LABOR LAW - Hernando CDD 2023

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CASE DIGESTS
Burden of Proof and Quantum of Evidence

People vs. Imperio y Antonio
1
Pre-Employment
Illegal Recruitment
People vs. Manalang 4
People vs. Liwanag 7
Employment Proper
Social Welfare Legislation
Nagaño vs. Tanjangco 9
Silva vs. Lo 11
Dy Buncio vs. Ramos 14
Heirs of De Lara, Sr. vs. Rural Bank of Jaen, Inc. 16
Philippine Transmarine Carriers, Inc. vs. San Juan 19
Singson vs. Arktis Maritime Corp. 21
Idul vs. Alster Int'l. Shipping Services, Inc. 24
Mabalot vs. Maersk-Filipinas Crewing, Inc. 26
Rodriguez vs. Philippine Transmarine Carriers, Inc. 28
Darroca, Jr. vs. Century Maritime Agencies, Inc. 31
Marlow Navigation Phils. vs. Heirs of Beato 33
Paglinawan vs. Dohle Philman Agency, Inc. 36
Ville vs. Maersk-Filipinas Crewing, Inc. 38
C.F. Sharp Crew Management vs. Jaicten 40
Destriza v. Fair Shipping Corporation 42
Post-Employment
Employer-Employee Relationship
Test to Determine Employer-Employee Relationship
Kinds of Employment
SRL International Manpower Agency vs. Yarza, Jr. 45
Ginta-Ason vs. J.T.A. Packaging Corp. 48
Jovero v. Cerio 50
Engineering & Construction Corporation of Asia vs. Palle 52
CASE DIGESTS
V People Manpower Phils., Inc. vs. Buquid 55

Cabatan vs. Southeast Asia Shipping Corp. 58
Palgan vs. Holy Name University 60
Post-Employment
Termination of Employment by Employer
University of the Cordilleras vs. Lacanaria 63
Villola vs. United Philippine Lines, Inc. 67
Lufthansa Technik Philippines, Inc. vs. Cuizon 70
Termination of Employment by Employee
Reliefs from Illegal Dismissal
San Miguel Corp. vs. Gomez 73
Colegio San Agustin-Bacolod vs. Montaño 76
JR Hauling Services vs. Solamo, et. al. 78
Gesolgon vs. CyberOne PH., Inc. 81
Omanfil International Manpower Development Corp. vs. Mesina 83
Spouses Maynes vs. Oreiro 86
Santos, Jr. vs. King Chef 89
Angono Medics Hospital, Inc. vs. Agabin 91
Lamadrid vs. Cathay Pacific Airways Limited 94
Pacific Royal Basic Foods, Inc. vs. Noche 97
Belarso vs. Quality House, Inc. 100
Systems and Plan Integrator and Development Corp. vs. Ballesteros 103
Regala vs. Manila Hotel Corp. 106
Gososo vs. Leyte Lumber Yard and Hardware, Inc. 108
Dela Torre vs. Twinstar Professional Protective Services, Inc. 111
Tacis vs. Shields Security Services, Inc. 113
Philam Homeowners Association, Inc. vs. De Luna 115
Bance vs. University of St. Anthony 117
Philippine National Bank vs. Bulatao 120
Italkarat 18, Inc. vs. Gerasmio 122
Jurisdiction and Remedies

Del Pilar vs. Batangas II Electric Cooperative, Inc. 124
CASE DIGESTS
Esico vs. Alphaland Corp. 126

Del Monte Land Transport Bus, Co. vs. Armenta 128
De Jesus vs. Inter-Orient Maritime Enterprises, Inc. 130
Miscellaneous
Garcia vs. Santos Ventura Hocorma Foundation, Inc. 132
CASE DOCTRINES
Burden of Proof and Quantum of Evidence

People v. Imperio y Antonio 135
Pre-Employment
Illegal Recruitment
People v. Manalang 135
People v. Liwanag 137
Employment Proper
Social Welfare Legislation
Nagaño v. Tanjangco 137
Silva v. Lo G.R. 138
Dy Buncio v. Ramos 138
Heirs of De Lara, Sr. v. Rural Bank of Jaen, Inc. 139
Philippine Transmarine Carriers, Inc. v. San Juan 140
Singson v. Arktis Maritime Corp. 141
Idul v. Alster Int'l. Shipping Services, Inc. 142
Mabalot v. Maersk-Filipinas Crewing, Inc. 143
Rodriguez v. Philippine Transmarine Carriers, Inc. 143
Darroca, Jr. v. Century Maritime Agencies, Inc. 145
Marlow Navigation Phils. v. Heirs of Beato 145
Paglinawan v. Dohle Philman Agency, Inc. 146
Ville v. Maersk-Filipinas Crewing, Inc. 147
C.F. Sharp Crew Management v. Jaicten 147
Destriza v. Fair Shipping Corporation 148
CASE DOCTRINES
Post-Employment
Employer-Employee Relationship
Test to Determine Employer-Employee Relationship
Kinds of Employment
SRL International Manpower Agency v. Yarza, Jr. 148
Ginta-Ason v. J.T.A. Packaging Corp. 149
Jovero v. Cerio 149
Engineering & Construction Corporation of Asia v. Palle 150
V People Manpower Phils., Inc. v. Buquid 151
Cabatan v. Southeast Asia Shipping Corp. 152
Palgan v. Holy Name University 152
Termination of Employment by Employer

University of the Cordilleras vs. Lacanaria 153
Villola v. United Philippine Lines, Inc. 154
Lufthansa Technik Philippines, Inc. v. Cuizon 155
Termination of Employment by Employee
Reliefs from Illegal Dismissal

San Miguel Corp. v. Gomez 156
Colegio San Agustin-Bacolod v. Montaño 156
JR Hauling Services v. Solamo 157
Gesolgon v. CyberOne PH., Inc. 158
Omanfil International Manpower Development Corp. v. Mesina 158
Spouses Maynes v. Oreiro 159
Santos, Jr. v. King Chef 160
Angono Medics Hospital, Inc. v. Agabin 160
Lamadrid v. Cathay Pacific Airways Limited 161
Pacific Royal Basic Foods, Inc. v. Noche 162
Belarso v. Quality House, Inc. 163
Systems and Plan Integrator and Development Corp. v. Ballesteros 164
Regala v. Manila Hotel Corp. 165
Gososo v. Leyte Lumber Yard and Hardware, Inc. 165
Dela Torre v. Twinstar Professional Protective Services, Inc. 166
Tacis v. Shields Security Services, Inc. 167
Philam Homeowners Association, Inc. v. De Luna 167
Bance v. University of St. Anthony 168
Philippine National Bank v. Bulatao 168
Italkarat 18, Inc. v. Gerasmio 169
CASE DOCTRINES

Del Pilar v. Batangas II Electric Cooperative, Inc. 170
Esico v. Alphaland Corp. 170
Del Monte Land Transport Bus, Co. v. Armenta 171
De Jesus v. Inter-Orient Maritime Enterprises, Inc. 172
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
caseS
LABOR LAW
Fundamental Principles and Concepts
BURDEN OF PROOF AND QUANTUM OF EVIDENCE
PEOPLE VS. IMPERIO Y ANTONIO
HERNANDO, J.
GR No. 232623 October 05, 2020
BURDEN OF PROOF AND QUANTUM OF EVIDENCE IN ILLEGAL RECRUITMENT CASES
DOCTRINE
In illegal recruitment cases, receipt of payment as evidence of profit is not
material. Article 13 (b) of the Labor Code states that the act of recruitment may be for
profit or not. It suffices that appellant promised or offered employment for a fee to the
complaining witnesses to warrant his conviction for illegal recruitment. More so where the
respective testimonies of the complainants clearly narrated the accused's involvement in
illegal recruitment activities.
"[To] prove Illegal Recruitment, it must be shown that the accused gave the
complainants the distinct impression that he or she had the power or ability to deploy the
complainants abroad in such a manner that they were convinced to part with their money
for that end."
FACTS
An Information for Illegal Recruitment in Large Scale under Republic Act No. (RA)
8042, otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995" was
filed against Oliver Imperio y Antonio.
Sometime between June 2011 and July 2011, Imperio informed Shane Llave,
private petitioner, that his aunt, who was based in California, United States of America,
was hiring a data encoder. Due to Imperio's representations, Llave forwarded her resume
to appellant, and paid him the amount of P7,000.00 as processing fee for her visa
application with the United States Embassy, for which no receipt was issued. Upon
Imperio’s request for other referrals, Llave recommended several other applicants and
were offered to an employment. In consideration for their employment abroad, Imperio
collected from these applicants certain amounts of money. Despite the applicants'
repeated inquiries, and the lapse of a considerable length of time, appellant failed to
secure overseas employment for them as promised. These circumstances prompted them
to file their respective complaints against appellant before the NBI. Later on, it was
revealed that Imperio has no license or authority to recruit applicants for overseas
employment as certified by the Philippine Overseas Employment Agency (POEA). Imperio
was arrested via an entrapment operation conducted by the NBI.
In his defense, Imperio vehemently denied the allegations against him. Imperio
alleged that he met Llave on June 3, 2011 when the latter applied for work at his office.
1
It is through their continued friendship that Llave was able to secure a loan from him.
Despite repeated demands, Llave failed to pay her obligation to him. Imperio further
claimed that he came to know the other private complainants through Llave, and, on one
occasion, had an altercation with them at the latter's house. While Imperio later admitted
that he received various amounts from private complainants, he claimed that all these
were made as payment for Llave's outstanding obligation to him.
The RTC found Imperio guilty beyond reasonable doubt of Illegal Recruitment in
Large Scale. Aggrieved, Imperio appealed the Judgment to the CA. On February 10, 2017,
the CA rendered its assailed Decision affirming with modifications the Judgment of the
RTC.
ISSUE
Is the absence of the receipt to prove payment absolve Imperio from the crime of
Illegal Recruitment?
HELD
No, the absence of the receipt to prove Imperio’s criminal actions does not
warrant acquittal. The fact that no receipt was issued by Imperio is not fatal to the
prosecution's cause, more so in this case where the respective testimonies of private
complainants clearly narrated Imperio’s involvement in illegal recruitment activities. The
case of People v. Domingo is instructive, viz.:
That no receipt or document in which appellant acknowledged receipt of money

for the promised jobs was adduced in evidence does not free him of liability. For even if
at the time, appellant was promising employment no cash was given to him, he is still
considered as having been engaged in recruitment activities, since Article 13 (b) of the
Labor Code states that the act of recruitment may be for profit or not. It suffices that
appellant promised or offered employment for a fee to the complaining witnesses to
warrant his conviction for illegal recruitment.
Moreover, in the case at bar, all the elements of Illegal Recruitment in Large Scale
are present in the instant case. First, the appellant is a non-licensee or non-holder of
authority. Second, three (3) private complainants, namely, Llave, Concrenio, and Sta.
Maria, all positively identified Imperio as the person who promised them overseas
employment in Canada or the USA in various capacities, which gave them the distinct
impression that appellant had the ability to facilitate their applications and, eventually,
deploy them for employment abroad.
Imperio attacks the credibility and veracity of their accounts for being faulty and
inconsistent. The Court finds that the inconsistencies cited by Imperio are immaterial to
adversely affect their testimonies. To the Court, these are minor details and collateral
matters which do not affect the weight and substance of their declarations. Nor do they
touch on the essential elements of the crime charged. "It is an elementary rule in this
jurisdiction that inconsistencies in the testimonies of prosecution witnesses with respect
to minor details and collateral matters do not affect the substance of their declaration
2
nor the veracity or weight of their testimony." Verily, what is important is that private
complainants have positively identified Imperio as the one who made misrepresentations
of his capacity to secure and facilitate for them overseas employment, and induced them
to part with their money upon the false promise of employment abroad.
3
Pre-Employment
ILLEGAL RECRUITMENT
PEOPLE VS. MANALANG
HERNANDO, J.
GR No. 198015 January 20, 2021
ILLEGAL RECRUITMENT VS. ESTAFA
DOCTRINE
Illegal recruitment is deemed committed by a syndicate if carried out by a group
of three (3) or more persons conspiring or confederating with one another. It is deemed
committed on a large scale if committed against three (3) or more persons individually or
as a group.
Under RA 8042, a non-licensee or non-holder of authority commits illegal

recruitment for overseas employment in two ways: (1) by any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring, or procuring workers, and includes referring,
contract services, promising or advertising for employment abroad, whether for profit or
not; and (2) by undertaking any of the acts enumerated under Section 6 of RA 8042. On
the other hand, a licensee or holder of authority is also liable for illegal recruitment for
overseas employment when he or she undertakes any of the thirteen acts or practices [(a)
to (m)] listed under Section 6 of RA 8042. To constitute illegal recruitment in large scale,
the offense of illegal recruitment must be committed against three or more persons,
individually or as a group.
In estafa, damage is essential, but not in the crime of illegal recruitment. As to

the latter, it is the lack of the necessary license or authority, but not the fact of payment
that renders the recruitment activity as unlawful.
FACTS
Accused-appellant Avelina Manalang a.k.a. Tess Robles, a.k.a. Alvina Manalang was
charged with Illegal Recruitment in Large Scale in violation of Section 6(1) and (m) of
Republic Act No. 8042 (RA 8042), otherwise known as the Migrant Workers and Overseas
Filipino Act of 1995, and Estafa under Article 315(2) of the Revised Penal Code (RPC).
On separate occasions, Tura and Marañon was introduced to Manalang who deploys
workers to Austria. During their meetings, Manalang promised to deploy Tura and Marañon
to Austria as chambermaid, provided that they will give Manalang a placement fee. Both
gave a total amount of P80,000.00 as placement fee and for other fees. They were also
assured by Manalang that they will be deployed by January 2021. Both waited for their
deployment but it did not materialized.
Tura then demanded the reimbursement but to no avail, therefore he filed a

complaint before CIDG which arrested Manalang in an entrapment operation. Marañon, on
4
the other hand went to POEA to verify whether Manalang is a licensed recruiter and found
out that he is not authorized to recruit.
Manalang averred that: (a) she is the owner of Honte Travel and Tours, which
processes applications for passports as well as visas; (b) she also owns Mirilyn Training
School, which offers training for hotel and restaurant services, such as food service,
housekeeping, and bartending; (c) both offices are located at Room 221 of the Trade
Center Building, and both cater to walk-in trainees as well as applicants referred by
agents; (d) both offices have permits from the Department of Trade and Industry and from
the Office of the Mayor; (e) as of the time of her testimony, their registration with the
Department of Labor and Employment (DOLE) and the Technical Education and Skills
Development Authority (TESDA) was still being processed; (f) private complainants
underwent training in her office; (g) however, she did not process their application forms
or offer them employment abroad; and (h) she agreed to reimburse half of the placement
fees supposedly paid by private complainants in order to appease them and to avoid
trouble.
The Regional Trial Court found Manalang guilty beyond reasonable doubt of Illegal
Recruitment in Large Scale, and three (3) counts of Estafa under Art. 315, paragraph 2(a)
of the RPC. Aggrieved, Manalang filed an appeal with the CA. The appellate court held
that the trial court did not commit any reversible error in convicting Manalang of Illegal
Recruitment in Large Scale under RA 8042 and three (3) counts of Estafa under Art.315,
par.2 (a) of the RPC.
ISSUE
Is Manalang liable for the crime of Illegal Recruitment in Large Scale under RA
8042 and estafa under Art. 315 of the RPC.
HELD
Yes, the Court finds that the elements for the crime of Illegal Recruitment in Large
Scale were sufficiently established in the instant case.As provided under the Labor Code,
the essential elements of Illegal Recruitment in Large-Scale are: (1) that the accused
engaged in acts of recruitment and placement of workers as defined under Article 13 (b)
of the Labor Code, or in any prohibited activities listed under Articles 34 and 38 of the
Labor Code; (2) that he/she had not complied with the guidelines issued by the Secretary
of DOLE with respect to the requirement to secure a license or authority to recruit and
deploy workers; and (3) that she committed the unlawful acts against three or more
persons.
While Article 38 of the Labor Code limits illegal recruitment to recruitment
activities undertaken by non-licensees or non-holders of authority, Part II of RA 8042
defines and penalizes illegal recruitment for employment abroad, regardless of whether it
was undertaken by a non-licensee or non-holder of authority or by a licensee or holder of
authority
In the case at bar, Firstly, there is no doubt that the Manalang engaged in acts of
recruitment and placement of workers. She promised to deploy the private complaints for
5
work abroad upon payment of their placement fee. Secondly, it was duly established that
Manalang was neither licensed nor authorized by the POEA to recruit workers for overseas
employment, as evidenced by the POEA Certification dated January 23, 2002. Thirdly, the
illegal recruitment was committed in large scale because the accused-appellant
defrauded at least three persons, namely, Tura, Marañon and Cawas, who are the private
complainants in the instant case.
Moreover, Manalang is also guilty of the crime of Estafa under Article 315 of the
Revised Penal Code. The elements of estafa by means of deceit, whether committed by
false pretenses or concealment, are the following: (a) there must be a false pretense,
fraudulent act or fraudulent means; (b) such false pretense, fraudulent act or fraudulent
means must be made or executed prior to or simultaneously with the commission of the
fraud; (c) the offended party must have relied on the false pretense, fraudulent act or
fraudulent means, that is, he was induced to part with his money or property because of
the false pretense, fraudulent act or fraudulent means; and (d) as a result thereof, the
offended party suffered damage.
Jurisprudence is settled that a person, for the same acts, may be convicted
separately for Illegal Recruitment under RA 8042 (or the Labor Code), and Estafa under
Article 315(2)(a) of the RPC.
In the instant case, the elements of deceit and damage are present. The Court
notes that the accused-appellant, without any license or authority to do so, promised
private complainants overseas employment, then required them to undergo training and
collected fees or payments from them, while continually assuring them that they would
be deployed abroad, but failed to do so. Persuaded by these assurances given by
Manalang, the private complainants paid their placement fees, albeit partially. Thus, her
representation induced the victims to part with their money, resulting in damage.
6
PEOPLE VS. LIWANAG
HERNANDO, J.
GR No. 232245 March 2, 2022
DOCTRINE
It is settled that a person, for the same acts, may be convicted separately of
Illegal Recruitment under RA 8042 or the Labor Code, and Estafa under Article 315 (2) (a)
of the RPC. Case law holds that the same pieces of evidence that establish liability for
Illegal Recruitment in Large Scale confirm culpability for Estafa.
FACTS
Mildred Coching Liwanag was charged with several Informations for Illegal
Recruitment in Large-Scale and Estafa.
The prosecution presented private complainants Carol Pagulayan Sepina, Allan P.

Sepina, and Christopher Claudel as witnesses. Dolores Pagulayan, Carol's mother and
Allan's mother-in-law, was likewise presented as a witness. The evidence of the
prosecution showed that Mildred met private complainants, spouses Allan and Carol and
spouses Christopher and Jennifer Claudel, and promised them employment abroad.
Mildred accompanied Carol and Jennifer, while their respective spouses were at work, to
the Provider Travel Corporation and introduced them to a certain Agnes. Mildred told
them that Agnes would take charge in the processing of all their application papers.
Mildred required them to pay for their visas and plane tickets. The amount, which was
pooled by private complainants, was handed to Mildred by Dolores, Carol's mother, while
Carol and Jennifer were present. Mildred likewise did not issue a receipt for said amount.
On the scheduled date for their departure, Mildred went to Carol and Allan's residence at
Muntinlupa City and informed them that their flight would be canceled because Mildred's
sister would come home soon. It turned out that there were no plane tickets, visas,
passports or job orders from the prospective employer in Japan for Allan and Carol.
Thereafter, the instant cases were filed in court.
For her part, Mildred denied the charges against her. She testified that she was
introduced to Allan and Carol through her father, a barangay police. While she confirmed
that her sister lived in Japan, she stated that her sister was a housewife and not a
manager of a noodle factory. She denied that she promised to send Allan and Carol abroad
for work or that she received any money or documents from them for such purpose. She
was unaware of any personal grudge against her that would compel the complainants to
file these complaints against her.
The RTC rendered its judgment convicting Mildred of Illegal Recruitment in Large
Scale and four counts of Estafa. The CA denied the appeal and affirmed the RTC's
judgment.
7
ISSUE
May accused-appellant, for the same acts, be convicted separately of Illegal
Recruitment under RA 8042 or the Labor Code, and Estafa under Article 315 (2) (a) of the
RPC.
HELD
Yes, accused-appellant, for the same acts, may be convicted separately of Illegal
Recruitment under RA 8042 or the Labor Code, and Estafa under Article 315 (2) (a) of the
RPC. The essential elements for Illegal Recruitment in Large Scale are that: (1) the person
charged undertook any recruitment activity as defined under Section 6 of RA 8042; (2)
accused did not have the license or the authority to lawfully engage in the recruitment of
workers; and (3) accused committed the same against three or more persons individually
or as a group. After a careful review of the records in this case, the Court finds that all
three elements have been established beyond reasonable doubt by the prosecution.
The fact that no receipt was issued by Mildred is not fatal to the prosecution's
cause, more so if the respective testimonies of private complainants clearly Mildred’s
involvement in illegal recruitment activities. The absence of receipts to evidence
payment does not automatically warrant acquittal of the accused since a person charged
with the offense of Illegal Recruitment may be convicted on the strength of the
testimonies of the complainants, if found to be credible and convincing. Moreover, the
testimony of the prosecution witnesses on the matter is bolstered by the barangay blotter,
wherein Mildred admitted having received certain amounts from private complainants and
promised to repay the said amounts.
*The law does not require that at least three victims testify at the trial to convict
an accused for Illegal Recruitment in Large Scale, for so long as there is sufficient
evidence proving that the offense was committed against three or more persons. Here,
the evidence presented by the prosecution, considered as a whole, meets this threshold.
The testimony of the prosecution witnesses was positive and categorical, and
corroborated each other on material points. Without any evidence to show that the
witnesses were propelled by any ill motive to testify falsely against her, their testimonies
deserve full faith and credit.
All the aforesaid elements are present in this case. The prosecution sufficiently
established that Mildred defrauded the four private complainants by making them believe
that she had the capacity to deploy them to Japan as factory workers, even if she did not
have the authority or license for the purpose. Because of her promises to deploy them to
Japan, the victims willingly parted with their money as processing and placement fees to
her. Consequently, all the victims suffered damages in the amount of P40,500.00 each as
the promised employment abroad never materialized, and the said money they parted
with were never recovered.
8
Employment Proper
SOCIAL WELFARE LEGISLATION
NAGAÑO VS. TANJANGCO
HERNANDO, J.
GR No. 204218 May 12, 2021
SOCIAL LEGISLATION; COVERAGE FOR THE APPLICATION FOR RETENTION
DOCTRINE
The Presidential Decree No. 27 decreed the emancipation of all tenant farmers of
rice or corn lands under the land transfer program of the government. A covered
landowner was allowed to retain an area of not more than seven (7) hectares if his/her
tenanted rice or corn lands do not exceed 24 hectares.
FACTS
The subject property is a 238.7949-hectare piece of land situated in Mambangan,
San Leonardo, Nueva Ecija. The subject property was then covered by Transfer Certificate
of Title (TCT) No. 1221012, was placed under the land transfer program of the
government pursuant to PD 27. At that time, the subject property was registered under
the names of the Spouses Jose Tanjangco and Anita Suntay with respect to 144 hectares,
and under the names of respondents and their two other siblings, Federico S. Tanjangco
and Antonio S. Tanjangco, who are not parties to this case, with respect to 95.5845
hectares. Pursuant to Presidential Decree No. 27, emancipation patents were issued in
favor of the tenant-beneficiaries.
The 144-hectares portion allocated to the Spouses Tanjangco was transferred to

respondents and their siblings, under TCT No. 177766. On October 5, 1999, respondents
filed an application for retention of five (5) hectares each of them on the subject
property pursuant to Republic Act No. 6657, or otherwise known as the Comprehensive
Agrarian Reform Law of 1988, before the DAR Regional Office.
Petitioner alleged that respondents were disqualified to retain, considering that

they each already owned more than 24 hectares of land on the subject property, a
disqualifying condition under PD 27 and its implementing rule DAR Administrative Order
No. 4, series of 1991 (DAO 04-91), otherwise known as the Supplemental Guidelines
Governing the Exercise of Retention Rights by Landowners under PD 27. During the
pendency of the application for retention, respondents and their siblings executed a Deed
of Partition dated July 4, 2000 which allocated 20 hectares to each respondent, 138.7949
hectares to Federico, and 20 hectares to Antonio, Thus, on July 4, 2000, each respondent
owned less than 24 hectares.
The DAR Regional Director held that respondents were not entitled to retention
because they each owned more than 24 hectares of tenanted rice or corn lands, in
violation of DAO 04-91. Respondents appealed to the DAR Secretary and affirmed the
9
decision of the DAR Regional Director. DAR Secretary ruled that respondents were entitled
to retention and noted that the landowners whose land were covered by PD 27, such as
respondents, were allowed to retain 5 hectares of compact and contiguous land under RA
6657.
Petitioners filed a motion for reconsideration but was denied. Thus, the
petitioners appealed to the Office of the President who reinstated the Orders of the DAR
Regional Director and the DAR Secretary. The Court of Appeals reinstated the Resolution
of the DAR Secretary, which respectively granted and affirmed the grant of respondents’
application for retention. Petitioner moved for reconsideration, however it was denied.
Hence, this appeal.
ISSUE
Were the respondents entitled to retain 5 hectares each of the subject property as
provided in the PD No. 27 or the Tenant Emancipation Decree.
HELD
No, the respondents are not entitled to the retention of 5 hectares. Under the PD
27, the emancipation of all tenant farmers of rice or corn lands under the land transfer
program of the government. A covered landowner was allowed to retain an area of not
more than seven (7) hectares if his/her tenanted rice or corn lands do not exceed 24
hectares.
RA No. 6657 issued on June 10, 1988, instituted a comprehensive agrarian reform
program and modified the retention limits provided under PD 12 in that a landowner was
allowed to retain five hectares and an additional three hectares for each child of the
landowner, and provided that the area to be retained is compact and contiguous.
Respondents' application for retention pertained to areas in the entire 238.7949

hectares subject property, not just in the 95.5845-hectare portion originally allocated to
them. By applying for retention of areas in the entire subject property, respondents
exercised their rights as owners thereof. And being co- owners of the 238.7949 hectares,
each of them owned more than 24 hectares. Clearly, they are covered by the
disqualification in DAO 04-91.
10
SILVA VS. LO
HERNANDO, J.
GR No. 206667 June 23, 2021
SOCIAL LEGISLATION; COMPREHENSIVE AGRARIAN REFORM LAW; TENANTS AS PARTIES IN A
PARTITION CASE
DOCTRINE
The Rule 69 of the Rules of Court have laid down two phases of an action for
partition: first, the trial court, after determining that a co-ownership in fact exists and
that partition is proper, issues an order for partition; and, second, the trial court
promulgates a decision confirming the sketch and subdivision of the properties submitted
by the parties (if the parties reach an agreement) or by the appointed commissioners (if
the parties fail to agree), as the case may be.
FACTS
Carlos Sandico, Jr. died intestate leaving behind an estate to his compulsory heirs.
The heirs of Carlos Jr. executed an Extrajudicial Settlement of Estate which

provided that all properties of the decedent shall be owned in common, pro indiviso, by
his heirs. In 1988, Carlos, Jr.'s heirs executed a Memorandum of Agreement for the
physical division of the estate. However, both agreements were never implemented and
the heirs remained pro indiviso co-owners of the estate's properties. The Registry of Deeds
of Pampanga issued Transfer Certificate of Title (TCT) No. 377745-R covering the subject
property under the names of Concepcion and Carlos III subject to the encumbrances of
the decedent's estate which listed the names of the other compulsory heirs.
For three years, under the supervision of the RTC, the heirs negotiated the terms
of the estate's partition to be embodied in a compromise agreement. The RTC issued an
Order of Partition declaring and ordering the partition of the intestate estate of the late
Carlos Sandico, Jr. among his surviving spouse and children in accordance with and
pursuant to the terms and conditions contained in the final Compromise Agreement
already signed by the plaintiff and the plaintiff-in-intervention, which is hereby
incorporated to and made part of this Order disposing of the present case by way of
reference. Despite the RTC's Order of Partition, various properties of the estate remained
undivided and were not distributed among the heirs.
On September 10, 2003, Atty. Tuason, counsel for the defendants, filed a
Manifestation opposing the appointment of commissioners on the ground that the
agricultural land tenants have already agreed to the subdivision of the agricultural lands.
Apparently, some of the estate's agricultural lands, including the herein subject property,
were covered by Republic Act No. 6657, The Comprehensive Agrarian Reform Law (CARL),
for distribution to tenant-farmers. Thus, in compliance with the law, the heirs,
11
represented by Concepcion, executed a Kasunduan dated May 19, 1999 (1999 Kasunduan)
with the tenants. The 1999 Kasunduan, a voluntary land transfer arrangement allowed by
the CARL, provided for a 50-50 sharing of the subject property,
Concepcion,as the representative , executed a second agreement with the tenants

of the subject property designated as "Kasunduan sa Pagwawakas/Pagtatapos ng Relasyon
bilang May-ari ng Lupa at mga Ortilano/Kasama ng Lupa" (2006 Kasunduan). The 2006
Kasunduan, similar to the 1999 Kasunduan, likewise covered the partition of the subject
property and the transfer of ownership of half thereof to the eight tenants while the
other half remained with the heirs of Carlos, Jr.
The Court of Appeals invalidated the 2006 Kasunduan because it lacked the
signature of all the heirs. The appellate court ruled that the 2006 Kasunduan did not
conform with the procedure laid down in Rule 69 of the Rules of Court on Partition. It
concluded that a void agreement could not have validly partitioned the subject property
nor could it have validly transferred subsequent title over half of the land to the tenants.
ISSUE
1. Was the RTC’s April 13, 2007 order already attained finality
2. Was the 2006 Kasunduan partitioning the subject property void because it was
not signed by all the heirs of the decedent
HELD
1. Yes. Under Section 2, Rule 69 of the Rules of Court on Partition provides that, if
after the trial the court finds that the plaintiff has the right thereto, it shall order the
partition of the real estate among all the parties in interest. Thereupon the parties may,
if they are able to agree, make the partition among themselves by proper instruments of
conveyance, and the court shall confirm the partition so agreed upon by all the parties,
and such partition, together with the order of the court confirming the same, shall be
recorded in the registry of deeds of the place in which the property is situated. A final
order decreeing partition and accounting may be appealed by any party aggrieved
thereby.
The tenants are not strangers or third parties to the subject property. Prior to
being transferees of half of the subject property, they were the agricultural tenants
thereof. Also the subject property is private agricultural compulsorily covered for
distribution to qualified beneficiaries such as the tenants under the CARL. Hence, the
heirs entered a voluntary transfer arrangement, offering to sell half of the subject
property pursuant to the CARL.
By operation of law, the tenancy relationship between the tenants on one hand,
and the co-owners of the subject property, the heirs of the decedent, on the other hand,
subsisted even after the death of one of the landholders. Under the CARL, the tenants are
deemed qualified beneficiaries to ownership of a portion of their tilled land. Ultimately,
the tenants cannot be cursorily excluded from a court determination of the validity of the
partition, and consequent change in ownership, of the subject property.
12
2. No. Despite the lack of signatures of specifically three (3) heirs of the
decedent, Enrica, Teodoro and respondent Conchita, the 2006 Kasunduan is a valid
partition of the subject property which was correctly confirmed by the RTC in its April 13,
2007 Order. Even without going into the finality of the April 13, 2007 Order, the
antecedents herein which we have painstakingly outlined will bear out that all the heirs
have assented to the partition of the subject property.
The transfer of half of the subject property was under the aegis of the DAR
pursuant to the law which the heirs cannot ignore or circumvent by their claim that the
2006 Kasunduan was not validly executed. Given the compulsory requirement of the law,
there is no validity to respondent's assertion which was sustained by the CA, that property
of the decedent was distributed to non-heirs. Plainly, the partition of the subject
property, and the consequent transfer and titling of half thereof to qualified
beneficiaries, is valid, just and binding on all the heirs of the decedent, including
Conchita. Clearly in this case, the partition and alienation of half of the subject property,
through the 2006 Kasunduan, is not completely void and cannot be annulled as to the
share of Concepcion and the other heirs, including Enrica and Teodoro.
13
DY BUNCIO VS. RAMOS
HERNANDO, J.
GR No. 206120 March 23, 2022
SOCIAL LEGISLATION; JURISDICTION OF THE DARAB; EXISTENCE OF TENANCY RELATIONSHIP
DOCTRINE
Under Section 1 (1.1) of Rule II of the DARAB 2003, the Adjudicator shall have
primary and exclusive original jurisdiction to determine and adjudicate the rights and
obligations of persons, whether natural or juridical, engaged in the management,
cultivation, and use of all agricultural lands covered by Republic Act (RA) No. 6657,
otherwise known as the Comprehensive Agrarian Reform Law (CARL), and other related
agrarian laws.
As a rule, the existence of a tenancy relationship cannot be presumed and

allegations that one is a tenant do not automatically give rise to security of tenure. Thus,
in order for tenancy agreement to arise, it is essential to establish all its indispensable
elements, viz.: (1) the parties are the landowner and the tenant; (2) the subject matter is
agricultural land; (3) there is consent between the parties to the relationship; the
purpose of the relationship is to bring about agricultural production; (4) there is personal
cultivation on the part of the tenant or agricultural lessee; and (5) the harvest is shared
between the landowner and the tenant or agricultural lessee.
FACTS
Petitioner claiming to be a registered co-owner of a parcel of land with a Transfer
of Certificate of Title, located at San Josef Sur, Cabanatuan City, alleged that respondents
are unlawful and unauthorized possessors of its land and should vacate the same.
On the other hand, respondents asserted that the RTC had no jurisdiction over the
subject matter of the case because there existed a leasehold agreement between the late
Luis de Guzman and Erlina Santos de Guzman, who are the parents of the registered
owners of the subject property, with Leontina and her late husband, Hilario Ramos. The
RTC held that based on the ocular inspection and proceedings conducted by the court, it
found that the entire area of 3.7302 hectares is devoted to palay production and
traversed by a cemented City Road of Cabanatuan City. Thus, the trial court referred the
case to the Department of Agrarian Reform Adjudication Board (DARAB) since there was
an allegation of landowner-tenant relationship between the parties.
Aggrieved with the RTC's ruling, Buncio filed a Petition for Certiorari with the CA
assailing the RTC's October 28, 2010 Resolution and its June 6, 2011 Order denying the
Motion for Reconsideration thereof.
In the meantime, the case was set for hearing on August 4, 2011 before the
Provincial Adjudicator of DARAB, Region III. Buncio, through her counsel, entered a special
14
appearance and manifested that she was not submitting herself to the jurisdiction of the
DARAB in view of her position that jurisdiction is with the trial court per the RTC's January
30, 2008 Order. The CA dismissed the petition. Buncio moved for reconsideration but it
was denied by the CA. Hence, Buncio filed the instant Petition for Review on Certiorari.
ISSUE
1. Does the Department of Agrarian Reform Adjudication Board (DARAB) have
jurisdiction to adjudicate agrarian disputes.
2. Is there a tenancy relationship between the parties.
HELD
1. Yes. Under Section 1 (1.1) of Rule II of the DARAB 2003, the Adjudicator shall
have primary and exclusive original jurisdiction to determine and adjudicate the rights
and obligations of persons, whether natural or juridical, engaged in the management,
cultivation, and use of all agricultural lands covered by Republic Act (RA) No. 6657,
otherwise known as the Comprehensive Agrarian Reform Law (CARL), and other related
agrarian laws. For DARAB to have jurisdiction over the case, there must be a tenancy
relationship between the parties.
2. Yes. In Velasquez v. Spouses Cruz, the court defined tenancy relationship as "a
juridical tie which arises between a landowner and a tenant once they agree, expressly or
impliedly, to undertake jointly the cultivation of a land belonging to the landowner, as a
result of which relationship the tenant acquires the right to continue working on and
cultivating the land."

All the foregoing requisites are necessary to create a tenancy relationship, and the
absence of one or more requisites will not make the alleged tenant a de facto tenant. In
Macalanda, Jr. v. Acosta, the Court emphasized that, "crucial for the creation of tenancy
relations would be the existence of two of the essential elements, namely, consent and
sharing and/or payment of lease rentals.
In the instant case, respondents substantially alleged that there existed a tenancy
relationship among the parties, in particular among the parents of Buncio and Hilario in
view of their leasehold agreement. Furthermore, respondents' claim that pursuant to said
agreement, she and her husband, Hilario, have been paying the agreed rentals of the
landholdings, to the lessors or Buncio's parents. These allegations suffice for the referral
of the dispute to the DAR. As stated by law, mere allegation of an agrarian dispute is
enough.
15
HEIRS OFDE LARA, SR. VS. RURAL BANK OF JAEN, INC.
HERNANDO, J.
G.R. No. 212012 March 28, 2022
SOCIAL LEGISLATION; JURISDICTION OF DARAB
DOCTRINE
For the DARAB to acquire jurisdiction, the following indispensable elements should
therefore first be established: (1) that the parties are the landowner and the tenant or
agricultural lessee; (2) that the subject matter of the relationship is an agricultural land;
(3) that there is consent between the parties to the relationship; (4) that the purpose of
the relationship is to bring about agricultural production; (5) that there is personal
cultivation on the part of the tenant or agricultural lessee; and (6) that the harvest is
shared between the landowner and the tenant or agricultural lessee.
FACTS
Jose E. De Lara, a farmer beneficiary under PD 27, was awarded a parcel of land in
Dampulan now Vicente, Jaen, Nueva Ecija. On November 20, 1998 under the DAR
(Department of Agriculture Reform) Emancipation Patent was issued in favor of him.
Subsequently, Jose obtained a loan from respondent Rural Bank of Jaen

(respondent bank) over the subject land. Unfortunately he failed to pay his obligation;
hence the mortgage was foreclosed. A public auction was held wherein respondent bank
was declared the highest bidder. The RTC of Gapan, Nueva Ecija issued a Certificate of
Sale to the respondent bank. Respondent registered the sale with the Registry of Deeds. A
year passed but neither Jose nor his heirs redeemed the subject land. Thus Respondent
bank executed an Affidavit of Consolidation of Ownership over the said land.
The bank filed a verified petition cancelling the subject land title before the
Provincial Agrarian Reform Adjudicator (PARAD), claiming that PARAD did not acquire
jurisdiction over them. Petitioners heirs however maintained their position claiming that
the purported real estate mortgage executed by Jose was void ab initio as it was executed
within 10-year prohibitory period under Sec. 27 of RA 6657, otherwise known as the
Comprehensive Agrarian Reform Program (CARP), and further petitioners claim that the
mortgage should be void because it was executed without the consent of Jose’s wife,
Marcela Mariano (Marcela).
PARAD issued a decision granting the cancellation of the subject land title, on the
grounds that Jose indeed failed to pay his loan and that the extrajudicial foreclosure of
mortgage was in accord with the Act No. 3135, as amended and such title ought to be
cancelled and issued in the name of the respondent bank. Giving no credence to
petitioners claim, aggrieved petitioners appealed to Department of Agrarian Reform
Adjudication Board (DARAB) maintaining that EP over subject land should not be
cancelled, consequently resulted in reversal of PARAD’s decision as granted for prohibition
16
under agrarian laws emphasizing that transfers of awarded agricultural land should be
through only the following means; 1. Through hereditary succession, 2. To the
Government, 3. To the Land Bank of the Philippines, or 4. To other qualified
farmer-beneficiaries.
DARAB, on the other hand, declared while Sec 73-A R.A. 6657 permits financial
banking institutions to sell or transfer mortgaged land which has been foreclosed, the
land contemplated in the said provisions does not include those under EP or CLOA
(Certificate of Land Ownership Award). Furthermore, DARAB held that Jose and Marcela’s
certificate of title over the subject land has already become indefeasible and
incontrovertible since the 1 year prescribed period upon the issuance thereof had already
lapsed. The CA on the other hand reversed the ruling of DARAB and ruled in favor of
PARAB hence this petition.
ISSUE
Can the subject land covered by EP be foreclosed as stated for in the ruling of
PARAD in favor of the respondent bank, and that DARAB hold no jurisdiction over the case.
HELD
Yes, the subject land covered by EP may be foreclosed as stated for in the ruling
of PARAD in favor of the respondent bank. Moreover, the court finds merit in the petition
stating that DARAB has no jurisdiction over the case at bench because there is no agrarian
dispute between the parties. This is enunciated in the “Rule II of the 2003 DARAB Rules of
Procedure provides that the Adjudicator has the primary and exclusive jurisdiction over
cases involving correction, partition, cancellation, secondary and subsequent issuances of
CLOAs and EPs which are registered with the Land Registration Authority. The DARAB, on
the other hand, has exclusive appellate jurisdiction to review, reverse, modify, alter, or
affirm resolutions, orders, and decisions of its Adjudicators.” There should be a tenancy
relationship between the parties for DARAB to acquire jurisdiction which is not present on
the instant case.
Tenancy relationship between the parties must exist for the DARAB to acquire
jurisdiction. The following indispensable elements should therefore first be established:
(1) that the parties are the landowner and the tenant or agricultural lessee; (2) that the
subject matter of the relationship is an agricultural land; (3) that there is consent
between the parties to the relationship; (4) that the purpose of the relationship is to
bring about agricultural production; (5) that there is personal cultivation on the part of
the tenant or agricultural lessee; and (6) that the harvest is shared between the
landowner and the tenant or agricultural lessee. These elements have not been satisfied
in the present case.
There was no tenancy relationship between petitioner and respondent bank over
the subject land. Neither did they have any leasehold or agrarian relations when the
respondent bank filed its petition with the DARAB. In fact, respondent bank did not allege
in its petition that such a relationship exists between them. What is crystal clear in the
instant case is that respondent bank's petition for cancellation of certificate of title
17
stemmed from the subject land's foreclosure. There was therefore no agrarian dispute
notwithstanding the fact that the land involved is an agricultural land. Thus, respondent's
petition should have been dismissed by the DARAB for lack of jurisdiction.
The Respondents bank recourse should have been with the Register of Deeds and
not before the DARAB. The court stated that DAR was not even the proper forum for the
resolution of the matter at hand. Respondent bank, being the purchaser in the foreclosure
sale of the subject land and after Jose's failure to redeem the same, should have at least
first brought its cause before the appropriate Register of Deeds, not before the DAR. The
CA thus erred in reversing the Decision of the DARAB since the petition to cancel TCT is
beyond the jurisdiction of the DAR.
Agreements that violate a law and public policy are inexistent and void from the
beginning. These contracts cannot be ratified. Neither can the right to set up the defense
of illegality be waived. Therefore, the extrajudicial foreclosure of such real estate
mortgage over the land is void ab initio.
18
PHILIPPINE TRANSMARINE CARRIERS, INC. VS. SAN JUAN
HERNANDO, J.
GR No. 207511 October 5, 2020
DISABILITY BENEFITS
DOCTRINE
It is settled that before a seafarer may claim permanent total disability benefits
from his employer, it must be first established that the latter's company-designated
physician failed to issue a declaration as to his fitness to engage in sea-duty or disability
grading within the 120-day period or 240-day extension provided for by law.
FACTS
Salinas is engaged in the business of providing marine management services. It
hired San Juan on several occasions as Chief Cook during the period of Feb. 24, 1992 - May
15, 2008. He was rehired on behalf of PTCI’s principal, General Maritime Management
LLC, to work as a Chief Cook aboard the vessel MV Genmar George T for a period of 8
months. Prior to his embarkation, San Juan underwent a routine Pre-employment Medical
Examination PEME where he declared that he suffered from hypertension treated with
medication. San Juan was eventually given cardiac clearance and was certified as “fit to
work” by PTCI’s company-designated physicians.
San Juan departed from the Philippines and commenced his work on board a
vessel. San Juan claimed that he performed hard manual labor and engaged in strenuous
physical activities for 12 hours a day. He eventually suffered fatigue, shortness of breath,
and severe headaches. San Juan further alleged that he collapsed several times during the
voyage due to lack of medications and medical attention.
Due to his condition, San Juan was brought to a medical facility in India for a
medical examination. His attending physician issued a Medical Certificate indicating that
he presented high blood pressure which is not controlled by the medication he is taking.
San Juan signed off from the vessel and was medically repatriated to the Philippines on
Feb. 1, 2010. He was immediately referred to the company-designated physician MMC
(Metropolitan Medical Center) for medical examination and further treatment. After
treatment and undergoing several tests with neurologist and cardiologist, he was
diagnosed with Stage 2 Hypertension controlled with medications. He was no longer
rehired by PTCI. He claimed that he applied for employment with other manning
agencies, but was unsuccessful. San Juan filed this instant complaint against PTCI,
General Management LLC, and Salinas seeking payment of his permanent disability
benefits and sickness allowance. Meanwhile, San Juan sought another medical opinion
with PHC which certified him to be medically unfit to work in any capacity as a seaman.
The Labor Arbiter promulgated a decision awarding San Juan sickness wages
benefit and attorneys fees, claiming that San Juan’s engagement as Chief Cook since 1992
proved that he acquired his illness in the course of his employment with PTCI, and his
19
medical condition was aggravated by his day-to-day duties on board the vessel. The NLRC,
upon appeal, reversed the decision of LA favoring the PTCI, claiming that the present
condition of San Juan considering the intervening time and possible external factors is not
work related. The CA reversed the NLRC decision and reinstated the LA’s decision. In
granting permanent total disability benefits to San Juan, the CA found that San Juan was
able to establish a causal connection between the conditions of his work and his illness.
The appellate court found that San Juan's illness was acquired in the course of his
employment with PTCI.
ISSUE
Did the CA commit grave abuse of discretion in affirming the decision of the LA
awarding San Juan permanent total disability benefits.
HELD
Yes, the CA committed grave abuse of discretion in affirming the decision of the
LA awarding San Juan permanent total disability benefits. The Supreme Court ruled in
favor of the ruling of NLRC stating that San Juan is not entitled to his claim for permanent
and total disability benefits.
Since San Juan's employment contract was executed on August 26, 2009, his
entitlement to disability benefits is governed by the Amended Standard Terms and
Conditions Governing the Overseas Employment of Filipino Seafarers On-Board
Ocean-Going Ships (2000 POEA-SEC), and pertinent labor laws, which are deemed
incorporated into his employment contract with PTCI.
Pursuant of the Labor Code permanent total disability has the following prescribed
rules; Art. 192 Permanent Disability- c. the following disabilities shall be deemed total
and permanent: 1. Temporary total disability lasting continuously for more than 120 days
except as otherwise provided in the Rules. Art. 192 c.1 Sec 2, Period of Entitlement- (a)
The income benefit shall be paid beginning on the first day of such disability. If caused by
an injury or sickness, it shall not be paid longer than 120 consecutive days except where
such injury or sickness still requires medical attendance beyond 120 days but not
exceeding 240 days from onset of disability shall be paid. However, the system may
declare the total and permanent status at any time after 120 days of continuous
temporary total disability as may be warranted by the degree of actual loss or impairment
of physical or mental functions as determined by the System.
The court furthermore reiterated that the findings of the company-designated

physicians should prevail. As stated for in the leading jurisprudence in Marlow Navigation
Phil. v. Osias, “the referral to a third doctor is mandatory when: 1. There is a valid and
timely assessment by the company-designated physician and; 2. The appointed doctor of
the seafarer refuted such assessment.” In the instant case the two requirements are
present.
20
SINGSON VS.
ARKTIS MARITIME CORP.
HERNANDO, J.
GR No. 214542 January 13, 2021
DISABILITY BENEFITS; TOTAL AND PERMANENT DISABILITY
DOCTRINE
When a certain sickness or injury causes a temporary and total disability which
lasts continuously for more than 120 days, then such total disability is considered to be
permanent. However, as an exception to this rule, if the said sickness or injury that
caused the temporary total disability requires medical treatment beyond the 120-day
period but not to exceed 240 days, then the employee is only entitled to temporary total
disability benefits until he is declared as either: 1) "fit to work," which stops his
entitlement to disability benefits; or 2) "permanently and totally disabled," which then
entitles him to permanent total disability benefits. In any event, if the 240 days had
lapsed without any certification issued by the company-designated doctor, then the
employee may pursue an action for permanent total disability benefits.
FACTS
Ronnie, a third engineer hired by Fil-Pride Shipping Co., in behalf of a foreign
principal, respondent Prosper Marine Private Ltd. on board “M/T Atlanta 2” for a period of
10 months, sees to set aside the resolution of CA denying him of claim for permanent and
total disability benefits. He boarded the vessel and commenced thereon his employment.
Concurrently, Fil-Pride was replaced by Arktis Maritime Corp. as new manning agent of
Prosper.
Petitioner complained of severe stomach pains and was confined at the Citymed
Hospital in Singapore. Dr. Noel Yao, petitioner's attending physician, declared him fit to
rejoin the vessel with rest on board for three more days. When his condition did not
improve, the petitioner was recommended for repatriation. When he arrived in Manila, he
was referred for medical check-up at the company's accredited clinic, Christian Medical
Clinic, Inc. The company physician diagnosed the petitioner as suffering from
cholecystolithiasis and r/o pancreatic pseudocyst, with a recommendation for surgery. 4
months later, around exactly 134 days from petitioner’s arrival in Manila, he again
underwent examination and was later declared “fit to work” by the physician.
Petitioner filed a complaint against respondents Arktis, Fil-Pride, and Prosper for
the payment of his disability benefits, sickness allowance, refund of medical expenses, as
well as damages and attorneys fees. Petitioner alleged that after he was diagnosed with
the disease and recommended for surgery, Arktis took no action on the same.
Consequently, he consulted Dr. Villanueva who recommended that he undergo an
operation. Due to Arktis' inaction, petitioner claimed that he was forced to undertake
medication at his own expense without receiving any assistance from the respondents. He
further alleged that Arktis denied him his sickness and medical benefits and failed to give
him an assessment of his disability. Considering that he contracted the illness during the
21
term of his employment contract, he maintained that his illness was work-related. The
petitioner was unable to work for more than a year since his medical repatriation.
As a defense the company stated that petitioner was no longer in their employ
after the latter voluntarily disembarked from M/T Atlanta 2. In the absence of an
employment relationship between the parties, respondents claimed that no liability
should attach to them, especially since the petitioner himself freely executed a letter of
appreciation in favor of the company. Respondents also stressed that the petitioner was
already declared fit to work by the company physician.
Respondents filed an appeal before the NLRC which was dismissed for failure of
the company to file a motion of appeal on time. The CA, on the other hand, found merit
on the appeal.
ISSUE
Did the CA commit serious errors of law in ruling that the petitioner Singson is not
entitled to the award of total and permanent disability benefits.
HELD
No, the CA did not commit serious errors of law in ruling that the petitioner
Singson is not entitled to the award of total and permanent disability benefits. The
petition of Singsong is denied claiming that the mere lapse of 120-day period under Art.
198 (c)(1) of the Labor Code does not automatically give rise to a cause of action for a
claim of permanent total disability.
Permanent total disability as stated for in Art. 199 states that- disabilities shall be
total and permanent when 1. Temporary total disability lasting continuously for more than
120 days, except as otherwise provided for in the rules. Rule X, Sec 2 of the Rules and
Regulations implementing Book IV of the Labor Code- which states “Period of entitlement.
— (a) The income benefit shall be paid beginning on the first day of such disability. If
caused by an injury or sickness it shall not be paid longer than 120 consecutive days
except where such injury or sickness still requires medical attendance beyond 120 days
but not to exceed 240 days from onset of disability in which case benefit for temporary
total disability shall be paid. However, the System may declare the total and permanent
status at any time after 120 days of continuous temporary total disability as may be
warranted by the degree of actual loss or impairment of physical or mental functions as
determined by the System. Which is read hand in hand with POEA Standard Employment
Contract Sec. 20 (3) which states, “Upon sign-off from the vessel for medical treatment,
the seafarer is entitled to sickness allowance equivalent to his basic wage until he is
declared fit to work or the degree of permanent disability has been assessed by the
company-designated physician but in no case shall this period exceed 120 days.”
The seafarer, upon sign-off from his vessel, must report to the company-designated
physician within three (3) days from arrival for diagnosis and treatment. For the duration
of the treatment but in no case to exceed 120 days, the seaman is on temporary total
disability as he is totally unable to work. He receives his basic wage during this period
until he is declared fit to work or his temporary disability is acknowledged by the
22
company to be permanent, either partially or totally, as his condition is defined under the
POEA Standard Employment Contract and by applicable Philippine laws. If the 120 days
initial period is exceeded and no such declaration is made because the seafarer requires
further medical attention, then the temporary total disability period may be extended up
to a maximum of 240 days, subject to the right of the employer to declare within this
period that a permanent partial or total disability already exists. The seaman may also be
declared fit to work at any time such declaration is justified by his medical condition.
CF Sharp Crew Management, Inc. v. Taok clearly set out the conditions when an
action for total and permanent disability may prosper, for a seafarer to have basis to
pursue an action for total and permanent disability benefits the following conditions must
be present:
(a) The company-designated physician failed to issue a declaration as to his fitness to
engage in sea duty or disability even after the lapse of the 120-day period and
there is no indication that further medical treatment would address his temporary
total disability, hence, justify an extension of the period to 240 days;
(b) 240 days had lapsed without any certification issued by the company designated
physician;
(c) The company-designated physician declared that he is fit for sea duty within the
120-day or 240-day period, as the case may be, but his physician of choice and the
doctor chosen under Section 20-B(3) of the POEA-SEC are of a contrary opinion;
(d) The company-designated physician acknowledged that he is partially permanently
disabled but other doctors who he consulted, on his own and jointly with his
employer, believed that his disability is not only permanent but total as well;
(e) The company-designated physician recognized that he is totally and permanently
disabled but there is a dispute on the disability grading;
(f) The company-designated physician determined that his medical condition is not
compensable or work-related under the POEA-SEC but his doctor-of-choice and the
third doctor selected under Section 20-B(3) of the POEA-SEC found otherwise and
declared him unfit to work;
(g) The company-designated physician declared him totally and permanently disabled
but the employer refuses to pay him the corresponding benefits; and
(h) The company-designated physician declared him partially and permanently
disabled within the 120-day or 240-day period but he remains incapacitated to
perform his usual sea duties after the lapse of said periods.
When a certain sickness or injury causes a temporary and total disability which
lasts continuously for more than 120 days, then such total disability is considered to be
permanent. However, as an exception to this rule, if the said sickness or injury that
caused the temporary total disability requires medical treatment beyond the 120-day
period but not to exceed 240 days, then the employee is only entitled to temporary total
disability benefits until he is declared as either: 1) "fit to work," which stops his
entitlement to disability benefits; or 2) "permanently and totally disabled," which then
entitles him to permanent total disability benefits. In any event, if the 240 days had
lapsed without any certification issued by the company-designated doctor, then the
employee may pursue an action for permanent total disability benefits.
23
IDUL VS.
ALSTER INT'L. SHIPPING SERVICES, INC.
HERNANDO, J.
June 23, 2021 GR No. 209907
DISABILITY BENEFITS; COMPANY PHYSICIANS AND PHYSICIANS SELECTED BY EMPLOYEES
THEMSELVES
DOCTRINE
A temporary total disability only becomes permanent when 1) the
company-designated physician declares it to be so within the 240-day period; or 2) when
after the lapse of the 240-day period, the company-designated physician fails to make
such declaration.
FACTS
On June 3, 2009, Charlo Idul filed a complaint for total and permanent disability
benefits with damages before the DOLE when he figured in an accident causing a fracture
to his left leg while working as a bosun for Alster Int’l Shipping Services, Inc. He argued
that he was entitled to a Disability Rating of Grade 1 or an equivalent of $60,000.00 in
disability benefits.
In the medical report dated July 6, 2009, Dr. Chuasuan gave Idul a Grade 10
disability rating due to "immobility of the ankle joint in abnormal position." Prior to this,
(March 16, 2009), Idul sought the opinion of his own doctor of choice, Dr. Garduce who,
after a single consultation, assessed Idul to be totally and permanently disabled.
Alster Shipping denied liability for full disability benefits contending that Idul was
assessed by the company-designated physician to be suffering from a Grade 10 disability
only and that the disability rating by Dr. Chuasuan was issued within the 240-day period,
negating any claim that the temporary total disability developed into a permanent total
disability.
The LA ruled in favor of Alster Shipping giving more credence to the findings of Dr.
Lim and Dr. Chuasuan. The NLRC reversed the Labor Arbiter's findings explaining that it is
the loss of earning capacity and not the mere medical significance of the injury that
determines the gravity of disability. The CA upheld the ruling of the LA stressing that a
temporary total disability becomes permanent only when the company-designated
physician declares it to be so within the 240-day period, or when after the lapse of said
period, the physician fails to make such declaration.
ISSUE
Is the petitioner entitled to permanent and total disability benefits.
HELD
24
No, petitioner is not entitled to permanent and total disability benefits. Idul is not
entitled to permanent and total disability benefits. The CA correctly concluded that a
temporary total disability only becomes permanent when 1) the company-designated
physician declares it to be so within the 240-day period; or 2) when after the lapse of the
240-day period, the company-designated physician fails to make such declaration.
In Manaway v. Philippine Transmarine Carriers, Inc., the Court held that:
POEA [SEC] and by applicable Philippine laws. If the 120 days initial period is exceeded
and no such declaration is made because the seafarer requires further medical attention,
then the temporary total disability period may be extended up to a maximum of 240 days,
subject to the right of the employer to declare within this period that a permanent partial
or total disability already exists. The seaman may of course also be declared fit to work at
any time such declaration is justified by his medical condition.
The medical reports issued by Dr. Lim and Dr. Chuasuan reveal that Idul was
examined, treated, and rehabilitated for about seven (7) months. Thereafter, Dr.
Chuasuan's assessment of Idul's disability grading was issued on July 6, 2009 or on the
207th day from December 11, 2008, and therefore, well within the 240-day period.
Clearly, Idul's condition did not become a permanent total disability just by the mere
lapse of the 120-day period, especially since the extension was necessary for his
rehabilitation.
At this point, it bears stressing that the employee seeking disability benefits
carries the responsibility to secure the opinion of a third doctor. In fact, the employee
must actively or expressly request for it. The referral to a third doctor has been
recognized by this Court to be a mandatory procedure. Failure to comply therewith is
considered a breach of the POEA-SEC, and renders the assessment by the
company-designated physician binding on the parties.
25
MABALOT VS.
MAERSK-FILIPINAS CREWING, INC.
HERNANDO, J.
GR No. 224344 September 13, 2021
DISABILITY BENEFITS
DOCTRINE
While there is no law stating that an aggrieved party before the NLRC may file an
appeal before the CA, the same does not mean that an NLRC decision can no longer be
assailed.
The assessment to be conclusive must be complete and definite; otherwise, the

medical report shall be set aside and the disability grading contained therein shall be
ignored. As case law holds, a final and definite disability assessment is necessary in order
to truly reflect the true extent of the sickness or injuries of the seafarer and his or her
capacity to resume work as such.
FACTS
Edgardo Mabalot, a seaman deployed by Maersk-Filipinas Crewing, Inc. to its
foreign principal A.P. Moller A/S, complained to the ship master that he was experiencing
pain on his left shoulder. He underwent medical examination in Honmoku Hospital, Japan
where he was diagnosed with "Omarthritis." He was medically repatriated and was
advised to consult Dr. Natalio G. Alegre II, the company-designated physician for
Maersk-Filipinas Crewing, Inc., wherein he was assessed to be suffering from "Frozen
Shoulder” and underwent an Magnetic Resonance Imaging (MRI). Based on the MRI results,
Dr. Alegre recommended Arthroscopic Debridement and Possible Repair of Anterior
Labrum as treatment. However, Mabalot sought a second opinion from a doctor of his
choice and asked to postpone his treatment. Dr. Alegre thus advised Mabalot to continue
with his physical therapy and consult a Rehabilitation Medicine Specialist.
Dr. Alegre issued a Grade 11 interim disability assessment on Mabalot and was
again told to consult a Rehabilitation Medicine Specialist. Mabalot consulted Dr. Manuel C.
Jacinto, Jr. who issued a Medical Certificate declaring him to be suffering from permanent
total disability and unfit to go back to work. Dr. Jacinto diagnosed Mabalot's condition as
the same diagnosis as that of the company-designated physician.
Mabalot filed his Complaint with the Regional Arbitration Branch of the NLRC for
payment of permanent total disability compensation, moral and exemplary damages and
attorney's fees. He averred that he was entitled to permanent total disability
compensation. The LA ruled that Mabalot was entitled only to disability benefits
corresponding to Grade 11 as assessed by Dr. Alegre. The NLRC modified the decision of
the LA entitling Mabalot to permanent total disability benefits and attorney's fees. The CA
reversed the NLRC Decision and reinstated the LA ruling.
26
Mabalot argued that: 1) his disability was total and permanent; 2) the NLRC
decision is not subject to appeal before the CA since it already became final and
executory 10 days after its promulgation; and 3) that since the parties already reached a
partial settlement at the pre-execution conference, the appellate court should have
dismissed the petition for being moot and academic.
ISSUE
1. Is a decision of the labor tribunal reviewable by the CA.
2. Is Mabalot entitled to permanent total disability benefits.
HELD
1. Yes, the Petition before the CA was not moot and academic. A ruling of the
NLRC can still be the subject of review by the CA through a special civil action for
certiorari under Rule 65 of the Rules of Court.
In St. Martin Funeral Home v. National Labor Relations Commission, the absence of
an appeal from NLRC decisions, does not mean that the same are absolutely beyond the
powers of review of the court. In fact, NLRC decisions may be reviewed by the CA through
a petition for certiorari under Rule 65. While there is no law stating that an aggrieved
party before the NLRC may file an appeal before the CA, the same does not mean that an
NLRC decision can no longer be assailed.
Thus, a decision of the labor tribunal can be properly reviewed by the appellate
court on the ground of grave abuse of discretion.
2. No, Mabalot is not entitled to permanent total disability benefits. The

assessment to be conclusive must be complete and definite; otherwise, the medical
report shall be set aside and the disability grading contained therein shall be ignored. As
case law holds, a final and definite disability assessment is necessary in order to truly
reflect the true extent of the sickness or injuries of the seafarer and his or her capacity to
resume work as such.
The law steps in and considers the seafarer's disability as total and permanent
when the company-designated physician fails to arrive at a definite assessment of the
seafarer's fitness to work or permanent disability within the prescribed periods and if the
seafarer's medical condition remains unresolved.
Records disclose that the Grade 11 disability rating given by Dr. Alegre 110 days
from Mabalot's repatriation, was merely an interim diagnosis. Thus, it cannot be
considered as a definite and final assessment. Mabalot remained in need of medical
attention, a sufficient justification for the extension of the 120-day period to the
maximum period of 240 days in order for the company-designated physician to make a
complete assessment of his injury and recommend the appropriate disability rating, if
any.
27
RODRIGUEZ VS. PHILIPPINE TRANSMARINE CARRIERS, INC.
HERNANDO, J.
GR No. 218311, October 11, 2021
PERMANENT TOTAL DISABILITY OF LABORERS; PERIOD OF ENTITLEMENT; OBLIGATIONS OF
EMPLOYER; REPATRIATION OF SEAFARERS
DOCTRINE
A claim for permanent and total disability benefits may prosper after the lapse of
the 120-day period, but less than 240 days, from the time the seafarer reported for
medical treatment if the company-designated physician failed to declare within the
120-day period that the seafarer requires further medical attention.
FACTS
Edgar Rodriguez was employed as an ordinary seaman by respondent Philippine
Transmarine Carriers, Inc. (PTC). Upon reaching a convenient port in Taiwan in 2012, he
underwent a medical examination and was initially diagnosed with Hepatomegaly; L5
Spondylosis with Lumbar Spondylosis. He was repatriated on October 2, 2012. Two days
later, he reported to PTC and was immediately referred to the company-designated
physician, Dr. Robert D. Lim in Metropolitan Medical Center. Rodriguez was subsequently
diagnosed with Antral Gastritis; H Pylori Infection; Non-Specific Hepatic Nodule; L2-S1
Disc Protrusion and incidental finding of Specific Colitis Cholecystitis. Dr. Lim issued a
medical report indicating Rodriguez’s final disability assessment as equivalent to Grade 8.
Rodriguez subsequently consulted his personal orthopedic surgeon, Dr. Cesar H. Garcia
who found him to be afflicted with multiple disc profusion.
In his Medical Certificate, Dr. Garcia assessed the seafarer to be permanently unfit
for sea duty in whatever capacity with a corresponding Grade 1 disability or a permanent
total disability. In view of Dr. Garcia's assessment, Rodriguez claimed from PTC permanent
total disability benefits. However, PTC insisted that as per Dr. Lim's findings, Rodriguez
was only suffering from a Grade 8 disability, and thus, he was only entitled to partial and
permanent disability benefits. Thus, Rodriguez filed a complaint for permanent total
disability benefits, sickness allowance, medical reimbursement, damages and attorney's
fees.
The Labor Arbiter awarded the seafarer permanent and total disability benefits.
PTC filed an appeal with the National Labor Relations Commission. The NLRC modified the
arbiter's ruling by deleting the award of moral damages, but affirming the award of total
and permanent disability benefits and attorney's fees. PTC then appealed with the Court
of Appeals, which partly found their petition meritorious. It noted that, from October 5,
2012 when Rodriguez underwent MRI up to April 26, 2013 when Dr. Lim issued the final
assessment, only 203 days had lapsed, and therefore, within the 240-day period.
28
ISSUE
Is Rodriguez entitled to permanent and total disability compensation.
HELD
No, Rodriguez is not entitled to permanent and total disability compensation. The
illness of Rodriguez, osteoarthritis, is an occupational disease, and thus, compensable
under Section 32-A(21) of the Philippine Overseas Employment Administration's Standard
Employment Contract, series of 2010 (2010 POEA-SEC).
Disability claims of seafarers are governed by the Labor Code, its implementing
rules and by contract such as the 2010 POEA-SEC, which governed Rodriguez's period of
employment.
Article 192 (c) (1) of the Labor Code defines permanent and total disability of
laborers, to wit:
ART. 192. Permanent Total Disability. —
(c) The following disabilities shall be deemed total and permanent:
(1) Temporary total disability lasting continuously for more than one
hundred twenty days, except as otherwise provided in the Rules;
The rule referred to in the foregoing provision, i.e., Rule X, Section 2 of the
Amended Rules on Employees' Compensation, which implemented Book IV of the Labor
Code (IRR), states:
Sec. 2. Period of entitlement. — (a) The income benefit shall be paid
beginning on the first day of such disability. If caused by an injury or sickness it
shall not be paid longer than 120 consecutive days except where such injury or
sickness still requires medical attendance beyond 120 days but not to exceed 240
days from onset of disability in which case benefit for temporary total disability
shall be paid. However, the System may declare the total and permanent status at
any time after 120 days of continuous temporary total disability as may be
warranted by the degree of actual loss or impairment of physical or mental
functions as determined by the System.
The foregoing provisions should be read together with Section 20 (A) of the 2010
POEA-SEC:
xxx xxx xxx
2. x x x However, if after repatriation, the seafarer still requires medical
attention arising from said injury or illness, he shall be so provided at cost to the
employer until such time he is declared fit or the degree of his disability has been
established by the company-designated physician.
3. In addition to the above obligation of the employer to provide medical

attention, the seafarer shall also receive sickness allowance from his employer in
an amount equivalent to his basic wage computed from the time he signed off
until he is declared fit to work or the degree of disability has been assessed by the
company-designated physician. The period within which the seafarer shall be
29
entitled to his sickness allowance shall not exceed 120 days. Payment of the
sickness allowance shall be made on a regular basis, but not less than once a
month.
xxx xxx xxx
For this purpose, the seafarer shall submit himself to a post-employment

medical examination by a company-designated physician within three working days
upon his return except when he is physically incapacitated to do so, in which case,
a written notice to the agency within the same period is deemed as compliance. In
the course of the treatment, the seafarer shall also report regularly to the
company-designated physician specifically on the dates prescribed by the
company-designated physician and agreed to by the seafarer. Failure of the
seafarer to comply with the mandatory reporting requirement shall result in his
forfeiture of the right to claim the above benefits.
If a doctor appointed by the seafarer disagrees with the assessment, a third

doctor may be agreed jointly between the Employer and the seafarer. The third
doctor's decision shall be final and binding on both parties.
A claim for permanent and total disability benefits may prosper after the lapse of
the 120-day period, but less than 240 days, from the time the seafarer reported for
medical treatment if the company-designated physician failed to declare within the
120-day period that the seafarer requires further medical attention. The court found Dr.
Lim’s assessment as sufficient justification to extend the seafarer's medical treatment
beyond the 120-day period, since the latter still had to undergo further treatment and
evaluation in view of his persistent back problems.
Since Dr. Lim’s final medical assessment was justifiably issued beyond the 120-day
period but within 240 days from the time Rodriguez first reported to him, the Court found
Rodriguez not entitled to his claim for permanent and total disability benefits.
30
DARROCA, JR. VS.
CENTURY MARITIME AGENCIES, INC.
HERNANDO, J.
G.R. No. 234392 November 10, 2021
COMPENSABLE DISABILITY
DOCTRINE
For disability to be compensable, two elements must concur: (1) the injury or
illness must be work-related; and (2) the work-related injury or illness must have existed
during the term of the seafarer's employment contract. It is not sufficient to establish
that the seafarer's illness or injury has rendered him permanently or partially disabled; it
must also be shown that there is a causal connection between the seafarer's illness or
injury and the work for which he had been contracted.
FACTS
Efraim D. Darroca Jr. was continuously hired as a seafarer by respondent Century
Maritime Agencies, Inc. under various employment contracts. On August 12, 2012, Darroca
was rehired by Century for and on behalf of its foreign principal, Damina Shipping
Corporation for a period of seven months. Prior to embarkation, Darroca underwent a
rigid physical and medical examination where he was declared fit for sea duty.
Darroca boarded the vessel MT "Dynasty." However, after one month of working, he
started to experience difficulty in sleeping and extreme exhaustion. He also began to see
unusual visions and hear voices. By October 2012, he experienced dizziness due to the
smell of the fumes of chemicals, loss of appetite, and weakness. Thus, he requested to
have a consultation with Dr. Darell Griffin and was diagnosed with "major depression and
psychomotor retardation.” Darroca was declared unfit for sea duty. Subsequently, he was
repatriated back to the Philippines for further treatment. Darroca was referred to a
company-designated physician who examined him and found his condition not to be
work-related or work-aggravated since there were no elicited conflicts in his associations
within his work environment. The company-designated physician continued to attend to
the medical care of Darroca until the latter abandoned his medical treatment sometime
in November 2012.
Due to his continued incapacity to work, Darroca consulted Dr. Nedy Lorenzo
Tayag, a clinical psychologist. After examination, Darroca was diagnosed to be suffering
from "major depression with psychotic features" and was recommended to undergo
continuous psychological and psychiatric intervention. Darroca filed a complaint for the
payment of his permanent and total disability benefits, sickness allowance, medical
expenses, moral damages, exemplary damages, and attorney's fees against the
respondents.
The Labor Arbiter dismissed the complaint, finding that complainant's medical
condition is not work related or aggravated since complainant failed to dispute
respondents' company-designated physicians' finding that there were no elicited conflicts
31
in his associations within his work environment onboard their vessel. He appealed to the
NLRC which also dismissed his petition and opined that Darroca's mental illness was not
compensable since it did not result from a traumatic injury to the head as required by the
Philippine Overseas Employment Administration-Standard Employment Contract
(POEA-SEC). It noted that Darroca did not mention any accident onboard that could have
caused his injury. The CA likewise denied the petition for lack of merit. Hence, this
petition.
ISSUE
Is Darroca's illness work-related and therefore compensable.
HELD
No, Darroca's illness is not work-related and therefore not compensable. Darroca
failed to establish that his illness is work-related and compensable.It is undisputed that
before repatriation, he was diagnosed to be suffering from major depression and
psychomotor retardation. To prove his illness as work-related, it is necessary for evidence
to show his actual duties, the nature of his illness, and other factors that may lead to the
conclusion that his work conditions brought about, or at the very least, increased the risk
of contracting his complained illness. However, aside from his bare statement that he
worked as an able seaman on board MT "Dynasty," records are bereft of any showing what
his specific duties were. Moreover, his general assertion of experiencing "dizziness when
he smells the fumes of chemicals he was working on" is insufficient to conclude that his
work brought about or increased the risk of his depression.
For disability to be compensable, two elements must concur: (1) the injury or
illness must be work-related; and (2) the work-related injury or illness must have existed
during the term of the seafarer's employment contract. It is not sufficient to establish
that the seafarer's illness or injury has rendered him permanently or partially disabled; it
must also be shown that there is a causal connection between the seafarer's illness or
injury and the work for which he had been contracted.
Century was also able to successfully overturn the legal presumption that Darroca's
illness is work-related. It bears noting that the June 20, 2013 affidavit of Darroca stated
that he was employed under fair working conditions and without any maltreatment by the
officers or crew of the ship. Additionally, he declared that he did not suffer any injury or
any traumatic experiences onboard causing his inability to sleep. Absent any mention of
Darroca's duties and the risks involved in his work, it cannot be reasonably concluded that
it caused or aggravated his depression.
32
MARLOW NAVIGATION PHILS. VS. HEIRS OF BEATO
HERNANDO, J.
G.R. No. 233897 March 09, 2022
DISABILITY BENEFITS
DOCTRINE
In order for a seafarer to be entitled to the compensation and benefits under
Section 20-A, the disability causing the illness, injury or death must be one of those listed
under Section 32, to wit:
1. The seafarer's work must involve the risks described herein;
2. The disease was contracted as a result of the seafarer's exposure to the
described risks;
3. The disease was contracted within a period of exposure and under such other
factors necessary to contract it; and
4. There was no notorious negligence on the part of the seafarer.
The referral to a third doctor has been recognized by this Court to be a mandatory
procedure. Failure to comply therewith is considered a breach of the POEA-SEC, and
renders the assessment by the company-designated physician binding on the parties.
FACTS
Antonio was an Able Seaman engaged by Marlow Navigation Phils., Inc., for and on
behalf of its foreign principal, Marlow Navigation Co. Ltd., on board the vessel MV Geest
Trader for a contract period of 10 months. Prior to embarkation, Antonio underwent a
Pre-Employment Medical Examination and was declared "Fit for Sea Duty." He departed
the Philippines and joined the vessel on July 14, 2012. Sometime in November 2012,
Antonio felt severe abdominal pain, back ache, chest pain and had coughs. Due to the
absence of medical facilities at the port clinic, he did not receive the proper medical
assistance and did not undergo any laboratory test. He was repatriated to the Philippines
due to his medical condition.
Marlow referred Antonio to Dr. Orlino F. Hosaka of the Notre Dame Medico-Dental
Clinic, the company-designated physician, who, in turn, referred him to the company
specialists, particularly a pulmonologist and a cardiologist. Antonio's x-ray results showed
that he has negative infiltrates. He was diagnosed with hypertension secondary to upper
respiratory tract infection. Antonio was advised by Dr. Hosaka to return for further
treatment and examination, but he did not. Instead, Antonio went home to Aklan and was
confined at the St. Gabriel Clinic where he was diagnosed with functional dyspepsia and
subsequently he was also diagnosed with pancreatic cancer. After his discharge, Antonio
was bedridden at home until he died on April 6, 2013. His death certificate indicated that
he died due to cardio respiratory failure with underlying cause of pancreatic cancer. Thus,
his surviving heirs, through his wife, Jonabel D. Beato filed a complaint for death
33
benefits, reimbursement of medical expenses and damages on the ground that the cause
of death of Antonio is a work-related illness.
On the other hand, Marlow contended that the heirs are not entitled to death
benefits because Antonio's death occurred after the termination of his employment
contract. Furthermore, he abandoned his treatment, thus, he is not qualified for these
benefits. Finally, Antonio did not acquire his illness, pancreatic cancer, while he was on
board the vessel, thus, it could not have been a work-related illness. The Labor Arbiter
dismissed the case for lack of merit as it appears that no causal relation between
Antonio's work as an Able Seaman and his pancreatic cancer but ordered Marlow to pay
the heirs the sickness allowance of the late Antonio. The NLRC affirmed the LA decision.
However, the CA reversed such rulings and held that the heirs of the late Antonio are
entitled to death benefits under existing law and jurisprudence.
ISSUE
Is the death of the late Antonio compensable.
HELD
No, the death of the late Antonio is not compensable. Since Antonio was employed
in 2012, Section 20-A of the 2010 POEA-SEC applies in determining the factual issues of
compensability of his pancreatic cancer, and compliance with the POEA-SEC prescribed
procedure for disability determination. This rule should be read together with Section
32-A of the same Contract which enumerates the various diseases deemed to be
occupational and thus, compensable. In short, in order for a seafarer to be entitled to the
compensation and benefits under Section 20-A, the disability causing the illness, injury or
death must be one of those listed under Section 32.
Antonio failed to prove that his illness is compensable as he failed to satisfy all the
conditions under Section 32-A which are, to repeat:
described risks;
In this case, the heirs established that Antonio suffered an illness during the term of his
employment contract. However, he failed to comply with the procedures prescribed under
the POEA-SEC, particularly Section 20-A (3), paragraph 3, which requires the seafarer
must submit himself to a post-employment medical examination within three days upon
his return. Further, he must report regularly to the company-designated physician
specifically on the dates prescribed by the latter. When the seafarer is physically
incapacitated to do so, he must submit a written notice to the agency. Otherwise, his
failure to do so will result in forfeiture of his right to claim his benefits. Paragraph 4 of
the same section further states that if the doctor selected by the seafarer disagrees with
34
the assessment of the company-designated physician, the parties may jointly appoint a
third doctor whose decision shall be final and binding on both parties.
The records reveal an indisputable disagreement between the findings of the
company-designated physician, on one hand, and the physician Antonio approached in
Aklan, on the other hand. Dr. Hosaka even claims that Antonio never made any reference
to any other symptom or condition relating to pancreatic cancer because otherwise, Dr.
Hosaka would have reported it to Marlow. At this point, it bears stressing that the
employee seeking disability benefits carries the responsibility of securing the opinion of a
third doctor. In fact, the employee or the seafarer must actively or expressly request for
it. The referral to a third doctor has been recognized by the Court to be a mandatory
In sum, the Court holds that the late Antonio's pancreatic cancer is not work-related and
therefore, not compensable because he or his heirs failed to prove, by substantial
evidence, its work-relatedness and his compliance with the parameters that the law has
set out with regard to claims for disability and death benefits. While this Court adheres to
the principle of liberality in favor of the seafarer in construing the POEA-SEC, it cannot
allow claims for disability compensation based on surmises. Liberal construction is never a
license to disregard the evidence on record and to misapply the law.
35
PAGLINAWAN VS.
DOHLE PHILMAN AGENCY, INC.
HERNANDO, J.
G.R. No. 230735 April 4, 2022
ENTITLEMENT TO DISABILITY BENEFITS
DOCTRINE
The seafarer must prove by substantial evidence that "there is a reasonable causal
connection between his illness and the work for which he has been contracted." It is
settled that awards of disability compensation cannot be based on mere general
averments or speculations.
Section 20 (A) of the 2010 POEA-SEC provides that for an illness to be

compensable, two elements must concur: (a) the injury or illness must be work-related;
and, (b) the work-related injury or illness must have existed during the term of the
seafarer's employment contract. The first element is the one in contention in this case.
FACTS
Petitioner averred that Dohle employed him as engine and deck fitter for and on
behalf of foreign principal Dohle-IOM (Limited) on board the vessel M/V Tamina. In the
course of his employment, he was constantly exposed to dust and chemicals. He
performed strenuous tasks from time to time. Extreme varying temperatures, harsh sea
weather conditions, frequent adjustment to different time zones, and homesickness,
likewise contributed to his stressful life on board the vessel.
Sometime in July 2013, petitioner suffered loose bowel movement and bloody
stool. He was brought and admitted to Hospital Velmar in Mexico City. He underwent
laboratory examinations and CT scan. There was a note of mass from the rectal margin,
which, after biopsy, showed diffuse lymphoid hyperplasia. He was discharged on August
18, 2013 and was subsequently medically repatriated. Upon repatriation, petitioner was
referred to [Marine Medical Services] Metropolitan Medical Center for treatment under
the care of the company-designated physician. He underwent laparoscopic
cholecystectomy, and was diagnosed with lower gastrointestinal bleeding secondary to
ulcerative colitis; iron deficiency anemia; cholelithiasis; s/p laparoscopic
cholecystectomy.
Despite the treatment, petitioner maintained that he was not restored to his prior
health status. Thus, he sought the opinion of Dr. Bonifacio Q. Flores and of Dr. Rommel F.
Galvez, an Internist-Cardiologist; Dr. Galvez opined that petitioner was unfit in any
capacity to work as a seafarer. Edgardo thus sought payment of disability benefits from
Dohle, which contends that due to the absence of work-relation, Edgardo was not entitled
to such benefit. Dohle terminated Edgardo’s further medical treatment, and paid him
sickness allowance.
36
The Labor Arbiter ruled in favor of Edgardo. The arbiter held that petitioner's
illness is work-aggravated despite absence of evidence to show work-relation. The NLRC
reversed the LA's findings as there was no reasonable connection between petitioner's
work and illness. The CA affirmed the NLRC decision.
Edgardo argues that the presumption of work-relatedness was not disputed by

Dohle because the company-designated physician and his team: (a) will not make a report
unfavorable to the company that retains their services; and, (b) are not specialists on the
medical case of petitioner. Thus, the CA erred in relying on the findings of the
company-designated physician.
ISSUE
Is the petitioner entitled to permanent disability benefits.
HELD
No, the petitioner is not entitled to permanent disability benefits as he failed to
show by substantial evidence that his illness was related to or was aggravated by his
work. The petitioner failed to prove by substantial evidence the work-relatedness of his
illness. Records do not show how his work in the vessel caused the development of his
illness. There is no evidence of the link or relatedness between the illness and his work.
Petitioner merely relied on bare allegations that the work conditions and diet onboard
made him sick.
It is settled that awards of disability compensation cannot be based on mere

general averments or speculations. The same analysis applies to the allegation that his
illness was work-aggravated. Petitioner failed to show by substantial evidence that his
illness was related to or was aggravated by his work.
Section 20 (A) of the 2010 POEA-SEC provides that for an illness to be

compensable, two elements must concur: (a) the injury or illness must be work-related;
and, (b) the work-related injury or illness must have existed during the term of the
seafarer's employment contract. The first element is the one in contention in this case.
Section 32-A provides for the conditions of compensability for listed occupational
diseases: (a) the seafarer's work must involve risks described therein; (b) the disease was
contracted as a result of the seafarer's exposure to the described risks; (c) the disease
was contracted within a period of exposure and under such other factors necessary to
contract it; and, (d) there was no notorious negligence on the part of the seafarer. The
seafarer must prove by substantial evidence that "there is a reasonable causal connection
between his illness and the work for which he has been contracted." Case law teaches
that these conditions apply to those illnesses not listed as an occupational disease in the
2010 POEA-SEC.
In the instant case, it is undisputed that petitioner's illness, ulcerative colitis, is

not listed as an occupational disease in the 2010 POEA-SEC. Thus, there is a disputable
presumption that it is work-related. Petitioner, however, still bears the burden and must
still prove by substantial evidence the reasonable causal connection between his
ulcerative colitis and the nature of his work as engine and deck fitter. In this regard, he
failed.
37
VILLE VS.
MAERSK-FILIPINAS CREWING, INC.
HERNANDO, J.
GR No. 217879 February 01, 2021
COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS
DOCTRINE
The seafarer shall submit himself to a post-employment medical examination by a
company-designated physician within three working days upon his return except when he
is physically incapacitated to do so.
Non-compliance with the post-employment medical examination requirement is

tantamount to a waiver or forfeiture of any right to claim disability benefits.
FACTS
Respondent manning agency Maersk, hired Ville as Chief Cook on board the ship
Adrian Maersk for a period of six months. Before his deployment, Ville underwent a
Pre-Employment Medical Examination (PEME) wherein he was declared as fit for work.
Upon the expiration of his contract on March 1, 2012, Ville disembarked from the vessel.
Upon his arrival in the Philippines, he did not report that he was experiencing any illness
or injury while on board Adrian Maersk.
Ville underwent another PEME as a prerequisite for another deployment. In said

PEME, he disclosed for the first time that he has a history of high blood pressure or
hypertension and has been taking medication. The results of the PEME indicated that Ville
had Coronary Artery Disease. Hence, he was declared "Unfit for Sea Duty."
Under the impression that he contracted the illness while on board Adrian Maersk,
Ville filed a Complaint against the respondents for reimbursement of medical expenses
and sickness allowance, payment of total and permanent disability benefits, moral and
exemplary damages, attorney's fees plus legal interest.
He argued that he has been working for the respondents for seven years under 11
contracts and that he has always been declared fit to work before every embarkation. He
has no medical history of coronary artery disease and that his duties onboard caused him
stress and over fatigue which aggravated his heart ailment.
The respondents argued that: (a) Ville failed to present any evidence that he
suffered any injury or illness during his employment; (b) x x x [he] has not presented
substantial evidence showing that his condition is work-related; (c) [his] illness was
acquired after the expiration of the term of his contract with respondents; (d) since [his]
hypertension is a pre-existing condition, it is not compensable; and (e) by virtue of [his]
failure to submit himself to a post-employment medical examination by the
company-designated doctor within 72 hours or three (3) days upon his repatriation, [Ville]
38
is disqualified from any award of disability compensation. The LA ruled in favor of
petitioner Ville. NLRC affirmed the ruling of LA. CA ruled in favor of respondent.
ISSUE
Is Ville is entitled to his claim for total and permanent disability benefits.
HELD
No, there is no dispute that Ville never reported to his employer that he was
suffering from an ailment while on board Adrian Maersk. Even upon disembarkation, he
did not inform his employer that he was experiencing any illness or that it was aggravated
while on board the vessel. Significantly, Ville did not submit himself for post-employment
medical examination within three working days after disembarkation. It is a settled rule
that non-compliance with the post-employment medical examination requirement is
tantamount to a waiver or forfeiture of any right to claim disability benefits.
Ville was repatriated not because of any medical issue but due to the completion
of his contract. He did not comply with the post-employment medical examination
three-day reportorial requirement. He also prematurely filed his claim for disability
benefits without any medical opinion from the company-designated physician or his
personal doctor. On this score, he clearly did not follow the mandatory requirements of
Section 20 (A) (3) of the 2010 POEA-SEC, even if We were to assume that he suffered an
ailment on board Adrian Maersk.
Ville disembarked on March 1, 2012, a Thursday. He had three working days or

until March 6, 2012 (Tuesday) to undergo a post-employment medical examination. Yet,
he submitted himself to a PEME the next day or on March 7, 2012 (or four working days
after disembarkation). In fine, the prescribed period to undergo post-employment
medical examination had already lapsed. Otherwise stated, by failing to undergo
post-employment medical examination within the prescribed period, Ville is deemed to
have waived his right to claim disability benefits.
39
C.F. SHARP CREW MANAGEMENT VS. JAICTEN
HERNANDO, J.
GR No. 208981 February 01, 2021
DOCTRINE
In case of disagreement between the findings of the company-designated physician
and the seafarer's doctor of choice, both parties may agree to jointly refer the matter to
a third doctor whose decision shall be final and binding on them.
Signing of the Certificate of Fitness to Work effectively released petitioners from

any liability.
FACTS
Jaicten alleged that he was employed by C.F. Sharp, for and on behalf of its
foreign principal JFTL, as a Bosun on board M/V Cumbrian Fisher for nine months. He was
declared fit to work during his pre-employment medical examination. However, he
suffered chest pains which lasted for two days and was brought to the Belfast City
Hospital in Ireland, United Kingdom where he was diagnosed with non-ST myocardial
infarction. The company-designated physician certified Jaicten as fit to work. He sought
the medical opinion of his doctor of choice, Dr. Efren Vicaldo of the Philippine Heart
Center, who declared him unfit to resume sea duties. Hence, Jaicten filed a complaint for
payment of total and permanent disability benefits, moral damages, exemplary damages
and attorney's fees.
Petitioners argued that respondents are not entitled to permanent and total
disability benefits. They claimed that the company-designated physician, Dr. Susannah
Ong-Salvador (Dr. Ong-Salvador), had already declared Jaicten to be fit to resume sea
duties. Jaicten himself even signed the Certificate of Fitness to Work. He was then lined
up for re-employment. However, eight months after being cleared to resume work,
Jaicten filed a claim for disability benefits.
LA ruled in favor of petitioners. The LA noted that Jaicten himself agreed and
confirmed his fitness to work when he signed the Certificate for Fitness to Work which
barred him from claiming disability benefits. NLRC reversed the ruling of LA. The CA
affirmed NLRC.
ISSUE
Is Jaicten is entitled to permanent total disability benefits and attorney's fees.
HELD
No, Jaicten is not entitled to permanent total disability benefits and attorney's
fees. Settled is the rule that the company-designated physician is tasked with assessing
the seafarer's disability, whether total or partial, due to either injury or illness, during the
40
term of the latter's employment. However, his or her assessment is not automatically
final, binding or conclusive on the claimant, the labor tribunal or the courts as its
inherent merits would still be weighed and duly considered. Moreover, the seafarer has
the right to dispute such assessment by consulting his own doctor. In addition, in case of
disagreement between the findings of the company-designated physician and the
seafarer's doctor of choice, both parties may agree to jointly refer the matter to a third
doctor whose decision shall be final and binding on them.
As between the findings of the company-designated physicians who conducted

extensive examination on respondent, on one hand, and Dr. Vicaldo, on the other, who
saw him on only one occasion and did not even perform any medical test to support his
assessment, the former's should prevail.
Moreover, Jaicten's signing of the Certificate of Fitness to Work effectively

released petitioners from any liability arising from his repatriation due to medical
reasons. In the absence of any showing that petitioners coerced or duped him into signing
the said certificate, he should be bound by the conditions thereof. Also, respondent failed
to comply with the third-doctor referral procedure before filing his complaint which
proved prejudicial to his case. In fine, Jaicten's suit for permanent and total disability
benefits lacked bases.
It must also be stated that seafarers and overseas contract workers are not
covered by the term "regular employment" as defined in Article 280 of the Labor Code.29
Thus, petitioners are not under obligation to rehire respondent after the termination of
his contract. Thus, the fact that he was not employed immediately after he was declared
fit to resume sea duties should not be taken against petitioners.
41
DESTRIZA V. FAIR SHIPPING CORPORATION
HERNANDO, J.
G.R. No. 203539 February 10, 2021
DISABILITY BENEFITS
DOCTRINE
For an illness to be compensable, "it is not necessary that the nature of the
employment be the sole and only reason for the illness suffered by the seafarer." It is
enough that there is "a reasonable linkage between the disease suffered by the employee
and his work to lead a rational mind to conclude that his work may have contributed to
the establishment or, at the very least, aggravation of any pre-existing condition he might
have had." The disputable presumption implies "that the non-inclusion in the list of
compensable diseases/illnesses does not translate to an absolute exclusion from disability
benefits." Similarly, "the disputable presumption does not signify an automatic grant of
compensation and/or benefits claim." It is still necessary for the claimant to establish,
through substantial evidence, that his illness is work-related.
FACTS
Florencio B. Destriza, petitioner, filed a complaint for permanent disability
benefits, sickness allowance, medical reimbursement, compensatory, moral, and
exemplary damages, and attorney's fees before the National Conciliation and Mediation
Board (NCMB) against FSC, Cachapero and Boseline, respondents.
Destriza contends that he is entitled to disability benefits as previously awarded by

the PVA because he was suffering from Chronic Calculus Cholecystitis due to development
of gallstones. This is a gallbladder inflammation that may result to gallstones blocking the
opening of the gallbladder into the cystic duct or the cystic duct itself. Further, the hot
temperature and constant meat or high fat diet aboard the vessel caused or aggravated
the development of his gallstones.
The Panel of Voluntary Arbitrators (PVA) ruled that Destriza is not entitled to
permanent disability benefits in view of the declaration of the company physician that he
was fit to work. It also ruled that Destriza is not entitled to attorney's fees. However, the
panel awarded Destriza the amount of US$20,000.00 because he contracted his illness
while on board M/V Cygnus.
The CA modified the PVA's Resolution by deleting the award of US$20,000.00 for
lack of legal basis. It pointed out that the POEA Standard Employment Contract does not
contain any reference to compensation or benefit to be awarded to the seafarer simply
because his illness became apparent while he was on board the vessel or because he was
serving on board the same company for three consecutive contracts.
42
The award could not be classified as disability benefits as defined in the POEA
Standard Employment Contract because Destriza failed to show that his illness was
work-related or that the ship's working conditions aggravated it.
ISSUE
Is Destriza entitled to disability benefits as previously awarded by the PVA.
HELD
No, Destriza is not entitled to disability benefits. Section 20 of Memorandum
Circular No. 9 provides that for an illness or injury to be compensable, it must be
work-related and must be incurred during the term of the seafarer's contract. It defines
work-related illness as "any sickness resulting in disability or death as a result of an
occupational disease listed under Section 32-A of this Contract with the conditions set
therein satisfied." Section 32-A in turn states:
Section 32-A. OCCUPATIONAL DISEASES provides that for an occupational

disease and the resulting disability or death to be compensable, all of the
following conditions must be satisfied:
described risks;
3. The disease was contracted within a period of exposure and under such
other factors necessary to contract it;
Section 32-A likewise enumerates the various diseases that are considered as
occupational diseases when contracted under the working conditions involving the risks
described therein. Notably, the list does not include Chronic Calculus Cholecystitis.
However, Section 20 of Memorandum Circular No. 9 provides that "those illnesses not
listed in Section 32 of this Contract are disputably presumed as work-related."
The Court ruled in the case of Madridejos v. NYK-FIL Ship Management, Inc. that it
is not necessary that the nature of the employment be the sole and only reason for the
illness suffered by the seafarer." It is enough that there is "a reasonable linkage between
the disease suffered by the employee and his work to lead a rational mind to conclude
that his work may have contributed to the establishment or, at the very least, aggravation
of any pre-existing condition he might have had."
In the case at the bar, Destriza failed to establish work-relatedness relative to his
illness. The records do not show that the cause of the development of his gallstones
resulting to Chronic Calculus Cholecystitis was his work as cook aboard the vessel. He
merely presented general averments and allegations that the hot temperature and
constant meat or high fat diet aboard the vessel caused or aggravated the development of
his gallstones. Further, the Court stated in Status Maritime Corporation v. Spouses
Delalamon that disability compensation cannot rest on mere allegations couched in
conjectures and baseless inferences from which work-aggravation or relatedness cannot
43
be presumed. Bare allegations do not suffice to discharge the required quantum of proof
of compensability. Awards of compensation cannot rest on speculations or presumptions.
The beneficiaries must present evidence to prove a positive proposition. Destriza
allegations on work-relatedness were not corroborated by other evidence. Other than his
conjectures of entitlement to compensation, there is nothing in the records to
substantiate the claims that would have justified the award. Therefore, Destriza is not
entitled to illness benefit for failure to establish work-relatedness by substantial
evidence.
44
Post-Employment
KINDS OF EMPLOYMENT
SRL INTERNATIONAL MANPOWER AGENCY VS. YARZA, JR.
HERNANDO, J.
GR No. 207828 February 14, 2022
VALIDITY OF OFFER OF EMPLOYMENT; EMPLOYER-EMPLOYEE RELATIONSHIP; VALID TERMINATION
OF EMPLOYMENT
DOCTRINE
Absent a valid employment contract, the Court must then consider the attendant
circumstances to determine if there is an employer-employee relationship between Akkila
and Yarza. To ascertain the existence of this association, the following elements should be
evident: "(l) the selection and engagement of the employee; (2) the payment of wages;
(3) the power of dismissal; and (4) the employer's power to control the employee's
conduct. The most important element is the employer's control of the employee's
conduct, not only as to the result of the work to be done, but also as to the means and
methods to accomplish it. However, the power of control refers merely to the existence
of the power, and not to the actual exercise thereof. No particular form of evidence is
required to prove the existence of an employer-employee relationship. Any competent
and relevant evidence to prove the relationship may be admitted. However, a finding that
such relationship exists must still rest on some substantial evidence."
FACTS
Respondent Pedro S. Yarza, Jr. alleged that the petitioners SRL International
Manpower Agency (SRL) and Akkila Co. Ltd. UAE, SRL's foreign principal, hired him as a
Project Manager for a duration of two years.
Yarza was repatriated to the Philippines with an instruction to renew his visa, and
with the condition that he should return 10 days after its processing. Although Yarza
complied with all the requirements, petitioners terminated his employment without prior
notice and due process.
According to Yarza, when SRL started processing his documents, he underwent a

medical examination to assess his fitness for work. SRL informed Yarza that he has to
submit to a medical examination since the deployment will be treated as an entirely new
one. SRL then referred Yarza to its accredited clinic, Seamed Medical Clinic (Seamed).
However, Seamed declared that Yarza was unfit for work due to Uncontrolled Diabetes
Mellitus Type II, which was reflected in a Medical Certificate dated May 10, 2011.To his
surprise, he received a termination letter dated May 22, 2011 from Akkila (Short for Akkila
Co. Ltd. UAE and collective name for petitioners). Yarza claimed that he enjoys security
of tenure since he was contracted to serve for 24 months and was hired based on his
credentials. Withal, they failed to prove that he was dismissed based on a just or
45
authorized cause, or under the employment contract. He further asserts that since he was
not a new applicant, he should not have been subjected to a new PEME since his prior
PEME has not yet expired, and that his second PEME should not affect his valid and
existing employment contract. Lastly, Yarza allege that there is an employer-employee
relationship. He enumerates the following circumstances showing that SRL is the local
agency of Al Salmeen/Akkila: 1) Yarza underwent the PDOS prior to his deployment and
the Overseas Placement Association of the Philippines (OPAP) certified that he attended
the PDOS with SRL as recruitment agency; 2) while he was working in UAE, SRL billed him
AED 8,239.00 representing service and medical fees in connection with his employment;
3) SRL purchased Yarza's E-ticket75 for his travel to UAE; and 4) prior to his initial
deployment, Yarza had a series of correspondence with SRL regarding his employment
SRL maintains that the Invoice dated January 27, 2011 does not prove
employer-employee relationship but only shows that it rendered services to Al Salmeen/
Akkila such as the posting of manpower requirements and the processing of Yarza' s
documents including medical service, among others. However, these services were
rendered prior to the issuance of the visit visa. In the same way, the e-mail messages
involving SRL were exchanged prior to the issuance of a visit visa. Thus, SRL asserts that
the controlling document should be the employment contract between Yarza and Al
Salmeen/ Akkila, especially when they communicated with each other directly without
SRL' s involvement.
Consequently, Yarza filed a complaint for illegal dismissal, payment of salary for
the unexpired portion of his contract, refund of transportation fare, and moral damages
against the petitioners.
ISSUE
Is Yarza an employee?
HELD
Yes. Notwithstanding the invalidity of the "Offer of Employment," an
employer-employee relationship exists.
46
For the first element, Akkila selected and engaged the services of Yarza, precisely
because he was deployed through a visit visa under Akkila's instruction and endorsement.
For the second element, Akkila did not deny that it paid Yarza' s wages with the "Offer of
Employment" as reference. Likewise, the third element exists since Akkila has the power
to dismiss Yarza. In fact, it did so when it issued the termination letter dated May 22,
2011. Lastly, the fourth element is present since Akkila had control over Yarza's work
conduct, which included the means and methods he would employ to produce the results
required by the company. Akkila did not show proof that it took no part in directing
Yarza's job output. More importantly, Akkila did not appeal the finding of
employer-employee relationship before the CA. Hence, it is bound by such a conclusion.
Thence, an employer-employee relationship was established notwithstanding the absence
of a valid and POEA-approved contract.
Akkila dismissed the services of Yarza on the ground of disease, which is found in
Article 299 [284] of the Labor Code. However, to be considered valid, the dismissal on the
ground of disease must satisfy two requisites: "(a) the employee suffers from a disease
which cannot be cured within six months and his/her continued employment is prohibited
by law or prejudicial to his/her health or to the health of his/her co-employees, and (b) a
certification to that effect must be issued by a competent public health authority."
Akkila did not present any certification from a competent public health authority
citing that Yarza's disease cannot be cured within six months, or that his employment is
prejudicial to his health or that of his co-employees. Absent this certification, Akldla
failed to comply with Article 299 [284] of the Labor Code as well as Section 8, Title 1,
Book Six of the Omnibus Rules Implementing the Labor Code. In other words, Yarza's
dismissal was not based on a just cause.
Apart from this, Akkila did not accord Yarza procedural due process. It is settled
that "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."
In the case at bar, Akkila did not give Yarza any form of notice or opportunity to
explain his side. Akkila unilaterally dismissed him by simply issuing a letter dated May 22,
2011. Additionally, Akkila sent this termination letter after it had already issued a "new"
Contract of Employment dated April 15, 2011 to him.
47
GINTA-ASON VS.
J.T.A. PACKAGING CORP.
HERNANDO, J.
GR No. 244206 March 16, 2022
EMPLOYER-EMPLOYEE RELATIONSHIP
DOCTRINE
The "four-fold test" in determining the existence of an employer-employee
relationship, to wit: (a) the selection and engagement of the employee; (b) the payment
of wages; (c) the power of dismissal; and (d) the power to control the employee's
conduct.
FACTS
Petitioner Gerome B. Ginta-Ason filed a complaint for illegal dismissal,
non-payment of salary/wages, service incentive leave, 13th month pay, separation pay
and ECOLA, with claims for moral and exemplary damages, and attorney's fees against
Respondents J.T.A. Packaging Corporation and Jon Tan Arquilla.
Ginta-Ason alleged that he was hired by JTA as an all-around driver until his
constructive dismissal on September 5, 2016. He alleged that on that day, he went to
JTA’s office to collect his pay after work. However, instead of allowing Ginta-Ason to
leave, Arquilla, a JTA officer, and allegedly under the influence of alcohol at that time,
hit Ginta-Ason, kicked him several times, threatening his life with a gun, without any
reason. Arquilla then illegally detained Ginta-Ason in the office and was released only the
next day. Out of fear, Ginta-Ason decided not to report to work anymore. He claimed that
he was constructively dismissed because Arquilla made his continued employment
impossible, unbearable, and unlikely.
JTA contended that Ginta-Ason was not its employee as established by several
documents in support thereof which never included Ginta-Ason’s name: 1) copies of its
alpha list of employees as filed with the BIR; 2) payroll monthly reports and 13th month
pay it paid for the years 2015-2016; 3) reports on SSS contributions of its employees
remitted for the years 2015-16; 4) PhilHealth remittance reports on contributions of its
employees in 2016; and 5) Pag-IBIG fund membership and registration/remittance forms
indicating the names of its employees and their contributions for the period of 2015-2016.
The Labor Arbiter rendered a Decision declaring the existence of an

employer-employee relationship between Ginta-Ason and JTA, thus Ginta-Ason had indeed
been constructively dismissed. On appeal, the National Labor Relations Commission
reversed and set aside the Decision of the LA for lack of employer-employee relationship.
The Court of Appeals affirmed the Decision of the NLRC.
ISSUE
Is there an employer-employee relationship between Ginta-Ason and JTA at the
time of the former’s dismissal.
48
HELD
No, there is no employer-employee relationship between Ginta-Ason and JTA at
the time of the former’s dismissal. Settled is the rule that allegations in the complaint
must be duly proven by competent evidence and the burden of proof is on the party
making the allegation. In an illegal dismissal case, the onus probandi rests on the
employer to prove that its dismissal of an employee was for a valid cause. However,
before a case for illegal dismissal can prosper, an employer-employee relationship must
first be established. In this instance, since it is Ginta-Ason here who is claiming to be an
employee of JTA, the burden of proving the existence of an employer-employee
relationship lies upon him. Unfortunately, Ginta-Ason failed to discharge this burden.
Applying the "four-fold test" in determining the existence of an

employer-employee relationship, to wit: (a) the selection and engagement of the
employee; (b) the payment of wages; (c) the power of dismissal; and (d) the power to
control the employee's conduct, the NLRC, as affirmed by the CA, found that Ginta-Ason
failed to prove, by competent and relevant evidence that he is an employee of JTA.
Ginta-Ason presented no document setting forth the terms of his employment,

neither was he able to present a company identification card to prove his employment
with JTA. The Court has held that in a business establishment, an identification card is
usually provided not only as a security measure but mainly to identify the holder thereof
as a bona fide employee of the firm that issues it.
The pay slips allegedly issued by JTA to Ginta-Ason bore no indication whatsoever
as to their source. Absent any clear indication that the amount Ginta-Ason was allegedly
receiving came from JTA, it cannot concretely establish the element of payment of
wages. Additionally, there were no deductions from Ginta-Ason’s supposed salary such as
withholding tax, SSS, PhilHealth or Pag-IBIG Fund contributions which are the usual
deductions from employees' salaries. Thus, the alleged pay slips may not be treated as
competent evidence of Ginta-Ason’s claim that he is JTA's employee.
As to the power of control, Ginta-Ason insisted that the copies of driver's itinerary
issued by JTA clearly manifest that it exercised control over the means and methods by
which Ginta-Ason performed his tasks, however, the NLRC pertinently observed that the
said driver's itineraries were not signed by JTA's authorized personnel. In other words, the
said driver's itineraries failed to give details on who specifically dispatched Ginta-Ason.
The driver's itineraries did not adequately establish the element of control.
49
JOVERO V. CERIO
HERNANDO, J.
GR No. 202466 June 23, 2021
TESTS TO DETERMINE WHETHER AN EMPLOYEE IS A PROJECT EMPLOYEE.
DOCTRINE
The principal test in determining whether an employee is a project employee is
whether he/she is assigned to carry out a "specific project or undertaking," the duration
and scope of which are specified at the time the employee is engaged in the project, or
where the work or service to be performed is seasonal in nature and the employment is
for the duration of the season. A true project employee should be assigned to a project
which begins and ends at determined or determinable times, and be informed thereof at
the time of hiring.
FACTS
Respondents Rogelio Cerio, et al. were hired on various dates by Sigma
Construction and Supply, an independent contractor owned by Petitioner Eduardo G.
Jovero. As cement cutters, Cerio, et al. were assigned to work at the drilling site of
Philippine Geothermal, Inc. (PGI), beginning in April 1990. However, PGI pre terminated
one of its contracts with Sigma on April 1, 1993, which was initially supposed to end on
October 31, 1993. Due to such termination, the project manager of Sigma issued a notice
to all cement cutters, informing them that the contract with PGI will be effective only
until April 30, 1993.
Sometime in August 1993, Cerio, et al. filed a complaint for illegal dismissal,
underpayment of wages and non-payment of labor standard benefits against Sigma and
PGI. Jovero alleged that Sigma is an independent contractor that hired Cerio, et al. as
project employees to work on the former's projects with PGI. Necessarily, when PGI
pre-terminated its latest contract with Sigma, the latter was forced to terminate the
employment of Cerio, et al. seeing that the need for their services was dependent on its
contract with PGI. Simply put, Cerio, et al.'s services were coterminous with Sigma's
projects with PGI. Therefore, they were hired and rehired in accordance with the
duration of Sigma's contracts with PGI.
On the other hand, Cerio, et al. argued that they were not just project employees
because they were continuously hired and assigned to different PGI projects from the
beginning of their employment in 1990 until their recent termination in 1993. In fact,
Cerio, et al. were even transferred to other projects prior to the completion of a
previously assigned project. They also claimed that they were not limited to performing
work as cement cutters, but they also cleaned canals and pipes, fixed tools, and other
related work at PGI.
The Labor Arbiter rendered a Decision ruling that Cerio, et al. were regular
employees of Sigma. On appeal, the National Labor Relations Commission (NLRC) set aside
50
the Decision of the LA. Thus, Cerio, et al. filed a petition for Certiorari with the Court of
Appeals (CA), who then set aside the Decision of the NLRC and reinstated the Decision of
the LA.
ISSUE
Are Cerio, et al. regular employees of the petitioner and, thus, were illegally
dismissed.
HELD
Yes, the Supreme Court concurs with the findings and conclusions of the LA and
the CA that Cerio, et al. were regular employees of Sigma.
The case of Olongapo Maintenance Services, Inc. v. Chantengco is applicable:
The principal test in determining whether an employee is a project

employee is whether he/she is assigned to carry out a "specific project or
undertaking," the duration and scope of which are specified at the time the
employee is engaged in the project, or where the work or service to be performed
is seasonal in nature and the employment is for the duration of the season. A true
project employee should be assigned to a project which begins and ends at
determined or determinable times, and be informed thereof at the time of hiring.
In the instant case, the record is bereft of proof that the respondents'
engagement as project employees has been predetermined, as required by law. We
agree with the Court of Appeals that OMSI did not provide convincing evidence
that respondents were informed that they were to be assigned to a "specific
project or undertaking" when OMSI hired them. Notably, the employment contracts
for the specific project signed by the respondents were never presented. All that
OMSI submitted in the proceedings are the service contracts between OMSI and the
MIAA. Clearly, OMSI utterly failed to establish by substantial evidence that, indeed,
respondents were project employees and their employment was coterminous with
the MIAA contract.
Jovero supports his argument that Cerio, et al. are only project employees by
attaching Sigma's Service contracts with PGI with its Memorandum of Appeal filed with the
NLRC. However, nowhere in the contracts did it show that Cerio, et al were parties to
such contract. More importantly, it did not prove that Cerio, et al were hired for the
projects with PGI. The presentation of service contracts between the employer and their
client (even if it shows the duration of the project), in lieu of the employees' individual
employment contracts, does not establish that the latter are project employees. There
was no other substantial evidence offered to prove that Cerio, et al were informed at the
time of their hiring, that they were project employees.
Thus, Jovero failed to prove through substantial evidence that Cerio, et al are
project employees. It is evident that Cerio, et. al. were illegally dismissed due to
petitioner's failure to comply with the substantive and procedural due process tenets
under the Labor Code.
51
ENGINEERING & CONSTRUCTION CORPORATION OF ASIA VS. PALLE
HERNANDO, J.
GR No. 201247 July 13, 2020
PROJECT EMPLOYEES
DOCTRINE
In Lopez v. Irvine Construction Corp., it was held that the principal test for
determining whether particular employees are properly characterized as 'project
employee' as distinguished from 'regular employees,' is whether or not the 'project
employees' were assigned to carry out a 'specific project or undertaking,' the duration and
scope of which were specified at the time the employees were engaged for that project.
FACTS
Petitioner Engineering & Construction Corporation (ECCA) is a domestic
corporation engaged in the construction business. Respondents Palle, et al. (Palle) were
hired by ECCA on various dates to work in its construction business. Palle filed a complaint
for illegal dismissal against ECCA.
ECCA argued that Palle, as project employees, were validly terminated in view of
the project's completion. It pointed out that Palle were not regular employees, but
merely project employees since they were hired for a specific project or undertaking, the
termination of which was determined at the time they were hired. ECCA further argued
that the company hired Palle as project employees to work at its various construction
projects from the year 1990; it informed them of the scope and duration of their work at
the time they were engaged in each of those projects; and their project employment
contract expired upon completion of the specific project. Consequently, they were also
separated from service upon completion of each project.
On the other hand, Palle alleged that they were not project employees but were
regular employees of ECCA. They claimed that ECCA hired them on different dates to
perform tasks which were necessary and desirable in its construction business. However,
ECCA informed them that the cause of their termination was "project completion.” They
claimed that ECCA continuously employed them for different construction projects of the
company. However, they did not enjoy the benefits given by the company to its regular
employees. Although they may have signed employment contracts for some of ECCA's
projects, they were asked to work on new projects or transferred to other existing
projects without the benefit of corresponding employment contracts. Furthermore, they
claim that ECCA's failure to report the termination of their employment to the DOLE every
time that the company completed a project proved that Palle were not project employees
but regular employees. Thus, as regular employees, they were entitled to all the benefits
and rights appurtenant to a regular employee, including security of tenure.
52
The Labor Arbiter ruled in favor of Palle, holding that they were regular employees
of ECCA. On appeal with the National Labor Relations Commission by ECCA, the NLRC
reversed the findings of the LA and granted the petition of ECCA. On appeal to the CA by
Palle, CA held in favor of Palle and ruled that they were regular employees, and were
therefore illegally dismissed.
ISSUE
Are Palle, et al. illegally dismissed as regular employees; or validly terminated in
view of the completion of their contract as project employees.
HELD
Yes, Palle, et al. are REGULAR EMPLOYEES were ILLEGALLY DISMISSED as regularly
employees. Article 295 [280] of the Labor Code provides the definition of regular and
project employees.
ARTICLE 295. [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 service 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.
Based on the foregoing provisions, an employment is generally deemed regular

where: (i) the employee has been engaged to perform activities which are usually
necessary or desirable in the usual business or trade of the employer, subject to
exceptions, such as when one is a fixed, project or seasonal employee; or (ii) the
employee has been engaged for at least a year, with respect to the activity he or she is
hired, and the employment of such employee remains while such activity exists
employment shall continue while such activity exists.
Based on the foregoing provisions, an employment is generally deemed regular

where: (i) the employee has been engaged to perform activities which are usually
hired, and the employment of such employee remains while such activity exists.
53
On the other hand, a project employee “is one whose 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.” Thus, the “services of
project-based employees are coterminous with the project and may be terminated upon
the end or completion of the project or a phase thereof for which they were hired.”
In Lopez v. Irvine Construction Corp., it was held that the principal test for
determining whether particular employees are properly characterized as 'project
In the instant case, it is essential to determine whether notice was given to Palle
that they were being engaged just for a specific project, which notice must be made at
the time of hiring.
Upon careful review of the company's respective contracts of employment with

Palle, et al., such were lacking in details to prove that Palle, et al. had been duly
informed of the duration and scope of their work, and of their status as project
employees at the time of their hiring. The respective contracts of Palle, et al. may have
been dated at the time of their issuance, but nowhere did said contracts show as to when
Palle, et al. supposedly signed or received the same or were informed of the contents
thereof. This gives rise to the distinct possibility that Palle, et al. were not informed of
their status as project employees, as well as the scope and duration of the projects that
were assigned to them at the time of their engagement.
Settled is the rule that “although the absence of a written contract does not by
itself grant regular status to the employees, it is evidence that they were informed of the
duration and scope of their work and their status as project employees at the start of
their engagement. When no other evidence is offered, the absence of employment
contracts raises a serious question of whether the employees were sufficiently apprised at
the start of their employment of their status as project employees.”
It is necessary to note that an employer has the burden to prove that the
employee is indeed a project employee. Thus, the employer must establish that (a) the
employee was assigned to carry out a particular project or undertaking; and, (b) the
duration and scope of which was specified at the time of engagement. Thus, ECCA’s
indisputably failed to discharge its burden to prove that Palle, et al. were project
employees. As a result, Palle, et al., as regular employees, may only be dismissed for just
or authorized causes and upon compliance with procedural due process.
54
V PEOPLE MANPOWER PHILS., INC. VS. BUQUID
HERNANDO, J.
GR No. 222311 February 10, 2021
SEAFARER; DISABILITY BENEFITS
DOCTRINE
In order to be considered a seaman or seafarer, one would have to be, at the very
least, employed in a vessel engaged in maritime navigation. Thus, it is clear that those
employed in non-mobile vessels or fixed structures, even if the said vessels/structures are
located offshore or in the middle of the sea, cannot be considered as seafarers under the
law.
An overseas employee, in order to be considered as a "seafarer," must not only

perform tasks concerning manning marine vessels or marine navigation, but they must
also perform such functions onboard a vessel engaged in maritime navigation or a mobile
offshore rig or drilling unit in the high seas.
FACTS
Petitioner V People Manpower Phils., Inc. hired Dominador, for and on behalf of its
principal, Cape Papua New Guinea Ltd. (hereafter, Cape PNG) as a Deck Crew/Rigger for
an estimated period of six (6) months. Before his deployment, Dominador underwent and
passed the routine Pre-employment Medical Examination (PEME). He commenced his work
at the KUMUL Project site after he was declared as "fit to work" by the
company-designated physician. On March 26, 2012, Dominador felt persistent stomach
pains. The next day, he was brought to a hospital where he underwent an appendectomy.
He was eventually diagnosed with Stage 3 Colon Cancer.
Despite undergoing surgery and treatment, Dominador's condition did not improve,
prompting him to consult Dr. Jhade Lotus P. Peneyra, an oncologist, for a second opinion.
Dr. Peneyra issued several medical abstracts which stated that Dominador's illness was
occupation related/aggravated and that he was permanently unfit for sea duties as a
seaman in any capacity. Dominador initiated a claim for disability benefits with
petitioners, pursuant to the Philippine Overseas Employment Administration (POEA)
Standard Employment Contract (POEASEC). However, his claim was denied. Thus,
Dominador filed a complaint with the National Labor Relations Commission (NLRC) for
permanent and total disability benefits.
Dominador claimed that during his employment, he was constantly exposed to

fumes, fuel oils, gas, dust and other harmful chemicals. He also performed strenuous
tasks such as lifting, carrying, pulling, pushing or moving objects on board. His work
stretched up to a minimum of twelve (12) hours a day or night. Being on board, he was
likewise exposed to the harsh elements of the sea, severe weather conditions and the
extreme hot temperatures of the engine room and control room as well. Such work
environment caused physical and mental stress. Besides, their diet onboard was high on
55
carbohydrates and fat. Given these circumstances and the medical abstracts of Dr.
Peneyra, Dominador asserted that he is a seafarer entitled to permanent and total
disability benefits under the POEA-SEC.
On the other hand, V Manpower maintained that it is registered with the POEA as a
land-based agency authorized to recruit, process, and deploy land-based workers and not
seafarers. It claimed that upon the instructions of its principal, it processed Dominador's
engagement as a land-based worker for an estimated period of six (6) months from
January 17, 2012 to July 2012 or up to the completion of the project, whichever comes
first. Thus, it came as a surprise that Dominador was claiming disability benefits as a
seafarer and not as a land-based worker.
The LA held that Dominador was employed as a seafarer whose illness is

compensable under the POEA-SEC. Aggrieved, petitioners filed an appeal with the NLRC
proper which reversed the judgment of the LA and ruled that Dominador was a land-based
employee and not a seafarer. Dominador filed a Petition for Certiorari with the CA. The
CA promulgated the assailed Decision granting the petition and reinstating the August 29,
2013 Decision of the LA.
ISSUE
Is Dominador employed as a seafarer.
HELD
No, Dominador cannot be considered as a seafarer and is thus not covered by the
provisions of law applicable to seafarers only. Article 13(g) of the Labor Code defines a
"seaman" as “any person employed in a vessel engaged in maritime navigation.” What is
crucial is that the employee is employed or engaged or works in any capacity on board a
ship engaged in maritime navigation in accordance with the Labor Code. However, in
order to be considered a "ship" for the purpose of defining a "seafarer," the said "ship"
must not navigate exclusively in inland waters or waters within, or closely adjacent to,
sheltered waters or areas where port regulations apply. Again, this is still consistent with
the intent of the law. Those employed in non-mobile vessels or fixed structures, even if
the said vessels/structures are located offshore or in the middle of the sea, cannot be
considered as seafarers under the law.
Part I, Rule II (38) of the 2003 POEA Rules and Regulations Governing the
Recruitment and Employment of Seafarers (2003 POEA Seafarer Rules) defines "seafarer"
by expressly including fishermen, cruise ship personnel and those serving on foreign
maritime mobile offshore and drilling units, to wit: 38. Seafarer - refers to any person
who is employed or engaged in any capacity on board a seagoing ship navigating the
foreign seas other than a government ship used for military or non-commercial purposes.
The definition shall include fishermen, cruise ship personnel and those serving on foreign
maritime mobile offshore and drilling units. Accordingly, the definition under the 2003
POEA Seafarer Rules, when read together with Article 13(g) of the Labor Code, should still
mean that the fishermen and cruise ship personnel must be employed in a vessel engaged
in maritime navigation. Otherwise, fishermen employed in river boats or personnel in
56
cruises meant to traverse inland waters may be considered as "seafarers," which is
obviously divergent from the intent of the law. Pursuant to the law, these vessels must
still be engaged in maritime navigation, which is what the qualifying term "mobile" should
be interpreted to mean. Clearly, the intent was to exclude those employees working in
non mobile vessels or fixed structures from this definition.
While the Supreme Court agree with his arguments that the nature of an
employee's work is not dependent on the title or designation as stipulated by the parties,
or on the mere allegations of the parties, the applicable law defines a "seafarer" based
not only on the employee's kind of work, but also on the kind of marine vessel or offshore
unit the employee was aboard during his employment. Stated otherwise, an overseas
employee, in order to be considered as a "seafarer," must not only perform tasks
concerning manning marine vessels or marine navigation, but they must also perform such
functions onboard a vessel engaged in maritime navigation or a mobile offshore rig or
drilling unit in the high seas.
Therefore, Dominador was clearly not a seafarer under any of the definitions
provided under law or jurisprudence, during the subject employment period with
petitioners, and hence, is not entitled to any of the benefits reserved for seafarers under
the law, such as the permanent and total disability benefits found in the POEA-SEC.
57
CABATAN VS.
SOUTHEAST ASIA SHIPPING CORP.
HERNANDO, J.
GR No. 219495, February 28, 2022
2000 AMENDED STANDARD TERMS AND CONDITIONS GOVERNING THE OVERSEAS
EMPLOYMENT OF FILIPINO SEAFARERS ON-BOARD OCEAN-GOING SHIPS
DOCTRINE
In order to claim compensability under Section 20 (B) paragraph 6 of the 2000
POEA-SEC, it is required that the seafarer must have: (1) suffered a work-related illness
or injury during the term of his contract; and (2) submitted himself to a mandatory
post-employment medical examination within three (3) working days upon his arrival.
The rationale behind the rule can easily be divined. Within three days from
repatriation, it would be fairly easy for a physician to determine if the illness was
work-related or not. After that period, there would be difficulty in ascertaining the real
cause of the illness.
FACTS
Petitioner Reynaldo P. Cabatan was employed as an oiler by Southeast Asia
Shipping Corp. (SEASCORP) on behalf of its principal, Maritime Management Services
(Maritime Management). Before deployment, he underwent his Pre-Employment Medical
Examination (PEME) and was certified to be fit for sea duty. After which, he boarded M/V
BP Pioneer under a three-month contract.
While on a 12 hour duty, he was carrying spare parts along with a heavy connecting
rod when the vessel suddenly swayed due to the big waves which caused him to bend and
nearly fall to his knees causing him excruciating pain in his scrotal/inguinal area. He went
to the ship's clinic to have himself checked by the doctor on board who advised him to
rest until further observation since it may just be due to tiredness and ruled out hernia
and trauma.
However, the pain still persisted up until after the expiration of his contract.
Cabatan disembarked the vessel at the port of Takoradi, Ghana and was repatriated back
to the Philippines. Eventually, SEASCORP called him for possible deployment. He was sent
to Merita Diagnostic Clinic (Merita), the company-accredited clinic, for his PEME. During
his examination, Cabatan informed the doctor about the injury sustained while on board.
Thus, the doctor asked him to get an x-ray of his scrotal/inguinal area and lumbar spine.
Cabatan also underwent Magnetic Resonance Imaging (MRI) which revealed findings
compatible with a mild chronic lumbar radiculopathy
Cabatan further consulted Dr. Detabali of the De los Santos Hospital who advised
him to have L4-S1 Laminectomy and L4-L5 Instrumented Posterolateral Fusion. Due to the
costly price of the procedures, Cabatan asked for financial assistance from SEASCORP
through its crewing manager, Mr. Aguinaldo, considering that he sustained his injury during
his employment. Mr. Aguinaldo promised to relay the request to its principal, Maritime
58
Management, but the request was left unheeded. Cabatan filed a complaint against the
respondents for permanent and total disability benefits.
Respondents maintained that during Cabatan's last employment contract, he

underwent PEME and was certified fit for sea duty. Upon completion of his contract on
May 25, 2010, Cabatan disembarked the vessel. When he arrived in Manila, Cabatan did
not report to the manning agency for the mandatory post-employment medical
examination, nor request for medical assistance for any injury or illness.
The LA ruled in favor of Cabatan and found that Cabatan suffered an injury while
performing his duties as an oiler. Being a work-related injury, it held that it must be
compensable. Aggrieved, respondents filed an appeal before the NLRC. NLRC reversed and
set aside the LA's Decision and dismissed Cabatan's claim for disability benefits for lack of
merit. Aggrieved, Cabatan filed a petition for certiorari before the CA. The CA denied
Cabatan's appeal.
ISSUE
Is the petitioner entitled to disability compensation for the injury/illness suffered
during the term of his employment with respondents pursuant to Section 20 (B) paragraph
6 of the 2000 POEA-SEC.
HELD
No, petitioner is not entitled to disability compensation for the injury/illness
suffered during the term of his employment. In order to claim compensability under the
forgoing section, it is required that the seafarer must have: (1) suffered a work-related
illness or injury during the term of his contract; and (2) submitted himself to a mandatory
post-employment medical examination within three (3) working days upon his arrival.
To ignore the rule would set a precedent with negative repercussions because it
would open the floodgates to a limitless number of seafarers claiming disability benefits.
It would certainly be unfair to the employer who would have difficulty determining the
cause of a claimant's illness considering the passage of time. In such a case, the
employers would have no protection against unrelated disability claims.
Based on the foregoing, Cabatan's claim for disability benefits and other monetary
awards prayed for by him must be denied. It is evident that Cabatan was repatriated due
to the expiration of his contract. Regardless of the cause of his repatriation, he was
required to submit himself to a post employment medical examination by the
company-designated physician within three working days upon his return in order to
ascertain if he was really suffering from a work-related injury or illness. Cabatan may only
be excused from such a requirement if he was physically incapacitated to do so. However,
such is not the case at bar.
59
PALGAN VS.
HOLY NAME UNIVERSITY
HERNANDO, J.
GR No. 219916 February 10, 2021
GOVERNING LAW FOR THE EMPLOYMENT STATUS OF TEACHERS/PROFESSORS/INSTRUCTORS
DOCTRINE
The Court thus laid down the criteria under which fixed-term employment could
not be said to be in circumvention of the law on security of tenure, thus:
1. The fixed period of employment was knowingly and voluntarily agreed upon by the
parties without any force, duress, or improper pressure being brought to bear upon
the employee and absent any other circumstances vitiating his consent; or
2. It satisfactorily appears that the employer and the employee dealt with each other
on more or less equal terms with no moral dominance exercised by the former or
the latter.
As applied in this case, the fixed-term contracts presented as evidence would

reveal that the parties intended that their employee-employer relationship would last
only for a specific period. Considering petitioner's part-time status, even if no written
fixed-term contract was presented, judicial notice can be made upon the fact that
teachers' employment contracts are for a specific semester or term.
FACTS
Petitioner Arlene Palgan filed a complaint for illegal dismissal against Holy Name
University (HNU). She alleged that even though she was already a regular employee, HNU
did not renew her contract of employment without due process.
Petitioner started working in HNU's College of Nursing while awaiting the results of
her Nursing Board Examination. She alleged that upon her hiring, HNU did not inform her
of the standards for the evaluation of her satisfactory completion of her probationary
period. Sometime in the year 2004, Arlene rejoined HNU and was given a full-time load
for the S.Y. 2004-2005.11 For S.Y. 2005-2006 and 2006-2007, petitioner signed contracts
for term/semestral employment. However, in a notice dated February 28, 2007, HNU
informed Arlene that her contract of employment, which would have expired on March
31, 2007, will no longer be renewed.
Petitioner argued that since she taught at HNU for more than six consecutive
regular semesters, she already attained the status of a regular employee pursuant to the
Manual of Regulations for Private School Teachers. She alleged that upon her hiring, HNU
did not inform her of the standards for the evaluation of her satisfactory completion of
her probationary period. Upon her reelection as Municipal Councilor for the 2001-2004
term, she took a leave of absence from HNU.
60
There having been no valid or justifiable cause for her dismissal as she was not
guilty of any infractions under the Labor Code or the Manual of Regulations for Private
School Teachers, petitioner claimed that her employment was illegally terminated.
On the other hand, respondents contended that in S.Y. 2004-2005, 2005-2006 and
2006-2007, Arlene remained a probationary employee. The completion of her
probationary period did not automatically make her a permanent employee since she
failed to comply with all the conditions of her probationary employment satisfactorily.
Respondents insisted that Arlene was not dismissed; rather, her contract of employment
merely expired on March 31, 2007.
The LA dismissed Arlene's complaint for lack of merit. Since her employment was
probationary in nature, she has no vested right yet to a permanent appointment until
after the completion of the prerequisite three-year period for the acquisition of a
permanent status. The NLRC denied Arlene's appeal and affirmed the ruling of the Arbiter.
However, on reconsideration, the NLRC reversed its earlier pronouncement. Respondents
assailed the NLRC's March 27, 2013 Resolution through a Motion for Reconsideration but it
was denied by the NLRC. This denial prompted the respondents to file a Petition for
Certiorari under Rule 65 of the Rules before the CA. CA reversed the decision of the NLRC,
hence the instant petition.
ISSUE
Was the petitioner illegally terminated.
HELD
No. The governing law for the employment status of
teachers/professors/instructors are the manuals of regulations for private schools. The
Manual of Regulations for Private Schools and not the Labor Code determines whether or
not a faculty member in a private educational institution has attained a permanent or
regular status.
Petitioner did not meet all the criteria required to be considered as a permanent
employee. The Supreme Court has laid down in Lacuesta the following requisites before a
private school teacher acquires permanent status, namely: 1) The teacher serves
full-time; 2) he/she must have rendered three consecutive years of service; and 3) such
service must have been satisfactory. While Arlene has rendered three consecutive years of
satisfactory service, she was, however, not a full-time teacher at the College of Nursing of
HNU. It must be stressed that only a full-time teaching personnel can acquire regular or
permanent status.
Arlene was never qualified to be a full-time faculty due to the apparent lack of the
required clinical experience under the law. The three-year or one-year clinical practice
experience is a minimum academic requirement to qualify as a faculty member in a
college of nursing, and is therefore, required for one to be considered as a full-time
faculty of such. As applied in this case, Arlene failed to meet the required minimum
clinical practice experience under the law. It can be reasonably presumed that when
61
Arlene was engaged for employment, she and HNU were aware of the fact that the former
cannot attain permanency due to her lack of the minimum academic requirements. Thus,
there was no intention for Arlene to be placed under probation, as she cannot acquire
permanency anyway. Rather, the evidence on record would reveal the intent of the
parties to enter into an employment contract for a fixed-term.
1. The fixed period of employment was knowingly and voluntarily agreed upon by
the parties without any force, duress, or improper pressure being brought to
bear upon the employee and absent any other circumstances vitiating his
consent; or
2. It satisfactorily appears that the employer and the employee dealt with each
other on more or less equal terms with no moral dominance exercised by the
former or the latter.

The High Court concluded that Arlene was validly contracted for a fixed-term. The
expiry of her latest contract on March 31, 2007, effectively ended the employee-employer
relationship she had with HNU. No dismissal, whether illegal or not, ever happened.
Therefore, she is not entitled to any of the reliefs sought.
62
Post-Employment
TERMINATION OF EMPLOYMENT BY EMPLOYER
UNIVERSITY CORDILLERAS VS. LACANARIA
OF THE
HERNANDO, J.
DUE PROCESS UNDER THE LABOR CODE; TOTALITY OF INFRACTIONS RULE; MANAGEMENT
PREROGATIVE; EXPERTISE OF LABOR TRIBUNALS; INTENT TO RESIGN AND PREVENTIVE
SUSPENSION
DOCTRINE
The totality of infractions or the number of violations committed during the period
of employment shall be considered in determining the penalty to be imposed upon an
erring employee. Actual hearing or conference is not a condition sine qua non for
procedural due process in labor cases but formal hearing or conference becomes
mandatory only when requested by the employee in writing or substantial evidentiary
disputes exist or a company rule or practice requires it, or when similar circumstances
justify it.
Preventive suspension is not a penalty but a disciplinary measure to protect life or
property of the employer or the co-workers pending investigation of any alleged infraction
committed by the employee. Thus, it is justified only when the employee's continued
employment poses a serious and imminent threat to the employers or coworkers' life or
property. When justified, the preventively suspended employee is not entitled to the
payment of his salaries and benefits for the period of suspension.
FACTS
Petitioner University of the Cordilleras employed respondent Benedicto F.
Lacanaria as an Instructor-Associate Professor at the College of Teacher Education (CTE) in
June 2005. One of Lacanaria's students, Rafael Flores, fainted during a dance presentation
in his class. Lacanaria ignored him and initially refused to let Flores proceed to the clinic.
Flores was diagnosed to have "costochondritis and upper respiratory tract infection”, he
sought Lacanaria to report what had happened to him but Lacanaria dismissed him and
said to him "tae mo!" Due to the incident, Flores filed a written complaint against
Lacanaria. Prior to this incident, Lacanaria was already verbally reprimanded by the Dean
of CTE due to him delivering "green jokes" in his classes.
The University issued to Lacanaria a Charge Sheet with Notice of Investigation for
serious misconduct and violation of the Code of Ethics for Professional Teachers. Lacanaria
filed his Answer in March 17, 2010 wherein he denied the charges against him. The
Grievance Committee issued a Notice of Hearing dated March 26, 2010 for the March 30,
2010 hearing. They also informed Lacanaria of the hearing through a text message on
March 27, 2010. Lacanaria failed to attend said hearing. They then informed him of the
next hearing on April 7, 2010 through registered mail, stating that his failure to attend
63
would constitute a waiver of his right to present his evidence. Lacanaria received the
notice on the same date as the hearing. The Grievance Committee recommended the
dismissal of Lacanaria. On May 15, 2010, the VP for Administration issued a Notice of
Decision, which stated that Lacanaria is dismissed effective on the close of office hours on
May 15, 2010. Lacanaria allegedly received the said notice on May 21, 2010.
He then filed for a Motion of Reconsideration and questioned why he was not given
a teaching load even while there was still no final and executory decision yet regarding
his case. He argued that the ruling which ordered his dismissal came from the Office of
the VP for Administration which cannot be considered as the decision of the President.
The University's President denied Lacanaria's motion for reconsideration in a Resolution
dated June 24, 2010 and stated that since Lacanaria did not take advantage of his
opportunity to be heard, he can no longer question the ruling.
The Executive Labor Arbiter (ELA) held that Lacanaria was validly dismissed in
light of his improper actions and found that Lacanaria was afforded due process since he
was given a notice of the charge and he submitted his Answer thereto. The University also
conducted hearings but Lacanaria failed to appear despite notice which constituted a
waiver to present his evidence. The National Labor Relations Commission held that
Lacanaria committed acts of serious misconduct and ruled that the University observed
due process requirements. Court of Appeals reversed and set aside the ruling of the NLRC.
ISSUE
Is there a just cause for Lacanaria’s termination and was he afforded due process.
HELD
Yes, there is just cause for his termination when he failed to display
professionalism and decency in dealing with his students. He consciously uttered words
tainted with mockery and insult with full knowledge that he was conversing with a
student whom he exercises authority over. It was not proper to speak to a student in such
a manner, especially in a classroom setting or even within the school grounds.
Furthermore, it is undisputed that Lacanaria has been warned in the past, verbally
and in writing, as regards his delivery of "green jokes'' in class. While the University was
not able to show that Lacanaria was specifically penalized for these previous infractions,
there is no denying that these instances formed part of his employee record. The totality
of an employee's infractions is considered and weighed in determining the imposable
sanction for the current infraction. Considering that Lacanaria committed a serious
misconduct, there is no impediment which bars the Court from taking into account his
previous offenses.
Those actuations demonstrated how Lacanaria’s misconduct amounted to

something grave and not merely trivial, considering his position as a professor. His
actuations clearly showed him unfit to continue working for the university, considering his
daily interaction with the students. He acted with wrongful intent and not mere error of
judgment since his statements were tainted with mockery and insult. He consciously
64
uttered those words with full knowledge that he was conversing with a student whom he
exercises authority over. Hence, he failed to display professionalism and decency in
dealing with his students.
Even though Lacanaria was not actually punished for his past infractions, the
penalty of dismissal imposed upon him is still valid, given the serious misconduct he
committed this time around. The University exercised its management prerogative in good
faith and without malice, with no blatant attempt to completely defeat Lacanaria's rights
as an employee, since it endeavored to substantially comply with the requirements of due
process.
However, the Court notes that Lacanaria's dismissal, although attended with just
cause, is marked with several procedural due process errors. To comply with procedural
due process and validly dismiss an employee, the employer is required to follow the
two-notice rule.
"First, an initial notice must be given to the employee, stating the specific
grounds or causes for the dismissal. It must direct the submission of a written
explanation answering the charges. Second, after considering the employee's
answer, an employer must give another notice providing the findings and reason
for termination."
The Charge Sheet did not inform Lacanaria of the date, time and place of the
hearing, even if the grievance procedure of the University requires it. Lacanaria did not
receive any formal written notice for the March 30, 2010 hearing; thus, he did not attend
the said session. As for the April 7, 2010 hearing, Lacanaria was again not able to attend
since he allegedly received the notice on the same day it was scheduled. Nonetheless, it
is settled that "actual hearing or conference” is not a condition sine qua non for
procedural due process in labor cases. It may be said that Lacanaria was given the
opportunity to be heard since he was able to file his Answer to Flores' Complaint as well
as a Motion for Reconsideration on the decision terminating him from employment.
As cited in Maula v. Ximex Delivery Express, Inc., “a formal hearing or conference

becomes mandatory only when requested by the employee in writing or substantial
evidentiary disputes exist or a company rule or practice requires it, or when similar
circumstances justify it.” After receipt of the Notice of Decision (or Termination),
Lacanaria filed a Motion for Reconsideration to ask for a reinvestigation (which is
equivalent to a request for a hearing) so that he can present his side, which the President
denied.
Furthermore, Lacanaria was not given any teaching load for the summer term of
SY 2009-2010, as well as the first semester of SY 2010-2011, these terms cover the
duration of the investigation. It appears that he was, in essence, preventively suspended
without the appropriate or required notice.
65
"Preventive suspension is not a penalty but a disciplinary measure to
protect life or property of the employer or the co-workers pending investigation of
any alleged infraction committed by the employee. Thus, it is justified only when
the employee's continued employment poses a serious and imminent threat to the
employers or coworkers' life or property. When justified, the preventively
suspended employee is not entitled to the payment of his salaries and benefits for
the period of suspension.”
It did not appear that Lacanaria's presence would pose a threat or danger to the
University, its personnel or its students, even if he entered the school's premises. Without
a doubt, such official action should have undergone due process standards. On this score,
too, Lacanaria was not afforded proper notice.
66
VILLOLA VS.
UNITED PHILIPPINE LINES, INC.
HERNANDO, J.
GR No. 230047 October 9, 2019
TERMINATION OF EMPLOYMENT; RESIGNATION; PRINCIPLE OF ESTOPPEL
DOCTRINE
Resignation is defined as a formal pronouncement or relinquishment of an office,
with the intention of relinquishing the office accompanied by the act of relinquishment.
The fact of resignation is therefore supported by the concurrence of the following: (1) the
intent to relinquish one's office; and (2) the overt act of relinquishment.
FACTS
The case stemmed from a complaint for illegal dismissal, underpayment of
salaries, non-payment of Service Incentive Leave (SIL) pay and separation pay, and claims
for moral and exemplary damages and attorney's fees filed by Mark Eliseus Villola
(Villola), complainant, against United Philippine Lines, Inc. (UPL), and its President,
Fernandino Lising (Lising), respondents.
In 2010, Villola was employed by UPL as its Information Technology (IT) and
Communications Manager. Villola alleged that he met with Lising to discuss proposed
adjustments to his salary as IT and Communications Manager to which Lising agreed to pay
him a monthly salary of P40,000 starting from April 1, 2010, but it was later changed to
P20,000 and an additional P15,000 per month. However, the additional P15,000 remained
unpaid. On May 31, 2013, Villola discussed with the officers of UPL the creation of a new
software system where the parties agreed that as soon as the system is implemented,
Villola will organize a business unit which will execute the encoding, scanning and
indexing of all UPL documents. Later on, Villola received an e-mail message from Mr. Joey
Consunji, General Manager of UPL, requiring Villola to submit a written resignation letter
indicating the effectivity date of his resignation. However, Villola did not comply and
continued reporting for work until July 2013. He sent e-mails to Lising demanding
payment of his unpaid salaries, allowances, and professional fees, but to no avail. In
October 2014, UPL released a Memorandum informing the employees’ of Villola’s
termination of employment.
On the other hand, UPL and Lising claimed that Villola was hired by UPL as IT
officer and that he was assigned as IT and Communications Manager almost a year after.
His duties included administration and implementation of the CORE program (CORE), but
UPL observed that Villola was unable to implement the CORE which caused UPL to engage
the services of HelpDesk. Meanwhile, Villola also engaged as trainer for a UPL affiliate
which detracted him from his core duties and responsibilities as IT and Communications
Manager of UPL, but UPL tolerated it. Sometime in May 2013, Consunji informed Villola
that management may have to declare his position redundant to which the latter agreed.
They also agreed that Villola will take on consultancy work for the scanning project
covering UPL documents, and instead of terminating Villola’s employment, he will simply
67
voluntarily cease his employment with the company, hence, Consunji instructed him to
formalize his resignation, but he failed to do so. Villola stopped reporting for work
beginning June 2013, but continued to render part-time work as trainer in the Anti-Piracy
Awareness Program of UPL Affiliate. Later on, Villola, under the name of “DRD Technology
Solutions”, submitted a proposal for the scanning project which never materialized.
The LA held that the acts of Villola indicated that he voluntarily resigned from his
position as IT and Communications Manager of UPL. On Appeal, the NLRC reversed the LA’s
decision and held that Villola’s resignation was not supported by evidence. UPL and Lising
filed a motion for reconsideration, but it was denied. Aggrieved, they filed a petition for
certiorari with the Court of Appeals which set aside the resolution of the NLRC and
concluded that Villola voluntarily resigned and was not dismissed from service.
ISSUE
Is the CA correct in reversing the finding of the NLRC and finding that Villola was
not illegally dismissed.
HELD
Yes, the CA was correct in holding that Villola was not illegally dismissed.
Resignation is defined as a formal pronouncement or relinquishment of an office, with the
intention of relinquishing the office accompanied by the act of relinquishment. The fact
of resignation is therefore supported by the concurrence of the following: (1) the intent
to relinquish one's office; and (2) the overt act of relinquishment. In illegal dismissal
cases, fundamental is the rule that when an employer interposes the defense of
resignation, on him necessarily rests the burden to prove that the employee indeed
voluntarily resigned.
In this case, the Court agrees with the respondents that Villola resigned from his
employment and that he was not dismissed by UPL based on the following factual
circumstances:
First, UPL, through Consunji, requested Villola to furnish to the

management his resignation letter and his proposal and quotation for its scanning
project. Notably, Villola did not raise any concerns whatsoever to Consunji or
inquired on the reasons for the latter's request to submit a resignation letter.
Second, it is also borne out of the records that UPL ceased paying his salaries after
May 31, 2013, as in fact, Villola himself already stopped reporting for work starting
June 1, 2013. Third, on June 27, 2013, Villola submitted to UPL his proposal for
the scanning project which was furnished to UPL under the name "DRD Technology
Solutions," an entity distinct from UPL.
In addition, the doctrine of estoppel applies in this case. Evidence on record would
reveal that Villola is estopped from asserting that he did not resign from employment on
account of his own acts and representations. Notably, Villola did not raise qualms about
his supposed resignation from UPL, much less his alleged dismissal from employment. It
was only three months after his resignation, which conveniently coincided with the time
68
when the scanning project did not materialize, that Villola started pursuing payment from
UPL of his monetary claims and questioning his cessation of employment therewith. Villola
cannot simply be relieved of the effects of his act of resigning from UPL, despite
substantial evidence that he has voluntary done so, simply because the scanning project
did not materialize. Thus, the CA ruling is affirmed.
69
LUFTHANSA TECHNIK PHILIPPINES, INC. VS. CUIZON
HERNANDO, J.
G.R. No. 184452 February 12, 2020
DISMISSAL ON THE GROUND OF LOSS OF TRUST AND CONFIDENCE; GROSS NEGLIGENCE
DOCTRINE
Article 297 (formerly 282) of the Labor Code provides that an employer may
terminate its employee for "fraud or willful breach by the employee of the trust reposed
in him by his employer or duly authorized representative."
The requisites for dismissal on the ground of loss of trust and confidence are: (1)
the employee concerned must be holding a position of trust and confidence; (2) there
must be an act that would justify the loss of trust and confidence; and (3) such loss of
trust relates to the employee's performance of duties.” Moreover, gross negligence implies
a want or absence of or a failure to exercise slight care or diligence, or the entire
absence of care.
In termination cases, the employer bears the burden of proving that the
employee's dismissal was for a valid and authorized cause. Consequently, the failure of
the employer to prove that the dismissal was valid, would mean that the dismissal was
unjustified, and thus illegal.
FACTS
Lufthansa Technik Philippines, Inc. (LTP), petitioner, is a corporation engaged in
the business of aircraft maintenance, repair and overhaul (MRO), and provides technical
support and MRO services to Philippine Airlines (PAL). Lorenzo Ziga (Ziga), officer of LTP,
Antonio Loquellano (Loquellano), MA2 Division Manager, and Arturo Bernal (Bernal), as
Duty Manager of the Maintenance Control Center of LTP, were also impleaded as
petitioners. Roberto Cuizon (Cuizon), respondent, initially worked with the Maintenance
and Engineering Department for PAL for 32 years. Eventually, LTP absorbed said
department and its employees, including Cuizon, who held the position of MA2 Duty
Manager in LTP’s Cebu Station from September 1, 2000 until his dismissal on August 16,
2005.
LTP claim that they validly terminated Cuizon’s employment on August 16, 2005
for loss of trust and confidence in his ability to perform his duties as MA2 Duty Manager
which resulted from his numerous violations and blatant disregard of the LTP Standards in
the Workplace committed in two separate incidents: 1) Cuizon’s willful concealment of
the accidental light up of a PAL Aircraft on March 10, 2005; and 2) Cuizon’s failure to
observe the safety guidelines and precautions of LTP with respect to aircraft towing,
causing another damage to a PAL Aircraft on April 15, 2005.
On the other hand, Cuizon asserts that LTP has no basis in terminating him, hence
it was illegal. He explains that prior to the foregoing incidents, an anonymous letter was
70
circulated criticizing Loquellano’s handling of the company in Cebu and his culpabilities
while Cuizon was being praised for his work ethic and named as the better person to hold
the position of MA-2 Manager, hence Loquellano suspected Cuizon as the sender of the
letter which resulted to Loquellano giving him a cold treatment. With regard to the
accidental light-up incident, Cuizon claims that he immediately informed Loquellano
through a phone call about his findings. He also asserts that he timely
submitted/furnished a copy of his incident report to Loquellano.
Cuizon received a Request for Explanation from Loquellano regarding the towing
incident on April 15, 2005. Cuizon submitted his response on June 1, 2005. He received
another request on June 9, 2005 for an accidental aircraft engine light-up where he was
charged with negligence on the job, false information, insubordination, and fraud. After
hearing on the matter, Cuizon was dismissed from service prompting him to file a
complaint for illegal dismissal.
The Labor Arbiter dismissed the complaint. On appeal, the National Labor
Relations Commission affirmed the disposition of the LA. Cuizon filed a motion for
reconsideration, but it was denied prompting him to file a petition for certiorari to the
Court of Appeals (CA). It reversed the findings of the LA and the NLRC, holding Cuizon was
illegally dismissed.
ISSUE
Is Cuizon validly terminated on the ground of loss of trust and confidence and gross
negligence.
HELD
No, Cuizon was not validly terminated for loss of trust and confidence. Article 297
(formerly 282) of the Labor Code provides that an employer may terminate its employee
for "fraud or willful breach by the employee of the trust reposed in him by his employer or
duly authorized representative."
"The requisites for dismissal on the ground of loss of trust and confidence are: (1)
must be an act that would justify the loss of trust and confidence; [and (3)] such loss of
trust relates to the employee's performance of duties.”
"Managerial employees refer to those whose primary duty consists of the

management of the establishment in which they are employed, or of a department or a
subdivision thereof, and to other officers or members of the managerial staff."
In the instant case, the Court finds that petitioners failed to substantially prove
the second requisite. In Cadavas v. Court of Appeals, the Court emphasized that “loss of
trust and confidence to be a valid cause for dismissal must be based on a willful breach of
trust and founded on clearly established facts. Such breach is willful if it is done
intentionally, knowingly, and purposely, without justifiable excuse as distinguished from
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an act done carelessly, thoughtlessly, heedlessly or inadvertently," However, in this case,
the Court is of the view that petitioners failed to prove that Cuizon willfully, intentionally,
knowingly, purposely, and without justifiable excuse disregarded LTP's rules and
regulations in the workplace.
On the contrary, the Court finds that Cuizon has substantially refuted petitioners'
claim on the alleged concealment of the accidental light-up and the towing incident. The
Court took note the following circumstances: (i) Cuizon had indeed immediately called
Loquellano to inform him about the accidental light-up and likewise timely
submitted/furnished him a copy of his incident report; (ii) the report submitted by Cuizon
was based on his personal findings and appreciation of facts of the accidental aircraft
engine light-up incident. The facts that he transmitted were the most precise information
that he could gather at that time; and (iii) Cuizon's claim had been substantially
corroborated and confirmed by the reports of his fellow employees involved in the
incident. The foregoing efforts of Cuizon showed that he followed the rules of procedure
of LTP and that there was no act of deliberately giving false, inaccurate, and misleading
information to petitioners.
Likewise, Cuizon is not liable for gross negligence. In Casco, as cited in Lima Land,
Inc. v. Cuevas, the court pronounced that:
Gross negligence implies a want or absence of or a failure to exercise slight
care or diligence, or the entire absence of care. It evinces a thoughtless disregard
of consequences without exerting any effort to avoid them. Habitual neglect
implies repeated failure to perform one's duties for a period of time, depending
upon the circumstances.
unjustified, and thus illegal. We find that petitioners failed to discharge the burden.
Firstly, petitioners miserably failed to show that Cuizon did not exercise even a
slight care or diligence which caused the grounding of and damage to the aircraft during
the towing operation. Moreover, petitioners failed to prove that it was Cuizon's act that
directly or solely caused the grounding of and damage to the aircraft during the towing
incident. Secondly, petitioners failed to prove that Cuizon was negligent in his job when
he allegedly concealed the accidental light-up incident or allegedly provided false
information thereon.
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Post-Employment
RELIEFS FROM ILLEGAL DISMISSAL
SAN MIGUEL CORP. VS. GOMEZ
HERNANDO, J.
G.R. No. 200815 August 24, 2020
ILLEGAL DISMISSAL; DISMISSAL ON THE GROUND OF LOSS OF TRUST AND CONFIDENCE
DOCTRINE
Article 297 [282] (c) of the Labor Code provides that an employer may terminate
the services of its employee for "fraud or willful breach x x x of the trust reposed in him
by his employer or duly authorized representative."
As a rule, employers have the discretion to manage its own affairs, which includes
the imposition of disciplinary measures on its employees. Nonetheless, employers may not
arbitrarily dismiss their employees by simply invoking Article 297 [282] (c). The loss of
confidence must be genuine and cannot be used as a "subterfuge for causes which are
improper, illegal or unjustified."
The requisites for dismissal on the ground of loss of trust and confidence are: "(1)
trust relates to the employee's performance of duties."
FACTS
San Miguel Corporation (SMC), complainant, employed Rosario Gomez ,
respondent, as a researcher in the Security Department and concurrently as Executive
Secretary to the Head of the Security Department. Gomez was assigned as coordinator in
the Mailing Department of SMC. SMC terminated Gomez’s services on the ground of fraud
or willful breach of trust, which also involved SMC’s arrangement with C2K Express, Inc.
(C2K).
C2K is a corporation engaged in courier and delivery services, which entered into
business with SMC sometime in January 2001 as the latter’s courier. The relationship
between C2K and SMC went smoothly until C2K encountered difficulty in collecting its
service fee from SMC. Eventually, it was found out that C2K’s former manager, Daniel
Tamayo, formed another courier services group, Starnec, which had been using fake C2K’s
receipts and collecting fees pertaining to C2K. The latter claimed that it was through
Gomez’s intervention that Tamayo’s group was able to transact business with SMC. SMC
conducted an investigation and requested C2K’s President, Edwin Figuracion, to execute
an affidavit narrating their claim where it was mentioned that Gomez had been collecting
25% commission from the total payment received by C2K, and an audit revealed that
Gomez was allegedly involved in the anomalies which caused losses to SMC.
73
SMC conducted an administrative investigation and hearing where Gomez
presented her defense. After such, Gomez was found guilty. SMC issued a notice of
termination of services to Gomez which prompted her to file a case for illegal dismissal
with the National Labor Relations Commission.
The Labor Arbiter dismissed the complaint holding that Gomez’s employment was
validly terminated. On appeal, the NLRC reversed the ruling. SMC filed a motion for
reconsideration, but it was denied by the NLRC prompting it to file a petition for
certiorari to the Court of Appeals. The CA upheld the ruling of the NLRC and pointed out
that Gomez’s dismissal on the ground of fraud and loss of trust and confidence was not
founded on clearly established facts.
ISSUE
Is Gomez’s termination from service valid, legal, and effective.
HELD
Yes, Gomez’s termination from service was valid, legal, and effective. Article 297
[282] (c) of the Labor Code provides that an employer may terminate the services of its
employee for "fraud or willful breach x x x of the trust reposed in him by his employer or
duly authorized representative." As a rule, employers have the discretion to manage its
own affairs, which includes the imposition of disciplinary measures on its employees.
Thus, "employers are generally given wide latitude in terminating the services of
employees who perform functions which by their nature require the employer's full trust
and confidence."
Nonetheless, employers may not arbitrarily dismiss their employees by simply

invoking Article 297 [282] (c). The loss of confidence must be genuine and cannot be used
as a "subterfuge for causes which are improper, illegal or unjustified." Thus, the requisites
for dismissal on the ground of loss of trust and confidence are: "(1) the employee
concerned must be holding a position of trust and confidence; (2) there must be an act
that would justify the loss of trust and confidence; [and (3)] such loss of trust relates to
the employee's performance of duties."
In the case at bar, the Court finds that Gomez indeed occupied a position of trust
and confidence, as defined by law and jurisprudence, since she was entrusted with SMC's
property, in particular its mail matter which included weighing and determining volumes
of documents to be shipped.
In addition, the Court finds that SMC likewise substantially proved the second requisite.
Gomez willfully, intentionally, knowingly, purposely, and without justifiable excuse
disregarded SMC's rules and regulations in the workplace. This Court notes that it was
through Gomez's intervention that Starnec (Tamayo's group) was able to transact business
with SMC, wherein Starnec used fake receipts and collected the fees pertaining to C2K.
74
Gomez, as the coordinator in SMC's Mailing Department, should have known or noticed
said fake receipts since she had previously transacted with C2K.
Moreover, the Court gives credence to the claim of C2K's President, Figuracion, in his
affidavit that Gomez had been collecting 25% commission from the total payment
received by C2K. This was corroborated by SMC's audit findings. Furthermore, SMC
conducted its investigation which resulted in Gomez being found guilty of committing
fraud against SMC and of receiving bribes through commissions in connection with the
performance of her function. In view of the foregoing, the Court finds that Gomez was
validly terminated on the ground of loss of trust and confidence.
In termination cases, the employer bears the burden of proving that the employee's
dismissal was for a valid and authorized cause. Consequently, the failure of the employer
to prove that the dismissal was valid, would mean that the dismissal was unjustified, and
thus illegal. We are of the firm view that SMC sufficiently discharged the burden.
75
COLEGIO SAN AGUSTIN-BACOLOD VS. MONTAÑO
HERNANDO, J.
GR No. 212333 March 28, 2022
DUE PROCESS; VALIDITY OF DISMISSAL; IMPROPER CONDUCT
DOCTRINE
Two requisites must be complied with to justify this ground for termination. First,
the employee must be holding a position of trust; and Second, the employer shall
sufficiently establish the employee's act that would justify loss of trust and confidence.
The act must be characterized as real wherein the facts that brought about the act were
clearly established, and that the employee committed the same without any justifiable
reason.
Labor Code allows an employer to preventively suspend an employee if continued

employment poses a serious and imminent threat to the life or property of the employer
or co-workers. In preventive suspension, the employer safeguards itself from further harm
or loss that may further be caused by the erring employee.
FACTS
Petitioner, CSA-Bacolod first employed respondent, Dr. Melinda M. Montaño as a
chemistry instructor in 1973. In 2003, she was appointed school registrar; her
appointment was renewed several times.
Respondent was terminated due to complaints from two faculty members alleging
that she allowed some students to attend the graduation ceremony despite not meeting
the requirements. Respondent averred that she merely continued the practice of previous
registrars and that she allowed these students to participate due to humanitarian reasons.
Respondent claimed that management did not consider her explanation and she
was instead served with a notice of charges on January 20, 2010. She responded to the
notice. She asserted that the basis of the notice was not really the letter complaints but
mere letters seeking for clarification of the school's policy regarding graduation. She also
questioned the jurisdiction of the Disciplinary Committee created by the president. The
matter should have been brought to the Vice President for Academic Affairs, and if not
resolved, it may be elevated to the Grievance Committee. 23 She refused to attend the
Disciplinary Committee meeting scheduled on January 26, 2010.
CSA-Bacolod posited that respondent's suspension and eventual dismissal was due
to gross misconduct resulting in loss of trust and confidence. Respondent had been
reminding the college deans that students with academic deficiencies should not be
allowed to participate in the graduation exercises. Two faculty members reacted to this
because they knew of certain students that were allowed by the respondent to participate
despite non-compliance with the requirements.
76
The LA ruled that respondent's preventive suspension was illegal; her act cannot
be construed as gross or serious misconduct. The NLRC reversed the LA decision and ruled
that respondent was validly dismissed for serious misconduct and breach of trust and
confidence reposed by the school in her. CA reversed the NLRC Decision and ruled that
respondent's act was indeed an act of misconduct; however, it was not serious enough to
warrant the penalty of dismissal.
ISSUE
Was Dr. Melinda Montano validly dismissed from service and was her preventive
suspension valid.
HELD
Yes, Dr. Montano was validly dismissed. The Supreme Court finds that the
respondent's act constitutes a breach of trust and confidence. There is loss of trust and
confidence when an employee fraudulently and willfully committed acts or omission in
breach of the trust reposed by the employer.
Two requisites must be complied with to justify this ground for termination. First,
the employee must be holding a position of trust; and second, the employer shall
sufficiently establish the employee's act that would justify loss of trust and confidence.
The act must be characterized as real wherein the facts that brought about the act were
clearly established, and that the employee committed the same without any justifiable
reason.
The respondent as school registrar occupied a position of trust. She is in possession

and custody of student records, which are vital for any educational institution. As to the
second requisite, the Court holds that respondent's act justifies loss of trust and
confidence. Respondent's conscious decision of allowing the ineligible students to march
shows her willfulness to transgress the established rule. This willful transgression of a rule
indeed results in the loss of the trust and confidence.
The Supreme Court adds that the length of time (30 years) respondent was
employed with CSA-Bacolod cannot outweigh the seriousness of the violation she has
committed, even if this is the first time she transgressed a rule. This is because once trust
and confidence are betrayed, it will be difficult to restore the smooth relationship that
had once been existing.
As to respondent's preventive suspension, the Court finds that CSA-Bacolod acted

well within its right in doing so. Labor Code allows an employer to preventively suspend
an employee if continued employment poses a serious and imminent threat to the life or
property of the employer or co-workers. In preventive suspension, the employer
safeguards itself from further harm or loss that may further be caused by the erring
employee. The respondent was school registrar, with her continued presence during the
investigation, it is not impossible that the school records under her custody may be
tampered; it is also not impossible that the investigation may be influenced given the
nature and ascendancy of her position. With the finding that respondent is validly
dismissed from employment, it follows that she is not entitled to backwages, separation
pay, moral and exemplary damages, and attorney's fees.
77
JR HAULING SERVICES VS. SOLAMO, ET. AL.
HERNANDO, J.
ILLEGAL DISMISSAL - SERIOUS MISCONDUCT AND LOSS OF TRUST AND CONFIDENCE
DOCTRINE
Loss of trust and confidence as a ground for dismissal of employees covers
employees occupying a position of trust who are proven to have breached the trust and
confidence reposed on them. Moreover, in order to constitute a just cause for dismissal,
the act complained of must be work related and shows that the employee concerned is
unfit to continue working for the employer. Loss of confidence as a just cause for
termination of employment is premised on the fact that the employee concerned holds a
position of responsibility, trust and confidence or that the employee concerned is
entrusted with confidence with respect to delicate matters, such as the handling or care
and protection of the property and assets of the employer. The betrayal of this trust is the
essence of the offense for which an employee is penalized.
For serious misconduct to justify dismissal under the law, "(a) it must be serious;
(b) must relate to the performance of the employee's duties; and (c) must show that the
employee has become unfit to continue working for the employer."
FACTS
Solamo et. al. claimed that JR Hauling dismissed them from employment without
notice and hearing and/or investigation, and without any valid reason when the
management allegedly displayed their pictures at the gate and barred them from entering
the company premises. Accordingly, Solamo, et. al. filed a complaint for illegal dismissal
and underpayment/non-payment of salaries/wages, 13th month pay, holiday pay, rest day
pay, Service Incentive Leave (SIL) pay, with prayer for reinstatement and payment of full
backwages and attorney's fees against petitioner JR Hauling Services and its manager,
Oscar Mapue (Mapue).
JR Hauling, in their response, averred that Solamo et. al, in the course of their
employment with them, incurred shortages in their deliveries of broilers amounting to
Three Hundred and Seventy One (371) pieces and Three Hundred and Seventy Seven (377)
pieces in February 2011 and March 2011, respectively. Upon further investigation, JR
Hauling discovered that Solamo et.al., without the knowledge or consent of JR Hauling,
were committing anomalous transactions involving the sale of excess broilers and crates
somewhere in Concepcion, Tarlac. Considering the foregoing circumstances, JR Hauling
insisted that Solamo et. al.’s transgressions amounted to serious misconduct, and
constituted fraud or willful breach of trust and confidence, which justified their dismissal
from employment.
The Labor Arbiter ruled that Solamo et. al. have been illegally dismissed and JR
Hauling and Mapue are held liable. On appeal, the NLRC reversed the Decision of the LA
78
and held that Solamo et. al.’s dismissal from employment was valid on the ground of loss
of trust and confidence. In a twist of events, the Court of Appeals (CA) ruled for Solamo
et. al. on further appeal. The CA held that JR Hauling failed to adduce substantial
evidence to establish the charge against respondents which served as basis for JR
Hauling's loss of trust and confidence that warranted their dismissal from employment.
Accordingly, the CA ordered respondents' reinstatement and payment of backwages.
ISSUE
Were Solamo et. al.’s acts amounted to serious misconduct, fraud or willful breach
of trust and confidence, or were tantamount to a commission of a crime, which justified
their dismissal from employment.
HELD
Yes, Solama et. al.’s act amounted to serious misconduct and willful breach of
trust and confidence.
The High Court has defined misconduct as the transgression of some established
and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and
implies wrongful intent and not mere error in judgment. For serious misconduct to justify
dismissal under the law, "(a) it must be serious; (b) must relate to the performance of the
employee's duties; and (c) must show that the employee has become unfit to continue
working for the employer."
In this regard, the Court explains that respondents' acts constitute Serious
Misconduct which would warrant the supreme penalty of dismissal. Notably, the facts of
the case reasonably establish with certainty: (1) that excess broilers and crates were
being illegally sold in Tarlac; and (2) that respondents were involved in the anomalous
transaction.
The unauthorized sale of excess broiler and broiler crates constitutes an act of
dishonesty, a breach of trust and confidence reposed by JR Hauling upon them.

unfit to continue working for the employer. In addition, loss of confidence as a just cause
for termination of employment is premised on the fact that the employee concerned
holds a position of responsibility, trust and confidence or that the employee concerned is
Solamo, et. al., as drivers/helpers were entrusted with the custody, delivery and
transportation of the broilers and broiler crates, including their proper handling and
79
protection, in accordance with the directives of JR Hauling and instructions of its clients.
To stress, Solamo, et. al. are performing the core business of JR Hauling. Thus, even on
the premise that they were not occupying managerial or supervisory positions, they were,
undoubtedly, holding positions of responsibility. As to their transgressions i.e., the
unauthorized sale of broilers and broiler crates, the same are clearly work-related as they
would not have been able to perpetrate the same were it not for their positions as
drivers/helpers of JR Hauling.
JR Hauling admitted that no written notice to explain and written notice of

termination were served upon Solamo et.al. JR Hauling did not specifically deny that it
dismissed Solamo, et. al. from employment without notice and hearing and/or
investigation when management allegedly displayed their pictures at the gate and barred
them from entering the company premises. In light of the foregoing, there being just
cause for the dismissal but considering JR Hauling’s non-compliance with the procedural
requisites in terminating Solamo et. al.’s employment, the latter are entitled to nominal
damages in the amount of P30,000.00 each in line with existing jurisprudence.
In determining an employee's entitlement to his monetary claims, the burden of

proof is shifted from the employer to the employee depending on the nature of the money
claim prayed for. In claims involving payment of salary differentials, this Court has held
that the burden rests on the employer to prove payment following the basic rule that "in
all illegal dismissal cases, the burden rests on the defendant to prove payment rather
than on the plaintiff to prove non-payment." This rationale is supported by the fact that
all pertinent personnel files, payrolls, records, remittances and other similar documents
which show that the salary differentials have in fact been paid are not in the possession
of the worker but are in the custody and control of the employer.
80
GESOLGON VS. CYBERONE PH., INC.
HERNANDO, J.
GR No. 210741 October 14, 2020
EMPLOYER-EMPLOYEE RELATIONSHIP; ILLEGAL DISMISSAL
DOCTRINE
The four-fold test used in determining the existence of employer-employee
relationship involves an inquiry into: (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 method by which the work is to be
accomplished.
In this case, there is no need for this Court to delve into the issues of their illegal
dismissal, their monetary claims and the probative value of the pay slips presented by
petitioners. Based on the foregoing, this Court is convinced that petitioners are not
employees of CyberOne PH, but stockholders thereof.
FACTS
Ma. Lea Jane Gesolgon and Marie Stephanie Santos alleged that they were hired on
March 3, 2008 and April 5, 2008, respectively, by Maciej Mikrut as part-time home-based
remote Customer Service Representatives of CyberOne Pty. Ltd. (CyberOne AU), an
Australian company. Thereafter, they became full time and permanent employees of
CyberOne AU and were eventually promoted as Supervisors. Sometime in October 2009,
Mikrut, the Chief Executive Officer of both CyberOne AU and CyberOne PH, asked
petitioners, together with Juson, to become dummy directors and/or incorporators of
CyberOne PH to which petitioners agreed.
Mikrut made Gesolgon and Santos choose one from three options: (a) to take an
indefinite furlough and be placed in a manpower pool to be recalled in case there is an
available position; (b) to stay with CyberOne AU but with an entry level position as
home-based Customer Service Representative; or (c) to tender their irrevocable
resignation. Gesolgon and Santos alleged that they were constrained to pick the first
option in order to save their jobs. In April 2011, they received their last salary.
Accordingly, they filed a complaint for illegal dismissal before the Labor Arbiter (LA).
CyberOne PH, Mikrut and Juson denied that any employer-employee relationship
existed between petitioners and CyberOne PH. They insisted that Gesolgona and Santos
were incorporators or directors and not regular employees of CyberOne PH. They claimed
that Gesolgon and Santos were employees of CyberOne AU and that the NLRC had no
jurisdiction over CyberOne AU because it is a foreign corporation not doing business in the
Philippines.
The LA held that Gesolgon and Santos are not employees of CyberOne PH as the
latter did not exercise control over them. On appeal, the NLRC ruled that Gesolgon and
81
Santos are employees of CyberOne AU and CyberOne PH. The NLRC concluded that
Gesolgon and Santos were dismissed without valid cause and due process. Dismayed by
the ruling of the NLRC, CyberOne PH elevated the case to the Court of Appeals where it
found favorable grounds. The appellate court reversed the findings of the NLRC and ruled
that no employer-employee relationship existed between Gesolgon and Santos, on one
hand, and respondent CyberOne PH, on the other hand.
ISSUE
Are Gesolgon and Santos employees of CyberOne PH and entitled to monetary
claims and the probative value of the pay slips presented by petitioners.
HELD
No, Gesolgon and Santos are not employees of CyberOne PH.
The four-fold test used in determining the existence of Employer-Employee

relationship involves an inquiry into: (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 method by which the work is to be
accomplished.
Based on record, Gesolgon and Santos were requested by respondent Mikrut to

become stockholders and directors of CyberOne PH with each one of them subscribing to
one share of stock. However, Gesolgon and Santos contend that they were hired as
employees of CyberOne PH as shown by the pay slips indicating that CyberOne PH paid
them P10,000.00 monthly net of mandatory deductions. Other than the pay slips
presented by them, no other evidence was submitted to prove their employment by
CyberOne PH. Gesolgon and Santos failed to present any evidence that they rendered
services to CyberOne PH as employees thereof.
As to the power of dismissal, the records reveal that Gesolgon and Santos
submitted letters of resignation as directors of CyberOne PH and not as employees
thereof. This fact negates their contention that they were dismissed by CyberOne PH as
its employees.
Lastly, the power of control of CyberOne PH over Gesolgon and Santos is not
supported by evidence on record. To reiterate, Gesolgon and Santos failed to prove the
manner by which CyberOne PH allegedly supervised and controlled their work. In fact,
they failed to mention their functions and duties as employees of CyberOne PH. They
merely relied on their allegations that they were hired and paid by CyberOne PH without
specifying the terms of their employment as well as the degree of control CyberOne PH
had over the means and method by which their work would be accomplished.
As it is established that Gesolgon and Santos are not employees of CyberOne PH,
there is no need for this Court to delve into the issues of their illegal dismissal, their
monetary claims and the probative value of the pay slips presented by petitioners. Based
on the foregoing, this Court is convinced that petitioners are not employees of CyberOne
PH, but stockholders thereof.
82
OMANFIL INTERNATIONAL MANPOWER DEVELOPMENT CORP. VS. MESINA
HERNANDO, J.
GR No. 217169 November 4, 2020
ILLEGAL DISMISSAL
DOCTRINE
For a dismissal on the ground of disease to be considered valid, two requisites
must concur: (a) the employee suffers from a disease which cannot be cured within six
months and his/her continued employment is prohibited by law or prejudicial to his/her
health or to the health of his/her co-employees, and (b) a certification to that effect
must be issued by a competent public health authority.
FACTS
Petitioner Omanfil International Manpower Development Corporation hired Rolando
Mesina (Mesina) for overseas work as an Expediter in Saudi Arabia. In his employment
contract, it is provided that “In the event of the employee being unable to discharge his
duties through accident or illness incurred while working on the project or projects,
medical treatment will be provided free by the employer. If the illness prolongs or is
found to be permanent, the employee will be returned to point of departure at the
employer's expense.”
After nine months since he started working, Mesina experienced chest pains. He
was confined at a local hospital and his severe chest pain was diagnosed as a heart
disease. A few days later, he was confined to the same hospital for his chest pains and he
was recommended to undergo further medical tests in a better-equipped hospital.
According to Omanfil, Mesina opted to come home to the Philippines since he felt
he could be treated better in his home country for his congenital heart ailment with his
family around. They likewise claimed that they gave Mesina an entry-reentry visa so that
he could return to them for work after his recovery. However, contrary to the foregoing,
Mesina claimed that he was immediately repatriated to the Philippines the next day,
against his will.
During the first week of his return in the Philippines, Mesina reported to Omanfil
and sought reimbursement for his medical expenses and for further expenses for the
operation and treatment of his illness in the total amount of P500,000.00 and submitted,
among others, a Philippine Heart Center's (PHC) quotation for operation materials in the
amount of P366,099.90, exclusive of doctors' fees and hospitalization charges. However,
Omanfil did not accede to his demands since pursuant to the employment contract, the
free medical treatment may only be availed of by Mesina during the period of his
employment. Moreover, Mesina's heart ailment could not have been work-related or
acquired during his short term employment of nine months, thus he is not entitled to free
extensive medical treatment, as contemplated in Item 8 of his employment contract.
83
Aggrieved by what he believed to be termination of his employment without any
legal justification, Mesina proceeded to file a case for illegal dismissal, refund of
hospitalization and medical expenses, damages and attorney's fees against petitioner.
The Labor Arbiter dismissed Mesina's claim for illegal dismissal but ordered
petitioners to pay him separation pay. However, the NLRC affirmed the findings of the
Labor Arbiter. Dismayed by the ruling of the NLRC, Mesina appealed the case further to
the Court of Appeals. The CA found that Omanfil illegally dismissed Mesina when his
contract was pre-terminated and he was repatriated back to the Philippines without any
just or authorized cause.
ISSUE
Is there valid termination of employment on the ground of a disease.
HELD
No, Mesina was illegally dismissed on the grounds of disease. For a dismissal on the
ground of disease to be considered valid, two requisites must concur: (a) the employee
suffers from a disease which cannot be cured within six months and his/her continued
employment is prohibited by law or prejudicial to his/her health or to the health of
his/her co-employees, and (b) a certification to that effect must be issued by a
competent public health authority.
In the instant case, petitioners did not comply with the foregoing requirements to
justify Mesina's termination on the ground of a disease. The Court noted that Omnafil’s
principal repatriated Mesina to the Philippines without any showing that he had a
prolonged and permanent disease. Furthermore, when Mesina was repatriated, none of his
medical records showed that his ailment was permanent or that he suffered from a
disease which could not be cured within six months and that his continued employment
was prohibited by law or prejudicial to his health or to the health of his co-employees.
This is validated by the absence of the required Certification from a competent public
authority certifying to such a health condition on his part.
Moreover, Mesina’s heart disease entitles him to the benefits stipulated in his
contract. The Supreme Court ruled that the very nature of petitioner's work as an
Expediter had contributed to the aggravation of his illness — if indeed it was pre-existing
at the time of his employment. In De Leon v. Maunlad Trans. Inc, the Supreme Court also
have held that it is not required that the employment be the sole factor in the growth,
development or acceleration of the illness to entitle the claimant to the benefits provided
therefor. It is enough that the employment had contributed, even to a small degree, to
the development of the disease.
Lastly, petitioners failed to substantiate their claim that Mesina voluntarily

returned to the Philippines for medical treatment. If the repatriation was indeed
voluntary on his part, he would not have pursued a case of illegal termination against
petitioners which would cost him time and money. As it is, Mesina's immediate filing of a
case of illegal dismissal negates petitioners' claim that he voluntarily agreed to his
84
repatriation to seek medical treatment in his home country. Likewise, petitioners failed to
establish the fact that they provided Mesina a re-entry visa to support their argument that
they did not dismiss him. In any case, even the existence of a re-entry visa does not
necessarily defeat an illegal dismissal complaint.
85
SPOUSES MAYNES VS. OREIRO
HERNANDO, J.
GR No. 206109 November 25, 2020
TERMINATION OF EMPLOYMENT BY EMPLOYER: JUST CAUSES
DOCTRINE
In termination cases, procedural due process consists of the twin requirements of
notice and hearing. The employer must furnish the employee with two (2) written notices
before the termination of employment can be effected: (1) the first apprises the
employee of the particular acts or omissions for which his dismissal is sought; and (2) the
second informs the employee of the employer's decision to dismiss him. The requirement
of a hearing is complied with as long as there was an opportunity to be heard, and not
necessarily that an actual hearing was conducted."
In the case at bar, the just cause for dismissal was duly established, but the
employee was not accorded her right to procedural due process. She was not given any
notice to explain or the opportunity to be heard before her dismissal. She only learned
about her dismissal from service when notices were posted in the premises of the outlet
stating that she is already terminated from her work. Thus, as correctly held by the CA,
she is entitled to an award of nominal damages in the amount of P30,000.00 in
accordance with recent jurisprudence.
FACTS
Sheila M. Monte, petitioner, was a Sales Clerk at respondent Marivin Oreiro's
(Oreiro) Boutique and Merchandise outlet in Bangar, La Union. She claimed that she was
summarily dismissed from employment without just cause and due process. Hence, she
filed a Complaint for illegal dismissal, underpayment of wages, non-payment of overtime
pay, 13th month pay and separation pay, as well as damages and attorney's fees.
Conversely, Oreiro denied illegally dismissing Monte. She contended that despite
Monte's infractions amounting to breach of trust and confidence, the latter was never
terminated from the service as in fact, Monte abandoned her work.
The Executive Labor Arbiter (ELA) declared that Monte was illegally dismissed. On
appeal to the NLRC, the latter denied Oreiro’s petition. Dismayed by the decision of the
NLRC, Oreiro elevated the case to the Court of Appeals. The CA ruled that Oreiro did not
change her theory on appeal and that the allegation of "loss of trust and confidence" as a
ground for Monte's termination was raised as an issue before the ELA. The CA held that
the NLRC is not precluded from receiving evidence on appeal as technical rules of
evidence are not binding in labor cases. Thus, even if the evidence was not submitted
before the ELA, due introduction of evidence before the NLRC should merit its admission
in keeping with fairness and equity.
86
In view of the foregoing, the CA ruled that there was just cause for Monte's
dismissal, i.e., loss of trust and confidence. The CA noted that Oreiro established by
substantial evidence that Monte committed the following infractions: 1) appropriated for
her personal use daily sales amounting to P6,025.00; 2) lost various stocks under her care;
and, 3) issued items to fictitious customers. Nonetheless, the CA found that Oreiro failed
to observe the twin requirements of notice and hearing in terminating Monte.
ISSUE
Is Monte dismissed for just cause.
HELD
Yes, Monte was dismissed for just cause, but was denied of her right to procedural
due process.
It is a settled rule that "[t]wo requisites must concur to constitute a valid dismissal
from employment: (1) the dismissal must be for any of the causes expressed in Article 282
(now Article 297) of the Labor Code; 44 and (2) the employee must be given an
opportunity to be heard and to defend himself."
Article 297 (c), which refers to "fraud or willful breach by the employee of the
trust reposed in [him/her] by [his/her] employer" or simply termed as "loss of trust and
confidence," is a just cause for dismissal. The requisites for dismissal on the ground of loss
of trust and confidence are: (1) the employee concerned must be holding a position of
trust and confidence; and (2) there must be an act that would justify the loss of trust and
confidence. In addition to these, such loss of trust relates to the employee's performance
of duties. Monte's position is clearly imbued with trust and confidence. She was tasked "to
perform overall supervision and control of the x x x outlet [including] receiving of
different items from the main office in Bacnotan; safekeeping and remittance of daily
sales, among others. She also did not deny the authenticity of her signature in the
Promissory Note wherein she acknowledged her misappropriation of cash sales.
Although there was just cause for her dismissal, Monte was denied procedural due
process. "In Distribution & Control Products, Inc. v. Santos, the Court has explained that
procedural due process consists of the twin requirements of notice and hearing. The
employer must furnish the employee with two (2) written notices before the termination
of employment can be effected: (1) the first apprises the employee of the particular acts
or omissions for which his dismissal is sought; and (2) the second informs the employee of
the employer's decision to dismiss him. The requirement of a hearing is complied with as
long as there was an opportunity to be heard, and not necessarily that an actual hearing
was conducted."
In the landmark case of Agabon v. National Labor Relations Commission, the Court
held that:
“Where the dismissal is for a just cause, as in the instant case, the lack of
statutory due process should not nullify the dismissal, or render it illegal or
87
ineffectual. However, the employer should indemnify the employee for the
violation of his statutory rights, as ruled in Reta v. National Labor Relations
Commission. The indemnity to be imposed should be stiffer to discourage the
abhorrent practice of "dismiss now, pay later," which we sought to deter in the
Serrano ruling. The sanction should be in the nature of indemnification or penalty
and should depend on the facts of each case, taking into special consideration the
gravity of the due process violation.”
In the case at bench, the just cause for the dismissal of Monte from the service
was duly established, i.e., loss of trust and confidence considering the several infractions
that she committed. At the same time, it was likewise established that Monte was not
accorded her right to procedural due process. She was not given any notice to explain or
the opportunity to be heard before her dismissal. She only learned about her dismissal
from service when notices were posted in the premises of the outlet stating that she is
already terminated from her work. Thus, as correctly held by the CA, she is entitled to an
award of nominal damages in the amount of P30,000.00 in accordance with recent
jurisprudence.
88
SANTOS, JR. VS. KING CHEF
HERNANDO, J.
GR No. 211073 November 25, 2020
ILLEGAL DISMISSAL; ABANDONMENT
DOCTRINE
In cases of illegal dismissal, the employer bears the burden to prove that the
termination was for a valid or authorized cause. But before the employer must bear the
burden of proving that the dismissal was legal, it is well-settled that the employees must
first establish by substantial evidence that indeed they were dismissed. If there is no
dismissal, then there can be no question as to the legality or illegality thereof.
Abandonment is a matter of intention and cannot lightly be presumed from certain

equivocal acts. The employer must prove that first, the employee "failed to report for
work for an unjustifiable reason," and second, the “overt acts showing the employee's
clear intention to sever their ties with their employer.”
FACTS
King Chef is a Chinese restaurant where Efren Santos, Jr. and Jeramil Salmasam,
petitioners, were employed as cooks. On December 25, 2011, Santos rendered only a half
day's work without prior authorization. Salmasan, on the other hand, did not report at all.
They claimed that in view thereof, they were dismissed from employment. They averred
that when they tried to report for work, their chief cook told them that they were already
terminated.
Accordingly, petitioners filed their complaint for illegal dismissal, underpayment of

salaries, non-payment of salaries and thirteenth month pay, damages, and attorney's fees
before the Labor Arbiter.
Respondents denied that petitioners were dismissed from work. They argued that
petitioners violated the December 22, 2011 memorandum informing the employees of
King Chef that no absences would be allowed on December 25, 26, 31 and January 1
unless justified. After petitioners failed to report for work on December 25, 2011, and
returned the following day merely to get their share in the accrued tips, they allegedly
went on absence without leave (AWOL) for the rest of the Christmas season.
The LA found petitioners to have been illegally dismissed. The Arbiter held that
the respondents failed to prove that petitioners indeed went on AWOL. When the case was
elevated to the National Labor Relations Commission, the said tribunal modified the
decision of the LA after finding that petitioners were unable to show that they were
dismissed in the first place. The labor tribunal found that aside from petitioners' bare
allegations, they did not present any proof to support their claim of termination. The
89
Court of Appeals (CA) affirmed the ruling of the NLRC and upheld its finding that there
was no dismissal in the first place.
ISSUE
Was Santos and Salmasam illegally dismissed.
HELD
No, Santos and Salamsam were not illegally dismissed.
There is no substantial evidence to establish that petitioners were in fact

dismissed from employment.
In cases of illegal dismissal, the employer bears the burden to prove that the
termination was for a valid or authorized cause. But before the employer must bear the
burden of proving that the dismissal was legal, it is well-settled that the employees must
first establish by substantial evidence that indeed they were dismissed. If there is no
dismissal, then there can be no question as to the legality or illegality thereof.
Petitioners merely alleged that they were terminated by their chief cook and were
barred from entering the restaurant, without offering any evidence to prove the same.
They failed to provide any document, notice of termination or even any letter or
correspondence regarding their termination. Aside from their bare allegations, they did
not present any proof which would at least indicate that they were in fact dismissed.
On the contrary, the evidence on record points to the fact that after petitioners
failed to report on December 25, 2011, and after they went back to their workplace
merely to get their share in the tips the following day, they refused to return to work and
continued to be on AWOL thereafter.
Without substantial evidence that petitioners were indeed dismissed, it is futile to

determine the legality or illegality of their supposed dismissal. We are thus constrained to
uphold the NLRC's ruling, as affirmed by the CA, that there was no illegal dismissal in this
case.
Respondents are not correct in arguing that there was abandonment on the part of
the petitioners. "Abandonment is a matter of intention and cannot lightly be presumed
from certain equivocal acts." The employer must prove that first, the employee "failed to
report for work for an unjustifiable reason," and second, the "overt acts showing the
employee's clear intention to sever their ties with their employer."
There was no showing here that petitioners' absences were due to unjustifiable
reason, or that petitioners clearly intended to terminate their employment. It does not
suffice that petitioners pre-empted respondents by filing the complaint for illegal
dismissal before respondents can impose disciplinary action. "The operative act is still the
employees' ultimate act of putting an end to their employment."
90
ANGONO MEDICS HOSPITAL, INC. VS. AGABIN
HERNANDO, J.
GR No. 202542 December 9, 2020
ILLEGAL DISMISSAL; SEPARATION PAY AND BACKWAGES
DOCTRINE
It is settled that "the twin reliefs that should be given to an illegally dismissed
employee are full backwages and reinstatement. Backwages restore the lost income of an
employee and is computed from the time compensation was withheld up to actual
reinstatement. Anent reinstatement, only when it is not viable is separation pay given."
FACTS
Antonina Agabin, respondent, was hired by Angono Medics Hospital, Inc. (AMHI),
petitioner, as a staff midwife. While working, she was allowed by Andres Villamayor, the
former President of AMHI, and Antoinette E. Antiojo, the Chief Nurse, to study nursing
simultaneously. Agabin requested permission to go on leave without pay from June 29,
2007 to September 15, 2007 as she needed to work as an affiliate in Mariveles, Bataan as
part of her school requirement. Antiojo approved the request on the same day.
On September 15, 2007, Agabin returned to AMHI to inform Antiojo that she was
ready to report back to work. Antiojo added Agabin to the Schedule of Duty for the period
September 16 to 30, 2007. However, Agabin was berated by Villamayor and told her to go
home and take a vacation since she has been away for a long time. Villamayor also told
Agabin that she would not be compensated for her work rendered on September 17 and
18, 2007. The next day, Antiojo informed Agabin that as per Villamayor's instructions,
Agabin should not report for work anymore. Thus, Agabin filed a Complaint for illegal
dismissal, separation pay, backwages and other monetary claims.
AMHI denied dismissing Agabin. It claimed that the latter simply failed to report
for work after June 28, 2007 for unspecified reasons.
The Labor Arbiter found that Agabin was illegally dismissed from her job.
Moreover, Agabin's leave of absence was with the prior approval of Antiojo as supported
by an approved leave form. On appeal, the National Labor Relations Commission affirmed
the ruling of the Arbiter. However, considering Agabin's refusal to AMHI's offer for
reinstatement during the January 16, 2008 hearing, the computation of her separation
pay and backwages should be modified in that it should be limited for the period
September 19, 2007 until January 16, 2008 while her separation pay should be computed
from September 1, 2002 up to January 16, 2008.
With Agabin and Villamayor dismayed with the decision of the NLRC, they both
appealed the case to the Court of Appeals. Unfortunately, the two cases were not
consolidated by the CA. The CA dismissed AMHI's Petition and held that the NLRC's factual
findings and conclusions are supported by substantial evidence.
91
Meanwhile, in Agabin’s petition, the CA reinstated the decision of the LA. The
appellate court found that AMHI's offer of reinstatement was not supported by evidence
and thus should not have been automatically factored in by the NLRC as a basis for
modifying the reckoning point of the award of separation pay and backwages. Moreover,
in cases where reinstatement is no longer feasible, separation pay and backwages must be
computed up to the finality of the decision. In addition, until actual receipt by the
employee of the award of separation pay, the employer-employee relationship subsists
and entitles the illegally dismissed employee to an award of backwages, 13th month pay,
and other benefits from the time of his or her actual dismissal until finality of the
decision of the Labor Arbiter.
ISSUE
Was Agabin illegally dismissed and if so, what should be the basis of computing her
monetary claims.
HELD
Yes, Agabin was illegally dismissed and that the same has already become final
and executory.
In AHMI’s petition, while the appellate court affirmed both the rulings of the
Arbiter and the NLRC as regards the issue of Agabin's illegal dismissal, it did not delve into
the computation of separation pay and backwages. In this regard, it cannot be said that
there was a bar by conclusiveness of judgment by virtue of the finality of the said petition
which would in turn bar Agabin from further contesting the computation of her monetary
awards. The issue of Agabin's illegal dismissal has already been settled as confirmed by
the decision in both AHMI’s and Agabin’s petitions.
The case of Bani Rural Bank, Inc. v. De Guzman extensively explained the basis for
the computation of the monetary awards, as follows:
“First, when reinstatement is ordered, the general concept under

Article 279 of the Labor Code, as amended, computes the back wages
from the time of dismissal until the employee's reinstatement. The
computation of backwages (and similar benefits considered part of the
backwages) can even continue beyond the decision of the labor arbiter or
NLRC and ends only when the employee is actually reinstated.
Second, when separation pay is ordered in lieu of reinstatement

(in the event that this aspect of the case is disputed) or reinstatement is
waived by the employee (in the event that the payment of separation pay,
in lieu, is not disputed), backwages is computed from the time of
dismissal until the finality of the decision ordering separation pay.
Third, when separation pay is ordered after the finality of the

decision ordering the reinstatement by reason of a supervening event that
92
makes the award of reinstatement no longer possible (as in the case),
backwages is computed from the time of dismissal until the finality of the
decision ordering separation pay.”
The second scenario squarely applies in the case at bar since the order of
separation pay was decreed in lieu of reinstatement. Hence, the employer-employee
relationship of AMHI and Agabin will only be completely terminated upon the finality of
the decision which ordered the payment of separation pay and backwages.
It follows that the computation of Agabin's backwages must be from the time of
her illegal dismissal from employment on September 19, 2007 until the finality of the
decision ordering the payment thereof. As for her separation pay, it should be computed
at one month pay for every year of service reckoned from September 2, 2002 (as found by
the Arbiter) until the finality of the decision in her favor.
93
LAMADRID VS.
CATHAY PACIFIC AIRWAYS LIMITED
HERNANDO, J.
G.R. No. 200658 June 23, 2021
TERMINATION OF EMPLOYMENT BY THE EMPLOYER
DOCTRINE
erring employee.
FACTS
In 1990, Cathay hired Salvacion A. Lamadrid as a cabin crew. Prior to her
termination in 2007, Lamadrid had rendered about 17 years of service in Cathay, and held
the position of Senior Purser.
Donald Lal, Airport Services Officer of Cathay in Sydney Airport, received a report
from Customer Officer Mary Greiss that some crew members of Cathay flight CX 139,
including Lamadrid, were caught in possession of goods after alighting from the aircraft.
Mary handed to Lal a plastic bag containing a 1.5 liter Evian water bottle and a pile of
magazines confiscated from Lamadrid as well as the photocopy of the latter's passport.
Cathay requested Lamadrid to submit a written explanation regarding the incident

to show cause why no disciplinary action should be imposed against her since removal of
company property without authorization is considered a serious misconduct.
On May 28, 2007, Lamadrid submitted her reply-letter denying the allegations
against her. She claimed that the Hello magazine; and the Evian water, which was
confiscated from her, was not Cathay's property. As regards the other items, she claimed
that another cabin crew already admitted having taken those items.
She denied having committed serious misconduct, and demanded that the items
taken from her be preserved following a fair and transparent investigation.
Thereafter, Cathay informed Lamadrid of the termination of her services effective

immediately for committing serious misconduct by removing company property without
authorization. According to Cathay, it could no longer repose its trust and confidence on
the petitioner considering the seriousness of her violation.
Hence, Lamadrid instituted a complaint for illegal dismissal and money claims
against Cathay and Lo. Lamadrid insisted that her termination was without just cause
because she bought the Evian water from Hong Kong. On the other hand, Cathay and Lo
initially asserted that the Labor Arbiter had no jurisdiction to hear the dispute since the
incident occurred in a foreign jurisdiction involving foreign nationals. Also, they
94
maintained that Lamadrid had no cause of action against them because they complied
with the requirements of substantive and procedural due process in labor cases.
The LA rendered judgment declaring Cathay Pacific Airways limited guilty of illegal
dismissal. The NLRC ruled that respondents were guilty of illegal dismissal and ordered to
immediately reinstate complainant Salvacion Lamadrid to her former position without loss
of seniority rights within ten (10) days from receipt.
ISSUE
Was Lamadrid illegally dismissed.
HELD
Yes, Lamadrid was illegally dismissed. Moreover, Lamadrid's termination was not
commensurate with the infraction committed.
Employees can be terminated only for just or authorized cause. Article 297 [282]
of the Labor Code enumerates the just causes for dismissal, to wit:
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 representatives; and
(e) Other causes analogous to the foregoing.
There is loss of trust and confidence when an employee fraudulently and willfully
committed acts or omission in breach of the trust reposed in her/him by the employer.
Two requisites must be complied with to justify this ground for termination. First, the
employee must be holding a position of trust, and second, the employer shall sufficiently
establish the employee's act that would justify loss of trust and confidence. The act must
be characterized as real wherein the facts that brought about such act were clearly
established, and that the employee committed the same without any justifiable reason.
Cathay has complied with the two aforementioned requisites for loss of trust and
confidence. The Court has already settled that Lamadrid's position was imbued with trust
and confidence. Likewise, the airline clearly demonstrated that she committed an
infraction of company policy that breached its trust and confidence in her.
Lamadrid's infraction was clearly a case of misconduct considering that it is "a

transgression of some established and definite rule of action, a forbidden act, a
95
dereliction of duty, willful in character, and implies wrongful intent and not mere error in
judgment." It evidently eroded Cathay's trust and confidence in her.
However, while the weight of evidence points to Lamadrid's infraction of company

policy, the Court should also consider that this is Lamadrid's first infraction in her 17 years
of service in the airline which involved a mere bottle of water. Concededly, the company
laid down the penalties for violation of its policies; however, the evaluation of an
employee's infraction should be dealt with fairness and reason. Simply put, all surrounding
circumstances must be considered and the penalty must be commensurate to the violation
committed by an employee. Termination of the services of an employee should be the
employer's last resort especially when other disciplinary actions may be imposed,
considering the employee's long years of service in the company, devoting time, effort and
invaluable service in line with the employer's goals and mission, as in Lamadrid's case.
During Lamadrid's span of employment, she did not commit any infraction or was
ever sanctioned except in the incident subject of the present controversy. To impose a
penalty as grave as dismissal for a first offense and considering the value of the property
allegedly taken would be too harsh under the circumstances. Therefore, Lamadrid was
illegally dismissed from service.
As consequences of Lamadrid's illegal dismissal, she is entitled to the payment of

full backwages and separation pay in lieu of reinstatement since the latter is no longer
feasible considering the time that has lapsed and the strained relations between the
parties.
96
PACIFIC ROYAL BASIC FOODS, INC. VS. NOCHE
HERNANDO, J.
G.R. No. 202392 October 4, 2021
DOCTRINE
Trust is fundamental in every employer-employee relationship. Not all employees,
however, are dismissible on the basis of loss of trust and confidence. Only managerial
employees and fiduciary rank-and-file employees may be terminated from work on such
ground.
FACTS
Petitioner Pacific Royal Basic Foods, Inc. (PRBFI) is a business entity engaged in the
manufacturing, processing, and distribution of coconut products for export. PRBFI
employed respondents as coconut parers.
Respondents filed a complaint for non-regularization with the Department of Labor

and Employment (DOLE), Quezon Field Office. They anchored their complaint for
non-regularization on PRBFI's supposed failure to regularize their employment despite the
length of time that they had been working for PRBFI.
On March 20, 2009, allegedly acting on product quality complaints and claims for
reimbursement and damages from some of its clients, PRBFI sent letters signed by one
R.V. Macaraig, PRBFI's Production Manager, to respondents asking them to explain their
involvement on the recent contamination in their production and show cause why they
should not be disciplined.
Respondents denied involvement in the product contamination incident.

Thereafter, PRBFI dismissed respondents from work. Respondents filed a complaint
against PRBFI for illegal dismissal, illegal suspension, regularization, damages, and
reinstatement before the National Labor Relations Commission, Regional Arbitration
Branch IV. In their Position Paper, respondents averred that they were dismissed from
work without a prior investigation or an opportunity to air their side. Respondents claimed
that their suspension and eventual dismissal from work was PRBFI's retaliatory measure
against respondents' complaint for non-regularization.
Respondents also raised the lack of basis of their dismissal due to loss of trust and
confidence, as this ground refers to managerial and confidential employees and
respondents were only rank-and-file workers of PRBFI. They were also allegedly never
paid the benefits extended to regular employees despite their entitlement thereto.
Respondents sought reinstatement to their former positions in PRBFI with full backwages
and without loss of seniority rights, and payment of the benefits enjoyed by regular
employees. However, PRBFI maintained that respondents were properly and correctly
97
dismissed from employment. PRBFI maintained that letters were sent to the suspected
employees to explain their involvement in the incident.
In finding respondents to have been illegally dismissed, the Labor Arbiter held that
PRBFI had no just cause for their dismissal. PRBFI showed no factual bases for or specific
circumstances of the infractions allegedly committed by respondents. The NLRC reversed
the Labor Arbiter. Later on, the Court of Appeals granted respondents' Petition for
Certiorari. It found that PRBFI did not present any proof of compliance as to the required
posting of an appeal bond. Thus, PRBFI's appeal before the NLRC should have been
deemed not perfected, and the NLRC did not acquire jurisdiction over PRBFI's appeal. The
assailed May 29, 2009 Resolution of the National Labor Relations Commission was reversed
and the April 28, 2008 Decision of the Labor Arbiter was affirmed.
ISSUE
Is loss of trust and confidence as a ground to dismiss an employee applicable to
respondents.
HELD
No, loss of trust and confidence as a ground to dismiss an employee is inapplicable
to herein respondents.
Following Wesleyan University Philippines v. Reyes, two requisites must concur for
a valid termination of employment due to loss of trust and confidence:
The first requisite is that the employee concerned must be one holding a
position of trust and confidence, thus, one who is either: (1) a managerial
employee; or (2) a fiduciary rank-and-file employee, who, in the normal exercise
of his or her functions, regularly handles significant amounts of money or property
of the employer. The second requisite is that the loss of confidence must be based
on a willful breach of trust and founded on clearly established facts.
Petitioner claims that respondents are dismissible for loss of trust and confidence
since the latter's acts were inimical to the former's interest as a company engaged in the
delicate nature of food export industry. This attempt to squeeze respondents into the
mold of managerial and fiduciary rank-and-file employees must fail.
M + W Zander Philippines, Inc. v. Enriquez differentiates managerial and fiduciary

rank-and-file employees within the purview of dismissals due to loss of trust and
confidence, as follows:
There are two classes of positions of trust: managerial employees and

fiduciary rank-and-file employees.
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Managerial employees are defined as those vested with the powers or
prerogatives to lay down management policies and to hire, transfer, suspend,
lay-off, recall, discharge, assign or discipline employees or effectively
recommend such managerial actions. They refer to those whose primary duty
consists of the management of the establishment in which they are employed
or of a department or a subdivision thereof, and to other officers or members
of the managerial staff. Officers and members of the managerial staff perform
work directly related to management policies of their employer and
customarily and regularly exercise discretion and independent judgment.
The second class or fiduciary rank-and-file employees consist of

cashiers, auditors, property custodians, etc., or those who, in the normal
exercise of their functions, regularly handle significant amounts of money or
property. These employees, though rank-and-file, are routinely charged with
the care and custody of the employer's money or property, and are thus
classified as occupying positions of trust and confidence.
Respondents' positions as coconut parers are essential in PRBFI's business of

coconut products, but in no case do they fit the job description of managerial employees
and fiduciary rank-and-file employees. Manual work such as paring coconuts for
commercial production is a task that does not entail being routinely entrusted with the
care and custody of money and property belonging to the company like fiduciary
rank-and-file employees. Much less can coconut parers be considered to be directly
involved in the management and policy-making of their employer as managerial
employees.
Indeed, trust is fundamental in every employer-employee relationship. Not all

employees, however, are dismissible on the basis of loss of trust and confidence. Only
managerial employees and fiduciary rank-and-file employees may be terminated from
work on such ground. If PRBFI's theory would be sustained, then all employees shall be
inequitably deemed as holding positions of fiduciary nature. Respondents having occupied
ordinary rank-and-file posts with petitioners, their dismissal on the ground of loss of trust
and confidence is illegal.
99
BELARSO VS. QUALITY HOUSE, INC.
HERNANDO, J.
G.R. No. 209983 November 10, 2021
DOCTRINE
Jurisprudence provides for two conditions before an employee may be dismissed
for fraud or willful breach by the employee of the trust reposed in him by his employer or
duly authorized representative, under Article 297 of the Labor Code:
First. Breach of trust and confidence must be premised on the fact that
the employee concerned holds a position of trust and confidence, where
greater trust is placed by management and from whom greater fidelity to duty
is correspondingly expected. The essence of the offense for which an employee
is penalized is the betrayal of such trust.
Second. There must be some basis for the loss of trust and confidence.
The employer must present clear and convincing proof of an actual breach of
duty committed by the employee by establishing the facts and incidents upon
which the loss of confidence in the employee may fairly be made to rest. This
means that "the employer must establish the existence of an act justifying the
loss of trust and confidence." Otherwise, employees will be left at the mercy of
their employers.
FACTS
Private respondent Quality House, Inc. (QHI) is a manufacturer and distributor of
leather products, such as belts, wallets and other small leather items. On November 14,
1976, it hired petitioner Evelina E. Belarso. She was later on promoted as supervisor of
the Raw Materials Warehouse. As supervisor, she was tasked to receive and keep the raw
materials for storage. She was also in-charge of releasing them to the different
departments of QHI upon request.
Before leaving the warehouse, Belarso submitted herself to the routinary outgoing
inspection and body frisking of employees at the QHI gate where Lady Guard (L/G) Lolita
Salamanca found a belt buckle inside the bag. She called Belarso's attention but the latter
had no gate pass or authorization to bring out the said item from the warehouse. Belarso
denied any knowledge on why and how the belt buckle got inside her bag. Thereafter, an
incident report was immediately filed.
Belarso received a notice from QHI placing her under preventive suspension and
requiring her to submit a written explanation within 48 hours from receipt of the notice
why she should not be subjected to disciplinary action in connection with the December
10, 2010 incident report. On December 15, 2010, [Belarso] submitted her written
explanation denying all the accusations against her. She claimed that her bag was placed
100
outside her work station under a table located beside the door and near the window. The
bag was visible to everyone. She stressed that in her 34-years of service in the company
she was fully aware of QHI's policy of inspecting its employees, their bags and other
belongings before leaving the company premises, so why would she place a belt buckle
inside her bag without even wrapping or concealing it.
She requested management for a dialogue with Ms. Carmelita Go to personally

explain her side. QHI acceded. Hence, on January 4, 2011, a conference was held. At the
said conference, no plausible explanation was given by Belarso other than that she was
framed-up by her co-employees by putting the belt buckle inside her bag without her
knowledge. Before the result of the investigation was even released, a complaint for
illegal dismissal against QHI was already filed by Belarso. In her complaint, [Belarso
indicated that she was illegally dismissed by QHI on December 13, 2010.
For its part, private respondent QHI, claimed that Belarso was terminated from
employment for cause. It asserted that Belarso had violated company rules and policies by
stealing a belt buckle and by bringing her bag to the work station when the same was not
allowed by the company. Belarso also failed to give a valid explanation why the belt
buckle was in her possession.
The Labor Arbiter ruled that Belarso had been illegally dismissed by QHI. The
National Labor Relations Commission reversed the ruling of the LA after finding that QHI,
through its evidence, was able to establish that Belarso's dismissal was for a just cause,
i.e., loss of trust and confidence. In the assailed Decision, the Court of Appeals sustained
the NLRC's findings and agreed that the evidence on record supports QHI's position.
ISSUE
1. Is there a just cause to terminate the petitioner from her employment.
2. Granting arguendo that the petitioner violated the company's rules and
regulations, is the penalty of dismissal is proper and warranted by the circumstances.
HELD
1. Yes, the just cause for termination of the petitioner from her employment was
grounded on violating company rules and loss of trust and confidence as stated in Rule.
Loss or breach of trust and confidence, as a just cause for termination by an employer, is
based on Article 297 of the Labor Code:
ARTICLE 297. [282] Termination by Employer. — An employer may terminate an
employment for any of the following causes:
(c) Fraud or willful breach by the employee of the trust reposed in him
by his employer or duly authorized representative. Jurisprudence provides for
two conditions before an employee may be dismissed for such cause:
First. Breach of trust and confidence must be premised on the fact that
the employee concerned holds a position of trust and confidence, where
greater trust is placed by management and from whom greater fidelity to duty
101
is correspondingly expected. Second. There must be some basis for the loss of
After a careful review of the records, the Court found that the above conditions
were present. First, Belarso never denied in her Petition that she held a position of trust
and confidence. Her appointment letter showed that she assumed the position of Raw
Materials Supervisor in 1987. As a supervisor, she was responsible for the custody,
handling, safekeeping, and releasing of QHI's raw materials. This brings her within the
scope of employees vested with trust and confidence, i.e. , those who in the normal and
routine exercise of their functions regularly handle significant amounts of money or
property.
Second, QHI was able to establish the basis of its loss of trust on Belarso: her
violation of the company rule prohibiting the stealing or attempting to steal company
property. Contrary to Belarso's claim and the LA's ruling that QHI was unable to establish
such, the evidence on record reflects otherwise.
2. YES. The penalty of dismissal is proper. Belarso finally argues that the penalty is
too harsh considering her years of service in the company. However, length of service is
not a bargaining chip that can simply be stacked against the employer. Under the present
circumstances, length of service only aggravates Belarso's offense. First, she held a
position of trust and confidence, overseeing the custody of the raw materials she tried to
steal. As a supervisor, greater trust was placed on her by QHI. Second, her infraction
affected the very essence of loyalty and honesty which all employees owe to their
employers. It was serious, grave, and reflected adversely on her character.
The Court found Belarso's dismissal for loss of trust and confidence valid. Indeed,
“while the State can regulate the right of an employer to select and discharge his or her
employees, an employer cannot be compelled to continue the employment of an
employee in whom there has been a legitimate loss of trust and confidence."
102
SYSTEMS AND PLAN INTEGRATOR AND DEVELOPMENT CORP. VS. BALLESTEROS
HERNANDO, J.
G.R. No. 217119 April 25, 2022
TERMINATION OF EMPLOYMENT
DOCTRINE
The burden of proving that the termination of an employee was for a just or
authorized cause lies with the employer. If the employer fails to meet this burden, the
dismissal is unjustified, thus, illegal. To discharge this burden, the employer must present
substantial evidence, or the amount of relevant evidence which a reasonable mind might
accept as adequate to justify a conclusion, and not based on mere surmises or
conjectures.
FACTS
Michelle Ballesteros, complainant filed a Complaint for illegal dismissal,
non-payment of wages, service incentive leave pay, 13th month pay, damages, and
attorney's fees against Systems and Plan Integrator and Development Corp (SPID Corp.)
Ballesteros started working for SPID Corp. as a Customer Service Representative and she
was eventually promoted to administrative staff. During the first week of February 2011,
Kristine Castro, Personnel Officer of SPID Corp., talked to her and told that she was asking
for her resignation because she was pregnant, and was going to have two children to take
care of. Ballesteros talked to Ronniel Cunanan, SPID Corp.'s Administration and Finance
Officer, who confirmed that the company is indeed asking Ballesteros to tender her
resignation, saying that although she did not have a bad record that would justify her
termination, the company decided to terminate her for the same reasons. On March 25,
2011, Ballesteros gave birth and availed of maternity leave.
Sometime in April 2011, Ballesteros went back to the office and told Castro that
she did not want to resign. While still on maternity leave, Ballesteros discovered that her
salary for the period of May 15 to 31, 2011 was not deposited to her account even if her
maternity leave was until June 21, 2011. Alarmed, she contacted Castro and found out
that the company withheld her salary and would only be released if Ballesteros would
process her SSS maternity benefits and tender her resignation letter. Still, Ballesteros
refused to resign. On June 5, 2011, Ballesteros received a letter from the company
informing her of her termination from the service.
On the other hand, SPID Corp., alleged that Ballesteros' employment was
terminated based on her incompetence and inefficiency in the performance of duties.
Also, SPID Corp. lost its confidence and trust in Ballesteros because of her continued
neglect of duty and habitual absences and tardiness. Also, SPID Corp. alleged that
Ballesteros refused to receive the February 21, 2011 memorandum, but instead requested
to talk with Cunanan to plea for leniency considering her impending delivery. The
memorandum was not a notice of termination, but a notice to explain in writing why
Ballesteros should not be terminated. SPID Corp. further alleged that Ballesteros offered
103
to resign after she gave birth as a graceful exit from the company, and requested to be
given a certificate of employment to find a new job.
The LA dismissed the complaint for lack of merit. On appeal, the National Labor
Relations Commission (NLRC) reversed the LA's ruling and ordered SPID to reinstate
Ballesteros to her former position without the loss of seniority rights and to pay her
backwages and other benefit. SPID Corp.'s motion for reconsideration was denied. The
case was elevated to the CA and dismissed the SPID Corp.'s case for lack of merit. Hence,
this Petition for Review on certiorari.
ISSUE
Was Ballesteros validly terminated from employment.
HELD
No, Ballesteros was not validly terminated from employment. For a dismissal from
employment to be valid, it must be pursuant to either a just, or an authorized cause,
under Articles 297, 298, or 299 of the Labor Code. In the case at bar, SPID Corp. dismissed
Ballesteros based on three just causes: (a) habitual leaves of absence or gross habitual
neglect of duty; (b) open and willful disobedience; and (c) money shortage, thus, loss of
The rudimentary requirements of due process require that an employer dismissing

an employee must furnish the latter with two written notices before the termination of
employment can be effected: (1) the first notice apprises the employee of the particular
acts or omissions for which the dismissal is sought; and (2) the second notice informs the
employee of the employer's decision to dismiss him or her. Failure to observe or to prove
compliance of the same would still make the dismissal valid, as long as a just or
authorized cause for dismissal exists, with the employer, however, being held liable for
nominal damages. Here, SPID Corp. failed to substantiate Ballesteros' habitual tardiness
and undertime as the generated print-outs presented to the NLRC were mere photocopies
and unauthenticated. Also, it failed to present substantial evidence to prove that
Ballesteros, indeed, was habitually absent, thus, neglected her duty.
For willful disobedience to be a valid cause for dismissal, these two elements must
concur: (1) the employee's assailed conduct must have been willful or intentional, the
willfulness being characterized by "a wrongful and perverse attitude"; and (2) the order
violated must have been reasonable, lawful, made known to the employee, and must
pertain to the duties which he had been engaged to discharge. Here, there is no
substantial evidence that would show that Ballesteros willfully violated the verbal
instructions. There is lack of substantial evidence that would show that the company gave
clear verbal instructions regarding the preparation of deposit slips.
Loss of trust and confidence may be a just case for termination of employment
only upon proof that: (1) the dismissed employee occupied a position of trust and
confidence; and (2) the dismissed employee committed "an act justifying the loss of trust
and confidence.” The first element was met since Ballesteros was an administrative
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officer at the time of her termination and she held a position of trust, but the second
element is not present. Ballesteros' monetary shortage in the amount of P1,100.00 cannot
be considered substantial and severe, as to justify the company's loss of trust and
confidence in her. Furthermore, not only did Ballesteros admit that she was negligent in
not counting the money before returning the same, the amount was even deducted from
her salary and returned to the company. Thus, Ballesteros was illegally terminated.
105
REGALA VS.
MANILA HOTEL CORP.
HERNANDO, J.
G.R. No. 204684 October 5, 2020
CONSTRUCTIVE DISMISSAL
DOCTRINE
There is constructive dismissal where "there is cessation of work because
'continued employment is rendered impossible, unreasonable or unlikely, as an offer
involving a demotion in rank or a diminution in pay' and other benefits. Aptly called a
dismissal in disguise or an act amounting to dismissal but made to appear as if it were
not, constructive dismissal may, likewise, exist if an act of clear discrimination,
insensibility, or disdain by an employer becomes so unbearable on the part of the
employee that it could foreclose any choice by him except to forego his continued
employment."
FACTS
Regala was hired by Manila Hotel Corporation (MHC) as one of its waiters assigned
to the Food and Beverage Department. He was later assigned as cook helper at MHC's
Chocolate Room/Cookies Kitchen. In the course of his employment as waiter/cook helper,
Regala worked for six (6) days every week, and was paid a daily salary of P382.00 until
sometime in December 2009. Regala alleged that he was not recognized as a regular
rank-and-file employee despite having rendered services to MHC for several years.
Moreover, he claimed that MHC constructively dismissed him from employment when it
allegedly reduced his regular work days to two (2) days from the normal five (5)-day work
week starting December 2, 2009, which resulted in the diminution of his take home salary.
MHC denied outright that Regala is its regular employee, and claimed that he is a
mere freelance or "extra waiter" engaged by MHC on a short-term basis. It explained that
it employs extra waiters at fixed and/or determinable periods particularly when there are
temporary spikes in the volume of its business. MHC presented a sample fixed-term
service contract, and copies of Regala's Department Outlet Services Contracts for Extra
Waiters/Cocktail Attendants (Service Agreements) covering the periods of his supposed
temporary engagement with MHC, or from March 1, 2010 to March 3, 2010. MHC
contended that prior to engaging the services of extra waiters, applicant waiters, such as
Regala, and MHC execute fixed-term service contracts and agree on a specific duration of
engagement depending on the requirement of the hotel in a given period.
The Labor Arbiter dismissed the complaint for lack of merit. In his appeal to the
NLRC, Regala averred that the LA erred in finding that he was a fixed-term employee of
MHC and that he was not constructively dismissed from employment. The NLRC reversed
the Decision of the LA and held that Regala is a regular employee of MHC. MHC filed a
Motion for Reconsideration which was denied by the NLRC. Aggrieved, MHC filed a Petition
for before the CA and granted MHC's Petition for Certiorari. Regala filed a Motion for
Reconsideration but the CA denied. Hence, this petition.
106
ISSUE
Was Regala constructively dismissed from employment
HELD
Yes, Regala was constructively dismissed from employment. Being a regular
employee of MHC, Regala is entitled to security of tenure. Hence, he cannot be dismissed
from employment, constructive or otherwise, except for just or authorized causes.
Regala's case is premised on the notion that he is a regular employee entitled to security
of tenure but was constructively dismissed when MHC, without valid cause, reduced his
regular work days from five (5) days to two (2) days.

employment." In the case at bar, the reduction of Regala's regular work days from five (5)
days to two (2) days resulted in a diminution in pay. Regala's change in his work schedule
resulting in the diminution of his take home salary is, therefore, tantamount to
constructive dismissal.
The fact that Regala may have continued reporting for work does not rule out
constructive dismissal, nor does it operate as a waiver. The fact of constructive dismissal
should be reckoned on December 2, 2009, or from the time Regala was made to accept
the changes of his work schedule which thereby resulted in the diminution of his take
home pay. Regala's constructive dismissal, reinstatement, and payment of backwages
must necessarily be made. Regala's backwages must be computed from the time he was
made to accept the changes of his work schedule which thereby resulted in the
diminution of his take home pay, or from December 2, 2009, up to actual reinstatement.
Hence, Regala is a regular employee of MHC that have been constructively dismissed from
employment.
107
GOSOSO VS.
LEYTE LUMBER YARD AND HARDWARE, INC.
HERNANDO, J.
G.R. No. 205257 January 13, 2021
CONSTRUCTIVE DISMISSAL; ABANDONMENT
DOCTRINE
Abandonment requires the concurrence of the following: (1) the employee must
have failed to report for work or must have been absent without valid or justifiable
reason; and (2) there must have been a clear intention to sever the employer-employee
relationship manifested by some overt acts. Abandonment is a matter of intention and
cannot lightly be presumed from equivocal acts. Absence must be accompanied by overt
acts pointing definitely to the fact that the employee simply does not want to work
anymore. The burden of proof to show that there was unjustified refusal to go back to
work rests on the employer.
Mere absence or simple failure to report for work is not abandonment, more so if
the employee was able to lodge his complaint before the labor tribunals with haste. An
immediate filing of a complaint for illegal dismissal, more so when it includes a prayer for
reinstatement, is inconsistent with a charge of abandonment. Indeed, employees like
Gososo who take steps to protest their alleged dismissal cannot be said to have
abandoned their work.
FACTS
Fernando Gososo, petitioner, filed a complaint for illegal constructive dismissal
against Leyte Lumber Yard and Hardware, Inc. (Leyte Lumber), and Ruben Yu,
respondents, non-payment of salary, overtime pay, premium pay for holiday and rest day
allowance, vacation and sick leave pay, separation pay, moral damages, and attorney's
fees.
Leyte Lumber, a construction supply, and hardware store, hired Gososo as a sales
representative. Ruben Yu, respondent, was Leyte Lumber's general manager. As a
company policy, Leyte Lumber's sales representatives were prohibited from getting items
or stocks from the storage area by themselves. They were to course the orders through
authorized checkers before the items are released, and they are prohibited from leaving
their designated work areas without their superior's consent. Moreover, they were
required to submit their applications for leave days before the intended dates to allow
the management ample time to approve the application and to adjust the workforce and
their workload.
Gososo allegedly overstepped the boundaries of Leyte Lumber's company policies,

when he was on his way to the stock room to follow up on a customer's urgent order
when Yu stopped him. Yu required Gososo to produce a letter of apology for the incidents
under pain of dismissal. Admitting fault, Gososo submitted a letter of apology to Yu on
October 8, 2008. He reasoned that he was just doing his job for the company's clients and
108
that he never intended to neglect his duties or disobey the company policy. Yu allegedly
refused to accept the letter of apology and instructed Gososo to write further in his letter
the words "I am not supposed to approach the checker" and "I promise again to ask
permission from manager before I can go out." Gososo submitted the revised letter of
apology to Yu. When he returned, Yu allegedly told Gososo to sign a prepared document
and Gososo declined since the document contained admissions of offenses that he did not
commit. Irked by Gososo's refusal, Yu informed him of his termination from work.
Leyte Lumber and Yu posited that Gososo failed to ensure the integrity of
transactions and secure company stocks. A security guard of the company attested that
she saw Gososo leave his designated work area. Gososo submitted a letter admitting to his
transgressions. On the same day, Leyte Lumber and Yu issued him a Memorandum
reminding him of the company policies he violated, with a warning that further violations
shall merit dismissal from work. Gososo refused to acknowledge receipt of the
Memorandum. Also, Leyte Lumber and Yu claimed that Gososo filed a leave of absence for
October 11, 2008 purportedly to attend his son's graduation, in disregard of the rule that
leaves of absence must be filed and approved days before the actual date of leave. These
prompted Leyte Lumber and Yu to issue Gososo another Memorandum wherein they
requested him to report back to work, otherwise he will be considered to have abandoned
his work, but Gososo did not report back.
The Labor Arbiter ruled in favor of Leyte Lumber and Yu. Gososo went up to the
NLRC on appeal, and the NLRC reversed the decision of the Labor Arbiter and found
Gososo to have been illegally dismissed by Leyte Lumber and Yu. As the NLRC denied
respondents' Motion for Reconsideration, they filed a Petition for Certiorari with the CA.
The CA reinstated the decision of the Labor Arbiter. The CA did not reconsider its
Decision. Hence, this petition.
ISSUE
Did CA correctly determine that Gososo abandoned his work and was legally
dismissed by Leyte Lumber and Yu.
HELD
No, the CA erred in determining that Gososo abandoned his work and was legally
dismissed by Leyte Lumber and Yu. In labor cases, substantial evidence is the basic
minimum of required proof — or that amount of evidence a reasonable mind might accept
as adequate to support a conclusion. In illegal dismissal cases, the employee must first
establish by substantial evidence the fact of dismissal before the employer is charged
with the burden of proving its legality. The Court finds no working basis to declare Gososo
had been dismissed, whether legally, illegally, or constructively. At the same time, Gososo
is not guilty of abandonment.
Abandonment requires the concurrence of the following: (1) the employee must
have failed to report for work or must have been absent without valid or justifiable
reason; and (2) there must have been a clear intention to sever the employer-employee
relationship manifested by some overt acts. Abandonment is a matter of intention and
109
cannot lightly be presumed from equivocal acts. Absence must be accompanied by overt
acts pointing definitely to the fact that the employee simply does not want to work
anymore. The burden of proof to show that there was unjustified refusal to go back to
work rests on the employer.
In the case at bar, Leyte Lumber and Yu did not discharge the burden of proof of
abandonment. Mere absence or simple failure to report for work is not abandonment,
more so if the employee was able to lodge his complaint before the labor tribunals with
haste. An immediate filing of a complaint for illegal dismissal, more so when it includes a
prayer for reinstatement, is inconsistent with a charge of abandonment. Indeed,
employees Gososon who take steps to protest their alleged dismissal cannot be said to
have abandoned their work. Leyte Lumber and Yu just surmised that Gososo had no intent
to return to work when he allegedly went on an unapproved leave of absence on October
11, 2008, of which they were also the approving authority. Moreover, while Leyte Lumber
and Yu issued the Memorandum requiring petitioner to return to work, records do not
disclose whether Gososo was actually furnished copies of this Memorandum. To claim that
Gososo blatantly disregarded respondents' return-to-work order, when Gososo was never
shown to have received a copy of the same, speaks volumes of Gososo's vague intent to
abandon his work and respondents' attempt to tweak facts in their favor. Hence, Gososo is
not guilty of abandonment.
110
DELA TORRE VS.
TWINSTAR PROFESSIONAL PROTECTIVE SERVICES, INC.
HERNANDO, J.
GR No. 222992 January 23, 2021
DOCTRINE
employment."
In case of termination of employment for offenses and misdeeds by employees

under Article 297 (formerly 282) of the Labor Code, employers are required to adhere to
the so-called "two-notice rule."
FACTS
Jose R. Dela Torre, petitioner, was employed as a security guard by Twinstar
Professional Protective Services, Inc. (Twinstar), respondent. Petitioner alleged that he
was on floating status for more than six (6) months which prompted him to file a
complaint for illegal dismissal and non-payment of separation pay. Summons for
mandatory conferences were sent to Twinstar. Respondents failed to attend and were not
able to submit their position paper with the Labor Arbiter (LA).
The LA held that petitioner was constructively dismissed, and thus entitled to
backwages and separation pay in lieu of reinstatement. Twinstar then filed an appeal with
the National Labor Relations Commission (NLRC). The NLRC rendered a decision, granting
Twinstar's appeal and reversing the assailed LA Decision. The NLRC applied liberality and
allowed the presentation of Twinstar's evidence for the first time on appeal, and ruled
that no constructive dismissal took place. The CA rendered the assailed decision which
denied the petitioner for lack of merit. The CA ruled that the NLRC did not commit grave
abuse of discretion amounting to lack or excess of jurisdiction when it allowed Twinstar to
present its evidence for the first time on appeal and when it ruled that petitioner was not
illegally dismissed.
ISSUE
Is there constructive dismissal in the case at bar.
HELD
111
No, there was no constructive dismissal in the case at bar and that there was just
cause to terminate the petitioner's employment. It is evident that statutory due process
was not followed by Twinstar. It must be reiterated that in the case of termination of
employment for offenses and misdeeds by employees, i.e., for just causes under Article
297 (formerly 282) of the Labor Code, employers are required to adhere to the so-called
"two-notice rule."
The first written notice to be served on the employees should contain the specific
causes or grounds for termination against them, and a directive that the employees are
given the opportunity to submit their written explanation within a reasonable period.
"Reasonable opportunity" under the Omnibus Rules means every kind of assistance
that management must accord to the employees to enable them to prepare adequately
for their defense. This should be construed as a period of at least five (5) calendar days
from receipt of the notice to give the employees an opportunity to study the accusation
against them, consult a union official or lawyer, gather data and evidence, and decide on
the defenses they will raise against the complaint. Moreover, in order to enable the
employees to intelligently prepare their explanation and defenses, the notice should
contain a detailed narration of the facts and circumstances that will serve as basis for the
charge against the employees. A general description of the charge will not suffice. Lastly,
the notice should specifically mention which company rules, if any, are violated and/or
which among the grounds under Art. 282 is being charged against the employees.
After serving the first notice, the employers should schedule and conduct a
hearing or conference wherein the employees will be given the opportunity to: (a) explain
and clarify their defenses to the charge against them; (b) present evidence in support of
their defenses; and (c) rebut the evidence presented against them by the management.
During the hearing or conference, the employees are given the chance to defend
themselves personally, with the assistance of a representative or counsel of their choice.
Moreover, this conference or hearing could be used by the parties as an opportunity to
come to an amicable settlement.
112
TACIS VS.
SHIELDS SECURITY SERVICES, INC.
HERNANDO, J.
GR No. 234575 July 7, 2021
DOCTRINE
For resignation from employment to be valid, there must be an intent to relinquish
the position together with the overt act of relinquishment. Resignation must be voluntary.
In illegal dismissal cases, the employer, if defense of resignation is presented, must show
that the employee indeed voluntarily resigned.
FACTS
Petitioners Renato C. Tacis and Dionicio Lamis III filed a complaint for illegal
dismissal, with claims for payment of full backwages, separation pay in lieu of
reinstatement and salary differentials against respondent, Shields Security Services, Inc.
(Company). Along with the company, individual respondents, Teresita Soliman and
Dionefel Morante are being sued in their capacities as the company's President and
General Manager, respectively.
Morante informed petitioners that they are relieved and terminated from service
and that the 15 new hires will replace them as per the client's (Texas Instruments)
request. Morante then gave petitioners checks representing their "retirement pay" and
advised them that the other benefits due them such as 13th month pay and last salary
shall be given upon their return to Manila. The petitioners objected to their severance
arguing that there was no valid ground for their dismissal as they did not commit any
infraction during their employment with the Company. In order to appease petitioners,
Morante made a commitment to transfer them to Soliman Security Services, a sister
company of Shields Security. Convinced that they would be absorbed by Soliman Security,
petitioners submitted their respective resignation letters and quit claims. However, upon
inquiry on the status of their transfer to Soliman Security, Morante informed Tacis that
there was no vacancy at Soliman Security. This prompted petitioners to file the instant
complaint before the National Labor Relations Commission.
Respondents belied petitioners' claim of illegal dismissal. They averred that

petitioners voluntarily resigned from their employment as evidenced by their individual
handwritten resignation letters which were duly accepted by the Company. In fact, they
were given the option to go to Manila for their next assignment but they opted to resign.
The LA held that there was no valid cause for petitioners' dismissal. Respondents'
claim that it was the request of their client Texas Instruments to replace petitioners was
not substantiated at all. However, the NLRC reversed the LA Decision finding that
petitioners' resignation was voluntary as shown by their expression of gratitude and
appreciation to the Company for the opportunity given to them. Further, the quitclaim
and waiver executed by petitioners confirmed their resignation from the company. There
113
was no showing that petitioners were compelled to sign the same or that they did not
fully understand the consequences of signing a quitclaim. The CA concluded that
petitioners failed to substantiate their claim of vitiated consent.
ISSUE
Is there constructive dismissal in the case at bar.
HELD
No, there is no constructive dismissal in the case at bar. Petitioners' resignation
was voluntary, thus there was no constructive dismissal. The test of constructive dismissal
is whether a reasonable person in the employee's position would have felt compelled to
give up his position under the circumstances. It is an act amounting to dismissal but made
to appear as if it were not. It must be noted, however, that bare allegations of
constructive dismissal, when uncorroborated by the evidence on record, cannot be given
credence. The acts of petitioners before and after the resignation do not show that undue
force was exerted upon them.
While the Court recognizes the rule that in illegal dismissal cases, the employer
bears the burden of proving that the termination was for a valid or authorized cause, in
the present case, however, the facts and evidence do not establish a prima facie case that
petitioners were dismissed from employment. Settled is the rule that before the employer
must bear the burden of proving that the dismissal was legal, the employee must first
establish by substantial evidence the fact of his dismissal from service. Logically, if there
is no dismissal, then there can be no question as to its legality or illegality. Bare
allegations of constructive dismissal, when uncorroborated by the evidence on record,
cannot be given credence.
In sum, the Supreme Court agrees with the NLRC and the CA that no constructive
dismissal took place in the instant case. As shown, petitioners failed to substantiate their
claims of constructive dismissal for there was no proof that their resignation letters were
tainted with deceit and bad faith, as they strongly claim.
114
PHILAM HOMEOWNERS ASSOCIATION, INC. VS. DE LUNA
HERNANDO, J.
GR No. 209437 March 17, 2021
ILLEGAL DISMISSAL
DOCTRINE
For a dismissal to be valid, it must comply with the substantive and the procedural
due process. An employee cannot be terminated without just or authorized cause. The
twin-notice rule must be observed, and the erring employee must be given the
opportunity to present his/her side of the controversy.
FACTS
Philam Homeowners Association, Inc. (PHAI) and Marcia Caguiat, President and
Chief Executive Officer of PHAI, both petitioners filed a petition for Certiorari in relation
to the decision of the Court of Appeals (CA) favoring respondents Sylvia De Luna and
Nenita Bundoc. De Luna and Bundoc used to work with PHAI. During an audit of PHAI's
books of accounts sometime in September 2008, several irregularities were discovered
such as issuance of unauthorized official and provisional receipts, unrecorded and
undeposited collections, and encashment of personal checks.
The Investigating Committee disclosed that De Luna and Bundoc were involved in
said fraudulent activities particularly in the disbursement of PHAI's funds. De Luna and
Bundoc were dismissed for just cause, particularly under Article 282 (c) of the Labor Code
for fraud or willful breach of trust and confidence by an employee.
The LA found that the termination of both De Luna and Bundoc was legal since it
was based on a just cause, and that due process was observed. On the other hand, the
NLRC affirmed in toto the findings of the Arbiter that De Luna and Bundoc held positions
of trust and confidence, hence, they are expected to exercise greater fidelity, honesty
and integrity in the performance of their duties. Further, the loss of trust and confidence
as just cause for dismissal should relate to the performance of their duties.
The CA affirmed the ruling of the NLRC with modification as to the monetary
award. It affirmed the finding that the positions of De Luna and Bundoc were imbued with
trust and confidence as both handled PHAI's finances, transactions and expenditures. With
regard to the due process requirement and the matter of preventive suspension, the
appellate court found that PHAI failed to comply with the procedural due process
requirement as regards Bundoc.
ISSUE
Was the dismissal of the respondents valid.
HELD
No, the dismissal of the respondents is not valid.
115
For a dismissal to be valid, it must comply with the substantive and the procedural
due process. An employee cannot be terminated without just or authorized cause. The
twin-notice rule must be observed, and the erring employee must be given the
opportunity to present his/her side of the controversy. The Court found that PHAI failed
to prove that Bundoc was notified and given the chance to explain and to refute the
accusations against her. Bundoc was not notified of the charges leveled against her or of
her termination. This clearly amounted to a violation of Bundoc's right to procedural due
process.
To balance the interest of labor and capital, employees who occupy positions
imbued with trust and confidence are reminded that they are expected to observe utmost
integrity, honesty and loyalty in the performance of their duties and responsibilities. On
the other hand, employers, in the exercise of their management prerogative, must strictly
comply with the requirements of due process in imposing disciplinary sanctions and
terminating the services of their employees.
Moreover, it must also be remembered that an employee may be preventively

suspended while undergoing investigation for an alleged violation, in order for the
investigation to run its course and to avert any possibility where the employee may cause
harm or injury to the employer, its company or to his fellow employees. When the 30 days
expire, the employer should reinstate the employee by actual or payroll reinstatement.
Thus, Philam Homeowners Association, Inc. is ordered to pay respondent Sylvia De

Luna her corresponding salary, allowances and other benefits from May 13, 2009 to May
23, 2009 or for a period often (10) days and to pay respondent Nenita Bundoc the amount
of P30,000.00 as nominal damages.
116
BANCE VS.
UNIVERSITY OF ST. ANTHONY
HERNANDO, J.
GR No. 202724 February 3, 2021
VOLUNTARY RESIGNATION
DOCTRINE
FACTS
Petitioners Susan Bance, Arlene Dimaiwat, Jean Velasco, Nancy Aguirre, and Hazel
Lobetania (collectively, petitioners) filed complaints for illegal dismissal with money
claims against respondents University of St. Anthony (University) and Atty. Santiago
Ortega, Jr. (collectively, respondents).
The petitioners were regular employees of the University. In June 2006, several
irregular and anomalous transactions were noted in the University's Accounting Office.
Atty. Ortega hired an external auditor to conduct an investigation that revealed a cash
shortage.
Lobetania, one of the petitioners, admitted that she failed to deposit the amount
in the University's bank account. Upon demand to return the amount, Lobetania paid it in
installments out of her personal funds as evidenced by official receipts issued by the
University under her name. In a subsequent audit report, additional anomalous
transactions in the prior years surfaced. Lobetania went on leave for the duration of the
audit. Eventually, Lobetania tendered her resignation which was accepted by Atty.
Ortega. Thereafter, she was charged with Qualified Theft before the RTC of Iriga.
At around the same period, Bance, Dimaiwat, and Aguirre, the other petitioners
were found to have taken advantage of their positions in the Accounting Office by
enrolling their children and relatives, including Velasco's, under the University's group
enrollment incentive program despite knowing that they were unqualified.Upon the
discovery of the scheme, Atty. Ortega ordered an investigation and called a conference
with the alleged perpetrators.
During the conference, the petitioners were apprised of their infractions and
admitted that their children and relatives benefitted from the unauthorized discounts. As
such, Atty. Ortega verbally informed them that their employment will be terminated. An
office memo was issued by Atty. Ortega informing them that their employment will be
terminated on grounds of dishonesty amounting to malversation of school funds.
Dimaiwat, Velasco, and Aguirre opted to resign which was approved by Atty. Ortega.
117
Bance did not tender her resignation. Subsequently, the University filed criminal cases for
Estafa against Bance, Dimaiwat, Velasco, and Aguirre.
Bance, Dimaiwat, Velasco, and Aguirre filed their respective complaints for illegal
dismissal with money claims against the respondents. Lobetania filed her complaint shorty
thereafter.
The Labor Arbiter rendered a Decision finding petitioners to have been illegally
dismissed. The National Labor Relations Commission reversed and set aside the decision of
the Labor Arbiter ruling that the petitioners were not illegally dismissed. The NLRC ruled
that the complaints for illegal dismissal have no basis as petitioners, except for Bance,
had voluntarily resigned before the effectivity of the termination of their employment. As
for Bance, the criminal charges for Estafa filed by the University against her provided
ample basis for her dismissal on grounds of serious misconduct and loss of trust and
confidence. However, procedural due process was not observed in the termination of
Bance’s employment, thus it awarded nominal damages. The Court of Appeals affirmed
the ruling of the NLRC. Hence, this petition.
ISSUE
Did the voluntary resignation of Lobetania, Dimaiwat, Velasco, and Aguirre render
their complaints for illegal dismissal without any basis.
HELD
Yes, the voluntary resignation of Lobetania, Dimaiwat, Velasco, and Aguirre
rendered their complaints for illegal dismissal without any basis. Central Azucarera De
Bais, Inc. v. Siason discusses the concept of resignation:
Resignation is the formal pronouncement or relinquishment of a position

or office. It is the voluntary act of an employee who is in a situation where he
believes that personal reasons cannot be sacrificed in favor of the exigency of
the service, and he has then no other choice but to disassociate himself from
employment. The intent to relinquish must concur with the overt act of
relinquishment; hence, the acts of the employee before and after the alleged
resignation must be considered in determining whether he in fact intended to
terminate his employment. In illegal dismissal cases, it is a fundamental rule
that when an employer interposes the defense of resignation, on him
necessarily rests the burden to prove that the employee indeed voluntarily
resigned.

In the instant case, the fact of petitioners' resignation is undisputed. Lobetania

tendered her resignation on July 27, 2007, and was approved by Atty. Ortega on August 9,
118
2007. Dimaiwat, Velasco, and Aguirre tendered their resignation on December 22, 2007,
and these were approved by Atty. Ortega on December 26, 2007. In examining the totality
of circumstances, respondents showed that Lobetania, Dimaiwat, Velasco, and Aguirre
voluntarily resigned prior to the effectivity date of the termination of their employment.
There were ongoing investigations against petitioners for the irregular acts they
committed thereby placing them in a difficult position. Moreover, from the wording of the
resignation letters, it can be implied that petitioners' resignations were voluntary. Though
not the sole test, the wording of resignation letters may be considered as a factor,
together with other circumstances, in assessing the voluntariness of a resignation. Also, to
emphasize, petitioners did not contend or present countervailing evidence that their
resignation was involuntary. Likewise, "it is settled that there is nothing reprehensible or
illegal when the employer grants the employee a chance to resign and save face rather
than smear the latter's employment record."
Thus, because of the voluntary resignations of Lobetania, Dimaiwat, Velasco, and

Aguirre prior to the termination of their employment, their complaints for illegal dismissal
have no basis.
119
PHILIPPINE NATIONAL BANK VS. BULATAO
HERNANDO, J.
GR No. 200972 December 11, 2019
AWARD OF SEPARATION PAY SUBTOPIC
DOCTRINE
Although reinstatement is a matter of right, the award of separation pay is an
exception to such rule, as it is awarded in lieu of reinstatement in the following
circumstances: (a) when reinstatement can no longer be effected in view of the passage
of a long period of time or because of the realities of the situation; (b) reinstatement is
inimical to the employer's interest; (c) reinstatement is no longer feasible; (d)
reinstatement does not serve the best interests of the parties involved; (e) the employer
is prejudiced by the workers' continued employment; (f) facts that make execution unjust
or inequitable have supervened; or (g) strained relations between the employer and
employee."
FACTS
Respondent Manuel Bulatao was the Senior Vice-President (SVP) of the Information
Technology (IT) Group of petitioner Philippine National Bank (PNB). Bulatao alleged that
Mr. Benjamin Palma Gil, then PNB's President, and a certain Mr. Samit Roy (Mr. Roy), an
Indian national, hosted a dinner meeting for PNB's IT staff to announce the conclusion of a
Joint Venture Agreement (JVA) between PNB and Mr. Roy.
During dinner Mr. Roy announced that not all of the IT staff would be retained
since everyone had to undergo an International Competitive Test as a prerequisite for
absorption. Those who would not be absorbed would be offered retirement packages
instead. Bulatao contended that the conduct of the International Competitive Test was a
ploy to force IT personnel not supportive of the project to leave the bank. Notably,
Bulatao was one of those who objected to the Joint Venture Agreement (JVA) because of
the supposed huge capital exposure on PNB's end.
Eventually, Bulatao manifested his intent to retire in a letter addressed to Mr.

Palma Gil. When the deal with the Indian group did not materialize, Bulatao made a
sudden turn-around. Meanwhile, Bulatao alleged that he had a meeting with Mr. Lucio Tan
who asked him to reconsider his decision to retire and join Mr. Tan’s team. Because of
this, Bulatao alleged that he went back to work. Around that time, aware that the Board
had not yet acted on his application for retirement, Bulatao withdrew the said application
in a Memorandum.
Four days from the date of his Memorandum, Bulatao received a call from the SVP
of Human Resource Division who informed him not to report for work in February 2000 as
the Board already accepted his "resignation." For this reason, Bulatao stopped reporting
for work. Subsequently, he filed a Complaint for illegal dismissal with the NLRC.
120
Thereafter, Bulatao received a letter from Manuel Mendoza, the Executive Vice
President of PNB informing him that the Board approved and confirmed the acceptance of
his resignation. Meanwhile, the Complaint filed by Bulatao with the NLRC was dismissed
for lack of jurisdiction. The NLRC held that since Bulatao was an appointed officer of a
corporation, it is the Regional Trial Court (RTC) which has jurisdiction over the case.
The RTC rendered a decision finding no proof that Bulatao returned to work.
Additionally, there was no document showing that his absence was with prior leave,
leading the trial court to conclude that Bulatao abandoned his employment when he went
on voluntary leave for 81 days upon submission of a request to avail of an early retirement
scheme. His intention to sever his employment with PNB was clearly reflected in his letter
when he stated that he cannot stay in the employ of the bank and that PNB should find a
replacement.
Bulatao filed a motion for reconsideration but it was denied by the RTC. Bulatao
appealed to the Court of Appeals. The CA held that PNB failed to present evidence to
show that there was no announcement regarding the availability of a retirement scheme
that encouraged Bulatao to apply for one. The CA declared Bulatao illegally dismissed and
entitled to reinstatement and backwages.
ISSUE
Is reinstatement feasible in this case.
HELD
No, reinstatement is not feasible. Although reinstatement is a matter of right, the
award of separation pay is an exception to such rule, as it is awarded in lieu of
reinstatement in the following circumstances:
(a) when reinstatement can no longer be effected in view of the passage of a long
period of time or because of the realities of the situation;
(b) reinstatement is inimical to the employer's interest;
(c) reinstatement is no longer feasible;
(d) reinstatement does not serve the best interests of the parties involved;
(e) the employer is prejudiced by the workers' continued employment;
(f) facts that make execution unjust or inequitable have supervened; or
(g) strained relations between the employer and employee."
Taking into account the lapse of time as well as the age and capacity to work of
Bulatao, reinstatement is no longer feasible. In fact, Bulatao revealed that he has
suffered and is still suffering from various medical ailments such as stroke, arthritis, gout,
cervical spondylosis, and even had to undergo cancer treatments and heart surgery during
the pendency of this case. Thus, the grant of separation pay in lieu of reinstatement is
more appropriate under the circumstances
121
ITALKARAT 18, INC. VS. GERASMIO
HERNANDO, J.
SEPARATION PAY
DOCTRINE
As a general rule, the law does not require employers to pay employees that have
resigned any separation pay, unless there is a contract that provides otherwise or there
exists a company practice of giving separation pay to resignees.
FACTS
Respondent Juraldine Gerasmio filed a complaint for illegal dismissal against the
petitioner Italkarat Inc. Juraldine alleged that he was hired in 1990 and that he was
designated as the Maintenance Head and Tool and Die Maker until his dismissal on the
ground of serious business losses. He claimed that during and prior to the last quarter of
2008, the Company had repeatedly informed its employees of its proposed retrenchment
program because it was suffering from serious business losses.
Juraldine claimed that Noel San Pedro, the then Officer-In-Charge (OIC)/Manager
of the Company, informed him that the Company was planning to retrench a substantial
number of workers in the Maintenance and Tool and Die Section; and that if he opts to
retire early, he will be given a sum of P170,000.00. San Pedro then allegedly cautioned
Juraldine that if he will not accept the offer to retire early, the Company would
eventually retrench or terminate him from his employment, in which case, he might not
even receive anything.
As such, Juraldine executed and signed a resignation letter and quitclaim. He was
then informed to return to get his check worth Php 170,000. However, Juraldine was later
informed by San Pedro that he would only receive Php 26,901.34. Thus, Juraldine, through
his lawyer, sent a letter essentially demanding the amount of P170,000.00 he was
allegedly promised earlier. Since the Company did not respond, Juraldine filed a
complaint for illegal dismissal.
On the other hand, Italkarat alleged that Juraldine voluntarily resigned from his
job. Thus, his claims are baseless. The Company stated that Juraldine tendered his
resignation and demanded from the Company the payment of his separation pay on
account of his long years of service and that he executed and signed a waiver and
quitclaim which shows the computation of his receivables.
The Labor Arbiter ruled that Juraldine was only forced to resign because of San
Pedro's misrepresentation that he would be paid P170,000.00 as separation pay. Italkarat
appealed to the National Labor Relations Commission which the NLRC granted. The NLRC
found that Juraldine voluntarily resigned from his job. Juraldine filed a Petition for
Certiorari with the Court of Appeals. The CA granted the Petition for Certiorari and found
122
that Juraldine’s resignation was not unconditional since he was demanding payment for
his separation pay in accordance with the alleged company practice.
ISSUE
Is Juraldine entitled to separation pay.
HELD
No, Juraldine is not entitled to separation pay. Considering that there was no
dismissal involved in this case as Juraldine voluntarily resigned from work, the claims
arising from his complaint for illegal dismissal must be denied. This includes his claim for
separation pay as he failed to prove his entitlement thereto, either via contract or
company practice.
As a general rule, the law does not require employers to pay employees that have
resigned any separation pay, unless there is a contract that provides otherwise or there
exists a company practice of giving separation pay to resignees.
Juraldine failed to show that he has a perfected contract with the Company
regarding his separation pay. To prove that the Company owed him separation pay,
Juraldine primarily relied on his resignation letter and the subsequent demand letter
written by his lawyer. The contents of the resignation letter would reveal that Juraldine
merely believed that he was entitled to separation pay and was not even demanding for a
certain amount. In short, his resignation was irrevocable and is patently unconditional.
Aside from contract, Juraldine alternatively argued that it was a company practice
to give resignees separation pay. To prove his allegations, Juraldine relied on affidavits of
two former employees of the Company.
A company's practice of paying separation pay to resignees must be proven to exist

as this is an exception to the general rule that employees who voluntarily resign are not
entitled to separation pay.
In this case, we agree with the NLRC's findings that there was no company
practice. The evidence would show that the affidavits presented by Juraldine were made
by former employees who were not in the same department or job position as him. These
affidavits are not sufficient in proving that the Company gives separation pay as a matter
of practice.
123
JURISDICTION AND REMEDIES
NLRC JURISDICTION
DEL PILAR VS.
BATANGAS II ELECTRIC COOPERATIVE, INC.
HERNANDO, J.
GR No. 160090 and 160121 February 9, 2020
JURISDICTION OF THE NLRC
DOCTRINE
Decisions, awards, or orders of the Labor Arbiter are final and executory unless
appealed to the NLRC. The NLRC has exclusive appellate jurisdiction over all cases
decided by labor arbiters as provided in Article 217(b) of the Labor Code. From the
finding of illegal dismissal up to the execution of the monetary award, the jurisdiction of
the NLRC is appellate in nature. Article 218(e) of the Labor Code does not provide blanket
authority to the NLRC or any of its divisions to issue writs of injunction, considering that
Section 1 of Rule XI of the New Rules of Procedure of the NLRC makes injunction only an
ancillary remedy in ordinary labor disputes.
FACTS
Complainants were employees of BATELEC II occupying various positions. They held
rallies to denounce the alleged corrupt, anomalous and irregular activities of some
BATELEC II officials. They were dismissed for participating in an illegal strike, prompting
the complainants and other employees to file a case for illegal dismissal against BATELEC
II.
Labor Arbiter Pedro C. Ramos rendered a Decision in favor of the complainants and
ordered for their reinstatement and payment of backwages and damages. While the
employment relationship between complainants and BATELEC II had resumed, however,
during the execution stage, BATELEC II filed a Manifestation with Motion stating that
reinstatement of the illegally dismissed employees was no longer feasible due to
reorganization which abolished the positions pertaining to complainants. BATELC II offered
to pay one (1) month salary for every year of service. The NLRC and the CA treated
BATELEC II's refusal to reinstate as retrenchment, a form of authorized dismissal. They
then ordered to pay the complainants their separation pay and full backwages.
BATELEC II elevated the case to this Court and challenged the award of full
backwages. The Court upheld the ruling of the CA and ruled that the award of backwages
is proper, regardless of whether or not there was physical or legal impossibility of
reinstatement, BATELEC II having failed to observe the procedure for termination of
employment as set forth in Article 283 of the Labor Code.
BATELEC II then appealed to the NLRC, refuting the computation submitted by

complainants regarding the backwages. The NLRC partially granted the appeal and ruled
that in computing for backwages. Undeterred, BATELEC II elevated the case to the CA
124
raising as issue the payment of full backwages and its coverage. The CA affirmed with
modification the ruling of the NLRC. Moreover, this Court held that, in the case at bar,
backwages were awarded to private respondents not as a consequence of illegal dismissal,
but as penalty for petitioner's non-compliance with the one-month notice requirement.
Dissatisfied with the CA ruling, both parties separately filed their Petitions for
Review on Certiorari. Complainants claim that the CA gravely erred in entertaining the
appeal, more so because not only did it disturb the computation of the Labor Arbiter, it
also revived controversies already adjudicated upon. Complainants add that instead of an
appeal to the CA, BATELEC II should have filed a petition for injunction with the NLRC
questioning the computation of the award pursuant to Rule XI, Section 1 of the New Rules
of Procedure of the NLRC.
ISSUE
Does the NLRC have jurisdiction to decide an appeal.
HELD
Yes, the NLRC has jurisdiction over the case. Article 223 provides that decisions,
awards, or orders of the Labor Arbiter are final and executory unless appealed to the
NLRC. The NLRC has exclusive appellate jurisdiction over all cases decided by labor
arbiters as provided in Article 217(b) of the Labor Code. From the finding of illegal
dismissal up to the execution of the monetary award, the jurisdiction of the NLRC is
appellate in nature. "Article 218(e) of the Labor Code does not provide blanket authority
to the NLRC or any of its divisions to issue writs of injunction, considering that Section 1
of Rule XI of the New Rules of Procedure of the NLRC makes injunction only an ancillary
remedy in ordinary labor disputes."
Furthermore, Article 225(e) of the Labor Code empowers the NLRC "[t]o enjoin or
restrain any actual or threatened commission of any or all prohibited or unlawful acts or
to require the performance of a particular act in any labor dispute which, if not
restrained or performed forthwith, may cause grave or irreparable damage to any party or
render ineffectual any decision in favor of such party," while Sec. 1, Rule X of the 2011
NLRC Rules of Procedure, as amended, pertinently provides as follows:
Section 1. Injunction in Ordinary Labor Dispute. - A preliminary injunction

or a restraining order may be granted by the Commission through its divisions
pursuant to the provisions of paragraph (e) of Article 218 [now 225 of the Labor
Code, as amended, when it is established on the basis of the sworn allegations in
the petition that the acts complained of, involving or arising from any labor
dispute before the Commission, which, if not restrained or performed forthwith,
may cause grave or irreparable damage to any party or render ineffectual any
decision in favor of such party.
125
ESICO VS. ALPHALAND CORP.
HERNANDO, J.
GR No. 216716 November 17, 2021
JURISDICTION OF THE LA AND THE NLRC
DOCTRINE
Where the claim to the principal relief sought is to be resolved not by reference to
the Labor Code or other labor relations statute or a collective bargaining agreement but
by the general civil law, the jurisdiction over the dispute belongs to the regular courts of
justice and not to the Labor Arbiter and the NLRC. In such situations, resolution of the
dispute requires expertise, not in labor management relations nor in wage structures and
other terms and conditions of employment, but rather in the application of the general
civil law. Clearly, such claims fall outside the area of competence or expertise ordinarily
ascribed to Labor Arbiters and the NLRC and the rationale for granting jurisdiction over
such claims to these agencies disappears.
FACTS
Jose Edwin G. Esico filed a complaint for constructive dismissal against
respondents Alphaland Corporation and Alphaland Development, Inc. PhilWeb initially
hired Esico as Risk & Security Management Officer on March 19, 2010. On April 19, 2010,
Alphaland concurrently engaged Esico as a rotary wing pilot assigned to fly the
Chairperson of respondents' group of companies, Roberto V. Ongpin, to his various
engagements within and outside the country. Esico signed the job offer believing that it is
the compensation package that he had asked for separately from his work as Risk &
Security Management Officer for Philweb.
In May 2011, along with 4 other pilots of Alphaland, Esico underwent flight training
in the United States of America to operate the brand new Cessna Grand Caravan 208B. On
March 3, 2012, Esico received a bond requiring him to render service to the Company for a
minimum period of 5 years in consideration of the expenses for the flight course training.
On July 3, 2012, Esico tendered his letter of resignation due the following reasons:
(a) serious embarrassments and insults had been committed against his person, honor and
reputation on several occasions by a company officer; (b) serious flight safety concerns;
(c) absence of employment contract with Alphaland Corporation; (d) absence of
helicopter recurrent training; (e) unresolved issues on services already rendered in favor
of Alphaland Corporation as fixed wing pilot from May 2, 2011 to June 2012; and (f) other
related matters.. On July 16, 2012, Esico received a letter from Alphaland demanding
payment in the amount of P977,720.00 representing the portion of his flight training
expenses.
The LA ruled that all the acts enumerated by Esico which led him to resign did not
amount to constructive dismissal. Diverging from the LA's findings, the NLRC found that
Esico was constructively dismissed by respondents Alphaland and was not paid separate
126
compensation corresponding to his two designations as RSMO and pilot under various
employment contracts. In addition, the NLRC absolved Esico of liability to reimburse
respondents for the costs of his flight training. The CA disagreed with the NLRC and found
that he voluntarily resigned from his employment. In doing so, the CA further ruled that
Esico violated the employment contract's minimum return of service clause.
ISSUE
Does LA and NLRC have jurisdiction over the case at bar.
HELD
No, the LA and the NLRC do not have jurisdiction over the case at bar. Alphaland's
claim against Esico, albeit arising out of their employer-employee relationships, is based
on our law on contracts, and thus is not cognizable by the LA and the NLRC. Labor
tribunals do not have jurisdiction to settle various issues necessitating application of our
civil law on obligations and contracts.
San Miguel Corporation v. National Labor Relations Commission illuminates, thus:

“…where the claim to the principal relief sought is to be resolved not by
reference to the Labor Code or other labor relations statute or a collective
bargaining agreement but by the general civil law, the jurisdiction over the
dispute belongs to the regular courts of justice and not to the Labor Arbiter
and the NLRC. In such situations, resolution of the dispute requires expertise,
not in labor management relations nor in wage structures and other terms and
conditions of employment, but rather in the application of the general civil
law. Clearly, such claims fall outside the area of competence or expertise
ordinarily ascribed to Labor Arbiters and the NLRC and the rationale for
granting jurisdiction over such claims to these agencies disappears.”
The bone of contention between the parties lies in the interpretation of the
employment contract, specifically the clause on the minimum service requirement in
consideration of expenses for flight training. Alphaland's cause of action, the supposed
violation of the right-duty correlative between the parties, hinges on the enforceability of
the contentious clause in the employment contract. Clearly, respondents' recourse against
Esico is based on our law on contracts.
Jurisdiction being set by law and not by the parties, the LA and the NLRC cannot
exercise jurisdiction over Alphaland's complaint just by the mere expedient of the
designation thereof as one for "wrongful resignation with claims of damages" and the
employer-employee relationship between the parties.
127
DEL MONTE LAND TRANSPORT BUS, CO. VS. ARMENTA
HERNANDO, J.
GR No. 240144 February 3, 2021
JURISDICTION AND RELIEF
DOCTRINE
If a complaint is brought before the DOLE to give effect to the labor standards
provisions of the Labor Code or other labor legislation, and there is a finding by the DOLE
that there is an existing employer-employee relationship, the DOLE exercises jurisdiction
to the exclusion of the NLRC.
If the DOLE finds that there is no employer-employee relationship, the jurisdiction

is properly with the NLRC. If a complaint is filed with the DOLE, and it is accompanied by
a claim for reinstatement, the jurisdiction is properly with the Labor Arbiter, under Art.
217 (3) of the Labor Code, which provides that the Labor Arbiter has original and
exclusive jurisdiction over those cases involving wages, rates of pay, hours of work, and
other terms and conditions of employment, if accompanied by a claim for reinstatement.
If a complaint is filed with the NLRC, and there is still an existing

employer-employee relationship, the jurisdiction is properly with the DOLE.
FACTS
Del Monte Land Transport Bus, Co., Inc. (DLTB) is a domestic corporation engaged
in the transportation business and duly registered to operate as a common carrier. It is
owned and operated by Del Monte Motor Works, Inc. (DMMWI). Following the issuance of
Order No. 118-12 (DO 118-12) on January 13, 2012 by the Department of Labor and
Employment (DOLE) which provides for the fixed and performance compensation scheme
in the computation of public utility bus driver's or conductor's wage, the DOLE issued
Labor Standards Compliance Certificates (LSCC) as Bus Transportation to DMMWI for
having complied with DO 118-12, other labor laws, rules and regulations.
Respondents are drivers and conductors who were hired by DLTB on various dates
from 2010-2013. Five months after the issuance of LSCC to DMMWI, they filed a complaint
for underpayment of wages, nonpayment of holiday pay, holiday premium, rest day
premium, service incentive leave, 13th month pay, and attorney's fees was filed by the
respondents against DLTB.
DLTB alleged that prior to the implementation of DO 118-12, respondents were

paid on a purely commission basis and when it took effect, they were being paid in
accordance with the law. It further claimed that respondents are not entitled to receive
the statutory minimum wage rates for the NCR because they are all assigned in South
Luzon and Visayas regions at the time of the institution of the complaint. Meanwhile,
respondents pointed out that the LSCCs were issued to DMMWI and not to DLTB, adding
128
that they would not have filed the complaint for money claims had there been compliance
of the mandate of DO 118-12.
DLTB then raised the issue of jurisdiction claiming that the Labor Arbiter does not
have jurisdiction to render judgment or award on the alleged underpayment of wages
claimed by the respondents since it is the DOLE which has jurisdiction over their money
claims pursuant to Article 128 of the Labor Code. The LA, in taking cognizance of the
complaint, held that respondents are entitled to their monetary claim since DLTB is
domiciled NCR, thus should be covered by the wage order issued by the Regional Tripartite
Wages and Productivity Board (RTWPB) of the NCR.
On the other hand, the NLRC reversed the findings of the LA by pointing out that it
is the DOLE-NCR who has jurisdiction over the case pursuant to the visitorial and
enforcement powers of the Secretary of Labor and Employment under Article 128 of the
Labor Code. The Court of Appeals, however, reversed the ruling of the NLRC and held that
the LA correctly took cognizance of the case because the primary cause of action of
respondents involved underpayment of wages and non-payment of other employee
benefits, hence within the jurisdiction of the LA and NLRC pursuant to Article 224 of the
Labor Code, as amended.
ISSUE
Does the LA have jurisdiction over the case involving money claims on recovery of
wage differentials.
HELD
No, the Labor Arbiter does not have jurisdiction for money claims on recovery of
wage differentials. Section 1 of DO 118-12 categorically provides that issues concerning
compliance with the minimum wages and wage-related benefits of public utility bus
drivers and conductors is conferred with DOLE-Regional Officer having jurisdiction over
the principal office of the bus owner/operator.
In the present case, the respondents challenged the certificates of compliance

issued by the DOLE Regional Officer relative to the labor standard requirements under DO
118-12, therefore it is correct to lodge it before the DOLE.
Furthermore, the issuance of RA 7730 on June 2, 1994, effectively removed the

jurisdictional limitations brought about by the threshold amount found in Articles 129 and
224 of the Labor Code insofar as the exercise of the visitorial and enforcement powers of
the DOLE Secretary are concerned. As it stands now, the authority under Article 128 may
be exercised by the DOLE regardless of the amount of the award claimed for provided
there exists an employer-employee relationship.
Therefore, the issues surrounding the money claims of respondents, as well as

questions pertaining to the Labor Standard Compliance Certificates dated February 12,
2014 raised in the instant case, are within the purview of the jurisdiction of the DOLE
pursuant to Article 128 and the provisions of DO 118-12.
129
DE JESUS VS. INTER-ORIENT
MARITIME ENTERPRISES, INC.
HERNANDO, J.
GR No. 203478 June 23, 2021
QUITCLAIM; LABOR ARBITER
DOCTRINE
In order for a deed of release, waiver or quitclaim pertaining to an existing right
to be valid, it must meet the following requirements: (1) that there was no fraud or
deceit or coercion on the part of any of the parties; (2) that the consideration for the
quitclaim is sufficient and reasonable; and (3) that the contract is not contrary to law,
public order, public policy, morals or good customs, or prejudicial to a third person with a
right recognized by law.
Art. 227. Compromise agreements. Any compromise settlement, including those

involving labor standard laws, voluntarily agreed upon by the parties with the assistance
of the Bureau or the regional office of the Department of Labor, shall be final and binding
upon the parties. The National Labor Relations Commission or any court, shall not assume
jurisdiction over issues involved therein except in case of non-compliance thereof or if
there is prima facie evidence that the settlement was obtained through fraud,
misrepresentation, or coercion.
FACTS
De Jesus exclusively worked as a seafarer on board the ocean-going vessels of
Inter-Orient Maritime Enterprises, Inc. (Inter-Orient) for 20 years for which was
consistently declared "fit for sea service" in his pre-employment medical examinations
(PEME).
While on board the vessel and was docked in the Mediterranean Sea, De Jesus felt
severe chest pains and had difficulty breathing. He was later on diagnosed with Acute
Extensive Myocardial Infarction rendering him unfit for physical work. Upon his arrival in
the Philippines, he proceeded directly to the office of Inter-Orient to inquire about his
unpaid salaries but was told that he needed to sign a Quitclaim before his salaries could
be released. Due to exhaustion and desperation brought about by his medical condition,
he signed the Quitclaim without fully understanding its consequences.
Five days later, representatives from Inter-Orient accompanied De Jesus to the

National Labor Relations Commission in Quezon City to sign a number of
Inter-Orient-prepared documents as pre-requisite for the processing and release of his
bonuses and allowances, among others, (a) NLRC-NCR Complaint form for non payment of
wages, overtime pay, vacation pay and sick leave pay docketed as NLRC NCR OFW Case
No. 06-04-011699-00 and (b) Quitclaim and Release submitted before the NLRC.
Thereafter, he received US$5,749.00 upon signing the documents. The next day, the Labor
Arbiter dismissed with prejudice the complaint in (a).
130
After nearly a year, De Jesus filed before the NLRC Regional Arbitration Branch in
Cebu a complaint for disability benefits and sickness allowance under the POEA-Standard
Employment Contract (POEA-SEC) and for moral and exemplary damages. Inter-Orient
filed a Motion to Dismiss on grounds of res judicata in view of the previous dismissal of
the similar complaint earlier filed and pointed out that De Jesus had already executed a
quitclaim and release in the said case which he executed with full consent and
comprehension. De Jesus alleged that his illness which he acquired during his employment
with Inter-Orient was compensable. Also, the Quitclaim was void since the consideration
therein was unconscionable, it was signed without the assistance of counsel and was
executed irregularly.
The Labor Arbiter denied Inter-Orient's Motion to Dismiss on the ground that De
Jesus signed the release and quitclaim without the aid of a counsel and the consideration
contained therein was unconscionable. The NLRC reversed the ruling of the LA and held
that De Jesus' illness was not work-related while the CA dismissed De Jesus’ petition.
ISSUE
Does the execution of the quitclaim by De Jesus in this case render it valid.
HELD
Yes, the quitclaim is valid. In order for a deed of release, waiver or quitclaim
pertaining to an existing right to be valid, it must meet the following requirements: (1)
that there was no fraud or deceit or coercion on the part of any of the parties; (2) that
the consideration for the quitclaim is sufficient and reasonable; and (3) that the contract
is not contrary to law, public order, public policy, morals or good customs, or prejudicial
to a third person with a right recognized by law.
In this case, De Jesus was already aware of his medical condition when he signed
the waiver as he was examined by the company-designated doctor. Moreover, there was
no proof that Inter-Orient employed fraud, malice, force or duress to compel him to sign
the quitclaim. "Lack of sleep and exhaustion," can hardly be accepted as grounds to
invalidate the waiver considering that it was signed six days after his arrival. For sure, as
a seasoned seafarer, petitioner properly considered his decision of giving up his rights
before signing the quitclaim.
Furthermore, this Court is inclined to sustain the validity of the quitclaim

considering that it was signed before the Labor Arbiter. Article 227 [233] of the Labor
Code provides:
Art. 227. Compromise agreements. Any compromise settlement, including
those involving labor standard laws, voluntarily agreed upon by the parties with
the assistance of the Bureau or the regional office of the Department of Labor,
shall be final and binding upon the parties. The National Labor Relations
Commission or any court, shall not assume jurisdiction over issues involved therein
except in case of non-compliance thereof or if there is prima facie evidence that
the settlement was obtained through fraud, misrepresentation, or coercion.
Hence, the Quitclaim being valid, it legally serves as a bar to the present claim of
petitioner for disability benefits.
131
GARCIA VS.SANTOS VENTURA HOCORMA FOUNDATION, INC.
HERNANDO, J.
LAND REGISTRATION UNDER CARP
DOCTRINE
DOJ Opinion No. 44, Series of 1990 states that all lands that have already been
classified as commercial, industrial or residential before June 15, 1988 no longer need any
conversion clearance from the DAR in order to be exempt from CARP coverage. However,
an exemption clearance from the DAR, pursuant to DAR AO No. 6, Series of 1994, is still
required to confirm or declare their exempt status.
FACTS
Santos Ventura Hocorma Foundation, Inc. (SVHFI), respondent, is the registered
owner of a parcel of land located in Barangay Cacutud, Mabalacat, Pampanga. Petitioners
are allegedly farmer-beneficiaries under the Comprehensive Agrarian Reform Program
(CARP) and recipients of Certificates of Land Ownership Award all situated in Brgy.
Cacutud, Mabalacat, Pampanga.
The issue in this case arose when the Municipal Agrarian Reform Office (MARO) of
Mabalacat, Pampanga sent a Notice of Coverage and Field Investigation to SVHFI,
informing the latter that the subject property had been identified by the Department of
Agrarian Reform (DAR) as a suitable lot for the CARP coverage under the compulsory
acquisition scheme. Consequently, CLOAs were registered and distributed to
farmer-beneficiaries covering areas of the subject property.
In its protest, SVHFI alleged that it is the absolute and registered owner of the
subject landholding, among others.
DAR Officer-in-Charge Regional Director Teofilo Q. Inocencio issued an Order

denying the letter-protest of respondent SVHFI on the ground that the subject landholding
is an agricultural land and within the coverage of CARP. Dissatisfied, SVHFI filed a motion
for reconsideration where it averred that the property is no longer devoted to or suitable
for agricultural purposes and that the property is now an expressway, given the
construction of the Subic-Clark-Tarlac expressway. However, it was denied. Later,
respondent SVHFI filed its Sworn Application for Exemption Clearance over the subject
property which was granted by then DAR Secretary Roberto Pagdanganan and ruled that
the subject property had been reclassified to purposes other than agricultural prior to
June 15, 1988 in pursuit of the provisions of DOJ 44. Petitioners appealed their case to
the Office of the President, which also denied their appeal through its Decision. Like the
DAR Secretary and OP, the CA found for respondent SVHFI and held that there is no
question that the subject landholding has been reclassified into non-agricultural uses, and
therefore, exempt from CARP coverage.
132
ISSUE
Is the subject property owned by herein respondent is exempt from CARP
coverage?
HELD
Yes, the subject property is exempt from CARP coverage. Republic Act No. (RA)
6657, or the Comprehensive Agrarian Reform Law (CARL), provides that the agrarian
reform program shall cover all public and private agricultural lands, including other lands
of the public domain suitable for agriculture. Thus, before a parcel of land can be
deemed covered by the CARP, a determination of the land's classification as either an
agricultural or non-agricultural land (e.g., industrial, residential, commercial, etc.) —
and, as a consequence, whether the said land falls under agrarian reform exemption —
must first be preliminarily threshed out before the DAR, particularly, before the DAR
Secretary in pursuant to the authority to grant or deny the issuance of exemption
clearances on the basis of Section 3 (c) of RA 6657, as amended, and DOJ Opinion No. 44,
Series of 1990.
This Court has unequivocally held that "to be exempt from CARP, all that is needed
is one valid reclassification of the land from agricultural to non-agricultural by a duly
authorized government agency before June 15, 1988, when the CARL took effect." Here,
SVHFI sufficiently proved that its property had been reclassified to non-agricultural uses,
given the number of documents it provided in support of its application for exemption
before the DAR Secretary.
It is worthy to point out that when the DAR Secretary granted SVHFI's application
for exemption, it did not mean that he was exempting the land from CARL coverage, with
the implication that the land was previously covered therein; it simply means that the
CARL itself has, from the very beginning, excluded the land from CARL coverage, and the
DAR Secretary is only affirming such fact.
Hence, given that SVHFI was able to adequately show that the subject property
had been validly reclassified prior to June 15, 1988, the DAR Secretary correctly granted
the application for exemption of respondent SVHFI.
133
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
LABOR LAW
doctrines
LABOR LAW
Fundamental Principles and Concepts
PEOPLE V. IMPERIO Y ANTONIO
G.R. NO. 232623 | OCTOBER 5, 2020
BURDEN OF PROOF AND QUANTUM OF EVIDENCE IN ILLEGAL RECRUITMENT CASES
SUMMARY & DOCTRINE

An Information for Illegal Recruitment in Large Scale under Republic Act No. (RA)
8042, otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995" was
filed against Oliver Imperio y Antonio (appellant). All the elements of Illegal Recruitment
in Large Scale are present in the instant case.
DOCTRINE: In illegal recruitment cases, receipt of payment as evidence of profit is

not material. Article 13 (b) of the Labor Code states that the act of recruitment may be
for profit or not. It suffices that appellant promised or offered employment for a fee to
the complaining witnesses to warrant his conviction for illegal recruitment. More so where
the respective testimonies of the complainants clearly narrated the accused's involvement
in illegal recruitment activities.
NOTE
Under RA 8042, a non-licensee or non-holder of authority is liable for Illegal
Recruitment when the following elements concur: (1) the offender has no valid license or
authority required by law to enable him to lawfully engage in recruitment and placement
of workers; and (2) the offender undertakes any of the activities within the meaning of
"recruitment and placement" under Article 13(b) of the Labor Code, or any of the
prohibited practices enumerated under Article 34 of the Labor Code (now Section 6 of RA
8042). In the case of Illegal Recruitment in Large Scale, a third element is added: that the
offender commits any of the acts of recruitment and placement against three or more
persons, individually or as a group.
Pre-Employment: Illegal Recruitment

PEOPLE V. MANALANG
G.R. NO. 198015 | JANUARY 20, 2021
SUMMARY & DOCTRINE

Accused-appellant Avelina Manalang a.k.a. Tess Robles, a.k.a. Alvina Manalang
(Manalang) was charged with Illegal Recruitment in Large Scale in violation of Section 6(1)
and (m) of Republic Act No. 8042 (RA 8042), otherwise known as the Migrant Workers and
Overseas Filipino Act of 1995, and Estafa under Article 315(2) of the Revised Penal Code
(RPC). The Court finds that the elements for the crime of Illegal Recruitment in Large
Scale were sufficiently established in the instant case.
135
DOCTRINE: Illegal recruitment is deemed committed by a syndicate if carried out
by a group of three (3) or more persons conspiring or confederating with one another. It is
deemed committed in large scale if committed against three (3) or more persons
individually or as a group. The persons liable for the above offenses are the principals,
accomplices and accessories. In case of juridical persons, the officers having control,
management or direction of their business shall be liable.
Under RA 8042, a non-licensee or non-holder of authority commits illegal

recruitment for overseas employment in two ways: (1) by any act of canvassing, enlisting,
contracting, transporting, utilizing, hiring, or procuring workers, and includes referring,
contract services, promising or advertising for employment abroad, whether for profit or
not; and (2) by undertaking any of the acts enumerated under Section 6 of RA 8042. On
the other hand, a licensee or holder of authority is also liable for illegal recruitment for
overseas employment when he or she undertakes any of the thirteen acts or practices [(a)
to (m)] listed under Section 6 of RA 8042. To constitute illegal recruitment in large scale,
the offense of illegal recruitment must be committed against three or more persons,
individually or as a group. Moreover, it is settled that a person, for the same acts, may be
convicted separately for Illegal Recruitment under RA 8042 (or the Labor Code), and
Estafa under Article 315(2)(a) of the RPC.
NOTE
RA 8042 increased the penalties for Illegal Recruitment in Large Scale as follows:
SEC. 7. Penalties. —
(a) Any person found guilty of illegal recruitment shall suffer the penalty of
imprisonment of not less than six (6) years and one (1) day but not more than twelve (12)
years and a fine of not less than Two hundred thousand pesos (P200,000.00) nor more than
Five hundred thousand pesos (P500,000.00).
(b) The penalty of life imprisonment and a fine of not less than Five hundred
thousand pesos (P500.000.00) nor more than One million pesos (P1,000,000.00) shall be
imposed if illegal recruitment constitutes economic sabotage as defined herein.
Provided, however, That the maximum penalty shall be imposed if the person
illegally recruited is less than eighteen (18) years of age or committed by a non-licensee
or non-holder of authority.
To recall, the RTC imposed a penalty of life imprisonment and a fine of

P500,000.00 against Manalang,75 which was affirmed by the appellate court. Since in this
case, the crime of Illegal Recruitment in Large Scale is considered as an offense involving
economic sabotage and committed by a non-licensee or non-holder of authority, there is a
need to increase the fine imposed from P500,000.00 to P1,000,000,00.
136
PEOPLE V. LIWANAG
G.R. NO. 232245 | MARCH 2, 2022
SUMMARY & DOCTRINE

Mildred Coching Liwanag (accused-appellant) was charged with several
Informations for Illegal Recruitment in Large-Scale and Estafa.
DOCTRINE: It is settled that a person, for the same acts, may be convicted
separately of Illegal Recruitment under RA 8042 or the Labor Code, and Estafa under
Article 315 (2) (a) of the RPC. Case law holds that the same pieces of evidence that
establish liability for Illegal Recruitment in Large Scale confirm culpability for Estafa.
Employment Proper: Social Welfare Legislation

NAGAÑO V. TANJANGCO
G.R. NO. 204218 | MAY 12, 2021
SOCIAL LEGISLATION; COVERAGE FOR THE APPLICATION FOR RETENTION
SUMMARY & DOCTRINE

The subject property was granted an emancipation patent by virtue of PD 27 in
favor of the tenant-beneficiaries. The 144-hectare of it was allocated to the respondents
however, the respondent filed an application for retention of 5 hectares each of them
under CARP.
DOCTRINE: Under the Presidential Decree No. 27, the emancipation of all tenant
farmers of rice or corn lands under the land transfer program of the government. A
covered landowner was allowed to retain an area of not more than seven (7) hectares if
his/her tenanted rice or corn lands do not exceed 24 hectares.
137
SILVA V. LO
G.R. NO. 206667 |JUNE 23, 2021
SOCIAL LEGISLATION; COMPREHENSIVE AGRARIAN REFORM LAW; TENANTS AS PARTIES IN A PARTITION
CASE
SUMMARY & DOCTRINE

An Extrajudicial Settlement of Estate which provides that all properties of the
decedent shall be owned in common, pro indiviso by the heirs and a Memorandum of
Agreement for the physical division of the estate was executed but these were never
implemented. The heirs negotiated for a New Agreement and New Subdivision Plan of
certain agricultural properties, including the subject property, but not all the parties
signed.
DOCTRINE: The Rule 69 of the Rules of Court have laid down two phases of an
action for partition: first, the trial court, after determining that a co-ownership in fact
exists and that partition is proper, issues an order for partition; and, second, the trial
court promulgates a decision confirming the sketch and subdivision of the properties
submitted by the parties (if the parties reach an agreement) or by the appointed
commissioners (if the parties fail to agree), as the case may be.
NOTE
Section 2, Rule 69 of the Rules of Court on Partition provides that, if after the trial
the court finds that the plaintiff has the right thereto, it shall order the partition of the
real estate among all the parties in interest. Thereupon the parties may, if they are able
to agree, make the partition among themselves by proper instruments of conveyance, and
the court shall confirm the partition so agreed upon by all the parties, and such partition,
together with the order of the court confirming the same, shall be recorded in the
registry of deeds of the place in which the property is situated. A final order decreeing
partition and accounting may be appealed by any party aggrieved thereby.
DY BUNCIO V. RAMOS
G.R. NO. 206120 | MARCH 23, 2022
SOCIAL LEGISLATION; JURISDICTION OF THE DARAB; EXISTENCE OF TENANCY RELATIONSHIP
SUMMARY & DOCTRINE

Buncio claimed to be a registered co-owner of a parcel of land and that the
respondents are unlawful and unauthorized possessor of such. Respondents asserted that
the RTC had no jurisdiction over the subject matter because there existed a leasehold
agreement between them and the parents of the registered owners of the land.
138
DOCTRINE: Under Section 1 (1.1) of Rule II of the DARAB 2003, the Adjudicator
shall have primary and exclusive original jurisdiction to determine and adjudicate the
rights and obligations of persons, whether natural or juridical, engaged in the
management, cultivation, and use of all agricultural lands covered by Republic Act (RA)
No. 6657, otherwise known as the Comprehensive Agrarian Reform Law (CARL), and other
related agrarian laws.

NOTE
All the foregoing requisites are necessary to create a tenancy relationship, and the
absence of one or more requisites will not make the alleged tenant a de facto tenant. In
Macalanda, Jr. v. Acosta, the Court emphasized that, "crucial for the creation of tenancy
relations would be the existence of two of the essential elements, namely, consent and
sharing and/or payment of lease rentals.
HEIRS OFDE LARA, SR. V. RURAL BANK OF JAEN, INC.

G.R. NO. 212012 | MARCH 28, 2022
SOCIAL LEGISLATION; JURISDICTION OF DARAB
SUMMARY & DOCTRINE

A parcel of land awarded to farmer beneficiary under PD 27 and subsequently
mortgaged to a financial institution during the prohibitory period is void ab initio as
provided for under Sec. 27 of RA 6657, otherwise known as CARP. When the same parcel of
land was nonetheless mortgaged, the DARAB does not have jurisdiction over the case
because tenancy does not exist between the farmer beneficiary and the financial
institution.
DOCTRINE: Rule II of the 2003 DARAB Rules of Procedure provides that the
Adjudicator has the primary and exclusive jurisdiction over cases involving correction,
partition, cancellation, secondary and subsequent issuances of CLOAs and EPs which are
registered with the Land Registration Authority. The DARAB, on the other hand, has
exclusive appellate jurisdiction to review, reverse, modify, alter, or affirm resolutions,
orders, and decisions of its Adjudicators.” There should be a tenancy relationship
between the parties for DARAB to acquire jurisdiction which is not present on the instant
case.
139
The tenancy relationship between the parties must exist for the DARAB to acquire
jurisdiction. The following indispensable elements should therefore first be established:
(1) that the parties are the landowner and the tenant or agricultural lessee; (2) that the
subject matter of the relationship is an agricultural land; (3) that there is consent
between the parties to the relationship; (4) that the purpose of the relationship is to
bring about agricultural production; (5) that there is personal cultivation on the part of
the tenant or agricultural lessee; and (6) that the harvest is shared between the
landowner and the tenant or agricultural lessee. These elements have not been satisfied
in the present case.
NOTE
There was no tenancy relationship between petitioner and respondent bank over
the subject land. Neither did they have any leasehold or agrarian relations when the
respondent bank filed its petition with the DARAB. In fact, the respondent bank did not
allege in its petition that such a relationship exists between them. What is crystal clear in
the instant case is that respondent bank's petition for cancellation of certificate of title
stemmed from the subject land's foreclosure. There was therefore no agrarian dispute
notwithstanding the fact that the land involved is an agricultural land. Thus, respondent's
petition should have been dismissed by the DARAB for lack of jurisdiction.
PHILIPPINE TRANSMARINE CARRIERS, INC. V. SAN JUAN

G.R. NO. 207511 | OCTOBER 5, 2020
DISABILITY BENEFITS
SUMMARY & DOCTRINE

San Juan a Chief Cook hired by PTCI claims recovery of permanent total disability
benefits,medical expenses, compensatory, moral, and exemplary damages, and attorney's
fees filed by San Juan against petitioners Philippine Transmarine Carriers, Inc. (PTCI),
General Maritime Management LLC, and Carlos C. Salinas (Salinas), president and/or local
manager of PTCI. However San Juan failed to prove that substantial evidence of a causal
connection between his illness and the work for which he had been contracted to perform
exists. Furthermore he has been cleared to be “fit to work” within the prescribed period
on or before 120 days by the company physicians which should be given credence with his
diagnosis considering the extensive medical laboratories and tests on which he underwent
prior to submission of fit to work clearance. Non rehiring does not conclude that he is
unfit to work because such is a management prerogative granted expressly within the
company’s discretion being the nature of his contract to be contractual.
DOCTRINE: Pursuant of the Labor Code permanent total disability has the
following prescribed rules; Art. 192 Permanent Disability: the following disabilities shall
be deemed total and permanent: 1. Temporary total disability lasting continuously for
140
more than 120 days except as otherwise provided in the Rules. Art. 192 c. 1 Sec 2 Period
of Entitlement
(a) The income benefit shall be paid beginning on the first day of such
disability. If caused by an injury or sickness it shall not be paid longer than 120
consecutive days except where such injury or sickness still requires medical
attendance beyond 120 days but not exceeding 240 days from onset of
disability shall be paid. However, the system may declare the total and
permanent status at any time after 120 days of continuous temporary total
disability as may be warranted by the degree of actual loss or impairment of
physical or mental functions as determined by the System. Furthermore Sec. 20
B 3 of 2000 POEA-SEC also provides that: 3. Upon sign-off from the vessel for
medical treatment, the seafarer is entitled to sickness allowance equivalent to
his basic wage until he is declared fit to work or the degree of permanent
disability has been assessed by the company-designated physician but in no
case shall this period exceed 120 days.
NOTE
However, the court ruled that he is entitled to receive additional sickness
allowance of eight more days, because his sickness allowance is computed from the time
he signed off from the medical treatment until he is declared medically fit to work or his
final medical disability has been assessed by the company designated physician. In this
case, it is undisputed that the San Juan signed off from the vessel on Jan 23, 2010 and
was declared fit to work on April 20, 2010 by the company-designate physicians, or after
an interval of 97 days. Considering San Juan was paid his sickness allowance for only 89
days. Moreover, the additional sickness allowance shall earn interest at the rate of six
percent (6%) per annum from the date of finality of this Decision until fully paid.
SINGSON V. ARKTIS MARITIME CORP.

G.R. NO. 214542 | JANUARY 13, 2021
DISABILITY BENEFITS; TOTAL AND PERMANENT DISABILITY
SUMMARY & DOCTRINE

Ronnie, a third engineer hired by Fil-Pride Shipping Co., on behalf of a foreign
principal, respondent Prosper Marine Private Ltd. on board “M/T Atlanta 2” for a period of
10 months, seeks to set aside the resolution of CA denying him of claim for permanent
and total disability benefits. The appellate court as stated by the SC did not commit any
error of law when it ruled that petitioner is not entitled to total and permanent disability
benefits but only temporary disability benefits until the time he was declared fit to work
by the company physician.
DOCTRINE: When a certain sickness or injury causes a temporary and total

disability which lasts continuously for more than 120 days, then such total disability is
considered to be permanent. However, as an exception to this rule, if the said sickness or
141
injury that caused the temporary total disability requires medical treatment beyond the
120-day period but not to exceed 240 days, then the employee is only entitled to
temporary total disability benefits until he is declared as either: 1) "fit to work," which
stops his entitlement to disability benefits; or 2) "permanently and totally disabled,"
which then entitles him to permanent total disability benefits. In any event, if the 240
days had lapsed without any certification issued by the company-designated doctor, then
the employee may pursue an action for permanent total disability benefits.
IDUL V. ALSTER INT'L. SHIPPING SERVICES, INC.

G.R. NO. 209907 | JUNE 23, 2021
DISABILITY BENEFITS; COMPANY PHYSICIANS AND PHYSICIANS SELECTED BY EMPLOYEES THEMSELVES
SUMMARY & DOCTRINE

Charlo Idul figured in an accident and filed a complaint for total and permanent
disability benefits but was not entitled to the same because the doctor’s assessment of
the disability was well within the 240-day period and it did not become a total and
permanent disability just by the mere lapse of 120-day period, especially since the
extension was necessary for his rehabilitation.
DOCTRINE: A temporary total disability only becomes permanent when 1) the

company-designated physician declares it to be so within the 240-day period; or 2) when
after the lapse of the 240-day period, the company-designated physician fails to make
such declaration.
NOTE
POEA [SEC] and by applicable Philippine laws. If the 120 days initial period is exceeded
and no such declaration is made because the seafarer requires further medical attention,
then the temporary total disability period may be extended up to a maximum of 240 days,
subject to the right of the employer to declare within this period that a permanent partial
or total disability already exists. The seaman may of course also be declared fit to work at
any time such declaration is justified by his medical condition.
142
MABALOT V. MAERSK-FILIPINAS CREWING, INC.
G.R. NO. 224344 |SEPTEMBER 13, 2021
DISABILITY BENEFITS
SUMMARY & DOCTRINE

Edgardo Mabalot, suffering from “Frozen Shoulder”, filed a complaint for total and
permanent disability benefits but was not entitled to the same because the Grade 11
disability rating was merely an interim diagnosis and cannot be considered as a definite
and final assessment in which case, the company-designated doctor still had a remaining
period within which to give his definitive assessment on the seafarer’s medical condition
or fitness to return to work.
DOCTRINE: The assessment to be conclusive must be complete and definite;

otherwise, the medical report shall be set aside and the disability grading contained
therein shall be ignored. As case law holds, a final and definite disability assessment is
necessary in order to truly reflect the true extent of the sickness or injuries of the
seafarer and his or her capacity to resume work as such.
NOTE
A ruling of the NLRC can still be the subject of review by the CA through a special
civil action for certiorari under Rule 65 of the Rules of Court. While there is no law stating
that an aggrieved party before the NLRC may file an appeal before the CA, the same does
not mean that an NLRC decision can no longer be assailed.
RODRIGUEZ V. PHILIPPINE TRANSMARINE CARRIERS, INC.

G.R. NO. 218311 | OCTOBER 11, 2021
PERMANENT TOTAL DISABILITY OF LABORERS; PERIOD OF ENTITLEMENT; OBLIGATIONS OF EMPLOYER;
REPATRIATION OF SEAFARERS
SUMMARY & DOCTRINE

Edgar Rodriguez filed a complaint for permanent and total disability benefits.
However, the court found Dr. Lim’s assessment as sufficient justification to extend the
seafarer's medical treatment beyond the 120-day period, since the latter still had to
undergo further treatment and evaluation in view of his persistent back problems. Since
Dr. Lim’s final medical assessment was justifiably issued beyond the 120-day period but
within 240 days from the time Rodriguez first reported to him, the Court found Rodriguez
not entitled to his claim for permanent and total disability benefits.
DOCTRINE: A claim for permanent and total disability benefits may prosper after
the lapse of the 120-day period, but less than 240 days, from the time the seafarer
143
reported for medical treatment if the company-designated physician failed to declare
within the 120-day period that the seafarer requires further medical attention.
NOTE
Medical Within 120-day More than 120 days, More than 240 days
Treatment period but less than 240 days
Period
May a seafarer
YES YES NO YES
avail of
permanent and
total disability
Requisite: The In any of the In any of the Thus, if after the
benefits for a
company-designated following instances: following lapse of 240 days,
work-related
physician issued a instances: and the
injury? a. No justification
final and definitive company-designate
from the a. The lapse of
medical assessment d physician has not
company-designa 120 days was
on the seafarer's made any
ted physician caused by
permanent and assessment, then
during the 120 seafarer's fault
total disability. "the finding of
days to extend (i.e.,
permanent and
period of indifference to
total disability
treatment; or treatment /
becomes
b. ."the uncooperative
conclusive."
company-designa seafarer /
ted physician medical
declared that abandonment);
[the seafarer] is or
fit for sea duty b. The
within the company-desig
120-day or nated physician
240-day period, gave an
as the case may assessment
be but his within the
physician of 120-day period
choice and the that the
doctor chosen seafarer
under Section required
20-B (3) of the further medical
POEA-SEC are of treatment.
a contrary
opinion."
144
DARROCA, JR. V. CENTURY MARITIME AGENCIES, INC.
G.R. NO. 234392 | NOVEMBER 10, 2021
COMPENSABLE DISABILITY; WORK-RELATED ILLNESS
SUMMARY & DOCTRINE

Efraim Darroca filed a complaint for the payment of his permanent and total
disability benefits as he was diagnosed with major depression and psychomotor
retardation. However, the Court dismissed his petition as he failed to establish that his
illness is work-related and compensable.
DOCTRINE: For disability to be compensable, two elements must concur: (1) the
injury or illness must be work-related; and (2) the work-related injury or illness must have
existed during the term of the seafarer's employment contract. It is not sufficient to
establish that the seafarer's illness or injury has rendered him permanently or partially
disabled; it must also be shown that there is a causal connection between the seafarer's
illness or injury and the work for which he had been contracted.
MARLOW NAVIGATION PHILS. V. HEIRS OF BEATO

G.R. NO. 233897 | MARCH 9, 2022
DISABILITY BENEFITS
SUMMARY & DOCTRINE

Antonio Beato was an Able Seaman for Marlow Navigation, he died due to cardio
respiratory failure with underlying cause of pancreatic cancer. His heirs filed a complaint
for death benefits, reimbursement of medical expenses and damages on the ground that
the cause of death of Antonio is a work-related illness.The Court dismissed their petition
as they failed to prove that Antonio ‘s illness is compensable as he failed to satisfy all the
conditions under Section 32-A of the 2010 POEA-SEC.
DOCTRINE: In order for a seafarer to be entitled to the compensation and benefits

under Section 20-A, the disability causing the illness, injury or death must be one of those
listed under Section 32. Antonio failed to prove that his illness is compensable as he failed
to satisfy all the conditions under Section 32-A which are, to repeat:
2. The disease was contracted as a result of the seafarer's exposure to the described
risks;
145
The referral to a third doctor has been recognized by this Court to be a mandatory
While the Supreme Court adheres to the principle of liberality in favor of the
seafarer in construing the POEA-SEC, it cannot allow claims for disability compensation
based on surmises. Liberal construction is never a license to disregard the evidence on
record and to misapply the law.
PAGLINAWAN V. DOHLE PHILMAN AGENCY, INC.

G.R. NO. 230735 | APRIL 4, 2022
ENTITLEMENT TO DISABILITY BENEFITS
SUMMARY & DOCTRINE

Edgardo M. Paglinawan, an engine and deck fitter for Dohle, was diagnosed with
lower gastrointestinal bleeding secondary to ulcerative colitis. He filed for a permanent
total disability compensation, however, the Court dismissed his petition as there is no
evidence of the link or relatedness between the illness and his work.
DOCTRINE: The seafarer must prove by substantial evidence that "there is a

reasonable causal connection between his illness and the work for which he has been
contracted." It is settled that awards of disability compensation cannot be based on mere
general averments or speculations. Section 20 (A) of the 2010 POEA-SEC provides that for
an illness to be compensable, two elements must concur: (a) the injury or illness must be
work-related; and, (b) the work-related injury or illness must have existed during the
term of the seafarer's employment contract. The first element is the one in contention in
this case.
Section 32-A provides for the conditions of compensability for listed occupational
diseases: (a) the seafarer's work must involve risks described therein; (b) the disease was
contracted as a result of the seafarer's exposure to the described risks; (c) the disease
was contracted within a period of exposure and under such other factors necessary to
contract it; and, (d) there was no notorious negligence on the part of the seafarer. The
seafarer must prove by substantial evidence that "there is a reasonable causal connection
between his illness and the work for which he has been contracted." Case law teaches
that these conditions apply to those illnesses not listed as an occupational disease in the
2010 POEA-SEC.
146
VILLE V. MAERSK-FILIPINAS CREWING, INC.
G.R. NO. 217879 | FEBRUARY 1, 2021
SUMMARY & DOCTRINE

Manning agency Maersk hired Ville as Chief Cook on board the ship Adrian Maersk
for a period of six months. Before his deployment, Ville underwent a Pre-Employment
Medical Examination (PEME) wherein he was declared as fit for work. Upon the expiration
of his contract, Ville disembarked from the vessel. Upon his arrival in the Philippines, he
did not report that he was experiencing any illness or injury while on board Adrian
Maersk. Ville underwent another PEME as a prerequisite for another deployment. The
results of the PEME indicated that he was "Unfit for Sea Duty." Under the impression that
he contracted the illness while on board Adrian Maersk, Ville filed a Complaint against the
respondents for reimbursement of medical expenses and sickness allowance, payment of
total and permanent disability benefits, moral and exemplary damages, attorney's fees
plus legal interest.
DOCTRINE: The seafarer shall submit himself to a post-employment medical

examination by a company-designated physician within three working days upon his return
except when he is physically incapacitated to do so. Non-compliance with the
post-employment medical examination requirement is tantamount to a waiver or
forfeiture of any right to claim disability benefits.
C.F. SHARP CREW MANAGEMENT V. JAICTEN

G.R. NO. 208981 | FEBRUARY 1, 2021
SUMMARY & DOCTRINE

In his complaint for disability benefits, moral damages, exemplary damages and
attorney's fees, Jaicten alleged that he was employed by C.F. Sharp, for and on behalf of
its foreign principal JFTL, on board M/V Cumbrian Fisher. He was declared fit to work
during his pre-employment medical examination. Thereafter, he suffered chest pains
which lasted for two days where he was diagnosed with non-ST myocardial infarction. He
was then declared unfit to work. Petitioners argued that respondent is not entitled to
permanent and total disability benefits.
DOCTRINE: In case of disagreement between the findings of the

company-designated physician and the seafarer's doctor of choice, both parties may agree
to jointly refer the matter to a third doctor whose decision shall be final and binding on
them. Moreover, the signing of the Certificate of Fitness to Work effectively released
petitioners from any liability.
147
DESTRIZA V. FAIR SHIPPING CORPORATION
DISABILITY BENEFITS
SUMMARY & DOCTRINE

Florencio B. Destriza, petitioner, filed a complaint for permanent disability
benefits, sickness allowance, medical reimbursement, compensatory, moral, and
exemplary damages, and attorney's fees before the National Conciliation and Mediation
Board (NCMB) against FSC, Cachapero and Boseline, respondents.
DOCTRINE: For an illness to be compensable, it is not necessary that the nature

of the employment be the sole and only reason for the illness suffered by the seafarer. It
is enough that there is "a reasonable linkage between the disease suffered by the
employee and his work to lead a rational mind to conclude that his work may have
contributed to the establishment or, at the very least, aggravation of any pre-existing
condition he might have had." The disputable presumption implies "that the non-inclusion
in the list of compensable diseases/illnesses does not translate to an absolute exclusion
from disability benefits." Similarly, "the disputable presumption does not signify an
automatic grant of compensation and/or benefits claim." It is still necessary for the
claimant to establish, through substantial evidence, that his illness is work-related.
Post-Employment: Kinds of Employment

SRL INTERNATIONAL MANPOWER AGENCY V. YARZA, JR.
G.R. NO. 207828 | FEBRUARY 14, 2022
VALIDITY OF OFFER OF EMPLOYMENT; EMPLOYER-EMPLOYEE RELATIONSHIP; VALID TERMINATION OF
EMPLOYMENT
SUMMARY & DOCTRINE

Respondent Pedro S. Yarza, Jr. alleged that the petitioners SRL International
Manpower Agency and Akkila Co. Ltd. UAE, SRL's foreign principal, hired him as a Project
Manager for a duration of two years. Yarza was repatriated to the Philippines. Although
Yarza complied with all the requirements, petitioners terminated his employment without
prior notice and due process. Yarza filed a complaint for illegal dismissal, payment of
salary for the unexpired portion of his contract, refund of transportation fare, and moral
damages against the petitioners.
DOCTRINE: To be considered valid, the dismissal on the ground of disease must

satisfy two requisites: "(a) the employee suffers from a disease which cannot be cured
within six months and his/her continued employment is prohibited by law or prejudicial to
148
his/her health or to the health of his/her co-employees, and (b) a certification to that
effect must be issued by a competent public health authority."
GINTA-ASON V. J.T.A. PACKAGING CORP.

G.R. NO. 244206| MARCH 16, 2022
EMPLOYER-EMPLOYEE RELATIONSHIP
SUMMARY & DOCTRINE

Petitioner Gerome B. Ginta-Ason filed a complaint against JTA (Respondent) for
illegal dismissal, non-payment of salary/wages/etc, due to the fact that he was
constructively dismissed because Arquilla made his continued employment impossible,
unbearable, and unlikely. Thus, he claimed that as an employee of JTA therefore he is
entitled to those abovementioned.
DOCTRINE: Applying the "four-fold test" in determining the existence of an
employer-employee relationship, to wit: (a) the selection and engagement of the
employee; (b) the payment of wages; (c) the power of dismissal; and (d) the power to
control the employee's conduct, the NLRC, as affirmed by the CA, found that Ginta-Ason
failed to prove, by competent and relevant evidence that he is an employee of JTA.
JOVERO V. CERIO
G.R. NO. 202466 | JUNE 23, 2021
TEST TO DETERMINE WHETHER AN EMPLOYEE IS A PROJECT EMPLOYEE ONLY
SUMMARY & DOCTRINE

Respondents Rogelio Cerio, et al (Cerio, et al). were hired on various dates by
Sigma Construction and Supply. They argued that they were illegally dismissed due to the
fact that they were not just project employees because they were continuously hired and
149
assigned to different PGI projects from the beginning of their employment in 1990 until
their recent termination in 1993.
DOCTRINE: The principal test in determining whether an employee is a project

employee is whether he/she is assigned to carry out a "specific project or undertaking,"
the duration and scope of which are specified at the time the employee is engaged in the
project, or where the work or service to be performed is seasonal in nature and the
employment is for the duration of the season. A true project employee should be assigned
to a project which begins and ends at determined or determinable times, and be informed
thereof at the time of hiring.
ENGINEERING & CONSTRUCTION CORPORATION OF ASIA V. PALLE

G.R. NO. 201247 | JULY 13, 2020
PROJECT EMPLOYEES
SUMMARY & DOCTRINE

Respondents Palle, et al. filed a complaint for illegal dismissal against Respondent
ECCA, alleging that they were regular employees of the company. ECCA argued that Palle,
et al, as project employees, were validly terminated in view of the project's completion
since they were hired for a specific project or undertaking, the termination of which was
determined at the time they were hired.
DOCTRINE: In Lopez v. Irvine Construction Corp., it was held that the principal test
for determining whether particular employees are properly characterized as 'project
NOTE
Article 295 [280] of the Labor Code provides the definition of regular and project
employees.
ARTICLE 295. [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 service 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
150
considered a regular employee with respect to the activity in which he is
employed and his employment shall continue while such activity exists.
Thus, based on the foregoing provisions, an employment is generally deemed

regular where: (i) the employee has been engaged to perform activities which are usually
hired, and the employment of such employee remains while such activity exists.
On the other hand, a project employee “is one whose 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.” Thus, the “services of
project-based employees are coterminous with the project and may be terminated upon
the end or completion of the project or a phase thereof for which they were hired.”
V PEOPLE MANPOWER PHILS., INC. V. BUQUID

G.R. NO. 222311 | FEBRUARY 10, 2021
SEAFARER; DISABILITY BENEFITS
SUMMARY & DOCTRINE

Petitioner V People Manpower Phils., Inc. hired Dominador, for and on behalf of its
principal, Cape Papua New Guinea Ltd. as a Deck Crew/Rigger. Before his deployment,
Dominador underwent and passed the routine Pre-employment Medical Examination
(PEME). He commenced his work at the KUMUL Project site. He then felt persistent
stomach pains. Dominador's condition did not improve, prompting him to consult Dr.
Peneyra for a second opinion. Dr. Peneyra issued several medical abstracts which stated
that Dominador's illness was occupation related/aggravated and that he was permanently
unfit for sea duties as a seaman in any capacity. Dominador initiated a claim for disability
benefits with petitioners, pursuant to the Philippine Overseas Employment Administration
(POEA) Standard Employment Contract (POEASEC). However, his claim was denied.
DOCTRINE: In order to be considered a seaman or seafarer, one would have to be,

at the very least, employed in a vessel engaged in maritime navigation. Thus, it is clear
that those employed in non-mobile vessels or fixed structures, even if the said
vessels/structures are located offshore or in the middle of the sea, cannot be considered
as seafarers under the law.
An overseas employee, in order to be considered as a "seafarer," must not only

perform tasks concerning manning marine vessels or marine navigation, but they must
also perform such functions onboard a vessel engaged in maritime navigation or a mobile
offshore rig or drilling unit in the high seas.
151
CABATAN V. SOUTHEAST ASIA SHIPPING CORP.
G.R. NO. 219495 | FEBRUARY 28, 2022
2000 AMENDED STANDARD TERMS AND CONDITIONS GOVERNING THE OVERSEAS EMPLOYMENT OF
FILIPINO SEAFARERS ON-BOARD OCEAN-GOING SHIPS
SUMMARY & DOCTRINE

Petitioner Reynaldo P. Cabatan was employed as an oiler by Southeast Asia
Shipping Corp. (SEASCORP) on behalf of its principal, Maritime Management Services
(Maritime Management). Before deployment, he underwent his Pre-Employment Medical
Examination (PEME) and was certified to be fit for sea duty. After which, he boarded M/V
BP Pioneer under a three-month contract. While on a 12 hour duty, he was carrying spare
parts along with a heavy connecting rod when the vessel suddenly swayed due to the big
waves which caused him to bend and nearly fall to his knees causing him excruciating pain
in his scrotal/inguinal area.
DOCTRINE: In order to claim compensability under the forgoing section, it is

required that the seafarer must have: (1) suffered a work-related illness or injury during
the term of his contract; and (2) submitted himself to a mandatory post-employment
medical examination within three (3) working days upon his arrival. The rationale behind
the rule can easily be divined. Within three days from repatriation, it would be fairly easy
for a physician to determine if the illness was work-related or not. After that period,
there would be difficulty in ascertaining the real cause of the illness.
NOTE
PALGAN V. HOLY NAME UNIVERSITY

G.R. NO. 219916 | FEBRUARY 10, 2021
GOVERNING LAW FOR THE EMPLOYMENT STATUS OF TEACHERS/PROFESSORS/INSTRUCTORS
SUMMARY & DOCTRINE

Petitioner Arlene Palgan filed a complaint for illegal dismissal against Holy Name
University (HNU). She alleged that even though she was already a regular employee, HNU
did not renew her contract of employment without due process.
152
DOCTRINE: The governing law for the employment status of
teachers/professors/instructors are the manuals of regulations for private schools. The
Manual of Regulations for Private Schools and not the Labor Code determines whether or
not a faculty member in a private educational institution has attained a permanent or
regular status.
The Supreme Court has laid down in Lacuesta the following requisites before a
private school teacher acquires permanent status, namely: 1) The teacher serves
full-time; 2) he/she must have rendered three consecutive years of service; and 3) such
service must have been satisfactory.
1. The fixed period of employment was knowingly and voluntarily agreed upon by
the parties without any force, duress, or improper pressure being brought to bear upon
the employee and absent any other circumstances vitiating his consent; or
2. It satisfactorily appears that the employer and the employee dealt with each
other on more or less equal terms with no moral dominance exercised by the former or
the latter.

Post-Employment: Termination of Employment by Employer

UNIVERSITY OF THE CORDILLERAS VS. LACANARIA
G.R. NO. 223665 | SEPTEMBER 27, 2021
DUE PROCESS UNDER THE LABOR CODE; TOTALITY OF INFRACTIONS RULE; MANAGEMENT
PREROGATIVE; EXPERTISE OF LABOR TRIBUNALS; INTENT TO RESIGN AND PREVENTIVE SUSPENSION
SUMMARY & DOCTRINE

Lacanaria, a professor at University of the Cordilleras was terminated due to his
unprofessionalism in conversing and dealing with his students.
DOCTRINE: The totality of infractions or the number of violations committed

during the period of employment shall be considered in determining the penalty to be
imposed upon an erring employee. Actual hearing or conference is not a condition sine
qua non for procedural due process in labor cases but formal hearing or conference
becomes mandatory only when requested by the employee in writing or substantial
153
evidentiary disputes exist or a company rule or practice requires it, or when similar
circumstances justify it.
Preventive suspension is not a penalty but a disciplinary measure to protect life or

property of the employer or the co-workers pending investigation of any alleged infraction
committed by the employee. Thus, it is justified only when the employee's continued
employment poses a serious and imminent threat to the employers or coworkers' life or
property. When justified, the preventively suspended employee is not entitled to the
payment of his salaries and benefits for the period of suspension.
VILLOLA V. UNITED PHILIPPINE LINES, INC.

G.R. NO. 230047 | OCTOBER 9, 2019
TERMINATION OF EMPLOYMENT; RESIGNATION; PRINCIPLE OF ESTOPPEL
SUMMARY & DOCTRINE

Villola was employed by UPL as its IT and Communications Manager, however, he
was later on made to voluntarily cease his employment with UPL and formalize the same,
but he failed to do so. He then stopped reporting for work, but proposed a scanning
project under the name of another company, hence his complaint for illegal dismissal.
DOCTRINE: Resignation is defined as a formal pronouncement or relinquishment of

an office, with the intention of relinquishing the office accompanied by the act of
relinquishment. The fact of resignation is therefore supported by the concurrence of the
following: (1) the intent to relinquish one's office; and (2) the overt act of relinquishment.
Moreover, The principle of estoppel rests on this rule: "Whenever a party has, by his own
declaration, act or omission, intentionally and deliberately led another to believe a
particular thing [to be] true, and to act upon such belief, he cannot, in any litigation
arising out of such declaration, act, or omission, be permitted to falsify it."
154
LUFTHANSA TECHNIK PHILIPPINES, INC. V. CUIZON G.R. NO.
184452 | FEBRUARY 12, 2020
DISMISSAL ON THE GROUND OF LOSS OF TRUST AND CONFIDENCE; GROSS NEGLIGENCE
SUMMARY & DOCTRINE

LTP terminated Cuizon’s employment for loss of trust and confidence in his ability
to perform his duties as MA2 Duty Manager which resulted from his numerous violations
and blatant disregard of the LTP Standards in the Workplace committed in two separate
incidents. The court ruled in favor of Cuizon stating that LTP failed to show that Cuizon
willfully, intentionally, knowingly, purposely, and without justifiable excuse disregarded
LTP's rules and regulations in the workplace.
DOCTRINE: Article 297 (formerly 282) of the Labor Code provides that an employer
may terminate its employee for "fraud or willful breach by the employee of the trust
reposed in him by his employer or duly authorized representative." "The requisites for
dismissal on the ground of loss of trust and confidence are: (1) the employee concerned
must be holding a position of trust and confidence; (2) there must be an act that would
justify the loss of trust and confidence; [and (3)] such loss of trust relates to the
employee's performance of duties.” Moreover, gross negligence implies a want or absence
of or a failure to exercise slight care or diligence, or the entire absence of care. "Neglect
of duty, as a ground for dismissal, must be both gross and habitual."
NOTE
155
Post-Employment: Termination of Employment by Employee, Reliefs from Illegal
Dismissal
SAN MIGUEL CORP. V. GOMEZ G.R. NO. 200815 | AUGUST 24,
2020
ILLEGAL DISMISSAL; DISMISSAL ON THE GROUND OF LOSS OF TRUST AND CONFIDENCE
SUMMARY & DOCTRINE

SMC, in its investigation, found out that Gomez had been collecting 25%
commission from the total payment received by C2K, and an audit revealed that Gomez
was allegedly involved in the anomalies which caused losses to SMC. SMC found Gomez
guilty and terminated her services which prompted her to file a case for illegal dismissal.
DOCTRINE: Article 297 [282] (c) of the Labor Code provides that an employer may
terminate the services of its employee for "fraud or willful breach x x x of the trust
reposed in him by his employer or duly authorized representative." As a rule, employers
have the discretion to manage its own affairs, which includes the imposition of
disciplinary measures on its employees. Nonetheless, employers may not arbitrarily
dismiss their employees by simply invoking Article 297 [282] (c). The loss of confidence
must be genuine and cannot be used as a "subterfuge for causes which are improper,
illegal or unjustified."
The requisites for dismissal on the ground of loss of trust and confidence are: "(1)
trust relates to the employee's performance of duties."
NOTE
COLEGIO SAN AGUSTIN-BACOLOD V. MONTAÑO

G.R. NO. 212333 | MARCH 28, 2022
DUE PROCESS; VALIDITY OF DISMISSAL; IMPROPER CONDUCT
SUMMARY & DOCTRINE

Respondent, Dr. Melinda M. Montaño, the appointed school registrar of Petitioner,
CSA-Bacolod was terminated due to complaints from two faculty members alleging that
she allowed some students to attend the graduation ceremony despite not meeting the
requirements.
156
DOCTRINE: Two requisites must be complied with to justify this ground for
termination. First, the employee must be holding a position of trust; and second, the
employer shall sufficiently establish the employee's act that would justify loss of trust and
confidence. The act must be characterized as real wherein the facts that brought about
the act were clearly established, and that the employee committed the same without any
justifiable reason.
Labor Code allows an employer to preventively suspend an employee if continued
employment poses a serious and imminent threat to the life or property of the employer
or co-workers. In preventive suspension, the employer safeguards itself from further harm
or loss that may further be caused by the erring employee.
JR HAULING SERVICES V. SOLAMO

G.R. NO. 214294 | SEPTEMBER 30, 2020
ILLEGAL DISMISSAL; SERIOUS MISCONDUCT AND LOSS OF TRUST AND CONFIDENCE
SUMMARY & DOCTRINE

Solamo et.al. are drivers and helpers of JR Hauling Services in delivering broiler
chickens in different parts of Pangasinan, Tarlac, Batangas, Bulacan, Zambales, or La
Union, to the processing plant of its clients in Hermosa, Bataan. They were dismissed, by
displaying their pictures on the company’s premises and barring their entry, after finding
that there were shortages in the delivery and that Solamo, et. al. were engaged in
anomalous transactions involving the sale of excess broilers and crates somewhere in
Concepcion, Tarlac.
DOCTRINE: Misconduct as "the transgression of some established and definite rule

of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful
intent and not mere error in judgment. For serious misconduct to justify dismissal under
the law, "(a) it must be serious; (b) must relate to the performance of the employee's
duties; and (c) must show that the employee has become unfit to continue working for
the employer."

unfit to continue working for the employer. In addition, loss of confidence as a just cause
for termination of employment is premised on the fact that the employee concerned
holds a position of responsibility, trust and confidence or that the employee concerned is
157
GESOLGON V. CYBERONE PH., INC.
G.R. NO. 210741 | OCTOBER 14, 2020
EMPLOYER-EMPLOYEE RELATIONSHIP; ILLEGAL DISMISSAL
SUMMARY & DOCTRINE

Gesolgon and Santos were employees of CyberOne AU as home-based customer
service representatives. Later, they were asked to become dummy directors/stockholders
of CyberOne PH. However, their position as director of CyberOne PH were later on
terminated.
DOCTRINE: The four-fold test used in determining the existence of

employer-employee relationship involves an inquiry into: (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 method
by which the work is to be accomplished.
NOTE
The Court did not acquire jurisdiction over CyberOne AU. CyberOne PH is neither
the resident agent nor the conduit of CyberOne AU upon which summons may be served.
Also, there existed no employer-employee relationship between petitioners and CyberOne
PH. Hence, there is no dismissal to speak of, much more illegal dismissal.
OMANFIL INTERNATIONAL MANPOWER DEVELOPMENT CORP. V. MESINA

G.R. NO. 217169 | NOVEMBER 4, 2020
ILLEGAL DISMISSAL
SUMMARY & DOCTRINE

An Overseas Filipino Worker was deployed abroad. During the duration of his
contract, he suffered heart ailments which prompted his principal to repatriate him to
the Philippines. When he sought to enforce the stipulation in his contract granting him
medical benefits, the recruiter refused to heed his request and instead asserted that he
was no longer employed by virtue of his repatriation.
DOCTRINE: For a dismissal on the ground of disease to be considered valid, two

requisites must concur: (a) the employee suffers from a disease which cannot be cured
within six months and his/her continued employment is prohibited by law or prejudicial to
his/her health or to the health of his/her co-employees, and (b) a certification to that
effect must be issued by a competent public health authority.
158
SPOUSES MAYNES V. OREIRO
G.R. NO. 206109 | NOVEMBER 25, 2020
TERMINATION OF EMPLOYMENT BY EMPLOYER: JUST CAUSES
SUMMARY & DOCTRINE

An employee who holds a position reposed with trust and confidence and
subsequently breached the same may be validly dismissed by an employer by first, giving
opportunity to be heard and to defend himself. In this case, the employee was dismissed
for a just cause (loss of trust and confidence) but the employer did not observe due
process.
DOCTRINE: Article 297 (c), which refers to "fraud or willful breach by the
employee of the trust reposed in [him/her] by [his/her] employer" or simply termed as
"loss of trust and confidence," is a just cause for dismissal. The requisites for dismissal on
the ground of loss of trust and confidence are: (1) the employee concerned must be
holding a position of trust and confidence; and (2) there must be an act that would justify
the loss of trust and confidence. In addition to these, such loss of trust relates to the
employee's performance of duties.
In termination cases, procedural due process consists of the twin requirements of

notice and hearing. The employer must furnish the employee with two (2) written notices
before the termination of employment can be effected: (1) the first apprises the
employee of the particular acts or omissions for which his dismissal is sought; and (2) the
second informs the employee of the employer's decision to dismiss him. The requirement
of a hearing is complied with as long as there was an opportunity to be heard, and not
necessarily that an actual hearing was conducted."
In the case at bar, the just cause for dismissal was duly established, but the
employee was not accorded her right to procedural due process. She was not given any
notice to explain or the opportunity to be heard before her dismissal. She only learned
about her dismissal from service when notices were posted in the premises of the outlet
stating that she is already terminated from her work. Thus, as correctly held by the CA,
she is entitled to an award of nominal damages in the amount of P30,000.00 in
accordance with recent jurisprudence.
159
SANTOS, JR. V. KING CHEF
G.R. NO. 211073 | NOVEMBER 25, 2020
ILLEGAL DISMISSAL; ABANDONMENT
SUMMARY & DOCTRINE

Failing to report on Christmas Day, the restaurant’s cooks Santos, Jr. and Salmasan
alleged they were illegally dismissed after their chief cook told them [sic] they were
already terminated.
DOCTRINE: In cases of illegal dismissal, the employer bears the burden to prove
that the termination was for a valid or authorized cause. But before the employer must
bear the burden of proving that the dismissal was legal, it is well-settled that the
employees must first establish by substantial evidence that indeed they were dismissed. If
there is no dismissal, then there can be no question as to the legality or illegality thereof.
Abandonment is a matter of intention and cannot lightly be presumed from certain

equivocal acts. The employer must prove that first, the employee "failed to report for
work for an unjustifiable reason," and second, the “overt acts showing the employee's
clear intention to sever their ties with their employer.
ANGONO MEDICS HOSPITAL, INC. V. AGABIN

G.R. NO. 202542 | DECEMBER 9, 2020
ILLEGAL DISMISSAL; SEPARATION PAY AND BACKWAGES
SUMMARY & DOCTRINE

After taking an approved leave of absence to fulfill the requirements of her
nursing schooling, Agabin was told not to report to work anymore as her employment was
already terminated.
DOCTRINE: It is settled that "the twin reliefs that should be given to an illegally
dismissed employee are full backwages and reinstatement. Backwages restore the lost
income of an employee and is computed from the time compensation was withheld up to
actual reinstatement. Anent reinstatement, only when it is not viable is separation pay
given."
160
LAMADRID V. CATHAY PACIFIC AIRWAYS LIMITED
G.R. NO. 200658 | JUNE 23, 2021
TERMINATION OF EMPLOYMENT BY EMPLOYER / ARTICLE 297
SUMMARY & DOCTRINE

Lamadrid transgressed Cathay's Disciplinary and Grievance Policy by taking out the
(Evian) bottle of water without authorization. However, while the weight of evidence
points to Lamadrid's infraction of company policy, the Court considered that this is
Lamadrid's first infraction in her 17 years of service in the airline which involved a mere
bottle of water. The Court held that Lamadrid's termination was not commensurate to the
infraction committed
DOCTRINE: In Merin v. National Labor Relations Commission, the Court explained

the principle of "totality of infractions" in this wise:
erring employee.
NOTE
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of
his employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of his
employer or any immediate member of his family or his duly authorized
representatives; and
(e) Other causes analogous to the foregoing.
There is loss of trust and confidence when an employee fraudulently and willfully
committed acts or omission in breach of the trust reposed in her/him by the employer.
Two requisites must be complied with to justify this ground for termination. First, the
employee must be holding a position of trust, and second, the employer shall sufficiently
establish the employee's act that would justify loss of trust and confidence. The act must
be characterized as real wherein the facts that brought about such an act were clearly
established, and that the employee committed the same without any justifiable reason.
161
PACIFIC ROYAL BASIC FOODS, INC. V. NOCHE
G.R. NO. 202392 | OCTOBER 4, 2021
SUMMARY & DOCTRINE

Respondents' positions as coconut parers in no case do they fit the job description
of managerial employees and fiduciary rank-and-file employees. Manual work such as
paring coconuts for commercial production is a task that does not entail being routinely
entrusted with the care and custody of money and property belonging to the company like
fiduciary rank-and-file employees; much less they can be considered to be directly
involved in the management and policy-making of their employer as managerial
employees. Having occupied ordinary rank-and-file posts, their dismissal on the ground of
loss of trust and confidence is illegal.
DOCTRINE: Following Wesleyan University Philippines v. Reyes, two requisites must

concur for a valid termination of employment due to loss of trust and confidence:
The first requisite is that the employee concerned must be one holding a position
of trust and confidence, thus, one who is either: (1) a managerial employee; or (2) a
fiduciary rank-and-file employee, who, in the normal exercise of his or her functions,
regularly handles significant amounts of money or property of the employer. The second
requisite is that the loss of confidence must be based on a willful breach of trust and
founded on clearly established facts.
NOTE
M + W Zander Philippines, Inc. v. Enriquez differentiates managerial and fiduciary
rank-and-file employees within the purview of dismissals due to loss of trust and
confidence, as follows:
There are two classes of positions of trust: managerial employees and fiduciary
rank-and-file employees.
Managerial employees are defined as those vested with the powers or prerogatives
to lay down management policies and to hire, transfer, suspend, lay-off, recall, discharge,
assign or discipline employees or effectively recommend such managerial actions. They
refer to those whose primary duty consists of the management of the establishment in
which they are employed or of a department or a subdivision thereof, and to other
officers or members of the managerial staff. Officers and members of the managerial
staff perform work directly related to management policies of their employer and
customarily and regularly exercise discretion and independent judgment.
The second class or fiduciary rank-and-file employees consist of cashiers, auditors,

property custodians, etc., or those who, in the normal exercise of their functions,
regularly handle significant amounts of money or property. These employees, though
rank-and-file, are routinely charged with the care and custody of the employer's money or
property, and are thus classified as occupying positions of trust and confidence.
162
BELARSO V. QUALITY HOUSE, INC.
G.R. NO. 209983 | NOVEMBER 10, 2021
SUMMARY & DOCTRINE

Petitioner was validly dismissed for just cause - due to loss or breach of trust and
confidence. She had violated company rules and policies by stealing a belt buckle and
failed to give a valid explanation why the belt buckle was in her possession.
DOCTRINE: Loss or breach of trust and confidence, as a just cause for termination
by an employer, is based on Article 297 of the Labor Code:
xxx xxx xxx
(c) Fraud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative.
Jurisprudence provides for two conditions before an employee may be dismissed

for such cause:
First. Breach of trust and confidence must be premised on the fact that the
employee concerned holds a position of trust and confidence, where greater trust is
placed by management and from whom greater fidelity to duty is correspondingly
expected. The essence of the offense for which an employee is penalized is the betrayal
of such trust.
Second. There must be some basis for the loss of trust and confidence. The
employer must present clear and convincing proof of an actual breach of duty committed
by the employee by establishing the facts and incidents upon which the loss of confidence
in the employee may fairly be made to rest. This means that "the employer must establish
the existence of an act justifying the loss of trust and confidence." Otherwise, employees
will be left at the mercy of their employers.
163
SYSTEMS ANDPLAN INTEGRATOR AND DEVELOPMENT CORP. V.
BALLESTEROS
G.R. NO. 217119 | APRIL 25, 2022
TERMINATION OF EMPLOYMENT
SUMMARY & DOCTRINE

An employee was asked by the company to resign because she was pregnant, and
was going to have two children to take care of and she refused. The company withheld
the salary and would only be released if the employee would process her SSS maternity
benefits and tender her resignation letter.
DOCTRINE: The burden of proving that the termination of an employee was for a
just or authorized cause lies with the employer. If the employer fails to meet this burden,
the dismissal is unjustified, thus, illegal. To discharge this burden, the employer must
present substantial evidence, or the amount of relevant evidence which a reasonable
mind might accept as adequate to justify a conclusion, and not based on mere surmises or
conjectures.
NOTE
The rudimentary requirements of due process require that an employer dismissing
an employee must furnish the latter with two written notices before the termination of
employment can be affected: (1) the first notice apprises the employee of the particular
acts or omissions for which the dismissal is sought; and (2) the second notice informs the
employee of the employer's decision to dismiss him or her.
For willful disobedience to be a valid cause for dismissal, these two elements must
concur: (1) the employee's assailed conduct must have been willful or intentional, the
willfulness being characterized by "a wrongful and perverse attitude"; and (2) the order
violated must have been reasonable, lawful, made known to the employee, and must
pertain to the duties which he had been engaged to discharge.
Loss of trust and confidence may be a just case for termination of employment
only upon proof that: (1) the dismissed employee occupied a position of trust and
confidence; and (2) the dismissed employee committed "an act justifying the loss of trust
and confidence”
164
REGALA V. MANILA HOTEL CORP.
G.R. NO. 204684 | OCTOBER 5, 2020
SUMMARY & DOCTRINE

Regala was hired by the hotel as one of its waiters assigned to the Food and
Beverage Department, but he was not recognized as a regular rank-and-file employee
despite having rendered services for several years and the hotel constructively dismissed
him from employment when it allegedly reduced his regular work days that resulted to
diminution of his salary.
DOCTRINE: There is constructive dismissal where "there is cessation of work

because 'continued employment is rendered impossible, unreasonable or unlikely, as an
offer involving a demotion in rank or a diminution in pay' and other benefits. Aptly called
a dismissal in disguise or an act amounting to dismissal but made to appear as if it were
employment."
GOSOSO V. LEYTE LUMBER YARD AND HARDWARE, INC.

G.R. NO. 205257 | JANUARY 13, 2021
CONSTRUCTIVE DISMISSAL; ABANDONMENT
SUMMARY & DOCTRINE

A sales representative allegedly overstepped the boundaries of the company
policies and he was required to submit a letter of apology, and he complied, but the
company wants the employee to sign a document that contained admissions of offenses
that the employee did not commit. Irked by the employee's refusal, the company
informed him of his termination from work.
DOCTRINE: Abandonment requires the concurrence of the following: (1) the

employee must have failed to report for work or must have been absent without valid or
justifiable reason; and (2) there must have been a clear intention to sever the
employer-employee relationship manifested by some overt acts. Abandonment is a matter
of intention and cannot lightly be presumed from equivocal acts. Absence must be
accompanied by overt acts pointing definitely to the fact that the employee simply does
not want to work anymore. The burden of proof to show that there was unjustified refusal
to go back to work rests on the employer.
165
Mere absence or simple failure to report for work is not abandonment, more so if
the employee was able to lodge his complaint before the labor tribunals with haste. An
immediate filing of a complaint for illegal dismissal, more so when it includes a prayer for
reinstatement, is inconsistent with a charge of abandonment. Indeed, employees like
Gososo who take steps to protest their alleged dismissal cannot be said to have
abandoned their work.
NOTE
In labor cases, substantial evidence is the basic minimum of required proof — or
that amount of evidence a reasonable mind might accept as adequate to support a
conclusion. In illegal dismissal cases, the employee must first establish by substantial
evidence the fact of dismissal before the employer is charged with the burden of proving
its legality.
DELA TORRE V. TWINSTAR PROFESSIONAL PROTECTIVE SERVICES, INC.

G.R. NO. 222992 | JUNE 23, 2021
SUMMARY & DOCTRINE

Jose R. Dela Torre, petitioner, was employed as a security guard by Twinstar
Professional Protective Services, Inc., respondent. Petitioner alleged that he was on
floating status for more than six (6) months which prompted him to file a complaint for
illegal dismissal and non-payment of separation pay.
DOCTRINE: There is constructive dismissal where "there is cessation of work

because 'continued employment is rendered impossible, unreasonable or unlikely, as an
offer involving a demotion in rank or a diminution in pay' and other benefits. Aptly called
a dismissal in disguise or an act amounting to dismissal but made to appear as if it were
employment."
166
TACIS V. SHIELDS SECURITY SERVICES, INC. G.R. NO. 234575 |
JULY 7, 2021
SUMMARY & DOCTRINE

Petitioners Renato C. Tacis and Dionicio Lamis III filed a complaint for illegal
dismissal, with claims for payment of full backwages, separation pay in lieu of
reinstatement and salary differentials against respondent, Shields Security Services, Inc.
Along with the company, individual respondents, Teresita Soliman and Dionefel Morante
are being sued in their capacities as the company's President and General Manager,
respectively.
DOCTRINE: For resignation from employment to be valid, there must be an intent

to relinquish the position together with the overt act of relinquishment. Resignation must
be voluntary. In illegal dismissal cases, the employer, if defense of resignation is
presented, must show that the employee indeed voluntarily resigned.
PHILAM HOMEOWNERS ASSOCIATION, INC. V. DE LUNA G.R. NO.

209437 | MARCH 17, 2021
EXTENSION OF PREVENTIVE SUSPENSION
SUMMARY & DOCTRINE

Philam Homeowners Association, Inc. and Marcia Caguiat filed a petition for
Certiorari in relation to the decision of the Court of Appeals favoring respondents Sylvia
De Luna and Nenita Bundoc. De Luna and Bundoc used to work with PHAI. During an audit
of PHAI's books of accounts, several irregularities were discovered such as issuance of
unauthorized official and provisional receipts, unrecorded and undeposited collections,
and encashment of personal checks. The Investigating Committee disclosed that De Luna
and Bundoc were involved in said fraudulent activities particularly in the disbursement of
PHAI's funds. De Luna and Bundoc were dismissed for fraud or willful breach of trust and
confidence by an employee.
DOCTRINE: For a dismissal to be valid, it must comply with the substantive and
the procedural due process. An employee cannot be terminated without just or
authorized cause. The twin-notice rule must be observed, and the erring employee must
be given the opportunity to present his/her side of the controversy.
167
BANCE V. UNIVERSITY OF ST. ANTHONY
G.R. NO. 202724 | FEBRUARY 3, 2021
VOLUNTARY RESIGNATION
SUMMARY & DOCTRINE

Petitioners Susan Bance, Arlene Dimaiwat, Jean Velasco, Nancy Aguirre, and Hazel
Lobetania filed their respective complaints for illegal dismissal with money claims against
the respondents after they were alleged to be the perpetrators of irregular and
anomalous transactions that were noted in the University's Accounting Office. As such,
they were informed that their employment will be terminated on grounds of dishonesty
amounting to malversation of school funds.
DOCTRINE: For resignation from employment to be valid, there must be an intent

to relinquish the position together with the overt act of relinquishment. Resignation must
be voluntary. In illegal dismissal cases, the employer, if defense of resignation is
presented, must show that the employee indeed voluntarily resigned.
NOTE
Central Azucarera De Bais, Inc. v. Siason discusses the concept of resignation:
Resignation is the formal pronouncement or relinquishment of a position or office. It is
the voluntary act of an employee who is in a situation where he believes that personal
reasons cannot be sacrificed in favor of the exigency of the service, and he has then no
other choice but to disassociate himself from employment. The intent to relinquish must
concur with the overt act of relinquishment; hence, the acts of the employee before and
after the alleged resignation must be considered in determining whether he in fact
intended to terminate his employment. In illegal dismissal cases, it is a fundamental rule
that when an employer interposes the defense of resignation, he necessarily rests the
burden to prove that the employee indeed voluntarily resigned.
PHILIPPINE NATIONAL BANK V. BULATAO

G.R. NO. 200972 | DECEMBER 11, 2019
AWARD OF SEPARATION PAY
SUMMARY & DOCTRINE

Bulatao manifested his intent to retire after his objection to the JVA of PNB with
Mr. Roy. When the deal with the Indian group did not materialize, Bulatao made a sudden
turn-around, alleging also that he had a meeting with Mr. Lucio Tan (Mr. Tan) who asked
him to reconsider his decision to retire and join Mr. Tan’s team. Because of this, Bulatao
alleged that he went back to work but four days from the date of his Memorandum,
168
Bulatao received a call from the SVP of Human Resource Division who informed him not to
report for work in February 2000 as the Board already accepted his "resignation."
DOCTRINE: Although reinstatement is a matter of right, the award of separation
pay is an exception to such rule, as it is awarded in lieu of reinstatement in the following
circumstances: (a) when reinstatement can no longer be effected in view of the passage
of a long period of time or because of the realities of the situation; (b) reinstatement is
inimical to the employer's interest; (c) reinstatement is no longer feasible; (d)
reinstatement does not serve the best interests of the parties involved; (e) the employer
is prejudiced by the workers' continued employment; (f) facts that make execution unjust
or inequitable have supervened; or (g) strained relations between the employer and
employee."
ITALKARAT 18, INC. V. GERASMIO

G.R. NO. 221411 | SEPTEMBER 28, 2020
SEPARATION PAY
SUMMARY & DOCTRINE

Respondent Juraldine Gerasmio filed a complaint for illegal dismissal against the
petitioner Italkarat Inc. Juraldine alleged that he was hired in 1990 and that he was
designated as the Maintenance Head and Tool and Die Maker until his dismissal on the
ground of serious business losses.
DOCTRINE: As a general rule, the law does not require employers to pay
employees that have resigned any separation pay, unless there is a contract that provides
otherwise or there exists a company practice of giving separation pay to resignees.
NOTE
A company's practice of paying separation pay to resignees must be proven to exist
as this is an exception to the general rule that employees who voluntarily resign are not
entitled to separation pay.
169
DEL PILAR V. BATANGAS II ELECTRIC COOPERATIVE, INC.
G.R. NO. 160090 & 160121 | FEBRUARY 19, 2020
JURISDICTION OF NLRC
SUMMARY & DOCTRINE

Complainants were employees of BATELEC II who were dismissed twice by the
latter. They claim that the CA gravely erred in entertaining the appeal, more so because
not only did it disturb the computation of the Labor Arbiter, it also revived controversies
already adjudicated upon. Complainants add that instead of an appeal to the CA, BATELEC
II should have filed a petition for injunction with the NLRC questioning the computation of
the award pursuant to Rule XI, Section 1 of the New Rules of Procedure of the NLRC.
DOCTRINE: Article 223 provides that decisions, awards, or orders of the Labor
Arbiter are final and executory unless appealed to the NLRC. The NLRC has exclusive
appellate jurisdiction over all cases decided by labor arbiters as provided in Article 217(b)
of the Labor Code. From the finding of illegal dismissal up to the execution of the
monetary award, the jurisdiction of the NLRC is appellate in nature. "Article 218(e) of the
Labor Code does not provide blanket authority to the NLRC or any of its divisions to issue
writs of injunction, considering that Section 1 of Rule XI of the New Rules of Procedure of
the NLRC makes injunction only an ancillary remedy in ordinary labor disputes."
ESICO V. ALPHALAND CORP.

G.R. NO. 216716 | NOVEMBER 17, 2021
JURISDICTION OF LA AND NLRC
SUMMARY & DOCTRINE

Jose Edwin G. Esico filed a complaint for constructive dismissal against
respondents Alphaland Corporation and Alphaland Development, Inc. PhilWeb initially
hired Esico as Risk & Security Management Officer. Alphaland concurrently engaged Esico
as a rotary wing pilot assigned to fly Roberto V. Ongpin to his various engagements within
and outside the country. Esico signed the job offer believing that it is the compensation
package that he had asked for separately from his work as Risk & Security Management
Officer for Philweb. Esico received a bond requiring him to render service to the Company
for a minimum period of 5 years in consideration of the expenses for the flight course
training. Thereafter, Esico tendered his letter of resignation based on several issues.
DOCTRINE: San Miguel Corporation v. National Labor Relations Commission

illuminates, thus:
170
“…where the claim to the principal relief sought is to be resolved not by
reference to the Labor Code or other labor relations statute or a collective
bargaining agreement but by the general civil law, the jurisdiction over the
dispute belongs to the regular courts of justice and not to the Labor Arbiter
and the NLRC. In such situations, resolution of the dispute requires expertise,
not in labor management relations nor in wage structures and other terms and
conditions of employment, but rather in the application of the general civil
law. Clearly, such claims fall outside the area of competence or expertise
ordinarily ascribed to Labor Arbiters and the NLRC and the rationale for
granting jurisdiction over such claims to these agencies disappears.
The general rule is that the issue of jurisdiction may be raised at any stage of the
proceedings, even on appeal, and is not lost by waiver or by estoppel. Tijam is merely an
exception to the general rule, laches occurring in a particular case will only bar a litigant
from raising the issue of lack of jurisdiction when the factual milieu obtaining therein is
on all fours with Tijam, i.e., silence or inaction for an inexplicable length of time.
DEL MONTE LAND TRANSPORT BUS, CO. V. ARMENTA

G.R. NO. 240144 | FEBRUARY 3, 2021
JURISDICTION AND RELIEF
SUMMARY & DOCTRINE

Respondents, who are bus drivers and conductors of DLTB, filed a complaint before
the Labor Arbiter for money claims on wage differentials and wage-related benefits in
violation of DO 118-12 against the latter. They are correspondingly challenging the
issuance by the DOLE Regional Director of the Labor Standards Compliance Certificates to
DMWWI, owner and operator of DLTB.
DOCTRINE: If a complaint is brought before the DOLE to give effect to the labor
standards provisions of the Labor Code or other labor legislation, and there is a finding by
the DOLE that there is an existing employer-employee relationship, the DOLE exercises
jurisdiction to the exclusion of the NLRC. If the DOLE finds that there is no
employer-employee relationship, the jurisdiction is properly with the NLRC. If a complaint
is filed with the DOLE, and it is accompanied by a claim for reinstatement, the
jurisdiction is properly with the Labor Arbiter, under Art. 217 (3) of the Labor Code, which
provides that the Labor Arbiter has original and exclusive jurisdiction over those cases
involving wages, rates of pay, hours of work, and other terms and conditions of
employment, if accompanied by a claim for reinstatement. If a complaint is filed with the
NLRC, and there is still an existing employer-employee relationship, the jurisdiction is
properly with the DOLE.
171
DE JESUS V. INTER-ORIENT MARITIME ENTERPRISES, INC.
G.R. NO. 203478 | JUNE 23, 2021
REQUISITES FOR VALIDITY AND CONSEQUENCE OF QUITCLAIMS
SUMMARY & DOCTRINE

When De Jesus was diagnosed with an illness which rendered him unfit for physical
work, he was asked to execute a Quitclaim without the aid of a counsel and with small
consideration. He claims that the irregular and apparent haste in the execution of the
complaint, motion to dismiss and quitclaim all in one day, and the lack of
acknowledgment before a Notary Public would not render the Quitclaim valid.
DOCTRINE: In order for a deed of release, waiver or quitclaim pertaining to an

existing right to be valid, it must meet the following requirements: (1) that there was no
fraud or deceit or coercion on the part of any of the parties; (2) that the consideration for
the quitclaim is sufficient and reasonable; and (3) that the contract is not contrary to law,
public order, public policy, morals or good customs, or prejudicial to a third person with a
right recognized by law. It further sustained the validity of the quitclaim considering that
it was signed before the Labor Arbiter in accordance with Article 227 of the Labor Code
which provides that “Any compromise settlement, including those involving labor standard
laws, voluntarily agreed upon by the parties with the assistance of the Bureau or the
regional office of the Department of Labor, shall be final and binding upon the parties x x
x…”
172

LABOR LAW - Hernando CDD 2023

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THAT IN ALL THINGS, GOD MAY BE GLORIFIED

Publication, reproduction, dissemination, and distribution, or

Material includes both cases penned by Justice Hernando and recent

Burden of Proof and Quantum of Evidence

V People Manpower Phils., Inc. vs. Buquid 55

Jurisdiction and Remedies

Esico vs. Alphaland Corp. 126

Burden of Proof and Quantum of Evidence

Termination of Employment by Employer

Termination of Employment by Employee

Reliefs from Illegal Dismissal

Jurisdiction and Remedies

That no receipt or document in which appellant acknowledged receipt of money

Under RA 8042, a non-licensee or non-holder of authority commits illegal

In estafa, damage is essential, but not in the crime of illegal recruitment. As to

Tura then demanded the reimbursement but to no avail, therefore he filed a

The prosecution presented private complainants Carol Pagulayan Sepina, Allan P.

The 144-hectares portion allocated to the Spouses Tanjangco was transferred to

Petitioner alleged that respondents were disqualified to retain, considering that

Respondents' application for retention pertained to areas in the entire 238.7949

The heirs of Carlos Jr. executed an Extrajudicial Settlement of Estate which

Concepcion,as the representative , executed a second agreement with the tenants

As a rule, the existence of a tenancy relationship cannot be presumed and

As a rule, the existence of a tenancy relationship cannot be presumed and

Subsequently, Jose obtained a loan from respondent Rural Bank of Jaen

The court furthermore reiterated that the findings of the company-designated

In Manaway v. Philippine Transmarine Carriers, Inc., the Court held that:

The assessment to be conclusive must be complete and definite; otherwise, the

2. No, Mabalot is not entitled to permanent total disability benefits. The

3. In addition to the above obligation of the employer to provide medical

xxx xxx xxx

For this purpose, the seafarer shall submit himself to a post-employment

If a doctor appointed by the seafarer disagrees with the assessment, a third

Section 20 (A) of the 2010 POEA-SEC provides that for an illness to be

Edgardo argues that the presumption of work-relatedness was not disputed by

It is settled that awards of disability compensation cannot be based on mere

Section 20 (A) of the 2010 POEA-SEC provides that for an illness to be

In the instant case, it is undisputed that petitioner's illness, ulcerative colitis, is

Non-compliance with the post-employment medical examination requirement is

Ville underwent another PEME as a prerequisite for another deployment. In said

Ville disembarked on March 1, 2012, a Thursday. He had three working days or

Signing of the Certificate of Fitness to Work effectively released petitioners from

As between the findings of the company-designated physicians who conducted

Moreover, Jaicten's signing of the Certificate of Fitness to Work effectively

Destriza contends that he is entitled to disability benefits as previously awarded by

Section 32-A. OCCUPATIONAL DISEASES provides that for an occupational

According to Yarza, when SRL started processing his documents, he underwent a

The Labor Arbiter rendered a Decision declaring the existence of an

Applying the "four-fold test" in determining the existence of an

Ginta-Ason presented no document setting forth the terms of his employment,

The case of Olongapo Maintenance Services, Inc. v. Chantengco is applicable:

The principal test in determining whether an employee is a project

ARTICLE 295. [280] Regular and Casual Employment. — The provisions of

An employment shall be deemed to be casual if it is not covered by the

Based on the foregoing provisions, an employment is generally deemed regular

Based on the foregoing provisions, an employment is generally deemed regular

Upon careful review of the company's respective contracts of employment with

An overseas employee, in order to be considered as a "seafarer," must not only

Dominador claimed that during his employment, he was constantly exposed to

The LA held that Dominador was employed as a seafarer whose illness is

Respondents maintained that during Cabatan's last employment contract, he

As applied in this case, the fixed-term contracts presented as evidence would

As applied in this case, the fixed-term contracts presented as evidence would