PART TWO - LABOR STANDARDS LAW

Purpose:

Mariveles Shipyard Corp v. CA

As an employer, the security agency is charged with knowledge of labor laws; and the adequacy of the
compensation that it demands for contractual services is its principal concern and not any other’s.

Section 1. Employment Policy

1.01 PRE – EMPLOYMENT POLICY -STATEMENT OF OBJECTIVES – Art. 12

Art. 12. Statement of objectives. It is the policy of the State:

a. To promote and maintain a state of full employment through improved manpower training,
allocation and utilization;

b. To protect every citizen desiring to work locally or overseas by securing for him the best possible
terms and conditions of employment;

c. To facilitate a free choice of available employment by persons seeking work in conformity with
the national interest;

d. To facilitate and regulate the movement of workers in conformity with the national interest;

e. To regulate the employment of aliens, including the establishment of a registration and/or work
permit system;

f. To strengthen the network of public employment offices and rationalize the participation of the
private sector in the recruitment and placement of workers, locally and overseas, to serve
national development objectives;

g. To insure careful selection of Filipino workers for overseas employment in order to protect the
good name of the Philippines abroad.

RA No. 10911 (2016) Anti-age Discrimination In Employment

It is a widespread and usual practice by companies to advertise jobs by indicating the preferred age and
other personal criteria for the positions they offer. As a result of the selective age preference,
employment opportunities were limited only to those who would fit the specified age group. However,
with Republic Act No. 10911 or the “Anti-age Discrimination In Employment Act

The Act mandates the elimination of age-based discrimination not only by employers, but also by labor
contractors or subcontractors. Echoing the mandate of the Philippine Constitution,

I. Policy:

1. Promote employment of individuals on the basis of their abilities, knowledge, skills and
qualifications rather than their age

2. Prohibit arbitrary age limitations in employment

3. Promote the right of all employees and workers, regardless of age, to be treated equally in
terms of compensation, benefits, promotion, training, and other employment opportunities

II. Prohibited Acts

II.1 When it comes to hiring of applicants, the Act prohibits

(1) printing or publishing of any notice or advertisement relating to employment which suggests age
preferences,

(2) requiring the applicant to disclose his/her age or birth date, and

(3) declining any employment applicant because of his/her age. Labor organizations are also proscribed
from denying membership of a person, or causing or attempting to cause an employer to discriminate
individuals on account of their age.

II.2 With regard to the status of an employee:

(1)employers are prohibited from discriminating an employee in terms of compensation, work terms
and conditions, privileges, promotion or training opportunities, by reason of age.

II.3 In terms of dismissal and retirement of employees,

(1)to forcibly lay off an employee or impose early retirement because of the employee's old age.

It must be noted that the Labor Code provides that any employee may be retired upon reaching the
retirement age established in the collective bargaining agreement or other applicable contract. In the
absence of such, an employee may retire at the optional retirement age of 60 (50 years for underground
mine workers) but not beyond the compulsory retirement age of 65 years. A retirement age lower than
60 is allowed provided the agreement is part of the collective bargaining agreement voluntarily entered
into and ratified by the employees (Pantranco North Express v. NLRC, G.R. No. 95940, 24 July 1996). It
appears that these rules still hold true, since R.A. No. 10911 neither amends nor repeals the Labor Code
other than requiring that there should not be any forcible early retirement motivated by age
discrimination.

Case law provides that, in the hiring, status, and dismissal or retirement of employees, the burden to
prove that there is discrimination is with the applicant or employee who alleges that he/she is denied
privileges or opportunities given to others under identical or similar conditions (Caltex [Phil.], Inc. v.
Philippine Labor Organization, G.R. No. L-5206, 29 April 1953). There must be clear proof then that such
denial was motivated by bad faith and discrimination on account of age.

Exempted Discriminations

On the other hand, the new law also admits certain exceptions and allows the setting of age limitations
by employers under the following circumstances:

1. When age is a bona fide occupational qualification (“BFOQ”) necessary in the normal operation
of a specific business, or where the differentiation depends on reasonable factors other than
age;

2. When the purpose is not to evade the law, but to observe the terms of a bona fide seniority
system, or employee retirement plan which is also in accordance with labor laws; or

3. When the action is certified by the Secretary of Labor and Employment in accordance with the
Act.

The concept of BFOQ is not new in Philippine labor law. One can say that the test of reasonableness is
parallel to it. For example, in the case Yrasuegui v. Philippine Airlines Inc. (G.R. No. 168081, 17 October
2008), the Supreme Court upheld the defense of BFOQ when the airline company dismissed a flight
steward whose weight was over the required set standard for the job. The Court held that the
company's weight standards are reasonable and necessary considering that public policy requires airline
companies to exercise extraordinary diligence for the safety of the passengers especially in case of
emergencies. In another case, the Court upheld the policy of a pharmaceutical company prohibiting
marriage with employees of rival companies because its purpose is to protect the company's trade
secrets and formula from being compromised and infiltrated (Duncan Association of Detailman-PTGWO
v. Glaxo Wellcome Philippines, Inc., G.R. No. 162994, 17 September 2004).

In order to justify the BFOQ defense, the employer must prove there is “compelling business necessity
for which no alternative exists other than the discriminatory practice” (Star Paper Corporation v. Simbol,
G.R. No. 164774, 12 April 2006). Ultimately, the test of whether the BOFQ defense is valid or not will
depend on the circumstances, even with the passage of R.A. No. 10911.

Penalties and Implementing Rules

The penalty for violators of the said Act shall be a fine ranging from PhP50,000 to PhP500,000, and/or
imprisonment of 3 months to 2 years.
As of date, the implementing rules and regulations (“IRR”) of the Act has yet to be crafted.

It is a well-settled rule that the determination of qualifications of applicants and employees for hiring,
promoting and dismissing is a prerogative of the management (NAFLU et. al. v NLRC, G.R. No. 90739, 3
October 1991). But while such prerogative is inherent in business enterprises, it is also subject to
limitations by law, collective bargaining agreements, and general principles of fairness and
justice (Norkis Trading Co., Inc. et.al. v Melvin Gnilo, G.R. No. 159730, 11 February 2008). At this
instance, the Act serves as a positive pronouncement for both employees and employers, that age-
based discrimination in employment is now undeniably unlawful.

Section 2. Recruitment And Placement Of Workers

“Recruitment and placement” refers to any act of canvassing, enlisting, contracting, transporting,
utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising
for employment, locally or abroad, whether for profit or not: Provided, That any person or entity which,
in any manner, offers or promises for a fee, employment to two or more persons shall be deemed
engaged in recruitment and placement.

Statutory reference: Art. 13-29

RULE III Recruitment and Placement

SECTION 1.Private recruitment. — No person or entity shall engage in the recruitment and placement of
workers either for local or overseas employment except the following:

(a) Public employment offices;

(b) Overseas Employment Development Board;

(c) National Seamen Board;

(d) Private recruitment offices;

(e) Private employment agencies;

(f) Shipping or manning agents or representatives; and

(g) Such other persons or entities as may be authorized by the Secretary.

SECTION 2. Ban on direct hiring. — No employer may hire a Filipino worker for overseas employment
except through the person or entities enumerated in the preceding section or as authorized by the law
or by the Secretary. Direct hiring by members of the diplomatic service, officials and employees of
international organizations and such other employers as may be authorized by the Secretary is
exempted from this provision. Such hirings shall be processed by the Overseas Employment
Development Board.
RULE IV Private Sector Participation in Recruitment and Placement

SECTION 1. Who may participate in the private sector. — Only the following persons or entities in the
private sector may engage in the recruitment and placement of workers either for local or overseas
employment:

(a) Private employment agencies;

(b) Private recruitment entities;

(c) Shipping or manning agents or representatives; and

(d) Such other persons or entities as may be authorized by the Secretary.

SECTION 2.Citizenship requirement. — Only Filipino citizens or corporations, partnerships or entities at

least seventy-five percent (75%) of the authorized and voting capital stock of which is owned and
controlled by Filipino citizens shall be permitted to participate in the recruitment and placement of
workers, locally or overseas.

SECTION 3.Action on application. — Within the thirty (30) days from the receipt of the application for
license, the Bureau shall recommend its denial or approval to the Secretary. Upon considering the
findings and recommendations of the Bureau, the Secretary may either deny or approve the application.
(Amended by POEA Rules and Regulations)

Private recruitment entities, Qualifications.

1. Citizenship

2. Appropriate capitalization

If still have time, check Guidelines

RA No. 10706 (2015) SEAFARERS PROTECTION ACT

AN ACT PROTECTING SEAFARERS AGAINST AMBULANCE CHASING AND IMPOSITION OF EXCESSIVE

FEES, AND PROVIDING PENALTIES THEREFOR

Declaration of Policy. —

1.to promote and protect every Filipino seafarer desiring to work overseas by securing the best possible
terms and conditions of employment. As some unscrupulous individuals have taken advantage of the
plight of our seafarers who met an accident, illness or death in the course of their service by exploiting
the compensation system, our seafarers have fallen prey to an unfair scheme where ambulance chasers
charge exorbitant fees, with the promise of huge monetary award. Towards this end, such practice shall
be declared unlawful.

SECTION 3. Prohibition on Ambulance Chasing. — It shall be unlawful for any person to engage in
ambulance chasing - the act of soliciting, personally or through an agent, from seafarers, or their heirs,
the pursuit of any claim against them employers for the purpose of recovery of monetary claim or
benefit, including legal interest, arising from accident, illness or death, in exchange of an amount or fee
which shall be retained or deducted from the monetary claim or benefit granted to or awarded to the
seafarers or their heirs.

SECTION 4. Imposition of Excessive Fees. — When any contract or arrangement between a seafarer or
his/her heirs, and a person who appears for or represents them in any case for recovery of monetary
claim or benefit, including legal interest, arising from accident, illness or death before the National Labor
Relations Commission (NLRC) or any labor arbiter, the National Conciliation and Mediation Board
(NCMB), the Philippine Overseas Employment Administration (POEA), the Department of Labor and
Employment (DOLE) or its regional offices, or other quasi-judicial bodies handling labor disputes
stipulates that the person who appears for or represents them shall be entitled to fees, such fees shall
not exceed ten percent (10%) of the compensation or benefit awarded to the seafarer or his/her heirs.

For purposes of this Act, fees referred to in this section shall mean the total amount of compensation of
the person who appears for or represents the seafarer, or his/her heirs for services rendered.

Definition – Law Structure

People v Panis

The view of the private respondents is that to constitute recruitment and placement, all the acts
mentioned in this article should involve dealings with two or m•re persons as an indispensable
requirement. On the other hand, the petitioner argues that the requirement of two or more persons is
imposed only where the recruitment and placement consists of an offer or promise of employment to
such persons and always in consideration of a fee. The other acts mentioned in the body of the article
may involve even only one person and are not necessarily for profit.

Neither interpretation is acceptable. We fail to see why the proviso should speak only of an offer or
promise of employment if the purpose was to apply the requirement of two or more persons to all the
acts mentioned in the basic rule. For its part, the petitioner does not explain why dealings with two or
more persons are needed where the recruitment and placement consists of an offer or promise of
employment but not when it is done through "canvassing, enlisting, contracting, transporting, utilizing,
hiring or procuring (of) workers.

As we see it, the proviso was intended neither to impose a condition on the basic rule nor to provide an
exception thereto but merely to create a presumption. The presumption is that the individual or entity is
engaged in recruitment and placement whenever he or it is dealing with two or more persons to whom,
in consideration of a fee, an offer or promise of employment is made in the course of the "canvassing,
enlisting, contracting, transporting, utilizing, hiring or procuring (of) workers. "
The number of persons dealt with is not an essential ingredient of the act of recruitment and placement
of workers. Any of the acts mentioned in the basic rule in Article 13(b) win constitute recruitment and
placement even if only one prospective worker is involved. The proviso merely lays down a rule of
evidence that where a fee is collected in consideration of a promise or offer of employment to two or
more prospective workers, the individual or entity dealing with them shall be deemed to be engaged in
the act of recruitment and placement. The words "shall be deemed" create that presumption.

It is unfortunate that we can only speculate on the meaning of the questioned provision for lack of
records of debates and deliberations that would otherwise have been available if the Labor Code had
been enacted as a statute rather than a presidential decree. The trouble with presidential decrees is that
they could be, and sometimes were, issued without previous public discussion or consultation, the
promulgator heeding only his own counsel or those of his close advisers in their lofty pinnacle of power.
The not infrequent results are rejection, intentional or not, of the interest of the greater number and, as
in the instant case, certain esoteric provisions that one cannot read against the background facts usually
reported in the legislative journals.

People v. Sualo

Yes. The Court finds that the trial court was justified in holding that accused-appellant was engaged in
unlawful recruitment and placement activities. The prosecution clearly established that accused-
appellant promised the three complainants - Benny Maligaya, Angeles Javier and Leodigario Maullon
employment in Taiwan as factory workers and that he asked them for money in order to process their
papers and procure their passports.

It is not disputed that accused-appellant is not authorized nor licensed by the Department of Labor and
Employment to engage in recruitment and placement activities. The absence of the necessary license or
authority renders all of accused-appellants recruitment activities criminal.

t is also well established in jurisprudence that a person may be charged and convicted for both illegal
recruitment and estafa. The reason for this is that illegal recruitment is a malum prohibitum, whereas
estafa is malum in se, meaning that the criminal intent of the accused is not necessary for conviction in
the former, but is required in the latter.

Overseas Employment

Overseas employment means employment of a worker outside the Philippines.

Eastern Shipping Lines v. POEA

Under the 1985 Rules and Regulations on Overseas Employment, overseas employment is defined as
"employment of a worker outside the Philippines, including employment on board vessels plying
international waters, covered by a valid contract.

A contract worker is described as "any person working or who has worked overseas under a valid
employment contract and shall include seamen" 4 or "any person working overseas or who has been
employed by another which may be a local employer, foreign employer, principal or partner under a
valid employment contract and shall include seamen." 5 These definitions clearly apply to Vitaliano Saco
for it is not disputed that he died while under a contract of employment with the petitioner and
alongside the petitioner's vessel, the M/V Eastern Polaris, while berthed in a foreign country

It is worth observing that the petitioner performed at least two acts which constitute implied or tacit
recognition of the nature of Saco's employment at the time of his death in 1985. The first is its
submission of its shipping articles to the POEA for processing, formalization and approval in the exercise
of its regulatory power over overseas employment under Executive Order NO. 797. 7 The second is its
payment 8 of the contributions mandated by law and regulations to the Welfare Fund for Overseas
Workers, which was created by P.D. No. 1694 "for the purpose of providing social and welfare services
to Filipino overseas workers."

Significantly, the office administering this fund, in the receipt it prepared for the private respondent's
signature, described the subject of the burial benefits as "overseas contract worker Vitaliano
Saco." 9 While this receipt is certainly not controlling, it does indicate, in the light of the petitioner's own
previous acts, that the petitioner and the Fund to which it had made contributions considered Saco to
be an overseas employee.

The petitioner argues that the deceased employee should be likened to the employees of the Philippine
Air Lines who, although working abroad in its international flights, are not considered overseas workers.
If this be so, the petitioner should not have found it necessary to submit its shipping articles to the POEA
for processing, formalization and approval or to contribute to the Welfare Fund which is available only
to overseas workers. Moreover, the analogy is hardly appropriate as the employees of the PAL cannot
under the definitions given be considered seamen nor are their appointments coursed through the
POEA.

Philsa International Placement v. Sec of Labor

Under Section 1, Rule 1, Book VI of the POEA Rules and Regulations, it will be seen that the POEA has
jurisdiction to decide all cases 'involving employer employee relations arising out of or by virtue of any
law or contract involving Filipino workers for overseas employment, including seamen."

Millares and Lagda v. NLRC

In Brent School Inc. v. Zamora,17 the Supreme Court stated that Article 280 of the Labor Code does not
apply to overseas employment.
Some familiar examples may be cited of employment contract which may be neither for seasonal
work nor for specific projects, but to which a fixed term is an essential and natural appurtenance:
overseas employment contracts, for one, to which, whatever the nature of the engagement, the
concept of regular employment with all that it implies does not appear ever to have been
applied. Article 280 of the Labor Code notwithstanding also appointments to the positions of dean,
assistant dean, college secretary, principal, and other administrative offices in educational institutions,
which are by practice or tradition rotated among the faculty members, and where fixed terms are a
necessity without which no reasonable rotation would be possible. Similarly, despite the provisions of
Article 280, Policy Instructions. No. 8 of the Minister of Labor implicitly recognize that certain company
officials may be elected for what would amount to fix periods, at the expiration of which they would
have to stand down, in providing that these officials, xxx may lose their jobs as president, executive vice-
president or vice-president, etc. because the stockholders or the board of directors for one reason or
another did not reelect them.

Tierra Intl Corp v NLRC

Termination of an employee’s services because of a reduction of work force due to a decrease in the
scope or volume of work of the employer is synonymous to, or a shade of termination because of
redundancy under Article 283 (formerly 284) of the Labor Code. Redundancy exists where the services
of an employee are in excess of what is reasonably demanded by the actual requirements of the
enterprise. A position is redundant where it is superfluous, and superfluity of a position or positions may
be the outcome of a number of factors, such as overhiring of workers, decreased volume of business, or
dropping of a particular product line or service activity previously manufactured or undertaken by the
enterprise.

In redundancy, what is looked into is the position itself, the nature of the services performed by the
employee and the necessity of such position. As held in Wiltshire File Co., Inc.

Article XIII (a) of the employment contract between the parties provides that where an employee is
terminated because of a reduction of work force, the employer will be responsible for the employee’s
return transportation to his point of hire. There is no mention of an award of separation pay similar to
that provided for in Article 283 of the Labor Code.

But as admitted by petitioner itself, Article 283 of the Labor Code governs its employer-employee
relationship with the private respondent as the same is deemed written in the employment contract
signed by the parties. Thus, although a contract is the law between the parties, thereto, the provisions
of law which regulate such contracts are deemed included and shall limit and govern the relations
between the parties. 17

In Abella v. NLRC, 18 the Court held that not only are existing laws read into contracts in order to fix the
obligations as between the parties, but the reservation of essential attributes of sovereign power is also
read into contracts as a postulate of the legal order.

In ordering the petitioner to pay private respondent the sum of US $680.00 which is equivalent to his
one (1) month salary by way of separation pay, POEA Administrator Achacoso was merely exercising the
following powers mandated on the POEA by E.O. 247.

(c) Protect the rights of Filipino workers for overseas employment to fair and equitable recruitment and
employment practices and ensure their welfare;.

(i) Secure the best terms and conditions of employment of Filipino contract workers and ensure
compliance therewith;

(j) Promote and protect the well-being of Filipino workers overseas;

Lastly, on the amount of salaries due private respondent, the rule has always been that an illegally
dismissed worker whose employment is for a fixed period is entitled to payment of his salaries
corresponding to the unexpired portion of his employment.27 However on 15 July 1995, RA 8042
otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995" took effect, Sec. 10 of
which provides:

Sec. 10. In case of termination of overseas employment without just, valid or authorized cause as
defined by law or contract, the worker shall be entitled to the full reimbursement of his placement fee
with interest at twelve percent (12%) per annum, plus his salaries for the unexpired portion of the
employment contract or for three (3) months for every year of the unexpired term whichever is
less (emphasis ours).

The Labor Arbiter, rationalizing that the aforesaid law did not apply since it became effective only one
(1) month after respondent's overseas employment contract was entered into on 15 June 1995, simply
awarded private respondent his salaries corresponding to the unexpired portion of his employment
contract, i.e., for 8.6 months. The NLRC affirmed the award and the Office of the Solicitor General (OSG)
fully agreed. But petitioners now insist that Sec. 10, RA 8042 is applicable because although private
respondent's contract of employment was entered into before the law became effective his alleged
cause of action, i.e., his repatriation on 28 September 1995 without just, valid or authorized cause,
occurred when the law was already in effect. Petitioners' purpose in so arguing is to invoke the law in
justifying a lesser monetary award to private respondent, i.e., salaries for three (3) months only
pursuant to the last portion of Sec. 10 as opposed to the salaries for 8.6 months awarded by the Labor
Arbiter and affirmed by the NLRC.

We agree with petitioners that Sec. 10, RA 8042, applies in the case of private respondent and to all
overseas contract workers dismissed on or after its effectivity on 15 July 1995 in the same way that Sec.
34,28 RA 6715,29 is made applicable to locally employed workers dismissed on or after 21 March
1989.30 However, we cannot subscribe to the view that private respondent is entitled to three (3)
months' salary only. A plain reading of Sec. 10 clearly reveals that the choice of which amount to award
an illegally dismissed overseas contract worker, i.e., whether his salaries for the unexpired portion of his
employment contract or three (3) months' salary for every year of the unexpired term, whichever is less,
comes into play only when the employment contract concerned has a term of at least one (1) year or
more. This is evident from the words "for every year of the unexpired term" which follows the words
"salaries . . . for three months." To follow petitioners' thinking that private respondent is entitled to
three (3) months salary only simply because it is the lesser amount is to completely disregard and
overlook some words used in the statute while giving effect to some. This is contrary to the well-
established rule in legal hermeneutics that in interpreting a statute, care should be taken that every part
or word thereof be given effect31 since the law-making body is presumed to know the meaning of the
words employed in the statue and to have used them advisedly.32 Ut res magis valeat quam pereat.33

Athenna International Manpower Services v. Villalos

SEC. 10. Money Claims. - . . .

In case of termination of overseas employment without just, valid or authorized cause as defined by law
or contract, the worker shall be entitled to the full reimbursement of his placement fee 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.

...

Thus, for the computation of the lump-sum salary due an illegally dismissed overseas employee, there
are two clauses as points of reckoning: first is the cumulative salary for the unexpired portion of his
employment; and the other is the grant of three months salary for every year of the unexpired term,
whichever is lesser.

Since respondent was dismissed after only one month of service, the unexpired portion of his contract is
admittedly one year, nine months and twenty-eight days. But the applicable clause is not the first but
the second: three months salary for every year of the unexpired term, as the lesser amount, hence it is
what is due the respondent.

Note that the fraction of nine months and twenty-eight days is considered as one whole year following
the Labor Code. Thus, respondent's lump-sum salary should be computed as follows:

3 months x 2 (years) = 6 months worth of salary

6 months x (NT$) 15,840 = NT$95,040, subject to proper conversion to Philippine currency by Labor
Arbiter Cresencio Iniego.

Under the aforequoted provision, an illegally dismissed overseas worker is also entitled to the full
reimbursement of his placement fee with interest at twelve percent (12%) per annum.
We note that while respondent was assessed P94,000 in placement fee, he paid only P30,000 on the
agreement that the balance of P64,000 would be paid on a monthly salary deduction upon his
deployment. Hence, we cannot grant respondent reimbursement of the entire assessed amount
of P94,000. He is only entitled to the reimbursement of the amount of placement fee he actually paid,
which is the P30,000 he gave as downpayment plus interest at twelve percent (12%) per annum.

Norse Management Corp v. National Seamen Board

Furthermore, Article 20, Labor Code of the Philippines, provides that the National Seamen Board has
original and exclusive jurisdiction over all matters or cases including money claims, involving employer-
employee relations, arising out of or by virtue of any law or contracts involving Filipino seamen for
overseas employment. Thus, it is safe to assume that the Board is familiar with pertinent Singapore
maritime laws relative to workmen's compensation. Moreover, the Board may apply the rule on judicial
notice and, "in administrative proceedings, the technical rules of procedure — particularly of evidence
— applied in judicial trials, do not strictly apply."

NFD international manning agents v. NLRC

Section 17 sets forth the disciplinary procedures against erring seafarers, to wit:

Section 17. DISCIPLINARY PROCEDURES

The Master shall comply with the following disciplinary procedures against an erring seafarer:

A. The Master shall furnish the seafarer with a written notice containing the following:

1. Grounds for the charges as listed in Section 31 of this Contract.

2. Date, time and place for a formal investigation of the charges against the seafarer concerned.

B. The Master or his authorized representative shall conduct the investigation or hearing, giving the
seafarer the opportunity to explain or defend himself against the charges. An entry on the investigation
shall be entered into the ship's logbook.

C. If, after the investigation or hearing, the Master is convinced that imposition of a penalty is justified,
the Master shall issue a written notice of penalty and the reasons for it to the seafarer, with copies
furnished to the Philippine agent.

D. Dismissal for just cause may be effected by the Master without furnishing the seafarer with a
notice of dismissal if doing so will prejudice the safety of the crew or the vessel. This information shall
be entered in the ship's logbook. The Master shall send a complete report to the manning agency
substantiated by witnesses, testimonies and any other documents in support thereof. (Emphasis
supplied)cralawlibrary
Under paragraph D, Section 17 of the Revised Standard Employment Terms and Conditions Governing
the Employment of Filipino Seafarers on Board Ocean-Going Vessels, the Ship Master is excused from
furnishing a seafarer with the required notice of dismissal if doing so will prejudice the safety of the
crew and the vessel, as in cases of mutiny.

Explaining the notice requirements under Section 17, this Court held in Skippers Pacific, Inc. v.
Mira,43 that :

x x x under Section 17 of what is termed the Standard Format, the "two-notice rule" is indicated. An
erring seaman is given a written notice of the charge against him and is afforded an opportunity to
explain or defend himself. Should sanctions be imposed, then a written notice of penalty and the
reasons for it shall be furnished the erring seafarer. It is only in the exceptional case of clear and
existing danger to the safety of the crew or vessel that the required notices are dispensed with; but
just the same, a complete report should be sent to the manning agency, supported by substantial
evidence of the findings.

However, in the instant case, petitioners failed to establish that private respondents and their
companions were guilty of mutiny or that, in any other manner, they posed a clear and present danger
to the vessel and its crew which would have justified the Ship Master in dispensing with the required
notices. Even if the Ship Master was justified in dispensing with the notice requirements, still, it was
essential that his decision to dismiss the Filipino seamen should have been entered in the ship's
logbook; and that a complete report, substantiated by witnesses, testimonies and any other documents
in support thereof, duly sent to the manning agency. The record of this case is bereft of any such entry
in the ship's logbook or journal and of any report and supporting documents. Instead, respondents and
the other Filipino seamen were verbally ordered to disembark from the vessel and were repatriated to
the Philippines without being given written notice of the reasons why.

There being no mutiny, petitioners should have complied with Section 17A quoted above.

Philippine Intl Shipping Corp v. NLRC

While it is true that Republic Act No. 529 makes it unlawful to require payment of domestic obligations
in foreign currency, this particular statute is not applicable to the case at bar. A careful reading of the
decision rendered by the Executive Director of the NSB dated April 2, 1981 and which led to the Writ of
Execution protested to by petitioner, will readily disclose that the award to the private respondent does
not compel payment in dollar currency but in fact expressly allows payment of "its equivalent in
Philippine currency." (Rollo, p. 14)

Moreover, as pointed out by public respondent, without any subsequent controversion interposed by
petitioner, the fixing of the award in dollars was based on the parties employment contract, stipulating
wages and benefits in dollars since private respondent was engaged in an overseas seaman on board
petitioner's foreign vessel. (Comment of respondent NLRC to the Petition, pg. 10, Rollo, 49)
Accordingly, we fail to see any violation of R.A. No. 529.

As to petitioner's principal contention that its payment of P18,000.00 under the document of release
executed by private respondent constitutes full satisfaction of the award, We uphold the ruling of the
public respondent NLRC on this matter and find no error, much less grave abuse of discretion on the
part of respondent NLRC in rejecting such assertion.

Article 20: National Seamen Board

Virjen Shipping and Marine Services v. NLRC

Prescinding from the above, we now hold that neither the National Seamen Board nor the National
Labor Relations Commission should, as a matter of official policy, legitimize and enforce cubious
arrangements where shipowners and seamen enter into fictitious contracts similar to the addendum
agreements or side contracts in this case whose purpose is to deceive. The Republic of the Philippines
and its ministries and agencies should present a more honorable and proper posture in official acts to
the whole world, notwithstanding our desire to have as many job openings both here and abroad for
our workers. At the very least, such as sensitive matter involving no less than our dignity as a people and
the welfare of our workingmen must proceed from the Batasang Pambansa in the form of policy
legislation, not from administrative rule making or adjudication

Regulations of Recruitment and Placement Activities

Eastern Assurance and Surety Corp v. Sec of Labor

The complaints are however for violation of Articles 32 and 34 a) of the Labor Code. Article 32 and
paragraph (a) of Article 34 read as follows:

Art. 32. Fees to be paid by workers.—Any person applying with a private fee-charging employment
agency for employment assistance shall not be charged any fee until he has obtained employment
through its efforts or has actually commenced employment. Such fee shall be always covered with the
approved receipt clearly showing the amount paid. The Secretary of Labor shall promulgate a schedule
of allowable fees.

Art. 34. Prohibited practices.—It shall be unlawful for any individual, entity, licensee, or holder of
authority:

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, or to make a worker pay any amount greater than
actually received by him as a loan or advance; . . .

The penalties of suspension and cancellation of license or authority are prescribed for violations of the
above quoted provisions, among others. And the Secretary of Labor has the power under Section 35 of
the law to apply these sanctions, as well as the authority, conferred by Section 36, not only, to "restrict
and regulate the recruitment and placement activities of all agencies," but also to "promulgate rules and
regulations to carry out the objectives and implement the provisions" governing said activities. Pursuant
to this rule-making power thus granted, the Secretary of Labor gave the POEA 9 "on its own initiative or
upon filing of a complaint or report or upon request for investigation by any aggrieved person, . . .
(authority to) conduct the necessary proceedings for the suspension or cancellation of the license or
authority of any agency or entity" for certain enumerated offenses including —

1) the imposition or acceptance, directly or indirectly, of any amount of money, goods or services, or any
fee or bond in excess of what is prescribed by the Administration, and

2) any other violation of pertinent provisions of the Labor Code and other relevant laws, rules and
regulations. 10

The Administrator was also given the power to "order the dismissal of the case or the suspension of the
license or authority of the respondent agency or contractor or recommend to the Minister the
cancellation thereof." 11

Implicit in these powers is the award of appropriate relief to the victims of the offenses committed by
the respondent agency or contractor, specially the refund or reimbursement of such fees as may have
been fraudulently or otherwise illegally collected, or such money, goods or services imposed and
accepted in excess of what is licitly prescribed. It would be illogical and absurd to limit the sanction on
an offending recruitment agency or contractor to suspension or cancellation of its license, without the
concomitant obligation to repair the injury caused to its victims. It would result either in rewarding
unlawful acts, as it would leave the victims without recourse, or in compelling the latter to litigate in
another forum, giving rise to that multiplicity of actions or proceedings which the law abhors.

Even more untenable is EASCO's next argument that the recruiter and its victims are in pari delicto —
the former for having required payment, and the latter for having voluntarily paid, "prohibited
recruitment fees" — and therefore, said victims are barred from obtaining relief. The sophistical, if not
callous, character of the argument is evident upon the most cursory reading thereof; it merits no
consideration whatever.

Salazar v. Achacoso

This concerns the validity of the power of the Secretary of Labor to issue warrants of arrest and seizure
under Article 38 of the Labor Code, prohibiting illegal recruitment.

For the guidance of the bench and the bar, we reaffirm the following principles:

1. Under Article III, Section 2, of the l987 Constitution, it is only judges, and no other, who may issue
warrants of arrest and search:
2. The exception is in cases of deportation of illegal and undesirable aliens, whom the President or the
Commissioner of Immigration may order arrested, following a final order of deportation, for the purpose
of deportation.

We reiterate that the Secretary of Labor, not being a judge, may no longer issue search or arrest
warrants. Hence, the authorities must go through the judicial process. To that extent, we declare Article
38, paragraph (c), of the Labor Code, unconstitutional and of no force and effect.

Article 34, Prohibitied Practices

Soriano v. Offshore Shipping and Manning Corp

Article 34 paragraph (i) of the Labor Code reads:

Prohibited Practices. — It shall be unlawful for any individual, entity, licensee, or holder of authority:

xxxx

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

In the case at bar, both the Labor Arbiter and the National Labor Relations Commission correctly
analyzed the questioned annotations as not constituting an alteration of the original employment
contract but only a clarification thereof which by no stretch of the imagination can be considered a
violation of the above-quoted law. Under similar circumstances, this Court ruled that as a general
proposition, exceptions from the coverage of a statute are strictly construed. But such construction
nevertheless must be at all times reasonable, sensible and fair. Hence, to rule out from the exemption
amendments set forth, although they did not materially change the terms and conditions of the original
letter of credit, was held to be unreasonable and unjust, and not in accord with the declared purpose of
the Margin Law. 19

The purpose of Article 34, paragraph 1 of the Labor Code is clearly the protection of both parties. In the
instant case, the alleged amendment served to clarify what was agreed upon by the parties and
approved by the Department of Labor. To rule otherwise would go beyond the bounds of reason and
justice.

As recently laid down by this Court, the rule that there should be concern, sympathy and solicitude for
the rights and welfare of the working class, is meet and proper. That in controversies between a laborer
and his master, doubts reasonably arising from the evidence or in the interpretation of agreements and
writings should be resolved in the former's favor, is not an unreasonable or unfair rule. 20 But to
disregard the employer's own rights and interests solely on the basis of that concern and solicitude for
labor is unjust and unacceptable.

Finally, it is well-settled that factual findings of quasi-judicial agencies like the National Labor Relations
Commission which have acquired expertise because their jurisdiction is confined to specific matters are
generally accorded not only respect but at times even finality if such findings are supported by
substantial evidence.21

In fact since Madrigal v. Rafferty great weight has been accorded to the interpretation or construction
of a statute by the government agency called upon to implement the same.

Seagull Maritime Corp v. balatongan

The supplementary contract of employment was entered into between petitioner and private
respondent to modify the original contract of employment The reason why the law requires that the
POEA should approve and verify a contract under Article 34(i) of the Labor Code is to insure that the
employee shall not thereby be placed in a disadvantageous position and that the same are within the
minimum standards of the terms and conditions of such employment contract set by the POEA. This is
why a standard format for employment contracts has been adopted by the Department of Labor.
However, there is no prohibition against stipulating in a contract more benefits to the employee than
those required by law. Thus, in this case wherein a "supplementary contract" was entered into affording
greater benefits to the employee than the previous one, and although the same was not submitted for
the approval of the POEA, the public respondents properly considered said contract to be valid and
enforceable. Indeed, said pronouncements of public respondents have the effect of an approval of said
contract. Moreover, as said contract was voluntarily entered into by the parties the same is binding
between them. 11 Not being contrary to law, morals, good customs, public policy or public order, its
validity must be sustained. 12 By the same token, the court sustains the ruling of public respondents that
the provision in the supplementary contract whereby private respondent waives any claim against
petitioners for damages arising from death or permanent disability is against public policy, oppressive
and inimical to the rights of private respondent. The said provision defeats and is inconsistent with the
duty of petitioners to insure private respondent against said contingencies as clearly stipulated in the
said contract.

Article 35: Suspension and/or Cancellation of License or Authority

Royale Crown Intl v. NLRC

In applying for its license to operate a private employment agency for overseas recruitment and
placement, petitioner was required to submit, among others, a document or verified undertaking
whereby it assumed all responsibilities for the proper use of its license and the implementation of the
contracts of employment with the workers it recruited and deployed for overseas employment [Section
2(e), Rule V, Book 1, Rules to Implement the Labor Code (1976)]. It was also required to file with the
Bureau a formal appointment or agency contract executed by the foreign-based employer in its favor to
recruit and hire personnel for the former, which contained a provision empowering it to sue and be sued
jointly and solidarily with the foreign principal for any of the violations of the recruitment agreement and
the contracts of employment [Section 10 (a) (2), Rule V, Book I of the Rules to Implement the Labor Code
(1976)]. Petitioner was required as well to post such cash and surety bonds as determined by the
Secretary of Labor to guarantee compliance with prescribed recruitment procedures, rules and
regulations, and terms and conditions of employment as appropriate [Section 1 of Pres. Dec. 1412
(1978) amending Article 31 of the Labor Code].

Facilities Management Corp v. Dela Rosa

(d) While plaintiff is a foreign corporation without license to transact business in the Philippines, it does
not follow that it has no capacity to bring the present action. Such license is not necessary because it is
not engaged in business in the Philippines. In fact, the transaction herein involved is the first business
undertaken by plaintiff in the Philippines, although on a previous occasion plaintiff's vessel was
chartered by the National Rice and Corn Corporation to carry rice cargo from abroad to the Philippines.
These two isolated transactions do not constitute engaging in business in the Philippines within the
purview of Sections 68 and 69 of the Corporation Law so as to bar plaintiff from seeking redress in our
courts.

EMPLOYMENT AGENCY

“Private fee-charging employment agency” means any person or entity engaged in recruitment and
placement of workers for a fee which is charged, directly or indirectly, from the workers or employers or
both.

“License” means a document issued by the Department of Labor authorizing a person or entity to
operate a private employment agency.
“Private recruitment entity” means any person or association engaged in the recruitment and placement
of workers, locally or overseas, without charging, directly or indirectly, any fee from the workers or
employers.

“Authority” means a document issued by the Department of Labor authorizing a person or association
to engage in recruitment and placement activities as a private recruitment entity.

ALLOWED ENTITIES

A. General Rule

Art. 16. Private recruitment. Except as provided in Chapter II of this Title, no person or entity other than
the public employment offices, shall engage in the recruitment and placement of workers.

Art. 18. Ban on direct-hiring. No employer may hire a Filipino worker for overseas employment except
through the Boards and entities authorized by the Secretary of Labor. Direct-hiring by members of the
diplomatic corps, international organizations and such other employers as may be allowed by the
Secretary of Labor is exempted from this provision.

Art. 25. Private sector participation in the recruitment and placement of workers. Pursuant to national
development objectives and in order to harness and maximize the use of private sector resources and
initiative in the development and implementation of a comprehensive employment program, the
private employment sector shall participate in the recruitment and placement of workers, locally and
overseas, under such guidelines, rules and regulations as may be issued by the Secretary of Labor.

Pre Employment, Policy of the State:

Art. 12 (f): To strengthen the network of public employment offices and rationalize the participation of
the private sector in the recruitment and placement of workers, locally and overseas, to serve national
development objectives
PROHIBITED ENTITY

Art. 16. Private recruitment. Except as provided in Chapter II of this Title, no person or entity other than
the public employment offices, shall engage in the recruitment and placement of workers

Art. 18. Ban on direct-hiring. No employer may hire a Filipino worker for overseas employment except
through the Boards and entities authorized by the Secretary of Labor. Direct-hiring by members of the
diplomatic corps, international organizations and such other employers as may be allowed by the
Secretary of Labor is exempted from this provision.

Art. 26. Travel agencies prohibited to recruit. Travel agencies and sales agencies of airline companies
are prohibited from engaging in the business of recruitment and placement of workers for overseas
employment whether for profit or not.

TECHNIQUES OF REGULATION

License

People v. Buli-E

Art. 29. Non-transferability of license or authority No license or authority shall be used directly or
indirectly by any person other than the one in whose favor it was issued or at any place other than that
stated in the license or authority, nor may such license or authority be transferred, conveyed or assigned
to any other person or entity. Any transfer of business address, appointment or designation of any agent
or representative including the establishment of additional offices anywhere shall be subject to the prior
approval of the Secretary of Labor.

ILLEGAL RECRUITMENT
Art. 38. Illegal recruitment.

a. Any recruitment activities, including the prohibited practices enumerated under Article 34 of
this Code, to be undertaken by non-licensees or non-holders of authority, shall be deemed
illegal and punishable under Article 39 of this Code. The Department of Labor and Employment
or any law enforcement officer may initiate complaints under this Article.

b. Illegal recruitment when committed by a syndicate or in large scale shall be considered an

offense involving economic sabotage and shall be penalized in accordance with Article 39
hereof.

Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or
more persons conspiring and/or confederating with one another in carrying out any unlawful or
illegal transaction, enterprise or scheme defined under the first paragraph hereof. Illegal
recruitment is deemed committed in large scale if committed against three (3) or more persons
individually or as a group.

c. The Secretary of Labor and Employment or his duly authorized representatives shall have the
power to cause the arrest and detention of such non-licensee or non-holder of authority if after
investigation it is determined that his activities constitute a danger to national security and
public order or will lead to further exploitation of job-seekers. The Secretary shall order the
search of the office or premises and seizure of documents, paraphernalia, properties and other
implements used in illegal recruitment activities and the closure of companies, establishments
and entities found to be engaged in the recruitment of workers for overseas employment,
without having been licensed or authorized to do so.

Art. 34. Prohibited practices. It shall be unlawful for any individual, entity, licensee, or holder of
authority:

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, or to make a worker pay 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 this Code.
 d. To induce or attempt to induce a worker already employed to quit his employment in order to
offer him to another unless the transfer is designed to liberate the worker from oppressive
terms and conditions of employment;

e. To influence or to attempt to influence any person or entity not to employ any worker who has
not applied for employment through his agency;

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;

g. To obstruct or attempt to obstruct inspection by the Secretary of Labor or by his duly authorized
representatives;

h. To fail to file 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.

i. To substitute or alter employment contracts approved and verified by the Department of Labor
from the time of actual signing thereof by the parties up to and including the periods of
expiration of the same without the approval of the Secretary of Labor;

j. 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 a travel agency; and

k. To withhold or deny travel documents from applicant workers before departure for monetary or
financial considerations other than those authorized under this Code and its implementing rules
and regulations.

Sec. 6.DEFINITIONS. - For purposes of this Act, illegal recruitment shall mean any act of canvassing,
enlisting, contracting, transporting, utilizing, hiring, procuring workers and includes referring, contact
services, promising or advertising for employment abroad, whether for profit or not, when undertaken
by a non-license 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 such non-license
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. It shall likewise include the following acts, whether committed by
any persons, whether a non-licensee, non-holder, licensee or holder of authority.

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

(d) To induce 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 persons or entity not to employ any worker who has not
applied for employment through his agency;

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

(g) To obstruct or attempt to obstruct inspection by the Secretary of Labor and Employment or by his
duly authorized representative;

(h) To fail to submit reports on the status of employment, placement vacancies, remittances of foreign
exchange earnings, separations 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 on indirectly in the
management of a travel agency;

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

(l) Failure to actually deploy without valid reasons as determined by the Department of Labor and
Employment; and

(m) Failure to reimburse expenses incurred by the workers 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 as offense involving economic sabotage.

Illegal recruitment is deemed committed by a syndicate 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.
The persons criminally liable for the above offenses are the principals, accomplices and accessories. In
case of juridical persons, the officers having control, management or direction of their business shall be
liable.