2023 UST Labor Law Case Digests (J. Hernando)

Case Digests
PONENCIAS OF JUSTICE HERNANDO

By: USTFCL Dean’s Circle for AY 22-23
Labor Law
Case Digests
University of Santo Tomas
Faculty of Civil Law
Dean's Circle for AY 2022-2023
ALLAN REGALA v. MANILA HOTEL CORPORATION

G.R. No. 204684. October 5, 2020, Second Division (Hernando, J.)
DOCTRINE
“The employment status of a person is defined and prescribed by law and not by what
the parties say it should be. In this regard, Article 295 of the Labor Code "provides for two types
of regular employees, namely: (a) those who are engaged to perform activities which are
usually necessary or desirable in the usual business or trade of the employer (first category);
and (b) those who have rendered at least one year of service, whether continuous or broken,
with respect to the activity in which they are employed (second category).”
Moreover, 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 MHC sometime in February 2000 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 during the period from October 18, 2004 to June 26, 2006.
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. MHC also
remitted contributions in Regala's behalf to the Social Security System (SSS) and Philippine
Health Insurance Corporation (PhilHealth).
Regala alleged that he was not recognized as a regular rank-and-file employee despite
having rendered services to MHC for several years. Regala also 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.
On its part, 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. MHC then
presented a sample fixed-term service contract,19 and copies of Regala's Department Outlet
Services Contracts for Extra Waiters/Cocktail Attendants (Service Agreements) covering the
Page 2 of 141
Case Digests
periods of his supposed temporary engagement with MHC, or from March 1, 2010 to March
3, 2010.
The Labor Arbiter dismissed the complaint for lack of merit. The LA held that Regala
is a fixed-term employee of MHC and that he voluntarily executed the Service Agreements
with MHC with a full understanding that his engagement with it was only for a fixed period.
On the issue of constructive dismissal, the LA held that Regala's claim of constructive
dismissal must fail considering that he continued reporting for work at MHC at the time he
instituted the instant complaint for illegal or constructive dismissal.
The NLRC reversed the Decision of the LA and held that Regala is a regular employee
of MHC. Being a regular employee of MHC, the NLRC found that Regala was constructively
dismissed from employment when MHC reduced his take- home pay as a consequence of the
hotel's changes in his work schedule which reduced his work days from five (5) days a week
to two (2) days a week.
Aggrieved, MHC filed a Petition for Certiorari. The CA rendered its assailed Decision
granting MHC's Petition for Certiorari and setting aside the decision of the NLRC.
ISSUES
1. Whether or not Regala is a regular employee of MHC.

2. Whether Regala was constructively dismissed from employment.
RULING
1. YES. The employment status of a person is defined and prescribed by law and not by
what the parties say it should be. In this regard, Article 295 of the Labor Code
"provides for two types of regular employees, namely: (a) those who are engaged to
perform activities which are usually necessary or desirable in the usual business or
trade of the employer (first category); and (b) those who have rendered at least one
year of service, whether continuous or broken, with respect to the activity in which
they are employed (second category)." 60 While MHC insists that Regala was engaged
under a fixed-term employment agreement, the circumstances and evidence on
record, and provision of law, however, dictate that Regala is its regular employee.
First, Regala is performing activities which are usually necessary or desirable

in the business or trade of MHC. This connection can be determined by considering
the nature of the work performed by Regala and its relation to the nature of the
particular business or trade of MHC in its entirety.Being part of the hotel and food
industry, MHC, as a service- oriented business enterprise, depends largely on its
manpower complement to carry out or perform services relating to food and
Page 3 of 141
Case Digests
beverage operations, event planning and hospitality. As such, it is essential, if at all

necessary, that it retains in its employ waiting staff, such as Regala, specifically tasked
to attend to its guests at its various dining establishments.
Second, the fact alone that Regala was allowed to work for MHC on several
occasions for several years under various Service Agreements is indicative of the
regularity and necessity of his functions to its business. Moreover, it bears to
emphasize that MHC has admitted, albeit implicitly, that it renewed Regala's Service
Agreements on various occasions is also sufficient evidence of the indispensability of
his duties as waiter to MHC's business.
2. YES. 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."
Patently, the reduction of Regala's regular work days from five (5) days to two
(2) days resulted to a diminution in pay. Regala's change in his work schedule
resulting to 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.
Page 4 of 141
Case Digests
RE: LETTER OF MRS. MA. CRISTINA ROCO CORONA REQUESTING THE GRANT OF
RETIREMENT AND OTHER BENEFITS TO THE LATE FORMER CHIEF JUSTICE RENATO
C. CORONA AND HER CLAIM FOR SURVIVORSHIP PENSION AS HIS WIFE UNDER
REPUBLIC ACT NO. 9946
A.M. No. 20-07-10-SC, January 12, 2021, En Banc (Hernando, J.)
DOCTRINE
“An impeached public officer whose civil, criminal, or administrative liability was not
judicially established may be considered involuntarily retired from service and is entitled to the
retirement benefits provided under RAs 9946 and 8291.”
FACTS
Renato Coronado Corona became the Chief Justice of the Philippines on May 12, 2010
after an eight-year stint as Associate Justice in the High Court. He occupied the judicial apex
very momentarily: a year after his appointment as Chief Justice, Articles of Impeachment
were filed against him and he was eventually indicted by the House of Representatives under
Section 2, Article VI of the 1987 Constitution on the alleged grounds of betrayal of public
trust, culpable violation of the Constitution, and graft and corruption.
After a heavily-publicized trial, the Senate declared Chief Justice Corona unfit to hold
such a lofty position and removed him from his office due mainly to his act of non-declaration
of his Statement of Assets, Liabilities, and Net Worth (SALN).
No objection or a motion for reconsideration was interposed against the judgment of

the Senate. Having been dishonorably stripped of his public office and having undergone a
most difficult and stressful trial, the Chief Justice's health quickly deteriorated culminating
to his death on April 29, 2016. The separate criminal charges for graft and corruption then
pending before the Sandiganbayan, as well as the tax evasion and forfeiture cases, were all
necessarily dismissed in view of the Chief Justice's demise.
In a letter dated July 13, 2020, Mrs. Corona asserts, albeit unseeking of its reversal,
that the Senate judgment removing the Chief Justice from office should be voided for
insufficiency of evidence and noncompliance with Section 14, Article VIII of the Constitution.
Citing the scholarly views of Father Joaquin G. Bernas, Mrs. Corona insists that her
late spouse's ouster by impeachment merely divested him of his political capacity as Chief
Justice of the Supreme Court. Thus, she prays that she be allowed to reap the retirement
benefits and other gratuities provided under Sections 1 and 3 of Republic Act No. 9946 (RA
9946), and monthly survivorship pension under Administrative Circular No. 81-2010 (AC
81- 2010).
Page 5 of 141
Case Digests
The matter was then referred to the Office of the Chief Attorney (OCAt) for its report
and evaluation. In a Report dated September 28, 2020, the OCAt shared Mrs. Corona's
opinion that a verdict in an impeachment case has the sole effect of ousting the errant official
from his/her post.
Its concurrence with Mrs. Corona, however, ended there. In its interpretation of
Sections 1 and 3 of RA 9946, the OCAt submits that it will be a stretch to consider former
Chief Justice Corona's removal by impeachment tantamount to an act of resignation by
reason of incapacity to discharge the duties of the office that he held. While forfeiture of
retirement benefits is not expressly included as a penalty in a judgment on an impeachment
proceeding, the OCAt posits that the gap be left as it is and referred to legislative discretion.
For lack of supporting legal basis, the OCAt recommended the denial of Mrs. Corona's claims
for the release of her late husband's retirement benefits and survivorship pension.
ISSUE
Whether or not retirement benefits, other gratuities, and survivorship pension

should be accorded to Mrs. Corona as the spouse of the late Chief Justice Corona despite the
latter's ouster by impeachment.
RULING
YES. An impeached public officer whose civil, criminal, or administrative liability was
not judicially established may be considered involuntarily retired from service and is
entitled to the retirement benefits provided under RAs 9946 and 8291.
The Court deems Chief Justice Corona to have been involuntarily retired from public
service due to the peculiar circumstances surrounding his removal by impeachment, without
forfeiture of his retirement benefits and other allowances.
Retirement is the termination of one's own employment or career, especially upon

reaching a certain age or for health reasons. To retire is to withdraw from one's position or
occupation, or to conclude one's active working life or professional career. Retirement then
may be voluntary or involuntary. Retirement is voluntary when one decides upon one's own
unilateral and independent volition to permanently cease the exercise of one's occupation.
Retirement is deemed involuntary when one's profession is terminated for reasons outside
the control and discretion of the worker. Impeachment resulting in removal from holding
office falls under the column on involuntary retirement.
The working tenets of this case bear tireless repetition. A respondent in impeachment
proceedings does not risk forfeiture of the constitutional rights to life, liberty, or property. A
Page 6 of 141
Case Digests
separate determination of liability under the courts of law is necessary to withhold such
rights. Sans judicial conviction, the impeached official shall only be removed from office, with
the Senate being empowered with the discretion to impose the additional penalty of
permanent disqualification from holding any and all further public office.
Having been removed by the Congress from office with a lifetime ban from occupying
any and all future public posts, but without a proper determination of or even a basis for any
recoverable liability under the law due to causes beyond his control, Chief Justice Corona
may be considered involuntarily retired from public service.
The OCAt posits that the late Chief Justice failed to qualify under RA 9946 or An Act
Granting Additional Retirement, Survivorship, and Other Benefits to Members of the
Judiciary, Amending for the Purpose Republic Act No. 910, as Amended, Providing Funds
Therefor and for Other Purposes. However, the Court disagrees.
The OCAt mistakenly focused on the preliminary wordings of Section 1, RA 9946. The
former Chief Justice can never be deemed to have retired at the age of 70, nor can he be
considered as resigned by reason of any permanent disability, as his separation from service
was not in any way effected through resignation. What has the most proximate application
to the case of former Chief Justice Corona is the proviso immediately succeeding the sentence
quoted and relied upon by the OCAt:
SECTION 1. x x x When a Justice of the Supreme Court, the Court of Appeals, the
Sandiganbayan or of the Court of Tax Appeals, or a Judge of the regional trial court,
metropolitan trial court, municipal trial court, municipal circuit trial court, shari'a
district court, shari'a circuit court, or any other court hereafter established has
attained the age of sixty (60) years and has rendered at least fifteen (15) years
of service in the Government, the last three (3) of which shall have been
continuously rendered in the Judiciary, he/she shall likewise be entitled to retire
and receive during the residue of his/her natural life also in the manner hereinafter
provided, the salary plus the highest monthly aggregate of transportation,
representation and other allowances such as personal economic relief allowance
(PERA) and additional compensation allowance which he/she was then receiving and
the non-wage benefit in the form of education scholarship to one (1) child of all
Justices and Judges to free tuition fee in a state university or college. x x x
Section 1 of RA 9946 yields two instances of retirement available to a magistrate —

first, a compulsory retirement at 70 years old; and second, an optional retirement upon
reaching 60 years of age. The following legal requisites must concur for the optional
retirement of a magistrate and the consequent entitlement to the benefits under RA 9946:
Page 7 of 141
Case Digests
(1) That the retiree be a magistrate,i.e., a Justice of the Supreme Court, the Court of
Appeals, the Sandiganbayan, or of the Court of Tax Appeals, or a judge of the trial
courts, shari'a court, or of any other judicial court;
(2) That the retiring magistrate has rendered at least fifteen (15) years of service in
the judiciary, in any other branch of the government, or in both;
(3) That the retiring magistrate be at least sixty (60) years of age at the time of
retirement; and
(4) That the last three (3) years of public service by the retiring magistrate be
continuously rendered in the Judiciary.
The requirements are straightforward and have all been satisfactorily complied with
by the late Chief Justice.
Having determined the entitlement of Chief Justice Corona to retirement benefits, it

naturally follows that his widow is likewise entitled to survivorship benefits reckoned from
the time of the demise of the late Chief Justice until the widow's death or remarriage.
Page 8 of 141
Case Digests
RE: EXPENSES OF RETIREMENT OF COURT OF APPEALS JUSTICES.

A.M. No. 19-02-03-CA, June 25, 2019, En Banc (Hernando, J.)
DOCTRINE
“After a judicious consideration of all important factors, the Court deems it appropriate
to grant an increase in the retirement program budgets for the retiring members of the Court
of Appeals in the amounts of One Million Five Hundred Thousand Pesos (PhP1,500,000.00) for
a Presiding Justice and One Million Two Hundred Thousand Pesos (PhP1,200,000.00) for an
Associate Justice. These amounts are partway between Presiding Justice Barza's proposed
budgets and Atty. Ferrer-Flores's recommended budgets..”
FACTS
In a letter dated February 15, 2019 to Chief Justice Lucas P. Bersamin, Presiding
Justice Romeo F. Barza of the Court of Appeals requested that the Court of Appeals be allowed
to budget the following amounts to defray the cost of the expenses relative to the retirement
of the Presiding Justice and Associate Justices, to wit:
a) For a retiring Presiding Justice — not to exceed Two Million Pesos (P2,000,000.00);
and
b) For a retiring Associate Justice — not to exceed One Million Eight Hundred
Thousand Pesos (P1,800,000.00) subject to liquidation in accordance with applicable
accounting and auditing rules.
Justice Barza also requested for a yearly increase of ten percent (10%) in the
aforesaid budget to cushion the effects of inflation.
Acting on the aforequoted letter, the Court issued a requiring the Fiscal Management
and Budget Office (FMBO) to comment thereon within 30 days from notice.
Atty. Corazon G. Ferrer-Flores, Deputy Clerk of Court and Chief, FMBO, submitted her
Comment. Taking into account the current budgets of the Sandiganbayan, the Court of Tax
Appeals (CTA), and the Supreme Court for their respective Retirement Programs; plus the
budgetary history of the Court of Appeals and the impact of the proposed increase in the
retirement program budgets for retiring Court of Appeals Presiding and Associate Justices
on the present as well as future overall budgets of the said appellate court, Atty. Ferrer-
Flores recommended the following budgets for the activities in connection with the
retirement of the Presiding Justice and Associate Justice of the Court of Appeals, subject to a
yearly increase of ten percent (10%) to cushion the effects of inflation, chargeable against
the savings from the regular appropriations of the Court of Appeals and subject further to
availability of funds:
Page 9 of 141
Case Digests
1) For a retiring Presiding Justice — not to exceed ONE MILLION TWO HUNDRED
THOUSAND PESOS (P1,200,000.00); and
2) For a retiring Associate Justice — not to exceed ONE MILLION PESOS
(P1,000,000.00).
ISSUE
Whether or not it is appropriate to grant an increase in the retirement program

budgets for the retiring members of the Court of Appeals.
RULING
YES. After a judicious consideration of all important factors, the Court deems it
appropriate to grant an increase in the retirement program budgets for the retiring members
of the Court of Appeals in the amounts of One Million Five Hundred Thousand Pesos
(PhP1,500,000.00) for a Presiding Justice and One Million Two Hundred Thousand Pesos
(PhP1,200,000.00) for an Associate Justice. These amounts are partway between Presiding
Justice Barza's proposed budgets and Atty. Ferrer-Flores's recommended budgets.
Per the Chief of the Fiscal Management and Budget Division of the Court of Appeals,
the increased retirement program budget for the retiring Presiding or Associate Justice will
cover his/her (a) luncheon/dinner reception; (b) judicial tokens; (c) miscellaneous expenses
of the En Banc Special Session; (d) souvenir for guests; and (e) food stubs for employees.
Given that the Sandiganbayan, with 421 employees, has a retirement program budget of Four
Hundred Fifty Thousand Pesos (PhP450,000.00) for each of its retiring Presiding or
Associate Justice; and the CTA, with 271 employees, has a retirement program budget of Six
Hundred Fifty Thousand Pesos (PhP650,000.00) for each of its retiring Presiding or
Associate Justice, it is justifiable that the Court of Appeals, with 1,660 employees (four and
six times more than those in the Sandiganbayan and the CTA, respectively) will need a higher
retirement program budget for its retiring Presiding or Associate Justice compared to the
two other courts.
The Court, however, refrains from granting the Court of Appeals the automatic ten
percent (10%) annual increase on its new retirement program budget purportedly to
cushion the effects of inflation. Any subsequent increase will still be subject to the review
and approval of the Court and will depend on the availability of funds and prevailing
circumstances.
Page 10 of 141
Case Digests
PHILIPPINE TRANSMARINE CARRIERS, INC., CARLOS C. SALINAS, AND/OR GENERAL

MARITIME MANAGEMENT LLC v. ALMARIO C. SAN JUAN
G.R. No. 207511, October 05, 2020, Second Division (Hernando, J.)
DOCTRINE
Settled is the rule that when a seafarer sustains a work-related illness or injury while on
board the vessel, his fitness or unfitness for work shall be determined by the company-
designated physician, and that "in case of conflicting medical assessments between the
company-designated physician and the seafarer's own physician, referral to a third doctor is
mandatory; and that in the absence of a third doctor's opinion, it is the medical assessment of
the company-designated physician that should prevail."
FACTS
PTCI, which provides marine management services, hired San Juan on several
occasions as Chief Cook from February 24, 1992 to May 15, 2008. He was re-hired on August
26, 2009 in behalf of PTCI's principal, General Maritime Management LLC, to work aboard a
vessel for 8 months. Prior to his embarkation, San Juan underwent a routine Pre-
Employment Medical Examination where he declared that he suffered from "hypertension
treated with medication." He was given cardiac clearance and was certified as "fit to work"
by PTCI's company-designated physicians.
San Juan performed hard manual labor and engaged in strenuous physical activities
for 12 hours a day. He suffered fatigue, shortness of breath, and severe headaches. This
worsened as he worked on food preparations for 3 consecutive days. He collapsed several
times due to lack of medications and medical attention. He was brought to a medical facility
in India. His attending physician issued a Medical Certificate indicating that he had high
blood pressure not controlled by the medication he is taking.
On January 23, 2010, he signed off from the vessel and was medically repatriated to
the Philippines on February 1, 2010. He was referred to the company-designated physicians
at the Metropolitan Medical Center (MMC). The attending cardiologist and neurologist
certified on April 20, 2010 and April 30, 2010 that San Juan was fit for duty.
San Juan however, was not rehired by PTCI. He applied for employment with other
manning agencies but was unsuccessful. Hence, he filed a complaint against petitioners,
seeking payment of his permanent disability benefits and sickness allowance. Subsequently,
he sought a second medical opinion from Dr. Pascual, a cardiologist from the Philippine Heart
Center, who certified that he was "medically unfit to work in any capacity as seaman."
Page 11 of 141
Case Digests
LA ordered respondents to pay complainant his permanent total disability benefit

and sickness wages. NLRC reversed. CA granted San Juan's Petition for Certiorari.
ISSUE
Whether the contrary findings of San Juan's own physician should be upheld over the
fit-to-work certifications issued by PTCI's company-designated physicians
RULING
NO. Settled is the rule that when a seafarer sustains a work-related illness or injury
while on board the vessel, his fitness or unfitness for work shall be determined by the
company-designated physician, and that "in case of conflicting medical assessments between
the company-designated physician and the seafarer's own physician, referral to a third
doctor is mandatory; and that in the absence of a third doctor's opinion, it is the medical
assessment of the company-designated physician that should prevail." Relevant to this rule
is Section 20(B)(3) of the 2000 POEA-SEC, which similarly states that "if a doctor appointed
by the seafarer disagrees with the assessment of the company-designated physician, 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."
In Marlow Navigation Philippines, Inc. v. Osias, this Court held that "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."
Both circumstances are present in this case.
However, San Juan pursued his claim without observing the laid-out procedure.
Instead of setting into motion the process of selecting a third doctor, he preempted the
mandated procedure by filing the instant complaint for permanent total disability benefits.
As held in Marlow, "absent proper compliance, the final medical report and the
certification of the company-designated physician declaring him fit to return to work must
be upheld. Ergo, he is not entitled to permanent and total disability benefits."
Page 12 of 141
Case Digests
PHILIPPINE NATIONAL BANK v. MANUEL C. BULATAO

G.R. No. 200972, December 11, 2019, Second Division (Hernando, J.)
DOCTRINE
“To establish abandonment, the employer must prove that 1) the employee must have
failed to report for work or must have been absent without valid or justifiable reason; and 2)
that there must have been a clear intention on the part of the employee to sever the employer-
employee relationship manifested by some overt act.”
FACTS
Manuel Bulatao was formerly the Senior Vice-President of the IT Group of PNB.
Bulatao alleged that Mr. Palma Gil, PNB's President, and one Mr. Roy, an Indian national,
hosted a dinner meeting for the IT staff to announce the conclusion of a Joint Venture
Agreement (JVA) between PNB and Mr. Roy. Mr. Roy announced that not all IT staff would
be retained; everyone had to undergo an International Competitive Test as a prerequisite for
absorption. Those who would not be absorbed would be offered retirement packages.
Bulatao was one of those who objected because of the supposed huge capital
exposure on PNB's end so he manifested his intent to retire in a letter dated November 10,
1999 addressed to Mr. Palma Gil.
On December 26, 1999, Bulatao had a meeting with Mr. Lucio Tan, member of the
Board, who asked him to reconsider his decision and join Mr. Tan's management team.
Hence, he went back to work on January 1, 2000. As the Board had not yet acted on his
application for retirement, Bulatao withdrew it in a Memorandum dated January 25, 2000.
On January 29, 2000, HR informed him not to report for work in February 2000 as the
Board already accepted his "resignation." Bulatao stopped reporting for work and filed a
Complaint for illegal dismissal with NLRC.
Thereafter, he received a letter dated March 23, 2000 from the Executive Vice-
President, informing him that the Board, by virtue of Resolution No. 38 of January 28, 2000,
approved and confirmed the acceptance of his resignation (as the Board treated his
application for retirement as a resignation).
The Complaint was dismissed for lack of jurisdiction; since Bulatao was an appointed
officer of a corporation, RTC has jurisdiction in accordance with RA 8799. Hence, he filed a
suit for Illegal Termination of Appointment and Damages before the RTC.
Page 13 of 141
Case Digests
The RTC concluded that Bulatao abandoned his employment when he went on
voluntary leave for 81 days from November 11, 1999 to January 31, 2000 upon submission
of a request to avail of an early retirement scheme.
The CA held that Bulatao was illegally dismissed and entitled to reinstatement and
backwages as well as damages.
ISSUE
Whether Bulatao was illegally dismissed
RULING
YES. To establish abandonment, the employer must prove that 1) the employee must
have failed to report for work or must have been absent without valid or justifiable reason;
and 2) that there must have been a clear intention on the part of the employee to sever the
employer-employee relationship manifested by some overt act.
In this case, it was clear in Bulatao's letter that he was taking an official leave of
absence following his statement that he was taking the bank's offer to retire. Moreover, while
Bulatao intended to take up the offer to retire, the circumstances surrounding such decision
was influenced by the JVA with the "Indian" group which Bulatao did not agree with. As held
by the CA, such instance did not stem from Bulatao's desire to willingly and unconditionally
cut ties with PNB but because of the JVA which he believed to be disadvantageous to the
bank.
In addition, Bulatao categorically withdrew his application to retire as mentioned in

his memorandum which he submitted before the Board "approved" his application to
"resign." Indeed, "there must be a positive and overt act signifying an employee's deliberate
intent to sever his or her employment," which is wanting. Jurisprudence pronounced that
"mere absence from work, even after a notice to return, is insufficient to prove
abandonment." In Bulatao's case, there was not even any notice to return to work. The
totality of Bulatao's acts, coupled with PNB's inaction, led to the conclusion that he did not
intend to summarily cut his ties with PNB.
Further, filing an illegal dismissal case is inconsistent with abandonment, as in his

complaint, Bulatao prayed for reinstatement. Indeed, "an employee who loses no time in
protesting his layoff cannot by any reasoning be said to have abandoned his work, for it is
already a well-settled doctrine that the filing by an employee of a complaint for illegal
dismissal with a prayer for reinstatement is proof enough of his desire to return to work,
thus negating the employer's charge of abandonment." PNB failed to show that Bulatao had
a clear and deliberate intent to sever his employment without any intention of returning.
Page 14 of 141
Case Digests
PNB failed to prove by convincing evidence that there was just or authorized cause
for terminating Bulatao from employment. Although the CA ordered reinstatement, taking
into account the lapse of time as well as the age and capacity to work of Bulatao, it is no
longer feasible. In fact, Bulatao has suffered 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.
Page 15 of 141
Case Digests
PEDRITO R. PARAYDAY AND JAIME REBOSO v. SHOGUN SHIPPING CO., INC.

G.R. No. 204555, July 06, 2020, Second Division (Hernando, J.)
DOCTRINE
“In determining the existence of an employer-employee relationship, this Court has time
and again applied the "four-fold test" which has the following elements, to wit: (a) the selection
and engagement of the employee; (b) the payment of wages; (c) the power to discipline and
dismiss; and (d) the employer's power to control the employee with respect to the means and
methods by which the work is to be accomplished.”
FACTS
Petitioners Parayday and Reboso alleged that they were employed sometime in
October 1996 and March 1997, respectively, as fitters/welders by Oceanview, a corporation
engaged in the business of ship building. Their duties and responsibilities included
assembling, welding, fitting, and installing materials or components and/or repairing and
securing parts and assemblies of Oceanview barges. They presented a copy of Parayday's
Oceanview ID, and Certificate of Employment dated February 5, 2001. Sometime in 2003,
Oceanview changed its corporate name to "Shogun Ships Inc." It maintained the same line of
business, and retained in its employ Oceanview employees.
Sometime in May 2006, petitioners were assigned to do a welding job on one of the
barges of Shogun Ships, M/T Daniela Natividad. An explosion occurred where petitioners
sustained third degree burns. They were hospitalized from May 11, 2006 until June 6, 2006.
Medical expenses were borne by respondent but petitioners were not paid their salaries
while confined. It was only after being discharged, that respondent resumed payment of their
salaries. Thereafter, Shogun Ships discontinued providing them financial assistance for
medical expenses. Subsequently, Shogun Ships verbally dismissed them from service
effective May 1, 2008 due to lack of work as fitters/welders.
Respondent denied that petitioners were engaged by Shogun Ships as regular

employees. It pointed out that Shogun Ships, a corporation engaged in domestic cargo
shipping, was only incorporated in November 2002, and that Oceanview was separate and
distinct from it. Petitioners were helpers brought in by regular employees of Shogun Ships
on certain occasions when repairs were needed. Shogun Ships compensated them for
services rendered since the work done were for the necessary repairs of its barges. In 2008,
said regular employees ceased calling helpers as they no longer needed assistance.
The LA held that petitioners were regular employees of Shogun Ships and that
respondent failed to prove that petitioners were dismissed for just or authorized cause and
that they were afforded procedural due process. The NLRC affirmed.
Page 16 of 141
Case Digests
The CA set aside the NLRC Decision and Resolution, concluding that petitioners failed
to adduce substantial evidence to prove the existence of an employer-employee relationship.
Hence, there was no dismissal to speak of, much more any illegal dismissal.
ISSUES
1) Whether petitioners were regular employees of Shogun Ships; and

2) Whether petitioners were validly dismissed from employment
RULING
1. YES. In determining the existence of an employer-employee relationship, this Court

has time and again applied the "four-fold test" which has the following elements, to wit: (a)
the selection and engagement of the employee; (b) the payment of wages; (c) the power to
discipline and dismiss; and (d) the employer's power to control the employee with respect
to the means and methods by which the work is to be accomplished.
The application of the four-fold test shows that an employer-employee relationship

did exist between petitioners and Shogun Ships. Respondent did not categorically deny the
following: that in May 2006, petitioners were engaged by respondent to work on repairs on
one of its barges, M/T Daniela Natividad; that petitioners worked for Shogun Ships until they
were verbally dismissed on May 1, 2008; that petitioners were duly compensated for any
work done; that Shogun Ships provided petitioners’ financial assistance while confined; that
Shogun Ships continued to pay their salaries after they being discharged from
hospitalization; and that petitioners were verbally dismissed on May 1, 2008. In fact,
respondent's alleged that petitioners' "work to repair was only done when there is work
available. Once the repair was done, petitioners were paid for work done, and it ends there."
This lends credence to petitioners' assertions that Shogun Ships: 1) engaged them as
employees; 2) paid their salaries for services rendered; and 3) had ultimate discretion to
dismiss their services after the needed repairs on the barges were carried out. As regards
Shogun Ship's power of control, the control test calls merely for the existence of the right to
control the manner of doing the work and not the actual exercise of the right.
Considering that petitioners were working on the barges alongside regular

employees and that they were taking orders from its engineers as to how the barges of
Shogun Ships should be repaired, it may be logically inferred that Shogun Ships had the right
to control the work of petitioners.
In sum, petitioners have proven by substantial evidence that they were regular
employees of Shogun Ships.
Page 17 of 141
Case Digests
2. NO. It is an established principle that the dismissal of an employee is justified

where there was a just cause and the employee was afforded due process prior to dismissal.
The burden of proof to establish these twin requirements is on the employer. Here,
respondent was unable to discharge the burden of proof required.
Records failed to show that respondent afforded petitioners due process prior to their
dismissal. They were merely verbally dismissed, and were thus not served notices informing
them of the grounds for dismissal. Clearly, petitioners' dismissal was not carried out in
accordance with law and was, therefore, illegal.
Page 18 of 141
Case Digests
ARLENE PALGAN v. HOLY NAME UNIVERSITY AND/OR FR. FRANCISCO ESTEPA,

SVD/FR. ERNESTO LAGURA, SVD
G.R. No. 219916, February 10, 2021, Third Division (Hernando, J.)
DOCTRINE
“We have laid down in Lacuesta the following requisites before a private school teacher
acquires permanent status: 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.
It must be stressed that only a full-time teaching personnel can acquire regular or
permanent status. A part-time teacher cannot acquire permanent status.”
FACTS
Petitioner started working as a Casual or Assistant Clinical Instructor for 2 semesters

for S.Y. 1992-1993 in HNU's College of Nursing while awaiting the results of her Nursing
Board Examination. Upon her hiring, HNU did not inform her of the standards for the
evaluation of her satisfactory completion of her probationary period.
In the second semester of S.Y. 1994-1995, she was hired as a full-time Clinical
Instructor until S.Y. 1998-1999, and was assigned at the Medical Ward. During the second
semester, she was transferred to the Guidance Center as a Nursing Guidance Instructor. She
was elected as Municipal Councilor of Carmen, Bohol. Upon her reelection for the 2001-2004
term, she took a leave of absence from HNU.
In 2004, petitioner rejoined HNU and was given a full-time load for the S.Y. 2004-
2005. 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.
Arlene argued that since she taught at HNU for more than 6 consecutive regular
semesters, she already attained the status of a regular employee pursuant to the Manual of
Regulations for Private School Teachers. There having been no valid or justifiable cause for
her dismissal, 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
Page 19 of 141
Case Digests
petitioner was not dismissed; rather, her contract of employment merely expired on March
31, 2007.
For S.Y. 1995-1996, 1996-1997 and 1997-1998, Arlene received letters of

appointment for each and every semester, with definite dates of commencement and end of
her employment. Thus, when her probationary appointment for the period June 1, 1997 until
March 31, 1998 expired, HNU was not obliged to renew her contract.
ISSUE
Whether petitioner was illegally dismissed
RULING
NO. The governing law for the employment status of teachers/professors/instructors

are the manuals of regulations for private schools. In 1992, then DECS issued the Revised
Manual of Regulations for Private Schools (1992 Manual), which covered all employees in all
levels of private educational institutions.
In Lacuesta v. Ateneo de Manila University, We held that the Manual of Regulations

for Private Schools and not the Labor Code determines whether a faculty member in a private
educational institution has attained a permanent or regular status.
Here, petitioner did not meet the criteria required to be considered as a permanent
employee. We have laid down in Lacuesta the following requisites before a private school
teacher acquires permanent status: 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.
These requisites find basis in Sections 92 and 93 of the 1992 Manual.
While petitioner 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 full-time teaching personnel can acquire regular or permanent status. A part-time
teacher cannot acquire permanent status.
Petitioner was a part-time lecturer before she was appointed as a full-time instructor
on probation. As a part-time lecturer, her employment as such had ended when her contract
expired. Thus, the three semesters she served as part-time lecturer could not be credited to
her in computing the number of years she has served to qualify her for permanent status.
Thus, given that petitioner was not a full-time teaching personnel, she could not have
acquired permanent status no matter the length of her satisfactory service.
Page 20 of 141
Case Digests
Further, petitioner was never qualified to be a full-time faculty due to the apparent
lack of the required clinical experience under the governing law and its relevant regulations.
Petitioner's experience as clinical instructor cannot be considered as "clinical practice
experience" as there is no substantial evidence that would prove that she actually engaged
in activities that may be considered as clinical practice within the ambit of the law.
Therefore, petitioner was not illegally dismissed since no dismissal occurred in the
first place. Her fixed-term contract merely expired.
Page 21 of 141
Case Digests
OMANFIL INTERNATIONAL MANPOWER DEVELOPMENT CORPORATION V.

ROLANDO B. MESINA
G.R. No. 217169, November 4, 2020, Third Division (Hernando, J.)
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.
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.
FACTS
Petitioner Omanfil International Manpower Development Corporation hired Rolando

Mesina for an overseas work as an Expediter. Omanfil deployed him to petitioner Modh Al-
Zoabi Technical Projects Corporation (MAZTPC) with a particular job assignment at Al Khaji
Joint Operations (AKJO) in Dammam, Saudi Arabia. Mesina’s employment contract provides
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 and was
confined twice at a local hospital. His severe chest pain was diagnosed as a heart disease but
he was discharged as his health was regarded "in good condition." According to petitioners,
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, Mesina claimed that against his will, MAZTPC requested AKJO to
immediately repatriate him due to his serious medical condition and on Feb of 2006 Mesina
was repatriated. Mesina sought reimbursement for his medical expenses, however,
petitioners 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 and maintained that Mesina's heart ailment could not have been work-related
Page 22 of 141
Case Digests
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.
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 petitioners. The LA dismissed
Mesina’s claim for illegal dismissal with NLRC affirming the same findings. However, the CA
found that petitioners herein illegally dismissed Mesina when his contract was pre-
terminated and he was repatriated back to the Philippines without any just or authorized
cause.
ISSUE
Whether respondent was illegally dismissed
RULING
YES. The Court held that 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. MAZCO repatriated Mesina to the
Philippines without any showing that he had a prolonged and permanent disease. Thus,
when Mesina was repatriated on February 21, 2006, 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.
The CA therefore properly held that petitioners failed to comply with the provisions
of Mesina's Employment Agreement/Contract, and with the provisions of Article 284 of the
Labor Code and Section 8, Rule I of the Omnibus Rules Implementing the Labor Code. Had
they done so, Mesina's Ischaemic Heart Disease could have been considered as an authorized
cause for his dismissal.
The Court finds 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., it was held that "it is not required that the
Page 23 of 141
Case Digests
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.”
Secondly, this Court finds that 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
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.
Page 24 of 141
Case Digests
MARLOW NAVIGATION PHILS. V. HEIRS OF ANTONIO O. BEATO

G.R. No. 233897. March 9, 2022, Second Division (Hernando, J.)
DOCTRINE
Case law has held time and time again that for a disease not included in the list of
compensable diseases to be compensable, the seafarer still has to establish, by substantial
evidence that his illness is or was work-related. As stated, the disputable presumption does not
amount to an automatic grant of compensation.
FACTS
Antonio Beato was a seafarer engaged by Marlow Navigation Phils., Inc., for and in
behalf of its foreign principal, Marlow Navigation Co. Ltd., as an Able Seaman on board the
vessel MV Geest Trader for a contract period of 10 months. 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 on December 1,
2012 due to his medical condition. Petitioner referred Beato to the company-designated
physician and company specialists. Beato was diagnosed with hypertension secondary to
upper respiratory tract infection and was advised to return for further treatment.
Antonio went home to Aklan and was confined twice in a clinic and was diagnosed
with functional dyspepsia and then with pancreatic cancer. After his discharge, Antonio was
bedridden at home until his death in April 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 benefits,
payment for burial expenses, reimbursement of medical expenses, airfare expense, damages
and attorney's fees, against Marlow on the ground that the cause of his death, pancreatic
cancer, 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 to 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 LA dismissed Antonio’s heirs’ claim for illegal dismissal with the NLRC affirming
the same findings. However, the CA overturned the LA’s and NLRC’s rulings and held that the
heirs of the late Antonio are entitled to death benefits under existing law and jurisprudence.
Page 25 of 141
Case Digests
ISSUE
Whether the death of the late Antonio is compensable
RULING
NO. By law, the seafarer's disability benefits claim is governed by Articles 191 to 193,
Chapter VI (Disability Benefits) of the Labor Code, in relation to Rule X, Section 2 of the Rules
and Regulations Implementing the Labor Code. By contract, it is governed by the
employment contract which the seafarer and his employer or local manning agency executes
prior to employment, and the applicable Philippine Overseas Employment Administration-
Standard Employment Contract (POEA-SEC) deemed incorporated in the employment
contract. Lastly, the medical findings of the company-designated physician, the seafarer's
personal physician, and those of the mutually-agreed third physician, pursuant to the POEA-
SEC, govern.
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. Section 20-A of the
2010 POEA-SEC 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.
As regards those diseases not otherwise considered an occupational disease under

the POEA-SEC, the law recognizes that these illnesses may nevertheless cause or aggravate
the seafarer's working conditions. Hence, the POEA-SEC provides for a disputable
presumption of work-relatedness for non-POEA-SEC-listed occupational diseases and the
resulting illness, injury or death that the seafarer may have suffered during the term of his
employment contract. 26 The non-inclusion of the disease in the list of compensable diseases
does not mean absolute exclusion from disability benefits. However, the disputable
presumption does not also signify an automatic grant of compensation and/or benefits
claim; the seafarer must still prove his entitlement to disability benefits by substantial
evidence of his illness' work-relatedness.
Thus, to be entitled to benefits under Section 20-A, the seafarer must show that (1)
he suffered an illness; (2) during the term of his employment contract; (3) he complied with
the procedures prescribed under Section 20-A of the applicable POEA-SEC; (4) his illness is
one of the enumerated occupational diseases or that his illness or injury is otherwise work-
related; and (5) he complied with the four conditions enumerated under Section 32-A of the
POEA-SEC for an occupational disease or a disputably-presumed work-related disease to be
Page 26 of 141
Case Digests
compensable: 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.
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. When he was asked to report back on January 8,
2013 for a follow-up check-up, not only did Antonio fail to do so, he also failed to notify in
writing Marlow or Dr. Hosaka that he had already gone home to Aklan. The only defense the
heirs gave was that Antonio's worsening condition prevented him from doing so. The law is
clear, however, that all that Antonio or his family had to do was make a written notification
of his hospitalization, or his physical incapacity to report back to the company-designated
physician. This they did not do.
Paragraph 4 of the same section further states that if the doctor selected by the
seafarer disagrees with 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, he (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 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.
Pancreatic cancer is not an occupational disease. Although the CA afforded Antonio

the benefit of the legal presumption of work-relatedness, the Court disagrees and holds that
Antonio or his heirs failed to prove the work-relatedness of his pancreatic cancer. Case law
has held time and time again that for a disease not included in the list of compensable
diseases to be compensable, the seafarer still has to establish, by substantial evidence that
his illness is or was work-related. As stated, the disputable presumption does not amount to
an automatic grant of compensation. In this case, Antonio failed to prove that his illness is
compensable as he failed to satisfy all the conditions under Section 32-A. The two studies
Page 27 of 141
Case Digests
presented by the heirs could not serve as sufficient proof that Antonio's working conditions
caused, contributed to the development of, or aggravated his pancreatic cancer since they
are simply generalizations that infer mere possibilities but not the probability required by
law for disability or death compensation. The studies only made general statements about
hazards that may typically attach to the duties of a seafarer. However, the specific risks which
a seafarer may be exposed to in the performance of his duties will still depend on the specific
duties which he may be tasked to perform.
The NLRC also noted that no scintilla of evidence was presented by the heirs to
establish the symptoms which Antonio complained of, and which eventually led to the
disease that he contracted allegedly as a result of his work. Not a single medical certificate
or laboratory report was presented by the complainants, thus, they failed to comply with the
mandatory requirements provided under the afore-stated Sec. 32 of the POEA SEC.
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.
Page 28 of 141
Case Digests
EDGARDO I. MABALOT V. MAERSK-FILIPINAS CREWING, INC

G.R. No. 224344, September 13, 2021, Second Division (Hernando, J.)
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.
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.
FACTS
Mabalot was deployed as Able Seaman by Maersk-Filipinas Crewing, Inc. to its foreign
principal A.P. Moller A/S on board "Maersk Stepnica" for a period of six months. The results
of his pre-employment medical examination showed that Mabalot was fit for sea duty. In July
2011, he complained to the ship master that he was experiencing pain on his left shoulder.
He was thus advised to seek medical treatment upon the ship's arrival at the port of Japan
and was diagnosed with "Omarthritis. He was medically repatriated on October 15, 2011 and
was advised to consult Dr. Natalio G. Alegre II, the company-designated physician for
Maersk-Filipinas Crewing, Inc., for a more thorough evaluation and treatment. Mabalot was
assessed by Dr. Alegre to be suffering from “Frozen Shoulder”.
Mabalot informed Dr. Alegre that he wished to seek 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 and
issued a Grade 11 interim disability assessment on Mabalot. 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. Mabalot then 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 because despite the continuous medical
treatment provided for by the company-designated physician for more than 120 days, he
was still unfit to work as a seafarer as he could no longer raise his left arm and shoulder.
The LA held that Mabalot was entitled only to disability benefits corresponding to
Grade 11 as assessed by Dr. Alegre however, the NLRC modified the Decision of the LA and
Page 29 of 141
Case Digests
granted the latter’s appeal. The CA then reversed the NLRC Decision and reinstated the ruling
of the arbiter adjudging Mabalot entitled only to Grade 11 partial disability benefits.
ISSUE
Whether petitioner is entitled to permanent total disability benefits
RULING
NO. The entitlement of a seafarer on overseas employment to disability benefits is

governed by law, the parties' contracts, and the medical findings of the company-designated
physician, the seafarer's physician of choice and the opinion of the third doctor. Since
Mabalot's contract of employment with respondents was executed in 2011, the 2010
Philippine Overseas Employment Administration-Standard Employment Contract (POEA-
SEC) governs the procedure for his claim of disability benefits which provides that 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 as 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 final, conclusive, and definite medical assessment must clearly state the seafarer's
fitness to work or his exact disability rating, or whether such illness is work-related, and
without any further condition or treatment. It should no longer require any further action
on the part of the company-designated physician and it is issued by the company-designated
physician after he or she has exhausted all possible treatment options within the periods
allowed by law. To stress, 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 on February
2, 2012, or 110 days from Mabalot's repatriation, was merely an interim diagnosis. The
Page 30 of 141
Case Digests
Medical Report clearly states so, thus, it cannot be considered as a definite and final
assessment. This is supported by the fact that Dr. Alegre still advised Mabalot to continue
with his physical therapy, seek consultation with a Rehabilitation Medicine Specialist and
report back on February 10, 2012 for a follow-up check-up.
The failure of Dr. Alegre to issue a complete and definite medical assessment within
the 120-day period did not automatically render Mabalot's disability as total and permanent.
To reiterate, the February 2, 2012 Medical Report stated that Mabalot needed to continue
physical therapy and seek consultation with a Rehabilitation Medicine Specialist. Thus,
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.
In this case, instead of heeding the advice of Dr. Alegre, Mabalot opted to consult Dr.
Jacinto on March 5, 2012 who then diagnosed Mabalot unfit to work due to permanent total
disability. On even date, or 142 days after his medical repatriation but within 240 days
therefrom, Mabalot filed the Complaint for recovery of permanent total disability benefits,
moral and exemplary damages, and attorney's fees. Clearly, Mabalot's Complaint was
prematurely filed as his cause of action had yet to accrue. The company-designated doctor
still had a remaining period within which to give his definitive assessment on his medical
condition or fitness to return to work.
In addition, Mabalot cannot rely on the Medical Certificate issued by his physician of
choice, Dr. Jacinto. The rule is that while a seafarer has the right to seek the opinion of other
doctors, such right may be availed of on the presumption that the company-designated
doctor had already issued a definite declaration on the medical condition of the seafarer, and
the seafarer finds it disagreeable. Given the lack of certification from the company-
designated doctor, Mabalot cannot rely on the assessment made by his own doctor.
Hence, the appellate court was correct in reinstating the ruling of the LA which
awarded Mabalot compensation corresponding only to Grade 11 disability rating. The Court
gives weight to this finding as neither party refuted that the company-designated doctor
indeed made such diagnosis within the allowable period for him to do so.
Page 31 of 141
Case Digests
NINIA P. LUMAUAN V. COMMISSION ON AUDIT

G.R. No. 218304, December 9, 2020, En Banc (Hernando, J.)
DOCTRINE
Under the rules on return of disallowed amounts as espoused in Madera, and applying
the civil law principles on solutio indebiti and unjust enrichment, recipients — whether
approving or certifying officers or mere passive recipients, are all liable to return the disallowed
amounts respectively received by them, unless they are able to show that the amounts they
received were genuinely given in consideration of services rendered. To emphasize, payees who
receive undue payment, regardless of good faith, are liable for the return of the amounts they
received.
FACTS
Petitioner Ninia P. Lumauan was the Acting General Manager of Metropolitan

Tuguegarao Water District (MTWD), a government-owned and controlled corporation
(GOCC). In 2009, the Board of Directors of MTWD issued Board Resolution Nos. 2009-0053
and 2009-0122, approving the payment of accrued Cost of Living Allowance (COLA) to
qualified MTWD employees for calendar years (CYs) 1992 to 1997 in the aggregate amount
of P1,689,750.00. However, after post-audit, Supervising Auditor Floricen T. Unida and Audit
Team Leader Basilisa T. Garcia issued Notice of Disallowance disallowing the payment of
P1,689,750.00 for lack of legal basis specifically since the COLA was already deemed
integrated into the basic salary of the employees pursuant to Section 12 of RA No. 6758,
otherwise known as the Compensation and Position Classification Act of 1989, and the
Department of Budget and Management (DBM) Corporate Compensation Circular (CCC) No.
10. Held liable under the Notice of Disallowance were petitioner; Ms. Visitacion M. Rimando
(Rimando), Division Manager-Administrative; Ms. Marcela Siddayao (Siddayao), Cashier;
and the employees of MTWD, as payees.
The Regional Director denied Lumauan’s appeal who elevated the matter to
respondent COA-Commission Proper. Respondent COA-CP rendered a Decision denying the
appeal for late filing and lack of merit. Respondent COA-CP agreed with the observation of
the Regional Director that the appeal was belatedly filed. It ruled that the disallowance has
already become final and executory because petitioner belatedly filed the Appeal
Memorandum or 12 days from receipt of the Decision of the Regional Director. Besides, even
if the appeal was timely filed, respondent COA-CP ratiocinated that the appeal should still be
denied because petitioner's arguments were bereft of any merit.
ISSUE
Page 32 of 141
Case Digests
Whether respondent COA-CP committed grave abuse of discretion in disallowing the

payment of COLA for CYs 1992-1997 to the employees of MTWD
RULING
NO. The Court finds that the grant of accrued COLA for CYs 1992 to 1997 was
correctly disallowed because said allowance was deemed already integrated in the
compensation of government employees under Section 12 of RA 6758. The Court further
declared that said provision was self-executing, and thus the absence of any DBM issuance
was immaterial. The clear policy of Section 12 is "to standardize salary rates among
government personnel and do away with multiple allowances and other incentive packages
and the resulting differences in compensation among them." Thus, the general rule is that all
allowances are deemed included in the standardized salary. However, there are allowances
that may be given in addition to the standardized salary.
The Court held that the nullification of DBM-CCC No. 10 in De Jesus does not affect the
validity of R.A. No. 6758 and reiterating that there is nothing in that decision suggesting or
intimating the suspension of the effectivity of R.A. No. 6758 pending the publication of DBM-
CCC No. 10 in the Official Gazette. In Gutierrez, the Court definitively ruled that COLA is
integrated in the standard salary of government officials and employees under Sec. 12 of R.A.
No. 6758. Clearly, COLA is not in the nature of an allowance intended to reimburse expenses
incurred by officials and employees of the government in the performance of their official
functions. It is not payment in consideration of the fulfillment of official duty. As defined, cost
of living refers to "the level of prices relating to a range of everyday items" or ''the cost of
purchasing those goods and services which are included in an accepted standard level of
consumption." Based on this premise, COLA is a benefit intended to cover increases in the
cost of living. Thus, it is and should be integrated into the standardized salary rates.
Petitioner's reliance on the pronouncement of the Court in Philippine Ports Authority

Employees Hired After July 1, 1989 v. Commission on Audit, reiterated in Metropolitan
Waterworks and Sewerage System v. Bautista, that employees of GOCC, whether incumbent
or not, are entitled to COLA from 1989 to 1999, is misplaced. The Court in Maritime Industry
Authority (MIA) v. Commission on Audit 42 already clarified that the ruling in Philippine
Ports Authority (PPA) Employees Hired After July 1, 1989 v. Commission on Audit only
distinguished the benefits that may be received by government employees hired before and
after the effectivity of RA 6758. In fact, in Republic v. Judge Cortez, 43 the Court made it clear
that Philippine Ports Authority (PPA) Employees Hired After July 1, 1989 v. Commission on
Audit "only applies if the compensation package of those hired before the effectivity of
Republic Act No. 6758 actually decreased; or in case of those hired after, if they received a
lesser compensation package as a result of the deduction of COLA." 44 Such is not the
situation in the instant case.
Page 33 of 141
Case Digests
Petitioner can be held personally liable for the disallowed benefit to the extent of the
amount she actually and individually received pursuant to our ruling in Madera v.
Commission on Audit. Petitioner is only a recipient or a passive payee of the allowance. She
thus falls under category 2 (c) of the rules on return which provides that: (c)Recipients —
whether approving or certifying officers or mere passive recipients — are liable to return
the disallowed amounts respectively received by them, unless they are able to show that the
amounts they received were genuinely given in consideration of services rendered.
Under the rules on return of disallowed amounts as espoused in Madera, and applying
the civil law principles on solutio indebiti and unjust enrichment, "recipients — whether
approving or certifying officers or mere passive recipients," like petitioner Madera in this
case, are all "liable to return the disallowed amounts respectively received by them, unless
they are able to show that the amounts they received were genuinely given in consideration
of services rendered." To emphasize, "payees who receive undue payment, regardless of
good faith, are liable for the return of the amounts they received.” As stated, as an exception
to this rule, a payee or recipient may be excused from returning the disallowed amount when
he/she has shown that he/she was "actually entitled to what he/[she] received" or "when
undue prejudice will result from requiring payees to return or where social justice or
humanitarian considerations are attendant."
However, the records showed none of the extenuating circumstances to be present.

To recall, the benefit subject in this case is accrued COLA. As pointed out by the COA,
petitioner is not entitled to said allowance because it was already incorporated in the
standardized salary rates of government employees. Neither was it established that ordering
its return would unduly prejudice petitioner. It was also not shown that social justice or
humanitarian considerations were extant to the instant case. Thus, there is no justifiable
circumstance present that would excuse petitioner from returning the disallowed benefit to
the extent of the amount she actually and individually received.
Page 34 of 141
Case Digests
LUFTHANSA TECHNIK PHILIPPINES, INC., ANTONIO LOQUELLANO

AND ARTURO BERNAL v. ROBERTO CUIZON
G.R. No. 184452. February 12, 2020, Second Division (Hernando, J.)
DOCTRINE
“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.
"Neglect of duty, as a ground for dismissal, must be both gross and habitual." 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
Petitioners 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. They point out that such loss of trust and confidence resulted from Cuizon's
numerous violations and blatant disregard of the LTP Standards in the Workplace, which
violations were committed in the course of two separate incidents, specifically:
1. Cuizon's willful concealment of the accidental light-up of PAL Aircraft EI-BZE on 10

March 2005, [accidental light-up incident] and
2. Cuizon's failure to observe the safety guidelines and precautions of petitioner LTP
with respect to aircraft towing, which caused damage to PAL Aircraft RP-C4008 on 15
April 2005 [towing incident].
The Labor Arbiter rendered a Decision dismissing Cuizon's complaint for illegal
dismissal. The NLRC likewise held that there was no illegal dismissal in respect to Cuizon.
However, the CA reversed the findings of the Labor Arbiter and the NLRC and held that
Cuizon was indeed illegally dismissed.
ISSUE
Whether or not Cuizon was illegally dismissed.
RULING
Page 35 of 141
Case Digests
YES. We find that petitioners did not validly dismiss Cuizon on the ground of loss of
trust and confidence. 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 instant case, We find that petitioners failed to substantially prove the second
requisite (i.e., there must be an act that would justify the loss of trust and confidence). In
Cadavas, We have 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 an act done carelessly, thoughtlessly, heedlessly or
inadvertently,"
However, in this case, We are of the firm 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, this Court finds
that Cuizon has substantially refuted petitioners' claim on the alleged concealment of the
accidental light-up and the towing incident.
The CA found, and this Court agrees, that Cuizon could not be held guilty of
deliberately giving false, inaccurate, misleading, incomplete or delayed information to LTP
regarding the accidental aircraft engine light-up incident. We 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. We give
credence to his justification that he could not immediately conclude that there was an
accidental light-up because the same had to be eventually confirmed using a boroscope; 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.
"Neglect of duty, as a ground for dismissal, must be both gross and habitual." 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.
Page 36 of 141
Case Digests
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, We find that 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. On the contrary, We find that he performed his task in accordance with
the rules and procedures of LTP. We note that Cuizon immediately informed his supervisor,
Loquellano, through a phone call, about his findings.
Page 37 of 141
Case Digests
SALVACION A. LAMADRID v.
CATHAY PACIFIC AIRWAYS LIMITED AND VIVIAN LO
G.R. No. 200658. June 23, 2021, Third Division (Hernando, J.)
DOCTRINE
“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”
FACTS
In 1990, Cathay hired Salvacion A. Lamadrid as a cabin crew. Cathay's Conditions of

Service stipulated that all its cabin crew shall be based in Hong Kong. Prior to her termination
in 2007, Lamadrid had rendered about 17 years of service in Cathay, and held the position
of Senior Purser with a monthly salary of HK$26,613.00.
On May 19, 2007, 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 May 19,
2007 incident aboard flight CX 139 and to show cause why no disciplinary action should be
imposed against her since removal of company property without authorization is considered
a serious misconduct. Lamadrid submitted her reply-letter denying the allegations against
her. She claimed that the Hello magazine 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. Additionally, Lamadrid sent a reply-letter that she brought and
declared the bottle of Evian water as her own. She denied having committed serious
misconduct, and demanded that the items taken from her be preserved following a fair and
transparent investigation.
On July 10, 2007, 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 petitioner considering the seriousness of her violation.
Page 38 of 141
Case Digests
The Labor Arbiter found respondents guilty of illegal dismissal The NLRC concurred
as well with the arbiter that the penalty of dismissal was too harsh considering the worker's
untarnished record of 17 years, the value of property stolen, and Cathay's failure to establish
that Lamadrid was holding a managerial or a position of trust. The CA ruled that the airline
validly terminated the employment of Lamadrid on grounds of theft and dishonesty.
Regardless of the value of the property pilfered, Cathay had the right to dismiss erring
employees as a measure of protection against actions inimical to its interest. Hence this
petition.
ISSUE
Whether or not Lamadrid was illegally dismissed.
RULING
YES. Jurisprudence classify positions of trust and confidence into two categories. The
first consists of those managerial employees or those "vested with powers or prerogatives
to lay down and execute management policies and/or to hire, transfer, suspend, lay-off,
recall, discharge, assign or discipline employees" as defined under Article 219 of the Labor
Code. By the nature of their position, managerial employees are expected to exhibit utmost
fidelity to the employer as they are entrusted with confidential and sensitive matters. 53 The
second category involves those who in the normal and routine exercise of their functions
regularly handle significant amounts of the employer's money or property, such as but not
limited to cashiers, auditors, and property custodians.
Based on the Affirmation of Kevin, the Cabin Crew Line Manager of Cathay, the nature
of Lamadrid's duties and obligations required the highest degree of trust and confidence
because she had in her control properties of Cathay. The Affirmation specifically
demonstrates in detail:
“12. In the management of the section of aircraft she [Lamadrid] is responsible for,
she is basically unsupervised as she is empowered by the ISM to assist by overseeing the
service and ensuring the Company's property is protected that no items of Company
property are removed from the aircraft without authorization. She has custody of various
company properties in her section of aircraft such as all service equipment including
chinaware, glassware, cutlery and linenware, expensive items of Champagne, wine and
liquor, amenity kits for passenger and inflight reading materials for passengers such as
newspaper and magazines. There are long intervals of time inflight during which these
company properties are under her exclusive safekeeping and control.
13. Sally's position and duties required that the company have the highest degree of
trust and confidence in her.”
Page 39 of 141
Case Digests
Taking this Affirmation into consideration, together with the declared duties and
responsibilities of a flight attendant, We hold that indeed the nature of Lamadrid's position
was imbued with trust and confidence. She had in her custody and control company
properties which are of significant value, and she also had the responsibility of informing the
In-flight Service Manager whether there was defective or missing equipment. Moreover, she
had oversight over two to four cabin crew members assigned in her section of the aircraft
and rated their performance for promotion purposes. She had been entrusted with the
custody and control of valuable company properties in the normal and routine exercise of
her duties.
However, while the weight of evidence points to Lamadrid's infraction of company

policy, We 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.
Page 40 of 141
Case Digests
MARK ELISEUS M. VILLOLA v. UNITED PHILIPPINE LINES, INC.

and FERNANDINO T. LISING
G.R. No. 230047. October 9, 2019, Third Division (Hernando, J.)
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. As the intent
to relinquish must concur with the overt act of relinquishment, the acts of the employee before
and after the alleged resignation must be considered in determining whether in fact, he or she
intended to sever from his or her employment. 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.”
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 Villola against respondents United
Philippine Lines, Inc. (UPL), and its President, Mr. Fernandino T. Lising.
On May 15, 2013, Villola discussed with the officers of UPL the creation of a new
software system. The parties agreed that as soon as the software system is implemented,
Villola will organize a business unit which will execute the encoding, scanning and indexing
of all UPL documents. However, on May 31, 2013, Villola received an e-mail message from
Mr. Joey G. Consunji, General Manager of UPL, supposedly requiring Villola to submit to
management a written resignation letter indicating therein the effectivity date of his
resignation, i.e., June 1, 2013. Villola, on his part, did not comply with said directive and
continued reporting for work until July 2013. Meanwhile, Villola sent e-mails to Lising
demanding for payment of his unpaid salaries, allowances, and professional fees. Villola's
demands, however, remained unheeded.
Thereafter, on October 11, 2014, UPL released a Memorandum informing UPL

employees of the fact of Villola's termination of employment from UPL effective June 1, 2013.
Concomitantly, the same memorandum directed security personnel to deny Villola entry
from the company premises.
The Labor Arbiter dismissed the complaint for illegal dismissal for lack of merit.
However, the NLRC reversed the Labor Arbiter’s decision. On appeal, the Court of Appeals
Page 41 of 141
Case Digests
rendered its assailed Decision granting respondents' Petition for Certiorari and setting aside
the November 27, 2015 Decision and January 25, 2016 Resolution of the NLRC.
ISSUE
Whether or not Villola was illegally dismissed.
RULING
NO. In Machica v. Roosevelt Services Center, Inc., this Court declared that when the
employer denies dismissing the employee, the latter must prove the fact of his dismissal with
clear, positive and convincing evidence. It is a well-established rule under ordinary rules of
evidence that the party- litigant who alleges the existence of a fact or thing necessary to
establish his claim has the burden of proving the same by the amount of evidence required
by law, which, in labor proceedings, is substantial evidence, or such "evidence as a
reasonable mind might accept as adequate to support a conclusion." In this respect, this
Court, in Exodus International Construction Corp. v. Biscocho, held that while the employer
bears the burden of proof to prove that the employee's dismissal was for a valid or
authorized cause, the employee must first establish by substantial evidence that indeed he
was dismissed. If there is no dismissal, then there can be no question as to the legality or
illegality thereof.
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. As the
intent to relinquish must concur with the overt act of relinquishment, the acts of the
employee before and after the alleged resignation must be considered in determining
whether in fact, he or she intended to sever from his or her employment. 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.
At the outset, while Villola's resignation letter serves as proof of the latter's formal
relinquishment of his employment with UPL, the absence thereof is not enough to rule out
the conclusion that no resignation ever took place. On the other hand, the contemporaneous
and immediate subsequent acts of Villola after his supposed resignation from UPL should be
considered in determining if there is truth to the contention that he indeed resigned from
UPL.
In this case, we agree with the respondents that Villola resigned from his employment
and that he was not dismissed by UPL based on the following factual circumstances:
Page 42 of 141
Case Digests
First, UPL, through Consunji, requested Villola in an e-mail dated May 31, 2013 to
furnish to management his resignation letter and his proposal and quotation for its scanning
project for SVI.
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. A perusal of the proposal clearly indicate that the same was furnished to UPL under
the name "DRD Technology Solutions," an entity distinct from UPL, and was jointly prepared
by Villola and a certain Mr. Ding Dulay who appears to be neither an employee nor an
individual affiliated with UPL.
All told, this Court finds that Villola failed to discharge the burden of proof required
of him to establish that respondents indeed took action to dismiss him. Simply put, the
concurrence of Villola's resignation, coupled with his actions thereafter, ultimately support
the finding that he resigned from UPL.
Page 43 of 141
Case Digests
GERARDO U. VILLE v. MAERSK-FILIPINAS CREWING, INC. and/or A.P. MOLLERA/S

G.R. No. 217879. February 1, 2021, Third Division (Hernando, J.)
DOCTRINE
“A seafarer-claimant is mandated a period of three working days within which he should

submit himself to a post-employment medical examination so that the company-designated
physician can promptly arrive at a medical diagnosis. Due to the express mandate on the
reportorial requirement, the failure of the seafarer to comply shall result in the forfeiture of his
right to claim the compensation and benefits for injury and illness.”
FACTS
In July 2011, respondent manning agency Maersk-Filipinas Crewing, Inc. (Maersk), in

behalf of its foreign principal, respondent A.P. Moller A/S, 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. On
August 11, 2011, he departed from the Philippines to join his vessel of assignment. 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.
On March 7, 2012, 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.” Dr.
Raymund Jay Sugay, his PEME doctor, opined that Ville's heart ailment would necessitate
further evaluation and treatment. Ville then underwent a Myocardial Perfusion Scintigraphy
on April 16, 2012 at the Philippine Heart Center which confirmed that he had indeed a heart
condition.
Under the impression that he contracted the illness while on board Adrian Maersk,
Ville filed a Complaint on May 3, 2012 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.
The Arbiter found Ville entitled to disability benefits since his illness was work-
related and was acquired during the term of his contract. The Philippine Overseas
Employment Administration-Standard Employment Contract (POEA-SEC) does not require
that the illness be diagnosed during the term of the contract; it only entails that the ailment
was acquired or aggravated during the said term. The NLRC affirmed the ruling of the
Arbiter. It similarly found that Ville had effectively discharged the burden of proving that his
Page 44 of 141
Case Digests
illness is compensable. However, the CA held that the NLRC gravely abused its discretion
when it affirmed the Arbiter's ruling that Ville was entitled to disability benefits.
ISSUE
Whether or not Ville is entitled to his claim for total and permanent disability benefits.
RULING
NO. A contract between an employer and a seafarer ceases upon its completion, when
the seafarer signs off from the vessel and arrives at the point of hire." Indeed, "the
employment of seafarers and its incidents are governed by the contracts they sign every time
they are hired or re-hired. These contracts have the force of law between the parties as long
as their stipulations are not contrary to law, morals, public order or public policy." Thus,
upon Ville's signing off from the vessel and repatriation on March 1, 2012 due to the
completion of his contract, his employment relationship with the respondents
correspondingly ceased. Consequently, no liability should attach to the respondents for any
illness or incident that may have been acquired or transpire after signing off or expiration of
his contract, as in this case.
Even on the assumption that Ville's illness is work-related and that the same was
acquired on-board and during the term of his employment contract, his suit for disability
benefits would still fail due to his non- compliance with the three-day reportorial
requirement upon repatriation.
A seafarer-claimant is mandated a period of three working days within which he

should submit himself to a post-employment medical examination so that the company-
designated physician can promptly arrive at a medical diagnosis. Due to the express mandate
on the reportorial requirement, the failure of the seafarer to comply shall result in the
forfeiture of his right to claim the compensation and benefits for injury and illness.
There is no dispute that Ville never reported to his employer that he was suffering
from an ailment while on board Adrian Maersk. Additionally, 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 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.
Furthermore, even assuming that Ville acquired an illness while on board, that he
informed respondents, and then underwent a post-employment medical examination within
three days from repatriation, his claim for disability benefits would still fail because he did
Page 45 of 141
Case Digests
not secure the medical opinion of the company-designated physician before consulting his
own doctor in accordance with Section 20 (A) (3) of the 2010 POEA-SEC. His failure to do so
bars him from claiming disability benefits. Without these assessments, his suit for disability
benefits was filed prematurely.
Page 46 of 141
Case Digests
V MANPOWER PHILS., INC., AND/OR CAPE PNL LTD v. DOMINADOR C. BUQUID

G.R. No. 222311, February 10, 2021, Third Division (Hernando, J.)
DOCTRINE
Notwithstanding the evolution of how the POEA defines a "seafarer," the same should
still be read with Article 13(g) of the Labor Code, which contains the legal definition that may
not be expanded or limited by mere administrative rules or regulations. Indeed, all the
definitions mentioned would all point to the fact that 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.
FACTS
In 2012, petitioner V People Manpower Phils., Inc. hired Dominador, for and in behalf
of its principal, Cape Papua New Guinea Ltd. (Cape PNG) as a Deck Crew/Rigger or an
estimated period of six (6) months, from January 17, 2012 to July 17, 2012, or up to the
completion of a phase of a project or upon completion of the KUMUL Marine Terminal
Rejuvenation Works (KUMUL Project), the site of which is located in Papua, New Guinea.
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, March 27,
2012, he was brought to a hospital where he underwent an appendectomy. Dominador was
discharged and repatriated to the Philippines.
After several check-ups and a series of laboratory procedures, he was diagnosed with
Stage 3 Colon Cancer.
Asking for second opinion, Dr. Jhade Lotus P. Peneyra issued 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.
Considering these medical findings, 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.
Page 47 of 141
Case Digests
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. Thus, it
came as a surprise that Dominador was claiming disability benefits as a seafarer and not as
a land-based worker because it further alleged that Dominador was assigned to work as a
deck crew/rigger in the Kumul Platform located 40 kilometers off the southern coast of
Papua New Guinea, and thus, contrary to his claims, he was never assigned to work in any
ship in any capacity.
Labor Arbiter held that Dominador was employed as a seafarer whose illness is
compensable under the POEA-SEC. It held that the nature of his employment on board as
well as the actual conditions of his work qualifies him as a seafarer.
NLRC reversed the ruling of the Labor Arbiter and ruled that Dominador was a land-
based employee and not a seafarer as he was employed as deck crew/rigger on an offshore
oil rig, which is not a ship.
CA set aside the decision of NLRC and reinstated LA's ruling.
ISSUE
Whether Dominador Buquid is a seafarer who is entitled to permanent and total

disability benefits found in POEASEC.
RULING
NO. The Supreme Court held that Article 13(g) of the Labor Code defines a "seaman"
as follows: (g) "Seaman" means any person employed in a vessel engaged in maritime
navigation.
It is implied from the above definition that the capability of a vessel to engage in
maritime navigation is crucial in determining whether one can be considered as a "seaman"
(the term used prior to the more gender-neutral "seafarer") under the ambit of our Labor
Code.
The new definition under the 2016 POEA Seafarer Rules closely resembles the
original definition found in Article 13(g) of the Labor Code. Fishermen, cruise ship personnel,
or mobile offshore and drilling units were no longer mentioned. 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.
Page 48 of 141
Case Digests
It must be emphasized that notwithstanding the evolution of how the POEA defines a
"seafarer," the same should still be read with Article 13(g) of the Labor Code, which contains
the legal definition that may not be expanded or limited by mere administrative rules or
regulations. Indeed, all the definitions mentioned would all point to the fact that 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.
As applied in the case, it is evident that Dominador, despite allegedly being a seafarer
for 22 years, was not engaged as a seafarer but as a land-based worker in his latest
employment contract with petitioners.
Even if we consider the definition under the 2010 POEA Seafarer Rules, which was
the prevailing set of rules during Dominador's employment period with petitioners, he never
presented any evidence that he was aboard any vessel engaged in maritime navigation, or a
mobile offshore rig or drilling unit in the high seas.
Contrary to the allegations of Dominador, "M/V KML Platform" does not exist and has
no basis in the body of evidence presented before us. There is no mention of such a marine
vessel in the employment contract between him and petitioners, nor was there any proof
presented to show that a marine vessel was registered under the said name. The
employment contract simply mentioned that he will be hired as a project employee for the
KUMUL Project and that the work site is located in Papua, New Guinea.
Dominador is a land-based worker and therefore not under the ambit of the laws and
regulations covering seafarers. However, even assuming for the sake of argument that
Dominador is a seafarer, the evidence on record is not enough to conclude that his medical
condition (Stage 3 Colon Cancer) was caused or at least aggravated during the two months
he has worked for petitioners.
Page 49 of 141
Case Digests
UNIVERSITY OF THE CORDILLERAS, DR. RICARDO PAMA, DR. CLEOFAS M. BASEN, DR.
MIRIAM A. JANEO v. BENEDICTO F. LACANARIA
DOCTRINE
The seriousness of a student's cough or even his alleged pretension of being severely ill
are not the real issues but the utterance of remarks unbecoming of an educator. It was not
proper to speak to a student in a manner of anger and dissatisfaction in wordings, especially in
a classroom setting or even within the school grounds where it is clear that the petitioner was
acting in his capacity as a professor.
FACTS
University of the Cordilleras employed Benedicto Lacanaria as an Instructor-

Associate Professor at the College of Teacher Education.
On February 25, 2010, during a scheduled creative presentation for Lacanaria's class,
one of his students, Rafael Flores, did not join in the dance portion of their group number,
although he participated in the singing and acting parts.
Apparently, Flores had a persistent cough but he attended the class since an absence
would yield a grade of zero for the performance. Because Flores did not join in the dance
segment, Lacanaria instructed him to still dance to be fair to the whole group. However, while
Flores was dancing, his knees suddenly gave out which caused him to fall to the floor close
to the wall. His groupmates assisted him by giving him a drink and helping him cool down.
Lacanaria did not pay much attention to what happened and instead instructed the next
group to perform.
Since he did not feel well, Flores requested from Lacanaria to permit him to proceed
to the clinic. However, the professor told him, "umupo ka muna dyan, hindi ka pa naman
mamamatay." Regardless, Flores repeated his request. Lacanaria eventuy allowed him to go
to the clinic with a classmate but instructed him to return after his consultation. As the doctor
was not yet around, the clinic's nurse told Flores to eat lunch first and return later. Instead,
Flores headed home and was eventually brought to the Notre Dame Hospital where he was
diagnosed to have "costochondritis and upper respiratory tract infection."
Flores returned to school and sought Lacanaria to report what had happened to him.
However, when Lacanaria saw Flores at the stairs, the former said "tae mo!" and then left.
Flores filed a written complaint. Lacanaria, in his Answer, said that he found nothing
alarming and that Flores was merely covering up his failure to do his part in the performance.
Page 50 of 141
Case Digests
He further explained that he said "tae mo!" with no malice and reasoned that it was not a
humiliating statement.
ISSUE
Whether the petitioner's wordings and actions constitute serious misconduct.
RULING
YES. There are two aspects to due process under the Labor Code: first, substantive -
the valid and authorized causes of termination of employment under the Labor Code; and
second, procedural - the manner of dismissal.
On substantive due process, an employer may only dismiss an employee upon just or
authorized causes and has the burden to prove that the dismissal was valid. If the employer
fails to meet this burden, the conclusion would be that the dismissal was unjustified, and,
therefore, illegal.
In the case at bench, the following instances demonstrated how Lacanaria's

misconduct amounted to something grave and not merely trivial, considering his position as
a professor: (a) he acknowledged that Flores had a persistent cough during the class but
shrugged it off; (b) he did not act when Flores' legs gave out and prevented the other students
from helping him; (c) he dismissed Flores' condition as an act of pretension, showing that he
had no intent to ascertain the well-being of his student; (d) he uttered "maupo ka muna dyan,
hindi ka pa naman mamamatay" which reeked of insensitivity and lack of empathy; (e) he
did not immediately allow Flores to go to the clinic despite prior knowledge of Flores' cough;
(f) he replied "tae mo!" when Flores tried to explain what happened, which showed
tastelessness and unprofessionalism; (g) he blamed Flores for attending his class despite
knowing that students would normally opt to attend and perform in order not to get a failing
grade in spite of sickness; (h) he downplayed Flores' condition in his Answer, stating that
the clinic's nurse only gave Flores a tablet and asked him to go back later since the doctor
was unavailable, also notwithstanding the issuance of a medical certificate by the hospital
which properly diagnosed Flores with an illness connected to his cough; and (i) his
comments regarding the video clip exhibited his uncaring attitude and thoughtlessness even
though Flores likely needed medical attention at the time.
Indisputably, the incident was associated with Lacanaria's work 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 uttered
those words with full knowledge that he was conversing with a student whom he exercises
Page 51 of 141
Case Digests
authority over. Hence, he failed to display professionalism and decency in dealing with his
students.
Due to his shameful behavior, the Labor Arbiter and the NLRC additionally considered
the principle of "totality of infractions" in ruling that Lacanaria was validly dismissed. The
totality of an employee's infractions is considered and weighed in determining the imposable
sanction for the current infraction." It is undisputed that Lacanaria has been warned in the
past, verbally and in writing, as regards his delivery of "green jokes" in class.
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 as part of the university's management prerogative.
On the other hand, to comply with procedural due process and validly dismiss an
employee, the employer is required to follow the two-notice rule. In general, "[f]irst, 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."
In the case at bench, The Charge Sheet with Notice of Investigation charged Lacanaria
with serious misconduct and a violation of the Code of Ethics for Professional Teachers then
enumerated the imposable penalties without however specifying which provisions were
violated.149 Nonetheless, he was purportedly provided with a copy of Flores' Complaint and
other documents which supplemented the details and reason for the charges. Relevantly, 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 hearings thus he was not
able to attend the same.
It is settled that "actual hearing or conference is not a condition sine qua non for
procedural due process in labor cases.
It should be emphasized that 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. This is considering that he was not
able to attend the previous hearings as he was not duly informed of the schedule.
Page 52 of 141
Case Digests
TELUS INTERNATIONAL PHILIPPINES, INC AND MICHAEL SY v. HARVEY DE GUZMAN

G.R. No. 202676, December 4, 2019, Second Division (Hernando, J.)
DOCTRINE
In case of a constructive dismissal, the employer has the burden of proving that the
transfer and demotion of an employee are for valid and legitimate grounds such as genuine
business necessity. Particularly, for a transfer not to be considered a constructive dismissal, the
employer must be able to show that such transfer is not unreasonable, inconvenient, or
prejudicial to the employee; nor does it involve a demotion in rank or a diminution of his
salaries, privileges and other benefits.
FACTS
Telus alleged that it first hired respondent Harvey De Guzman sometime in

September 2004 as Inbound Sales Associate.
His last post prior to the controversy was Senior Quality Analyst for DELL After Point
of Sale.
On August 2, 2008, Telus received an escalation complaint from Jeanelyn Flores,

Team Captain of DELL APoS, charging De Guzman of disrespect and ridicule towards a
person.
The escalation complaint alleged that on July 31, 2008, Flores, while in the process of
checking the work progress of all the agents to determine if coaching was required to
improve their performance, sent a chat message to Quality Analysts (QA) directing them to
do coaching. She messaged: "QAs there are tons of avails, do your coaching ."
De Guzman, who was among the QAs who received the message, replied: "that is good,
you can now do your huddle for your team."
Later on, she chanced upon the August 1, 2008 IP switch conversation between De
Guzman and a fellow agent, Rally Boy Sy (Rally Boy), wherein De Guzman made disrespectful
remarks against her.
Acting on the complaint of Flores, Telus, on August 4, 2008, issued a Due Process form
to De Guzman on charges of "[i]nsulting or showing discourtesy, disrespect, or arrogance
towards superiors or co-team members [and a]busive behavior language which is outside
the bounds of morality." De Guzman was placed in preventive suspension.
Page 53 of 141
Case Digests
Telus conducted an administrative hearing on the matter. Upon termination of the

investigation, Telus found De Guzman's not liable for the offenses charged and did not
impose any disciplinary sanction against him. Telus, however, decided to remove De Guzman
from his current designation and transfer him to another practice and he and Rally Boy were
to report the next day in Market Market, BGC Branch. However, they were told to report back
to Ortigas and told that Telus still needed to find an account for them. Hence, they did not
have any work yet despite the lifting of their suspension.
In his desire to keep his job and to receive his salary, De Guzman exhausted his earned
vacation leaves. He was told that he was considered as a "floater" and he will not get paid
unless his floating status has been lifted.
De Guzman alleged that he was shocked that he was being penalized for the exchange
of messages he shared with Rally Boy without first affording him any opportunity to give his
side of the story. He filed a case for constructive dismissal.
ISSUE
Whether the actions of Telus against De Guzman constitute illegal dismissal.
RULING
YES. The series of actions done by Telus manifests that De Guzman was terminated
in disguise and such actions amount to constructive dismissal.
First, after finding petitioner not liable for the offense charged, respondents did not
immediately reinstate petitioner to his former position. Second, private respondents
informed petitioner that he was being transferred to a new account and directed to report
to the Telus' branch office at Market Market, Global City, Taguig City. However, after a few
hours, respondents asked petitioner to just go home and wait since they needed time to
search for his account. While waiting for the promised new account, petitioner was
compelled to utilize his leave credits. Third, after his leave credits were consumed, private
respondents placed petitioner on a floating status. It bears stressing that after more than one
(1) month from his exoneration and the lifting of the suspension, private respondents have
not assigned petitioner a new account. Finally, respondents required petitioner to undergo
a profile interview supposedly to determine which account would he would best fit in. In this
connection, while it was stressed that such profile interview was not a pre-qualification
requirement for employment, petitioner nonetheless received a text message from his
manager, respondent Michael Sy, informing him that he should pass the interview in order
to be endorsed to a new account .
Page 54 of 141
Case Digests
The conclusion is all too clear that Telus fostered a working environment that was
hostile, discriminatory, unreasonable, and inequitable that naturally compelled De Guzman
to give up his employment thereat to avoid the difficulties he had to face just to keep his
employment. The actions of Telus show that De Guzman was actually subsequently penalized
with a much graver consequence than the supposed preventive suspension that he had
undergone.
It should be noted that a mere desire to reinstate an employee to his/her former

position does not satisfy the requirement of the law. Such cannot amount to substantial
compliance on the part of the employer nor will it effectively negate the idea that the
employee was not being dismissed after the period of preventive suspension. To allow
"desire to reinstate," especially when there is no bar at all to actual reinstatement, as
substantial compliance to the need to revert the employee to his/her former post without
diminution in rank or in pay would defeat the very essence of the constitutional guarantee
of security of tenure. Employees who had undergone preventive suspension and were found
innocent of the offense charged would be at the mercy of the employer to be brought back to
his/her former working post and status when in the first place, he/she had a vested right to
the position from which he/she was ousted.
Contrary to the stance of Telus, the floating status principle does not find application
in the instant case. While it may be argued that the nature of the call center business is such
that it is subject to seasonal peaks and troughs because of client pullouts, changes in clients'
requirements and demands, and a myriad other factors, still, the necessity to transfer De
Guzman to another practice/account does not depend on Telus' third party-client/contracts.
When the controversy arose, Telus had several clients in its roster to which it can easily
assign De Guzman as Quality Analyst without any hindrance. As earlier admitted by Telus,
profiling interviews were not a condition precedent to the transfer. Moreover, as established
before the Labor Arbiter, after the lifting of the preventive suspension of De Guzman by
Telus, the company had several job vacancy postings for the position of Quality Analysts, the
very position previously occupied by De Guzman.
Moreover, this Court has held that placing employees in a valid "floating status"
presupposes that there are more employees than work. In the instant case, Telus did not
provide any valid justification or presented proof that there was indeed a deficit of account
that bars the immediate transfer of De Guzman or that the company was sustaining losses
that would justify placing De Guzman on floating status. Hence, the unwarranted acts of Telus
evidently constitute proof of the constructive dismissal of De Guzman.
Page 55 of 141
Case Digests
TELETECH CUSTOMER CARE MANAGEMENT PHILIPPINES, INC v. MARUI GERONA, JR.

G.R. No. 219166, November 10, 2021, Second Division (Hernando, J.)
DOCTRINE
To successfully invoke a valid dismissal due to redundancy, there must be: (1) a written
notice served on both the employees and the DOLE at least one month prior to the intended date
of termination of employment; (2) payment of separation pay equivalent to at least one month
pay for every year of service; (3) good faith in abolishing the redundant positions; and (4) fair
and reasonable criteria in ascertaining what positions are to be declared redundant and
accordingly abolished. Moreover, the company must provide substantial proof that the services
of the employees are in excess of what is required of the company.
FACTS
Respondent Mario Gerona was hired by business process outsourcing corporation

Teletech as technical support representative and was assigned to the Accenture account.
On October 30, 2009, Teletech's human resource office informed Gerona that he
would be transferred to the Telstra account upon successfully passing the training,
assessment and examination. Teletech gave him a copy of the Transfer Agreement and
informed him that his refusal to take the examinations would result in the termination of his
services on the ground of redundancy.
Gerona refused to undergo training and take the examinations under the belief that
he was entitled to security of tenure.
Gerona received a notice dated November 16, 2009 informing him of his dismissal
due to redundancy effective.
Through his counsel, he sent a demand letter to Teletech asserting that there was no
redundancy in the company considering that they were even continuously hiring other
technical support representatives. Moreover, as a regular employee, he should no longer be
required to take another examination to prove his qualifications.
Gerona filed a complaint for illegal dismissal.
Teletech argued that transferring the employees to the Telstra account was without
any demotion in rank or diminution in pay as long as they successfully passed the standard
product training and assessment.
Page 56 of 141
Case Digests
According to Teletech, undergoing training and assessment were necessary due to

the differences between the two accounts since Telstra catered to Australian customers
while Accenture had American customers. Since Gerona refused to transfer and go through
the training and examination, Teletech was forced to dismiss him on the ground of
redundancy.
The Labor Arbiter and NLRC dismissed the complaint. Reversing the LA and NLRC
ruling, CA held that Teletech failed to show that Gerona's position was redundant, not just
with respect to the Accenture account, but in relation to the whole business organization of
Teletech.
ISSUE
Whether Gerona was validly dismissed on the ground of redundancy.
RULING
NO. The Supreme Court held that the evidence presented by Teletech was insufficient
to support its claim.
Redundancy exists when an employee's services are in excess of what is reasonably

demanded by the actual requirements of the business.
To successfully invoke a valid dismissal due to redundancy, there must be: (1) a
written notice served on both the employees and the DOLE at least one month prior to the
intended date of termination of employment; (2) payment of separation pay equivalent to at
least one month pay for every year of service; (3) good faith in abolishing the redundant
positions; and (4) fair and reasonable criteria in ascertaining what positions are to be
declared redundant and accordingly abolished. Moreover, the company must provide
substantial proof that the services of the employees are in excess of what is required of the
company.
Teletech fails to convincingly show the alleged decline in Accenture's business and
that the expected volume of calls for its Accenture account would not materialize. In other
words, redundancy was not proven. Other than the bare assertion of human capital delivery
site manager Joel Go, no other evidence was offered to prove the alleged low volume of calls
or how the officers of Accenture and Teletech came to a conclusion that its business w2s
slowing down.
Teletech should have presented any document proving the decline in Accenture's
volume of calls for the past months, or affidavits of the Accenture and Teletech officers who
Page 57 of 141
Case Digests
determined that business was slowing down and their basis thereof. Unfortunately Teletech
only relied heavily on the self-serving affidavit of its human capital delivery site manager.
Having been illegally dismissed, Gerona is entitled to reinstatement and payment of

full backwages. However, due to the strained relations between Teletech and Gerona, the
Supreme Court finds it proper to award separation pay in lieu of reinstatement.
Page 58 of 141
Case Digests
RENATO C. TACIS, et. al. vs. SHIELDS SECURITY SERVICES, INC., et. al.
G.R. No. 234575, July 7, 2021, THIRD DIVISION (Hernando, J.)
DOCTRINE
“Before the employee 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, 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.”
FACTS
Tacis and Lamis alleged that they were hired as security guards assigned at Texas
Instruments. Sometime in November 2013, the Company deployed more or less 15 new
security guards at Texas Instruments and instructed petitioners to train the new recruits for
three days. However, Morante informed petitioners that the old security guards of Texas,
including herein petitioners, were relieved and terminated from service and that the 15 new
hires will replace them per the client’s request.
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, the General Manager, made a
commitment to transfer them to Soliman Security, a sister company of Shields Security.
Convinced that they would be absorbed by Soliman Security, petitioners submitted their
respective resignation letters and quitclaims. However, upon inquiry of Tacis as to the status
of their transfer, Morante informed him that there was no vacancy at Soliman Security.
ISSUE
Whether the petitioners were constructively dismissed.
RULING
NO. Petitioners’ resignation was voluntary.; there was no constructive dismissal.

Constructive dismissal is an involuntary resignation resorted to when continued
employment is rendered impossible, unreasonable, or unlikely; or when there is a demotion
in rank and/or a diminution in pay. In contrast, resignation is the formal pronouncement or
relinquishment of a position or office. It is a 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.
Page 59 of 141
Case Digests
First, petitioners relinquished their positions when they submitted their individual
letters of resignation. There was no indication that they were unduly influenced or coerced
to resign. Second, the petitioners accepted the retirement pay and monetary benefits and
executed a quitclaim. Third, the petitioners’ imputation of bad faith or deceit is untenable
since they failed to substantiate the same. Finally, it would stand to reason that if
respondents indeed promised petitioners that they will be absorbed by Soliman Security,
there would have been no need for petitioners to file a resignation letter.
Page 60 of 141
Case Digests
SYSTEMS AND PLAN INTEGRATOR AND DEVELOPMENT CORPORATION, et. al. vs.
MICHELLE ELVI BALLESTEROS.
G.R. No. 217119, April 25, 2022, SECOND DIVISION (Hernando, J.)
DOCTRINE
“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. Furthermore, 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.”
FACTS
Ballesteros worked as an administrative staff for SPID Corp. During the first week of
February 2011, Castro, the Personnel Officer of SPID, talked to Ballesteros and told her that
the President and Chief Executive Officer was asking for her resignation because she was
pregnant. In March 2011, Ballesteros gave birth and availed of the maternity leave. In April
2011, she went back to the office and told Castro that she did not want to resign. Castro
offered her two options: first, she resigns or second, the company terminates her
employment.
In May 2011, while still on maternity leave, Ballesteros discovered that her salary for
the first half of May was not deposited to her account even though her leave was until June
21, 2011. Alarmed, she contacted Castro and found out that the company withheld her salary
and that it would be released only if she would process her SSS Maternity benefits and tender
her resignation. Still, she refused to resign. On June 5, 2011, the company informed her of
her termination from the service. On the other hand, the company alleged that Ballesteros’
employment was terminated based on her incompetence and inefficiency in the performance
of duties, open and willful disobedience, and loss of trust and confidence.
ISSUE
Whether Ballesteros was validly terminated from employment.
RULING
NO. 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. Here, the company
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) loss of trust and
confidence.
Page 61 of 141
Case Digests
As to the first ground, the company failed to present substantial evidence to prove
that Ballesteros was indeed habitually absent. All the leaves she incurred were deducted
from her earned leave credits, which she was entitled to over the course of her work. Only
habitual absenteeism without leave constitutes gross negligence. Secondly, such leaves were
so few to be characterized as a reckless disregard for the safety of the company.
As to the second ground, the company also failed to present substantial evidence that
would show that the company gave clear verbal instructions regarding the preparation of
deposit slips. For willful disobedience to be a valid cause, these two elements must concur:
(1) the employee’s assailed conduct must have been willful or intentional; 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.
As to the last ground, loss of trust and confidence may be a just cause for termination
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 because she held a position of trust and confidence.
However, the second element was never established in the proceedings before the NLRC and
the CA.
Page 62 of 141
Case Digests
SRL INTERNATIONAL MANPOWER AGENCY, et. al. vs. PEDRO YARZA, JR.
G.R. No. 207828, February 14, 2022, SECOND DIVISION (Hernando, J.)
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 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
Pedro Yarza was hired as a Project Manager for a duration of two years by SRL and
Akkila, SRL’s foreign principal. Yarza departed for the United Arab Emirates on October 14,
2010. On March 24, 2011, 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, petitioners terminated his employment without prior notice and
due process. To his surprise, he received a termination letter from Akkila. Yarza claims that
he enjoys security of tenure since he was contracted to serve for 24 months and was hired
based on his credentials.
On the other hand, SRL confirmed that Akilla and Al Salmeen Trading are its foreign
principals. SRL forwarded Yarza’s documents to Akkila for processing of his employment
visa. However, unknown to SRL, Akkila and Yarza directly contacted each other regarding
Yarza’s deployment. To SRL’s surprise, Akkila sent a visit visa for Yarza instead of an
employment visa. SRL protested since it would violate the rules of the Philippine Overseas
Employment Agency (POEA). Nonetheless, SRL turned over to Yarza all of his documents
including the visit visa. From then on, SRL did not facilitate Yarza’s deployment as Yarza
handled it on his own. Moreover, Seamed, SRL’s accredited clinic, declared Yarza unfit for
work. Subsequently, in a letter dated May 22, 2014, Akkila informed Yarza that he cannot be
hired due to medical reasons.
ISSUE
Whether Yarza was illegally dismissed.
RULING
YES. Notwithstanding the invalidity of the contract of employment since it was not
approved by POEA, an employer-employee relationship may still exist by applying the four-
fold test. Since an employer-employee relationship exists in this case, the petitioners should
Page 63 of 141
Case Digests
accord Yarza due process, both substantial and procedural, before terminating his
employment. To comply with substantive due process, Yarza can only be dismissed for a just
or authorized cause, the absence of which renders his dismissal illegal.
Akkila dismissed Yarza on the ground of disease under Article 299 of the Labor Code.
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. Absent this certification, Akkila failed to comply with Article 299. In other
words, Yarza’s dismissal was not based on a just cause.
With regards to SRL’s liability, even if Yarza’s employment contract was not
previously approved by POEA, he should still be protected by our labor laws precisely
because an employer-employee relationship was established. SRL participated in Yarza’s
initial deployment despite its insistence that it ceased to process his documents after
discovering that a visit visa was secured instead of a work visa. SRL cannot evade liability by
simply refusing to process an overseas worker’s documentation yet at the same time admit
to being the local manning agent of a foreign principal which invalidly dismissed an
employee.
Page 64 of 141
Case Digests
SPOUSES FLORENTINO MAYNES, SR., and SHIRLEY MAYNES, Substituting SHEILA

MONTE, vs. MARIVIN OREIRO
G.R. No. 206109, November 25, 2020, THIRD DIVISION (Hernando, J.)
DOCTRINE
“Article 297(c) of the Labor Code 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.
The requisites 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, such loss of trust relates to the employee’s performance of duties.”
FACTS
Monte was a Salesclerk at respondent Oreiro’s Botique and Merchandise outlet in

Bangar, La Union. She claimed that she was summarily dismissed from employment without
just cause and due process. 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 declared that Monte was illegally dismissed and did not
abandon her work. In her memorandum before the NLRC, Oreiro provided more details
regarding Monte’s infractions. Nonetheless, the NLRC denied her appeal on the ground that
Oreiro is not allowed to change her theory on appeal. However, 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 termination was raised as an issue before the ELA.
ISSUE
Whether Monte was illegally dismissed.
RULING
NO. First, Oreiro did not change her theory on appeal. In her position paper, she
already put forth the argument that breach of trust is a ground for dismissal. Morte’s
dismissal was for a just cause. Article 297(c) of the Labor Code 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. The requisites 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, such loss of trust relates to the employee’s
performance of duties.
Page 65 of 141
Case Digests
Monte’s position is clearly imbued with trust and confidence. She was tasked to
perform overall supervision and control of the outlet including the receiving of different
items from the main office in Bacnotan. Oreiro submitted a Stocks Lost List which indicated
that certain stocks were lost while Monte was the Salesclerk managing the branch. She also
presented a list of old accounts in which lost payments cannot be located or explained by
Monte. Monte did not even offer any justification for the uncovered anomalies. These
infractions caused Oreiro to lose trust and confidence in Monte.
Page 66 of 141
Case Digests
RONNIE L. SINGSON vs. ARKTIS MARITIME CORP./FILPRIDE SHIPPING CO.,

INC./PROSPER MARINE PRIVATE LTD.
G.R. No. 214542, January 13, 2021, Third Division, (Hernando, J.)
DOCTRINE
The mere lapse of the 120-day period under Article 198 (c) (1) of the Labor Code does
not automatically give rise to a cause of action for a claim of permanent total disability benefits.
As provided for by Article 198 (formerly Article 192) of the Labor Code, as amended,
temporary total disability lasting continuously for more than one hundred twenty days, shall
be deemed total and permanent, except as otherwise provided for in the Rules.
FACTS
Ronnie was a “third engineer officer" on board the vessel "M/T Atlanta 2" for a period
of 10 months. Ronnie boarded the vessel on January 20, 2010 and commenced his
employment.
On October 13, 2010, petitioner complained of severe stomach pains and was
confined at the Citymed Hospital in Singapore. A day after, Dr. Noel Yao, petitioner's
attending physician, declared him to be fit to rejoin the vessel with rest on board for three
more days. When his condition did not improve, petitioner was recommended for
repatriation.
He arrived in Manila on October 17, 2010. The following day, he was referred for a
medical check-up at the company's accredited clinic where the company physician,
diagnosed him as suffering from "cholecystlithiasis and r/o pancreatic pseudo cyst," with a
recommendation for surgery.
About four months later, or exactly 134 days from petitioner's arrival in Manila, he
again underwent an examination. This time, he was declared by the company physician, as
"fit to work”.
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 attorney's fees alleging that he contracted the illness during the term of his
employment contract, he maintained that his illness was work-related.
ISSUE
Whether Singson is entitled to the award of total and permanent disability benefits.
Page 67 of 141
Case Digests
RULING
NO. The Court emphasized that the mere lapse of the 120-day period under Article
198 (c) (1) of the Labor Code does not automatically give rise to a cause of action for a claim
of permanent total disability benefits.
As provided for by Article 198 (formerly Article 192) of the Labor Code, as amended,
temporary total disability lasting continuously for more than one hundred twenty days, shall
be deemed total and permanent, except as otherwise provided for in the Rules. Such rule
refers to Rule X, Section 2 of the Rules and Regulations implementing Book IV of the Labor
Code which states the exception, viz: “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.“
As these provisions operate, 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 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 of course also be
declared fit to work at any time such declaration is justified by his medical condition.
In line with this, the Court emphasized that a recommendation to undergo surgery
does not necessarily prove that petitioner was not fit to work. Rather, such recommendation
merely proves that further medical treatment is needed.
Thus, since the records show that there was no declaration as to petitioner's fitness
to work or as to the permanent and total status of his disability within the 120-day period
but his sickness required medical treatment beyond the 120-day period, the temporary total
disability period was extended up to a maximum of 240 days, subject to the right of his
employer to declare within this period that a permanent partial or total disability already
Page 68 of 141
Case Digests
exists. In this connection, petitioner never presented any declaration to the effect that his
disability is total and permanent.
On the contrary, the evidence on record would reveal that petitioner was declared as
asymptomatic and fit to work on February 28, 2011 or one hundred thirty-four (134) days
after the onset of the disability, well within the 240-day period. Therefore, petitioner cannot
claim permanent total disability benefits and is only entitled to temporary total disability
benefits until the time when he was declared to be fit to work.
Page 69 of 141
Case Digests
EFREN SANTOS, JR. and JERAMIL SALMASAN,

vs. KING CHEF/MARITES ANG/JOEY DELOS SANTOS
G.R. No. 211073, November 25, 2020, Third Division, (Hernando, J.)
DOCTRINE
For the claim that an employee went AWOL, 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
Petitioners Santos and Salmasan were employed by Respondent King Chef. On

December 25, 2011, Santos rendered only a half day work without prior authorization.
Salmasan, on the other hand, did not report at all. Petitioners 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.
Respondents however averred that petitioners violated the 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. Respondents
believed petitioners went on AWOL after they got wind of respondents' decision to impose
disciplinary action against them for their unauthorized absence on December 25, 2011.
The Labor Arbiter found illegal dismissal but the NLRC held that since petitioners
were unable to prove that they were indeed terminated, the complaint for illegal dismissal
cannot be sustained pursuant to the principle that if there is no dismissal, there can be no
question as to the legality or illegality thereof. The CA affirmed the ruling of the NLRC but
removed the award for separation pay.
ISSUES
1. Whether or not petitioners were illegally dismissed.

2. Whether the petitioners abandoned their employment
RULING
1. NO. 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
Page 70 of 141
Case Digests
thereafter. Thus, Respondents had no time yet to discipline Complainants, before the latter
filed this case.
2. NO. 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." In the present case, was no showing here that
petitioners' absences were due to unjustifiable reason, or that petitioners clearly intended
to terminate their employment.
Page 71 of 141
Case Digests
SAN MIGUEL CORPORATION v. ROSARIO A. GOMEZ

G.R. No. 200815, August 24, 2020, Second Division, (Hernando, J.)
DOCTRINE
The requisites for a valid 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."
FACTS:
SMC employed Gomez as a researcher in the Security Department and concurrently

as Executive Secretary to the Head of the Security Department.
C2K is a corporation engaged in courier and delivery services. For the first three
months, 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 (Tamayo), formed another courier services group, Starnec, which
had been using fake C2K receipts and collecting the fees pertaining to C2K. C2K claimed that
it was through Gomez's intervention that Tamayo's group was able to transact business with
SMC.
When such matter was brought to the attention of SMC, they conduced an audit
where it was discovered that Gomez was allegedly involved in anomalies which caused
tremendous losses to SMC. Thus, Gomez was found guilty of committing fraud against SMC
and of receiving bribes through commissions in connection with the performance of her
function and was terminated from her employment.
The Labor Arbiter held that Gomez's employment was validly terminated. Such was
reversed by the NLRC and the NLRC’s ruling was affirmed by the CA.
ISSUE
Whether Gomez's termination from service was valid, legal and effective.
RULING
YES. The Court first noted that 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."
Page 72 of 141
Case Digests
As to the first requisite, the Court ruled that the nature of Gomez’ work falls under the
second class of positions of trust and confidence. 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.
The Court also held that the second requisite was present as Gomez willfully,
intentionally, knowingly, purposely, and without justifiable excuse disregarded SMC's rules
and regulations in the workplace.
The Court found 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. Gomez, as the coordinator in SMC's Mailing Department,
should have known or noticed said fake receipts since she had previously transacted with
C2K.
Thus, the Court found that Gomez was validly terminated on the ground of loss of
trust and confidence.
Page 73 of 141
Case Digests
DOLORES GALLEVO RODRIGUEZ, substituting her late husband EDGAR A.

RODRIGUEZ, vs. PHILIPPINE TRANSMARINE CARRIERS, INC., NORWEGIAN CREW
MANAGEMENT A/S, AND MR. CARLOS SALINAS
G.R. No. 218311, October 11, 2021, Second Division, (Hernando, J.)
DOCTRINE
Temporary total disability only becomes permanent when so declared by the company-
designated physician within the periods he/she is allowed to do so, or upon the expiration of
the maximum 240-day medical treatment period without a declaration of either fitness to work
or the existence of a permanent disability.
FACTS
Rodriguez was repatriated on October 2, 2012. Two days thereafter or on October 4,

2012 he reported to Dr. Lim and his medical team. On January 24, 2013, Dr. Lim issued an
interim disability assessment of Grades 12 and 8 on Rodriguez. On April 26, 2013, Dr. Lim
issued a final Medical Report indicating that Rodriguez was suffering from a final disability
assessment Grade 8.
From October 4, 2012 to January 24, 2013 when the interim disability assessment
was issued, more or less 112 days had lapsed. On the other hand, from October 4, 2012 to
April 26, 2013, when the final disability assessment was issued about 202 days had lapsed.
On April 30, 2013, Rodriguez consulted his personal orthopedic surgeon, Dr. Cesar H.
Garcia (Dr. Garcia) who found him to be afflicted with multiple disc protusion. In his April
30, 2013 Medical Certificate, he 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 respondents permanent total
disability benefits.
However, respondents insisted that as per Dr. Lim's findings, Rodriguez was only
suffering from a Grade 8 disability and thus he was only entitled to a partial and permanent
disability benefits.
Thus, on February 25, 2013, 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,
damages, and attorney’s fees. The NLRC modified such by deleting the award of moral
Page 74 of 141
Case Digests
damages, but affirming the award of total and permanent disability benefits and attorney's
fees.
The Court of Appeals held that Dr. Lim properly assessed Rodriguez with Grade 8
disability.
ISSUE
Whether Rodriguez is entitled to permanent and total disability compensation.
RULING
NO. In answering this issue, the Court found that there existed sufficient justification
for Dr. Lim to extend Rodriguez'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.
Thus, Dr. Lim's April 26, 2013 final medical assessment was justifiably issued beyond
the 120-day period but within 240 days from the time Rodriguez first reported to him. With
this, the Court found Rodriguez not entitled to his claim for permanent and total disability
benefits.
Moreover, since Dr. Lim and Dr. Garcia had conflicting medical assessments,
Rodriguez failed to refer the matter to a third doctor, jointly agreed upon the parties, as
mandated by Section 20 (A) of the 2010 POEA- SEC and the parties' Collective Bargaining
Agreement (CBA). It must be noted that in case of conflicting medical assessments between
a company- designated physician and the seafarer's private physician, then referral to a third
doctor is mandatory. In the absence of a third doctor's opinion, it is the medical assessment
of the company-designated physician that should prevail.
Page 75 of 141
Case Digests
ARIEL M. REYES v. RURAL BANK OF SAN RAFAEL (BULACAN), INC., FLORANTE

VENERACION, CELERINA SABARIAGA, ALICIA FLOR KABILING, FIDELA MANAGO,
CEFERINO DE GUZMAN, and RIZALINO QUINTOS
G.R. No. 230597, March 23, 2022, Second Division (Hernando, J.)
DOCTRINE
A review of the findings below will reveal that Reyes refused to certify said report based
on his honest assessment that the report cannot be completely validated for lack of material
data and evidence. Be that as it may, imposing the ultimate penalty of dismissal for such action
— which, as already mentioned, obtains justification — and for such single instance, is simply
too harsh and downright unlawful.
FACTS
Rural Bank of San Rafael (Bulacan), Inc. (RBSR) is a domestic banking corporation. In
2012, several stockholders of RBSR complained about the discrepancies in the amounts of
the purchase price of stock subscriptions appearing in the original receipts as against the
duplicate copies issued by the bank.
In compliance with the Manual of Regulations for Banks mandating the prompt report
of anomalies to the Bangko Sentral ng Pilipinas (BSP), RBSR's Board of Directors approved a
Report on Crimes and Losses and directed Reyes - as Compliance Officer - to certify the same.
However, Reyes refused to certify the report, reasoning that no independent investigation
was conducted.
Thereafter, Reyes claimed that instead of furnishing him the hard copies of the
reports and its original attachments to enable him to verify and certify the same, RBSR issued
him two show cause orders and put him on preventive suspension for neglect of duty.
Reyes, together with Bognot and Eusebio (complainants) - who were principally
accused of theft/misappropriation of funds in connection with the anomaly - filed a
Complaint against respondents for illegal suspension and money claims. An Amended
Complaint was subsequently filed to include illegal dismissal, in view of their eventual
dismissal from work.
The Labor Arbiter found RBSR guilty of illegally dismissing Reyes, Bognot, and
Eusebio. The National Labor Relations Commission (NLRC) reversed the arbiter’s ruling. The
Court of Appeals affirmed the NLRC ruling.
ISSUE
Page 76 of 141
Case Digests
Whether Reyes was illegally dismissed.
RULING
YES. While it is true that Reyes was given sufficient opportunity to explain his side
during the investigation, the Court cannot help but notice the muddled and vague charges
against him. Specifically, it cannot be determined with reasonable certainty on what grounds
the charges pressed against Reyes were based on, and which ones were proven.
While it would appear that Reyes was initially charged with insubordination or
neglect of duty, the show cause order surprisingly accused him of participation in the alleged
theft/misappropriation, and neither is there any showing that the same has been established
nor is it specifically mentioned as the reason for his dismissal. Instead, the termination letter
sent to Reyes, which is a mirror copy of the ones sent to Bognot and Eusebio, merely
employed general and loose statements. Neither is there any mention of which specific rule
or policy Reyes allegedly violated.
Surely, this is not the kind of notice contemplated by the Labor Code and its
implementing rules. In view of all the foregoing, the Court finds that respondents failed to
comply with the due process requirements in dismissing Reyes. In the present case, there is
no question that Reyes' refusal to certify the Report on Crimes and Losses was intentional.
This is clearly disobedience. However, we find that the same is not attended by a wrongful
and perverse mental attitude which warrants the ultimate penalty of dismissal.
A review of the findings below will reveal that Reyes refused to certify said report
based on his honest assessment that the report cannot be completely validated for lack of
material data and evidence. Be that as it may, imposing the ultimate penalty of dismissal for
such action — which, as already mentioned, obtains justification — and for such single
instance, is simply too harsh and downright unlawful.
Page 77 of 141
Case Digests
JR HAULING SERVICES and OSCAR MAPUE v. GAVINO L. SOLAMO, RAMIL JERUSALEM,

ARMANDO PARUNGAO, RAFAEL CAPAROS, JR., NORIEL SOLAMO, ALFREDO
SALANGSANG, MARK PARUNGAO and DEAN V. CALVO
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."
FACTS
JR Hauling is a domestic corporation engaged in the business of hauling and delivery

of broiler chickens to its clients. Respondents are former drivers/helpers of JR Hauling.
Since a number of broilers usually die in the course of their delivery, respondents
secure from the farms additional broilers to serve as replacements for the dead broilers in
order to ensure that the same quantity under the job order will be delivered to the
processing plant.
Respondents were required to make two trips per day and were thus paid P300 per
trip or a total of P600 per day. Respondents averred that considering that the broiler farms
are located in remote and distant areas, they could only accomplish one trip per day, and
would thus earn only P300 per day. Respondents further alleged that from the time they
were engaged by JR Hauling, they were not paid their respective 13th month pay, holiday
pay, premium pay for holiday and rest day, and SIL.
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.
Upon further investigation, petitioners discovered that respondents, without the

knowledge or consent of JR Hauling, were committing anomalous transactions involving the
sale of excess broilers and crates somewhere in Concepcion, Tarlac. In support thereof,
petitioners presented affidavits.
The Labor Arbiter found that the complainants were illegally dismissed. The National
Labor Relations Commission (NLRC) reversed the decision of the LA and held that the
Page 78 of 141
Case Digests
respondent’s dismissal from employment was valid on the ground of loss of trust and
confidence. The CA set aside the resolution of the NLRC.
ISSUE
Whether there is substantial evidence to prove that respondents were validly

dismissed from employment.
RULING
YES. 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."
The Supreme Court ruled 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 Court agrees that 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.
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. 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 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." In this regard, it is not the job title but the nature of the work that the employee
is duty-bound to perform which is material in determining whether he holds a position
where greater trust is placed by the employer and from whom greater fidelity to duty is
concomitantly expected.
Page 79 of 141
Case Digests
Petitioners, as drivers/helpers, were entrusted with the custody, delivery and

transportation of the broilers and broiler crates, including their proper handling and
protection, in accordance with the directives of JR Hauling and instructions of its clients.
Page 80 of 141
Case Digests
EDUARDO G. JOVERO v. ROGELIO CERIO, JESUS ALBURO, JR., GIL CLAVECILLAS,

DOMINGO ZEPEDA, RAUL CLERIGO, DOMINGO CANTES, MARCELINO COPINO, CEAZAR
CAÑEZO, LEVY LEGAZPI, EUSTAQUIO RANGASA, ELMAR CONVENCIDO, and ACHILES
DYCOCO
G.R. No. 202466, June 23, 2021, Third Division (Hernando, J.)
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 were hired on various dates by Sigma Construction and Supply (Sigma),
an independent contractor owned by Eduardo G. Jovero.
As cement cutters, they were assigned to work at the drilling site of Philippine
Geothermal, Inc. However, PGI preterminated one of its contracts with Sigma on April 1,
1993, which was initially supposed to end 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.
The respondents filed a complaint for illegal dismissal, underpayment of wages, and
non-payment of labor standard benefits against Sigma and PGI.
The respondents 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, respondents 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 (LA) held that respondents were regular employees. As such, they
were entitled to separation pay instead of reinstatement, as well as back wages. The National
Labor Relations Commission (NLRC) decided that the decision of the LA shall be vacated and
set aside. The Court of Appeals reversed the decision of the NLRC.
Page 81 of 141
Case Digests
ISSUE
Whether respondents were regular employees and illegally dismissed by the

petitioner.
RULING
YES. 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.
Clearly, 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 respondents were informed at the time of their
hiring, that they were project employees. Moreover, petitioner's failure to file termination
reports at the end of each project was an indication that respondents were regular
employees.
Petitioner failed to prove through substantial evidence that respondents are project
employees. It is evident that respondents were illegally dismissed due to petitioner's failure
to comply with the substantive and procedural due process tenets under the Labor Code.
Page 82 of 141
Case Digests
ITALKARAT 18, INC. VS. JURALDINE N. GERASMIO

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 N. Gerasmio filed a complaint for illegal dismissal,

reinstatement, backwages, separation pay, declaration of the quitclaim and release as null
and void, 13th month pay, litigation expenses, damages, and attorney’s fees against
petitioner Italkarat 18.
He alleged that he was hired by petitioner in 1990, and was designated as the
Maintenance Head and Tool and Die Maker until he was dismissed on the ground of serious
business losses. He claimed that petitioner repeatedly informed its employees of its
proposed retrenchment program because it was suffering from serious business losses. He
further claimed that the Company informed him of its plan to retrench a substantial number
of workers, and that he was given the option to retire early, in which case he will be given a
sum of P170,000. He was also cautioned that he might not receive anything if he did not retire
early.
With this, Juraldine executed a resignation letter and quitclaim. He then returned to
get his check worth P170,000, but to his dismay, he was informed that he would be receiving
only P 26,901.34. Thus, he sent the Company a letter demanding the promised amount of
P170,000 through his lawyer. The Company did not respond, so Juraldine filed the instant
complaint.
The Company alleged that Juraldine resigned from his job, and even took leaves of
absences in order to process his papers for a possible seaman’s job. It further stated that he
executed and signed a waiver and quitclaim showing the computation of his receivables. He
signed for the voucher and received the check issued to him as his last pay. The Company
refused to pay him the additional amount he demanded for lack of basis in law and in fact.
The Labor Arbiter found that Juraldine was unlawfully dismissed. It ruled that the
complainant was forced to resign because of a misrepresentation that he would receive
P170,000 as separation pay. The NLRC set aside the decision, but the CA reversed such.
Page 83 of 141
Case Digests
ISSUE
Whether the complaint for illegal dismissal should prosper.
RULING
YES. Juraldine failed to prove the fact of his dismissal, especially considering the
existence of a signed resignation letter from him. In Machica v. Roosevelt Services Center, Inc.,
the Court held that the rule that the employer bears the burden of proof in illegal dismissal
cases finds no application here because the respondents deny having dismissed the
petitioners. In the same case, it has also been clarified that there can be no question as to the
legality or illegality of a dismissal if the employee has not discharged his burden to prove the
fact of dismissal by substantial evidence.
Here, Juraldine has the burden of proving that he was dismissed by the Company
before his dismissal can be raised as an issue. However, a perusal of the evidence on record
shows that he failed to prove the fact of dismissal. He primarily relied on his uncorroborated
and self-serving allegations that he was misled by the Company into resigning. Considering
that a resignation letter and a quitclaim bearing Juraldine’s signature exists, the evidence
falls short of that required under the law to discharge his burden to prove that he was
dismissed by the Company.
In this light, petitioner is not entitled to a separation pay as demanded. 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. But in the case at hand, Juraldine failed to show that he
perfected a contract with the Company regarding his separation pay, and that there exists a
Company practice wherein resignees were given separation pay.
In conclusion, considering that there was no dismissal involved in this case as

Juraldine voluntarily resigned from work, his 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.
Page 84 of 141
Case Digests
FERNANDO C. GOSOSO VS. LEYTE LUMBER YARD AND HARDWARE, INC., AND RUBEN
L. YU
G.R. No. 205257, January 13, 2021, Third Division (Hernando, J.)
DOCTRINE
Mere acts of hostility, however grave, committed by the employer towards the employee
cannot on their lonesome be construed as an overt directive of dismissal from work. Assuming
that petitioner was truly dismissed from employment, he still failed to demonstrate that
respondents did it constructively.
FACTS
Respondent Leyte Lumber hired Gososo as a sales representative. Yu was the

construction company’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. The management also required its employees 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.
It was alleged that Gososo was required to produce a letter of apology for two
incidents showing that he overstepped the boundaries of Leyte Lumber’s company policies.
Admitting fault, he submitted the letter to Yu, reasoning that he was doing his job for the
company's clients and that such was not his intention. This letter of apology was refused by
Yu. After returning to work, Gososo was told to sign a prepared document. He declined since
the document contained admissions of offenses that he did not commit. Irked by Gososo 's
refusal, Yu flared up with his usual hot temper and told [the former] that he is terminated
from work on that very day. Thus, Gososo filed a complaint for illegal constructive dismissal
plus claims against respondents.
Respondent posited that Gososo was seen leaving his designated work area, to which
he admitted. He was also issued a Memorandum reminding him of the violations he
committed and a warning that further violations will merit dismissal from work.
Respondents also claim that Gososo filed a leave of absence on the day itself of his absence
purportedly to attend his son’s graduation. However, this was done in disregard of the rule
that leaves of absence must be filed and approved days before the actual date of leave.
The Labor Arbiter opined that Gososo had no intention to keep his position,
dismissing Gososo’s complaint. Such decision was reversed by the NLRC, finding him to be
illegally dismissed by respondents. The CA overturned the ruling of the labor tribunal and
reinstated the decision of the Labor Arbiter dismissing the labor complaint. It held that
Page 85 of 141
Case Digests
Gososo's claim of illegal dismissal was supported only by his bare and self-serving
allegations.
ISSUE
Whether Gososo was legally dismissed by respondents Leyte Lumber and Yu.
RULING
YES. 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. However, in this case, petitioner never proved that he was dismissed in the first
place. He simply alleged that upon his refusal to sign a document prepared by respondent
Yu, the latter "flared up with his usual hot temper and told [the former] that he is terminated
from work on that very day," which barely measured up to the minimum evidential
requirement from petitioner.
Mere acts of hostility, however grave, committed by the employer towards the
employee cannot on their lonesome be construed as an overt directive of dismissal from
work. Assuming that petitioner was truly dismissed from employment, he still failed to
demonstrate that respondents did it constructively.
As enunciated in the case of Doctor v. Nii Enterprises, constructive dismissal has often
been defined as a "dismissal in disguise" or "an act amounting to dismissal but made to
appear as if it were not." It exists where there is cessation of work because continued
employment is rendered impossible, unreasonable or unlikely, as an offer involving a
demotion in rank and a diminution in pay. In some cases, it may still exist when continued
employment has become so unbearable because of acts of clear discrimination, insensibility
or disdain by the employer, that the employee has no choice but to resign.
Here, petitioner insists that he was forced to sign a prepared incriminatory letter and
then fired when he refused to do so. This statement does not fit the legal definition stated by
jurisprudence. Even if these accusations were adequately corroborated, while respondent
Yu's rebuke of petitioner is overbearing and intimidating, it was reasonably incited by the
latter's violations of respondent Leyte Lumber's company practices. It cannot be considered
as tantamount to unequivocal acts of discrimination, insensibility, or disdain as to render
petitioner's continued employment as unbearable. In fine, the Court finds no working basis
to declare that petitioner had been dismissed, whether legally, illegally, or constructively.
Page 86 of 141
Case Digests
MARIA LEA JANE I. GESOLGON AND MARIE STEPHANIE N. SANTOS VS. CYBERONE PH.,
INC., MACIEJ MIKRUT AND BENJAMIN JUSON
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.
FACTS
Petitioners Gesolgon and Santos alleged that they were hired by Mikrut as part-time
home-based remote Customer Service Representatives of an Australian company, CyberOne
Pty. Ltd. Thereafter, they became permanent employees, and were eventually promoted as
Supervisors. Then, they were asked together with Juson to become dummy directors of
CyberOne PH to which petitioners agreed to. As a result, petitioners were promoted as
Managers and were given increases in their salaries.
However, in the November payroll, Mikrut reduced petitioners' salaries. Aside from
the decrease in their salaries, petitioners were only given P20,000.00 each as 13th month
pay for 2010. Petitioners were also made to choose 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 an entry level position as home-based Customer Service
Representative; or (c) to tender their irrevocable resignation. Petitioners alleged that they
were constrained to pick the first option in order to save their jobs. They then received
P13,000 as their last salary. Hence, petitioners filed a case against respondents for illegal
dismissal and payment of damages.
The Labor Arbiter held that petitioners were not employees of CyberOne PH as they
did not exercise control over them. The NLRC ruled otherwise, noting that petitioners were
paid their monthly salary and allowance, and that they were illegally dismissed from service,
as shown by the Furlough Notifications issued to petitioners, which were in fact, notices of
dismissal.
The CA then ruled that there was no employer-employee relationship between

petitioners and CyberOne PH, but only with petitioners and CyberOne AU, stressing that the
Furlough Notifications were issued by CyberOne AU and not by the former. This means that
CyberOne PH did not have the power of termination over the petitioners.
ISSUE
Page 87 of 141
Case Digests
Whether an employer-employee relationship exists between petitioners and

CyberOne PH.
RULING
NO. Records reveal that Gesolgon and Santos were hired as home-based Customer
Service Representatives of CyberOne AU, a corporation organized and existing under the
laws of Australia. However, petitioners were notified by CyberOne AU of their dismissal
through Furlough Notifications, placing their employment on hold in view of the company's
cost-cutting measure.
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, petitioners 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, petitioners contend that they were hired as employees of CyberOne PH
as shown by the pay slips. Other than this, no other evidence was submitted to prove their
employment by CyberOne PH. Petitioners 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 petitioners 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 petitioners is not supported by evidence on record. To reiterate,
petitioners failed to prove the manner by which CyberOne PH alledgedly supervised and
controlled their work. In fact, petitioners 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. Since petitioners are not employees of CyberOne PH, therefore there is no
need to delve into their illegal dismissal.
Page 88 of 141
Case Digests
ESICO V. ALPHALAND CORP.

G.R. No. 216716. November 17, 2021, Second Division, (Hernando, J.)
DOCTRINE
The rule in illegal dismissal cases that while the employer bears the burden of proving
that the termination was for a valid or authorized cause, the employee must first establish by
substantial evidence the fact of his dismissal from service.
FACTS
The labor dispute between Esico and respondents Alphaland originated from the
former employment relationship with PhilWeb Corporation (Phil Web), a part of
respondents of companies.
Esico is a well-decorated officer, former pilot Philippine Airforce who retired with the
rank of lieutenant colonel. He is licensed to fly both fixed wing and rotary wing civilian
aircrafts and had just topped the Certified Security Professional Examinations at the time of
his employment within respondents' group of companies. Given his impressive credentials,
Phil Web initially hired Esico as Risk & Security Management Officer (RSMO).
By April 19, 2010, respondents 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.
On even date, Esico sent an e-mail to Alphaland’s then Head of Security and Aviation,
Mike Asperin, expressing elation at working for respondents' group of companies and
specifically asking for the latter's recommendation on what salary figure to quote
respondents for his engagement as Pilot.
In May 2011, along with four (4) other pilots of respondents Alphaland, Esico
underwent flight training in the United States of America to operate the brand-new Cessna
Grand Caravan 208B purchased by respondents Alphaland for the resort development of its
affiliate and subsidiary, Alphaland Balesin Island Resort. The costs of the Cessna flight
training amounted to P657,019.00 broken down as follows: (a) course fees of US$11,300.00;
(b) airfare of P120,937.00; (c) terminal fee of P750.00; (d) per diem of US$801.00; (d)
clothing allowance of US$200.00; and (e) accommodations of 25,562.00.
On December 23, 2011, Esico found out that he had been transferred from Phil web
to Alphaland because he could not access his payroll with Phil web. This was confirmed by
Philweb's Human Resource Administrator. The latter told Esico that he had been transferred
to Alphaland effective December 1, 2011.
Page 89 of 141
Case Digests
On March 3, 2012, Esico was handed a letter from respondents. The said letter,
among others provides that Alphaland agrees to advance the necessary expenses to send him
for the ground and flight training course, and such, Esico further agreed render service to
the Company for a minimum period of five years beginning on the start date indicated above.
And that should he fail to complete the minimum years of service, Esico is subjected to
reimburse the Respondent for the expenses spent on his training.
On July 3, 2012, Esico tendered his letter of resignation addressed to

[respondents Alphaland’s] HR Manager. In his resignation Letter, he stated 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 matter.
On July 16. 2012, Esico received a demand letter from Alphaland's legal officer.
Among other things, the letter demanded that Esico reimburse the amount of P977,720.00
representing the portion of his flight training expenses.
Esico filed a complaint for illegal dismissal before the Regional Arbitration Branch of
the NLRC. He also sent a reply letter addressed to respondents' counsel refuting the
allegations therein. On August 2, 2012, Alphaland filed a complaint against Esico for alleged
wrongful resignation and damages with the NLRC.
The Labor Arbiter ruled in favor of Alphaland in and all the acts enumerated by Esico
which led him to resign did not amount to constructive dismissal, NLRC declared that Esico
was illegally constructively dismissed from his employment. The CA annulled the NLRC
decision.
ISSUES
1. Does the Labor Arbiter or NLRC have jurisdiction over the case?
2. Whether Esico was constructively dismissed
RULING
1. No. The LA and the NLRC do not have jurisdiction over the said case.
In this case, 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 (advances) for flight trainings. Unarguably, respondents
Page 90 of 141
Case Digests
Alphaland claim payment of actual damages equivalent to the amount they advanced for
Esico's flight training who reneged on his contractual obligation by his premature
resignation. Respondents 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.
Respondents Alphaland's claim against Esico, albeit arising out of their employer-
employee relationships, is not cognizable by the LA and the NLRC. Moreover, in determining
which tribunal has jurisdiction over a case, we consider not only the status or relationship
of the parties, but more so the nature of the question that is the subject of controversy.
Alpha land seek to enforce their rights under the employment contract consider ring
Esico's failure to comply with his contractual obligation when he resigned from respondent
corporations. The 2010 letter engaging Esico as pilot states that in the event of his
resignation before completion of the required minimum service, Esico is obliged to
reimburse the costs of his flight trainings pro-rated to the number of years already served.
Failure to comply with either of the alternative obligations resulted in respondents
Alphaland 's cause of action against Esico, which suit is cognizable by the regular courts of
law. Labor tribunals do not have jurisdiction to settle various issues necessitating
application of our civil law on obligations and contracts.
Overall, jurisdiction being set by law and not by the parties, the LA and the NLRC
cannot exercise jurisdiction over respondents Alphaland' 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.
2. No. Esico failed to establish his constructive dismissal by substantial evidence.
From his resignation letter and the evidence threshed out before the labor tribunals
and the CA, we are hard pressed to make a finding that Esico' s resignation was involuntary
brought about by unbearable, unreasonable, and discriminatory acts of respondents
Alphaland. Apart from the employment contract which is the pith of the issue between the
parties, Esico did not muster the standard of substantial evidence to prove that respondents
Alphaland intended his dismissal. What is fairly apparent is that Esico resigned because he
was dissatisfied and unhappy with respondents Alphaland for the cited reasons in his
resignation letter.
Considering that Esico was not constructively dismissed, he is not entitled to

backwages, and separation pay in lieu of reinstatement. The Court, however, ruled that Esico
is entitled to his other money claims of unpaid salaries for his concurrent designation as
Page 91 of 141
Case Digests
RMSO and pilot of respondents' group of companies pursuant to the contentious

employment contracts.
The arrangement set up by respondents Alphaland, reflected in the ambiguous

employment contracts, worked for Esico's disadvantage who was given the run around by
respondents each time he attempted to ascertain the true nature of the terms and conditions
of his employment. Thus, considering the totality of the circumstances, to prevent injustice,
as well as the evasion of an existing obligation, we recompute Esico's unpaid salaries under
the various contracts he signed with respondents' group of companies.
Page 92 of 141
Case Digests
ENGINEERING & CONSTRUCTION CORPORATION OF ASIA v. PALLE

G.R. No. 201247, July 13, 2020, Second Division, (Hernando, J.)
DOCTRINE
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."
FACTS
Petitioner ECCA, now known as First Balfour Incorporated, is a domestic corporation

engaged in the construction business. Respondents Palle, Velosa, Pampanga, Galabo, Galapin
and Felicitas (collectively, respondents) were hired by ECCA on various dates to work in its
construction business.
The instant case stemmed from the illegal dismissal complaint filed in 2004 by the
respondents with the National Labor Relations Commission (NLRC) against ECCA and its
president, Oscar Lopez.
ECCA claimed that respondents, as project employees, were validly terminated in

view of the project's completion. It pointed out that respondents 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. On the
other hand, Respondents mainly argued 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.
The Labor Arbiter held that respondents were regular employees of ECCA. The Labor
Arbiter pointed out that the company has not presented any document showing that in every
termination of the project, respondents' employment was also terminated. Furthermore, the
Labor Arbiter also noted that respondents were hired by ECCA for one project but were later
repeatedly rehired for more than 20 to 30 years in several other projects. Thus, this showed
that respondents have become regular employees of ECCA. The Labor Arbiter emphasized
that where the employment of project employees is extended long after the first project had
been finished, the employees are removed from the scope of project employment and are
considered regular employees.
Aggrieved, ECCA filed an appeal with the NLRC. In its decision, the NLRC reversed the
findings of the Labor Arbiter and granted ECCA's appeal.
Page 93 of 141
Case Digests
ISSUE
Whether or not respondents were illegally dismissed as regular employees or validly

terminated in view of the completion of their contract as project employees.
RULING
YES. Respondents were regular employees who were illegally terminated. The
Supreme Court uphold the findings of the CA that respondents were regular employees who
were illegally terminated.
Regular and Project Employees, distinguished.
Article 295 [280] of the Labor Code provides the following 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.
On the other hand, DOLE's Department Order No. 19, series of 1993 (D.O. No. 19),
otherwise known as the Guidelines Governing the Employment of Workers in the
Construction Industry, provides:
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.
Page 94 of 141
Case Digests
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 co-terminous with the project and may be terminated upon the end or
completion of the project or a phase thereof for which they were hired.
The Court found that ECCA failed to present substantial evidence to show that it
informed respondents of the duration and scope of their work at the time of their hiring.
Upon careful review of the company's respective contracts of employment with respondents,
this Court holds that the employment contracts were lacking in detail to prove that
respondents 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
respondents may have been dated at the time of their issuance, but nowhere did said
contracts show as to when respondents supposedly signed or received the same or were
informed of the contents thereof. This gives rise to the distinct possibility that respondents
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. Thus, ECCA failed
to refute respondents' claim that they worked in new projects, or they were transferred to
other existing projects without the benefit of their corresponding employment contracts.
Therefore, ECCA failed to persuasively show that respondents herein were informed at the
time of their engagement that their work was only for the duration of the project.
Moreover, ECCA failed to present other evidence or other written contracts to show
that it informed respondents of the duration and scope of their work. 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."
In addition, the Court also noted that the company did not submit a report with the
DOLE of the termination of respondents' employment every time a project is completed,
which is an indication that the workers were not project employees but regular ones.
In view of ECCA's indisputable failure to discharge its burden to prove that

respondents were project employees, the Court finds that the CA properly found them to be
regular employees. Therefore, respondents, as regular employees, may only be dismissed for
just or authorized causes and upon compliance with procedural due process, i.e., notice and
hearing. This Court notes that completion of a project is not a valid cause to terminate regular
employees, such as respondents herein.
Page 95 of 141
Case Digests
FLORENCIO B. DESTRIZA VS. FAIR SHIPPING CORPORATION

G.R. No. 203539. February 10, 2021, Third Division, (Hernando, J.)
DOCTRINE
Certainly, disability compensation cannot rest on mere allegations couched in

conjectures and baseless inferences from which work-aggravation or relatedness cannot 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.
FACTS
Destriza 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 the respondents FSC,
Cachapero and Boseline.
FSC is a domestic corporation duly organized and existing under Philippine laws.
Baseline is a foreign juridical entity engaged in the business of shipping. FSC is Baseline's
local manning agent in the Philippines while Cachapero is the President of FSC.
Destriza is a seafarer formerly employed by FSC for its foreign principal Baseline. He
was first deployed by FSC in 2001 as a cook aboard M/V Pacific Venus. He was again
deployed in 2002 in the same capacity aboard M/V Tocho-Maru.
On or about December 10, 2003, while on board M/V Cygnus, Destriza experienced
abdominal pain, fever, and yellowish discoloration of the skin and eyes. He was rushed to a
hospital in Nagoya, Japan where he was diagnosed with biliary duct stone, jaundice, and
suspected pancreatitis. After his discharge from the hospital, he was medically repatriated
to his home country for further treatment.
Upon arrival in the Philippines, Destriza was immediately referred to FSC's company
physician, Dr. Nicomedes Cruz. He underwent cholecystectomy and intraoperative
cholangiogram in Medical Center Manila. He was diagnosed with "Chronic Calculus
Cholecystitis." In a Report, Dr. Cruz stated that Destriza was "evaluated by their
gastroenterologist who allowed him to resume his previous activities," and declared him fit
to return to work. The treatment was shouldered by FSC.
However, Destriza insisted that he remained unfit as he continued to experience
recurring and severe abdominal pains. This prompted him to undergo a medical check-up
with Dr. Donato-Tan, a cardiologist, on October 14, 2004. He was subsequently admitted to
Page 96 of 141
Case Digests
a hospital on December 10 to 16, 2004. After his discharge, Dr. Donato-Tan concluded that
he was "unfit to resume work as a seaman in any capacity."
In a Resolution, 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.
In its Decision, the CA modified the PVA's Resolution by deleting the award of
US$20,000.00 for lack of legal basis.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. The CA also
gave greater weight on Dr. Cruz's finding that Destriza is fit to return to work, thereby
negating Destriza's claim for disability benefits.
ISSUE
Whether Destriza is entitled to disability benefits as previously awarded by the PVA.
RULING
No. The Court affirms the assailed Decision of the CA finding Destriza not entitled to
the award of US$20,000.00.
The standard employment contract for seafarers was formulated by the POEA
pursuant to its mandate under Executive Order No. 247, series of 1987 to "secure the best
terms and conditions of employment of Filipino contract workers and ensure compliance
therewith" and to "promote and protect the well-being of Filipino workers overseas."
The POEA Standard Employment Contract governs Destriza's claim for disability
benefits. Since his contract was signed on February 10, 2003 and approved by the POEA on
February 12, 2003, POEA Memorandum Circular No. 9, series of 2000 applies in this case and
is deemed integrated in Destriza's contract.
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 to disability or death as a
result of an occupational disease listed under Section 32-A of this Contract with the
conditions set therein satisfied."
Page 97 of 141
Case Digests
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."
Similarly, 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." There
is still a need for the claimant to establish, through substantial evidence, that his illness is
work related.
Thus, if an illness is not included in the list under Section 32-A of Memorandum
Circular No. 9, it is disputably presumed as work-related. Despite the disputable
presumption, case law such as Madridejos provides that to be compensable, the seafarer still
has the burden to establish, by substantial evidence, that his illness is work-related. As
stated, the disputable presumption does not amount to an automatic grant of compensation.
In the instant case, it is undisputed that Destriza was suffering from Chronic Calculus
Cholecystitis due to development of gallstones. Since Chronic Calculus Cholecystitis and even
contracting of gallstones are not included in Section 32-A of Memorandum Circular No. 9,
Destriza had the burden of establishing, by substantial evidence, that his illness was work-
related or was at least aggravated by work. In short, he had the burden of showing that he
contracted gallstones because of his work as cook in M/V Cygnus.
The Court agrees with the CA that 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.
In addition, Destriza's failure to resort to a third-doctor opinion proved fatal to his

cause. It is settled that in case of disagreements between the findings of the company-
designated physician and the seafarer's doctor of choice, resort to a third-doctor opinion is
mandatory. The third-doctor opinion is final and binding between the parties. The opinion
of the company-designated physician prevails over that of the seafarer's personal doctor in
Page 98 of 141
Case Digests
case there is no third-doctor opinion. Thus, Dr. Cruz's declaration that Destriza is fit to
resume sea duties prevails over the medical opinion issued by Dr. Donato-Tan.
Finally, it does not escape the Court that FSC conditionally paid Destriza the peso
equivalent of the award in the amount of P902,440.00. In view of this, Destriza shall return
the amount paid to him by FSC.
Page 99 of 141
Case Digests
JOSE R. DELA TORRE v. TWINSTAR PROFESSIONAL PROTECTIVE SERVICES, INC.

G.R. No. 222992, June 23, 2021, Third Division (Hernando, J.)
DOCTRINE
While an employee may accept his dismissal and agree to waive his claims or right to
initiate or continue any action against his employer, both parties do not have the jurisdiction
or authority to determine whether such termination is legal or not; such question of law is still
subject to the final determination of the competent labor tribunals and courts, as the case may
be. It follows then that the award of nominal damages, which by its nature, arises from the
determination of whether the employee’s rights were violated or not in an illegal dismissal case,
cannot be deemed to be covered by the quitclaim. Here, Dela Torre executed a quitclaim in favor
of Twinstar. Later, he filed a complaint for illegal dismissal against the company, but on appeal,
the NLRC dismissed the same and did not direct Twinstar to pay Dela Torre nominal damages
because of the quitclaim. The Supreme Court found that there was no constructive dismissal in
the case but held that Twinstar failed to follow statutory due process as it did not give Dela
Torre ample chance to explain and be heard on the allegations against him, which is the
purpose of the first notice in the “two-notice rule.” Twinstar merely terminated the employment
of Dela Torre. Hence, the award of nominal damages in Dela Torre’s favor is warranted.
FACTS
Jose Dela Torre (Dela Torre) was employed as a security guard by Twinstar
Professional Protective Services, Inc. (Twinstar). Later, he alleged that he was on floating
status for more than six months, which prompted him to file a complaint for illegal dismissal
against Twinstar. The Labor Arbiter (LA) held that Dela Torre was constructively dismissed.
On appeal before the National Labor Relations Commission (NLRC), Twinstar averred
that it had sent several notices to Dela Torre for him to report for duty. A Twinstar duty
officer also sent text messages and tried to call Dela Torre but to no avail. Dela Torre allegedly
refused to receive a company letter and manifested his unwillingness to go on duty anymore
to an officer who was tasked to deliver such letter. Subsequently, Twinstar found Dela Torre
guilty of insubordination or willful disobedience for his refusal to report to work and accept
reassignment despite receipt of the notices. Twinstar likewise alleged that Dela Torre had
already filed an earlier labor complaint with the Department of Labor and Employment-
National Capital Region and executed a Deed of Quitclaim and Release.
The NLRC reversed the decision of the LA and did not award nominal damages in
favor of Dela Torre because of the existing quitclaim. Dela Torre filed a petition for certiorari
with the Court of Appeals (CA), but the court denied the same for lack of merit. The CA also
held that the quitclaim was valid, justifying the non-award of nominal damages.
Page 100 of 141

Case Digests
ISSUES
(1) Was Dela Torre constructively dismissed by Twinstar?

(2) Is Dela Torre entitled to nominal damages?
RULING
(1) NO. In Philippine Span Asia Carriers Corporation v. Pelayo, the Court has held that
the standard for constructive dismissal is “whether a reasonable person in the employee’s
position would have felt compelled to give up his employment under the circumstances.”
However, “not every inconvenience, disruption, difficulty, or disadvantage that an

employee must endure sustains a finding of constructive dismissal.” What is vital is the
weighing of the evidence presented and a consideration of whether, given the totality of
circumstances, the employer acted fairly in exercising a prerogative. Here, Dela Torre utterly
failed to prove that he was constructively dismissed. He never presented any evidence, aside
from his self-serving allegations, that he was forced to be on floating status for more than six
months without being given new assignment by Twinstar.
In comparison, Twinstar was able to establish that Dela Torre went on absence
without leave and that it had subsequently sent several notices to him. Aside from the said
notices, a duty officer of Twinstar vainly tried to contact Dela Torre by calling him and
sending text messages, and a field inspector of Twinstar attempted to deliver a company but
Dela Torre refused to receive the same.
(2) YES. 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.” Here, Twinstar found Dela Torre
guilty of insubordination or willful disobedience, which is a just cause under Article 297 of
the Labor Code, for his refusal to report to work and accept reassignment despite receipt of
the notices to return to work. However, there is nothing in the records that would show that
Twinstar gave Dela Torre ample chance to explain and be heard on the allegations against
him, which is the purpose of the first notice in the “two-notice rule.” Twinstar merely
terminated the employment of Dela Torre without complying with the rules laid down in
King of Kings Transport v. Mamac.
While the existing quitclaim is valid, the stipulations therein must still be interpreted
within the bounds of law and reason. Given the foregoing, Dela Torre’s statement in the
quitclaim that he has “no more claim, right or action of whatsoever nature whether past,
present or contingent against the said respondent and/or its officers” cannot be deemed to
include the illegal dismissal case. This is because the legality of an employee’s dismissal is
Page 101 of 141

Case Digests
determined by law and it is the LA that has the original and exclusive jurisdiction to
determine such a case.
While an employee may accept his dismissal and agree to waive his claims or right to
initiate or continue any action against his employer, both parties do not have the jurisdiction
or authority to determine whether such termination is legal or not; such question of law is
still subject to the final determination of the competent labor tribunals and courts, as the
case may be. It follows then that the award of nominal damages, which by its nature, arises
from the determination of whether the employee’s rights were violated or not in an illegal
dismissal case cannot be deemed to be covered by the quitclaim.
Nominal damages are “adjudicated in order that a right of the plaintiff, which has been
violated or invaded by the defendant, may be vindicated or recognized, and not for the
purpose of indemnifying the plaintiff for any loss suffered by him.” If the Court were to allow
the quitclaim to cover nominal damages, this will promote, either advertently or
inadvertently, the practice of “dismiss now, pay later,” which obviously runs afoul to the
public policy behind the imposition of such nominal damages in the first place. Therefore,
regardless of the quitclaim, Dela Torre is entitled to the award of nominal damages.
Page 102 of 141

Case Digests
PACIFIC ROYAL BASIC FOODS, INC. v. VIOLETA NOCHE, et al.

DOCTRINE
Section 6, Rule VI of the 2011 NLRC Rules provides that an appeal may be perfected by
the appellant-employer only by the posting of a bond in the equivalent amount of the full
monetary award granted to the appellee-employee. The perfection of an appeal in the manner
and within the period set by law is not only mandatory but jurisdictional. Consequently, there
should be no implied approval of a jurisdictional requirement that has not been complied with.
Otherwise, the ground of lack of jurisdiction becomes a waivable defect in procedure. Whether
the NLRC accepts or rejects the appellant’s motion to reduce bond, the ruling must be
unequivocal, and such ruling must be issued before or at the time the NLRC resolves the appeal
by final judgment. Failure to do so shall render the NLRC liable for grave abuse of discretion for
having ruled on an appeal without acquiring jurisdiction over the same, and the judgment it
had issued shall be vacated as null and void. In the present case, PRBFI filed a motion to reduce
bond before the NLRC, but the latter never acted on it. Instead, the NLRC resolved the case on
all its substantial points. Such cannot be deemed as an implied affirmation of the perfection of
PRBFI’s appeal. Therefore, the NLRC did not acquire jurisdiction over the appeal and the
judgment it issued is null and void.
FACTS
Violeta Noche, Juliana Abrigunda, Crisanta Talavera, Ma. Asuncion Arguelles, Ciriaca
Velasco, Severa Quitain, Rosalinda Balahadia, Anicia Dagle, Norma Plata, Zenaida Bulahan,
and Susana Amparo (Noche, et al.), all employed as coconut parers by Pacific Royal Basic
Foods, Inc. (PRBFI), filed a complaint for non-regularization against the company.
Later, PRBFI, allegedly acting on product quality complaints from some of its clients,
asked Noche, et al. to explain why they should not be penalized for a suspected
contamination in some of the company’s products. The proceedings led to Noche, et al. being
dismissed from employment due to lack of trust and confidence.
Noche, et al. filed a complaint for illegal dismissal against PRBFI. They averred, among
others, that there is lack of basis of their dismissal due to loss of trust and confidence as this
ground refers to managerial and confidential employees and they were only rank-and-file
workers of PRBFI.
The Labor Arbiter (LA) ruled in favor of Noche, et al. PRBFI appealed to the National
Labor Relations Commission (NLRC). The company filed a motion to reduce bond and
tendered a cash bond in the amount of P100,000. Noche, et al. assailed PRBFI’s appeal for
Page 103 of 141

Case Digests
failure to post the required bond. Moreover, records show that PRBFI’s motion to reduce
bond was subsequently never acted upon by the NLRC.
The NLRC reversed the decision of the LA. The Court of Appeals (CA) reversed the
resolution of the NLRC and affirmed the decision of the LA. The CA 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. Furthermore, PRBFI cannot rely on the
presumption of regularity in the performance of official duties.
ISSUE
Would an implied approval of a motion to reduce bond, i.e., the NLRC’s disposal of the
appeal by final decision, suffice as a grant of the appellant-employer’s motion to reduce
bond?
RULING
NO. Mcburnie v. Ganzon requires the concurrence of the following conditions before
an aggrieved employer appealing before the NLRC may be allowed to post a bond in a
reduced amount:
(1) The employer-appellant files a motion to reduce bond;

(2) The motion to reduce bond shall be based on meritorious grounds;
(3) The employer-appellant posts the provisional percentage of at least 10%
of the monetary award, excluding therefrom the award of damages and attorney’s
fees;
(4) The provisional bond must be posted within the reglementary period for
appeal; and
(5) If the NLRC eventually determines that a greater or the full amount of the
bond shall be posted, the employer-appellant shall comply accordingly within ten
(10) days from notice of the NLRC order directing such posting of the increased or
full amount of the bond.
Once these are complied with, the aggrieved employer’s appeal of the LA’s decision
before the NLRC shall be deemed perfected. Notably, the requisites laid out by Mcburnie also
presupposes a sixth requirement: the NLRC issues an express ruling on the appellant’s
motion to reduce bond. Records, however, show that PRBFI’s motion to reduce bond was
never acted upon by the NLRC. Still, the NLRC resolved PRBFI’s appeal of the LA’s decision
on the merits and issued its own resolutions thereon.
Page 104 of 141

Case Digests
Section 6, Rule VI of the 2011 NLRC Rules provides that an appeal may be perfected
by the appellant-employer only by the posting of a bond in the equivalent amount of the full
monetary award granted to the appellee-employee. The perfection of an appeal in the
manner and within the period set by law is not only mandatory but jurisdictional.
Consequently, there should be no implied approval of a jurisdictional requirement that has
not been complied with. Otherwise, the ground of lack of jurisdiction becomes a waivable
defect in procedure. Whether the NLRC accepts or rejects the appellant’s motion to reduce
bond, the ruling must be unequivocal, and such ruling must be issued before or at the time
the NLRC resolves the appeal by final judgment. Failure to do so shall render the NLRC liable
for grave abuse of discretion for having ruled on an appeal without acquiring jurisdiction
over the same, and the judgment it had issued shall be vacated as null and void.
There is grave abuse of discretion against the NLRC. PRBFI cannot rely on the mere
presumption of regularity in the performance of official duties in favor of the NLRC when the
latter gave due course to its appeal; not when it is faced with a serious imputation of non-
compliance from Noche, et al. Considering that the requirements provided under the Labor
Code and its Implementing Rules are mandatory for purposes of perfecting an appeal, the
rule on presumption of regularity cannot apply. Worse, the NLRC did not resolve the issue.
At any rate, a further review on the merits only aggravates the defeat of PRBFI’s cause
against Noche, et al. Loss of trust and confidence as a ground to dismiss an employee is
inapplicable to Noche, et al. Following Wesleyan University Philippines v. Reyes, two requisites
must concur for a valid termination of employment due to loss of trust and confidence:
[T]he 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.
Noche, et al.’s 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. Noche, et al. having occupied ordinary
rank-and-file posts with PRBFI, their dismissal on the ground of loss of trust and confidence
is illegal.
Page 105 of 141

Case Digests
JOSE DEL PILAR, et al. v. BATANGAS II ELECTRIC COOPERATIVE, INC. (BATELEC II)
G.R. No. 160090, February 19, 2020, Second Division (Hernando, J.)
BATANGAS II ELECTRIC COOPERATIVE, INC. (BATELEC II) v. JOSE DEL PILAR, et al.
DOCTRINE
The purpose of a written notice under Article 283 of the Labor Code is to give employees
time to prepare for the eventual loss of their jobs as well as to give the DOLE the opportunity to
ascertain the veracity of the alleged cause of termination. Here, a reorganization took place at
BATELEC II, resulting in the abolition of positions pertaining to Del Pilar, et al. As such,
BATELEC II refused to reinstate Del Pilar, et al., and the NLRC treated the said refusal as
retrenchment. At the time of the reorganization, Del Pilar, et al. were deemed employees of
BATELEC II because they were earlier reinstated to payroll. Despite this, Del Pilar, et al. were
not notified of their retrenchment; BATELEC II merely assumed that Del Pilar, et al. knew about
the retrenchment when they actively participated in the proceedings before the LA. Hence, Del
Pilar, et. al’s dismissal is valid, but BATELEC II must pay them indemnity for failing to observe
the requirements of due process.
FACTS
Jose Del Pilar, Emelba Baliwag, Renato Bauyon, Loida Dotong, Victoriana Eje, Nenita
Lasin, Padilla Regondola, Mauro Rodriguez, and Ma. Salome Santoyo (Del Pilar, et al.) were
unlawfully terminated by Batangas II Electric Cooperative, Inc. (BATELEC II) in 1992, which
led to the Labor Arbiter’s (LA) order for their reinstatement. Del Pilar, et al. were then
reinstated to payroll, and the employment relationship between them and BATELEC II
resumed.
In 1995, 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
a reorganization that abolished the positions pertaining to Del Pilar, et al. Instead, BATELEC
II offered to pay separation pay. Such move was opposed by Del Pilar, et al.
Eventually, the National Labor Relations Commission (NLRC) and the Court of
Appeals treated BATELEC II’s refusal to reinstate as retrenchment, a form of authorized
dismissal. In the succeeding proceedings, the NLRC also ordered BATELEC II to pay full
backwages to Del Pilar, et al.
Article 283 of the Labor Code requires the employer to serve a written notice on the
workers and the Department of Labor and Employment (DOLE) at least one month before
the intended date of retrenchment. BATELEC II claimed that it had fully complied with the
said notice rule. It asserted that Del Pilar, et al. were aware of their impending retrenchment
Page 106 of 141

Case Digests
when BATELEC II filed a manifestation with motion to that effect and Del Pilar, et al. were
accorded due process when they filed their opposition thereto. As such, Serrano v. National
Labor Relations Commission, which mandates the payment of fine and backwages for failure
of the employer to observe the procedure for termination of employment, does not apply to
BATELEC II.
ISSUE
Did BATELEC II comply with the notice rule under Art. 283 of the Labor Code?
RULING
NO. The purpose of a written notice under Article 283 of the Labor Code is to give
employees time to prepare for the eventual loss of their jobs as well as to give the DOLE the
opportunity to ascertain the veracity of the alleged cause of termination.
In the present case, there was no actual notice of termination. BATELEC II merely
assumed that Del Pilar, et al. knew about the retrenchment when they actively participated
in the proceedings before the LA who tackled the validity of the reorganization. The offer to
pay separation pay is not sufficient to replace the formal requirement of written notice. At
the time the reorganization took place, complainants were reinstated on payroll so they were
deemed employees of BATELEC II. Thus, there was no reason why BATELEC II could not have
served them notice of retrenchment before actually dismissing them.
Pursuant to Serrano, Del Pilar, et al. were entitled to separation pay and backwages.
However, in the subsequent cases of Agabon v. National Labor Relations Commission and Jaka
Food Processing Corporation v. Pacot, the Court now orders payment of nominal damages for
valid dismissals due to just or authorized cause but not compliant to statutory due process.
In De Jesus v. Aquino, the Court said:
Under Agabon, the new doctrine is that the failure of the employer to observe
the requirements of due process in favor of the dismissed employee (that is, the two
written notices rule) should not invalidate or render ineffectual the dismissal for just
or authorized cause … Even so, the Agabon Court still deplored the employer’s
violation of the employee’s right to statutory due process by directing the payment of
indemnity in the form of nominal damages, the amount of which would be addressed
to the sound discretion of the labor tribunal upon taking into account the relevant
circumstances.
Pursuant to Jaka, the Court directs BATELEC II to pay only indemnity in the amount
of P50,000.00 each to Del Pilar, et al.
Page 107 of 141

Case Digests
DEL MONTE LAND TRANSPORT BUS, CO. v. RENANTE A. ARMENTA ET AL.

G.R. No. 240144, February 3, 2021, (Hernando, J.)
DOCTRINE
“Jurisdiction over the subject matter or authority to try a certain case is conferred by
law and not by the whims, consent or acquiescence of the interested parties nor by the
erroneous belief of the court or tribunal that it exists. It should be exercised precisely by the
person in authority or body in whose hands it has been placed by the law; otherwise, acts of the
court or tribunal shall be void and with no legal consequence”
FACTS
To ensure the protection and welfare of drivers and conductors in the public utility
bus industry, the Department of Labor and Employment (DOLE), in the exercise of its rule-
making power, issued Department Order No. 118- 12 (DO 118-12) on January 13, 2012
providing for a fixed and performance compensation scheme in the computation of public
utility bus driver's or conductor's wage. The goal of the issuance was to insure public road
transport safety by improving the working conditions, compensation and competence of bus
drivers and conductors thereby eliminating their risk- taking behavior. On February 12,
2014, the DOLE, through its Regional Director, issued Labor Standards Compliance
Certificates (LSCC) as Bus Transportation to Del Monte Motor Works, Inc. (DMMWI) for
having complied with DO 118-12, other labor laws, rules and regulations. The certificates of
compliance were valid for one (1) year from issuance unless earlier revoked or cancelled.
DLTB is a domestic corporation established on March 16, 2010 with principal office address
at 650 EDSA, Malibay, Pasay City, Metro Manila. It is engaged in the transportation business
and duly registered to operate as a common carrier plying the route of Metro Manila to
Batangas, Laguna, Bicol, and Visayas and vice versa.
Respondents, on the other hand, are drivers and conductors who were hired by DLTB
on various dates from 2010-2013. They averred that since the start of their employment,
they have yet to receive their 13th month pay, holiday pay, five (5)-day service incentive
leave pay, rest day pay, overtime pay, and ECOLA. They further claimed that their daily
salaries were at P337.00, below the prevailing daily minimum wage of P466.00 at that time
in violation of paragraph (a), Section 2, Rule I of DO 118-12.
On July 28, 2014, a complaint for underpayment of wages, non- payment of holiday
pay, holiday premium, rest day premium, service incentive leave, 13th month pay, and
attorney's fees was filed by the respondents against Del Monte Land Transport Bus, Co., Inc.
(DLTB). DLTB claimed that respondents are not entitled to receive the statutory minimum
wage rates for the National Capital Region (NCR) because they are all assigned in various
Page 108 of 141

Case Digests
operations centers of DLTB located n the South Luzon and Visayas regions at the time of the
institution of the complaint. Moreover, the prevailing minimum wage in the NCR cannot be
invoked by respondents since DLTB's office in Manila is a mere transit point.
The LA held that respondents are entitled to their monetary claims. The LA held that
DLTB is domiciled in the NCR with its principal office address at 650 EDSA, Malibay, Pasay
City, NCR. However, NLRC found the LA to have committed grave abuse of discretion in
assuming jurisdiction over the case. The NLRC held that the LA disregarded the provisions
of DO 118-12 which categorically provided that compliance with minimum wages, wage-
related benefits, hours of work and occupational safety and health standards of public utility
bus drivers and conductors shall be enforced by the appropriate Regional Office of the DOLE
(DOLE-RO) having jurisdiction over the principal office of the owner/operator. The appellate
court, in a Decision dated December 21, 2017, reversed the ruling of the NLRC and held that
the LA correctly took cognizance of the present case. The CA noted that 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
Which between the Labor Arbiter and the DOLE has jurisdiction over the labor
standards claims of respondents public utility bus drivers and conductors.
RULING
DOLE pursuant to Article 128 and the provisions of DO 118-12 has the purview of the
jurisdiction. The CA therefore erred in affirming the LA's assumption of jurisdiction. 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. The findings of the DOLE, however, may still be questioned through
a petition for certiorari under Rule 65 of the Rules of Court.
Page 109 of 141

Case Digests
ARMANDO H. DE JESUS v. INTER-ORIENT MARITIME ENTERPRISES, INC., INTER-

ORIENT MARITIME ENT., INC.-LIBERIA, GRIGOROUSSA I MARINE S.A.- MONROVIA
LIBERIA
G.R. No. 203478, June 23, 2021, (Hernando, J.)
DOCTRINE
“For a disability to be compensable under Section 20 (B) of the 2000 POEA-SEC, it must
be the result of a work-related injury or a work-related or work-aggravated illness. The POEA-
SEC defines a work-related injury as "injuries resulting in disability or death arising out of and
in the course of employment."
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 prior to the present
controversy. For every employment contract he has entered with Inter-Orient, De Jesus
underwent the requisite pre-employment medical examination (PEME) and was
consistently declared "fit for sea service. On July 4, 2005, De Jesus executed another
employment contract with Inter-Orient, on behalf of its principal, Inter-Orient Maritime Ent.,
Inc.- Liberia, Grigoroussa I-Maritime S.A., as Second Mate on board M/T Grigoroussa I, for
nine months
On his seventh month on board the vessel and while it was docked in the
Mediterranean Sea off the coast of Egypt, De Jesus felt severe chest pains and had difficulty
breathing. The master of the vessel then instructed that De Jesus be brought to the nearest
hospital. On March 28, 2006 he was admitted at the Suez General Hospital in Egypt (United
Doctors Hospital) where he was diagnosed with Acute Extensive Myocardial Infarction. Dr.
Edward Youssef of United Doctors Hospital cleared De Jesus to travel by plane back to the
Philippines. However, he was declared unfit for physical work and was advised to
immediately undergo a coronary angiography.
Upon his arrival in the Philippines on April 12, 2006, De Jesus proceeded directly to
the office of the respondent company. He inquired about his unpaid salaries and 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.
It was confirmed that he had Myocardial Infarction and that he must undergo
rehabilitation and continuous medication. No medical report was given to him. He then
requested to have his treatment conducted in Cebu, his hometown, under the supervision of
Page 110 of 141

Case Digests
the company's accredited doctors. Inter-Orient agreed to the arrangement provided De Jesus
sign a letter stating that he will hold the company free and harmless from any liability.
All expenses for his treatment were for his own account since respondent company
informed him that he already received all that was due him. On February 12, 2007, De Jesus
filed before the NLRC Regional Arbitration Branch in Cebu a complaint docketed as NLRC
RAB VII OFW Case No. 02-0014-2007 for disability benefits and sickness allowance under
the POEA-Standard Employment Contract (POEA-SEC) and for moral and exemplary
damages.
The 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. In a Decision dated February 25, 2009, the Labor Arbiter found
in favor of De Jesus. The NLRC reversed and set aside the ruling of the Labor Arbiter and held
that De Jesus' illness was not work-related. It accorded great weight to the Medical Report
submitted by Inter-Orient. To which the CA dismissed De Jesus’ petition.
ISSUE
Whether or not the Court of Appeals erred when it dismissed outright petitioner's
Petition for Certiorari and denied petitioner's Motion for Reconsideration based purely on
procedural and technical grounds.
RULING
YES. Contrary to the findings of the appellate court, the petitioner attached a Certified
True Copy (original stamped) of the NLRC Decision and only the Resolution denying his
Motion for Reconsideration was a photocopy of the Certified True Copy of the issuance. The
photocopied Resolution nonetheless bears the notation "Certified True Copy" as that found
in the attached NLRC Decision. As to the alleged defect in the Affidavit of Service in the
Petition for Certiorari, although petitioner failed to attach the registry receipt as proof of
service to NLRC, he nonetheless indicated the registry receipt no. in the affidavit. Ultimately,
this Court finds it proper to decide the case based on the merits and brush aside the
technicalities considering the substantial compliance of the petitioner with the formal
requirements set out by the rules.
The employment of seafarers is governed by the terms and conditions of their

employment contract, the law and the relevant regulations of the POEA-SEC, which are
deemed integrated into every employment contract, which employers are bound to observe
as the minimum requirements for the employment of Filipino seafarers.
Page 111 of 141

Case Digests
For a disability to be compensable under Section 20 (B) of the 2000 POEA-SEC, it

must be the result of a work-related injury or a work-related or work-aggravated illness. The
POEA-SEC defines a work-related injury as "injuries resulting in disability or death arising
out of and in the course of employment." On the other hand, a work-related illness has been
defined 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."
This Court finds no merit in the supplication of the petitioner. He is not entitled to
disability benefits for his failure to validly and timely question the findings of the company-
designated physician declaring his disability not work-related or aggravated, and in view of
the valid quitclaim which he himself executed relinquishing all his rights against the
respondents. Hence, the Petition for Review on Certiorari is hereby partly granted.
Page 112 of 141

Case Digests
EFRAIM DAUT DARROCA, JR. v. CENTURY MARITIME AGENCIES, INC., and/or DAMINA
SHIPPING CORP., and/or JOHANNA B. DURANA
G.R. No. 234392, November 10, 2021, (Hernando, J)
DOCTRINE
“For disability to be compensable under the above POEA-SEC, 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
Beginning May 10, 1998, Darroca was continuously hired as a seafarer by respondent
Century Maritime Agencies, Inc. (Century) under various employment contracts. On August
12, 2012, Darroca was rehired by Century for and in behalf of its foreign principal, Damina
Shipping Corporation (Damina) for a period of seven months, with a monthly salary of
US$545.00. Prior to embarkation, Darroca underwent a rigid physical and medical
examination where he was declared fit for sea duty. On August 12, 2012, Darroca boarded
the vessel MT "Dynasty." However, after one month of working, Darroca started to
experience difficulty in sleeping and extreme exhaustion.
On October 15, 2012, while Darroca was in the port of Houston, USA, he consulted
with Dr. Darell Griffin. He was diagnosed with "major depression and psychomotor
retardation" and was declared unfit for sea duty. Subsequently, he was repatriated back to
the Philippines for further treatment. Upon arrival in the Philippines on October 15, 2012,
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 with in 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.
On July 23, 2014, due to his continued incapacity to work, Darroca consulted Dr. Nedy
Lorenzo Tayag (Dr. 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. On May 29, 2014, 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.
Page 113 of 141

Case Digests
The LA decided 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 in his associations within his work
environment onboard their vessel. Complainant's chosen physician also failed to identify and
prove with substantial evidence the risk factors or conditions which could have caused his
medical condition or otherwise prove the causal connection of his condition with his work
onboard the vessel. the NLRC affirmed the Decision of the LA and dismissed Darroca's
complaint for permanent total disability benefits and sickness allowance.
In affirming the NLRC, the CA gave credence to the company- designated physician's
finding that Darroca's illness was not work-related. It found no causal connection between
Darroca's disability and his work as a seafarer.
ISSUE
Whether Darroca's illness is work-related and therefore compensable.
RULING
NO. Work-relatedness, or the causal connection between the illness contracted and
the nature of work of a seafarer, is a factual question which is not a proper subject of this
Court's review. Nonetheless, the Court finds it necessary to elucidate certain principles
pertinent to a seafarer's claim for disability benefits.
The legal presumption of work-relatedness must still be read together with the
requirements of compensability under Section 32-A of the 2010 POEA-SEC, which provides:
For an occupational disease and the resulting disability or death to be compensable, all of
the following conditions must be satisfied: 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; 4. There was no notorious negligence on the part of
the seafarer.
Thus, for both listed occupational diseases under Section 32 and non- listed illnesses,
the seafarer must sufficiently show by substantial evidence compliance with the conditions
for compensability.
In the case at bar, Darroca failed to sufficiently 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. Upon consultation with his
physician of choice back in the Philippines, Darroca was also diagnosed to be suffering from
Page 114 of 141

Case Digests
major depression with psychotic features. 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. Notably, even
the medical evaluation by his own doctor did not mention anything about his duties as a
seafarer, or the risks involved thereto.
Work-related mental illnesses resulting from a traumatic head injury, even if not due
to physical damage, are compensable under the conditions set forth in law. In sum, the CA
correctly ruled that the NLRC did not gravely abuse its discretion in finding that Darroca's
illness is not work-related. In the absence of substantial evidence, working conditions cannot
be considered to have caused or at least increased the risk of contracting the mental illness
or in this case, major depression with psychotic features. After all, the onus probandi falls on
the seafarer to establish his claim for disability benefits and substantially prove that his work
conditions caused or at least increased the risk of contracting his illness.
Page 115 of 141

Case Digests
C.F. SHARP CREW MANAGEMENT, JAMES FISHER TANKSHIP LTD., AND/OR MR.
RAFAEL T. SANTIAGO v. JIMMY G. JAICTEN
G.R. No. 208981, February 01, 2021, Third Division, (Hernando, J)
DOCTRINE
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 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.
In several cases, we held that the doctor who have had a personal knowledge of the
actual medical condition, having closely, meticulously and regularly monitored and actually
treated the seafarer’s illness, is more qualified to assess the seafarer’s disability.
FACTS
Jimmy Jaicten (Jaicten) was employed on April 30, 2008 by C.F. Sharp, for and in
behalf of its foreign principal JFTL, as a Bosun on board M/V Cumbrian Fisher for 9 months.
He was declared fit to work during his pre-employment medical examination.
On October 05, 2008, he suffered chest pains which lasted for 2 days. He was
diagnosed with non-ST myocardial infarction in Belfast City Hospital, Ireland. He underwent
coronary arteriography and balloon dilation with stenting. After his discharge, he was
repatriated on October 30, 2008.
On January 07, 2009, the company-designated physician certified Jaicten as fit to

work. He sought a second medical opinion from his doctor Dr. Vicaldo 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 he is not entitled to permanent and total disability benefits.
They claimed that the company physician had already declared Jaicten to be fit to resume
sea duties. Jaicten himself even signed the Certificate of Fitness to Work and was line up for
reemployment. However, 8 months from being cleared to resume to work, he filed a claim
for disability benefits.
The Labor Arbiter (LA) dismissed Jaicten’s complaint and noted that Jaicten himself
agreed and confirmed his fitness to work when he signed the Certificate for Fitness to Work
Page 116 of 141

Case Digests
which barred him from claiming disability benefits. The LA further sustained petitioners’
claim that when Jaicten reapplied for employment and underwent another preemployment
medical examination, he was found to be fit for sea duties and for which reason he was
already lined up for deployment. The LA also held that petitioners are not obliged to rehire
Jaicten since his employment was contractual in nature.
The NLRC reversed the ruling of the LA and granted Jaicten’s claim for disability
benefits. It have credence to the second medical opinion that Jaicten is suffering from a
permanent disability due to his elevated blood pressure. Moreover, the signing of a pro-
forma Certificate of Fitness to Work did not negate his non-deployment by petitioners. It
declared that Jaicten’s lingering hypertensive cardiovascular disease and the fact that an
artificial device is attached to his coronary system entitled him to permanent and total
disability benefits in the amount of $60,000 and 10% thereof as attorney’s fees.
The CA affirmed the ruling of the NLRC granting permanent and total disability
benefits to Jaicten. It ruled that respondent’s medical condition bars him from returning to
his job as a seafarer.
ISSUE
Whether or not Jaicten is entitled to permanent total disability benefits and attorney’s
fees. (NO)
RULING:
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 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.
Respondent anchored his claim for total and permanent disability benefits on the
medical certificate issued by Dr. Vicaldo. However, a perusal of said medical certification
would show that it is not supported by any diagnostic test and/or procedure as to effectively
and adequately refute the assessments made, and tests administered, by the company-
designated physician, Dr. Ong-Salvador and her team. True, respondent was required to
continue his medications even after he was declared fit to work; however, this did not
discredit the findings of the company-designated physician that respondent is fit to resume
Page 117 of 141

Case Digests
sea duties. Said doctor monitored his medical condition and conducted several tests over a
period of more or less 3 months since he was repatriated.
In several cases, we held that the doctor who have had a personal knowledge of the
actual medical condition, having closely, meticulously and regularly monitored and actually
treated the seafarer’s illness, is more qualified to assess the seafarer’s disability. Hence, as
between the findings of the company physician 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.
Jaicten’s signing of the Certificate of Fitness to Work effectively released petitioners

from any liability arising from his repatriation due to medical reasons, absent any showing
that petitioners coerced him into signing the said certificate.
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. 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 petitioners.
Page 118 of 141

Case Digests
EVELINA E. BELARSO v. QUALITY HOUSE INC AND/OR CARMELITA GO

G.R. No. 209983, November 10, 2021, Second Division, (Hernando, J)
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. 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."
FACTS
On November 14, 1976, Quality House, a manufacturer and distributor of leather

products, hired petitioner Evelina E. Belarso. She was initially assigned at the belt
department of QHI. Sometime in 1986, she was transferred from the belt department to the
raw materials warehouse. She was then promoted as supervisor of the Raw Materials
Warehouse.
On December 2010, before leaving the warehouse, Belarso submitted herself to the
routinary outgoing inspection and body frisking of employees at the QHI gate. When her bag
was inspected, Lady Guard Salamanca found a belt buckle inside the bag. Belarso had no gate
pass or authorization to bring out the said item from the warehouse. She denied any
knowledge on why and how the belt buckle got inside her bag. Thereafter, an incident report
was immediately filed by LG Salamanca.
Belarso received a notice from QHI placing her under preventive suspension and
requiring her to submit a written explanation within 48 hours. She submitted her written
explanation denying all the accusations against her. She claimed that her bag was placed
outside her work station under a table located beside the door and near the window. The
bag was visible to everyone. She requested for a dialogue with QHI and explained that her
co-employees framed her up by putting the belt buckle inside her bag without her
knowledge.
Page 119 of 141

Case Digests
QHI issued a memorandum that it found Belarso’s explanation to be unsatisfactory

and that her employment was being terminated for stealing company property and for loss
of trust and confidence. However, before the result of the investigation was even released, a
complaint for illegal dismissal against QHI was already filed by Belarso.
The Labor Arbiter ruled that Belarso had been illegally dismissed by QHI. However,
the NLRC 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. The
CA sustained the NLRC’s findings and agreed that the evidence on record supports QHI’s
position.
ISSUE
Whether or not there exists a just cause to terminate the petitioner from her
employment. (YES)
RULING
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:
xxxx
(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
Page 120 of 141

Case Digests
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."
After a careful review of the records, the Court found the above conditions present.
First, Belarso never denied in her Petition that she held a position of trust and confidence. 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.
Page 121 of 141

Case Digests
SUSAN M. BANCE, ARLENE C. DIMAIWAT, JEAN O. VELASCO, NANCY M. AGUIRRE, AND

HAZEL A. LOBETANIA v. UNIVERSITY OF ST. ANTHONY AND SANTIAGO ORTEGA JR.
G.R. No. 202724, February 03, 2021, Third Division, (Hernando, J):
DOCTRINE
Management prerogative includes the right to discipline employees, which necessarily

includes dismissal of employees based on just and authorized causes. For a dismissal from
employment to be valid, both the substantial and procedural due process requirements must be
satisfactorily complied with. Substantial due process pertains to the "employee's right not to be
dismissed without just or authorized cause, as provided by law." Procedural due process
pertains to the employer's compliance with the procedure in effecting a dismissal as provided
in the Labor Code and implementing rules. The burden of proving that the dismissal was valid
rests on the employer; failure to do so renders the dismissal illegal. A dismissal based on a just
cause implies that the employee has committed some violation against the employer, hence, it
can be said that the employee initiated the dismissal process.
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
The University is an educational institution duly organized and existing under

Philippine laws. Atty. Ortega is the President and the Chairman of the University's Board of
Trustees. Petitioners were regular employees of the University.
In June 2006, several irregular and anomalous transactions were noted in the
University's Accounting Office. Consequently, in January 2007, Atty. Ortega hired an external
auditor to conduct an investigation. The audit report dated March 13, 2007 revealed a cash
shortage of PHP1,239,856.25, which represents the net collection of book remittances. The
cash should have been kept inside the cash vault under the custody of Lobetania but it was
missing. As a result, Lobetania was asked to go on a leave of absence. She admitted that she
failed to deposit the amount in the University’s bank account and upon demand, she paid it
in installments out of her personal funds. Lobetania went on leave for the duration of the
audit and eventually tendered her resignation. The University filed criminal cases for estafa
against Lobetania and the prosecutor found probable cause to charge her with qualified
theft.
At around the same period, Bance, Dimaiwat, and Aguirre were found to have taken
advantage of their positions in the Accounting Office by enrolling their children and relatives,
Page 122 of 141

Case Digests
including Velasco's, under the University's group enrollment incentive program despite
knowing that they were unqualified. Upon discovery of the fraudulent scheme in November
2007, Atty. Ortega immediately ordered an investigation and called a conference with the
alleged perpetrators.
During the December 2007 conference, petitioners (excluding Lobetania) were

apprised of the infractions they committed. During the conference, they admitted that their
children and relatives indeed benefitted from the unauthorized discounts. Atty. Ortega thus
verbally informed them that their employment will be terminated. On December 22, 2007,
Atty. Ortega issued Office Memo No. 007-026, informing them that their employment will be
terminated effective January 1, 2008 on grounds of dishonesty amounting to malversation
of school funds. The office memo was allegedly not preceded by any written notice to
petitioners except for the two conferences and a verbal announcement during the second
conference.
Dimaiwat, Velasco, and Aguirre opted to resign. They tendered their resignation on
December 22, 2007 (taking effect on January 2, 2008), and these were approved by Atty.
Ortega on December 26, 2007. Bance did not tender her resignation. Subsequently, the
University filed several criminal cases for Estafa against Bance, Dimaiwat, Velasco, and
Aguirre. These are pending before the Municipal Trial Court in Iriga City.
On April 1, 2008, Bance, Dimaiwat, Velasco, and Aguirre filed their respective
complaints for illegal dismissal with money claims against the respondents. Lobetania filed
hers on April 22, 2008. They subsequently amended their complaints to include claims for
unpaid salaries and 13th month pay, and to implead Mrs. Ortega as respondent in
Lobetania's complaint.
On October 1, 2008, the LA rendered a Decision finding petitioners to have been

illegally dismissed and ordering the respondents to reinstate them to their previous or
equivalent positions without loss of seniority rights, and to pay them (jointly and severally)
backwages, unpaid salaries, 13th month pay, holiday pay, damages, and attorney's fees. The
LA also ordered respondents to reimburse Lobetania the amount of P1,239,856.25. The LA
found that the University, as employer, failed to discharge the burden of showing by
substantial evidence that there was just or authorized cause in the dismissal of Bance,
Dimaiwat, Velasco, and Aguirre. As for Lobetania's case, the LA found that the missing funds
were actually used by Mrs. Ortega to pay off her personal obligations. Moreover, Lobetania
was even forced to repay that amount to the University from her personal funds. The LA also
ruled that respondents failed to afford petitioners procedural due process in effecting their
dismissal.
The NLRC reversed and set aside the LA Decision and ruled that petitioners were not
illegally dismissed. It, however, ordered the University to pay Bance indemnity for failure to
Page 123 of 141

Case Digests
observe procedural due process; pay Lobetania her 13th month pay; and, pay all petitioners
their holiday pay for three (3) years.
ISSUES
1. Whether or not petitioners' (except Bance) voluntary resignation render their

complaints for illegal dismissal without basis. (YES)
2. Whether or not Bance was illegally dismissed. (NO)
3. Whether or not the labor tribunal has jurisdiction to resolve the issue of
reimbursement to Lobetania. (NO)
RULING
1. Management prerogative includes the right to discipline employees, which

necessarily includes dismissal of employees based on just and authorized causes. For a
dismissal from employment to be valid, both the substantial and procedural due process
requirements must be satisfactorily complied with. Substantial due process pertains to the
"employee's right not to be dismissed without just or authorized cause, as provided by law."
Procedural due process pertains to the employer's compliance with the procedure in
effecting a dismissal as provided in the Labor Code and implementing rules. The burden of
proving that the dismissal was valid rests on the employer; failure to do so renders the
dismissal illegal. A dismissal based on a just cause implies that the employee has committed
some violation against the employer, hence, it can be said that the employee initiated the
dismissal process.
To comply with the requirements of substantial due process, the cause of the
dismissal must have basis under the law. Failure to observe substantial due process renders
the dismissal illegal and entitles the employee to reinstatement without loss of seniority
rights and other privileges, full backwages inclusive of allowances, and other benefits or
their monetary equivalent. On procedural due process, Article 292 (formerly Article 277) of
the Labor Code provides for the maimer of termination of employment based on just cause.
To comply with the requirements of procedural due process, two notices must be
served to the employee. The conduct of a hearing or conference though is, as held in Perez v.
Philippine Telegraph and Telephone Company, 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." Failure to comply with procedural due
process (although the dismissal is based on just or authorized causes) will entitle the
employee to nominal damages: if the dismissal is based on just cause, the employee is
entitled to P30,000.00; if the dismissal is based on authorized cause, the employee is entitled
to P50,000.00.
Page 124 of 141

Case Digests
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. 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.
2. The Court holds that Bance's dismissal was for a just cause. She willfully breached
the trust that the University has reposed on her. Bance's act of accommodating into the
University's group enrollment incentive program unqualified beneficiaries, including the
children and relatives of the petitioners, constitute willful breach of trust. As stated, to
constitute willful breach of trust, the employee concerned must be holding a position of trust
and confidence, and there must be a willful act that would justify the loss of trust and
confidence.Hence, Bance's position as Senior Accounts Officer, being supervisory in nature,
can be considered as a position of trust.
The Court, however, does not agree with the CA on its ruling on the aspect of
procedural due process. As discussed above, to comply with the requirement of procedural
due process, two written notices must be issued. The first written notice should contain the
specific causes or grounds for termination against the employee. The second written notice
contains the decision terminating the employment after considering all circumstances
involving the charge.
Records show that during the events leading to Bance's dismissal, two conferences
were held, after which, Office Memo No. 007-026 was issued to inform her (and Dimaiwat,
Velasco, and Aguirre) of the termination of her employment effective January 1, 2008.
Clearly, these are not compliant with the requirements established by law. Only the second
written notice or Office Memo No. 007-026, was served on Bance. The records show that no
first written notice was given to Bance. Conferences and verbal announcements do not
suffice as substitute for the requisite first written notice. Applying Agabon v. National Labor
Relations Commission, Bance is therefore entitled to nominal damages in the amount of
P30,000.00.
3. After a judicious review of the records, respondents are not liable to reimburse the
amount to Lobetania. As found, the amount pertains to the cash shortage that was
unaccounted for. Lobetania subsequently paid the amounts to the University as evidenced
by official receipts issued by the University under her name. It can then be concluded that
the purpose of the payment was to return the cash shortage. Thus, the University is not
obligated to return this amount to Lobetania.
If Lobetania insists that there was a personal accommodation between her and Mrs.
Ortega, the NLRC and the CA are correct in ruling that the matter should be litigated before
Page 125 of 141

Case Digests
the regular courts. In unpaid debts such as this, the facet of employer-employee relationship
is merely incidental and the cause of action proceeds from a different source of obligation.
Page 126 of 141

Case Digests
REYNALDO P. CABATAN VS. SOUTHEAST ASIA SHIPPING CORP./ATTY. ROMEO

DALUSONG AND/OR MARITIME MANAGEMENT SERVICES
DOCTRINE
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 requirement if he was physically
incapacitated to do so
FACTS
Petitioner Reynaldo P. Cabatan (Cabatan) was employed as an oiler by Southeast Asia

Shipping Corp. (SEASCORP) on behalf of its principal, Maritime Management Services
(Maritime Management) from 2006 to 2010.6 Before deployment, he underwent his Pre-
Employment Medical Examination (PEME) and was certified to be fit for sea duty.
On March 29, 2010, Cabatan while he was on duty, nearly fell on his knees then , he
felt excruciating pain in his scrotal/inguinal area. When he got checked by the ship's doctor,
the latter advised him to rest until further observation since it may just be due to tiredness.
Furthermore, the doctor ruled out hernia and trauma.
Cabatan was re-examined by the doctor. He still felt pain during prolonged standing
or while walking, with numbness of his lower extremity. However, the doctor concluded that
this was normal considering his age and was just advised to take pain relievers. Upon
expiration of his contract on May 25, 2010, Cabatan disembarked the vessel and was
repatriated back to the Philippines. Believing that the pain in his scrotal/inguinal area was
normal and, as the doctor had advised, he took a complete rest for about a month.
When he had his medical examination again for possible employment, Cabatan
informed the doctor about the injury where he was asked to undergo several examinations
which were costly. Due to the costly price of the procedures, Cabatan asked for financial
assistance from SEASCORP through its crewing manager, but the request was left unheeded.
After further consultation with a spine surgeon, there was an estimated surgery amounting
to P473,000.00.
Cabatan filed a complaint against the respondents for permanent and total disability
benefits. On the other hand, 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,
Page 127 of 141

Case Digests
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.
ISSUE
Whether or not petitioner is entitled to disability compensation for the injury/illness

suffered during the term of his employment
RULING
NO. It is undisputed that Cabatan's employment contract with SEASCORP executed

on January 30, 2010 is governed by the 2000 Amended Standard Terms and Conditions
Governing the Overseas Employment of Filipino Seafarers On-Board Ocean-Going Ships
(2000 POEA-SEC).
In order to claim compensability under the forgoing section, 1t 1s 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.
As explained in Jebsens Maritime, Inc. v. Undag, the purpose of the three-day

mandatory reporting requirement is to enable the company-designated physician to
ascertain if the seafarer's injury or illness is work-related. However, the three-day reporting
requirement is not absolute as correctly pointed out by Cabatan. Paragraph 3, Section 20 (B)
of the POEA-SEC also provides that a seafarer who is physically incapacitated to report for
a post-employment examination may send a written notice to its agency within the same
period.
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
requirement if he was physically incapacitated to do so. However, such is not the case at bar.
While this Court commiserates with petitioner's plight, non-compliance with the
requirements set fo1ih in Section 20 (B), paragraph (3) of the 2000 POEA-SEC renders it
difficult to ascertain if his injury or illness was work.-related.
Page 128 of 141

Case Digests
GEROME B. GINTA-ASON VS. J.T.A. PACKAGING CORPORATION

AND JON TAN ARQUILLA
DOCTRINE
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 petitioner 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, petitioner failed to discharge this burden.
FACTS
On January 30, 2017, Gerome Ginta-Ason (petitioner) 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 (JTA) and Jon Tan Arquilla (Arquilla collectively,
respondents).
Petitioner’s version: Petitioner alleged that he was hired by JT A on December 26, 2014
as an all-around driver until his constructive dismissal on September 5, 2016. During payday
of September 5, petitioner asked his live-in partner to go with him. After receiving his salary,
petitioner asked permission from Arquilla to leave since Chancie was waiting for him outside
of the office premises. However, instead of allowing petitioner to leave, Arquilla allegedly
instructed Rodil, his personal collector, to bring Chancie inside the office.
Arquilla eventually hit the petitioner, asked Chancie to kneel, and threatened to kill
both of them. Arquilla then illegally detained Chancie and petitioner in the office and were
released only the next day. Out of fear, petitioner decided not to report to work anymore.
Petitioner claimed that he was constructively dismissed because Arquilla made his
continued employment impossible, unbearable, and unlikely.
Respondent’s version: JTA averred that petitioner was not its employee. In support
thereof, JTA submitted:
1) copies of its alpha list of employees as filed with the Bureau of Internal Revenue
(BIR) for the years 2014-2016;
2) payroll monthly reports and 13th month pay it paid for the years 2015-2016;
Page 129 of 141

Case Digests
3) reports on Social Security System (SSS) contributions of its employees remitted for
the year 2015-2016;
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.
All of the foregoing documents did not include petitioner's name. Further, JTA
claimed that Arquilla is not the owner of JTA as evidenced by its articles of incorporation
which shows that Arquilla was neither a stockholder nor connected in any capacity with the
company.
ISSUE
Whether or not there is an employer-employee relationship existing between

petitioner and JTA at the time of petitioner's dismissal
RULING
NO. 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
petitioner 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, petitioner failed to
discharge this burden.
To begin with, from the lowest tribunal up to this Court, JTA has consistently denied
having employed petitioner. It maintained that petitioner is a stranger and was never an
employee of JTA. Considering such denial, it was incumbent upon petitioner to prove the fact
of his employment with JTA. However, nothing to this effect has been proven by petitioner.
He presented no document setting forth the terms of his employment. In particular, no
contract of employment or written agreement was introduced by petitioner to establish the
true nature of his relationship with JTA. Evident also is the lack of a company identification
card to prove petitioner's employment with JTA.
To prove the element of payment of wages, petitioner submitted pay slips allegedly
issued by JTA. Significantly, the pay slips presented by petitioner bore no indication as to
their source. Absent any clear indication that the amount petitioner was allegedly receiving
came from JTA, payment of wages cannot be established. Additionally, there were no
deductions from petitioner's supposed salary such as withholding tax, SSS, Philhealth or Pag-
Ibig Fund contributions.
Page 130 of 141

Case Digests
As to the power of control, petitioner insists that the copies of driver's itinerary issued
by JTA clearly manifest that it exercised control over the means and methods by which
petitioner performed his tasks. While it is true that the purported driver's itineraries
presented by petitioner prescribed the manner by which his work as a driver is to be carried
out, said driver's itineraries were not signed by JTA's authorized personnel.
Absent this, it cannot be ascertained who actually exercised control over petitioner.
Thus, the herein driver's itineraries did not adequately establish the element of control.
In sum, petitioner failed to sufficiently discharge the burden of showing with legal
certainty that employee-employer relationship existed between him and JTA. On the other
hand, it was clearly shown by JTA that petitioner was not among its employees.
Consequently, the allegation that he was illegally dismissed by JTA must necessarily fail.
Page 131 of 141

Case Digests
COLEGIO SAN AGUSTIN-BACOLOD V. MONTAÑO

DOCTRINE
There is diminution of benefits when the following are present: (1) the grant or benefit
is founded on a policy or has ripened into a practice over a long period of time; (2) the practice
is consistent and deliberate; (3) the practice is not due to error in the construction or
application of a doubtful or difficult question of law; and (4) the diminution or discontinuance
is done unilaterally by the employer. Here, it must be emphasized that there was no showing in
these proceedings that respondent received honorarium prior to her 2009 reappointment as
school registrar. Her prior appointments stated that she was to receive compensation
equivalent to a certain number of load or units pertaining to her academic rank; there
was no mention of payment of honorarium then. Thus, it is but fair and just to conclude that
the entire P33,319.00 that respondent had received prior to her 2009 reappointment is
considered as her monthly basic pay. As it was established that respondent continued to receive
the same amount of P33,319.00 despite the addition of honorarium for the 2009
reappointment, it can be concluded then that the basic pay indeed was reduced. This resulted
to diminution of benefit that is expressly prohibited by the Labor Code.
FACTS
Respondent was first employed by petitioner as a chemistry instructor in 1973. In

2003, she was appointed school registrar; her appointment was renewed several times.
Respondent alleged that in her reappointment letter for the 2009-2011 term, there was a
diminution of her salary; her basic salary was reduced from P33,319.00 to P26,658.20. The
President stated that her total gross pay did not change as the school merely opted to break
down the amount to show the amount of honorarium. Respondent claimed that this was the
time when the president started to show his bias against her. Thereafter, respondent was
suspended, and her employment was eventually 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 claimed that she merely continued the
practice of previous registrars; she even imposed more stringent rules in determining when
ineligible students may join the rites.
CSA-Bacolod, for its defense, posited that respondent's suspension and eventual
dismissal was due to gross misconduct resulting to loss of trust and confidence. The
concerned faculty members submitted reports naming four students who were allowed to
participate despite failing in some of their subjects. A notice of charges was issued to
respondent for gross misconduct, tampering of school records, and willful breach of trust
and confidence or gross negligence. At the same time, she was placed under preventive
Page 132 of 141

Case Digests
suspension for 30 days. Although, respondent submitted her response to the notice, she
refused to attend the hearing. Another hearing was held and respondent attended this time.
The Ad Hoc Committee deliberated and thereafter recommended the termination of
respondent's employment for gross misconduct and willful breach of trust and
confidence. The president then issued a notice of termination.
Respondent then filed a complaint for illegal suspension, illegal dismissal, separation
pay, diminution of benefits, moral and exemplary damages, and attorney's fee. The LA ruled
in favor of respondent, finding her suspension and dismissal illegal. Thereafter, the NLRC
reversed the LA and ruled that respondent was validly dismissed. It also ruled that she is not
entitled to salary differentials. The CA reversed the NLRC Decision and reinstated the LA
Decision with modification on the award of money claims.
ISSUE
1. Whether respondent was illegally dismissed from service; and

2. Whether respondent is entitled to a salary differential as a result of the alleged
diminution of benefits
RULING
1. NO. The Court agreed with the NLRC that respondent committed serious
misconduct in allowing ineligible students to march. She violated an established school
policy as espoused in a memorandum issued by the university. The memorandum states that
"no student will be allowed to march for graduation unless he/she has fully complied with
all the academic requirements of his/her course."
Circumstances show that respondent's act is clearly a conscious and willful

transgression of the university's established rule regarding graduation rites. It is not a mere
error in judgment or an inadvertent act. The rule is very clear that students who did not
comply with all the academic requirements shall not be allowed to march in the graduation
rites. Respondent was consistent in reiterating this rule; she even reminded the deans to
observe the policy. Yet, she herself made a conscious decision or choice to violate the
established rule that she insisted to be followed in allowing the ineligible students to march.
This also surely renders her unfit to continue working as school registrar because her act
relates to her duties as such.
2. YES. There is diminution of benefits when the following are present: (1) the grant
or benefit is founded on a policy or has ripened into a practice over a long period of time; (2)
the practice is consistent and deliberate; (3) the practice is not due to error in the
construction or application of a doubtful or difficult question of law; and (4) the diminution
or discontinuance is done unilaterally by the employer. Here, the Court found that there was
Page 133 of 141

Case Digests
indeed a diminution of benefit. The explanation of the school that the amount was merely
broken down fails to convince. It must be emphasized that there was no showing in these
proceedings that respondent received honorarium prior to her 2009 reappointment as
school registrar. Her prior appointments stated that she was to receive compensation
equivalent to a certain number of load or units pertaining to her academic rank; there
was no mention of payment of honorarium then. Thus, it is but fair and just to conclude that
the entire P33,319.00 that respondent had received prior to her 2009 reappointment is
considered as her monthly basic pay. As it was established that respondent continued to
receive the same amount of P33,319.00 despite the addition of honorarium for the 2009
reappointment, it can be concluded then that the basic pay indeed was reduced. This resulted
to diminution of benefit that is expressly prohibited by the Labor Code.
Page 134 of 141

Case Digests
C.F. SHARP CREW MANAGEMENT INC. AND/OR REEDEREI CLAUS-PETER OFFEN

(GMBH & CO.), v. ROBERTO B. DAGANATO
G.R. No. 243399, July 6, 2022, First Division (Hernando, J.)
DOCTRINE
Jurisprudence dictates that permanent total disability means "disablement of an

employee to earn wages in the same kind of work or work of a similar nature that he was
trained for or accustomed to perform, or any kind of work which a person of his mentality and
attainment can do." As aptly observed by the PVA and as affirmed by the CA, due to his injuries,
respondent can no longer resume his seafaring activities or work as a chief cook as it requires
him to be in excellent physical condition. As correctly observed, respondent's total and
permanent disability is bolstered by the fact that he was no longer deployed back to work and
can no longer earn based on the job for which he was customarily trained to do. Perforce,
respondent should be entitled to total and permanent disability benefits under the CBA.
FACTS
On June 25, 2014, respondent Roberto Daganato signed a Contract of with petitioner CF
Sharp as Chief Cook for six months on board the vessel MV Vancouver Express, owned by
petitioner Reederei. The contract expressly incorporated the provisions of the current ITF
Collective Bargaining Agreement (CBA). After undergoing premedical examination,
respondent was declared fit to work.
Thereafter, or on December 27, 2014, while carrying a heavy provision of food,

respondent claimed that he suddenly slipped and fell causing mild to moderate pain on his
lower back area. The pain persisted and his condition worsened until he was medically
repatriated on January 10, 2015. He was referred to Cardinal Santos Medical Center where
he was subjected to MRI and CT Scan of the Lumbar Spine. Respondent's MRI results yielded
the following impressions:
1. Mild L4-5 disc bulge, asymmetric to the right, abutting the traversing right LS nerve
root. No focal disc herniation at any level.
2. Mild bilateral L4-5 facet and ligamentum flavum hypertrophy with no associated
spinal canal or foraminal narrowing.
3. Diffuse heterogeneous vertebral marrow signal, of uncertain etiology.
Meanwhile, respondent's CT scan results showed that he was suffering from Mild
Posterior Disc Bulge, L4-L5 Facet Hypertrophy, and L4-L5 Thoracolumbar Spondylosis.
Due to these findings, respondent underwent physiotherapy but to no avail. Thus,

respondent underwent bilateral polypectomy and endoscopic sinus surgery. Respondent
Page 135 of 141

Case Digests
also underwent spinal surgery and a series of physiotherapy. However, despite the medical
procedures and treatments, respondent claimed that he never regained the necessary fitness
to resume seafaring duties. Respondent then sought the opinion of Dr. Manuel M. Magtira.
Dr. Magtira, in his medical report, observed that the respondent lost his pre-injury capacity
and is unfit to work back at his previous occupation. The respondent is now permanently
disabled.
Considering these medical findings, respondent sent CF Sharp a letter where he claimed
for total and permanent disability benefits and expressed his willingness to undergo another
examination to confirm his physical condition. According to respondent, CF Sharp simply
ignored his letter prompting the respondent to file a grievance before the Associated Marine
Officer's and Seamen's Union of the Philippines which, however, did not yield a positive
result.
In view of the foregoing, respondent filed a Complaint for total permanent disability
benefits, medical reimbursement, moral and exemplary damage, and attorney's fees against
petitioners before the NCMB, which was assigned to a PVA. . The PVA dismissed respondent's
claims for damages but nonetheless granted his claims for total permanent disability benefits
and attorney's fees. Aggrieved, CF Sharp filed a Motion for Reconsideration but was denied.
Petitioners filed a Petition for Review before the Court of Appeals. The appellate court,
however, dismissed the appeal and affirmed with modification the PVA Decision. Petitioners
subsequently filed a Motion for Reconsideration but was denied.
ISSUE
Whether or not the CA committed a reversible error in affirming the PVA Decision
which awarded total and permanent disability benefits to respondent Daganato.
RULING
NO. As there was no final assessment on respondent's disability in accordance with

Clause 25.2 of their CBA, the rules in determining what constitutes total and permanent
disability under the Labor Code, as amended, its implementing rules and regulation (IRR),
the POEA-SEC, and prevailing jurisprudence should be instructive.
Article 198(c)(1) of the Labor Code provides:
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;
Page 136 of 141

Case Digests
Meanwhile, Rule X, Section 2 of the Rules and Regulations implementing Title II, Book
IV of the Labor Code 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.
These provisions are to be read hand in hand with the POEA-SEC, Section 20(3) of
which states in part:
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 one hundred twenty (120) days.
The records show that respondent was medically repatriated on January 10, 2015,
contrary to petitioners' claim that respondent was repatriated due to a finished contract. We
agree with the PVA's observation that respondent would not have been referred by
petitioners for medical examination or allowed to undergo two major surgeries if his
contract simply ended.
The company-designated physician, however, was able to issue a Certification

declaring respondent with a disability rating of "Grade 11-slight rigidity or 1/3 loss of lifting
power of the trunk," only on June 15, 2015,85 which is the are reckoned from the time
respondent was medically repatriated, without any assessment or indication as to his
capacity to resume to work, or any justification to extend the 120-day period. Clearly,
respondent's disability has become total and permanent upon failure by the company-
designated physician to issue a final and determinative assessment within the 120-day
period required under the rules.
On the other hand, respondent's medical report dated July 30, 2015 clearly certifies
that he is permanently disabled to resume his work as a seafarer. As between the two
medical findings, respondent's medical certificate clearly detailing the nature of his disability
and extent of incapacity should prevail, and his entitlement to total and permanent disability
benefits under the CBA, as unanimously found by the PVA and the CA, should be upheld.
Page 137 of 141

Case Digests
Furthermore, jurisprudence dictates that permanent total disability means

"disablement of an employee to earn wages in the same kind of work or work of a similar
nature that he was trained for or accustomed to perform, or any kind of work which a person
of his mentality and attainment can do." As aptly observed by the PVA and as affirmed by the
CA, due to his injuries, respondent can no longer resume his seafaring activities or work as a
chief cook as it requires him to be in excellent physical condition. As correctly observed,
respondent's total and permanent disability is bolstered by the fact that he was no longer
deployed back to work and can no longer earn based on the job for which he was customarily
trained to do. Perforce, respondent should be entitled to total and permanent disability
benefits under the CBA.
Page 138 of 141

Case Digests
PHILIPPINE TRANSMARINE CARRIERS, INC AND/OR SEASPAN CREW MANAGEMENT

LTD. AND/OR CARLOS SALINAS v. ALLAN N. TENA-E
G.R. No. 234365, July 06, 2022, First Division, Hernando, J:
DOCTRINE
The entitlement of a seafarer on overseas employment to disability benefits is governed

by law, by the parties' contracts, and by the medical findings.
A temporary total disability only becomes permanent if the company-designated

physician declares it to be so within the 120-day period, or 240-day period, provided the
extension was justified in the latter case, or after the lapse of such periods, and no declaration
is made by the company-designated physician. The mere lapse of the 120/240-day period does
not automatically entitle a seafarer to total and permanent disability benefits.
Section 20 (A) of the 2010 POEA-SEC provides that it is the seafarer's duty to 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 and he
shall also regularly report to the companydesignated physician specifically on the dates as
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.
FACTS
On July 08, 2014, Philippine Transmarine Carriers Inc (PTCI) hired Allan N. Tena-e
(Allan) as a seafarer for and in behalf of its foreign principal, Seaspan Crew Management
Limited (Seaspan), under a nine-month contract.
On October 05, 2014, while on cargo-watch duty, Allan had an accident when a
turnbuckle fell on his right shoulder. He was found to be unfit for sea duty due to his
displaced right clavicular fracture.
On October 20, 2014, he was medically repatriated to the Philippines. The following
day, he was immediately referred to ShiptoShore Medical Assist (ShiptoShore) and St. Luke’s
Medical Center for examination, management, and treatment. The company-designated
doctors, Dr. John Sañez and Dr. Marilar De Guzman, diagnosed Allan with a fractured and
displaced right clavicle.
Allan was given a treatment plan consistng of home exercises, regular x-rays, and
therapy sessions. From November 2014 to March 2015, Allan continued with his monthly
Page 139 of 141

Case Digests
therapy and rehabilitation as supervised by the company-designated doctors. He was

showing signs of improvements but still feeling pain while moving.
In the March 16, 2015 medical report, Dr. Sañez and Dr. De Guzman made an interim
assessment of Disability Grade 12 noting a projected return to full load capacity from 4 to 6
months post trauma event. Allan was scheduled for re-evaluation with the doctors tentative
April 13, 2015.
However, on March 26, Allan, through counsel, sent a letter to Dr. Sañez asking if
further treatment was still needed beyond the 120-day period after his repatriation. His
query was left unanswered. He did not appear for his April 13 doctor’s appointment. Instead,
on April 18, Allan consulted his physician of choice (Dr. Catapang Jr and Dr. Pimentel) who
declared Allan unfit for sea duty with permanent disability.
On April 20, 2015, Allan initiated SenA proceedings to claim permanent and total
disability benefits. Subsequently, he filed a complaint against petitioners for disabillity
benefits, unpaid sick wages, reimbursement for transportation and medical expenses, as well
as damages with attorney’s fees.
In petitioners’ Position Paper, they averred that Allan abandoned his treatment when
he did not show up on the date of his follow up check-up thereby forfeiting his right to claim
for disability benefits pursuant to Section 20 (a), no. 3, par (3) of POEA Standard
Employment Contract.
In Allan’s Position Paper, he maintained that he is entitled to total and permanent

disability benefits. He argued that 181 days have lapsed since his repatriation and PTCI still
failed to issue a final assessment of his disability. Thus, his disability became total and
permanent after the lapse of 120 days considering that he is unable to engage in gainful
employment.
The Labor Arbiter (LA) ruled in favor of Allan and held that Allan did not abandon his
treatment when he sent his March 26 letter and that the absence of a final assessment by the
company-designated physician after the lapse of the 240-day period from repatriation
entitled Allan to total and permanent disability benefits by operation of law. The NLRC
affirmed the LA’s decision and the CA agreed with the findings of the lower tribunals.
ISSUE:
Whether or not Allan is entitled to permanent total disability benefits. (NO)
RULING:
Page 140 of 141

Case Digests
The Court held in the negative. The entitlement of a seafarer on overseas employment
to disability benefits is governed by law, by the parties' contracts, and by the medical
findings.
Section 20 (A) of the 2010 POEA-SEC, which is the rule applicable to this case since
Allan was employed in 2014, provides that it is the seafarer's duty to 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 and he
shall also regularly report to the companydesignated physician specifically on the dates as
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.
In the case at bar, Allan was placed under the care of the company-designated doctors
from October 2014 to March 2015. During this time, he underwent therapy and
rehabilitation under the supervision of ShiptoShore's Orthopedic Shoulder Specialist.
Because he was still feeling pain while moving, Allan's treatment went beyond 120-day
period and the doctor's findings and schedule for reevaluation clearly constitute a significant
act that justified the extension of petitioner's treatment period to 240 days.
Dr. Sañez only issued an interim assessment, which is not the final and definitive
assessment required under the law. A final and definitive disability assessment is required
in order to truly reflect the extent of the illness of the seafarer, and his or her capacity to
resume work as such. To be conclusive, the medical assessments or reports should be
complete and definite to afford the appropriate disability benefits to seafarers. However,
PTCI cannot be faulted for its company-designated physician's failure to issue a final and
definitive disability assessment. Dr. Sañez had until June 17, 2015, or before the lapse of 240
days from repatriation, within which to issue his final assessment. However, Allan did not
appear on the scheduled reevaluation on April 13, 2015 making it impossible for Dr. Sañez
to examine him.
Based on the foregoing, Allan breached his duty by not showing up on his scheduled
April 13, 2015 appointment thereby effectively preventing Dr. Sañez from making a final
disability assessment. Since Allan was still undergoing treatment by the company doctor and
has been showing signs of improvement, and was even asked to come back for possible
clearance, there was an indication that further treatment would address his temporary
disability. A temporary total disability only becomes permanent if the company-designated
physician declares it to be so within the 120-day period, or 240-day period, provided the
extension was justified in the latter case, or after the lapse of such periods, and no declaration
is made by the company-designated physician. The mere lapse of the 120/240-day period
does not automatically entitle a seafarer to total and permanent disability benefits.
Page 141 of 141

2023 UST Labor Law Case Digests (J. Hernando)

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

2023 UST Labor Law Case Digests (J. Hernando)

Uploaded by

Copyright:

Available Formats

Case Digests

PONENCIAS OF JUSTICE HERNANDO

ALLAN REGALA v. MANILA HOTEL CORPORATION

Moreover, there is constructive dismissal where "there is cessation of work because

1. Whether or not Regala is a regular employee of MHC.

First, Regala is performing activities which are usually necessary or desirable

beverage operations, event planning and hospitality. As such, it is essential, if at all

2. YES. There is constructive dismissal where "there is cessation of work because

No objection or a motion for reconsideration was interposed against the judgment of

Whether or not retirement benefits, other gratuities, and survivorship pension

Retirement is the termination of one's own employment or career, especially upon

Section 1 of RA 9946 yields two instances of retirement available to a magistrate —

Having determined the entitlement of Chief Justice Corona to retirement benefits, it

RE: EXPENSES OF RETIREMENT OF COURT OF APPEALS JUSTICES.

Whether or not it is appropriate to grant an increase in the retirement program

PHILIPPINE TRANSMARINE CARRIERS, INC., CARLOS C. SALINAS, AND/OR GENERAL

LA ordered respondents to pay complainant his permanent total disability benefit

PHILIPPINE NATIONAL BANK v. MANUEL C. BULATAO

Whether Bulatao was illegally dismissed

In addition, Bulatao categorically withdrew his application to retire as mentioned in

Further, filing an illegal dismissal case is inconsistent with abandonment, as in his

PEDRITO R. PARAYDAY AND JAIME REBOSO v. SHOGUN SHIPPING CO., INC.

Respondent denied that petitioners were engaged by Shogun Ships as regular

1) Whether petitioners were regular employees of Shogun Ships; and

1. YES. In determining the existence of an employer-employee relationship, this Court

The application of the four-fold test shows that an employer-­employee relationship

Considering that petitioners were working on the barges alongside regular

2. NO. It is an established principle that the dismissal of an employee is justified

ARLENE PALGAN v. HOLY NAME UNIVERSITY AND/OR FR. FRANCISCO ESTEPA,

Petitioner started working as a Casual or Assistant Clinical Instructor for 2 semesters

For S.Y. 1995-1996, 1996-1997 and 1997-1998, Arlene received letters of

Whether petitioner was illegally dismissed

NO. The governing law for the employment status of teachers/professors/instructors

In Lacuesta v. Ateneo de Manila University, We held that the Manual of Regulations

OMANFIL INTERNATIONAL MANPOWER DEVELOPMENT CORPORATION V.

Petitioner Omanfil International Manpower Development Corporation hired Rolando

Aggrieved by what he believed to be termination of his employment without any legal

Whether respondent was illegally dismissed

MARLOW NAVIGATION PHILS. V. HEIRS OF ANTONIO O. BEATO

Whether the death of the late Antonio is compensable

As regards those diseases not otherwise considered an occupational disease under

Pancreatic cancer is not an occupational disease. Although the CA afforded Antonio

EDGARDO I. MABALOT V. MAERSK-FILIPINAS CREWING, INC

Whether petitioner is entitled to permanent total disability benefits

NO. The entitlement of a seafarer on overseas employment to disability benefits is

NINIA P. LUMAUAN V. COMMISSION ON AUDIT

Petitioner Ninia P. Lumauan was the Acting General Manager of Metropolitan

Whether respondent COA-CP committed grave abuse of discretion in disallowing the

Petitioner's reliance on the pronouncement of the Court in Philippine Ports Authority

However, the records showed none of the extenuating circumstances to be present.

LUFTHANSA TECHNIK PHILIPPINES, INC., ANTONIO LOQUELLANO

1. Cuizon's willful concealment of the accidental light-up of PAL Aircraft EI-BZE on 10

Whether or not Cuizon was illegally dismissed.

We find that petitioners failed to discharge the burden.

“All surrounding circumstances must be considered and the penalty must be

In 1990, Cathay hired Salvacion A. Lamadrid as a cabin crew. Cathay's Conditions of

Whether or not Lamadrid was illegally dismissed.

However, while the weight of evidence points to Lamadrid's infraction of company

MARK ELISEUS M. VILLOLA v. UNITED PHILIPPINE LINES, INC.

“Resignation is defined as a formal pronouncement or relinquishment of an office, with

Thereafter, on October 11, 2014, UPL released a Memorandum informing UPL

Whether or not Villola was illegally dismissed.

Resignation is defined as a formal pronouncement or relinquishment of an office, with

The application of the four-fold test shows that an employer-employee relationship