G.R. No.

L-63915 December 29, 1986

LORENZO M. TAÑ;ADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF ATTORNEYS FOR

BROTHERHOOD, INTEGRITY AND NATIONALISM, INC. (MABINI), petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President, HON.
JOAQUIN VENUS, in his capacity as Deputy Executive Assistant to the President,
MELQUIADES P. DE LA CRUZ, ETC., ET AL.,respondents.

RESOLUTION

CRUZ, J.:

Due process was invoked by the petitioners in demanding the disclosure of a number of
presidential decrees which they claimed had not been published as required by law. The
government argued that while publication was necessary as a rule, it was not so when it was
"otherwise provided," as when the decrees themselves declared that they were to become
effective immediately upon their approval. In the decision of this case on April 24, 1985, the
Court affirmed the necessity for the publication of some of these decrees, declaring in the
dispositive portion as follows:

WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all
unpublished presidential issuances which are of general application, and unless so published,
they shall have no binding force and effect.

The petitioners are now before us again, this time to move for reconsideration/clarification of
that decision. 1Specifically, they ask the following questions:

1. What is meant by "law of public nature" or "general applicability"?

2. Must a distinction be made between laws of general applicability and laws which are not?

3. What is meant by "publication"?

4. Where is the publication to be made?

5. When is the publication to be made?

Resolving their own doubts, the petitioners suggest that there should be no distinction between
laws of general applicability and those which are not; that publication means complete
publication; and that the publication must be made forthwith in the Official Gazette. 2

In the Comment 3 required of the then Solicitor General, he claimed first that the motion was a
request for an advisory opinion and should therefore be dismissed, and, on the merits, that the
clause "unless it is otherwise provided" in Article 2 of the Civil Code meant that the publication
required therein was not always imperative; that publication, when necessary, did not have to
be made in the Official Gazette; and that in any case the subject decision was concurred in only
by three justices and consequently not binding. This elicited a Reply 4 refuting these
arguments. Came next the February Revolution and the Court required the new Solicitor
General to file a Rejoinder in view of the supervening events, under Rule 3, Section 18, of the
Rules of Court. Responding, he submitted that issuances intended only for the internal
administration of a government agency or for particular persons did not have to be 'Published;
that publication when necessary must be in full and in the Official Gazette; and that, however,
the decision under reconsideration was not binding because it was not supported by eight
members of this Court. 5

The subject of contention is Article 2 of the Civil Code providing as follows:

ART. 2. Laws shall take effect after fifteen days following the completion of their publication in
the Official Gazette, unless it is otherwise provided. This Code shall take effect one year after
such publication.

After a careful study of this provision and of the arguments of the parties, both on the original
petition and on the instant motion, we have come to the conclusion and so hold, that the clause
"unless it is otherwise provided" refers to the date of effectivity and not to the requirement of
publication itself, which cannot in any event be omitted. This clause does not mean that the
legislature may make the law effective immediately upon approval, or on any other date,
without its previous publication.

Publication is indispensable in every case, but the legislature may in its discretion provide that
the usual fifteen-day period shall be shortened or extended. An example, as pointed out by the
present Chief Justice in his separate concurrence in the original decision, 6 is the Civil Code
which did not become effective after fifteen days from its publication in the Official Gazette but
"one year after such publication." The general rule did not apply because it was "otherwise
provided. "

It is not correct to say that under the disputed clause publication may be dispensed with
altogether. The reason. is that such omission would offend due process insofar as it would deny
the public knowledge of the laws that are supposed to govern the legislature could validly
provide that a law e effective immediately upon its approval notwithstanding the lack of
publication (or after an unreasonably short period after publication), it is not unlikely that
persons not aware of it would be prejudiced as a result and they would be so not because of a
failure to comply with but simply because they did not know of its existence, Significantly, this
is not true only of penal laws as is commonly supposed. One can think of many non-penal
measures, like a law on prescription, which must also be communicated to the persons they
may affect before they can begin to operate.

We note at this point the conclusive presumption that every person knows the law, which of
course presupposes that the law has been published if the presumption is to have any legal
justification at all. It is no less important to remember that Section 6 of the Bill of Rights
recognizes "the right of the people to information on matters of public concern," and this
certainly applies to, among others, and indeed especially, the legislative enactments of the
government.

The term "laws" should refer to all laws and not only to those of general application, for strictly
speaking all laws relate to the people in general albeit there are some that do not apply to them
directly. An example is a law granting citizenship to a particular individual, like a relative of
President Marcos who was decreed instant naturalization. It surely cannot be said that such a
law does not affect the public although it unquestionably does not apply directly to all the
people. The subject of such law is a matter of public interest which any member of the body
politic may question in the political forums or, if he is a proper party, even in the courts of
justice. In fact, a law without any bearing on the public would be invalid as an intrusion of
privacy or as class legislation or as an ultra vires act of the legislature. To be valid, the law
must invariably affect the public interest even if it might be directly applicable only to one
individual, or some of the people only, and t to the public as a whole.

We hold therefore that all statutes, including those of local application and private laws, shall be
published as a condition for their effectivity, which shall begin fifteen days after publication
unless a different effectivity date is fixed by the legislature.

Covered by this rule are presidential decrees and executive orders promulgated by the
President in the exercise of legislative powers whenever the same are validly delegated by the
legislature or, at present, directly conferred by the Constitution. administrative rules and
regulations must a also be published if their purpose is to enforce or implement existing law
pursuant also to a valid delegation.
Interpretative regulations and those merely internal in nature, that is, regulating only the
personnel of the administrative agency and not the public, need not be published. Neither is
publication required of the so-called letters of instructions issued by administrative superiors
concerning the rules or guidelines to be followed by their subordinates in the performance of
their duties.

Accordingly, even the charter of a city must be published notwithstanding that it applies to only
a portion of the national territory and directly affects only the inhabitants of that place. All
presidential decrees must be published, including even, say, those naming a public place after a
favored individual or exempting him from certain prohibitions or requirements. The circulars
issued by the Monetary Board must be published if they are meant not merely to interpret but
to "fill in the details" of the Central Bank Act which that body is supposed to enforce.

However, no publication is required of the instructions issued by, say, the Minister of Social
Welfare on the case studies to be made in petitions for adoption or the rules laid down by the
head of a government agency on the assignments or workload of his personnel or the wearing
of office uniforms. Parenthetically, municipal ordinances are not covered by this rule but by the
Local Government Code.

We agree that publication must be in full or it is no publication at all since its purpose is to
inform the public of the contents of the laws. As correctly pointed out by the petitioners, the
mere mention of the number of the presidential decree, the title of such decree, its
whereabouts (e.g., "with Secretary Tuvera"), the supposed date of effectivity, and in a mere
supplement of the Official Gazette cannot satisfy the publication requirement. This is not even
substantial compliance. This was the manner, incidentally, in which the General Appropriations
Act for FY 1975, a presidential decree undeniably of general applicability and interest, was
"published" by the Marcos administration. 7 The evident purpose was to withhold rather than
disclose information on this vital law.

Coming now to the original decision, it is true that only four justices were categorically for
publication in the Official Gazette 8 and that six others felt that publication could be made
elsewhere as long as the people were sufficiently informed. 9 One reserved his vote 10 and
another merely acknowledged the need for due publication without indicating where it should be
made. 11 It is therefore necessary for the present membership of this Court to arrive at a clear
consensus on this matter and to lay down a binding decision supported by the necessary vote.

There is much to be said of the view that the publication need not be made in the Official
Gazette, considering its erratic releases and limited readership. Undoubtedly, newspapers of
general circulation could better perform the function of communicating, the laws to the people
as such periodicals are more easily available, have a wider readership, and come out regularly.
The trouble, though, is that this kind of publication is not the one required or authorized by
existing law. As far as we know, no amendment has been made of Article 2 of the Civil Code.
The Solicitor General has not pointed to such a law, and we have no information that it exists. If
it does, it obviously has not yet been published.

At any rate, this Court is not called upon to rule upon the wisdom of a law or to repeal or
modify it if we find it impractical. That is not our function. That function belongs to the
legislature. Our task is merely to interpret and apply the law as conceived and approved by the
political departments of the government in accordance with the prescribed procedure.
Consequently, we have no choice but to pronounce that under Article 2 of the Civil Code, the
publication of laws must be made in the Official Gazett and not elsewhere, as a requirement for
their effectivity after fifteen days from such publication or after a different period provided by
the legislature.

We also hold that the publication must be made forthwith or at least as soon as possible, to
give effect to the law pursuant to the said Article 2. There is that possibility, of course, although
not suggested by the parties that a law could be rendered unenforceable by a mere refusal of
the executive, for whatever reason, to cause its publication as required. This is a matter,
however, that we do not need to examine at this time.

Finally, the claim of the former Solicitor General that the instant motion is a request for an
advisory opinion is untenable, to say the least, and deserves no further comment.

The days of the secret laws and the unpublished decrees are over. This is once again an open
society, with all the acts of the government subject to public scrutiny and available always to
public cognizance. This has to be so if our country is to remain democratic, with sovereignty
residing in the people and all government authority emanating from them.

Although they have delegated the power of legislation, they retain the authority to review the
work of their delegates and to ratify or reject it according to their lights, through their freedom
of expression and their right of suffrage. This they cannot do if the acts of the legislature are
concealed.

Laws must come out in the open in the clear light of the sun instead of skulking in the shadows
with their dark, deep secrets. Mysterious pronouncements and rumored rules cannot be
recognized as binding unless their existence and contents are confirmed by a valid publication
intended to make full disclosure and give proper notice to the people. The furtive law is like a
scabbarded saber that cannot feint parry or cut unless the naked blade is drawn.

WHEREFORE, it is hereby declared that all laws as above defined shall immediately upon their
approval, or as soon thereafter as possible, be published in full in the Official Gazette, to
become effective only after fifteen days from their publication, or on another date specified by
the legislature, in accordance with Article 2 of the Civil Code. SO ORDERED.
 February 13, 2017 G.R. No. 190809

DE LA SALLE ARANETA UNIVERSITY, Petitioner vs. JUANITO c. BERNARDO, Respondent

LEONARDO-DE CASTRO, J.:

Before Us is a Petition for Review on Certiorari under Rule 45 of the Rules of Court filed by De
La Salle-Araneta University (DLS-AU) seeking the annulment and reversal of the Decision 1 dated
June 29, 2009 and Resolution2dated January 4, 2010 of the Court of Appeals in CA-G.R. SP No.
106399, which affirmed in toto the Decision3 of the National Labor Relations Commission (NLRC)
in NLRC NCR CA No. 043416-05. The NLRC reversed and set aside the Labor Arbiter's
Decision4 dated December 13, 2004 in NLRC NCR Case No. 00-02-02729-04 and found that
respondent Juanito C. Bernardo (Bernardo) was entitled to retirement benefits.

On February 26, 2004, Bernardo filed a complaint against DLS-AU and its owner/manager, Dr.
Oscar Bautista (Dr. Bautista), for the payment of retirement benefits. Bernardo alleged that he
started working as a part-time professional lecturer at DLS-AU (formerly known as the Araneta
University Foundation) on June 1, 1974 for an hourly rate of ₱20.00. Bernardo taught for two
semesters and the summer for the school year 1974-1975. Bernardo then took a leave of
absence from June 1, 197 5 to October 31, 1977 when he was assigned by the Philippine
Government to work in Papua New Guinea. When Bernardo came back in 1977, he resumed
teaching at DLS-AU until October '12, 2003, the end of the first semester for school year 2003-
2004. Bernardo's teaching contract was renewed at the start of every semester and summer.
However, on November 8, 2003, DLS-AU informed Bernardo through a telephone call that he
could not teach at the school anymore as the school was implementing the retirement age limit
for its faculty members. As he was already 75 years old, Bernardo had no choice but to retire.
At the time of his retirement, Bernardo was being paid ₱246.50 per hour.5

Bernardo immediately sought advice from the Department of Labor and Employment (DOLE)
regarding his entitlement to retirement benefits after 27 years of employment. In letters dated
January 20, 20046 and February 3, 2004,7 the DOLE, through its Public Assistance Center and
Legal Service Office, opined that Bernardo was entitled to receive benefits under Republic Act
No. 7641, otherwise known as the "New Retirement Law," and its Implementing Rules and
Regulations.

Yet, Dr. Bautista, in a letter 8 dated February 12, 2004, stated that Bernardo was not entitled to
any kind of separation pay or benefits. Dr. Bautista explained to Bernardo that as mandated by
the DLS-AU's policy and Collective Bargaining Agreement (CBA), only full-time permanent
faculty of DLS-AU for at least five years immediately preceeding the termination of their
employment could avail themselves of the postemployment benefits. As part-time faculty
member, Bernardo did not acquire permanent employment under the Manual of Regulations for
Private Schools, in relation to the Labor Code, regardless of his length of service.

Aggrieved by the repeated denials of his claim for retirement benefits, Bernardo filed before the
NLRC, National Capital Region, a complaint for non-payment of retirement benefits and
damages against DLS-AU and Dr. Bautista.

DLS-AU and Dr. Bautista averred that DLS-AU is a non-stock, non-profit educational institution
duly organized under Philippine laws, and Dr. Bautista was then its Executive Vice-President.
DLS-AU and Dr. Bautista countered that Bernardo was hired as a part-time lecturer at the
Graduate School of DLS-AU to teach Recent Advances in Animal Nutrition for the first semester
of school year 2003-2004. As stated in the Contract for Part-Time Faculty Member Semestral,
Bernardo bound himself to teach "for the period of one semester beginning June 9, 2003 to
October 12, 2003." The contract also provided that "this Contract shall automatically expire
unless expressly renewed in writing." 9 Prior contracts entered into between Bernardo and DLS-
AU essentially contained the same provisions. On November 8, 2003, DLS-AU informed
Bernardo that his contract would no longer be renewed. DLS-AU and Dr. Bautista were
surprised when they received a letter from Bernardo on February 18, 2004 claiming retirement
benefits and Summons dated February 26, 2004 from the NLRC in relation to Bernardo's
complaint.10

DLS-AU and Dr. Bautista maintained that Bernardo, as a part-time employee, was not entitled
to retirement benefits. The contract between DLS-AU and Bernardo was for a fixed
term, i.e., one semester. Contracts of employment for a fixed term are not proscribed by law,
provided that they had been entered into by the parties without any force, duress, or improper
pressure being brought to bear upon the employee and absent any other circumstance vitiating
consent. That DLS-AU no longer renewed Bernardo's contract did not necessarily mean that
Bernardo should be deemed retired from service.

DLS-AU and Dr. Bautista also contended that Bernardo, as a part-time employee, was not
entitled to retirement benefits pursuant to any retirement plan, CBA, or employment contract.
Neither was DLS-AU mandated by law to pay Bernardo retirement benefits. The compulsory
retirement age under Article 302 [287] of the Labor Code, as amended, is 65 years old. When
the employee reaches said age, his/her employment is deemed terminated. The matter of
extension of the employee's service is addressed to the sound discretion of the employer; it is a
privilege only the employer can grant. In this case, Bernardo was effectively separated from the
service upon reaching the age of 65 years old. DLS-AU merely granted Bernardo the privilege to
teach by engaging his services for several more years after reaching the compulsory retirement
age. Assuming arguendo that Bernardo was entitled to retirement benefits, he should have
claimed the same upon reaching the age of 65 years old. Under Article 291 of the Labor Code,
as amended, all money claims arising from employer-employee relations shall be filed within
three years from the time the cause of action accrues.

Still according to DLS-AU and Dr. Bautista, Bernardo had no cause of action against Dr. Bautista
because the latter was only acting on behalf of DLS-AU as its Executive Vice-President. It is a
well-settled rule that a corporation is a juridical entity with a legal personality separate and
distinct from the people comprising it and those acting for and on its behalf. There was no
showing that Dr. Bautista acted deliberately or maliciously in refusing to pay Bernardo his
retirement benefits, so as to make Dr. Bautista personally liable for any corporate obligations of
DLS-AU to Bernardo.

Finally, DLS-AU asserted that Bernardo failed to establish the factual and legal bases for his
claims for actual, moral, and exemplary damages, and attorney's fees. There was no proof of
the alleged value of the profits or any other loss suffered by Bernardo because of the non-
payment of his retirement benefits. There was likewise no evidence of bad faith or fraud on the
part of DLS-AU in refusing to grant Bernardo retirement benefits.

On December 13, 2004, the Labor Arbiter rendered its Decision dismissing Bernardo's complaint
on the ground of prescription, thus:

[T]he age of sixty-five (65) is declared as the compulsory retirement age under
Article 287 of the Labor Code, as amended. When the compulsory retirement age
is reached by an employee or official, he is thereby effectively separated from the
service (UST Faculty Union v. National Labor Relations Commission, University of
Santo Tomas, G.R. No. 89885, August 6, 1990). As mentioned earlier, [Bernardo]
is already seventy-five (75) years old, and is way past the compulsory retirement
age. If he were indeed entitled to receive his retirement pay/benefits, he should
have claimed the same ten (10) years ago upon reaching the age of sixty-five
(65).
 In this connection, it would be worthy to mention that the Labor Code contains a
specific provision that deals with money claims arising out of employer-employee
relationships. Article 291 of the Labor Code as amended clearly provides:

"ART 291. MONEY CLAIMS. - All money claims arising from

employer-employee relations accruing during the effectivity of this
Code shall be filed within three (3) years from the time the cause
of action accrued; otherwise they shall forever be barred.

xxxx

The prescriptive period referred to in Article 291 of the Labor Code, as amended
applies to all kinds of money claims arising from employer-employee relations
including claims for retirement benefits.

The ruling of the Supreme Court in De Guzman v. Court of Appeals, (G.R. No.
132257, October 12, 1998), squarely applies to the instant case:

"The language of Article 291 of the Labor Code does not limit its
application only to "money claims specifically recoverable under
said Code, " but covers all money claims arising from employer-
employee relations. Since petitioners' demand for unpaid
retirement/separation benefits is a money claim arising from their
employment by private respondent, Article 291 of the Labor Code
is applicable. Therefore, petitioners' claim should be filed within
three years from the time their cause of action accrued, or forever
barred by prescription. "

It cannot be denied that the claim for retirement benefits/pay arose out of
employer-employee relations. In line with the decision of the Supreme Court
in De Guzman, it should be treated as a money claim that must be claimed within
three years from the time the cause of action accrued.

Thus, upon reaching the compulsory retirement age of sixty-five (65), [Bernardo]
was effectively separated from the service. Clearly, such was the time when his
cause of action accrued. He should have sought the payment of such benefits/pay
within three (3) years from such time. It cannot be denied that [Bernardo]
belatedly sought the payment of his retirement benefits/pay considering that he
filed the instant Complaint only ten (10) years after his cause of action accrued.
For failure to claim the retirement benefits/pay to which he claims to be entitled
within three (3) years from the time he reached the age of sixty-five (65), his
claim should be forever barred.11

The Labor Arbiter decreed:

WHEREFORE, premises considered, judgment is hereby rendered DISMISSING

the instant Complaint on the ground that the claim for retirement benefits/pay is
already barred by prescription.12

Bernardo appealed the foregoing Labor Arbiter's Decision to the NLRC, arguing that since he
continuously worked for DLS-AU and Dr. Bautista until October 12, 2003, he was considered
retired and the cause of action for his retirement benefits accrued only on said date. There was
clearly an agreement between Bernardo and DLS-AU that the former would continue teaching
even after reaching the compulsory retirement age of 65 years. In addition, under Republic Act
No. 7641, part-time workers are entitled to retirement pay of one-half month salary for every
years of service, provided that the following conditions are present: (a) there is no retirement
plan between the employer and employees; (b) the employee has reached the age of 60 years
old for optional retirement or 65 years old for compulsory retirement; and (c) the employee
should have rendered at least five years of service with the employer. Bernardo avowed that all
these conditions were extant in his case.

The NLRC, in its Decision dated June 30, 2008, reversed the Labor Arbiter's ruling and found
that Bernardo timely filed his complaint for retirement benefits. The NLRC pointed out that DLS-
AU and Dr. Bautista, knowing fully well that Bernardo already reached the compulsory age of
retirement of 65 years old, still extended Bernardo's employment. Thus, Bernardo's cause of
action for payment of his retirement benefits accrued only on November 8, 2003, when he was
informed by DLS-AU that his contract would no longer be renewed and he was deemed
separated from employment. The principle of estoppel was also applicable against DLS-AU and
Dr. Bautista who could not validly claim prescription when they were the ones who permitted
Bernardo to work beyond retirement age. As to Bernardo's entitlement to retirement benefits,
the NLRC held:

Equally untenable is the contention that [Bernardo], being a part time employee,
is not entitled to retirement benefits under Republic Act No. 7641. Indeed, a
perusal of the retirement law does not exclude a part time employee from
enjoying retirement benefits. On this score, Republic Act No. 7641 explicitly
provides as within its coverage "all employees in the private sector, regardless of
their position, designation, or status, and irrespective of the method by which
their wages are paid" (Section 1, Rules Implementing the New Retirement Law)
(Underlined for emphasis). The only exceptions are employees covered by the
Civil Service Law; domestic helpers and persons in the personal service of
another; and employees in retail, service and agricultural establishments or
operations regularly employing not more than ten employees (ibid). Clearly,
[Bernardo] does not fall under any of the exceptions.

Lastly, it is axiomatic that retirement law should be construed liberally in favor of

the employee, and all doubts as to the intent of the laws should be resolved in
favor of the retiree to achieve its humanitarian purpose (Re: Gregorio G. Pineda,
187 SCRA 469, 1990). A contrary ruling would inevitably defy such settled rule. 13

In the end, the NLRC adjudged:

WHEREFORE, judgment is hereby rendered REVERSING and SETTING ASIDE the

appealed decision of the Labor Arbiter. Accordingly, a new one is issued finding
[Bernardo] entitled to retirement benefits under Republic Act No. 7641 and
ordering [DLS-AU and Dr. Bautista] to pay [Bernardo] his retirement benefits
equivalent to at least one-half (1/2) month of his latest salary for every year of
his service. Other claims are hereby denied for lack of merit. 14

In a Resolution dated September 15, 2008, the NLRC denied the Motion for Reconsideration of
DLS-AU and Dr. Bautista for lack of merit.

DLS-AU filed before the Court of Appeals a Petition for Certiorari and Prohibition, imputing grave
abuse of discretion on the part of the NLRC for (1) holding that Bernardo was entitled to
retirement benefits despite the fact that he was a mere part-time employee; and (2) not
holding that Bernardo's claim for retirement benefits was barred by prescription.

The Court of Appeals promulgated its Decision on June 29, 2009, affirming in toto the NLRC
judgment. The Court of Appeals ruled that the coverage of, as well as the exclusion from,
Republic Act No. 7641 are clearly delineated under Sections 1 and 2 of the Implementing Rules
of Book VI, Rule II of the Labor Code, as well as the Labor Advisory on Retirement Pay Law;
and part-time employees are not among those excluded from enjoying retirement benefits.
Labor and social laws, being remedial in character, should be liberally construed in order to
further their purpose. The appellate court also declared that the NLRC did not err in relying on
the Implementing Rules of Republic Act No. 7641 because administrative rules and regulations
issued by a competent authority remain valid unless shown to contravene the Constitution or
used to enlarge the power of the administrative agency beyond the scope intended.

The Court of Appeals additionally determined that Bernardo's cause of action accrued only upon
his separation from employment and the subsequent denial of his demand for retirement
benefits. To the appellate court, the NLRC was correct in applying the equitable doctrine of
estoppel since the continuous extension of Bernardo's employment, despite him being well over
the statutory compulsory age of retirement, prevented him from already claiming his retirement
benefits for he was under the impression that he could avail himself of the same eventually
upon the termination of his employment.

The dispositive portion of the Decision of the Court of Appeals reads:

WHEREFORE, the petition is DISMISSED for lack of merit. The assailed Decision
of the National Labor Relations Commission, dated 30 June 2008, is
hereby AFFIRMED in toto. [Bernardo's] application for the issuance of a
Temporary Restraining Order and/or Writ of Preliminary Injunction is
accordingly DENIED.15

The Motion for Reconsideration of DLS-AU was denied by the Court of Appeals in its Resolution
dated January 4, 2010.

Hence, DLS-AU lodged the present petition before us, raising the following issues:

WHETHER OR NOT PART-TIME EMPLOYEES ARE EXCLUDED FROM THE COVERAGE

OF THOSE ENTITLED TO RETIREMENT BENEFITS UNDER REPUBLIC ACT NO.
[7641].

II.

WHETHER OR NOT A CLAIM FOR RETIREMENT BENEFITS FILED BEYOND THE

PERIOD PROVIDED FOR UNDER ART. 291 OF THE LABOR CODE HAS
PRESCRIBED.16

We find the instant petition bereft of merit.

Bernardo is not questioning the

termination of his employment, but
only asserting his right to retirement
benefits.

There is no dispute that Bernardo was a part-time lecturer at DLS-AU, with a fixed-term
employment. As a part-time lecturer, Bernardo did not attain permanent status. Section 93 of
the 1992 Manual of Regulations for Private Schools provided:

Sec. 93. Regular or Permanent Status. - Those who have served the probationary
period shall be made regular or permanent. Full-time teachers who have
satisfactorily completed their probationary period shall be considered regular or
permanent.
Per Section 92 of the same Regulations, probationary period for academic personnel "shall not
be more than three (3) consecutive years of satisfactory service for those in the elementary and
secondary levels, six (6) consecutive regular semesters of satisfactory service for those in the
tertiary level, and nine (9) consecutive trimesters of satisfactory service for those in the tertiary
level where collegiate courses are offered on the trimester basis."

Thus, jurisprudence identified the requisites which should concur for a private school teacher to
acquire permanent status, viz.: (1) the teacher is a full-time teacher; (2) the teacher must have
rendered three consecutive years of service; and (3) such service must have been
satisfactory.17

Considering the foregoing requirements, a part-time employee would not attain permanent
status no matter how long he had served the school. 18 Bernardo did not become a permanent
employee of DLS-AU despite teaching there as a part-time lecturer for a total of 27 years.

Our jurisprudence had likewise settled the legitimacy of fixed-term employment. In the
landmark case of Brent School, Inc. v. Zamora,19 the Court pronounced:

From the premise - that the duties of an employee entail "activities which are
usually necessary or desirable in the usual business or trade of the employer" -
the conclusion does not necessarily follow that the employer and employee should
be forbidden to stipulate any period of time for the performance of those
activities. There is nothing essentially contradictory between a definite period of
an employment contract and the nature of the employee's duties set down in that
contract as being "usually necessary or desirable in the usual business or trade of
the employer." The concept of the employee's duties as being "usually necessary
or desirable in the usual business or trade of the employer" is not synonymous
with or identical to employment with a fixed term. Logically, the decisive
determinant in the term employment should not be the activities that the
employee is called upon to perform, but the day certain agreed upon by the
parties for the commencement and termination of their employment relationship,
a day certain being understood to be "that which must necessarily come,
although it may not be known when." Seasonal employment, and employment for
a particular project are merely instances of employment in which a period, where
not expressly set down, is necessarily implied.

xxxx

Accordingly, and since the entire purpose behind the development of legislation
culminating in the present Article 280 of the Labor Code clearly appears to have
been, as already observed, to prevent circumvention of the employee's right to
be secure in his tenure, the clause in said article indiscriminately and completely
ruling out all written or oral agreements conflicting with the concept of regular
employment as defined therein should be construed to refer to the substantive
evil that the Code itself has singled out: agreements entered into precisely to
circumvent security of tenure. It should have no application to instances where a
fixed period of employment was agreed upon knowingly and voluntarily by the
parties, without any force, duress or improper pressure being brought to bear
upon the employee and absent any other circumstances vitiating his consent, or
where it satisfactorily appears that the employer and employee dealt with each
other on more or less equal terms with no moral dominance whatever being
exercised by the former over the latter. Unless thus limited in its purview, the law
would be made to apply to purposes other than those explicitly stated by its
framers; it thus becomes pointless and arbitrary, unjust in its effects and apt to
lead to absurd and unintended consequences.
 Such interpretation puts the seal on [Bibiso v. Victorias Milling Co., Inc.]upon the
effect of the expiry of an agreed period of employment as still good rule - a rule
reaffirmed in the recent case of Escudero v. Office of the President (G.R. No.
57822, April 26, 1989) where, in the fairly analogous case of a teacher being
served by her school a notice of termination following the expiration of the last of
three successive fixedterm employment contracts, the Court held:

"Reyes' (the teacher's) argument is not persuasive. It loses sight of

the fact that her employment was probationary, contractual in
nature, and one with a definitive period. At the expiration of the
period stipulated in the contract, her appointment was deemed
terminated and the letter informing her of the non-renewal of her
contract is not a condition sine qua non before Reyes may be
deemed to have ceased in the employ of petitioner UST. The notice
is a mere reminder that Reyes' contract of employment was due to
expire and that the contract would no longer be renewed. It is not
a letter of termination. The interpretation that the notice is only a
reminder is consistent with the court's finding in Labajo, supra. x
xx."

Bernardo's employment with DLS-AU had always been for a fixed-term, i.e., for a semester or
summer. Absent allegation and proof to the contrary, Bernardo entered into such contracts of
employment with DLS-AU knowingly and voluntarily. Hence, Bernardo's contracts of
employment with DLS-AU for a fixed term were valid, legal, and binding. Bernardo's last
contract of employment with DLS-AU ended on October 12, 2003, upon the close of the first
semester for school year 2003-2004, without DLS-AU offering him another contract for the
succeeding semester.

Nonetheless, that Bernardo was a part-time employee and his employment was for a fixed
period are immaterial in this case. Bernardo is not alleging illegal dismissal nor claiming
separation pay. Bernardo is asserting his right to retirement benefits given the termination of
his employment with DLS-AU when he was already 75 years old.

As a part-time employee with fixed-term

employment, Bernardo is
entitled to retirement benefits.

The Court declared in Aquino v. National Labor Relations Commission 20 that retirement benefits
are intended to help the employee enjoy the remaining years of his life, lessening the burden of
worrying for his financial support, and are a form of reward for his loyalty and service to the
employer. Retirement benefits, where not mandated by law, may be granted by agreement of
the employees and their employer or as a voluntary act on the part of the employer.

In the present case, DLS-AU, through Dr. Bautista, denied Bernardo's claim for retirement
benefits because only full-time permanent faculty of DLS-AU are entitled to said benefits
pursuant to university policy and the CBA. Since Bernardo has not been granted retirement
benefits under any agreement with or by voluntary act of DLS-AU, the next question then is,
can Bernardo claim retirement benefits by mandate of any law?

We answer in the affirmative.

Republic Act No. 7641 is a curative social legislation. It precisely intends to give the minimum
retirement benefits to employees not entitled to the same under collective bargaining and other
agreements. It also applies to establishments with existing collective bargaining or other
agreements or voluntary retirement plans whose benefits are Jess than those prescribed in said
law.21
Article 302 [287] of the Labor Code, as amended by Republic Act No. 7641, reads:

Art. 302 [287]. Retirement. -Any employee may be retired upon reaching
the retirement ageestablished in the collective bargaining agreement or other
applicable employment contract.

In case of retirement, the employee shall be entitled to receive such retirement

benefits as he may have earned under existing Jaws and any collective bargaining
agreement and other agreements: Provided however, That an employee's
retirement benefits under any collective bargaining and other agreement shall not
be less than those provided herein.

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

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

Unless the parties provide for broader inclusions, the term one-half month salary
shall mean fifteen (15) days plus one twelfth (1/12) of the 13th month pay and
the cash equivalent of not more than five (5) days of service incentive leaves.

xxxx

Retail, service and agricultural establishments or operations employing

not more than ten (10) employees or workers are exempted from the
coverage of this provision.

Violation of this provision is hereby declared unlawful and subject to the penal
provisions provided under Article 288 of this Code. (Emphases ours.)

Book VI, Rule II of the Rules Implementing the Labor Code clearly describes the coverage of
Republic Act No. 7641 and specifically identifies the exemptions from the same, to wit:

Sec. 1. General Statement on Coverage. - This Rule shall apply to all employees
in the private sector, regardless of their position, designation or status
and irrespective of the method by which their wages are paid, except to
those specifically exempted under Section 2 hereof. As used herein, the
term "Act" shall refer to Republic Act No. 7641, which took effect on January 7,
1993.

Section 2. Exemptions. - This Rule shall not apply to the following employees:

2.1 Employees of the National Government and its political subdivisions,

including Government-owned and/or controlled corporations, if they are
covered by the Civil Service Law and its regulations.

2.2 Domestic helpers and persons in the personal service of another. (Deleted by
Department Order No. 20 issued by Secretary Ma. Nieves R. Confessor on May
31, 1994.)
 2.3. Employees of retail, service and agricultural establishments or
operations regularly employing not more than ten (10) employees. As
used in this sub-section:

(a) "Retail establishment" is one principally engaged in the sale of goods to end-
users for personal or household use. It shall lose its retail character qualified for
exemption if it is engaged in both retail and wholesale of goods.

(b) "Service establishment" is one principally engaged in the sale of service to

individuals for their own or household use and is generally recognized as such.

(c) "Agricultural establishment/operation" refers to an employer which is engaged

in agriculture. This term refers to all farming activities in all its branches and
includes, among others, the cultivation and tillage of the soil, production,
cultivation, growing and harvesting of any agricultural or horticultural
commodities, dairying, raising of livestock or poultry, the culture of fish and other
aquatic products in farms or ponds, and any activities performed by a farmer or
on a farm as an incident to or in conjunctions with such farming operations, but
does not include the manufacture and/or processing of sugar, coconut, abaca,
tobacco, pineapple, aquatic or other farm products. (Emphases ours.)

Through a Labor Advisory dated October 24, 1996, then Secretary of Labor, and later Supreme
Court Justice, Leonardo A. Quisumbing (Secretary Quisumbing), provided Guidelines for the
Effective Implementation of Republic Act No. 7641, The Retirement Pay Law, addressed to all
employers in the private sector. Pertinent portions of said Labor Advisory are reproduced below:

A. COVERAGE

RA 7641 or the Retirement Pay Law shall apply to all employees in the private
sector, regardless of their position, designation or status and irrespective of the
method by which their wages are paid. They shall include part-time
employees, employees of service and other job contractors and domestic
helpers or persons in the personal service of another.

The law does not cover employees of retail, service and agricultural
establishments or operations employing not more than [ten] (10) employees or
workers and employees of the National Government and its political subdivisions,
including Government-owned and/or controlled corporations, if they are covered
by the Civil Service Law and its regulations.

xxxx

C. SUBSTITUTE RETIREMENT PLAN

Qualified workers shall be entitled to the retirement benefit under RA 7641 in the
absence of any individual or collective agreement, company policy or practice. x x
x (Emphasis ours.)

Republic Act No. 7641 states that "any employee may be retired upon reaching the retirement
age x x x;" and "[i]n case of retirement, the employee shall be entitled to receive such
retirement benefits as he may have earned under existing laws and any collective bargaining
agreement and other agreements." The Implementing Rules provide that Republic Act No. 7641
applies to "all employees in the private sector, regardless of their position, designation or status
and irrespective of the method by which their wages are paid, except to those specifically
exempted x x x." And Secretary Quisumbing' s Labor Advisory further clarifies that the
employees covered by Republic Act No. 7641 shall "include part-time employees, employees of
service and other job contractors and domestic helpers or persons in the personal service of
another."

The only exemptions specifically identified by Republic Act No. 7641 and its Implementing Rules
are: (1) employees of the National Government and its political subdivisions, including
government-owned and/or controlled corporations, if they are covered by the Civil Service Law
and its regulations; and (2) employees of retail, service and agricultural establishments or
operations regularly employing not more than 10 employees.

Based on Republic Act No. 7641, its Implementing Rules, and Secretary Quisumbing's Labor
Advisory, Bernardo, as a part-time employee of DLS-AU, is entitled to retirement benefits. The
general coverage of Republic Act No. 7641 is broad enough to encompass all private sector
employees, and part-time employees are not among those specifically exempted from the law.
The provisions of Republic Act No. 7641 and its Implementing Rules are plain, direct,
unambiguous, and need no further elucidation. Any doubt is dispelled by the unequivocal
statement in Secretary Quisumbing's Labor Advisory that Republic Act No. 7641 applies to even
part-time employees.

Under the rule of statutory construction of expressio unius est exclusio alterius, Bernardo's
claim for retirement benefits cannot be denied on the ground that he was a part-time employee
as part-time employees are not among those specifically exempted under Republic Act No. 7641
or its Implementing Rules. Said rule of statutory construction is explained thus:

It is a settled rule of statutory construction that the express mention of one

person, thing, or consequence implies the exclusion of all others. The rule is
expressed in the familiar maxim, expressio unius est exclusio alterius.

The rule of expressio unius est exclusio alterius is formulated in a number of

ways. One variation of the rule is the principle that what is expressed puts an end
to that which is implied. Expressum facit cessare taciturn. Thus, where a statute,
by its terms, is expressly limited to certain matters, it may not, by interpretation
or construction, be extended to other matters.

xxxx

The rule of expressio unius est exclusio alterius and its variations are canons of
restrictive interpretation. They are based on the rules of logic and the natural
workings of the human mind. They are predicated upon one's own voluntary act
and not upon that of others. They proceed from the premise that the legislature
would not have made specified enumeration in a statute had the intention been
not to restrict its meaning and confine its terms to those expressly mentioned.22

The NLRC and the Court of Appeals did not err in relying on the Implementing Rules of Republic
Act No. 7641 in their respective judgments which favored Bernardo.

Congress, through Article 5 of the Labor Code, delegated to the Department of Labor and
Employment (DOLE) and other government agencies charged with the administration and
enforcement of said Code the power to promulgate the necessary implementing rules and
regulations. It was pursuant to Article 5 of the Labor Code that then Secretary of Labor Ma.
Nieves R. Confesor issued on January 7, 1993 the Rules Implementing the New Retirement Law,
which became Rule II of Book VI of the Rules Implementing the Labor Code.

In ruling that Bernardo, as part-time employee, is entitled to retirement benefits, we do no less

and no more than apply Republic Act No. 7641 and its Implementing Rules issued by the DOLE
under the authority given to it by the Congress. Needless to stress, the Implementing Rules
partake the nature of a statute and are binding as if written in the law itself. They have the
force and effect of law and enjoy the presumption of constitutionality and legality until they are
set aside with finality in an appropriate case by a competent court.23

Moreover, as a matter of contemporaneous interpretation of law, Secretary Quisumbing's Labor

Advisory has persuasive effect. It is undisputed that in administrative law, contemporaneous
and practical interpretation of law by administrative officials charged with its administration and
enforcement carries great weight and should be respected, unless contrary to law or manifestly
erroneous.24

We further find that the Implementing Rules and Secretary Quisumbing' s Labor Advisory are
consistent with Article 4 of the Labor Code, which expressly mandates that "all doubts in the
implementation and interpretation of the provisions of this Code, including its implementing
rules and regulations, shall be resolved in favor of labor." There being no compelling argument
herein to convince us otherwise, we uphold the legality and validity of the Implementing Rules
and Secretary Quisumbing's Labor Advisory, and likewise apply the same to Bernardo's case.

For the availment of the retirement benefits under Article 302 [287] of the Labor Code, as
amended by Republic Act No. 7641, the following requisites must concur: (1) the employee has
reached the age of 60 years for optional retirement or 65 years for compulsory retirement; (2)
the employee has served at least five years in the establishment; and (3) there is no retirement
plan or other applicable agreement providing for retirement benefits of employees in the
establishment. Bernardo - being 75 years old at the time of his retirement, having served DLS-
AU for a total of 27 years, and not being covered by the grant of retirement benefits in the CBA
- is unquestionably qualified to avail himself of retirement benefits under said statutory
provision, i.e., equivalent to one-half month salary for every year of service, a fraction of at
least six months being considered as one whole year.25

Bernardo's employment was

extended beyond the compulsory
retirement age and the cause of
action for his retirement benefits
accrued only upon the termination of
his extended employment with DLS-AU.

Article 306 [291] of the Labor Code mandates:

Art. 306 [291]. Money claims. - All money claims arising from employer-
employee relations accruing during the effectivity of this Code shall be filed within
three years from the time the cause of action accrued; otherwise they shall be
forever barred.

DLS-AU invokes UST Faculty Union v. National Labor Relations Commission, 26 wherein it was
held that when an employee or official has reached the compulsory retirement age, he is
thereby effectively separated from the service. And so, DLS-AU maintains that Bernardo's cause
of action for his retirement benefits, which is patently a money claim, accrued when he reached
the compulsory retirement age of 65 years old, and had already prescribed when Bernardo filed
his complaint only 10 years later, when he was already 75 years old.

We are not persuaded.

The case of UST Faculty Union is not in point as the issue involved therein was the right of a
union to intervene in the extension of the service of a retired employee. Professor Tranquilina J.
Marilio (Prof. Marilio) already reached the compulsory retirement age of 65 years old, but was
granted by the University of Sto. Tomas (UST) an extension of two years tenure. We ruled in
said case that UST no longer needed to consult the union before refusing to further extend Prof.
Marilio' s tenure.1âwphi1

A cause of action has three elements, to wit, (1) a right in favor of the plaintiff by whatever
means and under whatever law it arises or is created; (2) an obligation on the part of the
named defendant to respect or not to violate such right; and (3) an act or omission on the part
of such defendant violative of the right of the plaintiff or constituting a breach of the obligation
of the defendant to the plaintiff.27

Bernardo's right to retirement benefits and the obligation of DLS-AU to pay such benefits are
already established under Article 302 [287] of the Labor Code, as amended by Republic Act No.
7641. However, there was a violation of Bernardo's right only after DLS-AU informed him on
November 8, 2003 that the university no longer intended to offer him another contract of
employment, and already accepting his separation from service, Bernardo sought his retirement
benefits, but was denied by DLSAU. Therefore, the cause of action for Bernardo's retirement
benefits only accrued after the refusal of DLS-AU to pay him the same, clearly expressed in Dr.
Bautista's letter dated February 12, 2004. Hence, Bernardo's complaint, filed with the NLRC on
February 26, 2004, was filed within the three-year prescriptive period provided under Article
291 of the Labor Code.

Even granting arguendo that Bernardo's cause of action already accrued when he reached 65
years old, we cannot simply overlook the fact that DLS-AU had repeatedly extended Bernardo's
employment even when he already reached 65 years old. DLS-AU still knowingly offered
Bernardo, and Bernardo willingly accepted, contracts of employment to teach for semesters and
summers in the succeeding 10 years. Since DLS-AU was still continuously engaging his services
even beyond his retirement age, Bernardo deemed himself still employed and deferred his claim
for retirement benefits, under the impression that he could avail himself of the same upon the
actual termination of his employment. The equitable doctrine of estoppel is thus applicable
against DLS-AU. In Planters Development Bank v. Spouses Lopez, 28 we expounded on the
principle of estoppels as follows:

Section 2, Rule 131 of the Rules of Court provides that whenever a party has, by
his own declaration, act, or omission, intentionally and deliberately led another to
believe that a particular thing is true, and to act upon such belief, he cannot, in
any litigation arising out of such declaration, act or omission, be permitted to
falsify it.

The concurrence of the following requisites is necessary for the principle of

equitable estoppel to apply: (a) conduct amounting to false representation or
concealment of material facts or at least calculated to convey the impression that
the facts are otherwise than, and inconsistent with, those which the party
subsequently attempts to assert; (b) intent, or at least expectation that this
conduct shall be acted upon, or at least influenced by the other party; and (c)
knowledge, actual or constructive, of the actual facts.

Inaction or silence may under some circumstances amount to a

misrepresentation, so as to raise an equitable estoppel. When the silence is of
such a character and under such circumstances that it would become a fraud on
the other party to permit the party who has kept silent to deny what his silence
has induced the other to believe and act on, it will operate as an estoppel. This
doctrine rests on the principle that if one maintains silence, when in conscience
he ought to speak, equity will debar him from speaking when in conscience he
ought to remain silent.

DLS-AU, in this case, not only kept its silence that Bernardo had already reached the
compulsory retirement age of 65 years old, but even continuously offered him contracts of
employment for the next 10 years. It should not be allowed to escape its obligation to pay
Bernardo's retirement benefits by putting entirely the blame for the deferred claim on
Bernardo's shoulders.

WHEREFORE, premises considered, the instant Petition 1s DISMISSED for lack of merit. The
Decision dated June 29, 2009 and Resolution dated January 4, 2010 of the Court of Appeals in
CA-G.R. SP No. 106399 are AFFIRMED. SO ORDERED.
G.R. No. 133215 July 15, 1999

PAGPALAIN HAULERS, INC., petitioner,

vs.
The HONORABLE CRESENCIANO B. TRAJANO, in his official as Secretary of Labor and
Employment, the HONORABLE RENATO D. PARUNGO, in his official capacity as the
Med-Arbiter in DOLE Case No. NCR-OD-M-9705-006, and the INTEGRATED LABOR
ORGANIZATION (ILO-PHILS) PAGPALAIN WORKERS UNION-ILO-PHILS., respondent.

ROMERO, J.:

On May 14, 1997, respondent Integrated Labor Organization-Pagpalain Haulers Worker's Union
(hereafter referred to as ILO-PHILS), in a bid to represent the rank-and-file drivers and helpers
of petitioner Pagpalain Haulers, Inc. (herafter referred to as Pagpalain), filed a petition for
certification election with the Department of Labor and Employment. ILO-PHILS attached to the
petition copies of its charter certificate, its constitution and by-laws, its books of account, and a
list of its officers and their addresses.

On July 10, 1997, Pagpalain filed a motion to dismiss the petition, alleging that ILO-PHILS was
not a legitimate labor organization due to its failure to comply with the requirements for
registration under the Labor Code. Specifically, it claimed that the books of account submitted
by ILO-PHILS were not verified under oath by its treasurer and attested to by its president, as
required by Rule II, Book V of the Omnibus Rules Implementing the Labor Code.

In a reply dated August 4, 1997, ILO-PHILS dismissed Pagpalain's claims, saying that
Department Order No. 9, Series of 1997 had dispensed with the requirement that a local or
chapter of a national union submit books of account in order to be registered with the
Department of Labor and Employment.

Finding in favor of ILO-PHILS, the Med-Arbiter, on August 27, 1997, ordered the holding of
certification elections among the rank-and-file of Pagpalain Haulers. Pagpalain promptly
appealed the decision to the Secretary of Labor and Employment. It claimed that the Med-
Arbiter had gravely abused his discretion in allowing Department Order No. 9 to take
precedence over a ruling of the Supreme Court. Pagpalain cited Protection Technology v.
Secretary, Department of labor and Employment 1and Progressive Development Corporation v.
Secretary of Labor 2 in support of its contention.

Declaring Protection and Progressive to be inapplicable to the case before him, the Secretary,
on February 27, 1998, issued a resolution dismissing Pagpalain's appeal. In his own words, "[i]n
these aforementioned cases, the Supreme Court premised its ruling on the previous rules
implementing the Labor Code, particularly Book V, that provides the requirements for
registration of a local for chapter of a federation or national union. With the issuance of
Department Order No. 09 amending the rules implementing Book V of the Code, the
requirement on books of account no longer exists." 3

Aggrieved by said resolution, Pagpalain now comes to this Court for relief claiming that the
Secretary of Labor acted without jurisdiction in issuing the questioned resolution. In support of
its proposition, it claims that:

1. DEPARTMENT ORDER NO. 9, SERIES OF 1997, ISSUED BY PUBLIC RESPONDENT SECRETARY

OF LABOR IS NULL AND VOID FOR BEING CONTRARY TO PUBLIC POLICY LAID DOWN BY THE
SUPREME COURT IN PROTECTION TECHNOLOGY, INC. V. SECRETARY OF LABOR (G.R. NO.
117211, 1 MARCH 1995) AND PROGRESSIVE DEVELOPMENT CORP. V. SECRETARY OF
LABOR (G.R. NO. 96425, 4 FEBRUARY 1992);

2. DEPARTMENT ORDER NO. 9, SERIES OF 1997, OF PUBLIC RESPONDENT SECRETARY OF

LABOR CANNOT ALTER THE REQUIREMENTS OF ARTICLES 241(H) AND (J) OF THE LABOR CODE
OF THE PHILIPPINES, NOR CAN IT PREVAIL OVER THE RULINGS OF THE SUPREME COURT,
WHICH FORM PART OF THE LAW OF THE LAND.

Pagpalain's contentions are without merit.

Under Article 234 of the Labor Code, the requirements for registration of a labor organization is
as follows:

Art. 234. Requirements of registration. — Any applicant labor organization, association or group
of unions or workers shall acquire legal personality and shall be entitled to the rights and
privileges granted by law to legitimate labor organizations upon issuance of the certificate of
registration based on the following requirements:

(a) Fifty pesos (P50.00) registration fee;

(b) The names of its officers, their addresses, the principal address of the labor organization,
the minutes of the organizational meetings and the list of the workers who participated in such
meetings;

(c) The names of all its members comprising at least twenty percent (20%) of all the employees
in the bargaining unit where it seeks to operate;

(d) If the applicant union has been in existence for one or more years, copies of its annual
financial reports; and

(e) Four (4) copies of the constitution and by-laws of the applicant union, minutes of its
adoption or ratification, and the list of the members who participated in it.

As can be gleaned from the above, the Labor Code does not require the submission of books of
account in order for a lobor organization to be registered as a legitimate labor organization. The
requirement that books of account be submitted as a requisite can be found only in Book V of
the Omnibus Rules Implementing the Labor Code, prior to its amendment by Department Order
No. 9, Series of 1997. Specifically, the old Section 3(e), Rule II, of Book V provided that "[t]he
local or chapter of a labor federation or national union shall have and maintain a constitution
and by-laws, set of officers and books of accounts. For reporting purposes, the procedure
governing the reporting of independently registered unions, federations or national unions shall
be observed."

In Progressive Development Corporation, cited by Pagpalain, this Court held that the above-
mentioned "'procedure governing the reporting of indepedently registered unions' refers to the
certification and attestation requirements contained in Article 235, paragraph 2." Article 235,
paragraph 2 provides that "[a]ll requisite documents and papers shall be certified under oath by
the secretary or the treasurer of the organizations, as the case may be, and attested to by its
president;" hence, in the above-mentioned case, we ruled that in applications for registration by
a local or chapter of a federation or national union, the constitution and by-laws, set of officers
and books of account submitted by said local or chapter must be certified under oath by the
secretary or treasurer and attested to by its president.

Three years, later, in Protection Technology v. Secretary of Labor, we amplified our ruling in
Progressive, saying that the non-submission of books of acocunt certified by and attested to by
the appropriate officer is a ground for an employer to legitimately oppose a petition for
certification election filed by a local or chapter of a national union.
By virtue of Department Order No. 9, Series of 1997, however, the documents needed to be
submitted by a local or chapter have been reduced to the following:

(a) A charter certificate issued by the federation or national union indicating the creation or
establishment of the local/chapter;

(b) The names of the local/chapter's officers, their addresses, and the principal office of the
local/chapter;

(c) The local/chapter's constitution and by-laws; provided that where the local/chapter's
constitution and by-laws is the same as that of the federation or national union, this fact shall
be indicated accordingly.

All the foregoing supporting requirements shall be certified under oath by the Secretary or
Treasurer of the local/chapter and attested by its President. 4

Since Department Order No. 9 has done away with the submission of books of account as a
requisite for registration, Pagpalain's only recourse now is to have said order declared null and
void. It premises its case on the principles laid down in Progressive and Protection Technology.
First, Pagpalain maintains that Department Order No. 9 is illegal, allegedly because it
contravenes the above-mentioned rulings of this Court. Citing Article 8 of the Civil Code, which
provides that [j]udicial decisions applying or interpreting the laws or the Constitution shall form
a part of the legal system of the Philippines," Pagpalain declares the two cases part of the law of
the land which, under the third paragraph of Article 7 of the Civil Code, 5 may not be
supplanted by mere regulation.

Second, it claims that dispensing with books of account contravenes public policy, citing
Protection Technology, as follows:

It is immaterial that the Union, having been organized for less than a year before the
application for registration with the BLR, would have had no real opportunity to levy and collect
dues and fees from its members which need to be recorded in the books of account. Such
accounting books can and must be submitted to the BLR, even if they contain no detailed or
extensive entries as yet. The point to be stressed is that the applicant local or chapter must
demonstrate to the BLR that it is entitled to registered status because it has in place a system
for accounting for members' contributions to its fund even before it actually receives dues and
fees from its members. The controlling intention is to minimize the risk of fraud and diversionin
the course of the subsequent formation and growth of the Union fund. [Emphasis petitioner's]

To buttress its argument, Pagpalain also cites Progressive, thus:

The employer naturally needs assurance that the union it is dealing with is a bona fide
organization, one which has not submitted false statements or misrepresentations to the
Bureau. The inclusion of the certification and attestation requirements will in a marked degree
allay these apprehensions of management. Not only is the issuance of any false statement and
misrepresentation a ground for cancellation of registration (See Artide 239 (a), (c) and (d)); it
is also a ground for a criminal charge of perjury.

The certification and attestation requirements are preventive measures against the commission
of fraud. They likewise afford a measure of protection to unsuspecting employees who may be
lured into joining unscrupulous or fly-by-night unions whose sole purpose is to control union
funds or to use the union for dubious ends. [Emphasis petitioner's]

Finally, Pagpalain cites as indicative of public policy, the following sections of Article 241 of the
Labor Code:

The following are the rights and conditions of membership in a labor organization:
 xxx xxx xxx

(h) Every payment of fees, dues, or other contributions by a member shall be evidenced by a
receipt signed by the officer or agent making the collection and entered into the record of the
organization to be kept and maintained for the that purpose;

xxx xxx xxx

(j) Every income or revenue of the organization shall be evidenced by a record showing its
source, and every expenditure of its funds shall be evidenced by a receipt from the person to
whom the payment is made, which shall state the date, place and purpose of such
payment. Such record or receipt shall form part of the financial records of the organizations .
[Emphasis petitioner's]

Under Article 8 of the Civil Code, "[j]udicial decisions applying or interpreting the laws or the
Constitution shall form a part of the legal system of the Philippines." This does not mean,
however, that courts can create law. The courts exist for interpreting the law, not for enacting
it. To allow otherwise would be violative of the principle of separation of powers, inasmuch as
the sole function of our courts is to apply or interpret the laws, particularly where gaps
or lacunae exist or where ambiguities becloud issues, but it will not arrogate unto itself the task
of legislating.

Consequently, Progressive and Protection Technology are not to be deemed as laws on the
registration of unions. They merely interpret and apply the implementing rules of the Labor
Code as to registration of unions. It is this interpretation that forms part of the legal system of
the Philippines, for the inperpretation placed upon the written law by a competent court has the
force of law. 6 Progressive and Protection Technology, however, applied and interpreted the
then existing Book V of the Omnibus Rules Implementing the Labor Code. Since Book V of the
Omnibus Rules, as amended by Department Order No. 9, no longer requires a local or chapter
to submit books of accounts as a prerequisites for registration, the doctrines enunciated in the
above-mentioned cases, with respect to books of account, are already passé and therefore, no
longer applicable. Hence, Pagpalain cannot insist that ILO-PHILS comply with the requirements
prescribed in said rulings, for the current implementing rules have deleted the same.

Neither can Pagpalain contend that Department Order No. 9 is an invalid exercise of rule-
making power by the Secretary of Labor. For an administrative order to be valid, it must i) be
issued on the authority of law and (ii) it must not be contrary to the law and the Constitution. 7

Department Order No. 9 has been issued on authority of law. Under the law, the Secretary is
authorized to promulgate rules and regulations to implement the Labor Code. Specifically,
Article 5 of the Labor Code provides that "[t]he Department of Labor and other government
agencies charged with the administration and enforcement of this Code or any of its parts shall
promulgate the necessary implementing rules and regulations." Consonant with this article, the
Secretary of Labor and Employment promulgated the Omnibus Rules Implementing the Labor
Code. By virtue of this self-same authority, the Secretary amended the above-mentioned
omnibus rules by issuing Department Order No. 9, Series of 1997.

Moreover, Pagpalain has failed to show that Department Order No. 9 is contrary to the law or
the Constitution. At the risk of being repetitious, the Labor Code does not require a local or
chapter to submit books of account in order for it to be registered as a legitimate labor
organization. There is, thus, no inconsistency between the Labor Code and Department Order
No. 9. Neither has Pagpalain shown that said order contravenes any provision of the
Constitution.

Pagpalain cannot also allege that Department Order No. 9 is violative of public policy. As
adverted to earlier, the sole function of our courts is to apply or interpret the laws. 8 It does not
formulate public policy, which is the province of the legislative and executive branches of
government. It cannot, thus, be said that the principles laid down by the court in Progressive
and Protection Technology constitute public policy on the matter. They do, however, constitute
the Court's interpretation of public policy, as formulated by the executive department through
its promulgation of rules implementing the Labor Code. However, this public policy has itself
been changed by the executive department, through the amendments introduced in Book V of
the Omnibus Rules by Department Order No. 9. It is not for us to question this change in policy,
it being a well-established principle beyond question that it is not within the province of the
courts to pass judgment upon the policy of legislative or executive action. 9 Notwithstanding
the expanded judicial power under Section 1, Article VIII of the Constitution, an inquiry on the
above-stated policy would delve into matters of wisdom not within the powers of this Court.

Furthermore, the controlling intention in requiring the submission of books of account is the
protection of labor through the minimization of the risk of fraud and diversion in the handling of
union funds. As correctly pointed out by the Solicitor General, this intention can still be realized
through other provisions of the Labor Code. Article 241 of the Labor Code, for instance:

Art. 241. Rights and conditions of membership in a labor organization — The following are the
rights and conditions of membership in a labor organization:

xxx xxx xxx

(b) The members shall be entitled to full and detailed reports from their officers and
representatives of all financial transactions as provided for in the constitution and by-laws of the
organization;

xxx xxx xxx

(g) No officer, agent or member of a labor organization shall collect any fees, dues, or other
contributions in its behalf or make any disbursement of its funds unless he is duly authorized
pursuant to its constitution and by-laws;

(h) Every payment of fees, dues, or other contributions by a member shall be evidenced by a
receipt signed by the officer or agent making the collection and entered into the record of the
organization to be kept and maintained for the that purpose;

(i) The funds of the organization shall not be applied for any purpose or object other than those
expressly provided by its constitution or by-laws or those expressly authorized by written
resolution adopted by the majority of the members at a general meeting duly called for the
purpose;

(j) Every income or revenue of the organization shall be evidenced by a record showing its
source, and every expenditure of its funds shall be evidenced by a receipt from the person to
whom the payment is made, which shall state the date, place and purpose of such payment.
Such record or receipt shall form part of the financial records of the organization.

xxx xxx xxx

(l) The treasurer of any labor organization and every officer thereof who is responsible for the
account of such organization or for the collection, management, disbursement, custody or
control of the fund, moneys and other properties of the organization, shall render to the
organization and to its members a true and correct account of all the moneys received and paid
by him since he assumed office or since the last day on which he rendered such account, and of
all bonds, securities and other properties of the organization entrusted to his custody or under
his control. The rendering of such account shall be made:

(1) At least once a year within 30 days after the close of its fiscal year;
(2) At such other times as may be required by a resolution of the majority of the members of
the organization;

(3) Upon vacating his office.

The account shall be duly audited and verified by affidavit and a copy thereof shall be furnished
the Secretary of Labor.

(m) The books of account and other records of the financial activities of any labor organization
shall be open to inspection by any officer or member thereof during office hours;

xxx xxx xxx

Furthermore, Article 274 of the Labor Code empowers the Secretary of Labor or his duly
authorized representative to inquire into the financial activities of legitimate labor organizations
upon the filing of a complaint under oath duly supported by the written consent of 20% of the
total membership of the labor organization concerned, as well as to examine their books of
accounts and other records to determine compliance or non-compliance with the law. All of
these provisions are designed to safeguard the funds of a labor organization that they may not
be squandered or frittered away by its officers or by third persons to the detriment of its
members.

Lastly, Department Order No. 9 only dispenses with books of account as a requirement for
registration of a local or chapter of a national union or federation. As provided by Article 241 (h)
and (j), a labor organization must still maintain books of account, but it need not submit the
same as a requirement for registration. Given the foregoing disquisition, we find no cogent
reason to declare Departmet Order No. 9 null and void, as well as to reverse the assailed
resolution of the Secretary of Labor.

WHEREFORE, premises considered, the instant petition is hereby DISMISSED for lack of merit
and the resolution of the Secretary of Labor dated February 27, 1998 AFFIRMED. Costs against
petitioner. SO ORDERED.