FIRST DIVISION recruitment on two counts and was sentenced to 4 years to 6 years
imprisonment on each count.
[G.R. No. 121777. January 24, 2001.]
THE PEOPLE OF THE PHILIPPINES,  plaintiff-
appellee, vs. CAROL M.  DELA  PIEDRA,  accused-
appellant.
The Solicitor General  for plaintiff-appellee.
Daryll A. Amante  for accused-appellant.
SYNOPSIS
Erlie Ramos, an attorney of the POEA, received a call from an
unidentified woman inquiring about the legitimacy of the recruitment
conducted by Mrs. Carol Figueroa. Ramos conferred with the CIS to organize
the arrest of the alleged illegal recruiter. The group planned the entrapment
the next day with Eileen Fermindoza to pose as an applicant. The plan
materialized the next day, which caused the CIS team to bring Figueroa, a
certain Jasmine Alejandro, and three women applicants to the office for
investigation. In the course of the investigation, it turned out that Figueroa
had many aliases, among them Carol Llena and Carol de la Piedra. A check
by Ramos with the POEA revealed that she was not licensed nor authorized
to conduct recruitment. Figueroa was charged before the Regional Trial
Court of illegal recruitment in Large Scale. Denial comprised the accuseds'
defense. The trial court convicted the accused and sentenced her to life
imprisonment. Accused-appellant questioned her conviction for illegal
recruitment in large scale and assailed the constitutionality of the law.
The Supreme Court affirmed the constitutionality of the law and the
conviction of the accused, but reduced the penalty imposed upon her.
According to the Court, considering that the two elements of lack of license
or authority and the undertaking of the activity constituting recruitment and
placement are present, appellant, at the very least, was liable for simple
illegal recruitment. A conviction for large-scale illegal recruitment must be
based on a finding in each case of illegal recruitment of three or more
persons whether individually or as a group. In this case, only two persons
were proven to have been recruited by the appellant. Hence, the decision of
the Regional Trial Court was modified. Appellant was found guilty of illegal
SYLLABUS
1. POLITICAL LAW; CONSTITUTIONAL LAW; DUE PROCESS;
VOID FOR VAGUENESS. — Due process requires that the terms of a penal
statute must be sufficiently explicit to inform those who are subject to it what
conduct on their part will render them liable to its penalties. A criminal statute
that "fails to give a person of ordinary intelligence fair notice that his
contemplated conduct is forbidden by the statute," or is so indefinite that "it
encourages arbitrary and erratic arrests and convictions," is void for
vagueness. The constitutional vice in a vague or indefinite statute is the
injustice to the accused in placing him on trial for an offense, the nature of
which he is given no fair warning.
2. ID.; ID.; ID.; ID.; ARTICLE 13(b) OF LABOR CODE NOT VOID
FOR VAGUENESS. — While the Court, in People  vs. Panis, bemoaned the
lack of records that would help shed light on the meaning of the proviso in
Article 13(b) of the Labor Code."whenever two or more persons are in any
manner promised or offered any employment for a fee, the Court was able to
arrive at a reasonable interpretation of the proviso by applying principles in
criminal law and drawing from the language and intent of the law itself.
Section 13 (b), therefore, is not a "perfectly vague act" whose obscurity is
evident on its face. If at all, the proviso therein is merely couched in
imprecise language that was salvaged by proper construction. It is not void
for vagueness. CTSAaH
3. ID.; ID.; ID.; ID.; OVERBREADTH; CASE AT BAR. — A statute
may be said to be overbroad where it operates to inhibit the exercise of
individual freedoms affirmatively guaranteed by the Constitution, such as the
freedom of speech or religion. A generally worded statute, when construed to
punish conduct which cannot be constitutionally punished is
unconstitutionally vague to the extent that it fails to give adequate warning of
the boundary between the constitutionally permissible and the constitutionally
impermissible applications of the statute. . . . In the present case, however,
appellant did not even specify what constitutionally protected freedoms are
embraced by the definition of "recruitment and placement" that would render
the same constitutionally overbroad.
4. ID.; ID.; EQUAL PROTECTION CLAUSE; A STATUTE
NONDISCRIMINATORY ON ITS FACE BUT GROSSLY DISCRIMINATORY
IN ITS OPERATION; PROSECUTION FOR VIOLATION OF LAW MAY BE
CONSIDERED A DENIAL OF EQUAL PROTECTION ONLY WHEN THE
ELEMENT OF INTENTIONAL AND PURPOSEFUL DISCRIMINATION BE
PRESENT; ABSENCE THEREOF IN CASE AT BAR. — At the outset, it may
be stressed that courts are not confined to the language of the statute under
challenge in determining whether that statute has any discriminatory effect. A
statute nondiscriminatory on its face may be grossly discriminatory in its
operation. Though the law itself be fair on its face and impartial in
appearance, yet, if it is applied and administered by public authority with an
evil eye and unequal hand, so as practically to make unjust and illegal
discriminations between persons in similar circumstances, material to their
rights, the denial of equal justice is still within the prohibition of
the Constitution. The prosecution of one guilty person while others equally
guilty are not prosecuted, however, is not, by itself, a denial of the equal
protection of the laws. Where the official action purports to be in conformity to
the statutory classification, an erroneous or mistaken performance of the
statutory duty, although a violation of the statute, is not without more a denial
of the equal protection of the laws. The unlawful administration by officers of
a statute fair on its face, resulting in its unequal application to those who are
entitled to be treated alike, is not a denial of equal protection unless there is
shown to be present in it an element
of intentional or purposeful  discrimination. This may appear on the face of
the action taken with respect to a particular class or person, or it may only be
shown by extrinsic evidence showing a discriminatory design over another
not to be inferred from the action itself. But a discriminatory purpose is not
presumed, there must be a showing of "clear and intentional discrimination."
Appellant has failed to show that, in charging appellant in court, that there
was a "clear and intentional discrimination" on the part of the prosecuting
officials.
5. REMEDIAL LAW; EVIDENCE; DISPUTABLE PRESUMPTIONS;
REGULAR PERFORMANCE OF OFFICIAL DUTIES; CAN BE OVERCOME
ONLY BY PROOF TO THE CONTRARY; NOT PRESENT IN CASE AT BAR.
— The discretion of who to prosecute depends on the prosecution's sound
assessment whether the evidence before it can justify a reasonable belief
that a person has committed an offense. The presumption is that the
prosecuting officers regularly performed their duties, and this presumption
can be overcome only by proof to the contrary, not by mere speculation.
Indeed, appellant has not presented any evidence to overcome this
presumption. The mere allegation that appellant, a Cebuana, was charged
with the commission of a crime, while a Zamboangueña, the guilty party in
appellant's eyes, was not, is insufficient to support a conclusion that the
prosecution officers denied appellant equal protection of the laws.
6. LABOR AND SOCIAL LEGISLATION; LABOR CODE; ILLEGAL
RECRUITMENT; ELEMENTS. — Illegal recruitment is committed when two
elements concur. First, the offender has no valid license or authority required
by law to enable one to lawfully engage in recruitment and placement of
workers. Second, he or she undertakes either any activity within the meaning
of "recruitment and placement" defined under Article 13 (b), or any prohibited
practices enumerated under Article 34 of the Labor Code.In case of illegal
recruitment in large scale, a third element is added: that the accused
commits said acts against three or more persons, individually or as a group.
7. ID.; ID.; ID.; ID.; PRESENT IN CASE AT BAR. — In this case, the
first element is present. The certification of POEA Officer-in-Charge
Macarulay states that appellant is not licensed or authorized to engage in
recruitment and placement. The second element is also present. Appellant is
presumed engaged in recruitment and placement under Article 13 (b) of
the Labor Code.Both Nancy Araneta and Lourdes Modesto testified that
appellant promised them employment for a fee. Their testimonies corroborate
each other on material points: the briefing conducted by appellant, the time
and place thereof, the fees involved. Appellant has not shown that these
witnesses were incited by any motive to testify falsely against her. The
absence of evidence as to an improper motive actuating the principal
witnesses of the prosecution strongly tends to sustain that no improper
motive existed and that their testimony is worthy of full faith and credence.
8. ID.; ID.; ID.; ID.; DENIAL, NON-RECEIPT OF PAYMENTS AND
FRAME-UP; NOT AVAILING AS DEFENSES; RATIONALE. — Appellant's
denials cannot prevail over the positive declaration of the prosecution
witnesses. Affirmative testimony of persons who are eyewitnesses of the fact
asserted easily overrides negative testimony. That appellant did not receive
any payment for the promised or offered employment is of no moment. From
the language of the statute, the act of recruitment may be "for profit or not"; it
suffices that the accused "promises or offers for a fee employment" to
warrant conviction for illegal recruitment. . . The claim of "frameup," like alibi,
is a defense that has been invariably viewed by the Court with disfavor for it
can easily be concocted but difficult to prove. Apart from her self-serving
testimony, appellant has not offered any evidence that she was indeed
framed by Ramos. She has not even hinted at any motive for Ramos to
frame her. Law enforcers are presumed to have performed their duties
regularly in the absence of evidence to the contrary.
9. ID.; ID.; ID.; WHEN DONE IN LARGE SCALE; CONVICTION
THEREOF MUST BE BASED ON THE FINDINGS OF ILLEGAL
RECRUITMENT IN EACH CASE OF THE THREE OR MORE PERSONS
RECRUITED; ABSENCE THEREOF IN CASE AT BAR. — A conviction for
large scale illegal recruitment must be based on a finding in each case of
illegal recruitment of three or more persons whether individually or as a
group. In this case, only two persons, Araneta and Modesto, were proven to
have been recruited by appellant. The third person named in the complaint
as having been promised employment for a fee, Jennelyn Baez, was not
presented in court to testify. It is true that law does not require that at least
three victims testify at the trial; nevertheless, it is necessary that there is
sufficient evidence. proving that the offense was committed against three or
more persons. In this case, evidence that appellant likewise promised her
employment for a fee is sketchy. The only evidence that tends to prove this
fact is the testimony of Nancy Araneta, who said that she and her friends,
Baez and Sandra Aquino, came to the briefing and that they (she and her
"friends") filled up application forms. The affidavit Baez executed jointly with
Araneta cannot support Araneta's testimony. The affidavit was neither
identified, nor its contents affirmed, by Baez. Insofar as it purports to prove
that appellant recruited Baez, therefore, the affidavit is hearsay and
inadmissible. In any case, hearsay evidence, such as the said affidavit, has
little probative value. Neither can appellant be convicted for recruiting CIS
agent Eileen Fermindoza or even the other persons present in the briefing of
January 30, 1994. Appellant is accused of recruiting only the three persons
named in the information — Araneta, Modesto and Baez. The information
does not include Fermindoza or the other persons present in the briefing as
among those promised or offered employment for a fee. To convict appellant
for the recruitment and placement of persons other than those alleged to
have been offered or promised employment for a fee would violate her right
to be informed of the nature and cause of the accusation against her. Courts
may consider a piece of evidence only for the purpose for which it was
offered, and the purpose of the offer of their testimonies did not include the
proving of the purported recruitment of other supposed applicants by
appellant.
DECISION
KAPUNAN,  J p:
Accused-appellant Carol M. dela Piedra questions her conviction for
illegal recruitment in large scale and assails, as well, the constitutionality of
the law defining and penalizing said crime.
The Court affirms the constitutionality of the law and the conviction of
the accused, but reduces the penalty imposed upon her.
The accused was charged before the Regional Trial Court of
Zamboanga City in an information alleging:
That on or about January 30, 1994, in the City of
Zamboanga, Philippines, and within the jurisdiction of this
Honorable Court, the above-named accused, without
having previously obtained from the Philippine Overseas
Employment Administration, a license or authority to
engage in recruitment and overseas placement of workers,
did then and there, wilfully, unlawfully and feloniously, offer
and promise for a fee employment abroad particularly in
Singapore thus causing Maria Lourdes Modesto [y]
Gadrino, Nancy Araneta y Aliwanag and Jennelyn Baez y
Timbol, all qualified to apply, in fact said Maria Lourdes
Modesto had already advanced the amount of P2,000.00
to the accused for and in consideration of the promised
employment which did not materialized [sic] thus causing
damage and prejudice to the latter in the said sum;
furthermore, the acts complained of herein tantamount
[sic] to economic sabotage in that the same were
committed in large scale. 1
Arraigned on June 20, 1994, the accused pleaded not guilty 2 to
these charges.
At the trial, the prosecution presented five (5) witnesses, namely,
Erlie Ramos, SPO2 Erwin Manalopilar, Eileen Fermindoza, Nancy Araneta
and Lourdes Modesto. The succeeding narration is gathered from their
testimonies:
On January 30, 1994, at exactly 10:00 in the morning, Erlie Ramos,
Attorney II of the Philippine Overseas Employment Agency (POEA), received
a telephone call from an unidentified woman inquiring about the legitimacy of
the recruitment conducted by a certain Mrs. Carol Figueroa. Ramos, whose
duties include the surveillance of suspected illegal recruiters, immediately
contacted a friend, a certain Mayeth Bellotindos, so they could both go to No.
26-D, Tetuan Highway, Sta. Cruz, Zamboanga City, where the recruitment
was reportedly being undertaken. Upon arriving at the reported area at
around 4:00 p.m., Bellotindos entered the house and pretended to be an
applicant. Ramos remained outside and stood on the pavement, from where
he was able to see around six (6) persons in the house's sala. Ramos even
heard a woman, identified as Carol Fegueroa, talk about the possible
employment she has to provide in Singapore and the documents that the
applicants have to comply with. Fifteen (15) minutes later, Bellotindos came
out with a bio-data form in hand.
On February 1, 1994, Ramos conferred with a certain Capt.
Mendoza of the Criminal Investigation Service (CIS) to organize the arrest of
the alleged illegal recruiter. Also present were other members of the CIS,
including Col. Rodolfo Almonte, Regional Director of the PNP-CIS for Region
IX, Eileen Fermindoza, and a certain SPO3 Santos. The group planned to
entrap the illegal recruiter the next day by having Fermindoza pose as an
applicant. 3
On February 2, 1994, at around 8:00 p.m., Col. Almonte directed the
case to SPO2 Erwin Manalopilar, a member of the Philippine National Police
who was assigned as an investigator of the CIS, to conduct a surveillance of
the area to confirm the report of illegal recruitment. Accordingly, he, along
with Eileen Fermindoza, immediately proceeded to Tetuan Highway. The two
did not enter the house where the recruitment was supposedly being
conducted, but Fermindoza interviewed two people who informed them that
some people do go inside the house. Upon returning to their office at around
8:30 a.m., the two reported to Capt. Mendoza who organized a team to
conduct the raid.
The raiding team, which included Capt. Mendoza, SPO2
Manalopilar, Fermindoza and a certain Oscar Bucol, quickly set off and
arrived at the reported scene at 9:30 that morning. There they met up with
Erlie Ramos of the POEA. Fermindoza then proceeded to enter the house
while the rest of the team posted themselves outside to secure the area
Fermindoza was instructed to come out after she was given a bio-data form,
which will serve as the team's cue to enter the house. 4
Fermindoza introduced herself as a job applicant to a man and a
woman, apparently the owners of the house, and went inside. There, she
saw another woman, later identified as Jasmine, coming out of the bathroom.
The man to whom Fermindoza earlier introduced herself told Jasmine that
Fermindoza was applying for a position. Jasmine, who was then only wearing
a towel, told her that she would just get dressed. Jasmine then came back
and asked Fermindoza what position she was applying for. Fermindoza
replied that she was applying to be a baby-sitter or any other work so long as
she could go abroad. Jasmine then gave her an application form.
A few minutes later, a certain Carol arrived. Jasmine informed Carol
that Fermindoza was an applicant. Fermindoza asked Carol what the
requirements were and whether she (Fermindoza) was qualified. Carol told
Fermindoza that if she had a passport, she could fill up the application
papers. Fermindoza replied that she had no passport yet. Carol said she
need not worry since Jasmine will prepare the passport for her. While filling
up the application form, three women who appeared to be friends of Jasmine
arrived to follow up the result of their applications and to give their advance
payment. Jasmine got their papers and put them on top of a small table.
Fermindoza then proceeded to the door and signaled to the raiding party by
raising her hand. HaDEIc
Capt. Mendoza asked the owners of the house, a married couple, for
permission to enter the same. The owners granted permission after the
raiding party introduced themselves as members of the CIS. Inside the
house, the raiding party saw some supposed applicants. Application forms,
already filled up, were in the hands of one Mrs. Carol Figueroa. The CIS
asked Figueroa if she had a permit to recruit. Figueroa retorted that she was
not engaged in recruitment. Capt. Mendoza nevertheless proceeded to arrest
Figueroa. He took the application forms she was holding as the raiding party
seized the other papers 5 on the table. 6
The CIS team then brought Figueroa, a certain Jasmine Alejandro,
and the three women suspected to be applicants, to the office for
investigation. 7
In the course of their investigation, the CIS discovered that Carol
Figueroa had many aliases, among them, Carol Llena and
Carol dela Piedra The accused was not able to present any authority to
recruit when asked by the investigators. 8 A check by Ramos with the POEA
revealed that the accused was not licensed or authorized to conduct
recruitment. 9 A certification 10 dated February 2, 1994 stating thus was
executed by Renegold M. Macarulay, Officer-in-Charge of the POEA.
The CIS likewise interviewed the supposed applicants, Lourdes
Modesto, Nancy Araneta and Jennelyn Baez, all registered nurses working at
the Cabato Medical Hospital, who executed their respective written
statements. 11
At the trial, Nancy Araneta, 23, recounted that she was at Jasmine
Alejandro's house in the afternoon of January 30, 1994. Araneta had learned
from Sandra Aquino, also a nurse at the Cabato Medical Hospital, that a
woman was there to recruit job applicants for Singapore.
Araneta and her friends, Jennelyn Baez and Sandra Aquino, arrived
at Jasmine's house at around 4:30 p.m. Jasmine welcomed them and told
them to sit down. They listened to the "recruiter" who was then talking to a
number of people. The recruiter said that she was "recruiting" nurses for
Singapore. Araneta and her friends then filled up bio-data forms and were
required to submit pictures and a transcript of records. They were also told to
pay P2,000, and "the rest will be salary deduction." Araneta submitted her
bio-data form to Carol that same afternoon, but did not give any money
because she was "not yet sure."
On the day of the raid on February 2, 1994, Araneta was again at the
Alejandro residence to submit her transcript of records and her picture. She
arrived at the house 30 minutes before the raid but did not witness the arrest
since she was at the porch when it happened. 12
Maria Lourdes Modesto, 26, was also in Jasmine Alejandro's house
on January 30, 1994. A friend of Jasmine had informed her that there was
someone recruiting in Jasmine's house. Upon arriving at the Alejandro
residence, Lourdes was welcomed by Jasmine.
Lourdes recalled that Carol Figueroa was already briefing
some people when she arrived. Carol Figueroa asked if they would like a
"good opportunity" since a hospital was hiring nurses. She gave a breakdown
of the fees involved: P30,000 for the visa and the round trip ticket, and
P5,000 as placement fee and for the processing of papers. The initial
payment was P2,000, while P30,000 will be by salary deduction.
 Lourdes filled up the application form and submitted it to Jasmine.
After the interview, she gave the initial payment of P2,000 to Jasmine, who
assured Lourdes that she was authorized to receive the money. On February
2, 1994, however, Lourdes went back to the house to get back the money.
Jasmine gave back the money to Lourdes after the raid. 13
Denial comprised the accused's defense.
Carol dela Piedra, 37, is a housewife and a resident of Cebu City.
Her husband is a businessman from Cebu, the manager of the Region 7
Branch of the Grolier International Encyclopedia. They own an apartment in
Cebu City, providing lodging to the students.
The accused claimed that she goes to Singapore to visit her
relatives. She first traveled to Singapore on August 21, 1993 as a tourist, and
came back to the Philippines on October 20 of the same year. Thereafter,
she returned to Singapore on December 10, 1993.
On December 21, 1993, while in Singapore, the accused was invited
to a Christmas party sponsored by the Zamboanga City Club Association. On
that occasion, she met a certain Laleen Malicay, who sought her help. A
midwife, Malicay had been working in Singapore for six (6) years. Her
employer is a certain Mr. Tan, a close friend of Carol.
According to the accused, Malicay sent P15,000 home for her father
who was then seriously ill. Malicay was not sure, however, whether her father
received the money so she requested the accused to verify from her relatives
receipt thereof. She informed the accused that she had a cousin by the name
of Jasmine Alejandro. Malicay gave the accused Jasmine's telephone
number, address and a sketch of how to get there.
The accused returned to the country on January 21, 1994. From
Cebu City, the accused flew to Zamboanga City on January 23, 1994 to give
some presents to her friends.
On January 30, 1994, the accused called up Jasmine Alejandro,
Laleen Malicay's cousin, to inform her that she would be going to her house.
At around noon that day, the accused, accompanied by her friend Hilda
Falcasantos, arrived at the house where she found Jasmine entertaining
some friends. Jasmine came down with two of her friends whom she
introduced as her classmates. Jasmine told them that the accused was a
friend of Laleen Malicay.
The accused relayed to Jasmine Malicay's message regarding the
money the latter had sent. Jasmine assured her that they received the
money, and asked Carol to tell Malicay to send more money for medicine for
Malicay's mother. Jasmine also told her that she would send something for
Malicay when the accused goes back to Singapore. The accused replied that
she just needed to confirm her flight back to Cebu City, and will return to
Jasmine's house. After the meeting with Jasmine, the accused went
shopping with Hilda Falcasantos. The accused was in the house for only
fifteen (15) minutes.
On February 2, 1994, the accused went to the Philippine Airlines
office at 7:30 in the morning to confirm her 5:30 p.m. flight to Cebu City. She
then proceeded to Jasmine's residence, arriving there at past 8 am.
Inside the house, she met a woman who asked her, "Are you Carol
from Singapore?" The accused, in turn, asked the woman if she could do
anything for her. The woman inquired from Carol if she was recruiting. Carol
replied in the negative, explaining that she was there just to say goodbye to
Jasmine. The woman further asked Carol what the requirements were if she
(the woman) were to go to Singapore. Carol replied that she would need a
passport.
Two (2) minutes later, three (3) girls entered the house looking for
Jasmine. The woman Carol was talking with then stood up and went out. A
minute after, three (3) members of the CIS and a POEA official arrived. A big
man identified himself as a member of the CIS and informed her that they
received a call that she was recruiting. They told her she had just interviewed
a woman from the CIS. She denied this, and said that she came only to say
goodbye to the occupants of the house, and to get whatever Jasmine would
be sending for Laleen Malicay. She even showed them her ticket for Cebu
City.
Erlie Ramos then went up to Jasmine's room and returned with some
papers. The accused said that those were the papers that Laleen Malicay
requested Jasmine to give to her (the accused). The accused surmised that
because Laleen Malicay wanted to go home but could not find a
replacement, one of the applicants in the forms was to be her (Malicay's)
substitute. Ramos told the accused to explain in their office.
The accused denied in court that she went to Jasmine's residence to
engage in recruitment. She claimed she came to Zamboanga City to visit her
friends, to whom she could confide since she and her husband were having
some problems. She denied she knew Nancy Araneta or that she brought
information sheets for job placement. She also denied instructing Jasmine to
collect P2,000 from alleged applicants as processing fee. 14
The accused presented two witnesses to corroborate her defense.
The first, Jasmine Alejandro, 23, testified that she met the accused
for the first time only on January 30, 1994 when the latter visited them to
deliver Laleen Malicay's message regarding the money she sent. Carol, who
was accompanied by a certain Hilda Falcasantos, stayed in their house for
10 to 15 minutes only. Carol came back to the house a few days later on
February 2 at around 8:00 in the morning to "get the envelope for the
candidacy of her daughter." Jasmine did not elaborate.
 Jasmine denied that she knew Nancy Araneta or Lourdes Modesto.
She denied that the accused conducted recruitment. She claimed she did not
see Carol distribute bio-data or application forms to job applicants. She
disclaimed any knowledge regarding the P2,000 application fee. 15
The other defense witness, Ernesto Morales, a policeman, merely
testified that the accused stayed in their house in No. 270 Tugbungan,
Zamboanga City, for four (4) days before her arrest, although she would
sometimes go downtown alone. He said he did not notice that she conducted
any recruitment. 16
On May 5, 1995, the trial court rendered a decision convicting the
accused, thus:
WHEREFORE, in view of all the foregoing
consideration[s][,] this Court finds the accused
Carol dela Piedra alias Carol Llena and Carol Figueroa
guilty beyond reasonable doubt of Illegal Recruitment
committed in a large scale and hereby sentences her to
suffer the penalty of LIFE IMPRISONMENT and to pay a
fine of P100,000.00, and also to pay the costs.
Being a detention prisoner, the said accused is
entitled to the full time of the period of her detention during
the pendency of this case under the condition set forth in
Article 29 of the Revised Penal Code.
SO ORDERED. 17
The accused, in this appeal, ascribes to the trial court the following
errors:
I WAS NOT ILLEGALLY RECRUITED BY THE ACCUSED-
WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT FINDING SEC. 13 (B) OF P.D. 442[,] AS
AMENDED[,] OTHERWISE KNOWN AS [THE] ILLEGAL
RECRUITMENT LAW UNCONSTITUTIONAL.
II
WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT HOLDING THAT THE APPREHENDING TEAM
COMPOSED OF POEA AND CIS REPRESENTATIVES
ENTERED INTO [sic] THE RESIDENCE OF JASMIN[E]
ALEJANDRO WITHOUT ANY SEARCH WARRANT IN
VIOLATION OF ARTICLE III, SECTION 2 OF
THE PHILIPPINE CONSTITUTION, AND ANY EVIDENCE
OBTAINED IN VIOLATION THEREOF, SHALL BE
INADMISSIBLE FOR ANY PURPOSE IN ANY
PROCEEDING AS PROVIDED UNDER ARTICLE III,
SECTION 3, (2) OF THE SAME CONSTITUTION;
III
WITH DUE RESPECT, THE LOWER COURT ERRED IN
IGNORING THAT WHEN SPO2 [sic] EILE[E]N
FERMINDOZA ENTERED THE RESIDENCE OF
JASMIN[E] ALEJANDRO, THERE WAS NO CRIME
COMMITTED WHATSOEVER, HENCE THE ARREST OF
THE ACCUSED-APPELLANT WAS ILLEGAL;
[IV]
WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT DISCOVERING THAT SPO2 [sic] EILE[E]N
FERMINDOZA WAS NOT ILLEGALLY RECRUITED BY
THE ACCUSED-APPELLANT, HENCE, ACCUSED-
APPELLANT SHOULD BE ACQUITTED;
V
WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT DETECTING THAT NANCY ARANETA WAS NOT
ILLEGALLY RECRUITED BY THE ACCUSED-
APPELLANT, HENCE, ACCUSED SHOULD BE
EXONERATED;
VI
WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT REALIZING THAT MARIA LOURDES MODESTO
APPELLANT, HENCE, ACCUSED-APPELLANT SHOULD
BE EXCULPATED;
VII
WITH DUE RESPECT, THE LOWER COURT ERRED IN
FINDING THAT THE ACCUSED-APPELLANT WAS
CHARGED WITH LARGE SCALE ILLEGAL
RECRUITMENT ON JANUARY 30, 1994, THE DATE
STATED IN THE INFORMATION AS THE DATE OF THE
CRIME, BUT ACCUSED WAS ARRESTED ON FEB. 2,
1994 AND ALL THE EVIDENCES [sic] INDICATED [sic]
THAT THE ALLEGED CRIME WERE [sic] COMMITTED
ON FEB. 2, 1994, HENCE, THE INFORMATION IS
FATALLY DEFECTIVE;
VIII
 WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT FINDING THAT THE ALLEGED CRIME OF ILLEGAL
RECRUITMENT WAS COMMITTED NOT ON [sic] LARGE
SCALE, HENCE, THE PENALTY SHOULD NOT BE LIFE
IMPRISONMENT;
IX
WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT FINDING THAT THOSE EVIDENCES [sic] SEIZED
AT THE HOUSE OF JASMIN[E] ALEJANDRO AND
PRESENTED TO THE COURT WERE PLANTED BY A
BOGUS ATTORNEY[,] ERLIE S. RAMOS OF THE POEA;
X is to say, it cannot be clarified by either a saving clause or
WITH DUE RESPECT, THE LOWER COURT ERRED IN
NOT DISCOVERING THAT ACCUSED-APPELLANT DID
NOT RECEIVE ANY PAYMENT EVEN A SINGLE
CENTAVO FROM THE ALLEGED VICTIMS WHO DID
NOT SUFFER DAMAGE IN ANY MANNER, YET SHE
WAS CONVICTED TO SERVE HER ENTIRE LIFE
BEHIND PRISON BARS. SUCH PUNISHMENT WAS
CRUEL AND UNUSUAL, HENCE, A WANTON
VIOLATION OF THE CONSTITUTION. 18
In the first assigned error, appellant maintains that the law defining
"recruitment and placement" violates due process. Appellant also avers, as
part of her sixth assigned error, that she was denied the equal protection of
the laws. EHSADc
We shall address the issues jointly.
Appellant submits that Article 13 (b) of the Labor Code defining
"recruitment and placement" is void for vagueness and, thus, violates the due
process clause. 19
Due process requires that the terms of a penal statute must be
sufficiently explicit to inform those who are subject to it what conduct on their
part will render them liable to its penalties. 20 A criminal statute that "fails to
give a person of ordinary intelligence fair notice that his contemplated
conduct is forbidden by the statute," or is so indefinite that "it encourages
arbitrary and erratic arrests and convictions," is void for vagueness. 21 The
constitutional vice in a vague or indefinite statute is the injustice to the
accused in placing him on trial for an offense, the nature of which he is given
no fair warning. 22
We reiterated these principles in People  vs. Nazario: 23
As a rule, a statute or act may be said to be vague
when it lacks comprehensible standards that men "of
common intelligence must necessarily guess at its
meaning and differ as to its application." It is repugnant to
the Constitution in two respects: (1) it violates due process
for failure to accord persons, especially the parties
targeted by it, fair notice of the conduct to avoid; and (2) it
leaves law enforcers unbridled discretion in carrying out its
provisions and become an arbitrary flexing of the
Government muscle.
We added, however, that:
. . . the act must be utterly vague on its face, that
by construction. Thus, in Coates  v. City of Cincinnati, the
U.S. Supreme Court struck down an ordinance that had
made it illegal for "three or more persons to assemble on
any sidewalk and there conduct themselves in a manner
annoying to persons passing by." Clearly, the ordinance
imposed no standard at all "because one may never know
in advance what 'annoys some people but does not annoy
others.'"
Coates  highlights what has been referred to as a
"perfectly vague" act whose obscurity is evident on its
face. It is to be distinguished, however, from legislation
couched in imprecise language — but which nonetheless
specifies a standard though defectively phrased — in
which case, it may be "saved" by proper construction.
Here, the provision in question reads:
ARTICLE 13. Definitions. — (a) . . . .
(b) "Recruitment and placement" refers to any act
of canvassing, enlisting, contracting, transporting, utilizing,
hiring or procuring workers, and includes referrals, contract
services, promising or advertising for employment, locally
or abroad, whether for profit or not: Provided, That any
person or entity which, in any manner, offers or promises
for a fee employment to two or more persons shall be
deemed engaged in recruitment and placement.
xxx xxx xxx
When undertaken by non-licensees or non-holders of authority,
recruitment activities are punishable as follows:
 ARTICLE 38. Illegal Recruitment. — (a) Any
recruitment activities, including the prohibited practices
enumerated under Article 34 of this Code, to be
undertaken by non-licensees or non-holders of authority
shall be deemed illegal and punishable under Article 39 of
this Code. The Ministry of Labor and Employment or any
law enforcement officer may initiate complaints under this
Article.
(b) Illegal recruitment when committed by a
syndicate or in large scale shall be considered an offense
involving economic sabotage and shall be penalized in
accordance with Article 39 hereof.
Illegal recruitment is deemed committed by a
syndicate if carried out by a group of three (3) or more
persons conspiring and/or confederating with one another
in carrying out any unlawful or illegal transaction,
enterprise or scheme defined under the first paragraph
hereof. Illegal recruitment is deemed committed in large
scale if committed against three (3) or more persons
individually or as a group.
xxx xxx xxx
ARTICLE 39. Penalties. — (a) The penalty of life
imprisonment and a fine of One Hundred Thousand Pesos
(P100,000) shall be imposed if illegal recruitment
constitutes economic sabotage as defined herein:
(b) Any licensee or holder of authority found
violating or causing another to violate any provision of this
Title or its implementing rules and regulations, shall upon
conviction thereof, suffer the penalty of imprisonment of
not less than five years or a fine of not less than P10,000
nor more than P50,000 or both such imprisonment and
fine, at the discretion of the court;
(c) Any person who is neither a licensee nor a
holder of authority under this Title found violating any
provision thereof or its implementing rules and regulations
shall, upon conviction thereof, suffer the penalty of
imprisonment of not less than four years nor more than
eight years or a fine of not less than P20,000 nor more
than P100,000 or both such imprisonment and fine, at the
discretion of the court;
xxx xxx xxx
In support of her submission that Article 13 (b) is void for vagueness,
appellant invokes People  vs. Panis, 24 where this Court, to use appellant's
term, "criticized" the definition of "recruitment and placement" as follows:
It is unfortunate that we can only speculate on the
meaning of the questioned provision for lack of records of
debates and deliberations that would otherwise have been
available if the Labor Code had been enacted as a statute
rather than a presidential decree is that they could be, and
sometimes were, issued without previous public discussion
or consultation, the promulgator heeding only his own
counsel or those of his close advisers in their lofty pinnacle
of power. The not infrequent results are rejection,
intentional or not, of the interest of the greater number
and, as in the instant case, certain esoteric provisions that
one cannot read against the background facts usually
reported in the legislative journals.
If the Court in Panis "had to speculate on the meaning of the
questioned provision," appellant asks, what more "the ordinary citizen" who
does not possess the "necessary [legal] knowledge?"
Appellant further argues that the acts that constitute "recruitment and
placement" suffer from overbreadth since by merely "referring" a person for
employment, a person may be convicted of illegal recruitment.
These contentions cannot be sustained.
Appellant's reliance on People  vs. Panis is misplaced. The issue
in Panis  was whether, under the proviso of Article 13 (b), the crime of illegal
recruitment could be committed only "whenever two or more persons are in
any manner promised or offered any employment for a fee." The Court held
in the negative, explaining:
As we see it, the proviso was intended neither to
impose a condition on the basic rule nor to provide an
exception thereto but merely to create a presumption. The
presumption is that the individual or entity is engaged in
recruitment and placement whenever he or it is dealing
with two or more persons to whom, in consideration of a
fee, an offer or promise of employment is made in the
course of the "canvassing, enlisting, contracting,
transporting, utilizing, hiring or procuring (of) workers."
The number of persons dealt with is not an
essential ingredient of the act of recruitment and
placement of workers. Any of the acts mentioned in the
basic rule in Article 13(b) will constitute recruitment and
placement even if only one prospective worker is involved.
 The proviso merely lays down a rule of evidence that
where a fee is collected in consideration of a promise or
offer of employment to two or more prospective workers,
the individual or entity dealing with them shall be deemed
to be engaged in the act of recruitment and placement.
The words "shall be deemed" create that presumption.
This is not unlike the presumption in article 217 of
the Revised Penal Code, for example, regarding the failure
of a public officer to produce upon lawful demand funds or
property entrusted to his custody. Such failure shall
be  prima facie evidence  that he has put them to personal
use; in other words, he shall be deemed to have
malversed such funds or property. In the instant case, the
word "shall be deemed" should by the same token be
given the force of a disputable presumption or of prima
facie evidence of engaging in recruitment and placement.
It is unfortunate that we can only speculate on the
meaning of the questioned provision for lack of records of
debates and deliberations that would otherwise have been
available if the Labor Code had been enacted as a statute
rather than a presidential decree is that they could be, and
sometimes were, issued without previous public discussion
or consultation, the promulgator heeding only his own
counsel or those of his close advisers in their lofty pinnacle
of power. The not infrequent results are rejection,
intentional or not, of the interest of the greater number
and, as in the instant case, certain esoteric provisions that
one cannot read against the background facts usually
reported in the legislative journals.
At any rate, the interpretation here adopted should
give more force to the campaign against illegal recruitment
and placement, which has victimized many Filipino
workers seeking a better life in a foreign land, and
investing hard-earned savings or even borrowed funds in
pursuit of their dream, only to be awakened to the reality of
a cynical deception at the hands of their own countrymen.
Evidently, therefore, appellant has taken the penultimate paragraph
in the excerpt quoted above out of context. The Court, in Panis, merely
bemoaned the lack of records that would help shed light on the meaning of
the proviso. The absence of such records notwithstanding, the Court was
able to arrive at a reasonable interpretation of the proviso by applying
principles in criminal law and drawing from the language and intent of the law
itself. Section 13 (b), therefore, is not a "perfectly vague act" whose obscurity
is evident on its face. If at all, the proviso therein is merely couched in
imprecise language that was salvaged by proper construction. It is not void
for vagueness.
An act will be declared void and inoperative on the
ground of vagueness and uncertainty, only upon a
showing that the defect is such that the courts are unable
to determine, with any reasonable degree of certainty,
what the legislature intended. . . . . In this connection we
cannot pretermit reference to the rule that "legislation
should not be held invalid on the ground of uncertainty if
susceptible of any reasonable construction that will
support and give it effect. An Act will not be declared
inoperative and ineffectual on the ground that it furnishes
no adequate means to secure the purpose for which it is
passed, if men of common sense and reason can devise
and provide the means, and all the instrumentalities
necessary for its execution are within the reach of those
intrusted therewith." 25
That Section 13 (b) encompasses what appellant apparently
considers as customary and harmless acts such as "labor or employment
referral" ("referring" an applicant, according to appellant, for employment to a
prospective employer) does not render the law overbroad. Evidently,
appellant misapprehends concept of overbreadth.
A statute may be said to be overbroad where it operates to inhibit the
exercise of individual freedoms affirmatively guaranteed by the Constitution,
such as the freedom of speech or religion. A generally worded statute, when
construed to punish conduct which cannot be constitutionally punished is
unconstitutionally vague to the extent that it fails to give adequate warning of
the boundary between the constitutionally permissible and the constitutionally
impermissible applications of the statute. 26
In Blo Umpar Adiong  vs. Commission on Elections, 27 for instance,
we struck down as void for overbreadth provisions prohibiting the posting of
election propaganda in any place — including private vehicles — other than
in the common poster areas sanctioned by the COMELEC. We held that the
challenged provisions not only deprived the owner of the vehicle the use of
his property but also deprived the citizen of his right to free speech and
information. The prohibition in  Adiong, therefore, was so broad that it
covered even constitutionally guaranteed rights and, hence, void for
overbreadth. In the present case, however, appellant did not even specify
what constitutionally protected freedoms are embraced by the definition of
"recruitment and placement" that would render the same constitutionally
overbroad.
Appellant also invokes the equal protection clause 28 in her defense.
She points out that although the evidence purportedly shows that Jasmine
Alejandro handed out application forms and even received Lourdes
Modesto's payment, appellant was the only one criminally charged.
Alejandro, on the other hand, remained scot-free. From this, appellant
concludes that the prosecution discriminated against her on grounds of
regional origins. Appellant is a Cebuana while Alejandro is a Zamboangueña,
and the alleged crime took place in Zamboanga City.
The argument has no merit.
At the outset, it may be stressed that courts are not confined to the
language of the statute under challenge in determining whether that statute
has any discriminatory effect. A statute nondiscriminatory on its face may be
grossly discriminatory in its operation. 29 Though the law itself be fair on its
face and impartial in appearance, yet, if it is applied and administered by
public authority with an evil eye and unequal hand, so as practically to make
unjust and illegal discriminations between persons in similar circumstances,
material to their rights, the denial of equal justice is still within the prohibition
of the Constitution. 30
The prosecution of one guilty person while others equally guilty are
not prosecuted, however, is not, by itself, a denial of the equal protection of
the laws. 31 Where the official action purports to be in conformity to the
statutory classification, an erroneous or mistaken performance of the
statutory duty, although a violation of the statute, is not without more a denial
of the equal protection of the laws. 32 The unlawful administration by officers
of a statute fair on its face, resulting in its unequal application to those who
are entitled to be treated alike, is not a denial of equal protection unless there
is shown to be present in it an element
of intentional or  purposeful discrimination. This may appear on the face of
the action taken with respect to a particular class or person, or it may only be
shown by extrinsic evidence showing a discriminatory design over another
not to be inferred from the action itself. But a discriminatory purpose is not
presumed, there must be a showing of "clear and intentional
discrimination." 33 Appellant has failed to show that, in charging appellant in
court, that there was a "clear and intentional discrimination" on the part of the
prosecuting officials.
The discretion of who to prosecute depends on the prosecution's
sound assessment whether the evidence before it can justify a reasonable
belief that a person has committed an offense. 34 The presumption is that
the prosecuting officers regularly performed their duties, 35 and this
presumption can be overcome only by proof to the contrary, not by mere
speculation. Indeed, appellant has not presented any evidence to overcome
this presumption. The mere allegation that appellant, a Cebuana, was
charged with the commission of a crime, while a Zamboangueña, the guilty
party in appellant's eyes, was not, is insufficient to support a conclusion that
the prosecution officers denied appellant equal protection of the laws.
There is also common sense practicality in sustaining appellant's
prosecution.
While all persons accused of crime are to be
treated on a basis of equality before the law, it does not
follow that they are to be protected in the commission of
crime. It would be unconscionable, for instance, to excuse
a defendant guilty of murder because others have
murdered with impunity. The remedy for unequal
enforcement of the law in such instances does not lie in
the exoneration of the guilty at the expense of society . . . .
Protection of the law will be extended to all persons
equally in the pursuit of their lawful occupations, but no
person has the right to demand protection of the law in the
commission of a crime. 36
Likewise,
[i]f the failure of prosecutors to enforce the criminal
laws as to some persons should be converted into a
defense for others charged with crime, the result would be
that the trial of the district attorney for nonfeasance would
become an issue in the trial of many persons charged with
heinous crimes and the enforcement of law would suffer a
complete breakdown. 37
We now come to the third, fourth and fifth assigned errors, all of
which involve the finding of guilt by the trial court.
Illegal recruitment is committed when two elements concur. First, the
offender has no valid license or authority required by law to enable one to
lawfully engage in recruitment and placement of workers. Second, he or she
undertakes either any activity within the meaning of '"recruitment and
placement" defined under Article 13 (b), or any prohibited practices
enumerated under Article 34 of the Labor Code.38 In case of illegal
recruitment  in large scale,  a third element is added: that the accused
commits said acts against three or more persons, individually or as a
group. 39
In this case, the first element is present. The certification of POEA
Officer-in-Charge Macarulay states that appellant is not licensed or
authorized to engage in recruitment and placement. TSEcAD
The second element is also present. Appellant is presumed engaged
in recruitment and placement under Article 13 (b) of the Labor Code.Both
Nancy Araneta and Lourdes Modesto testified that appellant promised them
employment for a fee. Their testimonies corroborate each other on material
points: the briefing conducted by appellant, the time and place thereof, the
fees involved. Appellant has not shown that these witnesses were incited by
any motive to testify falsely against her. The absence of evidence as to an
improper motive actuating the principal witnesses of the prosecution strongly
tends to sustain that no improper motive existed and that their testimony is
worthy of full faith and credence. 40
Appellant's denials cannot prevail over the positive declaration of the
prosecution witnesses. Affirmative testimony of persons who are
eyewitnesses of the fact asserted easily overrides negative testimony. 41
That appellant did not receive any payment for the promised or
offered employment is of no moment. From the language of the statute, the
act of recruitment may be "for profit or not;" it suffices that the accused
"promises or offers for a fee employment" to warrant conviction for illegal
recruitment.
The testimonies of Araneta and Modesto, coming as they do from
credible witnesses, meet the standard of proof beyond reasonable doubt that
appellant committed recruitment and placement. We therefore do not deem it
necessary to delve into the second and third assigned errors assailing the
legality of appellant's arrest and the seizure of the application forms. A
warrantless arrest, when unlawful, has the effect of invalidating the search
incidental thereto and the articles so seized are rendered inadmissible in
evidence. 42 Here, even if the documents seized were deemed inadmissible,
her conviction would stand in view of Araneta and Modesto's testimonies.
Appellant attempts to cast doubt on the prosecution's case by
claiming in her ninth assigned error that Erlie Ramos of the POEA
supposedly "planted" the application forms. She also assails his character,
alleging that he passed himself off as a lawyer, although this was denied by
Ramos.
The claim of "frame-up," like alibi, is a defense that has been
invariably viewed by the Court with disfavor for it can easily be concocted but
difficult to prove. 43 Apart from her self-serving testimony, appellant has not
offered any evidence that she was indeed framed by Ramos. She has not
even hinted at any motive for Ramos to frame her. Law enforcers are
presumed to have performed their duties regularly in the absence of
evidence to the contrary. 44
Considering that the two elements of lack of license or authority and
the undertaking of an activity constituting recruitment and placement are
present, appellant, at the very least, is liable for "simple" illegal recruitment.
But is she guilty of illegal recruitment in large scale? We find that she is not.
A conviction for large scale illegal recruitment must be based on a
finding in each case of illegal recruitment of three or more persons whether
individually or as a group. 45 In this case, only two persons, Araneta and
Modesto, were proven to have been recruited by appellant. The third person
named in the complaint as having been promised employment for a fee,
Jennelyn Baez, was not presented in court to testify.
It is true that law does not require that at least three victims testify at
the trial; nevertheless, it is necessary that there is sufficient evidence proving
that the offense was committed against three or more persons. 46 In this
case, evidence that appellant likewise promised her employment for a fee is
sketchy. The only evidence that tends to prove this fact is the testimony of
Nancy Araneta, who said that she and her friends, Baez and Sandra Aquino,
came to the briefing and that they (she and her "friends") filled up application
forms.
The affidavit 47 Baez executed jointly with Araneta cannot support
Araneta's testimony. The affidavit was neither identified, nor its contents
affirmed, by Baez. Insofar as it purports to prove that appellant recruited
Baez, therefore, the affidavit is hearsay and inadmissible. 48 In any case,
hearsay evidence, such as the said affidavit, has little probative value. 49
Neither can appellant be convicted for recruiting CIS agent Eileen
Fermindoza or even the other persons present in the briefing of January 30,
1994. Appellant is accused of recruiting only the three persons named in the
information — Araneta, Modesto and Baez. The information does not include
Fermindoza or the other persons present in the briefing as among those
promised or offered employment for a fee. To convict appellant for the
recruitment and placement of persons other than those alleged to have been
offered or promised employment for a fee would violate her right to be
informed of the nature and cause of the accusation against her. 50
In any event, the purpose of the offer of the testimonies of Araneta,
Morales and Fermindoza, respectively, was limited as follows:
FISCAL BELDUA:
 Your Honor please, we are offering the oral testimony of
the witness, as one of those recruited by the
accused, and also to identify some exhibits for the
prosecution and as well as to identify the
accused. 51
xxx xxx xxx
FISCAL BELDUA:
 We are offering the oral testimony of the witness, Your
Honor, to testify on the fact about her recruitment
by the accused and immediately before the
recruitment, as well as to identify some exhibits for
the prosecution, and also the accused in this case,
Your Honor. 52
 xxx xxx xxx assumes that the proper imposable penalty upon appellant is life
imprisonment.
FISCAL BELDUA:
WHEREFORE, the decision of the regional trial court is MODIFIED.
 This witness is going to testify that at around that date
Appellant is hereby declared guilty of illegal recruitment on two (2) counts
Your Honor, she was connected with the CIS, that
and is sentenced, for each count, to suffer the penalty of four (4) to six (6)
she was instructed together with a companion to
years of imprisonment and to pay a fine P30,000.00.
conduct a surveillance on the place where the
illegal recruitment was supposed to be going on, SO ORDERED.
that she acted as an applicant, Your Honor, to
ascertain the truthfulness of the illegal recruitment
going on, to identify the accused, as well as to
identify some exhibits for the prosecution. 53
xxx xxx xxx
Courts may consider a piece of evidence only for the purpose for
which it was offered, 54 and the purpose of the offer of their testimonies did
not include the proving of the purported recruitment of other supposed
applicants by appellant.
Appellant claims in her seventh assigned error that the information is
fatally defective since it charges her with committing illegal recruitment in
large scale on January 30, 1994 while the prosecution evidence supposedly
indicates that she committed the crime on February 2, 1994.
We find that the evidence for the prosecution regarding the date of
the commission of the crime does not vary from that charged in the
information. Both Nancy Araneta and Lourdes Modesto testified that on
January 30, 1994, while in the Alejandro residence, appellant offered them
employment for a fee. Thus, while the arrest was effected only on February
THIRD DIVISION
2, 1994, the crime had already been committed three (3) days earlier on
January 30, 1994.
[G.R. No. 172642. June 13, 2012.]
The eighth and tenth assigned errors, respectively, pertain to the
penalty of life imprisonment imposed by the trial court as well as the
constitutionality of the law prescribing the same, appellant arguing that it is ESTATE OF NELSON R. DULAY, represented by his
unconstitutional for being unduly harsh. 55 wife MERRIDY JANE
P. DULAY,  petitioner, vs.  ABOITIZ JEBSEN  MARITIME,
The penalty of life imprisonment imposed upon appellant must be INC. and GENERAL CHARTERERS, INC.,  respondents.
reduced. Because the prosecution was able to prove that appellant
committed recruitment and placement against two persons only, she cannot
be convicted of illegal recruitment in large scale, which requires that
recruitment be committed against three or more persons. Appellant can only DECISION
be convicted of two counts of "simple" illegal recruitment, one for that
committed against Nancy Araneta, and another count for that committed
against Lourdes Modesto. Appellant is sentenced, for each count, to suffer
the penalty of four (4) to six (6) years of imprisonment and to pay a fine of PERALTA, * J :
P30,000.00. This renders immaterial the tenth assigned error, which
 Before the Court is a petition for review on certiorari under Rule
45 of the Rules of Court seeking to reverse and set aside the Decision 1 and
Resolution 2 dated July 11, 2005 and April 18, 2006 of the Court of Appeals
(CA) in CA-G.R. SP No. 76489.
The factual and procedural antecedents of the case, as summarized
by the CA, are as follows:
Nelson R. Dulay (Nelson, for brevity) was
employed by [herein respondent] General Charterers, Inc.
(GCI), a subsidiary of co-petitioner [herein co-
respondent] Aboitiz Jebsen Maritime, Inc. since 1986. He
initially worked as an ordinary seaman and later as bosun
on a contractual basis. From September 3, 1999 up to July
19, 2000, Nelson was detailed in petitioners' vessel, the
MV Kickapoo Belle.
On August 13, 2000, or 25 days after the
completion of his employment contract, Nelson died due to
acute renal failure secondary to septicemia. At the
time of his death, Nelson was a bona fide member of the
Associated Marine Officers and Seaman's Union of the
Philippines (AMOSUP), GCI's collective bargaining
agent. Nelson's widow, Merridy Jane, thereafter claimed
for death benefits through the grievance procedure of the
Collective Bargaining Agreement (CBA) between
AMOSUP and GCI. However, on January 29, 2001, the
grievance procedure was "declared deadlocked" as
petitioners refused to grant the benefits sought by the
widow.
On March 5, 2001, Merridy Jane filed a complaint
with the NLRC Sub-Regional Arbitration Board in General
Santos City against GCI for death and medical benefits
and damages. aIEDAC
On March 8, 2001, Joven Mar, Nelson's brother,
received P20,000.00 from [respondents] pursuant to article
20(A)2 of the CBA and signed a "Certification"
acknowledging receipt of the amount and releasing
AMOSUP from further liability. Merridy Jane contended
that she is entitled to the aggregate sum of Ninety
Thousand Dollars ($90,000.00) pursuant to [A]rticle 20
(A)1 of the CBA . . .
xxx xxx xxx
Merridy Jane averred that the P20,000.00 already
received by Joven Mar should be considered advance
payment of the total claim of US$90,000.[00].
[Herein respondents], on the other hand, asserted
that the NLRC had no jurisdiction over the action on
account of the absence of employer-employee relationship
between GCI and Nelson at the time of the latter's
death. Nelson also had no claims against petitioners for
sick leave allowance/medical benefit by reason of the
completion of his contract with GCI. They further alleged
that private respondent is not entitled to death benefits
because petitioners are only liable for such "in
case of death of the seafarer during the term of his
contract pursuant to the POEA contract" and the
cause of his death is not work-related. Petitioners admitted
liability only with respect to article 20(A)2 [of the CBA]. . . .
xxx xxx xxx
However, as petitioners stressed, the same was
already discharged.
The Labor Arbiter ruled in favor of private
respondent. It took cognizance of the case by
virtue of Article 217 (a), paragraph 6 of the Labor Code
and the existence of a reasonable causal connection
between the employer-employee relationship and the
claim asserted. It ordered the petitioner to pay
P4,621,300.00, the equivalent of US$90,000.00 less
P20,000.00, at the time of judgment . . .
xxx xxx xxx
The Labor Arbiter also ruled that the proximate
cause of Nelson's death was not work-related.
On appeal, [the NLRC] affirmed the Labor Arbiter's
decision as to the grant of death benefits under the CBA
but reversed the latter's ruling as to the proximate
cause of Nelson's death. 3
Herein respondents then filed a special civil action for certiorari with
the CA contending that the NLRC committed grave abuse of discretion in
affirming the jurisdiction of the NLRC over the case; in ruling that a different
provision of the CBA covers the death claim; in reversing the findings of the
Labor Arbiter that the cause of death is not work-related; and, in setting aside
the release and quitclaim executed by the attorney-in-fact and not
considering the P20,000.00 already received by Merridy Jane through her
attorney-in-fact.
On July 11, 2005, the CA promulgated its assailed Decision, the
dispositive portion of which reads as follows: AICDSa
WHEREFORE, in view of the foregoing, the
petition is hereby GRANTED and the case is REFERRED
to the National Conciliation and Mediation Board for the
designation of the Voluntary Arbitrator or the
constitution of a panel of Voluntary Arbitrators for the
appropriate resolution of the issue on the matter of the
applicable CBA provision.
SO ORDERED. 4
The CA ruled that while the suit filed by Merridy Jane is a money
claim, the same basically involves the interpretation and application of the
provisions in the subject CBA. As such, jurisdiction belongs to the voluntary
arbitrator and not the labor arbiter.
Petitioner filed a Motion for Reconsideration but the CA denied it in
its Resolution of April 18, 2006.
Hence, the instant petition raising the sole issue of whether or not
the CA committed error in ruling that the Labor Arbiter has no jurisdiction
over the case.
Petitioner contends that Section 10 of Republic Act (R.A.) 8042,
otherwise known as the Migrant Workers and Overseas Filipinos Act  of 1995,
vests jurisdiction on the appropriate branches of the NLRC to entertain
disputes regarding the interpretation of a collective bargaining agreement
involving migrant or overseas Filipino workers. Petitioner argues that the
abovementioned Section amended Article 217 (c) of the Labor Code which,
in turn, confers jurisdiction upon voluntary arbitrators over interpretation or
implementation of collective bargaining agreements and interpretation or
enforcement of company personnel policies.
The pertinent provisions of Section 10 of R.A. 8042 provide as
follows:
SEC. 10. Money Claims. — Notwithstanding any
provision of law to the contrary, the Labor Arbiters of the
National Labor Relations Commission (NLRC) shall have
the original and exclusive jurisdiction to hear and decide,
within ninety (90) calendar days after filing of the
complaint, the claims arising out of an employer-employee
relationship or by virtue of any law or contract involving
Filipino workers for overseas deployment including claims
for actual, moral, exemplary and other forms of damages.
Article 217 (c) of the Labor Code, on the other hand, states that:
xxx xxx xxx
(c) Cases arising from the interpretation or
implementation of collective bargaining agreements and
those arising from the interpretation or
enforcement of company personnel policies shall be
disposed by the Labor Arbiter by referring the same to the
grievance machinery and voluntary arbitration as may be
provided in said agreements. cCSHET
On their part, respondents insist that in the present case, Article 217,
paragraph (c) as well as Article 261 of the Labor Code remain to be the
governing provisions of law with respect to unresolved grievances arising
from the interpretation and implementation of collective bargaining
agreements. Under these provisions of law, jurisdiction remains with
voluntary arbitrators.
Article 261 of the Labor Code reads, thus:
ARTICLE 261. Jurisdiction  of  Voluntary
Arbitrators or panel  of  Voluntary Arbitrators. — The
Voluntary Arbitrator or panel of Voluntary Arbitrators shall
have 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 referred to in
the immediately preceding article. Accordingly,
violations of a Collective Bargaining Agreement, except
those which are gross in character, shall no longer be
treated as unfair labor practice and shall be resolved as
grievances under the Collective Bargaining Agreement.
For purposes of this article, gross violations of Collective
Bargaining Agreement shall mean flagrant and/or
malicious refusal to comply with the economic
provisions of such agreement.
The Commission, its Regional Offices and the
Regional Directors of the Department of Labor and
Employment shall not entertain disputes, grievances or
matters under the exclusive and original jurisdiction of the
Voluntary Arbitrator or panel of Voluntary Arbitrators and
shall immediately dispose and refer the same to the
Grievance Machinery or Voluntary Arbitration provided in
the Collective Bargaining Agreement.
The petition is without merit.
 It is true that R.A. 8042 is a special law governing overseas Filipino
workers. However, a careful reading of this special law would readily show
that there is no specific provision thereunder which provides for jurisdiction
over disputes or unresolved grievances regarding the interpretation or
implementation of a CBA. Section 10 of R.A. 8042, which is cited by
petitioner, simply speaks, in general, of "claims arising out of an employer-
employee relationship or by virtue of any law or contract involving Filipino
workers for overseas deployment including claims for actual, moral,
exemplary and other forms of damages." On the other hand, Articles 217 (c)
and 261 of the Labor Code are very specific in stating that voluntary
arbitrators have jurisdiction over cases arising from the interpretation or
implementation of collective bargaining agreements. Stated differently, the
instant case involves a situation where the special statute (R.A. 8042) refers
to a subject in general, which the general statute (Labor Code) treats in
particular. 5 In the present case, the basic issue raised by Merridy Jane in
her complaint filed with the NLRC is: which provision of the subject CBA
applies insofar as death benefits due to the heirs of Nelson are concerned.
The Court agrees with the CA in holding that this issue clearly involves the
interpretation or implementation of the said CBA. Thus, the specific or special
provisions of the Labor Code govern. ACcaET
In any case, the Court agrees with petitioner's contention that the
CBA is the law or contract between the parties. Article 13.1 of the CBA
entered into by and between respondent GCI and AMOSUP, the union to
which petitioner belongs, provides as follows:
The Company and the Union agree that in
case of dispute or conflict in the interpretation or
application of any of the provisions of this Agreement,
or enforcement of Company policies, the same shall
be settled through negotiation, conciliation or
voluntary arbitration. The Company and the Union
further agree that they will use their best endeavor to
ensure that any dispute will be discussed, resolved and
settled amicably by the parties hereof within ninety (90)
days from the date of filing of the dispute or conflict and in
case of failure to settle thereof any of the parties retain
their freedom to take appropriate action. 6 (Emphasis
supplied)
From the foregoing, it is clear that the parties, in the first place, really
intended to bring to conciliation or voluntary arbitration any dispute or conflict
in the interpretation or application of the provisions of their CBA. It is settled
that when the parties have validly agreed on a procedure for resolving
grievances and to submit a dispute to voluntary arbitration then that
procedure should be strictly observed. 7
It may not be amiss to point out that the abovequoted
provisions of the CBA are in consonance with Rule VII, Section 7 of the
present Omnibus Rules and Regulations Implementing the Migrant Workers
and Overseas Filipinos Act of 1995, as amended by Republic Act No. 10022,
which states that "[f]or OFWs with collective bargaining agreements, the case
shall be submitted for voluntary arbitration in accordance with Articles 261
and 262 of the Labor Code." The Court notes that the said Omnibus Rules
and Regulations were promulgated by the Department of Labor and
Employment (DOLE) and the Department of Foreign Affairs (DFA) and that
these departments were mandated to consult with the Senate Committee on
Labor and Employment and the House of Representatives Committee on
Overseas Workers Affairs.
In the same manner, Section 29 of the prevailing Standard Terms
and Conditions Governing the Employment of Filipino Seafarers on Board
Ocean Going Vessels, promulgated by the Philippine Overseas Employment
Administration (POEA), provides as follows:
Section 29. Dispute Settlement Procedures. — In
cases of claims and disputes arising from this
employment, the parties covered by a collective
bargaining agreement shall submit the claim or
dispute to the original and exclusive jurisdiction of the
voluntary arbitrator or panel of arbitrators. If the parties
are not covered by a collective bargaining agreement, the
parties may at their option submit the claim or dispute to
either the original and exclusive jurisdiction of the National
Labor Relations Commission (NLRC), pursuant
to Republic Act (RA) 8042, otherwise known as
the Migrant Workers and Overseas Filipinos Act  of 1995 or
to the original and exclusive jurisdiction of the voluntary
arbitrator or panel of arbitrators. If there is no provision as
to the voluntary arbitrators to be appointed by the parties,
the same shall be appointed from the accredited voluntary
arbitrators of the National Conciliation and Mediation
Board of the Department of Labor and
Employment. DHSEcI
The Philippine Overseas Employment
Administration (POEA) shall exercise original and
exclusive jurisdiction to hear and decide disciplinary action
on cases, which are administrative in character, involving
or arising out of violations of recruitment laws, rules and
regulations involving employers, principals, contracting
partners and Filipino seafarers. (Emphasis supplied)
It is clear from the above that the interpretation of the DOLE, in
consultation with their counterparts in the respective committees of the
Senate and the House of Representatives, as well as the DFA and the POEA
is that with respect to disputes involving claims of Filipino seafarers wherein
the parties are covered by a collective bargaining agreement, the dispute or
claim should be submitted to the jurisdiction of a voluntary arbitrator or
panel of arbitrators. It is only in the absence of a collective bargaining
agreement that parties may opt to submit the dispute to either the NLRC or to
voluntary arbitration. It is elementary that rules and regulations issued by
administrative bodies to interpret the law which they are entrusted to enforce,
have the force of law, and are entitled to great respect. 8 Such rules and
regulations partake of the nature of a statute and are just as binding as if
they have been written in the statute itself. 9 In the instant case, the Court
finds no cogent reason to depart from this rule.
The above interpretation of the DOLE, DFA and POEA is also in
consonance with the policy of the state to promote voluntary arbitration as a
mode of settling labor disputes. 10
No less than the Philippine Constitution provides, under the third
paragraph, Section 3, Article XIII, thereof that "[t]he 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."
Consistent with this constitutional provision, Article 211 of the Labor
Code provides the declared policy of the State "[t]o promote and emphasize
the primacy of free collective bargaining and negotiations, including voluntary
arbitration, mediation and conciliation, as modes of settling labor or industrial
disputes."
On the basis of the foregoing, the Court finds no error in the
ruling of the CA that the voluntary arbitrator has jurisdiction over the instant
case.
WHEREFORE, the petition is DENIED. The Decision and
Resolution of the Court of Appeals in CA-G.R. SP No. 76489 dated July 11,
2005 and April 18, 2006, respectively, are AFFIRMED.
SO ORDERED.
SECOND DIVISION
[G.R. No. 162419. July 10, 2007.]
PAUL V. SANTIAGO, petitioner, vs. CF SHARP  CREW  Forewarned is forearmed like his brother when his
MANAGEMENT, INC., respondent.
DECISION
TINGA,  J p:
At the heart of this case involving a contract between a seafarer, on
one hand, and the manning agent and the foreign principal, on the other, is
this erstwhile unsettled legal quandary: whether the seafarer, who was
prevented from leaving the port of Manila and refused deployment without
valid reason but whose POEA-approved employment contract provides that
the employer-employee relationship shall commence only upon the
seafarer's actual departure from the port in the point of hire, is entitled to
relief?
This treats of the petition for review filed by
Paul V. Santiago (petitioner) assailing the Decision and Resolution of the
Court of Appeals dated 16 October 2003 and 19 February 2004, respectively,
in CA-G.R. SP No. 68404. 1
Petitioner had been working as a seafarer for Smith
Bell Management, Inc. (respondent) for about five (5) years. 2 On 3 February
1998, petitioner signed a new contract of employment with respondent, with
the duration of nine (9) months. He was assured of a monthly salary of
US$515.00, overtime pay and other benefits. The following day or on 4
February 1998, the contract was approved by the Philippine Overseas
Employment Administration (POEA). Petitioner was to be deployed on board
the "MSV Seaspread" which was scheduled to leave the port of Manila for
Canada on 13 February 1998.
A week before the scheduled date of departure, Capt. Pacifico
Fernandez, respondent's Vice President, sent a facsimile message to the
captain of "MSV Seaspread," which reads:
I received a phone call today from the wife of
Paul Santiago in Masbate asking me not to send her
husband to MSV Seaspread anymore. Other callers who
did not reveal their identity gave me some feedbacks that
Paul Santiago this time if allowed to depart will jump ship
in Canada like his brother Christopher Santiago, O/S who
jumped ship from the C.S. Nexus in Kita-kyushu, Japan
last December, 1997. CScTED
We do not want this to happen again and have the
vessel penalized like the C.S. Nexus in Japan.
brother when he was applying he behaved like a Saint but
 in his heart he was a serpent. If you agree with me then
we will send his replacement.
Kindly advise. 3
To this message the captain of "MSV Seaspread" replied:
Many thanks for your advice concerning
P. Santiago, A/B. Please cancel plans for him to return to
Seaspread. 4
On 9 February 1998, petitioner was thus told that he would not be
leaving for Canada anymore, but he was reassured that he might be
considered for deployment at some future date.
Petitioner filed a complaint for illegal dismissal, damages, and
attorney's fees against respondent and its foreign principal, Cable and
Wireless (Marine) Ltd. 5 The case was raffled to Labor Arbiter Teresita
Castillon-Lora, who ruled that the employment contract remained valid but
had not commenced since petitioner was not deployed. According to her,
respondent violated the rules and regulations governing overseas
employment when it did not deploy petitioner, causing petitioner to suffer
actual damages representing lost salary income for nine (9) months and fixed
overtime fee, all amounting to US$7,209.00.
The labor arbiter held respondent liable. The dispositive portion of
her Decision dated 29 January 1999 reads:
WHEREFORE, premises considered, respondent
is hereby Ordered to pay complainant actual damages in
the amount of US$7,209.00 plus 10% attorney's fees,
payable in Philippine peso at the rate of exchange
prevailing at the time of payment. TacSAE
All the other claims are hereby DISMISSED for
lack of merit.
SO ORDERED. 6
On appeal by respondent, the National Labor Relations Commission
(NLRC) ruled that there is no employer-employee relationship between
petitioner and respondent because under the Standard Terms and
Conditions Governing the Employment of Filipino Seafarers on Board Ocean
Going Vessels (POEA Standard Contract), the employment contract shall
commence upon actual departure of the seafarer from the airport or seaport
at the point of hire and with a POEA-approved contract. In the absence of an
employer-employee relationship between the parties, the claims for illegal
dismissal, actual damages, and attorney's fees should be dismissed. 7 On
the other hand, the NLRC found respondent's decision not to deploy
petitioner to be a valid exercise of its management prerogative. 8 The NLRC
disposed of the appeal in this wise:
WHEREFORE, in the light of the foregoing, the
assailed Decision dated January 29, 1999 is hereby
AFFIRMED in so far as other claims are concerned and
with MODIFICATION by VACATING the award of actual
damages and attorney's fees as well as excluding Pacifico
Fernandez as party respondent.
SO ORDERED. 9
Petitioner moved for the reconsideration of the NLRC's Decision but
his motion was denied for lack of merit. 10 He elevated the case to the Court
of Appeals through a petition for certiorari.
In its Decision 11 dated 16 October 2003, the Court of Appeals noted
that there is an ambiguity in the NLRC's Decision when it affirmed with
modification the labor arbiter's Decision, because by the very modification
introduced by the Commission (vacating the award of actual damages and
attorney's fees), there is nothing more left in the labor arbiter's Decision to
affirm. 12
According to the appellate court, petitioner is not entitled to actual
damages because damages are not recoverable by a worker who was not
deployed by his agency within the period prescribed in the POEA Rules. 13 It
agreed with the NLRC's finding that petitioner's non-deployment was a valid
exercise of respondent's management prerogative. 14 It added that since
petitioner had not departed from the Port of Manila, no employer-employee
relationship between the parties arose and any claim for damages against
the so-called employer could have no leg to stand on. 15 HaECDI
Petitioner's subsequent motion for reconsideration was denied on 19
February 2004. 16
The present petition is anchored on two grounds, to wit:
A. The Honorable Court of Appeals committed a
serious error of law when it ignored [S]ection 10 of
Republic Act [R.A.] No. 8042 otherwise known as the
Migrant Worker's Act of 1995 as well as Section 29 of
the Standard Terms and Conditions Governing the
Employment of Filipino Seafarers On-Board Ocean-Going
Vessels (which is deemed incorporated under the
petitioner's POEA approved Employment Contract) that
the claims or disputes of the Overseas Filipino Worker by
virtue of a contract fall within the jurisdiction of the Labor
Arbiter of the NLRC.
 B. The Honorable Court of Appeals committed a
serious error when it disregarded the required quantum of
proof in labor cases, which is substantial evidence, thus a
total departure from established jurisprudence on the
matter. 17
Petitioner maintains that respondent violated the Migrant Workers
Act and the POEA Rules when it failed to deploy him within thirty (30)
calendar days without a valid reason. In doing so, it had unilaterally and
arbitrarily prevented the consummation of the POEA-approved contract.
Since it prevented his deployment without valid basis, said deployment being
a condition to the consummation of the POEA contract, the contract is
deemed consummated, and therefore he should be awarded actual
damages, consisting of the stipulated salary and fixed overtime
pay. 18 Petitioner adds that since the contract is deemed consummated, he
should be considered an employee for all intents and purposes, and thus the
labor arbiter and/or the NLRC has jurisdiction to take cognizance of his
claims. 19
Petitioner additionally claims that he should be considered a regular
employee, having worked for five (5) years on board the same vessel owned
by the same principal and manned by the same local agent. He argues that
respondent's act of not deploying him was a scheme designed to prevent him
from attaining the status of a regular employee. 20
Petitioner submits that respondent had no valid and sufficient cause
to abandon the employment contract, as it merely relied upon alleged phone
calls from his wife and other unnamed callers in arriving at the conclusion
that he would jump ship like his brother. He points out that his wife had
executed an affidavit 21 strongly denying having called respondent, and that
the other alleged callers did not even disclose their identities to
respondent. 22 Thus, it was error for the Court of Appeals to adopt the
unfounded conclusion of the NLRC, as the same was not based on
substantial evidence. 23 aHATDI
On the other hand, respondent argues that the Labor Arbiter has no
jurisdiction to award petitioner's monetary claims. His employment with
respondent did not commence because his deployment was withheld for a
valid reason. Consequently, the labor arbiter and/or the NLRC cannot
entertain adjudication of petitioner's case much less award damages to him.
The controversy involves a breach of contractual obligations and as such is
cognizable by civil courts. 24 On another matter, respondent claims that the
second issue posed by petitioner involves a recalibration of facts which is
outside the jurisdiction of this Court. 25
There is some merit in the petition. There is no question that the
parties entered into an employment contract on 3 February 1998, whereby
petitioner was contracted by respondent to render services on board "MSV
Seaspread" for the consideration of US$515.00 per month for nine (9)
months, plus overtime pay. However, respondent failed to deploy petitioner
from the port of Manila to Canada. Considering that petitioner was not able to
depart from the airport or seaport in the point of hire, the employment
contract did not commence, and no employer-employee relationship was
created between the parties. 26
However, a distinction must be made between the perfection of the
employment contract and the commencement of the employer-employee
relationship. The perfection of the contract, which in this case coincided with
the date of execution thereof, occurred when petitioner and respondent
agreed on the object and the cause, as well as the rest of the terms and
conditions therein. The commencement of the employer-employee
relationship, as earlier discussed, would have taken place had petitioner
been actually deployed from the point of hire. Thus, even before the start of
any employer-employee relationship, contemporaneous with the perfection of
the employment contract was the birth of certain rights and obligations, the
breach of which may give rise to a cause of action against the erring party.
Thus, if the reverse had happened, that is the seafarer failed or refused to be
deployed as agreed upon, he would be liable for damages.
Moreover, while the POEA Standard Contract must be recognized
and respected, neither the manning agent nor the employer can simply
prevent a seafarer from being deployed without a valid reason.
Respondent's act of preventing petitioner from departing the port of
Manila and boarding "MSV Seaspread" constitutes a breach of contract,
giving rise to petitioner's cause of action. Respondent unilaterally and
unreasonably reneged on its obligation to deploy petitioner and must
therefore answer for the actual damages he suffered.
We take exception to the Court of Appeals' conclusion that damages
are not recoverable by a worker who was not deployed by his agency. The
fact that the POEA Rules 27 are silent as to the payment of damages to the
affected seafarer does not mean that the seafarer is precluded from claiming
the same. The sanctions provided for non-deployment do not end with the
suspension or cancellation of license or fine and the return of all documents
at no cost to the worker. They do not forfend a seafarer from instituting an
action for damages against the employer or agency which has failed to
deploy him. HaIESC
The POEA Rules only provide sanctions which the POEA can
impose on erring agencies. It does not provide for damages and money
claims recoverable by aggrieved employees because it is not the POEA, but
the NLRC, which has jurisdiction over such matters.
Despite the absence of an employer-employee relationship between
petitioner and respondent, the Court rules that the NLRC has jurisdiction over
petitioner's complaint. The jurisdiction of labor arbiters is not limited to claims
arising from employer-employee relationships. Section 10 of R.A. No.
8042 (Migrant Workers Act), provides that:
Sec. 10. Money Claims. — Notwithstanding any
provision of law to the contrary, the Labor Arbiters of the
National Labor Relations Commission (NLRC) shall have
the original and exclusive jurisdiction to hear and decide,
within ninety (90) calendar days after the filing of the
complaint, the claims arising out of an employer-employee
relationship or by virtue of any law or contract
involving Filipino workers for overseas deployment
including claims for actual, moral, exemplary and
other forms of damages. . . . [Emphasis supplied]
Since the present petition involves the employment contract entered
into by petitioner for overseas employment, his claims are cognizable by the
labor arbiters of the NLRC.
Article 2199 of the Civil Code provides that one is entitled to an
adequate compensation only for such pecuniary loss suffered by him as he
has duly proved. Respondent is thus liable to pay petitioner actual damages
in the form of the loss of nine (9) months' worth of salary as provided in the
contract. He is not, however, entitled to overtime pay. While the contract
indicated a fixed overtime pay, it is not a guarantee that he would receive
said amount regardless of whether or not he rendered overtime work. Even
though petitioner was "prevented without valid reason from rendering regular
much less overtime service," 28 the fact remains that there is no certainty
that petitioner will perform overtime work had he been allowed to board the
vessel. The amount of US$286.00 stipulated in the contract will be paid only
if and when the employee rendered overtime work. This has been the tenor
of our rulings in the case of Stolt-Nielsen Marine Services (Phils.), Inc.  v.
National Labor Relations Commission 29 where we discussed the matter in
this light: AaCTcI
The contract provision means that the fixed overtime
pay of 30% would be the basis for computing the overtime pay if
and when overtime work would be rendered. Simply stated, the
rendition of overtime work and the submission of sufficient proof
that said work was actually performed are conditions to be
satisfied before a seaman could be entitled to overtime pay which
should be computed on the basis of 30% of the basic monthly
salary. In short, the contract provision guarantees the right to
overtime pay but the entitlement to such benefit must first be
established. Realistically speaking, a seaman, by the very nature
of his job, stays on board a ship or vessel beyond the regular
eight-hour work schedule. For the employer to give him overtime
pay for the extra hours when he might be sleeping or attending to
his personal chores or even just lulling away his time would be
extremely unfair and unreasonable. 30
The Court also holds that petitioner is entitled to attorney's fees in
the concept of damages and expenses of litigation. Attorney's fees are
recoverable when the defendant's act or omission has compelled the plaintiff
to incur expenses to protect his interest. 31 We note that respondent's basis
for not deploying petitioner is the belief that he will jump ship just like his
brother, a mere suspicion that is based on alleged phone calls of several
persons whose identities were not even confirmed. Time and again, this
Court has upheld management prerogatives so long as they are exercised in
good faith for the advancement of the employer's interest and not for the
purpose of defeating or circumventing the rights of the employees under
special laws or under valid agreements. 32 Respondent's failure to deploy
petitioner is unfounded and unreasonable, forcing petitioner to institute the
suit below. The award of attorney's fees is thus warranted.
However, moral damages cannot be awarded in this case. While
respondent's failure to deploy petitioner seems baseless and unreasonable,
we cannot qualify such action as being tainted with bad faith, or done
deliberately to defeat petitioner's rights, as to justify the award of moral
damages. At most, respondent was being overzealous in protecting its
interest when it became too hasty in making its conclusion that petitioner will
jump ship like his brother.
We likewise do not see respondent's failure to deploy petitioner as
an act designed to prevent the latter from attaining the status of a regular
employee. Even if petitioner was able to depart the port of Manila, he still
cannot be considered a regular employee, regardless of his previous
contracts of employment with respondent. In  Millares  v. National Labor
Relations Commission, 33 the Court ruled that seafarers are considered
contractual employees and cannot be considered as regular employees
under the Labor Code. Their employment is governed by the contracts they
sign every time they are rehired and their employment is terminated when
the contract expires. The exigencies of their work necessitates that they be
employed on a contractual basis. 34 CDTHSI
WHEREFORE, petition is GRANTED IN PART. The Decision dated
16 October 2003 and the Resolution dated 19 February 2004 of the Court of
Appeals are REVERSED and SET ASIDE. The Decision of Labor Arbiter
Teresita D. Castillon-Lora dated 29 January 1999 is REINSTATED with the
MODIFICATION that respondent CF Sharp Crew Management, Inc. is
ordered to pay actual or compensatory damages in the amount of
US$4,635.00 representing salary for nine (9) months as stated in the
contract, and attorney's fees at the reasonable rate of 10% of the recoverable
amount.
SO ORDERED.
[G.R. No. 170139. August 5, 2014.]
 SAMEER OVERSEAS PLACEMENT AGENCY,
INC.,  petitioner, vs. JOY C. CABILES,  respondent.
DECISION
LEONEN, J  p:
This case involves an overseas Filipino worker with shattered
dreams. It is our duty, given the facts and the law, to approximate justice for
her.
We are asked to decide a petition for review 1 on certiorari assailing
the Court of Appeals' decision 2 dated June 27, 2005. This decision partially
affirmed the National Labor Relations Commission's resolution dated March
31, 2004, 3 declaring respondent's dismissal illegal, directing petitioner to
pay respondent's three-month salary equivalent to New Taiwan Dollar (NT$)
46,080.00, and ordering it to reimburse the NT$3,000.00 withheld from
respondent, and pay her NT$300.00 attorney's fees. 4
Petitioner, Sameer Overseas Placement Agency, Inc., is a
recruitment and placement agency. 5 Responding to an ad it published,
respondent, Joy C. Cabiles, submitted her application for a quality control job
in Taiwan. 6
Joy's application was accepted. 7 Joy was later asked to sign a one-
year employment contract for a monthly salary of NT$15,360.00. 8 She
alleged that Sameer Overseas Agency required her to pay a placement fee
of PhP70,000.00 when she signed the employment contract. 9 cIADTC
Joy was deployed to work for Taiwan Wacoal, Co. Ltd. (Wacoal) on
June 26, 1997. 10 She alleged that in her employment contract, she agreed
to work as quality control for one year. 11 In Taiwan, she was asked to work
as a cutter. 12
Sameer Overseas Placement Agency claims that on July 14, 1997, a
certain Mr. Huwang from Wacoal informed Joy, without prior notice, that she
was terminated and that "she should immediately report to their office to get
her salary and passport." 13 She was asked to "prepare for immediate
repatriation." 14
Joy claims that she was told that from June 26 to July 14, 1997, she
only earned a total of NT$9,000. 15 According to her, Wacoal deducted
NT$3,000 to cover her plane ticket to Manila. 16 aATESD
On October 15, 1997, Joy filed a complaint 17 with the National
Labor Relations Commission against petitioner and Wacoal. She claimed
that she was illegally dismissed. 18 She asked for the return of her
placement fee, the withheld amount for repatriation costs, payment of her
salary for 23 months as well as moral and exemplary damages. 19 She
identified Wacoal as Sameer Overseas Placement Agency's foreign
principal. 20
Sameer Overseas Placement Agency alleged that respondent's
termination was due to her inefficiency, negligence in her duties, and her
"failure to comply with the work requirements [of] her foreign
[employer]". 21 The agency also claimed that it did not ask for a placement
fee of PhP70,000.00. 22 As evidence, it showed Official Receipt No. 14860
dated June 10, 1997, bearing the amount of PhP20,360.00. 23 Petitioner
added that Wacoal's accreditation with petitioner had already been
transferred to the Pacific Manpower & Management Services, Inc. (Pacific)
as of August 6, 1997. 24 Thus, petitioner asserts that it was already
substituted by Pacific Manpower. 25
Pacific Manpower moved for the dismissal of petitioner's claims
against it. 26 It alleged that there was no employer-employee relationship
between them. 27 Therefore, the claims against it were outside the
jurisdiction of the Labor Arbiter. 28 Pacific Manpower argued that the
employment contract should first be presented so that the employer's
contractual obligations might be identified. 29 It further denied that it
assumed liability for petitioner's illegal acts. 30
On July 29, 1998, the Labor Arbiter dismissed Joy's
complaint. 31 Acting Executive Labor Arbiter Pedro C. Ramos ruled that her
complaint was based on mere allegations. 32 The Labor Arbiter found that
there was no excess payment of placement fees, based on the official receipt
presented by petitioner. 33 The Labor Arbiter found unnecessary a
discussion on petitioner's transfer of obligations to Pacific 34 and considered
the matter immaterial in view of the dismissal of respondent's
complaint. 35 IcADSE
Joy appealed 36 to the National Labor Relations Commission.
In a resolution 37 dated March 31, 2004, the National Labor
Relations Commission declared that Joy was illegally dismissed. 38 It
reiterated the doctrine that the burden of proof to show that the dismissal was
based on a just or valid cause belongs to the employer. 39 It found that
Sameer Overseas Placement Agency failed to prove that there were just
causes for termination. 40 There was no sufficient proof to show that
respondent was inefficient in her work and that she failed to comply with
company requirements. 41 Furthermore, procedural due process was not
observed in terminating respondent. 42
 The National Labor Relations Commission did not rule on the issue
of reimbursement of placement fees for lack of jurisdiction. 43 It refused to
entertain the issue of the alleged transfer of obligations to Pacific. 44 It did
not acquire jurisdiction over that issue because Sameer Overseas Placement
Agency failed to appeal the Labor Arbiter's decision not to rule on the
matter. 45
The National Labor Relations Commission awarded respondent only
three (3) months worth of salary in the amount of NT$46,080, the
reimbursement of the NT$3,000 withheld from her, and attorney's fees of
NT$300. 46
The Commission denied the agency's motion for
reconsideration 47 dated May 12, 2004 through a resolution 48 dated July 2,
2004.
Aggrieved by the ruling, Sameer Overseas Placement Agency
caused the filing of a petition 49 for certiorari with the Court of Appeals
assailing the National Labor Relations Commission's resolutions dated March
31, 2004 and July 2, 2004.
The Court of Appeals 50 affirmed the decision of the National Labor
Relations Commission with respect to the finding of illegal dismissal, Joy's
entitlement to the equivalent of three months worth of salary, reimbursement
of withheld repatriation expense, and attorney's fees. 51 The Court of
Appeals remanded the case to the National Labor Relations Commission to
address the validity of petitioner's allegations against Pacific. 52 The Court of
Appeals held, thus: IECcaA
Although the public respondent found the
dismissal of the complainant-respondent illegal, we should
point out that the NLRC merely awarded her three (3)
months backwages or the amount of NT$46,080.00, which
was based upon its finding that she was dismissed without
due process, a finding that we uphold, given petitioner's
lack of worthwhile discussion upon the same in the
proceedings below or before us. Likewise we sustain
NLRC's finding in regard to the reimbursement of her fare,
which is squarely based on the law; as well as the award
of attorney's fees.
But we do find it necessary to remand the instant
case to the public respondent for further proceedings, for
the purpose of addressing the validity or propriety of
petitioner's third-party complaint against the transferee
agent or the Pacific Manpower & Management Services,
Inc. and Lea G. Manabat. We should emphasize that as
far as the decision of the NLRC on the claims of Joy
Cabiles, is concerned, the same is hereby affirmed with
finality, and we hold petitioner liable thereon, but without
prejudice to further hearings on its third party complaint
against Pacific for reimbursement.
WHEREFORE, premises considered, the assailed
Resolutions are hereby partly AFFIRMED in accordance
with the foregoing discussion, but subject to the caveat
embodied in the last sentence. No costs.
SO ORDERED. 53
Dissatisfied, Sameer Overseas Placement Agency filed this
petition. 54
We are asked to determine whether the Court of Appeals erred when
it affirmed the ruling of the National Labor Relations Commission finding
respondent illegally dismissed and awarding her three months' worth of
salary, the reimbursement of the cost of her repatriation, and attorney's fees
despite the alleged existence of just causes of termination. SHIcDT
Petitioner reiterates that there was just cause for termination
because there was a finding of Wacoal that respondent was inefficient in her
work. 55 Therefore, it claims that respondent's dismissal was valid. 56
Petitioner also reiterates that since Wacoal's accreditation was
validly transferred to Pacific at the time respondent filed her complaint, it
should be Pacific that should now assume responsibility for Wacoal's
contractual obligations to the workers originally recruited by petitioner. 57
Sameer Overseas Placement Agency's petition is without merit. We
find for respondent.
I
Sameer Overseas Placement Agency failed to show that there was
just cause for causing Joy's dismissal. The employer, Wacoal, also failed to
accord her due process of law. ISCaTE
Indeed, employers have the prerogative to impose productivity and
quality standards at work. 58 They may also impose reasonable rules to
ensure that the employees comply with these standards. 59 Failure to
comply may be a just cause for their dismissal. 60 Certainly, employers
cannot be compelled to retain the services of an employee who is guilty of
acts that are inimical to the interest of the employer. 61 While the law
acknowledges the plight and vulnerability of workers, it does not "authorize
the oppression or self-destruction of the employer". 62 Management
prerogative is recognized in law and in our jurisprudence.
This prerogative, however, should not be abused. It is "tempered
with the employee's right to security of tenure." 63 Workers are entitled to
substantive and procedural due process before termination. They may not be
removed from employment without a valid or just cause as determined by law
and without going through the proper procedure.
Security of tenure for labor is guaranteed by our Constitution. 64
Employees are not stripped of their security of tenure when they
move to work in a different jurisdiction. With respect to the rights of overseas
Filipino workers, we follow the principle of lex loci contractus.
Thus, in Triple Eight Integrated Services, Inc. v. NLRC, 65 this court
noted:
Petitioner likewise attempts to sidestep the
medical certificate requirement by contending that since
Osdana was working in Saudi Arabia, her employment
was subject to the laws of the host country. Apparently,
petitioner hopes to make it appear that the labor laws of
Saudi Arabia do not require any certification by a
competent public health authority in the dismissal of
employees due to illness. DIEcHa
Again, petitioner's argument is without merit.
First, established is the rule that lex loci
contractus (the law of the place where the contract is
made) governs in this jurisdiction. There is no
question that the contract of employment in this case
was perfected here in the Philippines. Therefore, the
Labor Code, its implementing rules and regulations,
and other laws affecting labor apply in this case.
Furthermore, settled is the rule that the courts of the forum
will not enforce any foreign claim obnoxious to the forum's
public policy. Here in the Philippines, employment
agreements are more than contractual in nature.
The Constitution itself, in Article XIII, Section 3, guarantees
the special protection of workers, to wit:
The State shall afford full protection to
labor, local and overseas, organized and
unorganized, and promote full employment and
equality of employment opportunities for all.
It shall guarantee the rights of all workers
to self-organization, collective bargaining and
negotiations, and peaceful concerted activities,
including the right to strike in accordance with law.
They shall be entitled to security of tenure,
humane conditions of work, and a living wage.
They shall also participate in policy and decision-
making processes affecting their rights and
benefits as may be provided by law.
xxx xxx xxx
This public policy should be borne in mind in this
case because to allow foreign employers to determine for
and by themselves whether an overseas contract worker
may be dismissed on the ground of illness would
encourage illegal or arbitrary pre-termination of
employment contracts. 66 (Emphasis supplied, citation
omitted) HATEDC
Even with respect to fundamental procedural rights, this court
emphasized in PCL Shipping Philippines, Inc. v. NLRC, 67 to wit:
Petitioners admit that they did not inform private
respondent in writing of the charges against him and that
they failed to conduct a formal investigation to give him
opportunity to air his side.  However, petitioners contend
that the twin requirements of notice and hearing applies
strictly only when the employment is within the Philippines
and that these need not be strictly observed in cases of
international maritime or overseas employment.
The Court does not agree. The provisions of
the  Constitution as well as the Labor Code which
afford protection to labor apply to Filipino employees
whether working within the Philippines or abroad.
Moreover, the principle of lex loci contractus (the law
of the place where the contract is made) governs in
this jurisdiction. In the present case, it is not disputed
that the Contract of Employment entered into by and
between petitioners and private respondent was executed
here in the Philippines with the approval of the Philippine
Overseas Employment Administration (POEA). Hence, the
Labor Code together with its implementing rules and
regulations and other laws affecting labor apply in this
case. 68 (Emphasis supplied, citations omitted)
By our laws, overseas Filipino workers (OFWs) may only be
terminated for a just or authorized cause and after compliance with
procedural due process requirements.
Article 282 of the Labor Code enumerates the just causes of
termination by the employer. Thus: CaAcSE
 Art. 282. Termination by employer. — An
employer may terminate an employment for any of the
following causes:
(a) Serious misconduct or willful disobedience by
the employee of the lawful orders of his employer or
representative in connection with his work;
(b) Gross and habitual neglect by the employee of
his duties;
(c) Fraud or willful breach by the employee of the
trust reposed in him by his employer or duly authorized
representative;
(d) Commission of a crime or offense by the
employee against the person of his employer or any
immediate member of his family or his duly authorized
representatives; and
(e) Other causes analogous to the foregoing.
Petitioner's allegation that respondent was inefficient in her work and
negligent in her duties 69 may, therefore, constitute a just cause for
termination under Article 282 (b), but only if petitioner was able to prove it.
The burden of proving that there is just cause for termination is on
the employer. "The employer must affirmatively show rationally adequate
evidence that the dismissal was for a justifiable cause." 70 Failure to show
that there was valid or just cause for termination would necessarily mean that
the dismissal was illegal. 71
To show that dismissal resulting from inefficiency in work is valid, it
must be shown that: 1) the employer has set standards of conduct and
workmanship against which the employee will be judged; 2) the standards of
conduct and workmanship must have been communicated to the employee;
and 3) the communication was made at a reasonable time prior to the
employee's performance assessment. ISDHEa
This is similar to the law and jurisprudence on probationary
employees, which allow termination of the employee only when there is "just
cause or when [the probationary employee] fails to qualify as a regular
employee in accordance with reasonable standards made known by the
employer to the employee at the time of his [or her] engagement." 72
However, we do not see why the application of that ruling should be
limited to probationary employment. That rule is basic to the idea of security
of tenure and due process, which are guaranteed to all employees, whether
their employment is probationary or regular.
The pre-determined standards that the employer sets are the bases
for determining the probationary employee's fitness, propriety, efficiency, and
qualifications as a regular employee. Due process requires that the
probationary employee be informed of such standards at the time of his or
her engagement so he or she can adjust his or her character or workmanship
accordingly. Proper adjustment to fit the standards upon which the
employee's qualifications will be evaluated will increase one's chances of
being positively assessed for regularization by his or her employer.
Assessing an employee's work performance does not stop after
regularization. The employer, on a regular basis, determines if an employee
is still qualified and efficient, based on work standards. Based on that
determination, and after complying with the due process requirements of
notice and hearing, the employer may exercise its management prerogative
of terminating the employee found unqualified.
The regular employee must constantly attempt to prove to his or her
employer that he or she meets all the standards for employment. This time,
however, the standards to be met are set for the purpose of retaining
employment or promotion. The employee cannot be expected to meet any
standard of character or workmanship if such standards were not
communicated to him or her. Courts should remain vigilant on allegations of
the employer's failure to communicate work standards that would govern
one's employment "if [these are] to discharge in good faith [their] duty to
adjudicate". 73 EHcaAI
In this case, petitioner merely alleged that respondent failed to
comply with her foreign employer's work requirements and was inefficient in
her work. 74 No evidence was shown to support such allegations. Petitioner
did not even bother to specify what requirements were not met, what
efficiency standards were violated, or what particular acts of respondent
constituted inefficiency.
There was also no showing that respondent was sufficiently
informed of the standards against which her work efficiency and performance
were judged.  The parties' conflict as to the position held by respondent
showed that even the matter as basic as the job title was not clear.
The bare allegations of petitioner are not sufficient to support a claim
that there is just cause for termination. There is no proof that respondent was
legally terminated.
Petitioner failed to comply with
the due process requirements
Respondent's dismissal less than one year from hiring and her
repatriation on the same day show not only failure on the part of petitioner to
comply with the requirement of the existence of just cause for termination.
They patently show that the employers did not comply with the due process
requirement.
A valid dismissal requires both a valid cause and adherence to the
valid procedure of dismissal. 75 The employer is required to give the charged
employee at least two written notices before termination. 76 One of the
written notices must inform the employee of the particular acts that may
cause his or her dismissal. 77 The other notice must "[inform] the employee
of the employer's decision". 78 Aside from the notice requirement, the
employee must also be given "an opportunity to be heard." 79
Petitioner failed to comply with the twin notices and hearing
requirements. Respondent started working on June 26, 1997. She was told
that she was terminated on July 14, 1997 effective on the same day and
barely a month from her first workday. She was also repatriated on the same
day that she was informed of her termination. The abruptness of the
termination negated any finding that she was properly notified and given the
opportunity to be heard. Her constitutional right to due process of law was
violated. cITCAa
II
Respondent Joy Cabiles, having been illegally dismissed, is entitled
to her salary for the unexpired portion of the employment contract that was
violated together with attorney's fees and reimbursement of amounts
withheld from her salary.
Section 10 of Republic Act No. 8042, otherwise known as
the Migrant Workers and Overseas Filipinos Act of 1995, states that
overseas workers who were terminated without just, valid, or authorized
cause "shall be entitled to the full reimbursement of his placement fee with
interest of twelve (12%) per annum, plus his salaries for the unexpired
portion of his employment contract or for three (3) months for every year of
the unexpired term, whichever is less."
Sec. 10. MONEY CLAIMS. — Notwithstanding any
provision of law to the contrary, the Labor Arbiters of the
National Labor Relations Commission (NLRC) shall have
the original and exclusive jurisdiction to hear and decide,
within ninety (90) calendar days after filing of the
complaint, the claims arising out of an employer-employee
relationship or by virtue of any law or contract involving
Filipino workers for overseas deployment including claims
for actual, moral, exemplary and other forms of damages.
The liability of the principal/employer and the
recruitment/placement agency for any and all claims under
this section shall be joint and several. This
provisions [sic] shall be incorporated in the contract for
overseas employment and shall be a condition precedent
for its approval. The performance bond to be filed by the
recruitment/placement agency, as provided by law, shall
be answerable for all money claims or damages that may
be awarded to the workers. If the recruitment/placement
agency is a juridical being, the corporate officers and
directors and partners as the case may be, shall
themselves be jointly and solidarily liable with the
corporation or partnership for the aforesaid claims and
damages.
Such liabilities shall continue during the entire
period or duration of the employment contract and shall
not be affected by any substitution, amendment or
modification made locally or in a foreign country of the said
contract. DcITaC
Any compromise/amicable settlement or voluntary
agreement on money claims inclusive of damages under
this section shall be paid within four (4) months from the
approval of the settlement by the appropriate authority.
In case of termination of overseas employment
without just, valid or authorized cause as defined by law or
contract, the workers shall be entitled to the full
reimbursement of his placement fee with interest of twelve
(12%) per annum, plus his salaries for the unexpired
portion of his employment contract or for three (3) months
for every year of the unexpired term, whichever is less.
xxx xxx xxx
(Emphasis supplied)
Section 15 of Republic Act No. 8042 states that "repatriation of the
worker and the transport of his [or her] personal belongings shall be the
primary responsibility of the agency which recruited or deployed the worker
overseas". The exception is when "termination of employment is due solely
to the fault of the worker," 80 which as we have established, is not the case.
It reads: DSETac
SEC. 15. REPATRIATION OF WORKERS;
EMERGENCY REPATRIATION FUND. — The repatriation
of the worker and the transport of his personal belongings
shall be the primary responsibility of the agency which
recruited or deployed the worker overseas. All costs
attendant to repatriation shall be borne by or charged to
the agency concerned and/or its principal. Likewise, the
repatriation of remains and transport of the personal
 belongings of a deceased worker and all costs attendant
thereto shall be borne by the principal and/or local agency.
However, in cases where the termination of employment is
due solely to the fault of the worker, the principal/employer
or agency shall not in any manner be responsible for the
repatriation of the former and/or his belongings.
xxx xxx xxx
The Labor Code 81 also entitles the employee to 10% of the amount
of withheld wages as attorney's fees when the withholding is
unlawful. IcEaST
The Court of Appeals affirmed the National Labor Relations
Commission's decision to award respondent NT$46,080.00 or the three-
month equivalent of her salary, attorney's fees of NT$300.00, and the
reimbursement of the withheld NT$3,000.00 salary, which answered for her
repatriation.
We uphold the finding that respondent is entitled to all of these
awards. The award of the three-month equivalent of respondent's salary
should, however, be increased to the amount equivalent to the
unexpired term of the employment contract.
In Serrano v. Gallant Maritime Services, Inc. and Marlow Navigation
Co., Inc., 82 this court ruled that the clause "or for three (3) months for every
year of the unexpired term, whichever is less" 83 is unconstitutional for
violating the equal protection clause and substantive due process. 84
A statute or provision which was declared unconstitutional is not a
law. It "confers no rights; it imposes no duties; it affords no protection; it
creates no office; it is inoperative as if it has not been passed at all." 85
We are aware that the clause "or for three (3) months for every year
of the unexpired term, whichever is less" was reinstated in Republic Act No.
8042 upon promulgation of Republic Act No. 10022 in 2010. Section 7
of Republic Act No. 10022 provides:
Section 7. Section 10 of Republic Act No. 8042,
as amended, is hereby amended to read as
follows: CcSTHI
SEC. 10. Money Claims. —
Notwithstanding any provision of law to the
contrary, the Labor Arbiters of the National Labor
Relations Commission (NLRC) shall have the
original and exclusive jurisdiction to hear and
decide, within ninety (90) calendar days after the
filing of the complaint, the claims arising out of an
employer-employee relationship or by virtue of any
law or contract involving Filipino workers for
overseas deployment including claims for actual,
moral, exemplary and other forms of damage.
Consistent with this mandate, the NLRC shall
endeavor to update and keep abreast with the
developments in the global services industry.
The liability of the principal/employer and
the recruitment/placement agency for any and all
claims under this section shall be joint and
several. This provision shall be incorporated in the
contract for overseas employment and shall be a
condition precedent for its approval. The
performance bond to de [sic] filed by the
recruitment/placement agency, as provided by
law, shall be answerable for all money claims or
damages that may be awarded to the workers. If
the recruitment/placement agency is a juridical
being, the corporate officers and directors and
partners as the case may be, shall themselves be
jointly and solidarily liable with the corporation or
partnership for the aforesaid claims and
damages. CAHTIS
Such liabilities shall continue during the
entire period or duration of the employment
contract and shall not be affected by any
substitution, amendment or modification made
locally or in a foreign country of the said contract.
Any compromise/amicable settlement or
voluntary agreement on money claims inclusive of
damages under this section shall be paid within
thirty (30) days from approval of the settlement by
the appropriate authority.
In case of termination of overseas
employment without just, valid or authorized cause
as defined by law or contract, or any unauthorized
deductions from the migrant worker's salary, the
worker shall be entitled to the full reimbursement
if [sic] his placement fee and the deductions made
with interest at twelve percent (12%) per annum,
plus his salaries for the unexpired portion of his
employment contract or for three (3) months for
every year of the unexpired term, whichever is
less.
 In case of a final and executory judgement
against a foreign employer/principal, it shall be
automatically disqualified, without further
proceedings, from participating in the Philippine
Overseas Employment Program and from
recruiting and hiring Filipino workers until and
unless it fully satisfies the judgement award.
Noncompliance with the mandatory
periods for resolutions of case provided under this
section shall subject the responsible officials to
any or all of the following penalties:
(a) The salary of any such official who fails
to render his decision or resolution within the
prescribed period shall be, or caused to be,
withheld until the said official complies therewith;
(b) Suspension for not more than ninety
(90) days; or
(c) Dismissal from the service with
disqualification to hold any appointive public office
for five (5) years.
Provided, however, That the penalties
herein provided shall be without prejudice to any
liability which any such official may have
incured [sic] under other existing laws or rules and
regulations as a consequence of violating the
provisions of this paragraph. (Emphasis
supplied) HSIDTE
Republic Act No. 10022 was promulgated on March 8, 2010. This
means that the reinstatement of the clause in Republic Act No. 8042 was not
yet in effect at the time of respondent's termination from work in
1997. 86 Republic Act No. 8042 before it was amended by Republic Act No.
10022 governs this case.
When a law is passed, this court awaits an actual case that clearly
raises adversarial positions in their proper context before considering a
prayer to declare it as unconstitutional.
However, we are confronted with a unique situation. The law passed
incorporates the exact clause already declared as unconstitutional, without
any perceived substantial change in the circumstances.
This may cause confusion on the part of the National Labor
Relations Commission and the Court of Appeals. At minimum, the existence
of Republic Act No. 10022 may delay the execution of the judgment in this
case, further frustrating remedies to assuage the wrong done to petitioner.
Hence, there is a necessity to decide this constitutional issue. ACSaHc
Moreover, this court is possessed with the constitutional duty to
"[p]romulgate rules concerning the protection and enforcement of
constitutional rights". 87 When cases become moot and academic, we do not
hesitate to provide for guidance to bench and bar in situations where the
same violations are capable of repetition but will evade review. This is
analogous to cases where there are millions of Filipinos working abroad who
are bound to suffer from the lack of protection because of the restoration of
an identical clause in a provision previously declared as unconstitutional.
In the hierarchy of laws, the Constitution is supreme. No branch or
office of the government may exercise its powers in any manner inconsistent
with the Constitution, regardless of the existence of any law that supports
such exercise. The Constitution cannot be trumped by any other law. All laws
must be read in light of the Constitution. Any law that is inconsistent with it is
a nullity.
Thus, when a law or a provision of law is null because it is
inconsistent with the Constitution, the nullity cannot be cured by
reincorporation or reenactment of the same or a similar law or provision. A
law or provision of law that was already declared unconstitutional remains as
such unless circumstances have so changed as to warrant a reverse
conclusion.
We are not convinced by the pleadings submitted by the parties that
the situation has so changed so as to cause us to reverse binding precedent.
Likewise, there are special reasons of judicial efficiency and
economy that attend to these cases.
The new law puts our overseas workers in the same vulnerable
position as they were prior to Serrano. Failure to reiterate the very ratio
decidendi of that case will result in the same untold economic hardships that
our reading of the Constitution intended to avoid. Obviously, we cannot
countenance added expenses for further litigation that will reduce their hard-
earned wages as well as add to the indignity of having been deprived of the
protection of our laws simply because our precedents have not been
followed. There is no constitutional doctrine that causes injustice in the face
of empty procedural niceties. Constitutional interpretation is complex, but it is
never unreasonable.
Thus, in a resolution 88 dated October 22, 2013, we ordered the
parties and the Office of the Solicitor General to comment on the
constitutionality of the reinstated clause in Republic Act No. 10022. acEHCD
In its comment, 89 petitioner argued that the clause was
constitutional. 90 The legislators intended a balance between the employers'
and the employees' rights by not unduly burdening the local recruitment
agency. 91 Petitioner is also of the view that the clause was already declared
as constitutional in Serrano. 92
The Office of the Solicitor General also argued that the clause was
valid and constitutional. 93 However, since the parties never raised the issue
of the constitutionality of the clause as reinstated in Republic Act No. 10022,
its contention is that it is beyond judicial review. 94
On the other hand, respondent argued that the clause was
unconstitutional because it infringed on workers' right to contract. 95
We observe that the reinstated clause, this time as provided
in Republic Act No. 10022, violates the constitutional rights to equal
protection and due process. 96 Petitioner as well as the Solicitor General
have failed to show any compelling change in the circumstances that would
warrant us to revisit the precedent.
We reiterate our finding in Serrano v. Gallant Maritime that
limiting wages that should be recovered by an illegally dismissed
overseas worker to three months is both a violation of due process and
the equal protection clauses of the  Constitution.
Equal protection of the law is a guarantee that persons under like
circumstances and falling within the same class are treated alike, in terms of
"privileges conferred and liabilities enforced." 97 It is a guarantee against
"undue favor and individual or class privilege, as well as hostile
discrimination or the oppression of inequality." 98 aCTHEA
In creating laws, the legislature has the power "to make distinctions
and classifications." 99 In exercising such power, it has a wide
discretion. 100
The equal protection clause does not infringe on this legislative
power. 101 A law is void on this basis, only if classifications are made
arbitrarily. 102 There is no violation of the equal protection clause if the law
applies equally to persons within the same class and if there are reasonable
grounds for distinguishing between those falling within the class and those
who do not fall within the class. 103 A law that does not violate the equal
protection clause prescribes a reasonable classification. 104
A reasonable classification "(1) must rest on substantial distinctions;
(2) must be germane to the purposes of the law; (3) must not be limited to
existing conditions only; and (4) must apply equally to all members of the
same class." 105
The reinstated clause does not satisfy the requirement of reasonable
classification.
In Serrano, we identified the classifications made by the reinstated
clause. It distinguished between fixed-period overseas workers and fixed-
period local workers. 106 It also distinguished between overseas workers
with employment contracts of less than one year and overseas workers with
employment contracts of at least one year. 107 Within the class of overseas
workers with at least one-year employment contracts, there was a distinction
between those with at least a year left in their contracts and those with less
than a year left in their contracts when they were illegally
dismissed. 108 aTHASC
The Congress' classification may be subjected to judicial review.
In Serrano, there is a "legislative classification which impermissibly interferes
with the exercise of a fundamental right or operates to the peculiar
disadvantage of a suspect class." 109
Under the Constitution, labor is afforded special
protection. 110 Thus, this court in Serrano, "[i]mbued with the same sense of
'obligation to afford protection to labor,' . . . employ[ed] the standard of strict
judicial scrutiny, for it perceive[d] in the subject clause a suspect
classification prejudicial to OFWs." 111
We also noted in Serrano that before the passage of Republic Act
No. 8042, the money claims of illegally terminated overseas and local
workers with fixed-term employment were computed in the same
manner. 112 Their money claims were computed based on the "unexpired
portions of their contracts." 113 The adoption of the reinstated clause
in Republic Act No. 8042 subjected the money claims of illegally dismissed
overseas workers with an unexpired term of at least a year to a cap of three
months worth of their salary. 114 There was no such limitation on the money
claims of illegally terminated local workers with fixed-term employment. 115
We observed that illegally dismissed overseas workers whose
employment contracts had a term of less than one year were granted the
amount equivalent to the unexpired portion of their employment
contracts. 116 Meanwhile, illegally dismissed overseas workers with
employment terms of at least a year were granted a cap equivalent to three
months of their salary for the unexpired portions of their contracts. 117
Observing the terminologies used in the clause, we also found that
"the subject clause creates a sub-layer of discrimination among OFWs
whose contract periods are for more than one year: those who are illegally
dismissed with less than one year left in their contracts shall be entitled to
their salaries for the entire unexpired portion thereof, while those who are
illegally dismissed with one year or more remaining in their contracts shall be
covered by the reinstated clause, and their monetary benefits limited to their
salaries for three months only." 118 ATHCDa
We do not need strict scrutiny to conclude that these classifications
do not rest on any real or substantial distinctions that would justify different
treatments in terms of the computation of money claims resulting from illegal
termination.
Overseas workers regardless of their classifications are entitled to
security of tenure, at least for the period agreed upon in their contracts. This
means that they cannot be dismissed before the end of their contract terms
without due process. If they were illegally dismissed, the workers' right to
security of tenure is violated.
The rights violated when, say, a fixed-period local worker is illegally
terminated are neither greater than nor less than the rights violated when a
fixed-period overseas worker is illegally terminated. It is state policy to
protect the rights of workers without qualification as to the place of
employment. 119 In both cases, the workers are deprived of their expected
salary, which they could have earned had they not been illegally dismissed.
For both workers, this deprivation translates to economic insecurity and
disparity. 120 The same is true for the distinctions between overseas workers
with an employment contract of less than one year and overseas workers
with at least one year of employment contract, and between overseas
workers with at least a year left in their contracts and overseas workers with
less than a year left in their contracts when they were illegally dismissed.
For this reason, we cannot subscribe to the argument that "[overseas
workers] are contractual employees who can never acquire regular
employment status, unlike local workers" 121 because it already justifies
differentiated treatment in terms of the computation of money claims. 122
Likewise, the jurisdictional and enforcement issues on overseas
workers' money claims do not justify a differentiated treatment in the
computation of their money claims. 123 If anything, these issues justify an
equal, if not greater protection and assistance to overseas workers who
generally are more prone to exploitation given their physical distance from
our government.
We also find that the classifications are not relevant to the purpose of
the law, which is to "establish a higher standard of protection and promotion
of the welfare of migrant workers, their families and overseas Filipinos in
distress, and for other purposes." 124 Further, we find specious the
argument that reducing the liability of placement agencies "redounds to the
benefit of the [overseas] workers." 125 DCSTAH
Putting a cap on the money claims of certain overseas workers does
not increase the standard of protection afforded to them. On the other hand,
foreign employers are more incentivized by the reinstated clause to enter into
contracts of at least a year because it gives them more flexibility to violate
our overseas workers' rights. Their liability for arbitrarily terminating overseas
workers is decreased at the expense of the workers whose rights they
violated. Meanwhile, these overseas workers who are impressed with an
expectation of a stable job overseas for the longer contract period disregard
other opportunities only to be terminated earlier. They are left with claims that
are less than what others in the same situation would receive. The reinstated
clause, therefore, creates a situation where the law meant to protect them
makes violation of rights easier and simply benign to the violator.
As Justice Brion said in his concurring opinion in Serrano:
Section 10 of R.A. No. 8042 affects these well-laid
rules and measures, and in fact provides a hidden twist
affecting the principal/employer's liability. While intended
as an incentive accruing to recruitment/manning
agencies, the law, as worded, simply limits the OFWs'
recovery in wrongful dismissal situations. Thus, it
redounds to the benefit of whoever may be liable,
including the principal/employer — the direct employer
primarily liable for the wrongful dismissal. In this sense,
Section 10 — read as a grant of incentives to
recruitment/manning agencies — oversteps what it aims to
do by effectively limiting what is otherwise the full liability
of the foreign principals/employers. Section 10, in short,
really operates to benefit the wrong party and allows that
party, without justifiable reason, to mitigate its liability for
wrongful dismissals. Because of this hidden twist, the
limitation of liability under Section 10 cannot be an
"appropriate" incentive, to borrow the term that R.A. No.
8042 itself uses to describe the incentive it envisions under
its purpose clause.
What worsens the situation is the chosen mode of
granting the incentive: instead of a grant that, to
encourage greater efforts at recruitment, is directly related
to extra efforts undertaken, the law simply limits their
liability for the wrongful dismissals of already deployed
OFWs. This is effectively a legally-imposed partial
condonation of their liability to OFWs, justified solely by the
law's intent to encourage greater deployment efforts. Thus,
the incentive, from a more practical and realistic view, is
really part of a scheme to sell Filipino overseas labor at a
bargain for purposes solely of attracting the
market. . . . cdasia
The so-called incentive is rendered particularly
odious by its effect on the OFWs — the benefits accruing
to the recruitment/manning agencies and their principals
are taken from the pockets of the OFWs to whom the full
salaries for the unexpired portion of the contract rightfully
belong. Thus, the principals/employers and the
recruitment/manning agencies even profit from their
 violation of the security of tenure that an employment
contract embodies. Conversely, lesser protection is
afforded the OFW, not only because of the lessened
recovery afforded him or her by operation of law, but also
because this same lessened recovery renders a wrongful
dismissal easier and less onerous to undertake; the lesser
cost of dismissing a Filipino will always be a consideration
a foreign employer will take into account in termination of
employment decisions. . . . 126
Further, "[t]here can never be a justification for any form of
government action that alleviates the burden of one sector, but imposes the
same burden on another sector, especially when the favored sector is
composed of private businesses such as placement agencies, while the
disadvantaged sector is composed of OFWs whose protection no less than
the Constitution commands. The idea that private business interest can be
elevated to the level of a compelling state interest is odious." 127
Along the same line, we held that the reinstated clause violates due
process rights. It is arbitrary as it deprives overseas workers of their
monetary claims without any discernable valid purpose. 128 ADEaHT
Respondent Joy Cabiles is entitled to her salary for the unexpired
portion of her contract, in accordance with Section 10 of Republic Act No.
8042. The award of the three-month equivalence of respondent's salary must
be modified accordingly. Since she started working on June 26, 1997 and
was terminated on July 14, 1997, respondent is entitled to her salary from
July 15, 1997 to June 25, 1998. "To rule otherwise would be iniquitous to
petitioner and other OFWs, and would, in effect, send a wrong signal that
principals/employers and recruitment/manning agencies may violate an
OFW's security of tenure which an employment contract embodies and
actually profit from such violation based on an unconstitutional provision of
law." 129
III
On the interest rate, the Bangko Sentral ng Pilipinas Circular No.
799 of June 21, 2013, which revised the interest rate for loan or forbearance
from 12% to 6% in the absence of stipulation, applies in this case. The
pertinent portions of Circular No. 799, Series of 2013, read: TEacSA
The Monetary Board, in its Resolution No. 796
dated 16 May 2013, approved the following revisions
governing the rate of interest in the absence of stipulation
in loan contracts, thereby amending Section 2 of Circular
No. 905, Series of 1982:
Section 1. The rate of interest for the loan or
forbearance of any money, goods or credits and the rate
allowed in judgments, in the absence of an express
contract as to such rate of interest, shall be six percent
(6%) per annum.
Section 2. In view of the above, Subsection
X305.1 of the Manual of Regulations for Banks and
Sections 4305Q.1, 4305S.3 and 4303P.1 of the Manual of
Regulations for Non-Bank Financial Institutions are hereby
amended accordingly.
This Circular shall take effect on 1 July 2013.
Through the able ponencia  of Justice Diosdado Peralta, we laid
down the guidelines in computing legal interest in  Nacar v. Gallery
Frames: 130
II. With regard particularly to an award of interest
in the concept of actual and compensatory damages, the
rate of interest, as well as the accrual thereof, is imposed,
as follows:
1. When the obligation is breached, and it consists
in the payment of a sum of money, i.e., a
loan or forbearance of money, the interest
due should be that which may have been
stipulated in writing. Furthermore, the
interest due shall itself earn legal interest
from the time it is judicially demanded. In
the absence of stipulation, the rate of
interest shall be 6% per annum to be
computed from default, i.e., from judicial or
extrajudicial demand under and subject to
the provisions of Article 1169 of the Civil
Code.
2. When an obligation, not constituting a loan or
forbearance of money, is breached, an
interest on the amount of damages
awarded may be imposed at the discretion
of the court at the rate of 6%  per annum.
No interest, however, shall be adjudged
on unliquidated claims or damages,
except when or until the demand can be
established with reasonable certainty.
Accordingly, where the demand is
established with reasonable certainty, the
interest shall begin to run from the time
the claim is made judicially or
extrajudicially (Art. 1169, Civil Code), but
 when such certainty cannot be so
reasonably established at the time the
demand is made, the interest shall begin
to run only from the date the judgment of
the court is made (at which time the
quantification of damages may be deemed
to have been reasonably ascertained).
The actual base for the computation of
legal interest shall, in any case, be on the
amount finally adjudged. aDIHTE
3. When the judgment of the court awarding a sum
of money becomes final and executory,
the rate of legal interest, whether the case
falls under paragraph 1 or paragraph 2,
above, shall be 6% per annum from such
finality until its satisfaction, this interim
period being deemed to be by then an
equivalent to a forbearance of credit.
And, in addition to the above, judgments that have
become final and executory prior to July 1, 2013, shall not
be disturbed and shall continue to be implemented
applying the rate of interest fixed therein. 131
Circular No. 799 is applicable only in loans and forbearance of
money, goods, or credits, and in judgments when there is no stipulation on
the applicable interest rate. Further, it is only applicable if the judgment did
not become final and executory before July 1, 2013. 132
We add that Circular No. 799 is not applicable when there is a law
that states otherwise. While the Bangko Sentral ng Pilipinas has the power to
set or limit interest rates, 133 these interest rates do not apply when the law
provides that a different interest rate shall be applied. "[A] Central Bank
Circular cannot repeal a law. Only a law can repeal another law." 134
For example, Section 10 of Republic Act No. 8042 provides that
unlawfully terminated overseas workers are entitled to the reimbursement of
his or her placement fee with an interest of 12% per annum. Since Bangko
Sentral ng Pilipinas circulars cannot repeal Republic Act No. 8042, the
issuance of Circular No. 799 does not have the effect of changing the interest
on awards for reimbursement of placement fees from 12% to 6%. This is
despite Section 1 of Circular No. 799, which provides that the 6% interest
rate applies even to judgments. ADaSEH
Moreover, laws are deemed incorporated in contracts. "The
contracting parties need not repeat them. They do not even have to be
referred to. Every contract, thus, contains not only what has been explicitly
stipulated, but the statutory provisions that have any bearing on the
matter." 135 There is, therefore, an implied stipulation in contracts between
the placement agency and the overseas worker that in case the overseas
worker is adjudged as entitled to reimbursement of his or her placement fees,
the amount shall be subject to a 12% interest per annum. This implied
stipulation has the effect of removing awards for reimbursement of placement
fees from Circular No. 799's coverage.
The same cannot be said for awards of salary for the unexpired
portion of the employment contract under Republic Act No. 8042. These
awards are covered by Circular No. 799 because the law does not provide
for a specific interest rate that should apply.
In sum, if judgment did not become final and executory before July 1,
2013 and there was no stipulation in the contract providing for a different
interest rate, other money claims under Section 10 of Republic Act No.
8042 shall be subject to the 6% interest per annum in accordance
with Circular No. 799.
This means that respondent is also entitled to an interest of 6% per
annum on her money claims from the finality of this judgment. EASIHa
IV
Finally, we clarify the liabilities of Wacoal as principal and petitioner
as the employment agency that facilitated respondent's overseas
employment.
Section 10 of the Migrant Workers and Overseas Filipinos Act of
1995 provides that the foreign employer and the local employment agency
are jointly and severally liable for money claims including claims arising out
of an employer-employee relationship and/or damages. This section also
provides that the performance bond filed by the local agency shall be
answerable for such money claims or damages if they were awarded to the
employee.
This provision is in line with the state's policy of affording protection
to labor and alleviating workers' plight. 136 ECaITc
In overseas employment, the filing of money claims against the
foreign employer is attended by practical and legal complications. The
distance of the foreign employer alone makes it difficult for an overseas
worker to reach it and make it liable for violations of the Labor Code. There
are also possible conflict of laws, jurisdictional issues, and procedural rules
that may be raised to frustrate an overseas worker's attempt to advance his
or her claims.
It may be argued, for instance, that the foreign employer must be
impleaded in the complaint as an indispensable party without which no final
determination can be had of an action. 137
 The provision on joint and several liability in the Migrant Workers and
Overseas Filipinos Act of 1995 assures overseas workers that their rights will
not be frustrated with these complications.
The fundamental effect of joint and several liability is that "each of
the debtors is liable for the entire obligation." 138 A final determination may,
therefore, be achieved even if only one of the joint and several debtors are
impleaded in an action. Hence, in the case of overseas employment, either
the local agency or the foreign employer may be sued for all claims arising
from the foreign employer's labor law violations. This way, the overseas
workers are assured that someone — the foreign employer's local agent —
may be made to answer for violations that the foreign employer may have
committed.
The Migrant Workers and Overseas Filipinos Act of 1995 ensures
that overseas workers have recourse in law despite the circumstances of
their employment. By providing that the liability of the foreign employer may
be "enforced to the full extent" 139 against the local agent, the overseas
worker is assured of immediate and sufficient payment of what is due
them. 140 AcSIDE
Corollary to the assurance of immediate recourse in law, the
provision on joint and several liability in the Migrant Workers and Overseas
Filipinos Act of 1995 shifts the burden of going after the foreign employer
from the overseas worker to the local employment agency. However, it must
be emphasized that the local agency that is held to answer for the overseas
worker's money claims is not left without remedy. The law does not preclude
it from going after the foreign employer for reimbursement of whatever
payment it has made to the employee to answer for the money claims
against the foreign employer.
A further implication of making local agencies jointly and severally
liable with the foreign employer is that an additional layer of protection is
afforded to overseas workers. Local agencies, which are businesses by
nature, are inoculated with interest in being always on the lookout against
foreign employers that tend to violate labor law. Lest they risk their reputation
or finances, local agencies must already have mechanisms for guarding
against unscrupulous foreign employers even at the level prior to overseas
employment applications.
With the present state of the pleadings, it is not possible to determine
whether there was indeed a transfer of obligations from petitioner to Pacific.
This should not be an obstacle for the respondent overseas worker to
proceed with the enforcement of this judgment. Petitioner is possessed with
the resources to determine the proper legal remedies to enforce its rights
against Pacific, if any.
V WHEREFORE, the petition is DENIED. The decision of the Court of
Many times, this court has spoken on what Filipinos may encounter
as they travel into the farthest and most difficult reaches of our planet to
provide for their families. In  Prieto v. NLRC: 141 ESDcIA
The Court is not unaware of the many abuses
suffered by our overseas workers in the foreign land where
they have ventured, usually with heavy hearts, in pursuit of
a more fulfilling future. Breach of contract, maltreatment,
rape, insufficient nourishment, sub-human lodgings, insults
and other forms of debasement, are only a few of the
inhumane acts to which they are subjected by their foreign
employers, who probably feel they can do as they please
in their own country. While these workers may indeed
have relatively little defense against exploitation while they
are abroad, that disadvantage must not continue to burden
them when they return to their own territory to voice their
muted complaint. There is no reason why, in their very
own land, the protection of our own laws cannot be
extended to them in full measure for the redress of their
grievances. 142
But it seems that we have not said enough.
We face a diaspora of Filipinos. Their travails and their heroism can
be told a million times over; each of their stories as real as any other.
Overseas Filipino workers brave alien cultures and the heartbreak of families
left behind daily. They would count the minutes, hours, days, months, and
years yearning to see their sons and daughters. We all know of the joy and
sadness when they come home to see them all grown up and, being so, they
remember what their work has cost them. Twitter accounts, Facetime, and
many other gadgets and online applications will never substitute for their lost
physical presence.
Unknown to them, they keep our economy afloat through the ebb
and flow of political and economic crises. They are our true diplomats, they
who show the world the resilience, patience, and creativity of our people.
Indeed, we are a people who contribute much to the provision of material
creations of this world. EaHDcS
This government loses its soul if we fail to ensure decent treatment
for all Filipinos. We default by limiting the contractual wages that should be
paid to our workers when their contracts are breached by the foreign
employers. While we sit, this court will ensure that our laws will reward our
overseas workers with what they deserve: their dignity.
Inevitably, their dignity is ours as well.
Appeals is AFFIRMED with modification. Petitioner Sameer Overseas
Placement Agency is ORDERED to pay respondent Joy C. Cabiles the
amount equivalent to her salary for the unexpired portion of her employment
contract at an interest of 6% per annum from the finality of this judgment.
Petitioner is also ORDERED to reimburse respondent the withheld
NT$3,000.00 salary and pay respondent attorney's fees of NT$300.00 at an
interest of 6% per annum from the finality of this judgment.
The clause, "or for three (3) months for every year of the unexpired
term, whichever is less" in Section 7 of Republic Act No. 10022 amending
Section 10 of Republic Act No. 8042 is declared unconstitutional and,
therefore, null and void.
SO ORDERED.
[G.R. No. 205703. March 7, 2016.]
INDUSTRIAL PERSONNEL & MANAGEMENT
SERVICES, INC. (IPAMS), SNC LAVALIN ENGINEERS
& CONTRACTORS, INC. AND ANGELITO C.
HERNANDEZ, petitioners, vs. JOSE G. DE VERA AND
ALBERTO B. ARRIOLA, respondents.
DECISION
MENDOZA, J  p:
When can a foreign law govern an overseas employment
contract? This is the fervent question that the Court shall resolve, once
and for all.
This petition for review on certiorari seeks to reverse and set
aside the January 24, 2013 Decision 1 of the Court of Appeals (CA) in
CA-G.R. SP No. 118869, which modified the November 30, 2010
Decision 2 of the National Labor Relations Commission (NLRC) and its
February 2, 2011 Resolution, 3 in NLRC LAC Case No. 08-000572-
10/NLRC Case No. NCR 09-13563-09, a case for illegal termination of
an Overseas Filipino Worker (OFW).
The Facts
Petitioner Industrial Personnel & Management Services,
Inc. (IPAMS) is a local placement agency duly organized and existing
under Philippine laws, with petitioner Angelito C. Hernandez as its
president and managing director. Petitioner SNC Lavalin Engineers &
Contractors, Inc. (SNC-Lavalin) is the principal of IPAMS, a Canadian
company with business interests in several countries. On the other hand,
respondent Alberto Arriola (Arriola) is a licensed general surgeon in the
Philippines. 4
Employee's Position
Arriola was offered by SNC-Lavalin, through its letter, 5 dated
May 1, 2008, the position of Safety Officer in its Ambatovy Project site in
Madagascar. The position offered had a rate of CA$32.00 per hour for
forty (40) hours a week with overtime pay in excess of forty (40) hours. It
was for a period of nineteen (19) months starting from June 9, 2008 to
December 31, 2009.
Arriola was then hired by SNC-Lavalin, through its local manning
agency, IPAMS, and his overseas employment contract was processed
with the Philippine Overseas Employment Agency (POEA). 6 In a letter
of understanding, 7 dated June 5, 2008, SNC-Lavalin confirmed Arriola's
assignment in the Ambatovy Project. According to Arriola, he signed the
contract of employment in the Philippines. 8 On June 9, 2008, Arriola
started working in Madagascar. cSaATC
After three months, Arriola received a notice of pre-termination of
employment, 9 dated September 9, 2009, n from SNC-Lavalin. It stated
that his employment would be pre-terminated effective September 11,
2009 due to diminishing workload in the area of his expertise and the
unavailability of alternative assignments. Consequently, on September
15, 2009, Arriola was repatriated. SNC-Lavalin deposited in Arriola's
bank account his pay amounting to Two Thousand Six Hundred Thirty
Six Dollars and Eight n Centavos (CA$2,636.80), based on Canadian
labor law.
Aggrieved, Arriola filed a complaint against the petitioners for
illegal dismissal and non-payment of overtime pay, vacation leave and
sick leave pay before the Labor Arbiter (LA). He claimed that SNC-
Lavalin still owed him unpaid salaries equivalent to the three-month
unexpired portion of his contract, amounting to, more or less, One Million
Sixty-Two Thousand Nine Hundred Thirty-Six Pesos (P1,062,936.00). He
asserted that SNC-Lavalin never offered any valid reason for his early
termination and that he was not given sufficient notice regarding the
same. Arriola also insisted that the petitioners must prove the
applicability of Canadian law before the same could be applied to his
employment contract.
Employer's Position
The petitioners denied the charge of illegal dismissal against
them. They claimed that SNC-Lavalin was greatly affected by the global
financial crises during the latter part of 2008. The economy of
Madagascar, where SNC-Lavalin had business sites, also slowed down.
As proof of its looming financial standing, SNC-Lavalin presented a copy
of a news item in the Financial Post, 10 dated March 5, 2009, showing
the decline of the value of its stocks. Thus, it had no choice but to
minimize its expenditures and operational expenses. It re-organized its
Health and Safety Department at the Ambatovy Project site and Arriola
was one of those affected. 11
The petitioners also invoked EDI-Staffbuilders International, Inc.
v. NLRC 12 (EDI-Staffbuilders), pointing out that particular labor laws of
a foreign country incorporated in a contract freely entered into between
an OFW and a foreign employer through the latter's agent was valid. In
the present case, as all of Arriola's employment documents were
processed in Canada, not to mention that SNC-Lavalin's office was in
Ontario, the principle of lex loci celebrationis was applicable. Thus, the
petitioners insisted that Canadian laws governed the contract.
The petitioners continued that the pre-termination of Arriola's
contract was valid for being consistent with the provisions of both the
Expatriate Policy and laws of Canada. The said foreign law did not
require any ground for early termination of employment, and the only
requirement was the written notice of termination. Even assuming that
Philippine laws should apply, Arriola would still be validly dismissed
because domestic law recognized retrenchment and redundancy as legal
grounds for termination.
In their Rejoinder, 13 the petitioners presented a copy of the
Employment Standards Act (ESA) of Ontario, which was duly
authenticated by the Canadian authorities and certified by the Philippine
Embassy.
The LA Ruling
In a Decision, 14 dated May 31, 2010, the LA dismissed Arriola's
complaint for lack of merit. The LA ruled that the rights and obligations
among and between the OFW, the local recruiter/agent, and the foreign
employer/principal were governed by the employment contract pursuant
to the EDI-Staffbuilders case. Thus, the provisions on termination of
employment found in the ESA, a foreign law which governed Arriola's
employment contract, were applied. Given that SNC-Lavalin was able to
produce the duly authenticated ESA, the LA opined that there was no
other conclusion but to uphold the validity of Arriola's dismissal based on
Canadian law. The fallo of the LA decision reads:
WHEREFORE, all the foregoing premises being
considered, judgment is hereby rendered dismissing the
complaint for lack of merit.
SO ORDERED. 15
Aggrieved, Arriola elevated the LA decision before the NLRC.
The NLRC Ruling
In its decision, dated November 30, 2010, the NLRC reversed
the LA decision and ruled that Arriola was illegally dismissed by the
petitioners. Citing PNB v. Cabansag, 16 the NLRC stated that whether
employed locally or overseas, all Filipino workers enjoyed the protective
mantle of Philippine labor and social legislation, contract stipulations to
the contrary notwithstanding. Thus, the Labor Code of the
Philippines and Republic Act (R.A.) No. 8042, or the Migrant Workers
Act, as amended, should be applied. Moreover, the NLRC added that the
overseas employment contract of Arriola was processed in the POEA.
Applying the Philippine laws, the NLRC found that there was no
substantial evidence presented by the petitioners to show any just or
authorized cause to terminate Arriola. The ground of financial losses by
SNC-Lavalin was not supported by sufficient and credible evidence. The
NLRC concluded that, for being illegally dismissed, Arriola should be
awarded CA$81,920.00 representing sixteen (16) months of Arriola's
purported unpaid salary, pursuant to the Serrano v. Gallant 17 doctrine.
The decretal portion of the NLRC decision states: cHDAIS
WHEREFORE, premises considered, judgment
is hereby rendered finding complainant-appellant to have
been illegally dismissed. Respondents-appellees are
hereby ordered to pay complainant-appellant the amount
of CA$81,920.00, or its Philippine Peso equivalent
prevailing at the time of payment. Accordingly, the
decision of the Labor Arbiter dated May 31, 2010 is
hereby VACATED and SET ASIDE.
SO ORDERED. 18
The petitioners moved for reconsideration, but their motion was
denied by the NLRC in its resolution, dated February 2, 2011.
 Undaunted, the petitioners filed a petition for certiorari before the
CA arguing that it should be the ESA, or the Ontario labor law, that
should be applied in Arriola's employment contract. No temporary
restraining order, however, was issued by the CA.
The Execution Proceedings
In the meantime, execution proceedings were commenced
before the LA by Arriola. The LA granted the motion for execution in the
Order, 19 dated August 8, 2011.
The petitioners appealed the execution order to the NLRC. In its
Decision, 20 dated May 31, 2012, the NLRC corrected the decretal
portion of its November 30, 2010 decision. It decreased the award of
backpay in the amount of CA$26,880.00 or equivalent only to three (3)
months and three (3) weeks pay based on 70-hours per week workload.
The NLRC found that when Arriola was dismissed on September 9,
2009, he only had three (3) months and three (3) weeks or until
December 31, 2009 remaining under his employment contract.
Still not satisfied with the decreased award, IPAMS filed a
separate petition for certiorari before the CA. In its decision, dated July
25, 2013, the CA affirmed the decrease in Arriola's backpay because the
unpaid period in his contract was just three (3) months and three (3)
weeks.
Unperturbed, IPAMS appealed before the Court and the case
was docketed as G.R. No. 212031. The appeal, however, was dismissed
outright by the Court in its resolution, dated August 8, 2014, because it
was belatedly filed and it did not comply with Sections 4 and 5 of Rule 7
of the Rules of Court. Hence, it was settled in the execution proceedings
that the award of backpay to Arriola should only amount to three (3)
months and three (3) weeks of his pay.
The CA Ruling
Returning to the principal case of illegal dismissal, in its assailed
January 24, 2013 decision, the CA affirmed that Arriola was illegally
dismissed by the petitioners. The CA explained that even though an
authenticated copy of the ESA was submitted, it did not mean that the
said foreign law automatically applied in this case. Although parties were
free to establish stipulations in their contracts, the same must remain
consistent with law, morals, good custom, public order or public policy.
The appellate court wrote that the ESA allowed an employer to disregard
the required notice of termination by simply giving the employee a
severance pay. The ESA could not be made to apply in this case for
being contrary to our Constitution, specifically on the right of due
process. Thus, the CA opined that our labor laws should find application.
As the petitioners neither complied with the twin notice-rule nor
offered any just or authorized cause for his termination under the Labor
Code, the CA held that Arriola's dismissal was illegal. Accordingly, it
pronounced that Arriola was entitled to his salary for the unexpired
portion of his contract which is three (3) months and three (3) weeks
salary. It, however, decreased the award of backpay to Arriola because
the NLRC made a wrong calculation. Based on his employment contract,
the backpay of Arriola should only be computed on a 40-hour per week
workload, or in the amount of CA$19,200.00. The CA disposed the case
in this wise:
WHEREFORE, in view of the foregoing
premises, the petition is PARTIALLY GRANTED. The
assailed Order of the National Labor Relations
Commission in NLRC LAC No. 08-000572-10/NLRC
Case No. NCR 09-13563-09 is MODIFIED in that private
respondent is only entitled to a monetary judgment
equivalent to his unpaid salaries in the amount of
CA$19,200.00 or its Philippine Peso equivalent.
SO ORDERED. 21
Hence, this petition, anchored on the following
ISSUES
I
WHETHER OR NOT RESPONDENT ARRIOLA WAS
VALIDLY DISMISSED PURSUANT TO THE
EMPLOYMENT CONTRACT.
II
GRANTING THAT THERE WAS ILLEGAL DISMISSAL
IN THE CASE AT BAR, WHETHER OR NOT THE SIX-
WEEK ON, TWO-WEEK OFF SCHEDULE SHOULD
BE USED IN THE COMPUTATION OF ANY
MONETARY AWARD.
III
GRANTING THAT THERE WAS ILLEGAL DISMISSAL,
WHETHER OR NOT THE AMOUNT BEING CLAIMED
BY RESPONDENTS HAD ALREADY BEEN
SATISFIED, OR AT THE VERY LEAST, WHETHER OR
NOT THE AMOUNT OF CA$2,636.80 SHOULD BE
DEDUCTED FROM THE MONETARY AWARD. 22
The petitioners argue that the rights and obligations of the OFW,
the local recruiter, and the foreign employer are governed by the
employment contract, citing EDI-Staffbuilders; that the terms and
conditions of Arriola's employment are embodied in the Expatriate Policy,
Ambatovy Project-Site, Long Term, hence, the laws of Canada must be
applied; that the ESA, or the Ontario labor law, does not require any
ground for the early termination of employment and it permits the
termination without any notice provided that a severance pay is given;
that the ESA was duly authenticated by the Canadian authorities and
certified by the Philippine Embassy; that the NLRC Sixth Division
exhibited bias and bad faith when it made a wrong computation on the
award of backpay; and that, assuming there was illegal dismissal, the
CA$2,636.80, earlier paid to Arriola, and his home leaves should be
deducted from the award of backpay. ISHCcT
In his Comment, 23 Arriola countered that foreign laws could not
apply to employment contracts if they were contrary to law, morals, good
customs, public order or public policy, invoking Pakistan International
Airlines Corporation v. Ople (Pakistan International); 24 that the ESA
was not applicable because it was contrary to his constitutional right to
due process; that the petitioners failed to substantiate an authorized
cause to justify his dismissal under Philippine labor law; and that the
petitioners could not anymore claim a deduction of CA$2,636.80 from the
award of backpay because it was raised for the first time on appeal.
In their Reply, 25 the petitioners asserted that R.A. No.
8042 recognized the applicability of foreign laws on labor contracts; that
the Pakistan International case was superseded by EDI-Staffbuilders and
other subsequent cases; and that SNC-Lavalin suffering financial losses
was an authorized cause to terminate Arriola's employment.
In his Memorandum, 26 Arriola asserted that his employment
contract was executed in the Philippines and that the alleged authorized
cause of financial losses by the petitioners was not substantiated by
evidence.
In their Consolidated Memorandum, 27 the petitioners reiterated
that the ESA was applicable in the present case and that recent
jurisprudence recognized that the parties could agree on the applicability
of foreign laws in their labor contracts.
The Court's Ruling
The petition lacks merit.
Application of foreign
laws with labor contracts
At present, Filipino laborers, whether skilled or professional, are
enticed to depart from the motherland in search of greener pastures.
There is a distressing reality that the offers of employment abroad are
more lucrative than those found in our own soils. To reap the promises of
the foreign dream, our unsung heroes must endure homesickness,
solitude, discrimination, mental and emotional struggle, at times, physical
turmoil, and, worse, death. On the other side of the table is the growing
number of foreign employers attracted in hiring Filipino workers because
of their reasonable compensations and globally-competitive skills and
qualifications. Between the dominant foreign employers and the
vulnerable and desperate OFWs, however, there is an inescapable truth
that the latter are in need of greater safeguard and protection.
In order to afford the full protection of labor to our OFWs, the
State has vigorously enacted laws, adopted regulations and policies, and
established agencies to ensure that their needs are satisfied and that
they continue to work in a humane living environment outside of the
country. Despite these efforts, there are still issues left unsolved in the
realm of overseas employment. One existing question is posed before
the Court — when should an overseas labor contract be governed by a
foreign law? To answer this burning query, a review of the relevant laws
and jurisprudence is warranted.
R.A. No. 8042, or the Migrant Workers Act, was enacted to
institute the policies on overseas employment and to establish a higher
standard of protection and promotion of the welfare of migrant
workers. 28 It emphasized that while recognizing the significant
contribution of Filipino migrant workers to the national economy through
their foreign exchange remittances, the State does not promote overseas
employment as a means to sustain economic growth and achieve
national development. 29 Although it acknowledged claims arising out of
law or contract involving Filipino workers, 30 it does not categorically
provide that foreign laws are absolutely and automatically applicable in
overseas employment contracts.
The issue of applying foreign laws to labor contracts was initially
raised before the Court in Pakistan International. It was stated in the
labor contract therein (1) that it would be governed by the laws of
Pakistan, (2) that the employer have the right to terminate the employee
at any time, and (3) that the one-month advance notice in terminating the
employment could be dispensed with by paying the employee an
equivalent one-month salary. Therein, the Court elaborated on the
parties' right to stipulate in labor contracts, to wit:
A contract freely entered into should, of course,
be respected, as PIA argues, since a contract is the law
between the parties. The principle of party autonomy in
contracts is not, however, an absolute principle. The rule
in Article 1306, of our Civil Code is that the contracting
parties may establish such stipulations as they may
deem convenient, "provided they are not contrary to
law, morals, good customs, public order or public
policy." Thus, counter-balancing the principle of
 autonomy of contracting parties is the equally general
rule that provisions of applicable law, especially
provisions relating to matters affected with public policy,
are deemed written into the contract. Put a little
differently, the governing principle is that parties may not
contract away applicable provisions of law especially
peremptory provisions dealing with matters heavily
impressed with public interest. The law relating to labor
and employment is clearly such an area and parties
are not at liberty to insulate themselves and their
relationships from the impact of labor laws and
regulations by simply contracting with each other. . .
. 31 CAacTH
[Emphases Supplied]
In that case, the Court held that the labor relationship between
OFW and the foreign employer is "much affected with public interest and
that the otherwise applicable Philippine laws and regulations cannot be
rendered illusory by the parties agreeing upon some other law to govern
their relationship." 32 Thus, the Court applied the Philippine laws, instead
of the Pakistan laws. It was also held that the provision in the
employment contract, where the employer could terminate the employee
at any time for any ground and it could even disregard the notice of
termination, violates the employee's right to security of tenure under
Articles 280 and 281 of the Labor Code.
In EDI-Staffbuilders, the case heavily relied on by the petitioners,
it was reiterated that, "[i]n formulating the contract, the parties may
establish such stipulations, clauses, terms and conditions as they may
deem convenient, provided they are not contrary to law, morals, good
customs, public order, or public policy." 33 In that case, the overseas
contract specifically stated that Saudi Labor Laws would govern matters
not provided for in the contract. The employer, however, failed to prove
the said foreign law, hence, the doctrine of processual presumption came
into play and the Philippine labor laws were applied. Consequently, the
Court did not discuss any longer whether the Saudi labor laws were
contrary to Philippine labor laws.
The case of Becmen Service Exporter and Promotion, Inc. v.
Spouses Cuaresma, 34 though not an illegal termination case,
elucidated on the effect of foreign laws on employment. It involved a
complaint for insurance benefits and damages arising from the death of a
Filipina nurse from Saudi Arabia. It was initially found therein that there
was no law in Saudi Arabia that provided for insurance arising from labor
accidents. Nevertheless, the Court concluded that the employer and the
recruiter in that case abandoned their legal, moral and social obligation
to assist the victim's family in obtaining justice for her death, and so her
family was awarded P5,000,000.00 for moral and exemplary damages.
In ATCI Overseas Corporation v. Echin 35 (ATCI Overseas), the
private recruitment agency invoked the defense that the foreign employer
was immune from suit and that it did not sign any document agreeing to
be held jointly and solidarily liable. Such defense, however, was rejected
because R.A. No. 8042 precisely afforded the OFWs with a recourse
against the local agency and the foreign employer to assure them of an
immediate and sufficient payment of what was due. Similar to EDI-
Staffbuilders, the local agency therein failed to prove the Kuwaiti law
specified in the labor contract, pursuant to Sections 24 and 25 of Rule
132 of the Revised Rules of Court.
Also, in the recent case of Sameer Overseas Placement
Agency, Inc. v. Cabiles 36 (Sameer Overseas), it was declared that the
security of tenure for labor was guaranteed by our Constitution and
employees were not stripped of the same when they moved to work in
other jurisdictions. Citing PCL Shipping Phils., Inc. v. NLRC 37 (PCL
Shipping), the Court held that the principle of lex loci contractus (the law
of the place where the contract is made) governed in this jurisdiction. As
it was established therein that the overseas labor contract was executed
in the Philippines, the Labor Code and the fundamental procedural rights
were observed. It must be noted that no foreign law was specified in the
employment contracts in both cases.
Lastly, in Saudi Arabian Airlines (Saudia) v. Rebesencio, 38 the
employer therein asserted the doctrine of forum non conveniens because
the overseas employment contracts required the application of the laws
of Saudi Arabia, and so, the Philippine courts were not in a position to
hear the case. In striking down such argument, the Court held that while
a Philippine tribunal was called upon to respect the parties' choice of
governing law, such respect must not be so permissive as to lose sight of
considerations of law, morals, good customs, public order, or public
policy that underlie the contract central to the controversy. As the dispute
in that case related to the illegal termination of the employees due to
their pregnancy, then it involved a matter of public interest and public
policy. Thus, it was ruled that Philippine laws properly found application
and that Philippine tribunals could assume jurisdiction.
Based on the foregoing, the general rule is that Philippine laws
apply even to overseas employment contracts. This rule is rooted in the
constitutional provision of Section 3, Article XIII that the State shall afford
full protection to labor, whether local or overseas. Hence, even if the
OFW has his employment abroad, it does not strip him of his rights to
security of tenure, humane conditions of work and a living wage under
our Constitution. 39
 As an exception, the parties may agree that a foreign law shall
govern the employment contract. A synthesis of the existing laws and
jurisprudence reveals that this exception is subject to the following
requisites:
1. That it is expressly stipulated in the overseas employment
contract that a specific foreign law shall govern;
2. That the foreign law invoked must be proven before the courts
pursuant to the Philippine rules on evidence;
3. That the foreign law stipulated in the overseas employment
contract must not be contrary to law, morals, good
customs, public order, or public policy of the Philippines;
and IAETDc
4. That the overseas employment contract must be processed
through the POEA.
The Court is of the view that these four (4) requisites must be
complied with before the employer could invoke the applicability of a
foreign law to an overseas employment contract. With these requisites,
the State would be able to abide by its constitutional obligation to ensure
that the rights and well-being of our OFWs are fully protected. These
conditions would also invigorate the policy under R.A. No. 8042 that the
State shall, at all times, uphold the dignity of its citizens whether in
country or overseas, in general, and the Filipino migrant workers, in
particular. 40 Further, these strict terms are pursuant to the
jurisprudential doctrine that "parties may not contract away applicable
provisions of law especially peremptory provisions dealing with matters
heavily impressed with public interest," 41 such as laws relating to labor.
At the same time, foreign employers are not at all helpless to apply their
own laws to overseas employment contracts provided that they faithfully
comply with these requisites.
If the first requisite is absent, or that no foreign law was
expressly stipulated in the employment contract which was executed in
the Philippines, then the domestic labor laws shall apply in accordance
with the principle of lex loci contractus. This is based on the cases
of Sameer Overseas  and PCL Shipping.
If the second requisite is lacking, or that the foreign law was not
proven pursuant to Sections 24 and 25 of Rule 132 of the Revised Rules
of Court, then the international law doctrine of processual presumption
operates. The said doctrine declares that "[w]here a foreign law is not
pleaded or, even if pleaded, is not proved, the presumption is that foreign
law is the same as ours." 42 This was observed in the cases of EDI-
Staffbuilders and ATCI Overseas.
If the third requisite is not met, or that the foreign law stipulated
is contrary to law, morals, good customs, public order or public policy,
then Philippine laws govern. This finds legal bases in the Civil Code,
specifically: (1) Article 17, which provides that laws which have, for their
object, public order, public policy and good customs shall not be
rendered ineffective by laws of a foreign country; and (2) Article 1306,
which states that the stipulations, clauses, terms and conditions in a
contract must not be contrary to law, morals, good customs, public order,
or public policy. The said doctrine was applied in the case of Pakistan
International.
Finally, if the fourth requisite is missing, or that the overseas
employment contract was not processed through the POEA, then Article
18 of the Labor Code is violated. Article 18 provides that no employer
may hire a Filipino worker for overseas employment except through the
boards and entities authorized by the Secretary of Labor. In relation
thereto, Section 4 of R.A. No. 8042, as amended, declares that the State
shall only allow the deployment of overseas Filipino workers in countries
where the rights of Filipino migrant workers are protected. Thus, the
POEA, through the assistance of the Department of Foreign Affairs,
reviews and checks whether the countries have existing labor and social
laws protecting the rights of workers, including migrant
workers. 43 Unless processed through the POEA, the State has no
effective means of assessing the suitability of the foreign laws to our
migrant workers. Thus, an overseas employment contract that was not
scrutinized by the POEA definitely cannot be invoked as it is an
unexamined foreign law.
In other words, lacking any one of the four requisites would
invalidate the application of the foreign law, and the Philippine law shall
govern the overseas employment contract.
As the requisites of the applicability of foreign laws in overseas
labor contract have been settled, the Court can now discuss the merits of
the case at bench.
A judicious scrutiny of the records of the case demonstrates that
the petitioners were able to observe the second requisite, or that the
foreign law must be proven before the court pursuant to the Philippine
rules on evidence. The petitioners were able to present the ESA, duly
authenticated by the Canadian authorities and certified by the Philippine
Embassy, before the LA. The fourth requisite was also followed because
Arriola's employment contract was processed through the POEA. 44
Unfortunately for the petitioners, those were the only requisites
that they complied with. As correctly held by the CA, even though an
authenticated copy of the ESA was submitted, it did not mean that said
foreign law could be automatically applied to this case. The petitioners
miserably failed to adhere to the two other requisites, which shall be
discussed in seratim.
The foreign law was not
expressly specified in the
employment contract
The petitioners failed to comply with the first requisite because
no foreign law was expressly stipulated in the overseas employment
contract with Arriola. In its pleadings, the petitioners did not directly cite
any specific provision or stipulation in the said labor contract which
indicated the applicability of the Canadian labor laws or the ESA. They
failed to show on the face of the contract that a foreign law was agreed
upon by the parties. Rather, they simply asserted that the terms and
conditions of Arriola's employment were embodied in the Expatriate
Policy, Ambatovy Project-Site, Long Term. 45 Then, they emphasized
provision 8.20 therein, regarding interpretation of the contract, which
provides that said policy would be governed and construed with the laws
of the country where the applicable SNC-Lavalin, Inc. office was
located. 46 Because of this provision, the petitioners insisted that the
laws of Canada, not of Madagascar or the Philippines, should apply.
Then, they finally referred to the ESA. DcHSEa
It is apparent that the petitioners were simply attempting to
stretch the overseas employment contract of Arriola, by implication, in
order that the alleged foreign law would apply. To sustain such argument
would allow any foreign employer to improperly invoke a foreign law even
if it is not anymore reasonably contemplated by the parties to control the
overseas employment. The OFW, who is susceptible by his desire and
desperation to work abroad, would blindly sign the labor contract even
though it is not clearly established on its face which state law shall apply.
Thus, a better rule would be to obligate the foreign employer to expressly
declare at the onset of the labor contract that a foreign law shall govern
it. In that manner, the OFW would be informed of the applicable law
before signing the contract.
Further, it was shown that the overseas labor contract was
executed by Arriola at his residence in Batangas and it was processed at
the POEA on May 26, 2008. 47 Considering that no foreign law was
specified in the contract and the same was executed in the Philippines,
the doctrine of lex loci celebrationis applies and the Philippine laws shall
govern the overseas employment of Arriola.
The foreign law invoked is
contrary to the  Constitution
and the Labor Code
Granting arguendo that the labor contract expressly stipulated
the applicability of Canadian law, still, Arriola's employment cannot be
governed by such foreign law because the third requisite is not satisfied.
A perusal of the ESA will show that some of its provisions are contrary to
the Constitution and the labor laws of the Philippines.
First, the ESA does not require any ground for the early
termination of employment. 48 Article 54 thereof only provides that no
employer should terminate the employment of an employee unless a
written notice had been given in advance. 49 Necessarily, the employer
can dismiss any employee for any ground it so desired. At its own
pleasure, the foreign employer is endowed with the absolute power to
end the employment of an employee even on the most whimsical
grounds.
Second, the ESA allows the employer to dispense with the prior
notice of termination to an employee. Article 65 (4) thereof indicated that
the employer could terminate the employment without notice by simply
paying the employee a severance pay computed on the basis of the
period within which the notice should have been given. 50 The employee
under the ESA could be immediately dismissed without giving him the
opportunity to explain and defend himself.
The provisions of the ESA are patently inconsistent with the right
to security of tenure. Both the Constitution 51 and the Labor
Code 52 provide that this right is available to any employee. In a host of
cases, the Court has upheld the employee's right to security of tenure in
the face of oppressive management behavior and management
prerogative. Security of tenure is a right which cannot be denied on mere
speculation of any unclear and nebulous basis. 53
Not only do these provisions collide with the right to security of
tenure, but they also deprive the employee of his constitutional right to
due process by denying him of any notice of termination and the
opportunity to be heard. 54 Glaringly, these disadvantageous provisions
under the ESA produce the same evils which the Court vigorously sought
to prevent in the cases of Pakistan International and Sameer Overseas.
Thus, the Court concurs with the CA that the ESA is not applicable in this
case as it is against our fundamental and statutory laws.
In fine, as the petitioners failed to meet all the four (4) requisites
on the applicability of a foreign law, then the Philippine labor laws must
govern the overseas employment contract of Arriola.
No authorized cause for
dismissal was proven
Article 279 of our Labor Code has construed security of tenure to
mean that the employer shall not terminate the services of an employee
except for a just cause or when authorized by law. 55 Concomitant to the
employer's right to freely select and engage an employee is the
employer's right to discharge the employee for just and/or authorized
causes. To validly effect terminations of employment, the discharge must
be for a valid cause in the manner required by law. The purpose of these
two-pronged qualifications is to protect the working class from the
employer's arbitrary and unreasonable exercise of its right to dismiss. 56
Some of the authorized causes to terminate employment under
the Labor Code would be installation of labor-saving devices,
redundancy, retrenchment to prevent losses and the closing or cessation
of operation of the establishment or undertaking. 57 Each authorized
cause has specific requisites that must be proven by the employer with
substantial evidence before a dismissal may be considered valid.
Here, the petitioners assert that the economy of Madagascar
weakened due to the global financial crisis. Consequently, SNC-Lavalin's
business also slowed down. To prove its sagging financial standing,
SNC-Lavalin presented a copy of a news item in the Financial Post,
dated March 5, 2009. They insist that SNC-Lavalin had no choice but to
minimize its expenditures and operational expenses. 58 In addition, the
petitioners argued that the government of Madagascar prioritized the
employment of its citizens, and not foreigners. Thus, Arriola was
terminated because there was no more job available for him. 59
The Court finds that Arriola was not validly dismissed. The
petitioners simply argued that they were suffering from financial losses
and Arriola had to be dismissed. It was not even clear what specific
authorized cause, whether retrenchment or redundancy, was used to
justify Arriola's dismissal. Worse, the petitioners did not even present a
single credible evidence to support their claim of financial loss. They
simply offered an unreliable news article which deserves scant
consideration as it is undoubtedly hearsay. Time and again the Court has
ruled that in illegal dismissal cases like the present one, the onus of
proving that the employee was dismissed and that the dismissal was not
illegal rests on the employer, and failure to discharge the same would
mean that the dismissal is not justified and, therefore, illegal. 60 SCaITA
As to the amount of backpay awarded, the Court finds that the [G.R. No. 161757. January 25, 2006.]
computation of the CA was valid and proper based on the employment
contract of Arriola. Also, the issue of whether the petitioners had made
SUNACE INTERNATIONAL MANAGEMENT SERVICES,
partial payments on the backpay is a matter best addressed during the
INC.,  petitioner, vs. NATIONAL LABOR RELATIONS
execution process.
COMMISSION, Second Division; HON. ERNESTO S.
WHEREFORE, the petition is DENIED. The January 24, 2013 DINOPOL, in his capacity as Labor Arbiter, NLRC;
Decision of the Court of Appeals in CA-G.R. SP No. 118869 NCR, Arbitration Branch, Quezon City and DIVINA A.
is AFFIRMED in toto. MONTEHERMOZO,  respondents.
SO ORDERED.
Gaspar V. Tagalo for petitioner.
The Solicitor General  for public respondents.
 Neva B. Biancaver  for private respondent.
SYLLABUS
1. CIVIL LAW; OBLIGATIONS AND CONTRACTS;
CONTRACTS ARE BINDING ONLY TO PARTIES OR THOSE PRIVY
THERETO; CASE AT BAR. — The finding of the Court of Appeals solely
on the basis of the above-quoted telefax message, that Sunace
continually communicated with the foreign "principal" (sic) and therefore
was aware of and had consented to the execution of the extension of the
contract is misplaced. The message does not provide evidence that
Sunace was privy to the new contract executed after the expiration on
February 1, 1998 of the original contract. That Sunace and the
Taiwanese broker communicated regarding Divina's allegedly withheld
savings does not necessarily mean that Sunace ratified the extension of
the contract. . . . There being no substantial proof that Sunace knew of
and consented to be bound under the 2-year employment contract
extension, it cannot be said to be privy thereto. As such, it and its
"owner" cannot be held solidarily liable for any of Divina's claims arising
from the 2-year employment extension as [Article 1311 of the] New Civil
Code provides.
2. ID.; SPECIAL CONTRACTS; AGENCY, IMPLIEDLY
REVOKED WHEN THE PRINCIPAL DIRECTLY MANAGES THE
BUSINESS ENTRUSTED TO THE AGENT AND DEALS DIRECTLY
WITH THIRD PERSONS; CASE AT BAR. — As Sunace correctly points
out, there was an implied revocation of its agency relationship with its
foreign principal when, after the termination of the original employment
contract, the foreign principal directly negotiated with Divina and entered
into a new and separate employment contract in Taiwan. Article 1924 of
the New Civil Code reading "the agency is revoked if the principal directly
manages the business entrusted to the agent, dealing directly with third
persons," thus applies.
DECISION
CARPIO MORALES, J  p:
Petitioner, Sunace International Management Services (Sunace),
a corporation duly organized and existing under the laws of the
Philippines, deployed to Taiwan Divina A. Montehermozo (Divina) as a
domestic helper under a 12-month contract effective February 1,
1997. 1 The deployment was with the assistance of a Taiwanese broker,
Edmund Wang, President of Jet Crown International Co., Ltd.
After her 12-month contract expired on February 1, 1998, Divina
continued working for her Taiwanese employer, Hang Rui Xiong, for two
more years, after which she returned to the Philippines on February 4,
2000.
Shortly after her return or on February 14, 2000, Divina filed a
complaint 2 before the National Labor Relations Commission (NLRC)
against Sunace, one Adelaide Perez, the Taiwanese broker, and the
employer-foreign principal alleging that she was jailed for three months
and that she was underpaid.
The following day or on February 15, 2000, Labor Arbitration
Associate Regina T. Gavin issued Summons 3 to the Manager of
Sunace, furnishing it with a copy of Divina's complaint and directing it to
appear for mandatory conference on February 28, 2000.
The scheduled mandatory conference was reset. It appears to
have been concluded, however.
On April 6, 2000, Divina filed her Position Paper 4 claiming that
under her original one-year contract and the 2-year extended contract
which was with the knowledge and consent of Sunace, the following
amounts representing income tax and savings were deducted:
Year Deduction for Deduction for Savings
  Income Tax  
     
1997 NT10,450.00 NT23,100.00
1998 NT9,500.00 NT36,000.00
1999 NT13,300.00 NT36,000.00; 5
and while the amounts deducted in 1997 were refunded to her, those
deducted in 1998 and 1999 were not. On even date, Sunace, by its
Proprietor/General Manager Maria Luisa Olarte, filed its Verified Answer
and Position Paper, 6 claiming as follows, quoted verbatim:
COMPLAINANT IS NOT ENTITLED
FOR THE REFUND OF HER 24 MONTHS
SAVINGS
3.Complainant could not anymore claim nor
entitled for the refund of her 24 months savings as she
already took back her saving already last year and the
employer did not deduct any money from her salary, in
accordance with a Fascimile Message from the
respondent SUNACE's employer, Jet Crown International
Co. Ltd., a xerographic copy of which is herewith attached
as ANNEX "2" hereof;
 COMPLAINANT IS NOT ENTITLED
TO REFUND OF HER 14 MONTHS TAX
AND PAYMENT OF ATTORNEY'S FEES
4.There is no basis for the grant of tax refund to
the complainant as the she finished her  one year
contract and hence, was not illegally dismissed by her
employer. She could only lay claim over the tax refund or
much more be awarded of damages such as attorney's
fees as said reliefs are available only when the dismissal
of a migrant worker is without just valid or lawful cause as
defined by law or contract.
The rationales behind the award of tax refund and
payment of attorney's fees is not to enrich the complainant
but to compensate him for actual injury suffered.
Complainant did not suffer injury, hence, does not deserve
to be compensated for whatever kind of damages. ACTIHa
Hence, the complainant has NO cause of action
against respondent SUNACE for monetary claims,
considering that she has been totally paid of all the
monetary benefits due her under her Employment
Contract to her full satisfaction.
6.Furthermore, the tax deducted from her salary is
in compliance with the Taiwanese law, which respondent
SUNACE has no control and complainant has to obey and
this Honorable Office has no authority/jurisdiction to
intervene because the power to tax is a sovereign power
which the Taiwanese Government is supreme in its own
territory. The sovereign power of taxation of a state is
recognized under international law and among sovereign
states.
7.That respondent SUNACE respectfully reserves
the right to file supplemental Verified Answer and/or
Position Paper to substantiate its prayer for the dismissal
of the above case against the herein respondent. AND BY
WAY OF —
xxx xxx xxx (Emphasis and underscoring supplied)
Reacting to Divina's Position Paper, Sunace filed on April 25,
2000 an ". . . ANSWER TO COMPLAINANT'S POSITION
PAPER" 7 alleging that Divina's 2-year extension of her contract was
without its knowledge and consent, hence, it had no liability attaching to
any claim arising therefrom, and Divina in fact executed a
Waiver/Quitclaim and Release of Responsibility and an Affidavit of
Desistance, copy of each document was annexed to said ". . . ANSWER
TO COMPLAINANT'S POSITION PAPER."
To Sunace's ". . . ANSWER TO COMPLAINANT'S POSITION
PAPER," Divina filed a 2-page reply, 8 without, however, refuting
Sunace's disclaimer of knowledge of the extension of her contract and
without saying anything about the Release, Waiver and Quitclaim and
Affidavit of Desistance.
The Labor Arbiter, rejected Sunace's claim that the extension of
Divina's contract for two more years was without its knowledge and
consent in this wise:
We reject Sunace's submission that it should not
be held responsible for the amount withheld because her
contract was extended for 2 more years without its
knowledge and consent because as Annex "B" 9 shows,
Sunace and Edmund Wang have not stopped
communicating with each other and yet the matter of the
contract's extension and Sunace's alleged non-consent
thereto has not been categorically established.
What Sunace should have done was to write to
POEA about the extension and its objection thereto, copy
furnished the complainant herself, her foreign employer,
Hang Rui Xiong and the Taiwanese broker, Edmund
Wang.
And because it did not, it is presumed to have
consented to the extension and should be liable for
anything that resulted thereform (sic). 10 (Underscoring
supplied)
The Labor Arbiter rejected too Sunace's argument that it is not
liable on account of Divina's execution of a Waiver and Quitclaim and an
Affidavit of Desistance. Observed the Labor Arbiter:
Should the parties arrive at any agreement as to
the whole or any part of the dispute, the same shall be
reduced to writing and signed by the parties and their
respective counsel (sic), if any, before the Labor Arbiter.
The settlement shall be approved by the Labor
Arbiter after being satisfied that it was voluntarily entered
into by the parties and after having explained to them the
terms and consequences thereof.
A compromise agreement entered into by the
parties not in the presence of the Labor Arbiter before
whom the case is pending shall be approved by him, if
 after confronting the parties, particularly the complainants,
he is satisfied that they understand the terms and
conditions of the settlement and that it was entered into
freely voluntarily (sic) by them and the agreement is not
contrary to law, morals, and public policy.
And because no consideration is indicated in the
documents, we strike them down as contrary to law,
morals, and public policy. 11
He accordingly decided in favor of Divina, by decision of October 9,
2000, 12 the dispositive portion of which reads:
Wherefore, judgment is hereby rendered ordering
respondents SUNACE INTERNATIONAL SERVICES and
its owner ADELAIDA PERGE, both in their personal
capacities and as agent of Hang Rui Xiong/Edmund
Wang to jointly and severally pay complainant DIVINA A.
MONTEHERMOZO the sum of NT91,950.00 in its peso
equivalent at the date of payment, as refund for the
amounts which she is hereby adjudged entitled to as
earlier discussed plus 10% thereof as attorney's fees since
compelled to litigate, complainant had to engage the
services of counsel.
SO ORDERED. 13 (Underscoring supplied)
On appeal of Sunace, the NLRC, by Resolution of April 30,
2002, 14 affirmed the Labor Arbiter's decision.
Via petition for certiorari, 15 Sunace elevated the case to the
Court of Appeals which dismissed it outright by Resolution of November
12, 2002, 16 the full text of which reads:
The petition for certiorari faces outright dismissal.
The petition failed to allege facts constitutive of
grave abuse of discretion on the part of the public
respondent amounting to lack of jurisdiction when the
NLRC affirmed the Labor Arbiter's finding that
petitioner Sunace International Management Services
impliedly consented to the extension of the contract of
private respondent Divina A. Montehermozo. It is
undisputed that petitioner was continually communicating
with private respondent's foreign employer (sic). As agent
of the foreign principal, "petitioner cannot profess
ignorance of such extension as obviously,  the act of the
principal extending complainant (sic) employment
contract necessarily bound it." Grave abuse of
discretion is not present in the case at bar.
ACCORDINGLY, the petition is hereby DENIED
DUE COURSE and DISMISSED. 17
SO ORDERED.
(Emphasis on words in capital letters in the
original; emphasis on words in small letters and
underscoring supplied)
Its Motion for Reconsideration having been denied by the appellate court
by Resolution of January 14, 2004, 18 Sunace filed the present petition
for review on certiorari.
The Court of Appeals affirmed the Labor Arbiter and NLRC's
finding that Sunace knew of and impliedly consented to the extension of
Divina's 2-year contract. It went on to state that "It is undisputed that
[Sunace] was continually communicating with [Divina's] foreign
employer." It thus concluded that "[a]s agent of the foreign principal,
'petitioner cannot profess ignorance of such extension as obviously, the
act of the principal extending complainant (sic) employment contract
necessarily bound it.'"
Contrary to the Court of Appeals finding, the alleged continuous
communication was with the Taiwanese broker Wang, not with the
foreign employer Xiong. DEICTS
The February 21, 2000 telefax message from the Taiwanese
broker to Sunace, the only basis of a finding of continuous
communication, reads verbatim:
xxx xxx xxx
Regarding to Divina, she did not say
anything about her saving in police station. As we
contact with her employer, she took back her
saving already last years. And they did not deduct
any money from her salary. Or she will call back
her employer to check it again. If her employer
said yes! we will get it back for her.
Thank you and best regards.
(sgd.)
Edmund Wang
President 19
The finding of the Court of Appeals solely on the basis of the
above-quoted telefax message, that Sunace continually communicated
with the foreign "principal" (sic) and therefore was aware of and had
consented to the execution of the extension of the contract is misplaced.
The message does not provide evidence that Sunace was privy to the foreign principal directly negotiated with Divina and entered into a new
new contract executed after the expiration on February 1, 1998 of the and separate employment contract in Taiwan. Article 1924 of the New
original contract. That Sunace and the Taiwanese broker communicated Civil Code reading
regarding Divina's allegedly withheld savings does not necessarily mean
The agency is revoked if the principal directly
that Sunace ratified the extension of the contract. As Sunace points out
manages the business entrusted to the agent, dealing
in its Reply 20 filed before the Court of Appeals,
directly with third persons.
As can be seen from that letter communication, it
was just an information given to the petitioner that the thus applies.
private respondent had t[aken] already her savings from In light of the foregoing discussions, consideration of the validity
her foreign employer and that no deduction was made on of the Waiver and Affidavit of Desistance which Divina executed in favor
her salary. It contains nothing about the extension or the of Sunace is rendered unnecessary.
petitioner's consent thereto. 21
WHEREFORE, the petition is GRANTED. The challenged
Parenthetically, since the telefax message is dated February 21, resolutions of the Court of Appeals are hereby REVERSED and SET
2000, it is safe to assume that it was sent to enlighten Sunace who had ASIDE. The complaint of respondent Divina A. Montehermozo against
been directed, by Summons issued on February 15, 2000, to appear on petitioner is DISMISSED.
February 28, 2000 for a mandatory conference following Divina's filing of
SO ORDERED.
the complaint on February 14, 2000.
Respecting the Court of Appeals following dictum:
As agent of its foreign principal, [Sunace] cannot
profess ignorance of such an extension as obviously, the
act of its principal extending [Divina's] employment
contract necessarily bound it, 22
it too is a misapplication, a misapplication of the theory of imputed
knowledge.
The theory of imputed knowledge ascribes the knowledge of the
agent, Sunace, to the principal, employer Xiong, not the other way
around. 23 The knowledge of the principal-foreign employer cannot,
therefore, be imputed to its agent Sunace.
There being no substantial proof that Sunace knew of and
consented to be bound under the 2-year employment contract extension,
it cannot be said to be privy thereto. As such, it and its "owner" cannot be
held solidarily liable for any of Divina's claims arising from the 2-year
employment extension. As the New Civil Code provides,
[G.R. No. 207010. February 18, 2015.]
Contracts take effect only between the parties,
their assigns, and heirs, except in case where the rights
MAERSK-FILIPINAS CREWING, INC., A.P. MOLLER
and obligations arising from the contract are not
SINGAPORE PTE. LIMITED, and JESUS
transmissible by their nature, or by stipulation or by
AGBAYANI, petitioners, vs. TORIBIO
provision of law. 24
C.  AVESTRUZ,  * respondent.
Furthermore, as Sunace correctly points out, there was an
implied revocation of its agency relationship with its foreign principal
when, after the termination of the original employment contract, the
DECISION
PERLAS-BERNABE, J  p:
Assailed in this petition for review on certiorari 1 are the
Decision 2 dated January 4, 2013 and the Resolution 3 dated April 16, 2013
rendered by the Court of Appeals (CA) in CA-G.R. SP No. 125773 which
reversed and set aside the Decision 4 dated April 26, 2012 and the
Resolution 5 dated June 18, 2012 of the National Labor Relations
Commission (NLRC) in NLRC NCR Case No. (M) 07-10704-11 [NLRC LAC
No. (OFW-M)-01-000123-12] dismissing the illegal dismissal complaint filed
by respondent Toribio C. Avestruz (Avestruz) and awarding him nominal
damages.
The Facts
On April 28, 2011, petitioner Maersk-Filipinas Crewing, Inc.
(Maersk), on behalf of its foreign principal, petitioner A.P. Moller Singapore
Pte. Ltd. (A.P. Moller), hired Avestruz as Chief Cook on board the
vessel M/V Nedlloyd Drake for a period of six (6) months, with a basic
monthly salary of US$698.00. 6 Avestruz boarded the vessel on May 4,
2011. 7
On June 22, 2011, in the course of the weekly inspection of the
vessel's galley, Captain Charles C. Woodward (Captain Woodward) noticed
that the cover of the garbage bin in the kitchen near the washing area was
oily. As part of Avestruz's job was to ensure the cleanliness of the galley,
Captain Woodward called Avestruz and asked him to stand near the garbage
bin where the former took the latter's right hand and swiped it on the oily
cover of the garbage bin, telling Avestruz to feel it.
Shocked, Avestruz remarked, "Sir if you are looking for [dirt], you can find it[;]
the ship is big. Tell us if you want to clean and we will clean it." Captain
Woodward replied by shoving Avestruz's chest, to which the latter
complained and said, "Don't touch me," causing an argument to ensue
between them. 8
Later that afternoon, Captain Woodward summoned and
required 9 Avestruz to state in writing what transpired in the galley that
morning. Avestruz complied and submitted his written statement 10 on that
same day. Captain Woodward likewise asked Messman Jomilyn P. Kong
(Kong) to submit his own written statement regarding the incident, to which
the latter immediately complied. 11 On the very same day, Captain
Woodward informed Avestruz that he would be dismissed from service and
be disembarked in India. On July 3, 2011, Avestruz was disembarked in
Colombo, Sri Lanka and arrived in the Philippines on July 4, 2011. 12
Subsequently, he filed a complaint 13 for illegal dismissal, payment
for the unexpired portion of his contract, damages, and attorney's fees
against Maersk, A.P. Moller, and Jesus Agbayani (Agbayani), an
officer 14 of Maersk. 15 He alleged that no investigation or hearing was
conducted nor was he given the chance to defend himself before he was
dismissed, and that Captain Woodward failed to observe the provisions
under Section 17 of the Philippine Overseas Employment Administration
(POEA) Standard Employment Contract (POEA-SEC) on disciplinary
procedures. Also, he averred that he was not given any notice stating the
ground for his dismissal. 16 Additionally, he claimed that the cost of his
airfare in the amount of US$606.15 was deducted from his
wages. 17 Furthermore, Avestruz prayed for the award of the following
amounts: (a) US$5,372.00 representing his basic wages, guaranteed
overtime, and vacation leave; (b) on board allowance of
US$1,936.00; (c) ship maintenance bonus of US$292.00; (d) hardship
allowance of US$8,760.00; (e) P300,000.00 as moral
damages, (f) P200,000.00 as exemplary damages; and (g) attorney's fees of
ten percent (10%) of the total monetary award. 18
In their defense, 19 Maersk, A.P. Moller, and Agbayani (petitioners)
claimed that during his stint on the vessel, Avestruz failed to attend to his
tasks, specifically to maintain the cleanliness of the galley, which prompted
Captain Woodward to issue weekly reminders. 20 Unfortunately, despite the
reminders, Avestruz still failed to perform his duties properly. 21 On June 22,
2011, when again asked to comply with the aforesaid duty, Avestruz became
angry and snapped, retorting that he did not have time to do all the tasks
required of him. As a result, Captain Woodward initiated disciplinary
proceedings and informed Avestruz during the hearing of the offenses he
committed, i.e., his repeated failure to follow directives pertaining to his duty
to maintain the cleanliness of the galley, as well as his act of insulting an
officer. 22 Thereafter, he was informed of his dismissal from service due to
insubordination. 23 Relative thereto, Captain Woodward sent two (2)
electronic mail messages 24 (e-mails) to Maersk explaining the decision to
terminate Avestruz's employment and requesting for Avestruz's
replacement. Avestruz was discharged from the vessel and arrived in the
Philippines on July 4, 2011. 25
Petitioners maintained that Avestruz was dismissed for a just and
valid cause and is, therefore, not entitled to recover his salary for the
unexpired portion of his contract. 26 They likewise claimed that they were
justified in deducting his airfare from his salary, and that the latter was not
entitled to moral and exemplary damages and attorney's fees. 27 Hence,
they prayed that the complaint be dismissed for lack of merit. 28
The LA Ruling
In a Decision 29 dated November 29, 2011, the Labor Arbiter (LA)
dismissed Avestruz's complaint for lack of merit. The LA found that he failed
to perform his duty of maintaining cleanliness in the galley, and that he also
repeatedly failed to obey the directives of his superior, which was tantamount
to insubordination. 30 In support of its finding, the LA cited the Collective
Bargaining Agreement 31 (CBA) between the parties which considers the act
of insulting a superior officer by words or deed as an act of
insubordination. 32 acTDCI
Aggrieved, Avestruz appealed 33 to the NLRC.
The NLRC Ruling
In a Decision 34 dated April 26, 2012, the NLRC sustained the
validity of Avestruz's dismissal but found that petitioners failed to observe the
procedures laid down in Section 17 of the POEA-SEC, 35 which states:
SECTION 17. DISCIPLINARY PROCEDURES. —
The Master shall comply with the following disciplinary
procedures against an erring seafarer:
A. The Master shall furnish the seafarer with a written
notice containing the following:
1. Grounds for the charges as listed in Section
33 of this Contract or analogous act
constituting the same.
2. Date, time and place for a formal
investigation of the charges against the
seafarer concerned.
B. The Master or his authorized representative shall
conduct the investigation or hearing, giving
the seafarer the opportunity to explain or
defend himself against the charges. These
procedures must be duly documented and
entered into the ship's logbook.
C. If after the investigation or hearing, the Master is
convinced that imposition of a penalty is justified,
the Master shall issue a written notice of penalty
and the reasons for it to the seafarer, with
copies furnished to the Philippine agent.
D. Dismissal for just cause may be effected by the Master
without furnishing the seafarer with a notice of
dismissal if there is a clear and existing danger to
the safety of the crew or the vessel. The Master
shall send a complete report to the manning
agency substantiated by witnesses, testimonies
and any other documents in support thereof.
(Emphases supplied)
As the records are bereft of evidence showing compliance with the
foregoing rules, the NLRC held petitioners jointly and severally liable to
pay Avestruz the amount of P30,000.00 by way of nominal damages. 36
Avestruz moved for reconsideration 37 of the aforesaid Decision,
which was denied in the Resolution 38 dated June 18, 2012. Dissatisfied, he
elevated the matter to the CA via petition for certiorari. 39
The CA Ruling
In a Decision 40 dated January 4, 2013, the CA reversed and set
aside the rulings of the NLRC and instead, found Avestruz to have been
illegally dismissed. Consequently, it directed petitioners to pay him, jointly
and severally, the full amount of his placement fee and deductions made,
with interest at twelve percent (12%) per annum, as well as his salaries for
the unexpired portion of his contract, and attorney's fees of ten percent (10%)
of the total award. All other money claims were denied for lack of merit. 41
In so ruling, the CA found that the conclusion of the NLRC, which
affirmed that of the LA, that Avestruz was lawfully dismissed, was not
supported by substantial evidence, there being no factual basis for the
charge of insubordination which petitioners claimed was the ground
for Avestruz's dismissal. It found that petitioners, as employers, were unable
to discharge the burden of proof required of them to establish
that Avestruz was guilty of insubordination, which necessitates the
occurrence of two (2) conditions as a just cause for dismissal: (1) the
employee's assailed conduct must have been willful, that is, characterized by
a wrongful and perverse attitude; and (2) the order violated must have been
reasonable, lawful, made known to the employee, and must pertain to the
duties which he had been engaged to discharge. The CA found that, contrary
to the rulings of the labor tribunals, there was no evidence on record to
bolster petitioners' claims that Avestruz willfully failed to comply with his
duties as Chief Cook and that he displayed a perverse and wrongful
attitude. 42
Moreover, it gave more credence to Avestruz's account of the
incident in the galley on June 22, 2011, being supported in part by the
statement 43 of Kong, who witnessed the incident. On the other hand, the e-
mails sent by Captain Woodward to Maersk were uncorroborated. On this
score, the CA observed the absence of any logbook entries to support
petitioners' stance. 44
Similarly, the CA found that petitioners failed to accord procedural
due process to Avestruz, there being no compliance with the requirements of
Section 17 of the POEA-SEC as above-quoted, or the "two-notice rule." It
held that the statement 45 Captain Woodward issued to Avestruz neither
contained the grounds for which he was being charged nor the date, time,
and place for the conduct of a formal investigation. Likewise, Captain
Woodward failed to give Avestruz any notice of penalty and the reasons for
its imposition, with copies thereof furnished to the Philippine Agent. 46
In arriving at the monetary awards given to Avestruz, the CA
considered the provisions of Section 7 of Republic Act No. (RA)
10022, 47 amending RA 8042, 48 which grants upon the illegally dismissed
overseas worker "the full reimbursement [of] his placement fee and the
deductions made with interest at twelve percent (12%) per annum, plus his
salaries for the unexpired portion of his employment contract." However, with
respect to Avestruz's claims for overtime and leave pay, the same were
denied for failure to show entitlement thereto. All other monetary claims were
likewise denied in the absence of substantial evidence to prove the same.
Finally, the CA awarded attorney's fees of ten percent (10%) of the total
monetary award in accordance with Article 111 49 of the Labor
Code.50 aHcACT
Petitioners moved for reconsideration, 51 which the CA denied in its
Resolution 52 dated April 16, 2013, hence, this petition.
The Issue Before the Court
The sole issue advanced for the Court's resolution is whether or not
the CA erred when it reversed and set aside the ruling of the NLRC finding
that Avestruz was legally dismissed and accordingly, dismissing the
complaint, albeit with payment of nominal damages for violation of procedural
due process.
The Court's Ruling
The petition is devoid of merit.
Generally, a re-examination of factual findings cannot be done by the
Court acting on a petition for review on certiorari because the Court is not a
trier of facts but reviews only questions of law. 53 Thus, in petitions for
review on certiorari, only questions of law may generally be put into issue.
This rule, however, admits of certain exceptions. 54 In this case, considering
that the factual findings of the LA and the NLRC, on the one hand, and the
CA, on the other hand, are contradictory, the general rule that only legal
issues may be raised in a petition for review on certiorari under Rule 45 of
the Rules of Court does not apply, 55 and the Court retains the authority to
pass upon the evidence presented and draw conclusions therefrom. 56
It is well-settled that the burden of proving that the termination of an
employee was for a just or authorized cause lies with the employer. If the
employer fails to meet this burden, the conclusion would be that the
dismissal was unjustified and, therefore, illegal. 57 In order to discharge this
burden, the employer must present substantial evidence, which is defined as
that amount of relevant evidence which a reasonable mind might accept as
adequate to justify a conclusion, 58 and not based on mere surmises or
conjectures. 59
After a punctilious examination of the evidence on record, the Court
finds that the CA did not err in reversing and setting aside the factual
conclusions of the labor tribunals that Avestruz's dismissal was lawful.
Instead, the Court finds that there was no just or valid cause for his
dismissal, hence, he was illegally dismissed.
Petitioners maintain that Avestruz was dismissed on the ground of
insubordination, consisting of his "repeated failure to obey his superior's
order to maintain cleanliness in the galley of the vessel" as well as his act of
"insulting a superior officer by words or deeds." 60 In support of this
contention, petitioners presented as evidence the e-mails sent by Captain
Woodward, both dated June 22, 2011, and time-stamped 10:07 a.m. and
11:40 a.m., respectively, which they claim chronicled the relevant
circumstances that eventually led to Avestruz's dismissal.
The Court, however, finds these e-mails to be uncorroborated and
self-serving, and therefore, do not satisfy the requirement of substantial
evidence as would sufficiently discharge the burden of proving
that Avestruz was legally dismissed. On the contrary, petitioners failed to
prove that he committed acts of insubordination which would warrant his
dismissal.
Insubordination, as a just cause for the dismissal of an employee,
necessitates the concurrence of at least two requisites: (1) the employee's
assailed conduct must have been willful, that is, characterized by a wrongful
and perverse attitude; and (2) the order violated must have been reasonable,
lawful, made known to the employee, and must pertain to the duties which he
had been engaged to discharge. 61
In this case, the contents of Captain Woodward's e-mails do not
establish that Avestruz's conduct had been willful, or characterized by a
wrongful and perverse attitude. The Court concurs with the CA's observation
that Avestruz's statement 62 regarding the incident in the galley deserves
more credence, being corroborated 63 by Kong, a messman who witnessed
the same.
Conversely, apart from Captain Woodward's e-mails, no other
evidence was presented by the petitioners to support their claims. While
rules of evidence are not strictly observed in proceedings before
administrative bodies, 64 petitioners should have offered additional proof to
corroborate the statements 65 described therein. Thus, in Ranises  v.
NLRC 66 which involved a seafarer who was repatriated to the Philippines
for allegedly committing illegal acts amounting to a breach of trust, as based
on a telex dispatch by the Master of the vessel, the Court impugned and
eventually vetoed the credence given by the NLRC upon the telex, to
wit: cCEAHT
Unfortunately, the veracity of the allegations
contained in the aforecited telex was never proven by
 respondent employer. Neither was it shown that
respondent employer exerted any effort to even verify the
truthfulness of Capt. Sonoda's report and establish
petitioner's culpability for his alleged illegal acts. Worse, no
other evidence was submitted to corroborate the charges
against petitioner. 67
Likewise, in Skippers United Pacific,  Inc.  v. NLRC, 68 the Court
ruled that the lone evidence offered by the employer to justify the seafarer's
dismissal, i.e., the telexed Chief Engineer's Report which contained the
causes for said dismissal, did not suffice to discharge the onus required of
the employer to show that the termination of an employee's service was
valid. 69 The same doctrine was enunciated in Pacific Maritime
Services,  Inc.  v. Ranay, 70 where the Court held that the telefax
transmission purportedly executed and signed by a person on board the
vessel is insufficient evidence to prove the commission of the acts
constituting the grounds for the dismissal of two seafarers, being
uncorroborated evidence. 71
As in this case, it was incumbent upon the petitioners to present
other substantial evidence to bolster their claim that Avestruz committed acts
that constitute insubordination as would warrant his dismissal. At the least,
they could have offered in evidence entries in the ship's official logbook
showing the infractions or acts of insubordination purportedly committed
by Avestruz, the ship's logbook being the official repository of the day-to-day
transactions and occurrences on board the vessel. 72 Having failed to do so,
their position that Avestruz was lawfully dismissed cannot be sustained.
Similarly, the Court affirms the finding of the CA that Avestruz was
not accorded procedural due process, there being no compliance with the
provisions of Section 17 of the POEA-SEC as above-cited, which requires
the "two-notice rule." As explained in Skippers Pacific,  Inc.  v. Mira: 73
An erring seaman is given a written notice of the charge
against him and is afforded an opportunity to explain or
defend himself. Should sanctions be imposed, then a
written notice of penalty and the reasons for it shall be
furnished the erring seafarer. It is only in the exceptional
case of clear and existing danger to the safety of the
crew or vessel that the required notices are dispensed
with; but just the same, a complete report should be sent
to the manning agency, supported by substantial
evidence of the findings. 74
In this case, there is dearth of evidence to show that Avestruz had
been given a written notice of the charge against him, or that he was given
the opportunity to explain or defend himself. The statement 75 given by
Captain Woodward requiring him to explain in writing the events that
transpired at the galley in the morning of June 22, 2011 hardly qualifies as a
written notice of the charge against him, nor was it an opportunity
for Avestruz to explain or defend himself. While Captain Woodward claimed
in his e-mail 76 that he conducted a "disciplinary hearing"
informing Avestruz of his inefficiency, no evidence was presented to support
the same.
Neither was Avestruz given a written notice of penalty and the
reasons for its imposition. Instead, Captain Woodward verbally informed him
that he was dismissed from service and would be disembarked from the
vessel. It bears stressing that only in the exceptional case of clear and
existing danger to the safety of the crew or vessel that the required notices
may be dispensed with, and, once again, records are bereft of evidence
showing that such was the situation when Avestruz was dismissed.
Finally, with respect to the monetary awards given to Avestruz, the
Court finds the same to be in consonance with Section 10 of RA 8042, as
amended by RA 10022, which reads:
Section 10. Money claims. — . . . .
xxx xxx xxx
In case of termination of overseas employment
without just, valid or authorized cause as defined by law or
contract, or any unauthorized deductions from the migrant
worker's salary, the worker shall be entitled to the full
reimbursement of his placement fee and the deductions
made with interest at twelve percent (12%) per annum,
plus his salaries for the unexpired portion of his
employment contract or for three (3) months for every year
of the unexpired term, whichever is less. 76
xxx xxx xxx
Similarly, the Court affirms the grant of attorney's fees of ten percent
(10%) of the total award. All other monetary awards are denied for lack of
merit.
WHEREFORE, the petition is DENIED. The Decision dated January
4, 2013 and the Resolution dated April 16, 2013 rendered by the Court of
Appeals in CA-G.R. SP No. 125773 are hereby AFFIRMED.
SO ORDERED