Bright Maritime Corporation (BMC) vs.

Fantonial way of example or correction for the public good in view of petitioner’s act of
665 SCRA 350, G.R. No. 165935 February 8, 2012
Labor Law; Employment Contracts; Perfection of an Employment Contract.—An
employment contract, like any other contract, is perfected at the moment (1) the
parties come to agree upon its terms; and (2) concur in the essential elements
thereof: (a) consent of the contracting parties, (b) object certain which is the subject
matter of the contract, and (c) cause of the obligation. The object of the contract was
the rendition of service by respondent on board the vessel for which service he would
be paid the salary agreed upon.
Same; Same; Seafarers; The employment contract did not commence when the
petitioner therein, a hired seaman, was not able to depart from the airport or seaport
in the point of hire; thus, no employer-employee relationship was created between
the parties.—In Santiago v. CF Sharp Crew Management, Inc., 527 SCRA 165 (2007),
the Court held that the employment contract did not commence when the petitioner
therein, a hired seaman, was not able to depart from the airport or seaport in the
point of hire; thus, no employer-employee relationship was created between the
parties. Nevertheless, 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. If the reverse happened, that is, the seafarer failed or
refused to be deployed as agreed upon, he would be liable for damages.
preventing respondent from being deployed on the ground that he was not yet
declared fit to work on the date of his departure, despite evidence to the contrary.
Such act, if tolerated, would prejudice the employment opportunities of our seafarers
who are qualified to be deployed, but prevented to do so by a manning agency for
unjustified reasons. Exemplary damages are imposed not to enrich one party or
impoverish another, but to serve as a deterrent against or as a negative incentive to
curb socially deleterious actions. In this case, petitioner should be held liable to
respondent for exemplary damages in the amount of P50,000.00, following the
recent case of Claudio S. Yap v. Thenamaris Ship’s Management, et al., 649 SCRA 369
(2011), instead of P10,000.00
Same; Same; Attorney’s Fees; Attorney’s fees are recoverable when the defendant’s
act or omission has compelled the plaintiff to incur expenses to protect his interest.—
The Court also holds that respondent is entitled to attorney’s fees in the concept of
damages and expenses of litigation. Attorney’s fees are recoverable when the
defendant’s act or omission has compelled the plaintiff to incur expenses to protect
his interest. Petitioners’ failure to deploy respondent based on an unjustified ground
forced respondent to file this case, warranting the award of attorney’s fees
equivalent to ten percent (10%) of the recoverable amount.

Same; Same; Same; Petitioners’ act of preventing respondent from leaving and
complying with his contract of employment constitutes breach of contract.—
Petitioners’ act of preventing respondent from leaving and complying with his
contract of employment constitutes breach of contract for which petitioner BMC is
liable for actual damages to respondent for the loss of one-year salary as provided in
the contract. The monthly salary stipulated in the contract is US$670, inclusive of
allowance.

Same; Same; Damages; Moral Damages; The Court upholds the award of moral
damages in the amount of P30,000.00, as the Court of Appeals correctly found
petitioners’ act was tainted with bad faith.—The Court upholds the award of moral
damages in the amount of P30,000.00, as the Court of Appeals correctly found
petitioners’ act was tainted with bad faith, considering that respondent’s Medical
Certificate stated that he was fit to work on the day of his scheduled departure, yet
he was not allowed to leave allegedly for medical reasons.

Same; Same; Same; Exemplary Damages; Exemplary damages are imposed by way of
example or correction for the public good in view of petitioner’s act of preventing
respondent from being deployed.—The Court agrees with the Court of Appeals that
petitioner BMC is liable to respondent for exemplary damages, which are imposed by
 San Miguel Corporation vs. NLRC
161 SCRA 719, No. L-80774 May 31, 1988
Labor Relations; Statutory Construction; Rule of Noscitur a sociis may be usefully
invoked in clarifying the scope of Art. 217 of the Labor Code; “Money claims of
workers” referred to in paragraph 3 of Art, 217 embraces money claims which arise
out of or in connection with the employer-employee relationship; Reasons.—While
paragraph 3 above refers to “all money claims of workers,” it is not necessary to
suppose that the entire universe of money claims that might be asserted by workers
against their employers has been absorbed into the original and exclusive jurisdiction
of Labor Arbiters. In the first place, paragraph 3 should be read not in isolation from
but rather within the context formed by paragraph 1 (relating to unfair labor
practices), paragraph 2 (relating to claims concerning terms and conditions of
employment), paragraph 4 (claims relating to household services, a particular species
of employer-employee relations), and paragraph 5 (relating to certain activities
prohibited to employees or to employers). It is evident that there is a unifying
element which runs through paragraphs 1 to 5 and that is, that they all refer to cases
or disputes arising out of or in connection with an employer-employee relationship.
This is, in other words, a situation where the rule of noscitur a sociis may be usefully
invoked in clarifying the scope of paragraph 3, and any other paragraph .of Article
217 of the Labor Code, as amended. We reach the above conclusion from an
examination of the terms themselves of Article 217, as last amended by B.P. Blg. 227,
and even though earlier versions of Article 217 of the Labor Code expressly brought
within the jurisdiction of the Labor Arbiters and the NLRC “cases arising from
employer-employee relations,” which clause was not expressly carried over, in
printer’s ink, in Article 217 as it exists today. For it cannot be presumed that money
claims of workers which do not arise out of or in connection with their employer-
employee relationship, and which would therefore fall within the general jurisdiction
of the regular courts of justice, were intended by the legislative authority to be taken
away from the jurisdiction of the courts and lodged with Labor Arbiters on an
exclusive basis. The Court, therefore, believes and so holds that the “money claims
of workers” referred to in paragraph 3 of Article 217 embraces money claims which
arise out of or in connection with the employer-employee relationship, or some
aspect or incident of such relationship, Put a little differently, the money claims of
workers which now fall within the original and exclusive jurisdiction of Labor Arbiters
are those money claims which have some reasonable causal connection with the
employer-employee relationship.
Same; Same; Same; Same; Reasonable causal connection of money claims with the
employer-employee relationship; Case at bar.—Applying the foregoing reading to the
present case, we note that petitioner’s Innovation Program is an employee incentive
scheme offered and open only to employees of petitioner Corporation, more
specifically to employees below the rank of manager. Without the existing
employeremployee relationship between the parties here, there would have been no
occasion to consider the petitioner’s Innovation Program or the submission by Mr.
Vega of his proposal concerning beer grande; without that relationship, private
respondent Vega’s suit against petitioner Corporation would never have arisen. The
money claim of private respondent Vega in this case, therefore, arose out of or in
connection with his employment relationship with petitioner.
Same; Same; Same; Same; Jurisdiction; Where the claim to the principal relief sought
is to be resolved not by reference to the Labor Code or other labor statute or a CBA
but by the general civil law, the jurisdiction over the dispute belongs to the regular
courts of justice, and not to the NLRC and the Labor Arbiters.—It seems worth noting
that Medina v. Castro-Bartolome, referred to in the above excerpt, involved a claim
for damages by two (2) employees against the employer company and the General
Manager thereof, arising from the use of slanderous language on the occasion when
the General Manager fired the two (2) employees (the Plant General Manager and
the Plant Comptroller). The Court treated the claim for damages as “a simple action
for damages for tortious acts” allegedly committed by private respondents, clearly if
implied suggesting that the claim for damages did not necessarily arise out of or in
connection with the employer-employee relationship. Singapore Airlines Limited v.
Paño, also cited in Molave, involved a claim for liquidated damages not by a worker
but by the employer company, unlike Medina. The important principle that runs
through these three (3) cases is that where the claim to the principal relief sought is
to be resolved not by reference to the Labor Code or other labor relations statute or
a collective bargaining agreement but by the general civil law, the jurisdiction over
the dispute belongs to the regular courts of justice and not to the Labor Arbiter and
the NLRC. In such situations, resolution of the dispute requires expertise, not in labor
management relations nor in wage structures and other terms and conditions of
employment, but rather in the application of the general civil law. Clearly. such claims
fall outside the area of competence or expertise ordinarily ascribed to Labor Arbiters
and the NLRC and the rationale for granting jurisdiction over such claims to these
agencies disappears.
Same; Same; Same; Same; Same; Contracts; Recourse to our civil law on contracts, is
proper; Case at bar.—Applying the foregoing to the instant case, the Court notes that
the SMC Innovation Program was essentially an invitation from petitioner
Corporation to its employees to submit innovation proposals, and that petitioner
Corporation undertook to grant cash awards to employees who accept such
invitation and whose innovation suggestions, in the judgment of the Corporation’s
officials, satisfied the standards and requirements of the Innovation Program and
which, therefore, could be translated into some substantial benefit to the
Corporation. Such undertaking, though unilateral in origin, could nonetheless ripen
into an enforceable contractual (facio ut des) obligation on the part of petitioner
Corporation under certain circumstances. Thus, whether or not an enforceable
contract, albeit implied and innominate, had arisen between petitioner Corporation
and private respondent Vega in the circumstances of this case, and if so, whether or
not it had been breached, are pre-eminently legal questions, questions not to be
resolved by referring to labor legislation and having nothing to do with wages or
other terms and conditions of employment, but rather by having recourse to our law
on contracts.
 Singapore Airlines Limited vs. Paño
122 SCRA 671, No. L-47739 June 22, 1983

Labor Law; Jurisdiction; Claim for damages grounded on wanton failure and refusal
without just cause of employee to report for duty despite notice and malicious
violation of terms and conditions of training agreement, fall within the jurisdiction of
the civil courts.—Upon the facts and issues involved, jurisdiction over the present
controversy must be held to belong to the civil Courts. While seemingly petitioner’s
claim for damages arises from employer-employee relations, and the latest
amendment to Article 217 of the Labor Code under PD No. 1691 and BP Blg. 130
provides that all other claims arising from employer-employee relationship are
cognizable by Labor Arbiters, in essence, petitioner’s claim for damages is grounded
on the “wanton failure and refusal” without just cause of private respondent Cruz to
report for duty despite repeated notices served upon him of the disapproval of his
application for leave of absence without pay. This, coupled with the further averment
that Cruz “maliciously and with bad faith” violated the terms and conditions of the
conversion training course agreement to the damage of petitioner removes the
present controversy from the coverage of the Labor Code and brings it within the
purview of Civil Law.

Same; Same; Same; Where employee seeks protection under the civil laws and claims
no benefits under the Labor Code, but his claims for benefits arose from a breach of
an obligation, civil courts have jurisdiction over said claims.—Stated differently,
petitioner seeks protection under the civil laws and claims no benefits under the
Labor Code. The primary relief sought is for liquidated damages for breach of a
contractual obligation. The other items demanded are not labor benefits demanded
by workers generally taken cognizance of in labor disputes, such as payment of
wages, overtime compensation or separation pay. The items claimed are the natural
consequences flowing from breach of an obligation, intrinsically a civil dispute.

Same; Same; Labor Arbiters; Issue of whether the liability of surety is suretyship or
guaranty beyond competence of labor arbiters.—Additionally, there is a secondary
issue involved that is outside the pale of competence of Labor Arbiters. Is the liability
of Villanueva one of suretyship or one of guaranty? Unquestionably, this question is
beyond the field of specialization of Labor Arbiters.
 Portillo vs. Rudolf Lietz, Inc. behalf of any person, shall make any deduction from wages of his employees, except:
683 SCRA 568, G.R. No. 196539 October 10, 2012 (a) In cases where the worker is insured with his consent by the employer, and the
deduction is to recompense the employer for the amount paid by him as premium
Remedial Law; Civil Procedure; Appeals; Petition for Review on Certiorari; Section 1, on the insurance; (b) For union dues, in cases where the right of the worker or his
Rule 45 of the Rules of Court expressly provides that a party desiring to appeal by union to check-off has been recognized by the employer or authorized in writing by
certiorari from a judgment or final order or resolution of the Court of Appeals may file the individual worker concerned; and (c) In cases where the employer is authorized
a verified petition for review on certiorari.―Section 1, Rule 45 of the Rules of Court by law or regulations issued by the Secretary of Labor.
expressly provides that a party desiring to appeal by certiorari from a judgment or
final order or resolution of the Court of Appeals may file a verified petition for review
on certiorari. Considering that, in this case, appeal by certiorari was available to
Portillo, that available recourse foreclosed her right to resort to a special civil action
for certiorari, a limited form of review and a remedy of last recourse, which lies only
where there is no appeal or plain, speedy and adequate remedy in the ordinary
course of law.

Same; Same; Same; Same; Certiorari; A petition for review on certiorari under Rule 45
and a petition for certiorari under Rule 65 are mutually exclusive remedies.―A
petition for review on certiorari under Rule 45 and a petition for certiorari under Rule
65 are mutually exclusive remedies. Certiorari cannot co-exist with an appeal or any
other adequate remedy. If a petition for review is available, even prescribed, the
nature of the questions of law intended to be raised on appeal is of no consequence.
It may well be that those questions of law will treat exclusively of whether or not the
judgment or final order was rendered without or in excess of jurisdiction, or with
grave abuse of discretion. This is immaterial. The remedy is appeal, not certiorari as
a special civil action.

Labor Law; Not all disputes between an employer and his employee(s) fall within the
jurisdiction of the labor tribunals.―As early as Singapore Airlines Limited v. Paño, 122
SCRA 671 (1983), we established that not all disputes between an employer and his
employee(s) fall within the jurisdiction of the labor tribunals. We differentiated
between abandonment per se and the manner and consequent effects of such
abandonment and ruled that the first, is a labor case, while the second, is a civil law
case.

Same; Wage Deductions; Article 113 of the Labor Code prohibits wage deductions
except in three circumstances: (a) In cases where the worker is insured with his
consent by the employer, and the deduction is to recompense the employer for the
amount paid by him as premium on the insurance; (b) For union dues, in cases where
the right of the worker or his union to check-off has been recognized by the employer
or authorized in writing by the individual worker concerned; and (c) In cases where
the employer is authorized by law or regulations issued by the Secretary of
Labor.―Indeed, the application of compensation in this case is effectively barred by
Article 113 of the Labor Code which prohibits wage deductions except in three
circumstances: ART. 113. Wage Deduction.―No employer, in his own behalf or in
 Wesleyan University-Philippines vs. Maglaya, Sr.
815 SCRA 171, G.R. No. 212774 January 23, 2017
Labor Law; Appeals; Settled is the rule that while the decision of the National Labor
Relations Commission (NLRC) becomes final and executory after the lapse of ten (10)
calendar days from receipt thereof by the parties under Article 223 (now Article 229)
of the Labor Code, the adverse party is not precluded from assailing it via Petition for
Certiorari under Rule 65 before the Court of Appeals (CA) and then to this Court via a
Petition for Review under Rule 45.—Settled is the rule that while the decision of the
NLRC becomes final and executory after the lapse of ten calendar days from receipt
thereof by the parties under Article 223 (now Article 229) of the Labor Code, the
adverse party is not precluded from assailing it via Petition for Certiorari under Rule
65 before the CA and then to this Court via a Petition for Review under Rule 45.
Same; Same; Although the ten (10)-day period for finality of the decision of the
National Labor Relations Commission (NLRC) may already have lapsed as
contemplated in the Labor Code, the Supreme Court (SC) may still take cognizance of
the petition for certiorari on jurisdictional and due process considerations if filed
within the reglementary period under Rule 65.—We find that the application of the
doctrine of immutability of judgment in the case at bar is misplaced. To reiterate,
although the 10-day period for finality of the decision of the NLRC may already have
lapsed as contemplated in the Labor Code, this Court may still take cognizance of the
petition for certiorari on jurisdictional and due process considerations if filed within
the reglementary period under Rule 65. From the above mentioned, WUP was able
to discharge the necessary conditions in availing its remedy against the final and
executory decision of the NLRC. There is an underlying power of the courts to
scrutinize the acts of such agencies on questions of law and jurisdiction even though
no right of review is given by statute. Furthermore, the purpose of judicial review is
to keep the administrative agency within its jurisdiction and protect the substantial
rights of the parties.
Mercantile Law; Corporations; Corporate Officers; The president, vice president,
secretary and treasurer are commonly regarded as the principal or executive officers
of a corporation, and they are usually designated as the officers of the corporation.
However, other officers are sometimes created by the charter or bylaws of a
corporation, or the board of directors may be empowered under the bylaws of a
corporation to create additional offices as may be necessary.—The president, vice
president, secretary and treasurer are commonly regarded as the principal or
executive officers of a corporation, and they are usually designated as the officers of
the corporation. However, other officers are sometimes created by the charter or
bylaws of a corporation, or the board of directors may be empowered under the
bylaws of a corporation to create additional offices as may be necessary. This Court
expounded that an “office” is created by the charter of the corporation and the
officer is elected by the directors or stockholders, while an “employee” usually
occupies no office and generally is employed not by action of the directors or
stockholders but by the managing officer of the corporation who also determines the
compensation to be paid to such employee.
Same; Same; Same; One who is included in the bylaws of a corporation in its roster of
corporate officers is an officer of said corporation and not a mere employee.—It is
apparent from the bylaws of WUP that the president was one of the officers of the
corporation, and was an honorary member of the Board. He was appointed by the
Board and not by a managing officer of the corporation. We held that one who is
included in the bylaws of a corporation in its roster of corporate officers is an officer
of said corporation and not a mere employee. The alleged “appointment” of Maglaya
instead of “election” as provided by the bylaws neither convert the president of
university as a mere employee, nor amend its nature as a corporate officer. With the
office specifically mentioned in the bylaws, the NLRC erred in taking cognizance of
the case, and in concluding that Maglaya was a mere employee and subordinate
official because of the manner of his appointment, his duties and responsibilities,
salaries and allowances, and considering the Identification Card, the Administration
and Personnel Policy Manual which specified the retirement of the university
president, and the check disbursement as pieces of evidence supporting such finding.
Same; Same; Same; Intra-corporate Controversies; A corporate officer’s dismissal is
always a corporate act, or an intra-corporate controversy which arises between a
stockholder and a corporation, and the nature is not altered by the reason or wisdom
with which the Board of Directors may have in taking such action.—A corporate
officer’s dismissal is always a corporate act, or an intra­-corporate controversy which
arises between a stockholder and a corporation, and the nature is not altered by the
reason or wisdom with which the Board of Directors may have in taking such action.
The issue of the alleged termination involving a corporate officer, not a mere
employee, is not a simple labor problem but a matter that comes within the area of
corporate affairs and management and is a corporate controversy in contemplation
of the Corporation Code.
Remedial Law; Civil Procedure; Jurisdiction; The long-established rule is that the
jurisdiction over a subject matter is conferred by law.—The long-established rule is
that the jurisdiction over a subject matter is conferred by law. Perforce, Section 5(c)
of PD 902-A, as amended by Subsection 5.2, Section 5 of Republic Act No. 8799, which
provides that the regional trial courts exercise exclusive jurisdiction over all
controversies in the election or appointment of directors, trustees, officers or
managers of corporations, partnerships or associations, applies in the case at bar.
Mercantile Law; Corporations; Corporate Officers; Intra-corporate Controversies; The
determination of the rights of a corporate officer dismissed from his employment, as
well as the corresponding liability of a corporation, if any, is an intra-corporate
dispute subject to the jurisdiction of the regular courts.—To emphasize, the
determination of the rights of a corporate officer dismissed from his employment, as
well as the corresponding liability of a corporation, if any, is an intra-corporate
dispute subject to the jurisdiction of the regular courts.

Remedial Law; Civil Procedure; Judgments; Void Judgments; As held in Leonor v. Court
of Appeals, 256 SCRA 69 (1996), a void judgment for want of jurisdiction is no
judgment at all. It cannot be the source of any right nor the creator of any
obligation.—As held in Leonor v. Court of Appeals, 256 SCRA 69 (1996), a void
judgment for want of jurisdiction is no judgment at all. It cannot be the source of any
right nor the creator of any obligation. All acts performed pursuant to it and all claims
emanating from it have no legal effect. Hence, it can never become final and any writ
of execution based on it is void.
 Marc II Marketing, Inc. vs. Joson
662 SCRA 35, G.R. No. 171993 December 12, 2011
Labor Law; Illegal Dismissals; Corporation Law; Intra-corporate Controversies; The
dismissal of a corporate officer is always regarded as a corporate and/or an intra-
corporate controversy; Intra-corporate controversies also includes controversies in
the election or appointments of directors, trustees, officers or managers of such
corporations, partnerships or associations.—While Article 217(a)2 of the Labor Code,
as amended, provides that it is the Labor Arbiter who has the original and exclusive
jurisdiction over cases involving termination or dismissal of workers when the person
dismissed or terminated is a corporate officer, the case automatically falls within the
province of the RTC. The dismissal of a corporate officer is always regarded as a
corporate act and/or an intra-corporate controversy. Under Section 5 of Presidential
Decree No. 902-A, intra-corporate controversies are those controversies arising out
of intra-corporate or partnership relations, between and among stockholders,
members or associates; between any or all of them and the corporation, partnership
or association of which they are stockholders, members or associates, respectively;
and between such corporation, partnership or association and the State insofar as it
concerns their individual franchise or right to exist as such entity. It also includes
controversies in the election or appointments of directors, trustees, officers or
managers of such corporations, partnerships or associations.
Same; Same; Same; Same; Corporate Officers; Corporate officers are those officers of
a corporate who are given that character either by the Corporation Code or by the
corporation’s by-laws.—In Easycall Communications Phils., Inc. v. King, 478 SCRA 102
(2005), this Court held that in the context of Presidential Decree No. 902-A, corporate
officers are those officers of a corporation who are given that character either by the
Corporation Code or by the corporation’s by-laws. Section 25 of the Corporation Code
specifically enumerated who are these corporate officers, to wit: (1) president; (2)
secretary; (3) treasurer; and (4) such other officers as may be provided for in the by-
laws.
Same; Same; Same; Same; Same; The phrase “such other officers as may be provided
for in the by–laws” clarified and elaborated in Matling Industrial and Commercial
Corporation vs. Coros, 633 SCRA 12 (2010).—The aforesaid Section 25 of the
Corporation Code, particularly the phrase “such other officers as may be provided for
in the by-laws,” has been clarified and elaborated in this Court’s recent
pronouncement in Matling Industrial and Commercial Corporation v. Coros, 633 SCRA
12 (2010), where it held, thus: Conformably with Section 25, a position must be
expressly mentioned in the [b]y-[l]aws in order to be considered as a corporate office.
Thus, the creation of an office pursuant to or under a [b]y-[l]aw enabling provision is
not enough to make a position a corporate office. [In] Guerrea v. Lezama [citation
omitted] the first ruling on the matter, held that the only officers of a corporation
were those given that character either by the Corporation Code or by the [b]y-[l]aws;
the rest of the corporate officers could be considered only as employees or
subordinate officials. Thus, it was held in Easycall Communications Phils., Inc. v. King
[citation omitted]: An “office” is created by the charter of the corporation and the
officer is elected by the directors or stockholders. On the other hand, an employee
occupies no office and generally is employed not by the action of the directors or
stockholders but by the managing officer of the corporation who also determines the
compensation to be paid to such employee. x x x x This interpretation is the correct
application of Section 25 of the Corporation Code, which plainly states that the
corporate officers are the President, Secretary, Treasurer and such other officers as
may be provided for in the [b]y-[l]aws. Accordingly, the corporate officers in the
context of PD No. 902-A are exclusively those who are given that character either by
the Corporation Code or by the corporation’s [b]y[l]aws.
Same; Same; Same; Same; Same; Corporate officers are composed of (1) Chairman;
(2) President; (3) One or more Vice-President; (4) Treasurer; and (5) Secretary.—A
careful perusal of petitioner corporation’s by-laws, particularly paragraph 1, Section
1, Article IV, would explicitly reveal that its corporate officers are composed only of:
(1) Chairman; (2) President; (3) one or more Vice-President; (4) Treasurer; and (5)
Secretary. The position of General Manager was not among those enumerated.
Same; Same; Same; Same; Same; The board of directors has no power to create other
corporate offices without first amending the corporate by-laws so as to include
therein the newly created corporate office.—With the given circumstances and in
conformity with Matling Industrial and Commercial Corporation v. Coros, 633 SCRA
12 (2010), this Court rules that respondent was not a corporate officer of petitioner
corporation because his position as General Manager was not specifically mentioned
in the roster of corporate officers in its corporate by-laws. The enabling clause in
petitioner corporation’s by-laws empowering its Board of Directors to create
additional officers, i.e., General Manager, and the alleged subsequent passage of a
board resolution to that effect cannot make such position a corporate office. Matling
clearly enunciated that the board of directors has no power to create other corporate
offices without first amending the corporate by-laws so as to include therein the
newly created corporate office. Though the board of directors may create appointive
positions other than the positions of corporate officers, the persons occupying such
positions cannot be viewed as corporate officers under Section 25 of the Corporation
Code.
Same; Same; Same; Same; Same; The corporate officers enumerated in the by-laws
are the exclusive officers of the corporation while the rest could only be regarded as
mere employees or subordinate officials.—It is also of no moment that respondent,
being petitioner corporation’s General Manager, was given the functions of a
managing director by its Board of Directors. As held in Matling, the only officers of a
corporation are those given that character either by the Corporation Code or by the
corporate by-laws. It follows then that the corporate officers enumerated in the by-
laws are the exclusive officers of the corporation while the rest could only be
regarded as mere employees or subordinate officials. Respondent, in this case,
though occupying a high ranking and vital position in petitioner corporation but
which position was not specifically enumerated or mentioned in the latter’s by-laws,
can only be regarded as its employee or subordinate official.
Same; Same; Same; Same; Same; Not all conflicts between the stockholders and the
corporation are classified as intra-corporate; Other factors such as the status or
relationship of the parties and the nature of the question that is the subject of the
controversy must be considered in determining whether the dispute involves
corporate matters so as to regard them as intra-corporate controversies.—That
respondent was also a director and a stockholder of petitioner corporation will not
automatically make the case fall within the ambit of intra-corporate controversy and
be subjected to RTC’s jurisdiction. To reiterate, not all conflicts between the
stockholders and the corporation are classified as intra-corporate. Other factors such
as the status or relationship of the parties and the nature of the question that is the
subject of the controversy must be considered in determining whether the dispute
involves corporate matters so as to regard them as intra-corporate controversies. As
previously discussed, respondent was not a corporate officer of petitioner
corporation but a mere employee thereof so there was no intra-corporate
relationship between them. With regard to the subject of the controversy or issue
involved herein, i.e., respondent’s dismissal as petitioner corporation’s General
Manager, the same did not present or relate to an intra-corporate dispute.
Same; Same; Same; Same; Same; Respondent’s dismissal as petitioner corporation’s
General Manager did not amount to an intra-corporate controversy.—With all the
foregoing, this Court is fully convinced that, indeed, respondent, though occupying
the General Manager position, was not a corporate officer of petitioner corporation
rather he was merely its employee occupying a high-ranking position. Accordingly,
respondent’s dismissal as petitioner corporation’s General Manager did not amount
to an intra-corporate controversy. Jurisdiction therefor properly belongs with the
Labor Arbiter and not with the RTC.
Same; Same; In termination cases, the burden of proving just and valid cause for
dismissing an employee from his employment rests upon the employer.—In
termination cases, the burden of proving just and valid cause for dismissing an
employee from his employment rests upon the employer. The latter’s failure to
discharge that burden would necessarily result in a finding that the dismissal is
unjustified.
Same; Same; The closure or cessation of operations of establishment or undertaking
may either be due to serious business losses or financial reverses or otherwise.—
Under Article 283 of the Labor Code, as amended, one of the authorized causes in
terminating the employment of an employee is the closing or cessation of operation
of the establishment or undertaking. From the afore-quoted provision, the closure or
cessation of operations of establishment or undertaking may either be due to serious
business losses or financial reverses or otherwise. If the closure or cessation was due
to serious business losses or financial reverses, it is incumbent upon the employer to
sufficiently and convincingly prove the same. If it is otherwise, the employer can
lawfully close shop anytime as long as it was bona fide in character and not impelled
by a motive to defeat or circumvent the tenurial rights of employees and as long as
the terminated employees were paid in the amount corresponding to their length of
service.
Same; Same; Three Requisites for a Valid Cessation of Business Operations.—Under
Article 283 of the Labor Code, as amended, there are three requisites for a valid
cessation of business operations: (a) service of a written notice to the employees and
to the Department of Labor and Employment (DOLE) at least one month before the
intended date thereof; (b) the cessation of business must be bona fide in character;
and (c) payment to the employees of termination pay amounting to one month pay
or at least one-half month pay for every year of service, whichever is higher.
Same; Same; Due Process; The requirement of due process shall be deemed complied
with upon service of a written notice to the employee and the appropriate Regional
Office of the Department of Labor and Employment at least thirty days before
effectivity of the termination, specifying the ground or grounds for termination.—As
previously discussed, respondent’s dismissal was due to an authorized cause,
however, petitioner corporation failed to observe procedural due process in effecting
such dismissal. In Culili v. Eastern Telecommunications Philippines, Inc., 642 SCRA 338
(2011), this Court made the following pronouncements, thus: x x x x For termination
of employment as defined in Article 283 of the Labor Code, the requirement of due
process shall be deemed complied with upon service of a written notice to the
employee and the appropriate Regional Office of the Department of Labor and
Employment at least thirty days before effectivity of the termination, specifying the
ground or grounds for termination.
Same; Same; Same; The necessary consequence for such failure to comply with the
one-month prior written notice rule which constitutes a violation of an employee’s
right to statutory due process is the payment of indemnity in the form of nominal
damages.—The records of this case disclosed that there was absolutely no written
notice given by petitioner corporation to the respondent and to the DOLE prior to the
cessation of its business operations. This is evident from the fact that petitioner
corporation effected respondent’s dismissal on the same date that it decided to stop
and cease its business operations. The necessary consequence of such failure to
comply with the one-month prior written notice rule, which constitutes a violation of
an employee’s right to statutory due process, is the payment of indemnity in the form
of nominal damages.
Corporate Officers; Corporate Liability; Corporate officers are not personally liable for
their official acts unless it is shown that they have exceeded their authority.—As a
rule, corporation has a personality separate and distinct from its officers,
stockholders and members such that corporate officers are not personally liable for
their official acts unless it is shown that they have exceeded their authority. However,
this corporate veil can be pierced when the notion of the legal entity is used as a
means to perpetrate fraud, an illegal act, as a vehicle for the evasion of an existing
obligation, and to confuse legitimate issues. Under the Labor Code, for instance,
when a corporation violates a provision declared to be penal in nature, the penalty
shall be imposed upon the guilty officer or officers of the corporation.
 Salenga vs. Court of Appeals Special Economic Zone (CSEZ). Expressly, respondent was formed in accordance with
664 SCRA 635, G.R. No. 174941 February 1, 2012 Philippine corporation laws and existing rules and regulations promulgated by the
SEC pursuant to Section 16 of Republic Act (R.A.) 7227. CDC, a government-owned or
Corporation Law; Board of Directors; A corporation can only exercise its powers and -controlled corporation without an original charter, was incorporated under the
transact its business through its board of directors and through its officers and agents Corporation Code. Pursuant to Article IX-B, Sec. 2(1), the civil service embraces only
when authorized by a board resolution or its bylaws.—It is clear from the NLRC Rules those government-owned or -controlled corporations with original charter. As such,
of Procedure that appeals must be verified and certified against forum-shopping by respondent CDC and its employees are covered by the Labor Code and not by the
the parties-in-interest themselves. In the case at bar, the parties-in-interest are Civil Service Law, consistent with our ruling in NASECO v. NLRC, 168 SCRA 122 (1988),
petitioner Salenga, as the employee, and respondent Clark Development Corporation in which we established this distinction.
as the employer. A corporation can only exercise its powers and transact its business
through its board of directors and through its officers and agents when authorized by
a board resolution or its bylaws. The power of a corporation to sue and be sued is
exercised by the board of directors. The physical acts of the corporation, like the
signing of documents, can be performed only by natural persons duly authorized for
the purpose by corporate bylaws or by a specific act of the board. The purpose of
verification is to secure an assurance that the allegations in the pleading are true and
correct and have been filed in good faith. Thus, we agree with petitioner that, absent
the requisite board resolution, neither Timbol-Roman nor Atty. Mallari, who signed
the Memorandum of Appeal and Joint Affidavit of Declaration allegedly on behalf of
respondent corporation, may be considered as the “appellant” and “employer”
referred to by Rule VI, Sections 4 to 6 of the NLRC Rules of Procedure

Remedial Law; Civil Procedure; Appeals; The perfection of an appeal within the period
prescribed by law is jurisdictional, and the lapse of the appeal period deprives the
courts of jurisdiction to alter the final judgment.—Time and again, we have said that
the perfection of an appeal within the period prescribed by law is jurisdictional, and
the lapse of the appeal period deprives the courts of jurisdiction to alter the final
judgment. Thus, there is no other recourse but to respect the findings and ruling of
the labor arbiter. Clearly, therefore, the CA committed grave abuse of discretion in
entertaining the Petition filed before it after the NLRC had dismissed the case based
on lack of jurisdiction. The assailed CA Decision did not even resolve petitioner
Salenga’s consistent and persistent claim that the NLRC should not have taken
cognizance of the appeal in the first place, absent a board resolution. Thus, LA
Darlucio’s Decision with respect to the liability of the corporation still stands.

Corporation Law; Clark Development Corporation; Clark Development Corporation, a

government-owned or -controlled corporation without an original charter, was
incorporated under the Corporation Code. Pursuant to Article IX-B, Sec. 2(1), the civil
service embraces only those government-owned or-controlled corporations with
original charter. As such, respondent Clark Development Corporation and its
employees are covered by the Labor Code and not by the Civil Service Law.—
Respondent CDC owes its existence to Executive Order No. 80 issued by then
President Fidel V. Ramos. It was meant to be the implementing and operating arm of
the Bases Conversion and Development Authority (BCDA) tasked to manage the Clark
 Casino Labor Association vs. Court of Appeals
554 SCRA 323, G.R. No. 141020 June 12, 2008

Remedial Law; Jurisdiction; Civil Service Commission; National Labor Relations

Commission; It is the Civil Service Commission, and not the National Labor Relations
Commission (NLRC), that has jurisdiction over the employer-employee problems in
Philippine Amusement and Gaming Corporation (PAGCOR), Philippine Casino
Operators Corporation (PCOC) and Philippine Special Services Corporation (PSSC).—In
resolving the issue of whether or not the NLRC has jurisdiction over employer-
employee relations in PAGCOR, PCOC and PSSC, the Third Division made the
definitive ruling that “there appears to be no question from the petition and its
annexes that the respondent corporations were created by an original charter.” The
Court collectively referred to all respondent corporations, including PCOC and PSSC,
and held that in accordance with the Constitution and jurisprudence, corporations
with original charter “fall under the jurisdiction of the Civil Service Commission and
not the Labor Department.” The Court stated further that P.D. 1869 exempts casino
employees from the coverage of Labor Code provisions and although the employees
are empowered by the Constitution to form unions, these are “subject to the laws
passed to regulate unions in offices and corporations governed by the Civil Service
Law.” Thus, in dismissing the petition, the ruling of the Third Division was clear—it is
the Civil Service Commission, and not the NLRC, that has jurisdiction over the
employer-employee problems in PAGCOR, PCOC and PSSC.

Same; Judgments; It is well-settled that to determine the true intent and meaning of
a decision, no specific portion thereof should be resorted to, but the same must be
considered in its entirety.—Petitioner contends that the “private companies” referred
to therein pertain to respondents PCOC and PSSC, and consequently, this Court has
laid down the law of the case in G.R. No. 85922 and has directed that the cases against
PCOC and PSSC should be prosecuted before the Department of Labor and
Employment or NLRC. Petitioner’s contention is untenable. It is well-settled that to
determine the true intent and meaning of a decision, no specific portion thereof
should be resorted to, but the same must be considered in its entirety. Hence,
petitioner cannot merely view a portion of the 15 March 1989 Resolution in isolation
for the purpose of asserting its position. The 23 January 1989 Resolution already
ruled on the NLRC’s lack of jurisdiction over all the respondents in the case—PAGCOR,
PCOC and PSSC. The Third Division neither veered away nor reversed such ruling in
its 15 March 1989 Resolution to petitioner’s motion for reconsideration. A reading of
the two aforementioned resolutions clearly shows that the phrase “private
companies” could not have referred to PCOC and PSSC for that would substantially
alter the Court’s ruling that petitioner’s labor cases against the respondents are
cognizable by the Civil Service Commission, and not by the NLRC.
 Department of Foreign Affairs vs. NLRC
262 SCRA 39, G.R. No. 113191 September 18, 1996

Constitutional Law; Actions; Except in the specified cases of borrowing and guarantee
operations, as well as the purchase, sale and underwriting of securities, the ADB
enjoys immunity from legal process of every form.—The above stipulations of both
the Charter and Headquarters Agreement should be able, nay well enough, to
establish that, except in the specified cases of borrowing and guarantee operations,
as well as the purchase, sale and underwriting of securities, the ADB enjoys immunity
from legal process of every form. The Bank’s officers, on their part, enjoy immunity
in respect of all acts performed by them in their official capacity. The Charter and the
Headquarters Agreement granting these immunities and privileges are treaty
covenants and commitments voluntarily assumed by the Philippine government
which must be respected.
 Deltaventures Resources, Inc. vs. Cabato
327 SCRA 521, G.R. No. 118216 March 9, 2000
Actions; Jurisdiction; Pleadings and Practice; Basic as a hornbook principle,
jurisdiction over the subject matter of a case is conferred by law and determined by
the allegations in the complaint.—Basic as a hornbook principle, jurisdiction over the
subject matter of a case is conferred by law and determined by the allegations in the
complaint which comprise a concise statement of the ultimate facts constituting the
petitioner’s cause of action. Thus we have held that: “Jurisdiction over the subject-
matter is determined upon the allegations made in the complaint, irrespective of
whether the plaintiff is entitled or not entitled to recover upon the claim asserted
therein—a matter resolved only after and as a result of the trial.”
Labor Law; Courts; Jurisdiction; Where the subject matter of the third party claim is
but an incident of the labor case, it is a matter beyond the jurisdiction of regional trial
courts—such courts have no jurisdiction to act on labor cases or various incidents
arising therefrom, including the execution of decisions, awards or orders.—Ostensibly
the complaint before the trial court was for the recovery of possession and
injunction, but in essence it was an action challenging the legality or propriety of the
levy vis-à-vis the alias writ of execution, including the acts performed by the Labor
Arbiter and the Deputy Sheriff implementing the writ. The complaint was in effect a
motion to quash the writ of execution of a decision rendered on a case properly
within the jurisdiction of the Labor Arbiter, to wit: Illegal Dismissal and Unfair Labor
Practice. Considering the factual setting, it is then logical to conclude that the subject
matter of the third party claim is but an incident of the labor case, a matter beyond
the jurisdiction of regional trial courts. Precedent abound confirming the rule that
said courts have no jurisdiction to act on labor cases or various incidents arising
therefrom, including the execution of decisions, awards or orders. Jurisdiction to try
and adjudicate such cases pertains exclusively to the proper labor official concerned
under the Department of Labor and Employment. To hold otherwise is to sanction
split jurisdiction which is obnoxious to the orderly administration of justice.
Same; Same; Same; A party, by filing its third-party claim with a deputy sheriff
executing a writ of execution in a labor case, submits to the jurisdiction of the NLRC
acting through the Labor Arbiter.—Petitioner failed to realize that by filing its third-
party claim with the deputy sheriff, it submitted itself to the jurisdiction of the
Commission acting through the Labor Arbiter. It failed to perceive the fact that what
it is really controverting is the decision of the Labor Arbiter and not the act of the
deputy sheriff in executing said order issued as a consequence of said decision
rendered.
Same; Same; Same; Administrative Law; Whatever irregularities attend the issuance
and execution of the alias writ of execution should be referred to the same
administrative tribunal which rendered the decision.—Jurisdiction once acquired is
not lost upon the instance of the parties but continues until the case is terminated.
Whatever irregularities attended the issuance and execution of the alias writ of
execution should be referred to the same administrative tribunal which rendered the
decision. This is because any court which issued a writ of execution has the inherent
power, for the advancement of justice, to correct errors of its ministerial officers and
to control its own processes. The broad powers granted to the Labor Arbiter and to
the National Labor Relations Commission by Articles 217, 218 and 224 of the Labor
Code can only be interpreted as vesting in them jurisdiction over incidents arising
from, in connection with or relating to labor disputes, as the controversy under
consideration, to the exclusion of the regular courts.
Same; Same; Same; The Labor Code in Article 254 explicitly prohibits issuance of a
temporary or permanent injunction or restraining order in any case involving or
growing out of labor disputes by any court or other entity (except as otherwise
provided in Arts. 218 and 264).—It must be noted that the Labor Code in Article 254
explicitly prohibits issuance of a temporary or permanent injunction or restraining
order in any case involving or growing out of labor disputes by any court or other
entity (except as otherwise provided in Arts. 218 and 264). As correctly observed by
court a quo, the main issue and the subject of the amended complaint for injunction
are questions interwoven with the execution of the Commission’s decision. No doubt
the aforecited prohibition in Article 254 is applicable.
Same; Same; Same; Judgments; Writs of Execution; The power of the Labor Arbiter to
issue a writ of execution carries with it the power to inquire into the correctness of
the execution of his decision and to consider whatever supervening events might
transpire during such execution.—Petitioner should have filed its third-party claim
before the Labor Arbiter, from whom the writ of execution originated, before
instituting said civil case. The NLRC’s Manual on Execution of Judgment, issued
pursuant to Article 218 of the Labor Code, provides the mechanism for a third-party
claimant to assert his claim over a property levied upon by the sheriff pursuant to an
order or decision of the Commission or of the Labor Arbiter. The power of the Labor
Arbiter to issue a writ of execution carries with it the power to inquire into the
correctness of the execution of his decision and to consider whatever supervening
events might transpire during such execution.
Same; Same; Same; Same; A Regional Trial Court, being a co-equal body of the
National Labor Relations Commission, has no jurisdiction to issue any restraining
order or injunction to enjoin the execution of any decision of the latter.—In denying
petitioner’s petition for injunction, the court a quo is merely upholding the time-
honored principle that a Regional Trial Court, being a co-equal body of the National
Labor Relations Commission, has no jurisdiction to issue any restraining order or
injunction to enjoin the execution of any decision of the latter.
 Maneja vs. National Labor Relations Commission
290 SCRA 603, G.R. No. 124013 June 5, 1998
Labor Law; Jurisdiction; Labor Arbiters; Voluntary Arbitration; Grievance Procedure;
Collective Bargaining Agreements; Dismissal of Employees; Termination cases fall
under the original and exclusive jurisdiction of the Labor Arbiters, not voluntary
arbitrators.—As can be seen from the aforequoted Article, termination cases fall
under the original and exclusive jurisdiction of the Labor Arbiter. It should be noted,
however, that in the opening paragraph there appears the phrase: “Except as
otherwise provided under this Code x x x.” It is paragraph (c) of the same Article which
respondent Commission has erroneously interpreted as giving the voluntary
arbitrator jurisdiction over the illegal dismissal case. However, Article 217(c) should
be read in conjunction with Article 261 of the Labor Code which grants to voluntary
arbitrators original and exclusive jurisdiction to hear and decide all unresolved
grievances arising from the interpretation or implementation of the collective
bargaining agreement and those arising from the interpretation or enforcement of
company personnel policies. Note the phrase “unresolved grievances.” In the case at
bar, the termination of petitioner is not an unresolved grievance.
Same; Same; Same; Same; Same; Same; Same; Where the dispute is just in the
interpretation, implementation or enforcement stage, it may be referred to the
grievance machinery set up in the Collective Bargaining Agreement or by voluntary
arbitration, but where there is already actual termination, i.e., violation of rights, it is
already cognizable by the Labor Arbiter.—The stance of the Solicitor General in the
Sanyo case is totally the reverse of its posture in the case at bar. In Sanyo, the Solicitor
General was of the view that a distinction should be made between a case involving
“interpretation or implementation of Collective Bargaining Agreement” or
interpretation or “enforcement” of company personnel policies, on the one hand and
a case involving termination, on the other hand, It argued that the dismissal of the
private respondents does not involve an “interpretation or implementation” of a
Collective Bargaining Agreement or “interpretation or enforcement” of company
personnel policies but involves “termination.” The Solicitor General further said that
where the dispute is just in the interpretation, implementation or enforcement stage,
it may be referred to the grievance machinery set up in the Collective Bargaining
Agreement or by voluntary arbitration. Where there was already actual termination,
i.e., violation of rights, it is already cognizable by the Labor Arbiter. We fully agree
with the theory of the Solicitor General in the Sanyo case, which is radically opposite
to its position in this case.
Same; Same; Same; Same; Same; Same; Same; Only disputes involving the union and
the company shall be referred to the grievance machinery or voluntary arbitrators.—
Moreover, the dismissal of petitioner does not fall within the phrase “grievances
arising from the interpretation or implementation of collective bargaining agreement
and those arising from the interpretation or enforcement of company personnel
policies,” the jurisdiction of which pertains to the grievance machinery or thereafter,
to a voluntary arbitrator or panel of voluntary arbitrators. It is to be stressed that
under Article 260 of the Labor Code, which explains the function of the grievance
machinery and voluntary arbitrator, “(T)he parties to a Collective Bargaining
Agreement shall include therein provisions that will ensure the mutual observance of
its terms and conditions. They shall establish a machinery for the adjustment and
resolution of grievances arising from the interpretation or implementation of their
Collective Bargaining Agreement and those arising from the interpretation or
enforcement of company personnel policies.” Article 260 further provides that that
parties to a CBA shall name or designate their respective representative to the
grievance machinery and if the grievance is unsettled in that level, it shall
automatically be referred to the voluntary arbitrators designated in advance by the
parties to a CBA of the union and the company. It can thus be deduced that only
disputes involving the union and the company shall be referred to the grievance
machinery or voluntary arbitrators.
Same; Same; Same; Same; Same; Same; Words and Phrases; “Company Personnel
Policies,” Explained.—It should be explained that “company personnel policies” are
guiding principles stated in broad, long-range terms that express the philosophy or
beliefs of an organization’s top authority regarding personnel matters. They deal with
matters affecting efficiency and well-being of employees and include, among others,
the procedure in the administration of wages, benefits, promotions, transfer and
other personnel movements which are usually not spelled out in the collective
agreement. The usual source of grievances, however, are the rules and regulations
governing disciplinary actions.
Same; Same; Pleadings and Practice; Estoppel; The issue of jurisdiction is mooted by
a party’s active participation in the proceedings.—Clearly, estoppel lies. The issue of
jurisdiction was mooted by herein private respondent’s active participation in the
proceedings below. In Marquez vs. Secretary of Labor, the Court said: “x x x. The
active participation of the party against whom the action was brought, coupled with
his failure to object to the jurisdiction of the court or quasi-judicial body where the
action is pending, is tantamount to an invocation of that jurisdiction and a willingness
to abide by the resolution of the case and will bar said party from later on impugning
the court or body’s jurisdiction.”
Same; Dismissals; Requisites for Valid Dismissal.—The requisites of a valid dismissal
are (1) the dismissal must be for any of the causes expressed in Article 282 of the
Labor Code, and (2) the employee must be given an opportunity to be heard and to
defend himself. The substantive and procedural laws must be strictly complied with
before a worker can be dismissed from his employment because what is at stake is
not only the employee’s position but his livelihood.
Same; Same; Social Justice; Presumption of Good Faith; Our norms of social justice
demand that we credit employees with the presumption of good faith in the
performance of their duties.—Given the factual circumstances of the case, we cannot
deduce dishonesty from the act and omission of petitioner. Our norms of social
justice demand that we credit employees with the presumption of good faith in the
performance of their duties, especially petitioner who has served private respondent
since 1985 up to 1990 without any tinge of dishonesty and was even named “Model
Employee” for the month of April, 1989.
Same; Same; Dismissal must be based on a clear and not on an ambiguous or
ambivalent ground—any ambiguity or ambivalence on the ground relied upon by an
employer in terminating the services of an employee denies the latter his full right to
contest its legality.—Petitioner has been charged with a very serious offense—
dishonesty. This can irreparably wreck her life as an employee for no employer will
take to its bosom a dishonest employee. Dismissal is the supreme penalty that can
be meted to an employee and its imposition cannot be justified where the evidence
is ambivalent. It must, therefore, be based on a clear and not on an ambiguous or
ambivalent ground. Any ambiguity or ambivalence on the ground relied upon by an
employer in terminating the services of an employee denies the latter his full right to
contest its legality. Fairness cannot countenance such ambiguity or ambivalence.
Same; Same; Due Process; Well-settled is the dictum that the twin requirements of
notice and hearing constitute the essential elements of due process in the dismissal
of employees.—Well-settled is the dictum that the twin requirements of notice and
hearing constitute the essential elements of due process in the dismissal of
employees. It is a cardinal rule in our jurisdiction that the employer must furnish the
employee with two written notices before the termination of employment can be
effected: (a) the first apprises the employee of the particular acts or omissions for
which his dismissal is sought; and, (b) the second informs the employee of the
employer’s decision to dismiss him. The requirement of a hearing, on the other hand,
is complied with as long as there was an opportunity to be heard, and not necessarily
that an actual hearing was conducted.
Same; Same; Same; Consultations or conferences may not be a substitute for the
actual holding of a hearing.—An examination of the record reveals that no hearing
was ever conducted by private respondent before petitioner was dismissed. While it
may be true that petitioner submitted a written explanation, no hearing was actually
conducted before her employment was terminated. She was not accorded the
opportunity to fully defend herself. Consultations or conferences may not be a
substitute for the actual holding of a hearing. Every opportunity and assistance must
be accorded to the employee by the management to enable him to prepare
adequately for his defense, including legal representation. Considering that
petitioner denied having allegedly taken the second P500.00 deposit of the Japanese
guest which was eventually found; and, having made the alteration of the date on
the second RLDC merely to reflect the true date of the transaction, these
circumstances should have at least warranted a separate hearing to enable petitioner
to fully ventilate her side. Absent such hearing, petitioner’s right to due process was
clearly violated.
Same; Same; Same; A worker’s employment is property in the constitutional sense.—
It bears stressing that a worker’s employment is property in the constitutional sense.
He cannot be deprived of his work without due process of law. Substantive due
process mandates that an employee can only be dismissed based on just or
authorized causes. Procedural due process requires further that he can only be
dismissed after he has been given an opportunity to be heard. The import of due
process necessitates the compliance of these two aspects.
Same; Same; Damages; Where the termination of the services of an employee is
attended by fraud or bad faith on the part of the employer, as when the latter
knowingly made false allegations of a supposed valid cause when none existed, moral
and exemplary damages may be awarded in favor of the former.—The award of
moral and exemplary damages to petitioner is also warranted where there is lack of
due process in effecting the dismissal. Where the termination of the services of an
employee is attended by fraud or bad faith on the part of the employer, as when the
latter knowingly made false allegations of a supposed valid cause when none existed,
moral and exemplary damages may be awarded in favor of the former. The anti-social
and oppressive abuse of its right to investigate and dismiss its employees constitute
a violation of Article 1701 of the New Civil Code which prohibits acts of oppression
by either capital or labor against the other, and Article 21 on human relations. The
grant of moral damages to the employees by reason of such conduct on the part of
the company is sanctioned by Article 2219, No. 10 of the Civil Code, which allows
recovery of such damages in actions referred to in Article 21.
 Oriental Shipmanagement Co., Inc. vs. Bastol
622 SCRA 352, G.R. No. 186289 June 29, 2010
Labor Law; National Labor Relations Commission (NLRC); For the expeditious and
inexpensive filing of complaints by employees, the Regional Arbitration Branch (RAB)
of the National Labor Relations Commission (NLRC) provides pro-forma complaint
forms.—For the expeditious and inexpensive filing of complaints by employees, the
Regional Arbitration Branch (RAB) of the NLRC provides pro-forma complaint forms.
This is to facilitate the exercise and protection of employees’ rights by the convenient
assertion of their claims against employers untrammeled by procedural rules and
complexities. To comply with the certification against forum shopping requirement,
a simple question embodied in the Complaint form answerable by “yes” or “no”
suffices. Employee-complainants are not even required to have a counsel before they
can file their complaint. An officer of the RAB, duly authorized to administer oaths, is
readily available to facilitate the execution of the required subscription or jurat of the
complaint.
Same; Same; Sec. 4, Rule 7 of the Rules of Court does not apply to labor complaints
filed before the National Labor Relations Commission (NLRC) Regional Arbitration
Branch (RAB).—This can be seen in the case at bar. Bastol, assisted by counsel, filled
out the Complaint form, line No. 11 of which is a question on anti-forum shopping
which he answered by underlining the word “No.” It is thus clear that the strict
application of Sec. 4, Rule 7 of the Rules of Court does not apply to labor complaints
filed before the NLRC RAB.
Same; Same; Labor Arbiters; Labor Arbiter given full discretion whether to conduct a
hearing or not and to decide the case before him through position papers.—The
foregoing provisos manifestly show the non-litigious and the summary nature of the
proceedings before the Labor Arbiter, who is given full discretion whether to conduct
a hearing or not and to decide the case before him through position papers. In Iriga
Telephone Co, Inc. v. National Labor Relations Commission, 286 SCRA 600 (1998), the
Court discussed the reason why it is discretionary on the part of the Labor Arbiter,
who, motu proprio, determines whether to hold a hearing or not. Consequently, a
hearing cannot be demanded by either party as a matter of right. The parties are
required to file their corresponding position papers and all the documentary
evidence and affidavits to prove their cause of action and defenses. The rationale
behind this is to avoid delay and curtail the pernicious practice of withholding of
evidence.
Same; Same; Same; Proceedings before the Labor Arbiter are non-litigious in nature
and the technicalities of law and procedure and the rules obtaining in the courts of
law are not applicable.—In sum, it can be properly said that the proceedings before
the Labor Arbiter are non-litigious in nature and the technicalities of law and
procedure, and the rules obtaining in the courts of law are not applicable. Thus, the
rules allow the admission of affidavits by the Labor Arbiter as evidence despite the
fact that the affiants were not presented for cross-examination by the counsel for the
adverse party. To require otherwise would be to negate the rationale and purpose of
the summary nature of the administrative proceedings and to make mandatory the
application of the technical rules of evidence. What the other party should do is to
present counter-affidavits instead of merely objecting on the ground that the
affidavits are hearsay.
Same; Same; Same; Procedural Rules and Technicalities; Technical Rules of procedure
are not binding in labor cases.—The nature of the proceedings before the Labor
Arbiter is not only non-litigious and summary, but the Labor Arbiter is also given great
leeway to resolve the case; thus, he may “avail himself of all reasonable means to
ascertain the facts of the controversy.” The belated submission of additional
documentary evidence by Bastol after the case was already submitted for decision
did not make the proceedings before the Labor Arbiter improper. The basic reason is
that technical rules of procedure are not binding in labor cases.
Same; Disability; In disability compensation, it is not the injury which is compensated
but rather the incapacity to work resulting in the impairment of one’s earning
capacity.—It has been held that disability is intimately related to one’s earning
capacity. It should be understood less on its medical significance but more on the loss
of earning capacity. Total disability does not mean absolute helplessness. In disability
compensation, it is not the injury which is compensated, but rather the incapacity to
work resulting in the impairment of one’s earning capacity. Thus, permanent
disability is the inability of a worker to perform his job for more than 120 days,
regardless of whether or not he loses the use of any part of his body.
Same; Same; Permanent Disability; Definition of Permanent Disability.—In Wallem
Maritime Services, Inc. v. National Labor Relations Commission, 566 SCRA 338 (2008),
we cited the consistent application of the definition of permanent disability under
Sec. 2 (b), Rule VII of the Implementing Rules of Book V of the Labor Code as amended
by PD 626, which provides: (b) A disability is total and permanent if as a result of the
injury or sickness the employee is unable to perform any gainful occupation for a
continuous period exceeding 120 days, except as otherwise provided for in Rule X of
these Rules.
Same; Same; Employees’ Compensation; Myocardial Infarction; Myocardial infarction
as a disease or cause of death is compensable.—OSCI also erroneously contends that
the illness of Bastol is not compensable under the SEC. It has already been settled in
Heirs of the Late R/O Reynaldo Aniban v. National Labor Relations Commission, 282
SCRA 377 (1997), that myocardial infarction as a disease or cause of death is
compensable, such being occupational. As the CA aptly noted, Bastol’s work as bosun
caused, if not greatly contributed, to his heart ailment
Remedial Law; Actions; Judgement; Res Judicata; Concepts of the doctrine of res
judicata are applicable to second actions involving substantially the same parties, the
same subject matter and cause or causes of actions.—Suffice it to say that the July
30, 1999 NLRC Decision cannot and does not constitute res judicata to the instant
case. In Estate of the Late Encarnacion Vda. de Panlilio v. Dizon, 536 SCRA 565 (2007),
extensively quoting from the earlier case of Vda. de Cruzo v. Carriaga, Jr., 174 SCRA
330 (1989), we explained the nature of res judicata, as now embodied in Sec. 47, Rule
39 of the Rules of Court, in its two concepts of “bar by former judgment” and
“conclusiveness of judgment.” These concepts of the doctrine of res judicata are
applicable to second actions involving substantially the same parties, the same
subject matter, and cause or causes of action. In the instant case, there is no second
action to speak of, involving as it is the very same action albeit the NLRC remanded it
to the Labor Arbiter for further proceedings.
 Robosa vs. National Labor Relations Commission (First Division)
665 SCRA 434, G.R. No. 176085 February 8, 2012
Labor Law; Contempt; Under Article 218 of the Labor Code, the NLRC (and the labor
arbiters) may hold any offending party in contempt, directly or indirectly, and impose
appropriate penalties in accordance with law.—Under Article 218 of the Labor Code,
the NLRC (and the labor arbiters) may hold any offending party in contempt, directly
or indirectly, and impose appropriate penalties in accordance with law. The penalty
for direct contempt consists of either imprisonment or fine, the degree or amount
depends on whether the contempt is against the Commission or the labor arbiter.
The Labor Code, however, requires the labor arbiter or the Commission to deal with
indirect contempt in the manner prescribed under Rule 71 of the Rules of Court. Rule
71 of the Rules of Court does not require the labor arbiter or the NLRC to initiate
indirect contempt proceedings before the trial court. This mode is to be observed
only when there is no law granting them contempt powers. As is clear under Article
218(d) of the Labor Code, the labor arbiter or the Commission is empowered or has
jurisdiction to hold the offending party or parties in direct or indirect contempt. The
petitioners, therefore, have not improperly brought the indirect contempt charges
against the respondents before the NLRC.
Same; Labor Arbiters; Jurisdiction; Whether payroll reinstatement of some of the
petitioners is proper; whether the resignation of some of them was compelled by dire
economic necessity; whether the petitioners are entitled to their money claims; and
whether quitclaims are contrary to law or public policy are issues that should be heard
by the labor arbiter in the first instance.—It rightly avoided delving into issues which
would clearly be in excess of its jurisdiction for they are issues involving the merits of
the case which are by law within the original and exclusive jurisdiction of the labor
arbiter. To be sure, whether payroll reinstatement of some of the petitioners is
proper; whether the resignation of some of them was compelled by dire economic
necessity; whether the petitioners are entitled to their money claims; and whether
quitclaims are contrary to law or public policy are issues that should be heard by the
labor arbiter in the first instance. The NLRC can inquire into them only on appeal after
the merits of the case shall have been adjudicated by the labor arbiter. The NLRC
correctly dismissed the contempt charges against the respondents. The CA likewise
committed no grave abuse of discretion in not disturbing the NLRC resolution.

Same; Same; Section 11, Rule 71 of the Rules of Court states that the judgment or
final order of a court in a case of indirect contempt may be appealed to the proper
court as in a criminal case.—Section 11, Rule 71 of the Rules of Court states that the
judgment or final order of a court in a case of indirect contempt may be appealed to
the proper court as in a criminal case. This is not the point at issue, however, in this
petition. It is rather the question of whether the dismissal of a contempt charge, as
in the present case, is appealable. The CA held that the NLRC’s dismissal of the
contempt charges against the respondents amounts to an acquittal in a criminal case
and is not subject to appeal. The CA ruling is grounded on prevailing jurisprudence.
In Yasay, Jr. v. Recto, 313 SCRA 739 (1999), the Court declared: A distinction is made
between a civil and [a] criminal contempt. Civil contempt is the failure to do
something ordered by a court to be done for the benefit of a party. A criminal
contempt is any conduct directed against the authority or dignity of the court.

Same; Grave Abuse of Discretion; An act of a court or tribunal may only be considered
as committed in grave abuse of discretion when it was performed in a capricious or
whimsical exercise of judgment which is equivalent to lack of jurisdiction.—An act of
a court or tribunal may only be considered as committed in grave abuse of discretion
when it was performed in a capricious or whimsical exercise of judgment which is
equivalent to lack of jurisdiction. The abuse of discretion must be so patent and gross
as to amount to an evasion of a positive duty enjoined by law, or to act at all in
contemplation of law, as where the power is exercised in an arbitrary and despotic
manner by reason of passion or personal hostility.
 Unicol Management Services, Inc. vs. Malipot the NLRC via petition for certiorari under Rule 65 of the Rules of Court before the CA
747 SCRA 191, G.R. No. 206562 January 21, 2015 and then to this Court via a petition for review under Rule 45.

Remedial Law; Civil Procedure; Appeals; Petition for Review on Certiorari; The Labor Law; Seafarers; Death Benefits; Death by Suicide; The employer may be exempt
jurisdiction of the Supreme Court (SC) in cases brought before it under Rule 45 of the from liability if it can successfully prove that the seaman’s death was caused by an
Rules of Court is limited only to reviewing errors of law; Exceptions.—At the outset, it injury directly attributable to his deliberate or willful act.—Clearly, the employer is
must be emphasized that the jurisdiction of the Court in cases brought before it under liable to pay the heirs of the deceased seafarer for death benefits once it is
Rule 45 of the Rules of Court is limited only to reviewing errors of law. However, this established that he died during the effectivity of his employment contract. However,
rule is subject to certain exceptions, namely: (1) When the findings are grounded the employer may be exempt from liability if it can successfully prove that the
entirely on speculations, surmises or conjectures; (2) When the inference made is seaman’s death was caused by an injury directly attributable to his deliberate or
manifestly mistaken, absurd or impossible; (3) When there is grave abuse of willful act. Thus, since petitioners were able to substantially prove that seaman
discretion; (4) When the judgment is based on misapprehension of facts; (5) When Glicerio’s death is directly attributable to his deliberate act of hanging himself, his
the findings of fact are conflicting; (6) When in making its findings the Court of death, therefore, is not compensable and his heirs not entitled to any compensation
Appeals went beyond the issues of the case, or its findings are contrary to the or benefits.
admissions of both the appellant and the appellee; (7) When the findings are contrary
to that of the trial court; (8) When the findings are conclusions without citation of
specific evidence on which they are based; (9) When the facts set forth in the petition
as well as in the petitioner’s main and reply briefs are not disputed by the
respondent; (10) When the findings of fact are premised on the supposed absence of
evidence and contradicted by the evidence on record; or (11) When the Court of
Appeals manifestly overlooked certain relevant facts not disputed by the parties,
which, if properly considered, would justify a different conclusion. Normally, the
Supreme Court is not a trier of facts. However, since the findings of the CA and the
NLRC were conflicting, it is incumbent upon this Court to wade through the records
to find out if there was enough basis for the CA’s reversal of the NLRC decision.

Administrative Agencies; National Labor Relations Commission; Jurisdiction; Among

the powers of the Commission as provided in Section 218 of the Labor Code is that the
Commission may issue subpoenas requiring the attendance and testimony of
witnesses or the production of such books, papers, contracts, records, statement of
accounts, agreements, and others.—Moreover, among the powers of the
Commission as provided in Section 218 of the Labor Code is that the Commission may
issue subpoenas requiring the attendance and testimony of witnesses or the
production of such books, papers, contracts, records, statement of accounts,
agreements, and others. In addition, the Commission may, among other things,
conduct investigation for the determination of a question, matter or controversy
within its jurisdiction, proceed to hear and determine the disputes in the absence of
any party thereto who has been summoned or served with notice to appear, conduct
its proceedings or any part thereof in public or in private, adjourn its hearings to any
time and place, refer technical matters or accounts to an expert and to accept his
report as evidence after hearing of the parties upon due notice. From the foregoing,
it can be inferred that the NLRC can receive evidence on cases appealed before the
Commission, otherwise, its factual conclusions would not have been given great
respect, much weight, and relevance when an adverse party assails the decision of
 Food Traders House, Inc. vs. NLRC loan to Espino and out of the personal funds of Alinas. Clearly, this personal loan is
300 SCRA 360, G.R. No. 120677 December 21, 1998 not within the ambit of the Labor Arbiter’s jurisdiction.

Labor Law; Illegal Dismissals; Reinstatement; Backwages; As the law now stands, an
illegally dismissed employee is entitled to his full back wages, without deduction of
earnings earned elsewhere, from the time his compensation was withheld until his
actual reinstatement.—As the law now stands, an illegally dismissed employee is
entitled to his full back wages, without deduction of earnings earned elsewhere, from
the time his compensation was withheld until his actual reinstatement. As such,
earnings earned elsewhere during the pendency of the case should not be deducted
from the computation of his back wages. The rationale is that—“the employee, while
litigating the legality (illegality) of his dismissal, must still earn a living to support
himself and family, while full back wages have to be paid by the employer as part of
the price or penalty he has to pay for illegally dismissing his employee. The clear
legislative intent of the amendment in Rep. Act No. 6715 is to give more benefits to
workers than was previously given them under the Mercury Drug rule or the
‘deduction of earnings elsewhere’ rule. Thus, a closer adherence to the legislative
policy behind Rep. Act No. 6715 points to ‘full back wages’ as meaning exactly that,
i.e., without deducting from back wages the earnings derived elsewhere by the
concerned employee during the period of his illegal dismissal. In other words, the
provision calling for ‘full back wages’ to illegally dismissed employees is clear, plain
and free from ambiguity and, therefore, must be applied without attempted or
strained interpretation. Index animi sermo est.
Same; Same; Same; Same; National Labor Relations Commission; If a claim does not
fall within the exclusive original jurisdiction of the labor arbiter, the NLRC cannot have
appellate jurisdiction thereon, much less receive additional evidence, and the NLRC
gravely abuses its discretion when it affirms the garnishment of an employee’s salary
and allows its set-off against the company president’s personal loan.—Under par. (b)
of Art. 217 of the Labor Code, the NLRC shall have exclusive appellate jurisdiction
over all cases decided by labor arbiters. This simply means that if a claim does not fall
within the exclusive original jurisdiction of the labor arbiter, the NLRC cannot have
appellate jurisdiction thereon, much less receive additional evidence. As a result, the
NLRC gravely abused its discretion when it affirmed the garnishment of Espino’s
salary and allowed its set-off against Espino’s personal loan on the ground that it does
not fall within the Labor Arbiter’s exclusive original jurisdiction.

Same; Same; Same; Same; In case reinstatement is adjudged, the award of back
wages and other benefits continues beyond the date of the labor arbiter’s decision
ordering reinstatement and extends up to the time said order of reinstatement is
actually carried out.—But the NLRC was correct in holding that Espino was entitled
to additional back wages. In the instant case, Espino was illegally dismissed on 31
January 1992 and was only actually reinstated on 4 July 1994. Conformably with Art.
279 of the Labor Code, which provides that an illegally dismissed employee is entitled
to full back wages from the time his compensation was withheld from him up to the
time of his actual reinstatement, Espino’s back wages should be computed from 31
January 1992 until 4 July 1994, plus the corresponding increases and other benefits,
including 13th month pay. Thus, in case reinstatement is adjudged, the award of back
wages and other benefits continues beyond the date of the labor arbiter’s decision
ordering reinstatement and extends up to the time said order of reinstatement is
actually carried out.

Same; Jurisdiction; Labor Arbiters; Loans; A personal loan from a company president
to an employee is not within the ambit of the Labor Arbiter’s jurisdiction.—In the
instant case, there is want of evidence that the P15,000 or P7,500.00 supposed
indebtedness of Espino to Alinas arose out of employer-employee relationship. On
the contrary, it was admitted by both parties that such indebtedness was a personal
 ABS-CBN Supervisors Employees Union Members vs. ABS-CBN Broadcasting
Corporation
304 SCRA 489, G.R. No. 106518 March 11, 1999
Labor Law; Certiorari; Motions for Reconsideration; Statutory Construction; Pleadings
and Practice; Section 8, Rule VIII, Book V of the Omnibus Rules Implementing the
Labor Code, providing that the decision of the Secretary of Labor shall be final and
executory, cannot be construed to mean that the decision of the Secretary cannot be
reconsidered since the same is reviewable by writ of certiorari under Rule 65.—
Section 8, Rule VIII, Book V of the Omnibus Rules Implementing the Labor Code,
provides: “The Secretary shall have fifteen (15) calendar days within which to decide
the appeal from receipt of the records of the case. The decision of the Secretary shall
be final and inappealable.” [Italics supplied]. (Comment, p. 101) The aforecited
provision cannot be construed to mean that the Decision of the public respondent
cannot be reconsidered since the same is reviewable by writ of certiorari under Rule
65 of the Rules of Court. As a rule, the law requires a motion for reconsideration to
enable the public respondent to correct his mistakes, if any.
Same; Same; Same; Same; Administrative Law; Exhaustion of Administrative
Remedies; A party aggrieved by a decision of the Secretary of Labor must be allowed
to move for a reconsideration of the same so that he can bring a special civil action
for certiorari before the Supreme Court.—So also, considering that a decision of the
Secretary of Labor is subject to judicial review only through a special civil action of
certiorari and, as a rule, cannot be resorted to without the aggrieved party having
exhausted administrative remedies through a motion for reconsideration, the
aggrieved party, must be allowed to move for a reconsideration of the same so that
he can bring a special civil action for certiorari before the Supreme Court.
Same; Estoppel; The active participation of a party against whom an action was
brought, coupled with his failure to object to the jurisdiction of the court or quasi-
judicial body where the action is pending, is tantamount to an invocation of that
jurisdiction and a willingness to abide by the resolution of the case and will bar said
party from later on impugning the court or body’s jurisdiction.—It appears that the
petitioners filed with the public respondent a Motion for Early Resolution dated June
24, 1992, averring that private respondents’ Motion for Reconsideration did not
contain substantial factual or legal grounds for the reversal of subject decision.
Consequently, petitioners are now estopped from raising the issue sought for
resolution. In Alfredo Marquez vs. Secretary of Labor, the Court said: “x x x The active
participation of the party against whom the action was brought, coupled with his
failure to object to the jurisdiction of the court or quasi-judicial body where the action
is pending, is tantamount to an invocation of that jurisdiction and a willingness to
abide by the resolution of the case and will bar said party from later on impugning
the court or body’s jurisdiction.”
Same; Check-Offs; Words and Phrases; A check-off is a process or device whereby the
employer, on agreement with the Union, recognized as the proper bargaining
representative, or on prior authorization from its employees, deducts union dues or
agency fees from the latter’s wages and remits them directly to the union; The system
of check-off is primarily for the benefit of the Union and only indirectly, for the
individual employees.—“A check-off is a process or device whereby the employer, on
agreement with the Union, recognized as the proper bargaining representative, or on
prior authorization from its employees, deducts union dues or agency fees from the
latter’s wages and remits them directly to the union.” Its desirability in a labor
organization is quite evident. It is assured thereby of continuous funding. As this
Court has acknowledged, the system of check-off is primarily for the benefit of the
Union and only indirectly, for the individual employees.
Same; Same; The legal basis of check-off is found in statutes or in contracts.—The
legal basis of check-off is found in statutes or in contracts. The statutory limitations
on check-offs are found in Article 241, Chapter II, Title IV, Book Five of the Labor Code.
Same; Same; Article 222 (b) of the Labor Code prohibits the payment of attorney’s
fees only when it is effected through forced contributions from the workers from their
own funds as distinguished from the union funds.—And this court elucidated the
object and import of the said provision of law in Bank of Philippine Islands Employees
Union—Association Labor Union (BPIEU-ALU) vs. National Labor Relations
Commission: “The Court reads the afore-cited provision (Article 222 [b] of the Labor
Code) as prohibiting the payment of attorney’s fees only when it is effected through
forced contributions from the workers from their own funds as distinguished from
the union funds. x x x”
Same; Same; Requisites before special assessment for Union’s incidental expenses,
attorney’s fees and representation expenses may be considered valid.—Noticeably,
Article 241 speaks of three (3) requisites that must be complied with in order that the
special assessment for Union’s incidental expenses, attorney’s fees and
representation expenses, as stipulated in Article XII of the CBA, be valid and upheld
namely: (1) authorization by a written resolution of the majority of all the members
at the general membership meeting duly called for the purpose; (2) secretary’s record
of the minutes of the meeting; and (3) individual written authorization for check-off
duly signed by the employee concerned.
Same; Same; The amount of check-off to be deducted is uncertain where although
not fixed, it is determinable.—Petitioner’s contention that the amount to be
deducted is uncertain is not persuasive because the check-off authorization clearly
stated that the sum to be deducted is equivalent to ten percent (10%) of all and
whatever benefits may accrue under the CBA. In other words, although the amount
is not fixed, it is determinable.
Same; Same; No deductions may be taken from the workers who did not sign any
check-off authorization.—Premises studiedly considered, we are of the irresistible
conclusion and, so find, that the ruling in BPIEU-ALU vs. NLRC that (1) the prohibition
against attorney’s fees in Article 222, paragraph (b) of the Labor Code applies only
when the payment of attorney’s fees is effected through forced contributions from
the workers; and (2) that no deductions must be taken from the workers who did not
sign the check-off authorization, applies to the case under consideration.
 Republic Cement Corporation vs. Guinmapang
596 SCRA 688, G.R. No. 168910 August 24, 2009

Labor Law; Appeals; Article 223 of the Labor Code, the governing law on the timeliness
of an appeal from the decisions, awards or orders of the Labor Arbiter, provides that
the aggrieved party has 10 calendar days from the receipt thereof to appeal to the
National Labor Relations Commission (NLRC).—Article 223 of the Labor Code, the
governing law on the timeliness of an appeal from the decisions, awards or orders of
the Labor Arbiter, provides that the aggrieved party has 10 calendar days from receipt
thereof to appeal to the NLRC. Section 1 of Rule VI of the 2005 Revised Rules of the
NLRC implements the said provision of the Labor Code. Section 1 provides: Section 1.
Periods of Appeal.—Decisions, awards or orders of the Labor Arbiter shall be final
and executory unless appealed to the Commission by any or both parties within ten
(10) calendar days from receipt thereof x x x.

Appeals; The general rule is that the perfection of an appeal in the manner and within
the period prescribed by law is not only mandatory, but jurisdictional, and failure to
conform to the rules will render the judgment sought to be reviewed final and
unappealable.—The general rule is that the perfection of an appeal in the manner
and within the period prescribed by law is, not only mandatory, but jurisdictional,
and failure to conform to the rules will render the judgment sought to be reviewed
final and unappealable. By way of exception, unintended lapses are disregarded so
as to give due course to appeals filed beyond the reglementary period on the basis
of strong and compelling reasons, such as serving the ends of justice and preventing
a grave miscarriage thereof. The purpose behind the limitation of the period of
appeal is to avoid an unreasonable delay in the administration of justice and to put
an end to controversies.

Same; We agree with the Court of Appeals that since no intent to delay the
administration of justice could be attributed to Guinmapang, a one day delay does
not justify the appeal’s denial.—We agree with the Court of Appeals that since no
intent to delay the administration of justice could be attributed to Guinmapang, a
one day delay does not justify the appeal’s denial. More importantly, the Court of
Appeals declared that Guinmapang’s appeal, on its face, appears to be impressed
with merit. The constitutional mandate to accord full protection to labor and to
safeguard the employee’s means of livelihood should be given proper attention and
sanction. A greater injustice may occur if said appeal is not given due course than if
the reglementary period to appeal were strictly followed. In this case, we are inclined
to excuse the one day delay in order to fully settle the merits of the case. This is in
line with our policy to encourage full adjudication of the merits of an appeal.
 Okada vs. Security Pacific Assurance Corporation
575 SCRA 124, G.R. No. 164344 December 23, 2008
Labor Law; Appeals; Appeal Bond; A cash or surety bond is a requirement sine qua
non for the perfection of an appeal from the Labor Arbiter’s monetary award.—The
indispensability of an appeal bond in the perfection of an appeal cannot be gainsaid.
A cash or surety bond is a requirement sine qua non for the perfection of an appeal
from the Labor Arbiter’s monetary award. In Viron Garments Manufacturing Co., Inc.
v. National Labor Relations Commission, 207 SCRA 339 (1992), the Court ruled: The
intention of the lawmakers to make the bond an indispensable requisite for the
perfection of an appeal by the employer is clearly limned in the provision that an
appeal by the employer may be perfected “only upon the posting of a cash or surety
bond.” The word ‘only’ makes it perfectly clear, that the lawmakers intended that the
posting of a cash or surety bond by the employer to be the exclusive means by which
an employer’s appeal may be perfected.
Same; Same; Same; Without any appeal being perfected, there is also no appeal bond
to speak of or to proceed against.—From the employer’s standpoint, the purpose of
the bond is to perfect one’s appeal and stay the execution of monetary awards. From
the standpoint of social justice, the rule in itself accords protection of the employee’s
monetary recovery during the period of appeal. Looking at it from either end, it is
clear that the bond exists only during the appeal of the judgment. Without any appeal
being perfected, there is also no appeal bond to speak of or to proceed against. The
records bear out that Meiyu contracted respondent SPAC for a surety bond after the
NLRC ruled with finality that its first surety bond from Wellington Insurance Co., Inc.
was spurious. Evidently, when the SPAC bond was issued, the period to appeal had
already lapsed. As a consequence, the Labor Arbiter decision became final and
executory.
Same; Same; Same; A belated filing of an appeal bond in labor cases will never ripen
into a perfected appeal, and money judgments could not be levied on the likewise
unperfected bond.—It may well be noted that respondent SPAC involved itself
unnecessarily in the controversy when it issued the appeal bond to Meiyu. To stress,
the period to appeal had lapsed and the Arbiter award had become final and
executory at the time of issuance of the bond. It is for this reason that there can be
no recourse on the said appeal bond but only against the employer Meiyu. A belated
filing of an appeal bond in labor cases will never ripen into a perfected appeal. When
the period to appeal lapses, the questioned decision becomes final and executory. In
such cases, this Court orders the petitioner to pay the monetary awards. Money
judgments were never levied on the likewise unperfected bond.
Same; Same; Appeal Memoranda; Remedial Law; The mere failure to furnish copy of
the appeal memorandum to adverse party is not a fatal defect—non-service of the
copy of the appeal or appeal memorandum to the adverse party is not a jurisdictional
defect, and does not justify dismissal of the appeal.—In Remerco Garments
Manufacturing v. Minister of Labor and Employment, 135 SCRA 167 (1985), this Court
held: x x x The mere failure to furnish copy of the appeal memorandum to adverse
party is not a fatal defect. We have consistently adhered to the principle clearly held
in Alonso v. Villamor, 161 SCRA 106 (1988), that “technicality when it deserts its
proper office as an aid to justice and become its great hindrance and chief enemy
deserves scant consideration from court.” x x x Finally, labor law determinations, to
quote from Bultmann, should be not only secundum retionem but also secundum
caritatem. More recently, we held that in appeals in labor cases, non-service of the
copy of the appeal or appeal memorandum to the adverse party is not a jurisdictional
defect, and does not justify dismissal of the appeal. x x x Taking into consideration
that justice should not be sacrificed for technicality, this Court reiterated the
aforementioned ruling in Modern Fishing Gear Labor Union v. Noriel, 161 SCRA 106
(1988) and Philippine-Singapore Ports Corporation v. National Labor Relations
Commission, 218 SCRA 77 (1993).
Same; Same; Same; Certiorari; The extraordinary writ of certiorari is always available
where there is no appeal or any other plain, speedy and adequate remedy in the
ordinary course of law.—Petitioner argues that the CA gravely erred in entertaining
the petition for certiorari. Citing Salas v. Adil, 90 SCRA 121 (1979), petitioner posits
that appeal was the proper and available remedy. Petitioner’s reliance on Salas is
misplaced. We note that Salas is not even a labor case. Further, the parties in Salas
were differently situated and all were original parties to the case. More than that,
there is nothing in Salas that supports petitioner’s claim that respondent SPAC should
have appealed the adverse Labor Arbiter Order to the NLRC and not to the CA via
certiorari. Respondent SPAC was not a party to the original action. It could not have
appealed the order of the Arbiter to the NLRC. Verily, respondent has no appeal nor
any plain, speedy, and adequate remedy in the ordinary course of law. In fine, a
petition for certiorari is the best available remedy to protect respondent’s rights. In
a long line of cases, the Court has consistently ruled that “the extraordinary writ of
certiorari is always available where there is no appeal or any other plain, speedy and
adequate remedy in the ordinary course of law.”
 Lepanto Consolidated Mining Corporation vs. Icao Therefore, once the appeal is finally decided and no award needs to be satisfied, the
714 SCRA 1, G.R. No. 196047 January 15, 2014 bond is automatically released. Since the money is now unencumbered, the employer
who posted it should now have unrestricted access to the cash which he may now
Remedial Law; Civil Procedure; Appeals; An appeal is not a matter of right, but is a use as he pleases — as appeal bond in another case, for instance. This is what
mere statutory privilege.—The Court finds it necessary to emphasize the well- petitioner simply did.
entrenched doctrine that an appeal is not a matter of right, but is a mere statutory
privilege. It may be availed of only in the manner provided by law and the rules. Thus,
a party who seeks to exercise the right to appeal must comply with the requirements
of the rules; otherwise, the privilege is lost.

Labor Law; Appeals; Appeal Bond; In appeals from any decision or order of the labor
arbiter, the posting of an appeal bond is required under Article 223 of the Labor
Code.—In appeals from any decision or order of the labor arbiter, the posting of an
appeal bond is required under Article 223 of the Labor Code, which reads: Article 223.
APPEAL.—Decisions, awards, or orders of the Labor Arbiter are final and executory
unless appealed to the Commission by any or both parties within ten (10) calendar
days from receipt of such decisions, awards, or orders. Such appeal may be
entertained only on any of the following grounds: x x x x In case of a judgment
involving a monetary award, an appeal by the employer may be perfected only upon
the posting of a cash or surety bond issued by a reputable bonding company duly
accredited by the Commission in the amount equivalent to the monetary award in
the judgment appealed from.

Remedial Law; Civil Procedure; Judgments; When the law does not clearly provide a
rule or norm for the tribunal to follow in deciding a question submitted, but leaves to
the tribunal the discretion to determine the case in one way or another, the judge
must decide the question in conformity with justice, reason and equity, in view of the
circumstances of the case.—We reiterate our pronouncement in Araneta v. Rodas,
81 Phil. 506 (1948), where the Court said that when the law does not clearly provide
a rule or norm for the tribunal to follow in deciding a question submitted, but leaves
to the tribunal the discretion to determine the case in one way or another, the judge
must decide the question in conformity with justice, reason and equity, in view of the
circumstances of the case. Applying this doctrine, we rule that petitioner
substantially complied with the mandatory requirement of posting an appeal bond
for the reasons explained below.

Labor Law; Appeals; Appeal Bond; Under the Rule VI, Section 6 of the 2005 NLRC
Rules, “[a] cash or surety bond shall be valid and effective from the date of deposit or
posting, until the case is finally decided, resolved or terminated, or the award
satisfied.”—Under the Rule VI, Section 6 of the 2005 NLRC Rules, “[a] cash or surety
bond shall be valid and effective from the date of deposit or posting, until the case is
finally decided, resolved or terminated, or the award satisfied.” Hence, it is clear that
a bond is encumbered and bound to a case only for as long as 1) the case has not
been finally decided, resolved or terminated; or 2) the award has not been satisfied.
 Philippine Touristers, Inc. vs. MAS Transit Workers Union-Anglo-KMU
734 SCRA 298, G.R. No. 201237 September 3, 2014
Labor Law; Appeals; Bond; For an appeal from the Labor Arbiter’s (LA’s) ruling to the
National Labor Relations Commission (NLRC) to be perfected, Article 223 (now Article
229) of the Labor Code requires the posting of a cash or surety bond in an amount
equivalent to the monetary award in the judgment appealed from.—For an appeal
from the LA’s ruling to the NLRC to be perfected, Article 223 (now Article 229) of the
Labor Code requires the posting of a cash or surety bond in an amount equivalent to
the monetary award in the judgment appealed from.
period to appeal. In McBurnie v. Ganzon, 707 SCRA 646 (2013), the Court ruled that,
“[f]or purposes of compliance with [the bond requirement under the 2011 NLRC
Rules of Procedure], a motion shall be accompanied by the posting of a provisional
cash or surety bond equivalent to ten percent (10%) of the monetary award subject
of the appeal, exclusive of damages, and attorney’s fees.” Seeing no cogent reason
to deviate from the same, the Court deems that the posting of the aforesaid partial
bond, being evidently more than ten percent (10%) of the full judgment award of
P12,833,000.00, already constituted substantial compliance with the governing rules
at the onset.

Same; Same; Same; While it has been settled that the posting of a cash or surety bond
is indispensable to the perfection of an appeal in cases involving monetary awards
from the decision of the Labor Arbiter (LA), the Rules of Procedure of the National
Labor Relations Commission (NLRC), particularly Section 6, Rule VI thereof,
nonetheless allows the reduction of the bond upon a showing of (a) the existence of
a meritorious ground for reduction, and (b) the posting of a bond in a reasonable
amount in relation to the monetary award.— While it has been settled that the
posting of a cash or surety bond is indispensable to the perfection of an appeal in
cases involving monetary awards from the decision of the LA, the Rules of Procedure
of the NLRC (the Rules), particularly Section 6, Rule VI thereof, nonetheless allows
the reduction of the bond upon a showing of (a) the existence of a meritorious ground
for reduction, and (b) the posting of a bond in a reasonable amount in relation to the
monetary award, viz.: SEC. 6. BOND.—In case the decision of the Labor Arbiter or the
Regional Director involves a monetary award, an appeal by the employer may be
perfected only upon the posting of a cash or surety bond. The appeal bond shall
either be in cash or surety in an amount equivalent to the monetary award, exclusive
of damages and attorney’s fees. x x x x No motion to reduce bond shall be entertained
except on meritorious grounds and upon the posting of a bond in a reasonable
amount in relation to the monetary award. The filing of the motion to reduce bond
without compliance with the requisites in the preceding paragraph shall not stop the
running of the period to perfect an appeal. (Emphasis and underscoring supplied) In
this regard, it bears stressing that the reduction of the bond provided thereunder is
not a matter of right on the part of the movant and its grant still lies within the sound
discretion of the NLRC upon a showing of meritorious grounds and the
reasonableness of the bond tendered under the circumstances.

Same; Same; Same; For purposes of compliance with [the bond requirement under
the 2011 National Labor Relations Commission (NLRC) Rules of Procedure], a motion
shall be accompanied by the posting of a provisional cash or surety bond equivalent
to ten percent (10%) of the monetary award subject of the appeal, exclusive of
damages, and attorney’s fees.—The absence of grave abuse of discretion in this case
is bolstered by the fact that petitioners’ motion to reduce bond was accompanied by
a P5,000,000.00 surety bond which was seasonably posted within the reglementary
 McBurnie vs. Ganzon
707 SCRA 646, G.R. Nos. 178034 & 178117 October 17, 2013
Remedial Law; Civil Procedure; Motion for Reconsideration; The Supreme Court
emphasizes that second and subsequent motions for reconsideration are, as a general
rule, prohibited. Section 2, Rule 52 of the Rules of Court provides that “[n]o second
motion for reconsideration of a judgment or final resolution by the same party shall
be entertained.”—At the outset, the Court emphasizes that second and subsequent
motions for reconsideration are, as a general rule, prohibited. Section 2, Rule 52 of
the Rules of Court provides that “[n]o second motion for reconsideration of a
judgment or final resolution by the same party shall be entertained.” The rule rests
on the basic tenet of immutability of judgments. “At some point, a decision becomes
final and executory and, consequently, all litigations must come to an end.” The
general rule, however, against second and subsequent motions for reconsideration
admits of settled exceptions. For one, the present Internal Rules of the Supreme
Court, particularly Section 3, Rule 15 thereof, provides: Sec. 3. Second motion for
reconsideration.—The Court shall not entertain a second motion for reconsideration,
and any exception to this rule can only be granted in the higher interest of justice by
the Court en banc upon a vote of at least two-thirds of its actual membership. There
is reconsideration “in the higher interest of justice” when the assailed decision is not
only legally erroneous, but is likewise patently unjust and potentially capable of
causing unwarranted and irremediable injury or damage to the parties. A second
motion for reconsideration can only be entertained before the ruling sought to be
reconsidered becomes final by operation of law or by the Court’s declaration.
Same; Same; Appeal Bonds; No motion to reduce bond shall be entertained except on
meritorious grounds and upon the posting of a bond in a reasonable amount in
relation to the monetary award.—We emphasize that the crucial issue in this case
concerns the sufficiency of the appeal bond that was posted by the respondents. The
present rule on the matter is Section 6, Rule VI of the 2011 NLRC Rules of Procedure,
which was substantially the same provision in effect at the time of the respondents’
appeal to the NLRC, and which reads: RULE VI APPEALS Sec. 6. BOND.—In case the
decision of the Labor Arbiter or the Regional Director involves a monetary award, an
appeal by the employer may be perfected only upon the posting of a cash or surety
bond. The appeal bond shall either be in cash or surety in an amount equivalent to
the monetary award, exclusive of damages and attorney’s fees. x x x x No motion to
reduce bond shall be entertained except on meritorious grounds and upon the
posting of a bond in a reasonable amount in relation to the monetary award. The
filing of the motion to reduce bond without compliance with the requisites in the
preceding paragraph shall not stop the running of the period to perfect an appeal.
Same; Same; Same; Labor Law; Time and again, the Supreme Court has cautioned the
National Labor Relations Commission (NLRC) to give Article 223 of the Labor Code,
particularly the provisions requiring bonds in appeals involving monetary awards, a
liberal interpretation in line with the desired objective of resolving controversies on
the merits.—Time and again, the Court has cautioned the NLRC to give Article 223 of
the Labor Code, particularly the provisions requiring bonds in appeals involving
monetary awards, a liberal interpretation in line with the desired objective of
resolving controversies on the merits. The NLRC’s failure to take action on the motion
to reduce the bond in the manner prescribed by law and jurisprudence then cannot
be countenanced. Although an appeal by parties from decisions that are adverse to
their interests is neither a natural right nor a part of due process, it is an essential
part of our judicial system. Courts should proceed with caution so as not to deprive
a party of the right to appeal, but rather, ensure that every party has the amplest
opportunity for the proper and just disposition of their cause, free from the
constraints of technicalities. Considering the mandate of labor tribunals, the principle
equally applies to them.
Labor Law; Appeals; Although the general rule provides that an appeal in labor cases
from a decision involving a monetary award may be perfected only upon the posting
of a cash or surety bond, the Court has relaxed this requirement under certain
exceptional circumstances in order to resolve controversies on their merits.—
Although the general rule provides that an appeal in labor cases from a decision
involving a monetary award may be perfected only upon the posting of a cash or
surety bond, the Court has relaxed this requirement under certain exceptional
circumstances in order to resolve controversies on their merits. These circumstances
include: (1) the fundamental consideration of substantial justice; (2) the prevention
of miscarriage of justice or of unjust enrichment; and (3) special circumstances of the
case combined with its legal merits, and the amount and the issue involved.
Guidelines that are applicable in the reduction of appeal bonds were also explained
in Nicol v. Footjoy Industrial Corporation, 528 SCRA 300 (2007). The bond
requirement in appeals involving monetary awards has been and may be relaxed in
meritorious cases, including instances in which (1) there was substantial compliance
with the Rules, (2) surrounding facts and circumstances constitute meritorious
grounds to reduce the bond, (3) a liberal interpretation of the requirement of an
appeal bond would serve the desired objective of resolving controversies on the
merits, or (4) the appellants, at the very least, exhibited their willingness and/or good
faith by posting a partial bond during the reglementary period.
Same; Remedial Law; Civil Procedure; Appeal Bonds; Time and again, the Supreme
Court has explained that the bond requirement imposed upon appellants in labor
cases is intended to ensure the satisfaction of awards that are made in favor of
appellees, in the event that their claims are eventually sustained by the courts.—As
the Court, nonetheless, remains firm on the importance of appeal bonds in appeals
from monetary awards of LAs, we stress that the NLRC, pursuant to Section 6, Rule
VI of the NLRC Rules of Procedure, shall only accept motions to reduce bond that are
coupled with the posting of a bond in a reasonable amount. Time and again, we have
explained that the bond requirement imposed upon appellants in labor cases is
intended to ensure the satisfaction of awards that are made in favor of appellees, in
the event that their claims are eventually sustained by the courts. On the part of the
appellants, its posting may also signify their good faith and willingness to recognize
the final outcome of their appeal.
Same; Same; Same; Same; In all cases, the reduction of the appeal bond shall be
justified by meritorious grounds and accompanied by the posting of the required
appeal bond in a reasonable amount.—In all cases, the reduction of the appeal bond
shall be justified by meritorious grounds and accompanied by the posting of the
required appeal bond in a reasonable amount. The requirement on the existence of
a “meritorious ground” delves on the worth of the parties’ arguments, taking into
account their respective rights and the circumstances that attend the case. The
condition was emphasized in University Plans Incorporated v. Solano, 652 SCRA 492
(2011); wherein the Court held that while the NLRC’s Revised Rules of Procedure
“allows the [NLRC] to reduce the amount of the bond, the exercise of the authority is
not a matter of right on the part of the movant, but lies within the sound discretion
of the NLRC upon a showing of meritorious grounds.” By jurisprudence, the merit
referred to may pertain to an appellant’s lack of financial capability to pay the full
amount of the bond, the merits of the main appeal such as when there is a valid claim
that there was no illegal dismissal to justify the award, the absence of an employer-
employee relationship, prescription of claims, and other similarly valid issues that are
raised in the appeal. For the purpose of determining a “meritorious ground”, the
NLRC is not precluded from receiving evidence, or from making a preliminary
determination of the merits of the appellant’s contentions.
have previously explained, however, the said conditions, particularly on the
successful completion of the project financing for the hotel project in Baguio City and
McBurnie’s acquisition of an Alien Employment Permit, failed to materialize. Such
defense of the respondents, which was duly considered by the NLRC in its Decision
dated November 17, 2009, was not sufficiently rebutted by McBurnie.
Same; Employer-Employee Relationship; Criteria in the Determination of an
Employer-Employee Relationship.—Given the parties’ conflicting claims on their true
intention in executing the agreement, it was necessary to resort to the established
criteria for the determination of an employer-employee relationship, namely: (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 rule of thumb
remains: the onus probandi falls on the claimant to establish or substantiate the claim
by the requisite quantum of evidence. Whoever claims entitlement to the benefits
provided by law should establish his or her right thereto. McBurnie failed in this
regard. As previously observed by the NLRC, McBurnie even failed to show through
any document such as payslips or vouchers that his salaries during the time that he
allegedly worked for the respondents were paid by the company. In the absence of
an employer-employee relationship between McBurnie and the respondents,
McBurnie could not successfully claim that he was dismissed, much less illegally
dismissed, by the latter. Even granting that there was such an employer-employee
relationship, the records are barren of any document showing that its termination
was by the respondents’ dismissal of McBurnie.

Same; Same; Same; Same; Although the National Labor Relations Commission (NLRC)
Rules of Procedure, particularly Section 6 of Rule VI thereof, provides that the bond to
be posted shall be “in a reasonable amount in relation to the monetary award,” the
merit of the motion shall always take precedence in the determination.—Although
the NLRC Rules of Procedure, particularly Section 6 of Rule VI thereof, provides that
the bond to be posted shall be “in a reasonable amount in relation to the monetary
award,” the merit of the motion shall always take precedence in the determination.
Settled is the rule that procedural rules were conceived, and should thus be applied
in a manner that would only aid the attainment of justice. If a stringent application
of the rules would hinder rather than serve the demands of substantial justice, the
former must yield to the latter.

Same; Termination of Employment; Illegal Dismissals; Before a case for illegal

dismissal can prosper, an employer-employee relationship must first be established.—
Before a case for illegal dismissal can prosper, an employer-employee relationship
must first be established. Although an employment agreement forms part of the case
records, respondent Ganzon signed it with the notation “per my note.” The
respondents have sufficiently explained that the note refers to the letter dated May
11, 1999 which embodied certain conditions for the employment’s effectivity. As we
 Garcia vs. KJ Commercial Container Lines, Inc. v. Bautista, 625 SCRA 75 (2010), the Court held: Jurisprudence
667 SCRA 396, G.R. No. 196830 February 29, 2012 tells us that in labor cases, an appeal from a decision involving a monetary award may
be perfected only upon the posting of a cash or surety bond. The Court, however, has
Labor Law; Appeals; Appeal Bond; The filing of a motion to reduce bond and relaxed this requirement under certain exceptional circumstances in order to resolve
compliance with the two conditions stop the running of the period to perfect an controversies on their merits. These circumstances include: (1) fundamental
appeal.—The Rules of Procedure of the NLRC allows the filing of a motion to reduce consideration of substantial justice; (2) prevention of miscarriage of justice or of
bond subject to two conditions: (1) there is meritorious ground, and (2) a bond in a unjust enrichment; and (3) special circumstances of the case combined with its legal
reasonable amount is posted. Section 6 of Article VI states: No motion to reduce merits, and the amount and the issue involved.
bond shall be entertained except on meritorious grounds and upon the posting of a
bond in a reasonable amount in relation to the monetary award. The mere filing of Same; Same; Same; While the bond requirement on appeals involving monetary
the motion to reduce bond without compliance with the requisites in the preceding awards has been relaxed in certain cases, this can only be done where there was
paragraph shall not stop the running of the period to perfect an appeal. The filing of substantial compliance of the Rules or where the appellants, at the very least,
a motion to reduce bond and compliance with the two conditions stop the running exhibited willingness to pay by posting a partial bond.—In Ong v. Court of Appeals,
of the period to perfect an appeal. In McBurnie v. Ganzon, 600 SCRA 658 (2009), the 438 SCRA 668 the Court held that the bond requirement on appeals may be relaxed
Court held: x x x [T]he bond may be reduced upon motion by the employer, this is when there is substantial compliance with the Rules of Procedure of the NLRC or
subject to the conditions that (1) the motion to reduce the bond shall be based on when the appellant shows willingness to post a partial bond. The Court held that,
meritorious grounds; and (2) a reasonable amount in relation to the monetary award “While the bond requirement on appeals involving monetary awards has been
is posted by the appellant, otherwise the filing of the motion to reduce bond shall relaxed in certain cases, this can only be done where there was substantial
not stop the running of the period to perfect an appeal. compliance of the Rules or where the appellants, at the very least, exhibited
willingness to pay by posting a partial bond.”
Same; Same; Same; National Labor Relations Commission (NLRC) Rules of Procedure;
Section 2, Article I of the Rules of Procedure of the NLRC states that, “These Rules shall
be liberally construed to carry out the objectives of the Constitution, the Labor Code
of the Philippines and other relevant legislations, and to assist the parties in obtaining
just, expeditious and inexpensive resolution and settlement of labor disputes.”—
Section 2, Article I of the Rules of Procedure of the NLRC states that, “These Rules
shall be liberally construed to carry out the objectives of the Constitution, the Labor
Code of the Philippines and other relevant legislations, and to assist the parties in
obtaining just, expeditious and inexpensive resolution and settlement of labor
disputes.” In order to give full effect to the provisions on motion to reduce bond, the
appellant must be allowed to wait for the ruling of the NLRC on the motion even
beyond the 10-day period to perfect an appeal. If the NLRC grants the motion and
rules that there is indeed meritorious ground and that the amount of the bond posted
is reasonable, then the appeal is perfected. If the NLRC denies the motion, the
appellant may still file a motion for reconsideration as provided under Section 15,
Rule VII of the Rules. If the NLRC grants the motion for reconsideration and rules that
there is indeed meritorious ground and that the amount of the bond posted is
reasonable, then the appeal is perfected. If the NLRC denies the motion, then the
decision of the labor arbiter becomes final and executory.

Same; Same; Same; The rule that the filing of a motion to reduce bond shall not stop
the running of the period to perfect an appeal is not absolute.—In any case, the rule
that the filing of a motion to reduce bond shall not stop the running of the period to
perfect an appeal is not absolute. The Court may relax the rule. In Intertranz
 Triad Security & Allied Services, Inc. vs. Ortega, Jr. by the labor arbiter is not the same as actual reinstatement of a dismissed or
481 SCRA 591, G.R. No. 160871 February 6, 2006 separated employee. Thus, until the employer continuously fails to actually
implement the reinstatement aspect of the decision of the labor arbiter, their
Remedial Law; Certiorari; Requisites for a Special Civil Action for a Petition for obligation to respondents, insofar as accrued backwages and other benefits are
Certiorari to Prosper.—It is a basic tenet of procedural rules that for a special civil concerned, continues to accumulate. It is only when the illegally dismissed employee
action for a petition for certiorari to prosper, the following requisites must concur: receives the separation pay that it could be claimed with certainty that the employer-
(1) the writ is directed against a tribunal, a board or an officer exercising judicial or employee relationship has formally ceased thereby precluding the possibility of
quasi-judicial functions; (2) such tribunal, board or officer has acted without or in reinstatement. In the meantime, the illegally dismissed employee’s entitlement to
excess of jurisdiction, or with grave abuse of discretion amounting to lack or excess backwages, 13th month pay, and other benefits subsists. Until the payment of
of jurisdiction; and (3) there is no appeal or any plain, speedy and adequate remedy separation pay is carried out, the employer should not be allowed to remain
in the ordinary course of law. unpunished for the delay, if not outright refusal, to immediately execute the
reinstatement aspect of the labor arbiter’s decision.
Labor Law; Illegal Dismissal; As the law now stands, an illegally dismissed employee
is entitled to two reliefs, namely: backwages and reinstatement; An illegally dismissed
employee is entitled to either reinstatement, if viable, or separation pay if
reinstatement is no longer viable and backwages.—As the law now stands, an illegally
dismissed employee is entitled to two reliefs, namely: backwages and reinstatement.
These are separate and distinct from each other. However, separation pay is granted
where reinstatement is no longer feasible because of strained relations between the
employee and the employer. In effect, an illegally dismissed employee is entitled to
either reinstatement, if viable, or separation pay if reinstatement is no longer viable
and backwages.

Same; Same; The award of one does not preclude that of the other as the Court had,
in proper cases, ordered the payment of both.—Backwages and separation pay are,
therefore, distinct reliefs granted to one who was illegally dismissed from
employment. The award of one does not preclude that of the other as this court had,
in proper cases, ordered the payment of both.

Same; Same; The law mandates the prompt reinstatement of the dismissed or
separated employee.—Under Article 223 of the Labor Code, “the decision of the
Labor Arbiter reinstating a dismissed or separated employee, insofar as the
reinstatement aspect is concerned, shall be immediately executory, even pending
appeal.” The same provision of the law gives the employer the option of either
admitting the employee back to work under the same terms and conditions prevailing
before his dismissal or separation from employment or the employer may choose to
merely reinstate the employee to the payroll. It bears emphasizing that the law
mandates the prompt reinstatement of the dismissed or separated employee. This,
the petitioners failed to heed.

Same; Same; Until the employer continuously fails to actually implement the
reinstatement aspect of the decision of the labor arbiter, their obligation to
respondents, insofar as accrued backwages and other benefits are concerned,
continues to accumulate.—It should be pointed out that an order of reinstatement
 Metroguards Security Agency Corporation (formerly known as Beeguards
Corporation) vs. Hilongo
752 SCRA 174, G.R. No. 215630 March 9, 2015

Labor Law; Termination of Employment; Illegal Dismissals; The recomputation of the

consequences of illegal dismissal upon execution of the decision does not constitute
an alteration or amendment of the final decision being implemented.—We thus
cannot agree with petitioners’ contention that a decision that has acquired finality
becomes immutable and unalterable. The recomputation of the consequences of
illegal dismissal upon execution of the decision does not constitute an alteration or
amendment of the final decision being implemented. The illegal dismissal ruling
stands; only the computation of monetary consequences of this dismissal is affected,
and this is not a violation of the principle of immutability of final judgments.

Interest Rates; In accordance with Bangko Sentral ng Pilipinas-Monetary Board’s

(BSP-MB’s) Circular No. 799, Series of 2013, the legal interest computed from July 1,
2013 until the monetary awards were fully satisfied will be six percent (6%) per
annum.—The CA incorrectly concluded that the April 30, 2010 Decision of the Labor
Arbiter became final on June 11, 2013, contrary to its own finding that it became final
and executory on April 26, 2013. This led to its erroneous computation of the
additional backwages and separation pay of Hilongo, as well as reckoning the date of
the 12% legal interest. Following the teaching of Nacar v. Gallery Frames, 703 SCRA
439 (2013), that the computation of the monetary consequences (backwages and
separation pay) of the illegal dismissal decision should be reckoned from its finality,
the additional backwages and separation pay of Hilongo should be computed from
May 1, 2010 to April 26, 2013. Further, the payment of legal interest of 12% per
annum should also be from April 26, 2013 up to June 30, 2013. Thereafter, in
accordance with Bangko Sentral ng Pilipinas Monetary Board’s Circular No. 799,
Series of 2013, the legal interest computed from July 1, 2013 until the monetary
awards were fully satisfied will be 6% per annum.
 C. Alcantara & Sons, Inc. vs. Court of Appeals
631 SCRA 486, G.R. No. 155109 September 29, 2010
Labor Law; Jurisdiction; The refusal of some union members to accept the summons
or to acknowledge receipt of the same cannot frustrate the National Labor Relations
Commission (NLRC) acquisition of jurisdiction over them; Besides, the affected Union
members voluntarily entered their appearance in the case when they sought
affirmative relief in the course of the proceedings like an award of damages in their
favor.—The NLRC acquires jurisdiction over parties in cases before it either by
summons served on them or by their voluntary appearance before its Labor Arbiter.
Here, while the Union insists that summons were not properly served on the
impleaded Union members with respect to the Company’s amended petition that
sought to declare the strike illegal, the records show that they were so served. The
Return of Service of Summons indi-cated that 74 out of the 81 impleaded Union
members were served with summons. But they refused either to accept the
summons or to acknowledge receipt of the same. Such refusal cannot of course
frustrate the NLRC’s acquisition of jurisdiction over them. Besides, the affected Union
members voluntarily entered their appearance in the case when they sought
affirmative relief in the course of the proceedings like an award of damages in their
favor.
Same; Strikes; No Strike, No Lockout Provisions; A strike may be regarded as invalid
although the labor union has complied with the strict requirements for staging one as
provided in Article 263 of the Labor Code when the same is held contrary to an existing
agreement, such as a no strike clause or conclusive arbitration clause.—A strike may
be regarded as invalid although the labor union has complied with the strict
requirements for staging one as provided in Article 263 of the Labor Code when the
same is held contrary to an existing agreement, such as a no strike clause or
conclusive arbitration clause. Here, the CBA between the parties contained a “no
strike, no lockout” provision that enjoined both the Union and the Company from
resorting to the use of economic weapons available to them under the law and to
instead take recourse to voluntary arbitration in settling their disputes. No law or
public policy prohibits the Union and the Company from mutually waiving the strike
and lockout maces available to them to give way to voluntary arbitration. Indeed, no
less than the 1987 Constitution recognizes in Section 3, Article XIII, preferential use
of voluntary means to settle disputes. Thus—“The State shall promote the principle
of shared responsibility between workers and employers and the preferential use of
voluntary modes in settling disputes, including conciliation, and shall enforce their
mutual compliance therewith to foster industrial peace.”
Same; Same; Where the Union’s strike has been declared illegal, the Union officers
can, in accordance with law be terminated from employment for their actions.—Since
the Union’s strike has been declared illegal, the Union officers can, in accordance
with law be terminated from employment for their actions. This includes the shop
stewards. They cannot be shielded from the coverage of Article 264 of the Labor Code
since the Union appointed them as such and placed them in positions of leadership
and power over the men in their respective work units. As regards the rank and file
Union members, Article 264 of the Labor Code provides that termination from
employment is not warranted by the mere fact that a union member has taken part
in an illegal strike. It must be shown that such a union member, clearly identified,
performed an illegal act or acts during the strike.
Same; Same; Illegal Dismissals; Reinstatement; Article 223 of the Labor Code, which
provides that the decision of the Labor Arbiter reinstating a dismissed employee shall
immediately be executory pending appeal, cannot but apply to all terminations
irrespective of the grounds on which they are based.—The CA denied reinstatement
for the reason that the reinstatement pending appeal provided under Article 223 of
the Labor Code contemplated illegal dismissal or termination cases and not cases
under Article 264. But this per-ceived distinction does not find support in the
provisions of the Labor Code. The grounds for termination under Article 264 are
based on prohibited acts that employees could commit during a strike. On the other
hand, the grounds for termination under Articles 282 to 284 are based on the
employee’s conduct in connection with his assigned work. Still, Article 217, which
defines the powers of Labor Arbiters, vests in the latter jurisdiction over all
termination cases, whatever be the grounds given for the termination of
employment. Consequently, Article 223, which provides that the decision of the
Labor Arbiter reinstating a dismissed employee shall immediately be executory
pending appeal, cannot but apply to all terminations irrespective of the grounds on
which they are based.
Same; Same; Same; Same; The Company’s failure to reinstate the employees pursuant
to the decision of the Labor Arbiter makes it liable for accrued backwages until the
eventual reversal of the order of reinstatement by the National Labor Relations
Commission (NLRC).—Although the Labor Arbiter failed to act on the terminated
Union members’ motion for reinstatement pending appeal, the Company had the
duty under Article 223 to immediately reinstate the affected employees even if it
intended to appeal from the decision ordaining such reinstatement. The Company’s
failure to do so makes it liable for accrued backwages until the eventual reversal of
the order of reinstatement by the NLRC on November 8, 1999, a period of four
months and nine days.
Same; Same; Financial Assistance; Considering that bitter labor disputes, especially
strikes, always generate a throng of odium and abhorrence that sometimes result in
unpleasant, although unwanted, consequences, the striking employees’ breach of
certain restrictions imposed on their concerted actions at their employer’s doorsteps
cannot be regarded as so inherently wicked that the employer can totally disregard
their long years of service prior to such breach—the award of financial assistance to
these Union members in the form of one-half month salary for every year of service
to the company up to the date of their termination is deemed equitable and
reasonable.—While it is true that generally the grant of separation pay is not
available to employees who are validly dismissed, there are, in furtherance of the
law’s policy of compassionate justice, certain circumstances that warrant the grant
of some relief in favor of the terminated Union members based on equity. Bitter labor
disputes, especially strikes, always generate a throng of odium and abhorrence that
sometimes result in unpleasant, although un-wanted, consequences. Considering
this, the striking employees’ breach of certain restrictions imposed on their
concerted actions at their employer’s doorsteps cannot be regarded as so inherently
wicked that the employer can totally disregard their long years of service prior to
such breach. The records also fail to disclose any past infractions committed by the
dismissed Union members. Taking these cir-cum-stances in consideration, the Court
regards the award of financial assistance to these Union members in the form of one-
half month salary for every year of service to the company up to the date of their
termination as equitable and reasonable.