ADDALIMEOW

CASE 1
EMPLOYER-EMPLOYEE RELATIONSHIP
GREAT PACIFIC LIFE ASSURANCE CORPORATION (GREPALIFE) VS. JUDICO HONORATO
GR NO. 73887 DECEMEBER 21, 1989

FACTS: Honorato Judico filed a complaint for illegal dismissal against Grepalife, a duly organized
insurance firm. Said complaint prayed for award of money claims consisting of:

 Separation pay,
 Unpaid salary and 13th month pay,
 Refund of cash bond,
 Moral and exemplary damages and attorney's fees.

Grepalife admits that Judico entered into an agreement of agency with them to become a debit agent
attached in Cebu City. Grepalife defines a debit agent as "an insurance agent selling/servicing
industrial life plans and policy holders. As a debit agent, Judico had definite work assignments
including but not limited to collection of premiums from policyholders and selling insurance to
prospective clients. Public respondent NLRC also found out that complainant was initially paid P 200.
00 as allowance for thirteen (13) weeks regardless of production and later a certain percentage
denominated as sales reserve of his total collections but not lesser than P 200.00.
Judicowas promoted to the position of Zone Supervisor and was given additional (supervisor's) allowance
fixed at P110.00 per week. During the third week of November 1981, he was reverted to his former
position as debit agent but, for unknown reasons, not paid so-called weekly sales reserve of at least P
200.00. Finally on June 28, 1982, complainant was dismissed by way of termination of his agency
contract.

Petitioner assails and argues that the respondent is not an employee and that his compensation was not
based on any fixed number of hours he was required to devote to the service of company but rather it was
the production or result of his efforts or his work that was being compensated. That the so-called
allowance for the first thirteen weeks that Judico worked as debit agent, cannot be construed as salary
but as a subsidy or a way of assistance for transportation and meal expenses of a new debit agent during
the initial period of his training which was fixed for thirteen (13) weeks.

Respondent’s contention:
1. He received a definite amount as his wage known as "sales reserve" the failure to maintain the
same would bring him back to a beginner's employment with a fixed weekly wage of P 200.00
regardless of production.
2. He was assigned a definite place in the office to work on when he is not in the field and in addition
to canvassing and making regular reports.
3. He was burdened with the job of collection and to make regular weekly report thereto for which an
anemic performance would mean dismissal.
4. He earned out of his faithful and productive service, a promotion to Zone Supervisor with
additional supervisor's allowance, (a definite or fixed amount of P110.00) that he was dismissed
primarily because of anemic performance and not because of the termination of the contract of
agency substantiate the fact that he was indeed an employee of the petitioner and not an
insurance agent in the ordinary meaning of the term.

Both parties appealed to the NLRC and decision was rendered by the Labor Arbiter dismissing the
complaint on the ground that the employer-employee relations did not exist between the parties. On
appeal, decision was reversed by the NLRC ruling that complainant is a regular employee as defined
under Art. 281 of the Labor Code. Petitioner company moved to reconsider, which was denied, hence this
petition.

ISSUE: Whether or not employer-employee relationship existed between petitioner and private
respondent.

RULING: YES. Judico was an agent of the petitioner is unquestionable. As held in (Investment
Planning Corp. vs. SSS, 21 SCRA 294), an insurance company may have two classes of agents who sell its
insurance policies:

- Salaried employees who keep definite hours and work under the control and supervision of the
 company.
- Registered representatives who work on commission basis.

The test therefore is whether the "employer" controls or has reserved the right to control the
"employee" not only as to the result of the work to be done but also as to the means and
methods by which the same is to be accomplished. The record shows that:
- Petitioner Judico received a definite minimum amount per week as his wage known as "sales
reserve".
- He was assigned a definite place in the office to work on when he is not in the field.
- In addition to his canvassing work he was burdened with the job of collection.
- Both cases he was required to make regular report to the company regarding these duties, and for
which an anemic performance would mean a dismissal.
- Conversely faithful and productive service earned him a promotion and additional supervisor's
allowance, a definite amount of P110.00 aside from the regular P 200.00 weekly "allowance".
- His contract of services with petitioner is not for a piece of work nor for a definite period.
- In the instant case the facts show that:
o He was controlled by petitioner insurance company not only as to the kind of
work.
o The amount of results, the kind of performance but also the power of dismissal.

UNDOUBTEDLY, Private respondent, by nature of his position and work, had been a regular
employee of petitioner and is therefore entitled to the protection of the law and could not just
be terminated without valid and justifiable cause.

Alcala
Case No. 2
Existence of Employer-Employee Relationship
Ruga v. NLRC 181 SCRA 266
Facts:Petitioners were the fishermen-crew members of De Guzman Fishing Enterprises’ trawl
fishingvessel. Ruga is one of the two patron/pilot. They were paid on percentage commission basis in cash
by De Guzman's cashier - 13% of the proceeds of the sale of the fish-catch if the total proceeds exceeded
the cost of crude oil consumed during the fishing trip, otherwise, only 10% of the total proceeds of the
sale. The patron/pilot, chief engineer and master fisherman received a minimum income of P350.00 per
week while the assistant engineer, second fisherman, and fisherman-winchman received a minimum
income of P260.00 per week.
Investigation was set by the president on the report that petitioners sold some of their fish-catch at
midsea to which petitioners denied. Despite failure to present witness and formally file criminal charge,
De Guzman refused to allow petitioners to resume their work and dismissed. Petitioners individually
filed complaints for illegal dismissal, NLRC decided in favor of De Guzman invoking no employer-
employee relationship exists but joint fishing venture between the operator and the fishermen.
Issue: W/N the fishermen-crew members of the trawl fishing vessel are employees of its owner-operator,
De Guzman Fishing Enterprises, and if so, W/N they were illegally dismissed from their employment.
Ruling & MP in bold: YES. In determining the existence of an employer-employee
relationship, the elements that are generally considered are the following (a) the selection
and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d)
the employer’s power to control the employee with respect to the means and methods by
which the work is to be accomplished. The employment relation arises from contract of hire,
express or implied. In the absence of hiring, no actual employer-employee relation could
exist.
From the four (4) elements mentioned, court relied on the so-called right-of-control test
where the person for whom the services are performed reserves a right to control not only
the end to be achieved but also the means to be used in reaching such end. The test calls
merely for the existence of the right to control the manner of doing the work, not the actual
exercise of the right.
Joint fishing venture as in the Pajarillo casedo not exist in the instant case. The conduct of the fishing
operations was undisputably shown to be under supervision and control of De Guzman’s operation
manager through giving instruction via a single-side band radio and they are told to report their
activities, their position, and the number of tubes of fish-catch in one day. The conduct of the fishing
operations was monitored by De Guzman thru the patron/pilot who is responsible for disseminating the
instructions to the crew members. It must be noted that petitioners received compensation on a
percentage commission based on the gross sale of the fish-catch. Such compensation falls within the scope
and meaning of the term "wage" as defined under Article 97(f) of the Labor Code,
 3 Paz Martin Jo & Cesar Jo v. NLRC & Peter Mejila
GR No.121605 February 2, 2000

FACTS: Private respondent Peter Mejila worked as barber in a shop owned by the petitioner Jo spouses.
The barbers got two-thirds (2/3) of the fee paid for every haircut or shaving job done, while one-third
(1/3) went to the owners of the shop. Petitioners later on designated private respondent as caretaker of
the shop and in addition to his duties, he was tasked to: (1) to report to the owners of the barbershop
whenever the airconditioning units malfunctioned and/or whenever water or electric power supply was
interrupted; (2) to call the laundry woman to wash dirty linen; (3) to recommend applicants for interview
and hiring; (4) to attend to other needs of the shop. For this additional job, he was given an honorarium
equivalent to one-third (1/3) of the net income of the shop.

Due to some altercation with his fellow barbers, Mejila one day, turned over his duplicate key to the shop
and took all his belongings and started working in another barbershop. He later on filed a complaint for
illegal dismissal with the Labor Arbiter who ruled that private respondent was an employee of
petitioners, and that private respondent was not dismissed but had left his job voluntarily because of his
misunderstanding with his co-worker. This decision was reversed by the NLRC ruling that Mejila was
illegal dismissed. Hence, this appeal by the spouses.

ISSUE:(1)WON there exists an employer-employee relationship between petitioners and private

respondent.

RULING:(1) YES. Absent a clear showing that petitioners and private respondent had
intended to pursue a relationship of industrial partnership, we entertain no doubt that
private respondent was employed by petitioners as caretaker-barber.Undoubtedly, the services
performed by private respondent as barber is related to, and in the pursuit of the principal business
activity of petitioners.Later on, petitioners tapped private respondent to serve concurrently as caretaker
of the shop. Certainly, petitioners had the power to dismiss private respondent being the ones
who engaged the services of the latter. Furthermore, the following facts indubitably reveal
that petitioners controlled private respondent’s work performance; duties were complied
with by private respondent upon instructions of petitioners. Moreover, such task was far from
being negligible as claimed by petitioners.Hence, there was enough basis to declare private respondent
an employee of petitioners. Accordingly, there is no cogent reason to disturb the findings of the labor
arbiter and NLRC on the existence of employer-employee relationship between herein private parties.

CASE NO. 4

NO EMPLOYER-EMPLOYEE RELATIONSHIP
PAGUIO TRANSPORT V. NLRC & MELCHOR
FACTS:
 Melchor was hired by Paguio Transport as a taxi driver under the boundary system. He was engaged
to drive the taxi unit assigned to him on a 24-hour schedule per trip every two (2) days, for which he
used to earn an average income from P500 to P700 per trip, exclusive of the P650.00 boundary and
other deductions imposed on him.
 Melchor allegedly met a vehicular accident when he accidentally bumped a car which stopped at the
intersection even when the traffic light was green and go. After he submitted the traffic accident
report to the office of Paguio Transport, he was allegedly advised to stop working and have a rest.
After several days, he allegedly reported for work only to be told that his service was no longer
needed. Hence, he filed a complaint for illegal dismissal.
 Paguio Transport maintained that Melchor was not illegally dismissed, there being in the first place
no employer-employee relationship between them. In amplification, it was argued that the element of
control which was a paramount test to determine the existence of such a relationship was lacking. So
too, it argued the element of the payment of compensation. Considering that in lieu of the latter,
payment of boundary is instead made allegedly makes the relationship between them of a "wase-
agreement". Even if an employer-employee relationship were to be presumed as present, still
Melchor’s termination arose out of a valid cause and after he refused to articulate his stand on the
investigation being conducted on him. Paguio then harped on the supposed three occasions when
complainant figured in a vehicular accident involving the taxi unit he was driving. There were
damages which the Paguio had to shoulder on account of the supposed reckless driving of Melchor,
the former was allegedly left with no alternative but to ask Melchor’s explanation why he should still
be allowed to drive. Melchor, despite several chances, allegedly failed to do so.

ISSUE: W/N there was employer-employee relationship.

RULING: YES. The relationship of taxi owners and taxi drivers is the same as that between jeepney
owners and jeepney drivers under the "boundary system." In both cases, there is employer-employee
relationship and not of lessor-lessee. In the lease of chattels, the lessor loses complete control over the
chattel leased. In the case of jeepney owners/operators and jeepney drivers, the former exercise
supervision and control over the latter. The fact that the drivers do not receive fixed wages but get only
the excess of that so-called boundary they pay to the owner/operator is not sufficient to withdraw the
relationship between them from that of employer and employee. These drivers are employees because
they had been engaged to perform activities which were usually necessary or desirable in the usual trade
or business of the employer.

ANGELO
Case No. 126
No Employer-Employee Relationship
Insular Life Assurance Co. v. NLRC

FACTS:Insular Lifeand Basiao entered into a contract by which Basiao was authorized to solicit
forinsurance in accordance with the rules of the company. He would receive compensation, in the form of
commissions. The contract contained the relations of the parties, duties of the agent, and the acts
prohibited tohim including the modes of termination.After 4 years, the parties entered into another
contract – an Agency Manager’s Contact – and to implementhis end of it, Basiao organized an agency
while concurrently fulfilling his commitment under the first contract. The company terminated the
Agency Manager’s Contract. Basiao sued the company in a civil action. Thus,the company terminated
Basiao’s engagement under the first contract and stopped payment of his commissions.

ISSUE:Whether or notemployer-employee relationship existed between petitioner and Basiao.

RULING: NO. When an insurance agent is free to adopt his own selling methods or is free to sell
insurance at his own time, he is an independent contractor. Rules and regulations governing the
conduct of the business are provided for in the Insurance Code and enforced by the Insurance
Commissioner. It is, therefore, usual and expected for an insurance company to promulgate a set of rules
to guide its commission agents in selling its policies that they may not run afoul of the law and what it
requires or prohibits. Of such a character are the rules which prescribe the qualifications of persons who
may be insured, subject insurance applications to processing and approval by the Company, and also
reserve to the Company the determination of the premiums to be paid and the schedules of payment.
None of these really invades the agent’s contractual prerogative to adopt his own selling
methods or to sell insurance at his own time and convenience, hence cannot justifiably be
said to establish an employer-employee relationship between him and the Company.
Topic: No Employer-Employee Relationship
ABANTE, JR. vs. LAMADRID BEARING & PARTS CORP.
[G.R. No. 159890 May 28, 2004]

FACTS: Petitioner was a salesman of respondent company earning a commission of 3% of the total paid
up sales covering the whole area of Mindanao. Aside from selling, he was also tasked with collection.
Respondent corporation through its president, often required Abante to report to a particular area and
occasionally required him to go to Manila to attend conferences. Later on, bad blood ensued between the
parties due to some bad accounts that Lamadrid forced petitioner to cover. Later petitioner found out
that respondent had informed his customers not to deal with petitioner since it no longer recognized him
as a commission salesman. Petitioner filed a complaint for illegal dismissal with money claims against
respondent company and its president, Jose Lamadrid. By way of defense, respondents countered that
petitioner was not its employee but a freelance salesman on commission basis.

ISSUE: Whether or not petitioner, as a commission salesman, is an employee of respondent corporation.

HELD: To determine the existence of an employee-employer relationship, we apply the four fold test: 1)
the manner of selection and engagement; (2) the payment of wages; (3) the presence or absence of the
power of dismissal; and (4) the presence or absence of the power of control.

Applying the aforementioned test, an employer-employee relationship is notably absent in this case. It is
true that he was paid in commission yet no quota was imposed therefore a dismal performance would not
warrant a ground for dismissal. There was no specific office hours he was required to observe. He was not
designated to conduct services at a particular area or time. He pursued his selling without interference or
supervision from the company. The company did not prescribe the manner of selling merchandise. While
he was sometimes required to report to Manila, these were only intended to guide him. Moreover,
petitioner was free to offer his services to other companies.

Art. 280 is not a crucial factor because it only determines two kinds of employees. It doen;t apply where
there is no employer-employee relationship. While the term commission under Article 96 of the LC was
construed as being included in the term “wage”, there is no categorical pronouncement that the payment
of commission is conclusive proof of the existence of an employee-employer relationship.

MP: Abante is a mere commission sales agent in accordance with civil code

NO EMPLOYER-EMPLOYEE RELATIONSHIP EXIST

Encyclopedia Britannica (Phils.) Inc. v. NLRC
G.R. No. 87098, November 4, 1996

FACTS:Private complainant Benjamin Limjoco was a Sales Division Manager of petitioner. The
agreement he had with Encyclopedia Brittanica Inc. is that he will receive a commission after deducting
his office expenses. Therefore, he had an office in his district and oversaw the employees therein, and the
commission he receives, in exchange of his sales performance, was the net of the sales he had of the
expenses of his office (salaries and utility expenses). Further, it was provided that Limjoco does not
report to the office of Britannica and did not observe fixed office hours.

ISSUE:Whether or notLimjoco is subject to control by Britannica, therefore, rejecting the contention of

the petitioner that there was no employer-employee relationship that exist between them.

RULING:No. In determining the existence of an employer-employee relationship the following elements

must be present: 1) selection and engagement of the employee; 2) payment of wages; 3) power of
dismissal; and 4) the power to control the employee’s conduct. Of the above, control of employee’s conduct
is commonly regarded as the most crucial and determinative indicator of the presence or absence of an
employer-employee relationship. Under the control test, an employer-employee relationship exists where
the person for whom the services are performed reserves the right to control not only the end to be
achieved, but also the manner and means to be used in reaching that end.

In this case, “the element of control is absent; where a person who works for another does so more or less
at his own pleasure and is not subject to definite hours or conditions of work, and in turn is compensated
according to the result of his efforts and not the amount thereof, we should not find that the relationship
of employer and employee exists. In fine, there is nothing in the records to show or would “indicate that
complainant was under the control of the petitioner” in respect of the means and methods in the
performance of complainant’s work.
No Employee-employer relationship
D. Besa vs. Trajano

Facts:private respondent KaisahanngMangagawang Pilipino (KAMPIL) filed aa petition for election.

During the certification electionat BESA'S, of the 53 eligiblevoters, 49 cast their votes. 33 voted for the
union while 16 voted for no union. Among the 33 voters who opted for aunion 17 persons are shoeshiners.
It is the position of petitioner that if the shoeshiners are not considered as employees of Besa's the basic
petition for certification election must necessarilybe dismissed for failure to comply with the
mandatoryrequirements of the Labor Code, that at least thirty (30%) percent of the employees must
support thepetition for certification election and that in order to becertified as the sole and exclusive
bargaining agent

Issue:whether or not the subject shoeshiners have the juridical personality andstanding to present a
petition for certification election as well as to vote therein?

Ruling:No, there is no employee employer relationship hence there is shoeshiners don’t have the right to
vote for the election of the union. It is the employer of the piece worker whopays his wages, while the
shoe shiner in this instance is paid directly by his customer.The shoe shiner can take his share of the
proceeds everyday if he wanted to or weekly as is the practice of Besa's. The employer of the piece worker
supervises and controlshis work, but in the case of the shoe shiner, respondent Besa doesnot exercise any
degree of control or supervision over their personand their work. All these are not obtaining in the case of
a piece worker as he is in fact an employee in contemplation of law,distinct from the shoe shiner.
Consequently, employer-employee relationship between members of the Petitioning union and
respondent Mamerto B. Besa being absent, the latter could not be held guilty of the unfair
labor practice acts imputed against him."

Main Point: IN BOLD

AREEJ
 Case No. 9
No Employer-Employee Relationship
Ushio Marketing v. NLRC and Severino Antonio
294 SCRA 673, August 28, 1998

FACTS: Private respondent Severino Antonio was an electrician who worked within the premises of
petitioner Ushio's car accessory shop in Banawe, Quezon City. He filed a complaint for illegal dismissal
against petitioner, who in turn filed a motion to dismiss, alleging that Severino was not among her
employees but a free lance operator who waited on the shop’s customer should the latter require his
services. She contended that aside from the Company's regular employees, there are independent, free
lance operators who are permitted by the Company to position themselves proximate to the Company
premises. In exchange for the privileges of favorable recommendation by the Company and immediate
access to customers in need of their services, these independent operators allow the Company to collect
their service fee from the customer and this fee is given back to the independent operator at the end of
the week. Petitioner alleged that complainant was one such independent, free lance operator. Labor
Arbiter ruled in favor of petitioner and dismissed the complaint.

Severino appealed to the NLRC and alleged that Ushio Marketing hired his services and he was in fact
the most trusted employee in the company and could be called the employer’s “personal assistant”.
Affidavits of his co-electricians corroborated his allegations, showing that they were receiving
P132.00/day from Mrs. Tan, and that they cannot absent from work without her permission. NLRC ruled
that he was illegally dismissed. Hence, the petition.

ISSUE: Whether or not there existed an employer-employee relationship between petitioner and
Severino Antonio.

RULING & MP (in bold): NO. The factors to be considered in determining the existence of an
employer-employee relationship are: (1) the selection and engagement of the employee; (2) the
payment of wages; (3) the power of dismissal; and (4) the power to control the employee's
conduct. The so-called "control test" is commonly regarded as the most crucial and
determinative indicator of the presence or absence of an employer-employee relationship.
Under the control test, an employer-employee relationship exists where the person for whom
the services are performed reserves the right to control not only the end achieved, but also
the manner and means to be used in reaching that end.

As an electrician, private respondent may be presumed to have used equipment or tools in rendering
electrical services. However, private respondent failed to allege and present proof that petitioner supplied
him equipment and tools. the conduct of private respondent was not subject to the control and
supervision of petitioner or any of its personnel. Private respondent himself decided how he would render
electrical services to customers. Third, private respondent was free to offer his services to other stores
along Banaue, Quezon City, as evidenced by the affidavit of Caroline Tan To, Assistant Manager of Share
Motor Sales and private respondent's own admission. It is clear that petitioner did not have the power to
control private respondent with respect to the means and methods by which his work was to be
accomplished. Lastly, private respondent allowed petitioner to collect service fees from his customers. He
received said fees on a weekly basis. This arrangement, albeit peculiar, does not prove the existence of an
employer-employee relationship.
 THE MIGRANT WORKERS AND OVERSEAS FILIPINOS ACT OF 1995 (R.A. No. 8042)

as amended by R.A. 10022

The passage of RA 8042 as amended by RA 10022 defined the following specific policy thrusts in light of
emerging issues:

◆Guarantee of migrant workers’ rights

◆Deregulation of POEA regulatory functions

◆Stricter rules on illegal recruitment activities and the corresponding penalties

◆Selective deployment

◆Repatriation of workers

◆Reintegration program

◆ Shared government information system on migration and other basic assistance to OFWs and their
families

◆Use of information technology to facilitate dissemination of labor market information

◆ Expanded grassroots outreach education program to enable potential OFWs to arrive at informed
decisions

◆One-country team approach to synergize services to Filipino overseas

◆Restructuring of systems for disposition of adjudication cases relating to overseas employment

The new law also specifies the following major functions:

◆Regulate private sector participation in the recruitment and overseas placement of workers

◆Formulate and implement a system for promoting and monitoring the overseas employment of Filipino
workers

◆Protect the rights of Filipino workers for overseas employment

◆Exercise exclusive jurisdiction to hear and decide all pre-employment cases which are administrative in
character

◆ Recruit workers to service the requirements for trained and competent Filipino workers of foreign
governments and their instrumentalities

◆Develop and implement programs for the effective monitoring of returning contract workers

"Overseas Filipino worker" refers to a person who is to be engaged, is engaged or has been engaged in
a remunerated activity in a state of which he or she is not a citizen or on board a vessel navigating the
foreign seas other than a government ship used for miliatry or non-commercial purposes or on an
installation located offshore or on the high seas; to be used interchangeably with migrant worker."
(Section 2, R.A. No. 10022)
Illegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring, or procuring workers and includes referring, contract services, promising or advertising for
employment abroad, whether for profit or not, when undertaken by non-licensee or non-holder of
authority contemplated under Article 13(f) of Presidential Decree No. 442, as amended, otherwise known
as the Labor Code of the Philippines: Provided, That any such non-licensee or non-holder who, in any
manner, offers or promises for a fee employment abroad to two or more persons shall be deemed so
engaged. (Section 5, R.A. No. 10022)

Economic Sabotage -Illegal recruitment is deemed committed by a syndicate if carried out by a group
of three (3) or more persons conspiring or confederating with one another. It is deemed committed in
large scale if committed against three (3) or more persons individually or as a group. (Section 5, R.A.
No. 10022)

The following are the prohibited acts:

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

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

(c) To give any false notice, testimony, information or document or commit any act of misrepresentation
for the purpose of securing a license or authority under the Labor Code, or for the purpose of
documenting hired workers with the POEA, which include the act of reprocessing workers through a job
order that pertains to nonexistent work, work different from the actual overseas work, or work with a
different employer whether registered or not with the POEA;

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

(e) To influence or attempt to influence any person or entity not to employ any worker who has not
applied for employment through his agency or who has formed, joined or supported, or has contacted or is
supported by any union or workers' organization;

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

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

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

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

(k) To withhold or deny travel documents from applicant workers before departure for monetary or
financial considerations, or for any other reasons, other than those authorized under the Labor Code and
its implementing rules and regulations;

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

(n) To allow a non-Filipino citizen to head or manage a licensed recruitment/manning agency.

In the filing of cases for illegal recruitment or any of the prohibited acts under this section, the
Secretary of Labor and Employment, the POEA Administrator or their duly authorized representatives,
or any aggrieved person may initiate the corresponding criminal action with the appropriate office. For
this purpose, the affidavits and testimonies of operatives or personnel from the Department of Labor and
Employment, POEA and other law enforcement agencies who witnessed the acts constituting the offense
shall be sufficient to prosecute the accused.

The filing of an offense punishable under this Act shall be without prejudice to the filing of cases
punishable under other existing laws, rules or regulations.(Section 5, R.A. No. 10022)

Penalties:

"(a) Any person found guilty of illegal recruitment shall suffer the penalty of imprisonment of not less
than twelve (12) years and one (1) day but not more than twenty (20) years and a fine of not less than
One million pesos (P1,000,000.00) nor more than Two million pesos (P2,000,000.00).

"(b) The penalty of life imprisonment and a fine of not less than Two million pesos (P2,000,000.00) nor
more than Five million pesos (P5,000,000.00) shall be imposed if illegal recruitment constitutes economic
sabotage as defined therein.

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

"(c) Any person found guilty of any of the prohibited acts shall suffer the penalty of imprisonment of not
less than six (6) years and one (1) day but not more than twelve (12) years and a fine of not less than Five
hundred thousand pesos (P500,000.00) nor more than One million pesos (P1,000,000.00).

"If the offender is an alien, he or she shall, in addition to the penalties herein prescribed, be deported
without further proceedings.

"In every case, conviction shall cause and carry the automatic revocation of the license or registration of
the recruitment/manning agency, lending institutions, training school or medical clinic." (Section 6, R.A.
No. 10022)
Venue:

A criminal action arising from illegal recruitment as defined herein shall be filed with the Regional
Trial Court of the province or city where the offense was committed or where the offended party
actually resides at the same time of the commission of the offense: Provided, That the court where the
criminal action is first filed shall acquire jurisdiction to the exclusion of other courts. (Section 9, R.A. No.
8042)

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 damage.

The liability of the principal/employer and the recruitment/placement agency for any and all claims
under this section shall be joint and several.

In case of termination of overseas employment without just, valid or authorized cause as defined by law
or contract, or any unauthorized deductions from the migrant worker's salary, the worker shall be
entitled to the full reimbursement if [of] his placement fee and the deductions made with interest at
twelve percent (12%) per annum, plus his salaries for the unexpired portion of his employment
contract or for three (3) months for every year of the unexpired term, whichever is less. (Section 7, R.A.
No. 10022)

Prescriptive Periods:

Illegal recruitment cases under this Act shall prescribe in five (5) years: Provided, however, That illegal
recruitment cases involving economic sabotage as defined herein shall prescribe in twenty (20) years.
(Section 12, R.A. No. 8042)

Repatriation:

The repatriation of the worker and the transport of his personal belongings shall be the primary
responsibility of the agency which recruited or deployed the worker overseas. All costs attendant to
repatriation shall be borne by or charged to the agency concerned and/or its principal. Likewise, the
repatriation of remains and transport of the personal belongings of a deceased worker and all costs
attendant thereto shall be borne by the principal and/or local agency. However, in cases where the
termination of employment is due solely to the fault of the worker, the principal/employer or agency shall
not in any manner be responsible for the repatriation of the former and/or his belongings. (Section 15,
R.A. No. 8042)
Underage Migrant Worker:

Upon discovery or being informed of the presence of migrant workers whose ages fall below the minimum
age requirement for overseas deployment, the responsible officers in the foreign service shall without
delay repatriate said workers and advise the Department of Foreign Affairs through the fastest means of
communication available of such discovery and other relevant information. The license of a
recruitment/manning agency which recruited or deployed an underage migrant worker shall be
automatically revoked and shall be imposed a fine of not less than Five hundred thousand pesos (Php
500,000.00) but not more than One million pesos (Php 1,000,000.00). All fees pertinent to the processing
of papers or documents in the recruitment or deployment shall be refunded in full by the responsible
recruitment/manning agency, without need of notice, to the underage migrant worker or to his parents or
guardian. The refund shall be independent of and in addition to the indemnification for the damages
sustained by the underage migrant worker. The refund shall be paid within thirty (30) days from the
date of the mandatory repatriation as provided for in this Act. (Section 9, R.A. No. 10022)

Role of Government Agencies:

(a) Department of Foreign Affairs. - The Department, through its home office or foreign posts, shall
take priority action its home office or foreign posts, shall take priority action or make
representation with the foreign authority concerned to protect the rights of migrant workers and
other overseas Filipinos and extend immediate assistance including the repatriation of distressed
or beleaguered migrant workers and other overseas Filipinos. (Section 23, R.A. 8042)
(b) Department of Labor and Employment - The Department of Labor and Employment shall see to it
that labor and social welfare laws in the foreign countries are fairly applied to migrant workers
and whenever applicable, to other overseas Filipinos including the grant of legal assistance and
the referral to proper medical centers or hospitals. (Section 23, R.A. 8042)
(c) Philippine Overseas Employment Administration. - The Administration shall regulate private
sector participation in the recruitment and overseas placement of workers by setting up a
licensing and registration system. It shall also formulate and implement, in coordination with
appropriate entities concerned, when necessary, a system for promoting and monitoring the
overseas employment of Filipino workers taking into consideration their welfare and the domestic
manpower requirements. It shall be responsible for the regulation and management of overseas
employment from the pre-employment stage, securing the best possible employment terms and
conditions for overseas Filipino workers, and taking into consideration the needs of vulnerable
sectors and the peculiarities of sea-based and land-based workers.In addition to its powers and
functions, the Administration shall inform migrant workers not only of their rights as workers but
also of their rights as human beings, instruct and guide the workers how to assert their rights and
provide the available mechanism to redress violation of their rights. It shall also be responsible for
the implementation, in partnership with other law-enforcement agencies, of an intensified
program against illegal recruitment activities. (Section 14, R.A. No. 10022)
(d) Overseas Workers Welfare Administration. - The Welfare officer of in his absence, the
coordinating officer shall provide the Filipino migrant worker and his family all the assistance
they may need in the enforcement of contractual obligations by agencies or entities and/or by their
principals. In the performance of this function, he shall make representation and may call on the
agencies or entities concerned to conferences or conciliation meetings for the purpose of settling
the compliance or problems brought to his attention. The OWWA shall likewise formulate and
implement welfare programs for overseas Filipino workers and their families while they are
abroad and upon their return. It shall ensure the awareness by the overseas Filipino workers and
their families of these programs and other related governmental programs. (Section 15, R.A. No.
10022)
(e) Department of Health. - The Department of Health (DOH) shall regulate the activities and
operations of all clinics which conduct medical, physical, optical, dental, psychological and other
similar examinations, hereinafter referred to as health examinations, on Filipino migrant workers
as requirement for their overseas employment. (Section 16, R.A. No. 10022)
Compulsory Insurance Coverage for Agency-Hired Workers:

In addition to the performance bond to be filed by the recruitment/manning agency under Section 10,
each migrant worker deployed by a recruitment/manning agency shall be covered by a compulsory
insurance policy which shall be secured at no cost to the said worker. Such insurance policy shall be
effective for the duration of the migrant worker's employment and shall cover, at the minimum:

(A) Accidental death;

(B) Permanent total disablement;

(C) Repatriation cost of the worker when his/her employment is terminated without any valid cause,
including the transport of his or her personal belongings;

(D) Subsistence allowance benefit;

(E) Money claims arising from employer's liability which may be awarded or given to the worker in a
judgment or settlement of his or her case in the NLRC;

(F) Compassionate visit;

(G) Medical evacuation; and

(H) Medical repatriation. (Section 23, R.A. No. 10022)

TOPIC: OVERSEAS EMPLOYMENT

Santiago vs. CF Sharp Crew Management, Inc.
527 SCRA 165, G.R. No. 162419 July 10, 2007

FACTS: Petitioner had been working as a seafarer for Smith Bell Management, Inc. (respondent) for
about five (5) years. On February 1998, petitioner signed a new contract of employment with respondent,
with the duration of nine (9) months.The contract was approved by the Philippine Overseas Employment
Administration (POEA). On 9 February 1998, petitioner was thus told that he would not be leaving for
Canada anymore, but he was reassured that he might be considered for deployment at some future date.
Petitioner filed a complaint for illegal dismissal, damages, and attorney’s fees against respondent and its
foreign principal, Cable and Wireless (Marine) Ltd.

ISSUE: Whether or not the seafarer, who was prevented from leaving the port of Manila and refused
deployment without valid reason but whose POEA-approved employment contract provides that the
employer-employee relationship shall commence only upon the seafarer’s actual departure from the port
in the point of hire, is entitled to relief?

RULING: YES.
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, 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.

Moreover, 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.
KARLY
SAMEER Overseas Placement Agency, Inc. vs. Joy C. Cabiles, 732 SCRA 22

 Petitioner, Sameer Overseas Placement Agency, Inc., is a recruitment and placement agency.
Responding to an ad itpublished, respondent, Joy C. Cabiles, submitted her application for a
quality control job in Taiwan.
 Joy’s application was accepted. Joy was later asked to sign a one-year employment contract for a
monthly salary of NT$15,360.00. She alleged that Sameer Overseas Agency required her to pay a
placement fee of P70,000.00 when she signed the employment contract.
 Joy was deployed to work for Taiwan Wacoal, Co. Ltd. (Wacoal) on June 26, 1997. She alleged that
in her employment contract, she agreed to work as quality control for one year. In Taiwan, she
was asked to work as a cutter.
 Sameer Overseas Placement Agency claims that on July 14, 1997, a certain Mr. Huwang from
Wacoal informed Joy, without prior notice, that she was terminated and that “she should
immediately report to their office to get her salary and passport.” She was asked to “prepare for
immediate repatriation.”
 Joy claims that she was told that from June 26 to July 14, 1997, she only earned a total of
NT$9,000.According to her, Wacoal deducted NT$3,000 to cover her plane ticket to Manila.
 On October 15, 1997, Joy filed a complaint with the National Labor Relations Commission against
petitioner and Wacoal. She claimed that she was illegally dismissed. She asked for the return of
her placement fee, the withheld amount for repatriation costs, payment of her salary for 23
months as well as moral and exemplary damages. She identified Wacoal as Sameer Overseas
Placement Agency’s foreign principal.
 In a resolution dated March 31, 2004, the National Labor Relations Commission declared that Joy
was illegally dismissed. It reiterated the doctrine that the burden of proof to show that the
dismissal was based on a just or valid cause belongs to the employer. It found that Sameer
Overseas Placement Agency failed to prove that there were just causes for termination. There was
no sufficient proof to show that respondent was inefficient in her work and that she failed to
comply with company requirements. Furthermore, procedural due process was not observed in
terminating respondent.
 The National Labor Relations Commission awarded respondent only three (3) months’ worth of
salary in the amount of NT$46,080, the reimbursement of the NT$3,000 withheld from her, and
attorney’s fees of NT$300.The Commission denied the agency’s motion for reconsideration.
 Aggrieved by the ruling, Sameer Overseas Placement Agency caused the filing of a petition for
certiorari with the Court of Appeals assailing the National Labor Relations Commission’s
resolutions dated March 31, 2004 and July 2, 2004.

ISSUE: WON Respondent Cabiles is entitled to her salary for the unexpired portion of the employment
contract.

RULING: YES.Respondent Joy Cabiles is entitled to her salary for the unexpired portion of her contract,
in accordance with Section 10 of Republic Act No. 8042. The award of the three-month equivalence of
respondent’s salary must be modified accordingly. Since she started working on June 26, 1997 and was
terminated on July 14, 1997, respondent is entitled to her salary from July 15, 1997 to June 25, 1998. “To
rule otherwise would be iniquitous to petitioner and other OFWs, and would, in effect, send a wrong
signal that principals/employers and recruitment/manning agencies may violate an OFW’s security of
tenure which an employment contract embodies and actually profit from such violation based on an
unconstitutional provision of law.”

Section 10 of Republic Act No. 8042, otherwise known as the Migrant Workers and Overseas Filipinos
Act of 1995, states that overseas workers who were terminated without just, valid, or authorized cause
“shall be entitled to the full reimbursement of his placement fee with interest of twelve (12%) per annum,
plus his salaries for the unexpired portion of his employment contract or for three (3) months for every
year of the unexpired term, whichever is less.”

The Court of Appeals affirmed the National Labor Relations Commission’s decision to award respondent
NT$46,080.00 or the three-month equivalent of her salary, attorney’s fees of NT$300.00, and the
reimbursement of the withheld NT$3,000.00 salary, which answered for her repatriation.We uphold the
finding that respondent is entitled to all of these awards. The award of the three-month equivalent of
respondent’s salary should, however, be increased to the amount equivalent to the unexpired
term of the employment contract.
In Serrano v. Gallant Maritime Services, Inc. and Marlow Navigation Co., Inc., this court ruled that the
clause “or for three (3) months for every year of the unexpired term, whichever is less” is unconstitutional
for violating the equal protection clause and substantive due process.A statute or provision which was
declared unconstitutional is not a law. It “confers no rights; it imposes no duties; it affords no protection;
it creates no office; it is inoperative as if it has not been passed at all.”Republic Act No. 10022 was
promulgated on March 8, 2010. This means that the reinstatement of the clause in Republic Act No. 8042
was not yet in effect at the time of respondent’s termination from work in 1997. Republic Act No. 8042
before it was amended by Republic Act No. 10022 governs this case.

E
Feagle Construction Corp. vs. Gayda
186 SCRA 589
Overseas Employment

Doctrine; Labor Standards– Recruiter not solidarily liable when workers agreed not to hold the
recruiter liable.

Facts: Herein respondents, 40 Filipino workers formerly employed with Algosaibi-Bison, Ltd., requested
petitioner recruiter to return them to their jobsite in Saudi Arabia. Petitioner corporation informed the
workers that It did not want to send back any workers because of high risk of financial difficulties of
Algosaibi-Bison Ltd. Respondent workers assured petitioner that they were willing to assume the risk
and emphasized that they were willing to sign a written statement indicating that they would not hold
petitioner corporation liable for any delay or non-payment of their salaries and any amounts due them
from Algosaibi-Bison, Ltd. It was under such circumstances that petitioner corporation reluctantly
agreed to send back private respondents to Saudi Arabia to help them in their dire financial need if they
would sign the aforementioned statements. When Algosaibi-Bison Ltd went into bankruptcy, private
respondents filed with the POEA a complaint against petitioner corporation for unpaid claims with the
liquidator of Algosaibi-Bison Ltd.

Issue: Whether petitioner may be held solidarily liable with the foreign employer as in the instant case.

Ruling: No. As a rule, a recruiter is solidarily liable with unpaid wages of workers sent abroad. The case
at bar is an exception because the workers persuaded the recruiter to send them back abroad despite
having knowledge that said foreign employer might not pay their wages and there was an express
agreement not to hold said recruiter responsible .

MACY

Overseas Employment
D. Prime Marine Services v NLRC

FACTS:Private respondent Napoleon Canut was recruited to work as a Tug Master for Arabian Gulf
Mechanical Services and Contracting Co., Ltd. (Arabian Gulf) by R & R Management Services
International (R & R Management) for a period of 18 months, commencing June 15, 1988. Private
respondent’s employment was, however, preterminated allegedly on the ground that he was incompetent.
When private respondent reviewed his employment papers, he discovered that while R & R Management
had acted as recruitment agency in processing his application, it was actually petitioner Prime Marine
Services, Inc., as deployment agent, which had processed his papers and facilitated his going abroad.
Further investigation showed that R & R Management was not licensed to recruit workers for overseas
employment. Accordingly, private respondent filed a complaint before the POEA for illegal dismissal,
underpayment of salaries, and recruitment violations against petitioner, R & R Management, and
Arabian Gulf. Petitioner denied that there was any employer-employee relationship between it and
private respondent. It pointed out that private respondent admitted he had applied with and paid his
placement fee to R & R Management. Petitioner likewise denied that it had any part in the processing of
private respondents papers and argued that only Arabian Gulf and R & R Management should be held
liable to private respondent.petitioner filed a cross-claim against R & R Management seeking
reimbursement for any amount which petitioner may be held liable for to private respondent. Cross claim
was dismissed for lack of merit

ISSUE:WON Prime Marine Services is liable to Canut

RULING:Yes. A private manning agency, such as petitioner, can be held liable for private respondents
claims. The Rules and Regulations of the POEA expressly provide that every applicant seeking a license
or authority to operate a private employment, recruitment, or manning agency must submit, among
others shall assume joint and solidary liability with the employer for all claims and liabilities which may
arise in connection with the implementation of the contract of employment

Who digested: jAn

Overseas Employment
Ilas v. NLRC
G.R. Nos. 90394-97, February 7, 1991

FACTS: Petitioners applied for overseas employment in Doha, Qatar, with CBT/Shiek International, an
unlicensed recruitment agency, under the management of spouses Ngoho. To enable them to leave, they
were assisted by Eddie Sumaway and Erlinda Espeno, the latter being a liaison officer of private
respondent All Seasons Manpower International Services, a licensed placement agency. Petitioners filed
their application papers and paid their placement fees with the Ngohos. However, it was Espeno who
processed their papers and gave them travel exit passes (TEPS). They were made to sign two-year
contracts of employment, but they were not given copies thereof. Subsequently, they were deployed to
Doha, Qatar, where they worked for four (4) months without being paid. They sought the assistance of
the Philippine Embassy and were able to come home to the Philippines with the help of the Philippine
Overseas Employment Administration (POEA).

ISSUE: W/N they can recover damages.

RULING: No. It is true that the rules and regulations of the POEA provide that the private employment
or recruitment agency is made to assume full and complete responsibility for all acts of its officials and
representatives done in connection with recruitment and placement.However, the observation of
public respondent that the documents used in the deployment abroad of petitioners were all
fake and that petitioners knew about it is borne by the records. They did not come to court with
clean hands. Thus, petitioners should suffer the consequences of their wrongful acts.

MAIN POINT: Bold

AR
CASE F
OVERSEAS EMPLOYMENT
JMM Promotion and Management, Inc. v. CA 260 SCRA 319

FACTS:Due to the death of one MaricrisSioson in 1991, Cory banned the deployment of performing
artists to Japan and other destinations. This was relaxed however with the introduction of the
Entertainment Industry Advisory Council which later proposed a plan to POEA to screen and train
performing artists seeking to go abroad. In pursuant to the proposal POEA and the secretary of DOLE
sought a 4 step plan to realize the plan which included an Artist’s Record Book which a performing artist
must acquire prior to being deployed abroad. The Federation of Talent Managers of the Philippines
assailed the validity of the said regulation as it violated the right to travel, abridge existing contracts and
rights and deprives artists of their individual rights. JMM intervened to bolster the cause of FETMOP.
The lower court ruled in favor of EIAC.

ISSUE: W/N the regulation by EIAC is valid.

HELD: YES. The SC ruled in favor of the lower court. The regulation is a valid exercise of police power.
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,Â
particularly, its ARB requirement, does not enhance the public welfare or was exercised arbitrarily or
unreasonably. 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.

ARZHY
Case G.
Article 280/Overseas Employment
Gu-Miro v. Adorable
FACTS:MarcialGu-Miro was formerly employed as a Radio Officer of respondent Bergesen D.Y.
Philippines on board its different vessels for a span of 10 years. On March 18, 1996, he signed an eight-
month-contract with the same company and commenced work on April 15, 1996. Respondent company
traditionally gave an incentive bonus termed as Re-employment Bonus to employees who decide to rejoin
the company after the expiration of their employment contracts. In September 1997 after the extension of
his service without formal signing of a contract, his service was terminated due to installation of labor
saving devices which made his services redundant. Upon his forced separation from the company, he
requested that he be given the incentive bonus plus the additional allowances he was entitled to.
Respondent company refused to accede to his request. On appeal before CA, petitioner argued that he
should be considered as a regular employee of respondent companyhaving been employed onboard the
latter’s different vessels for the span of 10 years thus, entitled to backwages, or at the very least,
separation pay.

ISSUE:Whether or not a seafarer who was continuously re-hired by a company can be considered a
regular employee

RULING:No.Petitioner cannot be considered as a regular employee notwithstanding that the work he

performs is necessary and desirable in the business of respondent company. As expounded in the case of
Millares, et al v. NLRC an exception is made in the situation of seafarers. The exigencies of their work
necessitates that they be employed on a contractual basis. Thus, even with the continued re-hiring by
respondent company of petitioner to serve as Radio Officer onboard Bergesen’s different vessels, this
should be interpreted not as a basis for regularization but rather a series of contract renewals sanctioned
under the doctrine set down by the second Millares case. If at all, petitioner was preferred because of
practical considerations—namely, his experience and qualifications. However, this does not alter the
status of his employment from being contractual.

With respect to the claim for backwages and separation pay, it is now well-settled that the award of
backwages and separation pay in lieu of reinstatement are reliefs that are awarded to an employee who
is unjustly dismissed. In the instant case, petitioner was separated from his employment due to the
termination of an impliedly renewed contract with respondent company. Hence, there is no illegal or
unjust dismissal.

MP:Seafarers not considered regular employees; The exigencies of their work necessitates that they be
employed on a contractual basis.

Case No. 18
AMOS-LRC vs. Laguesma
FACTS
AMOS-LRC a legitimate labor organization, filed a petition for certification election where the
Med-Arbiter issued an Order for the conduct of a certification election in the bargaining unit covering the
entire complement of four vessels. Petitioner contends that the marine officers in question must possess
the power to lay down and formulate management policies aside from just executing such policies. Said
marine officers do not have this power because they merely navigate the bay and rivers of Pasig and
Bataan hauling LPGs. They argued that:
1. the job descriptions submitted by private respondent Reyes and Lim Co., Inc and relied upon by
public respondent have no merit as the said positions possess no seamen's book, for they do not
traverse the high seas but merely the bay and rivers from Pasig to Bataan. They therefore, are not
covered by the job descriptions applicable to Filipino seafarers, but are ordinary workers
2. public respondent's determination of who are managerial employees constitutes a deprivation of
the worker's right to self-organization and free collective bargaining since such resolution is made
during pre-election conference on "inclusion-exclusion" proceedings

ISSUE
Whether or not the major patron, minor patron, chief mate and chief engineer of a vessel are
managerial employees

RULING/MAIN POINT
Yes. Public respondent Undersecretary of Labor has ruled that they are, contrary to petitioner
labor organization's contention that they are rank and file employees who may form part of the union.
The job description on record discloses that the major patron’s duties include taking complete charge and
command of the ship and performing responsibilities and duties of a ship captain; the minor patron also
commands the vessel, plying the limits of inland waterways, ports and estuaries; the chief mate performs
the functions of an executive officer next in command to the captain; and the chief marine engineer takes
over-all charge of the operations of the ship’s mechanical and electrical equipment. Thus, the exercise of
discretion and judgment in directing a ship’s course is as much managerial in nature as decisions arrived
at in the confines of the more conventional board room or executive office.
The functions which these officers discharge pertain to the navigation of the vessel. Even if there
are advanced communications equipment on board, the importance of the position of the officers in
assessing risks and evaluating the vessel's situation remains indisputable. The exercise of discretion and
judgment in directing a ship's course is as much managerial in nature as decisions arrived at in the
confines of the more conventional
WEE

Case No. 19

Article 82. FIELD PERSONNEL

Mercidar Fishing Corp. v. NLRC

FACTS: Private respondent, Fermin Agao, Jr., filed a complaint against petitioner for illegal dismissal,
violation of P.D. No. 851, and non-payment of five days service incentive leave. Private respondent had
been employed by petitioner as a "bodegero" or ship's quartermaster. He was allegedly on sick leave for
one month but when he reported to work, he was told to come back another time as he could not be
reinstated immediately. Thereafter, petitioner refused to give him work.

Petitioner, on the other hand, alleged that it was private respondent who actually abandoned his work. It
claimed that the latter failed to report for work after his leave had expired and was, in fact, absent
without leave for three months. Petitioner further claims that, nonetheless, that it assigned private
respondent to another vessel, but the latter was left behind. Thereafter, the Labor Arbiter rendered a
decision for private respondent’s reinstatement with backwages. Petitioner appealed to the NLRC which
was dismissed the appeal for lack of merit. The NLRC dismissed petitioner's claim that it cannot be held
liable for service incentive leave pay by fishermen in its employ as the latter supposedly are "field
personnel" and thus not entitled to such pay under the Labor Code.

ISSUE: Whether or not fishing crew members are deemed “field personnel” under Article 82 of the Labor
Code?

RULING: NO. Article 82 of the Labor Code provides:"Field personnel" shall refer to non-agricultural
employees who regularly perform their duties away from the principal place of business or branch office
of the employer and whose actual hours of work in the field cannot be determined with reasonable
certainty.

As provided for in the case of Union of Pilipro Employees (UFE) v. Vicar, it provides for the
determination of the clause "whose actual hours of work in the field cannot be determined with
reasonable certainty."In deciding whether or not an employee's actual working hours in the
field can be determined with reasonable certainty, query must be made as to whether or not
such employee's time and performance is constantly supervised by the employer.If the
employer has absolutely no way of reasonably ascertaining whether the employee is actually
doing field work during the stipulated period of work hours, then such worker is a field
personnel.

In contrast, in the case at bar, during the entire course of their fishing voyage, fishermen employed by
petitioner have no choice but to remain on board its vessel. Although they perform non-agricultural work
away from petitioner's business offices, the fact remains that throughout the duration of their work they
are under the effective control and supervision of petitioner through the vessel's patron or master as the
NLRC correctly held.