Reasonable Causal Connection Rule

Portillo vs. Rudolf Lietz, Inc. et al., G.R. No. 196539, October 10, 2012 Doctrine:
The "reasonable causal connection with the employer-employee relationship" is a requirement not only in employees' money claims against the
employer but is, likewise, a condition when the claimant is the employer.
Facts:
Marietta Portillo (Portillo) was promoted to Sales Representative and received a corresponding increase in basic monthly salary sales and sales
quota on her 10th year with Lietz, Inc. In this regard, Portillo
signed another letter agreement containing a “Goodwill Clause.”

Three years thereafter, Portillo resigned from her employment and demanded from Lietz Inc. for the payment of her remaining salaries and
commissions not paid to her upon such resignation. Later, within the 3-year prohibitory period, Lietz learned that Portillo was hired by Ed Keller
Philippines, a direct competitor of Lietz, as head of its Pharma Raw Material Department. Portillo's demands from Lietz, Inc. for the payment of
her remaining salaries and commissions went unheeded. Lietz, Inc. gave Portillo the run around, on the pretext that her salaries and commissions
were still being computed. She filed a complaint with the NLRC for non-
payment of 1½ months’ salary, 2 months’ commission, 13th month pay, plus moral, exemplary and actual damages and attorney’s fees.

In its position paper, Lietz admitted liability for Portillo’s money claims. However, Lietz raised the defense of legal compensation, stating that
Portillo’s money claims should
be offset against her liability to Lietz for
liquidated damages for Portillo’s breach of the “Goodwill Clause” in the employment contract when she
became employed with Ed Keller.
Issue:
Should Portillo’s money claims for unpaid salaries be offset against Lietz’ claim for liquidated
damages?
Ruling:
No. There is no causal connection between the petitioner employees' claim for unpaid wages and the respondent employers' claim for damages for
the alleged "Goodwill Clause" violation. Portillo's claim for unpaid salaries did not have anything to do with her alleged violation of the employment
contract as, in fact, her separation from employment is not "rooted" in the alleged contractual violation. She resigned from her employment. She
was not dismissed. Portillo's entitlement to the unpaid salaries is not even contested. Indeed, Lietz, Inc.'s argument about legal compensation
necessarily admits that it owes the money claimed by Portillo. The alleged contractual violation did not arise during the existence of the employer-
employee relationship. It was a post-employment matter, a post-employment violation.

PEPSI-COLA BOTTLING COMPANY v. JUDGE ANTONIO M. MARTINEZ +

DECISION

ESCOLIN, J.:

This petition for certiorari, prohibition and mandamus raises anew the legal question often brought to this Court: Which tribunal
has exclusive jurisdiction over an action filed by an employee against his employer for recovery of unpaid salaries, separation benefits
and damages - the court of general jurisdiction or the Labor Arbiter of the National Labor Relations Commission [NLRC]?
The facts that gave rise to this petition are as follows:

On September 19, 1980, respondent Abraham Tumala, Jr. filed a complaint in the Court of First Instance of Davao, docketed as Civil
Case No. 13494, against petitioners Pepsi-Cola Bottling Co., Inc., its president Cosme de Aboitiz and other company officers. Under
the first cause of action, the complaint averred inter alia that Tumala was a salesman of the company in Davao City from 1977 up to
August 21, 1980; that in the annual "Sumakwel" contest conducted by the company in 1979, Tumala was declared winner of the "Lapu-
Lapu Award" for his performance as top salesman of the year, an award which entitled him to a prize of a house and lot; and that
petitioners, despite demands, have unjustly refused to deliver said prize. Under the second cause of action, it was alleged that on
August 21, 1980, petitioners, "in a manner oppressive to labor" and "without prior clearance from the Ministry of Labor," "arbitrarily
and illegally" terminated his employment. He prayed that petitioners be ordered, jointly and severally, to deliver his prize of house
and lot or its cash equivalent, and to pay his back salaries and separation benefits, plus moral and exemplary damages, attorney's fees
and litigation expenses. He did not ask for reinstatement.

Petitioners moved to dismiss the complaint on grounds of lack of jurisdiction and cause of action. Petitioners further alleged that
Tumala was not entitled to the "Sumakwel" prize for having misled the company into declaring him top salesman for 1979 through
various deceitful and fraudulent manipulations and machinations in the performance of his duties as salesman and depot in-charge
of the bottling company in Davao City, which manipulations consisted of "unremitted cash collections, fictitious collections of trade
accounts, fictitious loaned empties, fictitious product deals, uncollected loaned empties, advance sales confirmed by marketing outlets
as undelivered, loaned empties confirmed as fictitious, and route shortages which resulted to the damage and prejudice of the bottling
company in the amount of P381,851.76." The alleged commission of these fraudulent acts was also advanced by petitioners to justify
Tumala's dismissal.
The court below, sustaining its jurisdiction over the case, denied the motion as well as the motion for reconsideration. Hence the
present recourse.

We rule that the Labor Arbiter has exclusive jurisdiction over the case.

Jurisdiction over the subject matter in a judicial proceeding is conferred by the sovereign authority which organizes the court; and it
is given only by law.[1]Jurisdiction is never presumed; it must be conferred by law in words that do not admit of doubt.[2]

Since the jurisdiction of courts and judicial tribunals is derived exclusively from the statutes of the forum, the issue before Us should
be resolved on the basis of the law or statute now in force. We find that law in Presidential Decree 1691 which took effect on May 1,
1980, Section 3 of which reads as follows:

"SEC. 3. Article 217, 222 and 262 of Book V of the Labor Code are hereby amended to read as follows:

"Article 217. Jurisdiction of Labor Arbiters and the Commission. - (a) The Labor Arbiters shall have the original and exclusive
jurisdiction to hear and decide the following cases involving all workers, whether agricultural or non-agricultural:

"1. Unfair labor practice cases;

"2. Unresolved issues in collective bargaining, including those that involve wages, hours of work and other terms and conditions of
employment;

"3. All money claims of workers, including those based on non-payment or underpayment of wages, overtime compensation,
separation pay and other benefits provided by law or appropriate agreement, except claims for employees' compensation, social
security, medicare and maternity benefits;

"4. Cases involving household services; and

"5. All other claims arising from employer-employee relations, unless expressly excluded by this Code."
Under paragraphs 3 and 5 of the above Presidential Decree, the case is exclusively cognizable by the Labor Arbiters of the National
Labor Relations Commission.

It is to be noted that P.D. 1691 is an exact reproduction of Article 217 of the Labor Code (P.D. 442), which took effect on May 1, 1974. In
Garcia vs. Martinez [3], an action filed on August 2, 1976 in the Court of First Instance of Davao by a dismissed employee against his
employer for actual, moral and exemplary damages, We held that under Article 217 of the Labor Code, the law then in force, the case
was within the exclusive jurisdiction of the Labor Arbiters and the National Labor Relations Commission [NLRC]. This Court, per
Justice Aquino, rationalized this holding thus:

"The provisions of paragraphs 3 and 5 of article 217 are broad and comprehensive enough to cover Velasco's [employee's] claim for
damages allegedly arising from his unjustified dismissal by Garcia [employer]. His claim was a consequence of the termination of
their employer-employee relations [Compare with Ruby Industrial Corporation vs. Court of First Instance of Manila, L-38893, August
31, 1977 , 78 SCRA 499]."
Article 217 of the Labor Code was amended by P.D. 1367, which was promulgated on May 1, 1978, the full text of which is quoted as
follows:

"SECTION 1. Paragraph [a] of Art. 217 of the Labor Code as amended is hereby further amended to read as follows:

"[a] The Labor Arbiters shall have exclusive jurisdiction to hear and decide the following cases involving all workers, whether agri-
cultural or non-agricultural:

'1] Unfair labor practice cases;

'2] Unresolved issues in collective bargaining, including those which involve wages, hours of work, and other terms conditions of
employment; and

'3] All other cases arising from employer-employee relations duly indorsed by the Regional Directors in accordance with the
provisions of this Code.'

"Provided, that the Regional Directors shall not indorse and Labor Arbiters shall not entertain claims for moral or other forms of
damages."
It will be noted that paragraphs 3 and 5 of Article 217 were deleted from the text of the above decree and a new provision incorporated
therein, to wit: "Provided that the Regional Directors shall not indorse and Labor Arbiters shall not entertain claims for moral or other
forms of damages." This amendatory act thus divested the Labor Arbiters of their competence to pass upon claims for damages by
employees against their employers.

However, on May 1, 1980, Article 217, as amended by P.D. 1367, was amended anew by P.D. 1691. This last decree, which is a verbatim
reproduction of the original text of Article 217 of the Labor Code, restored to the Labor Arbiters of the NLRC the exclusive jurisdiction
over claims, money or otherwise, arising from employer-employee relations, except those expressly excluded therefrom.

In sustaining its jurisdiction over the case at bar, the respondent court relied on Calderon vs. Court of Appeals [4], where We ruled that
an employee's action for unpaid salaries, allowances and other reimbursable expenses and damages was beyond the periphery of the
jurisdictional competence of the Labor Arbiters. Our ruling in Calderon, however, no longer applies to this case because P.D. 1367,
upon which said decision was based, had already been superceded by P.D. 1691. As heretofore stated, P.D. 1691 restored to the Labor
Arbiters their exclusive jurisdiction over said classes of claims.

Respondent Tumala maintains that his action for delivery of the house and lot, his prize as top salesman of the company for 1979, is a
civil controversy triable exclusively by the court of general jurisdiction. We do not share this view. The claim for said prize
unquestionably arose from an employer-employee relation and, therefore, falls within the coverage of par. 5 of P.D. 1691, which speaks
of "all claims arising from employer-employee relations, unless expressly excluded by this Code." Indeed, Tumala would not have
qualified for the contest, much less won the prize, if he was not an employee of the company at the time of the holding of the
contest. Besides, the cause advanced by petitioners to justify their refusal to deliver the prize - the alleged fraudulent manipulations
committed by Tumala in connection with his duties as salesman of the company - involves an inquiry into his actuations as an
employee.

Besides, to hold that Tumala's claim for the prize should be passed upon by the regular court of justice, independently and separately
from his claim for back salaries, retirement benefits and damages, would be to sanction split jurisdiction and multiplicity of suits which
are prejudicial to the orderly administration of justice.

One last point. Petitioners contend that Tumala has no cause of action to ask for back salaries and damages because his dismissal was
authorized by the Regional Director of the Ministry of Labor. This question calls for the presentation of evidence and the same may
well be ventilated before the Labor Arbiter who has jurisdiction over the case. Besides, the issue raised is not for Us to determine in
this certiorari proceeding. The extraordinary remedy of certiorari offers only a limited form of review and its principal function is to
keep an inferior tribunal within its jurisdiction.[5]

WHEREFORE, the petition is granted, and respondent judge is hereby directed to dismiss Civil Case No. 13494, without prejudice
to the right of respondent Tumala to refile the same with the Labor Arbiter. No costs.

--

San Miguel Corporation vs. NLRC

OCTOBER 23, 2012 ~ VBDIAZ

San Miguel Corporation vs. NLRC

G.R. Nos. 146121-22, April 16, 2008

Facts:

Ibias (respondent) was employed by petitioner SMC on 24 December 1978

initially as a CRO operator in its Metal Closure and Lithography Plant.
Respondent continuously worked therein until he advanced as Zamatic
operator. He was also an active and militant member of a labor organization
called Ilaw Buklod Manggagawa (IBM)-SMC Chapter.

According to SMC’s Policy on Employee Conduct, absences without

permission or AWOPs, which are absences not covered either by a certification
of the plant doctor that the employee was absent due to sickness or by a duly
approved application for leave of absence filed at least 6 days prior to the
intended leave, are subject to disciplinary action characterized by
progressively increasing weight. The same Policy on Employee Conduct also
punishes falsification of company records or documents with discharge or
termination for the first offense if the offender himself or somebody else
benefits from falsification or would have benefited if falsification is not found
on time.

It appears that per company records, respondent was AWOP on the following
dates in 1997: 2, 4 and 11 January; 26, 28 and 29 April; and 5, 7, 8, 13, 21, 22,
28 and 29 May. For his absences on 2, 4 and 11 January and 28 and 29 April,
he was given a written warning dated 9 May 1997 that he had already incurred
five (5) AWOPs and that further absences would be subject to disciplinary
action. For his absences on 28 and 29 April and 7 and 8 May, respondent was
alleged to have falsified his medical consultation card by stating therein that
he was granted sick leave by the plant clinic on said dates when in truth he was
not.

After the completion of the investigation, SMC concluded that respondent

committed the offenses of excessive AWOPs and falsification of company
records or documents, and accordingly dismissed him.

On 30 March 1998, respondent filed a complaint for illegal dismissal against

SMC. The labor arbiter believed that respondent had committed the absences
pointed out by SMC but found the imposition of termination of employment
based on his AWOPs to be disproportionate since SMC failed to show by clear
and convincing evidence that it had strictly implemented its company policy
on absences. It also noted that termination based on the alleged falsification
of company records was unwarranted in view of SMC’s failure to establish
respondent’s guilt.

The appellate court also held that respondent’s AWOPs did not warrant his
dismissal in view of SMC’s inconsistent implementation of its company
policies. It could not understand why respondent was given a mere warning
for his absences on 28 and 29 April which constituted his 5th and 6th AWOPs,
respectively, when these should have merited suspension under SMC’s policy.
According to the appellate court, since respondent was merely warned,
logically said absences were deemed committed for the first time; thus, it
follows that the subject AWOPs did not justify his dismissal because under
SMC’s policy, the 4th to 9th AWOPs are meted the corresponding penalty only
when committed for the second time.
Issue: WON the Court of Appeals erred in sustaining the findings of the labor
arbiter and the NLRC and in dismissing SMC’s claims that respondent was
terminated from service with just cause.

Held:

Proof beyond reasonable doubt is not required as a basis for judgment on the
legality of an employer’s dismissal of an employee, nor even preponderance of
evidence for that matter, substantial evidence being sufficient. In the instant
case, while there may be no denying that respondent’s medical card had
falsified entries in it, SMC was unable to prove, by substantial evidence, that it
was respondent who made the unauthorized entries. Besides, SMC’s (Your)
Guide on Employee Conduct punishes the act of falsification of company
records or documents; it does not punish mere possession of a falsified
document.

Respondent cannot feign surprise nor ignorance of the earlier AWOPs he had
incurred. He was given a warning for his 2, 4, and 11 January and 26, 28, and
29 April 1997 AWOPs. In the same warning, he was informed that he already
had six AWOPs for 1997. He admitted that he was absent on 7 and 8 May
1997. He was also given notices to explain his AWOPs for the period 26 May to
2 June 1997, which he received but refused to acknowledge. It does not take a
genius to figure out that as early as June 1997, he had more than nine AWOPs.

In any case, when SMC imposed the penalty of dismissal for the 12th and 13th
AWOPs, it was acting well within its rights as an employer. An employer has
the prerogative to prescribe reasonable rules and regulations necessary for the
proper conduct of its business, to provide certain disciplinary measures in
order to implement said rules and to assure that the same would be complied
with. An employer enjoys a wide latitude of discretion in the promulgation of
policies, rules and regulations on work-related activities of the employees.

It is axiomatic that appropriate disciplinary sanction is within the purview of

management imposition. Thus, in the implementation of its rules and policies,
the employer has the choice to do so strictly or not, since this is inherent in its
right to control and manage its business effectively. Consequently,
management has the prerogative to impose sanctions lighter than those
specifically prescribed by its rules, or to condone completely the violations of
its erring employees. Of course, this prerogative must be exercised free of
grave abuse of discretion, bearing in mind the requirements of justice and fair
play.

All told, we find that SMC acted well within its rights when it dismissed
respondent for his numerous absences. Respondent was afforded due process
and was validly dismissed for cause.

JOVITO N. QUISABA vs. STA. INES-MELALE VENEER & PLYWOOD, INC.

G.R. No. L-38088

August 30, 1974

FACTS: Quisaba was an internal auditor of SIMVP for 18 years. On January 1973, SIMVP VP Robert Hyde instructed
him to purchase logs for the company’s plant, but Quisaba, he refused to do so, saying that such task is inconsistent
with his position. The next day, Hyde informed Quisaba of his temporary relief as internal auditor so that he could
carry out the instructions given. Hyde warned him that failure to comply would be considered a ground for his
dismissal.

Quisaba responded with a plea for fairness and mercy as he would be without a job during an economic crisis and
that he was demoted from a position of dignity to a servile and menial job.

Quisaba filed a complaint for moral damages, exemplary damages, termination pay and attorney’s fees against
SIMVP and its VP Robert Hyde. Quisaba was NOT asking for backwages nor reinstatement. Quisaba alleged that due
to SIMVP’s acts, he suffered mental anguish, serious anxiety, besmirched reputation, wounded feelings, moral shock
and social humiliation.

SIMVP moved to dismiss the complaint on the ground of lack of jurisdiction of the CFI, asserting that the proper
forum is the NLRC. Quisaba opposed this, and he informed the court that an NLRC representative said that NLRC has
no jurisdiction over claims or suits for damages arising out of employee-employer relationship. Nonetheless, CFI
granted the motion to dismiss on the ground that the complaint involves an employee-employer relation.

ISSUE: WON there was an oppressive dismissal?

HELD: YES.

RATIO: The “right” of the respondents to dismiss Quisaba should not be confused with the manner in which the
right was exercised and the effects flowing therefrom. If the dismissal was done anti-socially or oppressively, as the
complaint alleges, then the respondents violated article 1701 of the Civil Code which prohibits acts of oppression by
either capital or labor against the other, and article 21, which makes a person liable for damages if he wilfully causes
loss or injury to another in a manner that is contrary to morals, good customs or public policy, the sanction for
which, by way of moral damages, is provided in article 2219, no. 10.

This case is concerned with a civil (not a labor) dispute, as it has to do with an alleged violation of Quisaba’s rights as
a member of society, and it does not involve an existing employee-employer relation.

Civil law consists of that mass of precepts that determine or regulate the relations that exist between members of a
society for the protection of private interests.

Although the acts complained of seemingly appear to constitute “matters involving employee-employer relations,”
Quisaba’s complaint is grounded on the manner of his dismissal and the consequent effects of such dismissal, not on
his dismissal per se, as he does not ask for reinstatement or backwages.

The “right” of SIMVP to dismiss Quisaba should not be confused with the manner in which the right was exercised
and the effects flowing therefrom. If the dismissal was done anti-socially or oppressively, then SIMVP violated the
following:

NCC 1701 – prohibits acts of oppression by either capital or labor against the other

NCC 21– makes a person liable for damages if he willfully causes loss or injury to another in a manner that is
contrary to morals, good customs or public policy.

DISPOSITION: The order of September 18, 1973 is set aside, and this case is hereby ordered remanded to the
court a quo for further proceedings in accordance with law. Costs against the private respondents.

--

SANTIAGO vs. CF SHARP CREW DIGEST

DECEMBER 20, 2016 ~ VBDIAZ

PAUL V. SANTIAGO, petitioner, vs. CF SHARP CREW MANAGEMENT, INC.,

respondent.

G.R. No. 162419

July 10, 2007

FACTS:

Petitioner had been working as a seafarer for Smith Bell Management, Inc.
(respondent) for about 5 yrs. In February 3, 1998, petitioner signed a new
contract of employment with respondent, with the duration of 9 months. The
contract was approved by POEA. Petitioner was to be deployed on board the
“MSV Seaspread” which was scheduled to leave the port of Manila for Canada on
13 February 1998.
A week before the date of departure, Capt. Pacifico Fernandez, respondent’s Vice
President, sent a facsimile message to the captain of “MSV Seaspread,”, saying
that it received a phone call from Santiago’s wife and some other callers who did
not reveal their identity and gave him some feedbacks that Paul Santiago this
time, if allowed to depart, will jump ship in Canada like his brother Christopher
Santiago. The captain of “MSV Seaspread replied that it cancel plans for Santiago
to return to Seaspread.
Petitioner thus told that he would not be leaving for Canada anymore. Petitioner
filed a complaint for illegal dismissal, damages, and attorney’s fees against
respondent and its foreign principal, Cable and Wireless (Marine) Ltd. The Labor
Arbiter (LA) favored petitioner and ruled that the employment contract
remained valid but had not commenced since petitioner was not deployed and
that respondent violated the rules and regulations governing overseas
employment when it did not deploy petitioner, causing petitioner to suffer actual
damages. On appeal by respondent, NLRC ruled that there is no employer-
employee relationship between petitioner and respondent because the
employment contract shall commence upon actual departure of the seafarer from
the airport or seaport at the point of hire and with a POEA-approved contract. In
the absence of an employer-employee relationship between the parties, the
claims for illegal dismissal, actual damages, and attorney’s fees should be
dismissed. But the NLRC found respondent’s decision not to deploy petitioner to
be a valid exercise of its management prerogative. Petitioner filed MR but it was
denied. He went to CA. CA affirmed the decision of NLRC. Petitioner’s MR was
denied. Hence this case.
ISSUE:

When does an employer- employee relationship begin in the case at bar.

RULING:

There is some merit in the petition. The parties entered into an employment
contract whereby petitioner was contracted by respondent to render services on
board “MSV Seaspread” for the consideration of US$515.00 per month for 9
months, plus overtime pay. However, respondent failed to deploy petitioner from
the port of Manila to Canada. Considering that petitioner was not able to depart
from the airport or seaport in the point of hire, the employment contract did not
commence, and no employer-employee relationship was created between the
parties. However, a distinction must be made between the perfection of the
employment contract and the commencement of the employer-employee
relationship. The perfection of the contract, which in this case coincided with the
date of execution thereof, occurred when petitioner and respondent agreed on
the object and the cause, as well as the rest of the terms and conditions therein.
The commencement of the employer-employee relationship would have taken
place had petitioner been actually deployed from the point of hire. Thus, even
before the start of any employer-employee relationship, contemporaneous with
the perfection of the employment contract was the birth of certain rights and
obligations, the breach of which may give rise to a cause of action against the
erring party. Thus, if the reverse had happened, that is the seafarer failed or
refused to be deployed as agreed upon, he would be liable for damages.
Neither the manning agent nor the employer can simply prevent a seafarer from
being deployed without a valid reason. Respondent’s act of preventing petitioner
from departing the port of Manila and boarding “MSV Seaspread” constitutes a
breach of contract, giving rise to petitioner’s cause of action. Respondent
unilaterally and unreasonably reneged on its obligation to deploy petitioner and
must therefore answer for the actual damages he suffered.
Despite the absence of an employer-employee relationship between petitioner
and respondent, the Court rules that the NLRC has jurisdiction over petitioner’s
complaint. The jurisdiction of labor arbiters is not limited to claims arising from
employer-employee relationships. Section 10 of R.A. No. 8042 (Migrant Workers
Act), provides that:
Sec. 10. Money Claims. – Notwithstanding any provision of law to the contrary, the
Labor Arbiters of the NLR) shall have the original and exclusive jurisdiction to hear
and decide, within 90 calendar days after the filing of the complaint, the claims
arising out of an employer-employee relationship or by virtue of any law or
contract involving Filipino workers for overseas deployment including claims for
actual, moral, exemplary and other forms of damages.”
Since the present petition involves the employment contract entered into by
petitioner for overseas employment, his claims are cognizable by the labor
arbiters of the NLRC.
Respondent is liable to pay petitioner only the actual damages in the form of the
loss of nine (9) months’ worth of salary as provided in the contract. He is not,
however, entitled to overtime pay. While the contract indicated a fixed overtime
pay, it is not a guarantee that he would receive said amount regardless of
whether or not he rendered overtime work. Even though petitioner was
prevented without valid reason from rendering regular much less overtime
service, the fact remains that there is no certainty that petitioner will perform
overtime work had he been allowed to board the vessel. The amount stipulated
in the contract will be paid only if and when the employee rendered overtime
work. Realistically speaking, a seaman, by the very nature of his job, stays on
board a ship or vessel beyond the regular eight-hour work schedule. For the
employer to give him overtime pay for the extra hours when he might be
sleeping or attending to his personal chores or even just lulling away his time
would be extremely unfair and unreasonable.
The Court also holds that petitioner is entitled to attorney’s fees in the concept of
damages and expenses of litigation. Respondent’s basis for not deploying
petitioner is the belief that he will jump ship just like his brother, a mere
suspicion that is based on alleged phone calls of several persons whose identities
were not even confirmed. This Court has upheld management prerogatives so
long as they are exercised in good faith for the advancement of the employer’s
interest and not for the purpose of defeating or circumventing the rights of the
employees under special laws or under valid agreements. Respondent’s failure to
deploy petitioner is unfounded and unreasonable However, moral damages
cannot be awarded in this case. because respondent’s action was not tainted with
bad faith, or done deliberately to defeat petitioner’s rights, as to justify the award
of moral damages.
Seafarers are considered contractual employees and cannot be considered as
regular employees under the Labor Code. Their employment is governed by the
contracts they sign every time they are rehired and their employment is
terminated when the contract expires. The exigencies of their work necessitates
that they be employed on a contractual basis.
WHEREFORE, petition is GRANTED IN PART.
--

Case Doctrines in Labor Law

CASE DOCTRINES IN LABOR LAW REVIEW
Compiled by Glenn Rey D. Anino
Juris Doctor
 University of Cebu

Labadan vs. Forest Hills Academy, 575 SCRA 262 , December 23, 2008
Labor Law; Illegal Dismissals; Burden of Proof; While in cases of illegal dismissal, the
employer bears the burden of proving that the dismissal is for a valid or authorized
cause, the employee must first establish by substantial evidence the fact of dismissal.—
While in cases of illegal dismissal, the employer bears the burden of proving that the
dismissal is for a valid or authorized cause, the employee must first establish by
substantial evidence the fact of dismissal. The records do not show that petitioner was
dismissed from the service. They in fact show that despite petitioner’s absence from
July 2001 to March 2002 which, by her own admission, exceeded her approved leave,
she was still considered a member of the Forest Hills faculty which retained her in its
payroll.
Same; Labor Standards; Holiday Pay; The provision that a worker is entitled to twice his
regular rate if he is required to work on a holiday implies that the provision entitling a
worker to his regular rate on holidays applies even if he does not work.—Respecting
petitioner’s claim for holiday pay, Forest Hills contends that petitioner failed to prove that
she actually worked during specific holidays. Article 94 of the Labor Code provides,
however, that (a) Every worker shall be paid his regular daily wage during regular
holidays, except in retail and service establishments regularly employing less than ten
(10) workers; (b) The employer may require an employee to work on any holiday but
such employee shall be paid a compensation equivalent to twice his regular rate[.] The
provision that a worker is entitled to twice his regular rate if he is required to work on a
holiday implies that the provision entitling a worker to his [Labadan vs. Forest Hills
Academy, 575 SCRA 262(2008)]

People vs. Panis, 142 SCRA 664, July 11, 1986

Labor; Recruitment and placement; Interpretation; Article 13(b) of P.D. 442, interpreted;
Presumption that the individual or entity is engaged in recruitment and placement
whenever two or more persons are involved; Number of persons, not an essential
ingredient of the act of recruitment and placement of workers.—As we see it, the
proviso was intended neither to impose a condition on the basic rule nor to provide an
exception thereto but merely to create a presumption. The presumption is that the
individual or entity is engaged in recruitment and placement whenever he or it is dealing
with two or more persons to whom, in consideration of a fee, an offer or promise of
employment is made in the course of the “canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring (of) workers.” The number of persons dealt
with is not an essential ingredient of the act of recruitment and placement of workers.
Any of the acts mentioned in the basic rule in Article 13(b) will constitute recruitment
and placement even if only one prospective worker is involved. The proviso merely lays
down a rule of evidence that where a fee is collected in consideration of a promise or
offer of employment to two or more prospective workers, the individual or entity dealing
with them shall be deemed to be engaged in the act of recruitment and placement. The
words “shall be deemed” create that presumption.
Same; Same; Same; Same; Words “shall be deemed” in Art. 13(b) of P.D. 442,
meaning of.—In the instant case, the word “shall be deemed” should by the same token
be given the force of a disputable presumption or of prima facie evidence of engaging in
recruitment and placement.

C.F. Sharp Crew Management, Inc. vs. Espanol, Jr., 533 SCRA 424 , September 14,
2007
Labor Law; Labor Code, Judgment; Appeals; A judgment debtor who acquiesces of and
voluntarily complies with the judgment is estopped from taking an appeal therefrom.

Same; Same; Illegal Recruitment; Definition of Recruitment and Placement; The

conduct of preparatory interviews is a recruitment activity.—Article 13(b) of the Labor
Code defines recruitment and placement as: any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring or procuring workers, and includes referrals,
contract services, promising or advertising for employment, locally or abroad whether
for profit or not: Provided, That any person or entity which in any manner, offers or
promises for a fee employment to two or more persons shall be deemed engaged in
recruitment and placement. On the basis of this definition—and contrary to what C.F.
Sharp wants to portray—the conduct of preparatory interviews is a recruitment activity.
Same; Same; Same; It is the lack of the necessary license or authority, not the fact of
payment, that renders the recruitment activity of LCL unlawful.—The fact that C.F.
Sharp did not receive any payment during the interviews is of no moment. From the
language of Article 13(b), the act of recruitment may be “for profit or not.” Notably, it is
the lack of the necessary license or authority, not the fact of payment, that renders the
recruitment activity of LCL unlawful.

Same; Appeals; Due Process; The essence of due process lies in the reasonable
opportunity afforded a party to be heard and to submit any evidence in support of its
defense; What is vital is not the opportunity to cross-examine an adverse witness, but
an opportunity to be heard.—The claim of denial of due process on the part of C.F.
Sharp must also be rejected. The essence of due process lies in the reasonable
opportunity afforded a party to be heard and to submit any evidence in support of its
defense. What is vital is not the opportunity to cross-examine an adverse witness, but
an opportunity to be heard. In this case, C.F. Sharp was given ample opportunity to be
heard, to adduce evidence in support of its version of the material occurrences, and to
controvert Rizal’s allegation and the Inspection Report. It submitted its position paper
with supporting affidavits and documents, and additionally pleaded its causes on appeal
before the Secretary of Labor. Under the circumstances, a claim of denial of due
process on C.F. Sharp’s part is completely unavailing.
Same; Same; Judicial review of labor cases does not go beyond the evaluation of the
sufficiency of the evidence upon which the labor officials’ findings rest.—C.F. Sharp
would have us re-evaluate the factual veracity and probative value of the evidence
submitted in the proceedings a quo. C.F. Sharp may well be reminded that it is not our
function to review, examine, and evaluate or weigh the evidence adduced by the
parties. Elementary is the principle that this Court is not a trier of facts. Judicial review of
labor cases does not go beyond the evaluation of the sufficiency of the evidence upon
which the labor officials’ findings rest. Hence, where the factual findings of the labor
tribunals or agencies conform to, and are affirmed by, the CA, the same are accorded
respect and finality, and are binding upon this Court. It is only when the findings of the
labor agencies and the appellate court are in conflict that this Court will review the
records to determine which findings should be upheld as being more in conformity with
the evidentiary facts. Where the CA affirms the labor agencies on review and there is no
showing whatsoever that said findings are patently erroneous, this Court is bound by
the said findings. [C.F. Sharp Crew Management, Inc. vs. Espanol, Jr., 533 SCRA
424(2007)]

Santiago vs. CF Sharp Crew Management, Inc., 527 SCRA 165 , July 10, 2007
Labor Law; Employer-Employee Relationships; Seafarers; Considering that petitioner
was not able to depart from the airport or seaport in the point of hire, the employment
contract did not commence and no employer-employee relationship was created
between the parties.—There is no question that the parties entered into an employment
contract on 3 February 1998, whereby petitioner was contracted by respondent to
render services on board “MSV Seaspread” for the consideration of US$515.00 per
month for nine (9) months, plus overtime pay. However, respondent failed to deploy
petitioner from the port of Manila to Canada. Considering that petitioner was not able to
depart from the airport or seaport in the point of hire, the employment contract did not
commence, and no employer-employee relationship was created between the parties.
Same; Same; Distinction must be made between the perfection of the employment
contract and the commencement of the employer employee relationship; Even before
the start of any employer-employee relationship, contemporaneous with the perfection
of the employment contract was the birth of certain rights and obligations, the breach of
which may give rise to a cause of action against the erring party.—A distinction must be
made between the perfection of the employment contract and the commencement of
the employer-employee relationship. The perfection of the contract, which in this case
coincided with the date of execution thereof, occurred when petitioner and respondent
agreed on the object and the cause, as well as the rest of the terms and conditions
therein. The commencement of the employer employee relationship, as earlier
discussed, would have taken place had petitioner been actually deployed from the point
of hire. Thus, even before the start of any employer-employee relationship,
contemporaneous with the perfection of the employment contract was the birth of
certain rights and obligations, the breach of which may give rise to a cause of action
against the erring party. Thus, if the reverse had happened, that is the seafarer failed or
refused to be deployed as agreed upon, he would be liable for damages.
Same; Same; Seafarers; Neither the manning agent nor the employer can simply
prevent a seafarer from being deployed without a valid reason; Respondent unilaterally
and unreasonably reneged on its obligation to deploy petitioner and must therefore
answer for the actual damages he suffered.—While the POEA Standard Contract must
be recognized and respected, neither the manning agent nor the employer can simply
prevent a seafarer from being deployed without a valid reason. Respondent’s act of
preventing petitioner from departing the port of Manila and boarding “MSV Seaspread”
constitutes a breach of contract, giving rise to petitioner’s cause of action. Respondent
unilaterally and unreasonably reneged on its obligation to deploy petitioner and must
therefore answer for the actual damages he suffered.

Same; Same; Same; The fact that the Philippine Overseas Employment Administration
(POEA) Rules are silent as to the payment of damages to the affected seafarer does
not mean that the seafarer is precluded from claiming the same.—We take exception to
the Court of Appeals’ conclusion that damages are not recoverable by a worker who
was not deployed by his agency. The fact that the POEA Rules are silent as to the
payment of damages to the affected seafarer does not mean that the seafarer is
precluded from claiming the same. The sanctions provided for non-deployment do not
end with the suspension or cancellation of license or fine and the return of all
documents at no cost to the worker. They do not forfend a seafarer from instituting an
action for damages against the employer or agency which has failed to deploy him.

Same; Same; Despite the absence of an employer-employee relationship between

petitioner and respondent, the Court rules that the National Labor Relations
Commission (NLRC) has jurisdiction over petitioner’s complaint.—Despite the absence
of an employer employee relationship between petitioner and respondent, the Court
rules that the NLRC has jurisdiction over petitioner’s complaint. The jurisdiction of labor
arbiters is not limited to claims arising from employer-employee relationships. Section
10 of R.A. No. 8042 (Migrant Workers Act), provides that: Sec.10.Money Claims.—
Notwithstanding any provision of law to the contrary, the Labor Arbiters of the National
Labor Relations Commission (NLRC) shall have the original and exclusive jurisdiction to
hear and decide, within ninety (90) calendar days after the filing of the complaint, the
claims arising out of an employer-employee relationship or by virtue of any law or
contract involving Filipino workers for overseas deployment including claims for actual,
moral, exemplary and other forms of damages. x x x [Emphasis supplied] Since the
present petition involves the employment contract entered into by petitioner for
overseas employment, his claims are cognizable by the labor arbiters of the NLRC.
Same; Same; Seafarers; Respondent liable to pay petitioner actual damages in the form
of the loss of nine (9) months’ worth of salary as provided in the contract, petitioner is
not entitled to overtime pay.—Respondent is thus liable to pay petitioner actual
damages in the form of the loss of nine (9) months’ worth of salary as provided in the
contract. He is not, however, entitled to overtime pay. While the contract indicated a
fixed overtime pay, it is not a guarantee that he would receive said amount regardless of
whether or not he rendered overtime work. Even though petitioner was “prevented
without valid reason from rendering regular much less overtime service,” the fact
remains that there is no certainty that petitioner will perform overtime work had he been
allowed to board the vessel. The amount of US$286.00 stipulated in the contract will be
paid only if and when the employee rendered overtime work. This has been the tenor of
our rulings in the case of Stolt-Nielsen Marine Services (Phils.), Inc. v. National Labor
Relations Commission, 258 SCRA 643 (1996), where we discussed the matter in this
light: The contract provision means that the fixed overtime pay of 30% would be the
basis for computing the overtime pay if and when overtime work would be rendered.
Simply stated, the rendition of overtime. work and the submission of sufficient proof that
said work was actually performed are conditions to be satisfied before a seaman could
be entitled to overtime pay which should be computed on the basis of 30% of the basic
monthly salary. In short, the contract provision guarantees the right to overtime pay but
the entitlement to such benefit must first be established. Realistically speaking, a
seaman, by the very nature of his job, stays on board a ship or vessel beyond the
regular eight-hour work schedule. For the employer to give him overtime pay for the
extra hours when he might be sleeping or attending to his personal chores or even just
lulling away his time would be extremely unfair and unreasonable.

Same; Same; Attorney’s Fees; Respondent’s failure to deploy petitioner is unfounded

and unreasonable, forcing petitioner to institute the suit below; Award of attorney’s fees
is thus warranted.—The Court also holds that petitioner is entitled to attorney’s fees in
the concept of damages and expenses of litigation. Attorney’s fees are recoverable
when the defendant’s act or omission has compelled the plaintiff to incur expenses to
protect his interest. We note that respondent’s basis for not deploying petitioner is the
belief that he will jump ship just like his brother, a mere suspicion that is based on
alleged phone calls of several persons whose identities were not even confirmed. Time
and again, this Court has upheld management prerogatives so long as they are
exercised in good faith for the advancement of the employer’s interest and not for the
purpose of defeating or circumventing the rights of the employees under special laws or
under valid agreements. Respondent’s failure to deploy petitioner is unfounded and
unreasonable, forcing petitioner to institute the suit below. The award of attorney’s fees
is thus warranted.
Same; Same; Seafarers; Nature of Employment; Seafarers are considered contractual
employees and cannot be considered as regular employees under the Labor Code.—
We likewise do not see respondent’s failure to deploy petitioner as an act designed to
prevent the latter from attaining the status of a regular employee. Even if petitioner was
able to depart the port of Manila, he still cannot be considered a regular employee,
regardless of his previous contracts of employment with respondent. In Millares v.
National Labor Relations Commission, 385 SCRA 306 (2002), the Court ruled that
seafarers are considered contractual employees and cannot be considered as regular
employees under the Labor Code. Their employment is governed by the contracts they
sign every time they are rehired and their employment is terminated when the contract
expires. The exigencies of their work necessitates that they be employed on a
contractual basis.

Ambraque International Placement & Services vs. NLRC, 157 SCRA 431, January
28, 1988
Labor; NLRC; Overseas Employment; Illegal Dismissal; Dismissal of worker that he
allegedly exhibited disagreeable conduct when he was abroad, is a sweeping statement
and without any elaboration by the employer; Absence of details surrounding the charge
of disagreeable conduct of the worker casts veracity on the charge.—The allegation that
the private respondent exhibited disagreeable conduct when he was abroad thus paving
the way for his dismissal is a sweeping statement. The allegation is not even
accompanied by any elaboration on the matter. If the said allegation were true, then the
petitioner would have discussed in detail the circumstances surrounding such
disagreeable conduct in order to support its stand. The absence of such vital
information casts suspicion on the veracity of the allegation of the petitioner. As
observed by the Solicitor General, the telex messages relied upon by the petitioner do
not establish that the private respondent was dismissed from his employment for just
cause. Both telex messages are general statements. There is no record that the
principal gave additional information on the dismissal. At the most, the second telex
message implies that the previous employment experience of the private respondent in
Saudi Arabia causes problems to the principal.
Same; Same; Same; Same; Recruitment agency, jointly and solidarity liable with its
principal to the worker corresponding to the entire remuneration covered by the
employment contract.—Finally, the petitioner recruitment agency should be jointly and
solidarity liable with its principal as far as this case is concerned. Pursuant to Section
10, Rule V of the Implementing Regulations of the Labor Code, a recruitment agency
can be sued solidarity with its principal.

Interorient Maritime Enterprises, Inc. vs. NLRC, 261 SCRA 757 , September 16,
1996
Actions; Certiorari; Pleadings and Practice; Petitioners act prematurely when they
immediately bring a petition for certiorari without having filed any motion for
reconsideration with the respondent agency.

Same; Same; Same; A petition for certiorari under Rule 65 of the Rules of Court will lie
only in cases where a grave abuse of discretion or an act without or in excess of
jurisdiction is clearly shown to have been committed by the respondent Commission,
and the Supreme Court’s jurisdiction to review decisions or resolutions of the
respondent NLRC does not include a correction of its evaluation of the evidence.—But
even if the aforesaid procedural defect were to be overlooked, the instant petition
nevertheless suffers from serious substantive flaws. The petition assails the Resolution
of the respondent Commission as lacking factual and legal bases to support the same.
A petition for certiorari under Rule 65 of the Rules of Court will lie only in cases where a
grave abuse of discretion or an act without or in excess of jurisdiction is clearly shown to
have been committed by the respondent Commission, and this Court’s jurisdiction to
review decisions or resolutions of the respondent NLRC does not include a correction of
its evaluation of the evidence. Moreover, it is a fundamental rule that the factual findings
of quasi-judicial agencies like the respondent NLRC, if supported by substantial
evidence, are generally accorded not only great respect but even finality, and are
binding upon this Court, unless the petitioner is able to clearly demonstrate that
respondent Commission had arbitrarily disregarded evidence before it or had
misapprehended evidence to such an extent as to compel a contrary conclusion if such
evidence had been properly appreciated.
Labor Law; Overseas Contract Workers; Evidence; Pleadings and Practice; Claims of
overseas workers against their foreign employers should not be subjected to the rules of
evidence and procedure that courts usually apply to other complainants who have more
facility in obtaining the required evidence to prove their demands.—First, a word about
the evidence supporting the findings of the POEA Administrator. We have held that
claims of overseas workers against their foreign employers should not be subjected to
the rules of evidence and procedure that courts usually apply to other complainants who
have more facility in obtaining the required evidence to prove their demands. Section 5,
Rule 133 of the Rules of Court provides that in cases filed before administrative or
quasi-judicial bodies (like the POEA), a fact may be deemed established if it is
supported by substantial evidence, i.e., that amount of evidence which a reasonable
mind might accept as adequate to justify a conclusion.

Same; Same; Insanity; The mental disorder of a Filipino overseas contract worker
became evident when he failed to join his connecting flight to Hongkong, having during
said stopover wandered out of the Bangkok airport’s immigration area on his own, there
being no sane and sufficient reason for him to want to while away his time in a foreign
land, when he is presumably unfamiliar with its native tongue, with nothing to do and no
source of income, and after having been absent from kith and kin, hearth and home for
almost an entire year.—The circumstances prior to and surrounding his death, however,
provide substantial evidence of the existence of such mental defect or disorder. Such
mental disorder became evident when he failed to join his connecting flight to
Hongkong, having during said stopover wandered out of the Bangkok airport’s
immigration area on his own. We can perceive no sane and sufficient reason for a Pinoy
overseas contract worker or seaman to want to while away his time in a foreign land,
when he is presumably unfamiliar with its native tongue, with nothing to do and no
source of income, and after having been absent from kith and kin, hearth and home for
almost an entire year. Nor can we find any plausible reason for him to be wielding a
knife and scaring away passersby, and even taking a stab at an armed policeman,
unless he is no longer in full possession of his sanity. To our mind, these circumstances
are sufficient in themselves to produce a firm conviction that the deceased seaman in
this case was no longer in full control of his senses when he left his work. To reiterate,
in this case, no more than substantial evidence is required.

Same; Same; Same; Where an overseas contract worker attacked a Thai policeman
when he was no longer in complete control of his mental faculties, the provisions of the
Standard Format Contract of Employment exempting the employer from liability does
not apply.—The POEA Administrator ruled, and this Court agrees, that since Pineda
attacked the Thai policeman when he was no longer in complete control of his mental
faculties, the aforequoted provision of the Standard Format Contract of Employment
exempting the employer from liability should not apply in the instant case. Firstly, the
fact that the deceased suffered from mental disorder at the time of his repatriation
means that he must have been deprived of the full use of his reason, and that thereby,
his will must have been impaired, at the very least. Thus, his attack on the policeman
can in no wise be characterized as a deliberate, willful or voluntary act on his part.

Same; Same; Same; The failure of a foreign employer to observe some precautionary
measures and in allowing an overseas worker with mental disorder to travel home alone
render it liable for the death of said worker.—Secondly, and apart from that, we also
agree that in light of the deceased’s mental condition, petitioners “should have observed
some precautionary measures and should not have allowed said seaman to travel home
alone,” and their failure to do so rendered them liable for the death of Pineda. Indeed,
“the obligations and liabilities of the (herein petitioners) do not end upon the expiration
of the contracted period as (petitioners are) duty bound to repatriate the seaman to the
point of hire to effectively terminate the contract of employment.”

Same; Same; Even if the termination of the employment contract is duly effected in a
foreign country, still the responsibility of the foreign employer to see to it that the worker
is duly repatriated to the point of hiring subsists.—Petitioner’s reliance on De Jesus is
misplaced, as the death and burial benefits being claimed in this case are not payable
by the Employees’ Compensation Commission and chargeable against the State
Insurance Fund. These claims arose from the responsibility of the foreign employer
together with the local agency for the safety of the employee during his repatriation and
until his arrival in this country, i.e., the point of hire. Though the termination of the
employment contract was duly effected in Dubai, still, the responsibility of the foreign
employer to see to it that Pineda was duly repatriated to the point of hiring subsisted.
Section 4, Rule VIII of the Rules and Regulations Governing Overseas Employment
clearly provides for the duration of the mandatory personal accident and life insurance
covering accidental death, dismemberment and disability of overseas workers: “Section
4. Duration of Insurance Coverage.—The minimum coverage shall take effect upon
payment of the premium and shall be extended worldwide, on and off the job, for the
duration of the worker’s contract plus sixty (60) calendar days after termination of the
contract of employment; provided that in no case shall the duration of the insurance
coverage be less than one year.” (Italics supplied)

Same; Same; The foreign employer may not be obligated by its contract to provide a
companion for a returning employee but it cannot deny that it is expressly tasked by its
agreement to assure the safe return of said worker.—The foreign employer may not
have been obligated by its contract to provide a companion for a returning employee,
but it cannot deny that it was expressly tasked by its agreement to assure the safe
return of said worker. The uncaring attitude displayed by petitioners who, knowing fully
well that its employee had been suffering from some mental disorder, nevertheless still
allowed him to travel home alone, is appalling to say the least. Such attitude harks back
to another time when the landed gentry practically owned the serfs, and disposed of
them when the latter had grown old, sick or otherwise lost their usefulness. [Interorient
Maritime Enterprises, Inc. vs. NLRC, 261 SCRA 757(1996)]

De Jesus vs. National Labor Relations Commission, 530 SCRA 489 , August 17,
2007
Labor Law; Appeals; Judicial review by this Court does not extend to a re-evaluation of
the sufficiency of the evidence upon which the proper labor tribunal has based its
determination—firm is the doctrine that this Court is not a trier of facts, and this applies
with greater force in labor cases.—It is a settled rule that under Rule 45 of the Rules of
Court, only questions of law may be raised before this Court. Judicial review by this
Court does not extend to a re-evaluation of the sufficiency of the evidence upon which
the proper labor tribunal has based its determination. Firm is the doctrine that this Court
is not a trier of facts, and this applies with greater force in labor cases. However, factual
issues may be considered and resolved when the findings of facts and conclusions of
law of the Labor Arbiter are inconsistent with those of the NLRC and the Court of
Appeals, as in this case.
Same; Disease; The rule is that an ailment contracted by a worker even prior to his
employment, does not detract from the compensability of the disease.—The evidence
shows that De Jesus previously suffered from ulcer but he ticked “NO” in his medical
history. De Jesus, therefore, committed misrepresentation. Nonetheless, he passed the
pre-employment medical examination, was reported fit to work, and was suffered to
work on board M/V Author for more than two (2) months, until his repatriation on June
19, 1997. The rule is that an ailment contracted even prior to his employment, does not
detract from the compensability of the disease. It is not required that the employment be
the sole factor in the growth, development or acceleration of the illness to entitle the
claimant to the benefits incident thereto. It is enough that the employment had
contributed, even in a small measure, to the development of the disease.
Same; Same; A worker’s misrepresentation cannot be made the basis by his employer
for the denial of his claims under the contract where he passed the required pre-medical
examination and was declared fit to work.—In OSM Shipping Philippines, Inc. v. Dela
Cruz, 449 SCRA 525 (2005), this Court, in granting similar claims, held: Labor contracts
are impressed with public interest and the provisions of the POEA Standard
Employment Contract must be construed fairly, reasonably and liberally in favor of
Filipino seamen in the pursuit of their employment on board ocean-going vessels.
Despite his misrepresentation, Arbit underwent and passed the required pre-medical
examination, was declared fit to work, and was suffered to work by petitioner. Upon
repatriation, he complied with the required post-employment medical examination.
Under the beneficent provisions of the Contract, it is enough that the work has
contributed, even in a small degree, to the development of the disease and in bringing
about his death. Strict proof of causation is not required. De Jesus’ misrepresentation
cannot, therefore, be made basis by POMI for the denial of his claims under the
contract.

Same; Illegal Dismissals; Burden of Proof; Settled is the rule that in termination cases,
the burden of proof rests upon the employer to show that the dismissal is for a just and
valid cause.—Settled is the rule that in termination cases, the burden of proof rests
upon the employer to show that the dismissal is for a just and valid cause. The case of
the employer must stand or fall on its own merits and not on the weakness of the
employee’s defense. In this case, no convincing proof was offered to prove POMI’s
allegation. All that we have is its self-serving assertion that De Jesus violated his
employment contract. There is no proof that the prescribed disciplinary procedure was
followed. We, therefore, agree with the Labor Arbiter’s finding that POMI utterly failed to
establish its claim of valid dismissal. Accordingly, the NLRC and Court of Appeals erred
in reversing the said finding. [De Jesus vs. National Labor Relations Commission, 530
SCRA 489(2007)]
 Seagull Shipmanagement and Transport, Inc. vs. NLRC, 333 SCRA 236 , June 08,
2000
Remedial Law; Certiorari; The filing of a motion for reconsideration is a condition sine
qua non to the institution of a special civil action for certiorari, subject to well-recognized
exceptions; Certiorari cannot be resorted to as a shield from the adverse consequences
of petitioners’ own omission to file the required motion for reconsideration.

Labor Law; Death Benefits; Under the contract, compensability of the illness or death of
seamen need not depend on whether the illness was work connected or not; It is
sufficient that the illness occurred during the term of the employment contract.—It will
be noted that the claim for sickness and permanent disability benefits of the private
respondent arose from the stipulations on the standard format contract of employment
between him and petitioner Seagull per Circular No. 2, Series of 1984 of POEA. This
circular was intended for all parties involved in the employment of Filipino seamen on
board any ocean-going vessel. Significantly, under the contract, compensability of the
illness or death of seamen need not depend on whether the illness was work connected
or not. It is sufficient that the illness occurred during the term of the employment
contract. It will also be recalled that petitioners admitted that private respondent’s work
as a radio officer exposed him to different climates and unpredictable weather, which
could trigger a heart attack or heart failure.

Same; Same; It is not necessary, in order to recover compensation, that the employee
must have been in perfect health at the time he contracted the disease; If the disease is
the proximate cause of the employee’s death for which compensation is sought, the
previous physical condition of the employee is unimportant, and recovery may be had
for said death, independently of any pre-existing disease.—Even assuming that the
ailment of the worker was contracted prior to his employment, this still would not deprive
him of compensation benefits. For what matters is that his work had contributed, even in
a small degree, to the development of the disease and in bringing about his eventual
death. Neither is it necessary, in order to recover compensation, that the employee
must have been in perfect health at the time he contracted the disease. A worker brings
with him possible infirmities in the course of his employment, and while the employer is
not the insurer of the health of the employees, he takes them as he finds them and
assumes the risk of liability. If the disease is the proximate cause of the employee’s
death for which compensation is sought, the previous physical condition of the
employee is unimportant, and recovery may be had for said death, independently of any
pre-existing disease. [Seagull Shipmanagement and Transport, Inc. vs. NLRC, 333
SCRA 236(2000)]

Prudential Shipping and Management Corporation vs. Sta. Rita, 515 SCRA 157 ,
February 08, 2007
Labor Law; Seamen; The death of a seaman during the term of employment makes the
employer liable to his heirs for death compensation benefits, but if the seaman dies after
the termination of his contract of employment, his beneficiaries are not entitled to the
death benefits.—The death of a seaman during the term of employment makes the
employer liable to his heirs for death compensation benefits. Once it is established that
the seaman died during the effectivity of his employment contract, the employer is
liable. However, if the seaman dies after the termination of his contract of employment,
his beneficiaries are not entitled to the death benefits enumerated above. [Prudential
Shipping and Management Corporation vs. Sta. Rita, 515 SCRA 157(2007)]

People vs. Turda, 233 SCRA 702, July 06, 1994

Labor Law; Illegal Recruitment; Words and Phrases; Recruitment, defined.—Article 13,
par. (b), of the same Code defines recruitment as “any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring or procuring workers, and includes referrals,
contract services, promising or advertising for employment, locally or abroad, whether
for profit or not; provided, that any person or entity which, in any manner, offers or
promises for a fee employment to two or more persons shall be deemed engaged in
recruitment and placement.”
Same; Same; Conspiracy; The appellant, his wife, and Manera were conspirators in the
illegal recruitment business by contributing acts in pursuance of the financial success of
their joint venture for their mutual benefit.—A review of the testimonies of complainants
leads us to no other conclusion than that appellant, his wife, and Manera were
conspirators in the illegal recruitment business by contributing acts in pursuance of the
financial success of their joint venture for their mutual benefit. All the complainants have
testified that in every recruitment transaction, appellant was always present with the
other accused. With respect to the recruitment of Rosales and Shirley Cabalu, both
testified that the three (3) accused went to their house to induce them to apply for
overseas work for a fee, and that appellant was likewise around when the amount of
P70,000.00 was quoted by the other accused as the recruitment service fee. For her
part, complainant Celina Andan categorically testified that appellant and his wife were
together when the latter was paid the downpayment in check for her trip to Canada.
Celina further asserted that the Turdas were always together in their recruitment
transactions; in fact, all the complainants confirmed that appellant even drove them to
the airport for the supposed trip abroad not only once but thrice.
Same; Same; Evidence; A self-serving negative evidence cannot prevail over positive
identification.—Appellant’s explanation that his reason for driving the complainants to
the airport was because he himself was also scheduled to leave for abroad, is weak and
uncorroborated. It is a self-serving negative evidence which cannot prevail over his
positive identification by the complaining witnesses as one of those who actively
participated in recruiting them. Besides, how could he be driving his Volkswagen to the
airport if he himself was leaving for abroad, unless he was ready to abandon his car
after taking off?
Same; Same; Same; Witnesses; The findings of the trial court on the credibility of
witnesses are entitled to the highest degree of respect and will not be disturbed on
appeal in the absence of any showing that said court overlooked, misunderstood, or
misapplied some facts or circumstances of weight and substance.—The findings of the
trial court on the credibility of witnesses are entitled to the highest degree of respect and
will not be disturbed on appeal in the absence of any showing that said court
overlooked, misunderstood or misapplied some facts or circumstances of weight and
substance which do not obtain in the present case. There is no doubt that the acts of
appellant and his wife conclusively established a common criminal design mutually
deliberated upon and accomplished through coordinated moves. Such acts constitute
enlisting, contracting or procuring workers or promising them overseas employment
under Art. 13, par. (b), of the Labor Code. Since appellant did not have the license or
authority to recruit and yet recruited at least three (3) persons, he is guilty of large-scale
illegal recruitment under Art. 38, penalized under Art. 39, of the Labor Code.
Same; Same; Constitutional Law; Bill of Rights; Ex Post Facto Laws; P.D. 2018, which
increased the penalty for illegal recruitment constitutive of economic sabotage, to life
imprisonment, took effect on 28 July 1986.—We are not persuaded by appellant’s
argument that the trial court erred in imposing upon him the penalty of life imprisonment
because this was imposed by a new law not in force when the offense was allegedly
committed. P.D. No. 2018 has increased the penalty to life imprisonment if the illegal
recruitment constitutes economic sabotage. As defined in Art. 38, as amended, illegal
recruitment constitutes economic sabotage if undertaken by a group of three (3) or more
persons conspiring and/or confederating with one another in carrying out any unlawful
or illegal transaction, enterprise or scheme defined under the first paragraph of Art. 38.
As correctly pointed out by the Solicitor General, Sec. 2 of P.D. No. 2018, promulgated
on 26 January 1986, has provided for its immediate effectivity. It was published on 10
February 1986 in Vol. 82, No. 6, Page 922, of the Official Gazette. Hence, when
appellant committed the acts of illegal recruitment from August 1986 to September
1987, the amendments to the law, which took effect on 28 July 1986, were already in
force and effect.

Same; Same; Same; Same; Double Jeopardy; Where some other crimes or felonies are
committed in the process of illegal recruitment, conviction under the Labor Code does
not preclude punishment under other statutes.—The rule is settled that the recruitment
of persons for overseas employment without the necessary recruiting permit or authority
from the POEA constitutes illegal recruitment; however, where some other crimes or
felonies are committed in the process, conviction under the Labor Code does not
preclude punishment under other statutes.

Same; Same; Same; Same; Same; Estafa; Not all acts which constitute estafa
necessarily establish illegal recruitment, for estafa is wider in scope and covers deceits
whether or not related to recruitment activities.—Applying the foregoing principle, not all
acts which constitute estafa necessarily establish illegal recruitment, for estafa is wider
in scope and covers deceits whether or not related to recruitment activities. More
importantly, the element of damage, which is essential in estafa cases, is immaterial in
illegal recruitment; and, while estafa is malum in se, illegal recruitment is malum
prohibitum. [People vs. Turda, 233 SCRA 702(1994)]

Prieto vs. National Labor Relations Commission, 226 SCRA 232 , September 10,
1993
Labor Law; Appeal; Factual findings of administrative bodies are as a rule binding on
the Court unless they come under the established exceptions.—The factual findings of
administrative bodies are as a rule binding on this Court, but this is true only when they
do not come under the established exceptions. One of these is where the findings of the
POEA and the NLRC are contrary to each other, as in this case, and there is a
necessity to determine which of them should be preferred as more conformable to the
established facts.
Same; The claims of our overseas workers should be received with sympathy and
allowed if warranted conformably to the constitutional mandate for the protection of the
working class.—The private respondents point to the petitioners’ allegation in their
complaint that they were mere assistant cooks and argue that this belies their
representation that they did not apply for these positions. The argument has no merit.
The petitioners were not assisted by lawyers when they filed their complaint and must
have had in mind the positions stipulated in the second contract. In the amended
complaint, this statement was rectified. At any rate, the slight error must not be taken
against the petitioners. As we held in Cuadra v. NLRC, “our overseas workers are
mostly ordinary laborers not conversant with legal principles and with the manner they
can assert and protect rights. They have no compatriot lawyers to consult and no labor
unions to support them in the foreign land. x x x The claims of our overseas workers
should therefore be received with sympathy and allowed, if warranted, conformably to
the constitutional mandate for the protection of the working class.”
Same; Same; Where the employer-employee relationship has been established, the
burden of proof in termination cases lies with the employer.—Where the employer-
employee relationship has been established, the burden of proof in termination cases
lies with the employer. This burden was not discharged by the private respondents.

Same; Labor Code; A private employment agency can be sued jointly and severally with
the principal or foreign-based employer for any violation of the recruitment agreement or
the contract of employment.—Rule V, Book I of the Omnibus Rules Implementing the
Labor Code defines the duties and obligations of a duly licensed placement and
recruitment agency. Section 2(e) requires a private employment agency to assume all
responsibilities for the implementation of the contract of employment of an overseas
worker. Section 10(a)(2) provides that a private employment agency can be sued jointly
and severally with the principal or foreign-based employer for any violation of the
recruitment agreement or the contract of employment.
Same; Same; Same; Book II, Rule II, Section 1(f) (3) of the New Rules and Regulations
Governing Overseas Employment, promulgated by the Governing Board of the POEA
substantially reiterates Rule II of Book II, Section 1(d) (3) of 1985 POEA Rules.—Book
II, Rule II, Section I(f) (3) of the new Rules and Regulations Governing Overseas
Employment promulgated by the Governing Board of the POEA substantially reiterates
Rule II of Book II, Section 1(d) (3) of 1985 POEA Rules, which governs this case. It
provides that a private employment agency shall assume joint and solidary liability with
the employer for all claims and liabilities that may arise in connection with the
implementation of the contracts including but not limited to payment of wages, health
and disability compensation and repatriation. There is no doubt that, under the facts
established in this case, AR and Sons is jointly and solidarily liable with overseas
employer SAM for the claims of the petitioners.
 JMM Promotion and Management, Inc. vs. Court of Appeals, 260 SCRA 319 ,
August 05, 1996
Same; Same; Police power concerns government enactments which precisely interfere
with personal liberty or property in order to promote the general welfare or the common
good.—Thus, police power concerns government enactments which precisely interfere
with personal liberty or property in order to promote the general welfare or the common
good. As the assailed Department Order enjoys a presumed validity, it follows that the
burden rests upon petitioners to demonstrate that the said order, particularly, its ARB
requirement, does not enhance the public welfare or was exercised arbitrarily or
unreasonably.
Same; Same; The Artist Record Book requirement and the questioned Department
Order related to its issuance were issued by the Secretary of Labor pursuant to a valid
exercise of the police power.—A thorough review of the facts and circumstances
leading to the issuance of the assailed orders compels us to rule that the Artist Record
Book requirement and the questioned Department Order related to its issuance were
issued by the Secretary of Labor pursuant to a valid exercise of the police power.
Same; Same; The welfare of Filipino performing artists, particularly the women was
paramount in the issuance of Department Order No. 3.—Clearly, the welfare of Filipino
performing artists, particularly the women was paramount in the issuance of Department
Order No. 3. Short of a total and absolute ban against the deployment of performing
artists to “high-risk” destinations, a measure which would only drive recruitment further
underground, the new scheme at the very least rationalizes the method of screening
performing artists by requiring reasonable educational and artistic skills from them and
limits deployment to only those individuals adequately prepared for the unpredictable
demands of employment as artists abroad. It cannot be gainsaid that this scheme at
least lessens the room for exploitation by unscrupulous individuals and agencies.

Same; Same; Apart from the State’s police power, the Constitution itself mandates
government to extend the fullest protection to our overseas workers.—In any event,
apart from the State’s police power, the Constitution itself mandates government to
extend the fullest protection to our overseas workers. The basic constitutional statement
on labor, embodied in Section 18 of Article II of the Constitution provides: Sec. 18. The
State affirms labor as a primary social economic force. It shall protect the rights of
workers and promote their welfare. More emphatically, the social justice provision on
labor of the 1987 Constitution in its first paragraph states: The State shall afford full
protection to labor, local and overseas, organized and unorganized and promote full
employment and equality of employment opportunities for all.

Same; Same; Protection to labor does not indicate promotion of employment alone.—
Obviously, protection to labor does not indicate promotion of employment alone. Under
the welfare and social justice provisions of the Constitution, the promotion of full
employment, while desirable, cannot take a backseat to the government’s constitutional
duty to provide mechanisms for the protection of our workforce, local or overseas.

Same; Same; A profession, trade or calling is a property right within the meaning of our
constitutional guarantees.—A profession, trade or calling is a property right within the
meaning of our constitutional guarantees. One cannot be deprived of the right to work
and the right to make a living because these rights are property rights, the arbitrary and
unwarranted deprivation of which normally constitutes an actionable wrong.

Same; Same; No right is absolute, and the proper regulation of a profession, calling,
business or trade has always been upheld as a legitimate subject of a valid exercise of
the police power by the state.—Nevertheless, no right is absolute, and the proper
regulation of a profession, calling, business or trade has always been upheld as a
legitimate subject of a valid exercise of the police power by the state particularly when
their conduct affects either the execution of legitimate governmental functions, the
preservation of the State, the public health and welfare and public morals. According to
the maxim, sic utere tuo ut alienum non laedas, it must of course be within the
legitimate range of legislative action to define the mode and manner in which every one
may so use his own property so as not to pose injury to himself or others.

Same; Same; So long as professionals and other workers meet reasonable regulatory
standards no such deprivation exists.—Locally, the Professional Regulation
Commission has begun to require previously licensed doctors and other professionals
to furnish documentary proof that they had either re-trained or had undertaken
continuing education courses as a requirement for renewal of their licenses. It is not
claimed that these requirements pose an unwarranted deprivation of a property right
under the due process clause. So long as professionals and other workers meet
reasonable regulatory standards no such deprivation exists.

Same; Same; The equal protection clause of the Constitution does not forbid
classification for so long as such classification is based on real and substantial
differences having a reasonable relation to the subject of the particular legislation.—The
equal protection clause is directed principally against undue favor and individual or
class privilege. It is not intended to prohibit legislation which is limited to the object to
which it is directed or by the territory in which it is to operate. It does not require
absolute equality, but merely that all persons be treated alike under like conditions both
as to privileges conferred and liabilities imposed. We have held, time and again, that the
equal protection clause of the Constitution does not forbid classification for so long as
such classification is based on real and substantial differences having a reasonable
relation to the subject of the particular legislation. If classification is germane to the
purpose of the law, concerns all members of the class, and applies equally to present
and future conditions, the classification does not violate the equal protection guarantee.
[JMM Promotion and Management, Inc. vs. Court of Appeals, 260 SCRA 319(1996)]

Cadalin vs. POEA's Administrator, 238 SCRA 721 , December 05, 1994
Conflict of Laws; As a general rule, a foreign procedural law will not be applied in the
forum.

Same; Same; Actions; Words and Phrases; “Borrowing Statute,” Explained; One form of
“borrowing statutes” provides that an action barred by the laws of the place where it
accrued, will not be enforced in the forum even though the local statute has not run
against it.—However, the characterization of a statute into a procedural or substantive
law becomes irrelevant when the country of the forum has a “borrowing statute.” Said
statute has the practical effect of treating the foreign statute of limitation as one of
substance (Goodrich, Conflict of Laws 152-153 [1938]). A “borrowing statute” directs the
state of the forum to apply the foreign statute of limitations to the pending claims based
on a foreign law (Siegel, Conflicts 183 [1975]). While there are several kinds of
“borrowing statutes,” one form provides that an action barred by the laws of the place
where it accrued, will not be enforced in the forum even though the local statute has not
run against it (Goodrich and Scoles, Conflict of Laws, 152-153 [1938]). Section 48 of our
Code of Civil Procedure is of this kind. Said Section provides: “If by the laws of the state
or country where the cause of action arose, the action is barred, it is also barred in the
Philippine Islands.”
Same; Same; Same; Section 48 of the Code of Civil Procedure has not been repealed
or amended by the Civil Code.—Section 48 has not been repealed or amended by the
Civil Code of the Philippines. Article 2270 of said Code repealed only those provisions
of the Code of Civil Procedure as to which were inconsistent with it. There is no
provision in the Civil Code of the Philippines, which is inconsistent with or contradictory
to Section 48 of the Code of Civil Procedure (Paras, Philippine Conflict of Laws, 104
[7th ed.]).
Same; Same; Labor Law; The courts of the forum will not enforce any foreign claim
obnoxious to the forum’s public policy.—In the light of the 1987 Constitution, however,
Section 48 cannot be enforced ex proprio vigore insofar as it ordains the application in
this jurisdiction of Section 156 of the Amiri Decree No. 23 of 1976. The courts of the
forum will not enforce any foreign claim obnoxious to the forum’s public policy
(Canadian Northern Railway Co. v. Eggen, 252 U.S. 553, 40 S. Ct. 402, 64 L. ed. 713
[1920]). To enforce the one-year prescriptive period of the Amiri Decree No. 23 of 1976
as regards the claims in question would contravene the public policy on the protection to
labor.
Labor Law; Overseas Contract Workers; Prescription; Article 291 of the Labor Code
applies to money claims arising from employer-employee relations, including those
arising from application of foreign laws providing for greater employee benefits.—
Section 7-a of the Eight-Hour Labor Law provides the prescriptive period for filing
“actions to enforce any cause of action under said law.” On the other hand, Article 291
of the Labor Code of the Philippines provides the prescriptive period for filing “money
claims arising from employer-employee relations.” The claims in the cases at bench all
arose from the employer employee relations, which is broader in scope than claims
arising from a specific law or from the collective bargaining agreement. The contention
of the POEA Administrator, that the three-year prescriptive period under Article 291 of
the Labor Code of the Philippines applies only to money claims specifically recoverable
under said Code, does not find support in the plain language of the provision. Neither is
the contention of the claimants in G.R. No. 104911-14 that said Article refers only to
claims “arising from the employer’s violation of the employee’s right,” as provided by the
Labor Code supported by the facial reading of the provision.

Same; Same; Right to Speedy Disposition of Cases; “Speedy disposition of cases” is a

relative term, a flexible concept consistent with delays and depends upon the
circumstances of each case.—It is true that the constitutional right to “a speedy
disposition of cases” is not limited to the accused in criminal proceedings but extends to
all parties in all cases, including civil and administrative cases, and in all proceedings,
including judicial and quasi-judicial hearings. Hence, under the Constitution, any party to
a case may demand expeditious action on all officials who are tasked with the
administration of justice. However, as held in Caballero v. Alfonso, Jr., 153 SCRA 153
(1987), “speedy disposition of cases” is a relative term. Just like the constitutional
guarantee of “speedy trial” accorded to the accused in all criminal proceedings, “speedy
disposition of cases” is a flexible concept. It is consistent with delays and depends upon
the circumstances of each case. What the Constitution prohibits are unreasonable,
arbitrary and oppressive delays which render rights nugatory.
Same; Same; Same; Even if the cases took seven years to be disposed of in the
administrative level there is no violation of the constitutional right to speedy disposition
of cases where the cases are not of the run-of-the-mill variety, involve a total of 1,767
claimants hired on various dates, with claims totalling more than US$65 million.—The
cases at bench are not of the run-of-the-mill variety, such that their final disposition in
the administrative level after seven years from their inception, cannot be said to be
attended by unreasonable, arbitrary and oppressive delays as to violate the
constitutional rights to a speedy disposition of the cases of complainants. The amended
complaint filed on June 6, 1984 involved a total of 1,767 claimants. Said complaint had
undergone several amendments, the first being on April 3, 1985. The claimants were
hired on various dates from 1975 to 1983. They were deployed in different areas, one
group in and the other groups outside of, Bahrain. The monetary claims totalled more
than US$65 million.

Same; Same; Labor Law; The courts of the forum will not enforce any foreign claim
obnoxious to the forum’s public policy.—In the light of the 1987 Constitution, however,
Section 48 cannot be enforced ex proprio vigore insofar as it ordains the application in
this jurisdiction of Section 156 of the Amiri Decree No. 23 of 1976. The courts of the
forum will not enforce any foreign claim obnoxious to the forum’s public policy
(Canadian Northern Railway Co. v. Eggen, 252 U.S. 553, 40 S. Ct. 402, 64 L. ed. 713
[1920]). To enforce the one-year prescriptive period of the Amiri Decree No. 23 of 1976
as regards the claims in question would contravene the public policy on the protection to
labor.

Labor Law; Overseas Contract Workers; Prescription; Article 291 of the Labor Code
applies to money claims arising from employer-employee relations, including those
arising from application of foreign laws providing for greater employee benefits.—
Section 7-a of the Eight-Hour Labor Law provides the prescriptive period for filing
“actions to enforce any cause of action under said law.” On the other hand, Article 291
of the Labor Code of the Philippines provides the prescriptive period for filing “money
claims arising from employer-employee relations.” The claims in the cases at bench all
arose from the employer- employee relations, which is broader in scope than claims
arising from a specific law or from the collective bargaining agreement. The contention
of the POEA Administrator, that the three-year prescriptive period under Article 291 of
the Labor Code of the Philippines applies only to money claims specifically recoverable
under said Code, does not find support in the plain language of the provision. Neither is
the contention of the claimants in G.R. No. 104911-14 that said Article refers only to
claims “arising from the employer’s violation of the employee’s right,” as provided by the
Labor Code supported by the facial reading of the provision.

Nitto Enterprises vs. National Labor Relations Commission, 248 SCRA 654 ,
September 29, 1995
Labor Law; Apprenticeship Agreements; Prior approval by the Department of Labor and
Employment of the proposed apprenticeship program is a condition sine qua non before
an apprenticeship agreement can be validly entered into.—In the case at bench, the
apprenticeship agreement between petitioner and private respondent was executed on
May 28, 1990 allegedly employing the latter as an apprentice in the trade of “care
maker/molder.” On the same date, an apprenticeship program was prepared by
petitioner and submitted to the Department of Labor and Employment. However, the
apprenticeship Agreement was filed only on June 7, 1990. Notwithstanding the absence
of approval by the Department of Labor and Employment, the apprenticeship agreement
was enforced the day it was signed. Based on the evidence before us, petitioner did not
comply with the requirements of the law. It is mandated that apprenticeship agreements
entered into by the employer and apprentice shall be entered only in accordance with
the apprenticeship program duly approved by the Minister of Labor and Employment.
Prior approval by the Department of Labor and Employment of the proposed
apprenticeship program is, therefore, a condition sine qua non before an apprenticeship
agreement can be validly entered into.

Same; Same; Where the apprenticeship agreement has no force and effect, the worker
hired as apprentice should be considered as a regular employee.—Hence, since the
apprenticeship agreement between petitioner and private respondent has no force and
effect in the absence of a valid apprenticeship program duly approved by the DOLE,
private respondent’s assertion that he was hired not as an apprentice but as a delivery
boy (“kargador” or “pahinante”) deserves credence. He should rightly be considered as
a regular employee of petitioner as defined by Article 280 of the Labor Code.

Same; Dismissals; Due Process; The twin requirements of due process, substantive
and procedural, must be complied with before valid dismissal exists, otherwise the
dismissal becomes void.—There is an abundance of cases wherein the Court ruled that
the twin requirements of due process, substantive and procedural, must be complied
with, before valid dismissal exists. Without which, the dismissal becomes void. The twin
requirements of notice and hearing constitute the essential elements of due process.
This simply means that the employer shall afford the worker ample opportunity to be
heard and to defend himself with the assistance of his representative, if he so desires.
Ample opportunity connotes every kind of assistance that management must accord the
employee to enable him to prepare adequately for his defense including legal
representation. [Nitto Enterprises vs. National Labor Relations Commission, 248 SCRA
654(1995)].
Note: The above list of cases was obtained from NLRC Commissioner Rendoque's lecture.
--

ESTATE OF NELSON R. DULAY, represented by his wife MERRIDY JA

NE P. DULAY ABOITIZ JEBSEN MARITIME, INC. and GENERAL CHAR
TERERS, INC. G.R. No. 172642, 13 June 2012
FACTS:

Nelson R. Dulay was employed by General Charterers Inc. (GCI), a subsidiary of co-
petitioner Aboitiz Jebsen Maritime Inc. 25 days after the completion of his employment
contract, Nelson died due to acute renal failure secondary to septicemia. At the time of h
is death, Nelson was a bona fide member of the Associated Marine Officers and Seaman’
s Union of the Philippines (AMOSUP), GCI’s collective bargaining agent. Nelson’s wido
w, Merridy Jane, thereafter claimed for death benefits through the grievance procedure
of the CBA between AMOSUP and GCI. However, the grievance procedure was “declare
d deadlocked” as petitioners refused to grant the benefits sought by the widow. The wife
then filed a complaint with the NLRC Sub-
Regional Arbitration against GCI for death and medical benefits and damages. Nelson’s
brother, only received P20,000.00 from respondents pursuant to the CBA. Merridy Jan
e contended that she is entitled to the aggregate sum of $90,000.00 instead.

The CA ruled that while the suit filed by Merridy Jane is a money claim, the same basical
ly involves the interpretation and application of the provisions in the subject CBA. As su
ch, jurisdiction belongs to the voluntary arbitrator and not the labor arbiter.

ISSUE:

Whether or not claim for death benefits of an overseas employee should be with the Lab
or Arbiter considering that such granting involves interpretation and application of the
provisions in the CBA.

RULING:

No. The Supreme Court held that it is true that R.A. 8042 is a special law governing over
seas Filipino workers. However, a careful reading of this special law would readily show
that there is no specific provision thereunder which provides for jurisdiction over disput
es or unresolved grievances regarding the interpretation or implementation of a CBA. Se
ction 10 of R.A. 8042, which is cited by petitioner, simply speaks, in general, of “claims a
rising out of an employer-
employee relationship or by virtue of any law or contract involving Filipino workers for
overseas deployment including claims for actual, moral, exemplary and other forms of d
amages.” On the other hand, Articles 217(c) and 261 of the Labor Code are very specific i
n stating that voluntary arbitrators have jurisdiction over cases arising from the interpre
tation or implementation of collective bargaining agreements. Stated differently, the inst
ant case involves a situation where the special statute (R.A. 8042) refers to a subject in g
eneral, which the general statute (Labor Code) treats in particular.

Furthermore, Article 13.1 of the CBA provides that in case of dispute or conflict in the int
erpretation or application of any of the provisions of this Agreement, or enforcement of
Company policies, the same shall be settled through negotiation, conciliation or volunta
ry arbitration. Therefore, it is clear that the parties, in the first place, really intended to b
ring to conciliation or voluntary arbitration any dispute or conflict in the interpretation
or application of the provisions of their CBA. It is settled that when the parties have vali
dly agreed on a procedure for resolving grievances and to submit a dispute to voluntary
arbitration then that procedure should be strictly observed.

[G.R. NO. 183335 : December 23, 2009]

JUANITO TABIGUE, ALEX BIBAT, JECHRIS DASALLA, ANTONIO TANGON, ROLANDO PEDRIGAL,
DANTE MAUL, ALFREDO IDUL, EDGAR RAMOS, RODERICK JAVIER, NOEL PONAYO, ROMEL ORAPA,
REY JONE, ALMA PATAY, JERIC BANDIGAN, DANILO JAYME, ELENITA S. BELLEZA, JOSEPHINE
COTANDA, RENE DEL MUNDO, PONCIANO ROBUCA, and MARLON
MADICLUM,Petitioners, v. INTERNATIONAL COPRA EXPORT CORPORATION (INTERCO), Respondent.

DECISION

CARPIO MORALES, J.:

Petitioner Juanito Tabigue and his 19 co-petitioners, all employees of respondent International Copra Export
Corp-oration (INTERCO), filed a Notice of Preventive Mediation with the Department of Labor and
Employment - National Conciliation and Mediation Board (NCMB), Regional Branch No. XI, Davao City
against respondent, for violation of Collective Bargaining Agreement (CBA) and failure to sit on the
grievance conference/meeting.1

As the parties failed to reach a settlement before the NCMB, petitioners requested to elevate the case to
voluntary arbitration. The NCMB thus set a date for the parties to agree on a Voluntary Arbitrator.

Before the parties could finally meet, respondent presented before the NCMB a letter2 of Genaro Tan (Tan),
president of the INTERCO Employees/Laborers' Union (the union) of which petitioners are members,
addressed to respondent's plant manager Engr. Paterno C. Tangente (Tangente), stating that petitioners
"are not duly authorized by [the] board or the officers to represent the union, [hence] . . . all actions,
representations or agreements made by these people with the management will not be honored or
recognized by the union." Respondent thus moved to dismiss petitioners' complaint for lack of jurisdiction.3

Petitioners soon sent union president Tan and respondent's plant manager Tangente a Notice to Arbitrate,
citing the "Revised Guidelines" in the Conduct of Voluntary Arbitration Procedure vis a vis Section 3, Article
XII of the CBA, furnishing the NCMB with a copy4 thereof, which notice respondent opposed.5
The parties having failed to arrive at a settlement,6 NCMB Director Teodorico O. Yosores wrote petitioner
Alex Bibat and respondent's plant manager Tangente of the lack of willingness of both parties to submit to
voluntary arbitration, which willingness is a pre-requisite to submit the case thereto; and that under the CBA
forged by the parties, the union is an indispensable party to a voluntary arbitration but that since Tan
informed respondent that the union had not authorized petitioners to represent it, it would be absurd to
bring the case to voluntary arbitration.

The NCMB Director thus concluded that "the demand of [petitioners] to submit the issues . . . to voluntary
arbitration CAN NOT BE GRANTED." He thus advised petitioners to avail of the compulsory arbitration
process to enforce their rights.7

On petitioners' Motion for Reconsideration,8 the NCMB Director, by letter of April 11, 2007 to petitioners'
counsel, stated that the NCMB "has no rule-making power to decide on issues [as it] only facilitates
settlement among the parties to . . . labor disputes."

Petitioners thus assailed the NCMB Director's decision via Petition for Review before the Court of
Appeals9which dismissed it by Resolution10 of October 24, 2007 in this wise:

xxx

Considering that NCMB is not a quasi-judicial agency exercising quasi-judicial functions but merely a
conciliatory body for the purpose of facilitating settlement of disputes between parties, its decisions or that
of its authorized officer cannot be appealed either through a Petition for Review under Rule 43 or under Rule
65 of the Revised Rules of Court.

Further perusal of the petition reveals the following infirmities:

1. Payment of the docket fees and other legal fees is short by One Thousand Pesos (Php 1,000.00);

2. Copy of the assailed "Decision" of the Regional Director of the National Conciliation and Mediation Board
has not been properly certified as the name and designation of the certifying officer thereto are not
indicated; and cralawl ibra ry

3. Not all of the petitioners named in the petition signed the verification and non-forum
shopping.11 (emphasis and underscoring supplied)

Their Motion for Reconsideration12 having been denied,13 petitioners filed the present Petition for Review on
Certiorari,14 raising the following arguments:

THIS PARTICULAR CASE XXX FALLS SQUARELY WITHIN THE PURVIEW OF SECTION 6, RULE IV, IN
RELATION TO PARAGRAPH 3, SUB-PARAGRAPH 3.2, SECTION 4, RULE IV, ALL OF THE REVISED
PROCEDURAL GUIDELINES IN THE CONDUCT OF VOLUNTARY ARBITRATION PROCEEDINGS.15

THE NCMB, WHEN EXERCISING ADJUDICATIVE POWERS, ACTS AS A QUASI-JUDICIAL AGENCY.16

FINAL JUDGMENTS, DECISIONS, RESOLUTIONS, ORDERS, OR AWARDS OF REGIONAL TRIAL COURTS AND
QUASI-JUDICIAL BOARDS, LIKE THE NCMB, COMMISSIONS, AGENCIES, INSTRUMENTALITIES, ARE
APPEALABLE BY PETITION FOR REVIEW TO THE COURT OF APPEALS.17 (emphasis in the original)

LABOR CASES, AS A GENERAL RULE, ARE NEVER RESOLVED ON THE BASIS OF TECHNICALITY ESPECIALLY
SO WHEN SUBSTANTIAL RIGHTS OF EMPLOYEES ARE AFFECTED.18 (emphasis and underscoring supplied)

The petition fails.

Section 7 of Rule 43 of the Rules of Court provides that

[t]he failure of the petitioner to comply with any of the foregoing requirements regarding the payment of the
docket and other lawful fees, the deposit for costs, proof of service of the petition, and the contents of and
the documents which should accompany the petition shall be sufficient ground for the dismissal thereof.
(underscoring and emphasis supplied)

Petitioners claim that they had completed the payment of the appellate docket fee and other legal fees when
they filed their motion for reconsideration before the Court of Appeals.19 While the Court has, in the interest
of justice, given due course to appeals despite the belated payment of those fees,20petitioners have not
proffered any reason to call for a relaxation of the above-quoted rule. On this score alone, the dismissal by
the appellate court of petitioners' petition is in order.

But even if the above-quoted rule were relaxed, the appellate court's dismissal would just the same be
sustained. Under Section 9 (3) of the Judiciary Reorganization Act of 1980,21 the Court of Appeals exercises
exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of Regional
Trial Courts and quasi-judicial agencies, instrumentalities, boards or commissions.

Rule 43 of the Rules of Court under which petitioners filed their petition before the Court of Appeals22applies
to awards, judgments, final orders or resolutions of or authorized by any quasi-judicial agency in the
exercise of its quasi-judicial functions.23

A[n agency] is said to be exercising judicial function where [it] has the power to determine what the law is
and what the legal rights of the parties are, and then undertakes to determine these questions and
adjudicate upon the rights of the parties. Quasi-judicial function is a term which applies to the action,
discretion, etc. of public administrative officers or bodies, who are required to investigate facts or ascertain
the existence of facts, hold hearings, and draw conclusions from them as a basis for their official action and
to exercise discretion of a judicial nature.24 (underscoring supplied)

Given NCMB's following functions, as enumerated in Section 22 of Executive Order No. 126 (the
Reorganization Act of the Ministry of Labor and Employment), viz:

(a) Formulate policies, programs, standards, procedures, manuals of operation and guidelines pertaining to
effective mediation and conciliation of labor disputes;

(b) Perform preventive mediation and conciliation functions;

(c) Coordinate and maintain linkages with other sectors or institutions, and other government authorities
concerned with matters relative to the prevention and settlement of labor disputes;

(d) Formulate policies, plans, programs, standards, procedures, manuals of operation and guidelines
pertaining to the promotion of cooperative and non-adversarial schemes, grievance handling, voluntary
arbitration and other voluntary modes of dispute settlement;

(e) Administer the voluntary arbitration program; maintain/update a list of voluntary arbitrations; compile
arbitration awards and decisions;

(f) Provide counseling and preventive mediation assistance particularly in the administration of collective
agreements;

(g) Monitor and exercise technical supervision over the Board programs being implemented in the regional
offices; andcralawli bra ry

(h) Perform such other functions as may be provided by law or assigned by the Minister,

it can not be considered a quasi-judicial agency.

Respecting petitioners' thesis that unsettled grievances should be referred to voluntary arbitration as called
for in the CBA, the same does not lie. The pertinent portion of the CBA reads:
In case of any dispute arising from the interpretation or implementation of this Agreement or any matter
affecting the relations of Labor and Management, the UNION and the COMPANY agree to exhaust all
possibilities of conciliation through the grievance machinery. The committee shall resolve all problems
submitted to it within fifteen (15) days after the problems ha[ve] been discussed by the members. If the
dispute or grievance cannot be settled by the Committee, or if the committee failed to act on the matter
within the period of fifteen (15) days herein stipulated, the UNION and the COMPANY agree to submit the
issue to Voluntary Arbitration. Selection of the arbitrator shall be made within seven (7) days from the date
of notification by the aggrieved party. The Arbitrator shall be selected by lottery from four (4) qualified
individuals nominated by in equal numbers by both parties taken from the list of Arbitrators prepared by the
National Conciliation and Mediation Board (NCMB). If the Company and the Union representatives within ten
(10) days fail to agree on the Arbitrator, the NCMB shall name the Arbitrator. The decision of the Arbitrator
shall be final and binding upon the parties. However, the Arbitrator shall not have the authority to change
any provisions of the Agreement. The cost of arbitration shall be borne equally by the
parties.25 (capitalization in the original, underscoring supplied)
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