LABOR CASE DIGESTS.docx

LABOR CASE DIGESTS

Labor Standards and Social Legislation Arellano University School of Law 5:30-8:30 pm, Thursday Dean Porfirio DG. Panganiban, Jr.

KAREN CAMILLE SATIADA

LIST OF CASES

Article 1-6: Labor in General Maternity Children’s Hospital vs. Secretary of Labor Calalang vs. Williams 3. People vs. Vera Reyes 4. People vs. Pomar 5. Phil. Association of Service Exporters Inc vs. Drilon 6. Cerezo vs. Atlantic Gulf and Pacific Co 7. Abella vs. NLRC 8. Euro-Linea, Phils. Inc, vs. NLRC 9. Manila Electric Company vs. NLRC 10. Sosito vs. Aguinaldo Development Corporation 11. Colgate Palmolive Philippines vs. Ople 12. Mendoza vs. Rural Bank of Lucban 13. Gelmart Industries Phils. Inc. vs. NLRC 14. Lagatic vs. NLRC 15. China Banking Corporation vs. Borromeo 16. Associated Watchmen and Security Union vs. Lanting 17. Pampanga Bus Company vs. Pambusco Employees 18. Gregorio Araneta Employees vs. Roldan 19. Phil. Steel Worker’s Union vs. CIR 20. Tiong King vs. CIR 21. Roldan vs. Cebu Portland Cament. Co Article 5: Rules and Regulations 1.

2.

Rizal Empire Insurance Group vs. NLRC Philippine Association of Service Exporters vs. Drilon 24. CBTC Employers Union vs. Clave Article 6: Applicability 22. 23.

National Housing Corporation vs. Juco National Service Corp vs. NLRC 27. Republic vs. CA 28. Luzon Development Bank vs . Association of Luzon Development Bank et.al. 29. Social Security System Employees Association vs. CA Article 7-11: Emancipation of Tenants 25.

26.

30. 31. 32.

Association of Small Landowners of the Philippines vs. Secretary of Agrarian Reform Acuna vs. Arroyo Pabico vs. Juico

Maanay vs. Juico 34. Alita vs. CA 35. Gonzales vs. CA 36. Luz farms vs. Secretary of Agrarian Report Article 13: Recruitment and Placement 33.

37. 38. 39.

People vs. Panis People vs. Goce Darvin vs. CA and People of the Philippines

Article 19-24: Overseas Employment 40. 41. 42. 43. 44. 45. 46. 47. 48. 49. 50. 51. 52. 53. 54.

Eastern Shipping Lines vs. POEA Abdu Basar and Kathleen Saco PHILSA International Placement vs. Secretary of Labor Pacific Asia Overseas Shipping Corp. vs. NLRC Millares and Lagda vs. NLRC Tierra International Corporation vs. NLRC Dilan vs. POEA Administrator Vinta Maritime Co. vs. NLRC and Basconcillo Marsaman Manning Agency vs. NLRC Asian Center for Career and Employment Services vs. NLRC and Ibno Mediales Athena International Manpower services Inc. vs. Villanos Eastern Shipping Lines vs. POEA Inter Orient Maritime Enterprise Inc. vs. NLRC Norse Management Corporation vs. National Seamen Board NFD International Manning Agents vs. NLRC, et al.

Article 20: National Seamen Board Phil.International Shipping Corporation vs. NLRC Mc Kenzie vs. Cul 57. Virjen Shipping and Marine Services vs. NLRC 58. Suzara vs. Benipayo 59. Chavez vs. Bonto-Perez, Rayala, et al. Article 25-39: Regulations of Recruitment and Placement Activities 55.

56.

Finman General Assurance vs. Inocencio 61. Eastern Assurance and Surety Corp. vs. Secretary of Labor 62. Salazar vs. Achacoso and Marquez Article 34: Prohibited Practices 60.

Soriano vs. offshore Shipping and Marketing corp. Seagull Maritime Corp. vs. Balatongnan Article 35: Suspension and/or Cancellation of License Authority 63.

64.

65.

Catan vs. NLRC

Royal Crowne International vs. NLRC 67. Facilities Management Corp. vs. De La Osa Article 38: Illegal Recruitment 66.

People of the Philippines vs. Bulu Chowdry People of the Philippines vs. Cabais 70. People of the Philippines vs. Flores 71. People vs. Sagayado 72. People vs. Benzon Ong 73. People vs. Calonzo 74. People vs. Hernandez 75. People vs. F. Hernandez, K. Reichl and Y.G. de Reichl 76. People vs. tan Tiong Meng 77. People vs. Arabia and Tomas 78. People vs. Verano 79. People of the Philippines vs. Espanol 80. People of the Philippines vs. Roxas 81. People of the Philippines vs. Remullo 82. People of the Philippines vs. S. Angeles Article 40: Employment of Non-Resident Aliens 68. 69.

Almodiel vs. NLRC, et al. 84. General Miling Corp. vs. Torres 85. Dee C. Chuan and sons vs. CIR Article 57-72: Apprentices 83.

Nitto Enterprises vs. NLRC and R. Capili Filamer Christian Institute vs. Hon. Intermediate Appellate Court Article 82-95: Conditions of Employment 86.

87.

“Brotherhood” Labor Unity Movement of the Philippines vs. Zamora Tabas, et., al vs. California Manufacturing Co. et al. 90. Sevilla vs. CA 91. Continental Marble Corporation vs. NLRC 92. Encyclopedia Britannica Inc. vs. NLRC 93. Dy Keh Beng vs. International Labor and Marine Union 94. Zanotte Shoes vs. NLRC 95. Air Material wing Savings and Loan association inc. vs. NLRC 96. Hydro Resources Contractors Corp. vs Pagalilauan 97. Insular Assurance Co. vs. NLRC 98. Angelina Francisco vs. NLRC , Kasei Corp. etc 99. Opulencia Ice Plant vs. NLRC 100. Domasig vs. NLRC 101. Equitable Banking Corporation vs. NLRC and R.L. Sadac 102. Zamudio vs. NLRC 103. Paguio vs. NLRC et.al. 104. Great Pacific Life Assurance Corp. vs. Judico 88. 89.

105. Feati

University vs. Hon. Jose S. Bautista and Feati Faculty Club 106. Citizens League of Free Workers et, al vs. Abbas 107. Villamaria vs. CA and Bustamante 108. Sy et.al vs. Hon. Court of Appeals and J. Sahot 109. Makati Haberdashery , Inc, vs., NLRC 110. Cauddanetaan Piece Workers Union vs. Undersecretary Bienvenido Laguesma 111. Ruga et.al. vs. NLRC 112. A. Maraguinot and P.Enero vs. NLRC and Viva Films 113. Orlando Farm Growers vs. NLRC Article 82: Excluded Employees National Sugar Refineries Corp. vs. NLRC 115. Penaranda vs. Banganga Plywood Corp et.al. 116. Auto Bus Transport System Inc . vs. Bautista 117. Union of Filipino Employees vs. Vivar 118.San Miguel Brewery Inc. vs. Domestic Labor Organization 119. Abundio Cadiz vs. Philippine Sinter Corporation 120. Rosales vs. Tan Que 121. Adriano Quintos vs. D.D Transport Co., Inc., 122. Lara vs. Del Rosario Article 83: Hours of Work 114.

123. Manila

Terminal Co. Inc vs. CIR et.al Laboratories Employees Union FFW, et al vs. Interphil Laboratories

124. Interphil

Article 84: Hours Worked 125. Pan

American World Airways System vs. Pan American Employees Association 126. Jose Gayona vs. Good Earth Emporium and Supermarket 127. University of Pangasinan Faculty Union vs. University of Pangasinan 128. Luzon Stevedoring Co. Inc. vs. Luzon Marine Department Union 129. Cagampan et. al vs.NLRC 130. National Development Company vs. CIR 131. FSime Darby Pilipinas Inc vs. NLRC 132. Mercury Drug Co Inc vs. Nardo Dayao et.al 133. National Shipyards and Steele Corporation vs. 134. Bisig ng Manggagawa ng Philippine Refining Co. Inc 135. PNB vs. PNB Employees Assn 136. Pamapanga Sugar Development Co. vs. CIR Article 87-88: Offset Overtime 137.NWSA vs. NWSA Consolidated Unions Article 91-93: Rest Days 138. Cf: De Leon vs. Pampanga Sugar Development Co Inc

139. Sto.

Domingo vs. Phil. Rock Products Article 94: Holiday and Holiday Pays 140. Jose

Rizal College vs. NLRC and NATOW San Miguel Corp vs. CA et. al 142. Insular Bank of Asia and American Employees Union vs. Hon. Amado G. Inciong 143. The Chartered Bank Employees Association vs. Hon. Blas Ople 144. Obango vs. NLRC and Antique Electric Cooperative Inc. 145. Union of Filipro Employees vs.Benigno Vivar Jr NLRC and Nestle Phils Inc 146. Wellington Investment and Manufacturing Corporation vs.Cresenciano B.Trajano 147. Jose Rizal College vs. NLRC 148. Baltazar vs. San Miguel Brewery Inc 149. Davao Integrated Port Stevedoring Services vs. Abarquez 150. Kwok vs. Philippine Carpet Manufacturing Corp 141.

Article 97: Wages and Salary Songco et. al vs.NLRC et. al vs.NLRC 153. State Marine Corporation and Royal Line vs. Cebu Seamens Association Inc 154. Philippine Marine Corporation and Royal Line vs. Cebu Seamen’s Association 155. International School Alliance of Educators vs. Hon. Quimbinsing 151.

152. Ruga

Article 99-101: Minimum Wage 156. Atok

Big Wedge Mining Co. Inc vs. Atok Big Wedge Mutual Benefit Association 157. De Racho vs. Municipality of Iligan 158. Planas Commercial vs. NLRC, A. Ofialda et.al Article 100: Elimination or Diminution of Benefits 159. Davao

Integrated Ports Stevedoring Services vs. Abarquez Autobus Company vs.United Cebu Autobus Employees Assn 161. Nestle Philippines vs. NLRC 162. R. Tiangco and V. Tiangco vs. Hon. Vicente Leogardo, Jr. 163. Globe Mackay Cable vs. NLRC 164. Samahan ng Manggagawa sa Topform Manufacturing vs. NLRC 165. Pag-asa Steel Works vs.CA, et.al 166. Lexal Laboratories vs. Court of Industrial Relations et.al 167. National Sugar Refineries Corp. vs. NLRC 160. Cebu

168. American

Wire and Cable Daily Rated Employees Union vs .American Wire and Cable Co and the Court of Appeals 169. Traders Royal Bank vs. NLRC 170. National Federation of Sugar Workers vs. Ovejera 171. Universal Corn Products vs. NLRC 172. Philippine Airlines vs.NLRC and Airline Pilots Assn. of the Philippines 173. San Miguel Corporation vs. Inciong 174. Philippine Duplicators Inc vs. NLRC 175. Isalama Machine Works vs. NLRC et. al 176. Alliance of Government Workers et. al vs. Minister of Labor and Employment Article 101: Payment by Results 177. Tan vs. Lagrama 178. Lambo vs. NLRC 179. Makati Haberdashery vs. NLRC 180. Labor Congress of the Philippines vs. NLRC and Empire Food Products Article 102: Payment of Wages 181.Jimenez et. al. vs. NLRC and Juanatas Article 106: Labor-Only Contracting 182. Neri vs. NLRC, Far East Bank and Trust Co 183. Manila Water Co. vs. Pena 184. San Miguel Corp vs. Aballa 185. Philippine Bank of Communication vs. NLRC 186. Tabas et. al. vs. California Manufacturing Company 187. Mafinco Trading Corporation vs. Ople, NLRC et.al. 188. Insular Life Insurance Co. Ltd. Vs. NLRC 189. Rhone-Poulenc Agrochemicals Philippines, Inc vs. NLRC 190. Escario et. al. vs. NLRC Article 119: Prohibition Regarding Wages 191. Radio Communication of the Philippines Inc. vs. Secretary of Labor 192. Apodaca vs. NLRC 193. Metropolitan Bank and Trust Compnany Employee vs. NLRC 194. National Federation of Labor vs. NLRC 195. Manila Mandarin Employees Union vs. NLRC Article 120-127: Wage Studies, Wage Agreements and Wage Determination 196. Cagayan Sugar Milling Co. vs. Secretary of Labor et. al. 197. ECOP vs. NWPC Administration and Enforcement 198. Meycauayan College vs. Drilon 199. St. Joseph College vs. St. Joseph College Worker’s Association 200. COCOFED et.al vs. Hon. Cresenciano B. Trajano et.al. 201. Cebu Oxgygen and Acetelyn vs. Drilon 202. Odin Security Agency vs. Hon. Dionisio Dela Serna et.al 203. Urbanes etc. vs. Hon. Security of Labor Article 130-138: Employment of Women

Zialcita vs. PAL 205. Gualberto vs. Marinduques Industrial Mining Corporation Article 156-161: Health, Safety and Social Welfare Benefits 204.

206.

Philippine Global Communication Inc

207.

Article 166-184: Employees’ Compensation and State Insurance fund 208. Jose B. Sarmiento vs. Employees Compensation Commission et. al. 209. Raro vs. Employees Compensation Commission 210. Belarmino vs. Employees Compensation Commission 211. Hinoguin vs. Employees Compensation Commission 212. GSIS vs. CA AND F. Alegre 213. Velariano vs. ECC and GSIS 214. Iloilo Dock and Engineering Corporation vs. WCC et.al 215. Alano vs.ECG 216. Lazo vs.Employees Compensation Commission 217. Menez vs. ECC 218. Mabuhay Shipping Service vs. nlrc 219. Interiorent Maritime Enterprises vs. Pineda 220. NAESS Shipping Philippines vs. NLRC 221. YSMAEL Maritime Corporation vs. Avelino Article 191-193: Disability Benefits 222. Vicente vs. ECC 223. Abaya vs. ECC 224. Ornilno vs. ECC 225. Vicente vs. ECC 226. GSIS vs. CA Article 194 : Death Benefits 227. Canonizado vs. Almeda Lopez 228. Manzano vs ECC Article 195-205: 229. ECC vs. Sanico 230. Suanes vs. Workmen’s Compensation Commission Article 280: Regular and Casual Employment 231. Philippine

Federation of Credit Cooperatives, Inc v.NLRC 232. De Leon v. NLRC 233. Violeta v. NLRC 234. Romares v. NLRC 235. Phil Federation of Credit Cooperatives, Inc v. NLRC 236. Phil. Fruit and Vegetable Industries, Inc v.NLRC 237. De Leon v. NLRC 238.E. Ganzon, Inc v. NLRC 239. Hacienda Fatima v. National Federation of Sugarcane Workers 240. Magante v. NLRC 241. Tacloban Sagkahan Rice etc. v. NLRC

242. Ecal

v. NLRC 243. Kimberly etc. v. Drilon 244. Mercado v. NLRC 245. Datu and Co, Inc. v. NLRC 246. International Pharmaceutical, Inc. v. NLRC 247. Millares v. NLRC Article 281: Probationary Employment 248.Labor

Congress of the Phil. v. NLRC Copra Trades v.NLRC 250. San Miguel Corp v. NLRC 251. International Catholic Migration Commission v. NLRC 252. De la Cruz, Jr v.NLRC 253. Grand Motors Corp. v. MOLE 254. International Catholic Migration Commission v. NLRC 255. Phil. Federation of Credit Cooperatives , Inc v. NLRC 256. Escorpizo v.University of Baguio 257. Cebu Marine Beach Resort v. NLRC 258. Magcalas v. NLRC 259. Lao Construction v. NLRC 260. ALU-TUCP v.NLRC 261. Kiamco v. NLRC 262. Phil. Jai-Alai and Amusement Corp v. Clave 263. Sandoval Shipyards, Inc v. NLRC 264. Magante v. NLRC 265. Tucor Industries, Inc v. NLRC 266. Rada v. NLRC 267. Mamansag v. NLRC 268.Uy v. NLRC 269. Phil. Airlines Inc, v. NLRC 270. Villa v. NLRC 271. Phil. Fruits and Vegetables Industries, Inc. v. NLRC 272. Imbuido v. NLRC 273. Maraguinot v. NLRC 274. A.M. Oreta and Co.,Inc v. NLRC 275. Southern Cotabato v.NLRC 276. Purefoods Corp. v. NLRC 277. Aguilar Corp. v. NLRC 278. Tabas v. California Manufacturing Co. Inc. 279. Phil Geothermal Inc v. NLRC 280. Mercado v. NLRC 281. International Pharmaceutical, Inc. v .NLRC 282.Cebu Engineering and Development Co. v. NLRC 283.Highway Copra Traders v. NLRC 284.Brent School v. Zamora 285. Cielo v. NLRC 286.International Pharmaceuticals, Inc. v.NLRC 249. Highway

287. St.

Theresa’s School v. NLRC 288. Servidad v. NLRC 289.Purefoods Corp. v. NLRC 290. Phil. Tabacco etc v. NLRC 291. San Miguel Corp v. NLRC 292. Grand Motors Corp v. MOLE 293. Orient Express Placement Philippines v. NLRC 294. International Catholic Migration Commission v. NLRC 295. Bernardo v. NLRC 296. Escorpizo v. University of Baguio 297. A’ Prime Security Services Inc. v. NLRC 298.De La Cruz, Jr. v. NLRC 299. Mariwasa Manufacturing Inc. v. Leogardo 300. Phil. Federation of Credit Corporation, etc. v. NLRC 301. Escorpizo v. University of Baguio 302. St. Michael Academy v. NLRC Article 282: Termination by Employer 303.International

Catholic Migration Commission vs. NLRC Orient Express Placement Philippines vs. NLRC 305. Manila Trading and Supply Co, Inc. v. Zulueta 306. Makati Haberdashery, Inc. v. NLRC 307. Ocean East Agency Corp v. NLRC 308. Arboleda v. NLRC 309. Samson v. NLRC 310. PNCC v. NLRC 311. Golden Thread Knitting Industrial Inc. v. NLRC 312. Austria v. NLRC 313. Philippine Aeolus Automotive United Corp v. NLRC 314. Naguit, Jr. v. NLRC 315. Cebu Filveneer Corp v. NLRC 316. Westin Phil. Plaza Hotel v. NLRC 317. Tierra International Production Corp. v. NLRC 318. Legahi v. NLRC 319. Vitarich Corp v. NLRC 320.Rosario v. Victory Rice Mill 321. PNOC-EDC v. Abella 322. National Sugar refineries Corp. v. NLRC 323. Judy Philippines Inc. v. NLRC 324. PLDT v. NLRC 325. Tres Reyes v. Maxim’s Tea House 326. Philippine Aeolus Automotive United Corp. v. NLRC 327. Cebu Filveneer Corp v. NLRC 328.Citibank N.A. v. Gatchalian 329. RDS Trucking v. NLRC 330.Paguio Transport Corp v. NLRC 331. Jardine Davies, Inc. v NLRC 304.

332. Panday

v. NLRC 333. Farrol v. Court of Appeals 334. Sulpicio Lines, Inc. v.Gulde 335. Santos v. San Miguel Corp. 336. Greenhills Products, Inc. v. NLRC 337. Vitarich v. NLRC 338. Cathedral School of Technology v. NLRC 339. International Rice Research Institute v. NLRC 340. Oania v. NLRC 341. Lim v.NLRC 342. Escobin v.NLRC 343. Metro Transit Corp. Inc. v. NLRC 344. Leonardo v.NLRC and Fuerte v. Aquino 345. Hacienda Dapdap v. NLRC 346. Premiere Development Bank v. NLRC 347. Phil. Airlines, Inc. v. NLRC 348.CMP Federal Security Agency, Inc. v. NLRC 349. Mendoza vs. NLRC 350. Batongbacal v. Associated Bank 351. Manila Electric Co. Inc. v. NLRC 352. Brent School v. Zamora 353. Romares v. NLRC 354. Santos v. NLRC 355. Chua-Qua v. Clave 356. Aparente Sr. v. NLRC 357. Lacorte v. Inciong 358. Starlite etc. v. NLRC 359. Quiambao v. NLRC 360. San Miguel Corp v. NLRC 361. Westin Phil. Plaza Hotel v. NLRC 362. Phil. Wireless, Inc v. NLRC 363. Globe- Mackay Cable and Radio Corp. v. NLRC 364. Phil. Airlines v. NLRC 365. Kwikway Engineering Works v. NLRC 366. Wiltshire File Co., Inc. v. NLRC 367. Almodiel v. NLRC 368.Escareal v. NLRC 369. AG & P United Rank and File Assn v. NLRC 370. Caffco International Ltd v. Office MOLE 371. Sebuguero v. NLRC 372. Wiltshire File Co.., Inc. v. NLRC 373. Tierra International Construction Corp. v.NLRC 374. Guerrero v. NLRC 375. Tierra International Construction Corp. v. NLRC 376. Almodiel v. NLRC 377. Panlilio v. NLRC 378. Lopez Sugar Corporation v. Federation of Free Workers

379. Revidad

v. NLRC 380. Balbalec v. NLRC 381. San Miguel Jeepney Service v. NLRC 382.Lopez Sugar Corporation v. Federation of Free Workers 383. Revidad v. NLRC 384.Catatista v. NLRC 385. Central Azucarera de la Carlota v. NLRC 386.Somerville Stainless Steel Corp. v. NLRC 387. Bago-Medellin Sugar Can Planters Assn., Inc. v. NLRC Article 287: Retirement From Service Habana v. NLRC Manufacturing, Inc. v. NLRC 390. Metro Transit Organization, Inc. v. NLRC 391. Reyes v. CA 392. Wilt Hahn Enterprises v. Maghuyop 393. Cheniver Deco Print Technics Corporation v. NLRC 394. Admiral Realty Co., Inc. v. NLRC 395. Phil. Wireless Inc. v. NLRC 396. Pascua v. NLRC 397. Intertrod Maritime Inc. v. NLRC 398.Manila Broadcasting Co. v. NLRC 399. Valdez v. NLRC 388.

389.Azcor

MATERNITY CHILDREN’S HOSPITAL VS. SECRETARY OF LABOR G.R. NO. 78909 JUNE 30 1984 Facts: Petitioner is a semi-government hospital, managed by the Board of Directors of the Cagayan de Oro Women's Club and Puericulture Center, headed by Mrs. Antera Dorado, as holdover President. The hospital derives its finances from the club itself as well as from paying patients, averaging 130 per month. It is also partly subsidized by the Philippine Charity Sweepstakes Office and the Cagayan De Oro City government. Petitioner has forty-one (41) employees. Aside from salary and living allowances, the employees are given food, but the amount spent therefor, is deducted from their respective salaries (pp. 77-78, Rollo). On May 23, 1986, ten (10) employees of the petitioner employed in different capacities/positions filed a complaint with the Office of the Regional Director of Labor and Employment, Region X, for underpayment of their salaries and ECOLAS, which was docketed as ROX Case No. CW-71-86. The Regional Director issued and order based on the reports of the Labor Standard and Welfare Officers, directing payment of P723, 888.58 representing underpayment of wages and ECOLAs to all the petitioner’s employees. Petitioner appealed to the Minister of Labor and Employment which modified the decision as to the period for the payment ECOLAs only. A motion for reconsideration was filed by petitioner and was denied by the Secretary of Labor. Issue: Whether or not that the salaries of the petitioner including the ECOLAS included on the labor standards prescribed by law. Held: Labor standards refer to the minimum requirements prescribed by existing laws, rules, and regulations relating to wages, hours of work, cost of living allowance and other monetary and welfare benefits, including occupational, safety, and health standards (Section 7, Rule I, Rules on the Disposition of Labor Standards Cases in the Regional Office, dated September 16, 1987). CALALANG V. WILLIAMS 70 PHIL 726, GR NO. 47800 DECEMBER 2, 1940 FACTS: The National Traffic Commission resolved that animal-drawn vehicles be prohibited from passing along some major streets such a Rizal Ave. in Manila for a period of one year from the date of the opening of the Colgante Bridge to traffic. The Secretary of Public Works approved the resolution on August 10,1940. The

Mayor of Manila and the Acting Chief of Police of Manila have enforced the rules and regulation. As a consequence, all animal-drawn vehicles are not allowed to pass and pick up passengers in the places above mentioned to the detriment not only of their owners but of the riding public as well. ISSUE: Does the rule infringe upon the constitutional precept regarding the promotion of social justice? What is Social Justice? HELD: No. The regulation aims to promote safe transit and avoid obstructions on national roads in the interest and convenience of the public. Persons and property may be subject to all kinds of restraints and burdens in order to secure the general comfort, health, and prosperity of the State. To this fundamental aims of the government, the rights of the individual are subordinated. Social justice is “neither communism, nor despotism, nor atomism, nor anarchy,” but the humanization of laws and the equalization of social and economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated. Social justice means the promotion of the welfare of all the people, the adoption by the Government of measures calculated to insure economic stability of all the competent elements of society, through the maintenance of a proper economic and social equilibrium in the interrelations of the members of the community, constitutionally, through the adoption of measures legally justifiable, or extra-constitutionally, through the exercise of powers underlying the existence of all governments on the time-honored principles of Salus Populi est Suprema Lex.(Justice Laurel) PEOPLE VS. VERA REYES G..R. NO. L-45748 APRIL 5, 1939 IMPERIAL, J. Facts: Defendant was charged in the Court of First Instance of Manila by the assistant city fiscal with a violation of Act No. 2549, as amended by Acts Nos. 3085 and 3958. The information alleged that from September 9 to October 28, 1936, the accused, in his capacity as president and general manager of the Consolidated Mines, having engaged the services of Severa Velasco de Vera as stenographer, at an agreed salary of P35 a month willfully and illegally refused to pay the salary of said stenographer corresponding to the above-mentioned period of time, which was long due and payable, in spite of her repeated demands. After the hearing, the court sustained the demurrer, declaring unconstitutional the last part of section 1 of Act No. 2549 as last amended by Act No. 3958, which considers as an offense the facts alleged in the information, for the reason that it violates the constitutional prohibition against imprisonment for debt, and

dismissed the case, with costs de oficio. The fiscal appealed from said order. In the appeal, the Solicitor-General contends that the court erred in declaring Act No. 3958 unconstitutional, and in dismissing the cause. The last part of section 1 of Act No. 2549, as last amended by section 1 of Act No. 3958 considers as illegal the refusal of an employer to pay, when he can do so, the salaries of his employees or laborers on the fifteenth or last day of every month or on Saturday of every week, with only two days extension, and the nonpayment of the salary within the periods specified is considered as a violation of the law. The same Act exempts from criminal responsibility the employer who, having failed to pay the salary, should prove satisfactorily that it was impossible to make such payment. Issue: Whether the last part of section 1 of Act No. 2549 as last amended by Act No. 3958 is constitutional and valid. Held: The court held that this provision is null because it violates the provision of section 1 (12), Article III, of the Constitution, which provides that no person shall be imprisoned for debt. We do not believe that this constitutional provision has been correctly applied in this case. A close perusal of the last part of section 1 of Act No. 2549, as amended by section 1 of Act No. 3958, will show that its language refers only to the employer who, being able to make payment, shall abstain or refuse to do so, without justification and to the prejudice of the laborer or employee. An employer so circumstanced is not unlike a person who defrauds another, by refusing to pay his just debt. In both cases the deceit or fraud is the essential element constituting the offense. The first case is a violation of Act No. 3958, and the second is estafa punished by the Revised Penal Code. In either case the offender cannot certainly invoke the constitutional prohibition against imprisonment for debt. The Court of Appeal held that the last part of section 1 of Act No. 2549, as last amended by section 1 of Act No. 3958, is valid, and reversed the appealed order with instructions to the lower court to proceed with the trial of the criminal case until it is terminated, without special pronouncement as to costs in this instance. PEOPLE VS POMAR G.R. NO. L-22008 NOVEMBER 3, 1924 JOHNSON, J. FACTS Julio Pomar, manager and person-in-charge of a tobacco factory, employed Macaria Fajardo as cigar-maker. She was granted vacation leave beginning July 16, 1923 by reason of pregnancy. On October 26, 1923, a case was filed against defendant Pomar for failing to pay Fajardo her regular wages corresponding to 30 days before and 30 days after her delivery and confinement, in accordance with Act 3071. Defendant Pomar contended that his act does not constitute any offense because Act No. 3071 unconstitutional.

ISSUE WON Act 3071 is valid and constitutional HELD No. Act 3071 is unconstitutional. While it is contended that the Act is within the police power of the State, it cannot be exercised in contravention of the constitution. The right to enter into lawful contracts constitutes one of the liberties of the people of the State. If that right be struck down or arbitrarily interfered with, there is substantial imprisonment of the people under the Constitution. The right to enter into lawful contracts is as essential to the laborer as it is to the capitalist. A citizen cannot be compelled to give employment to another citizen nor can anyone be employed against his will. Liberty includes the right to labor but also to refuse to labor and consequently the right to labor or for labor and to terminate such contracts and to refuse to make such contracts. PHIL. ASSOCIATION OF SERVICE EXPORTERS INC VS DRILON G.R. NO. 81958 JUNE 30, 1988 SARMIENTO, J. FACTS: The Philippine Association of Service Exporters, Inc. (PASEI) challenges the Constitutional validity of Department Order No. 1, Series of 1988, of the Department of Labor and Employment, in the character of "GUIDELINES GOVERNING THE TEMPORARY SUSPENSION OF DEPLOYMENT OF FILIPINO DOMESTIC AND HOUSEHOLD WORKERS," in this petition for certiorari and prohibition. Specifically, the measure is assailed for "discrimination against males or females;" that it "does not apply to all Filipino workers but only to domestic helpers and females with similar skills;" and that it is violative of the right to travel. It is held likewise to be an invalid exercise of the lawmaking power, police power being legislative, and not executive, in character. In its supplement to the petition, PASEI invokes Section 3, of Article XIII, of the Constitution, providing for worker participation "in policy and decision-making processes affecting their rights and benefits as may be provided by law." Department Order No. 1, it is contended, was passed in the absence of prior consultations. It is claimed, finally, to be in violation of the Charter's nonimpairment clause, in addition to the "great and irreparable injury" that PASEI members face should the Order be further enforced. ISSUE: Whether or not the Department Order No. 1 in nature of the police power is valid under the Constitution? HELD: In the light of the foregoing, the petition must be dismissed.

As a general rule, official acts enjoy a presumed validity. In the absence of clear and convincing evidence to the contrary, the presumption logically stands. The petitioner has shown no satisfactory reason why the contested measure should be nullified. There is no question that Department Order No. 1 applies only to "female contract workers," but it does not thereby make an undue discrimination between the sexes. It is well-settled that "equality before the law" under the Constitution does not import a perfect Identity of rights among all men and women. It admits of classifications, provided that (1) such classifications rest on substantial distinctions; (2) they are germane to the purposes of the law; (3) they are not confined to existing conditions; and (4) they apply equally to all members of the same class. The Court is well aware of the unhappy plight that has befallen our female labor force abroad, especially domestic servants, amid exploitative working conditions marked by physical and personal abuse. As precisely the caretaker of Constitutional rights, the Court is called upon to protect victims of exploitation. In fulfilling that duty, the Court sustains the Government's efforts. The same, however, cannot be said of our male workers. In the first place, there is no evidence that, except perhaps for isolated instances, our men abroad have been afflicted with an identical predicament. Suffice it to state, then, that insofar as classifications are concerned, this Court is content that distinctions are borne by the evidence. Discrimination in this case is justified. There is likewise no doubt that such a classification is germane to the purpose behind the measure. Unquestionably, it is the avowed objective of Department Order No. 1 to "enhance the protection for Filipino female overseas workers" this Court has no quarrel that in the midst of the terrible mistreatment Filipina workers have suffered abroad, a ban on deployment will be for their own good and welfare. The Order does not narrowly apply to existing conditions. Rather, it is intended to apply indefinitely so long as those conditions exist. This is clear from the Order itself ("Pending review of the administrative and legal measures, in the Philippines and in the host countries . . ."), meaning to say that should the authorities arrive at a means impressed with a greater degree of permanency, the ban shall be lifted. It is incorrect to say that Department Order No. 1 prescribes a total ban on overseas deployment. From scattered provisions of the Order, it is evident that such a total ban has not been contemplated. The consequence the deployment ban has on the right to travel does not impair the right. The right to travel is subject, among other things, to the requirements of "public safety," "as may be provided by law. Neither is there merit in the contention that Department Order No. 1 constitutes an invalid exercise of legislative power. It is true that police power is the domain of the legislature, but it does not mean that such an authority may not be lawfully delegated. As we have mentioned, the Labor Code itself vests the Department of Labor and Employment with rule-making powers in the enforcement whereof.

The non-impairment clause of the Constitution, invoked by the petitioner, must yield to the loftier purposes targeted by the Government. Freedom of contract and enterprise, like all other freedoms, is not free from restrictions, more so in this jurisdiction, where laissez faire has never been fully accepted as a controlling economic way of life. This Court understands the grave implications the questioned Order has on the business of recruitment. The concern of the Government, however, is not necessarily to maintain profits of business firms. In the ordinary sequence of events, it is profits that suffer as a result of Government regulation. The interest of the State is to provide a decent living to its citizens. The Government has convinced the Court in this case that this is its intent. We do not find the impugned Order to be tainted with a grave abuse of discretion to warrant the extraordinary relief prayed for. ABELLA VS NLRC G.R. NO. 71813 JULY 20, 1987 PARAS, J. FACTS: On June 27, 1960 the petioner, Rosalina Perez Abella leased a farm land known as Hacienda Danao-Ramona, for a period of ten (10) years. She opted to extend the leased contract for another ten(10) years. During the existence of the lease, she employed the private respondents Ricardo Dionele, Sr.,and Romeo Quitco. Upon the expiration of her leasehold rights, petitioner dismissed private respondents and turned over the hacienda to the owners thereof on October 5, 1981, who continued the management, cultivation and operation of the farm. On November 20, 1981, private respondents filed a complaint against the petitioner at the Ministry of Labor and Employment, Bacolod City District Office, for overtime pay, illegal dismissal and reinstatement with backwages. After the parties had presented their respective evidence, Labor Arbiter Manuel M. Lucas, Jr., in a Decision dated July 16, 1982, ruled that the dismissal is warranted by the cessation of business, but granted the private respondents separation pay. Petitioner appealed, the National Labor Relations Commission, in a Resolution affirmed the decision and dismissed the appeal for lack of merit. Petitioner filed a Motion for Reconsideration, but the same was denied. Hence, the present petition. ISSUE: Whether or not private respondents are entitled to separation pay? HELD: The petition is devoid of merit. Article 284 of the Labor Code as amended by BP 130 is the law applicable in this case. The purpose of Article 284 as amended is

obvious-the protection of the workers whose employment is terminated because of the closure of establishment and reduction of personnel. Without said law, employees like private respondents in the case at bar will lose the benefits to which they are entitled for the thirty three years of service in the case of Dionele and fourteen years in the case of Quitco. Although they were absorbed by the new management of the hacienda, in the absence of any showing that the latter has assumed the responsibilities of the former employer, they will be considered as new employees and the years of service behind them would amount to nothing. It is well-settled that in the implementation and interpretation of the provisions of the Labor Codeand its implementing regulations, the workingman's welfare should be the primordial and paramount consideration. The instant petition is hereby dismissed and Decision of the Labor Arbiter and the resolution of the ministry of labor and employment are hereby affirmed. EURO-LINEA PHIL, INC. VS. NLRC G.R. NO. 78782 DECEMBER 1 , 1987 PARAS, J. Laborer’s Welfare: Liberal Approach Facts: Petitioner Euro-Linea Phil, Inc hired private respondent Pastoral as shipping expediter on a probationary basis for a period of six months. Prior to hiring by petitioner, Pastoral had been employed by Fitscher Manufacturing Corporation also as shipping expediter. On 4 February 1984, Pastoral received a memorandum terminating his probationary employment in view of his failure “to meet the performance standards set by the company”. Pastoral filed a complaint for illegal dismissal against petitioner. On 19 July 1985, the Labor Arbiter found petitioner guilty of illegal dismissal. Petitioner appealed the decision to the NLRC on 5 August 1985 but the appeal was dismissed. Hence the petition for review seeking to reverse and set aside the resolution of public respondent NLRC, affirming the decision of the Labor Arbiter, which ordered the reinstatement of complainant with six months backwages. Issue: Whether or not the National Labor Relations Commission acted with grave abuse of discretion amounting to excess of jurisdiction in ruling against the dismissal of the respondent, a temporary or probationary employee, by his employer. Ruling:

Although a probationary or temporary employee has a limited tenure, he still enjoys the constitutional protection of security of tenure. Furthermore, what makes the dismissal highly suspicious is the fact that while petitioner claims that respondent was inefficient, it retained his services until the last remaining two weeks of the six months probationary employment. No less important is the fact that private respondent had been a shipping expediter for more than one and a half years before he was absorbed by petitioner. It therefore appears that the dismissal in question is without sufficient justification. It must be emphasized that the prerogative of management to dismiss or lay-off an employee must be done without abuse of discretion, for what is at stake is not only petitioner's position but also his means of livelihood. The right of an employer to freely select or discharge his employees is subject to regulation by the State, basically in the exercise of its paramount police power. Petition dismissed for lack of merit and decision by the NLRC is affirmed. MANILA ELECTRIC COMPANY VS. NLRC G.R. NO. 78763 JULY 12,1989 MEDIALDEA, J. FACTS: Apolinario Signo was employed in Meralco as supervisor-leadman since Jan 1963. In 1981, he supervised the installation of electricity in de Lara’s house in Antipolo. De Lara’s house was not yet within the required 30-meter distance from the Meralco facility hence he is not yet within the service scope of Meralco. As a workaround, Signo had it be declared that a certain sarisari store nearer the facility be declared as de Lara’s so as to facilitate the installation. Evertything would have been smooth thereafter but due to fault of the Power Sales Division of Meralco, de Lara was not billed for a year. Investigation was conducted and Meralco found out the irregularity in Signo’s work on de Lara’s electricity installation. Signo was dismissed on May 18, 1983. Signo filed a case for illegal dismissal and for backwages. The Lanor Arbiter ruled that though there is a breach of trust in the actuations of Signo dismissal is a harsh penalty as Signo has been employed for more than 20 years by Meralco and has been commended twice before for honesty. The NLRC affirmed the Labor Arbiter. Meralco appealed. ISSUE: Whether or not there has been due process in the dismissal of Signo. HELD: The SC sustained the decision of the NLRC. Well-established is the principle that findings of administrative agencies which have acquired expertise because their jurisdiction is confined to specific matters are generally accorded not only respect but even finality. Judicial review by this Court on labor cases does not go so far as to evaluate the sufficiency of the evidence upon which the

proper labor officer or office based his or its determination but is limited to issues of jurisdiction or grave abuse of discretion. Notwithstanding the existence of a valid cause for dismissal, such as breach of trust by an employee, nevertheless, dismissal should not be imposed, as it is too severe a penalty if the latter has been employed for a considerable length of time in the service of his employer. Reinstatement of respondent Signo is proper in the instant case, but without the award of backwages, considering the good faith of the employer in dismissing the respondent. SOSITO VS. AGUINALDO DEVELOPMENT CORPORATION G.R. NO. L-48926 DECEMBER 14, 1987 CRUZ, J. Facts: Petitioner Manuel Sosito was employed in 1964 by the private respondent, a logging company, and was in charge of logging importation, with a monthly salary of P675.00, when he went on indefinite leave with the consent of the company on January 16, 1976. On July 20, 1976, the private respondent, through its president, announced a retrenchment program and offered separation pay to employees in the active service as of June 30, 1976, who would tender their resignations not later than July 31, 1976. The petitioner decided to accept this offer and so submitted his resignation on July 29, 1976, "to avail himself of the gratuity benefits" promised. However, his resignation was not acted upon and he was never given the separation pay he expected. The petitioner complained to the Department of Labor, where he was sustained by the labor arbiter. The company was ordered to pay Sosito the sum of P 4,387.50, representing his salary for six and a half months. On appeal to the National Labor Relations Commission, this decision was reversed and it was held that the petitioner was not covered by the retrenchment program. Issue: whether or not the petitioner is entitled to separation pay under the retrenchment program of the private respondent. Held: The petitioner is not one of those entitled for separation pay under the retrenchment program. It is clear from the memorandum that the offer of separation pay was extended only to those who were in the active service of the company as of June 30, 1976. It is equally clear that the petitioner was not eligible for the promised gratuity as he was not actually working with the company as of the said date. Being on indefinite leave, he was not in the active service of the private respondent although, if one were to be technical, he was still in its employ. Even so, during the period of indefinite leave, he was not entitled to receive any salary or to enjoy any other benefits available to those in the active service.

COLGATE PALMOLIVE PHILIPPINES VS. OPLE G.R. NO. 73681 JUNE 30, 1988 PARAS, J. Facts: On March 1, 1985, the respondent Union filed a Notice of Strike with the Bureau of Labor Relations (BLR) on ground of unfair labor practice consisting of alleged refusal to bargain, dismissal of union officers/members; and coercing employees to retract their membership with the union and restraining non-union members from joining the union. MOLE declared that the union is not authorized.Union reiterated the issue in its Notice to Strike, alleging that it was duly registered with the Bureau of Labor Relations under Registry No. 10312-LC with a total membership of 87 regular salesmen (nationwide) out of 117 regular salesmen presently employed by the company as of November 30, 1985 and that since the registration of the Union up to the present, more than 2/3 of the total salesmen employed are already members of the Union, leaving no doubt that the true sentiment of the salesmen was to form and organize the Colgate-Palmolive Salesmen Union. The Minister directly certified the respondent Union as the collective bargaining agent for the sales force in petitioner company and ordered the reinstatement of the three salesmen to the company on the ground that the employees were first offenders. Issue: Whether the Minister of Labor correctly certified the respondent as the petitioner’s union. Held: No. Petitioner concedes that respondent Minister has the power to decide a labor dispute in a case assumed by him under Art. 264 (g) of the Labor Code but this power was exceeded when he certified respondent Union as the exclusive bargaining agent of the company's salesmen since this is not a representation proceeding as described under the Labor Code. Moreover the Union did not pray for certification but merely for a finding of unfair labor practice imputed to petitioner-company. The procedure for a representation case is outlined in Arts. 257-260 of the Labor Code, in relation to the provisions on cancellation of a Union registration under Arts.239-240 thereof, the main purpose of which is to aid in ascertaining majority representation. Contrary to the respondent Minister's observation, the holding of a certification election at the proper time is not necessarily a mere formality as there was a compelling legal reason not to directly and unilaterally

certify a union whose legitimacy is precisely the object of litigation in a pending cancellation case filed by certain "concerned salesmen," who also claim majority status. Even in a case where a union has filed a petition for certification elections, the mere fact that no opposition is made does not warrant a direct certification. More so as in the case at bar, when the records of the suit show that the required proof was not presented in an appropriate proceeding and that the basis of the direct certification was the Union's mere allegation in its position paper that it has 87 out of 117 regular salesmen. In other words, respondent Minister merely relied on the self-serving assertion of the respondent Union that it enjoyed the support of the majority of the salesmen, without subjecting such assertion to the test of competing claims. The order of the respondent Minister to reinstate the employees despite a clear finding of guilt on their part is not in conformity with law. Reinstatement is simply incompatible with a finding of guilt. Where the totality of the evidence was sufficient to warrant the dismissal of the employees the law warrants their dismissal without making any distinction between a first offender and a habitual delinquent. Under the law, respondent Minister is duly mandated to equally protect and respect not only the labor or workers' side but also the management and/or employers' side. The law, in protecting the rights of the laborer, authorizes neither oppression nor self-destruction of the employer. To order the reinstatement of the erring would in effect encourage unequal protection of the laws as a managerial employee of petitioner company involved in the same incident was already dismissed and was not ordered to be reinstated. MENDOZA VS. RURAL BANK OF LUCBAN G.R. NO. 155421 JULY 7, 2004 PANGANIBAN, J. Facts: On April 25, 1999, the Board of Directors of the Rural Bank of Lucban, Inc., issued Board Resolution Nos. 99-52 and 99-53, “that in line with the policy of the bank to familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system[,] all officers and employees are subject to reshuffle of assignments. Moreover, this resolution does not preclude the transfer of assignment of bank officers and employees from the branch office to the head office and vice-versa." Petitioner filed a Complaint before Arbitration Branch No. IV of the National Labor Relations Commission (NLRC). The Complaint -- for illegal dismissal, underpayment, separation pay and damages. Petitioner argues that he was compelled to file an action for constructive dismissal, because he had been demoted from appraiser to clerk and not given any work to do, while his table had been placed near the toilet and eventually removed. He adds that the reshuffling of employees was done in bad faith, because it was

designed primarily to force him to resign.After the NLRC denied his Motion for Reconsideration, petitioner brought before the CA a Petition for Certiorari assailing the foregoing Resolution. The Court of appeals Find that no grave abuse of discretion could be attributed to the NLRC. Hence, this Petition. Issue: Whether the petitioner was constructively dismissed from his employment? Held: The Petition has no merit. Constructive dismissal is defined as an involuntary resignation resorted to when continued employment is rendered impossible, unreasonable or unlikely; when there is a demotion in rank or a diminution of pay; or when a clear discrimination, insensibility or disdain by an employer becomes unbearable to the employee. Jurisprudence recognizes the exercise of management prerogatives. For this reason, courts often decline to interfere in legitimate business decisions of employers. Indeed, labor laws discourage interference in employers' judgments concerning the conduct of their business. The law must protect not only the welfare of employees, but also the right of employers. The law protects both the welfare of employees and the prerogatives of management. Courts will not interfere with business judgments of employers, provided they do not violate the law, collective bargaining agreements, and general principles of fair play and justice. The transfer of personnel from one area of operation to another is inherently a managerial prerogative that shall be upheld if exercised in good faith -- for the purpose of advancing business interests, not of defeating or circumventing the rights of employees. GELMART INDUSTRIES PHILS., INC. VS. NLRC G.R. NO. 85668 AUGUST 10, 1989 GANCAYCO, J. Facts: Private respondent Felix Francis started working as an auto-mechanic for petitioner Gelmart Industries Phils., Inc. (hereinafter referred to as GELMART) sometime in 1971 As such, his work consisted of the repair of engines and under chassis, as well as trouble shooting and overhauling of company vehicles. He is likewise entrusted with some tools and spare parts in furtherance of the work assigned to him. On April 11, 1987, private respondent was caught by the security guards taking out of GELMART's premises one (1) plastic container filled with about 16 ounces

of "used' motor oil, without the necessary gate pass to cover the same as required under GELMART's rules and regulations. By reason thereof, petitioner, on April 13, 1987, was placed under preventive suspension pending investigation for violation of company rules and regulations. Under the said rules, theft and/or pilferage of company property merits an outright termination from employment. After due investigation, or on May 20, 1987, private respondent was found guilty of theft of company property. As a consequence, his services were severed. Thereafter, private respondent filed a complaint for illegal dismissal before the NLRC. In a decision dated February 26, 1988, Labor Arbiter Ceferina J. Diosana ruled that private respondent was illegally dismissed and, accordingly, ordered the latter's reinstatement with full backwages from April 13, 1987 up to the time of actual reinstatement. Issue: Whether or not the National Labor Relations Commission (NLRC) committed a grave abuse of discretion amounting to lack or excess of jurisdiction in ordering the reinstatement of private respondent to his former position with payment of backwages equivalent to six (6) months. Held: Consistent with the policy of the State to bridge the gap between the underprivileged workingmen and the more affluent employers, the NLRC rightfully tilted the balance in favor of the workingmen — and this was done without being blind to the concomitant right of the employer to the protection of his property. Thus, without being too harsh to the employer, on the one hand, and naively liberal to labor, on the other, the NLRC correctly pointed out that private respondent cannot totally escape liability for what is patently a violation of company rules and regulations. Considering that private respondent herein has no previous derogatory record in his fifteen (15) years of service with petitioner GELMART the value of the property pilfered (16 ounces of used motor oil) is very minimal, plus the fact that petitioner failed to reasonably establish that non-dismissal of private respondent would work undue prejudice to the viability of their operation or is patently inimical to the company's interest, it is more in consonance with the policy LAGATIC VS. NLRC G.R. NO. 121004 JANUARY 28, 1998 ROMERO, J.: FACTS: Cityland employed Petitioner, Romeo Lagatic, as a marketing specialist in May 1986. He was tasked with with soliciting sales for the company as well as accepting call-ins, referrals, and making client calls and cold calls. It was believed by Cityland that cold calls is an effective and cost-efficient method of finding

clients and required all marketing specialist to make the same but requires submissions of daily progress reports on cold calls for assessment and to determine its results. Petitioner was suspended for 3 days on November 1992, for his failure to submit cold call reports on different days of September and October 1992 despite a written reprimand for infractions of the same committed a year earlier and a warning that if he continues to not comply with the requirement it will result in termination. Petitioner failed again to submit cold call reports for 5 days of February 1993 despite the aforesaid suspension and warning. He was then verbally reminded to submit the reports and was given an extension up to Feb. 17, 1993. Petitioner still did not comply and instead wrote a note with the words, “TO HELL WITH COLD CALLS! WHO CARES?”, and exhibiting it to his co-employees. He left the note lying on top of his desk where everyone could see it to worsen the matter. On Feb. 23, 1993, a memorandum was received by the Petitioner requiring him to explain why Cityland should not implement their previous warning for his failure to submit cold call reports, as well as, for the written statement he exhibited. The petitioner replied through a letter that his not complying with the submission of cold call reports must not be deemed as gross insubordination and he denied having knowledge about the damaging statement that was being accused of him. Cityland found the petitioner of guilty of gross insubordination and then served upon him a notice of dismissal on Feb. 26, 1993. The petitioner then felt wronged by the dismissal and filed a complaint against Cityland for illegal dismissal, illegal deduction, underpayment, overtime and rest day pay, damages and attorney’s fees. The labor arbiter dismissed it but it was appealed and affirmed by the NLRC. ISSUE: Whether or not the respondent NLRC gravely abused its discretion in not finding the petitioner illegally dismissed. HELD: The petition lacks merit. To constitute a valid dismissal from employment, two requisites must be met, namely: (1) the employee must be afforded due process, and (2) the dismissal must be for a valid cause. Petitioner loses sight of the fact that except as provided for, or limited by, special laws, an employer is free to regulate, according to his discretion and judgment, all aspects of employment. Employers may, thus, make reasonable rules and regulations for the government of their employees, and when employees, with knowledge of an established rule, enter the service, the rule becomes a part of the contract of employment. It is also generally recognized that company policies and regulations, unless shown to be grossly oppressive or contrary to law, are generally valid and binding on the parties and must be complied with.

Corollarily, an employee may be validly dismissed for violation of a reasonable company rule or regulation adopted for the conduct of the company business. An employer cannot rationally be expected to retain the employment of a person whose x x x lack of regard for his employers rules x x x has so plainly and completely been bared. Petitioners continued infraction of company policy requiring cold call reports, as evidenced by the 28 instances of non-submission of aforesaid reports, justifies his dismissal. He cannot be allowed to arrogate unto himself the privilege of setting company policy on the effectivity of solicitation methods. To do so would be to sanction oppression and the self-destruction of the employer. More than that, his written statement shows his open defiance and disobedience to lawful rules and regulations of the company. Likewise, said company policy of requiring cold calls and the concomitant reports thereon is clearly reasonable and lawful, sufficiently known to petitioner, and in connection with the duties which he had been engaged to discharge. There is, thus, just cause for his dismissal. CHINA BANKING CORPORATION V. BORROMEO G.R. NO. 156515 OCTOBER 19, 2004 CALLEJO, SR., J. Facts: Respondent Mariano Borromeo was Assistant Vice-President of the Branch Banking Group of China Banking Corporation for the Mindanao Area. Without authority from the Executive Committee or Board of Directors of the bank, he approved several DAUD/BP (Drawn Against Uncollected Deposits/Bills Purhcased) accommodations amounting to P2,441,375 in favour of Joel Maniwan. Such checks, which are not sufficiently funded by cash, are generally not honoured by banks. This came to the knowledge of the bank authorities. A memorandum was issued to the Mariano seeking clarification relative15 to the matter. The respondent accepted full responsibility for committing an error in judgment and abuse of discretion. Mariano resigned from the Bank and apologized “for all the trouble I have caused because of the Maniwan case.” The respondent, however, vehemently denied benefitting therefrom. His acts having constituted violation of the Bank’s Code of Ethics, the respondent was directed to restitute the amount of P1,507,736.79 representing 90% of the total loss of P1,675,263.10 incurred by the Bank. However, in view of his resignation and considering the years of service in the Bank, the management earmarked only P836,637.08 from the respondent’s total separation benefits or pay. The said amount would be released upon recovery of the sums demanded from Maniwan in a civil case filed against him by the bank with the RTC in Cagayan de Oro City. The respondent made a demand on the bank for the payment of his separation pay and other benefits, but the bank maintained its position to withhold the sum

of P836,637.08. Thus, Mariano filed with the NLRC a complaint for payment of separation pay, mid-year bonus, profit share and damages against the bank. The Labor Arbiter ruled in favour of the bank. Respondent appealed to the NLRC but it affirmed in toto the findings of the Labor Arbiter. The CA, however, alleging that respondent was denied his right to due process, set aside the NLRC decision and ordered that the records of the case be remanded to the Labor Arbiter for further hearings on the factual issues involved. The bank filed a motion for reconsidered but denied the same. Hence, this petition. Issue: Whether or not the bank has the prerogative/right to impose on the respondent what it considered the appropriate penalty under the circumstances pursuant to its company rules and regulations. Held: The petition is meritorious.The bank was left with no other course but to impose the ancillary penalty of restitution. It was certainly within the bank’s prerogative to impose on the respondent what it considered the appropriate penalty under the circumstances pursuant to its company rules and regulations. The petitioner’s bank business is essentially imbued with public interest and owes great fidelity to the public it deals with. It is expected to exercise the highest degree of diligence in the selection and supervision of their employees. As a corollary, and like all other business enterprises, its prerogative to discipline its employees and to impose appropriate penalties on erring workers pursuant to company rules and regulations must be respected. The law, in protecting the rights of labor, authorized neither oppression nor self-destruction of an employer company which itself is possessed of rights that must be entitled to recognition and respect. Significantly, the respondent is not wholly deprived of his separation benefits. As the Labor Arbiter stressed in his decision, “the separation benefits due the complainant were merely withheld. Even the petitioner bank itself gives “the assurance that as soon as the bank has satisfied a judgment in the civil case, the earmarked portion of his benefits will be released without delay. WHEREFORE, the petition is granted. The decision of the CA is reversed and set aside. The Resolution of the NLRC is reinstated. ASSOCIATED WATCHMEN AND SECURITY UNION VS. LANTING G.R. NO. L – 14120 FEBRUARY 29, 1960

LABRADOR, J. Facts: Petitioner and its members declared a strike against respondent-company and other shipping firms. Subsequently, through the Court of Industrial Relations (CIR), the strikers expressed their willingness to return to work. However, the respondent-company stated that it would re-instate the said strikers if the petitioner would file a bond of Php 5, 000.00. Petitioner did not comply with said condition, thus, their members were not re-instated by the respondent-company. Eventually, petitioners filed a case against the respondent-company for allegedly committing unfair labor practice. The trial court decided in favor of the petitioners on the basis that the bond hinders the re-employment of the union members. The CIR, however, reversed the trial court’s decision. Issue: Is the respondent company guilty of unfair labor practice when it asked the petitioner to file a bond of Php 5, 000.00 in order for the latter’s members to be re-instated? Ruling: No, the Supreme Court finds no merit in the petitioner’s contention that the respondent-company committed unfair labor practice. As embodied in the Labor Code, the employers are vested with certain rights that they may exercise so as to protect their interests and capital. In the present case, the Court ruled in favor of the respondents due to the following reasons: The law gives respondent company the right to protect its interest, especially, when in this case, the union members abandoned their posts without notice when they joined the strike. Consequently, the acts of the union members exposed the company to possible dangers such as theft and pilferage. It was obvious that the bond asked by the respondent company was not demanded from the petitioner. The agreement between the two parties was plain and simple – re-instatement shall be applied to those agencies who are willing to file the bond. There is no existing contract between the two parties and that the union members were not direct employees of the respondent company. Said union members were merely casual guards of the said company. Therefore, the Court affirms the decision of the CIR and costs are imposed against the petitioner. PAMPANGA BUS COMPANY, INC., VS. PAMBUSCO EMPLOYEES' UNION, INC. G.R. NO. 46739 SEPTEMBER 23, 1939

FACTS: On May 31, 1939, the Court of Industrial Relations issued an order, directing the petitioner herein, Pampanga Bus Company, Inc., to recruit from the respondent, Pambusco Employees'Union, Inc., new employees or laborers it may need to replace members of the union who may be dismissed from the service of the company, with the proviso that, if the union fails to provide employees possessing the necessary qualifications, the company may employ any other persons it may desire. This order, in substance and in effect, compels the company, against its will, to employ preferentially, in its service, the members of the union. Issue: Whether or not the said order issued by the CIR valid and not violative of the right of the employer to select employees. Held: We hold that the court has no authority to issue such compulsory order. The general right to make a contract in relation to one's business is an essential part of the liberty of the citizens protected by the due-process clause of the Constitution. The right of the laborer to sell his labor to such person as he may choose is, in its essence, the same as the right of an employer to purchase labor from any person whom it chooses. The employer and the employee have thus an equality of right guaranteed by the Constitution. Section of Commonwealth Act No. 213 confers upon labor organizations the right "to collective bargaining with employers for the purpose of seeking better working and living conditions, fair wages, and shorter working hours for laborers, and, in general, to promote the material, social and moral well-being of their members." This provision in granting to labor unions merely the right of collective bargaining, impliedly recognizes the employer's liberty to enter or not into collective agreements with them. Indeed, we know of no provision of the law compelling such agreements. Such a fundamental curtailment of freedom, if ever intended by law upon grounds of public policy, should be effected in a manner that is beyond all possibility of doubt. The supreme mandates of the Constitution should not be loosely brushed aside. As held by the Supreme Court of the United States in Hitchman Coal & Co. vs. Mitchell (245 U. S., 229; 62Law. ed., 260, 276): GREGORIO ARANETA EMPLOYEES UNION VS. ROLDAN G.R. NO. L-6846 JULY 20, 1955 FACTS A petition for certiorari to review the Resolution of the Court of Industrial Relations dated March 31, 1953. The Agricultural Division of the Gregorio Araneta, Inc., was established in 1947 with a capital of P200,000. The total investment in that Division in 1953 was about P3,000,000. To reduce this overcapitalization, the Board of Directors felt

that it was necessary either to invite fresh capital from outside or to adopt a retrenchment policy. When Heacock and Company refused the invitation to invest in the enterprise, the Board took the alternative of retrenchment. The Board decided not to import as much merchandise as usual. It also reduced credits. All these plans required a reduction in the volume of business necessitating likewise a reduction of personnel and caused the laying off of 17 employees. The selection of those to be laid off was made by a technical man and approved by the Board. These employees were given one month separation pay, except Nicolas Gonzalez who refused to receive it. The reorganization of the Agricultural Division was adopted by unanimous resolution of the Board of Directors as a consequence of the retrenchment policy. This was adopted even before the petitioner, "Gregorio Araneta Employees' Union", was organized and; consequently, it was never directed against the union. Judge Bautista adds: ". . . Considering this fact, and taking into account all the circumstances of this case, especially the actual reduction of business of said Division, the court fails to find sufficient justification for altering the action of the Board of Directors regarding those employees, who received their severance pay". Judge Bautista, however, believed that Gonzales should not have been separated because his work was shifted to another employee by the name of Augusto Achacoso, who was thus overburdened. Both parties filed their respective motions for reconsideration with the court en banc. The latter modified the decision of Associate Judge Bautista in its resolution of March 31, 1953, prepared by the Presiding Judge Arsenio C. Roldan and concurred in by Associate Judges Modesto Castillo and Juan L. Lantin. The modification consists only in holding that the laying off of Gonzalez was also legal. Judge Bautista dissented with regard to the separation of Gonzalez, giving the same reasons he gave in his original opinion. ISSUE: Whether or not the company engaged in unfair labor practice by adopting a policy of retrenchment aimed at the Union or any of its members. HELD: We find no reason for disturbing the decision of the Court of Industrial Relations, en banc. The laying off of the 17 employees was due to the retrenchment policy which the Company had to adopt in order to reduce the overcapitalization and minimize expenses. The volume of business was considerably reduced. It should be noted that the retrenchment policy was adopted before even the organization of the petitioning union. It was not, therefore, aimed at the Union or any of its members for union or labor activities. It was not an unfair labor practice. In view of the foregoing, the petition is denied, without pronouncement as to costs. It is so ordered.

PHILIPPINE STEEL METAL WORKERS’ UNION V. CIR G.R. NO. L-2028 APRIL 28, 1949 REYES, J. Facts: This is a petition for certiorari to review an order of the Court of Industrial Relations on the ground that the same was rendered in excess of jurisdiction and with grave abuse of discretion. On March 1, 1985, the respondent Union filed a Notice of Strike with the Bureau of Labor Relations (BLR) on ground of unfair labor practice consisting of alleged refusal to bargain, dismissal of union officers/members; and coercing employees to retract their membership with the union and restraining non-union members from joining the union. The said order was issued of said court involving an industrial dispute between the respondent company (a corporation engaged in the manufacture of tin plates, aluminum sheets, etc.) and its laborers some of whom belong to the Philippine Sheet Metal Workers' Union (CLO) and some to the Liberal Labor Union. The dispute was over certain demands made upon the company by the laborers, one of the demands, being for the recall of eleven workers who had been laid off. Temporarily taken back on certain conditions pending final determination of the controversy, these eleven workers were in the end ordered retained in the decision handed down by the court on February 19, 1947. The petitioner tried to prove that the 11 laborers were laid off by the respondent company due to their union activities. On February 10, 1947, that is, nine days before the decision came down, filed a motion in the case, asking for authority to lay off at least 15 workers in its can department on the ground that the installation and operation of nine new laborsaving machines in said department had rendered the services of the said workers unnecessary. Issue: W/N the firing of the laborers due to their union activities is valid? Ruling: Yes. The right to reduce personnel should, of course, not be abused. It should not be made a pretext for easing out laborers on account of their union activities. But neither should it be denied when it is shows that they are not discharging their

duties in a manner consistent with good discipline and the efficient operation of an industrial enterprise. The petitioner contends that the order complained of was made with grave abuse of discretion and in excess of jurisdiction in that it is contrary to the pronouncement made by the lower court in its decision in the main case where it disapproved of the dismissal of eleven workers "with whom the management is displeased due to their union activities." It appears, however, that the pronouncement was made upon a distinct set of facts, which are different from those found by the court in connection with the present incident, and that very decision, in ordering the reinstatement of the eleven laborers, qualifies the order by saying that those laborers are to be retained only "until the occurrence of facts that may give rise to a just cause of their laying off or dismissal, or there is evidence of sufficient weight to convince the Court that their conduct is not satisfactory." After a careful review of the record, we find that the Court of Industrial Relations has neither exceeded its jurisdiction nor committed grave abuse of discretion in rendering the order complained of. The petition for certiorari is, therefore, denied, but without costs against the petitioner for the reasons stated in its motion to litigate as pauper.

TIONG KING VS. COURT OF INDUSTRIAL RELATIONS G.R. NO. L-3587 DECEMBER 21, 1951 PARAS, J. FACTS: Gaw Pun So owned and operated a tailor shop known as the Army Shirt Factory, located in his own house at Nos. 231-245 Soler Street, Manila. In January, 1948, he had a labor dispute with his personnel and, pending the case in the Court of Industrial Relations, Gaw Pun So, irked and worried by the incidents of litigation, thought of dissolving the business and selling the sewing machines. Tiong King offered to take over the business by leasing the place and the sewing machines. The transfer was put in writing. Tiong King continued the Army Shirt Factory from the month of February with the same employees had by Gaw Pun So. This transfer was known to the personnel, so much so that the latter, as petitioner in the pending dispute in the Court of Industrial Relations, prayed that Tiong King be included as a respondent. In due time, the National Tailors Association entered that all cases were terminated against the respondents. This agreement was duly approved by the Court of Industrial Relations. On April 27, 1948, Tiong King filed a petition in the Court of Industrial Relations Case No. 117-V-3,

alleging that since he operated his shop in February, 1948, he had continually suffered losses; that as there remained only very little of the capital originally invested, and that he was definitely closing the shop on May 30, 1948. Tiong King accordingly prayed that he be allowed to close his tailor shop and business from six o'clock in the afternoon of May 29, 1948. On May 29, 1948, Presiding Judge Arsenio C. Roldan of the Court of Industrial Relations issued an order enjoining Tiong King not to close his factory and not to dismiss, suspend or lay off any laborer or employee without previous authority of said court. Upon petitioner for reconsideration filed by counsel for Tiong King, the Court of Industrial Relations promulgated a resolution dated May 27, 1949, allowing Tiong King to close his business and shop, subject to the condition that, upon reopening the same, his former personnel would be taken back. Upon motion for reconsideration filed by counsel for the National Tailor's Association, the Court of Industrial Relations, promulgated a resolution dated October 31, 1949, reaffirming their stand on there solution of the Court of Industrial Relations under date of July 1, 1949.The present appeal by certiorari was taken by Tiong King against the last resolution of the Court of Industrial Relations. ISSUE: Whether or not he was the owner or operator thereof and had the right to file the petition in the Court of Industrial Relations to close the tailor’s shop. HELD: Upon this point, it is only sufficient to recall that the National Tailors Association entered into a stipulation with Tiong King alone whereby they agreed that all cases against the former owners of the business were terminated. That Tiong King was conceded to be the owner and operator of the army shirt factory at the time his petition to close it was filed, is conclusively borne out by the fact that Presiding Judge Roldan in his decision of January 13, 1949, ordered Tiong King, and not Gaw Pun So, to pay the salaries and wages of the personnel. It is contended, however, that "If at all the court has approved of the agreement between the National Tailors' Association and Mr. Tiong King it was because — 'this arrangement is a very good solution to the present conflict as it is advantageous not only to the union but also the management, and,is in consonance with the contract entered into between the management and the new workers." This contention is followed with the remark that the approval of said agreement did not include a finding that Tiong King was either the owner or the lessee of the Army Shirt Factory. We are unable to agree. In entering into the agreement with the National Tailors Association, Tiong King acted in his own behalf, regardless of the former owners of the business. Indeed, it was covenanted that all the cases against the latter were deemed terminated. Considerations of fair play and justice demand that Tiong King be given the full legal effect of said agreement which before the sanction of the Court of Industrial Relations. There being no question that Tiong King's capital invested in the Army Shirt Factory was almost exhausted at the time of the filing of his petition to close it, said petition must necessity be granted. It is admitted by all the Judges of the Court of Industrial Relations that an employer may close his business, provided

the same is done in good faith and is due beyond his control. To rule otherwise, would be oppressive and inhuman. The court reversed the resolution of the Court of Industrial Relations dated October 31, 1949, and affirmed the resolution of said court dated May 27, 1949. RIZAL EMPIRE INSURANCE GROUP V NLRC G.R. NO. 73140 MAY 29, 1987 PARAS, J. Facts: In August, 1977, herein private respondent Rogelio R. Coria was hired by herein petitioner Rizal Empire Insurance Group as a casual employee with a salary of P10.00 a day. On January 1, 1978, he was made a regular employee, having been appointed as clerk-typist, with a monthly salary of P300.00. Being a permanent employee, he was furnished a copy of petitioner company's "General Information, Office Behavior and Other Rules and Regulations." In the same year, without change in his position-designation, he was transferred to the Claims Department and his salary was increased to P450.00 a month. In 1980, he was transferred to the Underwriting Department and his salary was increased to P580.00 a month plus cost of living allowance, until he was transferred to the Fire Department as filing clerk. In July, 1983, he was made an inspector of the Fire Division with a monthly salary of P685.00 plus allowances and other benefits. On October 15, 1983, private respondent Rogelio R. Coria was dismissed from work, allegedly, on the grounds of tardiness and unexcused absences. Accordingly, he filed a complaint with the Ministry of Labor and Employment (MOLE), and in a Decision dated March 14, 1985 (Record, pp. 80-87), Labor Arbiter Teodorico L. Ruiz reinstated him to his position with back wages. Petitioner filed an appeal with the National labor Relations Commission (NLRC) but, in a Resolution dated November 15, 1985 (Ibid, pp. 31-32), the appeal was dismissed on the ground that the same had been filed out of time. Hence, the instant petition. Issue: Whether or not NLRC committed a grave abuse of discretion amounting to lack of jurisdiction in dismissing petitioner’s appeal on a technicality. Held: Rule VIII of the Revised Rules of the National Labor Relations Commission on appeal, provides: SECTION 1. (a) Appeal. — Decision or orders of a labor Arbiter shall be final and

executory unless appealed to the Commission by any or both of the parties within ten (10) calendar days from receipt of notice thereof. SECTION 6. No extension of period. — No motion or request for extension of the period within which to perfect an appeal shall be entertained. The record shows that the employer (petitioner herein) received a copy of the decision of the Labor Arbiter on April 1, 1985. It filed a Motion for Extension of Time to File Memorandum of Appeal on April 11, 1985 and filed the Memorandum of Appeal on April 22, 1985. Pursuant to the "no extension policy" of the National Labor Relations Commission, aforesaid motion for extension of time was denied in its resolution dated November 15, 1985 and the appeal was dismissed for having been filed out of time. The Revised Rules of the National Labor Relations Commission are clear and explicit and leave no room for interpretation. Moreover, it is an elementary rule in administrative law that administrative regulations and policies enacted by administrative bodies to interpret the law which they are entrusted to enforce, have the force of law, and are entitled to great respect (Espanol v. Philippine Veterans Administration, 137 SCRA 314 [1985]). Under the above-quoted provisions of the Revised NLRC Rules, the decision appealed from in this case has become final and executory and can no longer be subject to appeal. Even on the merits, the ruling of the Labor Arbiter appears to be correct; the consistent promotions in rank and salary of the private respondent indicate he must have been a highly efficient worker, who should be retained despite occasional lapses in punctuality and attendance. Perfection cannot after all be demanded. WHEREFORE, this petition is DISMISSED. SO ORDERED. PASEI VS. DRILON 163 SCRA 386 JUNE 30, 1988 SARMIENTO, J. FACTS: The Department of Labor and Employment issued an order suspending the deployment of Filipino domestic and household workers, in view of the heightened abuses committed against OFWs abroad. The petitioner, a local recruitment agency, petitioned for the invalidation of such order for alleged violation of equal protection clause.

ISSUE: Whether or not the deployment ban a valid exercise of police power? What is police power? HELD: Yes, the deployment ban of domestic helpers is a valid exercise of police power. Police Power is the inherent power of the State to enact legislation that may interfere with personal liberty and property in order to promote the general welfare. CBTC EMPLOYERS UNION VS. CLAVE 141 SCRA 9 JANUARY 7, 1986 DE LA FUENTE, J. Facts: Commercial Bank and Trust Company Employees' Union lodged a complaint with the Department of Labor, against Commercial trust Bank for non-payment of the holiday pay benefits provided for under Art 95 of the Labor Code in relation to Rule X, Book III of the Rules and Regulations Implementing the Labor Code. Failing to arrive at an amicable settlement at conciliation level, the parties opted to submit their dispute for voluntary arbitration. The issue presented was, whether the permanent employees of the Bank within the collective bargaining unit paid on a monthly basis are entitled to holiday pay effective November 1, 1974, pursuant to Article 94 of the Labor Code. In addition, the disputants signed a Submission Agreement stipulating as final, unappealable and executory the decision of the Arbitrator, including subsequent issuances for clarificatory and/or relief purposes, notwithstanding Article 262 of the Labor Code.The Union filed a Manifestation stating that in the event that said Interpretative Bulletin regarding holiday pay would be adverse to the present claim union respectfully reserves the right to take such action as may be appropriate to protect its interests, a question of law being involved. An Interpretative Bulletin which was inexistent at the time they said commitment was made and which maybe contrary to the law itself should not bar the right of the union to claim for its holiday pay benefits.Voluntary Arbitrator stated that, there is more reason to believe that, if the Bank has never made any deduction from its monthly-paid employees for unworked Saturdays, Sundays, legal and special holidays, it is because there is really nothing to deduct properly since the monthly salary never really included pay for such unworked days-and which give credence to the conclusion that the divisor '250' is the proper one to use in computing the equivalent daily rate of the monthly-paid employees that both the decree itself and the Rules mentioned enumerated the excepted workers. It is a basic rule of statutory construction that putting an exception limits or modifies the enumeration or meaning made in the law. It is thus easy to see that a mere

reading of the Decree and of the Rules would show that the monthly-paid employees of the Bank are not expressly included in the enumeration of the exception.Voluntary Arbitrator directed the bank to pay its monthly paid employees their “legal holidaypay.” The next day, the Department of Labor released Policy Instructions No. 9 which clarifies controversies on the entitlement of monthly paid employees. The new determining rule is this: If themonthly paid employee is receiving not less than P 240, the maximum monthly minimum wage, and his monthly pay is uniform from January to December, he is presumed to be already paid the ten (10) paid legal holidays. However, if deductions are made from his monthly salary on account of holidays in months where they occur, then he is still entitled to the ten (10) paid legal holidays. Issue: Whether the permanent employees of the bank are entitled to holiday pay Held: Yes. They are entitled to holiday pay. In excluding the union members of herein petitioner from the benefits of the holiday pay law, public respondent predicated his ruling on Section 2, Rule IV, Book IIIof the Rules to implement Article 94 of the labor Code promulgated by the then Secretary of labor and Policy Instructions No. 9. The questioned Section 2, Rule IV, Book III of the Integrated Rules and the Secretary's Policy Instruction No. 9 add another excluded group, namely, 'employees who are uniformly paid by the month'. While the additional exclusion is only in the form of a presumption that all monthly paid employees have already been paid holiday pay, it constitutes a taking away or a deprivation towards the employee. NATIONAL HOUSING CORP. V. JUCO G.R. NO. L-64313 JANUARY 17, 1985 GUTIERREZ, JR., J. FACTS: Juco was an employee of the NHA. He filed a complaint for illegal dismissal w/ MOLE but his case was dismissed by the labor arbiter on the ground that the NHA is a govt-owned corp. and jurisdiction over its employees is vested in the CSC. On appeal, the NLRC reversed the decision and remanded the case to the labor arbiter for further proceedings. NHA in turn appealed to the SC ISSUE: Are employees of the National Housing Corporation, a GOCC without original charter, covered by the Labor Code or by laws and regulations governing the civil service? HELD: Sec. 11, Art XII-B of the Constitution specifically provides: "The Civil Service embraces every branch, agency, subdivision and instrumentality of the Government, including every government owned and controlled corporation. The inclusion of GOCC within the embrace of the civil serv¬ice shows a deliberate effort at the framers to plug an earlier loophole which allowed GOCC to avoid the full consequences of the civil service system. All offices and firms of the

government are covered. This consti provision has been implemented by statute PD 807 is unequivocal that personnel of GOCC belong to the civil service and subject to civil service requirements. "Every" means each one of a group, without exception. This case refers to a GOCC. It does not cover cases involving private firms taken over by the government in foreclosure or similar proceedings. NATIONAL SERVICE CORPORATION VS NLRC G.R. NO. L-69870 NOVEMBER 29, 1988 PADILLA, J. Facts: Eugenio Credo was an employee of the National Service Corporation. She claims she was illegally dismissed. NLRC ruled orderingher reinstatement. NASECO argues that NLRC has no jurisdiction to order her reinstatement. NASECO as a government corporation byvirtue of its being a subsidiary of the NIDC, which is wholly owned by the Phil. National Bank which is in turn a GOCC, the terms andconditions of employment of its em¬ployees are governed by the Civil Service Law citing National Housing v Juco. Issue: W/N employees of NASECO, a GOCC without original charter, are governed by the Civil Service Law. Ruling: NO. The holding in NHC v Juco should not be given retro¬active effect, that is to cases that arose before its promulga¬tion of Jan 17, 1985. To do otherwise would be oppressive to Credo and other employees similarly situated because under the 1973 Constibut prior to the ruling in NHC v Juco, this court recognized the applicability of the Labor jurisdiction over disputes involving terms andconditions of employment in GOCC's, among them NASECO.In the matter of coverage by the civil service of GOCC, the 1987 Consti starkly differs from the 1973 consti where NHC v Juco wasbased. It provides that the "civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government,including government owned or controlled corporation with origi¬nal charter." Therefore by clear implication, the civil service doesnot include GOCC which are organized as subsidiaries of GOCC under the general corporation law. REPUBLIC OF THE PHILIPPINES VS. COURT OF APPEALS G.R. NO. 87676 DECEMBER 20, 1989 GRINO-AQUINO, J.

FACTS NPDC was originally created in 1963 under Executive Order No. 30, as the Executive Committee for the development of the Quezon Memorial, Luneta and other national parks, and later renamed as the National Parks Development Committee under Executive Order No. 68, on September 21, 1967, it was registered in the Securities and Exchange Commission (SEC) as a non-stock and non-profit corporation, known as "The National Parks Development Committee, Inc. On March 20, 1988, NPDCEA (TUPAS local Chapter No. 967) and NPDCSA (TUPAS Chapter No. 1206), labor unions of employees of National Parks Development Committee ,staged a stake at the Rizal Park, Fort Santiago, Paco Park, and Pook ni Mariang Makiling at Los Banos, Laguna, alleging unfair labor practices. On March 21, 1988, NPDC filed in the Regional Trial Court in Manila, Branch III, a complaint against the union to declare the strike illegal and to restrain it on the ground that the strikers, being government employees, have no right to strike although they may form a union. Lower court dismissed the case for lack of jurisdiction as the case should be under the jurisdiction of Department of Labor as there exist an EmployerEmployee Relationship. Court of appeals affirmed the order of the trial court, hence, this petition for review. Issue whether the petitioner, National Parks Development Committee (NPDC), is a government agency, or a private corporation, for on this issue depends the right of its employees to strike. Ruling Since NPDC is a government agency, its employees are covered by civil service rules and regulations (Sec. 2, Article IX, 1987 Constitution). Its employees are civil service employees (Sec. 14, Executive Order No. 180). While NPDC employees are allowed under the 1987 Constitution to organize and join unions of their choice, there is as yet no law permitting them to strike. In case of a labor dispute between the employees and the government, Section 15 of Executive Order No. 180 dated June 1, 1987 provides that the Public Sector Labor- Management Council, not the Department of Labor and Employment, shall hear the dispute. Clearly, the Court of Appeals and the lower court erred in holding that the labor dispute between the NPDC and the members of the NPDSA is cognizable by the Department of Labor and Employment. WHEREFORE, the petition for review is granted. The decision of the Court of Appeals in CA-G.R. SP No. 14204 is hereby set aside. The private respondents' complaint should be filed in the Public Sector Labor-Management Council as provided in Section 15 of Executive Order No. 180. Costs against the private respondents.

LUZON DEVELOPMENT BANK VS. ASSOCIATION OF LUZON DEVELOPMENT BANK, ET AL. G.R. NO. 120319 OCTOBER 6, 1995 ROMERO, J. Facts: From a submission agreement of the Luzon Development Bank (LDB) and the Association of Luzon Development Bank Employees (ALDBE) arose an arbitration case to resolve the following issue: whether or not the company has violated the Collective Bargaining Agreement provision and the Memorandum of Agreement dated April1994, on promotion. At a conference, the parties agreed on the submission of their respective Position Papers on December 1-15, 1994. Atty. Ester S. Garcia, in her capacity as Voluntary Arbitrator, received ALDBE's Position Paper on January 18, 1995. LDB, on the other hand, failed to submit its Position Paper despite a letter from the Voluntary Arbitrator reminding them to do so. As of May 23, 1995 no Position Paper had been filed by LDB. On May 24, 1995, without LDB's Position Paper, the Voluntary Arbitrator rendered a decision disposing as follows: WHEREFORE, finding is hereby made that the Bank has not adhered to the Colle ctiveBargaining Agreement provision nor the Memorandum of Agreement on promotion. Hence, this petition for certiorari and prohibition seeking to set aside the decision of the Voluntary Arbitrator and to prohibit her from enforcing the same. Issue: Which court has the jurisdiction for the appellate review of adjudications of all quasi-judicial entities Held: Section 9 of B.P. Blg. 129, as amended by Republic Act No. 7902, provides that the Court of Appeals shall exercise: (B) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of Regional Trial Courts and quasi-judicial agencies, instrumentalities, boards or commissions ,including the Securities and Exchange Commission, the Employees Compensation Commission and the Civil Service Commission, except those falling within the appellate jurisdiction of the Supreme Court in accordance with the Constitution, the Labor Code of the Philippines under Presidential Decree No. 442,as amended, the provisions of this Act, and of subparagraph (1) of the third paragraph and subparagraph (4) of the fourth paragraph of Section 17 of the Judiciary Act of 1948. The voluntary arbitrator no less performs a state function pursuant to a governmental power delegated to him under the provisions there for in the Labor Code and he falls, therefore, within the contemplation of the term "instrumentality" in the afore quoted Sec. 9 of B.P. 129. The fact that his functions and powers are provided for in the Labor Code does not place him within the exceptions to said Sec. 9 since he is a quasi-judicial instrumentality as

contemplated therein A fortiori, the decision or award of the voluntary arbitrator or panel of arbitrators should likewise be appealable to the Court of Appeals, in line with the procedure outlined in Revised Administrative Circular No. 1-95, just like those of the quasi-judicial agencies, boards and commissions enumerated therein. This would be in furtherance of, and consistent with, the original purpose of Circular No. 1-91 to provide a uniform procedure for the appellate review of adjudications of all quasi-judicial entities not expressly excepted from the coverage of Sec. 9 of B.P. 129 by either the Constitution or another statute In the same vein, it is worth mentioning that under Section 22 of Republic Act No. 876, also known as the Arbitration Law, arbitration is deemed a special proceeding of which the court specified in the contract , or if none be specified, the Regional Trial Court for the province or city in which one of the parties resides or is doing business, or in which the arbitration is held, shall have jurisdiction. A party to the controversy may, at any time within one (1) month after an award is made, apply to the court having jurisdiction for an order confirming the award and the court must grant such order unless the award is vacated, modified or corrected. In effect, this equates the award or decision of the voluntary arbitrator with that of the regional trial court. Consequently, in a petition for certiorari from that award or decision, ACCORDINGLY, the Court resolved to REFER this case to the Court of Appeals SOCIAL SECURITY SYSTEM EMPLOYEES ASSOCIATION (SSSEA) VS. CA G.R. NO. 85279 JULY 28, 1989 CORTES, J. Facts: On June 11, 1987, the SSS filed with the Regional Trial Court of Quezon City a complaint for damages with a prayer for a writ of preliminary injunction against petitioners, alleging that on June 9, 1987, the officers and members of SSSEA staged an illegal strike and baricaded the entrances to the SSS Building, preventing non-striking employees from reporting for work and SSS members from transacting business with the SSS; that the strike was reported to the Public Sector Labor - Management Council, which ordered the strikers to return to work; that the strikers refused to return to work; and that the SSS suffered damages as a result of the strike. The complaint prayed that a writ of preliminary injunction be issued to enjoin the strike and that the strikers be ordered to return to work; that the defendants (petitioners herein) be ordered to pay damages; and that the strike be declared illegal.

It appears that the SSSEA went on strike after the SSS failed to act on the union's demands, which included: implementation of the provisions of the old SSSSSSEA collective bargaining agreement (CBA) on check-off of union dues; payment of accrued overtime pay, night differential pay and holiday pay; conversion of temporary or contractual employees with six (6) months or more of service into regular and permanent employees and their entitlement to the same salaries, allowances and benefits given to other regular employees of the SSS; and payment of the children's allowance of P30.00, and after the SSS deducted certain amounts from the salaries of the employees and allegedly committed acts of discrimination and unfair labor practices. Issue: Whether or not employees of the Social Security System (SSS) have the right to strike. Held: The 1987 Constitution, in the Article on Social Justice and Human Rights, provides that the State "shall guarantee the rights of all workers to selforganization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law" [Art. XIII, Sec. 31]. Resort to the intent of the framers of the organic law becomes helpful in understanding the meaning of these provisions. A reading of the proceedings of the Constitutional Commission that drafted the 1987 Constitution would show that in recognizing the right of government employees to organize, the commissioners intended to limit the right to the formation of unions or associations only, without including the right to strike. Considering that under the 1987 Constitution "the civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government, including government-owned or controlled corporations with original charters" [Art. IX(B), Sec. .2(l) see also Sec. 1 of E.O. No. 180 where the employees in the civil service are denominated as "government employees"] and that the SSS is one such government-controlled corporation with an original charter, having been created under R.A. No. 1161, its employees are part of the civil service [NASECO v. NLRC, G.R. Nos. 69870 & 70295, November 24,1988] and are covered by the Civil Service Commission's memorandum prohibiting strikes. This being the case, the strike staged by the employees of the SSS was illegal. ASSOCIATION OF SMALL LANDOWNERS O F THE PHILIPPINES VS. SECRETARY OF DAR G.R. No. 78742 JULY 14, 1989 CRUZ, J. Facts:

The petitioners in this case invoke the right of retention granted by P.D. No. 27 to owners of rice and corn lands not exceeding seven hectares as long as they are cultivating or intend to cultivate the same. Their respective lands do not exceed the statutory limit but are occupied by tenants who are actually cultivating such lands. According to P.D. No. 316, which was promulgated in implementation of P.D. No. 27: No tenant-farmer in agricultural lands primarily devoted to rice and corn shall be ejected or removed from his farmholding until such time as the respective rights of the tenant- farmers and the landowner shall have been determined in accordance with the rules and regulations implementing P.D. No. 27. The petitioners claim they cannot eject their tenants and so are unable to enjoy their right of retention because the Department of Agrarian Reform has so far not issued the implementing rules required under the above-quoted decree. They therefore ask the Court for a writ of mandamus to compel the respondent to issue the said rules. The public respondent argues that P.D. No. 27 has been amended by LOI 474 removing any right of retention from persons who own other agricultural lands of more than 7 hectares in aggregate area or lands used for residential, commercial, industrial or other purposes from which they derive adequate income for their family. And even assuming that the petitioners do not fall under its terms, the regulations implementing P.D. No. 27 have already been issued, to wit, the Memorandum dated July 10, 1975 (Interim Guidelines on Retention by Small Landowners, with an accompanying Retention Guide Table), Memorandum Circular No. 11 dated April 21, 1978, (Implementation Guidelines of LOI No. 474), Memorandum Circular No. 18-81 dated December 29,1981 (Clarificatory Guidelines on Coverage of P.D. No. 27 and Retention by Small Landowners), and DAR Administrative Order No. 1, series of 1985 (Providing for a Cut-off Date for Landowners to Apply for Retention and/or to Protest the Coverage of their Landholdings under Operation Land Transfer pursuant to P.D. No. 27). For failure to file the corresponding applications for retention under these measures, the petitioners are now barred from invoking this right. The petitioners insist that the above-cited measures are not applicable to them because they do not own more than seven hectares of agricultural land. The Constitution of 1987 was not to be outdone. Besides echoing these sentiments, it also adopted one whole and separate Article XIII on Social Justice and Human Rights, containing grandiose but undoubtedly sincere provisions for the uplift of the common people. These include a call in the following words for the adoption by the State of an agrarian reform program:

SEC. 4. The State shall, by law, undertake an agrarian reform program founded on the right of farmers and regular farmworkers, who are landless, to own directly or collectively the lands they till or, in the case of other farmworkers, to receive a just share of the fruits thereof. To this end, the State shall encourage and undertake the just distribution of all agricultural lands, subject to such priorities and reasonable retention limits as the Congress may prescribe, taking into account ecological, developmental, or equity considerations and subject to the payment of just compensation. In determining retention limits, the State shall respect the right of small landowners. The State shall further provide incentives for voluntary land-sharing. Issue: Whether or not all rights acquired by the tenant-farmer under P.D. No. 27, as recognized under E.O. No. 228, are retained by him even under R.A. No. 6657. Held: P.D. No. 27 expressly ordered the emancipation of tenant-farmer as October 21, 1972 and declared that he shall "be deemed the owner" of a portion of land consisting of a family-sized farm except that "no title to the land owned by him was to be actually issued to him unless and until he had become a full-fledged member of a duly recognized farmers' cooperative." It was understood, however, that full payment of the just compensation also had to be made first, conformably to the constitutional requirement. When E.O. No. 228, categorically stated in its Section 1 that: All qualified farmer-beneficiaries are now deemed full owners as of October 21, 1972 of the land they acquired by virtue of Presidential Decree No. 27. The CARP Law, for its part, conditions the transfer of possession and ownership of the land to the government on receipt by the landowner of the corresponding payment or the deposit by the DAR of the compensation in cash or LBP bonds with an accessible bank. Until then, title also remains with the landowner. No outright change of ownership is contemplated either. This should counter-balance the express provision in Section 6 of the said law that "the landowners whose lands have been covered by Presidential Decree No. 27 shall be allowed to keep the area originally retained by them thereunder, further, that original homestead grantees or direct compulsory heirs who still own the original homestead at the time of the approval of this Act shall retain the same areas as long as they continue to cultivate said homestead." R.A. No. 6657 does provide for such limits now in Section 6 of the law, which in fact is one of its most controversial provisions. Retention Limits. — Except as otherwise provided in this Act, no person may own or retain, directly or indirectly, any public or private agricultural land, the size of

which shall vary according to factors governing a viable family-sized farm, such as commodity produced, terrain, infrastructure, and soil fertility as determined by the Presidential Agrarian Reform Council (PARC) created hereunder, but in no case shall retention by the landowner exceed five (5) hectares. Three (3) hectares may be awarded to each child of the landowner, subject to the following qualifications: (1) that he is at least fifteen (15) years of age; and (2) that he is actually tilling the land or directly managing the farm; Provided, That landowners whose lands have been covered by Presidential Decree No. 27 shall be allowed to keep the area originally retained by them thereunder, further, That original homestead grantees or direct compulsory heirs who still own the original homestead at the time of the approval of this Act shall retain the same areas as long as they continue to cultivate said homestead. All rights previously acquired by the tenant- farmers under P.D. No. 27 are retained and recognized. Landowners who were unable to exercise their rights of retention under P.D. No. 27 shall enjoy the retention rights granted by R.A. No. 6657 under the conditions therein prescribed. Subject to the above-mentioned rulings all the petitions are DISMISSED, without pronouncement as to costs. ACUÑA VS. ARROYO G.R. NO. 79310 JULY 14, 1989 Facts: RA No. 6657, otherwise known as the Comprehensive Agrarian Reform Law of 1988 was signed into law by then President Corazon Aquino. There were a number of legal questions challenging the constitutionality of the several measures enacted to implement the CARL. In the instant case, the petitioners are landowners and sugar planters in the Victorias Mill District in Negros Occidental. Co-petitioner Planters’ Committee is an organization composed of 1,400 planter-members. This petition seeks to prohibit the implementation of Proclamation No. 131 and EO No. 229. The petitioners claim that the power to provide for a CARP as decreed by the constitution belongs to Congress and not the President. Even assuming that the interim legislative power of the President was properly exercised, Proc. No. 131 and EO No. 229 would still have to be annulled for violating the constitutional provisions on just compensation, due process and equal protection. Section 2 of Proc. No. 131 provides: Agrarian Reform Fund.- There is hereby created a special fund, to be known as the Agriarian Reform Fund, an initial amount of FIFTY BILLION PEOS to cover the estimated cost of the CARP from 1987 -1992 which shall be sourced from the receipts of the sale of the assets of the Asset Privatization Trust and Receipts of sale of ill-gotten wealth received through the PCGG and such other sources as

government may deem appropriate. The amounts collected and accruing to this special fund shall be appropriated automatically for the purpose authorized in this Proclamation. The money needed to cover the cost of the contemplated expropriated has yet to be raised and cannot be appropriated at this time. Petitioners contend that taking must be simultaneous with payment of just compensation as it is traditionally understood, i.e., with money and in full, but no such payment is contemplated in Sec. 5 of EO No. 229. The petitioners also argue that in the issuance of the two measures, no effort was made to make a careful study of the sugar planters’ situation. To the extent that the sugar planters have been lumped in the same legislation with other farmers, although they are a separate group with problems exclusively their own, their right to equal protection has been violated. Issue: Whether or not Proc. No. 31 and EO No. 229 are valid. Held: The Court upheld the presumption of constitutionality in favour of Proc. No. 131 and EO No. 229. Contrary to the petitioners’ contention, a pilot project to determine the feasibility of CARP and a general survey on the people’s opinion thereon are not indispensable prerequisites to its promulgation. On the alleged violation of the equal protection clause, the sugar planters have failed to show that they belong to a different class and should be treated differently. Regarding the issue of just compensation, it cannot be denied that the issue involved in the case is a revolutionary kind of expropriation. The expropriation in the instant case affects all private agricultural lands whenever found and of whatever kind as long as they are in excess of the maximum retention limits allowed their owners. This kind of expropriation is intended for the benefit not only of a particular community but of the entire Filipino nation. Such a program will involve not mere million of pesos. The cost will be tremendous. Considering the vast areas of land subject to expropriation under the laws before us, we estimate that hundreds of billions of pesos will be needed, far more indeed that the amount of P50 billion initially appropriated, which is already staggering as it is by our present standards. We assume that the framers of the Constitution were aware of this difficulty when they called for agrarian reform as a top priority project of the government. It is a

part of this assumption that when they envisioned the expropriation that would be needed, they also intended that the just compensation would have to be paid not in the orthodox way but a less conventional if more practical method. There can be doubt that they were aware of the financial limitations of the government and had no illusions that there would be enough money to pay in cash and in full for the lands they wanted to be distributed among the farmers. we may therefore assume that their intention was to allow such manner of payment as is now provided for by the CARP Law, particularly the payment of the balance, or indeed of the entire amount of the just compensation, with other things of value. Accepting the theory that payment of the just compensation is not always required to be made fully in money, we further that the proportion of cash payment to the other things of value constituting the total payment, as determined on the basis of the areas of the lands expropriated, is not unduly oppressive upon the landowner. Hence, the validity of Proc. No. 131 and EO No. 229 is SUSTAINED. GONZALES VS. CA G.R. NO. 36213 JUNE 29, 1989 Facts: The petitioners leased a lot in the subdivision on which they built their house, and, by tolerance of the subdivision owner, they cultivated some vacant adjoining lots. The Court of Agrarian Relations, as well as the Court of Appeals, ruled that "the plaintiffs are not de jure agricultural tenants." On October 26, 1988, Lucia A. Sison filed a motion to be substituted in lieu of the private respondents Andres Agcaoile (who died on May 20, 1976) and Leonora Agcaoile (who died on March 22, 1979) as she inherited, and is now the registered owner of, nine (9) unsold lots in the subdivision covered. On February 22, 1989, this Court granted her motion. The facts of this case are not disputed and are recited in the appealed decision dated December 6, 1972 of the Court of Appeals. Issue: W/N an agricultural tenancy relationship can be created over land embraced in an approved residential subdivision. Held: There is no merit in the petitioners' argument that inasmuch as residential and commercial lots may be considered "agricultural" (Krivenko vs. Register of

Deeds, 79 Phil. 461) an agricultural tenancy can be established on land in a residential subdivision. The Krivenko decision interpreting the constitutional prohibition against transferring private agricultural land to individuals, corporations, or associations not qualified to acquire or hold lands of the public domain, save in the case of hereditary succession (Art. XIII Sec. 5, 1935 Constitution; later Art. XIV, Sec. 14, 1973 Constitution; Art. XII, Sec. 7, 1987 Constitution) has nothing to do with agricultural tenancy. An agricultural leasehold cannot be established on land which has ceased to be devoted to cultivation or farming because of its conversion into a residential subdivision. Petitioners may not invoke Section 36(l) of Republic Act No. 3844 which provides that "when the lessor-owner fails to substantially carry out the conversion of his agricultural land into a subdivision within one year after the dispossession of the lessee, the lessee shall be entitled to reinstatement and damages," for the petitioners were not agricultural lessees or tenants of the land before its conversion into a residential subdivision in 1955. Not having been dispossessed by the conversion of the land into a residential subdivision, they may not claim a right to reinstatement. On the other hand, the petitioners' tactic of entering the subdivision as lessee of a homelot and thereafter cultivating some unsold lots ostensibly for temporary use as a home garden, but covertly for the purpose of later claiming the land as "tenanted" farm lots, recalls the fable of the camel that sought shelter inside its master's tent during a storm, and once inside, kicked its master out of the tent. Here, the private respondents' tolerance of the petitioners' supposedly temporary use of some vacant lots in the subdivision was seized by the latter as a weapon to deprive the respondents of their land. WHEREFORE, finding no reversible error in the decision of the Court of Appeals, We deny the petition for review for lack of merit. PEOPLE VS. PANIS G.R. NO. L-58674-77 JULY 11, 1990 Facts: Four informations were filed on January 9, 1981, in the Court of First Instance of Zambales and Olongapo City alleging that Serapio Abug, private respondent herein, "without first securing a license from the Ministry of Labor as a holder of authority to operate a fee-charging employment agency, did then and there wilfully, unlawfully and criminally operate a private fee-charging employment agency by charging fees and expenses (from) and promising employment in Saudi Arabia" to four separate individuals named therein, in violation of Article 16 in relation to Article 39 of the Labor Code.

V i r J e n S h i p p i n

Abug filed a motion to quash on the ground that the informations did not charge an offense because he was accused of illegally recruiting only one person in each of the four informations. Under the proviso in Article 13(b), he claimed, there would be illegal recruitment only "whenever two or more persons are in any manner promised or offered any employment for a fee." The posture of the petitioner is that the private respondent is being prosecuted under Article 39 in relation to Article 16 of the Labor Code; hence, Article 13(b) is not applicable. However, as the first two cited articles penalize acts of recruitment and placement without proper authority, which is the charge embodied in the informations, application of the definition of recruitment and placement in Article 13(b) is unavoidable. Issue: Whether or not the petitioner is guilty of violating Article 13(b) of P. D. 442, otherwise known as the Labor Code. Held: Article 13(b) of P. D. 442, otherwise known as the Labor Code, states that, "(b) 'Recruitment and placement' refers to any act of canvassing, 'enlisting, contracting, transporting, hiring, or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not: Provided, That any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement." As we see it, the proviso was intended neither to impose a condition on the basic rule nor to provide an exception thereto but merely to create a presumption. The presumption is that the individual or entity is engaged in recruitment and placement whenever he or it is dealing with two or more persons to whom, in consideration of a fee, an offer or promise of employment is made in the course of the "canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring (of) workers." At any rate, the interpretation here adopted should give more force to the campaign against illegal recruitment and placement, which has victimized many Filipino workers seeking a better life in a foreign land, and investing hard-earned savings or even borrowed funds in pursuit of their dream, only to be awakened to the reality of a cynical deception at the hands of their own countrymen. Acknowledgement: Peter De Guzman MILLARES AND LAGDA VS. NLRC

G.R. NO. 110524 JULY 29, 2002 KAPUNAN, J. FACTS: Douglas Millares was employed by ESSO International Shipping Company through its local manning agency,Trans-Global MaritimeAgency, as a machinist he was promoted as Chief Engineer which position Millares applied for a leave of absence for almost 1month. The Trans-Global, approved the request for leave of absence. Millares wrote to the Operations Manager of Exxon InternationalCo.informing him of his intention to avail of the optional retirement plan under the Consecutive Enlistment Incentive Plan (CEIP)considering that he had already rendered more than twenty (20) years of continuous service. Esso International, denied the requestfor optional retirement on the following grounds, to wit: (1) he was employed on a contractual basis; (2) his contract of enlistment(COE) did not provide for retirement before the age of sixty (60) years; and (3) he did not comply with the requirement for claimingbenefits under the CEIP, i.e., to submit a written advice to the company of his intention to terminate his employment within thirty (30)days from his last disembarkation date Millares requested for an extension of his leave of absence for another 15days. TheCrewing Manager, Ship Group A, Trans-Global, wrote petitioner Millares advising him that respondent Esso International "hascorrected the deficiency in its manpower requirements specifically in the Chief Engineer rank by promoting a First AssistantEngineer to this position as a result of (his) previous leave of absence which expired last August 8, 1989. The adjustment in saidrank was required in order to meet manpower schedules as a result of (his) inability.Esso International advised Millares that hisabsence without leave, which is equivalent to abandonment of his position,On the other hand Lagda was employed by Esso International as wiper/oiler He was promoted as Chief Engineer in 1980, a positionhe continued to occupy until his last COE expired on April 10, 1989.Lagda applied for a leave of absence from June 19,1989 up tothe whole month of August 1989. Then the Trans-Global’s approved petitioner Lagda’s leave of absence from June 22, 1989 to July20, 1989[7] and advised him to report for re-assignment on July 21, 1989. Lagda wrote a letter to Operations Manager of EssoInternational, through Trans-Global’s President informing him of his intention to avail of the optional early retirement plan in view of his twenty (20) years continuous service in the company Trans-Global denied petitioner Lagda’s request for availment of theoptional early retirement scheme on the same grounds upon which petitioner Millares’ request was denied.he requested for anextension of his leave of absence up to August 26, 1989 and the same was approved. However Esso International throughPersonnel Administrator,adise petitioner Lagda that in view of his "unavailability for contractual sea service," he had beendropped from the roster of crew members effective September 1, 1989.Millares and Lagda filed a complaint-affidavit, for illegal dismissal and nonpayment of employee benefits against privaterespondents Esso International and Trans-Global, before the POEA. POEA: dismissing the complaint for lack

of merit. NLRCdismissing petitioners’ appeal and denying their motion for new trial for lack of merit. ISSUE: WHETHER OR NOT THEY ARE REGULAR EMPLOYEES. RULING:SC: Art. 280. Regular and casual employment. - The provisions of written agreement to the contrary notwithstanding and regardlessof the oral agreement of the parties, an employment shall be deemed to be regular where the employee has been engaged toperform activities which are usually necessary or desirable in the usual business or trade of the employer, except where theemployment has been fixed for a specific project or undertaking the completion or termination of which has been determined at thetime of the engagement of the employee or where the work or services to be performed is seasonal in nature and the employment isfor 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 whohas rendered at least one year of service, whether such service is continuous or broken, shall be considered a regular employeewith respect to the activity in which he is employed and his employment shall continue while such activity exists. The primarystandard to determine a regular employment is the reasonable connection between the particular activity performed by theemployee in relation to the usual business or trade of the employer. The test is whether the former is usually necessary or desirablein the usual business or trade of the employer The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. Also, if the employee has been performing the job for at least one year, even if the performance isnot continuous or merely intermittent, the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the business. Hence, the employment is also considered regular, but only withrespect to such activity and while such activity exists.[it is undisputed that petitioners were employees of private respondents until their services were terminated on September 1, 1989.They served in their capacity as Chief Engineers, performing activities which were necessary and desirable in the business of private respondents Esso International, a shipping company; and Trans-Global, its local manning agency which supplies themanpower and crew requirements of Esso International’s vessels.It is, likewise, clear that petitioners had been in the employ of private respondents for 20 years. The records reveal that petitioners were repeatedly re-hired by private respondents even after theexpiration of their respective eightmonth contracts. Such repeated re-hiring which continued for 20 years, cannot but beappreciated as sufficient evidence of the necessity and indispensability of petitioners’ service to the private respondents’ business or trade. Verily, as petitioners are by express provision of Article 280 of the Labor Code, considered regular employees.there was no valid cause for the termination of petitioners. It will be recalled, that petitioner Millares was dismissed for allegedlyhaving "abandoned" his post; and petitioner Lagda, for his alleged "unavailability for contractual sea service." However, thatpetitioners did

not abandon their jobs such as to justify the unlawful termination of their employment is borne out by the records.Toconstitute abandonment, two elements must concur: (1) the failure to report for work or absence without valid or justifiable reason;and (2) a clear intention to sever the employer-employee relationship.Furthermore, the absence of petitioners was justified by thefact that they secured the approval of respondents to take a leave of absence after the termination of their last contracts of enlistment. Clearly, petitioners’ termination is illegal. DITAN VS. POEA ADMINISTRATOR G.R. NO. 79560 DECEMBER 3, 1990 Facts: Andres E. Ditan was recruited by private respondent Intraco Sales Corporation, through its local agent, Asia World, the other private respondent, to work in Angola as a welding supervisor. The contract was for nine months, at a monthly salary of US$1,100.00 or US$275.00 weekly, and contained the required standard stipulations for the protection of our overseas workers. Arriving on November 30, 1984, in Luanda, capital of Angola, the petitioner was assigned as an ordinary welder in the INTRACO central maintenance shop from December 2 to 25, 1984. On December 26, 1984, he was informed, to his distress that would be transferred to Kafunfo, some 350 kilometers east of Luanda. This was the place where, earlier that year, the rebels had attacked and kidnapped expatriate workers, killing two Filipinos in the raid. Naturally, Ditan was reluctant to go. However, he was assured by the INTRACO manager that Kafunfo was safe and adequately protected by government troops; moreover — and this was more persuasive — he was told he would be sent home if he refused the new assignment. In the end, with much misgiving, he relented and agreed. On December 29, 1984, his fears were confirmed. The Unita rebels attacked the diamond mining site where Ditan was working and took him and sixteen other Filipino hostages, along with other foreign workers. The rebels and their captives walked through jungle terrain for 31 days to the Unita stronghold near the Namibian border. They trekked for almost a thousand kilometers. They subsisted on meager fare. Some of them had diarrhea. Their feet were blistered. It was only on March 16, 1985, that the hostages were finally released after the intercession of their governments and the International Red Cross. Six days later, Ditan and the other Filipino hostages were back in the Philippines. The repatriated workers had been assured by INTRACO that they would be given priority in re-employment abroad, and eventually eleven of them were taken

back. Ditan having been excluded, he filed in June 1985 a complaint against the private respondents for breach of contract and various other claims. Specifically, he sought the amount of US$4,675.00, representing his salaries for the unexpired 17 weeks of his contract; US$25,000.00 as war risk bonus; US$2,196.50 as the value of his lost belongings; US$1,100 for unpaid vacation leave; and moral and exemplary damages in the sum of US$50,000.00, plus attorney's fees. All these claims were dismissed by POEA Administrator Tomas D. Achacoso in a decision dated January 27, 1987. 2 This was affirmed in toto by respondent NLRC in a resolution dated July 14, 1987, 3 which is now being challenged in this petition. Issue: Whether or not Ditan is entitled to any relief and his case is under the jurisdiction of NLRC? Held: Yes. The fact that stands out most prominently in the record is the risk to which the petitioner was subjected when he was assigned, after his reluctant consent, to the rebel-infested region of Kafunfo. This was a dangerous area. The petitioner had gone to that foreign land in search of a better life that he could share with his loved ones after his stint abroad. That choice would have required him to come home empty-handed to the disappointment of an expectant family. It is not explained why the petitioner was not paid for the unexpired portion of his contract which had 17 more weeks to go. The hostages were immediately repatriated after their release, presumably so they could recover from their ordeal. The promise of INTRACO was that they would be given priority in reemployment should their services be needed. In the particular case of the petitioner, the promise was not fulfilled. It would seem that his work was terminated, and not again required, because it was really intended all along to assign him only to Kafunfo. The private respondents stress that the contract Ditan entered into called for his employment in Angola, without indication of any particular place of assignment in the country. This meant he agreed to be assigned to work anywhere in that country, including Kafunfo. When INTRACO assigned Ditan to that place in the regular course of its business, it was merely exercising its rights under the employment contract that Ditan had freely entered into. Hence, it is argued, he cannot now complain that there was a breach of that contract for which he is entitled to monetary redress. The private respondents also reject the claim for war risk bonus and point out that POEA Memorandum Circular No. 4, issued pursuant to the mandatory war

risk coverage provision in Section 2, Rule VI, of the POEA Rules and Regulations on Overseas Employment, categorizing Angola as a war risk took effect only on February 6, 1985"after the petitioner's deployment to Angola on November 27, 1984." Consequently, the stipulation could not be applied to the petitioner as it was not supposed to have a retroactive effect. The paramount duty of this Court is to render justice through law. The law in this case allows two opposite interpretations, one strictly in favor of the employers and the other liberally in favor of the worker. The choice is obvious. We find, considering the totality of the circumstances attending this case, that the petitioner is entitled to relief. The petitioner went to Angola prepared to work as he had promised in accordance with the employment contract he had entered into in good faith with the private respondents. Over his objection, he was sent to a dangerous assignment and as he feared was taken hostage in a rebel attack that prevented him from fulfilling his contract while in captivity. Upon his release, he was immediately sent home and was not paid the salary corresponding to the unexpired portion of his contract. He was immediately repatriated with the promise that he would be given priority in re-employment, which never came. To rub salt on the wound, many of his co-hostages were re-employed as promised. The petitioner was left only with a bleak experience and nothing to show for it except dashed hopes and a sense of rejection. Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privileges in life should have more privileges in law. WHEREFORE, the challenged resolution of the NLRC is hereby MODIFIED. The private respondents are hereby DIRECTED jointly and severally to pay the petitioner: a) the current equivalent in Philippine pesos of US$4,675.00, representing his unpaid salaries for the balance of the contract term; b) nominal damages in the amount of P20,000.00; and c) 10% attorney's fees. No costs. SO ORDERED. VINTA MARITIME COMPANY V NLRC G.R. NO. 113911 JANUARY 23, 1998 Facts: Leonides Basconsillo, private respondent, filed a complaint with the Philippine Overseas Employment Administration IPOEA) for illegal dismissal against Vinta Maritime Co. Inc. and Elkano Ship Management, Inc. petitioners alleged that Leonides was dismissed for his gross negligence and incompetent performance as chief engineer of the M/V Boracay. The POEA ruled that private respondent was illegally dismissed. On appeal, the

NLRC affirmed the POEA. Likewise, the NLRC denied the motion for reconsideration. Hence, this petition. Issue: Whether or not private respondent is illegally dismissed. Held: The absence of a valid cause for termination in this case is apparent. For an employee’s dismissal to be valid, (1) the dismissal must be for a valid cause and (2) the employee must be afforded due process. Petitioners allege that private respondent was dismissed because of his incompetence, enumerating incidents in proof thereof. However, this is contradicted by private respondent’s seaman’s book which states that his discharge was due to an emergency leave. Moreover, his alleged incompetence is belied by the remarks made by petitioners in the same book that private respondent’s services were “highly recommended” and that his conduct and ability were rated “very good “. Petitioners’ allegation that such remark and ratings were given to private respondent as an accommodation for future employment fails to persuade. The Court cannot consent to such an accommodation, even if the allegation were true, as it is a blatant misrepresentation. It cannot exculpate petitioners based on such misrepresentation. When petitioners issued the accommodation, they must have known its possible repercussions. Due process, the second element for a valid dismissal, requires notice and hearing. Before the employee can be dismissed under Art. 282, the Code requires the service of a written notice containing a statement of the cause/s of termination and giving said employee ample opportunity to be heard and to defend himself. A notice of termination in writing is further required if the employee’s dismissal is decided upon. The employer must furnish the worker with two written notices before termination of employment can be legally effected: (1) notice which apprises the employee of the particular acts or omissions for which his dismissal is sought and (2) subsequent notice which informs the employee of the employer’s decision to dismiss. The twin requirements of notice and hearing constitute the essential elements of due process, and neither of these elements can be eliminated without running afoul of the constitutional guaranty. Illegally dismissed workers are entitled to the payment of their salaries corresponding to the unexpired portion of their employment where the employment is for a definite period. Conformably, the administrator and the NLRC properly awarded private respondent salaries for the period of the effectivity of his contract. WHEREFORE, the petition is hereby dismissed. The challenged decision and resolution are affirmed.

MARSAMAN MANNING AGENCY VS. NLRC G.R. NO. 127195 AUGUST 25, 1999 R.A. 8042 (Migrant Workers Act) Facts: Private respondent Wilfredo T. Cajeras was hired by petitioner MARSAMAN, the local manning agent of petitioner DIAMANTIDES, as Chief Cook Steward on the MV Prigipos, owned and operated by DIAMANTIDES, for a contract period of ten (10) months. Cajeras started work on 8 August 1995, but less than two (2) months later, he was repatriated to the Philippines allegedly by "mutual consent." Private respondent Cajeras filed a complaint for illegal dismissal against petitioners with the NLRC alleging that he was dismissed illegally, denying that his repatriation was by mutual consent, and asking for his unpaid wages, overtime pay, damages, and attorney's fees. On 29 January 1996 Labor Arbiter resolved the dispute in favor of private respondent Cajeras ruling that the latter's discharge from the MV Prigipos allegedly by "mutual consent" was not proved by convincing evidence. Petitioners appealed to the NLRC. On 16 September 1996 the NLRC affirmed the appealed findings and conclusions of the Labor Arbiter. Petitioners' motion for reconsideration was denied by the NLRC in its Resolution dated 12 November 1996. Hence, the petition contending that, among other things, the NLRC committed grave abuse of discretion in ordering a monetary award beyond the maximum of three (3) months' salary for every year of service set by RA 8042. Issue: Whether or not the NLRC committed grave abuse of discretion Ruling: On the amount of salaries due private respondent, the rule has always been that an illegally dismissed worker whose employment is for a fixed period is entitled to payment of his salaries corresponding to the unexpired portion of his employment. On 15 July 1995, RA 8042 otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995" took effect, Sec. 10 of which provides: Sec. 10. In case of termination of overseas employment without just, valid or authorized cause as defined by law or contract, the worker shall be entitled to the

full reimbursement of his placement fee with interest at twelve percent (12%) per annum, plus his salaries for the unexpired portion of the employment contract or for three (3) months for every year of the unexpired term whichever is less. A plain reading of Sec. 10 clearly reveals that the choice of which amount to award an illegally dismissed overseas contract worker, i.e., whether his salaries for the unexpired portion of his employment contract or three (3) months' salary for every year of the unexpired term, whichever is less, comes into play only when the employment contract concerned has a term of at least one (1) year or more. To follow petitioners' thinking that private respondent is entitled to three (3) months salary only simply because it is the lesser amount is to completely disregard and overlook some words used in the statute while giving effect to some. This is contrary to the well-established rule in legal hermeneutics that in interpreting a statute, care should be taken that every part or word thereof be given effect since the law-making body is presumed to know the meaning of the words employed in the statue and to have used them advisedly. The questioned Decision and Resolution of public respondent National Labor Relations Commission are AFFIRMED. ASIAN CENTER FOR CAREER AND EMPLOYMENT SYSTEM AND SERVICES, INC. (ACCESS),VS. NATIONAL LABOR RELATIONS COMMISSION AND IBNO MEDIALES G.R. NO. 131656 OCTOBER 12, 1998 Facts: petitioner hired respondent IBNO MEDIALES to work as a mason in Jeddah, Saudi Arabia with a monthly salary of 1,200 Saudi Riyals (SR). The term of his contract was two (2) years, from February 28, 1995 until February 28, 1997. On May 26, 1996, respondent applied with petitioner for vacation leave with pay and was granted. While en route to the Philippines, his co-workers informed him that he has been dismissed. respondent filed a complaint with the labor arbiter for illegal dismissal. And found guilty and to pay the unexpired portion of the respondent ‘s contract which is 1,200 multiplied by 8 months representing the unexpired portion. Petitioner appealed to the NLRC but the latter affirmed the decision of labor arbiter but modified the appealed decision by deleting the order of refund of excessive placement fee for lack of jurisdiction. Petitioner moved for reconsideration with respect to the labor arbiter’s award by invoking Section 10 RA 8042 that a worker dismissed from overseas employment without just, valid or authorized cause is entitled to his salary for the unexpired portion of his employment contract or for three (3) months for every year of the unexpired term, whichever is less that is why it should be three years should be used for the unexpired portion. NLRC denied the motion. Hence, this petition for certiorari.

Issue: Whether or not the monetary awards granted by the NLRC to private respondent is correct? Held: The SC affirmed the decisions of NLRC with modifications regarding the basis of amount that the petitioner will pay to the respondent for the unexpired portion of employment contract. In the case at bar, petitioner’s illegal dismissal from service is no longer disputed. Petitioner merely impugns the monetary awards granted by the NLRC to private respondent. The effectivity of Section 10 RA 8042 took effect a year earlier from his vacation leave. Hence, it applies to the case. The respondent should be paid by petitioner the 3 months unexpired portion of the contract. ATHENNA INTERNATIONAL MANPOWER SERVICES, INC. vs. VILLANOS G.R. No. 151303. April 15, 2005 QUISUMBING,J: Facts: The petitioner is a domestic corporation engaged in recruitment and placement of workers for overseas employment. Respondent applied to work overseas as caretaker thru petitioner. The petitioner asked for a placement fee amounting to P100,000 but the respondent begged to reduced the fee and it was reduced to P94,000 with the petitioner paying only P30,000 and the remaining will be paid through salary deductions. Upon arrival on Taiwan, he was assigned to a mechanical shop, owned by Hsien, as a hydraulic installer/repairer for car lifters, instead of the job for which he was hired. He did not, however, complain because he needed money to pay for the debts he incurred back home. Barely a month after his placement, he was terminated by Hsien and received his salary and instructed for departure to the Philippines. Upon arrival, the respondent went to petitioner’s office and demanded for the reimbursement of P30,000 but instead the petitioner gave him a summary of expenses relating his deployment. The respondent filed a complaint before Adjudication Office of the POEA. However, because of financial constraints, he had to go home to Polanco, Zamboanga del Norte and filed a complaint against petitioner for illegal dismissal, violation of contract, and recovery of unpaid salaries and other benefits before the NLRC Sub-Regional Arbitration Branch No. 9, Dipolog City. In its defense, petitioner alleged that under the employment contract, respondent was to undergo a probationary period of forty (40) days. However, at the job site, respondent was found to be unfit for his work, thus he resigned from his employment and

requested for his repatriation signing a statement to that effect. The Labor Arbiter rendered a Decision holding petitioner and Wei Yu Hsien solidarily liable for the wages representing the unserved portion of the employment contract, the amount unlawfully deducted from respondent’s monthly wage, moral damages, exemplary damages and attorney’s fees. On appeal, the NLRC reversed the Labor Arbiter and dismissed the complaint for lack of merit. It found that respondent was not at all dismissed, much less illegally. Respondent seasonably filed a motion for reconsideration, which the NLRC denied in its second resolution. respondent appealed to the Court of Appeals and granted the petition and reversing the questioned resolutions of the NLRC. Issue: 1. Did the respondent voluntarily resign or was he illegally dismissed? 2. Assuming that the respondent was illegally dismissed, was it proper for the Court of Appeals to affirm in toto the monetary awards in the Decision of the Labor Arbiter? Held: The SC denied the petition and affirmed with modification the resolution by the Court of Appeals. On the first issue, An employee voluntarily resigns when he finds himself in a situation where he believes that personal reasons cannot be sacrificed in favor of the exigency of the service; thus, he has no other choice but to disassociate himself from his employment. In this case respondent avers that petitioner did not explain why he was unqualified nor inform of any qualifications needed for the job prior to his deployment as mandated by Art 281[9] of the Labor Code and failed to prove the legality of the dismissal, despite the fact that the burden of proof lies on the employment and recruitment agency. On the second issue, the SC declared the petitioner solidarily liable with Wei Yu Hsien to pay the unexpired portion based on Sec 10 RA 8042. Lastly, because of the breach of contract and bad faith alleged against the employer and the petitioner, we must sustain the award of P50,000 in moral damages and P50,000 as exemplary damages, in addition to attorney’s fees of ten percent (10%) of the aggregate monetary awards.

EASTERN SHIPPING LINES V POEA G.R. NO. 76633 OCTOBER 18, 1988 FACTS: A Chief Officer of a ship was killed in an accident in Japan. The widow filed a complaint for charges against the Eastern Shipping Lines with POEA, based on a Memorandum Circular No. 2, issued by the POEA which stipulated death benefits

and burial for the family of overseas workers. ESL questioned the validity of the memorandum circular as violative of the principle of non-delegation of legislative power. It contends that no authority had been given the POEA to promulgate the said regulation; and even with such authorization, the regulation represents an exercise of legislative discretion which, under the principle, is not subject to delegation. Nevertheless, POEA assumed jurisdiction and decided the case. ISSUE: Whether or not the Issuance of Memorandum Circular No. 2 is a violation of nondelegation of powers. RULING: No. SC held that there was a valid delegation of powers. The authority to issue the said regulation is clearly provided in Section 4(a) of Executive Order No. 797. ... "The governing Board of the Administration (POEA), as hereunder provided shall promulgate the necessary rules and regulations to govern the exercise of the adjudicatory functions of the Administration (POEA)." It is true that legislative discretion as to the substantive contents of the law cannot be delegated. What can be delegated is the discretion to determine how the law may be enforced, not what the law shall be. The ascertainment of the latter subject is a prerogative of the legislature. This prerogative cannot be abdicated or surrendered by the legislature to the delegate. The reasons given above for the delegation of legislative powers in general are particularly applicable to administrative bodies. With the proliferation of specialized activities and their attendant peculiar problems, the national legislature has found it more and more necessary to entrust to administrative agencies the authority to issue rules to carry out the general provisions of the statute. This is called the "power of subordinate legislation." With this power, administrative bodies may implement the broad policies laid down in a statute by "filling in' the details which the Congress may not have the opportunity or competence to provide. This is effected by their promulgation of what are known as supplementary regulations, such as the implementing rules issued by the Department of Labor on the new Labor Code. These regulations have the force and effect of law. There are two accepted tests to determine whether or not there is a valid delegation of legislative power: 1. Completeness test - the law must be complete in all its terms and conditions when it leaves the legislature such that when it reaches the delegate the only thing he will have to do is enforce it. 2. Sufficient standard test - there must be adequate guidelines or stations in the law to map out the boundaries of the delegate's authority and prevent the delegation from running riot.

Both tests are intended to prevent a total transference of legislative authority to the delegate, who is not allowed to step into the shoes of the legislature and exercise a power essentially legislative. NORSE MANAGEMENT CO. VS. NATIONAL SEAMEN BOARD G.R. NO. L-54204 SEPTEMBER 30, 1982 RELOVA, J. Facts: Napoleon B. Abordo, the deceased husband of private respondent Restituta C. Abordo, was the Second Engineer of M.T. "Cherry Earl" when he died from an apoplectic stroke in the course of his employment with petitioner NORSE MANAGEMENT COMPANY (PTE). The M.T. "Cherry Earl" is a vessel of Singaporean Registry. In her complaint for compensation benefits filed before the National Seamen Board, private respondent alleged that the amount of compensation due her from petitioners should be based on the law where the vessel is registered. Petitioners contend that the law of Singapore should not be applied in this case because the National Seamen Board cannot take judicial notice of the Workmen's Insurance Law of Singapore instead must be based on Board’s Memeorandum Circular No. 25. Ministry of Labor and Employment ordered the petitioner to pay jointly and severally the private respondent. Petitioner appealed to the Ministry of Labor but same decision. Hence, this petition. Issue: Whether or not the law of Singapore ought to be applied in this case. Held: The SC denied the petition. It has always been the policy of this Board, as enunciated in a long line of cases, that in cases of valid claims for benefits on account of injury or death while in the course of employment, the law of the country in which the vessel is registered shall be considered. In Section 5(B) of the Employment Agreement between petitioner and respondent’s husband states that In the event of illness or injury to Employee arising out of and in the course of his employment and not due to his own willful misconduct, EMPLOYER will provide employee with free medical attention. If such illness or injury incapacitates the EMPLOYEE to the extent the EMPLOYEE's services must be terminated as determined by a qualified physician designated by the EMPLOYER and provided such illness or injury was not due in part or whole to his willful act, neglect or misconduct compensation shall be paid to employee in accordance with and subject to the limitations of the Workmen's Compensation Act of the Republic of the Philippines or the Workmen's Insurance Law of registry of the

vessel whichever is greater. Finally, Article IV of the Labor Code provides that "all doubts in the implementation and interpretation of the provisions of this code, including its implementing rules and resolved in favor of labor. NFD INTERNATIONAL MANNING AGENTS VS. NLRC G.R. NO. 116629 JANUARY 16, 1998 PUNO, J. Facts: The private respondents (wives of the two deceased husbands) filed for death compensation benefits under the POEA Standard Contract of employment before the petitioners but were denied on the ground that the seaman’s deaths were due to their own wilful act who implanted fragments of reindeer horn in their respective sexual organs that due to the lack of sanitary conditions at the time and place of implantation, all three seamen suffered "severe tetanus" and "massive viral infections;" that Misada and Envidiado died within days of the other; that the third seaman, Arturo Fajardo, narrowly missed death only because the vessel was at port in Penang, Malaysia at the time the tetanus became critical. Private respondents filed separate complaints before the POEA Adjudication Office. POEA Administrator dismissed the case for lack of merit. Private respondents appealed to respondent Commission. During the pendency of the appeal, private respondents submitted additional documentary evidence in support of their Memorandum on Appeal. Respondent Commission reversed the POEA Administrator and ordered petitioners to pay private respondents. Hence this petition. Issue: Whether respondent Commission gravely erred in finding that the deaths of the two seamen did not come as a result of their wilful and deliberate act. Held: The SC dismissed the petition and affirmed the decision of NLRC. According to Part II, Section C, no. 6 of POEA “Standard Employment Contract Governing the Employment of All Filipino Seamen on Board Ocean-Going Vessels” No compensation shall be payable in respect of any injury, incapacity, disability or death resulting from a willful act on his own life by the seaman, provided, however, that the employer can prove that such injury, incapacity, disability or death is directly attributable to him. In this case, the testimonies of the officers are insufficient to prove the fact that death of two seamen were caused by selfinflicted injuries and in fact Fajardo, one who did the same, did not submit any testimony regarding the implantation. No autopsy report was presented to corroborate their testimonies. Based on medical reports cause of death of Misada

was due to viral infection, while Envidiado was due to viral myocarditis. Hence, petitioner’s evidence insufficiently proves the fact that the deaths of the two seamen were caused by their own wilful and deliberate act. VIRJEN SHIPPING AND MARINE SERVICES VS. NLRC 125 SCRA 577 NOVEMBER 18, 1983 GUTIERREZ, JR., J. Facts: Certain seamen entered into a contract of employment for a 12-month period. Some three months after thecommencement of their employment, the seamen demanded a 50% increase of their salaries and benefits. Theseamen demanded this increase while their vessel was on route to a port in Australia controlled by the InternationalTransport Federation (ITP) where the ITF could detain the vessels unless it paid its season ITF rates.The agent of the owner of the vessel agreed to a 25% increase, but when the vessel arrived in Japan shortly afterwards, the seamen were repatriated to Manila and their contract terminated.Two motions for reconsideration filed with Second Division were denied by said Division. Another motion forreconsideration was filed with the Supreme Court en banc which gave its due course, after finding that there was aneed to reconcile the decision of the Second Division with that of the First Division with the Wallen Decision. In thatdecision, the First Division had ruled that the termination of the seamen was illegal. Issue: Whether or not the termination of the seamen was illegal. Held: The termination of the contract of the seamen was illegal. A manning contract involves the interests not only of the signatories thereto, such as the local Filipino recruiting agent, the foreign owner of vessel and the Filipinoseamen in general as well as the country itself. Conformably to the power vested in the NSB, the law requires that allmanning contracts shall be approved by said agency. The stringent rules governing Filipino seamen abroad foreignships are dictated by national interest.

SUZARA VS. BENIPAYO G.R. NO. 57999 SUZARA VS. NLRC AUGUST 15, 1989 GUTIERREZ, J.

Facts: A group of Filipino seamen entered into separate contracts of employment with Magsaysay lines at specified salary rates. When vessel reached Manila Magsaysay Lines demanded from Seamen over payment made to them in Canada the seamen demanded and received additional wages prescribed by the International Transport workers Federation (ITF) in amounts over and above the rates appearing in their contract approved earlier by the National Seamen Board . When the vessel docked at Nagoya , an NSB representative boarded the vessel He called a meeting among seamen, an urged them to sign an agreement, which they did. It turned out that in the agreement the following statement was inserted the amounts were received and held by crew members in trust for ship owners when reached Manila Magsaysay Lines demanded from seamen the overpayments made to them in Canada. When they refused, it filed charges against them before the NSB.NSB declared the seamen guilty of breach of their employment contracts suspended these men for three years, prompting the workers to bring the case up to the Supreme Court Issue: Whether the Seaman demanded and received additional wages prescribes International Transport Workers Federation. Held: The Supreme Court reversed and set aside the decision of NSB-National seamen Board and the NLRC, it held that Seamen were not guilty of the offense for which they were charged and order Magsaysay Lines to pay the seamen their earned but unpaid wages overtime pay Special Agreement that the parties entered into Vancouver. The criminal cases were ordered dismissed. The Court reiterate the Vir-jen pronouncements. Decision: The Supreme Court By Justice Guitterez CHAVEZ VS. BONTO-PEREZ, RAYALA, ET AL. G.R. NO. 109808 MARCH 1, 1995 PUNO, J. Facts: Chavez is a dancer who was contracted by Centrum Placement & Promotions Corporation to perform in Japan for 6 months. The contract was for $1.5k a month, which was approved by POEA. After the approval of said contract, Chavez entered into a side contract reducing her salary with her Japanese employer through her local manager-agency (Jaz Talents Promotion). The salary was reduced to $500 and $750 was to go to Jaz Talents. In February 1991 (two years after the expiration of her contract), Chavez sued Centrum Placement and Jaz Talents for underpayment of wages before the POEA.

The POEA ruled against her. POEA stated that the side agreement entered into by Chavez with her Japanese employer superseded the Standard Employment Contract; that POEA had no knowledge of such side agreement being entered into; that Chavez is barred by laches for sleeping on her right for two years. ISSUE: Whether or not Chavez is entitled to relief. HELD: Yes. The SC ruled that the managerial commission agreement executed by Chavez to authorize her Japanese Employer to deduct her salary is void because it is against our existing laws, morals and public policy. It cannot supersede the standard employment contract approved by the POEA with the following stipulation appended thereto: It is understood that the terms and conditions stated in this Employment Contract are in conformance with the Standard Employment Contract for Entertainers prescribed by the POEA under Memorandum Circular No. 2, Series of 1986. Any alterations or changes made in any part of this contract without prior approval by the POEA shall be null and void; The side agreement which reduced Chavez’s basic wage is null and void for violating the POEA’s minimum employment standards, and for not having been approved by the POEA. Here, both Centrum Placement and Jaz Talents are solidarily liable. Laches does not apply in the case at bar. In this case, Chavez filed her claim well within the three-year prescriptive period for the filing of money claims set forth in Article 291 of the Labor Code. For this reason, laches is not applicable. FINMAN GENERAL ASSURANCE CORP. vs. INOCENCIO G.R. No. 90273-75 November 15, 1989 Feliciano, J. Facts: Pan Pacific Overseas is a recruitment agency which offers jobs abroad duly registered with the POEA. Finman General is acting as Pan Pacific’s surety (as required by POEA rules and Art. 31 of the Labor Code). Pan Pacific was sued by William Inocencio and 3 others for alleged violation of Article 32 and 34 of the Labor Code. Inocencio alleged that Pan Pacific charged and collected fees but failed to provide employment abroad. POEA ruled in favor of Inocencio et al and had impleaded Finman (upon request of Inocencio) in the complaint as well (Pan Pacific changed business address without prior notice to POEA). The Labor Secretary affirmed POEA’s ruling. Finman General asserts that it should not be impleaded in the case because it is not a party to the contract between Pan Pacific and Inocencio et al. ISSUE:

Whether or not Finman General is solidarily liable in the case at bar. HELD: Yes. Since Pan Pacific had thoughtfully refrained from notifying the POEA of its new address and from responding to the complaints, petitioner Finman may well be regarded as an indispensable party to the proceedings before the POEA. Whether Finman was an indispensable or merely a proper party to the proceedings, the SC held that the POEA could properly implead it as party respondent either upon the request of Inocencio et al or motu propio. Such is the situation under the Revised Rules of Court. Finman General is solidarily liable. Under Section 176 of the Insurance Code, as amended, the liability of a surety in a surety bond (Finman) is joint and several with the principal obligor (Pan Pacific). Further, Article 31 of the Labor Code provides: Art. 31. Bonds. — All applicants for license or authority shall post such cash and surety bonds as determined by the Secretary of Labor to guarantee compliance with prescribed recruitment procedures, rules and regulations, and terms and, conditions of employment as appropriate. xxx The Secretary of Labor shall have the exclusive power to determine, decide, order or direct payment from, or application of, the cash and surety bond for any claim or injury covered and guaranteed by the bonds. EASTERN ASSURANCE & SURETY CORPORATION VS. SECRETARY OF LABOR G.R. NO. L-79436-50 JANUARY 17, 1990 NARVASA, J. Facts: J&B Manpower is an overseas employment agency registered with the POEA and Eastern Assurance was its surety beginning January 1985. From 1983 to December 1985, J&B recruited 33 persons but none of them were ever deployed. These 33 persons sued J&B and the POEA as well as the Secretary of Labor ruled in favor of the 33 workers and ordered J&B to refund them (with Eastern Assurance being solidarily liable). Eastern Assurance assailed the ruling claiming that POEA and the Secretary of Labor have no jurisdiction over non-employees (since the 33 were never employed, in short, no employer-employee relations). ISSUE: Whether or not Eastern Assurance can be held liable in the case at bar. HELD: Yes. But only for the period covering from January 1985 when the surety took effect (as already held by the Labor Secretary). The Secretary of Labor was given power by Article 34 (Labor Code) and Section 35 and 36 of EO 797 (POEA Rules) to “restrict and regulate the recruitment and placement activities of all

agencies,” but also to “promulgate rules and regulations to carry out the objectives and implement the provisions” governing said activities. Implicit in these powers is the award of appropriate relief to the victims of the offenses committed by the respondent agency or contractor, specially the refund or reimbursement of such fees as may have been fraudulently or otherwise illegally collected, or such money, goods or services imposed and accepted in excess of what is licitly prescribed. It would be illogical and absurd to limit the sanction on an offending recruitment agency or contractor to suspension or cancellation of its license, without the concomitant obligation to repair the injury caused to its victims. Though some of the cases were filed after the expiration of the surety bond agreement between J&B and Eastern Assurance, notice was given to J&B of such anomalies even before said expiration. In this connection, it may be stressed that the surety bond provides that notice to the principal is notice to the surety. Besides, it has been held that the contract of a compensated surety like respondent Eastern Assurance is to be interpreted liberally in the interest of the promises and beneficiaries rather than strictly in favor of the surety. SALAZAR VS. ACHACOSO G.R. NO. 81510 MARCH 14, 1990 SARMIENTO, J. Facts: Rosalie Tesoro of Pasay City in a sworn statement filed with the POEA, charged petitioner with illegal recruitment. Public respondent Atty. Ferdinand Marquez sent petitioner a telegram directing him to appear to the POEA regarding the complaint against him. On the same day, after knowing that petitioner had no license to operate a recruitment agency, public respondent Administrator Tomas Achacoso issued a Closure and Seizure Order No. 1205 to petitioner. It stated that there will a seizure of the documents and paraphernalia being used or intended to be used as the means of committing illegal recruitment, it having verified that petitioner has— (1) No valid license or authority from the Department of Labor and Employment to recruit and deploy workers for overseas employment; (2) Committed/are committing acts prohibited under Article 34 of the New Labor Code in relation to Article 38 of the same code. A team was then tasked to implement the said Order. The group, accompanied by mediamen and Mandaluyong policemen, went to petitioner’s residence. They served the order to a certain Mrs. For a Salazar, who let them in. The team confiscated assorted costumes. Petitioner filed with POEA a letter requesting for the return of the seized properties, because she was not given prior notice and hearing. The said Order violated due process. She also alleged that it violated sec 2 of the Bill of Rights, and the properties were confiscated against her will and were done with unreasonable force and intimidation.

Issue: Whether or Not the Philippine Overseas Employment Administration (or the Secretary of Labor) can validly issue warrants of search and seizure (or arrest) under Article 38 of the Labor Code Held: Under the new Constitution, “. . . no search warrant or warrant of arrest shall issue except upon probable cause to be determined personally by the judge after examination under oath or affirmation of the complainant and the witnesses he may produce, and particularly describing the place to be searched and the persons or things to be seized”. Mayors and prosecuting officers cannot issue warrants of seizure or arrest. The Closure and Seizure Order was based on Article 38 of the Labor Code. The Supreme Court held, “We reiterate that the Secretary of Labor, not being a judge, may no longer issue search or arrest warrants. Hence, the authorities must go through the judicial process. To that extent, we declare Article 38, paragraph (c), of the Labor Code, unconstitutional and of no force and effect… The power of the President to order the arrest of aliens for deportation is, obviously, exceptional. It (the power to order arrests) cannot be made to extend to other cases, like the one at bar. Under the Constitution, it is the sole domain of the courts.” Furthermore, the search and seizure order was in the nature of a general warrant. The court held that the warrant is null and void, because it must identify specifically the things to be seized. SORIANO VS. OFFSHORE SHIPPING AND MARKETING CORP. G.R. NO. 78409 SEPT. 14, 1989 FERNAN, C.J. Facts: In search for better opportunities and higher income, petitioner Norberto Soriano, a licensed Second Marine Engineer, sought employment and was hired by private respondent Knut Knutsen O.A.S. through its authorized shipping agent in the Philippines, Offshore Shipping and Manning Corporation. As evidenced by the Crew Agreement, petitioner was hired to work as Third Marine Engineer on board Knut Provider" with a salary of US$800.00 a month on a conduction basis for a period of fifteen (15) days. He admitted that the term of the contract was extended to six (6) months by mutual agreement on the promise of the employer to the petitioner that he will be promoted to Second Engineer. Thus, while it appears that petitioner joined the aforesaid vessel on July 23, 1985 he signed off on November 27, 1985 due to the alleged failure of private respondent-employer to fulfill its promise to promote petitioner to the position of Second Engineer and for the unilateral decision to reduce petitioner's basic salary from US$800.00 to US$560.00. Petitioner was made to shoulder his return airfare to Manila. In the Philippines, petitioner filed with the Philippine Overseas Employment Administration(POEA for short), a complaint against

private respondent for payment of salary differential, overtime pay, unpaid salary for November, 1985 and refund of his return airfare and cash bond allegedly in the amount of P20,000.00 contending therein that private respondent unilaterally altered the employment contract by reducing his salary of US$800.00 per month to US$560.00,causing him to request for his repatriation to the Philippines. In resolving aforesaid case, the Officer-in-Charge of the Philippine Overseas EmploymentAdministration or POEA found that petitionercomplainant's total monthly emolument isUS$800.00 inclusive of fixed overtime as shown and proved in the Wage Scale submitted to the Accreditation Department of its Office which would therefore not entitle petitioner to any salary differential; that the version of complainant that there was in effect contract substitution has no grain of truth because although the Employment Contract seems to have corrections on it, said corrections or alterations are in conformity with the Wage Scale duly approved by the POEA; that the withholding of a certain amount due petitioner was justified to answer for his repatriation expenses which repatriation was found to have been requested by petitioner himself as shownin the entry in his Seaman's Book; and that petitioner deposited a total amount of P15,000.00only instead of P20,000.00 cash bond. Dissatisfied, both parties appealed the aforementioned decision of the POEA to the National Labor Relations Commission. Complainant-petitioner's appeal was dismissed for lack of merit while respondents' appeal was dismissed for having been filed out of time. Petitioner's motion for reconsideration was likewise denied. Hence this recourse. Issue: Whether or not POEA acted in excess of its jurisdiction? Decision: As clearly explained by respondent NLRC, the correction was made only to specify the salary and the overtime pay to which petitioner is entitled under the contract. It was a mere breakdown of the total amount into US$560.00 as basic wage and US$240.00 as overtime pay. Otherwise stated, with or without the amendments the total emolument that petitioner would receive under the agreement as approved by the POEA is US$800.00 monthly with wage differentials or overtime pay included. SEAGULL MARITIME CORP. VS BALATONGAN, NLRC & POEA G.R. NO. 82252 FEBRUARY 28, 1989 GANCAYCO, J. Facts: On November 2, 1982, a "crew Agreement" was entered into by private respondent Nerry D. Balatongan and Philimare Shipping and Equipment Supply (hereinafter called Philimare) whereby the latter employed the former as able

seaman on board its vessel "Santa Cruz" (renamed "Turtle Bay") with a monthly salary of US $ 300.00. Said agreement was processed and approved by the National Seaman's Board (NSB) on November 3, 1982. While on board said vessel and parties entered into a supplementary contract of employment on December 6, 1982 which provides among others: (1) The employer shall be obliged to insure the employee during his engagement against death or permanent invalidity caused by accident on board up to US $ 40,000 for death caused by accident and US $ 50,000 - for permanent total disability caused by accident. On October 6, 1983 Balatongan met an accident in the Suez Canal, Egypt as a result of which he was hospitalized at the Suez Canal Authority Hospital. Later, he was repatriated to the Philippines and was hospitalized at the Makati Medical Center from October 23, 1983 to March 27, 1984. On August 19, 1985 the medical certificate was issued describing his disability as "permanent in nature." Balatongan demanded payment for his claim for total disability insurance in the amount of US $ 50,000.00 as provided for in the contract of employment but his claim was denied for having been submitted to the insurers beyond the designated period for doing so. Thus, Balatongan filed on June 21, 1985 a complaint against Philimare and Seagull Maritime Corporation in the Philippine Overseas Employment Administration (POEA) for non-payment of his claim for permanent total disability with damages and attorney's fees. After the parties submitted their respective position papers with the corresponding documentary evidence, the officer-in-charge of the Workers Assistance and Adjudication Office of the POEA rendered for respondents to pay complainant the amount of US $ 50,000.00 representing permanent total disability insurance and attorney's fees at 10% of the award. Payment should be made in this Office within ten (10) days from receipt hereof at the prevailing rate of exchange. This Office cannot however rule on damages, having no jurisdiction on the matter. Seagull and Philimare appealed said decision to the National Labor Relations Commission (NLRC) on June 4, 1986. Hence, Seagull and Philimare filed this petition for certiorari with a prayer for the issuance of a temporary restraining order. Issue: W/N the supplementary contract of employment entered into between petitioners and respondent is a prohibited practice to afford greater benefits to the employee Held:

This Court is not a trier of facts and the findings of the public respondents are conclusive in this proceeding. Public respondents found that petitioner Philimare and private respondent entered into said supplementary contract of employment on December 6, 1982. Assuming for the sake of argument that it was petitioners' principal which entered into said contract with private respondent, nevertheless petitioner, as its manning agent in the Philippines, is jointly responsible with its principal thereunder. The Court finds that the respondent NLRC did not commit a grave abuse of discretion in denying petitioners, motion for leave to file third-party complaint and substitution inclusion of party respondent. Such motion is largely addressed to the discretion of the said Commission. Inasmuch as the alleged transfer of interest took place only after the POEA had rendered its decision, the denial of the motion so as to avoid further delay in the settlement of the claim of private respondent was well-taken. At any rate, petitioners may pursue their claim against their alleged successor-in-interest in a separate suit.   CATAN VS. NLRC G.R. NO. 77279 APRIL 15, 1988 CORTES, J. FACTS Petitioner, a duly licensed recruitment agency, recruited private respondent to work in Saudi Arabia as a steelman. The term of the contract provides for 1 year and with automatic renewal. It was renewed when private respondent was not repatriated by his Saudi employer but instead was assigned to work as a crusher plant operator and crushed his ankle by the machine he was operating. After the expiration of the renewed term, private respondent returned to the Philippines, had his ankle operated and incurred expenses. After, he returned to Saudi Arabia to resume his work and was repatriated. Upon his return, he had his ankle treated for which he incurred further expenses.2.On the basis of the provision in the employment contract that the employer shall compensate the employee if he is injured or permanently disabled in the course of employment, private respondent filed a claim, against petitioner with respondent Philippine Overseas Employment Administration. The POEA rendered judgment in favor of private respondent. On appeal, respondent NLRC affirmed the decision. Not satisfied with the resolution of the POEA, petitioner instituted the instant special civil action for certiorari, alleging grave abuse of discretion on the part of the NLRC. RULING 1.The court said that there is no merit in petitioner’s contention. A private employment agency may be sued jointly and solidarily with its foreign principal for violations of the recruitment agreement and the contracts of employment.

2.Even if indeed petitioner and the Saudi principal had already severed their agency agreement at the time private respondent was injured, petitioner may still be sued for a violation of the employment contract because no notice of the agency agreement's termination was given to the private respondent: 3.Petitioner contends that even if it is liable for disability benefits, the NLRC gravely abused its discretion when it affirmed the award of medical expenses when the said expenses were the consequence of private respondent's negligence in returning to work in Saudi Arabia when he knew that he was not yet medically fit to do so. 4z.The court said that there’s No evidence introduced to prove that private respondent was not medically fit to work when he returned to Saudi Arabia. Nowhere does it say it the medical certificate issued by the camp doctor that he was not medically fit to work. ROYAL CROWNE INTERNATIONAL VS. NLRC G.R. NO. 78085 OCTOBER 16, 1989 CORTES, J. FACTS: Petitioner, a duly licensed private employment agency, recruited and deployed private respondent Virgilio for employment with ZAMEL as an architectural draftsman in Saudi Arabia. Service agreement was executed by private respondent and ZAMEL whereby the former was to receive per month a salary of US$500.00 plus US$100.00 as allowance for a period of one year commencing from the date of his arrival in Saudi Arabia. However, ZAMEL terminated the employment of private respondent on the ground that his performance was below par. For three successive days thereafter, he was detained at his quarters and was not allowed to report to work until his exit papers were ready. On February 16, 1984, he was made to board a plane bound for the Philippines. Private respondent then filed a complaint for illegal termination against Petitioner Royal Crown Internationale and ZAMEL with the POEA. Petitioner contends that there is no provision in the Labor Code, or the omnibus rules implementing the same, which either provides for the "third-party liability" of an employment agency or recruiting entity for violations of an employment agreement performed abroad, or designates it as the agent of the foreign-based employer for purposes of enforcing against the latter claims arising out of anemployment agreement. Therefore, petitioner concludes, it cannot be held jointly and severally liable with ZAMEL for violations, if any, of private respondent's service agreement. ISSUE:

Whether or not petitioner as a private employment agencymay be held jointly and severally liable with the foreign-based employer for any claim which may arise in connection with the implementation of the employment contracts of the employees recruited and deployed abroad. HELD: Yes, Petitioner conveniently overlooks the fact that it had voluntarily assumed solidary liability under the various contractual undertakings it submitted to the Bureau of Employment Services. In applying for its license to operate a private employment agency for overseas recruitment and placement, petitioner was required to submit, among others, a document or verified undertaking whereby it assumed all responsibilities for the proper use of its license and the implementation of the contracts of employment with the workers it recruited and deployed for overseas employment. It was also required to file with the Bureau a formal appointment or agency contract executed by the foreign-based employer in its favor to recruit and hire personnel for the former, which contained a provisionempowering it to sue and be sued jointly and solidarily with the foreign principal for any of the violations of the recruitment agreement and the contracts of employment. Petitioner was required as well to post such cash and surety bonds as determined by the Secretary of Labor to guarantee compliance with prescribed recruitment procedures, rules and regulations, and terms and conditions of employment as appropriate. These contractual undertakings constitute the legal basis for holding petitioner, and other private employment or recruitment agencies, liable jointly and severally with its principal, the foreign-based employer, for all claims filed by recruited workers which may arise in connection with the implementation of the service agreements or employment contracts. FACILITIES MANAGEMENT CORPORATION VS. DE LA ROSA GR L-38649 MARCH 26, 1979 MAKASIAR, J. Facts: Facilities Management Corporation and J. S. Dreyer are domiciled in Wake Island while J. V. Catuira is an employee of FMC stationed in Manila. Leonardo dela Osa was employed by FMC in Manila, but rendered work in Wake Island, with the approval of the Department of Labor of the Philippines. De la Osa was employed as (1) painter with an hourly rate of $1.25 from March 1964 to November 1964, inclusive; (2) houseboy with an hourly rate of $1.26 from December 1964 to November 1965, inclusive; (3) houseboy with an hourly rate of $1.33 from December 1965 to August 1966, inclusive; and (4) cashier with an hourly rate of $1.40 from August 1966 to March 27 1967, inclusive. He further averred that from December, 1965 to August, 1966, inclusive, he rendered overtime services daily, and that this entire period was divided into swing and

graveyard shifts to which he was assigned, but he was not paid both overtime and night shift premiums despite his repeated demands from FMC, et al. In a petition filed on 1 July 1967, dela Osa sought his reinstatement with full backwages, as well as the recovery of his overtime compensation, swing shift and graveyard shift differentials. Subsequently on 3 May 1968, FMC, et al. filed a motion to dismiss the subject petition on the ground that the Court has no jurisdiction over the case, and on 24 May 1968, de la Osa interposed an opposition thereto. Said motion was denied by the Court in its Order issued on 12 July 1968. Subsequently, after trial, the Court of Industrial Relations, in a decision dated 14 February 1972, ordered FMC, et al. to pay de la Osa his overtime compensation, as well as his swing shift and graveyard shift premiums at the rate of 50% per cent of his basic salary. FMC, et al. filed the petition for review on certiorari.

Issue: Whether the mere act by a non-resident foreign corporation of recruiting Filipino workers for its own use abroad, in law doing business in the Philippines. Whether FMC has been "doing business in the Philippines" so that the service of summons upon its agent in the Philippines vested the Court of First Instance of Manila with jurisdiction. Held: In its motion to dismiss, FMC admits that Mr. Catuira represented it in the Philippines "for the purpose of making arrangements for the approval by the Department of Labor of the employment of Filipinos who are recruited by the Company as its own employees for assignment abroad." In effect, Mr. Catuira was alleged to be a liaison officer representing FMC in the Philippines. Under the rules and regulations promulgated by the Board of Investments which took effect 3 February 1969, implementing RA 5455, which took effect 30 September 1968, the phrase "doing business" has been exemplified with illustrations, among them being as follows: ""(1) Soliciting orders, purchases (sales) or service contracts. Concrete and specific solicitations by a foreign firm, not acting independently of the foreign firm, amounting to negotiation or fixing of the terms and conditions of sales or service contracts, regardless of whether the contracts are actually reduced to writing, shall constitute doing business even if the enterprise has no office or fixed place of business in the Philippines; (2) appointing a representative or distributor who is domiciled in the Philippines, unless said representative or distributor has an independent status, i.e., it transacts business in its name and for its own account, and not in the name or for the account of the principal; xxx (4) Opening offices, whether called 'liaison' offices, agencies or branches, unless proved otherwise. xxx (10) Any other act or acts that imply a continuity of commercial dealings or arrangements, and contemplate to that extent the performance of acts or works, or the exercise of some of the functions normally

incident to, or in the progressive prosecution of, commercial gain or of the purpose and objective of the business organization." FMC may be considered as "doing business in the Philippines" within the scope of Section 14 (Service upon private foreign corporations), Rule 14 of the Rules of Court which provides that "If the defendant is a foreign corporation, or a nonresident joint stock company or association, doing business in the Philippines, service may be made on its resident agent designated in accordance with law for that purpose or, if there be no such agent, on the government official designated by law to that effect, or on any of its officers or agents within the Philippines." Indeed, FMC, in compliance with Act 2486 as implemented by Department of Labor Order IV dated 20 May 1968 had to appoint Jaime V. Catuira, 1322 A. Mabini, Ermita, Manila "as agent for FMC with authority to execute Employment Contracts and receive, in behalf of that corporation, legal services from and be bound by processes of the Philippine Courts of Justice, for as long as he remains an employee of FMC." It is a fact that when the summons for FMC was served on Catuira he was still in the employ of the FMC. Hence, if a foreign corporation, not engaged in business in the Philippines, is not barred from seeking redress from courts in the Philippines (such as in earlier cases of Aetna Casualty & Surety Company, vs. Pacific Star Line, etc. [GR L-26809], In Mentholatum vs. Mangaliman, and Eastboard Navigation vs. Juan Ysmael & Co.), a fortiori, that same corporation cannot claim exemption from being sued in Philippine courts for acts done against a person or persons in the Philippines. PEOPLE VS. CHOWDURY G.R. NO. 129577-80 FEBRUARY 15, 2000 PUNO, J. Facts: Bulu Chowdury was charged with the crime of illegalrecruitment in large scale by recruiting Estrella B. Calleja, Melvin C. Miranda and Aser S. Sasis for employment in Korea. Evidence shows that accused –appellant interviewed private complainant in 1994 at Craftrade’s office. At that time, he was an interviewer of Craftrade which was operating under temporary authority given by POEA pending the renewal of license. He was charged based on the fact that he was not registered with the POEA as employee of Craftrade and he is not in his personal capacity, licensed to recruit overseas workers. The complainants also averred that during theirapplications for employment for abroad, the license of Craftrade was already expired. For his defense Chowdury testified that he worked as interviewer at Craftrade from 1990 until 1994. His primary duty was to interview job applicants for abroad. As a mere employee, he only followed the instructions given by his superiors, Mr. Emmanuel Geslani, the agency's President and General Manager, and Mr. UtkalChowdury, the agency's Managing Director.

Issue: Whether or not accused-appellant knowingly and intentionally participated in the commission of the crime charged. Held: No, an employee of a company or corporation engaged in illegal recruitment may be held liable as principal, together with his employer, if it is shown that he actively and consciously participated in illegal recruitment. In this case, Chowdury merely performed his tasks under the supervision of its president and managing director. The prosecution failed to show that the accused-appellant is conscious and has an active participation in the commission of the crime of illegal recruitment. Moreover, accused-appellant was not aware of Craftrade's failure to register his name with the POEA and the prosecution failed to prove that he actively engaged inrecruitment despite this knowledge. The obligation to register its personnel with the POEA belongs to the officers of the agency. A mere employee of the agency cannot be expected to know the legalrequirements for its operation. The accused-appellant carried out his duties as interviewer of Craftrade believing that the agency was duly licensed by the POEA and he, in turn, was duly authorized by his agency to deal with the applicants in its behalf. Accused-appellant in fact confined his actions to his job description. He merely interviewed the applicants and informed them of the requirements fordeployment but he never received money from them. Chowdury did not knowingly and intentionally participated in the commission of illegal recruitment being merely performing his task and unaware of illegality of recruitment. PEOPLE V. NELLIE CABAIS Y GAMUELA G.R. NO. 129070 MARCH 16, 2001. FACTS Accused was convicted of illegal recruitment committed in large scale by a syndicate, and sentenced to life imprisonment and a fine. She was also convicted for two counts of estafa, and sentenced to (a) in Criminal Case No. 13999-R, to six (6) months and one (1) day of prision correccional, as minimum, to seven (7) years, eight (8) months and twenty-one (21) days of prision mayor, as maximum, and to indemnify the offended party Joan Merante, in the amount of P40,000.00 as actual damages, and costs; (b) in Criminal Case No. 14000-R, to six (6) months and one (1) day of prision correccional, as minimum, to six (6) years, eight (8) months and twenty (20) days of prision mayor, as maximum, and to indemnify the offended party, Nancy Oidi, in the amount of P21,000.00 as actual damages, and costs. HELD: The essential elements of illegal recruitment committed in large scale are: (1) that the accused engaged in acts of recruitment and placement of workers as defined under Article 13 (b) or in any prohibited activities under Article 34 of the Labor Code; (2) that the accused had not complied with the guidelines issued by the Secretary of Labor and Employment, particularly with respect to the requirement to secure a license or an authority to recruit and deploy workers, either locally or

overseas; and (3) that the accused committed the unlawful acts against three (3) or more persons, individually or as a group. Accused-appellant contends that she was not involved in recruitment but was merely an employee of a recruitment agency. An employee of a company or corporation engaged in illegal recruitment may be held liable as principal, together with his employer, if it is shown that he actively and consciously participated in illegal recruitment. In this case, accused was the one who informed complainants of job prospects in Korea and the requirements for deployment. She also received money from them as placement fees. All of the complainants testified that they personally met accused-appellant and transacted with her regarding the overseas job placement offers. Complainants parted with their money, evidenced by receipts signed by accused Cabais and accused Forneas. Thus, accused-appellant actively participated in the recruitment of the complainants. Furthermore, accused-appellant did not possess any license to engage in recruitment activities, as evidenced by a certification from the POEA and the testimony of a representative of said government agency. Her acts constituted recruitment, and considering that she admittedly had no license or authority to recruit workers for overseas employment, accused-appellant is guilty of illegal recruitment. Despite the fact that she was just an ordinary employee of the company, her criminal liability would still stand for being a conspirator with the corporate officers in undertaking illegal recruitment activities. Since the recruitment involves three or more persons, accused-appellant is guilty of illegal recruitment in a large scale punishable under Article 39 of the Labor Code with life imprisonment and a fine of one hundred thousand pesos. As to the charges of estafa, accused-appellant contends that she is not liable for the offenses charged because she did not appropriate for her own use the money given to her by complainants as placement and passport fees. The elements of estafa are: (a) that the accused defrauded another by abuse of confidence or by means of deceit, and (b) that damage or prejudice capable of pecuniary estimation is caused to the offended party or third person. From the foregoing, the fact that the money was appropriated by accused for her own use is not an element of the crime of estafa. Thus, accused-appellant Cabais’ contention under such ground is untenable. Moreover, accused-appellant misrepresented herself to complainants as one who can make arrangements for job placements in Korea. Complainants were successfully induced to part with their money, causing them damage and prejudice. Consequently, accused-appellant is guilty of estafa. PEOPLE OF THE PHILIPPINES VS. LUZ GONZALES-FLORES G.R. NO. 138535-38 APRIL 19, 2001 MENDOZA, J. Facts:

The accused, conspiring together, confederating with several persons whose true names and whereabouts have not as yet been ascertained and helping one another, did then and there wilfully, unlawfully and feloniously defraud LARRY TIBOR Y MABILANGAN in the following manner, to wit: the said accused, by means of false manifestations and fraudulent representations which they made to said complainant to the effect that they had the power and capacity to recruit and employ complainant abroad as [a] seaman and could facilitate the processing of the pertinent papers if given the necessary amount to meet the requirements thereof, and by means of other similar deceits, induced and succeeded in inducing said complainant to give and deliver, as in fact gave and delivered to said accused the amount of P38,000.00 on the strength of said manifestations and representations, said accused well knowing that the same were false and fraudulent and were made solely to obtain, as in fact they did obtain the amount of P38,000.00 which amount once in possession, with intent to defraud LARRY TIBOR Y MABILANGAN wilfully, unlawfully and feloniously mis-appropriated misapplied and converted to their own personal use and benefit) to the damage and prejudice of said complainant in the amount of P38,000.00, Phi1ippine Currency. On the other hand, in Criminal Case No. Q-94-59473, the information for illegal recruitment in large scale charged: That on or about the month of August, 1994, in Quezon City, Philippines, the said accused, conspiring together, confederating with several persons whose true names and whereabouts have not as yet been ascertained and helping one another, did then and there, wilfully, unlawfully and feloniously canvass, enlist, contract and promise employment to the following persons, to wit: RONALD F[R]EDERI[Z]O Y HlJSENIA LARRY TIBOR Y MABILANGAN FELIXBERTO LEONGSON, JR. y CASTANEDA after requiring them to submit certain documentary requirements and exacting from them the total amount of P128,000,00 Philippine Currency as recruitment fees such recruitment activities being done without the required license or authority from the Department of Labor. That the crime described above is committed in large scale as the same was perpetrated against three (3) or more persons individually or as group as penalized under Articles 38 and 39) as amended by P.D. 2018, of the Labor Code.6 That night, accused-appellant came to see Felixberto and reiterated her proposal. Felixberto said he wanted the job but he only had P10,000.00. Accused-appellant told him the amount would be sufficient as an initial payment. Accused-appellant came back with Joseph Mendoza, whose brother-in-Iaw, Engr. Leonardo Domingo, according to accused- appellant, was recruiting seamen. Thereafter, accused-appellant and Mendoza took complainant, Cloyd, and Jojo's wife, Clarita, to a house on Second Street, near Camp Crame in Quezon City, where the latter were introduced to Andy Baloran.7 Complainant and his

companions were told that Baloran was an employee of the National Bureau of Investigation and he would take care of processing the applications for employment. Baloran told complainant and the other job applicants that those who would be employed would be paid a monthly salary of US$ l,000.00, plus tips, and given vacation leaves of 45 days with pay. Baloran asked complainant to submit his picture, bio-data, and birth certificate, which complainant later did. Accused-appellant then asked complainant to give her the P10,000.00 as initial payment. Complainant handed her the money and asked for a receipt, but accused-appellant told him not to worry and assured him that she would be responsible if anything untoward happened. Complainant, therefore, did not insist on asking accused-appellant for a receipt. Accused-appellant said she gave the money to Baloran. Two days later, Baloran and Domingo went to the compound where Felixberto and accused-appellant were residing and called Felixberto, Cloyd, and Jojo to a meeting. Domingo told the applicants that he was the chief engineer of the luxury ocean liner where they would embark and repeated to them the salaries and other benefits which they would receive. He told them not to get impatient. Accused-appellant later saw complainant to collect the balance of P35,000.00. Complainant was told to give the money to accused-appellant at Wendy's in Cubao, Quezon.City on August 12, 1994. At the appointed date and place, complainant and his wife delivered the amount to accused-appellant who, in turn, handed it to Baloran. No receipt was, however, issued to Felixberto. Another meeting was held on August 16, 1994 at the Mandarin Hotel in Makati City by accused-appellant, Domingo, Baloran, Mendoza, the Leongson spouses, the Malgapo spouses, and Jojo Bumatay. The applicants were told by Domingo that they would be employed as waiters and attendants in the luxury liner and asked them again to wait a while. On August 18, 1994, accused-appellant saw complainant again to collect the P 25,000.00 balance. Felixberto paid the amount to accused- appellant four days later. As in the case of the first two payments, no receipt was given for the P25,000.00. Accused-appellant told him that she would turn over the amount to Baloran. Although complainant regularly followed up his application with accused-appellant, he was told each time to have patience and to just wait for the call from Domingo or from Baloran. But Felixberto never heard from either one of these two. Issue: Whether the accused is guily of illegal recruitment. Held: Yes. In these cases, according to the certification of the POEA, accused-appellant had no license or authority to engage in any recruitment activities. In fact, this

was stipulated at the trial. Accused-appellant claims, however, that she herself was a victim of illegal recruitment and that she simply told complainants about job opportunities abroad. The allegation is untenable. Art. 13 (b) of the Labor Code defines "recruitment and placement" as referring to any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not. The same article further states that any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement. The evidence for the prosecution shows that accused-appellant sought out complainants and promised them overseas employment. Despite their initial reluctance because they lacked the technical skills required of seamen, complainants were led to believe by accused-appellant that she could do something so that their applications would be approved. Thus, because of accused-appellant's misrepresentations, complainants gave her their moneys. Accused-appellant's companions, Domingo, Baloran, and Mendoza, made her ploy even more plausible. PEOPLE V. SAGAYDO G.R. NOS. 124671-75 SEPTEMBER 29, 2000 PARDO, J. Facts: The accused appellant made representations to each of the private complainants that she could send them to Korea to work as factory workers, constituting a promise of employment which amounted to recruitment as defined under Article 13 (b) of the Labor Code. The accused denied having recruited any of the private complainants. She claimed that they came to her voluntarily after being informed that she was able to send her three sons to Korea. Issue: Whether or not Linda Sagaydo is guilty of illegal recruitment. Held: From the testimonies of the private complainants that the trial court found to be credible and untainted with improper motives, there is no denying that accused-appellant gave the complainants the distinct impression that she had the power or ability to send them abroad for work such that the latter were convinced to part with their money in order to be employed. As against the positive and categorical testimonies of the complainants, mere denial of accusedappellant cannot prevail. As to the license requirement, the record showed that accused-appellant did not have the authority to recruit for employment abroad, per certification issued by the POEA Regional Extension Unit in Baguio City.

Illegal recruitment has been defined to include the act of engaging in any of the activities mentioned in Article 13 (b) of the Labor Code without the required license or authority from the POEA. Under the aforesaid provision, any of the following activities would constitute recruitment and placement: canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, including referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not. Article 13 (b) further provides that any person or entity which, in any manner, offers or promises for a fee employment to two (2) or more persons shall be deemed engaged in recruitment and placement. Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons, individually or as a group. “This crime requires proof that the accused: (1) engaged in the recruitment and placement of workers defined under Article 13 or in any of the prohibited activities under Article 34 of the Labor Code; (2) does not have a license or authority to lawfully engage in the recruitment and placement of workers; and (3) committed the infraction against three or more persons, individually or as a group. The absence of receipts cannot defeat a criminal prosecution for illegal recruitment. As long as the witnesses can positively show through their respective testimonies that the accused is the one involved in prohibited recruitment, he may be convicted of the offense despite the absence of receipts. PEOPLE V BENZON ONG G. R. NO. 119594 JANUARY 18, 2000 MENDOZA, J. Facts: Accused, representing himself to have the capacity to contract, enlist, hire and transport Filipino workers for employment abroad, did then and there willfully, unlawfully and feloniously, for a fee, recruit and promise employment/job placement to the nine complainants in Taiwan, without first obtaining or securing license or authority from the proper governmental agency. Accused-appellant claims that when complainants filled out their respective biodata, application forms and other documents for employment in Taiwan, they knew that they were applying for employment abroad through the Steadfast Recruitment Agency. He claims that he merely suggested to them the opportunity to work overseas but that he never advertised himself as a recruiter. Accused-appellant denies that the signatures in the receipts of payments are his. To be sure, the presentation of the receipts acknowledging payments is not necessary for the successful prosecution of accused-appellant. Accused-appellant contends that the elements of estafa have not been proven by the prosecution, specifically, the requirement that complainants must have relied

on the false pretenses of accused-appellant, because complainants knew that he was not a licensed recruiter. Issue: Whether or not Benzon Ong committed the crime of illegal recruitment Held: To prove illegal recruitment, it must be shown that the accused-appellant gave complainants the distinct impression that he had the power or ability to send complainants abroad for work such that the latter were convinced to part with their money in order to be employed Illegal recruitment is considered an offense involving economic sabotage if any of these qualifying circumstances exist, namely, (a) when illegal recruitment is committed by a syndicate, i.e., if it is carried out by a group of three or more persons conspiring and/or confederating with one another; or, (b) when illegal recruitment is committed in large scale, i.e., if it is committed against three or more persons individually or as a group. The essential elements of the crime of illegal recruitment in large scale are: (1) the accused engages in acts of recruitment and placement of workers defined under Art. 13(b) or in any prohibited activities under Art. 34 of the Labor Code; (2) the accused has not complied with the guidelines issued by the Secretary of Labor and Employment, particularly with respect to the securing of a license or an authority to recruit and deploy workers, either locally or overseas; and (3) the accused commits the unlawful acts against three or more persons, individually or as a group. As defined, a "license" is that which is issued by the Department of Labor and Employment authorizing a person or entity to operate a private employment agency, while an "authority" is that issued by the DOLE entitling a person or association to so engage in recruitment and placement activities as a private recruitment agency. It is the lack of the necessary license or authority that renders the recruitment unlawful or criminal. The evidence shows that he made misrepresentations to them concerning his authority to recruit for overseas employment and collected various amounts from them for placement fees. Clearly, accused-appellant committed acts constitutive of large scale illegal recruitment. He was positively identified by complainants as the person who had recruited them for employment in Taiwan. He succeeded in inveigling them into paying various amounts to him for their placement fees. Their testimonies dovetail with each other in material points Moreover, it is settled that a person who is convicted of illegal recruitment may, in addition, be convicted of estafa under Art. 315(2)(a) of the Revised Penal Code. There is no problem of double jeopardy because illegal recruitment is malum prohibitum, in which the criminal intent is not necessary, whereas estafa is malum in se in which the criminal intent of the accused is necessary. PEOPLE V. CALONZO G.R. NOS. 115150-55 SEPTEMBER 27, 1996 BELLOSILLO, J.

Facts: Firstly, he deluded complainants into believing that jobs awaited them in Italy by distinctly impressing upon them that he had the facility to send them for work abroad. He even showed them his passport to lend credence to his claim. To top it all, he brought them to Bangkok and not to Italy. Neither did he have any arrangements in Bangkok for the transfer of his recruits to Italy. Secondly, POEA likewise certified that neither Calonzo nor R. A. C. Business Agency was licensed to recruit workers for employment abroad. Appellant admitted this fact himself. Thirdly, appellant recruited five (5) workers thus making the crime illegal recruitment in large scale constituting economic sabotage. Complainants were all united in pointing to the Calonzo as the person who enticed them to apply for employment abroad. Of course, Calonzo could not explain what motivated the complaining witnesses to file these cases against him. The most that Calonzo could do on the witness stand was to deny all the charges against him. Alas, his denial is at most lame and cannot prevail over the positive assertions of the complaining witnesses. Issue: Whether or not Calonzo committed illegal recruitment in large scale. Held: Article 13, par. (b), of the Labor Code defines recruitment and placement as – (A)ny act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not; Provided, that any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement. Illegal recruitment is specifically defined in Art. 38 of the Code thus Any recruitment activities, including the prohibited practices enumerated under Article 34 of this Code, to be undertaken by non-licensees or non-holders of authority shall be deemed illegal and punishable under Article 39 of this Code x x xx Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense involving economic sabotage and shall be penalized in accordance with Article 39 hereof. Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme defined under the first paragraph hereof. Illegal recruitment is deemed committed in large scale if committed against three (3) or more persons individually or as a group. The absence of evidence as to an improper motive actuating the principal witnesses of the prosecution strongly tends to sustain no improper motive existed and their testimony is worthy of full faith and credit. Accused-appellant's denial

cannot prevail over the positive assertions of complainants who had no motive to testify falsely against her except to tell the truth. Calonzo defrauded complainants through deceit. They were obviously misled into believing that he could provide them employment in Italy. As a result, the five (5) complainants who desperately wanted to augment their income and improve their lot parted with their hard-earned money. PEOPLE V. DE REICHL PEOPLE OF THE PHILIPPINES, PLAINTIFF-APPELLEE, VS. FRANCISCO HERNANDEZ (AT LARGE), KARL REICHL, AND YOLANDA GUTIERREZ DE REICHL, ACCUSED. KARL REICHL AND YOLANDA GUTIERREZ DE REICHL, ACCUSEDAPPELLANTS. G.R. NOS. 141221-36 MARCH 7, 2002 PUNO, J. Facts: In April 1993, eight informations for syndicated and large scale illegal recruitment and eight informations for estafa were filed against accusedappellants, spouses Karl and Yolanda Reichl, together with Francisco Hernandez. Only the Reichl spouses were tried and convicted by the trial court as Francisco Hernandez remained at large. The complainants namely, Narcisa Autor de Hernandez, Leonora Perez, Melanie Bautista Annaliza Perez, Edwin Coling, Estela Abel de Manalo, Anicel Umahon and Charito Balmes have their own similar stories about the illegal recruitment conducted by the accused-appellants. They recounted that accused Hernandez was the one convincing each of them to apply for employment abroad. Accused Hernandez asked for the payment for the processing of their papers, travel documents and visas. Complainants then were introduced by Hernandez to spouse Reichl who in turn promised them for employment abroad. The spouse issued reciept for the payments made by the complainants. The promises of employment however did not pushed through and the complainants remained in the Philippines. Upon demands, the accused spouse promise them to refund the payment if their employments never materialized. These agreements were reduced into a document but the accused spouse never complies with their obligations. There was also a certification from the Philippine overseas employment Administration (POEA) that Francisco Hernandez, Karl Reichl and Yolanda Gutierrez Reichl in their personal capacities were neither licensed nor authorized by the POEA to recruit workers for overseas employment. As for their part, the spouse denied any of involvement of Hernandez's recruitment and their knowledge of promises for overseas employment. They further contended that they cannot be convicted of illegal recruitment committed in large scale as the several information were only filed by single complainant.

Issue: Whether or not the accused-appellants were guilty of syndicated and large scale illegal recruitment. Held: They cannot be convicted of illegal recruitment committed in large scale. Where only one complainant filed individual complaints as in this case, there is no illegal recruitment in large scale. However, they are guilty of syndicated illegal recruitment. Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more persons conspiring and/or confederating with one another in carrying out any unlawful or illegal transaction, enterprise or scheme defined under the first paragraph of Article 38 of the Labor Code. It has been shown that Karl Reichl, Yolanda Reichl and Francisco Hernandez conspired with each other in convincing private complainants to apply for an overseas job and giving them the guaranty that they would be hired as domestic helpers in Italy although they were not licensed to do so. Thus, the accused appellants are liable for illegal recruitment committed by a syndicate. PEOPLE V. TOMMY TAN G.R. NO. 153460 JANUARY 29, 2007 PADILLA, J. Facts: Accused-appellant Tan Tiong Meng alias “Tommy Tan” was charged and convicted with illegal recruitment in large scale and 6 counts of estafa before the regional trial court of cavity city. The complainants namely: Ernesto Orcullo, Manuel Latina, Neil Mascardo, Librado C. Pozas, EdgardoTolentino and Cavino Asiman have similar stories about the illegal recruitment activities of the accused. Each of them recounted that they were informed of job employment in Taiwan. The transactions happened in certain house of Borja where the accused-appellant assured the complainants of employment at Rainbow Ship Co.. They were asked to pay a certain amount for placement and processing fees. The accused issued receipts. The promise of employment however did not push through and the complainants decided to file a complaint for illegal recruitment. They later found out that the accused-appellant was not a licensed overseas recruiter. Issue: Whether or not the accused-appellant was guilty of illegal recruitment in large scale. Held: Yes, the Labor Code defines recruitment and placement as any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit or not; Provided, that any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement. It is clear that accused - appellant's acts of accepting placement fees from job applicants and representing to said applicants that he could get them jobs in

Taiwan constitute recruitment and placement under the above provision of the Labor Code. The accused was not also licensed by the POEA and thus making him an illegal recruiter. Moreover, illegal recruitment is deemed committed in large scale if committed against three or more persons individually or as a group. In this case, the accused- appellant committed illegal recruitment in large scale for having recruited six complainants. PEOPLE V ARABIA AND TOMAS G.R. NO. 138431-36 SEPTEMBER 12, 2001 GONZAGA-REYES, J. Facts: Sometime in the month of October, 1992, in Quezon City, Philippines, the said accused, conspiring together, confederating with and mutually helping each other, did then and there willfully, unlawfully and feloniously defraud Rolando Rustia by means of false manifestations and fraudulent representation which they made him to the effect that they had the power and capacity to recruit and employ him and could facilitate the processing of the pertinent papers if given the necessary amount to meet the requirements thereof, and by means of other similar deceits, induced and succeeded in inducing said Rolando Rustia to give and deliver, as in fact he gave and delivered to said accused the amount of P23,000.00 on the strength of said manifestations and representations, said accused well knowing that the same were false and fraudulent and were made solely to obtain, as in fact they did obtain the amount of P23,000.00, which amount once in possession, with intent to defraud Rolando Rustia, willfully, unlawfully and feloniously misappropriated, misapplied and converted to their own personal use and benefit, to the damage and prejudice of said Rolando Rustia in the aforesaid amount of P23,000.00, Philippine Currency. Private complainants were not able to leave for Taiwan because appellants told them that the person who was supposed to accompany them to Taiwan did not arrive. The departure date was thus reset to January 16, 1993, but private complainants were still unable to leave because of the same excuse that appellants gave. Private complainants asked for the return of their money as they were no longer interested in working abroad. They were informed by Arabia’s sister, however, that appellants were arrested by the NBI and detained at the Quezon City Jail. Records also showed that appellants were neither licensed nor authorized to recruit workers for overseas employment Issue: Whether or not the Arabia and Tomas are guilty of the crime charged. Held: Undoubtedly, accused Arabia and Tomas were engaged in recruiting workers for employment abroad and the only defense they have is denial. Largescale illegal recruitment has the following essential elements:The accused

undertook recruitment activity defined under Article 13 or any prohibited practice under Art. 34 of the Labor Code, he did not have the license or the authority to lawfully engage in the recruitment and placement of workers and he committed the same against three or more persons, individually or as a group. These essential elements are present in this case. Accused-appellants recruited at least four persons, giving them the impression that they had the capability to send them to Taiwan for employment. They collected various amounts allegedly for recruitment and placement fees without license or authority to do so. It is settled that the fact that an accused in an illegal recruitment case did not issue the receipts for amounts received from the complainants has no bearing on his culpability so long as complainants show through their respective testimonies and affidavits that the accused was involved in the prohibited recruitment. Thus, the accused-appellants were guilty of illegal recruitment in large scale. PEOPLE V VERANO G.R. NO. 110109 NOVEMBER 21, 1996 ROMERO, J. Facts: Sometime in October 1987, Verano while at her residence at Sta. Ana Manila informer her cousin Alfonso and the latter’s friends Joe and Arturo that she was recruiting salesmen for employment in Bahrain. Accused asked him to pay for various expenses and fees including cost of processing of travel papers, cost of plane tickets, medical examination and recruitment fees. Complainants Alfonso, Jose and Arturo paid the total installments covered by receipts signed by the accused. Afterwards, accused promised that they could depart for Bahrain for their promised employment. For three times on various dates, the complainants proceeded to the Manila International airport and waited for the accused to deliver their plane tickets, passports, and visas before their supposed flight to Bahrain, but the accused failed to deliver them. This prompted them to go to WPD headquarters to lodge their complaint. Despite verbal demands from the three complainants, the accused failed to return the amounts paid to her. It appeared from the records of the POEA that the accused was not a licensed labor recruiter. Issue: Whether Verano is guilty of illegal recruitment in large scale Held: The court found the accused guilty beyond reasonable doubt of the crime illegal recruitment in large scale and sentenced her to suffer the penalty of life imprisonment to pay fine of P100,000 and ordered to pay the offended parties, Arturo and Alfonso plus interest at the legal rate from February 22, 1988, the date of the filing of the information. In addition to the foregoing, the accused was also found guilty beyond reasonable doubt of the crime estafa.

PEOPLE V. ESPANOL G.R. NO. 105676 APRIL 10, 1996 KAPUNAN, J. Facts: In or abour February or August 1988, at Quezon city, accused Espanol canvassed, enlisted, contracted and promised employment to 14 persons, exacting total of P21,500 as recruitment fees without authority or license from the POEA. Accused introduced himself to 14 private complainants as one who had rich and influential relatives in California, USA. The positions promised were for a dressmaker, cook, dishwasher, driver and housemaid. And accused exacted payments for processing of travel documents in amounts ranging from P1,000P3,000. On several occasions, complainants talked to the accused, who kept promising that he could send them to abroad. When the complainants sensed that they were deceived, they demanded the return of the money, but accused failed and started hiding. They chanced on him and forcibly took him to the police station where they gave their sworn statements. Accused’s defense was that he did not know the applicants except one, that he had no brother or sister in CA, USA. Held: The accused is a dangerous member of society who feels happy and comfortable victimizing the poor, innocent and the gullible of their hard-earned money. Evidence woven together proves the pattern of illegal recruitment, hence mere denial must necessarily fall. The court found the accused guilty beyond reasonable doubt of the crime charged and sentenced him to suffer eight years imprisonment and to pay a fine and likewise aksed to reimburse sum of P21,500 to the 14 private complainants. PEOPLE V. ROXAS G.R. NO. 140762 SEPTEMBER 10, 2003 VITUG, J. Facts: Accused FC Roxas, doing business under the name and style of FC Roxas Construction, with office address at Rm. 212 Manufacturers Building, Sta Cruz, Manila, was a licensed private recruitment entity (Service contractor) whose authority was issued on February 20, 1984 and expired on March 25, 1988. (A service contractor acts as the employer of its recruits with respect to projects it contracted to service abroad). As a service contractor, it is not allowed to charge, directly or indirectly, any fee from the workers except the authorized documentation fee of P1,500.

During the period of January 1984 to july 1986, the accused FC Construtction Co. demanded and received from its applicants, herein private complainants numbering about 22, various sums of money ranging from P1,500 to P8,500 in excess of the limits set forth by law. The complainants, furthermore, were not able to work abroad, were no able to issue travel documents and despite efforts, were not refunded the money paid to and received by the accused. The accused Roxas did not deny the receipts covering the different sums of money paid by the private complainants. He reasoned out that the amount paid to and received by him were for “passporting and ticketing” of the private complainants Issue: Whether or not the accused is guilty of illegal recruitment. Held: The court found that the excuse of the accused to be highly unjustified and definitely unconvincing. Besides the accused has jumped bail, and despite the issuance of the warrant of arrest, he has not been apprehended. As a matter of fact, he was tried in absentia. The fundamental rule that the plight of the accused is consistent with his guilt was made applicable to his case. Accused is thereby guilty in violation of Article 32 of Labor Code; Fees to be paid by workers. - Any person applying with a private fee-charging employment agency for employment assistance shall not be charged any fee until he has obtained employment through its efforts or has actually commenced employment. Such fee shall be always covered with the appropriate receipt clearly showing the amount paid. The Secretary of Labor shall promulgate a schedule of allowable fees. PEOPLE V. REMULLO G.R. NOS. 124443-46 JUNE 6, 2002 QUISUMBING, J. Facts: Nimfa Remullo by means of false pretenses and fraudulent representation made prior to or with the commission of the fraud, with intent to defraud the complainant to the effect that she would send her to abroad for the purpose of employment and would need certain amount for the expenses in the processing of papers thereof, which representations the accused well knew was false and fraudulent and was only made by her to induce said complainant to give and pay, as in fact the latter gave and paid her to the amount of P15,000which the accused once in possession of the said amount would appropriate and convert to her own personal use and benefit, to the damage and prejudice of the complainant. Other complainants averred that they went to appellant’s house sometime in 1993 where they were told that she was recruiting for factory workers in Malaysia.

They were asked to fill up forms and go to the office of Jamila and Co., the recruimtnet agency where Remullo worked, in addition, she even asked them to submit a passport, pictures and clearance from the NBI and then undergo medical examination and a placement fee which the appellant did not provide an official receipt. Upon the scheduled flight, the complainants weren’t able to get on it and they were told by Remullo that they lacked requirement imposed by POEA. Their passports were cancelled and marked ‘offloaded’ as it was also marked as for tourists only. Private complainant Mejia inquired to Jamila and Co and found out that Remullo did not submit any papers to their office and further certified that she was not authorized to receive payments in behalf of the agency. Issue: whether or not Remullo is guilty of the crime charged against her. Held: Article 13 (b) of the Labor Code provides: ART. 13. Definitions. – xx “Recruitment and placement” refers to any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contact services, promising or advertising for employment, locally or abroad, whether for profit or not: Provided, That any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement. The court is convinced that private complainants, the main witnesses for the prosecution, were enticed by appellant to apply for jobs abroad. The three private complainants filled up application forms at appellant’s house, and each paid appellant the amount of P15,000 as placement fee. However, she acted without license or lawful authority to conduct recruitment of workers for overseas placement. The POEA’s licensing branch issued a certification stating that appellant, in her personal capacity, was not authorized to engage in recruitment activities. Evelyn Landrito, general manager of the placement agency where appellant used to work, denied that the scope of appellant’s work included recruiting workers and receiving placement fees. Such lack of authority to recruit is also apparent from a reading of the job description of a marketing consultant, the post that appellant occupied at Jamila and Co. In the face of evidence pointing to her wrongdoing, appellant only offers denials, while pointing to an alleged ill motive on the part of private complainants that prompted them to testify against her. According to appellant, private complainants failed to find the responsible parties, namely Steven Mah and his companion Lani Platon, and so are now going after her. Appellant’s arguments fail to persuade us of her innocence. The defense of denial is intrinsically weak, a self-serving negative evidence that cannot prevail over the testimony of credible witnesses who testified on affirmative matter.

Anent appellant’s conviction for estafa in Criminal Cases Nos. 95-654 to 95-656, we find no error committed by the trial court. Their conviction and sentence are fully supported by the evidence on record. For charges of estafa to prosper, the following elements must be present: (1) that the accused defrauded another by abuse of confidence or by means of deceit, and (2) that damage or prejudice capable of pecuniary estimation is caused to the offended party or third person. In this case, appellant clearly defrauded private complainants by deceiving them into believing that she had the power and authority to send them on jobs abroad. By virtue of appellant’s false representations, private complainants each parted with their hard-earned money. Each complainant paid P15,000 as recruitment fee to appellant, who then appropriated the money for her own use and benefit, but failed utterly to provide overseas job placements to the complainants. In a classic rigmarole, complainants were provided defective visas, brought to the airport with their passports and tickets, only to be offloaded that day, but with promises to be booked in a plane flight on another day. The recruits wait in vain for weeks, months, even years, only to realize they were gypped, as no jobs await them abroad. No clearer cases of estafa could be imagined than those for which appellant should be held criminally responsible. PEOPLE V. ANGELES G.R. NO. 132376 APRIL 11, 2002 YNARES-SANTIAGO, J. Facts: Maria Tolosa Sardeña was working in Saudi Arabia when she received a call from her sister, Priscilla Agoncillo, who was in Paris, France. Priscilla advised Maria to return to the Philippines and await the arrival of her friend, accused-appellant Samina Angeles, who will assist in processing her travel and employment documents to Paris, France. Heeding her sister’s advice, Maria immediately returned to the Philippines. Marceliano Tolosa who at that time was in the Philippines likewise received instructions from his sister Priscilla to meet accused-appellant who will also assist in the processing of his documents for Paris, France. Although Samina did not deceive complainants into believing that she could find employment for them abroad, nonetheless, she made them believe that she was processing their travel documents and parted with their money believing also that it would be used to pay plane tickets, hotel accommodations and other travel requirements. Issue: Whether or not Angeles is guilty with four (4) counts of estafa and one (1) count of illegal recruitment. Held: Accused-appellant posits that the prosecution did not present a single evidence to prove that she promised or offered any of the complainants jobs abroad. Illegal recruitment is committed when two (2) elements concur: 1) that

the offender has no valid license or authority required by law to enable one to lawfully engage in recruitment and placement of workers; and 2) that the offender undertakes either any activity within the meaning of recruitment and placement defined under Article 13(b), or any prohibited practices enumerated under Article 34. Article 13(b), of the Labor Code provides, thus: (b) “Recruitment and placement” refers to any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes referrals, contract services, promising or advertising for employment locally or abroad, whether for profit or not: Provided, that any person or entity which, in any manner, offers or promises for a fee employment to two or more persons shall be deemed engaged in recruitment and placement. To prove illegal recruitment, it must be shown that the accused-appellant gave complainants the distinct impression that he had the power or ability to send complainants abroad for work such that the latter were convinced to part with their money in order to be employed. To be engaged in the practice of recruitment and placement, it is plain that there must at least be a promise or offer of an employment from the person posing as a recruiter whether locally or abroad. Clearly, Samina Angeles defrauded complainants by falsely pretending to possess the power and capacity to process their travel documents. Article 315 of the Revised Penal Code imposes the penalty of prision correccional in its maximum period to prision mayor in its minimum period, if the amount of the fraud is over P12,000.00 but does not exceed P22,000.00; if the amount exceeds P22,000.00, the penalty provided shall be imposed in its maximum period, adding one year for each additional P10,000.00. However, the total penalty which may be imposed shall not exceed twenty years. ALMODIEL V. NLRC G.R. NO. 100641 JUNE 14, 1993 NOCON, J. Facts: Petitioner is a CPA hired as Cost Accounting Manager of Respondent Raytheon Philippines, Inc. As such, his major duties were (1) plan, coordinate, and carry out year-end physical inventory; (2) formulate and issue out hard copies of standard product costing and other cost/pricing analysis if needed and required; and set up the written cost accounting system for the whole company. However, when the standard cost accounting system for Raytheon plans worldwide was adopted and installed in the Philippine operations, the services of the petitioner was reduced to only the submission of period reports that would use computerized forms prescribed and designed by the international head office of the company in California, USA.

On January 27, 1989, petitioner was told of the abolition of his position on the ground of redundancy. He was constrained to file the complaint for illegal dismissal after his request to have him transferred to another department was denied. He also alleged that the functions of his position were absorbed by the Payroll/MIS/Finance Department which is headed by a resident alien without working permit from the DOLE. ISSUE: Whether or not the termination of the petitioner on the ground of redundancy was tainted with malice, bad faith and irregularity. Held: Termination of an employee's services because of redundancy is governed by Article 283 of the Labor Code which provides as follows: Art. 283. Closure of establishment and reduction of personnel. — The employer may also terminate the employment of any employee due to installation of laborsaving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the worker and the Department of Labor and Employment at least one (1) month before the intended date thereof. In case of termination due to installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closure or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to at least one (1) month pay or at least onehalf (1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6) months shall be considered as one (1) whole year. There is no dispute that petitioner was duly advised, one (1) month before, of the termination of his employment on the ground of redundancy in a written notice by his immediate superior Raytheon had a broad latitude of discretion in abolishing his position. An employer has a much wider discretion in terminating employment relationship of managerial personnel compared to rank and file employees. The reason obviously is that officers in such key positions perform not only functions which by nature require the employer's full trust and confidence but also functions that spell the success or failure of an enterprise. Article 40 of the Labor Code which requires employment permit refers to nonresident aliens. The employment permit is required for entry into the country for employment purposes and is issued after determination of the non-availability of a person in the Philippines who is competent, able and willing at the time of application to perform the services for which the alien is desired. Since Ang Tan Chai is a resident alien, he does not fall within the ambit of the provision.

Finding no grave abuse of discretion on the part of the National Labor Relations Commission in reversing and annulling the decision of the Labor Arbiter and that on the contrary, the termination of petitioner's employment was anchored on a valid and authorized cause under Article 283 of the Labor Code, the instant petition for certiorari must fail. DEE C. CHUAN AND SONS VS. COURT OF INDUSTRIAL RELATIONS 85 PHIL 431 JANUARY 31, 1950 TUASON, J. FACTS: Dee C. Chuan & Sons, Inc. assails the validity of an order of the Court of Industrial Relations. The order made upon petitioner's request for authority to hire" about twelve(12) more laborers from time to time and on a temporary basis," contains the proviso that "the majority of the laborers to be employed should be native." The petition was filed pending settlement by the court of a labor dispute (strike) between the petitioner and Kaisahan Ng Mga Manggagawa sa Kahoy sa Pilipinas. It is next said that "The Court of Industrial Relations cannot intervene in questions of selection of employees and workers so as to impose unconstitutional restrictions," and that "The restrictions of the number of aliens that may be employed in any business, occupation, trade or profession of any kind, is a denial of the equal protection of the laws." Although the brief does not name the persons who are supposed to be denied the equal protection of the laws, it is clearly to be inferred that aliens in general are in petitioner's mind. Certainly, the order does not, directly or indirectly, immediately or remotely, discriminate against the petitioner on account of race or citizenship. The order could have been issued in a case in which the employer was a Filipino. As a matter of fact the petitioner insists that 75 % of its shares of stock are held by Philippine citizens, a statement which is here assumed to be correct. ISSUE:Whether or not the order of CIR is valid and constitutional? RULING: Yes. Costs against petitioners. Ratio. An alien may question the constitutionality of a statute (or court order) only when and so far as it is being, or is about to be, applied to his disadvantage. (16 C.J.S. 157 et seq.) The prospective employees whom the petitioner may contemplate employing have not come forward to seek redress; their identity has not even been revealed. Clearly the petitioner has no case in so far as it strives to protect the rights of others, much less others who are unknown and undetermined. We are of the opinion that the order under consideration meets the test of reasonableness and public interest. The passage of Commonwealth Act No. 103 was "in conformity with the constitutional objective and . . . the historical fact that industrial and agricultural disputes have given rise to disquietude, bloodshed and revolution in our country." (Antamok Goldfields Mining Co. vs. Court of Industrial Relations, 40 Off. Gaz., 8th Supp., 173.)

NITTO ENTERPRISES VS. NLRC AND R. CAPILI G.R. NO. 114337 SEPT. 29, 1995 KAPUNAN, J. FACTS: Petitioner Nitto Enterprises, a company engaged in the sale of glass and aluminum products, hired Roberto Capili sometime in May 1990 as an apprentice machinist, molder and core maker as evidenced by an apprenticeship agreement 2for a period of six (6) months from May 28, 1990 to November 28, 1990 with a daily wage rate of P66.75 which was 75% of the applicable minimum wage. On August 2, 1990, Roberto Capili who was handling a piece of glass which he was working on, accidentally hit and injured the leg of an office secretary who was treated at a nearby hospital. Further, Capili entered a workshop within the office premises which was not his work station. There, he operated one of the power press machines without authority and in the process injured his left thumb. The following day he was asked to resign. Three days after, , private respondent formally filed before the NLRC Arbitration Branch, National Capital Region a complaint for illegal dismissal and payment of other monetary benefits. The Labor Arbiter rendered his decision finding the termination of private respondent as valid and dismissing the money claim for lack of merit. On appeal, NLRC issued an order reversing the decision of the Labor Arbiter. The NLRC declared that Capili was a regular employee of Nitto Enterprises and not an apprentice. Consequently, Labor Arbiter issued a Writ of Execution ordering for the reinstatement of Capili and to collect this back wages. Petitioner, Nitto Enterprises filed a case to the Supreme Court. ISSUE: Does the NLRC correctly rule that Capili is a regular employee and not an apprentice of Nitto Enterprises? RULING: Yes. The apprenticeship agreement between petitioner and private respondent was executed on May 28, 1990 allegedly employing the latter as an apprentice in the trade of "care maker/molder. However, the apprenticeship Agreement was filed only on June 7, 1990.Notwithstanding the absence of approval by the Department of Labor and Employment, the apprenticeship agreement was enforced the day it was signed. The act of filing the proposed apprenticeship program with the Department of Labor and Employment is a preliminary step toward sits final approval and does not instantaneously give rise to an employerapprentice relationship. Nitto Enterprises did not comply with the requirements of the law. It is mandated that apprenticeship agreements entered into by the employer and apprentice shall be entered only in accordance with the apprenticeship program duly approved by the Minister of Labor and Employment. Thus, the apprenticeship

agreement has no force and effect; and Capili is considered to be a regular employee of the company. FILAMER CHRISTIAN INSTITUTE VS. HON. INTERMEDIATE APELLATE COURT G.R. NO. 75112 AUGUST 17, 1992 GUTIERREZ, JR., J. FACTS: Daniel Funtecha was a working student of Filamer. He was assigned as the school janitor to clean the school 2 hours every morning. Allan Masa was the son of the school president and at the same time he was the school’s jeepney service driver. On October 20, 1977 at about 6:30pm, after driving the students to their homes, Masa returned to the school to report and thereafter have to go home with the jeep so that he could fetch the students early in the morning. Masa and Funtecha live in the same place so they usually go home together. Funtecha had a student driver’s license so Masa let him take the driver’s seat. While Funtecha was driving, he accidentally hit an elderly Kapunan which led to his hospitalization for 20 days. Kapunan filed a criminal case and an independent civil action based on Article 2180 against Funtecha. In the independent civil action, the lower court ruled that Filamer is subsidiarily liable for the tortious act of Funcheta and was compelled to pay for damages based on Article 2180 which provides that employers shall be liable for the damages caused by their employees and household helpers acting within the scope of their assigned tasks. Filamer assailed the decision and it argued that under Section 14, Rule X, Book III of the Labor Code IRR, working scholars are excluded from the employment coverage hence there is no employer-employee relations between Filamer and Funcheta; that the negligent act of Funcheta was due to negligence only attributable to him alone as it is outside his assigned task of being the school janitor. The CA denied Filamer’s appeal but the Supreme Court agreed with Filamer. Kapunan filed for a motion for reconsideration. ISSUE: Whether or not Filamer should be held subsidiarily liable. HELD: Yes. This time, the SC ruled in favor of Kapunan (actually his heirs cause by this time Kapunan was already dead). The provisions of Section 14, Rule X, Book III of the Labor Code IRR was only meant to provide guidelines as compliance with labor provisions on working conditions, rest periods, and wages is concerned. This does not in any way affect the provisions of any other laws like the civil code. The IRR cannot defeat the provisions of the Civil Code. In other words, Rule X is merely a guide to the enforcement of the substantive law on labor. There is a distinction hence Section 14, Rule X, Book III of the Rules is not the decisive law in a civil suit for damages instituted by an injured person during a

vehicular accident against a working student of a school and against the school itself. The present case does not deal with a labor dispute on conditions of employment between an alleged employee and an alleged employer. It invokes a claim brought by one for damages for injury caused by the patently negligent acts of a person, against both doer-employee and his employer. Hence, the reliance on the implementing rule on labor to disregard the primary liability of an employer under Article 2180 of the Civil Code is misplaced. An implementing rule on labor cannot be used by an employer as a shield to void liability under the substantive provisions of the Civil Code. Funtecha is an employee of Filamer. He need not have an official appointment for a driver’s position in order that Filamer may be held responsible for his grossly negligent act, it being sufficient that the act of driving at the time of the incident was for the benefit of Filamer (the act of driving the jeep from the school to Masa’s house is beneficial to the school because this enables Masa to do a timely school transportation service in the morning). Hence, the fact that Funtecha was not the school driver or was not acting with the scope of his janitorial duties does not relieve Filamer of the burden of rebutting the presumption juris tantum that there was negligence on its part either in the selection of a servant or employee, or in the supervision over him. Filamer has failed to show proof of its having exercised the required diligence of a good father of a family over its employees Funtecha and Allan. BROTHERHOOD LABOR UNITY MOVEMENT OF THE PHILIPPINES VS. ZAMORA G.R. NO. 48645 JANUARY 7, 1987 GUTIERREZ, JR., J. FACTS: Unrebutted evidence and testimony on record establish that the petitioners are workers who have been employed at the San Miguel Parola Glass Factory since 1961, averaging about seven (7) years of service at the time of their termination. They worked as "cargadores" or "pahinante" at the SMC Plant loading, unloading, piling or palleting empty bottles and woosen shells to and from company trucks and warehouses. At times, they accompanied the company trucks on their delivery routes. The petitioners worked exclusive at the SMC plant, never having been assigned to other companies or departments of SMC plant, even when the volume of work was at its minimum. On February 20, 1969, all the petitioners were dismissed from their jobs and, thereafter, denied entrance to respondent company's glass factory despite their regularly reporting for work. A

complaint for illegal dismissal and unfair labor practice was filed by the petitioners. ISSUES: San Miguel refused to bargain with the petitioner union alleging that the workers are not their employees. The elemental question in labor law of whether or not an employer-employee relationship exists between petitioners-members of the "Brotherhood Labor Unit Movement of the Philippines"(BLUM) and respondent San Miguel Corporation, is the main issue in this petition. DECISION: The petition is granted. The San Miguel Corporation is ordered to reinstate petitioners, with three(3) years backwages. However, where reinstatement is no longer possible, the respondent SMC is ordered to pay the petitioners separation pay equivalent to one (1) month pay for every year of service. TABAS ET., AL VS. CALIFORNIA MANUFACTURING CO. ET., AL G.R. NO. L-80680 JANUARY 26, 1989 SARMIENTO, J. FACTS: The petitioners petitioned the National Labor Relations Commission for reinstatement and payment of various benefits, including minimum wage, overtime pay, holiday pay, thirteen-month pay, and emergency cost of living allowance pay, against the respondent, the California Manufacturing Company. California denied the existence of an employer-employee relation between the petitioners and the company and impleaded Livi Manpower Services, Inc. as a party-respondent. The petitioners were then made to sign employment contracts with durations of six months, upon the expiration of which they signed new agreements with the same period. Pending proceeding they were notified by California that they would not be rehired. As a result, they filed an amended complaint charging California with illegal dismissal. ISSUE: Whether or not there exist an employee-employer relationship between petitioners and California Manufacturing Company HELD: Yes. The existence of an employer-employees relation is a question of law and being such, it cannot be made the subject of agreement. Hence, the fact that the manpower supply agreement between Livi and California had specifically designated the former as the petitioners' employer and had absolved the latter from any liability as an employer, will not erase either party's obligations as an

employer, if an employer-employee relation otherwise exists between the workers and either firm. At any rate, since the agreement was between Livi and California, they alone are bound by it, and the petitioners cannot be made to suffer from its adverse consequences. The Court has consistently ruled that the determination of whether or not there is an employer-employee relation depends upon four standards: (1) the manner of selection and engagement of the putative employee; (2) the mode of payment of wages; (3) the presence or absence of a power of dismissal; and (4) the presence or absence of a power to control the putative employee's conduct. Of the four, the right-of-control test has been held to be the decisive factor.

SEVILLA VS. CA G.R. NO. L-44182-3 APRIL 15, 1988 SARMIENTO, J. FACTS: The petitioners invoke the provisions on human relations of the Civil Code in this appeal by certiorari. Mrs. Segundina Noguera, party of the first part; the Tourist World Service, Inc., represented by Mr. Eliseo Canilao as party of the second part, and hereinafter referred to as appellants, the Tourist World Service, Inc. leased the premises belonging to the party of the first part at Mabini St., Manila for the former-s use as a branch office. In the said contract the party of the third part held herself solidarily liable with the party of the part for the prompt payment of the monthly rental agreed on. When the branch office was opened, the same was run by the herein appellant Una 0. Sevilla payable to Tourist World Service Inc. by any airline for any fare brought in on the efforts of Mrs. Lina Sevilla, 4% was to go to Lina Sevilla and 3% was to be withheld by the Tourist World Service, Inc. On November 24, 1961 the Tourist World Service, Inc. appears to have been informed that Lina Sevilla was connected with a rival firm, the Philippine Travel Bureau, and, since the branch office was anyhow losing, the Tourist World Service considered closing down its office. On June 17,1963, appellant Lina Sevilla refiled her case against the herein appellees and after the issues were joined, the reinstated counterclaim of Segundina Noguera and the new complaint of appellant Lina Sevilla were jointly heard following which the court ordered both cases dismiss for lack of merit. In her appeal, Lina Sevilla claims that a joint bussiness venture was entered into by and between her and appellee TWS with offices at the Ermita branch office and that she was not an employee of the TWS to the end that her relationship with TWS was one of a joint business venture appellant made declarations.

ISSUE: Whether or not the padlocking of the premises by the Tourist World Service, Inc. without the knowledge and consent of the appellant Lina Sevilla entitled the latter to the relief of damages prayed for and whether or not the evidence for the said appellant supports the contention that the appellee Tourist World Service, Inc. unilaterally and without the consent of the appellant disconnected the telephone lines of the Ermita branch office of the appellee Tourist World Service, Inc.? HELD: The trial court held for the private respondent on the premise that the private respondent, Tourist World Service, Inc., being the true lessee, it was within its prerogative to terminate the lease and padlock the premises. It likewise found the petitioner, Lina Sevilla, to be a mere employee of said Tourist World Service, Inc. and as such, she was bound by the acts of her employer. The respondent Court of Appeal rendered an affirmance. In this jurisdiction, there has been no uniform test to determine the evidence of an employer-employee relation. In general, we have relied on the so-called right of control test, "where the person for whom the services are performed reserves a right to control not only the end to be achieved but also the means to be used in reaching such end." Subsequently, however, we have considered, in addition to the standard of right-of control, the existing economic conditions prevailing between the parties, like the inclusion of the employee in the payrolls, in determining the existence of an employer-employee relationship. CONTINENTAL MARBLE CORPORATION VS. NLRC G.R. NO. L-43825 MAY 9, 1988 PADILLA, J. FACTS: Private respondent Rodito Nasayao claimed that sometime in May 1974, he was appointed plant manager of the petitioner corporation, with an alleged compensation of P3,000.00, a month, or 25% of the monthly net income of the company, whichever is greater, and when the company failed to pay his salary for the months of May, June, and July 1974, Rodito Nasayao filed a complaint with the National Labor Relations Commission, Branch IV, for the recovery of said unpaid varies. Petitioners denied that Rodito Nasayao was employed in the company as plant manager with a fixed monthly salary of P3,000.00. They claimed that the undertaking agreed upon by the parties was a joint venture, a sort of partnership, wherein Rodito Nasayao was to keep the machinery in good working condition and, in return, he would get the contracts from end-users for the installation of marble products, in which the company would not interfere. In addition, private respondent Nasayao was to receive an amount equivalent to 25% of the net profits that the petitioner corporation would realize, should there be any. Petitioners alleged that since there had been no profits during said period, private respondent was not entitled to any amount.

The case was submitted for voluntary arbitration and the parties selected the herein respondent Jose T. Collado as voluntary arbitrator. In the course of the proceedings, however, the herein petitioners challenged the arbitrator’s capacity to try and decide the case fairly and judiciously and asked him to desist from further hearing the case. But, the respondent arbitrator refused. In due time, or on 29 December 1975, he rendered judgment in favor of the complainant, ordering the herein petitioners to pay Rodito Nasayao the amount of P9,000.00, within 10 days from notice. ISSUE: Whether or not Voluntary Arbitration award, generally final or there are exceptions? HELD: A voluntary arbitrator by the nature of her fucntions acts in quasijudicial capacity. There is no reason why her decisions involving interpretation of law should be beyond this Court’s review. Administrative officials are presumed to act in accordance with law and yet we do hesitate to pass upon their work where a question of law is involved or where a showing of abuse of authority or discretion in their official acts is properly raised in petitions for certiorari. The decisions of the voluntary arbitrators must be given the highest respect and as a general rule must be accorded a certain measure of finality. This is especially true where the arbitrator chosen by the parties enjoys first rate credentials. It is not correct however, that this respect precludes the exercise of judicial review over their decisions. In spite of statutory provisions making final the decisions of certain administrative agencies, the SC may take cognizance of petitions questioning these decisions where want of jurisdiction, grave abuse of discretion, violation of due process, denial of substantial justice, or erroneous interpretation of the law are brought to its attention. ENCYCLOPEDIA BRITANNICA INC. VS. NLRC G.R. NO. 87098 NOV. 4, 1996 TORRES, JR., J. FACTS: Private respondent was a sales division manager of private petitioner and was in charge of selling the latter’s products through sales representatives. As compensation, private respondent receive commissions from the products sold by his agents. After resigning from office to pursue his private business, he filed a complaint against the petitioner, claiming for non-payment of separation pay and other benefits. Petitioner alleged that complainant was not its employee but an independent dealer authorized to promote and sell its products and in return, received commissions therefrom. Petitioner did not have any salary and his income from petitioner was dependent on the volume of sales accomplished. He had his own office, financed the business expense, and maintained his own workforce. Thus petitioner argued that it had no control and supervision over the complainant as

to the manner and means he conducted his business operations. The Labor Arbiter ruled that complainant was an employee of the petitioner company. Petioner had control over the complainant since the latter was required to make periodic reports of his sales activities to the company. ISSUE: Whether or not there exists an employer-employee relationship. HELD: No. Control of employee’s conduct is commonly regarded as the most crucial and determinative indicator of the presence or absence of an employeremployee relationship. Under this, an employer-employee relationship exists where the person for whom the services are performed reserves the right to control not only the end to be achieved, but also the manner and means to be used in reaching that end. The fact that petitioner issued memoranda to private respondent and to other division sales managers did not prove that petitioner had actual control over them. The different memoranda were merely guidelines on company policies which the sales managers follow and impose on their respective agents.

DY KEH BENG VS. INTERNATIONAL LABOR AND MARINE UNION ET., AL. G.R NO. L-32245 MAY 25, 1979 DE CASTRO, J. FACTS: A charge for ULP was filed against Dy Keh beng for discriminatory acts within the meaning of RA 875, Section 4(a.1) and 4(a.2) by dismissing Carlos N. Solano and Ricardo Tudla for their union activities. A case was filed in court and Dy Keh Beng contended that he did not know Tudla and that Solano was not his employee because the latter came to the establishment only when there was work which he did on pakiaw basis, each piece of work being done under a separate contract. The CIR held that an Er-Ee relationship existed between Dy Keh Beng and complainants Tudla and Solano, although Solano was admitted to have worked on piece basis. Petitioner anchors his contention of the non-existence of employee-employer relationship on the control test., arguing that there was no evidence to show that petitioner had the right to direct the manner and method of respondent’s work. ISSUE: Whether or not there existed an employee-employee relation between petitioner Dy Keh Beng and respondents Solano and Tudla. HELD: The Court held in the affirmative. According to the Hearing Examiner, the evidence tended to show that the two became employees of Dy Keh Beng from 1953 and 1955, respectively, and that except in the event of illness, their work with the establishment was continuous although their services were compensated

on piece basis. It should be borne in mind that the control test calls merely for the existence of the right to control the manner of doing the work, not the actual exercise of the right. Considering that the establishment of Dy Keh Beng is “engaged in the manufacture of baskets known as kaing, it is natural to expect that those working under Dy Keh Beng would have to observe, among others, Dy’s requirements of size and quality of the kaing. ZANOTTE SHOES VS. NLRC G.R. NO. 100665 FEB. 13, 1995 VITUG, J. FACTS: Private respondents Joseph Lluz, et. al averred that they started to work for petitioners Zanotte Shoes/ Leonardo Lorenzo between 1975 to 1987. They alleged that they worked for a minimum of 12 hours daily, including Sundays and holidays when needed and that they were paid on piece-work basis. Private respondents claimed that it angered petitioner Lorenzo when they requested to be made members of the SSS and that when they demanded an increase in their pay rates, they were prevented from entering the work premises. Private respondents filed a complaint for illegal discharge against petitioners. Petitioners, in their Answer, claim that their business operations were only seasonal, normally twice a year- one in June and another in December, when heavy job orders would come in. They contend that private respondents were engaged on purely contractual basis and paid the rates conformably with their respective agreements. The Labor Arbiter rendered judgment in favor of private respondents. He declared that there was an employer-employee relationship between petitioners and private respondents and that the latter were regular employees of the former. The Labor Arbiter concluded that there is neither dismissal nor abandonment, but ordered petitioners to pay the private respondents their separation pay. The NLRC, on appeal, affirmed the Labor Arbiter’s decision. ISSUE: Whether or not there is an employer-employee relationship between petitioners and private respondents. HELD: YES. There is an employer-employee relationship between petitioners and private respondents. The work of private respondents is clearly related to and in the pursuit of the principal activity of the petitioners. The indicia used for determining the existence of an employer-employee relationship, all extant in the case at bench, include: (1) the selection and engagement of the employee, (2) the payment of wages, (3) the power of dismissal, and(4)the employer’s power to control the employee with respect to the result of the work to be done and to the means and methods by which the work is to be accomplished. The last requirement, so herein posed as an issue, refers to the existence of the right to control and not necessarily to the actual exercise of the right. The Court, however, finds the award of separation pay to be unwarranted. The Labor Arbiter, sustained by the NLRC, concluded that there was neither dismissal nor

abandonment. The fact of the matter is that petitioners have repeatedly indicated their willingness to accept the private respondents, but the latter have steadfastly refused the offer. For being without any clear legal basis, the award of separation pay must thus be set aside. There is nothing, however, that prevents petitioners from voluntarily giving private respondents some amounts on ex gratia basis. AIR MATERIAL WING SAVINGS AND LOAN ASSOCIATION INC., VS. NLRC G.R. NO. L -11870 JUNE 30, 1994 CONCEPCION, J. FACTS: Private respondent Luis S. Salas was appointed "notarial and legal counsel" for petitioner AirMaterial Wings Savings and Loan Association in 1980. The appointment was renewed for three years in an implementing order dated January 23, 1987. Subsequently, on January 9, 1990, the petitioner issued another order reminding Salas of the approaching termination of his legal services under their contract. This prompted Salas to lodge a complaint against AMWSLAI for separation pay, vacation and sick leave benefits, cost of living allowances, refund of SSS premiums, moral and exemplary damages, payment of notarial services rendered from February 1, 1980 to March 2, 1990, and attorney's fees. Instead of filing an answer, AMWSLAI moved to dismiss for lack of jurisdiction. It averred that there was no employer-employee relationship between it and Salas and that his monetary claims properly fell within the jurisdiction of the regular courts. Salas opposed the motion and presented documentary evidence to show that he was indeed an employee of AMWSLAI. Nevertheless, most of Salas' claims were dismissed by the labor arbiter in his decision dated November 21, 1991.It was there held that Salas was not illegally dismissed and so not entitled to collect separation benefits. His claims for vacation leave, sick leave, medical and dental allowances and refund of SSS premiums were rejected on the ground that he was a managerial employee. He was also denied moral and exemplary damages for lack of evidence of bad faith on the part of AMWSLAI. Neither was he allowed to collect his notarial fees from 1980 up to 1986 because the claim therefore had already prescribed. However, the petitioner was ordered to pay Salas his notarial fees from 1987 up to March 2,1990, and attorney's fee equivalent to 10% of the judgment award. On appeal, the decision was affirmed in toto by the respondent Commission, prompting the petitioner to seek relief in the Supreme Court, hence, the case at bar. ISSUE: Whether or not Salas can be considered an employee of the petitioner company? RULING: The Supreme Court had held in a long line of decisions that the elements of an employer-employee relationship are: (1) selection and engagement of the employee; (2) payment of wages; (3)power of dismissal; and (4) employer's own power to control employee's conduct. The terms and conditions set out in the letter-contract entered into by the parties on January23,

1987, clearly show that Salas was an employee of the petitioner. His selection as the company counsel was done by the board of directors in one of its regular meetings. The petitioner paid him a monthly compensation/retainer's fee for his services. Though his appointment was for a fixed term of three years, the petitioner reserved its power of dismissal for cause or as it might deem necessary for its interest and protection. No less importantly, AMWSLAI also exercised its power of control over Salas by defining his duties and functions as its legal counsel, to wit: (1) To act on all legal matters pertinent to his Office; (2) To seek remedies to effect collection of overdue accounts of members without prejudice to initiating court action to protect the interest of the association; and (3) To defend by all means all suit against the interest of the Association. HYDRO RESOURCES CONTRACTORS CORP. VS. PAGALILAUAN 172 SCRA 399 APRIL 18, 1989 GUTIERREZ, JR., J. FACTS: Petitioner corporation hired the private respondent Aban as its "Legal Assistant" and received basic monthly salary of P1,500.00 plus an initial living allowance of P50.00 which gradually increased to P320.00. On September 4, 1980, Aban received a letter from the corporation informing him that he would be considered terminated effective October 4, 1980 because of his alleged failure to perform his duties well. Aban filed a complaint against the petitioner for illegal dismissal. The labor arbiter ruled that Aban was illegally dismissed. This ruling was affirmed by the NLRC on appeal. Hence, this present petition. ISSUE: Whether or not there was an employer-employee relationship between the petitioner corporation and Aban. HELD: The Supreme Court dismissed the petition for lack of merit, and reinstate Aban to his former or a similar position without loss of seniority rights and to pay three (3) years backwages without qualification or deduction and P5,000.00 in attorney's fees. Should reinstatement not be feasible, the petitioner shall pay the private respondent termination benefits in addition to the above stated three years backpay and P5,000.00 attorney's fees. A lawyer, like any other professional, may very well be an employee of a private corporation or even of the government. This Court has consistently ruled that the determination of whether or not there is an employer-employee relation depends upon four standards: (1) the manner of selection and engagement of the putative employee; (2) the mode of payment of wages; (3) the presence or absence of a power of dismissal; and (4) the presence or absence of a power to control the putative employee's conduct. Of the four, the right-of-control test has been held to be the decisive factor.

In this case, Aban received basic salary plus living allowance, worked solely for the petitioner, dealt only with legal matters involving the said corporation and its employees and also assisted the Personnel Officer in processing appointment papers of employees which is not act of a lawyer in the exercise of his profession. These facts showed that petitioner has the power to hire and fire the respondent employee and more important, exercised control over Aban by defining the duties and functions of his work which met the four standards in determining whether or not there is an employee-employer relationship. INSULAR ASSURANCE CO. VS. NLRC G.R. NO. 119930 MARCH 12, 1998 BELLOSILLO, J . FACTS: Since 1968, respondent Basiao has been an agent for petitioner company, and is authorized to solicit within the Philippines applications for insurance policies and annuities in accordance with the existing rules and regulations of the company. In return, he would receive compensation, in the form of commissions. Some four years later, in April 1972, the parties entered into another contract — an Agency Manager's Contract — and to implement his end of it Basiao organized an agency or office to which he gave the name M. Basiao and Associates, while concurrently fulfilling his commitments under the first contract with the Company. In May, 1979, the Company terminated the Agency Manager's Contract. After vainly seeking a reconsideration, Basiao sued the Company in a civil action and this, he was later to claim, prompted the latter to terminate also his engagement under the first contract and to stop payment of his commissions starting April 1, 1980. Basiao thereafter filed with the then Ministry of Labor a complaint against the Company and its president. The complaint sought to recover commissions allegedly unpaid thereunder, plus attorney's fees. The respondents disputed the Ministry's jurisdiction over Basiao's claim, asserting that he was not the Company's employee, but an independent contractor. ISSUE: Whether or not there exist an employer-employee relationship between Basiao and Insular Life? HELD: The SC ruled in favor of Insular Life. Not every form of control that the hiring party reserves to himself over the conduct of the party hired in relation to the services rendered may be accorded the effect of establishing an employer-employee relationship between them in the legal or technical sense of the term ANGELINA FRANCISCO VS. NLRC, KASEI CORP. ETC. G.R. NO. 170087 AUGUST 31, 2006

YNARES-SANTIAGO, J. FACTS: Petitioner was hired by Kasei Corporation during the incorporation stage. She was designated as accountant and corporate secretary and was assigned to handle all the accounting needs of the company. She was also designated as Liason Officer to the City of Manila to secure permits for the operation of the company. In 1996, Petitioner was designated as Acting Manager. She was assigned to handle recruitment of all employees and perform management administration functions. In 2001, Liza Fuentes replaced her as Manager. Kasei Corporation reduced her salary toP2,500 per month which was until September. She asked for her salary but was informed that she was no longer connected to the company. She did not anymore report to work since she was not paid for her salary. She filed an action for constructive dismissal with the Labor Arbiter. The Labor Arbiter found that the petitioner was illegally dismissed. NLRC affirmed the decision while CA reversed it. ISSUE: Whether or not there was employer-employee relationship. HELD: Petitioner is an employee of Kasei Corporation. The court held that in this jurisdiction, there has been no uniform test to determine the existence of an employer-employee relation. Generally, courts have relied on the so-called right of control test where the person for whom the services are performed reserves aright to control not only the end to be achieved but also the means to be used in reaching such end. In addition to the standard of right-of-control, the existing economic conditions prevailing between the parties, like the inclusion of the employee in the payrolls, can help in determining the existence of an employer-employee relationship. The better approach would therefore be to adopt a two-tiered test involving: (1) the putative employer’s power to control the employee with respect to the means and methods by which the work is to be accomplished; and (2) the underlying economic realities of the activity or relationship. Petitioner was selected and engaged by the company for compensation, and is economically dependent upon respondent for her continued employment in that line of business. There is no doubt that petitioner is an employee of Kasei Corporation because she was under the direct of it. OPULENCIA ICE PLANT VS. NLRC G.R. NO. 98368 DECEMBER 15, 1993

BELLOSILLO, J. FACTS: Manuel P. Esita was a compressor operator of Tiongson Ice Plant in San Pablo City (for 20 years). In 1980 he was hired as compressor operator-mechanic for the ice plants of petitioner Dr. Melchor Opulencia located in Tanauan, Batangas, and Calamba, Laguna. Initially assigned at the ice plant in Tanauan, Esita would work from seven o'clock in the morning to five o'clock in the afternoon receiving a daily wage of P35.00. In 1986, Esita was transferred to the ice plant in Calamba, which was then undergoing overhauling, taking the place of compressor operator Lorenzo Eseta, who was relieved because he was already old and weak. For less than a month, Esita helped in the construction-remodeling of Dr. Opulencia's house. In February 1989, for demanding the correct amount of wages due him, Esita was dismissed from service. Consequently, he filed with Sub-Regional Arbitration in San Pablo City, a complaint for illegal dismissal, underpayment, non-payment for overtime, legal holiday, premium for holiday and rest day, 13th month, separation/retirement pay and allowances against petitioners. ISSUE: Whether or not there was an employee-employer relationship between Opulencia and Esita. HELD: Yes. Because no particular form of evidence is required to prove the existence of an employer-employee relationship. Any competent and relevant evidence to prove the relationship may be admitted. For, if only documentary evidence would be required to show that relationship, no scheming employer would ever be brought before the bar of justice, as no employer would wish to come out with any trace of the illegality he has authored considering that it should take much weightier proof to invalidate a written instrument. On the claim that Esita's construction work could not ripen into a regular employment in the ice plant because the construction work was only temporary and unrelated to the ice-making business, needless to say, the one month spent by Esita in construction is insignificant compared to his nine-year service as compressor operator in determining the status of his employment as such, and considering further that it was Dr. Opulencia who requested Esita to work in the construction of his house. In allowing Esita to stay in the premises of the ice plant and permitting him to cultivate crops to augment his income, there is no doubt that petitioners should be commended; however, in view of the existence of an employer-employee relationship as found by public respondents, we cannot treat humanitarian reasons as justification for emasculating or taking away the rights and privileges of employees granted by law. Benevolence, it is said, does not operate as a license to circumvent labor laws. If petitioners were genuinely altruistic in extending to their employees privileges that are not even required by law, then there is no

reason why they should not be required to give their employees what they are entitled to receive. Moreover, as found by public respondents, Esita was enjoying the same privileges granted to the other employees of petitioners, so that in thus treating Esita, he cannot be considered any less than a legitimate employee of petitioners. DOMASIG VS. NLRC G.R. NO. 118101 SEPTEMBER 16, 1996 PADILLA, J. FACTS: Domasig filed a complained against CATA Garments Corporation for illegal dismissal, unpaid commission and other monetary claimed. He alleged that he was dismissed when CATA learned that a rival company pirated him. CATA claimed that he is not a regular employee but a mere commission agent who receives commission (no regular time schedule). Petitioner submitted his ID and cash vouchers reflecting salary payments. Labor Arbiter ruled in favor of Domasig but NLRC reversed such ruling. ISSUE: Whether or not there exist an employee-employer relationship. HELD: Yes. Substantial evidences: In a business establishment, an identification card is usually provided not only as a security measure but mainly to identify the holder thereof as a bona fide employee of the firm that issues it. Together with the cash vouchers covering petitioner’s salaries for the months stated therein. Petitioner employed by CATA for more than 1 year. EQUITABLE BANKING CORPORATION VS. NLRC AND R.L SADAC G.R. NO. 102467 JUNE 13, 1997 VITUG, J. FACTS: Atty. Sadac was appointed as VP for the Legal Department of Equitable. Nine lawyers, members of the said department, filed a letter-petition for Sadac’s abusive conduct, mismanagement, ineffectiveness and indecisiveness. They warned that they would resign en masse if Atty. Sadac were retained in his position. The Board asked Sadac to voluntarily resign rather than conduct a formal hearing to terminate him. Atty. Sadac filed a complaint for illegal dismissal and damages.

ISSUE: Whether or not there is employee-employer relationship. HELD: Yes. Aside from his work as VP, he was also working under the supervision of the President and Board of Directors. As employed for 8 years, Atty. Sadac received pay slips for monthly salaries. The bank withheld his taxes with BIR. The bank also enrolled him as employee under the SSS and Medicare programs. He contributed to Equitable’s Employees’ Provident Fund. A lawyer, like any other professional, may work in a company and be employed as a regular employee. The Court resolved first the issue of employee-employer relationship and ruled in the affirmative on the ground that private respondent participated as part of management and is one of its senior officers holding the position of VicePresident. Upon finding that private respondent is an employee of petitioner, the latter violated the right to due process of private respondent when the latter's request of full hearing was not granted. While it is true that the essence of due process is simply an opportunity to be heard or, as applied in administrative proceedings, an opportunity to explain one's side, meetings in the nature of consultation and conferences such as the case here, however, may not be valid substitutes for the proper observance of notice and hearing. However, reinstatement, which is the consequence of illegal dismissal, has markedly been rendered undesirable. Private respondent shall, instead, be entitled to back wages from the time of his dismissal until reaching sixty years of age and, thereupon, to retirement benefits in accordance with Article 287 of the Labor Code and Sec 14, Rule 1, Book VI of the Implementing rules of the Labor Code.

ZAMUDIO VS. NLRC G.R. NO. 76723 MARCH 25, 1990 FACTS: Petitioners rendered services essential for the cultivation of respondent’s farm. While the services were not continuous in the sense that they were not rendered everyday throughout the year, as is the nature of farm work, petitioners had never stopped working for respondent from year to year from the time he hired them to the time he dismissed. ISSUE:

Whether or not the petitioners are considered employees so that employeeemployer relationship may exist. HELD: The nature of their employment, i.e. “Pakyao” basis, does not make petitioner independent contractors. Pakyao workers are considered employees as long as the employer exercises control over the means by which such workers are to perform their work inside private respondents farm, the latter necessarily exercised control over the performed by petitioners. The seasonal nature of petitioner’s work does not detract from the conclusion that employer – employee relationship exits. Seasonal workers whose work is not merely for the duration of the season, but who are rehired every working season are considered regular employees. The circumstances that petitioners do not appear in respondent’s payroll do not destroy the employer – employee relationship between them. Omission of petitioners in the payroll was not within their control; they had no hand in the preparation of the payroll. This circumstance, even if true, cannot be taken against petitioners. PAGUIO VS. NLRC G.R. NO. 147816 MAY 9, 2003 VITUG, J. FACTS: Metro Times Corporation, publisher of "The Manila times" hired petitioner as account executive tasked to solicit advertisements for the said newspaper. In return he will receive commission equivalent to 15% on direct advertisements subject to tax deductions. Furthermore he receives a monthly allowance of 2000 if he meets the quota. On August 15, 1992 barely 2 months after the fifth renewal of his contract with the company he was informed about his termination based on accusations not clearly established. In their contract, there is a stipulation, which states that petitioner in not an employee of the company. Moreover, it states that either party may terminate the contract after 30 days notice. Respondent filed a complaint for illegal dismissal. Labor Arbiter found respondent company liable for illegal dismissal and ordered the reinstatement of the petitioner. On appeal NLRC reversed the decision affirmed in toto by CA, hence the appeal. ISSUES: Whether or not petitioner is an employee of the said company. Whether or not the dismissal was proper. HELD: The prime question here is whether petitioner is a regular employee or not. A regular employee is one who is engaged to perform activities, which are necessary and desirable in the usual business or trade of the employer as against those

which are undertaken for a specific project or are seasonal. Even in these latter cases, where such person has rendered at least one year of service, regardless of the nature of the activity performed or of whether it is continuous or intermittent, the employment is considered regular as long as the activity exists, it not being indispensable that he be first issued a regular appointment or be formally declared as such before acquiring a regular status. Admittedly, company's president acceded that petitioner’s work is of great importance in the survival of the company being the advertisements solicited by the petitioner are the lifeblood of the company. GREAT PACIFIC LIFE ASSURANCE CORP. VS. JUDICO G.R. NO. 73887 DECEMBER 21, 1989 PARAS, J. FACTS: On August 27, 1982, the private respondent filed a complaint for illegal dismissal against the petitioner. The private respondent was a debit agent, defined as “an insurance agent selling/servicing industrial life plans and policyholders”. He had definite work assignments including but not limited to selling insurance and collection of premiums from policyholders. As compensation, he was initially paid PHP200.00 as allowance for thirteen weeks regardless of production and later a certain commission from his total collections. He was promoted to the position of Zone Supervisor and was given additional allowance fixed atPHP110.00 per week. However, he was reverted back to his former position after two months for unknown reasons and was finally dismissed by way of termination of agency contract. The petitioner contended that the private respondent was not an employee of the company entitled to the protection of the law against illegal dismissal. The latter’s compensation, in the form of commissions and bonuses, was based on actual production. The Labor Arbiter dismissed the complaint on the ground that the employeremployee did not exist between the parties. On appeal, the NLRC reversed the ruling stating that the private respondent was a regular employee as defined under Article 281 of the Labor Code. ISSUE: Whether or not an employee-employer relationship existed between the petitioner and the private respondent. HELD: One salient point in the determination of employer-employee relationship which cannot be easily ignored is the fact that the compensation that these agents on commission received is not paid by the insurance company but by the investor (or the person insured). The test is whether the “employer” controls or has reserved

the right to control the “employee” not only as to the result of the work to be done but also as to the means and methods by which the same is to be accomplished. The private respondent received a definite minimum amount per week as his wage known as “sales reserve”. He was assigned a definite place in the office to work on when he is not in the field; and in addition to his canvassing work he was burdened with the job of collection. Conversely, he was promoted to Zone Supervisor with additional allowance of a definite amount aside from the regular weekly “allowance”. His contract of services was neither for a piece of work nor for a definite period. The private respondent was controlled by the petitioner not only as to the kind of work; the amount of results, the kind of performance but also the power of dismissal. Thus, he was an employee of the petitioner. The appealed decision is AFFIRMED. FEATI UNIVERSITY VS. HON. JOSE S. BAUTISTA AND FEATI UNIVERSITY FACULTY CLUB G.R. NO. L-21278 DECEMBER 27, 1966 ZALDIVAR, J. FACTS: A strike was declared by the members of Feati Unity Faculty Club resulting in the disruption of the classes. Despite further efforts from Department of Labor, the dispute between the union and management of Feati was not settled. The President of the PH certified the dispute to the Court of Industrial Relations. Cases were filed with CIR. CIR ordered that striking faculty members would return to work and the University to admit them under status quo agreement. The latter prayed for dismissal of the case on the ground that CIR has no jurisdiction. It contended that the Industrial Peace Act is not applicable to the university and the members of the Faculty club are mere independent contractors. ISSUE: Whether FEATI is an employer within the purview of the Industrial Peace Act. HELD: The Supreme Court denied the petition. Based on RA 875 Section 2(c) The term employer include any person acting in the interest of an employer, directly or indirectly, but shall not include any labor organization (otherwise than when acting as an employer) or any one acting in the capacity or agent of such labor organization.

In this case, the University is operated for profit hence included in the term of employer. Professors and instructors, who are under contract to teach particular courses and are paid for their services, are employees under the Industrial Peace Act. Professors and instructors are not independent contractors. University controls the work of the members of its faculty; that a university prescribes the courses or subjects that professors teach, and when and where to teach; that the professors’ work is characterized by regularity and continuity for a fixed duration; that professors are compensated for their services by wages and salaries, rather than by profits; that the professors and/or instructors cannot substitute others to do their work without the consent of the university; and that the professors can be laid off if their work is found not satisfactory. All these indicate that the university has control over their work; and professors are, therefore, employees and not independent contractors. The principal consideration in determining whether a workman is an employee or an independent contractor is the right to control the manner of doing the work, and it is not the actual exercise of the right of interfering with the work, but the right to control, which constitutes the test. CITIZENS LEAGUE OF FREE WORKERS ET. AL., VS. ABBAS G.R. NO. L-21212 SEPTEMBER 23, 1966 DIZON, J. FACTS: The petitioners used to lease the auto-calesas operated by the private respondents on a daily rental basis. After sometime, the petitioners tried to get the private respondents to recognize them as employees instead of lessees and to bargain on that basis. The private respondents refused to negotiate. On February 20, 1963, the petitioners declared a strike and since then paralyzed the autocalesa operations through threats, intimidation and violence. On March 11, 1963, the private respondents filed a complaint with the CFI to restrain the petitioners and to recover damages. The complaint also prayed for the issuance of a writ of preliminary junction ex-parte restraining defendants therein from committing said acts of violence and intimidation during the pendency of the case. Consequently, the petitioners filed a complaint of unfair labor practice against the private respondents on the ground, among others, of the latters’ refusal to bargain with them. They also filed a motion to declare the writ of preliminary injunction void since the same had expired by virtue of Section 9 (d) of Republic Act 875 wherein there cannot be any ex parte grant of a restraining order in a case involving a labor dispute.

In his order of March 21, 1963, however, the respondent judge denied said motion on the ground that there was no employer-employee relationship between the petitioners and private respondents. ISSUE: Whether or not there was an employer-employee relationship between the parties. HELD: Stating the case of Isabelo Doce vs. Workmen' s Compensation Commission, et al., the Court held that a driver of a jeep who operates the same under the boundary system is considered an employee within the meaning of the law and as such the case comes under the jurisdiction of the Court of Industrial Relations. The lessor-lessee relationship cannot be sustained between an operator and his drivers for the sole ground that the latter were not paid any fixed wage and that their compensation was the excess of the total amount of fares earned. The drivers did not have any interest in the business because they did not invest anything in the acquisition of the jeeps and did not participate in the management thereof, their service as drivers of the jeeps being their only contribution to the business. There was a labor dispute between the parties from the beginning. The writ of preliminary injunction was set aside. VILLAMARIA VS. CA AND BUSTAMANTE G.R. NO. 165881 APRIL 19, 2006 CALLEJO, SR., J. FACTS: Petitioner was the owner of the jeepneys, which the private respondent is the one who is driving in a “boundary basis”. Villamaria and Bustamante entered into a contract were the petitioner agreed to sell the jeepney entitled “Kasunduan ng Bilihan ng Sasakayan sa Pamamagitan ng Boundary-Hulog” were Bustamante would remit to Villamaria P550.00 a day for a period of four years. Both parties agreed in such terms and stipulations of the contract. When the private respondent failed to pay the boundary-hulog, Villarama took back the jeepney driven by Bustamante and barred the latter from driving the vehicle. Due to the action of petitioner, Bustamante files a complaint before the court. ISSUE: Whether or not there exist an employee-employer relationshop. HELD: Yes. The juridical relationship of employer-employee between petitioner and respondent was not negated by the foregoing stipulation in the Kasunduan, considering that petitioner retained control of respondent’s conduct as driver of the vehicle. Even if the petitioner was allowed to let some other person drive the unit, it was not shown that he did so; that the existence of an employment

relation is not dependent on how the worker is paid but on the presence or absence of control over the means and method of the work; that the amount earned in excess of the “boundary hulog” is equivalent to wages; and that the fact that the power of dismissal was not mentioned in the Kasunduan did not mean Villamaria never exercised such power, or could not exercise such power. Hence, the employer- employee relationship exists. SY ET. AL., VS. HON. COURT OF APPEALS AND J. SAHOT G.R. NO. 142293 FEBRUARY 27, 2003 QUIZUMBING, J. FACTS: Complainant started working with respondent SBT Trucking in 1958 at age 23, first as a fire truck helper and later as truck driver, until 1994 when at age 59 he was separated for his inability to work due to sickness. When he inquired with the SSS, he learned that the trucking company never paid his SSS premiums. The company contended that he was never an employee but an industrial partner and that he would not have been separated if he returned to his work after his sick leave; it was he, rather, that could not resume his work. ISSUE: Whether or not an employee-employer relationship existed between the parties. HELD: It shows that the complainant was only 23 years old when he started working with respondent as truck helper. SC questioned how a 23 year old man, working as a truck helper, be considered an industrial partner. Hence the Court ruled that complainant was only an employee, not a partner of respondents from the time complainant started working for respondent. There was no written agreement, no proof that the complainant received a share in petitioners’ profits, nor was there anything to show he had any participation with respect to the running of the business. The elements to determine the existence of an employment relationship are: (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’s conduct. The most important element is the employer’s control of the employee’s conduct, not only as to the result of the work to be done, but also as to the means and methods to accomplish it. As found by the appellate court, petitioners owned and operated a trucking business since the1950s and by their own allegations, they determined private respondent’s wages and rest day. Records of the case show that private respondent actually engaged in work as an employee. During the entire course of his employment he did not have the freedom to determine where he would go, what he would do, and how he would do it. He merely followed instructions of petitioners and was content to do so, as long as he was paid his wages. Indeed,

said the CA, private respondent had worked as a truck helper and driver of petitioners not for his own pleasure but under the latter’s control. MAKATI HABERDASHERY INC. VS. NLRC G.R. NOS. 83380-81 NOVEMBER 15, 1989 FERNAN, C.J., FACTS: Individual complainants have been working for Makati Haberdashery Inc. as tailors, seamsters, sewers, basters and plantsadoras. They were paid on a piecerate basis except two who were paid on a monthly basis. In addition to their piece-rate, they were given daily allowance of P3.00 provided they report for work before 9:30am everyday. They were required to work from or before 9:30am up to 6-7pmfrom Monday to Saturday and during peak periods even on Sundays and holidays. The Sandigan ng Manggagawang Pilipino filed a complaint for underpayment of the basic wage, underpayment of living allowance, nonpayment of overtime work, nonpayment of holiday pay and other money claims. The Labor Arbiter rendered judgment in favor of complainants, which the NLRC affirmed. Petitioner urged that the NLRC erred in concluding that an employer-employee relationship existed between the petitioners and the workers. ISSUE: Whether or not employee-employer relationship existed between petitioners and its workers. HELD: The test of employer-employee relationship is four-fold: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's conduct. It is the so-called "control test" that is the most important element. This simply means the determination of whether the employer controls or has reserved the right to control the employee not only as to the result of the work but also as to the means and method by which the same is to be accomplished. The facts at bar indubitably reveal that the most important requisite of control is present. As gleaned from the operations of petitioner, when a customer enters into a contract with the haberdashery or its proprietor, the latter directs an employee who may be a tailor, pattern maker, sewer or "plantsadora" to take the customer's measurements, and to sew the pants, coat or shirt as specified by the customer. Supervision is actively manifested in all these aspects — the manner and quality of cutting, sewing and ironing.

CAURDANETAAN PIECE WORKERS UNION VS. UNDERSECRETARY BIENVENIDO LAGUESMA G.R. NO. 113542 FEBRUARY 24, 1998 PANGANIBAN, J. FACTS: Complainants worked as cargador at the warehouse and rice mills of Private Respondent Corfarm. As cargadores, they loaded, unloaded and piled sacks of palay from the warehouse to the cargo trucks and those brought by cargo trucks for delivery to different places. They were paid by Corfarm on a piece-rate basis. When Corfarm denied them some benefits, they formed their union. Corfarm replaced them with non-members of the union. Respondent Corfarm denies that it had the power of control over the complainants rationalizing that they were street-hired workers engaged from time to time to do loading and unloading work; there was no superintendent-incharge to give orders; and there were no gate passes issued, nor tools, equipment and paraphernalia issued by Cofarm for loading and unloading. It attributes error to the Solicitor General's reliance on Art. 280 of the Labor Code. Citing Brent School, Inc. vs. Zamora, private respondent asserts that a literal application of such article will result in “absurdity,” where petitioner’s members will be regular employees not only of respondents but also of several other rice mills, where they were allegedly also under service. Finally, Corfarm submits that the OSG’s position is negated by the fact that “petitioner’s members contracted for loading and unloading services with respondent company when such work was available and when they felt like it. ISSUE: Whether or not the street-hired cargadores are considered as regular emplyoyees. HELD: The court considers the cargadores as regular employee. It is undeniable that petitioner's members worked as cargadores for private respondent. They loaded, unloaded and piled sacks of palay from the warehouses to the cargo trucks and from the cargo trucks to the buyers. This work is directly related, necessary and vital to the operations of Cofarm. Moreover, Cofarm did not even allege, much less prove, that petitioner's members have substantial capital or investment in the form of tools, equipment, machineries, and work premises among others. Furthermore, said respondent did not contradict petitioner's allegation that it paid wages directly to these workers without the intervention of any third party independent contractor. It also wielded the power of dismissal over the petitioners. Clearly, the workers are not independent contractors.

RUGA ET. AL VS NLRC G.R. NO. L-72654-61 JANUARY 22, 1990 FERNAN, C.J.: FACTS: On September 11, 1983 upon arrival at the fishing port, petitioners were told by Jorge de Guzman, president of private respondent, to proceed to the police station at Camaligan, Camarines Sur, for investigation on the report that they sold some of their fish-catch at midsea to the prejudice of private respondent. Petitioners denied the charge claiming that the same was a countermove to their having formed a labor union and becoming members of Defender of Industrial Agricultural Labor Organizations and General Workers Union (DIALOGWU) on September 3, 1983. During the investigation, no witnesses were presented to prove the charge against petitioners, and no criminal charges were formally filed against them. Notwithstanding, private respondent refused to allow petitioners to return to the fishing vessel to resume their work on the same day, September 11, 1983. On September 22, 1983, petitioners individually filed their complaints for illegal dismissal and non-payment of 13th month pay, emergency cost of living allowance and service incentive pay, with the then Ministry (now Department) of Labor and Employment, Regional Arbitration Branch No. V, Legaspi City, Albay, docketed as Cases Nos. 1449-83 to 1456-83. 2 They uniformly contended that they were arbitrarily dismissed without being given ample time to look for a new job. On October 24, 1983, private respondent, thru its operations manager, Conrado S. de Guzman, submitted its position paper denying the employer-employee relationship between private respondent and petitioners on the theory that private respondent and petitioners were engaged in a joint venture. 3 After the parties failed to reach an amicable settlement, the Labor Arbiter scheduled the case for joint hearing furnishing the parties with notice and summons. On December 27, 1983, after two (2) previously scheduled joint hearings were postponed due to the absence of private respondent, one of the petitioners herein, Alipio Ruga, the pilot/captain of the 7/B Sandyman II, testified, among others, on the manner the fishing operations were conducted, mode of payment of compensation for services rendered by the fishermen-crew members, and the circumstances leading to their dismissal. 4 On March 31, 1984, after the case was submitted for resolution, Labor Arbiter Asisclo S. Coralde rendered a joint decision 5 dismissing all the complaints of

petitioners on a finding that a "joint fishing venture" and not one of employeremployee relationship existed between private respondent and petitioners. From the adverse decision against them, petitioners appealed to the National Labor Relations Commission. On May 30, 1985, the National Labor Relations Commission promulgated its resolution 6 affirming the decision of the labor arbiter that a "joint fishing venture" relationship existed between private respondent and petitioners. Issue: whether or not the fishermen-crew members of the trawl fishing vessel 7/B Sandyman II are employees of its owner-operator, De Guzman Fishing Enterprises, and if so, whether or not they were illegally dismissed from their employment. Held: Petitioners assail the ruling of the public respondent NLRC that what exists between private respondent and petitioners is a joint venture arrangement and not an employer-employee relationship. Aside from seeking the dismissal of the petition on the ground that the decision of the labor arbiter is now final and executory for failure of petitioners to file their appeal with the NLRC within 10 calendar days from receipt of said decision pursuant to the doctrine laid down in Vir-Jen Shipping and Marine Services, Inc. vs. NLRC, 115 SCRA 347 (1982), the Solicitor General claims that the ruling of public respondent that a "joint fishing venture" exists between private respondent and petitioners rests on the resolution of the Social Security System (SSS) in a 1968 case, Case No. 708 (De Guzman Fishing Enterprises vs. SSS), exempting De Guzman Fishing Enterprises, private respondent herein, from compulsory coverage of the SSS on the ground that there is no employeremployee relations between the boat-owner and the fishermen-crew members following the doctrine laid down in Pajarillo vs. SSS, 17 SCRA 1014 (1966). In applying to the case at bar the doctrine in Pajarillo vs. SSS, supra, that there is no employer-employee relationship between the boat-owner and the pilot and crew members when the boat-owner supplies the boat and equipment while the pilot and crew members contribute the corresponding labor and the parties get specific shares in the catch for their respective contribution to the venture, the Solicitor General pointed out that the boat-owners in the Pajarillo case, as in the case at bar, did not control the conduct of the fishing operations and the pilot and crew members shared in the catch. Fundamental considerations of substantial justice persuade Us to decide the instant case on the merits rather than to dismiss it on a mere technicality. In so doing, we exercise the prerogative accorded to this Court enunciated in Firestone Filipinas Employees Association, et al. vs. Firestone Tire and Rubber Co. of the Philippines, Inc., 61 SCRA 340 (1974), thus "the well-settled doctrine is that in labor cases before this Tribunal, no undue sympathy is to be accorded to any

claim of a procedural misstep, the idea being that its power be exercised according to justice and equity and substantial merits of the controversy." We have consistently ruled that in determining the existence of an employeremployee relationship, the elements that are generally considered are the following (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer's power to control the employee with respect to the means and methods by which the work is to be accomplished. The employment relation arises from contract of hire, express or implied. 9 In the absence of hiring, no actual employer-employee relation could exist. The conclusion of public respondent that there had been no change in the situation of the parties since 1968 when De Guzman Fishing Enterprises, private respondent herein, obtained a favorable judgment in Case No. 708 exempting it from compulsory coverage of the SSS law is not supported by evidence on record. It was erroneous for public respondent to apply the factual situation of the parties in the 1968 case to the instant case in the light of the changes in the conditions of employment agreed upon by the private respondent and petitioners as discussed earlier. While tenure or length of employment is not considered as the test of employment, nevertheless the hiring of petitioners to perform work which is necessary or desirable in the usual business or trade of private respondent for a period of 8-15 years since 1968 qualify them as regular employees within the meaning of Article 281 of the Labor Code as they were indeed engaged to perform activities usually necessary or desirable in the usual fishing business or occupation of private respondent. 14 Furthermore, the fact that on mere suspicion based on the reports that petitioners allegedly sold their fish-catch at midsea without the knowledge and consent of private respondent, petitioners were unjustifiably not allowed to board the fishing vessel on September 11, 1983 to resume their activities without giving them the opportunity to air their side on the accusation against them unmistakably reveals the disciplinary power exercised by private respondent over them and the corresponding sanction imposed in case of violation of any of its rules and regulations. The virtual dismissal of petitioners from their employment was characterized by undue haste when less extreme measures consistent with the requirements of due process should have been first exhausted. In that sense, the dismissal of petitioners was tainted with illegality. WHEREFORE, in view of the foregoing, the petition is GRANTED. The questioned resolution of the National Labor Relations Commission dated May 30,1985 is hereby REVERSED and SET ASIDE. Private respondent is ordered to reinstate petitioners to their former positions or any equivalent positions with 3year backwages and other monetary benefits under the law. No pronouncement as to costs.

SO ORDERED. MARAGUINOT AND P. ENERO VS NLRC AND VIVA FILMS GR NO. 120969 JANUARY 22, 1998 FACTS: Maraguinot and Enero were separately hired by Vic Del Rosario under Viva Films as part of the filming crew. Sometime in May 1992, sought the assistance of their supervisor to facilitate their request that their salary be adjusted in accordance with the minimum wage law. On June 1992, Mrs. Cesario, their supervisor, told them that Mr. Vic Del Rosario would agree to their request only if they sign a blank employment contract. Petitioners refused to sign such document. After which, the Mr. Enero was forced to go on leave on the same month and refused to take him back when he reported for work. Mr. Maraguinot on the other hand was dropped from the payroll but was returned days after. He was again asked to sign a blank employment contract but when he refused, he was terminated. Consequently, the petitioners sued for illegal dismissal before the Labor Arbiter. The private respondents claim the following: (a) that VIVA FILMS is the trade name of VIVA PRODUCTIONS, INC. and that it was primarily engaged in the distribution & exhibition of movies- but not then making of movies; (b) That they hire contractors called “producers” who act as independent contractors as that of Vic Del Rosario; and (c) As such, there is no employee-employer relation between petitioners and private respondents. The Labor Arbiter held that the complainants are employees of the private respondents. That the producers are not independent contractor but should be considered as labor-only contractors and as such act as mere agent of the real employer. Thus, the said employees are illegally dismissed. The private respondents appealed to the NLRC which reversed the decision of the Labor Arbiter declaring that the complainants were project employees due to the ff. reasons: (a) Complainants were hired for specific movie projects and their employment was co-terminus with each movie project; (b)The work is dependent on the availability of projects. As a result, the total working hours logged extremely varied; (c) The extremely irregular working days and hours of complainants work explains the lump sum payment for their service; and (d) The respondents alleged that the complainants are not prohibited from working with other movie companies whenever they are not working for the independent movie producers engaged by the respondents. A motion for reconsideration was filed by the complainants but was denied by NLRC. In effect, they filed an instant petition claiming that NLRC committed a

grave abuse of discretion in: (a) Finding that petitioners were project employees; (b) Ruling that petitioners were not illegally dismissed; and (c) Reversing the decision of the Labor Arbiter. In the instant case, the petitioners allege that the NLRC acted in total disregard of evidence material or decisive of the controversy. Issues: (a) W/N there exist an employee- employer relationship between the petitioners and the private respondents. (b) W/N the private respondents are engaged in the business of making movies. (c) W/N the producer is a job contractor. Held: There exist an employee- employer relationship between the petitioners and the private respondents because of the ff. reasons that nowhere in the appointment slip does it appear that it was the producer who hired the crew members. Moreover, it was VIVA’s corporate name appearing on heading of the slip. It can likewise be said that it was VIVA who paid for the petitioners’ salaries. Respondents also admit that the petitioners were part of a work pool wherein they attained the status of regular employees because of the ff. requisites: (a) There is a continuous rehiring of project employees even after cessation of a project; (b) The tasks performed by the alleged “project employees” are vital, necessary and indispensable to the usual business or trade of the employer; and (c) However, the length of time which the employees are continually re-hired is not controlling but merely serves as a badge of regular employment. Since the producer and the crew members are employees of VIVA and that these employees’ works deal with the making of movies. It can be said that VIVA is engaged of making movies and not on the mere distribution of such. The producer is not a job contractor because of the ff. reasons: (Sec. Rule VII, Book III of the Omnibus Rules Implementing the Labor Code.) a. A contractor carries on an independent business and undertakes the contract work on his own account under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof. The said producer has a fix time frame and budget to make the movies. b. The contractor should have substantial capital and materials necessary to

conduct his business. The said producer, Del Rosario, does not have his own tools, equipment, machinery, work premises and other materials to make motion pictures. Such materials were provided by VIVA. It can be said that the producers are labor-only contractors. Under Article 106 of the Labor Code (reworded) where the contractor does not have the requisites as that of the job contractors.

ORLANDO FARM GROWERS ASSOCIATION/GLICERIO AÑOVER VS. NLRC GR NO. 129076 NOVEMBER 25, 1998 Facts: Petitioner Orlando Farm Growers Association (Anover is the president) is an association of landowners engaged in the production of export quality bananas located in Kinamayan, Sto. Tomas, Davao del Norte, established for the sole purpose of dealing collectively with Stanfilco on matters concerning technical services, canal maintenance, irrigation and pest control, among others. Respondents (about 20 complainants) were hired as farm workers by several member-landowners but, nonetheless, were made to perform functions as packers and harvesters in the plantation of petitioner association.3.January 8, 1993 – July 30, 1994 –respondents were dismissed on various dates. Thus, they filed against petitioner for illegal dismissal and monetary benefits. Petitioner’s liabilities to complainants are joint and solidary, with its responsibleofficers.4.September 6, 1995 Issue: Whether or not an unregistered association may be an employer independent of the respective members it represents Held: YES. Petition is DISMISSED. NLRC judgment affirmed but remanded back to Labor Arbiter Sancho to specify the amount each respondent is entitled to. Ratio: The law does not require an employer to be registered before he may considered as one within the definition of the Labor Code. Art 212 (e) of the Labor Code defines an employer as any person acting inthe interest of an employer, directly or indirectly.

To determine the existence of employer – employee relationship (Filipinas Broadcasting Network v. NLRC):1.The manner of selection and engagement2.Payment of wages3.Presence or absence of the power of dismissal4.Presence or absence of the power of control (most important element. Evidence to support existence of employer – employee relationship. During the subsistence of the association, several circulars andmemoranda were issued concerning, among otherthings, absences without formal request, loit ering in the work area and disciplinarymeasures with which every worker is enjoined to comply.

NATIONAL SUGAR REFINERIES CORP. VS. NLRC G.R. NO. 101761 MARCH 24, 1993 REGALADO, J. Facts: Petitioner National Sugar Refineries Corporation (NASUREFCO), a corporation which is fully owned and controlled by the Government, operates three (3) sugar refineries located at Bukidnon, Iloilo and Batangas. The Batangas refinery was privatized on April 11, 1992 pursuant to Proclamation No. 50. Private respondent union represents the former supervisors of the NASUREFCO Batangas Sugar Refinery, namely, the Technical Assistant to the Refinery Operations Manager, Shift Sugar Warehouse Supervisor, Senior Financial/Budget Analyst, General Accountant, Cost Accountant, Sugar Accountant, Junior Financial/Budget Analyst, Shift Boiler Supervisor,, Shift Operations Chemist, Shift Electrical Supervisor, General Services Supervisor, Instrumentation Supervisor, Community Development Officer, Employment and Training Supervisor, Assistant Safety and Security Officer, Head and Personnel Services, Head Nurse, Property Warehouse Supervisor, Head of Inventory Control Section, Shift Process Supervisor, Day Maintenance Supervisor and Motorpool Supervisor. On June 1, 1988, petitioner implemented a Job Evaluation (JE) Program affecting all employees, from rank-and-file to department heads which was designed to rationalized the duties and functions of all positions, reestablish levels of responsibility, and recognize both wage and operational structures. Jobs were ranked according to effort, responsibility, training and working conditions and relative worth of the job. As a result, all positions were re-evaluated, and all employees including the members of respondent union were granted salary adjustments and increases in benefits commensurate to their actual duties and functions.

The Courts glean from the records that for about ten years prior to the JE Program, the members of respondent union were treated in the same manner as rank-and file employees. As such, they used to be paid overtime, rest day and holiday pay pursuant to the provisions of Articles 87, 93 and 94 of the Labor Code as amended. On May 11, 1990, petitioner NASUREFCO recognized herein respondent union, which was organized pursuant to Republic Act NO. 6715 allowing supervisory employees to form their own unions, as the bargaining representative of all the supervisory employees at the NASUREFCO Batangas Sugar Refinery. Two years after the implementation of the JE Program, specifically on June 20, 1990, the members of herein respondent union filed a complainant with the executive labor arbiter for non-payment of overtime, rest day and holiday pay allegedly in violation of Article 100 of the Labor Code. Issue: Whether or not the members of respondent union are entitled to overtime, rest day and holiday pay. Ruling: The members of the union are not entitled to overtime, rest and holiday pay since they fall within the classification of managerial employees which makes them a part of the exempted employees. It must of necessity be ascertained first whether or not the union members, as supervisory employees, are to be considered as officers or members of the managerial staff who are exempt from the coverage of Article 82 of the Labor Code. It is not disputed that the members of respondent union are supervisory employees, as defined employees, as defined under Article 212(m), Book V of the Labor Code on Labor Relations, which reads: “'Managerial employee' is one who is vested with powers or prerogatives to lay down and execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharged, assign or discipline employees. Supervisory employees are those who, in the interest of the employer effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment. All employees not falling within any of those above definitions are considered rank-and-file employees of this Book." Article 82 of the Labor Code states: “The provisions of this title shall apply to employees in all establishments and undertakings whether for profit or not, but not to government employees, managerial employees, field personnel, members of the family of the employer who are dependent on him for support, domestic helpers, persons in the personal service of another, and workers who are paid by results as determined by the Secretary of Labor in Appropriate regulations.” As used herein, 'managerial employees' refer to those whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision thereof, and to other officers or members of the managerial staff.

They are clearly officers or members of the managerial staff because they meet all the conditions prescribed by law and, hence, they are not entitled to overtime, rest day and supervisory employees under Article 212 (m) should be made to apply only to the provisions on Labor Relations, while the right of said employees to the questioned benefits should be considered in the light of the meaning of a managerial employee and of the officers or members of the managerial staff, as contemplated under Article 82 of the Code and Section 2, Rule I Book III of the implementing rules. In other words, for purposes of forming and joining unions, certification elections, collective bargaining, and so forth, the union members are supervisory employees. In terms of working conditions and rest periods and entitlement to the questioned benefits, however, they are officers or members of the managerial staff, hence they are not entitled thereto. The union members will readily show that these supervisory employees are under the direct supervision of their respective department superintendents and that generally they assist the latter in planning, organizing, staffing, directing, controlling communicating and in making decisions in attaining the company's set goals and objectives. These supervisory employees are likewise responsible for the effective and efficient operation of their respective departments. Under the facts obtaining in this case, The Court is constrained to agree with petitioner that the union members should be considered as officers and members of the managerial staff and are, therefore, exempt from the coverage of Article 82. Perforce, they are not entitled to overtime, rest day and holiday. PENARANDA VS. BAGANGA PLYWOOD CORP. G.R. NO. 159577 MAY 3, 2006 PANGANIBAN, C.J. Facts: in June 1999, Petitioner Charlito Peñaranda was hired as an employee of Baganga Plywood Corporation (BPC) to take charge of the operations and maintenance of its steam plant boiler. In May 2001, Peñaranda filed a Complaint for illegal dismissal with money claims against BPC and its general manager, Hudson Chua, before the NLRC. Due to the fact that the parties failed to settle amicably, the labor arbiter directed the parties to file their position papers. "[Peñaranda] through counsel in his position paper alleges that he was employed by respondent [Baganga] on March 15, 1999 with a monthly salary of P5,000.00 as Foreman/Boiler Head/Shift Engineer until he was illegally terminated on December 19, 2000. Further, [he] alleges that his services [were] terminated without the benefit of due process and valid grounds in accordance with law. Furthermore, he was not paid his overtime pay, premium pay for working during

holidays/rest days, night shift differentials and finally claims for payment of damages and attorney’s fees having been forced to litigate the present complaint.” "Upon the other hand, respondent [BPC] is a domestic corporation duly organized and existing under Philippine laws and is represented herein by its General Manager HUDSON CHUA, [the] individual respondent. Respondents thru counsel allege that complainant’s separation from service was done pursuant to Art. 283 of the Labor Code. The respondent [BPC] was on temporary closure due to repair and general maintenance and it applied for clearance with the Department of Labor and Employment, Regional Office No. XI to shut down and to dismiss employees (par. 2 position paper). And due to the insistence of herein complainant he was paid his separation benefits (Annexes C and D, ibid). Consequently, when respondent [BPC] partially reopened in January 2001, [Peñaranda] failed to reapply. Hence, he was not terminated from employment much less illegally. He opted to severe employment when he insisted payment of his separation benefits. Furthermore, being a managerial employee he is not entitled to overtime pay and if ever he rendered services beyond the normal hours of work, [there] was no office order/or authorization for him to do so. Finally, respondents allege that the claim for damages has no legal and factual basis and that the instant complaint must necessarily fail for lack of merit." Ruling of the NLRC: Respondents filed an appeal to the NLRC, which deleted the award of overtime pay and premium pay for working on rest days. According to the Commission, petitioner was not entitled to these awards because he was a managerial employee. Ruling of the Court of Appeals: In its Resolution dated January 27, 2003, the CA dismissed Peñaranda’s Petition for Certiorari. The appellate court held that he failed to: 1) attach copies of the pleadings submitted before the labor arbiter and NLRC; and 2) explain why the filing and service of the Petition was not done by personal service. In its later Resolution dated July 4, 2003, the CA denied reconsideration on the ground that petitioner still failed to submit the pleadings filed before the NLRC. Issue: Whether or not Penaranda is entitled to overtime pay and premium pay for working on rest days. Held: Article 82 of the Labor Code exempts managerial employees from the coverage of labor standards. Labor standards provide the working conditions of employees, including entitlement to overtime pay and premium pay for working on rest days.29 Under this provision, managerial employees are "those whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision." The Court disagrees with the NLRC’s finding that petitioner was a managerial employee. However, petitioner was a member of the managerial staff, which also

takes him out of the coverage of labor standards. Like managerial employees, officers and members of the managerial staff are not entitled to the provisions of law on labor standards. Even petitioner admitted that he was a supervisor. In his Position Paper, he stated that he was the foreman responsible for the operation of the boiler. The term foreman implies that he was the representative of management over the workers and the operation of the department. Petitioner’s evidence also showed that he was the supervisor of the steam plant. His classification as supervisor is further evident from the manner his salary was paid. He belonged to the 10% of respondent’s 354 employees who were paid on a monthly basis; the others were paid only on a daily basis. On the basis of the foregoing, the Court finds no justification to award overtime pay and premium pay for rest days to petitioner. Wherefore, the petition is denied. costs against petitioner. AUTO BUS TRANSPORT SYSTEMS, INC., VS. BAUTISTA G.R. NO. 156367 MAY 16, 2005 CHICO-NAZARIO, J. Facts: Antonio Bautista has been employed by petitioner Auto Bus Transport Systems, Inc. (Autobus), as driver-conductor with travel routes Manila-Tuguegarao via Baguio, Baguio- Tuguegarao via Manila and Manila-Tabuk via Baguio. Respondent was paid on commission basis, seven percent (7%) of the total gross income per travel, on a twice a month basis.On 03 January 2000, while respondent was driving Autobus No. 114 along Sta. Fe, Nueva Vizcaya, the bus he was driving accidentally bumped the rear portion of Autobus No. 124, as the latter vehicle suddenly stopped at a sharp curve without giving any warning.Respondent further alleged that he was not allowed to work until he fully paid the amount of P75,551.50, representing thirty percent (30%) of the cost of repair of the damaged buses and that despite respondent’s pleas for reconsideration, the same was ignored by management. After a month, management sent him a letter of termination. Respondent instituted a Complaint for Illegal Dismissal with Money Claims for nonpayment of 13th month pay and service incentive leave pay against Autobus. Issue: Whether the private respondent is considered as field personel in which case, he is exempted from incentive leave pay under Book III, Rule V, Section 1(d). Held: No. According to the Implementing Rules, Service Incentive Leave shall not apply to employees classified as "field personnel." The phrase "other employees whose performance is unsupervised by the employer" must not be understood as a separate classification of employees to which service incentive leave shall not be granted. Rather, it serves as an amplification of the interpretation of the

definition of field personnel under the Labor Code as those "whose actual hours of work in the field cannot be determined with reasonable certainty."8 The same is true with respect to the phrase "those who are engaged on task or contract basis, purely commission basis." Said phrase should be related with "field personnel," applying the rule on ejusdem generis that general and unlimited terms are restrained and limited by the particular terms that they follow. Hence, employees engaged on task or contract basis or paid on purely commission basis are not automatically exempted from the grant of service incentive leave, unless, they fall under the classification of field personnel. Therefore, petitioner’s contention that respondent is not entitled to the grant of service incentive leave just because he was paid on purely commission basis is misplaced. What must be ascertained in order to resolve the issue of propriety of the grant of service incentive leave to respondent is whether or not he is a field personnel. As a general rule, [field personnel] are those whose performance of their job/service is not supervised by the employer or his representative, the workplace being away from the principal office and whose hours and days of work cannot be determined with reasonable certainty; hence, they are paid specific amount for rendering specific service or performing specific work. If required to be at specific places at specific times, employees including drivers cannot be said to be field personnel despite the fact that they are performing work away from the principal office of the employee. The definition of a "field personnel" is not merely concerned with the location where the employee regularly performs his duties but also with the fact that the employee’s performance is unsupervised by the employer. Field personnel are those who regularly perform their duties away from the principal place of business of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty. Thus, in order to conclude whether an employee is a field employee, it is also necessary to ascertain if actual hours of work in the field can be determined with reasonable certainty by the employer. In so doing, an inquiry must be made as to whether or not the employee’s time and performance are constantly supervised by the employer. UNION OF FILIPINO EMPLOYEES VS VIVAR G..R. NO. 79255 JANUARY 20, 1992 GUTIERREZ, JR., J. Facts: This labor dispute stems from the exclusion of sales personnel from the holiday pay award and the change of the divisor in the computation of benefits

from 251 to 261 days. On November 8, 1985, respondent Filipro, Inc. (now Nestle Philippines, Inc.) filed with the National Labor Relations Commission (NLRC) a petition for declaratory relief seeking a ruling on its rights and obligations respecting claims of its monthly paid employees for holiday pay in the light of the Court's decision in Chartered Bank Employees Association v. Ople (138 SCRA 273 [1985]). Both Filipro and the Union of Filipino Employees (UFE) agreed to submit the case for voluntary arbitration and appointed respondent Benigno Vivar, Jr. as voluntary arbitrator. Filipro filed a motion for clarification seeking (1) the limitation of the award to three years, (2) the exclusion of salesmen, sales representatives, truck drivers, merchandisers and medical representatives (hereinafter referred to as sales personnel) from the award of the holiday pay, and (3) deduction from the holiday pay award of overpayment for overtime, night differential, vacation and sick leave benefits due to the use of 251 divisor. Petitioner UFE answered that the award should be made effective from the date of effectivity of the Labor Code, that their sales personnel are not field personnel and are therefore entitled to holiday pay, and that the use of 251 as divisor is an established employee benefit which cannot be diminished. Issue: WON the respondent's sales personnel are not field personnel under Article 82 of the Labor Code? Held: The criteria for granting incentive bonus are: (1) attaining or exceeding sales volume based on sales target; (2) good collection performance; (3) proper compliance with good market hygiene; (4) good merchandising work; (5) minimal market returns; and (6) proper truck maintenance. The Court thereby resolves that the grant of holiday pay be effective, not from the date of promulgation of the Chartered Bank case or from the date of effectivity of the Labor Code, but from October 23, 1984, the date of promulgation of the IBAA case. SAN MIGUEL BREWERY V. DEMOCRATIC LABOR ORGANIZATION 8 SCRA 613 JULY 31, 1963 FACTS: The Democratic Labor Association filed a complaint against the San Miguel Brewery, Inc., embodying 12 demands for the betterment of the conditions of employment of its members. The company filed its answer to the complaint specifically denying its material averments and answering the

demands point by point. The company asked for the dismissal of the complaint. During the hearing, the union manifested its desire to confine its claim to its demands for overtime, night-shift differential pay, and attorney's fees, although it was allowed to present evidence on service rendered during Sundays and holidays, or on its claim for additional separation pay and sick and vacation leave compensation. After the case had been submitted for decision, Presiding Judge Jose S. Bautista, who was commissioned to receive the evidence, rendered decision expressing his disposition with regard to the points embodied in the complaint on which evidence, was presented. The demands for the application of the Minimum Wage Law to workers paid on"pakiao" basis, payment of accumulated vacation and sick leave and attorney's fees, as well as the award of additional separation pay, were either dismissed, denied, or set aside. Its motion for reconsideration having been denied by the industrial court en bane, which affirmed the decision of the court a quo with few exceptions, the San Miguel Brewery, Inc. interposed the present petition for review. ISSUE: Whether or not outside or field sales personnel are entitled to the benefits of the Eight-Hour Labor Law. HELD: NO. After the morning roll call, the employees leave the plant of the company to go on their respective sales routes and they do not have a daily time record but the sales routes are so planned that they can be completed within 8 hours at most, and they receive monthly salaries and sales commission in variable amounts, so that they are made to work beyond the required eight hours similar to piecework, "pakiao", or commission basis regardless of the time employed, and the employees' participation depends on their industry, it is held that the Eight-Hour Labor Law has no application to said outside or field sales personnel and that they are not entitled to overtime pay. The Court is in the opinion that the Eight-Hour Labor Law only has application where an employee or laborer is paid in a monthly or daily basis, or is paid a monthly or daily compensation, in which case, if he is made to work beyond the requisite period of 8 hours, he should be paid the additional compensation prescribed by law. This law has no application when the employee or laborer is paid on a piece-work, "pakiao", or commission basis, regardless of the time employed. The philosophy behind this exemption is that his earnings are in the form of commission based on the gross receipts of the day. His participation depends upon his industry so that the more hours he employs in the work the greater are his gross returns and the higher his commission. This philosophy is better explained in Jewel Tea Co. vs. Willams , C.C.A. Okl., 118 F. 2d 202, as follows:"The reasons for excluding an outside salesman are fairly apparent. Such salesman, to a great extent, works individually. There are no restrictions respecting the time he shall work and he can earn as much or as little, within the range of his ability, as his ambition dictates. In lieu of overtime he ordinarily receives commissions as extra compensation. He works away from his employer's

place of business, is not subject to the personal supervision of his employer, and his employer has no way of knowing the number of hours he works per day." MANUEL LARA, ET.Al., vs. PETROLINO DEL ROSRIO, JR. G.R. No. L-6339 April 20, 1954 FACTS In 1950 defendant Petronilo Del Rosario, Jr., owner of twenty-five taxi cabs or cars, operated a taxi business under the name of “Waval Taxi.” He employed among others three mechanics and 49 chauffeurs or drivers, the latter having worked for periods ranging from 2 to 37 months. On September 4, 1950, without giving said mechanics and chauffeurs 30 days advance notice, Del Rosario sold his 25 units or cabs to La Mallorca, a transportation company, as a result of which, according to the mechanics and chauffeurs above-mentioned they lost their jobs because the La Mallorca failed to continue them in their employment. They brought this action against Del Rosario to recover compensation for overtime work rendered beyond eight hours and on Sundays and legal holidays, and one month salary (mesada) provided for in article 302 of the Code of Commerce because the failure of their former employer to give them one month notices. Subsequently, the three mechanics unconditionally withdrew their claims. So only the 49 drivers remained as plaintiffs. ISSUE Whether or not the claim of the plaintiffs-appellants for overtime compensation under the Eight-Hour Labor Law is valid. RULING The Supreme Court held that the month pay (mesada) under article 302 of the Code of Commerce, article 2270 of the new Civil Code (Republic Act 386) appears to have repealed said Article 302 when it repealed the provisions of the Code of Commerce governing Agency. This repeal took place on August 30, 1950, when the new Civil Code went into effect, that is, one year after its publication in the Official Gazette. The alleged termination of services of the plaintiffs by the defendant took place according to the complaint on September 4, 1950, that is to say, after the repeal of Article 302 which they invoke. Moreover, said Article 302 of the Code of Commerce, assuming that it were still in force speaks of “salary

corresponding to said month.” commonly known as “mesada.” If the plaintiffs herein had no fixed salary either by the day, week, or month, then computation of the month’s salary payable would be impossible. Article 302 refers to employees receiving a fixed salary.

MANILA TERMINAL CO. INC., VS. CIR, ET AL. G.R. NO. L-4148 JULY 16, 1952 PARAS, CJ. FACTS: On September 1, 1945, the Manila Terminal Company, Inc. hereinafter to be referred as to the petitioner, undertook the arrastre service in some of the piers in Manila's Port Area at the request and under the control of the United States Army. The petitioner hired some thirty men as watchmen on twelve-hour shifts at a compensation of P3 per day for the day shift and P6 per day for the night shift. On February 1, 1946, the petitioner began the postwar operation of the arrastre service at the present at the request and under the control of the Bureau of Customs, by virtue of a contract entered into with the Philippine Government. The watchmen of the petitioner continued in the service with a number of substitutions and additions, their salaries having been raised during the month of February to P4 per day for the day shift and P6.25 per day for the nightshift. On March 28, 1947, Dominador Jimenez, a member of the Manila Terminal Relief and Mutual Aid Association, sent a letter to the Department of Labor, requesting that the matter of overtime pay be investigated, but nothing was done by the Department. On April 29, 1947, Victorino Magno Cruz and five other employees, also member of the Manila Transit Mutual Aid Association, filed a 5-point demand with the Department of Labor, including overtime pay, but the Department again filed to do anything about the matter. On May 27, 1947, the petitioner instituted the system of strict eight-hour shifts. On June 19, 1947, the Manila Port Terminal Police Association, not registered in accordance with the provisions of Commonwealth Act No. 213, filed a petition with the Court of Industrial Relations. On July 16, 1947, the Manila Terminal Relief and Mutual Aid Association was organized for the first time, having been granted certificate No. 375 by the Department of Labor. On July 28, 1947, Manila Terminal Relief and Mutual Aid Association filed an amended petition with the Court of Industrial Relations praying, among others, that the petitioner be ordered to pay its watchmen or police force overtime pay from the commencement of their employment. On May 9, 1949, by virtue of Customs Administrative Order No. 81 and Executive Order No. 228 of the President of the Philippines, the entire police force of the petitioner was consolidated with the Manila Harvor Police of the Customs Patrol Service, a Government agency under the exclusive control of the

Commissioner of Customs and the Secretary of Finance The Manila Terminal Relief and Mutual Aid Association will hereafter be referred to as the Association. Judge V. Jimenez Yanson of the Court of Industrial Relations in his decision of April 1, 1950, as amended on April 18, 1950, while dismissing other demands of the Association for lack of jurisdiction, ordered the petitioner to pay to its police force — Regular or base pay corresponding to four hours' overtime plus 25 per cent thereof as additional overtime compensation for the period from September 1, 1945 to May 24, 1947; Additional compensation of 25 per cent to those who worked from 6:00 p.m. to 6:00 a.m. during the same period: Additional compensation of 50 per cent for work performed on Sundays and legal holidays during the same period; Additional compensation of 50 per cent for work performed on Sundays and legal holidays from May 24, 1947 to May 9, 1949; and Additional compensation of 25 per cent for work performed at night from May 29, 1947 to May 9, 1949. With reference to the pay for overtime service after the watchmen had been integrated into the Manila Harbor Police, Judge Yanson ruled that the court has no jurisdiction because it affects the Bureau of Customs, an instrumentality of the Government having no independent personality and which cannot be sued without the consent of the State. (Metran vs. Paredes, 45. Off. Gaz., 2835.) The petitioner find a motion for reconsideration. The Association also filed a motion for reconsideration in so far its other demands were dismissed. Judge Yanson, concurred in by Judge Jose S. Bautista, promulgated on July 13, 1950, a resolution denying both motions for reconsideration. Presiding Judge Arsenio C. Roldan, in a separate opinion concurred in by Judge Modesto Castillo, agreed with the decision of Judge Yanson of April 1, 1950, as to the dismissal of other demands of the Association, but dissented therefrom as to the granting of overtime pay. In a separate decisive opinion, Judge Juan S. Lanting concurred in the dismissal of other demands of the Association. With respect to overtime compensation, Judge Lanting ruled: The decision under review should be affirmed in so far it grants compensation for overtime on regular days (not Sunday and legal holidays)during the period from the date of entrance to duty to May 24, 1947, such compensation to consists of the amount corresponding to the four hours' overtime at the regular rate and an additional amount of 25 per cent thereof. As to the compensation for work on Sundays and legal holidays, the petitioner should pay to its watchmen the compensation that corresponds to the overtime (in excess of 8 hours) at the regular rate only, that is, without any additional amount, thus modifying the decision under review accordingly. The watchmen are not entitled to night differential pay for past services, and therefore the decision should be reversed with the respect thereto.

The petitioner has filed a present petition for certiorari. ISSUE: Whether or not he petitioner's watchmen is entitled to extra compensation for past overtime work. HELD: Sections 3 and 5 of Commonwealth Act 444 expressly provides for the payment of extra compensation in cases where overtime services are required, with the result that the employees or laborers are entitled to collect such extra compensation for past overtime work. INTERPHIL LABORATORIES EMPLOYEES UNION- FFW, ET. AL VS. INTERPHIL LABORATORIES G.R. NO. 142824 DECEMBER 19, 2001 KAPUNAN, J. FACTS: Interphil Laboratories Employees Union-FFW is the sole and exclusive bargaining agent of the rank-and-file employees of Interphil Laboratories, Inc., a company engaged in the business of manufacturing and packaging pharmaceutical products. They had a Collective Bargaining Agreement (CBA) effective from 01 August 1990 to 31 July 1993. Prior to the expiration of the CBA or sometime in February 1993, Allesandro G. Salazar,1Vice-President-Human Resources Department of respondent company, was approached by Nestor Ocampo, the union president, and Hernando Clemente, a union director. The two union officers inquired about the stand of the company regarding the duration of the CBA which was set to expire in a few months. Salazar told the union officers that the matter could be best discussed during the formal negotiations which would start soon. In March 1993, Ocampo and Clemente again approached Salazar. They inquired once more about the CBA status and received the same reply from Salazar. In April 1993, Ocampo requested for a meeting to discuss the duration and effectivity of the CBA. Salazar acceded and a meeting was held on 15 April 1993 where the union officers asked whether Salazar would be amenable to make the new CBA effective for two (2) years, starting 01 August 1993. Salazar, however, declared that it would still be premature to discuss the matter and that the company could not make a decision at the moment. The very next day, or on 16 April 1993, all the rank-and-file employees of the company refused to follow their regular two-shift work schedule of from 6:00 a.m. to 6:00 p.m., and from 6:00 p.m. to 6:00 a.m. At 2:00 p.m. and 2:00 a.m., respectively, the employees stopped working and left their workplace without sealing the containers and securing the raw materials they were working on When Salazar inquired about

the reason for their refusal to follow their normal work schedule, the employees told him to "ask the union officers." To minimize the damage the overtime boycott was causing the company, Salazar immediately asked for a meeting with the union officers. In the meeting, Enrico Gonzales, a union director, told Salazar that the employees would only return to their normal work schedule if the company would agree to their demands as to the effectivity and duration of the new CBA. Salazar again told the union officers that the matter could be better discussed during the formal renegotiations of the CBA. Since the union was apparently unsatisfied with the answer of the company, the overtime boycott continued. In addition, the employees started to engage in a work slowdown campaign during the time they were working, thus substantially delaying the production of the company. On 14 May 1993, petitioner union submitted with respondent company its CBA proposal, and the latter filed its counter-proposal. On 03 September 1993, respondent company filed with the National Labor Relations Commission (NLRC) a petition to declare illegal petitioner union's "overtime boycott" and "work slowdown" which, according to respondent company, amounted to illegal strike. The case, docketed NLRC-NCR Case No. 00-09-05529-93, was assigned to Labor Arbiter Manuel R. Caday. On 22 October 1993, respondent company filed with the National Conciliation and Mediation Board (NCMB) an urgent request for preventive mediation aimed to help the parties in their CBAnegotiations.3The parties, however, failed to arrive at an agreement and on 15 November 1993, respondent company filed with the Office of the Secretary of Labor and Employment a petition for assumption of jurisdiction. On 24 January 1994, petitioner union filed with the NCMB a Notice of Strike citing unfair labor practice allegedly committed by respondent company. On 12 February 1994, the union staged a strike. On 14 February 1994, Secretary of Labor Nieves Confesor issued an assumption order 4over the labor dispute. On 02 March 1994, Secretary Confesor issued an order directing respondent company to "immediately accept all striking workers, including the fifty-three (53) terminated union officers, shop stewards and union members back to work under the same terms and conditions prevailing prior to the strike, and to pay all the unpaid accrued year end benefits of its employees in 1993. "On 05 September 1995, Labor Arbiter Caday submitted his recommendation to the then Secretary of Labor Leonardo A. Quisumbing.8Then Secretary Quisumbing approved and adopted the report in his Order, dated 13 August 1997. Hence, the present recourse where petitioner alleged Issue: Whether or not the Honorable Fifth Division of Court of Appeals committed grave abuse?

Ruling: On the matter of the authority and jurisdiction of the Secretary of Labor and Employment to rule on the illegal strike committed by petitioner union, it is undisputed that the petition to declare the strike illegal before Labor Arbiter Caday was filed long before the Secretary of Labor and Employment issued the assumption order on 14 February 1994.However, it cannot be denied that the issues of "overtime boycott" and "work slowdown" amounting to illegal strike before Labor Arbiter Caday are intertwined with the labor dispute before the Labor Secretary. In fact, on 16 March 1994, petitioner union even asked Labor Arbiter Caday to suspend the proceedings before him and consolidate the same with the case before the Secretary of Labor. The appellate court also correctly held that the question of the Secretary of Labor and Employment's jurisdiction over labor and labor-related disputes was already settled in International Pharmaceutical, Inc. vs. Hon. Secretary of Labor and Associated Labor Union (ALU). Anent the alleged misappreciation of the evidence proffered by the parties, it is axiomatic that the factual findings of the Labor Arbiter, when sufficiently supported by the evidence on record, must be accorded due respect by the Supreme Court.12Here, the report and recommendation of Labor Arbiter Caday was not only adopted by then Secretary of Labor Quisumbing but was likewise affirmed by the Court of Appeals. We see no reason to depart from their findings. WHEREFORE, the petition is DENIED DUE COURSE and the 29 December 1999 decision of the Court of Appeals is AFFIRMED.SO ORDERED. PAN AMERICAN WOLRD AIRWAYS SYSTEM VS. PAN AMERICAN EMPLOYEES ASSOC. G.R. NO.:L – 16275 FEBRUARY 23, 1961 J. REYES, J.B.L. FACTS: Appeal by certiorari from the decision of the Court of Industrial Relations in case No. 1055 –V dated October 10, 1959, and its resolution en banc denying the motion for reconsideration by the petitioner herein. The Court orders to compute the overtime compensation due the aforesaid fourteen (14) aircraft mechanic and the 2 employees from the Communication Department based on the time sheet of said employees from February 23, 1952 – July 15, 1958 and to submit his report within 30 days for further disposition by the court. Petitioner contends that the finding of that the 1 – hour meal period should be considered work(deducting 15 minutes as time allowed for eating) is not supported by substantial evidence.

ISSUE: Whether or not the 1 hour meal period should be considered as overtime work (after deducting 15minutes)? HELD: Yes. The Court ruled that during the so called meal period, the mechanics were required to standby for emergency work; that if they happened not to be available when called, they were reprimanded by the lead man; that as in fact it happened on many occasions, the mechanics had been called from their meals or told to hurry Employees Association up eating to perform work during this period. Judgment appealed from is affirmed. Cost against appellant. UNIVERSITY OF PANGASINAN FACULTY UNION V. UNIVERSITY OF PANGASINAN G.R. NO. L-63122 FEBRUARY 20, 1984 GUTIERREZ, JR., J. LABOR AND SOCIAL LEGISLATIONS; LABOR LAWS; PRESIDENTIAL DECREES ON EMERGENCY COST OF LIVING ALLOWANCE; REQUISITES FOR ENTITLEMENT TO ALLOWANCES PROVIDED THEREUNDER. 2. "NO WORK, NO PAY" PRINCIPLE NOT APPLICABLE’ CASE AT BAR. 3. EMPLOYEES WHETHER PAID ON MONTHLY OR DAILY BASIS ENTITLED TO DAILY LIVING ALLOWANCE WHEN PAID THEIR BASIC WAGE. PURPOSE OF THE LAW. 5. PRESIDENTIAL DECREE 451; CONSTRUED. REMEDIAL LAW; APPEALS; FINDINGS OF FACT OF NATIONAL LABOR RELATIONS COMMISSION ARE BINDING WHEN FULLY SUBSTANTIATED BY EVIDENCE. Facts: On December 18, 1981, the petitioner, through its President, Miss Consuelo Abad, filed a complaint against the private respondent with the Arbitration Branch of the NLRC, Dagupan District Office, Dagupan City. The complaint seeks: (a) the payment of Emergency Cost of Living Allowances (ECOLA) for November 7 to December 5, 1981, a semestral break; (b) salary increases from the sixty (60%) percent of the incremental proceeds of increased tuition fees; and (c) payment of salaries for suspended extra loads. The petitioner’s members are full-time professors, instructors, and teachers of respondent University. The teachers in the college level teach for a normal duration of ten (10) months a school year, divided into two (2) semesters of five (5) months each, excluding the two (2) months summer vacation. These teachers are paid their salaries on a regular monthly basis. In November and December, 1981, the petitioner’s members were fully paid their regular monthly salaries. However, from November 7 to December 5, during the semestral break, they were not paid their ECOLA. The private respondent claims

that the teachers are not entitled thereto because the semestral break is not an integral part of the school year and there being no actual services rendered by the teachers during said period, the principle of "No work, no pay" applies. During the same school year (1981-1982), the private respondent was authorized by the Ministry of Education and Culture to collect, as it did collect, from its students a fifteen (15%) percent increase of tuition fees. Petitioner’s members demanded a salary increase effective the first semester of said schoolyear to be taken from the sixty (60%) percent incremental proceeds of the increased tuition fees. Private respondent refused, compelling the petitioner to include said demand in the complaint filed in the case at bar. While the complaint was pending in the arbitration branch, the private respondent granted an across-theboard salary increase of 5.86%. Nonetheless, the petitioner is still pursuing full distribution of the 60% of the incremental proceeds as mandated by the Presidential Decree No. 451. Aside from their regular loads, some of petitioner’s members were given extra loads to handle during the same 1981-1982 schoolyear. Some of them had extra loads to teach on September 21, 1981, but they were unable to teach as classes in all levels throughout the country were suspended, although said days was proclaimed by the President of the Philippines as a working holiday. Those with extra loads to teach on said day claimed they were not paid their salaries for those loads, but the private respondent claims otherwise. Issue: "WHETHER OR NOT PETITIONER’S MEMBERS ARE ENTITLED TO ECOLA DURING THE SEMESTRAL BREAK FROM NOVEMBER 7 TO DECEMBER 5, 1981 OF THE 1981-82 SCHOOL YEAR. "WHETHER OR NOT 60% OF THE INCREMENTAL PROCEEDS OF INCREASED TUITION FEES SHALL BE DEVOTED EXCLUSIVELY TO SALARY INCREASE, "WHETHER OR NOT ALLEGED PAYMENT OF SALARIES FOR EXTRA LOADS ON SEPTEMBER 21, 1981 WAS PROVEN BY SUBSTANTIAL EVIDENCE."cralaw virtua1aw library Held: It is beyond dispute that the petitioner’s members are full-time employees receiving their monthly salaries irrespective of the number of working days or teaching hours in a month. However, they find themselves in a most peculiar situation whereby they are forced to go on leave during semestral breaks. These semestral breaks are in the nature of work interruptions beyond the employees’ control. The duration of the semestral break varies from year to year dependent on a variety of circumstances affecting at times only the private respondent but at other times all educational institutions in the country. As such, these breaks cannot be considered as absences within the meaning of the law for which deductions may be made from monthly allowances. The "No work, no pay" principle does not apply in the instant case. The petitioner’s members received

their regular salaries during this period. It is clear from the aforequoted provision of law that it contemplates a "no work" situation where the employees voluntarily absent themselves. Petitioners, in the case at bar, certainly do not, ad voluntatem, absent themselves during semestral breaks. Rather, they are constrained to take mandatory leave from work. For this they cannot be faulted nor can they be begrudged that which is due them under the law. To a certain extent, the private respondent can specify dates when no classes would be held. Surely, it was not the intention of the framers of the law to allow employers to withhold employee benefits by the simple expedient of unilaterally imposing "no work" days and consequently avoiding compliance with the mandate of the law for those days.chanrobles.com.ph : virtual law library. This Court is not guilty of usurpation of legislative functions as claimed by the respondents. We expressed the opinion in the University of the East case that benefits mandated by law and collective bargaining may be charged to the 12% return on investments within the 40% incremental proceeds of tuition increase. As admitted by respondent, we merely made this statement as a suggestion in answer to the respondent’s query as to where then, under the law, can such benefits be charged. We were merely interpreting the meaning of the law within the confines of its provisions. The law provides that 60% should go to wage increases and 40% to institutional developments, student assistance, extension services, and return on investments (ROI). Under the law, the last item ROI has flexibility sufficient to accommodate other purposes of the law and the needs of the university. ROI is not set aside for any one purpose of the university such as profits or returns on investments. The amount may be used to comply with other duties and obligations imposed by law which the university exercising managerial prerogatives finds cannot under present circumstances, be funded by other revenue sources. It may be applied to any other collateral purpose of the university or invested elsewhere. Hence, the framers of the law intended this portion of the increases in tuition fees to be a general fund to cover up for the university’s miscellaneous expenses and, precisely, for this reason, it was not so delimited. Besides, ROI is a return or profit over and above the operating expenditures of the university, and still, over and above the profits it may have had prior to the tuition increase. The earning capacities of private educational institutions are not dependent on the increases in tuition fees allowed by P.D. 451. Accommodation of the allowances required by law require wise and prudent management of all the university resources together with the incremental proceeds of tuition increases. Cognizance should be taken of the fact that the private respondent had, before PD 451, managed to grant all allowances required by law. It cannot now claim that it could not afford the same, considering that additional funds are even granted them by the law in question. We find no compelling reason, therefore, to deviate from our previous ruling in the University of the East case even as we take the second hard look at the decision requested by the private Respondent. This case was decided in 1982 when PDs 1614, 1634, 1678, and 1713 which are also the various Presidential Decrees on ECOLA were already in force. PD 451 was interpreted in the light of these subsequent legislations which bear upon but do not modify nor amend, the same.

We need not go beyond the ruling in the University of the East case. Finally, disposing of the respondent’s charge of petitioner’s lack of legal capacity to sue, suffice it to say that this question can no longer be raised initially on appeal or certiorari. It is quite belated for the private respondent to question the personality of the petitioner after it had dealt with it as a party in the proceedings below. Furthermore, it was not disputed that the petitioner is a duly registered labor organization and as such has the legal capacity to sue and be sued. Registration grants it the rights of a legitimate labor organization and recognition by the respondent University is not necessary for it to institute this action in behalf of its members to protect their interests and obtain relief from grievances. The issues raised by the petitioner do not involve pure money claims but are more intricately intertwined with conditions of employment. WHEREFORE the petition for certiorari is hereby GRANTED. The private respondent is ordered to pay its regular fulltime teachers/employees emergency cost of living allowances for the semestral break from November 7 to December 5, 1981 and the undistributed balance of the sixty (60%) percent incremental proceeds from tuition increases for the same schoolyear as outlined above. The respondent Commission is sustained insofar as it DENIED the payment of salaries for the suspended extra loads on September 21, 1981. LUZON STEVEDORING CO. INC., VS. LUZON MARINE DEPARTMENT UNION G. R NO. L-9265 APRIL 29, 1957 Facts: Respondents filed a petition with the Court of Industrial Relations containing the full recognition of the right of collective bargaining close stop and check off. Also, that the worked performed in excess of (8) hours bw paid on overtime pay of 50% the regular rate of pay, and that work performed on Sunday and Legal holidays be paid double the regular rate pay. In one of the hearing of the case, the court ruled that the employees entitled to receive overtime pay for work rendered in excess of 8 hours on ordinary day including Sunday and Legal Holidays. Herein, petitioner sought for the reconsideration of the decision only in so far as it interpreted that the period during which seaman is board a tugboat shall be considered as “working time” for purpose of the 8 hours Labor Law. However, it was denied. Issue: Whether or not the definition for “hours work”, as presently applied to dry land laborers, equally applicable to seaman. Held:

The court ruled that there is no need to set for seaman a criterion different from that applied to laborers on land, that the only thing to be done is to determine the meaning and scope of the “working place”. A labourer, need not leave the premises of the factory shop or boat in order that his period of rest shall be counted, it being enough that he “cease to be work” may rest completely and leave or may leave at his will the spot where he actually stays while working. CAGAMPAN, ET. AL. VS. NLRC G.R. NOS. 85122-24 MARCH 24, 1991 PARAS, J. Facts: On April 17 and 18,1985, petitioners, all seamen, entered into separate contracts of employment with the Golden Light Ocean Transport, Ltd., through its local agency, private respondent ACE MARITIME AGENCIES, INC. Thereafter, petitioners collectively and/or individually filed complaints for non-payment of overtime pay, vacation pay and terminal pay against private respondent. In addition, they claimed that they were made to sign their contracts in blank. Likewise, petitioners averred that although they agreed to render services on board the vessel Rio Colorado managed by Golden Light Ocean Transport, Ltd., the vessel they actually boarded was MV "SOIC I" managed by Columbus Navigation. Two (2) petitioners, Jorge de Castro and Juanito de Jesus, charged that although they were employed as ordinary seamen (OS), they actually performed the work and duties of Able Seamen (AB). Private respondent was furnished with copies of petitioners' complaints and summons, but it failed to file its answer within the reglementary period. Thus, on January 12, 1987, an Order was issued declaring that private respondent has waived its right to present evidence in its behalf and that the cases are submitted for decision the Philippine Overseas Employment Administration (POEA) rendered a Decision dismissing petitioners' claim for terminal pay but granted their prayer for leave pay and overtime pay. Issue: Whether Cagampan even without sufficient evidence of actual rendition of overtime work, would automatically be entitled to overtime pay. Held: No. The NLRC ruling on the disallowance of overtime pay is ably supported by the fact that petitioners never produced any proof of actual performance of overtime work. The contract provision means that the fixed overtime pay of 30% would be the basis for computing the overtime pay if and when overtime work would be rendered. Simply, stated, the rendition of overtime work and the submission of sufficient proof that said work was actually performed are conditions to be satisfied before a seaman could be entitled to overtime pay which should be computed on the basis of 30% of the basic monthly salary. In short, the

contract provision guarantees the right to overtime pay but the entitlement to such benefit must first be established. Realistically speaking, a seaman, by the very nature of his job, stays on board a ship or vessel beyond the regular eight-hour work schedule. For the employer to give him overtime pay for the extra hours when he might be sleeping or attending to his personal chores or even just lulling away his time would be extremely unfair and unreasonable. NATIONAL DEVELOPMENT COMPANY VS. CIR G.R. NO. L-15422 NOVERNBER 30, 1962 REGALA, J. FACTS: At the National Development Co., a government-owned and controlled corporation, there were four shifts of work. One shift was from 8 a.m. to 4 p.m., while the three other shifts were from 6 a.m. to 2 p.m; then from 2 p.m. to 10 p.m. and, finally, from 10 p.m. to 6 a.m. In each shift, there was a one-hour mealtime period, to wit: From (1) 11 a.m. to 12 noon for those working between 6 a.m. and 2 p.m. and from (2) 7 p.m. to 8 p.m. for those working between 2 p.m. and 10 p.m. The records disclose that although there was a one-hour mealtime, petitioner nevertheless credited the workers with eight hours of work for each shift and paid them for the same number of hours. However, since 1953, whenever workers in one shift were required to continue working until the next shift, petitioner instead of crediting them with eight hours of overtime work, has been paying them for six hours only, petitioner that the two hours corresponding to the mealtime periods should not be included in computing compensation. ISSUE: Whether or not the mealtime breaks should be considered working time RULING: The CIR correctly concluded that work in petitioner company was continuous and therefore the mealtime breaks should be counted as working time for purposes of overtime compensation. Petitioner gives an eight-hour credit to its employees who work a single shift say from 6 a.m. to 2 p.m. Why cannot it credit them sixteen hours should they work in two shifts? There is another reason why this appeal should dismissed and that is that there is no decision by the CIR en bancfrom which petitioner can appeal to this Court. As already indicated above, the records show that petitioner's motion for reconsideration of the order of March 19, 1959 was dismissed by the CIR en banc because of petitioner's failure to serve a copy of the same on the union. SIME DARBY PILIPINAS INC. VS NLRC G.R. NO. 119205

APRIL 15, 1998 BELLOSILLO, J . Facts: Sime Darby Pilipinas, Inc., petitioner, is engaged in the manufacture of automotive tires, tubes and other rubber products. Sime Darby Salaried Employees Association (ALU-TUCP), private respondent, is an association of monthly salaried employees of petitioner at its Marikina factory. Prior to the present controversy, all company factory workers in Marikina including members of private respondent union worked from 7:45 a.m. to 3:45 p.m. with a 30 minute paid “on call” lunch break. On 14 August 1992 petitioner issued a memorandum to all factory-based employees advising all its monthly salaried employees in its Marikina Tire Plant, except those in the Warehouse and Quality Assurance Department working on shifts, a change in work schedule effective 14 September 1992 thus – 7:45 A.M. – 4:45 P.M. (Mon to Fri) 7:45 A.M. – 11:45 P.M. (Sat). Coffee break time will be ten minutes only anytime between: 9:30 A.M. –10:30 A.M. and 2:30 P.M. –3:30 P.M. Lunch break will be between: 12:00 NN –1:00 P.M. (Mon to Fri). Excluded from the above schedule are the Warehouse and QA employees who are on shifting. Their work and break time schedules will be maintained as it is now. Since private respondent felt affected adversely by the change in the work schedule and discontinuance of the 30-minute paid “on call” lunch break, it filed on behalf of its members a complaint with the Labor Arbiter for unfair labor practice, discrimination and evasion of liability pursuant to the resolution of this Court the Labor Arbiter dismissed the complaint on the ground that the change in the work schedule and the elimination of the 30-minute paid lunch break of the factory workers constituted a valid exercise of management prerogative and that the new work schedule, break time and one-hour lunch break did not have the effect of diminishing the benefits granted to factory workers as the working time did not exceed eight (8) hours. Issue: Whether or not the act of management in revising the work schedule of its employees and discarding their paid lunch break constitutive of unfair labor practice? Ruling: The Court ruled that the revision of work schedule is a management prerogative and does not amount to unfair labor practice in discarding the paid lunch break. The right to fix the work schedules of the employees rests principally on their employer. In the instant case petitioner, as the employer, cites as reason for the adjustment the efficient conduct of its business operations and its improved production. It rationalizes that while the old work schedule included a 30-minute paid lunch break, the employees could be called upon to do jobs during that period as they were “on call.” Even if denominated as lunch break, this period could very well be

considered as working time because the factory employees were required to work if necessary and were paid accordingly for working. With the new work schedule, the employees are now given a one-hour lunch break without any interruption from their employer. For a full one-hour undisturbed lunch break, the employees can freely and effectively use this hour not only for eating but also for their rest and comfort which are conducive to more efficiency and better performance in their work. Since the employees are no longer required to work during this one-hour lunch break, there is no more need for them to be compensated for this period. The Court agrees with the Labor Arbiter that the new work schedule fully complies with the daily work period of eight (8) hours without violating the Labor Code. Besides, the new schedule applies to all employees in the factory similarly situated whether they are union members or not. MERCURY DRUG CO., INC., VS. DAYAO G.R. NO. L-30452 SEPTEMBER 30, 1982 GUTIERREZ, JR., J. FACTS This is a verified petition dated March 17, 1964 which was subsequently amended on July 31, 1964 filed by Nardo Dayao and 70 others against Mercury Drug Co., Inc.,and/or Mariano Que, President & General Manager, and Mercury Drug Co., Inc.2.Employees Association praying, with respect to respondent corporation and its president and general manager: 1) payment of their unpaid back wages for work done on Sundays and legal holidays plus 25 % additional compensation from date of their employment up to June 30, 1962; 2) payment of extra compensation on work done at night; 3) reinstatement of Januario Referente and Oscar Echalar to their former positions with back salaries; and, as against the respondent union, for its disestablishment and the refund of the money it had collected from petitioners. The CIR sustained the claim of the petitioners for payment of back wages corresponding to the first four hours work rendered on every other Sunday and first four hours on legal holidays should be denied for lack of merit. The motion for reconsideration was denied. Thus, the instant petition contending that private respondents' claims for 25%Sunday and Legal Holiday premiums are not supported by substantial evidence, thus infringing upon the cardinal rights of the petitioner, and that assuming it is, such premiums are already included in the salary of private respondents. ISSUE Whether or not private respondents are entitled to the 25% Sunday and Legal Holiday premiums. Ruling

The contention is without merit. While an employer may compel his employees to perform service on such days, the law nevertheless imposes upon him the obligation to pay his employees at least 25% additional of their basic or regular salaries. Under Section 4 of C. A. No. 444, no person, firm or corporation, business establishment or place of center of labor shall compel an employee or laborer to work during Sundays and legal holidays unless he is paid an additional sum of at least twenty-five per centum of his regular remuneration :Provided, However, That this prohibition shall not apply to public utilities performing some public service such as supplying gas, electricity, power, water, or providing means of transportation or communication. Although a service enterprise, respondent company's employees are within the coverage of C. A. No. 444, as amended known as the Eight Hour Labor Law, for they do not fall within the category or class of employees or laborers excluded from its provisions. In not giving weight to the evidence of the petitioner company, the respondent court sustained the private respondents' evidence to the effect that their 25%additional compensation for work done on Sundays and Legal Holidays were not included in their respective monthly salaries. The private respondents presented evidence through the testimonies of Nardo, Dayao, Ernesto Talampas, and Josias Federico who are themselves among the employees who filed the case for unfair labor practice in the respondent court and are private respondents herein. The petitioner- company's contention that the respondent court's conclusion on the issue of the 25% additional compensation for work done on Sundays and legal holidays during the first four hours that the private respondents had to work under their respective contracts of employment was not supported by substantial evidence is, therefore, unfounded BISIG NG MANGGAGAWA NG PHILIPPINE REFINING CO., INC., VS. PHILIPPINE REFINING CO., INC., G.R. NO. L-27761 SEPTEMBER 30, 1981 FACTS: This is an appeal from the decision of the Court of First Instance of Manila dated December 8, 1966,inCivil Case No. 65082, holding that Christmas bonus and other fringe bene fits are excluded in thecomputation of the overtime pay of the members of the appellant union under Section 6, Article VI of the1965 collective bargaining agreement which reads as follows:Overtime pay at the rate of regular base pay plus 50% thereof shag be paid for allwork performed in excess of eight hours on ordinary days within the work week(that is to say, Monday to Friday).On April 15,1966, the Bisig ng Manggagawa ng Philippine Refining Company, Inc., as the representativeunion of the rank and file employees of the Philippine Refining Co., Inc., filed with the Court of FirstInstance of Manila a petition for declaratory relief praying, among others —That a declaratory judgment be rendered declaring and adjudicating the rights andduties of petitioner and respondent under the above quoted provision of their Collective 13 - agreements and further declaring

that the Christmas bonus of onemonth or thirty days pay and other de determinable benefits should be included for the purpose of computation of the overtime pay spread throughout the twelvemonths period of each year from August, 1963 up to the present and subsequentlyhereafter; and that respondent be therefore directed to pay such differential in theovertime pay of all the employees of the herein respondent ;Petitioner union contended that the respondent company was under obligation to include the employees'Christmas bonus and other fringe benefits in the computation of their overtime pay by virtue of the ruling of this Court in the case of NAWASA vs. NAWASA Consolidated Unions, et all G.R. No. L-18938, August 31,1964, 11 SCRA 766.On May 3, 1966, the Philippine Refining Co.. Inc. filed its answer to the petition alleging that never did theparties intend, in the 1965 CBA and in prior agreements, to include the employees' Christmas bonus andother fringe benefits in the computation of the overtime pay and that the company precisely agreed to arate of 50%, which is much higher than the 25% required by the Eight-Hour Labor Law (Commonwealth Act No. 444, as amended), on the condition that in computing the overtime pay only the "regular base pay"would be considered. After the requisite pre-trial was held, the CFI of Manila issued an order limiting the issues to the proper interpretation of the above quoted provision of the 1965 CBA and to the applicability to the case of theNAWASA ruling and requiring the parties to submit evidence as to the circumstances under which thequestioned provision had been included in the agreement of 1965. After presentations of respective witnesses, the CFI of Manila rendered a decision on December 8, 1966,.Said court held that while the NAWASA ruling concerning the meaning of the phrase "regular pay" of theEightHour Labor Law could be applied to employees of private corporations like the Philippine RefiningCompany, the same was, nevertheless, inapplicable to the case at bar which involved the interpretation of the phrase "regular base pay which was different from "regular pay". It declared that "regular base pay"referred only to the basic or monthly pay exclusive of Christmas bonus and o ther fringe benefits.Furthermore, the validity of the provision of the 1965 collective bargaining agreement concerning thecomputation of the employees' overtime pay on the basis of their "regular base pay" was upheld by thecourt for the reason that the same was even higher than the overtime pay prescribed by law. PHILIPPINE NATIONAL BANK VS. PHILIPPINE NATIONAL BANK EMPLOYEES ASSOCIATION (PEMA) G.R. NO. L-30279 JULY 30, 1982 BARREDO, J. FACTS: PNB and PNB Employees Association (PEMA) had a dispute regarding the proper computation of overtime pay. PEMA wanted the cost of living allowance (granted in 1958) and longevity pay (granted in 1961) to be included in the computation. PNB disagreed and the 2 parties later went before the CIR to

resolve the dispute. CIR decided in favor of PEMA and held that PNB should compute the overtime pay of its employees on the basis of the sum total of the employee’s basic salary or wage plus cost of living allowance and longevity pay. The CIR relied on the ruling in NAWASA v NAWASA Consolidated Unions, which held that “for purposes of computing overtime compensation, regular wage includes all payments which the parties have agreed shall be received during the work week, including differentiated payments for working at undesirable times, such as at night and the board and lodging customarily furnished the employee.” This prompted PNB to appeal, hence this case. ISSUE: WON the cost of living allowance and longevity pay should be included in the computation of overtime pay as held by the CIR HELD: NO, Overtime pay is for extra effort beyond that contemplated in the employment contract; additional pay given for any other purpose cannot be included in the basis for the computation of overtime pay. Absent a specific provision in the CBA, the bases for the computation of overtime pay are 2 computations, namely: WON the additional pay is for extra work done or service rendered WON the same is intended to be permanent and regular, not contingent nor temporary as a given only to remedy a situation which can change any time. Longevity pay cannot be included in the computation of overtime pay for the very simple reason that the contrary is expressly stipulated in the CBA, which constitutes the law between the parties. As regards cost of living allowance, there is nothing in Commonwealth Act 444 [or “the 8-hour Labor Law,” now Art. 87 Labor Code] that could justify PEMA’s posture that it should be added to the regular wage in computing overtime pay. C.A. 444 prescribes that overtime work shall be paid “at the same rate as their regular wages or salary, plus at least 25% additional.” The law did not define what is a regular wage or salary. What the law emphasized is that in addition to “regular wage,” there must be paid an additional 25% of that “regular wage” to constitute overtime rate of pay. Parties were thus allowed to agree on what shall be mutually considered regular pay from or upon which a 25% premium shall be based and added to makeup overtime compensation. No rule of universal application to other cases may be justifiably extracted from the NAWASA case. CIR relies on the part of the NAWASA decision where the SC cited American decisions whose legislation on overtime is at variance with the law in this jurisdiction. The US legislation considers work in excess of forty hours a week as overtime; whereas, what is generally considered overtime in the Philippines is work in excess of the regular 8 hours a day. It is understandably material to refer to precedents in the US for purposes of computing weekly wages under a 40-hour week rule, since the particular issue involved in NAWASA is the

conversion of prior weekly regular earnings into daily rates without allowing diminution or addition. To apply the NAWASA computation would require a different formula for each and every employee. It would require reference to and continued use of individual earnings in the past, thus multiplying the administrative difficulties of the Company. It would be cumbersome and tedious a process to compute overtime pay and this may again cause delays in payments, which in turn could lead to serious disputes. To apply this mode of computation would retard and stifle the growth of unions themselves as Companies would be irresistibly drawn into denying, new and additional fringe benefits, if not those already existing, for fear of bloating their overhead expenses through overtime which, by reason of being unfixed, becomes instead a veritable source of irritant in labor relations. **Overtime Pay Rationale Why is a laborer or employee who works beyond the regular hours of work entitled to extra compensation called, in this enlightened time, overtime pay? Verily, there can be no other reason than that he is made to work longer than what is commensurate with his agreed compensation for the statutorily fixed or voluntarily agreed hours of labor he is supposed to do. When he thus spends additional time to his work, the effect upon him is multi- faceted; he puts in more effort, physical and/or mental; he is delayed in going home to his family to enjoy the comforts thereof; he might have no time for relaxation, amusement or sports; he might miss important pre-arranged engagements; etc. It is thus the additional work, labor or service employed and the adverse effects just mentioned of his longer stay in his place of work that justify and are the real reasons for the extra compensation that is called overtime pay. **Overtime Pay Definition The additional pay for service or work rendered or performed in excess of 8 hours a day by employees or laborers in employment covered by the 8 hour Labor Law [C.A. 444, now Art. 87 Labor Code] and not exempt from its requirements. It is computed by multiplying the overtime hourly rate by the number of hours worked in excess of eight. Disposition decision appealed from is REVERSED NATIONAL WATERWORKS & SEWERAGE AUTHORITY VS. NWSA CONSOLIDATED UNION, JESUS CENTENO, ET AL., G.R. NO. L-26894-96 FEBRUARY 28, 1969 FERNANDO, J. Facts: Domingo, discharged the function of a supervisor. Likewise, coordinating engineer, Zurban since September 13, 1955 until the date of his retirement was corporate legal counsel, and Fabregas, was the chief of the administrative division during the period of his claim were concerned. They were required to work

overtime but was not paid overtime pay, the peititioer contending that the fall within the category “managerial employee” which is exempted from being paid of overtime pay. The Court of Industrial Relations decided the case in their favour. Issue: Whether the private respondents fall within the category of “managerial employees.” Held: No. "The most obvious distinction of a 'managerial employee' is his participation in formulating company policies. Another is his power to hire or fire employees, and under Rep. Act No. 2377, his exemption from the rigid observance of regular office hours. The Court fails to find any indication that their primary duties bear any direct relation with the [Nawasa] management or that they help formulate its policies. Neither is there any indication that the three movants have the power to hire or fire employees of the [Nawasa]. On the contrary, the very exhibits presented by the [Nawasa] ... show that the power to hire and fire, and to formulate policies exclusively belong to the Board of Directors and the General Manager. What is more, all the three movants were required to observe official time, so much so that any undertime or absence incurred by them were deducted from their accrued vacation or sick leave. They had to accomplish their daily time records in Civil Service Form No. 48, wherein they had to record their time of arrivals and departures, hence lack the freedom to come and go to their offices, or move about at their own pleasure, which is the unmistakable mark of a 'managerial employee'." 6 It was the conclusion of respondent Court then: "For the purpose of Rep. Act No. 2377, therefore, the movants do not fall within the category of 'managerial employees', hence are not barred from claiming overtime." 7 DE LEON V PAMPANGA SUGAR DEVELOPMENT CO. 20 SCRA 628 SEPTEMBER 30, 1969 CASTRO, J. Facts: The respondent Pampanga Sugar Development Company (PASUDECO) operates a sugar central at San Fernando, Pampanga. The petitioners, 21 all told, were its security guards required to work eight hours a day, seven days a week. On November 28, 1961 the petitioners filed with the CIR a complaint seeking payment to them of premium or differential pay in the total amount P49,581.79, plus attorney's fees of P3,000 and costs of suit. Upon the finding that the "petitioners were paid their monthly salaries plus 25% additional compensation for work on Sundays and Holidays as provided for by law and that work on said days is one of the terms and conditions of their employment as security guards." The Court of Industrial Relations dismissed the case. The petitioners' claim, in essence, is that under the authority of section 4 of Commonwealth Act 444 as amended (Eight-Hour Labor Law), for a Sunday or legal holiday work of not more than eight hours, each of them is entitled to his monthly salary and his premium or differential compensation.

Issue: Whether or not the petitioners are entitled to the 25% premium pay who worked on Sunday or legal holiday?? Held: Yes, The import of the law and the decision in Manalo is that for work on Sundays and legal holidays, the employer must pay the employee: (1) his regular remuneration, or 100%; and (2) an additional sum of at least 25% of the regular remuneration, which is called the "premium pay." In other words, the pay for Sundays and legal holidays is 125% of the pay for ordinary days, but only the excess of 25% is premium pay. With respect to employees paid on a monthly basis, the first 100% (of the 125%), corresponding to the regular remuneration, may or may not be included in the monthly salary. If it is, then the employee is entitled to collect only the premium of 25%. If it is not, then the employee has a right to receive the entire 125%. The court en banc affirmed the decision of Court of Industrial relations, there is a finding that the "petitioners were paid their monthly salaries plus 25% additional compensation for work on Sundays and holidays." JOSE RIZAL COLLEGE VS. NLRC AND NATOW G.R. NO. L-65482 DECEMBER 1, 1987 FACTS: Petitioner is a non-stock, non-profit educational institution duly organized and existing under the laws of the Philippines. It has three groups of employees categorized as follows: (a) personnel on monthly basis, who receive their monthly salary uniformly throughout the year, irrespective of the actual number of working days in a month without deduction for holidays; (b) personnel on daily basis who are paid on actual days worked and they receive unworked holiday pay and (c) collegiate faculty who are paid on the basis of student contract hour. Before the start of the semester they sign contracts with the college undertaking to meet their classes as per schedule. Unable to receive their corresponding holiday pay, as claimed, from 1975 to 1977. ISSUE: The sole issue in this case is whether or not the school faculty who according to their contracts are paid per lecture hour and are entitled to unworked holiday pay. HELD: Petitioner maintains the position among others, that it is not covered by Book V of the Labor Code on Labor Relations considering that it is a non- profit institution and that its hourly paid faculty members are paid on a "contract" basis because they are required to hold classes for a particular number of hours. if a regular week day is declared a holiday, the school calendar is extended to compensate for that day. Thus petitioner argues that the advent of any of the legal holidays within the semester will not affect the faculty's salary because this day is not included in their schedule while the calendar is extended to compensate for

special holidays. Regular holidays specified as such by law are known to both school and faculty members as no class days;" certainly the latter do not expect payment for said unworked days, and this was clearly in their minds when they entered into the teaching contracts. On the other hand, both the law and the Implementing Rules governing holiday pay are silent as to payment on Special Public Holidays. Declared purpose of the holiday pay which is the prevention of diminution of the monthly income of the employees on account of work interruptions is defeated when a regular class day is cancelled on account of a special public holiday and class hours are held on another working day to make up for time lost in the school calendar. PREMISES CONSIDERED, the decision of respondent National Labor Relations Commission is hereby set aside, and a new one is hereby RENDERED: (a) exempting petitioner from paying hourly paid faculty members their pay for regular holidays, whether the same be during the regular semesters of the school year or during semestral, Christmas, or Holy Week vacations; (b) but ordering petitioner to pay said faculty members their regular hourly rate on days declared as special holidays or for some reason classes are called off or shortened for the hours they are supposed to have taught, whether extensions of class days be ordered or not; in case of extensions said faculty members shall likewise be paid their hourly rates should they teach during said extensions.

SAN MIGUEL CORPORATION V. COURT OF APPEALS ET AL G.R. NO. 146775 JANUARY 30, 2002 KAPUNAN, J. Facts: The Department of Labor and Employment conducted a routine inspection in San Miguel Corporation, Iligan City and it was discovered that there was underpayment by SMC of regular Muslim holiday pay to its employees. DOLE sent a copy of inspection result to SMC which the latter contested the findings. SMC failed to submit proof and hence the Director of DOLE of Iligan District Office issued a compliance order to pay both its Muslim and non-Muslim employees the Muslim Holidays. SMC appealed to DOLE main office but dismissed for having been filed late but later on reconsidered because it is within reglementary period but still dismissed for lack of merit. Hence, this present petition for certiorari. Issue:

Whether or not non-Muslim employees working in Muslim areas is entitled to Muslim Holiday Pay. Held: The Supreme Court dismissed the petition and ordered the petitioner to pay its non-Muslim employees. The basis for this decision were Articles 169 and 170 of P.D. No. 1083 “Code of Muslim Personal Laws” which listed all official Muslim holidays and provincies and cities where officially observed. In this case, SMC is located in Iligan which is covered in the those provisions. Also Article 169 and 170 of PD No. 1083 should be read in conjunction with Article 94 of Labor Code which provides for the right of every worker to be paid of holiday pay. Petitioner asserts Art.3(3) of PD No. 1083 provides that it shall be applicable only to Muslims. However, the Court said that said article declares that nothing herein shall be construed to operate to the prejudice of a non-Muslim. There should be no distinction between Muslims and non-Muslims as regards payment of benefits for Muslim holidays. It was said also that the The Court of Appeals did not err in sustaining Undersecretary Español who stated: “Assuming arguendo that the respondent’s position is correct, then by the same token, Muslims throughout the Philippines are also not entitled to holiday pays on Christian holidays declared by law as regular holidays. We must remind the respondent-appellant that wages and other emoluments granted by law to the working man are determined on the basis of the criteria laid down by laws and certainly not on the basis of the worker’s faith or religion.”

INSULAR BANK OF ASIA AND AMERICA EMPLOYEE’S UNION VS. INCIONG G.R. NO. L – 52415 OCTOBER 23, 1984 FACTS: The Union filed a complaint against the bank for the payment of holiday pay before the then Department of Labor, Regional Office IV in Manila. Conciliation having failed on June 20, 1975, and upon the request of both parties, the case was certified for arbitration on July 7, 1975. On August 25, 1975, Labor Arbiter Ricarte T. Soriano rendered decision granting petitioner's complaint for payment of holiday pay. Respondent bank did not appeal from the said decision. Instead, it complied with the order of the Labor Arbiter by paying their holiday pay up to and including January 1976. P.D. 850 was promulgated amending the provisions of the Labor Code on the right to holiday pay. Accordingly by authority of Article 5 of the Labor Code, the Department of Labor (now Ministry of Labor) promulgated the rules and regulations for the implementation of holidays with pay. The section reads:

“Status of employees paid by the month. – Employees who are uniformly paid by the month, irrespective of the number of working days therein, with a salary of not less than the statutory or established minimum wage shall be presumed to be paid for all days in the month whether worked or not.” Policy Instruction 9 was issued by the then Secretary of Labor on April 23, 1976, interpreting the said rule. The bank, by reason of the ruling laid down by the rule implementing Article 94 of the Labor Code and by Policy Instruction 9, stopped the payment of holiday pay to an its employees. On August 30, 1976, the Union filed a motion for a writ of execution to enforce the arbiter's decision dated August 1975, which the bank opposed. On October 18, 1976, the Labor Arbiter, instead of issuing a writ of execution, issued an order enjoining the bank to continue paying its employees their regular holiday pay. On November 17, 1976, the bank appealed from the order of the Labor Arbiter to the NLRC. On 20 June 1978, the NLRC promulgated its resolution dismissing the bank’s appeal, and ordering the issuance of the proper writ of execution. On February 21, - 1979, the bank filed with the Office of the Minister of Lab or a motion for reconsideration/appeal with urgent prayer to stay execution. On August 13, 1979 the NLRC issued an order directing the Chief of Research and Information of the Commission to compute the holiday pay of the IBAA employees from April 1976 to the present in accordance with the Labor Arbiter dated August 25, 1975. On November 10, 1979, the Office of the Minister of Labor, through Deputy Minister Amado Inciong, issued an order setting aside the resolution of the NLRC dated June 20, 1978, and dismissing the case for lack of merit. Issue: Whether or not the monthly paid employees are excluded from the benefits of holiday pay. Held: No. The provisions of the Labor Code on the entitlement to the benefits of holiday pay are clear and explicit – it provides for both the coverage of and exclusion from the benefits. In Policy Instruction No. 9, the then Secretary of Labor went as far as to categorically state that the benefit is principally intended for daily paid employees, when the law clearly states that every worker shall be paid their regular holiday pay Section 2, Rule IV, Book III of the implementing rules and Policy Instruction No. 9 issued by the then Secretary of Labor are null and void since in the guise of clarifying the Labor Code’s provisions on holiday pay, they in effect amended them by enlarging the scope of their exclusion.

From Article 92 of the Labor Code, as amended by Presidential Decree 850, and Article 32 of the same Code, it is clear that monthly paid employees are not excluded from the benefits of holiday pay. However, the implementing rules on holiday pay promulgated by the then Secretary of Labor excludes monthly paid employees from the said benefits by inserting, under 17 Rule IV, of the implementing rules, Section 2, which provides that: “employees who are uniformly paid by the month, irrespective of the number of working days therein, with a salary of not less than the statutory or established minimum wage

shall be presumed to be paid for all days in the month whether worked or not." Even if contemporaneous construction placed upon a statute by executive officers whose duty is to enforce it is given great weight by the courts, still if such construction is so erroneous, the same must be declared as null and void. So long, as the regulations relate solely to carrying into effect the provisions of the law, they are valid. Where an administrative order betrays inconsistency or repugnancy to the provisions of the Act, the mandate of the Act must prevail and must be followed. A rule is binding on the Courts so long as the procedure fixed for its promulgation is followed and its scope is within the statutory authority granted by the legislature, even if the courts are not in agreement with the policy stated therein or its innate wisdom. Further, administrative interpretation of the law is at best merely advisory, for it is the courts that finally determine what the law means. THE CHARTERED BANK EMPLOYEES ASSOCIATION vs. HON. BLAS F. OPLE, and THE CHARTERED BANK, G.R. No. L-44717 August 28, 1985

FACTS: On May 20, 1975, petitioner instituted a complaint with the Ministry of Labor and Employment (MOLE) against private respondent Chartered Bank, for the payment of ten (10) unworked legal holidays, as well as for premium and overtime differentials for worked legal holidays from November 1, 1974. Both the arbitrator and the National Labor Relations Commission (NLRC) ruled in favor of the petitioners ordering the respondent bank to pay its monthly paid employees, holiday pay for the ten (10) legal holidays effective November 1, 1974 and to pay premium or overtime pay differentials to all employees who rendered work during said legal holidays. On appeal, the Minister of Labor set aside the decision of the NLRC and dismissed the petitioner's claim for lack of merit basing its decision on Section 2, Rule IV, Book Ill of the Integrated Rules and Policy Instruction No. 9. Petitioners contends that the respondent Minister of Labor’s promulgation of Section 2, Rule IV, Book III of the Integrated Rules and Policy Instruction No. 9 as guidelines for the interpretation of Articles 82 and 94 of the Labor Code and in applying said guidelines to this case constitutes a grave abuse of his discretion of his authority to promulgate rules and regulations to implement construe and clarify the Labor Code On the other hand, the private respondent contends that the questioned guidelines did not deprive the petitioner's members of the benefits of holiday pay but merely classified those monthly paid employees whose monthly salary already includes holiday pay and those whose do not, and that the guidelines did not deprive the employees of holiday pay. Issue: Whether or not the monthly salaries of the petitioner's members already include holiday pay Held: NO. The Court held that the issue in the case at bar, was the same issue raised and resolved in the case of Insular Bank of Asia and America Employees' Union (IBAAEU) v. Inciong (132 SCRA 663), which the Court ruled that Section 2, Rule IV, Book III of the

Integrated Rules and Policy Instruction No. 9, are contrary to the provisions of the Labor Code and, therefore, invalid. Since the private respondent premises its action on the invalidated rule and policy instruction, it is clear that the employees belonging to the petitioner association are entitled to the payment of ten (10) legal holidays under Articles 82 and 94 of the Labor Code, aside from their monthly salary. They are not among those excluded by law from the benefits of such holiday pay.

CEZAR ODANGO VS. NLRC G.R. NO. 147420 JUNE 10, 2004 FACTS: Petitioners are monthly-paid employees of ANTECO whose workdays are from Monday to Friday and half of Saturday. After a routine inspection, the Regional Branch of the Department of Labor and Employment ("DOLE") found ANTECO liable for underpayment of the monthly salaries of its employees. On 10 September 1989, the DOLE directed ANTECO to pay its employees wage differentials amounting to P1,427,412.75. ANTECO failed to pay. Thus, on various dates in 1995, thirty-three (33) monthly-paid employees filed complaints with the NLRC Sub-Regional Branch VI, Iloilo City, praying for payment of wage differentials, damages and attorney’s fees. Labor Arbiter Rodolfo G. Lagoc ("Labor Arbiter") heard the consolidated complaints. On 29 November 1996, the Labor Arbiter rendered a Decision in favor of petitioners granting them wage differentials amounting to P1,017,507.73 and attorney’s fees of 10%. Florentino Tongson, whose case the Labor Arbiter dismissed, was the sole exception. ANTECO appealed the Decision to the NLRC on 24 December 1996. On 27 November 1997, the NLRC reversed the Labor Arbiter’s Decision. The NLRC denied petitioners’ motion for reconsideration in its Resolution dated 30 April 1998. Petitioners then elevated the case to this Court through a petition for certiorari, which the Court dismissed for petitioners’ failure to comply with Section 11, Rule 13 of the Rules of Court. On petitioners’ motion for reconsideration, the Court on 13 January 1999 set aside the dismissal. Following the doctrine in St. Martin Funeral Home v. NLRC,4 the Court referred the case to the Court of Appeals. On 27 September 2000, the Court of Appeals issued a Resolution dismissing the petition for failure to comply with Section 3, Rule 46 of the Rules of Court. The Court of Appeals explained that petitioners failed to allege the specific instances where the NLRC abused its discretion. The appellate court denied petitioners’ motion for reconsideration on 7 February 2001. ISSUES: Whether or not the petitioners are entitled to their money claims.

HELD: No. The Court rules that the petitioners are not entitled to their money claims. Petitioner claim based on Section 2, Rule IV, Book III of the Implementing Rules and Policy Instructions No. 9 issued by the Secretary (then Minister) of Labor which the court in its ruling on Insular Bank of Asia v. Inciong, declared the said rule as null and void since in the guise of clarifying the Labor Code’s provisions on holiday pay, they in effect amended them by enlarging the scope of their exclusion. And that even assuming that Section 2, Rule IV of Book III is valid, petitioners’ claim will still fail. The basic rule in this jurisdiction is "no work, no pay." The right to be paid for un-worked days is generally limited to the ten legal holidays in a year.15 Petitioners’ claim is based on a mistaken notion that Section 2, Rule IV of Book III gave rise to a right to be paid for un-worked days beyond the ten legal holidays. In effect, petitioners demand that ANTECO should pay them on Sundays, the un-worked half of Saturdays and other days that they do not work at all. Petitioners’ line of reasoning is not only a violation of the "no work, no pay" principle, it also gives rise to an invidious classification, a violation of the equal protection clause. Sustaining petitioners’ argument will make monthly-paid employees a privileged class who are paid even if they do not work. Thus, Section 2 cannot serve as basis of any right or claim. Absent any other legal basis, petitioners’ claim for wage differentials must fail. UNION OF FILIPRO EMPLOYEES V. BENIGNO VIVAR, JR. G.R. NO. 79255 JANUARY 20, 1992 Facts: On November 8, 1985, respondent Filipro, Inc. (now Nestle Philippines, Inc.) filed with the National Labor Relations Commission (NLRC) a petition for declaratory relief seeking a ruling on its rights and obligations respecting claims of its monthly paid employees for holiday pay in the light of the Court's decision in Chartered Bank Employees Association v Ople. Both Filipro and the Union of Filipino Employees (UFE) agreed to submit the case for voluntary arbitration and appointed respondent Benigno Vivar, Jr. as voluntary arbitrator. On January 2, 1980, Arbitrator Vivar rendered a decision directing Filipro to pay its monthly paid employees holiday pay pursuant to Article 94 of the Code, subject only to the exclusions and limitations specified in Article 82 and such other legal restrictions as are provided for in the Code. Filipro filed a motion for clarification seeking (1) the limitation of the award to three years,(2) the exclusion of salesmen, sales representatives, truck drivers, merchandisers and medical representatives from the award of the holiday pay,

and (3) deduction from the holiday pay award of overpayment for overtime, night differential, vacation and sick leave benefits due to the use of 251 divisor. Petitioner UFE answered that the award should be made effective from the date of effectivity of the Labor Code, that their sales personnel are not field personnel and are therefore entitled to holiday pay, and that the use of 251 as divisor is an established employee benefit which cannot be diminished. Both Nestle and UFE filed their respective motions for partial reconsideration. Respondent Arbitrator treated the two motions as appeals and forwarded the case to the NLRC which issued a resolution remanding the case to the respondent arbitrator on the ground that it has no jurisdiction to review decisions in voluntary arbitration cases pursuant to Article 263 of the Labor Code. However, in a letter the respondent arbitrator refused to take cognizance of the case reasoning that he had no more jurisdiction to continue as arbitrator because he had resigned from service. Issue: Whether or not Nestle's sales personnel are entitled to holiday pay. Ruling: Under Article 82, field personnel are not entitled to holiday pay. Said article defines field personnel as "non agricultural employees who regularly perform their duties away from the principal place of business or branch office of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty." The Court finds that the clause "whose time and performance is unsupervised by the employer" did not amplify but merely interpreted and expounded the clause "whose actual hours of work in the field cannot be determined with reasonable certainty." The former clause is still within the scope and purview of Article 82 which defines field personnel. Hence, in deciding whether or not an employee's actual working hours in the field can be determined with reasonable certainty, query must be made as to whether or not such employee's time and performance is constantly supervised by the employer. The respondent arbitrator's order to change the divisor from 251 to 261 days would result in a lower daily rate which is violative of the prohibition on nondiminution of benefits found in Article 100 of the Labor Code. To maintain the same daily rate if the divisor is adjusted to 261 days, then the dividend, which represents the employee's annual salary, should correspondingly be increased to incorporate the holiday pay. There is thus no merit in respondent Nestle's claim of overpayment of overtime and night differential pay and sick and vacation leave benefits, the computation of which are all based on the daily rate, since the daily rate is still the same before and after the grant of holiday pay. Respondent Nestle's invocation of solutio indebiti, or payment by mistake, due to its use of 251 days as divisor must fail in light of the Labor Code mandate that "all doubts in the implementation and interpretation of this Code, including its implementing rules and regulations, shall be resolved in favor of labor." (Article

4). Nevertheless, in order to fully settle the issues, the Court resolved to take up the matter of effectivity of the holiday pay award raised by Nestle. Applying the “operative fact” aforementioned doctrine to the case at bar, it is not far-fetched that Nestle, relying on the implicit validity of the implementing rule and policy instruction before this Court nullified them, and thinking that it was not obliged to give holiday pay benefits to its monthly paid employees, may have been moved to grant other concessions to its employees, especially in the collective bargaining agreement. This possibility is bolstered by the fact that respondent Nestle's employees are among the highest paid in the industry. With this consideration, it would be unfair to impose additional burdens on Nestle when the non-payment of the holiday benefits up to 1984 was not in any way attributed to Nestle's fault. The Court thereby resolves that the grant of holiday pay be effective, not from the date of promulgation of the Chartered Bank case nor from the date of effectivity of the Labor Code, but from the date of promulgation of the IBAA case.

WELLINGTON INVESTMENT AND MANUFACTURING CORPORATION VS. TRAJANO, ET AL. G.R. NO. 114698 JULY 3, 1995 NARVASA, CJ. FACTS: By virtue of the routine inspection conducted by a Labor Enforcement Officer, Wellington Flour Mills owned by the petitioner-company was found nonpayment of regular holidays falling on a Sunday for monthly-paid employees. Wellington argued that the monthly-paid employees already includes holiday pay for all regular holidays and there is no legal basis for the finding of alleged nonpayment of regular holidays falling on a Sunday. It further contends that it pays its monthly paid employees a fixed monthly compensation using the “314 factor” which undeniably covers and already includes payment for all the working days in a month as well as all the 10 un-worked regular holidays within a year. The Regional Director ordered the petitioner to pay the employees additional compensation corresponding to 4 extra working days. However, the petitioner argued that the company, using the “314 factor” already gave complete payment of all compensation due to its workers. Petitioner appealed and was acted on by the respondent Undersecretary. But still, Regional Director’s decision was affirmed. Hence, this petition.

ISSUE: Whether or not a monthly-paid employees, receiving a fixed monthly compensation, is entitled to an additional pay aside from his usual holiday pay whenever a regular holiday falls on a Sunday. HELD: Regional Director’s decision, affirmed by the Undersecretary, is nullified and set aside. Every worker should be paid his regular daily wage during regular holidays; except in retail and service establishments regularly employing less than 10 workers, even if the worker does not work on these regular holidays. The Wellington had been paying its employees a salary of not less than the statutory minimum wage and that the monthly salary, thus, paid was not less than the statutory minimum wage multiplied by 365 days divided by 12. Apparently the monthly salary was fixed by Wellington to provide for compensation for every working day of the year including holidays specified by law and excluding only Sundays. Wellington leaves no day unaccounted for, it is paying for all the days of a year with the exception only of 51 Sundays. JOSE RIZAL COLLEGE VS. NLRC G.R. NO. L-65482 DECEMBER 1, 1987 PARAS, J. FACTS Petitioner is a non-stock, non-profit educational institution duly organized and existing under the laws of the Philippines. It has three groups of employees categorized as follows: (a) personnel on monthly basis, who receive their monthly salary uniformly throughout the year, irrespective of the actual number of working days in a month without deduction for holidays; (b) personnel on daily basis who are paid on actual days worked and they receive unworked holiday pay and (c) collegiate faculty who are paid on the basis of student contract hour. Before the start of the semester they sign contracts with the college undertaking to meet their classes as per schedule. Unable to receive their corresponding holiday pay, as claimed, from 1975 to 1977, private respondent National Alliance of Teachers and Office Workers (NATOW) in behalf of the faculty and personnel of Jose Rizal College filed with the Ministry of Labor a complaint against the college for said alleged non-payment of holiday pay, docketed as Case No. R04-10-81-72. Due to the failure of the parties to settle their differences on conciliation, the case was certified for compulsory arbitration. The Labor Arbiter rendered a decision that the faculty who are paid per student compensation per student contract hour are not entitled to unworked regular holiday pay. On appeal, respondent National Labor Relations Commission in a decision promulgated on June 2, 1982, modified the decision appealed from, in the sense that teaching personnel paid by the hour are declared to be entitled to holiday pay. ISSUE

Whether or not the school faculty who according to their contracts are paid per lecture hour are entitled to unworked holiday pay. RULING Regular holidays specified as such by law are known to both school and faculty members as no class days;" certainly the latter do not expect payment for said unworked days, and this was clearly in their minds when they entered into the teaching contracts. On the other hand, both the law and the Implementing Rules governing holiday pay are silent as to payment on Special Public Holidays. It is readily apparent that the declared purpose of the holiday pay which is the prevention of diminution of the monthly income of the employees on account of work interruptions is defeated when a regular class day is cancelled on account of a special public holiday and class hours are held on another working day to make up for time lost in the school calendar. Otherwise stated, the faculty member, although forced to take a rest, does not earn what he should earn on that day. Be it noted that when a special public holiday is declared, the faculty member paid by the hour is deprived of expected income, and it does not matter that the school calendar is extended in view of the days or hours lost, for their income that could be earned from other sources is lost during the extended days. Similarly, when classes are called off or shortened on account of typhoons, floods, rallies, and the like, these faculty members must likewise be paid, whether or not extensions are ordered.

BALTAZAR VS SAN MIGUEL INC. G.R. NO. L-23076 FEBRUARY 27,1969 DIZON, J. FACTS: The petitioner is the salesman-in-charge of San Miguel Brewery, Inc. in Dagupan warehouse with a monthly pay of P240.00, P5.00 per diem and a commission of P0.75 per case sold. On October 9, 1956, 8 days after Baltazar was appointed as the salesman-in-charge, the regular employees in Dagupan warehousewent on strike because of unjust treatment. Baltazar was recalled to appellants Manila Office on the 13th of October, 1956 upon theorder of his superior and conduct an investigation. The investigationfound that the employees’ grievances were well founded. The next day, the strikers returned to their work voluntarily. On October 15, the petitioner was informed that he was not to return to Dagupan anymore but he still reported to work at the main office from October 16 to November 2, 1956 waiting for assignment. From November 3

to December 19 on the same year, he absented himself from work without consent from his superiors and without advising them or anybody else of the reason for his prolonged absence. He was dismissed from work because of petitioner’s unauthorized absence and if the company would consider its health, welfare and retirement plan requiring sick leave, still the petitioner did inexcusable actions since sick leave, to be considered authorized and excusable, must be certified to by the company physician and the appellant-company informed that Baltazar was dismissed effective November 30, 1956. Baltazar initiated a complaint which the trial court ruled that Baltazar’s dismissal was justified but, however, ordering San Miguel Brewery Inc. to pay Baltazar one month separation pay, plus the cash value of 6 months accumulated sick leave. Issue: Whether or not the petitioner is entitled to one month separation pay and the cash value of 6 months accumulated sick leave. Held: No, the petitioner is not entitled to one month separation pay and the cash value of 6 months accumulated sick leave. Under the Marcaida vs. Philippine Education Company 53 O.G. No. 23, RA 1052 makes reference to termination of employment, instead of dismissal, to exclude employees separated from the service for causes attributable to their own fault. It is limited in its operation, to cases of employment without definite period. When the employment is for a fixed duration, the employer may terminate it even before the expiration of a stipulated period, should there be a substantial breach of obligations by the employee; in which event the latter is not entitles to advance notice or separation pay. it would patently, be absurd to grant a right thereto to an employee guilty of the same breach of obligation, when the employment is without a definite period, as if he were entitled to greater protection than employees engaged for a fixed duration. In connection with the question of whether or not petitioner is entitled to the cash value of 6 months accumulated sick leave, it appears that while under the last paragraph of Article 5 of appellant’s Rules and Regulations of Health, Welfare and Retirement Plan, unused sick leave may be accumulated up to a maximum of 6 months, the same is not commutable or payable in cash upon the employees’ option. KWOK VS. PHILIPPINE CARPET MANUFACTURING CORPORATION G.R. NO. 149252 APRIL 28, 2005 CALLEJO, SR., J. FACTS: Petitioner filed a complaint against the respondent corporation for the recovery of accumulated vacation and sick leave credits before the NLRC. Petitioner clung to the verbal contract with Mr. Lim, the President of the respondent corporation and his father-in-law for his claims. Petitioner obtained favorable judgment. In their appeal, respondent averred that the position the petition held was not

entitled cash conversions of vacation and sick leave credits. The decision of the Labor Arbiter was reversed. The Court of Appeals affirmed the reversed decision. Issue: Whether the verbal contract in favor of petitioner is valid. Held: No. It is true that for a contract to be binding on the parties thereto, it need not be in writing unless the law requires that such contract be in some form in order that it may be valid or enforceable or that it be executed in a certain way, in which case that requirement is absolute and independent. (Art. 1356, NCC) But the court disbelieved petitioner’s testimony and gave credence and probative weight to the collective testimonies of the employees and officers of the respondent corporation, including Mr. Lim, whom the petitioner presented as a hostile witness. Even assuming that the petitioner was entitled of such benefits, there was no record to show the record of absences to arrive at the actual number of leave credits. There was no conformity of such agreement with the Board and if so, such claim was already barred by prescription under Article 291 of the Labor Code. SONGCO, ET AL. VS. NATIONAL LABOR RELATIONS COMMISSION G.R. NO. L-50999 MARCH 23, 1990 MEDIALDEA, J. FACTS: Zuelig filed an application for clearance to terminate the services of Songco, and others, on the ground of retrenchment due to financial losses. During the hearing, the parties agreed that the sole issue to be resolved was the basis of the separation pay due. The salesmen received monthly salaries of at least P400.00 and commission for every sale they made. The Collective Bargaining Agreements between Zuelig and the union of which Songco, et al. were members contained the following provision: "Any employee who is separated from employment due to old age, sickness, death or permanent lay-off, not due to the fault of said employee, shall receive from the company a retirement gratuity in an amount equivalent to one (1) month's salary per year of service." The Labor Arbiter ordered Zuelig to pay Songco et al., separation pay equivalent to their one month salary (exclusive of commissions, allowances, etc.) for every year of service with the company. The National Labor Relations Commission sustained the Arbiter. ISSUE: Whether or not earned sales commissions and allowances should be included in the monthly salary of Songco, et al. for the purpose of computing their separation pay.

RULING: In the computation of backwages and separation pay, account must be taken not only of the basic salary of the employee, but also of the transportation and emergency living allowances. Even if the commissions were in the form of incentives or encouragement, so that the salesman would be inspired to put a little more industry on jobs particularly assigned to them, still these commissions are direct remunerations for services rendered which contributed to the increase of income of the employee. Commission is the recompense compensation or reward of an agent, salesman, executor, trustee, receiver, factor, broker or bailee, when the same is calculated as a percentage on the amount of his transactions or on the profit to the principal. The nature of the work of a salesman and the reason for such type of remuneration for services rendered demonstrate that commissions are part of Songco, et al's wage or salary. The Court takes judicial notice of the fact that some salesmen do not receive any basic salary, but depend on commissions and allowances or commissions alone, although an employer-employee relationship exists. STATES MARINE CORPORATION vs. CEBU SEAMEN'S ASSOCIATION, INC. FACTS Petitioners States Marine Corporation and Royal Line, Inc. were engaged in the business of marine coastwise transportation, employing therein several steamships of Philippine registry. They had a collective bargaining contract with the respondent Cebu Seamen's Association, Inc. On September 12, 1952, the respondent union filed with the Court of Industrial Relations (CIR), a petition (Case No. 740-V) against the States Marine Corporation, later amended on May 4, 1953, by including as party respondent, the petitioner Royal Line, Inc. The Union alleged unfair labor practices which includes non-payment of overtime pay, sick leave, vacation leave, reduction of salaries, requirement of payment of P.40 per meal when employees are on board their vessels and illegal dismissal for Captain Asensi. Petitioner claim that very much below 30 members were members of the said union and they cannot be held liable as there is no law which provides for the payment of sick leave or vacation leave to employees or workers of private firms. With the payment of meals, they claimed that the Congress had in mind that the amount of P.40 per meal, furnished the employees should be deducted from the daily wages. And no illegal dismissal happened to Captain Asensi as such had his working contract ended. A decision was rendered on February 21, 1957 in favor of the respondent union. The motion for reconsideration thereof, having been denied, the companies filed the present writ of certiorari, to resolve legal question involved.

Issue Whether or not States Marine Corporation and Royal Line, Inc is liable for the following unfair labor practices against the respondent union Ruling "Supplements", constitute extra remuneration or special privileges or benefits given to or received by the laborers over and above their ordinary earnings or wages. "Facilities", on the other hand, are items of expense necessary for the laborer's and his family's existence and subsistence so that by express provision of law (Sec. 2[g]), they form part of the wage and when furnished by the employer are deductible therefrom, since if they are not so furnished, the laborer would spend and pay for them just the same. Meals were freely given to crew members prior to August 4, 1951, while they were on the high seas "not as part of their wages but as a necessary matter in the maintenance of the health and efficiency of the crew personnel during the voyage", the deductions therein made for the meals given after August 4, 1951, should be returned to them, and the operator of the coastwise vessels affected should continue giving the same benefit.. When the work is not continuous, the time during which the laborer is not working and can leave his working place and can rest completely shall not be counted", find no application in his case. Petitioner should be bound to pay overtime pay for hours beyond 8 hours of work Considering, however, that Captain Asensi had been laid-off for a long time and that his failure to report for work is not sufficient cause for his absolute dismissal, respondents are hereby ordered to reinstate him to his former job without back salary but under the same terms and conditions of employment existing prior to his lay-off, without loss of seniority and other benefits already acquired by him prior to March 20, 1952.

INTERNATIONAL SCHOOL ALLIANCE OF EDUCATORS VS. HON. LEONARDO QUISUMBING, ET AL. G.R. NO. 128845 JUNE 1, 2000 KAPUNAN, J.

Facts: Private respondent International School, Inc. (the School, for short), pursuant to Presidential Decree 732, is a domestic educational institution established primarily for dependents of foreign diplomatic personnel and other temporary residents.1 To enable the School to continue carrying out its educational program and improve its standard of instruction, Section 2(c) of the same decree authorizes the School to employ its own teaching and management personnel selected by it either locally or abroad, from Philippine or other nationalities, such personnel being exempt from otherwise applicable laws and regulations attending their employment, except laws that have been or will be enacted for the protection of employees. Accordingly, the School hires both foreign and local teachers as members of its faculty, classifying the same into two: (1) foreign-hires and (2) local-hires. The School grants foreign-hires certain benefits not accorded local-hires includeing housing, transportation, shipping costs, taxes, and home leave travel allowance. Foreign-hires are also paid a salary rate twenty-five percent (25%) more than local-hires. The School justifies the difference on two "significant economic disadvantages" foreign-hires have to endure, namely: (a) the "dislocation factor" and (b) limited tenure. The School explains: When negotiations for a new collective bargaining agreement were held on June 1995, petitioner International School Alliance of Educators, "a legitimate labor union and the collective bargaining representative of all faculty members"4 of the School, contested the difference in salary rates between foreign and local-hires. On September 7, 1995, petitioner filed a notice of strike. DOLE Acting Secretary, Crescenciano B. Trajano, issued an Order resolving the parity and representation issues in favor of the School. Then DOLE Secretary Leonardo A. Quisumbing subsequently denied petitioner's motion for reconsideration in an Order dated March 19, 1997. Petitioner now seeks relief in this Court. Issue: Whether the principle of “equal pay for equal work” shall be applied in the case at bar. Held: Yes. School contends that petitioner has not adduced evidence that local-hires perform work equal to that of foreign-hires. The Court finds this argument a little cavalier. If an employer accords employees the same position and rank, the presumption is that these employees perform equal work. This presumption is borne by logic and human experience. If the employer pays one employee less than the rest, it is not for that employee to explain why he receives less or why the others receive more. That would be adding insult to injury. The employer has discriminated against that employee; it is for the employer to explain why the employee is treated unfairly. The employer in this case has failed to discharge this burden. There is no evidence here that foreign-hires perform 25% more

efficiently or effectively than the local-hires. Both groups have similar functions and responsibilities, which they perform under similar working conditions. The School cannot invoke the need to entice foreign-hires to leave their domicile to rationalize the distinction in salary rates without violating the principle of equal work for equal pay. Salary means a recompense or consideration made to a person for his pains or industry in another man's business. Whether it be derived from "salarium," or more fancifully from "sal," the pay of the Roman soldier, it carries with it the fundamental idea of compensation for services rendered. While we recognize the need of the School to attract foreign-hires, salaries should not be used as an enticement to the prejudice of local-hires. The local-hires perform the same services as foreign-hires and they ought to be paid the same salaries as the latter. For the same reason, the "dislocation factor" and the foreign-hires' limited tenure also cannot serve as valid bases for the distinction in salary rates. The dislocation factor and limited tenure affecting foreign-hires are adequately compensated by certain benefits accorded them which are not enjoyed by localhires, such as housing, transportation, shipping costs, taxes and home leave travel allowances. The Constitution enjoins the State to "protect the rights of workers and promote their welfare," "to afford labor full protection." The State, therefore, has the right and duty to regulate the relations between labor and capital. CEBU INSTITUTE OF TECHNOLOGY (CIT) VS. HON. BLAS OPLE G.R. NO. L-58870 DECEMBER 18, 1987 CORTES, J. FACTS: The case was originated from a complaint filed with the Regional Office No. VII of the Ministry of Labor on February 11, 1981 against petitioner Cebu Institute of Technology (CIT) by private respondents, Panfilo Canete, et al., teachers of CIT, for non-payment of: a) cost of living allowances (COLA) under Pres. Dec. Nos. 525, 1123, 1614, 1678 and 1713, b) thirteenth (13th) month pay differentials and c) service incentive leave. By virtue of an Order issued by the then Deputy Minister of Labor Carmelo C. Noriel, a labor-management committee composed of one representative each from the Ministry of Labor and Employment (MOLE), the Minister of Education, Culture and Sports (MECS), and two representatives each from CIT and from the teachers was created. Said committee was to ascertain compliance with the legal requirements for the payment of COLA, thirteenth (13th) month pay and service incentive leave. On September 29, 1981 the Ministry of labor and employment ordered the CIT pay its teaching staff their COLA and Service incentive leave and further directed to integrate into the basic salaries of its teachers. Issue: WON the claimed of the petitioner that the payment of COLA by way of salary increases is in line with Pres. Dec. No. 451 and that the payment of the thirteenth

month pay to its employees was exempt from the payment of service incentive leave to its teachers who were employed on contract basis. Ruling: The Order of respondent Minister of Labor and Employment dated September 29, 1981 is sustained insofar as it ordered petitioner Cebu Institute of Technology to pay its teaching staff the following: Cost of living allowance under Pres. Dec.Nos.525 and 1123 from February 1978 up to 1981; Cost of living allowance under Pres. Dec. Nos. 1614, 1634, 1678 and 1713; and Service incentive leave due them from 1978. ASOK BIG WEDGE MINING CO. INC V ASOK BIG WEDGE MUTUAL BENEFIT ASSOCIATION G.R. L-3276 MARCH 3, 1953 Facts: On September 4, 1950, demand was submitted to petitioner by respondent union through its officers for various concession, among which were (a) an increase of P0.50 in wages, (b) commutation of sick and vacation leave if not enjoyed during the year, (c) various privileges, such as free medical care, medicine, and hospitalization, (d) right to a closed shop, check off, etc., (e) no dismissal without prior just cause and with a prior investigation, etc. Some of the demands, were granted by the petitioner, and the other were rejected, and so hearings were held and evidence submitted on the latter. After the hearing the respondent court rendered a decision, the most important provisions of which were those fixing the minimum wage for the laborers at P3.20, declaring that additional compensation representing efficiency bonus should not be included as part of the wage. Issue: Whether or not additional compensation representing efficiency bonus should not be part of the minimum wage, and the wage increase is valid? Held: Yes, that the P3 minimum wage fixed in the law is still far below what is considered a fair and just minimum is shown by the fact that this amount is only for the year after the law takes effect, as thereafter the law fixes it at P4. Neither may it be correctly contended that the demand for increase is due to an alleged pernicious practice. Frequent demands for increase are indicative of a healthy spirit of wakefulness to the demands of a progressing and an increasingly more expensive world. We, therefore, find no reason or ground for disturbing the finding contained in the decision fixing the amount of P3.20 as the minimum wage. if it is an additional compensation which the employer promised and agreed to give without any conditions imposed for its payment, such as success of business or greater production or output, then it is part of the wage. But if it is paid only if profits are realized or a certain amount of productivity achieved, it

cannot be considered part of the wages. In the case at bar, it is not payable to all but to laborers only. It is also paid on the basis of actual production or actual work accomplished. If the desired goal of production is not obtained or the amount of actual work accomplished, the bonus does not accrue. It is evidence that under the circumstances it is paid only when the labor becomes more efficient or more productive. It is only an inducement for efficiency, a prize there for, not a part of the wage. DE RACHO VS. MUNICIPALITY OF ILIGAN G.R. NO. L-23542 JANUARY 2, 1968 BENGZON, J.P., J. FACTS: Plaintiff Juana T. Vda. de Racho and the decedent, Manuel Racho, were spouses and had five minor children. On July 1, 1954 the decedent was appointed as market cleaner in the Municipality of Ilagan, Isabela, at the rate of P660.00 per annum (P55.00 monthly) which amount he received up to June 30, 1958. On July 1, 1958, decedent's salary was increased to P720.00 per annum (P60.00 monthly) by virtue of a promotional appointment extended to him by the Municipal Mayor. Decedent was then paid the money value of his accumulated leaves. Decedent died intestate at Ilagan. Plaintiff then filed on December 9, 1960 a claim for salary differentials with the Regional Office of the Department of Labor, which dropped the case later for lack of jurisdiction. Based on the foregoing facts, the Court of First Instance of Isabela ruled that defendant Municipality of Ilagan must pay P1,766.00 to plaintiff representing the wage differentials and adjusted terminal leave of the decedent from December 9, 1957 to May 23, 1960, based on the monthly wage rate of P120.00 pursuant to the Minimum Wage Law. ISSUE: Whether or not the shortage and lack of available funds and expected revenue of a municipality validly exempt from complying with the Minimum Wage Law. HELD: The appealed judgment is affirmed. Lack of funds of a municipality does not excuse it from paying the statutory minimum wages to its employees, which, after all, is a mandatory statutory obligation of the municipality. To uphold such defense of lack of available funds would render the Minimum Wage Law futile and defeat its purpose. This also disposes of the implication appellant is trying to make that its duty to pay minimum wages is not a statutory obligation which would command preference in the municipal budget and appropriation ordinance. Moreover, we cannot sanction appellant's proposition that it would eventually and gradually implement the Minimum Wage Law, "if and when its revenues can afford." The law — insofar as it affects government employees — took effect in 1952. It should have been implemented — or at least steps to implement it should

have been taken — right then. To excuse the defendant municipality now would be to permit it to benefit from its non-feasance. It would also make the effectivity of the law dependent upon the will and initiative of said municipality without statutory sanction. Defendant's remedy, therefore, is not to seek an excuse from implementing the law but, as the lower court suggested, to upgrade and improve its tax collection machinery with a view towards realizing more revenues. Or, it could for the present forego all non-essential expenditures. PLANAS COMMERCIAL V. NLRC, A. OFIALDA, ET AL NOV. 11, 2005 G.R. NO. 144619 FACTS: In September 1993, Morente, Allauigan and Ofialda and others filed a complaint for underpayment of wages, non payment of overtime pay, holiday pay, service incentive leave pay, and premium pay for rest day and holiday and night shift differential against petitioners in the Arbitration Branch of NLRC. It alleged that Cohu is engaged in the business of wholesale of plastic products and fruits of different kinds with more than 24 employees. Respondents were hired on January 1990, May 1990 and July 19991 as laborers and were paid below the minimum wage for the past 3 years. They were required to work for more than 8 hours a day and never enjoyed the minimum benefits. Petitioners filed their comment stating that the respondents were their helpers. The Labor Arbiter rendered a decision dismissing the money claims. Respondents filed an appeal with the NLRC where it granted the money claims of Ofialda, Morente and Allaguian. Petitioners appealed with the CA but it was denied. It said that the company having claimed of exemption of the coverage of the minimum wage shall have the burden of proof to the claim. In the present petition, the Petitioners insist that C. Planas Commercial is a retail establishment principally engaged in the sale of plastic products and fruits to the customers for personal use, thus exempted from the application of the minimum wage law; that it merely leases and occupies a stall in the Divisoria Market and the level of its business activity requires and sustains only less than ten employees at a time. Petitioners contend that private respondents were paid over and above the minimum wage required for a retail establishment, thus the Labor Arbiter is correct in ruling that private respondents’ claim for underpayment has no factual and legal basis. Petitioners claim that since private respondents alleged that petitioners employed 24 workers, it was incumbent upon them to prove such allegation which private respondents failed to do. Issue: Whether or not petitioner is exempted from the application of minimum wage law Held:

The contention of the petitioners that they are exempted by the law must be proven. The petitioners have not successfully shown that they had applied for the exemption. R.A. No. 6727 known as the Wage Rationalization Act provides for the statutory minimum wage rate of all workers and employees in the private sector. Section 4 of the Act provides for exemption from the coverage, thus: Sec. 4. (c) Exempted from the provisions of this Act are household or domestic helpers and persons employed in the personal service of another, including family drivers. Also, retail/service establishments regularly employing not more than ten (10) workers may be exempted from the applicability of this Act upon application with and as determined by the appropriate Regional Board in accordance with the applicable rules and regulations issued by the Commission. Whenever an application for exemption has been duly filed with the appropriate Regional Board, action on any complaint for alleged non-compliance with this Act shall be deferred pending resolution of the application for exemption by the appropriate Regional Board. In the event that applications for exemptions are not granted, employees shall receive the appropriate compensation due them as provided for by this Act plus interest of one percent (1%) per month retroactive to the effectivity of this Act. Clearly, for a retail/service establishment to be exempted from the coverage of the minimum wage law, it must be shown that the establishment is regularly employing not more than ten (10) workers and had applied for exemptions with and as determined by the appropriate Regional Board in accordance with the applicable rules and regulations issued by the Commission.

DAVAO INTEGRATED PORT STEVEDORING SERVICES VS. RUBEN ABARQUEZ G.R. NO. 102132 MARCH 19, 1993 ROMERO, J. Facts: Petitioner-company and respondent-union entered into a collective bargaining agreement which includes provisions on sick leave with pay benefits each year to employees who have rendered at least one year of service with the former. Unused sick leaves shall then be converted into cash by the end of the year. Said CBA provision covers both intermittent and non-intermittent employees but with differences in the manner of computing the pay. Upon renewing the CBA, the petitioner-company’s new assistant manager discontinued the intermittent employee’s unused sick leave cash conversion on the basis that the last sentence of the CBA disqualifies them to enjoy such benefits. Further, said assistant manager stated that his predecessor committed a wrongfully understood and applied the said CBA. Eventually, Voluntary Arbitrator Ruben Abarquez decided on the matter and ruled in favor of the respondent-union. Petitioner-company disagreed with Abarquez.

Issue: Whether or not petitioner-company has the right to remove the existing benefits of the employees? Ruling: No. The Supreme Court finds two applicable legal basis: (1) the essence of the terms and conditions of a CBA which is more than regular contract but which is the law that regulates the relationship between labor and capital. It is impressed with public interest which requires it to yield to the common good; (2) Article 100 of the Labor Code which prohibits the construction of labor provision which would lead to the elimination, or in any way diminution of the supplements or other employee benefits. In the instant case, and after careful scrutiny of the CBA between the parties, it was clarified that the cash conversion of the unused sick leaves are applicable to employees who have complied with the following requirements: (1) the employee should be regular and at least rendered one year of service with the company; and (2) said claim should be certified by a company-designated physician. From the said requirements, it is quite obvious that both intermittent and non-intermittent employees could qualify to receive the unused sick leaves as long as they have met the requirements of the CBA. The contention of the petitioner-company, as to the last sentence of the CBA, only applies to those employees who have not successfully satisfied the said provisions above. Therefore, the Court dismissed the petition and affirmed the decision of Abarquez.

NESTLÉ PHILIPPINES, INC. VS. NLRC G.R. NO. 91231 FEBRUARY 4, 1991 GRIÑO-AQUINO, J. FACTS: Nestlé Philippines, Inc., by this petition for certiorari, seeks to annul, on the ground of grave abuse of discretion, the decision dated August 8, 1989 of the National Labor Relations Commission (NLRC), Second Division, in Cert. Case No. 0522 entitled, "In Re: Labor Dispute of Nestlé Philippines, Inc." insofar as it modified the petitioner's existing non-contributory Retirement Plan. Four (4) collective bargaining agreements separately covering the petitioner's employees in its: Alabang/Cabuyao factories; Makati Administration Office. (Both Alabang/Cabuyao factories and Makati office were represented by the respondent, Union of Filipro Employees [UFE]); Cagayan de Oro Factory represented by WATU; and

Cebu/Davao Sales Offices represented by the Trade Union of the Philippines and Allied Services (TUPAS), all expired on June 30, 1987. Thereafter, UFE was certified as the sole and exclusive bargaining agent for all regular rank-and-file employees at the petitioner's Cagayan de Oro factory, as well as its Cebu/Davao Sales Office. In August, 1987, while the parties, were negotiating, the employees at Cabuyao resorted to a "slowdown" and walk-outs prompting the petitioner to shut down the factory. Marathon collective bargaining negotiations between the parties ensued. On September 2, 1987, the UFE declared a bargaining deadlock. On September 8, 1987, the Secretary of Labor assumed jurisdiction and issued a return to work order. In spite of that order, the union struck, without notice, at the Alabang/Cabuyao factory, the Makati office and Cagayan de Oro factory on September 11, 1987 up to December 8, 1987. The company retaliated by dismissing the union officers and members of the negotiating panel who participated in the illegal strike. The NLRC affirmed the dismissals on November 2, 1988. On January 26, 1988, UFE filed a notice of strike on the same ground of CBA deadlock and unfair labor practices. However, on March 30, 1988, the company was able to conclude a CBA with the union at the Cebu/Davao Sales Office, and on August 5, 1988, with the Cagayan de Oro factory workers. The union assailed the validity of those agreements and filed a case of unfair labor practice against the company on November 16, 1988. After conciliation efforts of the National Conciliation and Mediation Board (NCMB) yielded negative results, the dispute was certified to the NLRC by the Secretary of Labor on October 28, 1988. After the parties had filed their pleadings, the NLRC issued a resolution on June 5, 1989, whose pertinent disposition regarding the union's demand for liberalization of the company's retirement plan for its workers, provides as follows: xxx xxx xxx Retirement Plan The company shall continue implementing its retirement plan modified as follows: for fifteen years of service or less — an amount equal to 100% of the employee's monthly salary for every year of service; more than 15 but less than 20 years — 125% of the employee's monthly salary for every year of service; 20 years or more — 150% of the employee's monthly salary for every year of service. (pp. 58-59,Rollo.) Both parties separately moved for reconsideration of the decision. On August 8, 1989, the NLRC issued a resolution denying the motions for reconsideration. With regard to the Retirement Plan, the NLRC held:

Anent management's objection to the modification of its Retirement Plan, We find no cogent reason to alter our previous decision on this matter. While it is not disputed that the plan is non-contributory on the part of the workers, tills does not automatically remove it from the ambit of collective bargaining negotiations. On the contrary, the plan is specifically mentioned in the previous bargaining agreements (Exhibits "R-1" and "R-4"), thereby integrating or incorporating the provisions thereof to the agreement. By reason of its incorporation, the plan assumes a consensual character which cannot be terminated or modified at will by either party. Consequently, it becomes part and parcel of CBA negotiations. However, We need to clarify Our resolution on this issue. When we increased the emoluments in the plan, the conditions for the availment of the benefits set forth therein remain the same. (p. 32, Rollo.) On December 14, 1989, the petitioner filed this petition for certiorari, ISSUE: 1 Whether or not the retirement plan being non-contributory,a non-issue in the CBA negotiations? 2 Whether or not there was a grave abuse of discretion on the part of the NLRC in resolving the issue? HELD: 1 Since the retirement plan has been an integral part of the CBA since 1972, the Union's demand to increase the benefits due the employees under said plan, is a valid CBA issue. The deadlock between the company and the union on this issue was resolvable by the Secretary of Labor, or the NLRC, after the Secretary had assumed jurisdiction over the labor dispute (Art. 263, subparagraph [i] of the Labor Code). 2 The NLRC's resolution of the bargaining deadlock between Nestlé and its employees is neither arbitrary, capricious, nor whimsical. The benefits and concessions given to the employees were based on the NLRC's evaluation of the union's demands, the evidence adduced by the parties, the financial capacity of the Company to grant the demands, its longterm viability, the economic conditions prevailing in the country as they affect the purchasing power of the employees as well as its concommitant effect on the other factors of production, and the recent trends in the industry to which the Company belongs (p. 57, Rollo). Its decision is not vitiated by abuse of discretion. R. TIANGCO AND V. TIANGCO V. HON. VICENTE LEOGARDO, JR. G.R. NO. L-57636 MAY 16, 1983 CONCEPCION, JR., J. Facts:

Petitioner R. Tiangco was a fishing operator engaged in deep-sea fishing while V. Tiangco was a fishbroker. Mr. Ilustrisimo and 26 others were batillios engaged by petitioners to unload fishcatch from the vessels and take them to the fish stall. The work of these batillios was limited to days of arrival of the fishing vessels, hence, they work only a few days in a month averaging 4 hours a day. In April 1980, Mr. Illustrisimo, and others filed a complaint against the Tiangcos for (1) nonpayment of legal holiday pay, (2) service incentive leave pay, as well as (3) underpayment of emergency cost-of-living allowances [ECOLA] which used to be paid in full irrespective of their work days. The Tiangcos denied the laborers; contentions. But as regards the claim for emergency allowance differentials, they admitted that they discontinued their practice of paying a fixed monthly allowance, and allowances for nonworking days. They invoked the principle of “No work, no pay.” Ruling: The workers’ claim is valid. Since the Tiangcos had been paying the workers a fixed monthly emergency allowance since November 1976 to February 1980, as a matter of practice and/or verbal agreement between the parties, the discontinuance of the practice and/or verbal agreement between the petitioners and the private respondents contravened the provisions of the Labor Code, particularly Article 100. It prohibits the elimination or diminution of existing benefits such as the ECOLA. [Note that the monthly allowance was initiated in November 1976, two years after the Labor Code was promulgated in 1974.] Section 15 of the rules on P.D. No. 525 and Sec. 16 of the rules on P.D. No. 1123 also prohibit the diminution of any benefit granted to the employees under existing laws, agreements and voluntary employer practice. GLOBE MACKAY CABLE AND RADIO CORPORATION VS. NLRC,FFW G.R. NO. 74156 JUNE 29, 1988 MELENCIO-HERRERA, J., FACTS: Wage Order No. 6 increased the cost-of -living allowance of nonAgricultural workers in the private sector. Petitioner corporation (GMCR) complied with the said Wage Order by paying its monthly-paid employees the mandated P3.00 per day COLA. However, in computing said COLA, GMCR multiplied the P3.00 daily COLA by 22days, which is the number of working days in the company.

Respondent Union disagreed with the computation of the monthly COLA claiming that the daily COLA rate of P3.00 should be multiplied by 30 days to arrive at the monthly COLA rate. The union alleged furthermore that prior to the effectivity of Wage Order No. 6, GMCR had been computing and paying the monthly COLA on the basis of thirty (30) days per month and that this constituted an employer practice, which should not be unilaterally withdrawn. ISSUE: Whether or not petitioner, in computing COLA based on the number of working days of the company , violated Article100 of the Labor Code of the Philippines HELD: There is no violation of Article 100 of the Labor Code on prohibition of wage diminution. The primordial consideration for entitlement to COLA is that basic wage is being paid. In other words, the payment of COLA is mandated only for the days that the employees are paid their basic wage, even if said days are un worked. So that, on the days that employees are not paid their basic wage, the payment of COLA is not mandated. Peculiar to this case, however, is the circumstance that pursuant to the Collective Bargaining Agreement (CBA) between Petitioner and Respondent Union, the monthly basic pay is computed on the basis of five (5) days a week, or twenty two(22) days a month. In determining the hourly rate of monthly paid employees for purposes of computing overtime pay, the monthly wage is divided by the number of actual work days in a month and then, by eight (8) working hours. If a monthly-paid employee renders overtime work, he is paid his basic salary rate plus one-half thereof. Thus, where the company observes a 5-day work week, it will have to be held that the COLA should be computed on the basis of twenty two (22) days, which is the period during which the employees of petitioner receive their basic wage. The CBA is the law between the parties and, if not acceptable, can be the subject of future renegotiation. Payment in full by petitioner of the COLA before the execution of the CBA incompliance with Wage Orders Nos. 1 to 5, should not be construed as constitutive of voluntary employer practice, which cannot now be unilaterally withdrawn by petitioner. To be considered as such, it should have been practiced over a long period of time, and must be shown to have been consistent and deliberate. Adequate proof is wanting in this respect. The test of long practice has been enunciated in Oceanic Pharmaceutical Employees Union vs. Inciong such that “respondent company agreed to continue giving holiday pay knowing fully well that said employees are not covered by the law requiring payment of holiday pay."Absent clear administrative guidelines, petitioner cannot be faulted for erroneous application of the law. Payment may be said to have been made by reason of a mistake in the construction or application of a "doubtful or difficult question of law."Since it is a past error that is being corrected, no vested right may be said to have arisen nor any diminution of benefit under Article 100 of the Labor Code may be said to have resulted by virtue of the correction.

SAMAHANG MANGGAGAWA SA TOP FORM MANUFACTURING UNITED WORKERS OF THE PHILIPPINES (SMTFM-UWP VS. NLRC. G.R. NO. 113856 SEPTEMBER 7, 1998 ROMERO, J. FACTS Petitioner Samahang Manggagawa sa Top Form Manufacturing — United Workers of the Philippines (SMTFM) was the certified collective bargaining representative of all regular rank and file employees of private respondent Top Form Manufacturing Philippines, Inc. he charge arose from the employer's refusal to grant across-the-board increases to its employees in implementing Wage Orders Nos. 01 and 02 of the Regional Tripartite Wages and Productivity Board of the National Capital Region (RTWPB-NCR). Such refusal was aggravated by the fact that prior to the issuance of said wage orders, the employer allegedly promised at the collective bargaining conferences to implement any government-mandated wage increases on an across-the-board basis. ISSUE Whether or not the employer committed unfair labor practice by bargaining in bad faith and discriminating against its employees. RULING The basic premise of this argument is definitely untenable. To start with, if there was indeed a promise or undertaking on the part of private respondent to obligate itself to grant an automatic across-the-board wage increase, petitioner union should have requested or demanded that such "promise or undertaking" be incorporated in the CBA. After all, petitioner union has the means under the law to compel private respondent to incorporate this specific economic proposal in the CBA. It could have invoked Article 252 of the Labor Code defining "duty to bargain," thus, the duty includes "executing a contract incorporating such agreements if requested by either party." Petitioner union's assertion that it had insisted on the incorporation of the same proposal may have a factual basis considering the allegations in the aforementioned joint affidavit of its members. However, Article 252 also states that the duty to bargain "does not compel any party to agree to a proposal or make any concession." Thus, petitioner union may not validly claim that the proposal embodied in the Minutes of the negotiation forms part of the CBA that it finally entered into with private respondent. The Court likewise finds unmeritorious petitioner union's contention that by its failure to grant across-the-board wage increases, private respondent violated the provisions of Section 5, Article VII of the existing CBA as well as Article 100 of the Labor Code. We agree with the Labor Arbiter and the NLRC that no benefits or privileges previously enjoyed by petitioner union and the other employees were withdrawn as a result of the manner by which private respondent implemented the wage

orders. Granted that private respondent had granted an across-the-board increase pursuant to Republic Act No. 6727, that single instance may not be considered an established company practice. Petitioner union's argument in this regard is actually tied up with its claim that the implementation of Wage Orders Nos. 01 and 02 by private respondent resulted in wage distortion. PAG-ASA STEEL WORKS, INC. VS. CA AND PAG-ASA STEEL WORKERS UNION G.R. NO.166647 MARCH 31, 2006 FACTS: Petitioner Pag-Asa Steel Works, Inc. is a corporation duly organized and existing under Philippine laws and is engaged in the manufacture of steel bars and wire rods. Pag-Asa Steel Workers Union is the duly authorized bargaining agent of the rank-and-file employees. RTWPB of NCR issued a wage order which provided for a P 13.00 increase of the salaries receiving minimum wages. The Petitioner and the union negotiated on the increase. Petitioner forwarded a letter to the union with the list of adjustments involving rank and file employees. In September 1999, the petitioner and union entered into an collective bargaining agreement where it provided wage adjustments namely P15, P25, P30 for three succeeding year. On the first year, the increase provided were followed until RTWPB issued another wage order where it provided for a P25.50 per day increase in the salary of employees receiving the minimum wage and increased the minimum wage to P223.50 per day. Petitioner paid the P25.50 per day increase to all of its rank-and-file employees. On November 2000, Wage Order No. NCR-08 was issued where it provided the increase of P26.50 per day. The union president asked that the wage order be implemented where petitioner rejected the request claiming that there was no wage distortion and it was not obliged to grant the wage increase. The union submitted the matter for voluntary arbitration where it favored the position of the company and dismissed the complaint. The matter was elevated to CA where it favored the respondents. Hence, this petition.

Issue: Whether or not the company was obliged to grant the wage increase under Wage Order No. NCR-08 as a matter of practice. Held: The Court favors the petitioner that wage increase shall not be granted by virtue of CBA or matter of practice by the company. It is submitted that employers unless exempt are mandated to implement the said wage order but limited to

those entitled thereto. There is no legal basis to implement the same across-theboard. A perusal of the record shows that the lowest paid employee before the implementation of Wage Order #8 is P250.00/day and none was receiving below P223.50 minimum. This could only mean that the union can no longer demand for any wage distortion adjustment. The provision of wage order #8 and its implementing rules are very clear as to who are entitled to the P26.50/day increase, i.e., "private sector workers and employees in the National Capital Region receiving the prescribed daily minimum wage rate of P223.50 shall receive an increase of Twenty-Six Pesos and Fifty Centavos (P26.50) per day," and since the lowest paid is P250.00/day the company is not obliged to adjust the wages of the workers. The provision in the CBA that "Any Wage Order to be implemented by the Regional Tripartite Wage and Productivity Board shall be in addition to the wage increase adverted above" cannot be interpreted in support of an across-the-board increase. If such were the intentions of this provision, then the company could have simply accepted the original demand of the union for such across-the-board implementation, as set forth in their original proposal. The fact that the company rejected this proposal can only mean that it was never its intention to agree, to such across-the-board implementation. Wage Order No. NCR-08 clearly states that only those employees receiving salaries below the prescribed minimum wage are entitled to the wage increase provided therein, and not all employees acrossthe-board as respondent Union would want petitioner to do. Considering therefore that none of the members of respondent Union are receiving salaries below the P250.00 minimum wage, petitioner is not obliged to grant the wage increase to them. Moreover, to ripen into a company practice that is demandable as a matter of right, the giving of the increase should not be by reason of a strict legal or contractual obligation, but by reason of an act of liberality on the part of the employer. Hence, even if the company continuously grants a wage increase as mandated by a wage order or pursuant to a CBA, the same would not automatically ripen into a company practice. NATIONAL SUGAR REFINERIES CORP V. NLRC G.R. NO. 101761 MARCH 24, 1993 REGALADO, J. Facts: Petitioner National Sugar Refineries Corporation (NASUREFCO), a corporation which is fully owned and controlled by the Government, operates three (3) sugar refineries located at Bukidnon, Iloilo and Batangas. Private respondent union represents the former supervisors of the NASUREFCO Batangas Sugar Refinery. In 1988, petitioner implemented a Job Evaluation (JE) Program affecting all employees, from rank-and-file to department heads. We glean from the records that for about ten years prior to the JE Program, the members of respondent union were treated in the same manner as rank-and file employees. As such, they

used to be paid overtime, rest day and holiday pay pursuant to the provisions of Articles 87, 93 and 94 of the Labor Code as amended with the implementation of the JE Program, members of respondent union were re-classified under levels S-5 to S-8 which are considered managerial staff for purposes of compensation and benefits. In June 1990, the members of herein respondent union filed a complainant with the executive labor arbiter for non-payment of overtime, rest day and holiday pay allegedly in violation of Article 100 of the Labor Code. In 1991, Executive Labor Arbiter Pido directed NASUREFCO to pay for the wages complained of. On appeal, in a decision promulgated on July 1991, respondent National Labor Relations Commission (NLRC) affirmed the decision of the labor arbiter on the ground that the members of respondent union are not managerial employees, and, therefore, they are entitled to overtime, rest day and holiday pay. Respondent NLRC declared that these supervisory employees are merely exercising recommendatory powers subject to the evaluation, review and final action by their department heads. Issue: Whether the Supervisors are considered Managerial Employees and should no longer receive overtime, rest day and holiday pay. Held: Yes. Under Art. 82 Coverage. — The provisions of this title shall apply to employees in all establishments and undertakings whether for profit or not, but not to government employees, managerial employees, field personnel, members of the family of the employer who are dependent on him for support, domestic helpers, persons in the personal service of another, and workers who are paid by results as determined by the Secretary of Labor in Appropriate regulations. As used herein, 'managerial employees' refer to those whose primary duty consists of the management of the establishment in which they are employed or of a department or subdivision thereof, and to other officers or members of the managerial staff. It is the submission of petitioner that while the members of respondent union, as supervisors, may not be occupying managerial positions, they are clearly officers or members of the managerial staff because they meet all the conditions prescribed by law and, hence, they are not entitled to overtime, rest day. Quintessentially, with the promotion of the union members, they are no longer entitled to the benefits which attach and pertain exclusively to their positions. Entitlement to the benefits provided for by law requires prior compliance with the conditions set forth therein. With the promotion of the members of respondent union, they occupied positions which no longer met the requirements imposed by law. Their assumption of these positions removed them from the coverage of the law, ergo, their exemption there from. As correctly pointed out by petitioner, if the union members really wanted to continue receiving the benefits which attach to their former positions, there was nothing to prevent them from

refusing to accept their promotions and their corresponding benefits. As the saying goes by, they could not, as a simple matter of law and fairness, get the best of both worlds at the expense of NASUREFCO. Promotion of its employees is one of the jurisprudentially-recognized exclusive prerogatives of management, provided it is done in good faith. In the case at bar, private respondent union has miserably failed to convince this Court that the petitioner acted implementing the JE Program. There is no showing that the JE Program was intended to circumvent the law and deprive the members of respondent union of the benefits they used to receive. AMERICAN WIRE & CABLE DAILY RATED EMPLOYEES UNION VS. AMERCAN WIRE & CABLE CO., INC., & THE COURT OF APPEALS G.R. NO. 155059 APRIL 29, 2005 Facts: American Wire and Cable Co., Inc., is a corporation engaged in the manufacture of wires and cables. There are two unions in this company, the American Wire and Cable Monthly-Rated Employees Union and the American Wire and Cable Daily-Rated Employees Union. On 16 February 2001, an original action was filed before the NCMB of the Department of Labor and Employment by the two unions for voluntary arbitration. They alleged that the private respondent, without valid cause, suddenly and unilaterally withdrew and denied certain benefits and entitlements which they have long enjoyed. These are Service Award, 35% premium pay of an employee’s basic pay for the work rendered during Holy Monday, Holy Tuesday, Holy Wednesday, December 23, 26, 27, 28 and 29, Christmas Party and Promotional Increase. Issue: Whether or not the respondent company violated Article 100 of the Labor Code. Ruling: The Court ruled that company is not guilty of violating Art. 100 of the Labor Code. Article 100 of the Labor Code provides: PROHIBITION AGAINST ELIMINATION OR DIMINUTION OF BENEFITS. – Nothing in this Book shall be construed to eliminate or in any way diminish supplements, or other employee benefits being enjoyed at the time of promulgation of this Code. The certain benefits and entitlements are considered bonuses. A bonus can only be enforceable and demandable if it has ripened into a company practice. It must also be expressly agreed by the employer and employee or it must be on a fixed amount.

The assailed benefits were never subjects of any agreement between the union and the company. It was never incorporated in the CBA. Since all these benefits are in the form of bonuses, it is neither enforceable nor demandable. TRADERS ROYAL BANK VS. NLRC G.R. NO. 88168 AUGUST 30, 1990 FACTS On November 1986, TRB employees union filed a complaint with the NLRC for diminution of benefits regarding holiday pay, mid-year and year-end bonuses.2.NLRC ordered the Bank to pay the employees holiday pay differentials for 1983-1986, as well as mid-year and year-end bonus differential for 1986. ISSUE Did the NLRC abuse its discretion in ordering the payment of mid-year and yearend bonus differentials? HELD YES. A bonus is a gratuity or an act of liberality of the giver which the recipient has no right to demand as a matter of right. The granting of bonus is basically a management prerogative which cannot be forced upon the employer. In the case at bar, the matter of giving bonuses over and above lawful salaries and allowances is entirely on the profits realized by the Bank. In 1986, the Bank weakened considerably due to suspicions that it was a Marcos-owned and controlled bank, and was placed under sequestration by the PCGG.The union contention that the granting of bonuses has ripened into a company practice that may not be adjusted to the prevailing financial condition of the Bank, has no legal or moral bases. Its fiscal condition having declined, the Bank may not be forced to give bonuses it cannot pay, and in effect, be penalized for its past generosity to its employees. There can be no diminution of benefits because bonuses are not part of labor standards in the same class as salaries, cost of living allowances, holiday pay and leave benefits. The NLRC is modified by deleting the award for bonus differentials for 1986 NATIONAL FEDERATION OF SUGAR WORKERS (NFSW) VS. OVAJERA G.R. NO. L- 59743 MAY 31, 1982 PLANA, J. FACTS: In 1981, NFSW struck allegedly to compel the payment of the 13th month pay under PD 851, in addition to the Christmas, milling and amelioration bonuses being enjoyed by CAC workers. The decision having become final and executory entry of judgment was made. After the Marcopper decision had become final,

NFSW renewed its demand that CAC give the 13th month pay. CAC refused, NFSW filed with the Ministry of Labor and Employment (MOLE) Regional Office in Bacolod City a notice to strike based on non-payment of the 13th month pay. Six days after, NFSW struck. ISSUE: Whether or not under Presidential Decree 851 (13th Month Pay Law), CAC is obliged to give its workers a 13th month salary in addition to Christmas, milling and amelioration bonuses, the aggregate of which admittedly exceeds by far the disputed 13th month pay? HELD: CAC is obliged to give its workers a 13th month salary in addition to Christmas, milling and amelioration bonuses stipulated in a collective bargaining agreement amounting to more than a month’s pay. When this agreement was forged on November 30,1981, the original decision dismissing the petition in the aforecited Marcopper case had already been promulgated by this Court. On the votes of only 7Justices, including the distinguished Chief Justice, the petition of Marcopper Mining Corp. seeking to annul the decision of Labor Deputy Minister Amado Inciong granting a 13th month pay to Marcopper employees (in addition to midyear and Christmas bonuses under a CBA) had been dismissed. But amotion for reconsideration filed by Marcopper was pending as of November 30, 1981. In December 1981,the original decision was affirmed when this Court finally denied the motion for reconsideration. But theresolution of denial was supported by the votes of only 5 Justices. The Marcopper decision is therefore a Court decision but without the necessary eight votes to be doctrinal. This being so, it cannot be said that the Marcopper decision "clearly held" that "the employer is liable to pay a 13th month pay separate and distinct from the bonuses already given," within the meaning of the NFSW-CAC compromise agreement. At any rate, in view of the rulings made herein, NFSW cannot insist on its claim that its members are entitled to a 13th month pay in addition to the bonuses already paid by CAC. WHEREFORE, the petitionis dismissed for lack of merit. No costs. UNIVERSAL CORN PRODUCTS VS. NLRC G.R. NO.L-60337 AUG. 21, 1987 SARMIENTO, J. FACTS: In 1972, the petitioner and the Universal Corn Products Workers Union entered into a collective bargaining agreement. The COMPANYagrees to grant all regular workers within the bargaining unit with at least one (1) year of continuous service, a Christmas bonusequivalent to the regular wages for seven (7) working days. The agreement had a duration of three years. On account however of differences between the parties with respect to certain economic issues, the collective bargaining agreement in question expired withoutbeing renewed. In 1979, the parties entered into an "addendum" stipulating certain

wage increases covering the years from 1974 to1977.Simultaneously, they entered into a collective bargaining agreement for the years from 1979 to 1981. Like the "addendum," the newcollective bargaining agreement did not refer to the "Christmas bonus" theretofore paid but dealt only with salary adjustments.According to the petitioner, the new agreements deliberately excluded the grant of Christmas bonus with the enactment of PresidentialDecree No. 851.It further claims that since 1975, it had been paying its employees 13thmonth pay pursuant to the Decree. For failure of the petitioner topay the sevenday Christmas bonus for 1975 to 1978 inclusive, in accordance with the 1972 CBA, the union went to the labor arbiter forrelief. In his decision, the labor arbiter ruled that the payment of the 13th month pay precluded the payment of further Christmas bonus.The union appealed to NLRC. The NLRC set aside the decision of the labor arbiter appealed from and entered another one, "directingrespondent company now the petitioner to pay the members concerned of complainants union their 7-day wage bonus in accordancewith the 1972 CBA from 1975 to 1978. ISSUE: Whether or not the Christmas bonus can be considered as 13th month pay HELD: The collective bargaining agreement accords a reward, in this case, for loyalty, to certain employees. This is evident from the stipulationgranting the bonus in question to workers "with at least one (1) year of continuous service is a purpose not found in P.D. 851. It isclaimed, however, that as a consequence of the impasse between the parties beginning 1974 through 1979, no collective bargainingagreement was in force during those intervening years. Hence, there is allegedly no basis for the money award granted by therespondent labor body.The fact, therefore, that the new agreements are silent on the seven-day bonus demanded should not preclude the private respondents'claims thereon. The 1972 agreement is basis enough for such claims for the whole writing is instinct with an obligation, imperfectlyexpress.WHEREFORE, premises considered, the petition is hereby DISMISSED. The Decision of the public respondent NLRC promulgated onFebruary 11, 1982, and its Resolution dated March 23, 1982, are hereby AFFIRMED. The temporary restraining order issued on May 19,1982 is LIFTED PHILIPPINE AIRLINES, INC. (PAL) VS. NLRC G.R. NO. 114280 JULY 26, 1996 FRANCISCO, J. FACTS: Refusing to pay its pilots their thirteenth month pay for unfair labor practice was filed against Philippine Airlines by the Airline Pilots Association of the Philippines. The Labor Arbiter ruled in favor of ALPAP and ordered PAL to pay its pilots belonging to ALPAP their thirteenth month pay from 1988 to1990. Disputing PAL's contention, ALPAP argued that the payment of the year-end bonus cannot be equated within the thirteenth month pay since the payment of

the former is conditional in character andnot fixed in its amount, while that of the thirteenth month pay is mandatory in character and definite in its. Both parties appealed to the National Labor Relations Commission which in turn affirmed with modifications the decision of the Labor Arbiter. ISSUE: Whether or not PAL can claim the exception provided under the law by equation the year-endbonus with the payment of the thirteenth month pay deserves a very close scrutiny in this case? HELD: It appears that the rationale for the grant of the year-end bonus by PAL coincides with the natureof the bonus which can be equated with the payment of a thirteenth month pay. However, notwithstandingthe above disquisitions, the peculiar circumstances in this case wavers against the outright application ofthe rule preventing the imposition of a double burden against the employer who is already paying theequivalent of the thirteenth month pay, and hereby exempt PAL from granting both benefits of a year-endbonus and a thirteenth month pay to its pilots. The inclusion of a provision for the continued payment ofthe yearend bonus in the 1988-1991 CBA of ALPAP and PAL belies the latter contention that the grant ofthe year-end bonus was intended to be credited as compliance with the mandate to pay the pilots athirteenth month pay.As early as said date, PAL was therefore fully aware that it was legally obliged togrant all its rank and file employees a thirteenth month pay. Moreover, there is no rational basis forwithholding from the members of ALPAP the benefit of a year-end bonus is addition to the thirteenthmonth pay, while the same being granted to the other rank and field employees of PAL. WHEREFORE,finding no merit in the petitions, the same are hereby DENIED and the Resolutions of public respondentNLRC promulgated on November 23, 1993 and February 28, 1994 are hereby AFFIRMED. SAN MIGUEL CORPORATION (CAGAYAN COCA-COLA PLANT) VS. INCIONG G.R. NO. L-49774 FEBRUARY 24, 1981 DE CASTRO, J. Facts: On January 3, 1977, Cagayan Coca-Cola Free Workers Union, private respondent herein, filed a complaint against San Miguel Corporation (Cagayan Coca-Cola Plant), petitioner herein, alleging failure or refusal of the latter to include in the computation of 13th- month pay such items as sick, vacation or maternity leaves, premium for work done on rest days and special holidays, including pay for regular holidays and night differentials. An Order 3 dated February 15, 1977 was issued by Regional Office No. X where the complaint was filed requiring herein petitioner San Miguel Corporation (Cagayan Coca-Cola Plant) "to pay the difference of whatever earnings and the amount actually received as 13th month pay excluding overtime premium and emergency cost of living allowance. "

Herein petitioner appealed from that Order to the Minister of Labor in whose behalf the Deputy Minister of Labor Amado G. Inciong issued an Order 4 dated June 7, 1978 affirming the Order of Regional Office No. X and dismissing the appeal for lack of merit. Petitioner's motion for reconsideration having been denied, it filed the instant petition. Issue: Whether in the computation of the 13th-month pay under Presidential Decree 851, payments for sick, vacation or maternity leaves, premium for work done on rest days and special holidays, including pay for regular holidays and night differentials should be considered. Held: No. The provision in dispute is Section 1 of Presidential Decree 851 and provides: All employers are hereby required to pay all their employees receiving a basic salary of not more than Pl,000 a month, regardless of the nature of the employment, a 13th-month pay not later than December 24 of every year. Section 2 of the Rules and Regulations for the implementation of Presidential Decree 851 provides: b) Basic salary shall include all remunerations on earnings paid by an employer to an employee for services rendered but may not include cost-of-living allowances granted pursuant to Presidential Decree No. 525 or Letter of Instructions No. 174, profit sharing payments and all allowances and monetary benefits which are not considered or integrated as part of the regular or basic salary of the employee at the time of the promulgation of the Decree on December 16, 1975. Under Presidential Decree 851 and its implementing rules, the basic salary of an employee is used as the basis in the determination of his 13th-month pay. Any compensations or remunerations which are deemed not part of the basic pay is excluded as basis in the computation of the mandatory bonus. Under a later set of Supplementary Rules and Regulations Implementing Presidential Decree 851 issued by the then Labor Secretary Blas Ople, overtime pay, earnings and other remunerations are excluded as part of the basic salary and in the computation of the 13th-month pay. The all-embracing phrase "earnings and other renumeration" which are deemed not part of the basic salary includes within its meaning payments for sick, vacation, or maternity leaves. Maternity premium for works performed on rest days and special holidays pays for regular holidays and night differentials. As such they are deemed not part of the basic salary and shall not be considered in the computation of the 13th-month they, were not so excluded, it is hard to find any "earnings and other remunerations" expressly excluded in the computation of the 13th-month pay. Then the exclusionary provision would prove to be Idle and with no purpose.

PHILIPPINE DUPLICATORS, INC. VS. NLRC G.R. NO. 110068 FEBRUARY 15, 1995 Facts: On 11 November 1993, this Court, through its Third Division, rendered a decision dismissing the petition for certiorari filed by petitioner Philippine Duplicators, Inc. (Duplicators) in G.R. No. 110068. The Court upheld the decision of public respondent National Labor Relations Commission (NLRC), which affirmed the order of Labor Arbiter Felipe T. Garduque II directing petitioner to pay 13th month pay to private respondent employees computed on the basis of their fixed wages plus sales commissions. The Third Division also denied with finality on 15 December 1993 the Motion for Reconsideration filed (on 12 December 1993) by petitioner. On 17 January 1994, petitioner Duplicators filed (a) a Motion for Leave to Admit Second Motion for Reconsideration and (b) a Second Motion for Reconsideration to set aside the rendered decision to them. Issue: Is the Motion for Leave to Admit Second Motion for Reconsideration and Second Motion for Reconsideration filed by the petitioner is valid and has a merit to set aside the rendered decision in Duplicators? Ruling: The Motions for Leave to File a Second Motion for Reconsideration and the aforesaid Second Reconsideration are denied by the court for lack of merit. ISALAMA MACHINE WORKS V NLRC ET AL G.R. NO. 100167 MARCH 2, 1995 Facts: On 25 March 1987, petitioner Isalama Machine Works Corporation and private respondent Isalama Machine Works Corporation Labor Union-Workers Alliance Trade Union entered into a collective bargaining agreement ("CBA") covering the period from 01 November 1986 to 03 October 1989. Following the signing of the CBA, the union made repeated demands on the corporation, allegedly to no avail, for it to comply with the CBA provisions. On 21 December 1987, the corporation paid the workers the 13th month pay based on the average number of days actually worked during the year. The union, through its president, private respondent Henry Baygan, demanded that the 13th month pay should, instead, be made on the basis of a full one month basic salary. The corporation countered that its own computation of the 13th month pay accorded with the CBA provisions and Presidential Decree No. 851. On 05 January 1988, the union filed a notice of strike with the Department of Labor and Employment, Region X, Cagayan de Oro, alleging the commission of unfair labor practice and CBA violation by the corporation. On 16 May 1988, the Executive Labor Arbiter rendered a decision holding the strike to be illegal and declaring Baygan and the

"participating" union members to have thereby lost their employment status. After several conferences, the National Conciliation and Mediation Board ("NCMB") succeeded in having the dispute amicably settled except for the 13th month pay differential which remained in contention. The union insisted that the failure of the corporation to implement fully the 13th month pay provision of the CBA amounted to unfair labor practice. Issue: Whether or not the workers should have a 13th month pay??? Held: Yes, In this case, the real reason for the strike is clearly traceable to the unresolved dispute between the parties on 13th month pay differentials under Presidential Decree No. 851, the proper manner of its application and computation. The Court does not see this issue, given the quoted provisions of the law and its implementing rules, to be constitutive of unfair labor practice. Section 9 of Rules and Regulations Implementing Presidential Decree No. 851, in fact, specifically states that "nonpayment of the thirteenth-month pay provided by the Decree and (the) rules shall be treated as money claims cases and shall be processed in accordance with the Rules Implementing the Labor Code of the Philippines and the Rules of the National Labor Relations Commission." Private respondents, indeed, showed little prudence, if at all, in their precipitate and illconsidered strike. The NLRC likewise found private respondents to have violated Art. 264 of the Labor Code when they blocked and barricaded the entrance of petitioner's premises preventing free ingress and egress. Unfortunately for petitioner, however, the identity of those who committed those illegal acts during the strike, except for Baygan, had not been adequately established. Specifically, the NLRC said that no sufficient evidence could be found "to pin down the afore-named 16 respondents as having committed illegal acts during the strike," that could warrant a loss of their employment status. The dismissal of Baygan, however, was warranted. Being the union president and leader of the strike, his liability was greater than that of mere members, and he had the responsibility to ensure that his followers respected the law. Article 248 of the Labor Code, in turn, provides: Unfair labor practices of employers. — It shall be unlawful for an employer to commit any of the following unfair labor practice: (i) To violate a collective bargaining agreement. This case arose in 1988 or prior to the effectivity of Republic Act No. 6715; accordingly, the back salaries of the dismissed employee should be limited to three years, without deduction or qualification, following the rule in Maranaw Hotels and Resorts Corporation vs. Court of Appeals. ALLIANCE OF GOVERNMENT WORKERS ET. AL. VS MINISTER OF LABOR AND EMPLOYMENT G.R. NO. L-60403 AUGUST 3, 1983 GUTIERREZ, JR. J.

FACTS: The Philippine Government Employees Association (PGEA) filed a motion pursuant to P.D. No. 851 in 1983. P.D. No. 851 requires all employers to pay 13th month pay to their employees with a single exception that is found in Sec. 2 which provides that employers who are already paying their employees 13th month pay or its equivalent are not covered by this Decree. It is contended by the petitioners that the Sec. 3 of the IRR of P.D. 851 also includes other types of employers who are not exempted by the decree. They aver that the secretary, now Minister of Labor and Employment, is not included in the decree or is not given authority by the decree to exempt from the requirement other types of employers. ISSUE: Whether or not the private sectors or of government-owned and controlled corporations and government agencies, are thereunder obligated to pay their employees, receiving a basic salary of not more than P1,000 a month, a 13thmonth pay not later than December 24th of every year? HELD: It is the legislature or, in proper cases, the administrative heads of government and not the collective bargaining process nor the concessions wrung by labor unions from management that determine how much the workers in governmentowned or controlled corporations may receive in terms of salaries, 13th month pay, and other conditions or terms of employment. There are government institutions, which can afford to pay two weeks, three weeks, or even 13th-month salaries to their personnel from their budgetary appropriations. Here as in other countries, government salaries and wages have always been lower than salaries, wages, and bonuses in the private sector. However, civil servants have no cause for despair. Service in the government may at times be a sacrifice but it is also a welcome privilege. Section 3 of the Rules and Regulations Implementing Presidential Decree No. 851 is, therefore, a correct interpretation of the decree. It has been implemented and enforced from December 22, 1975 to the present; the petitioners have shown no valid reason why it should be nullified because of their petition filed six and a half years after the issuance and implementation of the rule. WHEREFORE, the petition is hereby DISMISSED for lack of merit. TAN V.LAGRAMA G.R. NO. 151228 AUGUST 15, 2002 MENDOZA, J. Facts: Lagrama works for Tan as painter of billboards and murals for the motion pictures shown at the theaters managed by Tan for more than 10years. He was dismissed for having urinated in his working area. Aggrieved, Lagrama filed a complaint for illegal dismissal and non payment of benefits. Tan asserted that Lagrama was an independent contractor as he was paid in piece-work basis

Issue: Whether or not Lagrama is an independent contractor or an employee of Tan? Held: Lagrama is an employee, not an independent contractor Four Fold Test Power of Control - Evidence shows that the Lagrama performed his work as painter and under the supervision and control of Tan. Lagrama worked in a designated work area inside the theater of Tan for the use of which petitioner prescribed rules, which rules included the observance of cleanliness and hygeine and prohibition against urinating in the work area and any other place other than rest rooms and Tan's control over Lagrama's work extended not only the use of work area but also the result of Lagrama;s work and the manner and means by which the work was to be accomplished. Lagrama is not an independent contractor because he did not enjoy independence and freedom from the control and supervision of Tan and he was subjected to Tan's control over the means and methods by which his work is to be performed and accomplished Payment of Wages - Lagrama worked for Tan on a fixed piece work basis is of no moment. Payment by result is a method of compensation and does not define the essence of the relation. Tat Lagrama was not reported as an employee to the SSS is not conclusive, on the question whether he was an employee, otherwise Tan would be rewarded for his failure or even neglect to perform his obligation. Power of Dismissal– By Tan stating that he had the right to fire Lagrama, Tan in effect acknowledged Lagrama to be his employee Power of Selection and Engagement of Employees– Tan engaged the services of Lagrama without the intervention of third party. AVELINO LAMBO AND VICENTE BELOCURA VS. NLRC G.R. NO. 111042 OCTOBER 26, 1999 MENDOZA, J. Facts: Petitioners were employed as tailors by private respondents. They worked from 8AM to 7PM daily with a regular income of Php 64.00. Eventually, petitioners filed a complaint against private respondents for illegal dismissal. Petitioners sought to recover overtime pay, holiday pay, premium pay on holidays and rest days, service incentive leave pay, separation pay, 13th month pay, and attorney’s fees. Adter hearing the case, the Labor Arbiter decided in favor of the petitioners. However, upon appeal with NLRC, it was found out that petitioners were not actually dismissed but were threatened with a closure of the business if they insisted to demand their “straight payment of minimum wage.” Afterwards, the

petitioners walked-out from the meeting. Thus, NLRC set aside the Labor Arbiter’s decision and instead held the petitioners guilty of abandonment of work which resulted to the dismissal of the said monetary claims. Issue: Are petitioners entitled to the monetary claims and benefits? Ruling: Yes. The Court finds merit in the contentions of the petitioners that they were illegally dismissed and, therefore, should be entitled to all the monetary benefits that they are claiming for. Such decision is based on the following grounds: There is an existing employer-employee relationship between the two parties because of the capacity of the private respondents to control the employee’s work conduct. It is established that the petitioners were required to regularly report for work within the premises on the private-respondent’s establishment at a specific schedule for more than a year. Due to the establishment of the employer-employee relationship, and that it was further seen that the employees were illegally dismissed, it is just right to award them the said pays. Therefore, the Court decided in favor of the petitioners and affirmed the Labor Arbiter’s decision with the exception of including the attorney’s fees in the computation. MAKATI HABERDASHERY VS NLRC G.R. NO. 83380-81 NOVEMBER 15, 1989 FACTS: Petition for certiorari to review the decision of the NLRC which affirmed the decision of the Labor Arbiter who jointly heard and decided two cases filed by the Union in behalf of the private respondents. Individual complainants are working for Makati Haberdashery Inc as tailors, seamstress, sewers, basters, and “plantsadoras” and are paid on a piece-rate basis (except two petitionerswho are paid on a monthly basis)• In addition, they are given a daily allowance of P 3.00 provided they report before 9:30 a.m.everyday. Work schedule: 9:30-6 or 7 p.m., Mondays to Saturdays and even on Sundays and holidays during peak periods. The Sandigan ng Manggagawang Pilipino filed a complaint for underpayment of the basic wages, underpayment of living allowance, nonpayment of overtime work, nonpayment of holiday pay, and other money claims. The Labor Arbiter rendered judgment in favor of complainants which the NLRC affirmed but limited back wages to one year. Petitioner urged that the NLRC erred in concluding that an employer-employee relationship existed between the petitioner and the workers. Issue: 1. WON employees paid on piece-rate basis are entitled to service incentive pay? WON there is an Employer-Employee Relationship?

Held: No, fall under exceptions set forth in the implementing rules (this will be reexamined under Article 101). Yes, evident in a Memorandum issued by the Assistant Manager. Ratio: As to the service incentive leave pay: as piece-rate workers being paid at a fixed amount for performing work irrespective of time consumed in the performance thereof, they fall under the exceptions stated in Sec1(d), Rule V, IRR, Book III, Labor Code. Service Incentive Leave SECTION 1. Coverage. — This rule shall apply to all employees except:(d) Field personnel and other employees whose performance is unsupervised by the employer including those who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective of the time consumed in the performance thereof; Employer-Employee Relationship. There is such relationship because in the application of the four-fold test, it was found that petitioners had control over the respondents not only as to the result but also as to the means and method by which the same is to be accomplished. LABOR CONGRESS OF THE PHILIPPINES (LCP) VS. NLRC AND EMPIRE FOOD PRODUCTS G.R. NO. 123938 MAY 21, 1998 DAVIDE, JR., J. In this special civil action for certiorari under Rule 65, petitioners seek to reverse the 29 March 1995 resolution 1of the National Labor Relations Commission (NLRC) in NLRC RAB III Case No. 01-1964-91 which affirmed the Decision 2 of Labor Arbiter Ariel C. Santos dismissing their complaint for utter lack of merit. FACTS: The 99 persons named as petitioners in this proceeding were rank-and-file employees of respondent Empire Food Products, which hired them on various dates (Paragraph 1, Annex "A" of Petition, Annex "B;" Page 2, Annex "F" of Petition). Petitioners filed against private respondents a complaint for payment of money claim[s] and for violation of labor standard[s] laws (NLRC Case No. RAB-111-101817-90). They also filed a petition for direct certification of petitioner Labor Congress of the Philippines as their bargaining representative (Case No. R03009010-RU-005). On October 23, 1990, petitioners represented by LCP President Benigno B. Navarro, Sr. and private respondents Gonzalo Kehyeng and Evelyn Kehyeng in behalf of Empire Food Products, Inc. entered into a Memorandum of Agreement which provided, among others, the following:

That in connection with the pending Petition for Direct Certification filed by the Labor Congress with the DOLE, Management of the Empire Food Products has no objection [to] the direct certification of the LCP Labor Congress and is now recognizing the Labor Congress of the Philippines (LCP) and its Local Chapter as the SOLE and EXCLUSIVE Bargaining Agent and Representative for all rank and file employees of the Empire Food Products regarding "WAGES, HOURS Of WORK, AND OTHER TERMS AND CONDITIONS OF EMPLOYMENT;" That with regards [sic] to NLRC CASE NO. RAB-III-10-1817-90 pending with the NLRC parties jointly and mutually agreed that the issues thereof, shall be discussed by the parties and resolve[d] during the negotiation of the Collective Bargaining Agreement; That Management of the Empire Food Products shall make the proper adjustment of the Employees Wages within fifteen (15) days from the signing of this Agreement and further agreed to register all the employees with the SSS; That Employer, Empire Food Products thru its Management agreed to deduct thru payroll deduction UNION DUES and other Assessment[s] upon submission by the LCP Labor Congress individual Check-Off Authorization[s] signed by the Union Members indicating the amount to be deducted and further agreed all deduction[s] made representing Union Dues and Assessment[s] shall be remitted immediately to the LCP Labor Congress Treasurer or authorized representative within three (3) or five (5) days upon deductions [sic], Union dues not deducted during the period due, shall be refunded or reimbursed by the Employer/Management. Employer/Management further agreed to deduct Union dues from non-union members the same amount deducted from union members without need of individual Check-Off Authorizations [for] Agency Fee; That in consideration [of] the foregoing covenant, parties jointly and mutually agreed that NLRC CASE NO. RAB-III-10-1817-90 shall be considered provisionally withdrawn from the Calendar of the National Labor Relations Commission (NLRC), while the Petition for direct certification of the LCP Labor Congress parties jointly move for the direct certification of the LCP Labor Congress; That parties jointly and mutually agreed that upon signing of this Agreement, no Harassments [sic], Threats, Interferences [sic] of their respective rights under the law, no Vengeance or Revenge by each partner nor any act of ULP which might disrupt the operations of the business; Parties jointly and mutually agreed that pending negotiations or formalization of the propose[d] CBA, this Memorandum of Agreement shall govern the parties in the exercise of their respective rights involving the Management of the business and the terms and condition[s] of employment, and whatever problems and grievances may arise by and between the parties shall be resolved by them, thru the most cordial and good harmonious relationship by communicating the other party in writing indicating said grievances before taking any action to another forum or government agencies; That parties [to] this Memorandum of Agreement jointly and mutually agreed to respect, abide and comply with all the terms and conditions hereof. Further agreed that violation by the parties of any provision herein shall constitute an act of ULP. (Annex "A" of Petition).

In an Order dated October 24, 1990, Mediator Arbiter Antonio Cortez approved the memorandum of agreement and certified LCP "as the sole and exclusive bargaining agent among the rank-and-file employee of Empire Food Products for purposes of collective bargaining with respect to wages, hours of work and other terms and conditions of employment" (Annex "B" of Petition). On November 9, 1990, petitioners through LCP President Navarro submitted to private respondents a proposal for collective bargaining (Annex "C" of Petition). On January 23, 1991, petitioners filed a complaint docketed as NLRC Case No. RAB-III-01-1964-91 against private respondents for:  Unfair Labor Practice by way of Illegal Lockout and/or Dismissal;  Union busting thru Harassments [sic], threats, and interfering with the rights of employees to self-organization;  Violation of the Memorandum of Agreement dated October 23, 1990;  Underpayment of Wages in violation of R.A. No. 6640 and R.A. No. 6727, such as Wages promulgated by the Regional Wage Board;  Actual, Moral and Exemplary Damages. (Annex "D" of Petition) After the submission by the parties of their respective position papers and presentation of testimonial evidence, Labor Arbiter Ariel C. Santos absolved private respondents of the charges of unfair labor practice, union busting, violation of the memorandum of agreement, underpayment of wages and denied petitioners' prayer for actual, moral and exemplary damages. Labor Arbiter Santos, however, directed the reinstatement of the individual complainants: The undersigned Labor Arbiter is not oblivious to the fact that respondents have violated a cardinal rule in every establishment that a payroll and other papers evidencing hours of work, payments, etc. shall always be maintained and subjected to inspection and visitation by personnel of the Department of Labor and Employment. As such penalty, respondents should not escape liability for this technicality, hence, it is proper that all individual complainants except those who resigned and executed quitclaim[s] and releases prior to the filing of this complaint should be reinstated to their former position[s] with the admonition to respondents that any harassment, intimidation, coercion or any form of threat as a result of this immediately executory reinstatement shall be dealt with accordingly. SO ORDERED. (Annex "G" of petition) On appeal, the National Labor Relations Commission vacated the Decision dated April 14, 1972 [sic] and remanded the case to the Labor Arbiter for further proceedings for the following reasons: The Labor Arbiter, through his decision, noted that ". . . complainant did not present any single witness while respondent presented four (4) witnesses in the

persons of Gonzalo Kehyeng, Orlando Cairo, Evelyn Kehyeng and Elvira Bulagan . . ." (p. 183, Records), that ". . . complainant before the National Labor Relations Commission must prove with definiteness and clarity the offense charged. . . ." (Record, p. 183); that ". . . complainant failed to specify under what provision of the Labor Code particularly Art. 248 did respondents violate so as to constitute unfair labor practice . . ." (Record, p. 183); that "complainants failed to present any witness who may describe in what manner respondents have committed unfair labor practice . . ." (Record, p. 185); that ". . . complainant LCP failed to present anyone of the so-called 99 complainants in order to testify who committed the threats and intimidation . . ." (Record, p. 185). Upon review of the minutes of the proceedings on record, however, it appears that complainant presented witnesses, namely, BENIGNO NAVARRO, JR. (28 February 1991, RECORD, p. 91; 8 March 1991, RECORD, p. 92, who adopted its POSITION PAPER AND CONSOLIDATED AFFIDAVIT, as Exhibit "A" and the annexes thereto as Exhibit "B", "B-1" to "B-9", inclusive. Minutes of the proceedings on record show that complainant further presented other witnesses, namely: ERLINDA BASILIO (13 March 1991, RECORD, p. 93; LOURDES PANTILLO, MARIFE PINLAC, LENIE GARCIA (16 April 1991, Record, p. 96, see back portion thereof ; 2 May 1991, Record, p. 102; 16 May 1991, Record, p. 103, 11 June 1991, Record, p. 105). Formal offer of Documentary and Testimonial Evidence was made by complainant on June 24, 1991 (Record, p. 106-109) The Labor Arbiter must have overlooked the testimonies of some of the individual complainants which are now on record. Other individual complainants should have been summoned with the end in view of receiving their testimonies. The complainants should be afforded the time and opportunity to fully substantiate their claims against the respondents. Judgment should be rendered only based on the conflicting positions of the parties. The Labor Arbiter is called upon to consider and pass upon the issues of fact and law raised by the parties. Toward this end, therefore, it is Our considered view [that] the case should be remanded to the Labor Arbiter of origin for further proceedings. (Annex "H" of Petition) In a Decision dated July 27, 1994, Labor Arbiter Santos made the following determination: Complainants failed to present with definiteness and clarity the particular act or acts constitutive of unfair labor practice. It is to be borne in mind that a declaration of unfair labor practice connotes a finding of prima facieevidence of probability that a criminal offense may have been committed so as to warrant the filing of a criminal information before the regular court. Hence, evidence which is more than a scintilla is required in order to declare respondents/employers guilty of unfair labor practice. Failing in this regard is fatal to the cause of complainants. Besides, even the charge of illegal lockout has no leg to stand on because of the testimony of respondents through

their guard Orlando Cairo (TSN, July 31, 1991 hearing; p. 5-35) that on January 21, 1991, complainants refused and failed to report for work, hence guilty of abandoning their post without permission from respondents. As a result of complainants['] failure to report for work, the cheese curls ready for repacking were all spoiled to the prejudice of respondents. Under cross-examination, complainants failed to rebut the authenticity of respondents' witness testimony. As regards the issue of harassments [sic], threats and interference with the rights of employees to self-organization which is actually an ingredient of unfair labor practice, complainants failed to specify what type of threats or intimidation was committed and who committed the same. What are the acts or utterances constitutive of harassments [sic] being complained of? These are the specifics which should have been proven with definiteness and clarity by complainants who chose to rely heavily on its position paper through generalizations to prove their case. Insofar as violation of [the] Memorandum of Agreement dated October 23, 1990 is concerned, both parties agreed that: 2 — That with regards [sic] to the NLRC Case No. RAB III-10-1817-90 pending with the NLRC, parties jointly and mutually agreed that the issues thereof shall be discussed by the parties and resolve[d] during the negotiation of the CBA. The aforequoted provision does not speak of [an] obligation on the part of respondents but on a resolutory condition that may occur or may not happen. This cannot be made the basis of an imposition of an obligation over which the National Labor Relations Commission has exclusive jurisdiction thereof. Anent the charge that there was underpayment of wages, the evidence points to the contrary. The enumeration of complainants' wages in their consolidated Affidavits of merit and position paper which implies underpayment has no leg to stand on in the light of the fact that complainants' admission that they are piece workers or paid on a pakiao [basis] i.e. a certain amount for every thousand pieces of cheese curls or other products repacked. The only limitation for piece workers or pakiao workers is that they should receive compensation no less than the minimum wage for an eight (8) hour work [sic]. And compliance therewith was satisfactorily explained by respondent Gonzalo Kehyeng in his testimony (TSN, p. 12-30) during the July 31, 1991 hearing. On cross-examination, complainants failed to rebut or deny Gonzalo Kehyeng's testimony that complainants have been even receiving more than the minimum wage for an average workers [sic]. Certainly, a lazy worker earns less than the minimum wage but the same cannot be attributable to respondents but to the lazy workers. Finally, the claim for moral and exemplary damages has no leg to stand on when no malice, bad faith or fraud was ever proven to have been perpetuated by respondents. WHEREFORE, premises considered, the complaint is hereby DISMISSED for utter lack of merit. (Annex "I" of Petition). 4

On appeal, the NLRC, in its Resolution dated 29 March 1995, 5 affirmed in toto the decision of Labor Arbiter Santos. In so doing, the NLRC sustained the Labor Arbiter's findings that: (a) there was a dearth of evidence to prove the existence of unfair labor practice and union busting on the part of private respondents; (b) the agreement of 23 October 1990 could not be made the basis of an obligation within the ambit of the NLRC's jurisdiction, as the provisions thereof, particularly Section 2, spoke of a resolutory condition which could or could not happen; (c) the claims for underpayment of wages were without basis as complainants were admittedly"pakiao" workers and paid on the basis of their output subject to the lone limitation that the payment conformed to the minimum wage rate for an eight-hour workday; and (d) petitioners were not underpaid. Their motion for reconsideration having been denied by the NLRC in its Resolution of 31 October 1995, 6petitioners filed the instant special civil action for certiorari. ISSUES: 1 Whether or not the petitioners have been illegally dismissed by private respondents. Whether or not the petitioners are entitled to full back wages and other privileges, and separation pay in lieu of reinstatement. HELD: 1 Private respondents, moreover, in considering petitioners' employment to have been terminated by abandonment, violated their rights to security of tenure and constitutional right to due process in not even serving them with a written notice of such termination. 12 Section 2, Rule XIV, Book V of the Omnibus Rules Implementing the Labor Code provides: Sec. 2. Notice of Dismissal — Any employer who seeks to dismiss a worker shall furnish him a written notice stating the particular acts or omission constituting the grounds for his dismissal. In cases of abandonment of work, the notice shall be served at the worker's last known address. 2 Petitioners are therefore entitled to reinstatement with full back wages pursuant to Article 279 of the Labor Code, as amended by R.A. No. 6715. Nevertheless, the records disclose that taking into account the number of employees involved, the length of time that has lapsed since their dismissal, and the perceptible resentment and enmity between petitioners and private respondents which necessarily strained their relationship, reinstatement would be impractical and hardly promotive of the best interests of the parties. In lieu of reinstatement then, separation pay at the rate of one month for every year of service, with a fraction of at least six (6) months of service considered as one (1) year, is in order. 13

That being said, the amount of back wages to which each petitioner is entitled, however, cannot be fully settled at this time. Petitioners, as piece-rate workers having been paid by the piece, 14 there is need to determine the varying degrees of production and days worked by each worker. Clearly, this issue is best left to the National Labor Relations Commission. As to the other benefits, namely, holiday pay, premium pay, 13th month pay and service incentive leave which the labor arbiter failed to rule on but which petitioners prayed for in their complaint, 15 we hold that petitioners are so entitled to these benefits. Three (3) factors lead us to conclude that petitioners, although piece-rate workers, were regular employees of private respondents. First, as to the nature of petitioners' tasks, their job of repacking snack food was necessary or desirable in the usual business of private respondents, who were engaged in the manufacture and selling of such food products; second, petitioners worked for private respondents throughout the year, their employment not having been dependent on a specific project or season; and third, the length of time 16that petitioners worked for private respondents. Thus, while petitioners' mode of compensation was on a "per piece basis," the status and nature of their employment was that of regular employees. The Rules Implementing the Labor Code exclude certain employees from receiving benefits such as nighttime pay, holiday pay, service incentive leave 17 and 13th month pay, 18 inter alia, "field personnel and other employees whose time and performance is unsupervised by the employer, including those who are engaged on task or contract basis, purely commission basis, or those who are paid a fixed amount for performing work irrespective of the time consumed in the performance thereof." Plainly, petitioners as piece-rate workers do not fall within this group. As mentioned earlier, not only did petitioners labor under the control of private respondents as their employer, likewise did petitioners toil throughout the year with the fulfillment of their quota as supposed basis for compensation. Further, in Section 8 (b), Rule IV, Book III which we quote hereunder, piece workers are specifically mentioned as being entitled to holiday pay. Sec. 8. Holiday pay of certain employees. — Where a covered employee is paid by results or output, such as payment on piece work, his holiday pay shall not be less than his average daily earnings for the last seven (7) actual working days preceding the regular holiday: Provided, however, that in no case shall the holiday pay be less than the applicable statutory minimum wage rate. In addition, the Revised Guidelines on the Implementation of the 13th Month Pay Law, in view of the modifications to P.D. No. 851 19 by Memorandum Order No. 28, clearly exclude the employer of piece rate workers from those exempted from paying 13th month pay, to wit: EXEMPTED EMPLOYERS The following employers are still not covered by P.D. No. 851:

d. Employers of those who are paid on purely commission, boundary or task basis, and those who are paid a fixed amount for performing specific work, irrespective of the time consumed in the performance thereof, except where the workers are paid on piece-rate basis in which case the employer shall grant the required 13th month pay to such workers. (emphasis supplied) The Revised Guidelines as well as the Rules and Regulations identify those workers who fall under the piece-rate category as those who are paid a standard amount for every piece or unit of work produced that is more or less regularly replicated, without regard to the time spent in producing the same. 20 As to overtime pay, the rules, however, are different. According to Sec. 2(e), Rule I, Book III of the Implementing Rules, workers who are paid by results including those who are paid on piece-work, takay, pakiao, or task basis, if their output rates are in accordance with the standards prescribed under Sec. 8, Rule VII, Book III, of these regulations, or where such rates have been fixed by the Secretary of Labor in accordance with the aforesaid section, are not entitled to receive overtime pay. Here, private respondents did not allege adherence to the standards set forth in Sec. 8 nor with the rates prescribed by the Secretary of Labor. As such, petitioners are beyond the ambit of exempted persons and are therefore entitled to overtime pay. Once more, the National Labor Relations Commission would be in a better position to determine the exact amounts owed petitioners, if any. JIMENEZ ET. AL. V. NLRC AND JUANATAS G.R. NO. 116960 APRIL 2, 1996 Facts: On June 29, 1990, private respondents Pedro and Fredelito Juanatas, father and son, filed aclaim for unpaid wages/commissions, separation pay and damages against JJ's Trucking and/or Dr. Bernardo Jimenez. Said respondents, as complainants therein, alleged that in December,1987, they were hired by herein petitioner Bernardo Jimenez as driver/mechanic and helper,respectively, in his trucking firm, JJ Trucking. They were assigned to a ten-wheeler truck to haulsoft drinks of Coca-Cola Bottling Company and paid on commission basis, initially fixed at 17%but later increased to 20% in 1988. Private respondents further alleged that for the years 1988 and 1989 they received only a partialcommission of P84,000.00 from petitioners' total gross income of almost P1,000,000.00 for thesaid two years. Consequently, with their commission for that period being computed at 20% of said income, there was an unpaid balance to them of P106,211.86; that until March, 1990 whentheir services were illegally terminated, they were further entitled to P8,050.00 which added upto a grand total of P114,261.86 due and payable to them.

Disputing the complaint, petitioners contend that respondent Fredelito Juanatas was not anemployee of the firm but was merely a helper of his father Pedro; that all commissions for 1988and 1989, as well as those up to March, 1990, were duly paid; and that the truck driven byrespondent Pedro Juanatas was sold to one Winston Flores in 1991 and, therefore, privaterespondents were not illegally dismissed. After hearings duly conducted, and with the submission of the parties' position/supportingpapers, Labor Arbiter Rogue B. de Guzman rendered a decision ordering respondents JJ'sTrucking and/or Dr. Bernardo Jimenez to pay jointly and severally complainant Pedro Juanatasa separation pay of P15,050.00, plus attorney's fee equivalent to 10% of the award. Thecomplaint of Fredelito Juanatas is hereby dismissed for lack of merit.On appeal filed by private respondents, the NLRC modified the decision of the labor arbiter declaring Fredelito Juanatas as respondents' employee and shares in the commission andseparation pay awarded to complainant Pedro Juanatas, his father. Further, respondent JJ'sTrucking and Dr. Bernardo Jimenez are jointly and severally liable to pay complainants their unpaid commissions in the total amount of P84,387.05. Hence, this petition for certiorari, seeking the annulment of the decision of respondent NLRCdenying petitioners' motion for reconsideration. Issue: Whether or not respondent NLRC committed grave abuse of discretion in ruling (a) that private respondents were not paid their commissions in full, and (b) that respondent Fredelito Juanatas was an employee of JJ's Trucking. Ruling: On the first issue, there is no reason to disturb the findings of respondent NLRC that the entire amount of commissions was not paid, because of the evident failure of petitioners to present evidence that full payment thereof has been made. As a general rule, one who pleads payment has the burden of proving it. Even where the plaintiff (herein private respondent) must allege non-payment, the burden of evidence rests on the defendant (herein petitioners) to prove payment, rather than on the plaintiff to prove non-payment. In the instant case, the right of respondent Pedro Juanatas to be paid a commission equivalent to 17%, later increased to 20%, of the gross income is not disputed by petitioners. Although private respondents admit receipt of partial payment, petitioners still have to present proof of full payment. The testimony of petitioners which merely denied the claim of private respondents, unsupported by documentary evidence, is not sufficient to establish payment. Although petitioners submitted a notebook showing the alleged vales of private respondents for the year 1990, the same is inadmissible and cannot be

given probative value considering that it is not properly accomplished, is undated and unsigned, and is thus uncertain as to its origin and authenticity. Hence, for failure to present evidence to prove payment, petitioners defaulted in their defenseand in effect admitted the allegations of private respondents.With respect to the second issue, NLRC erred in holding that the son, Fredelito, was an employee of petitioners. In the case at bar, the elements of an employer-employee relationship, are not present. The agreement was between petitioner JJ's Trucking and respondent Pedro Juanatas. The hiring of a helper was discretionary on the part of Pedro. Hence, Fredelito was not an employee of petitioners. WHEREFORE, the judgment of respondent National Labor Relations Commission is AFFIRMED, with the MODIFICATION that declaring Fredelito Juanatas is not an employee of petitioners and not entitled to share in the award for commission and separation pay. VIRGINIA G. NERI VS. NLRC 224 SCRA 717 JULY 23, 1993 FACTS: Petitioners instituted complaints against FEBTC and BCC to compel the bank to accept them as regular employeesand for it to pay the differential between the wages being paid them by BCC and those received by FEBTC employeeswith similar length of service. They contended that BCC in engaged in labor-only contracting because it failed toadduce evidence purporting to show that it invested in the form of tools, equipment, machineries, work premisesand other materials which are necessary in the conduct of its business. Moreover, petitioners argue that they performduties which are directly related to the principal business or operation of FEBTC. ISSUE: Whether or not BCC was engaged in labor-only contracting. HELD: It is well-settled that there is labor-only contracting where: (a) the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others; and, (b) the workers recruited and placed by such person are performing activities which are directly related o the principal business of the employer.BCC need not prove that it made investments in the form of tools, equipment, machineries, work premises, among others, because it has established that it has sufficient capitalization. This fact was both determined by the Labor Arbiter and the NLRC as BCC had a capital stock of P1 million fully subscribed and paid for. BCC is therefore a highly capitalized venture and cannot be deemed engaged in labor-only contracting.

While there may be no evidence that it has investment in the form of tools, equipment, machineries, work premises, among others, it is enough that it has substantial capital, as was established before the Labor Arbiter as well as the NLRC. The law does not require both substantial capital and investment in the form of tools, equipment, machineries, etc. This is clear from the use of the conjunction "or" instead of ‚and‛. Having established that it has substantial capital, it was no longer necessary for BCC to further adduce evidence to prove that it does not fall within the purview of "labor-only" contracting. There is even no need for it to refute petitioners' contention that the activities they perform are directly related to the principal business of respondent bank. On the other hand, the Court has already taken judicial notice of the general practice adopted in several government and private institutions and industries of hiring independent contractors to perform special services. These services range from janitorial, security and even technical or other specific services such as those performed by petitioners Neri and Cabelin. While these services may be considered directly related to the principal business of the employer, nevertheless, they are not necessary in the conduct of the principal business of the employer. MANILA WATER COMPANY, INC. VS. PENA G.R. NO. 158255 JULY 8, 2004 FACTS Petitioner Manila Water Company, Inc. is one of the two private concessionaires contracted by the Metropolitan Waterworks and Sewerage System (MWSS) to manage the water distribution system in the East Zone of Metro Manila, pursuant to Republic Act No. 8041, otherwise known as the National Water Crisis Act of 1995. Under the Concession Agreement, petitioner undertook to absorb former employees of the MWSS whose names and positions were in the list furnished by the latter, while the employment of those not in the list was terminated on the day petitioner took over the operation of the East Zone, which was on August 1, 1997. Private respondents, being contractual collectors of the MWSS, were among the 121 employees not included in the list; nevertheless, petitioner engaged their services without written contract from August 1, 1997 to August 31, 1997. Thereafter, on September 1, 1997, they signed a three-month contract to perform collection services for eight branches of petitioner in the East Zone. Before the end of the three-month contract, the 121 collectors incorporated the Association Collectors Group, Inc. (ACGI), which was contracted by petitioner to collect charges for the Balara Branch. Subsequently, most of the 121 collectors were asked by the petitioner to transfer to the First Classic Courier Services, a newly registered corporation. Only private respondents herein remained with ACGI. Petitioner continued to transact with ACGI to do its collection needs until February 8, 1999, when petitioner terminated its contract with ACGI.

Private respondents filed a complaint for illegal dismissal and money claims against petitioner, contending that they were petitioner’s employees as all the methods and procedures of their collections were controlled by the latter. On the other hand, petitioner asserts that private respondents were employees of ACGI, an independent contractor. It maintained that it had no control and supervision over private respondents’ manner of performing their work except as to the results. Thus, petitioner did not have an employer-employee relationship with the private respondents, but only a service contractor-client relationship with ACGI. ISSUE Whether or not there exists an employer-employee relationship between petitioner and private respondents. RULING We agree with the Labor Arbiter that ACGI was not an independent contractor. First, ACGI does not have substantial capitalization or investment in the form of tools, equipment, machineries, work premises, and other materials, to qualify as an independent contractor. While it has an authorized capital stock of P1,000,000.00, only P62,500.00 is actually paid-in, which cannot be considered substantial capitalization. The 121 collectors subscribed to four shares each and paid only the amount of P625.00 in order to comply with the incorporation requirements. Further, private respondents reported daily to the branch office of the petitioner because ACGI has no office or work premises. In fact, the corporate address of ACGI was the residence of its president, Mr. Herminio D. Peña. Moreover, in dealing with the consumers, private respondents used the receipts and identification cards issued by petitioner. Second, the work of the private respondents was directly related to the principal business or operation of the petitioner. Lastly, ACGI did not carry on an independent business or undertake the performance of its service contract according to its own manner and method, free from the control and supervision of its principal, petitioner. Prior to private respondents’ alleged employment with ACGI, they were already working for petitioner, subject to its rules and regulations in regard to the manner and method of performing their tasks. This form of control and supervision never changed although they were already under the seeming employ of ACGI. These are indications that ACGI was not left alone in the supervision and control of its alleged employees. Consequently, it can be concluded that ACGI was not an independent contractor since it did not carry a distinct business free from the control and supervision of petitioner. Under this factual milieu, there is no doubt that ACGI was engaged in labor-only contracting, and as such, is considered merely an agent of the petitioner. In labor-only contracting, the statute creates an employer-employee relationship for a comprehensive purpose: to prevent a circumvention of labor laws. The contractor is considered merely an agent of the principal employer and the latter is responsible to the employees of the labor-only contractor as if such employees had been directly employed by the principal employer. Since ACGI is only a

labor-only contractor, the workers it supplied should be considered as employees of the petitioner. SAN MIGUEL CORPORATION V. PROSPERO ABALLA G.R. NO. 149011 JUNE 28, 2005 CARPIO-MORALES,J Facts: Petitioner San Miguel Corporation (SMC) and Sunflower Multi-Purpose Cooperative(Sunflower) entered into a one-year Contract of Service and such contract is renewed on amonthly basis until terminated. Pursuant to this, respondent Prospero Aballa rendered servicesto SMC.After one year of service, Aballa filed a complaint before NLRC praying that they be declared asregular employees of SMC. On the other hand, SMC filed before the DOLE a Notice of Closuredue to serious business losses. Hence, the labor arbiter dismissed the complaint and ruled infavor of SMC. Aballa then appealed before the NLRC. The NLRC dismissed the appeal findingthat Sunflower is an independent contractor.On appeal, the Court of Appeals reversed NLRC·s decision on the ground that the agreementbetween SMC and Sunflower showed a clear intent to abstain from establishing an employer-employee relationship. Issue: Whether or not Aballa and other employees of Sunflower are employees of SMC? Held: The test to determine the existence of independent contractorship is whether oneclaiming to be an independent contractor has contracted to do the work according to his ownmethods and without being subject to the control of the employer, except only as to the resultsof the work. In legitimate labor contracting, the law creates an employer-employee relationshipfor a limited purpose, to ensure that the employees are paid their wages. The principal employer becomes jointly and severally liable with the job contractor, only for the payment of theemployees wages whenever the contractor fails to pay the same. Other than that, the principalemployer is not responsible for any claim made by the employees. In labor-only contracting, thestatute creates an employeremployee relationship for a comprehensive purpose: to prevent acircumvention of labor laws. The contractor is considered merely an agent of the principalemployer and the latter is responsible to the employees of the labor-only contractor as if suchemployees had been directly employed by the principal employer.The Contract of Services between SMC and Sunflower shows that the parties clearly disavowedthe existence of an employer-employee relationship between SMC and private respondents.The language of a contract is not, however, determinative of the parties· relationship; rather it isthe totality of the facts and surrounding circumstances of the case. A party cannot dictate, bythe mere expedient of a unilateral declaration in a contract, the character of its business,whether as labor-only contractor or job contractor, it being crucial that

its character be measuredin terms of and determined by the criteria set by statute. What appears is that Sunflower doesnot have substantial capitalization or investment in the form of tools, equipment, machineries,work premises and other materials to qualify it as an independent contractor. On the other hand,it is gathered that the lot, building, machineries and all other working tools utilized by Aballa etal. in carrying out their tasks were owned and provided by SMC.And from the job description provided by SMC itself, the work assigned to Aballa et al. wasdirectly related to the aquaculture operations of SMC. As for janitorial and m essengerialservices, that they are considered directly related to the principal business of the employer hasbeen jurisprudentially recognized. Furthermore, Sunflower did not carry on an independent business or undertake the performance of its service contract according to its own manner andmethod, free from the control and supervision of its principal, SMC, its apparent role havingbeen merely to recruit persons to work for SMC.All the foregoing considerations affirm by more than substantial evidence the existence of anemployer- employee relationship between SMC and Aballa. Since Aballa who were engaged inshrimp processing performed tasks usually necessary or desirable in the aquaculture businessof SMC, they should be deemed regular employees of the latter and as such are entitled to allthe benefits and rights appurtenant to regular employment. They should thus be awardeddifferential pay corresponding to the difference between the wages and benefits given them andthose accorded SMC·s other regular employee TABAS VS. CALIFORNIA MANUFACTURING CO. GR NO. 80680 JANUARY 26, 1989 SARMIENTO, J. Facts: Petitioners filed a petition in the NLRC for reinstatement and payment of various benefits against California Manufacturing Company. The respondent company then denied the existence of an employer-employee relationship between the company and the petitioners. Pursuant to a manpower supply agreement, it appears that the petitioners prior their involvement with California Manufacturing Company were employees of Livi Manpower service, an independent contractor, which assigned them to work as “promotional merchandisers.” The agreement provides that: California has no control or supervisions whatsoever over Livi's workers with respect to how they accomplish their work or perform, Californias obligation” It was further expressly stipulated that the assignment of workers to California shall be on a “seasonal and contractual basis” that cost of living allowance and the 10 legal holidays will be charged directly to California at cost and that payroll for the preceding week shall be delivered by Livi at California's premises.” Issue: Whether principal employer is liable.

Held: Yes. The existence of an employer-employee relation cannot be made the subject of an agreement. Based on Article 106, “labor-only” contractor is considered merely as an agent of the employer, and the liability must be shouldered by either one or shared by both. There is no doubt that in the case at bar, Livi performs “manpower services”, meaning to say, it contracts out labor in favor of clients. We hold that it is one notwithstanding its vehement claims to the contrary, and notwithstanding the provision of the contract that it is “an independent contractor.” The nature of one’s business is not determined by self-serving appellations one attaches thereto but by the tests provided by statute and prevailing case law. The bare fact that Livi maintains a separate line of business does not extinguish the equal fact that it has provided California with workers to pursue the latter’s own business. In this connection, we do not agree that the petitioners had been made to perform activities ‘which are not directly related to the general business of manufacturing,” California’s purported “principal operation activity.” Livi, as a placement agency, had simply supplied California with the manpower necessary to carry out its California merchandising activities, using its California premises and equipment. MAFINCO TRADING CORP. VS. OPLE G.R. NO. L-37790 MARCH 25, 1976 AQUINO, J. FACTS: Cosmos Aerated Water Factory, a firm based at Malabon, Rizal, appointed petitioner Mafinco as its sole distributor of Cosmos soft drinks in Manila. Rodrigo Repomanta and Mafinco executed a peddling contract whereby Repomanta agreed to buy and sell Cosmos soft drinks. Rey Moralde entered into a similar contract. Months later, Mafinco terminated the peddling contract with Repomanta and Moralde. Consequently, Repomanta and Moralde, through their union, filed a complaint with the NLRC, charging the general manager of Mafinco for illegally dismissing them.4.Mafinco filed a motion to dismiss the complaint on the ground that the NLRC had no jurisdiction because Repomanta and Moralde were not its employees but were independent contractors. It stressed that there was termination of the contract not a dismissal of an employee. ISSUE: Whether or not there exist an employer-employee relationship between petitioner Mafinco and private respondents Repomanta and Moralde. HELD:

The Supreme Court held that under the peddling contracts, Repomanta and Moralde were not employees of Mafinco but were independent contractors as found by the NLC and its fact finder and by the committee appointed by the Secretary of Labor to look into the status of Cosmos and Mafinco peddlers. A contract whereby one engages to purchase and sell soft drinks on trucks supplied by the manufacturer but providing that the other party (peddler) shall have the right to employ his own workers, shall post a bond to protect the manufacturer against losses, shall be responsible for damages caused to third persons, shall obtain the necessary licenses and permits and bear the expenses incurred in the sale of the soft drinks is not a contract of employment. INSULAR LIFE INSURANCE CO. LTD VS NLRC G.R. NO. 84484 NOVEMBER 15, 1989 NARVASA, J. FACTS: Insular Life (company) and Basiao entered into a contract by which Basiao was authorized to solicit forinsurance in accordance with the rules of the company. He would also receive compensation, in the form of commissions. The contract also contained the relations of the parties, duties of the agent and the acts prohibited tohim including the modes of termination.After 4 years, the parties entered into another contract – an Agency Manager’s Contact – and to implementhis end of it, Basiao organized an agency while concurrently fulfilling his commitment under the first contract. The company terminated the Agency Manager’s Contract. Basiao sued the company in a civil action. Thus,the company terminated Basiao’s engagement under the first contract and stopped payment of his commissions. ISSUE: W/N Basiao had become the company’s employee by virtue of the contract, thereby placing his claim forunpaid commissions HELD: No.Rules and regulations governing the conduct of the business are provided for in the Insurance Code. Theserules merely serve as guidelines towards the achievement of the mutually desired result without dictating themeans or methods to be employed in attaining it. Its aim is only to promote the result, thereby creating noemployer-employee relationship. It is usual and expected for an insurance company to promulgate a set of rules toguide its commission agents in selling its policies which prescribe the qualifications of persons who may be insured.None of these really invades the agent’s contractual prerogative to adopt his own selling methods or to sellinsurance at his own time and convenience, hence cannot justifiable be said to establish an employer-employeerelationship between Basiao and the company. The respondents limit themselves to pointing out that Basiao’s contract with the company bound him toobserve and conform to such rules. No showing that such rules were in fact promulgated which

effectivelycontrolled or restricted his choice of methods of selling insurance. Therefore, Basiao was not an employee of the petitioner, but a commission agent, an independent contractwhose claim for unpaid commissions should have been litigated in an ordinary civil action.Wherefore, the complain of Basiao is dismissed. RHONE-POULENC AGROCHEMICALS PHILIPPINES, INC. VS. NLRC G.R. NOS. 102633-35 JANUARY 19, 1993 FACTS The petitioner is a domestic corporation engaged in the manufacture of agrochemicals. Its business operations involve the formulation, production, distributionand sale in the local market of its agro-chemical products.On January 1, 1988, as a consequence of the sale by Union Carbide, Inc. of all itsagriculturalchemical divisions worldwide in favor of Rhone-Poulenc Agrochemie,France, the petitioner's mother corporation, the petitioner acquired from UnionCarbide Philippines Far East, Inc. the latter's agro-chemical formulation plant inNamayan, Mandaluyong, Metro Manila.In 1987, prior to the sale, Union Carbide had entered into a contract with CSI for thelatter's supply of janitorial services. During the transition period, Union Carbidecontinued to avail itself of CSI's janitorial services. Thus, petitioner Rhone-Poulencfound itself sharing the Namayan plant with Union Carbide while the factory wasbeing serviced and maintained by janitors supplied by CSI.Midway through the transition period, Union Carbide instructed CSI to reduce thenumber of janitors working at the plant from eight (8) to seven (7).Private respondent Paulino Roman, one of the janitors, was recalled by CSI onFebruary 15, l988 for reassignment. However, Roman refused to acknowledgereceipt of the recall memorandum.On March 9, 1988, Union Carbide formally notified CSI of the termination of their janitorial service agreement, effective April 1, 1988, citing as reason the global buy-out by Rhone-Poulenc, Agrochemie, France of Union Carbides Inc.'s agrochemicalbusiness.CSI thereafter issued a memorandum dated March 20, 1988 to the seven remaining janitors assigned to the Namayan plant, including respondent Urcisio Orain, recallingand advising them to report to the CSI office for reassignment. Like Roman, the janitors refused to acknowledge receipt of the recall memorandum.Meanwhile, in anticipation of the March 31, 1988 pull-out by Union Carbide, thepetitioner started screening proposals by prospective service contractors. Rhone-Poulenc likewise invited CSI to submit to its Bidding Committee a cost quotation ofits janitorial services. However, another contractor, the Marilag Business andIndustrial Services, Inc. passed the bidding committee's standards and obtained the janitorial services contract.On April 1, 1988, the eight janitors reported for work at the Namayan plant but wererefused admission and were told that another group of janitors had replaced them.These janitors then filed separate complaints for illegal dismissal, payment of 13thmonth salary, service leave and overtime pay against Union Carbide, Rhone-Poulenc and CSI.

ISSUES 1.Whether or not the janitors were employees of Union Carbide 2.Whether or not the CSI is a labor only contractor 3.Whether or not petitioner absorbed the janitors in its workforce RULING The court held that the petition is meritorious. In determining the existence of employer-employee relationship, the following elements are generally considered, namely: (1) the selection and engagement of employees (2) the payment of wages; (3) the power of dismissal; and (4) the power to control the employee's conduct — although the latter is the most important element. There is no employer-employee relationship between Union Carbide and the respondent janitors. The respondents themselves admitted that they were selected and hired by CSI and were assigned to Union Carbide. CSI likewise acknowledged that the two janitors were its employees. The janitors drew their salaries from CSI and not from Union Carbide. CSI exercised control over these janitors through Richard Barroga, also a CSI employee, who gave orders and instructions to CSI janitors assigned to the Namayan ESCARIO ET.AL. VS. NLRC G.R. NO. 124055 JUNE 8, 2000 J.GUTTIERREZ, JR. Facts: Petitioners are merchandisers of respondent company. They withdraw stocks from the warehouse, fix the prices, price-tagging, displaying the products and inventory. They were paid by the company through an agent to avoid liability. They claim that they were under the control and supervision of the company. They asked for regularization of their status. They were then given notice of their termination. The company denied any employer-employee relationship. They claim that they used an agent or independent contractors to sell the merchandise. The Labor Arbiter ruled that there was an employer-employee relationship. The NLRC set aside the decision and said that there was no such relationship. The agent was a legitimate independent contractor. Issue: Whether or not the petitioners are employees of the company. Held: The Court ruled that there is no employer-employee relationship and that petitioners are employees of the agent. The agent is a legitimate independent contractor. Labor-only contractor occurs only when the contractor merely recruits, supplies or places workers to perform a job for a principal. The laboronly contractor doesn’t have substantial capital or investment and the workers recruited perform activities

directly related to the principal business of the employer. There is permissible contracting only when the contractor carries an independent business and undertakes the contract in his own manner and method, free from the control of the principal and the contractor has substantial capital or investment. The agent ,and not the company, also exercises control over the petitioners. No documents were submitted to prove that the company exercised control over them. The agent hired the petitioners. The agent also pays the petitioners, no evidence was submitted showing that it was the company paying them and not the agent. It was also the agent who terminated their services. By petitioning for regularization, the petitioners concede that they are not regular employees. RADIO COMMUNICATION OF THE PHILIPPINES INC. VS. SECRETARY OF LABOR G.R. NO. 77959 JANUARY 9, 1989 Facts: On May 4, 1981, petitioner, a domestic corporation engaged in the telecommunications business, filed with the National Wages Council an application for exemption from the coverage of Wage Order No. 1. The application was opposed by respondent United RCPI Communications Labor Association (URCPICLA-FUR), a labor organization affiliated with the Federation of Unions of Rizal (FUR). On May 22, 1981, the National Wages Council disapproved saidapplication and ordered petitioner to pay its covered employees the mandatory living allowance of P2.00 daily effective March 22, 1981. As early as March 13, 1985, before the aforesaid case was elevated to this Court, respondent union filed a motion for the issuance of a writ of execution, asserting therein its claim to 15% of the total backpay due to all its members as "union service fee" for having successfully prosecuted the latter's claim for payment of wages and for reimbursement of expenses incurred by FUR and prayed for the segregation and remittance of said amount to FUR thru its NationalPresident. On October 24, 1985, without the knowledge and consent of respondent union, petitioner entered into a compromise agreementwith Buklod ng Manggagawa sa RCPI-NFL (BMRCPI-NFL) as the new bargaining agent of oppositors RCPI employees. Thereupon, the parties filed a joint motion praying for the dismissal of the decision of the National Wages Council for it had already been novated by the Compromise Agreement re-defining the rights and obligations of the parties. Respondent Union on November 7, 1985, countered by opposing the motion and alleging that one of the signatories thereof - BMRCPI-NFL is not a party in interest in the case but that it was respondent Union which represented oppositors RCPI employees all the way from the level of the National Wages Council up the Supreme Court. Respondent Union, therefore, claimed that

the Compromise Agreement is irregular and invalid, apart from the fact that there was nothing to compromise in the face of a final and executory decision. Director Severo M. Pucan issued an Order dated November 25, 1985 awarding to URCPICLA-FUR and FUR 15% of the total backpay of RCPI employees as their union service fees, and directing RCPI to deposit said amount with the cashier of the Regional Office for proper disposition to said awardees. Despite said order, petitioner paid in full the covered employees on November 29, 1985, without deducting the union service fee of 15%. In an order dated May 7, 1986, NCR officer-in-charge found petitioner RCPI and its employees jointly and severally liable for the payment of the 15% union service fee amounting to P427,845.60 to private respondent URCPICLA-FUR and consequently ordered the garnishment of petitioner's bank account to enforce said claim. Secretary of Labor and Employment issued an order on August 18, 1986 modifying the order appealed from by holding petitioner solely liable to respondent union for 10% of the awarded amounts as attorney's fees. Issue: Whether or not public respondents acted with grave abuse of discretion amounting to lack of jurisdiction in holding the petitioner solely liable for "union service fee” to respondent URCPICLA-FUR. Held: No. Attorney's fee due the oppositor is chargeable against RCPI. The defaulting employer or government agency remains liable for attorney's fees because it compelled the complainant to employ the services of counsel by unjustly refusing to recognize the validity of the claim. (Cristobal vs. ECC) It is undisputed that oppositor (private respondent herein) was the counsel on record of the RCPI employees in their claim for EC0LA under Wage Order No. 1 since the inception of the proceedings at the National Wages Council up to the Supreme Court. It had, therefore, a valid claim for attorney's fee which it called union service fee. As is evident in the compromise agreement, petitioner was bound to pay only 30% of the amount due each employee on November 30, 1985, while the balance of 70% would still be the subject of renegotiation by the parties. Yet, despite such conditions beneficial to it, petitioner paid in full the backpay of its employees on November 29, 1985, ignoring the service fee due the private respondent. Worse, petitioner supposedly paid to one Atty. Rodolfo M. Capocyan the 10% fee that properly pertained to herein private respondent, an unjustified and baffling diversion of funds. Finally, petitioner cannot invoke the lack of an individual written authorization from the employees as a shield for its fraudulent refusal to pay the service fee of private respondent. Be that as it may, the lack thereof was remedied and supplied by the execution of thecompromise agreement whereby the employees, expressly approved the 10% deduction and held petitioner RCPI free from any claim, suit or

complaint arising from the deduction thereof. When petitioner was thereafter again ordered to pay the 10% fees to respondent union, it no longer had any legal basis or subterfuge for refusing to pay the latter. We agree that the Labor Code in requiring an individual written authorization as a prerequisite to wage deductions seeks to protect the employee against unwarranted practices that would diminish his compensation without his knowledge and consent. However, for all intents and purposes, the deductions required of the petitioner and the employees do not run counter to the express mandate of the law since the same are not unwarranted or without their knowledge and consent. Also, the deductions for the union service fee in question are authorized by law and do not require individual check-off authorizations

APODACA VS. NLRC G.R. NO. 80039 APRIL 18, 1989 FACTS: Petitioner was employed in respondent corporation. He was persuaded by respondent Mirasol to subscribe to 1,500 shares or for a total of P150,000.00. He paid P37,500.00. On September 1, 1975, petitioner was appointed President and General Manager of the respondent corporation. However, on January 2, 1986, he resigned. Petitioner instituted with the NLRC a complaint against private respondents for the payment of his unpaid wages, his cost of living allowance, the balance of his gasoline and representation expenses and his bonus compensation for 1986. Private respondents admitted that there is due to petitioner the amount of P17,060.07 but this was applied to the unpaid balance of his subscription in the amount of P95,439.93. Petitioner questioned the set-off alleging that there was no call or notice for the payment of the unpaid subscription and that, accordingly, the alleged obligation is not enforceable. ISSUES: Whether or not NLRC has jurisdiction to resolve a claim for nonpayment of stock subscriptions to a corporation. (2) If so, whether or not an obligation arising there from be offset against a money claim of an employee against the employer. RULING: NLRC has no jurisdiction to determine such intra-corporate disputebetween the stockholder and the corporation as in the matter of unpaidsu bscriptions. This controversy is within the exclusive jurisdiction of the Securities and Exchange Commission.(2) No. the unpaid subscriptions are not due and payable until a call is made by the corporation for payment. Private respondents have not presented a resolution of the board of directors of Respondent Corporation calling for the payment of the unpaid subscriptions. It does not even

appear that a notice of such call has been sent to petitioner by the respondent corporation. As there was no notice or call for the payment of unpaid subscriptions, the same is not yet due and payable. Even if there was a call for payment, the NLRC cannot validly set it off against the wages and other benefits due petitioner. Article 113 of the Labor Code allows such adeduction from the wages of the employees by the employer, only in threeinstan ces NATIONAL FEDERATION OF LABOR VS. NLRC G.R. NO. 103586 JULY 21, 1994 Facts: Several Wage Orders were promulgated by the then President Ferdinand E. Marcos. This allegedly resulted to a wage distortion between the regular and the casual employees. Grievance meetings were held by petitioner National Federation of Labor ("NFL") and private respondent Company addressing the impact which implementation of the various Wage Orders had on the wage structure of the Company. On 21 June 1984, all the casual or non-regular employees of private respondent Company (at least in its Davao Plant) were "regularized," or converted into regular employees, pursuant to the request of petitioner NFL. On 1 July 1984, the effectivity date of the 1984 Collective Bargaining Agreement between NFL and the Company, all regular employees of the Company received an increase of P1.84 in their daily wage; the regular daily wage of the regular employees thus became P35.84 as against P34.00 per day for non-regular employees. As a result of the implementation of Wage Order No. 6, casual employees received an increase of their daily wage from P34.00 to P36.00. At the same time, the Company unilaterally granted an across-the-board increase of P2.00 in the daily rate of all regular employees, thus increasing their daily wage from P35.84 to P37.84. Further, on 1 July 1985, the anniversary date of the increases under the CBA, all regular employees who were members of the collective bargaining unit got a raise of P1.76 in their basic daily wage, which pushed that daily wage from P37.84 to P39.60, as against the non-regular's basic wage of P36.00 per day. Finally, by November 1987, the lowest paid regular employee had a basic daily rate of P64.64, or P10.64 more than the statutory minimum wage paid to a non-regular employee. On 11 November 1987, the NLRC En Banc rendered a decision which in effect found the existence of wage distortion and required the Company to pay a P1.00 wage increase effective 1 May 1984. In the computation submitted by the Union, there is a need to restore the P2.56 gap between non-regulars or "casuals" and "regular workers." This difference in the basic wage of these workers was existing at the time of the conclusion of the collective bargaining agreement and before the implementation of Wage Orders No. 4 & 5. The imprecise claim of respondent that there is P3.60 gap between non-regular and regulars may not be sustained because as aforestated, this amount represents negotiated wage increase which should not be considered covered and in compliance with the wage orders. Considering, however, the present economic conditions and the outlay involved in correcting the distortion in the wages of respondent's workers, this Commission, in the

exercise of its arbitral powers, feels that an increase of P1.00 on the present basic wage of regular workers would significantly rectify or minimize the distortion in the wage structure of respondent company caused by the implementation of the various wage orders. Respondent is, therefore, required to implement the P1.00 wage increase effective May 1, 1984 when Wage Order 4 took effect. On motion for partial reconsideration filed by the Company, the above quoted portion of the NLRC En Banc'sdecision was reconsidered and set aside by the NLRC Fifth Division. 3 The Fifth Division of the NLRC in effect found that while a wage distortion did exist commencing 16 June 1984, the distortion persisted only for a total of fifteen (15) days and accordingly required private respondent company to pay "a wage increase of P2.00 per day to all regular workers effective June 16, 1984 up to June 30, 1984 or a total of fifteen (15) days." 4 The rest of the decision of 11 November 1987 was left untouched. Issue: Whether there existed a wage distortion Held: Yes. As used in Article 124 of the Labor Code, a wage distortion shall mean a situation where an increase in prescribed wage rates results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical bases of differentiation. The concept of wage distortion assumes an existing grouping or classification of employees which establishes distinctions among such employees on some relevant or legitimate basis. This classification is reflected in a differing wage rate for each of the existing classes of employees. The wage distortion anticipated in Wage Orders Nos. 3, 4, 5 and 6 was a "distortion" (or "compression") which ensued from the impact of those Wage Orders upon the different wage rates of the several classes of employees. Thus distortion ensued where the result of implementation of one or another of the several Wage Orders was the total elimination or the severe reduction of the differential or gap existing between the wage rates of the differing classes of employees. There did exist a two-fold classification of employees within the private respondent Company: regular employees on the one hand and casual (or non-regular) employees on the other. As can be seen from the figures referred to earlier, the differential between these two (2) classes of employees existing before Wage Order No. 3 was reduced to zero upon the effectivity of Wage Order No. 5 on 16 June 1984. Obviously, distortion — consisting of complete elimination of the wage rate differential — had occurred. It is equally clear, however, that fifteen (15) days later, on 1 July 1984, upon effectivity of the wage increase stipulated in the collective bargaining agreement between the parties, a gap or differential of P1.84 was re-created. This restored differential persisted after the effectivity of Wage Order No. 6 on 1 November 1984. By operation of the same CBA, by 1 July 1985, the wage differential had grown to P3.60. MANILA MANDARIN EMPLOYEES UNION VS. NLRC

GR 108556 NOVEMBER 19, 1996 FACTS: The union filed with the NLRC arbitration branch a complaint on wage distortion. The labor arbiter ruled in favor of the Union while the NRLC Commissioner Zapanta reversed the same. The Union contends that the Mandarin Hotel filed its appeal three days beyond the prescribed period. ISSUES: Whether or not NLRC acquired jurisdiction to take cognizance of Mandarin’s appeal from Labor Arbiter . RULING: The Court ruled that the Commission acted correctly in accepting and acting on Mandarin’s appeal. The employee who was authorized to receive payment was not around so the respondent was allowed to pay docketing fee on the next business day which was February 4, 1991. In view of the considerations and in the interest of justice was quite served when Mandarin’s appeal was given due course despite delayed payment of fees the reglamentary period confers a directory, not a mandatory, power to dismiss an appeal. CAGAYAN SUGAR MILLING CO., V SECRETARY OF LABOR ET AL., G.R. NO. 128399 JANUARY 15, 1998 Facts: On November 16, 1993, Regional Wage Order No. RO2-02 was issued by the Regional Tripartite Wage and Productivity Board, Regional Office No. II of the Department of Labor and Employment (DOLE). It provided, inter alia, that: Sec. 1. Upon effectivity of this Wage Order, the statutory minimum wage rates applicable to workers and employees in the private sector in Region II shall be increased as follows: P 14.00 per day . . . Cagayan. On September 12 and 13, 1994, labor inspectors from the DOLE Regional Office examined the books of petitioner to determine its compliance with the wage order. They found that petitioner violated the wage order as it did not implement an across the board increase in the salary of its employees. Issue: Whether or not the petitioner violates the Wage Oder that mandates the increase of minimum wage, and Regional Wage Order No. RO2-02 is valid, and violates Article 123 of the Labor Code? Held: No, Article 123 of the Labor Code provides: Wage Order. - Whenever conditions in the region so warrant, the Regional Board shall investigate and study all pertinent facts, and, based on the standards and criteria herein prescribed, shall proceed to determine whether a Wage Order should be issued. Any such Wage Order shall take effect after (15) days from its complete

publication in at least one (1) newspaper of general circulation in the region. In the performance of its wage-determining functions, the Regional Board shall conduct public hearings/consultations giving notices to employees' and employers' groups and other interested parties. In sum, we hold that RO2-02-A is invalid for lack of public consultations and hearings and non-publication in a newspaper of general circulation, in violation of Article 123 of the Labor Code. We likewise find that public respondent Secretary of Labor committed grave abuse of discretion in upholding the findings of Regional Director Ricardo S. Martinez, Sr. that petitioner violated Wage Order RO2-02. Decision of the Secretary of Labor, dated October 8, 1996, is set aside for lack of merit. ECOP VS. NWPC G.R. NO. 96169 SEPTEMBER 24, 1991 J. SARMIENTO FACTS: Petitioners ECOP questioned the validity of the wage order issued by the RTWPB dated October 23, 1990 pursuant to the authority granted by RA 6727. The wage order increased the minimum wage by P17.00 daily in the National Capital Region. The wage order is applied to all workers and employees in the private sector of an increase of P 17.00 including those who are paid above the statutory wage rate. ECOP appealed with the NWPC but dismissed the petition. The Solicitor General in its comment posits that the Board upon the issuance of the wage order fixed minimum wages according to the salary method. Petitioners insist that the power of RTWPB was delegated, through RA 6727, to grant minimum wage adjustments and in the absence of authority, it can only adjust floor wages. ISSUE: Whether or not the wage order issues by RTWPB dated October 23, 1990 is valid. HELD: The Court agrees with the Solicitor General. It noted that there are two ways in the determination of wage, these are floor wage method and salary ceiling method. The floor wage method involves the fixing of determinate amount that would be added to the prevailing statutory minimum wage while the salary ceiling method involves where the wage adjustment is applied to employees receiving a certain denominated salary ceiling. RA 6727 gave statutory standards for fixing the minimum wage. The Commission noted that the increasing trend is toward the salary-cap method, which has reduced disputes arising from wage distortions (brought about,

apparently, by the floor-wage method). Precisely, Republic Act No. 6727 was intended to rationalize wages, first, by providing for full-time boards to police wages round-the-clock, and second, by giving the boards enough powers to achieve this objective. The Court is of the opinion that Congress meant the boards to be creative in resolving the annual question of wages without labor and management knocking on the legislature's door at every turn. The petition is DENIED. MEYCAUAYAN COLLEGE V. DRILON G.R. NO. 81122 MAY 7, 1990 Facts: Petitioner is a private educational institution operating in Meycauayan, Bulacan. On January 16, 1987, its board of trustees recognized the Meycauayan College Faculty and Personnel Association as the employees' union in the Meycauayan College. Prior to said recognition or on July 17, 1983, petitioner and the union, then headed by Mrs. Teresita V. Lim, entered into a collective bargaining agreement for 1983-1986. Article IV thereof provided the salary scale for teachers. Later on the union discovered that provisions of said article were not implemented. Consequently, on March 27, 1987, the union filed with the Department of Labor and Employment, Regional Office No. III in San Fernando, Pampanga, a notice of strike on the ground of unfair labor practice. Petitioner's contention is that an agreement on a salary scale should be distinguished from an agreement on a salary increase. Thus, it argues in fine that an agreement on a salary scale should be considered as an addition to the salary increase imposed by law and viceversa. Issue: Whether or not increases in employees' salaries resulting from the implementation of presidential decrees and wage orders, which are over and above the agreed salary scale contracted for between the employer and the employees in a collective bargaining agreement, preclude the employees from claiming the difference between their old salaries and those provided for under said salary scale. Held: Increments to the laborers’ financial gratification, be they in the form of salary increases or changes in the salary scale are aimed at one thing - improvement of the economic predicament of the laborers. As such they should be viewed in the light of the States avowed policy to protect labor. Thus, having entered into an agreement with its employees, an employer may not be allowed to renege on its obligation under a collective bargaining agreement should, at the same time, the law grant the employees the same or better terms and conditions of employment. Employee benefits derived from law are exclusive of benefits arrived at through negotiation and agreement unless otherwise provided by the agreement itself or by law.

The one-year prescriptive period is inapplicable in this case because of peculiar factual circumstances which petitioner has not denied. Although the collective bargaining agreement covers school years 1983 to 1986, a copy of the agreement was only made available to the union in 1987. Immediately thereafter, the union sought its implementation. The union members might have been aware of the existence of the collective bargaining agreement but that fact that their president was actually a management employee being petitioner's registrar, they must have been deterred from demanding its implementation earlier. Hence, to apply the provisions of Article 290 (Art. 291) would be unfair and prejudicial to the union members particularly those who have served petitioner for a number of years who stand to benefit most from the salary scale. ST. JOSEPH’S COLLEGE VS. ST. JOSEPH’S COLLEGE WORKERS’ ASSOCIATION (SAMAHAN) G.R. NO. 155609 JANUARY 9, 2005 Facts: Petitioner and respondent has discrepancies in computing the incremental proceeds of the tuition fee that is to be used for the payment in payment of personnel benefits. Respondent’s figures are higher than that of the petitioner’s. The discrepancy was due to the differences in the income received by the school in the previous year and the present year. Petitioner avers that the base figure for computing the previous year’s income should be based on the previous school year’s number of enrollees. Further, petitioner defends that it could not give the amount computed by the respondent because for them the school has not gained income but losses caused by the drop in the enrollment rate. On the other hand, respondents contend that petitioner’s computations would result in to a sharp reduction of incremental proceeds. Thus, a small share of the proceeds shall be given to the respondents. Eventually, this leads both parties to undergo voluntary arbitration. The Voluntary Arbiters decided in favor of the respondents and ordered the petitioner to pay the respondents back wages, allowance and other benefits retroactively. The Court of Appeals likewise sided with the petitioners. Issue: Whether or not the petitioner’s computations of incremental proceeds are with merit and in accordance with the law? Ruling: No, the Court ruled in accordance with Section 5(2) of Republic Act 6728 which allows tuition fee increases in private school given that 70% of the said increase should be disbursed as salaries, wages, allowances, and other benefits for the teaching and non-teaching personnel. Thus, despite the petitioner’s contention that it could not grant the computation of the respondent due to losses, the former should comply with this said rule. The Court could not change what the

legislature has laid down. Moreover, as to the contention of the school that it has incurred losses, the petitioner has failed to actually show the actual losses it has suffered. Therefore, the Court denies the petition and affirms the decisions rendered by the lower courts. COCOFED ET. AL., VS. HON. CRESENCIANO B. TRAJANO G.R. NO. 982767 FEBRUARY 15, 1995 ROMERO, J. FACTS: Philippine Coconut Producers Federation operates petitioner COCOFED (Kalamansig), a coconut plantation utilized as a demonstration farm for replanting and/or training area for coconut farmers, located in Kalamansig, Sultan Kudarat. On November 15, 1988, a complaint inspection was conducted by the Department of Labor and Employment, Region XII, Cotabato City in response to complaints filed by two of petitioner's employees, Alex Edicto and Delia Pahuwayan. The inspection revealed that petitioner was guilty of underpayment of wages, emergency cost of living allowance (ECOLA) and 13th month pay. Accordingly, notice of inspection results was issued: requiring petitioner to effect restitution or correction within five (5) days from notice. Summary Petitioner submitted its position paper claiming that it should be classified as an establishment with less than 30 employees and with a paid-up capital of P500,000.00 or less as evidenced by the assessment of the municipal treasurer. Moreover, complainants worked for less than eight hours, a minimum of four and maximum of six. . . . A three (3) year actual payrolls from March 1985 to February 1989 showing the daily actual payment made by the respondent to involved workers are substantial evidence against the mere memorandum issued by the respondents on the matter. Further, such payrolls submitted by respondents are not mere summaries of daily efforts of workers but these are daily records showing workers actual daily rate. ISSUE: Whether or not the petitioner was justified in paying an amount less than the statutory minimum wage. HELD: Petitioner would have us overturn the factual finding of public respondents that its employees are daily paid workers. This we are unable to do for the payrolls submitted by it support the latters' position. Findings of administrative agencies which have acquired expertise because their jurisdiction is confined to specific matters are generally accorded not only respect but finality. Moreover, there is absolutely nothing in the records which show that petitioner's employees worked for less than eight hours. Finally, there would have been no need for petitioner to make an offer increasing the wage to P45.00 per day if

complainants were indeed piece rate workers, as it claimed and if their wages were not underpaid, as found by public respondents. WHEREFORE, the petition is DISMISSED ODIN SECURITY AGENCY V. HON. DIONISIO DELA SERNA ET. AL, G.R. NO. 87439 FEB. 21, 1990 Facts: The private respondents (employees) filed with the DOLE a complaint charging the petitioner (employer) with underpayment of wages, illegal deductions, non payment of night shift differential, overtime pay, etc. When conciliation efforts failed, the parties were required to submit their position papers. Based on the position papers, the Regional Director issued an order directing the employer to pay the employees the benefits prayed for. Claiming that he was denied due process, the petitioner filed a motion for reconsideration which was treated as an appeal. The Undersecretary affirmed with modification the order of the Regional Director. Hence, this petition for certiorari and prohibition Ruling: Requirement of the process is satisfied when the parties are given an opportunity to submit position papers; what the fundamental law abhors is not absence of previous notice but the absolute lack of opportunity to be heard. – The petitioner was not denied due process, for several hearings were in fact conducted by the hearing officer of the Regional Office of the DOLE and the parties submitted position papers upon which the Regional Director based his decision in the case. The requirements of due process are satisfied when the parties are given an opportunity to submit position papers. Principle of jurisdiction by estoppel. – The petitioner is estopped from questioning the alleged lack of jurisdiction of the Regional Director over the private respondents’ claims. Petitioner submitted to the jurisdiction of the Regional Director by taking part in the hearings before him and by submitting a position paper. This act of participation amounts to estoppel, [that is, action speaks louder than words: the law does not allow a person to speak against his own act or deed.] URBANES, JR. VS. SEC. OF LABOR GR NO. 122791 FEBRUARY 19, 2003 FACTS: Petitioner Placido O. Urbanes, Jr., doing business under the name and style of Catalina Security Agency, entered into an agreement to provide security services to respondent Social Security System (SSS). During the effectivity of the

agreement, petitioner, by letter of May 16, 1994, requested the SSS for the upward adjustment of their contract rate in view of Wage Order No. NCR-03 which was issued by the Regional Tripartite Wages and Productivity Board-NCR pursuant to Republic Act 6727 otherwise known as the Wage Rationalization Act .On June 24, 1994, petitioner pulled out his agency's services from the premises of the SSS and another security agency, Jaguar, took over. On June 29, 1994, petitioner filed a complaint with the DOLE-NCR against the SSS seeking the implementation of Wage Order No. NCR-03.The Regional Director of the DOLE-NCR rendered judgment in favor of the petitioner. SSS appealed to the Secretary of Labor. The Secretary of Labor set aside the order of the Regional Director and the Secretary held petitioner's security agency "JOINTLY AND SEVERALLY liable for wage differentials, the amount of which should be paid DIRECTLY to the security guards concerned. ISSUE: Whether or not the Secretary of Labor have jurisdiction to review appeals from decisions of the Regional Directors in complaints filed under Article 129 of the Labor Code. RULING: In the case at bar, even if petitioner filed the complaint on his and also on behalf of the security guards, the relief sought has to do with the enforcement of the contract between him and the SSS which was deemed amended by virtue of Wage Order No. NCR-03. The controversy subject of the case at bar is thus a civil dispute, the proper forum for the resolution of which is the civil courts. But even assuming arguendo that petitioner's complaints were filed with the proper forum, for lack of cause of action it must be dismissed. Articles 106, 107 and 109 of the Labor Code provide: ART. 106. CONTRACTOR OR SUBCONTRACTOR. — Whenever an employer enters into contract with another person for the performance of the former's work, the employees of the contractor and of the latter's subcontractor, if any, shall be paid in accordance with the provisions of this Code. In the event that the contractor or subcontractor fails to pay the wage of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him. xxx xxx xxx (Emphasis and underscoring) ART. 107.INDIRECT EMPLOYER. — The provisions of the immediately preceding Article shall likewise apply to any person, partnership, association or corporation which, not being an employer, contracts with an independent contractor for the performance of any work, task, job or project. ART. 109.SOLIDARY LIABILITY. — The provisions of existing laws to the contrary notwithstanding, every employer or indirect employer shall be held responsible with his contractor or subcontractor for any violation of any provision of this Code. For purposes of determining the extent of their civil liability under this Chapter, they shall be considered as direct employers. In fine,

the liability of the SSS to reimburse petitioner arises only if and when petitioner pays his employee-security guards "the increases" mandated by Wage Order No. NCR-03. The records do not show that petitioner has paid the mandated increases to the security guards. The security guards in fact have filed a complaint with the NLRC against petitioner relative to, among other things, underpayment of wages. VICENTE ATILANO/ROSE SHIPPING LINES VS. DE LA SERNA G.R. NO. 82488 FEBRUARY 28, 1990 FACTS On 20 May 1985, private respondents filed a letter-complaint in the Regional Office of the then Ministry of Labor and Employment, Cebu City, against petitioner Rose Shipping Lines and its Proprietor/Manager Vicente Atilano docketed as LSED Case No. 055-85. The letter-complaint alleged violations by petitioner of labor standard laws on minimum wages, allowances, 13th month pay and overtime pay. Acting on the letter-complaint, the Office of the Regional Director ordered a Labor Standards and Welfare Officer (LSW officer, hereinafter) to conduct a complaint inspection on 22 July 1985 at the establishment of petitioner in Cebu City. Several conciliation conferences on the motion to dismiss were subsequently held and both parties agreed that they would submit their respective position papers after which petitioner's motion to dismiss would be deemed submitted for resolution. On 24 April 1986, public respondent Regional Director denied petitioner's motion to amiss for lack of merit. A motion for reconsideration or appeal was filed with the Secretary of the Department of Labor and Employment on 19 May 1986. Petitioner more than a year later filed a Manifestation and Motion with the Secretary dated 23 July 1987, enclosing therein a different set of quitclaims and/or a also prepared by petitioner but allegedly signed by private respondents dated 9 July 1986 (i.e., different from those earlier referred to by petitioner in his ex-partemotion to dismiss filed with the Regional Director On 3 March 1988, public respondent Under of Labor rendered the questioned order dismissing petitioner's motion for reconsideration or appeal for lack of merit.

ISSUE Whether or not the public respondents, Regional Director and Undersecretary of Labor, have jurisdiction over the subject matter of the case. RULING

We do not find petitioner's argument persuasive. We believe that the question of the authenticity or genuineness of the quitclaims, releases and waivers supposedly signed by private respondents, but vehemently denied by the latter, could be verified by the Regional Director in the course of, and in connection with, examination of the petitioner's books and records of which such supposed quitclaims, etc. (if at all genuine) must have fanned part. We note also that after petitioner on 19 May 1986 filed a motion for reconsideration or appeal from the Regional Director's order of 16 January 1986, with the Secretary of Labor, the Secretary of Labor requested the Regional Director to conduct conferences or hearings for the purpose of verifying the genuineness and authenticity of private respondents' signatures on the quitclaim papers submitted by petitioner.The quitclaim papers which petitioner alleges embodied a compromise or settlement agreement were in any case not duly executed, that is, they were not signed in the presence of the Regional Director or his duly authorized representative, in disregard of the requirements of Section 8, Rule II of the Rules on the Disposition of Labor Standards Cases in the Regional Offices. We note that petitioner did not submit any rebuttal evidence before the Regional Director or his representatives. Thus, the lack of inspection was cured when the Regional Director called the parties to several conferences, at which conferences, petitioner could have presented whatever he had in his books and records to refute the claims of private respondents; petitioner did not do so and his failure must be deemed a waiver of his right to contest the conclusions of the Regional Director on the basis of the evidence and records actually made available to him. BROKENSHIRE MEMORIAL HOSPITAL VS. HON. MINISTER OF LABOR AND EMPLOYMENT G.R. NO. 74621 FEBRUARY 7, 1990 PARAS, J. Facts: This case originated from a complaint filed by private respondents against petitioner on September 21, 1984 with the Regional Office of the MOLE, Region XI, Davao City for non-compliance with the provisions of Wage Order No. 5. After due healing the Regional Director rendered a decision dated November 16, 1984 in favor of private respondents. Judgment having become final and executory, the Regional Director issued a Writ of Execution whereby some movable properties of the hospital (petitioner herein) were levied upon and its operating expenses kept with the bank were garnished. The levy and garnishment were lifted when petitioner hospital paid the claim of the private respondents (281 hospital employees) directly, in the total amount of P163,047.50 covering the period from June 16 to October 15, 1984. After making said payment, petitioner hospital failed to continue to comply with Wage Order No. 5 and likewise, failed to comply with the new Wage Order No. 6 which took effect on November 1, 1984, prompting private respondents to file against petitioner another complaint docketed as ROXI-LSED-14-85, which is now the case at bar.

Issue: Whether the Regional Director has jurisdiction over money claims of workers concurrent with the Labor Arbiter. Held: Regional Director has no jurisdiction over workers' money claims, the Court in the three (3) cases above-mentioned ruled that in view of the promulgation of Executive Order No. 111, the ruling in the earlier case of Zambales Base Metals is already abandoned. In accordance with the rulings in Briad Agro, L.M. Camus, and Maternity Children's Hospital, the Regional Director exercises concurrent jurisdiction with the Labor Arbiter over money claims. Thus, Executive Order No. 111 is in the character of a curative law, that is to say, it was intended to remedy a defect that, in the opinion of the legislative (the incumbent Chief Executive in this case, in the exercise of her lawmaking power under the Freedom Constitution) had attached to the provision subject of the amendment. This is clear from the proviso: "The provisions of Article 217 to the contrary notwithstanding . . ." Plainly, the amendment was meant to make both the Secretary of Labor (or the various Regional Directors) and the Labor Arbiter share jurisdiction. RA 6715 amended Art. 129 and Art. 217 of the Labor Code, to read as follows: ART. 129.Recovery of wages, simple money claims and other benefits.—Upon complaint of any interested party, the Regional Director of the Department of Labor and Employment or any of the duly authorized hearing officers of the Department is empowered, through summary proceeding and after due notice, to hear and decide any matter involving the recovery of wages and other monetary claims and benefits, including legal interest, owing to an employee or person employed in domestic or household service or househelper under this code, arising from employer-employee relations, Provided, That such complaint does not include a claim for reinstatement; Provided, further, That the aggregate money claims of each employee or househelper do not exceed five thousand pesos (P5,000.00). The Regional Director or hearing officer shall decide or resolve the complaint within thirty (30) calendar days from the date of the filing of the same. Viewed in the light of RA 6715 and read in consonance with the case of Briad Agro Development Corp., as reconsidered, We hold that the instant case falls under the exclusive original jurisdiction of the Labor Arbiter RA 6715 is in the nature of a curative statute. Curative statutes have long been considered valid in our jurisdiction, as long as they do not affect vested rights. In this case, We do not see any vested right that will be impaired by the application of RA 6715. Inasmuch as petitioner had already paid the claims of private respondents in the amount of P163,047.50 pursuant to the decision rendered in the first complaint, the only claim that should be deliberated upon by the Labor Arbiter should be limited to the second amount given by the Regional Director in the second complaint together with the proposal to offset the obligations. SEAFDEC – AQD V. NLRC

G.R. NO. 86773 FEBRUARY 14, 1992 NOCON, J. Facts: Southeast Asian Fisheries Development Center-Aquaculture Department (SEAFDEC-AQD) is a department of an international organization, the Southeast Asian Fisheries Development Center, organized through an agreement entered into in Bangkok, Thailand. Juvenal Lazaga was employed as a Research Associate. Lacanilao in his capacity as Chief of SEAFDEC-AQD sent a notice of termination to private respondent informing him that due to the financial constraints being experienced by the department, his services shall be terminated. SEAFDEC-AQD's failure to pay Lazaga his separation pay forced him to file a case with the NLRC. The LA and NLRC ruled in favor of Lazaga. SEAFDEC-AQD claimed that the NLRC has no jurisdiction over the case. Issue: W/N NLRC has jurisdiction over the case? NO Held: Petition Granted. Southeast Asian Fisheries Development Center-Aquaculture Department (SEAFDEC-AQD) is an international agency beyond the jurisdiction of public respondent NLRC. Being an intergovernmental organization, SEAFDEC including its Departments (AQD), enjoys functional independence and freedom from control of the state in whose territory its office is located. ZIALCITA, ET AL. V. PAL, RO4-3-3398-76, 20 FEBRUARY 1977 Facts: Complainant Zialcita, an international flight stewardess of PAL, wasdischarged from the service on account of her marriage. In separating Zialcita, PALinvoked its policy which stated that flight attendants must be single, and shall beautomatically separated from employment in the event they subsequently getmarried. They claimed that this policy was in accordance with Article 132 of theLabor Code. On the other hand, Zialcita questioned her termination on account of her marriage, invoking Article 136 of the same law. Issue: W/N Zialcita was validly terminated on account of her marriage. Ruling NO. When Presidential Decree No. 148, otherwise known as theWomen and Child Labor Law, was promulgated in 13 March 1973, PAL’s policy hadmet its doom. However, since no one challenged its validity, the said policy wasable to obtain a momentary reprieve. Section 8 of PD148 is exactly the same provision reproduced verbatim in Article 136 of the Labor Code, which waspromulgated on

1 May 1974 and took effect six months later.Although Article 132 enjoins the Secretary of Labor to establish standardsthat will ensure the safety and health of women employees and in appropriatecases shall by regulation require employers to determine appropriate minimumstandards for termination in special occupations, such as those of flight attendants,it is logical to presume that, in the absence of said standards or regulations whichare yet to be established, the policy of PAL against marriage is patently illegal. Article 136 is not intended to apply only to women employed in ordinaryoccupations, or it should have categorically expressed so. The sweepingintendment of the law, be it on special or ordinary occupations, is reflected inthe whole text and supported by Article 135 that speaks of nondiscriminationon the employment of women. PHILIPPINE GLOBAL COMMUNICATIONS, INC. vs. RICARDO DE VERA G.R. No. 157214 June 7, 2005 FACTS: De Vera and petitioner company entered into a contract where respondent was to attend to the medical needs of petitioner’s employees while being paid a retainer fee of P4,000 per month. Later, De Vera was informed y petitioner that the retainership will be discontinued. Respondent filed a case for illegal dismissal. ISSUE: Whether or not de Vera is an employee of PhilComm or an independent contractor. HELD: Applying the four fold test, de Vera is not an employee. There are several indicators apart from the fact that the power to terminate the arrangement lay on both parties: from the time he started to work with petitioner, he never was included in its payroll; was never deducted any contribution for remittance to the Social Security System (SSS); he was subjected by petitioner to the ten (10%) percent withholding tax for his professional fee, in accordance with the National Internal Revenue Code, matters which are simply inconsistent with an employer-employee relationship; the records are replete with evidence showing that respondent had to bill petitioner for his monthly professional fees. It simply runs against the grain of common experience to imagine that an ordinary employee has yet to bill his employer to receive his salary. Finally, the element of control s absent. Petition granted

JOSE B. SARMIENTO VS. EMPLOYEES' COMPENSATION COMMISSION & GOVERNMENT SERVICE INSURANCE SYSTEM (NATIONAL POWER CORPORATION) G.R. NO. L-65680 MAY 11, 1989 Facts: Flordeliza Sarmiento was employed by the National Power Corporation in Quezon City as accounting clerk in May 1974. At the time of her death on August 12, 1981 she was manager of the budget division. History of the deceased's illness showed that symptoms manifested as early as April 1980 as a small wound over the external auditory canal and mass over the martoid region. Biopsy of the mass revealed cancer known as "differentiated squamous cell carcinoma." The employee sought treatment in various hospitals, namely, Veterans Memorial Hospital, United Doctors Medical Hospital and Makati Medical Center. In March 1981, a soft tissue mass emerged on her left upper cheek as a result of which her lips became deformed and she was unable to close her left eye. She continued treatment and her last treatment at the Capitol Medical Center on July 12, 1 981 was due to her difficulty of swallowing food and her general debility. On August 12, 1981, she succumbed to cardiorespiratory arrest due to parotid carcinoma. She was 40 years old. On August 25, 1983, the respondent Commission affirmed the GSIS' decision. It found that the deceased's death causation by parotid carcinoma is not compensable because she did not contract nor suffer from the same by reason of her work but by reason of embryonic rests and epithelial growth. It may be noted that the petitioner was earlier paid GSIS benefits in the amount of P142,285.03 but the claim for employee's compensation was disallowed. Issue: Whether or not the petitioner is entitled to the employee’s compensation. Held: The wisdom of the present scheme of workmen's compensation is a matter that should be addressed to the President and Congress, not to this Court. Whether or not the former workmen's compensation program with its presumptions, controversions, adversarial procedures, and levels of payment is preferable to the present scheme must be decided by the political departments. The present law was enacted in the belief that it better complies with the mandate on social justice and is more advantageous to the greater number of working men and women. Until Congress and the President decide to improve or amend the law, our duty is to apply it.

WHEREFORE, the petition is DISMISSED. The decisions of the Government Service Insurance System and the Employees' Compensation Commission denying the claim are AFFIRMED. SO ORDERED. ZAIDA G. RARO VS EMPLOYEES' COMPENSATION COMMISSION AND GOVERNMENT SERVICE INSURANCE SYSTEM (BUREAU OF MINES AND GEO-SCIENCES) G.R. NO. L-58445 APRIL 27, 1989 Facts: On March 17, 1975 the petitioner states that she was in perfect health when employed as a clerk by the Bureau of Mines and Geo-Sciences at its Daet, Camarines Norte regional office. Four years later, she began suffering from severe and recurrent headaches coupled with blurring of vision. Forced to take sick leaves every now and then, she sought medical treatment in Manila. She was then a Mining Recorder in the Bureau. The petitioner was diagnosed at the Makati Medical Center to be suffering from brain tumor. A claim for disability benefits filed by her husband with the Government Service Insurance System (GSIS) was denied. A motion for reconsideration was similarly denied. An appeal to the Employees' Compensation Commission resulted in the Commission's affirming the GSIS decision. Issue: 1. Whether brain tumor which causes are unknown but contracted during employment is compensable under the present compensation laws. 2. Whether the presumption of compensability is absolutely inapplicable under the present compensation laws when a disease is not listed as occupational disease. (p. 17, Rollo) Held: Jurisprudence on the compensability of cancer ailments has of late become a source of confusion among the claimants and the government agencies enforcing the employees' compensation law. The strongly lingering influence of the principles of 94 presumption of compensability" and "aggravation" found in the defunct Workmen's Compensation Act but expressly discarded under the present compensation scheme has led to conflict and inconsistency in employees' compensation decisions. Employees' compensation is based on social security principles. All covered employers throughout the country are required by law to contribute fixed and regular premiums or contributions to a trust fund for their employees. Benefits are paid from this trust fund. At the time the amount of contributions was being fixed, actuarial studies were undertaken. The actuarially determined number of workers who would probably file claims within any given year is important in insuring the stability of the said fund and making certain that the system can pay

benefits when due to all who are entitled and in the increased amounts fixed by law.

BELARMINO VS. EMPLOYEES' COMPENSATION COMMISSION G.R. NO. 90204 MAY 11, 1990 Facts: This case involves a claim for benefits for the death of a lady school teacher which the public respondents disallowed on the ground that the cause of death was not work-connected. Petitioner's wife, Oania Belarmino, was a classroom teacher of the Department of Education, Culture and Sports at the Buracan Elementary School in Dimasalang, Masbate .She had been teacher since October 18, 1971. Her husband, the petitioner, is also a public school teacher. That on January 14, 1982, at nine o'clock in the morning, while performing her duties as a classroom teacher, Mrs. Belarmino who was in her 8th month of pregnancy, accidentally slipped and fell on the classroom floor. Moments later, she complained of abdominal pain and stomach cramps. For several days, she continued to suffer from recurrent abdominal pain and a feeling of heaviness in her stomach, but, heedless of the advice of her female co-teachers to take a leave of absence, she continued to report to the school because there was much work to do. On January 25, 1982, eleven (11) days after her accident, she went into labor and prematurely delivered a baby girl at home. Her abdominal pains persisted even after the delivery, accompanied by high fever and headache. She was brought to the Alino Hospital in Dimasalang, Masbate on February 11, 1982. Dr. Alfonso Alino found that she was suffering from septicemia post partum due to infected lacerations of the vagina. She was discharged from the hospital after five (5) days on February 16, 1982, apparently recovered but she died three (3) days later. The cause of death was septicemia post partum. She was 33 years old, survived by her husband and four (4) children, the oldest of whom was 11 years old and the youngest, her newborn infant. Issue: Whether or not that there is no merit in the public respondents' argument that the cause of the decedent's post partum septicemia "was the infected vaginal lacerations resulting from the decedent's delivery of her child at home" for the incident in school could not have caused septicemia post partum. Held:

After a careful consideration of the petition and the annexes thereof, as well as the comments of the public respondents, we are persuaded that the public respondents' peremptory denial of the petitioner's claim constitutes a grave abuse of discretion. Rule III, Section 1 of the Amended Rules on Employees' Compensation enumerates the grounds for compensability of injury resulting in disability or death of an employee, as follows: Sec. 1. Grounds — (a) For the injury and the resulting disability or death to be compensable, the injury must be the result of an employment accident satisfying all of the following conditions: The employee must have been injured at the place where his work requires him to be; The employee must have been performing his official functions; and If the injury is sustained elsewhere, the employee must have been executing an order for the employer. For the sickness and the resulting disability or death to be compensable, the sickness must be the result of an occupational disease listed under Annex "A" of these Rules with the conditions set therein satisfied; otherwise, proof must be shown that the risk of contracting the disease is increased by the working conditions. Only injury or sickness that occurred on or after January 1, 1975 and the resulting disability or death shall be compensable under these Rules. The argument is unconvincing. It overlooks the fact that septicemia post partum is a disease of childbirth, and premature childbirth would not have occurred if she did not accidentally fall in the classroom. It is true that if she had delivered her baby under sterile conditions in a hospital operating room instead of in the unsterile environment of her humble home, and if she had been attended by specially trained doctors and nurses, she probably would not have suffered lacerations of the vagina and she probably would not have contracted the fatal infection. Furthermore, if she had remained longer than five (5) days in the hospital to complete the treatment of the infection, she probably would not have died. But who is to blame for her inability to afford a hospital delivery and the services of trained doctors and nurses? The court may take judicial notice of the meager salaries that the Government pays its public school teachers. Forced to live on the margin of poverty, they are unable to afford expensive hospital care, nor the services of trained doctors and nurses when they or members of their families are in. Penury compelled the deceased to scrimp by delivering her baby at home instead of in a hospital.

The Government is not entirely blameless for her death for it is not entirely blameless for her poverty. Government has yet to perform its declared policy "to free the people from poverty, provide adequate social services, extend to them a decent standard of living, and improve the quality of life for all (Sec. 7, Art. II, 1973 Constitution and Sec. 9, Art. II, 1987 Constitution). Social justice for the lowly and underpaid public school teachers will only be an empty shibboleth until Government adopts measures to ameliorate their economic condition and provides them with adequate medical care or the means to afford it. "Compassion for the poor is an imperative of every humane society" (PLDT v. Bucay and NLRC, 164 SCRA 671, 673). By their denial of the petitioner's claim for benefits arising from the death of his wife, the public respondents ignored this imperative of Government, and thereby committed a grave abuse of discretion. HINOGUIN VS EMPLOYEES COMPENSATION COMMISSION G.R. 84307 APRIL 17, 1989 FELICIANO, J. Facts: Sgt. Lemick Hinoguin was a sergeant in “A” company, 14th Infantry Battalion, 5th Infantry Division, Philippine Army. On August 1, 1985, Sgt. Hinoguin, Cpl. Rogelio Clavo and Dft. Nicomedes Alibuyog sought permission from Capt. Frankie Besas, to go on overnight pass to Aritao, Nueva Viscaya. Capt. Besas orally granted them permission to go to Aritao and to take their issued firearms with them considering that Aritao was regarded as “a critical place.” The three soldiers went to Dft. Alibuyog’s home for a meal and some drinks. At around 7:00 PM, the soldiers headed back to the headquarters. They boarded a tricycle. When they reached the poblacion, Alibuyog dismounted from the tricycle. Not noticing that his rifle’s safety lever was on “semi-automatic,” he accidentally touched the trigger, firing a single shot in the process and hitting Sgt. Hinoguin in the left lower abdomen. Sgt. Hinoguin died a few days after the incident. In the investigation conducted by the 14th Infantry Battalion, it was found that the shooting of Sgt. Hinoguin was purely accidental in nature and that he died in the line of duty. The Life of Duty Board of Officers recommended that all benefits due the legal dependents of the late Sgt. Hinoguin be given. However, when the father of the deceased made a claim from GSIS, the same was denied on the ground that the deceased was neither at his work place nor performing his duty as a soldier of the Philippine Army at the time of his death. This denial was confirmed by the respondent ECC. Issue: WON the death of Sgt. Hinoguin is compensable.

Held: Article 167 (k) of the Labor Code as amended defines a compensable “injury” quite simply as “any harmful change in the human organism from any accident arising out of and in the course of the employment.” The Amended (Implementing) Rules have, however, elaborated considerably on the simple and succinct statutory provision. Rule III, Section 1 (a) reads: SECTION 1. Grounds. (a) For the injury and the resulting disability or death to be compensable, the injury must be the result of an employment accident satisfying all of the following grounds: The employee must have been injured at the place work requires him to be; The employee must have been performing his official functions; and If the injury is sustained elsewhere, the employee must have been executing an order for the employer. The concept of a “work place” referred to in Ground 1, for instance, cannot always be literally applied to a soldier on active duty status, as if he were a machine operator or a worker in an assembly line in a factory or a clerk in a particular fixed office. Obviously, a soldier must go where his company is stationed. In the instant case, Aritao, Nueva Viscaya was not, of course, Carranglan, Nueva Ecija. Aritao being approximately 1-1/2 hours away from the latter by public transportation. But Sgt. Hinoguin, Cpl. Clavo and Dft. Alibuyog had permission from their Commanding Officer to proceed to Aritao, and it appears to us that a place which soldiers have secured lawful permission to be at cannot be very different, legally speaking, from a place where they are required to go by their commanding officer. They were not on vacation leave. It may be noted in this connection that a soldier on active duty status is really on 24 hours a day official duty status and is subject to military discipline and military law 24 hours a day. He is subject to call and to the orders of his superior officers at all times, 7 days a week, except, of course, when he is on vacation leave status (which Sgt. Hinoguin was not). Indeed, it appears to us that a soldier should be presumed to be on official duty unless he is shown to have clearly and unequivocally put aside that status or condition temporarily by, e.g., going on an approved vacation leave. Thus, we think that the work-connected character of Sgt. Hinoguins injury and death was not effectively precluded by the simple circumstance that he was on an overnight pass to go to the home of Dft. Alibuyog, a soldier under his own command. Sgt. Hinoguin did not effectively cease performing “official functions” because he was granted a pass. While going to a fellow soldier’s home for a few hours for a meal and some drinks was not a specific military duty, he was nonetheless in the course of performance of official functions.

GSIS VS CA & F. ALEGRE G.R. NO. 128524 APRIL 20, 1999 Facts: Private respondent Felonila Alegre’s deceased husband, SPO2 Florencio A. Alegre, was a police officer assigned to the Philippine National Police station in the town of Vigan, Ilocos Sur. On December 6, 1994, he was driving his tricycle and ferrying passengers within the vicinity of Imelda Commercial Complex when SPO4 Alejandro Tenorio, Jr., Team/Desk Officer of the Police Assistance Center located at said complex, confronted him regarding his tour of duty. SPO2 Alegre allegedly snubbed SPO4 Tenorio and even directed curse words upon the latter. A verbal tussle then ensued between the two which led to the fatal shooting of the deceased police officer. Private respondent seasonably filed a claim for death benefits with petitioner Government Service Insurance System (GSIS) pursuant to Presidential Decree No. 626. In its decision on August 7, 1995, the GSIS, however, denied the claim on the ground that at the time of SPO2 Alegre’s death, he was performing a personal activity which was not work-connected. Subsequent appeal to the Employees’ Compensation Commission (ECC) proved futile as said body, in a decision dated May 9, 1996, merely affirmed the ruling of the GSIS. Issue: Whether or not a moonlighting policeman’s death be considered compensable? Held: The private respondent finally obtained a favorable ruling in the Court of Appeals when on February 28, 1997, the appellate court reversed the ECC’s decision and ruled that SPO2 Alegre’s death was work-connected and, therefore, compensable. Citing Nitura v. Employees’ Compensation Commission and Employees’ Compensation Commission v. Court of Appeals,[4] the appellate court explained the conclusion arrived at, thus: “The Supreme Court held that the concept of a ‘workplace’ cannot always be literally applied to a person in active duty status, as if he were a machine operator or a worker in an assembly line in a factory or a clerk in a particular fixed office. The deceased was driving his tricycle, with passengers aboard, when he was accosted by another police officer. This would lend some semblance of viability to the argument that he was not in the performance of official duty at the time. However, the argument, though initially plausible, overlooks the fact that policemen, by the nature of their functions, are deemed to be on a round-theclock duty.”

Aggrieved, GSIS comes to us on petition for review on certiorari reiterating its position that SPO2 Alegre’s death lacks the requisite element of compensability which is, that the activity being performed at the time of death must be workconnected. Under the pertinent guidelines of the ECC on compensability, it is provided that “for the injury and the resulting disability or death to be compensable, the injury must be the result of an employment accident satisfying all of the following conditions: The employee must have been injured at the place where his work requires him to be; The employee must have been performing his official functions; and If the injury is sustained elsewhere, the employee must have been executing an order for the employer.”[5] As to the question of whether or not he was performing an official function at the time of the incident, it has been held that a soldier on active duty status is really on a 24 hours a day official duty status and is subject to military discipline and military law 24 hours a day. He is subject to call and to the orders of his superior officers at all times, seven (7) days a week, except, of course, when he is on vacation leave status. Thus, a soldier should be presumed to be on official duty unless he is shown to have clearly and unequivocally put aside that status or condition temporarily by going on approved vacation leave.” The Court did not justify its grant of death benefits merely on account of the rule that soldiers or policemen, as the case may be, are virtually working round-theclock. Note that the Court likewise attempted in each case to find a reasonable nexus between the absence of the deceased from his assigned place of work and the incident that led to his death. In other words, the 24-hour duty doctrine should not be sweepingly applied to all acts and circumstances causing the death of a police officer but only to those which, although not on official line of duty, are nonetheless basically police service in character. ILOILO DOCK AND ENGINEERING CORP VS WCC G.R. NO. L-26341 NOVEMBER 27, 1968 Facts: An appeal by the Iloilo Dock and Engineering Company (hereinafter referred to as the IDECO) from the decision dated February 28, 1966 of the Workmen's Compensation Commission (hereinafter referred to as the Commission) affirming the decision of the Regional Office VII in Iloilo City, and ordering the IDECO to pay to the widow and children of Teodoro G. Pablo (Irenea M. Pablo and the minors Edwin, Edgar and Edna, all surnamed Pablo) the sum of P4,000, to pay

to the widow P89 as reimbursement for burial expenses and P300 as attorney's fees, and to pay to the Commission the amount of P46 as fees pursuant to section 55 of the Workmen's Compensation Act, as amended. On January 29, 1960, Pablo, who was employed as a mechanic of the IDECO, while walking on his way home, was shot to death in front of, and about 20 meters away from, the main IDECO gate, on a private road commonly called the IDECO road. The slayer, Martin Cordero, was not heard to say anything before or after the killing. The motive for the crime was and still is unknown as Cordero was himself killed before he could be tried for Pablo's death. At the time of the killing, Pablo's companion was Rodolfo Galopez, another employee, who, like Pablo, had finished overtime work at 5:00 p.m. and was going home. From the main IDECO gate to the spot where Pablo was killed, there were four "carinderias" on the left side of the road and two "carinderias" and a residential house on the right side. The entire length of the road is nowhere stated in the record. Issue: Whether Pablo's death comes within the meaning and intendment of that "deceptively simple and litigiously prolific. Held: The statute is not intended to relieve completely an employee from the burden of showing that accidental injuries suffered by him actually were sustained in the course of his employment. "It is not the law that mere proof of an accident, without other evidence, creates the presumption under section 21 of the Workmen's Compensation Law (Consol. Law, c. 67) that the accident arose out of and in the course of the employment. On the contrary, it has been frequently held, directly and indirectly, that there must be some evidence from which the conclusion can be drawn that the injuries did arise out of and in the course of the employment." Proof of the accident will give rise to the statutory presumption only where some connection appears between the accident and the employment. But even without the foregoing pronouncement, the employer should still be held liable in view of our conclusion that that portion of the road where Pablo was killed, because of its proximity, should be considered part of the IDECO's premises. Hence, the injury was in the course of employment, and there automatically arises the presumption — invoked in Rivera — that the injury by assault arose out of the employment, i. e., there is a causal relation between the assault and the employment. We do say here that the circumstances of time, two minutes after dismissal from overtime work, and space, twenty meters from the employer's main gate, bring Pablo's death within the scope of the course factor. But it may logically be asked: Suppose it were three minutes after and thirty meters from, or five minutes after and fifty meters from, would the "proximity" rule still apply? In answer, we need but quote that portion of the decision in Jean vs. Chrysler Corporation, supra,

which answered a question arising from an ingenious hypothetical question put forth by the defendant therein: We could, of course, say "this is not the case before us" and utilize the old saw, "that which is not before us we do not decide." Instead, we prefer to utilize the considerably older law: "Sufficient unto the day is the evil thereof" (Matthew 1:34), appending, however, this admonition: no statute is static; it must remain constantly viable to meet new challenges placed to it. Recovery in a proper case should not be suppressed because of a conjectural posture which may never arise and which if it does, will be decided in the light of then existing law. Since the Workmen's Compensation Act is basically a social legislation designed to afford relief to workmen, it must be liberally construed to attain the purpose for which it was enacted. Liberally construed, sec. 2 of the Act comprehends Pablo's death. The Commission did not err in granting compensation.

ALANO VS ECC G.R. NO. L-48594 MARCH 16, 1988 Facts: That on June 27, 1977, Generoso C. Alano, brother of the deceased, filed the instant claim for in come benefit with the GSIS for and in behalf of the decedent's children. The claim was, however, denied on the same date on the ground that the "injury upon which compensation is being claimed is not an employment accident satisfying all the conditions prescribed by law." On July 19, 1977 appellant requested for a reconsideration of the system's decision, but the same was denied and the records of the case were elevated to this Commission for review. A government employee during her lifetime, Dedicacion de Vera, worked as principal of Salinap Community School in San Carlos City, Pangasinan. Her tour of duty was from 7:30 a.m. to 5:30 p.m. On November 29, 1976, at 7:00 A.M., while she was waiting for a ride at Plaza Jaycee in San Carlos City on her way to the school, she was bumped and run over by a speeding Toyota mini-bus which resulted in her instantaneous death. She is survived by her four sons and a daughter. Issue: Whether or not the injury sustained by the deceased Dedicacion de Vera resulting in her death is compensable under the law as an employment accident.

Held: In this case, it is not disputed that the deceased died while going to her place of work. She was at the place where, as the petitioner puts it, her job necessarily required her to be if she was to reach her place of work on time. There was nothing private or personal about the school principal's being at the place of the accident. She was there because her employment required her to be there. As to the Government Service Insurance System's manifestation, we hold that it is not fatal to this case that it was not impleaded as a party respondent. As early as the case of La O v. Employees' Compensation Commission, (97 SCRA 782) up to Cabanero v. Employees' Compensation Commission (111 SCRA 413) and recently, Clemente v. Government Service Insurance System (G.R. No. L-47521, August 31,1987), this Court has ruled that the Government Service Insurance System is a proper party in employees' compensation cases as the ultimate implementing agency of the Employees' Compensation Commission. We held in the aforecited cases that "the law and the rules refer to the said System in all aspects of employee compensation including enforcement of decisions (Article 182 of Implementing Rules)."

LAZO VS EMPLOYEES COMPENSATION COMMISSION G.R. NO. 78617 JUNE 18, 1990 Facts: At about 6:00 o'clock in the morning of 19 June 1986, on his way home, the passenger jeepney the petitioner was riding on turned turtle due to slippery road. As a result, he sustained injuries and was taken to the Angono Emergency Hospital for treatment. He was later transferred to the National Orthopedic Hospital where he was confined until 25 July 1986. Petitioner, Salvador Lazo, is a security guard of the Central Bank of the Philippines assigned to its main office in Malate, Manila. His regular tour of duty is from 2:00 o'clock in the afternoon to 10:00 o'clock in the evening. On 18 June 1986, the petitioner rendered duty from 2:00 o'clock in the afternoon to 10:00 o'clock in the evening. But, as the security guard who was to relieve him failed to arrive, the petitioner rendered overtime duty up to 5:00 o'clock in the morning of 19 June 1986, when he asked permission from his superior to leave early in order to take home to Binangonan, Rizal, his sack of rice. Issue: Whether or not the accident which involved the petitioner occurred far from his work place and while he was attending to a personal matter.

Held: In the case at bar, it can be seen that petitioner left his station at the Central Bank several hours after his regular time off, because the reliever did not arrive, and so petitioner was asked to go on overtime. After permission to leave was given, he went home. There is no evidence on record that petitioner deviated from his usual, regular homeward route or that interruptions occurred in the journey. While the presumption of compensability and theory of aggravation under the Workmen's Compensation Act (under which the Baldebrin case was decided) may have been abandoned under the New Labor Code, 8 it is significant that the liberality of the law in general in favor of the workingman still subsists. As agent charged by the law to implement social justice guaranteed and secured by the Constitution, the Employees Compensation Commission should adopt a liberal attitude in favor of the employee in deciding claims for compensability, especially where there is some basis in the facts for inferring a work connection to the accident. This kind of interpretation gives meaning and substance to the compassionate spirit of the law as embodied in Article 4 of the New Labor Code which states that 'all doubts in the implementation and interpretation of the provisions of the Labor Code including its implementing rules and regulations shall be resolved in favor of labor.' The policy then is to extend the applicability of the decree (PD 626) to as many employees who can avail of the benefits thereunder. This is in consonance with the avowed policy of the State to give maximum aid and protection to labor. 9 There is no reason, in principle, why employees should not be protected for a reasonable period of time prior to or after working hours and for a reasonable distance before reaching or after leaving the employer's premises. VICENTE VS. ECC G.R. NO. 85024 JANUARY 23, 1991 SARMIENTO, J. FACTS: [P]etitioner was formerly employed as a nursing attendant at the Veterans Memorial Medical Center in Quezon City. At the age of forty-five, and after having rendered more than twenty-five years of government service, he applied for optional retirement under the provisions of Section 12(c) of Republic Act No. 1616, giving as reason therefor his inability to continue working as a result of his physical disability. The petitioner likewise filed with the Government Service Insurance System (GSIS) an application for “income benefits claim for payment” under Presidential Decree (PD) No. 626, as amended. Both applications were accompanied by the necessary supporting papers, among them being a

“Physician’s Certification” issued by the petitioner’s attending doctor. The petitioner’s application for income benefits claim payment was granted but only for permanent partial disability (PPD) compensation or for a period of nineteen months ISSUE: Whether or not the petitioner suffers from permanent total disability. HELD: YES. The decision of the respondent Employees’ Compensation Commission (ECC) was set aside. RATIO: [T]he petitioner’s permanent total disability is established beyond doubt by several factors and circumstances. Noteworthy is the fact that from all available indications, it appears that the petitioner’s application for optional retirement on the basis of his ailments had been approved. Considering that the petitioner was only 45 years old when he retired and still entitled, under good behavior, to 20 more years in service, the approval of his optional retirement application proves that he was no longer fit to continue in his employment. For optional retirement is allowed only upon proof that the employee-applicant is already physically incapacitated to render sound and efficient service. The sympathy of law on social security is towards its beneficiaries and the law by its own terms, requires a construction of utmost liberality in its favor. PEREZ VS EMPLOYEES COMPENSATION COMMISSION G.R. NO. L-48488 APRIL 25, 1980 Facts: On October 21, 1976, petitioner filed a claim for disability benefits under Presidential Decree No. 626, as amended, with respondent Government Service Insurance System (p. 1, ECC rec.). On October 25, 1976, respondent GSIS denied said claim on the ground that petitioner's ailments, rheumatoid arthritis and pneumonitis, are not occupational diseases taking into consideration the nature of her particular work. In denying aforesaid claim, respondent GSIS thus resolved: Upon evaluation based on general accepted medical authorities, your ailments are found to be the least causally related to your duties and conditions of work. We believe that our ailments are principally traceable to factors which are

definitely not work-connected. Moreover, the evidences you have, submitted have not shown that the said ailments directly resulted from your occupation as Teacher IV of Raja Soliman High School, Manila (Letter-Resolution, p. 4, ECC Case No. 0462). Petitioner now maintains that her ailments arose in the course of employment and were aggravated by the condition and nature of her work. Specifically, she asserts that "pneumonitis or baby pneumonia which has become chronic that led to bronchiectasis which is irreversible and permanent in nature is compensable under No. 21 of compensable diseases (Resolution No. 432 dated July 20, 1977) as conditions were present as attested to by doctor's affidavits and certifications." Issue: Whether or not petitioner’s claims she contracted pneumonitis and/or bronchiectasis with hemoptysis and rheumatoid arthritis on January 27, 1975 after wetting and chilling during the course of employment which are permanent and recurring in nature and work-connected. Held: Article 167 (1) of the new Labor Code provides that — 'Sickness' means any illness definitely accepted as an occupational disease listed by the Commission, or any illness caused by employment subject to proof by the employee that the risk of contracting the same is increased by working conditions. ... Rule 111, Section 1 (b) of the Amended Rules on Employees' Compensation thus provides: (b) For the sickness and the resulting disability or death to be compensable, the sickness must be the result of an occupational disease listed under Annex 'A' of these Rules with the conditions set therein satisfied; otherwise, proof must be shown that the risk of contracting the disease is increased by working conditions. Rule III, Section 1 (c) of said Rules states: Only inqiury or sickness that occurred on or after January 1, 1975 and the resulting disability or death shall be compensable under these Rules. The aforequoted provisions clearly establish that for an illness to be compensable, it must either be: An illness definitely accepted as an occupational disease; or An illness caused by employment subject to proof by the employee that the risk of contracting the same is increased by working conditions.

Significantly, also, the Employees' Compensation Commission, in its Resolutions Nos. 233 and 432, respectively dated March 16, 1977 and July 20, 1977, adopted a more realistic construction of the provisions of the New Labor Code by including in the list of compensable ailments and diseases, cardiovascular disease which comprehends myocardial infarction, pneumonitis and bronchial asthma (Sepulveda vs. WCC, et al., L-46290, Aug. 25,1978). Furthermore, it must be stressed that "the approval of petitioner's application for retirement is a clear indication that she was physically incapacitated to render efficient service (Sudario vs. Republic, L-44088, Oct. 6, 1977; Dimaano vs. WCC, et al., supra). Petitioner was allowed to retire under the disability retirement plan on August 31, 1975 at the age of 54 which is way below the compulsory retirement age of 65. Under Memorandum Circular No. 133 issued by the retirement shall be recommended for approval only when "the employee applicant is below 65 years of age and is physically incapacitated to render further efficient service." Obviously, petitioner thus retired by reason of her ailments. Finally, Republic Act 4670, otherwise known as the Magna Charta for Public School Teachers, recognized the enervating effects of these factors (duties and activities of a school teacher certainly involve physical, mental and emotional stresses) on the health of school teachers when it directed in one of its provisions that "Teachers shall be protected against the consequences of employment injury in accordance with existing laws. The effects of the physical and nervous strain on the teachers's health shall be recognized as compensable occupational diseases in accordance with laws" (Pantoja vs. Republic, et al.. L-43317, December 29, 1978.)