, took effect.
P.D. 2018 cannot apply to the appellants retroactively as it would be an ex
post facto law to them. A law is ex post facto if it refers to a criminal act,
punishes an act which was innocent when done, and retroacts to the
disadvantage of the accused.26 Prior to the said date, recruiting on a large
scale was not yet punished with the penalty imposed in the said decree.
Moreover, each of the eight informations for illegal recruitment charged the
appellants with illegally recruiting only one person.
12. PP VS. GOCE
FACTS:
An information for illegal recruitment committed by a syndicate and in large
scale, punishable under Articles 38 and 39 of the Labor Code (Presidential
Decree No. 442) as amended by Section 1(b) of Presidential Decree No. 2018,
was filed against spouses Dan and Loma Goce and herein accused-appellant
Nelly Agustin in the Regional Trial Court of Manila, Branch 5, alleging: That in
or about and during the period comprised between May 1986 and June 25,
1987, both dates inclusive, in the City of Manila, Philippines, the said accused,
conspiring and confederating together and helping one another, representing
themselves to have the capacity to contract, enlist and transport Filipino
workers for employment abroad, did then and there willfully and unlawfully, for
a fee, recruit and promise employment/job placement abroad, to (1) Rolando
Dalida y Piernas, (2) Ernesto Alvarez y Lubangco, (3) Rogelio Salado y Savillo,
(4) Ramona Salado y Alvarez, (5) Dionisio Masaya y de Guzman, (6) Dave
Rivera y de Leon, (7) Lorenzo Alvarez y Velayo, and (8) Nelson Trinidad y
Santos, without first having secured the required license or authority from the
Department of Labor.
Four of the complainants testified for the prosecution. Rogelio Salado was the
first to take the witness stand and he declared that he was introduced by
Lorenzo Alvarez, his brother-in-law and a co-applicant, to Nelly Agustin in the
latter's residence. Representing herself as the manager of the Clover
Placement Agency, Agustin showed him a job order as proof that he could
readily be deployed for overseas employment. Salado learned that he had to
pay P5,000.00 as processing fee, which amount he gave sometime in April or
May of the same year. He was issued the corresponding receipt.
Also, Salado, accompanied by five other applicants who were his relatives,
went to the office of the placement agency at Nakpil Street, Ermita, Manila
where he saw Agustin and met the spouses Dan and Loma Goce, owners of
the agency. He submitted his bio-data and learned from Loma Goce that he
had to give P12,000.00, instead of the original amount of P5,000.00 for the
placement fee. Although surprised at the new and higher sum, they
subsequently agreed as long as there was an assurance that they could leave
for abroad.
Thereafter, a receipt was issued in the name of the Clover Placement Agency
showing that Salado and his aforesaid co-applicants each paid P2,000.00,
instead of the P5,000.00 which each of them actually paid. Several months
passed but Salado failed to leave for the promised overseas employment.
Hence, in October, 1987, along with the other recruits, he decided to go to the
POEA to verify the real status of Clover Placement Agency. They discovered
that said agency was not duly licensed to recruit job applicants. Later, upon
learning that Agustin had been arrested, Salado decided to see her and to
demand the return of the money he had paid, but Agustin could only give him
P500.00.
Ramona Salado, the wife of Rogelio Salado, came to know through her
brother, Lorenzo Alvarez, about Nelly Agustin. Accompanied by her husband,
Rogelio, Ramona went to see Agustin at the latter's residence. Agustin
persuaded her to apply as a cutter/sewer in Oman so that she could join her
husband. Encouraged by Agustin's promise that she and her husband could
live together while working in Oman, she instructed her husband to give
Agustin P2,000.00 for each of them as placement fee, or the total sum of
P4,000.00.
Much later, the Salado couple received a telegram from the placement agency
requiring them to report to its office because the "NOC" (visa) had allegedly
arrived. Again, around February, or March, 1987, Rogelio gave P2,000.00 as
payment for his and his wife's passports. Despite follow-up of their papers
twice a week from February to June, 1987, he and his wife failed to leave for
abroad.
Complainant Dionisio Masaya, accompanied by his brother-in-law, Aquiles
Ortega, applied for a job in Oman with the Clover Placement Agency at
Paraaque, the agency's former office address. There, Masaya met Nelly
Agustin, who introduced herself as the manager of the agency, and the Goce
spouses, Dan and Loma, as well as the latter's daughter. He submitted several
pertinent documents, such as his bio-data and school credentials.
Masaya gave Dan Goce P1,900.00 as an initial downpayment for the
placement fee, and in September of that same year, he gave an additional
P10,000.00. He was issued receipts for said amounts and was advised to go
to the placement office once in a while to follow up his application, which he
faithfully did. Much to his dismay and chagrin, he failed to leave for abroad as
promised. Accordingly, he was forced to demand that his money be refunded
but Loma Goce could give him back only P4,000.00 in installments.
As the prosecution's fourth and last witness, Ernesto Alvarez took the witness
stand on June 7, 1993. He testified that in February, 1987, he met appellant
Agustin through his cousin, Larry Alvarez, at her residence in Paraaque. She
informed him that "madalas siyang nagpapalakad sa Oman" and offered him
a job as an ambulance driver at the Royal Hospital in Oman with a monthly
salary of about $600.00 to $700.00.
Alvarez gave an initial amount of P3,000.00 as processing fee to Agustin at
the latter's residence. In the same month, he gave another P3,000.00, this
time in the office of the placement agency. Agustin assured him that he could
leave for abroad before the end of 1987. He returned several times to the
placement agency's office to follow up his application but to no avail.
Frustrated, he demanded the return of the money he had paid, but Agustin
could only give back P500.00. Thereafter, he looked for Agustin about eight
times, but he could no longer find her.
Only herein appellant Agustin testified for the defense. She asserted that Dan
and Loma Goce were her neighbors at Tambo, Paraaque and that they were
licensed recruiters and owners of the Clover Placement Agency. Previously,
the Goce couple was able to send her son, Reynaldo Agustin, to Saudi Arabia.
Agustin met the aforementioned complainants through Lorenzo Alvarez who
requested her to introduce them to the Goce couple, to which request she
acceded.
Denying any participation in the illegal recruitment and maintaining that the
recruitment was perpetrated only by the Goce couple, Agustin denied any
knowledge of the receipts presented by the prosecution. She insisted that the
complainants included her in the complaint thinking that this would compel her
to reveal the whereabouts of the Goce spouses. She failed to do so because
in truth, so she claims, she does not know the present address of the couple.
All she knew was that they had left their residence in 1987.
Although she admitted having given P500.00 each to Rogelio Salado and
Alvarez, she explained that it was entirely for different reasons. Salado had
supposedly asked for a loan, while Alvarez needed money because he was
sick at that time.
Trial court rendered judgment finding herein appellant guilty as a principal in
the crime of illegal recruitment in large scale, and sentencing her to serve the
penalty of life imprisonment, as well as to pay a fine of P100,000.00.
ISSUE/S:
a. W/N appellants act of introducing complainants to the Goce couple fall
within the meaning of illegal recruitment and placement under Article 13(b) in
relation to Article 34 of the Labor Code.
b. W/N appellant Agustin merely introduced complainants to the Goce couple
or her actions went beyond that.
HELD:
a. Yes. The recruitment and placement refers to any act of canvassing,
enlisting, contracting, transporting, utilizing, hiring or procuring workers, and
includes referrals, contract services, promising or advertising for employment,
locally or abroad, whether for profit or not; provided, that any person or entity
which, in any manner, offers or promises for a fee employment to two or more
persons shall be deemed engaged in recruitment and placement. 25 On the
other hand, referral is the act of passing along or forwarding of an applicant
for employment after an initial interview of a selected applicant for employment
to a selected employer, placement officer or bureau.
b. Yes. The testimonial evidence hereon show that she indeed further
committed acts constitutive of illegal recruitment. All four prosecution
witnesses testified that it was Agustin whom they initially approached
regarding their plans of working overseas. It was from her that they learned
about the fees they had to pay, as well as the papers that they had to submit.
It was after they had talked to her that they met the accused spouses who
owned the placement agency.
As correctly held by the trial court, being an employee of the Goces, it was
therefore logical for appellant to introduce the applicants to said spouses, they
being the owners of the agency. As such, appellant was actually making
referrals to the agency of which she was a part. She was therefore engaging
in recruitment activity.
13. PP VS. BAUTISTA
FACTS:
Anita Bautista approached Romeo Paguio at the latter's restaurant and offered
job openings abroad. At that time, Paguio had relatives who were interested
to work abroad. Accused, who also operated a restaurant nearby at Padre
Faura, informed Paguio that she knew somebody who could facilitate
immediate employment in Taiwan for Paguio's relatives. Accused Anita
Bautista introduced Rosa Abrero to Paguio. Abrero informed him that the
applicants could leave for Taiwan within a period of one-month from the
payment of placement fees. They informed Paguio that the placement fee was
P40,000.00 for each person. Paguio contacted his relatives, complainants
Remigio Fortes and Dominador Costales who were his brothers-in-law, and
Anastacio Amor, a cousin, who lost no time raising the needed money and
gave the same to Paguio. The three were to work as factory workers and were
to be paid $850.00 monthly salary each. Paguio gave Rosa Abrero
P20,000.00, which would be used in following up the papers of the
complainants; later he gave accused P40,000.00 and P60,000.00 in separate
amounts, totalling P100,000.00, as the remaining balance. Abrero and
accused Bautista promised Paguio and complainants that the latter could
leave for Taiwan. But accused Bautista informed Paguio and complainants
that there was a delay in the latter's departure because their tickets and visas
had not yet been released. Accused re-scheduled the complainants'
departure. Came the date, and complainants were still not able to leave.
Paguio then required accused Bautista to sign the "Acknowledgment Receipt,"
in which accused admitted having received the sum of P100,000.00 from
Paguio, representing payment of plane tickets, visas and other travel
documents. Paguio asked accused to return complainants' money; accused,
however, promised that complainants could leave for Taiwan before
Christmas. From POEA, Paguio secured a certification, attesting that Annie
Bautista and Rosa Abrero are not licensed or authorized to recruit workers for
overseas employment. Complainants Fortes, Amor and Costales, as well as
Paguio, gave their written statements at the Office of the Assistant Chief
Directorial Staff for Intelligence of the WPDC, complaining about their being
victims of illegal recruitment by Rosa Abrero and Annie Bautista.
ISSUE/S:
W/N reasonable doubt exists to warrant the acquittal of appellant Anita
Bautista.
HELD:
No. The Labor Code defines recruitment and placement as referring to "any
act of canvassing, enlisting, contracting, transporting, utilizing, hiring or
procuring workers, and includes referrals, contract services, promising or
advertising for employment, locally or abroad, whether for profit or not:
Provided that any person or entity which, in any manner, offers or promises
for a fee employment to two or more persons shall be deemed engaged in
recruitment and placement."
It is settled that the essential elements of the crime of illegal recruitment in
large scale are: (1) the accused engages in the recruitment and placement of
workers, as defined under Article 13 (b) or in any prohibited activities under
Article 34 of the Labor Code; (2) accused has not complied with the guidelines
issued by the Secretary of Labor and Employment, particularly with respect to
the securing of a license or an authority to recruit and deploy workers, either
locally or overseas; and (3) accused commits the same against three (3) or
more persons, individually or a group.
Appellant's active participation in the recruitment process of complainants
belies her claim of innocence. Complainants' recruitment was initiated by
appellant during her initial meeting with Romeo Paguio. She gave the
impression to Romeo Paguio and the complainants that her cohort, Rosa
Abrero, could send workers for employment abroad. She introduced Rosa
Abrero to Romeo Paguio. Both women assured the departure of complainants
to Taiwan within one month from payment of the placement fee of P40,000.00
per person. They even claimed that complainants would work as factory
workers for a monthly salary of $850.00 per person. Moreover, it was appellant
who informed Romeo Paguio that complainants' scheduled trip to Taiwan,
instead of the original departure date of September 25, 1991, due to some
problems on their visas and travel documents.
14. PP VS. CABACANG
FACTS:
Illegal Recruitment case was filed against appellant Felicia Mazambique
Cabacang for allegedly committing the following act: That in or about and
during the period comprised from March 22, 1990 to April 27, 1990, both dates
inclusive, in the City of Manila, Philippines, the said accused, representing
herself to have the capacity to contract, enlist and transport Filipino workers
for employment abroad, did then and there willfully and unlawfully, for a fee,
recruit and promise employment/job placement abroad to the following
persons: Romeo Eguia, Ronnie Reyes, Armando Castro and Dante Eguia,
without first having secured the required license or authority from the
Department of Labor and Employment.
The prosecution evidence show that appellant who is not a recruiter licensed
by the POEA, handled the processing of the papers of cousins Ramon Eguia
and Edgardo Santos. The two were deployed to Abu Dhabi for employment as
janitors. Private complainants were encouraged by their employment, and
decided to apply for overseas janitorial work as well.
According to private complainant Ronnie Reyes, he was approached in Lipa
by appellant who represented herself as the Assistant Manager of the Lakas
Agency Management Corporation. Appellant informed him that there would be
a second batch of overseas workers to be deployed to Abu Dhabi. Ronnie
relayed the information to Wilma, who made further inquiries and verifications
from appellant about the job opportunity. Wilma then directly worked out with
appellant, the overseas job applications of private complainants.
Private complainants filed their applications and appellant assured them that
they would be able to leave for Abu Dhabi after the processing of their
paper. She instructed them to pay their processing fees directly to her. Wilma
paid appellant a total of P32,500.00.
Appellant assured private complainants they could leave for Abu Dhabi. The
date of departure came without private complainants leaving Philippine soil.
Thereafter, appellant told them to stay put and wait for the arrival in the
Philippines of their prospective Middle Eastern employer. However, no
employer arrived, and the four complainants failed to be deployed by appellant
overseas.
Private complainants and Wilma returned to the Lakas Agency to look for
appellant. They did not find her. It was then that they found out from the
agency's Manager, MR. NARCISO DELA FUENTE, that appellant was merely
renting a table in the office and was not, employed with Lakas. The revelation
moved private complainants to file a complaint against appellant with the NBI.
The NBI was able to work out a settlement between the parties. Appellant
agreed in writing to pay back the processing fees of private
complainants. Nonetheless, appellant did not fully fulfill her obligation under
the agreement. She only refunded a total of 6,700.00 to private complainants.
At trial's end, appellant was found guilty of illegal recruitment.
ISSUE/S:
a. W/N appellant cannot be held liable for illegal recruitment since she never
represented herself to private complainants as a POEA-licensed recruiter.
b. W/N appellant was not the one responsible for the recruitment of private
complainants nor for their non-deployment for work abroad, since she was
merely an employee of the POEA-licensed Lakas Agency Management
Corporation.
HELD:
a. No. It is incorrect to maintain that to be liable for illegal recruitment, one
must represent himself/herself to the victims as a duly-licensed recruiter.
Illegal recruitment is defined in Article 38 (a) of the Labor Code, as amended,
as "(a)ny recruitment activities, including the prohibited practices enumerated
under Article 34 of this Code, to be undertaken by non-licensees or non-
holders of authority." Article 13 (b) of the same Code defines "recruitment and
placement" as referring to: (A)ny act of canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring workers, and includes referrals,
contract services, promising or advertising for employment, locally or abroad,
whether for profit or not: Provided, That any person or entity which in any
manner, offers or promises for a fee employment to two or more persons shall
be deemed engaged in recruitment and placement.
Clearly, to prove illegal recruitment, only two elements need to be shown: (1)
the person charged with the crime must have undertaken recruitment activities
(or any of the activities enumerated in Article 34 of the Labor Code, as
amended); and (2) said person does not have a license or authority to do so.
It is not required that it be shown that such person wrongfully represented
himself as a licensed recruiter.
b. No. Appellant cannot successfully contend she merely performed her duties
as an employee of a licensed recruitment agency. Apart from her
uncorroborated testimony on the matter, she failed to present credible
evidence to buttress her claim of employment.
Clearly, it was appellant who directly recruited private complainants within the
meaning of Article 38 (a) and (b) the Labor Code. Since it is undisputed that
appellant is not a holder of a license or authority to recruit from the Department
of Labor, through the POEA, her acts constitute illegal recruitment.
In the case at bench, since appellant was charged with and convicted of
illegally recruiting four (4) people, her crime is classified as having been
committed in large scale, as such, it is considered as involving economic
sabotage.
15. People vs. Panis
Facts: Four separate criminal complaints were filed against Abug for operating
a free-charging employment agency without first securing a license. But Abug
argued that the complaints did not charge an offense as he was charged with
illegality recruiting only one person in each of the four informations. Abug
claimed that under Article 13(b) there would be illegal recruitment only when
two or more persons in any manner were promised or offered any employment
for a fee.
Issue: Whether or not the number of persons is an essential ingredient of the
act of recruitment and placement of workers.
Held: The court ruled that the number of persons is not an essential ingredient
of the act of recruitment and placement of workers As we see it, the proviso
was intended neither to impose a condition on the basic rule nor to provide an
exception thereto but merely to create a presumption. The presumption is that
the individual or entity is engaged in recruitment and placement whenever he
or it is dealing with two or more persons to whom, in consideration of a fee, an
offer or promise of employment is made in the course of the canvassing,
enlisting, contracting, transporting, utilizing, hiring or procuring of workers.
The number of persons dealt with is not an essential ingredient of the act of
recruitment and placement of workers. Any of the acts mentioned in the basic
rule in Article 13(b) will constitute recruitment and placement even if only one
prospective worker is involved. The proviso merely lays down a rule of
evidence that where a fee is collected in consideration of a promise or offer of
employment to two or more prospective workers, the individual or entity
dealing with them shall be deemed to be engaged in the act of recruitment and
placement. The words shall be deemed create that presumption.
16. People vs. Dela Piedra
Facts: Maria Lourdes Modesto and Nancy Araneta together with her friends
Jennelyn Baez, and Sandra Aquino went to the house of Jasmine Alejandro,
after having learned that a woman is there to recruit job applicants for
Singapore. Carol dela Piedra was already briefing some people when they
arrived. Jasmine, on the other hand, welcomed and asked them to sit down.
They listened to the recruiter who was then talking about the breakdown of
the fees involved: P30,000 for the visa and the round trip ticket, and P5,000
as placement fee and for the processing of the papers. The initial payment
was P2,000, while P30,000 will be by salary deduction. The recruiter said that
she was recruiting nurses for Singapore.
Araneta, her friends and Lourdes then filed up bio-data forms and were
required to submit pictures and a transcript of records. After the interview,
Lourdes gave the initial payment of P2,000 to Jasmine, who assured her that
she was authorized to received money.
Meanwhile, Erlie Ramos, Attorney II of the Philippine Overseas Employment
Agency (POEA), received a telephone call from an unidentified woman
inquiring about the legitimacy of the recruitment conducted by a certain Mrs.
Carol Figueroa. Ramos, whose duties include the surveillance of suspected
illegal recruiters, immediately contacted a friend, a certain Mayeth Bellotindos
so they could both go the place where the recruitment was reportedly being
undertaken. Upon arriving at the reported area at around 4:00 pm, Bellotindos
entered the house and pretended to be an applicant. Ramos remained outside
and stood on the pavement, from where he was able to see around 6 persons
in the sala. Ramos even heard a woman, identified as Carol Figueroa, talk
about the possible employment she has to provide in Singapore and the
documents that the applicants have to comply with. Fifteen minutes later,
Bellotindos came out with bio-data form in hand.
Thereafter, Ramos conferred with a certain Capt. Mendoza of the Criminal
Investigation Service (CIR) to organize the arrest of the alleged illegal
recruiter. A surveillance team was then organized to confirm the report. After
which, a raid was executed.
Consequently, Carol was charged and convicted by the trial court of illegal
recruitment.
Upon appeal, accused questions her conviction for illegal recruitment in large
scale and assails, as well, the constitutionality of the law defining and
penalizing said crime.
Issue: Whether herein appellant committed the crime of large scale illegal
recruitment.
Held: No. A conviction for large scale illegal recruitment must be based on a
finding in each case of illegal recruitment of three or more persons whether
individually or as a group. In this case, only two persons, Araneta and
Modesto, were proven to have been recruited by appellant. The third person
named in the complaint as having been promised employment for a fee,
Jennelyn Baez, was not presented in court to testify.
Appellant is accused of recruiting only the three persons named in the
information Araneta, Modesto and Baez. The information does not include
Fermindoza or the other persons present in the briefing as among those
promised or offered employment for a fee. To convict appellant for the
recruitment and placement of persons other than those alleged to have been
offered or promised employment for a fee would violate her right to be informed
of the nature and cause of the accusation against her.
17. Hornales vs. NLRC
Facts: Mario Hornales, together with other Filipinos, were sent to Singapore
by JEAC International Management & Contractor Services. Upon arrival, they
were met the owner of Step-Up Employment Agency Victor Lim, and were told
that there would be working as fishermen.
On board the vessel, Hornales and others were subjected to inhuman working
conditions, such as inadequate supply of food and water, maltreatment by the
captain, and lack of medical attendance. They were also required to work 22
hours a day without pay. Unable to bear the situation, Hornales and some
other Filipinos left the vessel.
Upon return to the Philippines, Hornales asked JEAC to pay his salaries. In
turn, JEAC required him to surrender his passport promising that they would
procure another job for him, and later gave him P500.
Hornales filed with POEA a complaint for non-payment of wages and recovery
of damages against JEAC, its owner Canayan, and Country Bankers
Insurance Corporation, its surety.
JEAC-Canayans defense was Horanales is a total stranger to them and this
was supported by a Joint Affidavit stating that Hornales admitted to them that
he didnt apply to any agency, that he went to Singapore as a tourist, and that
he applied directly to Step-up Agency; and by a Certification from Step-Up
Agency corroborating the statements in the Joint Affidavit.
In Hornales supplemental Affidavit, he claimed that he knew Canayan since
1990, and the latter reminded him of his obligations by sending him
photocopies of the PNP Checks Canayan issue in his favor.
POEA in favour of Hornales.
NLRC dismissed complaint; no employee-employer relationship.
Issue: WON JEAC and Canayan were responsible for Hornales recruitment
and deployment to Singapore.
Held: Yes. POEAs decision was more convincing and supported by
substantial evidence.
Join Affidavit It has no provative value because Hornales was not able to
cross-examine it and affiants merely swore as to what Hornales told them, by
not as to the truth of the statements.
PNP Checks and agreements - strongly disprove Canayans total strangers
theory and his participation in Hornales recruitment and deployment.
It is very unlikely for Hornales to go to Singapore as a tourist and then land a
job without knowing anyone.
JEAC and Canayans argument that they cannot be held liable because there
was no employment contract and that the absence of a Special Power of
Attorney and Affidavit of Responsibility, as required by the POEA rules and
regulations only proves that they did not employ Hornales to Singapore. The
Court said that these act of not complying with POEA Rules and Regulations
requirement only made them susceptible to cancellation of suspension of
license as provided by POEA Rules Regulations.
18. Nitto Enterprises vs. NLRC
Facts: Petitioner Nitto Enterprises, a company engaged in the sale of glass
and aluminum products, hired Roberto Capili sometime in May 1990 as an
apprentice machinist, molder and core maker as evidenced by an
apprenticeship agreement 2 for a period of six (6) months from May 28, 1990
to November 28, 1990 with a daily wage rate of P66.75 which was 75% of the
applicable minimum wage.
On August 3, 1990, Capili was asked to resign in a letter.
Capili signed the letter and executed a Quitclaim and Release in favor of
petitioner for and in consideration of the sum of P1,912.79. Three days after,
he filed a complaint for illegal dismissal and payment of other monetary
benefits.
The Labor Arbiter found the termination valid and dismissed the money claim.
But on appeal, the NLRC reversed the decision and directed Nitto to reinstate
Capili with backwages because he was a regular employee who was illegally
dismissed.
The employer assails the NLRCs finding that Capili cannot be considered an
apprentice since no apprenticeship agreement was executed and Capili was
employed on May 28, 1990. However, the apprenticeship agreement was filed
with DOLE only on June 7, 1990. The approval by DOLE of the apprenticeship
agreement came much later.
Held: Petitioner did not comply with the requirements of the law (see Article
61, Labor Code) which provides that apprenticeship agreements shall be
entered into by the employer and apprentice only in accordance with the
apprenticeship program duly approved by the Minister of Labor and
Employment.
The apprenticeship agreement between Nitto and Capili has no force and
effect in the absence of a valid apprenticeship program duly approved by the
DOLE. Hence, Capilis assertion that he was hired not as an apprentice but as
a delivery boy (kargador of pahinante) deserves credence. He should be
considered a regular employee.
19. Dee C. Chan and Sons vs. CIR
Facts: Pending settlement by the Court of Industrial Relations (Now NLRC) of
a labor dispute between petitioner company and its labor union, petitioner
requested for authority to hire about 12 more laborers from time to time and
on a temporary basis. This request was granted by the CIR with the proviso,
however, that the majority of the laborers to be employed should be native.
Petitioner assails the constitutionality of the said proviso.
1) Is the petitioner entitled to challenge the constitutionality of the
order on the ground of denial of equal protection of the laws insofar
as it restricts the number of aliens that may be employed in any
business?
2) Does the order sustain the petitioners right to hire labor?
Held: 1) The petitioner is not entitled to challenge the constitutionality of an
order which does not adversely affect it, in behalf of aliens who are prejudiced
thereby. It is the prospective alien employee who may do so and only when
and so far as it is being, or is about to be, applied to his advantage.
2) The employers right to hire labor is not absolute. The Legislature has the
power to make regulations subject only to the condition that they pass the
reasonableness and public interest test. And under Commonwealth Act No.
103, the CIR may specify that a certain proportion of the additional laborers to
be employed should be Filipinos, if such condition, in the courts opinion, is
necessary or expedient for the purpose of settling disputes, preventing further
disputes, or doing justice to the parties.
20. University of Pangasinan Faculty Union vs. University of Pangasinan
Facts: The petitioners members are full-time professors, instructors, and
teachers of respondent University. The teachers in the college level teach for
a normal duration of ten (10) months a school year, divided into two (2)
semesters of five (5) months each, excluding the two (2) months summer
vacation. These teachers are paid their salaries on a regular monthly basis.
In November and December, 1981, the petitioners members were fully paid
their regular monthly salaries. However, from November 7 to December 5,
during the semestral break, they were not paid their ECOLA. The private
respondent claims that the teachers are not entitled thereto because the
semestral break is not an integral part of the school year and there being no
actual services rendered by the teachers during said period, the principle of
"No work, no pay" applies.
Held: It is beyond dispute that the petitioners members are full-time
employees receiving their monthly salaries irrespective of the number of
working days or teaching hours in a month. However, they find themselves in
a most peculiar situation whereby they are forced to go on leave during
semestral breaks. These semestral breaks are in the nature of work
interruptions beyond the employees control. The duration of the semestral
break varies from year to year dependent on a variety of circumstances
affecting at times only the private respondent but at other times all educational
institutions in the country. As such, these breaks cannot be considered as
absences within the meaning of the law for which deductions may be made
from monthly allowances. The "No work, no pay" principle does not apply in
the instant case. The petitioners members received their regular salaries
during this period. It is clear from the aforequoted provision of law that it
contemplates a "no work" situation where the employees voluntarily absent
themselves. Petitioners, in the case at bar, certainly do not, ad voluntatem,
absent themselves during semestral breaks. Rather, they are constrained to
take mandatory leave from work. For this they cannot be faulted nor can they
be begrudged that which is due them under the law. To a certain extent, the
private respondent can specify dates when no classes would be held. Surely,
it was not the intention of the framers of the law to allow employers to withhold
employee benefits by the simple expedient of unilaterally imposing "no work"
days and consequently avoiding compliance with the mandate of the law for
those days.chanrobles.com.
Sec. 4. Principles in Determining Hours Worked. The following general
principles shall govern in determining whether the time spent by an employee
is considered hours worked for purposes of this Rule:chanrob1es virtual 1aw
library
"(d) The time during which an employee is inactive by reason of interruptions
in his work beyond his control shall be considered time either if the imminence
of the resumption of work requires the employees presence at the place of
work or if the interval is too brief to be utilized effectively and gainfully in the
employees own interest."
The petitioners members in the case at bar, are exactly in such a situation.
The semestral break scheduled is an interruption beyond petitioners control
and it cannot be used "effectively nor gainfully in the employees interest.
Thus, the semestral break may also be considered as "hours worked." For
this, the teachers are paid regular salaries and, for this, they should be entitled
to ECOLA. Not only do the teachers continue to work during this short recess
but much less do they cease to live for which the cost of living allowance is
intended. The legal principles of "No work, no pay; No pay, no ECOLA" must
necessarily give way to the purpose of the law to augment the income of
employees to enable them to cope with the harsh living conditions brought
about by inflation; and to protect employees and their wages against the
ravages brought by these conditions.
21. Wellington Investment and Manufacturing Corp. vs. Trajano
Facts: By virtue of the routine inspection conducted by a Labor Enforcement
Officer, Wellington Flour Mills owned by the petitioner-company was found
non-payment of regular holidays falling on a Sunday for monthly-paid
employees. Wellington argued that the monthly-paid employees already
includes holiday pay for all regular holidays and there is no legal basis for the
finding of alleged non-payment of regular holidays falling on a Sunday. It
further contends that it pays its monthly paid employees a fixed monthly
compensation using the 314 factor which undeniably covers and already
includes payment for all the working days in a month as well as all the 10 un-
worked regular holidays within a year. The Regional Director ordered the
petitioner to pay the employees additional compensation corresponding to 4
extra working days. However, the petitioner argued that the company, using
the 314 factor already gave complete payment of all compensation due to its
workers. Petitioner appealed and was acted on by the respondent
Undersecretary. But still, Regional Directors decision was affirmed.
Issue: Whether or not a monthly-paid employees, receiving a fixed monthly
compensation, is entitled to an additional pay aside from his usual holiday pay
whenever a regular holiday falls on a Sunday.
Held: Regional Directors decision, affirmed by the Undersecretary, is nullified
and set aside. Every worker should be paid his regular daily wage during
regular holidays; except in retail and service establishments regularly
employing less than 10 workers, even if the worker does not work on these
regular holidays.
Particularly as regards employees "who are uniformly paid by the month, "the
monthly minimum wage shall not be less than the statutory minimum wage
multiplied by 365 days divided by twelve." This monthly salary shall serve as
compensation "for all days in the month whether worked or not," and
"irrespective of the number of working days therein." In other words, whether
the month is of thirty (30) or thirty-one (31) days' duration, or twenty-eight (28)
or twenty-nine (29) (as in February), the employee is entitled to receive the
entire monthly salary.
The Wellington had been paying its employees a salary of not less than the
statutory minimum wage and that the monthly salary, thus, paid was not less
than the statutory minimum wage multiplied by 365 days divided by 12.
Apparently the monthly salary was fixed by Wellington to provide for
compensation for every working day of the year including holidays specified
by law and excluding only Sundays. Wellington leaves no day unaccounted
for, it is paying for all the days of a year with the exception only of 51 Sundays.
24. Ruga et.al vs. NLRC
Facts: Petitioners were the fishermen-crew members of 7/B Sandyman II, one
of several fishing vessels owned and operated by private respondent De
Guzman Fishing Enterprises which is primarily engaged in the fishing business
with port and office at Camaligan, Camarines Sur. Petitioners rendered service
aboard said fishing vessel.
For services rendered in the conduct of private respondent's regular business
of "trawl" fishing, petitioners were paid on percentage commission basis in
cash by one Mrs. Pilar de Guzman, cashier of private respondent. As agreed
upon, they received thirteen percent (13%) of the proceeds of the sale of the
fish-catch if the total proceeds exceeded the cost of crude oil consumed during
the fishing trip, otherwise, they received ten percent (10%) of the total
proceeds of the sale. The patron/pilot, chief engineer and master fisherman
received a minimum income of P350.00 per week while the assistant engineer,
second fisherman, and fisherman-winchman received a minimum income of
P260.00 per week.
Petitioners were told by Jorge de Guzman, president of private respondent, to
proceed to the police station at Camaligan, Camarines Sur, for investigation
on the report that they sold some of their fish-catch at midsea to the prejudice
of private respondent. Petitioners denied the charge claiming that the same
was a countermove to their having formed a labor union and becoming
members of Defender of Industrial Agricultural Labor Organizations and
General Workers Union (DIALOGWU).
During the investigation, no witnesses were presented to prove the charge
against petitioners, and no criminal charges were formally filed against them.
Petitioners individually filed their complaints for illegal dismissal and non-
payment of 13th month pay, emergency cost of living allowance and service
incentive pay, with the then Ministry (now Department) of Labor and
Employment, Regional Arbitration Branch No. V, Legaspi City, Albay. They
uniformly contended that they were arbitrarily dismissed without being given
ample time to look for a new job.
Issue: Whether or not the fishermen-crew members of the trawl fishing vessel
7/B Sandyman II are employees of its owner-operator, De Guzman Fishing
Enterprises.
Held: Disputing the finding of public respondent that a "joint fishing venture"
exists between private respondent and petitioners, petitioners claim that public
respondent exceeded its jurisdiction and/or abused its discretion when it
added facts not contained in the records when it stated that the pilot-crew
members do not receive compensation from the boat-owners except their
share in the catch produced by their own efforts; that public respondent
ignored the evidence of petitioners that private respondent controlled the
fishing operations; that public respondent did not take into account established
jurisprudence that the relationship between the fishing boat operators and their
crew is one of direct employer and employee.
We have consistently ruled that in determining the existence of an employer-
employee relationship, the elements that are generally considered are the
following (a) the selection and engagement of the employee; (b) the payment
of wages; (c) the power of dismissal; and (d) the employer's power to control
the employee with respect to the means and methods by which the work is to
be accomplished. The employment relation arises from contract of hire,
express or implied. In the absence of hiring, no actual employer-employee
relation could exist.
From the four (4) elements mentioned, we have generally relied on the so-
called right-of-control test where the person for whom the services are
performed reserves a right to control not only the end to be achieved but also
the means to be used in reaching such end. The test calls merely for the
existence of the right to control the manner of doing the work, not the actual
exercise of the right.
The petition is granted.
25. Songco et. Al. vs. NLRC
Facts: Zuelig terminated the services of Songco, and others, on the ground of
retrenchment due to financial losses. During the hearing, the parties agreed
that the sole issue to be resolved was the basis of computation of the
separation pay. The salesmen received monthly salaries of at least P400.00
and commissions for every sale they made.
The Collective Bargaining Agreement between Zuelig and the union of which
Songco. Et. Al were members contained the following provision: Any
employee who is separated from employment due to old age, sickness, death
or permanent lay-off, not due to the fault of said employee, shall receive from
the company a retirement gratuity in an amount equivalent to one (1) months
salary per year of service.
The Labor Arbiter ordered Zuelig to pay Songco, et. Al. separation pay
equivalent to their one month salary (exclusive of commissions, allowances,
etc.) for every year of service with the company.
Issue: Whether the earned sales commissions and allowances should be
included in the monthly salary of Songco, et. Al. for the purpose of computing
their separation pay.
Held: In the computation of backwages and separation pay, account must be
taken not only of the basic salary of the employee but also of the transportation
and emergency living allowances.
Even if the commissions were in the form of incentives or encouragement, so
that the salesman would be inspired to put a little more industry on the jobs
particularly assigned to them, still these commissions are direct remunerations
for services rendered which contributed to the increase of income of the
employer. Commission is the recompense compensation or reward of an
agent, salesman, executor, trustee, receiver, factor, broker or bailee, when the
same is calculated as a percentage on the amount of his transactions or on
the profit to the principal. The nature of the work of a salesman and the reason
for such type of remuneration for services rendered demonstrate that
commissions are of Songco, et. Al.s wage or Salary.
The Court takes judicial notice of the fact that some salesmen do not receive
any basic salary but depend on commissions and allowances or commissions
alone, although an employer-employee relationship exists.
26. Rosario Gaa vs. CA
Facts: Respondent Europhil Industries Corporation was formerly one of the
tenants in Trinity Building at T.M. Kalaw Street, Manila, while petitioner
Rosario A. Gaa was then the building administrator.
Europhil Industries commenced an action in the Court of First Instance of
Manila for damages against petitioner "for having perpetrated certain acts that
Europhil Industries considered a trespass upon its rights, namely, cutting of its
electricity, and removing its name from the building directory and gate passes
of its officials and employees"
A writ of garnishment was issued pursuant to which Deputy Sheriff Cesar A.
Roxas served a Notice of Garnishment upon El Grande Hotel, where petitioner
was then employed, garnishing her "salary, commission and/or remuneration."
Petitioner then filed with the Court of First Instance of Manila a motion to lift
said garnishment on the ground that her "salaries, commission and, or
remuneration are exempted from execution under Article 1708 of the New Civil
Code.
CFI: denied Gaas motion and her subsequent MR
CA: dismissed Gaas petition on the ground that GAA is not a mere laborer as
contemplated under Article 1708 as the term laborer does not apply to one
who holds a managerial or supervisory position like that of petitioner, but only
to those "laborers occupying the lower strata."
It also held that the term "wages" means the pay given" as hire or reward to
artisans, mechanics, domestics or menial servants, and laborers employed in
manufactories, agriculture, mines, and other manual occupation and usually
employed to distinguish the sums paid to persons hired to perform manual
labor, skilled or unskilled, paid at stated times, and measured by the day,
week, month, or season,"
Issue: WON Gaa may be considered a laborer as contemplated under Article
1708 of the CC.
Held: No. Gaa is not an ordinary or rank and file laborer but "a responsibly
place employee," of El Grande Hotel. Considering the importance of
petitioner's function in El Grande Hotel, it is undeniable that Gaa is occupying
a position equivalent to that of a managerial or supervisory position.
The word "laborer" includes everyone who performs any kind of mental or
physical labor, but as commonly and customarily used and understood, it only
applies to one engaged in some form of manual or physical labor.
Article 1708 used the word "wages" and not "salary" in relation to "laborer"
when it declared what are to be exempted from attachment and execution.
The term "wages" as distinguished from "salary", applies to the compensation
for manual labor, skilled or unskilled, paid at stated times, and measured by
the day, week, month, or season, while "salary" denotes a higher degree of
employment, or a superior grade of services, and implies a position of office:
by contrast, the term wages " indicates considerable pay for a lower and less
responsible character of employment, while "salary" is suggestive of a larger
and more important service.
27. Phil. Duplicators Inc. vs. NLRC
Facts: Phil. Duplicators Inc. pays its salesmen a small fixed or guaranteed
wage; the greater part of the latters wages or salaries being composed of the
sales or incentive commissions earned on actual sales of duplicating
machines closed by them. Thus the sales commissions received for every
duplicating machine sold constituted part of the basic compensation or
remuneration of the salesmen of the Philippine Duplicators for doing their job.
The Labor Arbiter directed Petitioner Duplicators to pay 13 th month pay to
private respondent employees computed on the basis of their fixed wages plus
sales commission.
Sec. 4 of the Supplementary Rules and Regulations Implementing PD No. 851
(Revised Guidelines Implementing 13th Month Pay) provides that overtime
pay, earning and other remuneration which are not part of the basic salary
shall not be included in the computation of the 13th month pay.
Petitioner Corporation contends that their sales commission should not be
included in the computation of the 13th month pay invoking the consolidated
cases of Boie-Takeda Chemicals, Inc. vs Hon. Dionisio dela Serna and
Philippine Fuji Xerox Corp. vs Hon. Crecencio Trajano, were the so-called
commissions of medical representatives of Boie-Takeda Chemicals and rank-
and-file employees of Fuji Xerox Co. were not included in the term basic
salary in computing the 13th month pay.
Issue: WON sales commissions comprising a pre-determined percent of the
selling price of the goods are included in the computation of the 13 th month
pay.
Held: Yes. These commission which are an integral part of the basic salary
structure of the Philippine Duplicators employees-salesmen, are not overtime
payments, nor profit-sharing payments nor any other fringe benefit. Thus,
salesmens commissions comprising a pre-determined percent of the selling
price of the goods were properly included in the term basic salary for
purposes of computing the 13th month pay.
Commissions of medical representatives of Boie-Takeda Chemicals and rank-
and-file employees of Fuji Xerox Co. were not included in the term basic
salary because these were paid as productivity bonuses which is not
included in the computation of 13th month pay.
28. BOSE Takeda Chemicals Inc. vs. Hon De La Serna
Facts: A routine inspection was conducted in the premises of petitioner Boie-
Takeda Chemicals, Inc. by Labor and Development Officer Reynaldo B.
Ramos. Finding that Boie-Takeda had not been including the commissions
earned by its medical representatives in the computation of their 13th month
pay, Ramos served a Notice of Inspection Results on Boie-Takeda through its
president, Mr. Benito Araneta, requiring Boie-Takeda within ten (10) calendar
days from notice to effect restitution or correction of "the underpayment of 13th
month pay for the years 1986, 1987 and 1988.
Boie-Takeda wrote the Labor Department contesting the Notice of Inspection
Results, and expressing the view "that the commission paid to our medical
representatives are not to be included in the computation of the 13th month
pay since thelaw and its implementing rules speak of REGULAR or BASIC
salary and therefore exclude all other remunerations which are not part of the
REGULAR salary." It pointed out that, "if no sales is made under the effort of
a particular representative, there is no commission during the period when no
sale was transacted, so that commissions are not and cannot be legally
defined as regular in nature.
Regional Director Luna C. Piezas issued an Order directing Boie-Takeda to
pay its medical representatives and its managers the underpayment of
thirteenth (13th) month pay for the years 1986, 1987, 1988.
A similar Routine Inspection was conducted in the premises of Philippine Fuji
Xerox Corp. where it was found there was was underpayment of 13 month pay
since commissions were not included. In their almost identical-worded
petitioner, petitioners, though common counsel, attribute grave abuse of
discretion to respondent labor officials Hon. Dionisio Dela Serna and
Undersecretary Cresencio B. Trajano.
Issue: WON commissions are included in the computation of 13-month pay.
Held: No. The concept of 13th Month Pay as envisioned, defined and
implemented under P.D. 851 remained unaltered, and while entitlement to said
benefit was no longer limited to employees receiving a monthly basic salary of
not more than P1,000.00, said benefit was, and still is, to be computed on the
basic salary of the employee-recipient as provided under P.D. 851. Thus, the
interpretation given to the term "basic salary" as defined in P.D. 851 applies
equally to "basic salary" under Memorandum Order No. 28.
The term "basic salary" is to be understood in its common, generally-accepted
meaning, i.e., as a rate of pay for a standard work period exclusive of such
additional payments as bonuses and overtime.
In remunerative schemes consisting of a fixed or guaranteed wage plus
commission, the fixed or guaranteed wage is patently the "basic salary" for this
is what the employee receives for a standard work period. Commissions are
given for extra efforts exerted in consummating sales or other related
transactions. They are, as such, additional pay, which this Court has made
clear do not form part of the "basic salary."
29.) JACKSON BUILDING CONDOMINIUM CORPORATION and/or RAZUL
REQUESTO vs. NATIONAL LABOR RELATIONS COMMISSION and
FERDINAND GUMOGDA (G.R. No. 111515 July 14, 1995)
FACTS: The private respondent in this case was employed by the petitioner
company as a janitor. On November 15, 1992, private respondent filed a 45-
day leave of absence from November 15, 1991 to December 29, 1991 to
undergo an appendectomy (which would necessitate complete bed rest for
about thirty days from the date of operation as shown by his medical
certificate) and was subsequently granted by the petitioner. On January 3,
1992, private respondent informed petitioner Razul Requesto, president of
petitioner corporation, that he was physically fit to assume his work. However,
petitioners refused to accept him back contending that he had abandoned his
work. The private respondent filed with the Labor Arbiter a complaint against
petitioners for illegal dismissal, underpayment of wages and non-payment of
thirteenth-month pay and service-incentive leave pay. Petitioner opposed the
same, wherein they alleged that private respondent was not dismissed but was
merely advised to rest for health reasons until he could procure a medical
certificate attesting that he was fit to work. They further alleged that private
respondent failed to return to his workplace or to submit the required medical
certificate. On October 30, 1992, the Labor Arbiter rendered a decision in favor
of private respondent. Petitioners appealed to NLRC, but the same was
affirmed by said agency, thus, the filling of this case.
ISSUE: (1) Whether private respondent abandoned his work; and (2) whether
petitioners are liable for the payment of private respondent's back wages,
differential pay, thirteenth-month pay and service-incentive leave pay for 1991.
HELD: (1) The Court said that in order for abandonment to be a valid ground
for dismissal, two requisites must be compresent: the intention by an
employee to abandon coupled with an overt act from which it may be inferred
that the employee had no more intention to resume his work. Which is not both
present in this case. As found by the Labor Arbiter, private respondent's
physician advised him to rest for 30 days before reporting back for work in
order to recuperate. Private respondent heeded this advise and even
exceeded the number of days recommended by his doctor for his
recuperation. In fact, he reported back for work 50 days after his operation.
This would clearly show that private respondent was ready to assume his
responsibilities after having fully recovered from the operation.
(2) Yes, private respondent is entitled to the same. Section 31 of R.A. No.
6715 which amended Article 279 of the Labor Code of the Philippines provides
that "an employee who is unjustly dismissed from work shall be entitled to
reinstatement without loss of seniority rights and other privileges without loss
of seniority rights and other privileges and to his full back wages, inclusive of
allowances, and to his other benefits or their monetary equivalent computed
from the time his compensation was withheld from him up to the time of his
actual reinstatement.". The award of back wages by NLRC to private
respondent was predicated on the ground that he was illegally dismissed and
not on his failure to report for work. Private respondent is likewise entitled to
the thirteenth-month pay. Presidential Decree No. 851, as amended by
Memorandum Order No. 28, provides that employees are entitled to the
thirteenth-month pay benefit regardless of their designation and irrespective
of the method by which their wages are paid.
30.) VIRGINIA G. NERI and JOSE CABELIN vs. NATIONAL LABOR
RELATIONS COMMISSION FAR EAST BANK & TRUST COMPANY
(FEBTC) and BUILDING CARE CORPORATION (G.R. Nos. 97008-09 July
23, 1993)
FACTS: Petitioners instituted complaints against FEBTC and BCC to compel
the bank to accept them as regular employees and for it to pay the differential
between the wages being paid them by BCC and those received by FEBTC
employees with similar length of service. They contended that BCC in
engaged in labor-only contracting because it failed to adduce evidence
purporting to show that it invested in the form of tools, equipment, machineries,
work premises and other materials which are necessary in the conduct of its
business. Moreover, petitioners argue that they perform duties which are
directly related to the principal business or operation of FEBTC.
ISSUE: Whether or not BCC was engaged in labor-only contracting.
HELD: It is well-settled that there is labor-only contracting where: (a) the
person supplying workers to an employer does not have substantial capital or
investment in the form of tools, equipment, machineries, work premises,
among others; and, (b) the workers recruited and placed by such person are
performing activities which are directly related to the principal business of the
employer. BCC need not prove that it made investments in the form of tools,
equipment, machineries, work premises, among others, because it has
established that it has sufficient capitalization. This fact was both determined
by the Labor Arbiter and the NLRC as BCC had a capital of Php 1million fully
subscribed and paid for. BCC is therefore a highly capitalized venture and cannot
be deemed engaged in labor-only contracting. While there may be no
evidence that it has investment in the form of tools, equipment, machineries,
work premises, among others, it is enough that it has substantial capital, as
was established before the Labor Arbiter as well as the NLRC. The law does
not require both substantial capital and investment in the form of tools,
equipment, machineries, etc. This is clear from the use of the conjunction "or"
instead of and. Having established that it has substantial capital, it was no
longer necessary for BCC to further adduce evidence to prove that it does not
fall within the purview of "labor-only" contracting. There is even no need for
it to refute petitioners' contention that the activities they perform are directly
related to the principal business of respondent bank. On the other hand,
the Court has already taken judicial notice of the general practice adopted in
several government and private institutions and industries of hiring
independent contractors to perform special services. These services range
from janitorial, security and even technical or other specific services such as
those performed by petitioners Neri and Cabelin. While these services may be
considered directly related to the principal business of the employer,
nevertheless, they are not necessary in the conduct of the principal business
of the employer.
31.) PILIPINAS SHELL PETROLEUM CORPORATION vs. THE
HONORABLE COURT OF APPEALS and CLARITA T. CAMACHO (G.R.
No. 104658. April 7, 1993)
FACTS: Clarita T. Camacho, the operator of a gasoline station in Baguio City
wherein she sells Pilipinas Shell Petroleum Corp.s (Shell) petroleum products,
requested Shell to conduct a hydro-pressure test on the underground storage
tanks of the said station in order to determine whether or not the sales losses
she was incurring for the past several months were due to leakages therein.
Shell acceded to the said request and one Jesus Jessie Feliciano together
with other workers came to Clarita's station with a Job Order from Shell to
perform the hydro-pressure test. Jessie conducted the necessary procedures
to carry out the said test.
At around 5:30 a.m. the next day, Claritas husband opened the station and
started selling gasoline. At about 6:00 a.m. however, the customers who had
bought gasoline returned to the station complaining that their vehicles stalled
because there was water in the gasoline that they bought. On account of this,
Clarita was constrained to replace the gasoline sold to the said customers.
However, a certain Eduardo Villanueva, one of the customers, filed a
complaint with the police against Camacho for selling the adulterated gasoline.
In addition, he caused the incident to be published in two local newspapers.
Shell undertook to settle the criminal complaint filed by Villanueva.
Subsequently, Villanueva filed an Affidavit of Desistance. Thereafter,
Camacho filed before the trial court a complaint for damages against Shell due
to the latters alleged negligence in the conduct of the hydropressure test in
her gasoline station. For its part, Shell denied liability because, according to it,
the hydro-pressure test on the underground storage tanks was conducted by
an independent contractor. The trial court dismissed the complaint which ruling
was reversed by the Court of Appeals.
ISSUE: Whether Shell should be held accountable for the damage to
Camacho due to the hydro-pressure test conducted by Feliciano
HELD: It is a well-entrenched rule that an employer-employee relationship
must exist before an employer may be held liable for the negligence of his
employee. Respondent Court of Appeals coneluded that Feliciano was not an
independent contractor but was under the control and supervision of petitioner
in the performance of the hydro-pressure test, hence, it held petitioner liable
for the formers acts and omissions. We are not in accord with the above
finding of respondent Court of Appeals. As aptly held by the trial court,
petitioner did not exercise control and supervision over Feliciano with regard
to the manner in which he conducted the hydro-pressure test.
Feliciano is independently maintaining a business under a duly registered
business name JFS Repair and Maintenance Service, and is duly registered
with the Bureau of Domestic Trade. He does not enjoy a fixed salary but
instead charges a lump sum consideration for every piece of work he
accomplishes. If he is not able to finish his work, he does not get paid, as what
happened in this case. Further, Feliciano utilizes his own tools and equipment
and has a complement of workers. Neither is he required to work on a regular
basis. Instead, he merely awaits calls from clients such as petitioner whenever
repairs and maintenance services are requested. Moreover, Feliciano does
not exclusively service petitioner because he can accept other business but
not from other oil companies. All these are the hallmarks of an independent
contractor. Being an independent contractor, Feliciano is responsible for his
own acts and omissions. As he alone was in control over the manner of how
he was to undertake the hydro-pressure test, he alone must bear the
consequences of his negligence, if any, in the conduct of the same.
Anent the issue of damages, the same has been rendered moot by the failure
of private respondent to establish an employer-employee relationship between
petitioner and Feliciano. Absent said relationship, petitioner cannot be held
liable for the acts and omissions of the independent contractor, Feliciano.
32.) DEVELOPMENT BANK OF THE PHILIPPINES vs.
THE NATIONAL LABOR RELATIONS COMMISSION, ONG PENG, ET. AL.,
(G.R. Nos. 100264-81 January 29, 1993)
FACTS: On November 14, 1986, the private respondents filed with the
Provincial Extension Office of the Department of Labor and Employment
(DOLE) in Daet, Camarines Norte seventeen individual complaints against
RHI for unpaid wages and separation pay. These complaints were thereafter
endorsed to the Regional Arbitration Branch (Branch V of Legaspi City) of the
National Labor Relations Commission (NLRC) since the petitioners had
already been terminated from employment. In its position paper dated March
1987, RHI alleged that it had ceased to operate in 1983 due to the government
ban against tree-cutting. It further alleged that in May 24, 1981, its sawmill was
totally burned resulting in enormous losses and that due to its financial
setbacks, RHI failed to pay its loan with the DBP. RHI contended that since
DBP foreclosed its mortgaged assets on September 24, l985, then any
adjudication of monetary claims in favor of its former employees must be
satisfied against DBP. On October 28, 1988, Executive Labor Arbiter Gelacio
Rivera rendered a joint decision on the complaints in favor of the private
respondents. DBP appealed to the NLRC which rendered a decision on April
15, 1991 affirming the labor arbiter's judgment. DBP filed a motion for
reconsideration which was likewise dismissed by the NLRC on May 17, 1991.
ISSUE: Whether or not Executive Labor Arbiter Gelacio L. Rivera and the
NLRC correctly applied Article 110 of the Labor Code in this case.
HELD: Article 110, prior to its amendment by Republic Act No. 6715, reads:
Art. 110. Worker preference in case of bankruptcy. In
the event of bankruptcy or liquidation of an employer's
business, his workers shall enjoy first preference as
regards wages due them for services rendered during
the period prior to the bankruptcy or liquidation, any
provision of law to the contrary notwithstanding. Unpaid
wages shall be paid in full before other creditors may
establish any claim to a share in the assets of the
employer.
Section 10, Rule VIII, Book III of the Implementing Rules and Regulations of
the Labor Code states:
Sec. 10. Payment of wages in case of bankruptcy.
Unpaid wages earned by the employees before the
declaration of bankruptcy or judicial liquidation of the
employer's business shall be given first preference and
shall be paid in full before other creditors may establish
any claim to a share in the assets of the employer.
In Republic v. Peralta, 150 SCRA 37 (1987), the Court held that the term
"wages" includes separation pay. But the Court declared:
Article 110 of the Labor Code, in determining the reach
of its terms, cannot be viewed in isolation. Rather,
Article 110 must be read in relation to the provisions of
the Civil Code concerning the classification,
concurrence and preference of credits, which provisions
find particular application in insolvency proceedings
where the claims of all creditors, preferred or non-
preferred, may be adjudicated in a binding manner.
We have repeatedly stressed that before the workers' preference provided by
Article 110 may be invoked, there must first be a declaration of bankruptcy or
a judicial liquidation of the employer's business.
The NLRC, therefore, committed grave abuse of discretion when it affirmed
the labor arbiter's ruling that the workers' preference espoused in Article 110
may be applied even in the absence of a declaration of bankruptcy or a
liquidation order.
33.) DEVELOPMENT BANK OF THE PHILIPPINES
vs. NLRC and NATIONAL MINES AND ALLIED WORKERS UNION (G.R.
No. 97175 May 18, 1993)
FACTS: Private respondent labor union filed on January 10, 1986, a
complaint, which alleges that they were all employees of respondent Midland
Cement Corporation who were terminated from employment on or about July
30, 1981 by reason of the termination of the business operations of the
Construction and Development Corporation of the Philippines (CDCP) now
PNCC, which was brought about by the expiration of the lease contract
between Midland Cement Corporation and CDCP. After hearing, the Labor
Arbiter rendered a decision on January 5, 1990, finding DBP jointly and
severally liable with Midland Cement for the payment of the separation pay.
DBP appealed, contending that its acquisition of the mortgaged assets of
Midland through foreclosure sale did not make it the owner of the defunct
Midland Cement, and that the doctrine of successor-employee is not
applicable in this case, since DBP did not continue the business operations of
Midland. The NLRC, while finding merit in DBP's contention, nonetheless held
DBP liable since respondent's claim "constitutes a first preference with respect
to the proceeds of the foreclosure sale" as provided in Article 110 of the Labor
Code. Following the denial of its motion for reconsideration, DBP filed the
instant petition.
ISSUE: Whether or not NLRC erred in holding DBP liable "to the extent of the
proceeds of the foreclosure sale.
HELD: The Court held in the affirmative. DBP correctly points out that its
mortgage lien should not be classified as a preferred credit. The issue raised
was settled in Republic v. Peralta and reinforced in DBP v. NLRC wherein we
held because of its impact on the entire system of credit, Article 110 of the
Labor Code cannot be viewed in isolation but must be read in relation to the
Civil Code scheme on classification and preference of credits. Making such
liability dependent on a bankruptcy or liquidation proceedings is really beside
the point, for these proceedings are relevant only to preferred credits, which is
not the situation in the case at bar. To equate DBP's mortgage lien with a
preferred credit would be to render inutile the protective mantle of the
mortgage in DBP's favor and thus in the process wreak havoc to commercial
transactions.
34.) REPUBLIC OF THE PHILIPPINES, represented by the Bureau of
Customs and the Bureau of Internal Revenue vs. HONORABLE E.L.
PERALTA, PRESIDING JUDGE OF THE COURT OF FIRST INSTANCE
OF MANILA, BRANCH XVII, QUALITY TABACCO CORPORATION,
FRANCISCO, FEDERACION OBRERO DE LA INDUSTRIA TABAQUERA
Y OTROS TRABAJADORES DE FILIPINAS (FOITAF) USTC EMPLOYEES
ASSOCIATION WORKERS UNION-PTGWO (G.R. No. L-56568 May 20,
1987)
FACTS: The Republic of the Philippines seeks the review on certiorari of the
Order of the CFI of Manila in its Civil Case No. 108395 entitled "In the Matter
of Voluntary Insolvency of Quality Tobacco Corporation, Quality Tobacco.-
In its questioned Order, the trial court held that the above enumerated claims
of USTC and FOITAF (hereafter collectively referred to as the "Unions") for
separation pay of their respective members embodied in final awards of the
NLRC were to be preferred over the claims of the Bureau of Customs and
the BIR. The trial court, in so ruling, relied primarily upon Article110 of the
Labor Code.- The Solicitor General, in seeking the reversal of the questioned
Orders, argues that Article 110 of the Labor Code is not applicable as it
speaks of "wages," a term which he asserts does not include the separation
pay claimed by the Unions. "Separation pay," the Solicitor General contends:
is given to a laborer for a separation from employment computed on the
basis of the number of years the laborer was employed by the employer; it is
a form of penalty or damage against the employer in favor of the employee
for the latter's dismissal or separation from service
ISSUE: Whether or not separation pay of their respective members
embodied in final awards of the NLRC were to be preferred over the claims
of the Bureau of Customs and the BIR.
HELD: Yes. For the specific purposes of Article 110 and in the context of
insolvency termination or separation pay is reasonably regarded as forming
part of the remuneration or other money benefits accruing to employees or
workers by reason of their having previously rendered services to their
employer; as such, they fall within the scope of "remuneration or earnings
for services rendered or to be rendered ." Liability for separation pay
might indeed have the effect of a penalty, so far as the employer is
concerned. So far as concerns the employees, however, separation pay is
additional remuneration to which they become entitled because, having
previously rendered services, they are separated from the employer's
service.
35.) ATTY. WILFREDO TAGANAS vs. NATIONAL LABOR RELATIONS
COMMISSION, MELCHOR ESCULTURA, ET AL. (G.R. No. 118746
September 7, 1995)
FACTS: Taganas is a lawyer for several janitors under the employ of Ultra
Clean Services and Philippine Tuberculosis Society, Inc. There was a labor
dispute between the said janitors and their employers. Taganas defended the
janitors in the civil case for reinstatement, full back wages, thirteenth month
pay and emergency cost of living allowance. Taganas and his clients won the
case and so Taganas sought to enforce his attorneys charging lien which
amounted to 50% of the amount awarded to his clients. The 10 out of the 14
clients were aggrieved for receiving a reduced award due to the attorneys
charging lien and contested the validity of the contingent fee. The four others
agreed to the original amount.
ISSUE: Whether or not Taganas contingent fee of 50% of the award to his
clients is excessive.
HELD: A contingent fee arrangement is an agreement between the lawyer and
his client in which the lawyers professional fee, usually a fixed percentage of
what may be recovered in the action is made to depend upon the success of
the litigation. It should be noted however that Section 13 of the Canons of
Professional Ethics states that a contract for a contingent fee where
sanctioned by law, should be reasonable under all circumstances of the case
including the risk and uncertainty of the compensation, but should always be
the subject to the supervision of the court, as to its reasonableness. The
reduction of unreasonable attorneys fees is within the regulatory powers of
the courts. 50% of the judgment award as attorneys fees is excessive and
unreasonable considering the financial capacity and economic status of
Taganass clients. Also, petitioners contingent fee falls within Article 111 of
the Labor Code which puts a maximum 10% contingent fee for attorneys in
labor cases. The decision of the NLRC to disallow the 50% contingent fee is
upheld, only 10% should be paid to Tagarnas.
36.) ERNESTO M. APODACA vs. NATIONAL LABOR RELATIONS
COMMISSION, JOSE M. MIRASOL and INTRANS PHILS., INC. (G.R. No.
80039 April 18, 1989)
FACTS: Petitioner was employed in respondent corporation. He was
persuaded by respondent Mirasol to subscribe to 1,5000 shares or a total of
Php150,000.00. He paid Php37,500.00. On September 1, 1975, petitioner was
appointed President and General Manager of the respondent corporation.
However, on January 2, 1986, he resigned. Petitioner instituted with the NLRC
a complaint against private respondents for the payment of his unpaid wages,
his cost of living, allowance, the balance of his gasoline and the representation
expenses and his bonus compensation for 1986. Private respondents
admitted that there is due to petitioner the amount of Php17,060.07 but this
was applied to the unpaid balance of his subscription in the amount
Php95,439.93. petitioner questioned the set-off alleging that there was no call
or notice for the payment of the unpaid subscription and that, accordingly, the
alleged obligation is not enforceable.
ISSUE: (1) Whether or not NLRC has jurisdiction to resolve a claim for non-
payment of stock subscriptions to a corporation. (2) If so, whether or not an
obligation arising therefrom be offset against a money claim of an employee
against the wmployer.
HELD: (1) NLRC has no jurisdiction to determine such intra-corporate dispute
between the stockholder and the corporation in the matter of unpaid
subscriptions. This controversy is within the exclusive jurisdiction of the
Securities and Exchange Commission.
(2) No, the unpaid subscription are not due and payable until a call is made by
the corporation for payment. Private respondents have not presented a
resolution of the board of directors of respondent corporation calling for the
payment of the unpaid subscriptions. It does not even appear that a notice or
a call for the payment of unpaid subscriptions, the same is not yet due and
payable. Even if there was a call for payment, the NLRC cannot validly set it
off against the wages and other benefits due petitioner. Article 113 of the Labor
Code allows such deduction from the wages of the employees by the
employer, only in 3 instances.
37.) SERVANDO'S INCORPORATED vs. THE SECRETARY OF LABOR
AND EMPLOYMENT AND THE REGIONAL DIRECTOR, REGION VI,
DEPARTMENT OF LABOR AND EMPLOYMENT (G.R. No. 85840 April 26,
1990)
FACTS:
The Labor Standards and Welfare Office conducted a routine inspection of
petitioners establishment and discovered that there were deficiency in the
wages of 54 employees pursuant to 3 Wage Orders. Adopting the
recommendation made by the Labor Standards and Welfare Office, the
Regional Director issued an order requiring petitioner to pay its employees
the total amount of P964.952.50 as differentials.
ISSUE:
Whether or not the Regional Director has the jurisdiction to hear and decide
cases involving recovery of wages and other monetary claims and benefits of
workers and employees.
HELD:
The power of the Regional Director to adjudicate employees money claims
is subject to the concurrence of all the requisites provided under Sec. 2 of
RA 6715, to wit: (1) the claim is presented by an employee or person
employed in domestic or household service, or househelper; (2) the claim
arises from employer-employee relations;
(3) the claimant does not seek reinstatement;
and (4) the aggregate money claim of each employee or househelper does
not exceed P5,000.00.
In the case at bar, the Regional Director has no jurisdiction over the case.
The aggregate claims of each of the fifty four (54) employees of herein
petitioner are over and above the amount of P5,000.00. Under the
circumstances, the power to adjudicate such claims belongs to the Labor
Arbiter who has the exclusive jurisdiction over employees claims where the
aggregate amount of the claim for each employee exceeds P5,000.00.
38.) BROKENSHIRE MEMORIAL HOSPITAL, INC. vs. THE HONORABLE
MINISTER OF LABOR & EMPLOYMENT AND BROKENSHIRE MEMORIAL
HOSPITAL EMPLOYEES AND WORKER'S UNION-FFW Represented by
EDUARDO A. AFUAN (G.R. No. 74621 February 7, 1990)
FACTS: This case originated from a complaint filed by private respondents
against petitioner on September 21, 1984 with the Regional Office of the
MOLE, Region XI, Davao City for non-compliance with the provisions of Wage
Order No. 5. After due healing the Regional Director rendered a decision dated
November 16, 1984 in favor of private respondents. Judgment having become
final and executory, the Regional Director issued a Writ of Execution whereby
some movable properties of the hospital (petitioner herein) were levied upon
and its operating expenses kept with the bank were garnished. The levy and
garnishment were lifted when petitioner hospital paid the claim of the private
respondents (281 hospital employees) directly, in the total amount of
P163,047.50 covering the period from June 16 to October 15, 1984. After
making said payment, petitioner hospital failed to continue to comply with
Wage Order No. 5 and likewise, failed to comply with the new Wage Order No.
6 which took effect on November 1, 1984, prompting private respondents to
file against petitioner another complaint docketed as ROXILSED-14-85, which
is now the case at bar.
ISSUE: Whether or not the Regional Director has jurisdiction over money
claims of workers concurrent with the Labor Arbiter.
HELD: It will be observed that what in fact conferred upon Regional Directors
and other hearing officers of the Department of Labor (aside from the Labor
Arbiters) adjudicative powers, i.e., the power to try and decide, or hear and
determine any claim brought before them for recovery of wages, simple money
claims, and other benefits, is Republic Act 6715, provided that the following
requisites concur, to wit: 1) The claim is presented by an employee or person
employed in domestic or household service, or househelper under the code;
2) The claimant, no longer being employed, does not seek reinstatement; and
3) The aggregate money claim of the employee or househelper does not
exceed five thousand pesos (P5,000.00). In the absence of any of the three
(3) requisites, the Labor Arbiters have exclusive original jurisdiction over all
claims arising from employer-employee relations, other than claims for
employee's compensation, social security, medicare and maternity benefits.
Petitioner's contention that the constitutionality of Wage Order Nos. 5 and 6
should be passed upon by the NLRC, lacks merit. The Supreme Court is
vested by the Constitution with the power to ultimately declare a law
unconstitutional. Without such declaration, the assailed legislation remains
operative and can be the source of rights and duties especially so in the case
at bar when petitioner complied with Wage Order No. 5 by paying the
claimants the total amount of P163,047.50, representing the latter's minimum
wage increases up to October 16, 1984, instead of questioning immediately at
that stage before paying the amount due, the validity of the order on grounds
of constitutionality. The Regional Director is plainly, without the authority to
declare an order or law unconstitutional and his duty is merely to enforce the
law which stands valid, unless otherwise declared by this Tribunal to be
unconstitutional. The labor regulations officers may not be deemed
uncontested as to bring the case at bar within the competence of the Regional
Director, as duly authorized representative of the Secretary of Labor, pursuant
to Article 128 of the Labor Code, as amended. Considering further that the
aggregate claims involve an amount in excess of P5,000.00, We find it more
appropriate that the issue of petitioner hospital's liability therefor, including the
proposal of petitioner that the obligation of private respondents to the former
in the aggregate amount of P507,237.57 be used to offset its obligations to
them, be ventilated and resolved, not in a summary proceeding before the
Regional Director under Article 128 of the Labor Code, as amended, but in
accordance With the more formal and extensive proceeding before the Labor
Arbiter. Nevertheless, it should be emphasized that the amount of the
employer's liability is not quite a factor in determining the jurisdiction of the
Regional Director. However, the power to order compliance with labor
standards provisions may not be exercised where the employer contends or
questions the findings of the labor regulation officers and raises issues which
cannot be determined without taking into account evidentiary matters not
verifiable in the normal course of inspection, as in the case at bar. The instant
case falls under the exclusive original jurisdiction of the Labor Arbiter RA 6715
is in the nature of a curative statute. Curative statutes have long been
considered valid in our jurisdiction, as long as they do not affect vested rights.
In this case, the court did not see any vested right that will be impaired by the
application of RA 6715.
39.) VERONICA B. REYES vs. NATIONAL LABOR RELATIONS
COMMISSION and KONG HUA SCHOOL (G.R. No. 78997 August 31, 1989)
FACTS: Petitioner started teaching in the respondent school in August 1972.
She went on maternity leave effective August 26 up to October 10, 1982. In
view of complications resulting from the delivery of her child, she asked for a
leave extension and filed an application for indefinite leave of absence until
such time as she would be ready to report for work. On December 21, 1982,
she reported for work but was able to teach for only one day because she
suffered a nervous breakdown. After the Christmas vacation, she again filed
an application for an indefinite leave of absence because of poor health but
this was disapproved by the school. On September 13, 1983, upon the advice
of the school principal, she submitted a letter to get her two months vacation
salary and to tender her resignation on the promise that she would be given
priority for re-employment. Two weeks later, she sent her husband to the
school to claim her vacation pay. Petitioner was then and there paid her two
months vacation pay by the school.
When the school opened in June 1985, the petitioner, who had in the
meantime fully regained her health, applied for reinstatement, but the school
refused to re-hire her. Feeling aggrieved, she filed a complaint for
reinstatement, backwages and other benefits with the NLRC in Cagayan de
Oro City. The labor arbiter treated her complaint as a claim for separation pay
and dismissed it for lack of merit.
Aggrieved by the decision of the Labor Arbiter, petitioner appealed to the
NLRC on the sole ground that the labor arbiter erred in holding that her
resignation was voluntary.
On April 6, 1987, the NLRC dismissed the appeal holding that since the
petitioner had voluntarily resigned from her teaching position and thereby
severed the employer-employee relationship, she is not entitled to any
separation pay.
ISSUE: Whether or not respondent NLRC committed a grave abuse of
discretion.
HELD: The respondent NLRC committed a grave abuse of discretion when it
disregarded facts in the records proving that the petitioner's supposed
"resignation" was involuntary, that it was in fact procured by her employer on
the promise that she would be given priority for re-employment and in
consideration of immediately paying her two months vacation which she
desperately needed then because she was ill. Article 133(b) of the Labor Code
provides:
ART. 133(b). The maternity leave shall be extended
without pay on account of illness medically certified to
arise out of the pregnancy, delivery, abortion, or
miscarriage, which renders the woman unfit for work,
unless she has earned unused leave credits from which
such extended leave may be charged.
To extricate itself from its promise to re-hire her, the school made her husband
sign in her behalf an unconditional letter of resignation when he went to the
school to collect his wife's vacation pay. That letter is not binding on the
petitioner for there is no proof that she authorized her husband to write it for
her and to waive her right to be re-hired as promised by the school or to
abandon her right to separation pay if she would not be reinstated. The schools
refusal in bad faith to re-employ her despite its promise to do so, amounted to
illegal dismissal. Consequently, she is entitled to be reinstated with three years
backwages.
40.) CLAUDINE DE CASTRO ZIALCITA, et. al. vs. PHILIPPINE AIRLINES
(RO4-3-3398-76 February 20, 1977)
FACTS: Complainant Zialcita, an international flight stewardess of PAL, was
discharged from the service on account of her marriage. In discharging
Zialcita, PAL invoked its policy that flight attendants must be single, and shall
be automatically separated from employment in the event that they
subsequently get married. They claimed that this policy was in accordance
with Article 132 of the Labor Code. On the other hand, Zialcita questioned her
termination on account of her marriage, invoking Article 136 of the same law.
ISSUE: Whether or not Zialcita was validly terminated on account of her
marriage.
FACTS: Private respondent Candido was employed by petitioner Apex mining
Co., Inc. to perform laundry services at its staff house. On December 18, 1987,
while she was attending to her assigned task and she was hanging her
laundry, she accidentally slipped and hit her back on a stone. As a result of
the accident she was not able to continue with her work. She was permitted to
go on leave for medication. Dela Rosa (her immediate supervisor) offered her
the amount of Php2,000.00 which was eventually increased to Php5,000.00 to
persuade her to quit her job, but she refused the offer and preferred to return
to work. Petitioner did not allow her to return to work and dismissed her on
February 4, 1988, Private respondent filed a request for assistance with the
DOLE, which the latter rendered its Decision by ordering Apex Mining to pay
Candido the total amount of Php55,161.42 for salary differential, emergency
living allowance, 13th month differential and separation pay. Petitioner
appealed before the NLRC, which was subsequently dismissed for lack of
merit.
ISSUE: Whether or not private respondent should be treated as househelper
or domestic servant or a regular employee.
HELD: Under Rule XIII, Section 1(b), Book 3 of the Labor Code, as amended,
the term househelper as used herein is synonymous to the term domestic
servant and shall refer to any person, whether male or female, who renders
services in and about the employers home and which services are usually
necessary or desirable for the maintenance and enjoyment thereof, and
ministers exclusively to the personal comfort and enjoyment of employers
family. The definition cannot be interpreted to include househelper or
laundrywomen working on staff houses of a company, like private respondent
who attends to the needs of the companys guest and other persons availing
of said facilities. The mere fact that househelper or domestic servant is working
within the premises of the business of the employer and in relation to or in
connection with its staff houses for its guest or even for its officers and
employees, warrants the conclusion that such househelper or domestic
servant is and should be considered as a regular employee.
42.) ZAMORA vs. SY (CA decision) 52 Official Gazette 1513
xxx The issue is whether the phrase "medical attendance", as used in this
provision, includes "expenses of hospitalization." The question is one of first
impression in this jurisdiction, although the Court of Appeals has decided it
in the negative in Zamora v. Sy, 52 Off. Gaz., 1513.xxx (G.R. No. L-16298
September 29, 1962, ESTEBAN CUAJAO vs. CHUA LO TAN, ET AL)

HELD: The Court held on the negative. When Presidential Decree No. 148,
otherwise known as the Women and Child Labor Law, was promulgated on
March 133, 1973, PALs policy had met its doom. However, since no one
challenged its validity, the said policy was able to obtain a momentary reprieve.
Section 8 of PD 148 is exactly the same as provision produced verbatim in
Article 136 of the Labor Code, which was promulgated on May 1, 1974 and
took effect 6 months later. Although Article 1132 enjoins the Sec. of Labor to
establish standards that will ensure the safety and health of women employees
and in appropriate cases shall by regulation require employers to determine
appropriated minimum standards for termination in special occupations, such
as those flight attendants, it is logical to presume that, in the absence of said
standards or regulations which are yet to be established, the policy of PAL
against marriage is patently illegal.
Art. 136 is not meant to apply only to women employed in ordinary
occupations, or it should have categorically expressed so. The sweeping
intendment of the law, be it on ordinary occupations, is reflected in the whole
text and supported by Art. 135 that speaks of non-discrimination on the
employment of women.

41.) APEX MINING COMPANY, INC. vs. NATIONAL LABOR RELATIONS

COMMISSION and SINCLITICA CANDIDO (G.R. No. 94951 April 22, 1991)