G.R. No. 124439.
 February 5, 2004.* executed as an afterthought. As held in the case of People v. Ubiña,“it would be a
PEOPLE OF THE PHILIPPINES, appellee, vs. FLOR GUTIERREZ Y
TIMOD, appellant.
Criminal Law; Labor Law; Illegal Recruitment; Recruitment and placement
defined.—Illegal recruitment is committed when two elements concur, namely: (1)
the offender has no valid license or authority required by law to enable one to
lawfully engage in recruitment and placement of workers; and (2) he undertakes
either any activity within the meaning of 
_______________
22
 Loyao, Jr. v. Armecin, A.M. No. P-99-1329, 1 August 2000, 337 SCRA 37.
*
 SECOND DIVISION.
33
VOL. 422, FEBRUARY 5, 2004  33        Juanito P. Noel for accused-appellant.
People vs. Gutierrez
“recruitment and placement” defined under Art. 13(b), or any of the prohibited
practices enumerated under Art. 34 of the Labor Code. Art. 13(b) of the Labor Code
defines “recruitment and placement” as “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.”
Same; Same; Same; The crime becomes Illegal Recruitment in Large Scale
when the two elements concur, with the addition of a third element: the recruiter
committed the same against three or more persons, individually or as a group.—The
crime becomes Illegal Recruitment in Large Scale when the two elements concur,
with the addition of a third element: the recruiter committed the same against three or
more persons, individually or as a group.
Same; Same; Same; Recruitment and placement activities of agents or
representatives appointed by a licensee, whose appointments were not authorized by
the Administration shall likewise constitute illegal recruitment.—Section 1, Rule X
of the same Book, in turn, provides that “recruitment and placement activities of
agents or representatives appointed by a licensee, whose appointments were not
authorized by the Administration shall likewise constitute illegal recruitment.”
Same; Same; Same; Illegal recruitment in large scale is malum pro-hibitum,
not malum in se; Good faith is not a defense.—Appellant cannot escape liability by
claiming that she was not aware that before working for her employer in the
recruitment agency, she should first be registered with the POEA. Illegal recruitment
in large scale is malum prohibitum, not malum in se.Good faith is not a defense.
Same; Same; Same; Evidence; Court attaches no persuasive value to
affidavits of desistance, especially when executed as an afterthought.—The
Affidavits of Desistance executed by two of the complainants deserve little weight.
The Court attaches no persuasive value to affidavits of desistance, especially when
dangerous rule for courts to reject testimonies solemnly taken before the courts of
justice simply because the witnesses who had given them later on changed their mind
for one reason or another; for such role would make solemn trials a mockery and
place the investigation of truth at the mercy of unscrupulous witnesses.”
34
34  SUPREME COURT REPORTS ANNOTATED 
People vs. Gutierrez
APPEAL from a decision of the Regional Trial Court of Pasay City, Br. 108.
The facts are stated in the opinion of the Court.
      The Solicitor General for plaintiff-appellee.
TlNGA, J.:
In its decision dated 22 March 1996, the Regional Trial Court (RTC) of Pasay City,
Branch 1081 found accused Flor Gutierrez y Timod guilty beyond reasonable doubt
of Illegal Recruitment in Large Scale and sentenced her to suffer the penalty of life
imprisonment and to pay a fine of P100,000.00.
The Information in Criminal Case No. 95-6796 reads as follows:
That from the months of April to August 1994 in Pasay City, Philippines, and within
the jurisdiction of this Honorable Court, accused FLOR GUTIERREZ Y TIMOD
conspiring and confederating with CECILIA BAUTISTA, ESTHER GAMILDE,
LINDA RABAINO and MARILYN GARCIA (whose present whereabouts are
unknown) and mutually helping one another, acting in common accord, did then and
there, willfully, unlawfully and feloniously, engage in recruitment activities for
overseas job placement and actually contract, enlist and recruit EVELYN V.
RAMOS, ROSEMARIE I. TUGADE, GENEROSA G. ASUNCION and ROSALYN
B. SUMAYO as domestic helpers in Dubai, United Arab Emirates, for a fee of
various amounts ranging from P10,000.00 to P15,000.00 each, without first
obtaining the required license and/or authority from the Philippine Overseas
Employment Administration (POEA).
CONTRARY TO LAW.2
Arraigned on April 24, 1995, the accused entered a plea of not guilty. The version of
the prosecution is as follows:
1
On April 18, 1994, Rosemarie Tugade went to the house of one Celia Bautista, a
"recruiter-agent" of the accused, at Brgy. Bulala, Vigan, Ilocos Sur.3 Celia told
Rosemarie that she had to submit the following requirements for her application to
work in Dubai as a domestic helper: P4,000.00 as placement fee, P1,200.00 for
passport, P850.00 for "medical," six (6) 2x2 pictures and her original birth
certificate.4
The next day, Rosemarie, together with "recruiter-agent" Celia Bautista and fellow
applicant Evelyn Ramos, traveled to Manila to the house of one Esther Gamilde,
another of the accused's "recruiter-agents."5 There, Rosemarie and Evelyn filled out
their bio-data forms. The two then underwent a medical examination before having
their whole-body picture taken. Esther told them that they would know the results of
their application from Celia.6
Two weeks later, Celia told Rosemarie that her application for Dubai was already
approved and that she will be receiving $150.00-dollars per month. For the first three
(3) months, however, there will be salary deductions.7
On August 27, 1994, Rosemarie and Evelyn, along with Celia and Esther, went to the
accused's office at Sarifudin Manpower and General Services at EDSA Extension,
Pasay City.8 The accused told Rosemarie that she needed to pay P2,000.00
more.9 The accused said she had received all of Rosemarie's documents and the
money paid to Celia.10 Trusting in Celia, Rosemarie did not demand a receipt from
the accused.
On August 31, 1994, the accused asked Rosemarie to give P500.00 as terminal fee
for her departure in a week's time.11 Rosemarie paid the amount, as evidenced by a
receipt.12 The scheduled departure did not push through, however. Instead,
Rosemarie was told that she was to leave on September 15, 1994, but, again, this did
not materialize.13 A series of postponements followed until finally she was told that
she would be leaving before Christmas 1994. Almost predictably, her trip never
came to pass.14
Private complainant Evelyn Ramos was with Rosemarie when she went to Celia
Bautista's house on April 19, 1994.15 Celia told Evelyn that for P4,000.00 she could
leave for Dubai to work as a domestic helper.16 Like Rosemarie, Evelyn gave all her
documents and paid the fees to Celia, who in turn handed them to Esther Gamilde in
Tondo.17 On June 10, 1994, Ramos gave Bautista P8,000.00, which was also turned
over to Gamilde.18
On August 22, 1994, Celia told Evelyn that she only had to wait one more week
before she left for Dubai.19 On August 27, 1994, Esther brought Evelyn to the
accused's office,20 where the accused asked for an additional P2,000.00 as processing
fee for the Philippine Overseas Employment Agency (POEA).21 Evelyn paid the
amount on August 31, 1994,22 including a terminal fee of P500.00. Like Rosemarie,
Evelyn was not able to leave the country despite the accused's promises.
Another complainant, Rosalyn D. Sumayo, also applied for overseas job placement
as a domestic helper in Dubai. Her experience was more agonizing. In her case, it
was one Marilyn Garcia who assisted Rosalyn.23 She submitted a copy of her birth
certificate, six (6) copies of 2 x 2 pictures, two (2) copies of her whole-body picture,
passport, and medical certificate.24 Marilyn also asked Rosalyn to pay: a processing
fee of P7,500.00, P2,620.00 as full tax, P500.00 as terminal fee, and P3,000.00 as
service charge.25
All the documents and money given by Rosalyn to Marilyn were subsequently
remitted to the accused at her office on June 28, 1994.26 The accused told Rosalyn
that she would be leaving anytime, but after three months, Rosalyn's departure did
not push through.27
Despite the setback, the accused kept assuring Rosalyn that she would still be able to
leave.28 One time, the accused brought her to the airport and instructed her to hide in
the airport restroom.29 After fifteen minutes, the accused told her that they had to
leave the airport because "mahigpit sa immigration."30 On another occasion, the
accused directed Rosalyn to hide inside the Kayumanggi Restaurant for fifteen (15)
minutes.31 Nothing happened after, though, and they went home.
On November 14, 1994, Rosalyn was again at the airport.32 The accused warned her,
though, that if the Immigration Officer insisted on seeing her papers, it would be
better for her to leave.33 As directed, she left the airport when she was asked to
produce her documents.34
Exasperated, Rosalyn went to the accused's house and demanded the return of her
money and her documents. Instead of acceding to Rosalyn's demands, the accused
shouted at her and warned her that she had to pay a cancellation fee of
$300.00.35 Rosalyn was not able to give the amount so she stayed with the accused,
who assured her that she would still be able to leave the country and that she would
receive a monthly salary of $150 to $200.36 These promises were never fulfilled.
Rosalyn thus went to the POEA, where POEA Administrator Felicisimo Joson, Jr.
informed her that the accused did not have a license to recruit.37
Generosa Asuncion suffered the same fate as her co-applicants. In August 1994, she
applied for overseas job placement with one Linda Rabaino.38 Generosa submitted
her passport, medical certificate, clearance from the National Bureau of Investigation
(NBI), birth certificate, bio-data and pictures.39 She also paid P15,000.00 in two
installments on September 9 and 12, 1994,40 which payments were not receipted.
2
Linda told Generosa she would be leaving on September 13, 1994.41 However, she
was not able to leave because, according to Linda, at 25, Generosa was under-aged.42
Linda then referred Generosa to the accused in the latter's office, where Linda turned
over Generosa's documents as well as the P15,000 00 to the accused.43 The accused
promised that Linda would be able to leave, but her departure never took
place.44 When Generosa demanded the return of her money and her documents, the
accused told her that she had to pay a cancellation fee of $600.00.45 Stunned, Linda
just opted to await the further outcome of her application.46 Her waiting was all for
naught.
With the promises of jobs abroad unfulfilled, complainants decided to verify if the
accused was a licensed recruiter. Upon learning from the POEA that she was not so
licensed,47 they proceeded to the Philippine Anti-Crime Commission (PACC) to
execute their respective affidavits.48
SPO4 Johnny Marqueta investigated the women's complaint. He confirmed with the
POEA that the accused was not licensed or authorized to recruit overseas contract
workers.49 The four complainants also informed him that the accused wanted to meet
with the group on January 26, 1995.50 SPO4 Marqueta thus had their money, totaling
P2,000.00,51 marked at the National Bureau of Investigation (NBI) Forensic Section
for their entrapment operation.52
On January 26, 1995, the accused met with the four complainants at Jollibee,
Commonwealth Avenue, Quezon City. As soon as she finished counting the marked
money and wrapping it in Jollibee napkins, the accused was arrested. 53
In her defense, the accused claimed that as an "employee" of a duly licensed agency
who was tasked to recruit and offer job placements abroad, she could not be held
liable for illegal recruitment.54 She admitted that she had no authority to recruit in her
personal capacity,55 but that her authority emanated from a Special Power of
Attorney (SPA) and a Certification issued by a licensed agency.56
At the time complainants applied for overseas employment, the accused was
"employed" as a Marketing Directress of Sarifudin Manpower and General
Services,57 a duly licensed agency with License No. OS-91-LB-61193-NL issued by
the Department of Labor and Employment.58 A Special Power of Attorney (SPA)
from Sarifudin, dated May 1, 1994,59 states that she was authorized:
1. To negotiate, enter into business transactions for manpower supply
particularly in the Middle East countries;
2. For and in behalf of SARIFUDIN, MANPOWER AND GENERAL
SERVICES using as guidelines and terms and conditions by both parties to
secure:
(a) Verified Job Orders;
(b) Special Power of Attorney;
(c) Copy of Certified Certificate of Business Registration;
(d) VISA Authorization and/or NOC VISA.
....60
A Certification61 dated February 3, 1995, issued by the same agency, also states that:
"MRS. FLOR T. GUTIERREZ was (sic) employed as OVERSEAS MARKETING
DIRECTRESS of SARIFUDIN MANPOWER AND GENERAL SERVICES,
effective May 1994, up to the present"62
The defense also submitted several documents to prove compliance with the
requirements of the agency for her to assume her duties under the SPA. These
include receipts63 for a cash bond in the amount of P30,000.00 that she paid in
several installments. She also paid a royalty fee of P4,000.0064 and an office rental
fee of P3,000.00.65
The accused was also required by the agency to submit a monthly report for June
1994, as evidenced by a Memorandum signed by the General Manager, Leah
Salud.66 She submitted said monthly report, indeed, several monthly reports.67 A
document calling on all Marketing Directresses/Directors to attend a meeting on July
8, 1994, was also presented.68
The accused did not receive any salary or allowances from Sarifudin but received
commissions from the agency's principals, the employers from foreign countries (ten
in the Middle East and two in Singapore) at the rate of U.S. $100.00 per
person.69 From her commissions, she paid rent and royalty to Sarifudin.70
Edwin Cristobal, POEA Labor Employment Officer, confirmed that Sarifudin was
duly licensed to engage in recruitment activities.71 He presented a Certification
issued by Ma. Salome S. Mendoza, Manager of the Licensing Branch72 and
containing the list of officers and staff of Sarifudin. On said list appear the names
"Florna Gutierrez" and "Flor Gutierrez,"73 apparently, one and the same person.74 In
the same Certification, appears the following:
3
It is further certified that the said agency revoked the appointment of Ms. Flor
Gutierrez as Overseas Mktg. Director/Manager in a letter dated Dec. 15, 1995,
although this Office has not received nor acknowledged the representation of Ms.
Gutierrez.75
Cristobal explained that the POEA, "Never had a letter from Sarifudin registering or
authorizing Flor Gutierrez... rather, [what] we received [was a] revocation of her
appointment."76 He also revealed that the name of the accused does not appear in the
records of the POEA as being employed by the agency from the assumption of its
license on June 11, 1993, up to its termination on June 11, 1995.77
The defense likewise alleged that complainants Rosemarie Tugade and Evelyn
Ramos executed Affidavits of Desistance dated May 12, 1995,78 stating that the
accused had returned to them the amounts they paid her and that the complaint was a
result of a misunderstanding.
On March 22, 1996, the trial court rendered its Decision finding the accused guilty
beyond reasonable doubt of Illegal Recruitment in Large Scale:
WHEREFORE, after evaluating all the foregoing, the accused FLOR GUTIERREZ
is hereby found guilty beyond reasonable doubt of Illegal Recruitment in Large
Scale, and judgment is hereby rendered as follows:
(a) Convicting the accused of Illegal Recruitment in Large Scale and
sentencing her to suffer the penalty of life imprisonment and payment of
P100,000.00 fine;
(b) No reimbursement to complainants is needed since their money have
already been returned;
(c) Accused to pay moral damages in the amount of P50,000.00 to each
complainant;
(d) Accused to pay exemplary damages in the amount of P50,000.00 to each
complainant; and
(e) To pay the costs of the suit.79
Accused Flor Gutierrez filed the present appeal seeking the reversal of her
conviction.
Illegal recruitment is committed when two elements concur, namely: (1) the offender
has no valid license or authority required by law to enable one to lawfully engage in
recruitment and placement of workers; and (2) he undertakes either any activity
within the meaning of "recruitment and placement" defined under Art. 13(b), or any
of the prohibited practices enumerated under Art. 34 of the Labor Code.80 Art. 13(b)
of the Labor Code defines "recruitment and placement" as "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."81
The crime becomes Illegal Recruitment in Large Scale when the two elements
concur, with the addition of a third element: the recruiter committed the same against
three or more persons, individually or as a group.82
Appellant argues that as a representative of a duly licensed recruitment agency, she
cannot be held guilty of Illegal Recruitment in Large Scale. We disagree.
Section 11, Rule II, Book II of the Rules and Regulations Governing Overseas
Employment requires the prior approval of the POEA of the appointment of
representatives or agents:
Section 11. Appointment of Representatives. Every appointment of representatives
or agents of licensed agency shall be subject to prior approval or authority of the
Administration.
The approval may be issued upon submission of or compliance with the following
requirements:
a. Proposed appointment or Special Power of Attorney;
b. Clearances of the proposed representative or agent from NBI;
c. A sworn or verified statement by the designating or appointing person or
company assuming full responsibility for all the acts of the agent or
representative done in connection with the recruitment and placement of
workers.
Approval by the Administration of the appointment or designation does not authorize
the agent or representative to establish a branch or extension office of the licensed
agency represented.
4
Any revocation or amendment in the appointment should be communicated to the
administration. Otherwise, the designation or appointment shall be deemed as not
revoked or amended.
Section 1, Rule X of the same Book, in turn, provides that "recruitment and
placement activities of agents or representatives appointed by a licensee, whose
appointments were not authorized by the Administration shall likewise constitute
illegal recruitment."
The Certification from the POEA that it "has not received nor acknowledged the
representation of Ms. Gutierrez" establishes that the appointment of appellant by
Serafudin as a representative or agent was not authorized by the POEA. It may be
true that the POEA received from Serafudin a revocation of appellant's appointment,
but still is of no consequence since Serafudin in the first place did not submit her
appointment to the POEA, and so the POEA has nothing to approve.
As found by the trial court83 the evidence on record, notably appellant's own version,
indicates that she was running her own labor recruitment business.
Appellant cannot escape liability by claiming that she was not aware that before
working for her employer in the recruitment agency, she should first be registered
with the POEA.84 Illegal recruitment in large scale is malum prohibitum, not malum
in se.85 Good faith is not a defense.
That appellant engaged in recruitment and placement is beyond dispute. The
complaining witnesses categorically testified that the accused promised them on
several occasions that they would be leaving for work abroad. Appellant received
complainants' money and documents, a fact that the complainants themselves
witnessed and which the accused acknowledged when she returned the same to them
after the filing of the case against her. Appellant even brought complainant Rosalyn
Sumayo to the airport three times, raising her expectations, but leaving her hanging
in mid-air. The accused even had the audacity to demand cancellation fees from the
complainants when they asked for a refund.
The Affidavits of Desistance executed by two of the complainants deserve little
weight. The Court attaches no persuasive value to affidavits of desistance, especially
when executed as an afterthought. As held in the case of People v. Ubina,86 "it would
be a dangerous rule for courts to reject testimonies solemnly taken before the courts
of justice simply because the witnesses who had given them later on changed their
mind for one reason or another; for such rule would make solemn trials a mockery
and place the investigation of truth at the mercy of unscrupulous witnesses." 87
As appellant committed illegal recruitment against three or more persons, she is
liable for Illegal Recruitment in Large Scale.
WHEREFORE, the Decision of the Regional Trial Court, finding appellant Flor
Gutierrez y Timod guilty beyond reasonable doubt of the crime of Illegal
Recruitment in Large Scale and sentencing her to life imprisonment and to pay a fine
of P100,000.00 is AFFIRMED.
SO ORDERED.
G.R. No. 119076. March 25, 2002.*
PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ROGER SEGUN and
JOSEPHINE CLAM, accused-appellants.
Criminal Law; Labor Law; Illegal Recruitment; Elements of the crime of
illegal recruitment in large scale.—The crime of illegal recruitment in large scale is
committed when three 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. Third, the
offender commits said acts against three or more persons, individually or as a group.
Same; Same; Same; Evidence; Testimony constituting conclusions of law has
no probative value and is not binding upon the court; The term “recruit” is a
conclusion of law.—By itself, Rogelio’s testimony is far from conclusive that
appellants actually recruited his wife and children. Rogelio used the term “recruit”
which is a conclusion of law; the prosecution did not elicit from him the specific act
constituting the recruitment. Section 36, Rule 130 of the Rules of Court states that a
witness can testify only to those facts which he knows of his personal knowledge. He
is not permitted to testify as to a conclusion of law. Law in the sense here used
embraces whatever conclusions belong properly to the court. Thus, it has been held
that the bare statements of a rape victim that she was “sexually assaulted” or “raped”
by the accused are not sufficient to establish the accused’s guilt for the crime of rape.
Testimony constituting conclusions of law has no probative value and is not binding
upon the court.
Same; Same; Same; Same; Same; The witness must testify as to the facts that
would prove recruitment.—As we held earlier, “recruit” is a legal conclusion. The
witness must testify as to the facts that would prove recruitment. It does not suffice
that the witness simply state that the accused “recruited” the “victim.” Hence, the
testimony of Josephine Aba that appellants “recruited” her nephews is, by itself,
insufficient to convict appellants for the recruitment of Pedro and Pablo Ozarraga.
APPEAL from a decision of the Regional Trial Court of Iligan City, Br. 4.
______________
*
 FIRST DIVISION.
674
674  SUPREME COURT REPORTS ANNOTATED 
People vs. Segun
5
The facts are stated in the opinion of the Court.
     The Solicitor General for plaintiff-appellee.
     Public Attorney’s Office for accused-appellant.
KAPUNAN, J.:
Appellants Roger Segun and Josephine Clam were charged before the Regional Trial
Court (RTC) of Iligan City with violating Article 38 of the Labor Code, as amended,
in an information reading:chanrob1es virtual 1aw library
That on or about the 3rd day of March, 1993 and for sometime thereafter, at
Linamon, Lanao del Norte, Philippines and within the Jurisdiction of this Honorable
Court, the above-named accused, conspiring, confederating and mutually helping
each other, did then and there willfully, unlawfully and feloniously canvass, enlist,
contract, transport and recruit for employment the following persons,
namely:chanrob1es virtual 1aw library
Upon arraignment, appellants pleaded not guilty to the above charges.
The prosecution presented eight (8) witnesses, namely, Francita L. Manequis,
Conchita Tambacan, Josephine Aba, Melecio Ababa, Rogelio Collantes, Loreta
Caban, Christine Collantes and Elena Arañas.
Manequis, Employment Officer III and Administrative Officer of the Department of
Labor and Employment (DOLE), identified two certifications issued by Allan
Macaraya, then DOLE Director for Region XII 2 . The first Certification, 3 dated
October 7, 1993, stated that "per records available in this Office" appellants were
"neither licensed nor authorized by this Department to recruit workers for overseas
employment." The second, 4 dated May 17, 1993, was "issued upon the request of
[the] Honorable Mayor of Linamon, Lanao del Norte, Mayor Alejandro C. Alfeche."
It stated that appellants, "per records of this Office," were "not authorized to conduct
recruitment for local and overseas employment."cralaw virtua1aw library

1. Mario Tambacan; Conchita Tambacan, 50, married, a tobacco vendor and a resident of Linamon, Lanao
del Norte testified that her son Mario, then 17, was "recruited" by appellants on
2. Mary Jane Cantil; March 6, 1993 and brought to Manila. She knew that he was recruited only because
"many told [her]." Her son did not consult her regarding the recruitment. At the time
3. Richard Arañas; of her testimony, her son had sent her only two letters from Cabanatuan City but had
not returned home to Linamon, Lanao del Norte.
4. Victoria Collantes;
After learning of her son’s recruitment, Mrs. Tambacan went to the Mayor of
5. Christine Collantes; Linamon who, in turn, verified from DOLE whether appellants had any authority to
undertake recruitment. Subsequently, the mayor handed Mrs. Tambacan the
6. Rogelio Collantes; certification dated May 17, 1993. 5 

7. Luther Caban; Josephine Ozarraga Aba, 28, married, a housekeeper, and a resident of Linamon, is
the aunt of twins Pedro and Pablo Ozarraga. Pedro and Pablo, then 18, are the sons
8. Loreta Caban; of her deceased sister. Mrs. Aba testified that sometime in March or April 1993 her
nephews told her that they wanted to go to Manila and that they were "recruited."
9. Jonard Genemelo; Her nephews were then jobless and were looking for work. Mrs. Aba went to
appellants’ house to inquire from appellants, who were her neighbors, if what her
10. Jhonely Genemelo; nephews told her was true. In appellants’ house, she saw appellants, her nephews,
among others. Appellants told her that her nephews would be given free fare to
11. Pedro Ozarraga; Manila, free meals and good wages. These they also promised her nephews. Mrs.
Aba claimed that appellants brought one of the twins to Cabanatuan and the other to
12. Pablo Ozarraga; and Bulacan. When she testified, her nephews had not yet returned to Linamon. 6 

13. Pacifico Villaver, Melecio Ababa, 64, married, a fish vendor, and a resident of Linamon, Lanao del
Norte, is the grandfather of Jhonely and Jonard Genemelo. Sometime in April 1992,
Without any license and/or authority to engage in recruitment and placement of Ababa learned that appellants had "recruited" his grandsons. Ababa asked his
workers from the Department of Labor and Employment. 1  grandsons, "Why will you work there [in Cabanatuan City] [when] in fact you can

6
find jobs here?" Ababa went to the house of appellants who assured him that the
transportation to Manila was free, and that his grandsons were to be provided free
meals and paid good wages. Because of these promises, he acquiesced to the
recruitment. At the time of his testimony, Ababa’s grandsons had not returned to
Linamon. All he received from them were two letters but no money. 7 
Another complainant, Rogelio Collantes, 44, jobless and a resident of Linamon,
Lanao del Norte, is the husband of Victoria Collantes and the father of Christine,
then 13, and Rogelio, Jr., then 6. Sometime in April 1993, Rogelio learned that
appellants had "recruited" Victoria, Christine and Roger. Rogelio talked to appellants
who promised that his wife and children’s transportation to Manila and meals will be
free and that they will receive good wages. Victoria, Christine and Rogelio, Jr., who
were then looking for jobs, were then brought to Cabanatuan City.
At the time of his testimony, Rogelio’s children had already returned to Linamon,
traveling home with appellant Josephine Clam. Collantes’ wife, though, was still in
Nueva Ecija. She had sent letters to Rogelio thrice, and money twice, once in the
amount of P1,000.00 and the other time P800.00. 8 
The prosecution also presented Rogelio’s daughter Christine, who was among those
allegedly recruited by appellants. Christine said her parents were jobless during the
months of March and April 1993 and were looking for work. Upon the invitation of
appellants, she and her mother went to the house of appellants on March 26, 1993.
Appellants offered her mother a job. Christine went with her mother to Cabanatuan
City where her mother forced her to work. According to Christine, those "recruited"
totaled thirteen, including her mother and her brother. She and the others took a boat
to Manila and Cabanatuan City. Appellants shouldered the transportation expenses.
In Cabanatuan, Christine did housework for a certain Engr. Sy for seven (7) months.
She was paid P500.00 a month. She returned home in Linamon on December 4,
1993. Neri Clam, Josephine’s sister, paid for her fare to Manila.
Like Christine, her mother Victoria also performed housework in Cabanatuan City
for a certain Mabini Llanera. Her brother, Rogelio, Jr., was not able to find work
because he was still a child. 9  they just came from Manila themselves. She said that before she went to appellants’
Loreta Cavan, * 14, and also a resident of Linamon, Lanao del Norte, testified that
sometime in March 1993, she was "recruited" by appellants and brought to Manila
then to Cabanatuan City. She related that she met appellants in the house of
Josephine Clam, where she was recruited. Appellants told her that Cabanatuan City
was a "good place" "because the salary [was] big." Loreta agreed to go. Loreta
further stated that those "recruited" by the couple totaled thirteen, including the twin
brothers Pedro and Pablo, a certain woman named Pasbel, a certain Johnny, and
Loreta’s sister Luther.
At Cabanatuan City, Loreta was able to work for a certain Barangay Captain
Centioco for three (3) months for P600.00 a month. Loreta purportedly was not paid
for her services since her two months’ salary was supposed to pay for her fare to
Manila.
Loreta denied that she went to the house of appellants to seek their help. Rather,
appellants allegedly offered her a job. Appellants invited her to go to their house on
March 27, 1993. Loreta learned from her sister Luther that appellants were
recruiting.
Loreta’s sister Luther, who was among those listed in the information as having been
recruited by appellants, went to Manila to work but her job was not provided by
appellants. 10 
The prosecution also offered the testimony of Ester Cavan, the mother of Loreta
Cavan, to corroborate the latter’s testimony. The same was dispensed with, however,
the corroborative nature thereof having been admitted by counsel for the defense. 11 
Finally, Elena Arañas, mother of Richard Arañas, related that on March 6, 1993
appellants brought her son, then 19, to Cabanatuan City. Her son, who was then
looking for work, was promised that he would be given a good salary. She learned of
the promise when she went to appellants’ house where she saw appellants, her son,
among others. Elena claimed that she was present when appellants approached her
son and offered him work in Cabanatuan City. Elena agreed to the recruitment of her
son because of the promise of a good salary. However, she has not heard from her
son since he left nor had she received any money from him. 12 
Appellants’ defense was predicated on denial. They presented five witnesses to
support their case.
Myrna Sasil, 35, married, a housekeeper and a resident of Iligan City, testified that in
March 1993 she went to the appellants’ residence to ask them to find a job in Manila
for her daughter Margie. Prior to that, Myrna had known appellants for almost a
year. She knew that appellants could help their daughter find work in Manila because
house, she did not know that appellants were sending people to Manila for work. As
Myrna’s family was then suffering from financial difficulties, Josephine agreed to
find work for Myrna’s daughter.
According to Myrna, Margie left with the thirteen persons listed in the information as
having been recruited by appellants. Appellants paid for Margie’s fare to Manila,
which she reimbursed from her salary. At the time of Myrna’s testimony, Margie
was still working in Cabanatuan City and was sending Myrna money from her salary.
13 
7
Losendo Servano, 50, married, a farmer and a resident of Linamon, Lanao del Norte,
is a neighbor of appellants as well as those of the thirteen persons they allegedly
recruited. Losendo had known Josephine Clam since she was born, and Roger Segun
when the latter and Josephine got married.
Losendo testified that his son Ruel did not have work in Linamon. If Ruel stayed in
Linamon, Losendo said he would become a hoodlum or a delinquent. His son thus
requested appellants to take him with them to Manila and find work for him, saying
"Manong, Manong, I just go with you to Manila."cralaw virtua1aw library
In April 1993, Ruel, appellants and thirteen others left for Manila by boat. Appellants
shouldered Ruel’s expenses in going to Manila. When Ruel was able to find work, he
paid appellants by installment. Losendo claims that his son found work through the
help of appellants. 14  for payment from those who did not pay. He claimed he was able to help find jobs
Virgincita Ozarraga, 30, a housekeeper and a resident of Linamon, Lanao del Norte,
is the sister of appellant Josephine Clam. She is also the aunt of the twins Pedro and
Pablo Ozarraga and a neighbor of the thirteen persons allegedly recruited by
appellants.
According to Virgincita, Josephine Clam went to Nueva Ecija in 1991 but transferred
in 1992 to Dagupan City. In both places, Josephine worked as a house helper. Roger
Segun, on the other hand, worked as liaison officer for Rolmar Employment
Services.
Virgincita disputed Conchita Tambacan’s testimony that appellants recruited the
latter’s son Mario. She said that Mario went to appellants’ house. Josephine did not
promise him a job because they were not recruiters although appellants assured him
they would help him find a job.
Virgincita further testified that in March 1993 Pedro and Pablo Ozarraga also went to
the house of Virgincita’s mother to ask appellants to help them find work because
there were times they could not eat. Josephine allegedly told the twins that she was
not a recruiter but she would help them find work. She purportedly said the same
thing to Jhonely and Jonard Genemelo, Victoria and Christine Collantes, and Loreta
and Luther Cavan. Josephine also told them that she was not promising them
anything.
Appellants and the thirteen persons they purportedly recruited left for Manila by
boat. Appellants paid for their fare and were able to find work for them in Manila,
Cabanatuan and other places in Luzon. Thereafter, appellants returned to Linamon.
To Virgincita’s knowledge, no people sought their help to find them jobs after the
couple returned from Manila. 15  violating Article 38 of the Labor Code, as amended:chanrob1es virtual 1aw library
Appellant Roger Segun, 34, single, is an employee of the Rolmar Employment
Services. As the liaison officer of the agency, appellant undertakes the processing of
the papers for the agency’s license.
According to appellant, around April and May of 1993, the thirteen persons listed in
the information went to the house of Josephine Clam to ask her to help them find
jobs in Cabanatuan City. Their neighbors knew that Josephine used to work in
Cabanatuan City, Pangasinan and Dagupan City. Josephine told them that she was
not a recruiter although she would help them find work.
Appellants accompanied the thirteen to Manila as they (appellants) were going there
anyway. Appellants shouldered their neighbors’ transportation and other expenses
from Linamon to Cabanatuan City upon the promise that they (appellants) would be
paid back. Eventually, some paid while others did not. Roger did not bother to ask
for their neighbors by recommending them to friends who needed helpers and
workers. Until they were able to find jobs, the thirteen stayed in Roger’s house in
Cabanatuan City.
Roger admitted that neither he nor Josephine Clam had a license to recruit. He said
he was not a recruiter. He also revealed that after he brought the thirteen to Manila,
he tried to secure a license to recruit but his application was disapproved. 16 
Appellant Josephine Clam, 28, single, and residing at Linamon, Lanao del Norte,
used to work as a house helper in Pangasinan and Bulacan for a year after which she
returned to Linamon.
Around March and April 1993, the thirteen persons listed in the information went to
her house to ask her help to find them work. They knew that Josephine used to work
in Pangasinan and Dagupan. She told them she would try her best to help them but
informed them that she was not a recruiter.
Roger and Josephine shouldered their neighbors’ transportation and food expenses
on the condition that their neighbors reimburse appellants once they found jobs.
Some of them eventually paid them back although others did not. Appellants were
able to find jobs for the thirteen since Roger had many friends.
Josephine admitted that she did not have any license to recruit since she was not a
recruiter. She and Roger helped their neighbors find jobs because she took pity on
them when they begged her to help them find jobs. She even spent her and Roger’s
joint savings to answer for her neighbors’ expenses. 17 
Based on the foregoing evidence, the Iligan City RTC convicted appellants for
WHEREFORE, finding the accused guilty beyond reasonable doubt of Illegal
8
Recruitment of the 13 persons mentioned in the information, namely: Mario
Tambacan, Mary Jane Cantil, Richard Aranas, Victoria Collantes, Christine
Collantes, Rogelio Collantes, Luther Caban, Loreta Caban, Jonard Genemilo,
Jhonely Genemilo, Pedro Ozarraga, Pablo Ozarraga and Pacifico Villaver in a large
scale, the accused are hereby sentenced to suffer a penalty of life imprisonment for
each of them and to pay a fine of P100,000.00 each. The bail bond put up by the
accused is hereby ordered cancelled, in view of the penalty imposed by this Court of
life imprisonment, which is a nonbailable offense.
SO ORDERED. 18  While the law does not require that at least three (3) victims testify at the trial, it is
Appellants contend that their guilt was not proven beyond reasonable doubt. They
maintain that it was their neighbors who approached them in the house of Josephine
Clam’s mother and solicited their assistance in their (the neighbors’) desire to go to
Manila. Josephine Clam had a history of employment in Luzon and had just returned
to Linamon. In Josephine, the neighbors saw an opportunity to taste economic
progress and escape poverty and stagnation. Appellants took pity on them and helped
them find jobs, even defraying their neighbors’ travel expenses. They submit,
therefore, that they were not engaged in the recruitment of persons for employment
but in pursuit of a lawful and noble endeavor for the benefit of the less fortunate.
They neither collected nor received any consideration for their efforts. Appellants
point out that of the 13 allegedly recruited only Christine Collantes and Loreta Cavan
testified against them. Considering these circumstances, appellants submit that the
evidence against them is at most ambiguous and inconclusive. 19  A Many told me. 24
The crime of illegal recruitment in large scale is committed when three 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. Third, the offender commits said acts against three or more
persons, individually or as a group. 20  ATTY. BAYRON:chanrob1es virtual 1aw library
There is no dispute that the first element is present in this case. The certification
dated May 17, 1993 and issued by DOLE Region XII Director Allen Macaraya,
states that appellants "were not authorized to conduct recruitment for local and
overseas employment." Both appellants conceded they have no license to recruit. 21 
The next question is whether appellants undertook any activity constituting
recruitment and placement as defined by Article 13 (b) of the Labor Code, which
states:jgc:chanrobles.com.ph
"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.
Did the prosecution prove beyond a reasonable doubt that appellants canvassed,
enlisted, contracted and transported the thirteen persons listed in the information? In
examining the prosecution’s evidence, we bear in mind that a conviction for large
scale illegal recruitment must be based on a finding in each case of illegal
recruitment of three (3) or more persons whether individually or as a group. 22
necessary that there is sufficient evidence proving that the offense was committed
against three (3) or more persons. 23 
There is no evidence that appellant undertook the recruitment of Mary Jane Cantil
and Pacifico Villaver. Neither Cantil nor Villaver testified in court. No witness
testified as to the fact of their recruitment.
As regards Mario Tambacan, his mother Conchita testified that she learned of his
recruitment only from other persons. On direct examination she said:chanrob1es
virtual 1aw library
Q How did you know that he was recruited?
 
On cross-examination, she further revealed:chanrob1es virtual 1aw library
Q You claimed that he was recruited but you did not see the recruitment? 
A This Josephine Clam and a companion recruited my son because many saw them.
That is hearsay.
COURT:chanrob1es virtual 1aw library
Q But you, yourself, you did not see that he was recruited? Were you present when
Mario Tambacan was recruited by the accused?
A I was not present.
Q You were only informed?
A Yes.
9

Q Your testimony here that he was recruited was only told to you?
A Yes.25cralaw:red
Conchita Tambacan’s testimony is clearly hearsay and, thus, of little probative value.
26 It hardly suffices to prove Mario Tambacan’s recruitment beyond reasonable
doubt.
We now examine the evidence offered to prove the recruitment of the Collanteses.
The prosecution’s evidence consists of the testimonies of Rogelio Collantes and his
daughter Christine. Rogelio testified that his wife and children were "recruited" by
appellants, that appellants promised that his wife and children were to be provided
free meals and transportation to Manila and good wages, and that appellants brought
his wife and children to Manila.
Q Do you recall what happen[ed] to Victoria, Cristine and Roger Collantes, Jr.,
sometime in April, 1993?
A They were recruited.
Q By whom?
A Roger Segun and Josephine Clam.
x       x       x
Q When you learn[ed] that your wife Victoria, Cristine your daughter and son Roger
Segun, Jr., were being recruited by the accused whom you just identified, what did
you do then?  Article 13 (b) for if we subscribe to the defense’s account, appellants merely
A I verified about their recruited (sic).
Q You mean you were to talk to Josephine Clam and Roger Segun?
A Yes.
Q Have you talked to Josephine Clam and Roger Segun?
A Yes.
Q What did they tell you?
A They promised that the transportation to Manila will be free and the meals and
good wages. 
x       x       x
Q Were these two accused Roger Segun and Josephine Clam able to bring your wife
and children to Manila?
A Yes.
Q Do you know what place in Manila they were taken?
A In Cabanatuan City. 27 
By itself, Rogelio’s testimony is far from conclusive that appellants actually
recruited his wife and children. Rogelio used the term "recruit" which is a conclusion
of law; the prosecution did not elicit from him the specific act constituting the
recruitment. Section 36, Rule 130 of the Rules of Court states that a witness can
testify only to those facts which he knows of his personal knowledge. He is not
permitted to testify as to a conclusion of law. Law in the sense here used embraces
whatever conclusions belong properly to the court. 28 Thus, it has been held that the
bare statements of a rape victim that she was "sexually assaulted" or "raped" by the
accused are not sufficient to establish the accused’s guilt for the crime of rape. 29
Testimony constituting conclusions of law has no probative value and is not binding
upon the court. 30 
Rogelio also said that appellants made certain promises but it is not clear if these
were made to Rogelio or to his wife and children. That appellants "brought" them to
Manila does not necessarily mean that they were "transported" in the context of
accompanied Rogelio’s family to Manila. If two inculpatory facts are capable of two
different interpretations, that which would favor the accused should be adopted. 31 
On the other hand, Christine Collantes testified on direct examination:chanrob1es
virtual 1aw library
Q Do you recall sometime in April, 1993 what transpired between you and these 2
accused in this case?
A They treated me well.
Q How did it happen that these 2 accused treated you well sometime in April, 1993?
A They told us we would be given work.
10
Q Where will you be given work? A Josephine Clam and Roger Segun.

A In Cabanatuan City, sir. Q When you arrived in Manila you proceeded to Cabanatuan City, is that correct?

Q In other words how many were you these 2 accused promised to give you work in A Yes.
Cabanatuan City?
Q That includes your mother and your brother?
A We were 13.
A Yes, sir.
Q That includes your mother and your brother Rogelio, Jr.?
Q As promised by the accused that you would be given a job, were [you] able to
A Yes, sir. have a job there in Cabanatuan City?

Q And that includes you also? A Yes, sir.

A Yes. Q What is your work there?

Q Did you agree to their proposal that you will be given job in Cabanatuan City if A House work.
you will go there?
Q To whom did you work with?
A Yes, sir.
A With Engr. Sy.
Q How about your mother?
Q How much did he agree as your wages?
A Yes, sir.
A P500.00 a month.
Q How about your brother?
Q Do you know if your mother was able to secure a job as promised by the accused?
A My brother went with my mother.
A Yes.
Q When you agree[d] with your mother, were you able to go in Cabanatuan City
together with the accused as they promised? Q Was she able to get a job?

A Yes, sir. A Yes.

Q That includes the others recruited with the total of 13 of you? Q What kind of job?

A Yes, sir. A House work.

Q What means of transportation did you take from here to Manila? Q How about your younger brother, was he able to have a work there?

A William Lines. A No he is still a child.

Q Who shoulder[ed] the expenses of that boat in going there from here? COURT

11
 Q The accused did not invite you to go to their house on March 26, 1993, am I
Q To whom did your mother work? correct?

A Mabini Llanera in Cabanatuan City. 32  A We were invited.

On cross-examination, she related:chanrob1es virtual 1aw library Q You and your mother went to the house ,of the accused because you ask[ed] for
help to find a job, am I correct?
Q Is it not a fact that your mother went to the house of the accused and beg[ged] you
to find a job? FISCAL BALABAGAN

A Yes, sir. Already answered, Your Honor.

Q You also went with your parents when your mother went to the house of the COURT
accused?
Answer.
A Yes, sir.
WITNESS
Q The accused did not offer [a] job for your mother?
A We were invited. 34 
A She offered.
Christine’s testimony establishes beyond a reasonable doubt that appellants recruited
Q You went along with your mother to Cabanatuan City, is that correct? Christine’s mother Victoria. Christine explicitly stated that appellants offered her
mother a job and told them that they "would be given work." Victoria thus agreed to
A Yes. appellants’ "proposal" that she would be given a job in Cabanatuan City.

Q Now, will you please tell the court why did you go along with your mother to However, there is reasonable doubt whether appellants actually recruited Christine
Cabanatuan City? herself since Christine said that she "was forced by [her] mother to work in
Cabanatuan City."cralaw virtua1aw library
A In order to work.
The Court also entertains grave doubts regarding the alleged recruitment of
Q The accused did not offer you [a] job but you only went along with your mother to Christine’s brother Rogelio, Jr., who, according to Christine, went with their mother
Cabanatuan City, is that correct? and was not able to work because, at 6, he was "still a child." Did Rogelio, Jr. go to
Cabanatuan City to work or did he just go together with his mother so she could look
A No. after him? The former is unlikely while the latter is not farfetched since the child was
too young to work and still needed looking after.
COURT
The prosecution, however, succeeded in proving that appellants recruited Loreta
Q What do you mean when you say no? Cavan. Loreta testified that appellants told her that the salary in Cabanatuan City was
good, that she agreed to their proposal for her to work there, and that they brought
A I was forced by my mother to work in Cabanatuan City. 33  her to Manila then to Cabanatuan City:chanrob1es virtual 1aw library

And on re-cross:chanrob1es virtual 1aw library Q Who brought you to Manila and then Cabanatuan City?

ATTY. BAYRON A Josephine Clam and Roger Segun.

12
Q Why did they bring you to Manila then to Cabanatuan City? A Yes.

A According to them that place is good because the salary is big. Q When they told you that the salary is good, what did you do?

x       x       x A I am willing to go.

Q You said you were brought to Manila by these two accused on March 27, 1993,
before that March 27, was there any occasion that you met the accused in this case?
A Yes, sir.
Q Where did you meet them?
Q You mean you agreed with their proposal to you and that you are going to work
there?
A Yes, sir. 35 
On cross-examination, she said that appellants offered her employment and she went
to appellants’ house because they were recruiting:chanrob1es virtual 1aw library

A In Linamon. ATTY. BAYRON

Q In the house of Mrs. Josephine Clam? Q You said awhile ago that you went to the house of the accused in Linamon, Lanao
del Norte, can you recall when was that when you went to the house of the accused
A Yes, sir. in this case?

Q What transpired when you first met with the accused Josephine Clam in their A March 27.
house in Linamon?
Q Did you go to the house of the accused alone or with companion?
A They told us that in the boat where we are going to take, we are prohibited to go
around the boat. A I have companions.

COURT Q Please tell the court why did you go to the house of the accused on March 27,
1993?
Q Prior to that when for the first time you met the accused?
A Because they have recruited us.
WITNESS
Q Is it not a fact that you went to the house of the accused in Linamon because you
A At the time when we are recruited. sought their help to find a job?

Q How did they recruit you? A No, sir.

A They told me that the salary in that place is good. Q The accused in this case did not offer you a job?

FISCAL BALABAGAN A They offered me.

And because they told you that the salary is good, you are referring to Cabanatuan Q Is it not a fact that you beg[ged] the accused to help you find a job outside
City? Linamon, Lanao del Norte?

WITNESS A No, sir.

13
Q The accused in this case did not invite you to go in their house on March 27,
1993? A The twin brother, Pedro and Pablo.

A No, sir. x       x       x

Q You went there on March 27, 1993 on your own volition, am I correct?
Q Who else?
A Sir, sir.* 
A Luther Caban.
Q You are familiar with the house of the accused in Linamon, Lanao del Norte, am I
correct? Q What is your relation with Luther Cavan?

A Yes, sir. A She is my sister.

Q In the house of the accused you can not find any signboard that they are recruiting x       x       x
people for jobs, am I correct?

A No, sir. FISCAL BALABAGAN

COURT Q You said that you were recruited together with your sister and others and were
brought to Cabanatuan City, is that correct?
Q What is your purpose in going to the house of the accused?
A Yes, sir.
A Because they are recruiting.
Q Who brought you there?
Q Prior to that when you went there, you have not met them before?
ATTY. BAYRON
A No, sir.
Already answered.
Q Why did you go to the house of the accused and knew that they are recruiting?
COURT
A I was told by my sister.
Witness may answer.
Q Luther is your elder sister?
WITNESS
A Yes. 36 
A Josephine Clam and Roger Segun. 37 
The prosecution however failed to prove, that appellants recruited Loreta’s sister,
Luther. Loreta testified, thus:chanrob1es virtual 1aw library Again, the term "recruit" is a conclusion of law. The prosecution failed to elicit from
Loreta how appellants "recruited" Luther. While Loreta also said that Luther was
Q How many of you were brought and were recruited by the accused? among the thirteen brought to Manila, it does not necessarily mean that her
transportation was for purposes of employment. Moreover, Loreta said that Luther’s
A We were 13. job, at least at the time Loreta testified, was not a result of appellant’s efforts.

Q Can you mention who were your companions? Q How about your sister Luther, where is she now?
14
A She is in Manila.
Q Why [is] she is still in Manila until now?
A She went there to work.
Q Who gave her work, were the accused in this case as promised to you?
A No, sir. 38  neighbors’ expenses. The same holds true for the claim that appellants brought the
These circumstances give rise to doubts whether appellants indeed recruited Luther
Cavan.
Neither was the prosecution able to establish that appellants recruited the twins Pedro
and Pablo Ozarraga. Josephine Ozarraga Aba, the twins’ aunt, testified:chanrob1es
virtual 1aw library
Q Sometime in March or April, 1993, what happen to these two nephews of yours?
A They were recruited by Josephine Clam and Roger Segun.
x       x       x
Q You said that these 2 accused were the ones who recruited your 2 nephews
sometime in March or April, 1993. When you learn that they were recruited what did
you do if any?
A I went to their house and confronted them about my nephews and they told me that
my nephews will be given free fare to Manila, free meals and good wages and they
also promised that to my nephews.
Q You said they promised your nephews free fare to Manila, free meals and good
wages, whom are you referring they?
A Josephine Clam and Roger Segun.
Q Why were Josephine Clam and Roger Segun able to recruit your two nephews?
A Because they brought them.
Q Where did they brought your nephews?
A One in Cabanatuan and the other one in Bulacan. 39  x       x       x
As we held earlier, "recruit" is a legal conclusion. The witness must testify as to the
facts that would prove recruitment. It does not suffice that the witness simply state
that the accused "recruited" the "victim." Hence, the testimony of Josephine Aba that
appellants "recruited" her nephews is, by itself, insufficient to convict appellants for
the recruitment of Pedro and Pablo Ozarraga.
That appellants allegedly told Josephine Aba that her nephews would be given free
fare and meals is not inconsistent with appellants’ account that they paid for their
twins to Cabanatuan and Bulacan. According to appellants, they accompanied the
thirteen persons to help them find work. The reference to good wages could mean
that the rates of compensation in Cabanatuan or Bulacan are relatively high
compared to those in Lanao del Norte. These circumstances do not necessarily mean
that appellants recruited Pedro and Pablo Ozarraga.
We cannot give much credence to Josephine’s statement that appellants also
promised free fare and meals, and good wages to her nephews since the prosecution
did not show that Josephine was present when appellants made this supposed
promise to her nephews.
Neither did the prosecution prove beyond reasonable doubt that appellants recruited
Jhonely and Jonard Genemelo. Melecio Ababa, grandfather of Jhonely and Jonard
testified on direct examination:chanrob1es virtual 1aw library
Q Do you recall what happen to your 2 grandsons sometime in the month of April,
1993?
A They were recruited by Roger Segun and Josephine Clam.
x       x       x
FISCAL BALABAGAN
Q When you learn that your grandsons were being recruited by Roger and Segun and
Josephine Clam, what did you do?
A I went to their house.
Q You said you went to their house, whose house are your referring?
A The house of Roger Segun and Josephine Clam.
15
 Q Can you recall when your two grandsons Johnely and Jonard allegedly recruited
FISCAL BALABAGAN by the two accused?

Q Who were the people you met inside the house of Josephine Clam? A Sometime on the 16 or 17th.

A Them. Q What month?

Q Are you referring Roger Segun and Josephine Clam? A April.

A Yes. Q You were not present when your two grandsons were allegedly recruited by the
two accused?
Q Then what happen there when you went to the house of the accused?
A I was there present. 41 
A They promised that the transportation to Manila is free and free meals and good
wages. Note again the use of the term "recruit," a defect present in the testimonies of
Rogelio Collantes, Loreta Cavan and Josephine Aba. While Melecio Aba said that
Q Because of this free meals and transportation to Manila they promised to your appellants promised his grandsons free transportation and meals, and good wages,
grandsons and you what happen? these promises, as we have observed in analyzing Josephine Aba’s testimony, are not
incongruent with appellants’ version.
A They brought them to Cabanatuan City.
Lastly, Elena Arañas’ testimony on her son Richard’s alleged recruitment is
Q Did you agree with this? insufficient to prove appellants’ guilt. Elena testified on direct
examination:chanrob1es virtual 1aw library
A Yes, I agree.
FISCAL BALABAGAN
Q You agreed because of this promise of free transportation and good wages for your
grandchildren? Q Mrs. Elena Arañas, do you know Richard Arañas?

A Yes. 40  WITNESS

On cross-examination, Melecio said:chanrob1es virtual 1aw library A Yes, he is my son.

Q You only learn from somebody that your grandsons were recruited by the two Q Where is he now?
accused?
A In Cabanatuan City brought by Josephine Clam.
A From them personally because I went to their house.
Q Do you know what is the family name of Josephine?
Q You mean the house of your grandson?
A Yes, Clam.
A I went to the house of the recruiters because they were staying in my house.
Q When was your son brought by Josephine Clam and Roger Segun?
Q When you went to their house your grandsons were not there?
A March 6, that was Saturday.
A My two grandsons were there.

16
Q Do you know the reason why they brought your son in Cabanatuan on March 6,
1993? A I was there.

A Because of the promise that he would be given good salary. Q The accused in this case did not offer to your son but it was your son who asked
helped (sic) to find a job?
COURT
A My son was recruited that he would be given work.
Q How do you know that he was promised of a good salary?
COURT
A Because I went to their house.
Q The 2 accused never approached your son they have work in Cabanatuan City?
FISCAL BALABAGAN
A Yes, they said that.
Q Are you referring to the house of Josephine Clam?
ATTY. BAYRON
A Yes.
Q The accused tell (sic) your son that they will held your son to find a job?
Q Were there people there when you arrived there?
A Yes, sir. 43 
A Yes, Josephine Clam, Roger Segun, my son and others.
Elena’s testimony fails to state the specific act constituting the recruitment. Elena
Q Did you agree to recruitment that your son will be brought to Cabanatuan City? merely declared that her son was "recruited" — a legal conclusion. Appellants also
supposedly said that "they have work in Cabanatuan City" and that "they will help
A Yes. [her] son to find a job." Elena did not state the context and the circumstances under
which these statements were made. Moreover, the statements attributed to appellants
Q Why did you agree? are ambiguous and hardly incongruous with appellants’ claim that they assisted their
neighbors find work, which assistance does not necessarily translate to an act of
A Because of the promise that they would receive good salary. recruitment. That there was a supposed promise of a good salary is also ambiguous
for, as noted earlier, the reference to good wages could mean that the rates of
Q Did he went there personally? compensation in Cabanatuan City are higher compared to those in Lanao del Norte.

A No. In sum, the prosecution failed to elicit from many of its witnesses the specific acts
constituting the recruitment of the other alleged victims. The prosecution was able to
x       x       x prove that appellants performed recruitment activities only in the cases of Victoria
Collantes and Loreta Cavan. The third element of illegal recruitment, i.e., that the
offender commits the acts of recruitment against three or more persons is, therefore,
FISCAL BALABAGAN absent. Consequently, appellants can be convicted only of two counts of "simple"
illegal recruitment.
Q How was your son recruited by the accused in this case?
WHEREFORE, the Decision of the Regional Trial Court is MODIFIED. Appellants
A As they promised that the salary is quite big. 42  are found GUILTY beyond reasonable doubt of two counts of illegal recruitment, as
defined and punished by Article 38 (a) of the Labor Code, in relation to Articles 13
On cross-examination, Elena said:chanrob1es virtual 1aw library (b) and 39 thereof. They are each sentenced to suffer for each count imprisonment of
four (4) to five (5) years.
Q You were not present when your son was allegedly recruited by the accused?
17

SO ORDERED.
G.R. No. 205727. January 18, 2017.*
 
RUTCHER T. DAGASDAS, petitioner, vs. GRAND PLACEMENT AND
GENERAL SERVICES CORPORATION, respondent.
Remedial Law; Civil Procedure; Appeals; Petition for Review on Certiorari;
As a rule, only questions of law may be raised in a petition under Rule 45 of the
Rules of Court. However, this rule allows certain exceptions, including a situation
where the findings of fact of the courts or tribunals below are conflicting.—As a
rule, only questions of law may be raised in a petition under Rule 45 of the Rules of
Court. However, this rule allows certain exceptions, including a situation where the
findings of fact of the courts or tribunals below are conflicting. In this case, the CA
and the NLRC arrived at divergent factual findings anent Dagasdas’ termination. As
such, the Court deems it necessary to reexamine these findings and determine
whether the CA has sufficient basis to annul the NLRC Decision, and set aside its
finding that Dagasdas was illegally dismissed from work.
Labor Law; Management Prerogative; It is well-settled that employers have
the prerogative to impose standards on the work quantity and quality of their
employees and provide measures to ensure compliance therewith.—It is well-settled
that employers have the prerogative to impose standards on the work quantity and
quality of their employees and provide measures to ensure compliance therewith.
Noncompliance with work standards may thus be a valid cause for dismissing an
employee. Nonetheless, to ensure that employers will not abuse their prerogatives,
the same is tempered by security of tenure whereby the employees are guaranteed
substantive and procedural due process before they are dismissed from work.
Same; Security of Tenure; Lex Loci Contractus; Since the employment
contracts of Overseas Filipino Workers (OFWs) are perfected in the Philippines,
and following the principle of lex loci contractus (the law of the place where the
contract is made), these contracts are  531
_______________
*  FIRST DIVISION.
 
 
530
530 SUPREME COURT REPORTS ANNOTATED
Dagasdas vs. Grand Placement and GeneralServices Corporation
governed by our laws, primarily the Labor Code of the Philippines and its
implementing rules and regulations (IRR); Thus, even if a Filipino is employed
abroad, he or she is entitled to security of tenure, among other constitutional rights.
—Security of tenure remains even if employees, particularly the Overseas Filipino
Workers (OFWs), work in a different jurisdiction. Since the employment contracts of
OFWs are perfected in the Philippines, and following the principle of lex loci
contractus (the law of the place where the contract is made), these contracts are
governed by our laws, primarily the Labor Code of the Philippines and its
implementing rules and regulations. At the same time, our laws generally apply even
to employment contracts of OFWs as our Constitution explicitly provides that the
State shall afford full protection to labor, whether local or overseas. Thus, even if a
Filipino is employed abroad, he or she is entitled to security of tenure, among other
constitutional rights.
Same; Probationary Employees; As regards a probationary employee, his or
her dismissal may be allowed only if there is just cause or such reason to conclude
that the employee fails to qualify as regular employee pursuant to reasonable
standards made known to the employee at the time of engagement.—Even assuming
that Dagasdas was still a probationary employee when he was terminated, his
dismissal must still be with a valid cause. As regards a probationary employee, his or
her dismissal may be allowed only if there is just cause or such reason to conclude
that the employee fails to qualify as regular employee pursuant to reasonable
standards made known to the employee at the time of engagement. Here, ITM failed
to prove that it informed Dagasdas of any predetermined standards from which his
work will be gauged. In the contract he signed while still in the Philippines,
Dagasdas was employed as Network Technician; on the other hand, his new contract
indicated that he was employed as Superintendent. However, no job description — or
such duties and responsibilities attached to either position — was adduced in
evidence. It thus means that the job for which Dagasdas was hired was not definite
from the beginning. Indeed, Dagasdas was not sufficiently informed of the work
standards for which his performance will be measured. Even his position based on
the job title given him was not fully explained by his employer. Simply put, ITM
failed to show that it set and communicated work standards for Dagasdas to follow,
and on which his efficiency (or the lack thereof) may be determined.
 
 
VOL. 814, JANUARY 18, 2017 531
Dagasdas vs. Grand Placement and GeneralServices Corporation
Same; Employment Contracts; Overseas Filipino Workers; Unless the
employment contract of an Overseas Filipino Worker (OFW) is processed through
the Philippine Overseas Employment Administration (POEA), the same does not
bind the concerned OFW because if the contract is not reviewed by the POEA,
certainly the State has no means of determining the suitability of foreign laws to our
overseas workers.—The new contract was not shown to have been processed through
the POEA. Under our Labor Code, employers hiring OFWs may only do so through
entities authorized by the Secretary of the Department of Labor and Employment.
18
Unless the employment contract of an OFW is processed through the POEA, the
same does not bind the concerned OFW because if the contract is not reviewed by
the POEA, certainly the State has no means of determining the suitability of foreign
laws to our overseas workers.
Same; Termination of Employment; Overseas Filipino Workers; The employer
must inform the employee of the cause or causes for his or her termination, and
thereafter, the employer’s decision to dismiss him. Aside from the notice
requirement, the employee must be accorded the opportunity to be heard.—A valid
dismissal requires substantive and procedural due process. As regards the latter, the
employer must give the concerned employee at least two notices before his or her
termination. Specifically, the employer must inform the employee of the cause or
causes for his or her termination, and thereafter, the employer’s decision to dismiss
him. Aside from the notice requirement, the employee must be accorded the
opportunity to be heard. Here, no prior notice of purported infraction, and such
opportunity to explain on any accusation against him was given to Dagasdas. He was
simply given a notice of termination. In fact, it appears that ITM intended not to
comply with the twin notice requirement. As above quoted, under the new contract,
ITM reserved in its favor the right to terminate the contract without serving any
notice to Dagasdas in specified cases, which included such situation where the
employer decides to dismiss the employee within the probationary period. Without
doubt, ITM violated the due process requirement in dismissing an employee.
Same; Quitclaims; Generally, the employee’s waiver or quitclaim cannot
prevent the employee from demanding benefits to which he or she is entitled, and
from filing an illegal dismissal case.—Generally, the employee’s waiver or quitclaim
cannot prevent the
 
532
532 SUPREME COURT REPORTS ANNOTATED
Dagasdas vs. Grand Placement and GeneralServices Corporation
employee from demanding benefits to which he or she is entitled, and from
filing an illegal dismissal case. This is because waiver or quitclaim is looked upon
with disfavor, and is frowned upon for being contrary to public policy. Unless it can
be established that the person executing the waiver voluntarily did so, with full
understanding of its contents, and with reasonable and credible consideration, the
same is not a valid and binding undertaking. Moreover, the burden to prove that the
waiver or quitclaim was voluntarily executed is with the employer.
PETITION for review on certiorari of the decision and resolution of the Court of
Appeals.
The facts are stated in the opinion of the Court.
   Miguel C. Inocencio, Jr. for petitioner.
   Neal J. Chua for respondent.
DEL CASTILLO, J.:
 
Before us is a Petition for Review on Certiorari assailing the September 26, 2012
Decision1 of the Court of Appeals (CA) in C.A.-G.R. S.P. No. 115396, which
annulled and set aside the March 29, 2010 2 and June 2, 20103 Resolutions of the
National Labor Relations Commission (NLRC) in NLRC LAC OFW-L-02-000071-
10, and concomitantly reinstated the November 27, 2009 Decision 4 of the Labor
Arbiter (LA) dismissing the Complaint for lack of merit.
_______________
1  CA Rollo, pp. 312-320; penned by Associate Justice Manuel M. Barrios and
concurred in by Associate Justices Remedios A. Salazar-Fernando and Normandie B.
Pizarro.
2  Id., at pp. 128-135; penned by Commissioner Napoleon M. Menese and
concurred in by Presiding Commissioner Raul T. Aquino and Commissioner Teresita
D. Castillon-Lora.
3  Id., at pp. 145-146.
4  Id., at pp. 103-108; penned by Labor Arbiter Virginia T. Luyas-Azarraga.
 
 
533
VOL. 814, JANUARY 18, 2017 533
Dagasdas vs. Grand Placement and GeneralServices Corporation
Also challenged is the January 28, 2013 Resolution 5denying the Motion for
Reconsideration filed by Rutcher T. Dagasdas (Dagasdas).
 
Factual Antecedents
Grand Placement and General Services Corp. (GPGS) is a licensed recruitment
or placement agency in the Philippines while Saudi Aramco (Aramco) is its
counterpart in Saudi Arabia. On the other hand, Industrial & Management
Technology Methods Co. Ltd. (ITM) is the principal of GPGS, a company existing in
Saudi Arabia.6
In November 2007, GPGS, for and on behalf of ITM, employed Dagasdas as
Network Technician. He was to be deployed in Saudi Arabia under a one-year
contract7 with a monthly salary of Saudi Riyal (SR) 5,112.00. Before leaving the
Philippines, Dagasdas underwent skill training8 and predeparture orientation as
Network Technician.9Nonetheless, his Job Offer10 indicated that he was accepted by
Aramco and ITM for the position of “Supt.”
Dagasdas contended that although his position under his contract was as a
Network Technician, he actually applied for and was engaged as a Civil Engineer
considering that his transcript of records, 11 diploma12 as well as
his curriculum vitae  showed that he had a degree in Civil Engineering, and his
13
work experiences were all related to this field. Purportedly, the position of Network
Technician was only for the
_______________
19
 5   Id., at pp. 353-355.  
6   Id., at pp. 21, 38.  
7   Id., at pp. 62-65. 535
8   Id., at p. 66. VOL. 814, JANUARY 18, 2017 535
9   Id., at p. 67.
Dagasdas vs. Grand Placement and GeneralServices Corporation
10  Id., at pp. 60-61.
11  Id., at pp. 54-57. tice20 indicating that his last day of work was on April 30, 2008, and he was
12  Id., at p. 58. dismissed pursuant to clause 17.4.3 of his contract, which provided that ITM
13  Id., at pp. 49-52. reserved the right to terminate any employee within the three-month probationary
  period without need of any notice to the employee.21
  Before his repatriation, Dagasdas signed a Statement of Quitclaim 22 with Final
534 Settlement23 stating that ITM paid him all the salaries and benefits for his services
from February 11, 2008 to April 30, 2008 in the total amount of SR7,156.80, and
534 SUPREME COURT REPORTS ANNOTATED ITM was relieved from all financial obligations due to Dagasdas.
Dagasdas vs. Grand Placement and GeneralServices Corporation On June 24, 2008, Dagasdas returned to the Philippines. 24 Thereafter, he filed an
purpose of securing a visa for Saudi Arabia because ITM could not support visa illegal dismissal case against GPGS, ITM, and Aramco.
application for Civil Engineers.14 Dagasdas accused GPGS, ITM, and Aramco of misrepresentation, which resulted
On February 8, 2008, Dagasdas arrived in Saudi Arabia. 15 Thereafter, he signed in the mismatch in the work assigned to him. He contended that such claim was
with ITM a new employment contract 16 which stipulated that the latter contracted supported by exchanges of electronic mail (e-mail) establishing that GPGS, ITM,
him as Superintendent or in any capacity within the scope of his abilities with salary and Aramco were aware of the job mismatch that had befallen him. 25 He also argued
of SR5,112.00 and allowance of SR2,045.00 per month. Under this contract, that although he was engaged as a project employee, he was still entitled to security
Dagasdas shall be placed under a three-month probationary period; and this new of tenure for the duration of his contract. He maintained that GPGS, ITM, and
contract shall cancel all contracts prior to its date from any source. Aramco merely invented “imaginary cause/s” to terminate him. Thus, he claimed
On February 11, 2008, Dagasdas reported at ITM’s worksite in Khurais, Saudi that he was dismissed without cause and due process of law.26
Arabia.17 There, he was allegedly given tasks suited for a Mechanical Engineer, GPGS, ITM, and Aramco countered that Dagasdas was legally dismissed. They
which were foreign to the job he applied for and to his work experience. Seeing that explained that Dagasdas was aware that he was employed as Network Technician but
he would not be able to perform well in his work, Dagasdas raised his concern to his he could not
Supervisor in the Mechanical Engineering Department. Consequently, he was _______________
transferred to the Civil Engineering Department, was temporarily given a position as
Civil Construction Engineer, and was issued an identification card good for one 20  Id., at p. 81.
month. Dagasdas averred that on March 9, 2008, he was directed to exit the worksite 21  Id., at p. 70.
but Rashid H. Siddiqui (Siddiqui), the Site Coordinator Manager, advised him to 22  Id., at p. 82.
remain in the premises, and promised to secure him the position he applied for. 23  Id., at pp. 83-84.
However, before Dagasdas’ case was investigated, Siddiqui had severed his 24  Id., at p. 21.
employment with ITM.18 25  Id., at pp. 92-93.
In April 2008, Dagasdas returned to Al-Khobar and stayed at the ITM 26  Id., at p. 42.
Office.19 Later, ITM gave him a termination no-  
_______________  
536
14  Id., at p. 39. 536 SUPREME COURT REPORTS ANNOTATED
15  Id., at p. 75.
Dagasdas vs. Grand Placement and GeneralServices Corporation
16  Id., at pp. 68-72.
17  Id., at p. 75. perform his work in accordance with the standards of his employer. They added that
18  Id., at pp. 39-40. Dagasdas was informed of his poor performance, and he conformed to his
19  Id., at p. 40. termination as evidenced by his quitclaim. 27 They also stressed that Dagasdas was
only a probationary employee since he worked for ITM for less than three months.28
20
 
Ruling of the Labor Arbiter
 
On November 27, 2009, the LA dismissed the case for lack of merit.
The LA pointed out that when Dagasdas signed his new employment contract in
Saudi Arabia, he accepted its stipulations, including the fact that he had to undergo
probationary status. She declared that this new contract was more advantageous for
Dagasdas as his position was upgraded to that of a Superintendent, and he was
likewise given an allowance of SR2,045.00 aside from his salary of SR5,112.00 per
month. According to the LA, for being more favorable, this new contract was not
prohibited by law. She also decreed that Dagasdas fell short of the expected work
performance; as such, his employer dismissed him as part of its management
prerogative.
Consequently, Dagasdas appealed to the NLRC.
 
Ruling of the National Labor
Relations Commission
On March 29, 2010, the NLRC issued a Resolution finding Dagasdas’ dismissal
illegal. The decretal portion of the NLRC Resolution reads:
WHEREFORE, the decision appealed from is hereby REVERSED, and the
respondent[s] are hereby
_______________
27  Id., at pp. 22-24.
28  Id., at p. 88.
 
 
537
VOL. 814, JANUARY 18, 2017 537
Dagasdas vs. Grand Placement and GeneralServices Corporation
ordered to pay the complainant the salaries corresponding to the unexpired portion of
his contract amounting to SR46,008 (SR5112 x 9 months, or from May 1, 2008 to
January 31, 2009), plus ten percent (10%) thereof as attorney’s fees. The respondents
are jointly and severally liable for the judgment awards, which are payable in
Philippine currency converted on the basis of the exchange rate prevailing at the time
of actual payment.
SO ORDERED.29
 
The NLRC stated that Dagasdas, who was a Civil Engineering graduate, was
“recruited on paper” by GPGS as Network Technician but the real understanding
between the parties was to hire him as Superintendent. It held that GPGS erroneously
recruited Dagasdas, and failed to inform him that he was hired as a “Mechanical
Superintendent” meant for a Mechanical Engineer. It declared that while ITM has the
prerogative to continue the employment of individuals only if they were qualified,
Dagasdas’ dismissal amounted to illegal termination since the mismatch between his
qualifications and the job given him was no fault of his.
The NLRC added that Dagasdas should not be made to suffer the consequences
of the miscommunication between GPGS and ITM considering that the government
obligates employment agencies recruiting Filipinos for overseas work to “select only
medically and technically qualified recruits.”30
On June 2, 2010, the NLRC denied the Motion for Reconsideration of its
Resolution dated March 29, 2010.
Undeterred, GPGS filed a Petition for Certiorari with the CA ascribing grave
abuse of discretion on the part of the NLRC in ruling that Dagasdas was illegally
dismissed.
_______________
29  Id., at p. 134.
30  Id., at p. 133.
 
538
538 SUPREME COURT REPORTS ANNOTATED
Dagasdas vs. Grand Placement and GeneralServices Corporation
 
Ruling of the Court of Appeals
 
On September 26, 2012, the CA set aside the NLRC Resolutions and reinstated
the LA Decision dismissing the case for lack of merit.
The CA could not accede to the conclusion that the real agreement between the
parties was to employ Dagasdas as Superintendent. It stressed that Dagasdas left the
Philippines pursuant to his employment contract indicating that he was to work as a
Network Technician; when he arrived in Saudi Arabia and signed a new contract for
the position of a Superintendent, the agreement was with no participation of GPGS,
and said new contract was only between Dagasdas and ITM. It emphasized that after
commencing work as Superintendent, Dagasdas realized that he could not perform
his tasks, and “[s]eemingly, it was [Dagasdas] himself who voluntarily withdrew
from his assigned work for lack of competence.” 31 It faulted the NLRC for falling to
consider that Dagasdas backed out as Superintendent on the excuse that the same
required the skills of a Mechanical Engineer.
In holding that Dagasdas’ dismissal was legal, the CA gave credence to
Dagasdas’ Statement of Quitclaim and Final Settlement. It ruled that for having
voluntarily accepted money from his employer, Dagasdas accepted his termination
and released his employer from future financial obligations arising from his past
employment with it.
On January 28, 2013, the CA denied Dagasdas’ Motion for Reconsideration.
Hence, Dagasdas filed this Petition raising these grounds:
21
[1] THE HONORABLE COURT OF APPEALS COMMITIED A REVERSIBLE
ERROR WHEN IT REVERSED THE FACTUAL FINDINGS OF THE
NATIONAL LABOR RELATIONS COMMISSION.32
_______________
31  Id., at p. 318.
32  Rollo, p. 26.
 
 
539
VOL. 814, JANUARY 18, 2017 539
Dagasdas vs. Grand Placement and GeneralServices Corporation
[2] THE HONORABLE COURT OF APPEALS PATENTLY ERRED WITH ITS
FINDINGS THAT THE CONTRACT SIGNED BY DAGASDAS IN AL KHOBAR
IS MORE ADVANTAGEOUS TO THE LATTER AND THAT IT WAS [H]IS
PERSONAL ACT OR DECISION [TO SIGN] THE SAME.33
[3] THE HONORABLE COURT OF APPEALS ALSO GRAVELY ERRED IN
FAULTING THE NLRC FOR ITS FAILURE TO INVALIDATE OR DISCUSS
THE FINAL SETTLEMENT AND STATEMENT OF QUITCLAIM SIGNED BY
[DAGASDAS].34
 
Dagasdas reiterates that he was only recruited “on paper” as a Network
Technician but the real agreement between him and his employer was to engage him
as Superintendent in the field of Civil Engineering, he being a Civil Engineering
graduate with vast experience in said field. He stresses that he was terminated
because of a “discipline mismatch” as his employer actually needed a Mechanical
(Engineer) Superintendent, not a Civil Engineer.
In addition, Dagasdas insists that he did not voluntarily back out from his work.
If not for the discipline mismatch, he could have performed his job as was expected
of him. He also denies that the new employment contract he signed while in Saudi
Arabia was more advantageous to him since the basic salary and allowance stipulated
therein are just the same with that in his Job Offer. He argues that the new contract
was even disadvantageous because it was inserted therein that he still had to undergo
probationary status for three months.
Finally, Dagasdas contends that the new contract he signed while in Saudi Arabia
was void because it was not approved by the Philippine Overseas Employment
Administration (POEA). He also claims that CA should have closely
_______________
33  Id., at p. 29.
34  Id., at p. 32.
 
 
540
540 SUPREME COURT REPORTS ANNOTATED
Dagasdas vs. Grand Placement and GeneralServices Corporation
examined his quitclaim because he only signed it to afford his plane ticket for his
repatriation.
On the other hand, GPGS maintains that Dagasdas was fully aware that he
applied for and was accepted as Network Technician. It also stresses that it was
Dagasdas himself who decided to accept from ITM a new job offer when he arrived
in Saudi Arabia. It further declares that Dagasdas’ quitclaim is valid as there is no
showing that he was compelled to sign it.
Issue
 
Was Dagasdas validly dismissed from work?
 
Our Ruling
 
The Petition is with merit.
As a rule, only questions of law may be raised in a petition under Rule 45 of the
Rules of Court. However, this rule allows certain exceptions, including a situation
where the findings of fact of the courts or tribunals below are conflicting. 35 In this
case, the CA and the NLRC arrived at divergent factual findings anent Dagasdas’
termination. As such, the Court deems it necessary to reexamine these findings and
determine whether the CA has sufficient basis to annul the NLRC Decision, and set
aside its finding that Dagasdas was illegally dismissed from work.
Moreover, it is well-settled that employers have the prerogative to impose
standards on the work quantity and quality of their employees and provide measures
to ensure compliance therewith. Noncompliance with work standards may thus be a
valid cause for dismissing an employee. Nonetheless, to ensure that employers will
not abuse their prerogatives, the same is tempered by security of tenure whereby the
_______________
35  Unicol Management Services, Inc. v. Malipot, G.R. No. 206562, January 21,
2015, 747 SCRA 191, 202-203.
 
 
541
VOL. 814, JANUARY 18, 2017 541
Dagasdas vs. Grand Placement and GeneralServices Corporation
employees are guaranteed substantive and procedural due process before they are
dismissed from work.36
Security of tenure remains even if employees, particularly the Overseas Filipino
Workers (OFW), work in a different jurisdiction. Since the employment contracts of
OFWs are perfected in the Philippines, and following the principle of lex loci
contractus (the law of the place where the contract is made), these contracts are
22
governed by our laws, primarily the Labor Code of the Philippines and its
implementing rules and regulations.37 At the same time, our laws generally apply
even to employment contracts of OFWs as our Constitution explicitly provides that
the State shall afford full protection to labor, whether local or overseas. 38 Thus, even
if a Filipino is employed abroad, he or she is entitled to security of tenure, among
other constitutional rights.39
In this case, prior to his deployment and while still in the Philippines, Dagasdas
was made to sign a POEA-approved contract with GPGS, on behalf of ITM; and
upon arrival in Saudi Arabia, ITM made him sign a new employment contract.
Nonetheless, this new contract, which was used as basis for dismissing Dagasdas, is
void.
First, Dagasdas’ new contract is in clear violation of his right to security of
tenure.
Under the Labor Code of the Philippines the following are the just causes for
dismissing an employee:
_______________
36  Sameer Overseas Placement Agency, Inc. v. Cabiles, G.R. No. 170139,
August 5, 2014, 732 SCRA 22, 41-42.
37  Id., at p. 42.
38  Constitution, Article XIII.
Section 3. 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.
39  Industrial Personnel & Management Services, Inc. (IPAMS) v. De Vera, G.R.
No. 205703, March 7, 2016, 785 SCRA 562, 581.
 
 
542
542 SUPREME COURT REPORTS ANNOTATED
Dagasdas vs. Grand Placement and GeneralServices Corporation
ARTICLE 297. [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
representative; and
(e) Other causes analogous to the foregoing.40
 
However, per the notice of termination given to Dagasdas, ITM terminated him
for violating clause 17.4.3 of his new contract, viz.:
17.4 The Company reserves the right to terminate this agreement without
serving any notice to the Consultant in the following cases:
x x x x
17.4.3 If the Consultant is terminated by company or its client within the
probation period of 3 months.41
 
Based on the foregoing, there is no clear justification for the dismissal of
Dagasdas other than the exercise of ITM’s right to terminate him within the
probationary period.
_______________
40  Labor Code of the Philippines, Amended and Renumbered, July 21, 2015.
41  CA Rollo, p. 70.
 
543
VOL. 814, JANUARY 18, 2017 543
Dagasdas vs. Grand Placement and GeneralServices Corporation
While our Civil Code recognizes that parties may stipulate in their contracts such
terms and conditions as they may deem convenient, these terms and conditions must
not be contrary to law, morals, good customs, public order or policy. 42 The above
cited clause is contrary to law because as discussed, our Constitution guarantees that
employees, local or overseas, are entitled to security of tenure. To allow employers
to reserve a right to terminate employees without cause is violative of this guarantee
of security of tenure.
Moreover, even assuming that Dagasdas was still a probationary employee when
he was terminated, his dismissal must still be with a valid cause. As regards a
probationary employee, his or her dismissal may be allowed only if there is just
cause or such reason to conclude that the employee fails to qualify as regular
employee pursuant to reasonable standards made known to the employee at the time
of engagement.43
Here, ITM failed to prove that it informed Dagasdas of any predetermined
standards from which his work will be gauged. 44 In the contract he signed while still
in the Philippines, Dagsadas was employed as Network Technician; on the other
hand, his new contract indicated that he was employed as Superintendent. However,
no job description — or such duties and responsibilities attached to either position —
was adduced in evidence. It thus means that the job for which Dagasdas was hired
was not definite from the beginning.
Indeed, Dagasdas was not sufficiently informed of the work standards for which
his performance will be measured. Even his position based on the job title given him
was not fully
_______________
23
 42  Civil Code of the Philippines.
Article 1306. The contracting 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. (1255a)
43  Supra note 36 at p. 46.
44  Id.
 
 
544
544 SUPREME COURT REPORTS ANNOTATED
Dagasdas vs. Grand Placement and GeneralServices Corporation
explained by his employer. Simply put, ITM failed to show that it set and
communicated work standards for Dagasdas to follow, and on which his efficiency
(or the lack thereof) may be determined.
Second, the new contract was not shown to have been processed through the
POEA. Under our Labor Code, employers hiring OFWs may only do so through
entities authorized by the Secretary of the Department of Labor and
Employment.45 Unless the employment contract of an OFW is processed through the
POEA, the same does not bind the concerned OFW because if the contract is not
reviewed by the POEA, certainly the State has no means of determining the
suitability of foreign laws to our overseas workers.46
This new contract also breached Dagasdas’ original contract as it was entered
into even before the expiration of the original contract approved by the POEA.
Therefore, it cannot supersede the original contract; its terms and conditions,
including reserving in favor of the employer the right to terminate an employee
without notice during the probationary period, are void.47
Third, under this new contract, Dagasdas was not afforded procedural due
process when he was dismissed from work.
As cited above, a valid dismissal requires substantive and procedural due
process. As regards the latter, the employer must give the concerned employee at
least two notices before
_______________
45  Article 18. Ban on Direct-Hiring.—No employer may hire a Filipino
worker for overseas employment except through the Boards and entities authorized
by the Secretary of Labor. Direct-hiring by members of the diplomatic corps,
international organizations and such other employers as may be allowed by the
Secretary of Labor is exempted from this provision. (Labor Code of the Philippines,
Amended & Renumbered, July 21, 2015)
46  Supra note 39.
47  Datuman v. First Cosmopolitan Manpower and Promotion Services, Inc.,
591 Phil. 662, 673-674; 571 SCRA 41, 54-55 (2008).
 
 
545
VOL. 814, JANUARY 18, 2017 545
Dagasdas vs. Grand Placement and GeneralServices Corporation
his or her termination. Specifically, the employer must inform the employee of the
cause or causes for his or her termination, and thereafter, the employer’s decision to
dismiss him. Aside from the notice requirement, the employee must be accorded the
opportunity to be heard.48
Here, no prior notice of purported infraction, and such opportunity to explain on
any accusation against him was given to Dagasdas. He was simply given a notice of
termination. In fact, it appears that ITM intended not to comply with the twin notice
requirement. As above quoted, under the new contract, ITM reserved in its favor the
right to terminate the contract without serving any notice to Dagasdas in specified
cases, which included such situation where the employer decides to dismiss the
employee within the probationary period. Without doubt, ITM violated the due
process requirement in dismissing an employee.
Lastly, while it is shown that Dagasdas executed a waiver in favor of his
employer, the same does not preclude him from filing this suit.
Generally, the employee’s waiver or quitclaim cannot prevent the employee from
demanding benefits to which he or she is entitled, and from filing an illegal dismissal
case. This is because waiver or quitclaim is looked upon with disfavor, and is
frowned upon for being contrary to public policy. Unless it can be established that
the person executing the waiver voluntarily did so, with full understanding of its
contents, and with reasonable and credible consideration, the same is not a valid and
binding undertaking. Moreover, the burden to prove that the waiver or quitclaim was
voluntarily executed is with the employer.49
_______________
49  Universal Staffing Services, Inc. v. National Labor Relations Commission,
581 Phil. 199, 209-210; 559 SCRA 221, 232 (2008).
48  EDI-Staffbuilders International, Inc. v. National Labor Relations
Commission, 563 Phil. 1, 28-29; 537 SCRA 409, 436 (2007).
 
546
546 SUPREME COURT REPORTS ANNOTATED
Dagasdas vs. Grand Placement and GeneralServices Corporation
In this case, however, neither did GPGS nor its principal, ITM, successfully
discharged its burden. GPGS and/or ITM failed to show that Dagasdas indeed
voluntarily waived his claims against the employer.
Indeed, even if Dagasdas signed a quitclaim, it does not necessarily follow that
he freely and voluntarily agreed to waive all his claims against his employer.
Besides, there was no reasonable consideration stipulated in said quitclaim
considering that it only determined the actual payment due to Dagasdas from
February 11, 2008 to April 30, 2008. Verily, this quitclaim, under the semblance of a
24
final settlement, cannot absolve GPGS nor ITM from liability arising from the
employment contract of Dagasdas.50
All told, the dismissal of Dagasdas was without any valid cause and due process
of law. Hence, the NLRC properly ruled that Dagasdas was illegally dismissed.
Evidently, it was an error on the part of the CA to hold that the NLRC committed
grave abuse of discretion amounting to lack or excess of jurisdiction when the NLRC
ruled for Dagasdas.
WHEREFORE, the Petition is GRANTED. The Decision dated September 26,
2012 and Resolution dated January 28, 2013 of the Court of Appeals in C.A.-G.R.
S.P. No. 115396 are REVERSED and SET ASIDE. Accordingly, the March 29,
2010 and June 2, 2010 Resolutions of the National Labor Relations Commission in
NLRC LAC OFW-L-02-000071-10 are REINSTATED.
SO ORDERED.
 Sereno (CJ., Chairperson), Leonardo-De Castro, Perlas-
Bernabe and Caguioa, JJ., concur.
Petition granted, judgment and resolution reversed and set aside.
_______________
50  Id.
 
547
VOL. 814, JANUARY 18, 2017 547
Dagasdas vs. Grand Placement and GeneralServices Corporation
Notes.—It is acknowledged that an employer has free rein and enjoys a wide
latitude of discretion to regulate all aspects of employment, including the prerogative
to instill discipline on his employees and to impose penalties, including dismissal, if
warranted, upon erring employees. (Caong, Jr. vs. Regualos, 640 SCRA 597 [2011])
The law protects both the welfare of employees and the prerogatives of
management. (The University of the Immaculate Conception vs. National Labor
Relations Commission, 640 SCRA 608 [2011])
——o0o——
G.R. No. 93666. April 22, 1991.*
GENERAL MILLING CORPORATION and EARL TIMOTHY CONE,
petitioners, vs. HON. RUBEN D. TORRES, in his capacity as Secretary of
Labor and Employment, HON. BIENVENIDO E. LAGUESMA, in his capacity
as Acting Secretary of Labor and Employment, and BASKETBALL COACHES
ASSOCIATION OF THE PHILIPPINES, respondents.
Contracts; Provisions of applicable laws especially those relating to matters
affected with public policy, are deemed written into contracts.—Neither can
petitioners validly claim that implementation of respondent Secretary’s decision
would amount to an impairment of the obligations of contracts. The provisions of the
Labor Code and its Implementing Rules and Regulations requiring alien employment
permits were in existence long before petitioners entered into their contract of
employment. It is firmly settled that provisions of applicable laws, especially
provisions relating to matters affected with public policy, are deemed written into
contracts. Private parties cannot constitutionally contract away the otherwise
applicable provisions of law.
Labor Law; The Department of Labor is the agency vested with jurisdiction to
determine the question of availability of local workers.—Petitioners’ contention that
respondent Secretary of Labor should have deferred to the findings of Commission
on Immigration and Deportation as to the necessity of employing petitioner Cone, is
again, bereft of legal basis. The Labor Code itself specifically empowers respondent
Secretary to make a determination as to the availability of the services of a “person
in the Philippines who is competent, able and willing at the time of application to
perform the services for which an alien is desired.” In short, the Department of Labor
is the agency vested with jurisdiction to determine the question of availability of
local workers. The constitutional validity of legal provisions granting such
jurisdiction and authority and requiring proof of non-availability of local nationals
able to carry out the duties of the position involved, cannot be seriously questioned.
PETITION for certiorari to review the decision of the Department of Labor and
Employment.
_______________
*
 THIRD DIVISION.
216
216  SUPREME COURT REPORTS ANNOTATED 
General Milling Corporation vs. Torres
The facts are stated in the resolution of the Court.
      Sobrevinas, Diaz, Hayudini & Bodegon Law Officefor petitioners.
      Rodrigo, Cuevas & De Borja for respondent BCAP.
RESOLUTION
FELICIANO, J.:
On 1 May 1989, the National Capital Region of the Department of Labor and
Employment issued Alien Employment Permit No. M-0689-3-535 in favor of
petitioner Earl Timothy Cone, a United States citizen, as sports consultant and
assistant coach for petitioner General Milling Corporation ("GMC").
On 27 December 1989, petitioners GMC and Cone entered into a contract of
employment whereby the latter undertook to coach GMC's basketball team.
25
On 15 January 1990, the Board of Special Inquiry of the Commission on
Immigration and Deportation approved petitioner Cone's application for a change of
admission status from temporary visitor to pre-arranged employee.
On 9 February 1990, petitioner GMC requested renewal of petitioner Cone's alien
employment permit. GMC also requested that it be allowed to employ Cone as full-
fledged coach. The DOLE Regional Director, Luna Piezas, granted the request on 15
February 1990.
On 18 February 1990, Alien Employment Permit No. M-02903-881, valid until 25
December 1990, was issued.
Private respondent Basketball Coaches Association of the Philippines ("BCAP")
appealed the issuance of said alien employment permit to the respondent Secretary of
Labor who, on 23 April 1990, issued a decision ordering cancellation of petitioner
Cone's employment permit on the ground that there was no showing that there is no
person in the Philippines who is competent, able and willing to perform the services
required nor that the hiring of petitioner Cone would redound to the national interest.
Petitioner GMC filed a Motion for Reconsideration and two (2) Supplemental
Motions for Reconsideration but said Motions were denied by Acting Secretary of
Labor Bienvenido E. Laguesma in an Order dated 8 June 1990.
Petitioners are now before the Court on a Petition for Certiorari, dated 14 June 1990,
alleging that:
1. respondent Secretary of Labor gravely abused his discretion when he
revoked petitioner Cone's alien employment permit; and
2. Section 6 (c), Rule XIV, Book I of the Omnibus Rules Implementing the
Labor Code is null and void as it is in violation of the enabling law as the
Labor Code does not empower respondent Secretary to determine if the
employment of an alien would redound to national interest.
Deliberating on the present Petition for Certiorari, the Court considers that
petitioners have failed to show any grave abuse of discretion or any act without or in
excess of jurisdiction on the part of respondent Secretary of Labor in rendering his
decision, dated 23 April 1990, revoking petitioner Cone's Alien Employment Permit.
The alleged failure to notify petitioners of the appeal filed by private respondent
BCAP was cured when petitioners were allowed to file their Motion for
Reconsideration before respondent Secretary of Labor.1
Petitioner GMC's claim that hiring of a foreign coach is an employer's prerogative
has no legal basis at all. Under Article 40 of the Labor Code, an employer seeking
employment of an alien must first obtain an employment permit from the Department
of Labor. Petitioner GMC's right to choose whom to employ is, of course, limited by
the statutory requirement of an alien employment permit.
Petitioners will not find solace in the equal protection clause of the Constitution. As
pointed out by the Solicitor-General, no comparison can be made between petitioner
Cone and Mr. Norman Black as the latter is "a long time resident of the country," and
thus, not subject to the provisions of Article 40 of the Labor Code which apply only
to "non-resident aliens." In any case, the term "non-resident alien" and its obverse
"resident alien," here must be given their technical connotation under our law on
immigration.
Neither can petitioners validly claim that implementation of respondent Secretary's
decision would amount to an impairment of the obligations of contracts. The
provisions of the Labor Code and its Implementing Rules and Regulations requiring
alien employment permits were in existence long before petitioners entered into their
contract of employment. It is firmly settled that provisions of applicable laws,
especially provisions relating to matters affected with public policy, are deemed
written into contracts.2 Private parties cannot constitutionally contract away the
otherwise applicable provisions of law.
Petitioners' contention that respondent Secretary of Labor should have deferred to the
findings of Commission on Immigration and Deportation as to the necessity of
employing petitioner Cone, is, again, bereft of legal basis. The Labor Code itself
specifically empowers respondent Secretary to make a determination as to the
availability of the services of a "person in the Philippines who is competent, able and
willing at the time of application to perform the services for which an alien is
desired."3
In short, the Department of Labor is the agency vested with jurisdiction to determine
the question of availability of local workers. The constitutional validity of legal
provisions granting such jurisdiction and authority and requiring proof of non-
availability of local nationals able to carry out the duties of the position involved,
cannot be seriously questioned.
Petitioners apparently also question the validity of the Implementing Rules and
Regulations, specifically Section 6 (c), Rule XIV, Book I of the Implementing Rules,
as imposing a condition not found in the Labor Code itself. Section 6 (c), Rule XIV,
Book I of the Implementing Rules, provides as follows:
Section 6. Issuance of Employment Permit –– the Secretary of Labor may
issue an employment permit to the applicant based on:
26
 a) Compliance by the applicant and his employer with the requirements of
Section 2 hereof;
b) Report of the Bureau Director as to the availability or non-availability of
any person in the Philippines who is competent and willing to do the job for
which the services of the applicant are desired.
(c) His assessment as to whether or not the employment of the applicant
will redound to the national interest;
(d) Admissibility of the alien as certified by the Commission on
Immigration and Deportation;
(e) The recommendation of the Board of Investments or other appropriate
government agencies if the applicant will be employed in preferred areas of
investments or in accordance with the imperative of economic development;
x x x           x x x          x x x
(Emphasis supplied)
Article 40 of the Labor Code reads as follows:
Art. 40. Employment per unit of non-resident aliens. –– Any alien seeking
admission to the Philippines for employment purposes and any domestic or
foreign employer who desires to engage an alien for employment in the
Philippines shall obtain an employment permit from the Department of
Labor.
The employment permit may be issued to a non-resident alien or to the
applicant employer after a determination of the non-availability of a person
in the Philippines who is competent, able and willing at the time of
application to perform the services for which the alien is desired.
For an enterprise registered in preferred areas of investments, said
employment permit may be issued upon recommendation of the government
agency charged with the supervision of said registered enterprise.
(Emphasis supplied)
Petitioners apparently suggest that the Secretary of Labor is not authorized to take
into account the question of whether or not employment of an alien applicant would
"redound to the national interest" because Article 40 does not explicitly refer to such
assessment. This argument (which seems impliedly to concede that the relationship
of basketball coaching and the national interest is tenuous and unreal) is not
persuasive. In the first place, the second paragraph of Article 40 says: "[t]he
employment permit may be issued to a non-resident alien or to the applicant
employer after a determination of the non-availability of a person in the Philippines
who is competent, able and willing at the time of application to perform the services
for which the alien is desired." The permissive language employed in the Labor Code
indicates that the authority granted involves the exercise of discretion on the part of
the issuing authority. In the second place, Article 12 of the Labor Code sets forth a
statement of objectives that the Secretary of Labor should, and indeed must, take into
account in exercising his authority and jurisdiction granted by the Labor Code,
Art. 12. Statement of Objectives. –– It is the policy of the State:
a) To promote and maintain a state of full employment through improved
manpower training, allocation and utilization;
x x x           x x x          x x x
c) To facilitate a free choice of available employment by persons seeking
work in conformity with the national interest;
d) To facilitate and regulate the movement of workers in conformity with
the national interest;
e) To regulate the employment of aliens, including the establishment of a
registration and/or work permit system;
x x x           x x x          x x x
Thus, we find petitioners' arguments on the above points of constitutional law too
insubstantial to require further consideration.1avvphi1
Petitioners have very recently manifested to this Court that public respondent
Secretary of Labor has reversed his earlier decision and has issued an Employment
Permit to petitioner Cone. Petitioners seek to withdraw their Petition
for Certiorari on the ground that it has become moot and academic.
While ordinarily this Court would dismiss a petition that clearly appears to have
become moot and academic, the circumstances of this case and the nature of the
questions raised by petitioners are such that we do not feel justified in leaving those
questions unanswered.4
27
Moreover, assuming that an alien employment permit has in fact been issued to
petitioner Cone, the basis of the reversal by the Secretary of Labor of his earlier
decision does not appear in the record. If such reversal is based on some view of
constitutional law or labor law different from those here set out, then such
employment permit, if one has been issued, would appear open to serious legal
objections.
ACCORDINGLY, the Court Resolved to DISMISS the Petition for certiorari for
lack of merit. Costs against petitioners.
Fernan, C.J., Bidin and Davide, Jr., JJ., concur.
G.R. No. 169207. March 25, 2010.*
WPP MARKETING COMMUNICATIONS, INC., JOHN STEEDMAN, MARK
WEBSTER, and NOMINADA LANSANG, petitioners, vs. JOCELYN M.
GALERA, respondent.
G.R. No. 169239. March 25, 2010.*
JOCELYN M. GALERA, petitioner, vs. WPP MARKETING
COMMUNICATIONS, INC., JOHN STEEDMAN, MARK WEBSTER, and
NOMINADA LANSANG, respondents.
Corporation Law; Corporate Officers; Under Section 25 of the Corporation
Code, the corporate officers are the president, secretary, treasurer and such other
officers as may be provided in the by-laws.—Corporate officers are given such
character either by the Corporation Code or by the corporation’s by-laws. Under
Section 25 of the Corporation Code, the corporate officers are the president,
secretary, treasurer and such other officers as may be provided in the by-laws. Other
officers are sometimes created by the charter or by-laws of a corporation, or the
board of directors may be empowered under the by-laws of a corporation to create
additional offices as may be necessary.
Labor Law; Termination of Employment; Employer must furnish the worker
sought to be dismissed with two written notices before termination of employment
can be legally effected; Failure to comply with the requirements taints the dismissal
with illegality.—The law further requires that the employer must furnish the worker
sought to be dismissed with two written notices before termination of employment
can be legally effected: (1) notice which apprises the employee of the particular acts
or omissions for which his dismissal is sought; and (2) the subsequent notice which
informs the employee of the employer’s decision to dismiss him. Failure to comply
with the requirements taints the dismissal with illegality. WPP’s acts clearly show
that Galera’s dismissal did not comply with the two-notice rule.
_______________
* SECOND DIVISION.
423
VOL. 616, MARCH 25, 2010 423
WPP Marketing Communications, Inc. vs. Galera
Same; Labor Code; Recruitment; Employment Permit; The law and the rules
are consistent in stating that the employment permit must be acquired prior to
employment.—This is Galera’s dilemma: Galera worked in the Philippines without a
proper work permit but now wants to claim employee’s benefits under Philippine
labor laws. The law and the rules are consistent in stating that the employment
permit must be acquired prior to employment. The Labor Code states: “Any alien
seeking admission to the Philippines for employment purposes and any domestic or
foreign employer who desires to engage an alien for employment in the Philippines
shall obtain an employment permit from the Department of Labor.”
PETITIONS for review on certiorari of the decision and resolution of the Court of
Appeals.
   The facts are stated in the opinion of the Court.
  Sycip, Salazar, Hernandez & Gatmaitan for WPP Marketing Communications,
Inc., John Steedman, Mark Webster and Nominada Lansang.
  Picazo, Buyco, Tan, Fider & Santos; Cervantes, Jurisprudencia and Partners;
and Egmedio J. Castillon, Jr.for Jocelyn M. Galera.
CARPIO, Acting C.J.:
The Case
G.R. Nos. 169207 and 169239 are petitions for review 1assailing the
Decision2 promulgated on 14 April 2005 as well as the Resolution 3 promulgated on 1
August 2005 of the Court of
_______________
1 Under Rule 45 of the 1997 Rules of Civil Procedure.
2 Rollo (G.R. No. 169207), pp. 10-43; Rollo, (G.R. No. 169239), pp. 40-73.
Penned by Associate Justice Vicente Q. Roxas with Associate Justices Renato C.
Dacudao and Lucas P. Bersamin, concurring; Associate Justice Jose Catral Mendoza,
concurring and dissenting; and Associate Justice Celia C. Librea-Leagogo,
dissenting.
3 Rollo (G.R. No. 169207), pp. 63-64; Rollo, (G.R. No. 169239), pp. 93-94.
Penned by Associate Justice Vicente Q. Roxas with Asso-
424
424 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
Appeals (appellate court) in CA-G.R. SP No. 78721. The appellate court granted and
gave due course to the petition filed by Jocelyn M. Galera (Galera). The appellate
court’s decision reversed and set aside that of the National Labor Relations
Commission (NLRC), and directed WPP Marketing Communications, Inc. (WPP) to
pay Galera backwages, separation pay, unpaid housing benefit, unpaid personal and
accident insurance benefits, cash value under the company’s pension plan, 30 days
28
paid holiday benefit, moral damages, exemplary damages, 10% of the total judgment annum, in accordance with the terms of the respective plans, as provided by
award as attorney’s fees, and costs of the suit. JWT Manila.
The Company will reimburse you and your spouse one way business
The Facts class air tickets from USA to Manila and the related shipping and relocation
cost not exceeding US$5,000 supported by proper documentation. If you
The appellate court narrated the facts as follows: leave the Company within one year, you will reimburse the Company in full
“Petitioner is Jocelyn Galera (GALERA), a [sic] American citizen who was for all costs of the initial relocation as described therein.
recruited from the United States of America by private respondent John Steedman, You will participate in the JWT Pension Plan under the terms of this plan,
Chairman-WPP Worldwide and Chief Executive Officer of Mindshare, Co., a the Company reserves the right to transfer this benefit to a Mindshare Pension
corporation based in Hong Kong, China, to work in the Philippines for private Plan in the future, if so required.
respondent WPP Marketing Communications, Inc. (WPP), a corporation registered    8. Holidays
and operating under the laws of Philippines. GALERA accepted the offer and she You are entitled to 20 days paid holiday in addition to public holidays per
signed an Employment Contract entitled “Confirmation of Appointment and calendar year to be taken at times agreed with the Company. Carry-over of
Statement of Terms and Conditions” (Annex “B” to Petition for Certiorari). The unused accrued holiday entitlement into a new holiday year will not normally
relevant portions of the contract entered into between the parties are as follows: be allowed. No payment will be made for holidays not taken. On termination
Particulars: of your employment, unless you have been summarily dismissed, you will be
Name:                    Jocelyn M. Galera entitled to receive payment for unused accrued holiday pay. Any holiday
Address:                 163 Mediterranean Avenue taken in excess of your entitlement shall be deducted from your final salary
                              Hayward, CA 94544 payment.426
Position:                  Managing Director 426 SUPREME COURT REPORTS ANNOTATED
                               Mindshare Philippines
WPP Marketing Communications, Inc. vs. Galera
Annual Salary:        Peso 3,924,000
   9. Leave Due to Sickness or Injury
Start Date:              1 September 1999
The maximum provision for sick leave is 15 working days per calendar
_______________
year.
   12. Invention/Know-How
 ciate Justices Renato C. Dacudao and Lucas P. Bersamin, concurring; Associate
Any discovery, invention, improvement in procedure, trademark, trade
Justice Jose Catral Mendoza, concurring and dissenting; and Associate Justice Celia
name, designs, copyrights or get-ups made, discovered or created by you
C. Librea-Leagogo, dissenting.
during the continuance of your employment hereunder relating to the
425
business of the Company shall belong to and shall be the absolute property of
VOL. 616, MARCH 25, 2010 425 the Company. If required to do so by the Company (whether during or after
WPP Marketing Communications, Inc. vs. Galera the termination of your employment) you shall at the expense of the company
Commencement Date: 1 September 1999 execute all instruments and do all things necessary to vest in ownership for
(for continuous service) all other rights, title and interests (including any registered rights therein) in
Office: Mindshare Manila such discovery, invention, improvement in procedure, trademark, trade name,
6. Housing Allowance design, copyright or get-up in the Company (or its Nominee) absolutely and
The Company will provide suitable housing in Manila at a maximum cost as sole beneficial owner.
(including management fee and other associated costs) of Peso 576,000 per    14. Notice.
annum. The first three months of your employment will be a trial period during
   7. Other benefits. which either you or the Company may terminate your employment on one
The Company will provide you with a fully maintained company car and week’s notice. If at the end of that period, the Company is satisfied with your
a driver. performance, you will become a permanent employee. Thereafter you will
The Company will continue to provide medical, health, life and personal give Company and the Company will give you three months notice of
accident insurance plans, to an amount not exceeding Peso 300,000 per termination of employment. The above is always subject to the following: (1)
the Company’s right to terminate the contract of employment on no or short

29
 notice where you are in breach of contract; (2) your employment will at any
event cease without notice on your retirement date when you are 60 years of
age.
                           SIGNED JOCELYN M. GALERA 8-16-99
                                  Date of Borth [sic] 12-25-55
Employment of GALERA with private respondent WPP became effective
on September 1, 1999 solely on the instruction of the CEO and upon signing of the
contract, without any further action from the Board of Directors of private
respondent WPP.
Four months had passed when private respondent WPP filed before the Bureau of
Immigration an application for petitioner
427
VOL. 616, MARCH 25, 2010 427
WPP Marketing Communications, Inc. vs. Galera
GALERA to receive a working visa, wherein she was designated as Vice President
of WPP. Petitioner alleged that she was constrained to sign the application in order
that she could remain in the Philippines and retain her employment.
Then, on December 14, 2000, petitioner GALERA alleged she was verbally
notified by private respondent STEEDMAN that her services had been terminated
from private respondent WPP. A termination letter followed the next day.”4
On 3 January 2001, Galera filed a complaint for illegal dismissal, holiday pay,
service incentive leave pay, 13th month pay, incentive plan, actual and moral
damages, and attorney’s fees against WPP and/or John Steedman (Steedman), Mark
Webster (Webster) and Nominada Lansang (Lansang). The case was docketed as
NLRC NCR Case No. 30-01-00044-01.
The Labor Arbiter’s Ruling
In his Decision dated 31 January 2002, Labor Arbiter Edgardo M. Madriaga
(Arbiter Madriaga) held WPP, Steedman, Webster, and Lansang liable for illegal
dismissal and damages. Arbiter Madriaga stated that Galera was not only illegally
dismissed but was also not accorded due process. Arbiter Madriaga explained, thus:
“[WPP] failed to observe the two-notice rule. [WPP] through respondent Steedman
for a five (5) minute meeting on December 14, 2000 where she was verbally told that
as of that day, her employment was being terminated. [WPP] did not give [Galera] an
opportunity to defend herself and explain her side. [Galera] was even prohibited
from reporting for work that day and was told not to report for work the next day as
it would be awkward for her and respondent Steedman to be in the same premises
after her termination. [WPP] only served [Galera] her written notice of termination
only on 15 December 2001, one day after she was verbally apprised thereof.”
_______________
4 Rollo (G.R. No. 169207), pp. 12-15; Rollo (G.R. No. 169239), pp. 42-45.
428
428 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
The law mandates that the dismissal must be properly done otherwise, the
termination is gravely defective and may be declared unlawful as we hereby hold
[Galera’s] dismissal to be illegal and unlawful. Where there is no showing of a clear,
valid and legal cause for the termination of employment, the law considers the matter
a case of illegal dismissal and the burden is on the employer to prove that the
termination was for a valid or authorized cause. The law mandates that both the
substantive and procedural aspects of due process should be observed. The facts
clearly show that respondents were remiss on both aspects. Perforce, the dismissal is
void and unlawful.
xxxx
Considering the work performance and achievements of [Galera] for the year
2000, we do not find any basis for the alleged claim of incompetence by herein
respondents. Had [Galera] been really incompetent, she would not have been able to
generate enormous amounts [sic] of revenues and business for [WPP]. She also
appears to be well liked as a leader by her subordinates, who have come forth in
support of [Galera]. These facts remain undisputed by respondents.
A man’s job being a property right duly protected by our laws, an employer who
deprives an employee [of] the right to defend himself is liable for damages consistent
with Article 32 of the Civil Code. To allow an employer to terminate the
employment of his worker based merely on allegations without proof places the
[employee] in an uncertain situation. The unflinching rule in illegal dismissal cases is
that the employer bears the burden of proof.
In the instant case, respondents have not been able to muster evidence to counter
[Galera’s] allegations. [Galera’s] allegations remain and stand absent proof from
respondents rebutting them. Hence, our finding of illegal dismissal against
respondents who clearly have conspired in bad faith to deprive [Galera] of her right
to substantive and procedural due process.”5
The dispositive portion of Arbiter Madriaga’s decision reads as follows:
_______________
5 Rollo (G.R. No. 169207), pp. 337-341; Rollo (G.R. No. 169239), pp. 299-303.
429
VOL. 616, MARCH 25, 2010 429
WPP Marketing Communications, Inc. vs. Galera
“WHEREFORE, premises considered, we hereby hold herein respondents liable
for illegal dismissal and damages, and award to [Galera], by virtue of her expatriate
status, the following:
a. Reinstatement without loss of seniority rights.
b. Backwages amounting to $120,000 per year at P50.00 to US $1 exchange
rate, 13th month pay, transportation and housing benefits.
c. Remuneration for business acquisitions amounting to Two Million Eight
Hundred Fifty Thousand Pesos (P2,850,000.00) and Media Plowback
30
 Incentive equivalent to Three Million Pesos (P3,000,000.00) or a total of not
less than One Hundred Thousand US Dollars ($100,000.00).
d. US Tax Protection of up to 35% coverage equivalent to Thirty Eight
Thousand US Dollars ($38,000).
e. Moral damages including implied defamation and punitive damages
equivalent to Two Million Dollars (US$2,000,000.00).
f. Exemplary damages equivalent to One Million Dollars ($1,000,000.00).
g. Attorney’s fees of 10% of the total award herein.
SO ORDERED.”6
The Ruling of the NLRC
The First Division of the NLRC reversed the ruling of Arbiter Madriaga. In its
Decision7 promulgated on 19 February 2003, the NLRC stressed that Galera was
WPP’s Vice-President, and therefore, a corporate officer at the time she was
removed by the Board of Directors on 14 December 2000. The NLRC stated thus:
_______________
6 Rollo (G.R. No. 169207), p. 344; Rollo (G.R. No. 169239), p. 306.
7 Rollo (G.R. No. 169239), pp. 140-150. Per Curiam decision signed by
Commissioners Roy V. Señeres and Victoriano R. Calaycay.
430
430 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
“It matters not that her having been elected by the Board to an added position of
being a member of the Board of Directors did not take effect as her May 31, 2000
election to such added position was conditioned to be effective upon approval by
SEC of the Amended By-Laws, an approval which took place only in February 21,
2001, i.e., after her removal on December 14, 2000. What counts is, at the time of
her removal, she continued to be WPP’s Vice President, a corporate officer, on hold
over capacity.
Ms. Galera’s claim that she was not a corporate officer at the time of her removal
because her May 31, 2000 election as Vice President for Media, under WPP’s
Amended By-Laws, was subject to the approval by the Securities and Exchange
Commission and that the SEC approved the Amended By-Laws only in February
2001. Such claim is unavailing. Even if Ms. Galera’s subsequent election as Vice
President for Media on May 31, 2000 was subject to approval by the SEC, she
continued to hold her previous position as Vice President under the December 31,
1999 election until such time that her successor is duly elected and qualified. It is a
basic principle in corporation law, which principle is also embodied in WPP’s by-
laws, that a corporate officer continues to hold his position as such until his
successor has been duly elected and qualified. When Ms. Galera was elected as Vice
President on December 31, 1999, she was supposed to have held that position until
her successor has been duly elected and qualified. The record shows that Ms. Galera
was not replaced by anyone. She continued to be Vice President of WPP with the
same operational title of Managing Director for Mindshare and continued to perform
the same functions she was performing prior to her May 31, 2000 election.
In the recent case of Dily Dany Nacpil v. International Broadcasting Corp., the
definition of corporate officer for purposes of intra-corporate controversy was even
broadened to include a Comptroller/Assistant Manager who was appointed by the
General Manager, and whose appointment was later approved by the Board of
Directors. In this case, the position of comptroller was not even expressly mentioned
in the By-Laws of the corporation, and yet, the Supreme Court found him to be a
corporate officer. The Court ruled that—
(since) petitioner’s appointment as comptroller required the approval and
formal action of IBC’s Board of Directors to become valid, it is clear
therefore that petitioner is a corporate officer whose dismissal may be the
subject of a controversy
431
VOL. 616, MARCH 25, 2010 431
WPP Marketing Communications, Inc. vs. Galera
cognizable by the SEC... Had the petitioner been an ordinary employee, such
board action would not have been required.
Such being the case, the imperatives of law require that we hold that the Arbiter
below had no jurisdiction over Galera’s case as, again, she was a corporate officer at
the time of her removal.
WHEREFORE, the appeals of petitioner from the Decision of Labor Arbiter
Edgardo Madriaga dated January 31, 2002 and his Order dated March 21, 2002,
respectively, are granted. The January 31, 2002 decision of the Labor Arbiter is set
aside for being null and void and the temporary restraining order we issued on April
24, 2002 is hereby made permanent. The complaint of Jocelyn Galera is dismissed
for lack of jurisdiction.
SO ORDERED.”8
In its Resolution9 promulgated on 4 June 2003, the NLRC further stated:
“We are fully convinced that this is indeed an intra-corporate dispute which is
beyond the labor arbiter’s jurisdiction. These consolidated cases clearly [involve] the
relationship between a corporation and its officer and is properly within the
definition of an intra-corporate relationship which, under P.D. No. 902-A, is within
the jurisdiction of the SEC (now the commercial courts). Such being the case, We are
constrained to rule that the Labor Arbiter below had no jurisdiction over Ms.
Galera’s complaint for illegal dismissal.
WHEREFORE, the motion for reconsideration filed by Ms. Galera is hereby
denied for lack of merit. We reiterate our February 19, 2003 Decision setting aside
the Labor Arbiter’s Decision dated January 31, 2002 for being null and void.
SO ORDERED.”10
Galera assailed the NLRC’s decision and resolution before the appellate court
and raised a lone assignment of error.
_______________
31
 8  Id., at pp. 148-150.
9  Rollo (G.R. No. 169207), pp. 502-505; Rollo (G.R. No. 169239), pp. 151-154.
10 Rollo (G.R. No. 169207), pp. 504-505; Rollo (G.R. No. 169239), pp. 153-
154.
432
432 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
“The National Labor Relations Commission acted with grave abuse of discretion
amounting to lack or excess of jurisdiction when it reversed the decision of the Labor
Arbiter not on the merits but for alleged lack of jurisdiction.”11
The Decision of the Appellate Court
The appellate court reversed and set aside the decision of the NLRC. The
appellate court ruled that the NLRC’s dismissal of Galera’s appeal is not in accord
with jurisprudence. A person could be considered a “corporate officer” only if
appointed as such by a corporation’s Board of Directors, or if pursuant to the power
given them by either the Articles of Incorporation or the By-Laws.12
The appellate court explained:
“A corporation, through its board of directors, could only act in the manner and
within the formalities, if any, prescribed by its charter or by the general law. If the
action of the Board is ultra vires such is motu proprio void ab initio and without
legal effect whatsoever. The by-laws of a corporation are its own private laws which
substantially have the same effect as the laws of the corporation. They are, in effect,
written into the charter. In this sense, they beome part of the fundamental law of the
corporation with which the corporation and its directors and officers must comply.
Even if petitioner GALERA had been appointed by the Board of Directors on
December 31, 1999, private respondent WPP’s By-Laws provided for only one Vice-
President, a position already occupied by private respondent Webster. The same
defect also stains the Board of Directors’ appointment of petitioner GALERA as a
Director of the corporation, because at that time the By-Laws provided for only five
directors. In addition, the By-laws only empowered the Board of Directors to appoint
a general manager and/or assistant general manager as corporate officers in addition
to a chairman, president, vice-president and treasurer. There is no mention of a
corporate officer entitled “Managing Director.”
_______________
11 Rollo (G.R. No. 169207), p. 18.
12 Rollo (G.R. No. 169207), p. 21; Rollo (G.R. No. 169239), p. 51.
433
VOL. 616, MARCH 25, 2010 433
WPP Marketing Communications, Inc. vs. Galera
     Hence, when the Board of Directors enacted the Resolutions of December 31,
1999 and May 31, 2000, it exceeded its authority under the By-Laws and are,
therefore, ultra vires. Although private respondent WPP sought to amend these
defects by filing Amended By-Laws with the Securities and Exchange Commission,
they did not validate the ultra vires resolutions because the Amended By-Laws did
not take effect until February 16, 2001, when it was approved by the SEC. Since by-
laws operate only prospectively, they could not validate the ultra vires resolutions.”13
The dispositive portion of the appellate court’s decision reads:
“WHEREFORE, the petition is hereby GRANTED and GIVEN DUE COURSE.
The assailed Decision of the National Labor Relations Commission is hereby
REVERSED and SET ASIDE and a new one is entered DIRECTING private
respondent WPP MARKETING COMMUNICATIONS, INC. to:
1. Pay [Galera] backwages at the peso equivalent of US$120,000.00 per annum
plus three months from her summary December 14, 2000 dismissal up to
March 14, 2001 because three months notice is required under the contract,
plus 13th month pay, bonuses and general increases to which she would have
been normally entitled, had she not been dismissed and had she not been
forced to stop working, including US tax protection of up to 35% coverage
which she had been enjoying as an expatriate;
2. Pay x x x GALERA the peso equivalent of US$185,000.00 separation pay (1
½ years);
3. Pay x x x GALERA any unpaid housing benefit for the 18 ½ months of her
employment in the service to the Company as an expatriate in Manila,
Philippines at the rate of P576,000 per year; unpaid personal and accident
insurance benefits for premiums at the rate of P300,000.00 per year; whatever
cash value in the JWT Pension Plan; and thirty days paid holiday benefit
under the contract for the 1 ½ calendar years with the Company;
_______________
13 Rollo (G.R. No. 169207), pp. 33-34; Rollo (G.R. No. 169239), pp. 63-64.
434
434 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
4. Pay x x x GALERA the reduced amount of PhP2,000,000.00 as moral
damages;
5. Pay [Galera] the reduced amount of PhP1,000,000.00 as exemplary damages;
6. Pay [Galera] an amount equivalent to 10% of the judgment award as
attorney’s fees;
7. Pay the cost of the suit.
SO ORDERED.”14
Respondents filed a motion for reconsideration on 5 May 2005. Galera filed a
motion for partial reconsideration and/or clarification on the same date. The appellate
court found no reason to revise or reverse its previous decision and subsequently
denied the motions in a Resolution promulgated on 1 August 2005.15
The Issues
32
 WPP, Steedman, Webster, and Lansang raised the following grounds in G.R. No.
169207:
I. The Court of Appeals seriously erred in ruling that the NLRC has jurisdiction
over [Galera’s] complaint because she was not an employee. [Galera] was a
corporate officer of WPP from the beginning of her term until her removal
from office.
II. Assuming arguendo that the Court of Appeals correctly ruled that the NLRC
has jurisdiction over [Galera’s] complaint, it should have remanded the case
to the Labor Arbiter for reception of evidence on the merits of the case.
III. [Galera] is an alien, hence, can never attain a regular or permanent working
status in the Philippines.
_______________
14 Rollo (G.R. No. 169207), p. 42; Rollo (G.R. No. 169239), p. 72.
15 Rollo (G.R. No. 169207), pp. 63-64; Rollo (G.R. No. 169239), pp. 93-94.
435
VOL. 616, MARCH 25, 2010 435
WPP Marketing Communications, Inc. vs. Galera
IV. [Galera] is not entitled to recover backwages, other benefits and damages
from WPP.16
On the other hand, in G.R. No. 169239, Galera raised the following grounds in
support of her petition:
“The CA decision should be consistent with Article 279 of the Labor Code and
applicable jurisprudence, that full backwages and separation pay (when in lieu of
reinstatement), should be reckoned from time of dismissal up to time of
reinstatement (or payment of separation pay, in case separation instead of
reinstatement is awarded).
Accordingly, petitioner Galera should be awarded full backwages and separation pay
for the period from 14 December 2000 until the finality of judgment by the
respondents, or, at the very least, up to the promulgation date of the CA decision.
The individual respondents Steedman, Webster and Lansang must be held solidarily
liable with respondent WPP for the wanton and summary dismissal of petitioner
Galera, to be consistent with law and jurisprudence as well as the specific finding of
the CA of bad faith on the part of respondents.”17
This Court ordered the consolidation of G.R. Nos. 169207 and 169239 in a
resolution dated 16 January 2006.18
The Ruling of the Court
In its consolidated comment, the Office of the Solicitor General (OSG)
recommended that (A) the Decision dated 14 April 2005 of the appellate court
finding (1) Galera to be a regular employee of WPP; (2) the NLRC to have
jurisdiction over the present case; and (3) WPP to have illegally dismissed Galera, be
affirmed; and (B) the case remanded to the Labor Arbiter for the computation of the
correct monetary award. Despite the OSG’s recommendations, we see that Galera’s
_______________
16 Rollo (G.R. No. 169207), pp. 83-84.
17 Rollo (G.R. No. 169239), pp. 18-19.
18 Rollo (G.R. No. 169207), p. 879; Rollo (G.R. No. 169239), p. 470.
436
436 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
failure to seek an employment permit prior to her employment poses a serious
problem in seeking relief before this Court. Hence, we settle the various issues raised
by the parties for the guidance of the bench and bar.
Whether Galera is an Employee or a Corporate Officer
Galera, on the belief that she is an employee, filed her complaint before the
Labor Arbiter. On the other hand, WPP, Steedman, Webster and Lansang contend
that Galera is a corporate officer; hence, any controversy regarding her dismissal is
under the jurisdiction of the Regional Trial Court. We agree with Galera.
Corporate officers are given such character either by the Corporation Code or by
the corporation’s by-laws. Under Section 25 of the Corporation Code, the corporate
officers are the president, secretary, treasurer and such other officers as may be
provided in the by-laws.19 Other officers are sometimes created by the charter or by-
laws of a corporation, or the board of directors may be empowered under the by-laws
of a corporation to create additional offices as may be necessary.
An examination of WPP’s by-laws resulted in a finding that Galera’s
appointment as a corporate officer (Vice-President with the operational title of
Managing Director of Mindshare) during a special meeting of WPP’s Board of
Directors is an appointment to a non-existent corporate office. WPP’s by-laws
provided for only one Vice-President. At the time of Galera’s appointment on 31
December 1999, WPP already had one Vice-President in the person of Webster.
Galera cannot be said to be a director of WPP also because all five directorship
positions provided in the by-laws are already occupied. Finally, WPP cannot rely on
its Amended By-Laws to support its argument that Galera is a corporate officer. The
Amended By-Laws provided for more than one Vice-President and for
_______________
19 Easycall Communications Phils., Inc. v. King, G.R. No. 145901, 15 December
2005, 478 SCRA 102.
437
VOL. 616, MARCH 25, 2010 437
WPP Marketing Communications, Inc. vs. Galera
33
two additional directors. Even though WPP’s stockholders voted for the amendment
on 31 May 2000, the SEC approved the amendments only on 16 February 2001.
Galera was dismissed on 14 December 2000. WPP, Steedman, Webster, and Lansang
did not present any evidence that Galera’s dismissal took effect with the action of
WPP’s Board of Directors.
The appellate court further justified that Galera was an employee and not a
corporate officer by subjecting WPP and Galera’s relationship to the four-fold test:
(a) the selection and engagement of the employee; (b) the payment of wages; (c) the
power of dismissal; and (d) the employer’s power to control the employee with
respect to the means and methods by which the work is to be accomplished. The
appellate court found:
“x x x Sections 1 and 4 of the employment contract mandate where and how
often she is to perform her work; sections 3, 5, 6 and 7 show that wages she receives
are completely controlled by x x x WPP; and sections 10 and 11 clearly state that she
is subject to the regular disciplinary procedures of x x x WPP.
Another indicator that she was a regular employee and not a corporate officer is
Section 14 of the contract, which clearly states that she is a permanent employee—
not a Vice-President or a member of the Board of Directors.
 x x x x
Another indication that the Employment Contract was one of regular
employment is Section 12, which states that the rights to any invention, discovery,
improvement in procedure, trademark, or copyright created or discovered by
petitioner GALERA during her employment shall automatically belong to private
respondent WPP. Under Republic Act 8293, also known as the Intellectual Property
Code, this condition prevails if the creator of the work subject to the laws of patent
or copyright is an employee of the one entitled to the patent or copyright.
Another convincing indication that she was only a regular employee and not a
corporate officer is the disciplinary procedure under Sections 10 and 11 of the
Employment Contract, which states that her right of redress is through Mindshare’s
Chief Executive Officer
438
438 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
for the Asia-Pacific. This implies that she was not under the disciplinary control of
private respondent WPP’s Board of Directors (BOD), which should have been the
case if in fact she was a corporate officer because only the Board of Directors could
appoint and terminate such a corporate officer.
Although petitioner GALERA did sign the Alien Employment Permit from the
Department of Labor and Employment and the application for a 9(g) visa with the
Bureau of Immigration—both of which stated that she was private respondent’s
WPP’ Vice President—these should not be considered against her.
Assuming arguendothat her appointment as Vice-President was a valid act, it must
be noted that these appointments occurred after she was hired as a regular employee.
After her appointments, there was no appreciable change in her duties.”20
Whether the Labor Arbiter and the NLRC
have jurisdiction over the present case
Galera being an employee, then the Labor Arbiter and the NLRC have
jurisdiction over the present case. Article 217 of the Labor Code provides:
“Jurisdiction of Labor Arbiters and the Commission.—(a) Except as otherwise
provided under this Code, the Labor Arbiters shall have original and exclusive
jurisdiction to hear and decide x x x the following cases involving all workers,
whether agricultural or non-agricultural:
1.  Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases that workers may
file involving wages, rates of pay, hours of work and other terms and
conditions of employment;
4. Claims for actual, moral, exemplary and other forms of damages arising from
the employer-employee relations;
_______________
20 Rollo (G.R. No. 169207), pp. 34-36; Rollo (G.R. No. 169239), pp. 64-66.
439
VOL. 616, MARCH 25, 2010 439
WPP Marketing Communications, Inc. vs. Galera
5. Cases arising from any violation of Article 264 of this Code, including
questions involving the legality of strikes and lockouts;
6. Except claims for Employees Compensation, Social Security, Medicare and
other maternity benefits, all other claims, arising from employer-employee
relations, including those of persons in domestic or household service,
involving an amount exceeding five thousand pesos (P5,000.00) regardless of
whether accompanied with a claim for reinstatement.
(b) The Commission shall have exclusive appellate jurisdiction over all
cases decided by Labor Arbiters.
(c) Cases arising from the interpretation of collective bargaining
agreements and those arising from the interpretation or enforcement
of company personnel policies shall be disposed of by the Labor
Arbiter by referring the same to the grievance machinery and
voluntary arbitration as may be provided in said agreements.”
In contrast, Section 5.2 of Republic Act No. 8799, or the Securities Regulation
Code, states:
“The Commission’s jurisdiction over all cases enumerated under Section 5 of
Presidential Decree No. 902-A is hereby transferred to the courts of general
jurisdiction or the appropriate Regional Trial Court: Provided, That the Supreme
Court in the exercise of its authority may designate the Regional Trial Court
branches that shall exercise jurisdiction over these cases. The Commission shall
retain jurisdiction over pending cases involving intra-corporate disputes submitted
34
for final resolution which should be resolved within one year from the enactment of
this Code. The Commission shall retain jurisdiction over pending suspension of
payments/rehabilitation cases filed as of 30 June 2000 until finally disposed.”
The pertinent portions of Section 5 of Presidential Decree No. 902-A, mentioned
above, states:
b) Controversies arising out of intra-corporate or partnership relations, between
and among stockholders, mem-
440
440 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
bers or associates; between any or all of them and the corporation, partnership or
association of which they are stockholders, members or associates, respectively; and
between such corporation, partnership or association and the state insofar as it
concerns their individual franchise or right to exist as such entity;
c) Controversies in the election or appointments of directors, trustees, officers
or managers of such corporations, partnerships or associations.
Whether WPP illegally dismissed Galera
WPP’s dismissal of Galera lacked both substantive and procedural due process.
Apart from Steedman’s letter dated 15 December 2000 to Galera, WPP failed to
prove any just or authorized cause for Galera’s dismissal. Steedman’s letter to Galera
reads:
‘The operations are currently in a shamble. There is lack of leadership and
confidence in your abilities from within, our agency partners and some clients.
Most of the staff I spoke with felt they got more guidance and direction from Minda
than yourself. In your role as Managing Director, that is just not acceptable.
I believe your priorities are mismanaged. The recent situation where you felt an
internal strategy meeting was more important than a new business pitch is a good
example.
You failed to lead and advise on the two new business pitches. In both cases, those
involved sort (sic) Minda’s input. As I discussed with you back in July, my directive
was for you to lead and review all business pitches. It is obvious [that] confusion
existed internally right up until the day of the pitch.
The quality output is still not to an acceptable standard, which was also part of my
directive that you needed to focus on back in July.
I do not believe you understand the basic skills and industry knowledge required to
run a media special operation.”21
_______________
21 Rollo (G.R. No. 169239), p. 267.
441
VOL. 616, MARCH 25, 2010 441
WPP Marketing Communications, Inc. vs. Galera
WPP, Steedman, Webster, and Lansang, however, failed to substantiate the
allegations in Steedman’s letter. Galera, on the other hand, presented documentary
evidence22 in the form of congratulatory letters, including one from Steedman, which
contents are diametrically opposed to the 15 December 2000 letter.
The law further requires that the employer must furnish the worker sought to be
dismissed with two written notices before termination of employment can be legally
effected: (1) notice which apprises the employee of the particular acts or omissions
for which his dismissal is sought; and (2) the subsequent notice which informs the
employee of the employer’s decision to dismiss him. Failure to comply with the
requirements taints the dismissal with illegality. 23WPP’s acts clearly show that
Galera’s dismissal did not comply with the two-notice rule.
Whether Galera is entitled to the monetary award
WPP, Steedman, Webster, and Lansang argue that Galera is not entitled to
backwages because she is an alien. They further state that there is no guarantee that
the Bureau of Immigration and the Department of Labor and Employment will
continue to grant favorable rulings on the applications for a 9(g) visa and an Alien
Employment Permit after the expiry of the validity of Galera’s documents on 31
December 2000. WPP’s argument is a circular argument, and assumes what it
attempts to prove. Had WPP not dismissed Galera, there is no doubt in our minds
that WPP would have taken action for the approval of documents required for
Galera’s continued employment.
_______________
22 Id., at pp. 237-266.
23 Pepsi-Cola Bottling Co. v. NLRC, G.R. No. 101900, 23 June 1992, 210 SCRA
277, 286.
442
442 SUPREME COURT REPORTS ANNOTATED
WPP Marketing Communications, Inc. vs. Galera
This is Galera’s dilemma: Galera worked in the Philippines without a proper
work permit but now wants to claim employee’s benefits under Philippine labor
laws.
“Employment of GALERA with private respondent WPP became effective
on September 1, 1999 solely on the instruction of the CEO and upon signing of the
contract, without any further action from the Board of Directors of private
respondent WPP.
Four months had passed when private respondent WPP filed before the
Bureau of Immigration an application for petitioner GALERA to receive a
working visa, wherein she was designated as Vice President of WPP. Petitioner
alleged that she was constrained to sign the application in order that she could remain
in the Philippines and retain her employment.”24
The law and the rules are consistent in stating that the employment permit must
be acquired prior to employment. The Labor Code states: “Any alien seeking
admission to the Philippines for employment purposes and any domestic or foreign
35
employer who desires to engage an alien for employment in the Philippines shall
obtain an employment permit from the Department of Labor.” 25 Section 4, Rule XIV,
Book 1 of the Implementing Rules and Regulations provides:
“Employment permit required for entry.—No alien seeking employment,
whether as a resident or non-resident, may enter the Philippines without first
securing an employment permit from the Ministry. If an alien enters the country
under a non-working visa and wishes to be employed thereafter, he may only be
allowed to be employed upon presentation of a duly approved employment permit.”

Galera cannot come to this Court with unclean hands. To grant Galera’s prayer is to
sanction the violation of the Philippine labor laws requiring aliens to secure work
permits before their employment. We hold that the status quo must prevail in the
present case and we leave the parties where they are. This ruling, however, does not
bar Galera from seeking relief from other jurisdictions.

WHEREFORE, we PARTIALLY GRANT the petitions in G.R. Nos. 169207 and

169239. We SET ASIDE the Decision of the Court of Appeals promulgated on 14
April 2005 as well as the Resolution promulgated on 1 August 2005 in CA-G.R. SP
No. 78721. 

SO ORDERED.

G.R. No. 114337. September 29, 1995.*

NITTO ENTERPRISES, petitioner, vs. NATIONAL LABOR RELATIONS
COMMISSION, and ROBERTO CAPILI, respondents.
Labor Law; Apprenticeship Agreements; Prior approval by the Department of
Labor and Employment of the proposed apprenticeship program is a condition sine
qua non before an apprenticeship agreement can be validly entered into.—In the
case at bench, the apprenticeship agreement between petitioner and private
respondent was executed on May 28, 1990 allegedly employing the latter as an
apprentice in the trade of “care maker/molder.” On the same date, an apprenticeship
program was prepared by petitioner and submitted to the Department of Labor and
Employment. However, the apprenticeship Agreement was filed only on June 7,
1990. Notwithstanding the absence of ap-
_______________
*
 FIRST DIVISION.
655
VOL. 248, SEPTEMBER 29, 1995  655 
Nitto Enterprises vs. National Labor Relations Commission

36
 proval by the Department of Labor and Employment, the apprenticeship
agreement was enforced the day it was signed. Based on the evidence before us,
petitioner did not comply with the requirements of the law. It is mandated that
apprenticeship agreements entered into by the employer and apprentice shall be
entered only in accordance with the apprenticeship program duly approved by the
Minister of Labor and Employment. Prior approval by the Department of Labor and
Employment of the proposed apprenticeship program is, therefore, a condition sine
qua nonbefore an apprenticeship agreement can be validly entered into.
Same; Same; Where the apprenticeship agreement has no force and effect, the
worker hired as apprentice should be considered as a regular employee.—Hence,
since the apprenticeship agreement between petitioner and private respondent has no
force and effect in the absence of a valid apprenticeship program duly approved by
the DOLE, private respondent’s assertion that he was hired not as an apprentice but
as a delivery boy (“kargador” or “pahinante”) deserves credence. He should rightly
be considered as a regular employee of petitioner as defined by Article 280 of the
Labor Code.
Same; Dismissals; Due Process; The twin requirements of due process,
substantive and procedural, must be complied with before valid dismissal exists,
otherwise the dismissal becomes void.—There is an abundance of cases wherein the
Court ruled that the twin requirements of due process, substantive and procedural,
must be complied with, before valid dismissal exists. Without which, the dismissal
becomes void. The twin requirements of notice and hearing constitute the essential
elements of due process. This simply means that the employer shall afford the
worker ample opportunity to be heard and to defend himself with the assistance of
his representative, if he so desires. Ample opportunity connotes every kind of
assistance that management must accord the employee to enable him to prepare
adequately for his defense including legal representation.
SPECIAL CIVIL ACTION in the Supreme Court. Certiorari.
The facts are stated in the opinion of the Court.
     Sinforoso R. Pagunsan for petitioner.
     Ma. Elena Enly B. Nazareta representative of private respondent.
KAPUNAN, J.:
This petition for certiorari under Rule 65 of the Rules of Court seeking to annul the
decision1 rendered by public respondent National Labor Relations Commission,
which reversed the decision of the Labor Arbiter.
Briefly, the facts of the case are as follows:
Petitioner Nitto Enterprises, a company engaged in the sale of glass and aluminum
products, hired Roberto Capili sometime in May 1990 as an apprentice machinist,
molder and core maker as evidenced by an apprenticeship agreement2 for a period of
six (6) months from May 28, 1990 to November 28, 1990 with a daily wage rate of
P66.75 which was 75% of the applicable minimum wage.
At around 1:00 p.m. of August 2, 1990, Roberto Capili who was handling a piece of
glass which he was working on, accidentally hit and injured the leg of an office
secretary who was treated at a nearby hospital.
Later that same day, after office hours, private respondent entered a workshop within
the office premises which was not his work station. There, he operated one of the
power press machines without authority and in the process injured his left thumb.
Petitioner spent the amount of P1,023.04 to cover the medication of private
respondent.
The following day, Roberto Capili was asked to resign in a letter3 which reads:
August 2,
Wala siyang tanggap ng utos mula sa superbisor at wala siyang
experiensa kung papaano gamitin and "TOOL" sa pagbuhat ng
salamin, sarili niyang desisyon ang paggamit ng tool at may
disgrasya at nadamay pa ang isang sekretarya ng kompanya.
Sa araw ding ito limang (5) minute ang nakakalipas mula alas-
singko ng hapon siya ay pumasok sa shop na hindi naman sakop ng
kanyang trabaho. Pinakialaman at kinalikot ang makina at
nadisgrasya niya ang kanyang sariling kamay.
Nakagastos ang kompanya ng mga sumusunod:
Emergency and doctor fee P715.00
Medecines (sic) and others 317.04
Bibigyan siya ng kompanya ng Siyam na araw na libreng sahod
hanggang matanggal ang tahi ng kanyang kamay.
Tatanggapin niya ang sahod niyang anim na araw, mula ika-30 ng
Hulyo at ika-4 ng Agosto, 1990.
Ang kompanya ang magbabayad ng lahat ng gastos pagtanggal ng
tahi ng kanyang kamay, pagkatapos ng siyam na araw mula ika-2
ng Agosto.
37
 Sa lahat ng nakasulat sa itaas, hinihingi ng kompanya ang kanyang
resignasyon, kasama ng kanyang comfirmasyon at pag-ayon na ang
lahat sa itaas ay totoo.
 
Naiintindihan ko ang lahat ng nakasulat sa itaas, at ang lahat ng ito
ay aking pagkakasala sa hindi pagsunod sa alintuntunin ng
kompanya.
On August 3, 1990 private respondent executed a Quitclaim and Release in favor of
petitioner for and in consideration of the sum of P1,912.79.4
Three days after, or on August 6, 1990, private respondent formally filed before the
NLRC Arbitration Branch, National Capital Region a complaint for illegal dismissal
and payment of other monetary benefits.
On October 9, 1991, the Labor Arbiter rendered his decision finding the termination
of private respondent as valid and dismissing the money claim for lack of merit. The
dispositive portion of the ruling reads:
WHEREFORE, premises considered, the termination is valid and
for cause, and the money claims dismissed for lack of merit.
The respondent however is ordered to pay the complainant the
amount of P500.00 as financial assistance.
SO ORDERED.5
Labor Arbiter Patricio P. Libo-on gave two reasons for ruling that the dismissal of
Roberto Capilian was valid. First, private respondent who was hired as an apprentice
violated the terms of their agreement when he acted with gross negligence resulting
in the injury not only to himself but also to his fellow worker. Second, private
respondent had shown that "he does not have the proper attitude in employment
particularly the handling of machines without authority and proper training.6
On July 26, 1993, the National Labor Relations Commission issued an order
reversing the decision of the Labor Arbiter, the dispositive portion of which reads:
WHEREFORE, the appealed decision is hereby set aside. The
respondent is hereby directed to reinstate complainant to his work
last performed with backwages computed from the time his wages
were withheld up to the time he is actually reinstated. The Arbiter
of origin is hereby directed to further hear complainant's money
claims and to dispose them on the basis of law and evidence
obtaining.
SO ORDERED.7
The NLRC declared that private respondent was a regular
employee of petitioner by ruling thus:
As correctly pointed out by the complainant, we cannot understand
how an apprenticeship agreement filed with the Department of
Labor only on June 7, 1990 could be validly used by the Labor
Arbiter as basis to conclude that the complainant was hired by
respondent as a plain "apprentice" on May 28, 1990. Clearly,
therefore, the complainant was respondent's regular employee
under Article 280 of the Labor Code, as early as May 28,1990,
who thus enjoyed the security of tenure guaranteed in Section 3,
Article XIII of our 1987 Constitution.
The complainant being for illegal dismissal (among others) it then
behooves upon respondent, pursuant to Art. 227(b) and as ruled in
Edwin Gesulgon vs. NLRC, et al. (G.R. No. 90349, March 5, 1993,
3rd Div., Feliciano, J.) to prove that the dismissal of complainant
was for a valid cause. Absent such proof, we cannot but rule that
the complainant was illegally dismissed.8
On January 28, 1994, Labor Arbiter Libo-on called for a conference at which only
private respondent's representative was present.
On April 22, 1994, a Writ of Execution was issued, which reads:
NOW, THEREFORE, finding merit in [private respondent's]
Motion for Issuance of the Writ, you are hereby commanded to
proceed to the premises of [petitioner] Nitto Enterprises and Jovy
Foster located at No. l 74 Araneta Avenue, Portero, Malabon,
Metro Manila or at any other places where their properties are
38
 located and effect the reinstatement of herein [private respondent]
to his work last performed or at the option of the respondent by
payroll reinstatement.
You are also to collect the amount of P122,690.85 representing his
backwages as called for in the dispositive portion, and turn over
such amount to this Office for proper disposition.
Petitioner filed a motion for reconsideration but the same was
denied.
Hence, the instant petition — for certiorari.
The issues raised before us are the following:
I 1990. Notwithstanding the absence of approval by the Department of Labor and
WHETHER OR NOT PUBLIC RESPONDENT NLRC
COMMITTED GRAVE ABUSE OF DISCRETION IN
HOLDING THAT PRIVATE RESPONDENT WAS NOT AN
APPRENTICE.
II
WHETHER OR NOT PUBLIC RESPONDENT NLRC
COMMITTED GRAVE ABUSE OF DISCRETION IN
HOLDING THAT PETITIONER HAD NOT ADEQUATELY
PROVEN THE EXISTENCE OF A VALID CAUSE IN
TERMINATING THE SERVICE OF PRIVATE RESPONDENT.
We find no merit in the petition.
Petitioner assails the NLRC's finding that private respondent Roberto Capili cannot
plainly be considered an apprentice since no apprenticeship program had yet been
filed and approved at the time the agreement was executed.
Petitioner further insists that the mere signing of the apprenticeship agreement
already established an employer-apprentice relationship.
Petitioner's argument is erroneous.
The law is clear on this matter. Article 61 of the Labor Code provides:
Contents of apprenticeship agreement. — Apprenticeship
agreements, including the main rates of apprentices, shall conform
to the rules issued by the Minister of Labor and Employment. The
period of apprenticeship shall not exceed six months.
Apprenticeship agreements providing for wage rates below the
legal minimum wage, which in no case shall start below 75% per
cent of the applicable minimum wage, may be entered into only in
accordance with apprenticeship program duly approved by the
Minister of Labor and Employment. The Ministry shall develop
standard model programs of apprenticeship. (emphasis supplied)
In the case at bench, the apprenticeship agreement between petitioner and private
respondent was executed on May 28, 1990 allegedly employing the latter as an
apprentice in the trade of "care maker/molder." On the same date, an apprenticeship
program was prepared by petitioner and submitted to the Department of Labor and
Employment. However, the apprenticeship Agreement was filed only on June 7,
Employment, the apprenticeship agreement was enforced the day it was signed.
Based on the evidence before us, petitioner did not comply with the requirements of
the law. It is mandated that apprenticeship agreements entered into by the employer
and apprentice shall be entered only in accordance with the apprenticeship program
duly approved by the Minister of Labor and Employment.
Prior approval by the Department of Labor and Employment of the proposed
apprenticeship program is, therefore, a condition sine quo non before an
apprenticeship agreement can be validly entered into.
The act of filing the proposed apprenticeship program with the Department of Labor
and Employment is a preliminary step towards its final approval and does not
instantaneously give rise to an employer-apprentice relationship.
Article 57 of the Labor Code provides that the State aims to "establish a national
apprenticeship program through the participation of employers, workers and
government and non-government agencies" and "to establish apprenticeship
standards for the protection of apprentices." To translate such objectives into
existence, prior approval of the DOLE to any apprenticeship program has to be
secured as a condition sine qua non before any such apprenticeship agreement can
be fully enforced. The role of the DOLE in apprenticeship programs and agreements
cannot be debased.
Hence, since the apprenticeship agreement between petitioner and private respondent
has no force and effect in the absence of a valid apprenticeship program duly
approved by the DOLE, private respondent's assertion that he was hired not as an
39
apprentice but as a delivery boy ("kargador" or "pahinante") deserves credence. He
should rightly be considered as a regular employee of petitioner as defined by Article
280 of the Labor Code:
Art. 280. Regular and Casual Employment. — The provisions of
written agreement to the contrary notwithstanding and regardless
of the oral agreement of the parties, an employment shall be
deemed to be regular where the employee has been engaged to
perform activities which are usually necessary or desirable in the
usual business or trade of the employer, except where the
employment has been fixed for a specific project or undertaking
the completion or termination of which has been determined at the
time of the engagement of the employee or where the work or
services to be performed is seasonal in nature and the employment
is for the duration of the season.
An employment shall be deemed to be casual if it is not covered by
the preceding paragraph: Provided, That, any employee who has
rendered at least one year of service, whether such service is
continuous or broken, shall be considered a regular employee with
respect to the activity in which he is employed and his employment
shall continue while such activity exists. (Emphasis supplied)
and pursuant to the constitutional mandate to "protect the rights of workers
and promote their welfare."9
Petitioner further argues that, there is a valid cause for the dismissal of private
respondent.
There is an abundance of cases wherein the Court ruled that the twin requirements of
due process, substantive and procedural, must be complied with, before valid
dismissal exists. 10 Without which, the dismissal becomes void.
The twin requirements of notice and hearing constitute the essential elements of due
process. This simply means that the employer shall afford the worker ample
opportunity to be heard and to defend himself with the assistance of his
representative, if he so desires.
Ample opportunity connotes every kind of assistance that management must accord
the employee to enable him to prepare adequately for his defense including legal
representation. 11
As held in the case of Pepsi-Cola Bottling Co., Inc. v. NLRC: 12
The law requires that the employer must furnish the worker sought
to be dismissed with two (2) written notices before termination of
employee can be legally effected: (1) notice which apprises the
employee of the particular acts or omissions for which his
dismissal is sought; and (2) the subsequent notice which informs
the employee of the employer's decision to dismiss him (Sec. 13,
BP 130; Sec. 2-6 Rule XIV, Book V, Rules and Regulations
Implementing the Labor Code as amended). Failure to comply with
the requirements taints the dismissal with illegality. This procedure
is mandatory, in the absence of which, any judgment reached by
management is void and in existent (Tingson, Jr. vs. NLRC, 185
SCRA 498 [1990]; National Service Corp. vs. NLRC, 168 SCRA
122; Ruffy vs. NLRC. 182 SCRA 365 [1990]).
The fact is private respondent filed a case of illegal dismissal with the Labor Arbiter
only three days after he was made to sign a Quitclaim, a clear indication that such
resignation was not voluntary and deliberate.
Private respondent averred that he was actually employed by petitioner as a delivery
boy ("kargador" or "pahinante").
He further asserted that petitioner "strong-armed" him into signing the
aforementioned resignation letter and quitclaim without explaining to him the
contents thereof. Petitioner made it clear to him that anyway, he did not have a
choice. 13
Petitioner cannot disguise the summary dismissal of private respondent by
orchestrating the latter's alleged resignation and subsequent execution of a Quitclaim
and Release. A judicious examination of both events belies any spontaneity on
private respondent's part.
WHEREFORE, finding no abuse of discretion committed by public respondent
National Labor Relations Commission, the appealed decision is hereby AFFIRMED.
SO ORDERED.
G.R. No. 75112. August 17, 1992.*
FILAMER CHRISTIAN INSTITUTE, petitioner, vs. HON. INTERMEDIATE
APPELLATE COURT, HON. ENRIQUE P. SUPLICO, in his capacity as Judge
of the Regional Trial Court, Branch XIV, Roxas City and POTENCIANO
KAPUNAN, SR., respondents.
Labor Law; Employer-Employee relationship; In relation to the school,
Funtecha was an employee even if he was assigned to clean the school premises for
40
only two (2) hours in the morning of each school day.—It is undisputed that
Funtecha was a working student, being a part-time janitor and a scholar of petitioner
Filamer. He was, in  preserved; on payroll; and on the exclusion of working scholars from, and inclusion
________________
* THIRD DIVISION.
638
638  SUPREME COURT REPORTS ANNOTATED  a civil suit for damages instituted by an injured person during a vehicular accident
Filamer Christian Institute vs. Intermediate Appellate Court
relation to the school, an employee even if he was assigned to clean the school
premises for only two (2) hours in the morning of each school day.
Same; Same; Driving the vehicle to and from the house of the school president
where both Allan and Funtecha reside is an act in furtherance of the interest of the
petitioner-school.—Driving the vehicle to and from the house of the school president
where both Allan and Funtecha reside is an act in furtherance of the interest of the
petitioner-school. Allan’s job demands that he drive home the school jeep so he can
use it to fetch students in the morning of the next school day.
Same; Same; Court is constrained to conclude that the act of Funtecha in
taking over the steering wheel was done for and in behalf of his employer for which
act the petitioner school cannot deny any responsibility by arguing that it was done
beyond the scope of his janitorial duties.—In learning how to drive while taking the
vehicle home in the direction of Allan’s house, Funtecha definitely was not having a
joy ride. Funtecha was not driving for the purpose of his enjoyment or for a “frolic of
his own” but ultimately, for the service for which the jeep was intended by the
petitioner school. (See L. Battistoni v. Thomas, Can SC 144, 1 D.L.R.. 577, 80 ALR
722 [1932]; See also Association of Baptists for World Evangelism, Inc. v.
Fieldmen’s Insurance Co., Inc. 124 SCRA 618 [1983]). Therefore, the Court is
constrained to conclude that the act of Funtecha in taking over the steering wheel
was one done for and in behalf of his employer for which act the petitioner-school
cannot deny any responsibility by arguing that it was done beyond the scope of his
janitorial duties. The clause “within the scope of their assigned tasks” for purposes of
raising the presumption of liability of an employer, includes any act done by an
employee, in furtherance of the interests of the employer or for the account of the
employer at the time of the infliction of the injury or damage.
Same; Same; Section 14, Rule X, Book III of the Rules implementing the Labor
Code promulgated only for the purpose of administering and enforcing the
provisions of the Labor Code on conditions of employment.—Section 14, Rule X,
Book III of the Rules implementing the Labor Code, on which the petitioner anchors
its defense, was promulgated by the Secretary of Labor and Employment only for the
purpose of administering and enforcing the provisions of the Labor Code on
conditions of employment. Particularly, Rule X of Book III provides guidelines on
the manner by which the powers of the Labor  act, it being sufficient that the act of driving at the time of the incident was for the
639
VOL. 212, AUGUST 17, 1992  639  was not acting within the scope of his janitorial duties does not relieve the petitioner
Filamer Christian Institute vs. Intermediate Appellate Court
Secretary shall be exercised; on what records should be kept; maintained and
of resident physicians in the employment coverage as far as compliance with the
substantive labor provisions on working conditions, rest periods, and wages, is
concerned.
Same; Same; Section 14, Rule X, Book III of the Rules not the decisive law in
against a working student of a school and against the school itself.—In other words,
Rule X is merely a guide to the enforcement of the substantive law on labor. The
Court, thus, makes the distinction and so holds that Section 14, Rule X, Book III of
the Rules is not the decisive law in a civil suit for damages instituted by an injured
person during a vehicular accident against a working student of a school and against
the school itself.
Same; Same; An implementing rule on labor cannot be used by an employer
as a shield to avoid liability under the substantive provisions of the Civil Code.—The
present case does not deal with a labor dispute on conditions of employment between
an alleged employee and an alleged employer. It invokes a claim brought by one for
damages for injury caused by the patently negligent acts of a person, against both
doer-employee and his employer. Hence, the reliance on the implementing rule on
labor to disregard the primary liability of an employer under Article 2180 of the Civil
Code is misplaced. An implementing rule on labor cannot be used by an employer as
a shield to avoid liability under the substantive provisions of the Civil Code.
Same; Civil Law; Negligence; There is evidence to show that there exists in
the present case an extra-contractual obligation arising from the negligence or
reckless imprudence of a person whose acts or omission are imputable by a legal
fiction to others who are in a position to exercise an absolute or limited control over
him.—There is evidence to show that there exists in the present case an extra-
contractual obligation arising from the negligence or reckless imprudence of a person
“whose acts or omissions are imputable, by a legal fiction, to other(s) who are in a
position to exercise an absolute or limited control over (him).”
Same; Same; Same; Fact that Funtecha was not the school driver or was not
acting within the scope of his janitorial duties does not relieve the petitioner of the
burden of rebutting the presumption juris tantum that there was negligence on its
part either in the selection of a
640
640  SUPREME COURT REPORTS ANNOTATED 
Filamer Christian Institute vs. Intermediate Appellate Court
servant or employee or in the supervision over him.—Funtecha is an employee
of petitioner Filamer. He need not have an official appointment for a driver’s
position in order that the petitioner may be held responsible for his grossly negligent
benefit of the petitioner. Hence, the fact that Funtecha was not the school driver or
41
of the burden of rebutting the presumption juris tantum that there was negligence on
its part either in the selection of a servant or employee, or in the supervision over
him. The petitioner has failed to show proof of its having exercised the required
diligence of a good father of a family over its employees Funtecha and Allan.
Same; Same; Same; Supervision includes the formulation of suitable rules and
regulation for the guidance of its employees and the issuance of proper instructions
intended for the protection of the public and persons with whom the employer has
relations through his employees.—The Court reiterates that supervision includes the
formulation of suitable rules and regulation for the guidance of its employees and the
issuance of proper instructions intended for the protection of the public and persons
with whom the employer has relations through his employees.
Same; Same; Same; Employer is expected to impose upon its employees the
necessary discipline called for in the performance of any act indispensable to the
business and beneficial to their employer.—An employer is expected to impose upon
its employees the necessary discipline called for in the performance of any act
indispensable to the business and beneficial to their employer.
Same; Same; Same; In the absence of evidence that the petitioner had
exercised the diligence of a good father of a family in the supervision of its
employees, the law imposes upon it the vicarious liability for acts or omissions of its
employees.—The petitioner, thus, has an obligation to pay damages for injury arising
from the unskilled manner by which Funtecha drove the vehicle. (Cangco v. Manila
Railroad Co., 38 Phil. 768, 772 [1918]). In the absence of evidence that the petitioner
had exercised the diligence of a good father of a family in the supervision of its
employees, the law imposes upon it the vicarious liability for acts or omissions of its
employees.
Same; Same; Same; Liability of the employer under Article 2180 is primary
and solidary.—The liability of the employer is, under Article 2180, primary and
solidary. However, the employer shall have  attorney's fees.
641
VOL. 212, AUGUST 17, 1992  641  It is undisputed that Funtecha was a working student, being a part-time janitor and a
Filamer Christian Institute vs. Intermediate Appellate Court
recourse against the negligent employee for whatever damages are paid to the
heirs of the plaintiff.
PETITION for reconsideration of the decision of the then Intermediate Appellate
Court.
The facts are stated in the opinion of the Court.
     Bedona & Bedona Law Office for petitioner.
     Rhodora G. Kapunan for private respondents.
GUTIERREZ, JR., J.:
The private respondents, heirs of the late Potenciano Kapunan, seek reconsideration
of the decision rendered by this Court on October 16, 1990 (Filamer Christian
Institute v. Court of Appeals, 190 SCRA 477) reviewing the appellate court's
conclusion that there exists an employer-employee relationship between the
petitioner and its co-defendant Funtecha. The Court ruled that the petitioner is not
liable for the injuries caused by Funtecha on the grounds that the latter was not an
authorized driver for whose acts the petitioner shall be directly and primarily
answerable, and that Funtecha was merely a working scholar who, under Section 14,
Rule X, Book III of the Rules and Regulations Implementing the Labor Code is not
considered an employee of the petitioner.
The private respondents assert that the circumstances obtaining in the present case
call for the application of Article 2180 of the Civil Code since Funtecha is no doubt
an employee of the petitioner. The private respondents maintain that under Article
2180 an injured party shall have recourse against the servant as well as the petitioner
for whom, at the time of the incident, the servant was performing an act in
furtherance of the interest and for the benefit of the petitioner. Funtecha allegedly did
not steal the school jeep nor use it for a joy ride without the knowledge of the school
authorities.
After a re-examination of the laws relevant to the facts found by the trial court and
the appellate court, the Court reconsiders its decision. We reinstate the Court of
Appeals' decision penned by the late Justice Desiderio Jurado and concurred in by
Justices Jose C. Campos, Jr. and Serafin E. Camilon. Applying Civil Code
provisions, the appellate court affirmed the trial court decision which ordered the
payment of the P20,000.00 liability in the Zenith Insurance Corporation policy,
P10,000.00 moral damages, P4,000.00 litigation and actual expenses, and P3,000.00
scholar of petitioner Filamer. He was, in relation to the school, an employee even if
he was assigned to clean the school premises for only two (2) hours in the morning
of each school day.
Having a student driver's license, Funtecha requested the driver, Allan Masa, and
was allowed, to take over the vehicle while the latter was on his way home one late
afternoon. It is significant to note that the place where Allan lives is also the house of
his father, the school president, Agustin Masa. Moreover, it is also the house where
Funtecha was allowed free board while he was a student of Filamer Christian
Institute.
Allan Masa turned over the vehicle to Funtecha only after driving down a road,
negotiating a sharp dangerous curb, and viewing that the road was clear. (TSN, April
4, 1983, pp. 78-79) According to Allan's testimony, a fast moving truck with glaring
42
lights nearly hit them so that they had to swerve to the right to avoid a collision.
Upon swerving, they heard a sound as if something had bumped against the vehicle,
but they did not stop to check. Actually, the Pinoy jeep swerved towards the
pedestrian, Potenciano Kapunan who was walking in his lane in the direction against
vehicular traffic, and hit him. Allan affirmed that Funtecha followed his advise to
swerve to the right. (Ibid., p. 79) At the time of the incident (6:30 P.M.) in Roxas
City, the jeep had only one functioning headlight.
Allan testified that he was the driver and at the same time a security guard of the
petitioner-school. He further said that there was no specific time for him to be off-
duty and that after driving the students home at 5:00 in the afternoon, he still had to
go back to school and then drive home using the same vehicle.
Driving the vehicle to and from the house of the school president where both Allan
and Funtecha reside is an act in furtherance of the interest of the petitioner-school.
Allan's job demands that he drive home the school jeep so he can use it to fetch
students in the morning of the next school day.
It is indubitable under the circumstances that the school president had knowledge
that the jeep was routinely driven home for the said purpose. Moreover, it is not
improbable that the school president also had knowledge of Funtecha's possession of
a student driver's license and his desire to undergo driving lessons during the time
that he was not in his classrooms.
In learning how to drive while taking the vehicle home in the direction of Allan's
house, Funtecha definitely was not having a joy ride. Funtecha was not driving for
the purpose of his enjoyment or for a "frolic of his own" but ultimately, for the
service for which the jeep was intended by the petitioner school. (See L. Battistoni v.
Thomas, Can SC 144, 1 D.L.R. 577, 80 ALR 722 [1932]; See also Association of
Baptists for World Evangelism, Inc. v. Fieldmen's Insurance Co., Inc. 124 SCRA
618 [1983]). Therefore, the Court is constrained to conclude that the act of Funtecha
in taking over the steering wheel was one done for and in behalf of his employer for
which act the petitioner-school cannot deny any responsibility by arguing that it was
done beyond the scope of his janitorial duties. The clause "within the scope of their
assigned tasks" for purposes of raising the presumption of liability of an employer,
includes any act done by an employee, in furtherance of the interests of the employer
or for the account of the employer at the time of the infliction of the injury or
damage. (Manuel Casada, 190 Va 906, 59 SE 2d 47 [1950]) Even if somehow, the
employee driving the vehicle derived some benefit from the act, the existence of a
presumptive liability of the employer is determined by answering the question of
whether or not the servant was at the time of the accident performing any act in
furtherance of his master's business. (Kohlman v. Hyland, 210 NW 643, 50 ALR
1437 [1926]; Jameson v. Gavett, 71 P 2d 937 [1937])
Section 14, Rule X, Book III of the Rules implementing the Labor Code, on which
the petitioner anchors its defense, was promulgated by the Secretary of Labor and
Employment only for the purpose of administering and enforcing the provisions of
the Labor Code on conditions of employment. Particularly, Rule X of Book III
provides guidelines on the manner by which the powers of the Labor Secretary shall
be exercised; on what records should be kept; maintained and preserved; on payroll;
and on the exclusion of working scholars from, and inclusion of resident physicians
in the employment coverage as far as compliance with the substantive labor
provisions on working conditions, rest periods, and wages, is concerned.
In other words, Rule X is merely a guide to the enforcement of the substantive law
on labor. The Court, thus, makes the distinction and so holds that Section 14, Rule X,
Book III of the Rules is not the decisive law in a civil suit for damages instituted by
an injured person during a vehicular accident against a working student of a school
and against the school itself.
The present case does not deal with a labor dispute on conditions of employment
between an alleged employee and an alleged employer. It invokes a claim brought by
one for damages for injury caused by the patently negligent acts of a person, against
both doer-employee and his employer. Hence, the reliance on the implementing rule
on labor to disregard the primary liability of an employer under Article 2180 of the
Civil Code is misplaced. An implementing rule on labor cannot be used by an
employer as a shield to avoid liability under the substantive provisions of the Civil
Code.
There is evidence to show that there exists in the present case an extra-contractual
obligation arising from the negligence or reckless imprudence of a person "whose
acts or omissions are imputable, by a legal fiction, to other(s) who are in a position to
exercise an absolute or limited control over (him)." (Bahia v. Litonjua and Leynes,
30 Phil. 624 [1915])
Funtecha is an employee of petitioner Filamer. He need not have an official
appointment for a driver's position in order that the petitioner may be held
responsible for his grossly negligent act, it being sufficient that the act of driving at
the time of the incident was for the benefit of the petitioner. Hence, the fact that
Funtecha was not the school driver or was not acting within the scope of his
janitorial duties does not relieve the petitioner of the burden of rebutting the
presumption juris tantum that there was negligence on its part either in the selection
of a servant or employee, or in the supervision over him. The petitioner has failed to
show proof of its having exercised the required diligence of a good father of a family
over its employees Funtecha and Allan.
The Court reiterates that supervision includes the formulation of suitable rules and
regulations for the guidance of its employees and the issuance of proper instructions
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intended for the protection of the public and persons with whom the employer has SO ORDERED.
relations through his employees. (Bahia v. Litonjua and Leynes, supra, at p. 628;
Phoenix Construction, v. Intermediate Appellate Court, 148 SCRA 353 [1987])

An employer is expected to impose upon its employees the necessary discipline

called for in the performance of any act indispensable to the business and beneficial
to their employer.

In the present case, the petitioner has not shown that it has set forth such rules and
guidelines as would prohibit any one of its employees from taking control over its
vehicles if one is not the official driver or prohibiting the driver and son of the
Filamer president from authorizing another employee to drive the school vehicle.
Furthermore, the petitioner has failed to prove that it had imposed sanctions or
warned its employees against the use of its vehicles by persons other than the driver.

The petitioner, thus, has an obligation to pay damages for injury arising from the
unskilled manner by which Funtecha drove the vehicle. (Cangco v. Manila Railroad
Co., 38 Phil. 768, 772 [1918]). In the absence of evidence that the petitioner had
exercised the diligence of a good father of a family in the supervision of its
employees, the law imposes upon it the vicarious liability for acts or omissions of its
employees. (Umali v. Bacani, 69 SCRA 263 [1976]; Poblete v. Fabros, 93 SCRA
200 [1979]; Kapalaran Bus Liner v. Coronado, 176 SCRA 792 [1989]; Franco v.
Intermediate Appellate Court, 178 SCRA 331 [1989]; Pantranco North Express, Inc.
v. Baesa, 179 SCRA 384 [1989]) The liability of the employer is, under Article 2180,
primary and solidary. However, the employer shall have recourse against the
negligent employee for whatever damages are paid to the heirs of the plaintiff.

It is an admitted fact that the actual driver of the school jeep, Allan Masa, was not
made a party defendant in the civil case for damages. This is quite understandable
considering that as far as the injured pedestrian, plaintiff Potenciano Kapunan, was
concerned, it was Funtecha who was the one driving the vehicle and presumably was
one authorized by the school to drive. The plaintiff and his heirs should not now be
left to suffer without simultaneous recourse against the petitioner for the consequent
injury caused by a janitor doing a driving chore for the petitioner even for a short
while. For the purpose of recovering damages under the prevailing circumstances, it
is enough that the plaintiff and the private respondent heirs were able to establish the
existence of employer-employee relationship between Funtecha and petitioner
Filamer and the fact that Funtecha was engaged in an act not for an independent
purpose of his own but in furtherance of the business of his employer. A position of
responsibility on the part of the petitioner has thus been satisfactorily demonstrated.

WHEREFORE, the motion for reconsideration of the decision dated October 16,
1990 is hereby GRANTED. The decision of the respondent appellate court affirming
the trial court decision is REINSTATED.
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