Labor Supplements 2016 Pre Week La Kato

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Supplement:Selected Compilations of  LA T. Adrian S. Umbac II 1 Bar 2016

Pre-week Labor Updates Prof. Benedict G. Kato, LA (Arranger Only, with Permission from LA Umbac) SUPPLEMENT NO. 001 EMPLOYEE COMPENSATION

B artolom rtolome e vs . S ocial S ecurity S ys tem, em, G .R . No. 192531, 192531, Novembe Novemberr 12, 2014 1. Rule limiting entitlement to death benefit claims to legitimate parents is contrary to law. In Commissioner of Internal Revenue v. Fortune Tobacco Corporation , the SC held:  Administrative regulations must always be in harmony with the provisions of the law because any resulting discrepancy between the two will always be resolved in favor of the basic law. Guided by this doctrine, Rule XV of the the Amended Amended Rules on Employees’ Compensation is patently a wayward restriction of and a substantial deviation from  Article 167 (j) of the Labor Lab or Code when it interpreted the phrase “dependent parents” to refer to “legitimate parents.”  Article 167 (j), as couched, clearly shows that Congress did not intend to limit the phrase “dependent parents” to solely legitimate parents. .. The manner by which which the provision in question was crafted undeniably shows that the phrase “dependent parents” was intended to cover all parents –  legitimate, illegitimate or parents by nature or adoption.

2. Biological parent who earlier gave up child for adoption considered a dependent parent; death of adopter results in parental authority reverting to biological parent. John’s minority at the time of his adopter’s death is a significant . Under such circumstance, parental authority should be deemed to have reverted in favor of the biological parents. Moreover, John, in in his SSS application, named petitioner as one of his beneficiaries for his benefits under RA 8282, otherwise known as the “Social Security Law.” While RA 8282 does not cover compensation for work -related deaths or injury and expressly allows the designation of beneficiaries who are not related by blood to the member unlike in PD 626, John’s delibe rate act of indicating petitioner as his beneficiary at least evinces that he, in a way, considered petitioner as his dependent. Consequently, the confluence of circumstances  – from Cornelio’s death during John’s minority, the restoration of petitioner’s p arental authority, the documents showing singularity of address, and John’s clear intention to designate petitioner as a beneficiary - effectively made petitioner, to Our mind, entitled to death benefit claims as a secondary beneficiary under PD 626 as a dependent parent.

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LA Tiburcio Adrian S. Umbac, formerly a Reviewing Arbiter of the First Division of the NLRC and now a Line Arbiter Arbiter at NLRC Cebu City, has devoted his time to legal research for the convenience convenien ce of the entire agency. His SUPPLEMENTS, SUPPLEMENTS, which he regularly emails to Commissioners and his colleagues, have made made research a quicky experience for all at the NLRC. He has once again given his kind permission to this “arranger” to share his materials to Bar reviewees. reviewees. Our gratitude, Your Honor.

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RETIREMENT

G oodyea oodyearr P hilippines hilippines , Inc. vs . A ng us , G .R . No. 185449 185449,, Novembe Novemberr 12, 2014 2014 1. When employee is entitled to both separation pay and early retirement benefit in the absence of a provision in the CBA prohibiting recovery of both. Retirement benefits and separation pay are not mutually exclusive. Retirement benefits are a form of reward for an employee's loyalty and service to an employer and are earned under existing laws, CBAs, employment contracts and company policies. On the other hand, separation pay is that amount which an employee receives at the time of his severance from employment, designed to provide the employee with the wherewithal during the period that he is looking for another employment and is recoverable only in instances enumerated under Articles 283 and 284 of the Labor Code or in illegal dismissal cases when reinstatement is not feasible. In the case at bar,  Article 283 clearly entitles Angus to separation pay apart from the retirement benefits she received from petitioners. TERMINATION  – CONSEQUENCES

FV R S ki lls lls and Servic es E xponents, xponents, Inc. vs . S eva, eva, et. et. al., G .R . No. 2008 200857, 57, October October  22, 2014 1. When corporate officers are not solidarily liable with the corporation.  A director or officer shall only be personally liable for the obligations of the corporation, if the following conditions concur: (1) the complainant alleged in the complaint that the director or officer assented to patently unlawful acts of the corporation, or that the officer was guilty of gross negligence or bad faith; and (2) the complainant clearly and convincingly proved such unlawful acts, negligence or bad faith. SUPPLEMENT NO. 002 EMPLOYEE COMPENSATION 1. When death of seafarer considered work-related.

R acelis celis vs . United United Philippine Lines , Inc., G .R . No. 198408, 198408, Novemb November er 12, 2014 2014 While it is true that Brainstem (pontine) Cavernous Malformation is not listed as an occupational disease under Section 32-A of the 2000 POEA-SEC, Section 20 (B) (4) of the same explicitly provides that “[t[he liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract are as follows: (t)hose illnesses not listed in Section 32 of this Contract are disputably presumed as work related .” … This presumption should be overturned only when when the employer’s refutation is found to be supported by substantial evidence. 2. Seafarer’s death occurred during period of employment even if he was

medically repatriated. While it is true that a medical repatriation has the effect of terminating the seafarer’s contract of employment, it is, however, enough that the work -related illness, which eventually becomes the proximate cause of death, occurred while the contract was effective for recovery to be had. Consistent with the State’s avowed policy to afford full protection to labor as enshrined in Article XIII XIII of the 1987 Philippine Philippine Constitution, the POEA-SEC POEA-SEC was designed primarily for the protection and benefit of Filipino seafarers in the pursuit of their employment on board ocean-going vessels. As such, it is a standing principle that

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RETIREMENT

G oodyea oodyearr P hilippines hilippines , Inc. vs . A ng us , G .R . No. 185449 185449,, Novembe Novemberr 12, 2014 2014 1. When employee is entitled to both separation pay and early retirement benefit in the absence of a provision in the CBA prohibiting recovery of both. Retirement benefits and separation pay are not mutually exclusive. Retirement benefits are a form of reward for an employee's loyalty and service to an employer and are earned under existing laws, CBAs, employment contracts and company policies. On the other hand, separation pay is that amount which an employee receives at the time of his severance from employment, designed to provide the employee with the wherewithal during the period that he is looking for another employment and is recoverable only in instances enumerated under Articles 283 and 284 of the Labor Code or in illegal dismissal cases when reinstatement is not feasible. In the case at bar,  Article 283 clearly entitles Angus to separation pay apart from the retirement benefits she received from petitioners. TERMINATION  – CONSEQUENCES

FV R S ki lls lls and Servic es E xponents, xponents, Inc. vs . S eva, eva, et. et. al., G .R . No. 2008 200857, 57, October October  22, 2014 1. When corporate officers are not solidarily liable with the corporation.  A director or officer shall only be personally liable for the obligations of the corporation, if the following conditions concur: (1) the complainant alleged in the complaint that the director or officer assented to patently unlawful acts of the corporation, or that the officer was guilty of gross negligence or bad faith; and (2) the complainant clearly and convincingly proved such unlawful acts, negligence or bad faith. SUPPLEMENT NO. 002 EMPLOYEE COMPENSATION 1. When death of seafarer considered work-related.

R acelis celis vs . United United Philippine Lines , Inc., G .R . No. 198408, 198408, Novemb November er 12, 2014 2014 While it is true that Brainstem (pontine) Cavernous Malformation is not listed as an occupational disease under Section 32-A of the 2000 POEA-SEC, Section 20 (B) (4) of the same explicitly provides that “[t[he liabilities of the employer when the seafarer suffers work-related injury or illness during the term of his contract are as follows: (t)hose illnesses not listed in Section 32 of this Contract are disputably presumed as work related .” … This presumption should be overturned only when when the employer’s refutation is found to be supported by substantial evidence. 2. Seafarer’s death occurred during period of employment even if he was

medically repatriated. While it is true that a medical repatriation has the effect of terminating the seafarer’s contract of employment, it is, however, enough that the work -related illness, which eventually becomes the proximate cause of death, occurred while the contract was effective for recovery to be had. Consistent with the State’s avowed policy to afford full protection to labor as enshrined in Article XIII XIII of the 1987 Philippine Philippine Constitution, the POEA-SEC POEA-SEC was designed primarily for the protection and benefit of Filipino seafarers in the pursuit of their employment on board ocean-going vessels. As such, it is a standing principle that

3 its provisions are to be construed and applied fairly, reasonably, and liberally in their favor. Guided by this principle, the Court, in the recent case of Canuel , recognized that a medical repatriation case constitutes an exception to the second requirement under Section 20 (A) (1) of the 2000 POEA-SEC, i.e., that the seafarer’s death had occurred during the term of his employment, in view of the terminative consequences of a medical repatriation under Section 18 (B) of the same. In essence, the Court held that under such circumstance, the work-related death need not precisely occur during the term of his employment as it is enough that t he seafarer’s work -related injury or illness which eventually causes his death had had occurred during the term of his employment. 3. Seafarer not immediately repatriated after his contract expired, thus his injury incurred after his contract expired was work-related.

B ahia Shipping S ervices ervices , Inc. vs . Hipe, J r., G .R . No. 20469 204699, 9, Novem November ber 12, 2014 2014 The issue of whether the seafarer can legally demand and claim disability benefits from the employer/manning agency for an injury or illness suffered may be determined from the pertinent provisions of the 2000 POEA-SEC. Hipe was made to continuously perform work aboard the vessel beyond his six-month contract without the benefit of a formal contract. Considering that any extension of his employment is discretionary on the part of respondents and that the latter offered no explanation why Hipe was not repatriated when his contract expired on June 5, 2008, the CA correctly ruled that he was still under the employ of respondents when he sustained an injury on June 22, 2008. Consequently, the injury suffered by Hipe was a work-related injury and his eventual repatriation on August 5, 2008, for which he was treated/rehabilitated can only be considered as a medical repatriation. 5. When fit-to-work certification of the company-designated physician stands; opinion of the seafarer’s physician was not supported by any diagnostic tests

and/or procedures as would adequately refute the fit-to-work assessment, but merely relied on a review of Hipe’s medical history and his ph ysical examination. Nonetheless, Hipe was subsequently declared fit to work by the companydesignated physician on October 9, 2008, or merely 65 days after his repatriation, thus negating the existence of any permanent disability for which compensability is sought. Said fit-to-work certification must stand for two (2) reasons:

First , while Hipe’s personal doctor disagreed with the abovementioned assessment, opining that “it would be impossible for him to work as seaman -plumber” and recommending a disability grade of five, records show, however, that such opinion was not supported by any diagnostic tests and/or procedures as would adequately refute the fit-to-work assessment, but merely relied on a review of Hipe’s medical history and his physical examination; and  S econd  eco nd , Hipe failed to comply with the procedure laid down under Section 20 (B) (3) of the 2000 POEA-SEC with regard to the joint appointment by the parties of a third doctor whose decision shall be final and binding on them in case the s eafarer’s personal doctor disagrees with the company-designated physician’s fit -to-work assessment. In Philippine Hammonia Ship Agency, Inc. v. Dumadag  (Philippine Hammonia ), the Court held that the seafarer’s non -compliance with the said conflict-resolution procedure results in the affirmance of the fit-to-work certification of the company-designated physician.

4 EMPLOYEE STATUS 1. Employee occupied a fiduciary position and thus held a position of trust and confidence.

P.J . Lhuillier Inc. v s . Velayo, G .R . No. 198620, November 12, 2014 The respondent was first hired by the petitioners as an accounting clerk on June 13, 2003, for which she received a basic monthly salary of 9,353.00. On October 29, 2007, the date of the subject incident, she performed the function of vault custodian and cashier in the petitioners’ Branch 4 pawnshop in Capistrano, Cagayan de Oro City. In addition to her custodial duties, it was the respondent who electronically posted the day’s transactions in the books of accounts of the branch, a function that is essentially separate from that of cashier or custodian. It is plain to see then that when both functions are assigned to one person to perform, a very risky situation of conflicting interests is created whereby the cashier can purloin the money in her custody and effectively cover her tracks, at least temporarily, by simply not recording in the books the cash receipt she misappropriated. This is commonly referred to as lapping of accounts. Only a most trusted clerk would be allowed to perform the two functions, and the respondent enjoyed this trust. SUPPLEMENT NO. 003 APPEAL

 Michelin A s ia Pacific A pplic ation S uppor t C enter, Inc. vs . Ortiz, G .R . No. 189861, November 19, 2014 1. Appeal properly dismissed by the NLRC due to complainant’s failure to attach a certificate of non-forum shopping, in filing a motion for reconsideration beyond the 10day period, and in filing a prohibited second motion for reconsideration. 2. Filing of a prohibited second motion for reconsideration did not toll the running of the 60-day period for filing a petition for certiorari under Rule 65, thus petition filed out of time. JUDGMENTS

Univers ity of P ang as inan, Inc. vs . F lorentino Fernandez and Heir s of Nilda Fernandez, G.R . No. 211228, November 12, 2014 1. Updating the computation of awards to include as well backwages and separation pay corresponding to the period after the rendition of LA Gambito’s decision on November 6, 2000 up to its finality on July 11, 2005 is not violative of the principle of immutability of a final and executory judgment. 2. When inclusion of 13 th month pay into the computation proper even though it was not exclusively provided for in the CA decision. RETIREMENT

Univers ity of P ang as inan, Inc. vs . F lorentino Fernandez and Heir s of Nilda Fernandez, G.R . No. 211228, November 12, 2014 1. Computation of backwages and separation pay should not be up to the dates when complainants turned 60, as this age is only for optional retirement and there is no showing that 60 was the provided mandatory age for faculty members.

5 SUPPLEMENT NO. 004 EMPLOYEE COMPENSATION

Government Service Insurance System vs. Calumpiano, G.R. No. 196102, November 26, 2014 1. When court stenographer’s hypertension and resulting glaucoma considered

compensable. In Government Service Insurance System v. Baul, it was held: Cerebro-vascular accident and essential hypertension are considered as occupational diseases under Nos. 19 and 29, respectively, of Annex “A” of the Implementing Rules of P.D. No. 626, as amended. Thus, it is not necessary that there be proof of causal relation between the work and the illness which resulted in the respondent’s disability. The open-ended Table of Occupational Diseases requires no proof of causation. In general, a covered claimant suffering from an occupational disease is automatically paid benefits. However, although cerebro-vascular accident and essential hypertension are listed occupational diseases, their compensability requires compliance with all the conditions set forth in the Rules. In short, both are qualified occupational diseases. For cerebro-vascular accident, the claimant must prove the following: (1) there must be a history, which should be proved, of trauma at work (to the head specifically) due to unusual and extraordinary physical or mental strain or event, or undue exposure to noxious gases in industry; (2) there must be a direct connection between the trauma or exertion in the course of the employment and the cerebro-vascular attack; and (3) the trauma or exertion then and there caused a brain hemorrhage. On the other hand, essential hypertension is compensable only if it causes impairment of function of body organs like kidneys, heart, eyes and brain, resulting in permanent disability, provided that, the following documents substantiate it: (a) chest X-ray report; (b) ECG report; (c) blood chemistry report; (d) funduscopy report; and (e) C-T scan. EMPLOYEE STATUS

 Manalo, et. al. vs . TNS Philippines , Inc ., G .R . No. 208567, November 26, 2014 1. Regular employees, not project employees; project employment scheme circumvented the law and prevented employees from attaining regular status. In Maraguinot, Jr. v. NLRC , the Court held that once a project or work pool employee has been: (1) continuously, as opposed to intermittently, rehired by the same employer for the same tasks or nature of tasks; and (2) these tasks are vital, necessary and indispensable to the usual business or trade of the employer, then the employee must be deemed a regular employee. Granting arguendo that petitioners were rehired intermittently, a careful review of the project employment contracts of petitioners reveals some other vague provisions. Oddly, one of the terms and conditions in the said contract stated that: 1. The need for your services being determinable and for a specific project starting ____________ your employment will be for the duration of said project of the Company, namely Project ___________ which is expected to be finished on _____________. The Company shall have the option of renewing or extending the period of this agreement for such time as it may be necessary to complete the project or

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because we need further time to determine your competence on the job . To the Court, the phrase “because we ne ed further time to determine your competence on the job” would refer to a probationary employment. Such phrase changes the tenor of the contract and runs counter to the very nature of a project employment. TNS can, therefore, extend the contract which was already fixed when it deemed it necessary to determine whether or not the employee was qualified and fit for the job. Corollarily, TNS can likewise pre-terminate the contract not because the specific project was completed ahead of time, but because of failure to qualify for the job. Consistently, the terms and conditions of the contract read:

4. It is expressly agreed and understood that the Company may terminate your employment after compliance with procedural requirements of law, without benefit of termination pay and without any obligation on the part of the Company, in the event of any breach of any conditions hereof: a) If the project is completed or cancelled before the expected date of completion as specified in paragraph 1 hereof; b) If we should find that you are not qualified, competent or efficient in the above-stated positions for which you are hired in accordance with the company standards made known to you at the start of your employment ; x x x For said reason, at the outset, the supposed project employment contract was highly doubtful. In determining the true nature of an employment, the entirety of the contract, not merely its designation or by which it was denominated, is controlling. Though there is a rule that conflicting provisions in a contract should be harmonized to give effect to all, in this case, however, harmonization is impossible because project employment and probationary employment are distinct from one another and cannot coexist with each other. Hence, should there be ambiguity in the provisions of the contract, the rule is that all doubts, uncertainties, ambiguities and insufficiencies should be resolved in favor of labor. This is in consonance with the constitutional policy of providing full protection to labor. EXECUTION

Philippine A irlines, I nc. vs . Paz, G.R . No. 192924, November 26, 2014 1. When delay in execution of reinstatement pending appeal not attributable to the employer but because of the constraints of corporate rehabilitation, thus pilot not entitled to reinstatement salaries. The rule is that the employee is entitled to reinstatement salaries notwithstanding the reversal of the LA decision granting him said relief. In Roquero v. Philippine Airlines , the Court underscored that it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court. This is so because the order of reinstatement is immediately executory. Unless there is a restraining order issued, it is ministerial upon the LA to implement the order of reinstatement. The unjustified refusal of the employer to reinstate a dismissed employee entitles him to payment of his salaries effective from the time the employer failed to reinstate him. In light of the fact that PAL's failure to comply with the reinstatement order was  justified by the exigencies of corporation rehabilitation, the respondent may no longer claim salaries which he should have received during the period that the LA decision ordering his reinstatement is still pending appeal until it was overturned by the NLRC. Thus, the CA committed a reversible error in recognizing the respondent's right to collect reinstatement salaries albeit suspending its execution while PAL is still under corporate rehabilitation.

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 Manalo, et. al. vs . TNS Philippines , Inc ., G .R . No. 208567, November 26, 2014 1. Illegally dismissed employees entitled to backwages and separation pay.  Accordingly, as correctly ruled by the NLRC, each petitioner is entitled to backwages from the time of their dismissal up to the finality or this decision plus separation pay, following their prayer for such relief in lieu of reinstatement, computed as follows as of May 29, 2009: a) Backwages: October 21, 2008 to May 29, 2009 = 7.27 mos. P382.00 x 26 days x 7.27 mos. = b) Separation Pay: December 1, 2008 to May 29, 2009 = 5.93 mos. P382.00 x 26 days x 5.03 mps./12

P72, 205.64

= P4 908.10 P77,113.80

SUPPLEMENT NO. 005 ATTORNEY’S FEES

 Montierr o vs . R ic kmers Marine A g ency Phils. Inc., G .R . No. 210634, J anuary 14,  2015 1. Seafarer not entitled to any attorney’s fees as there was no unlawful

withholding of benefits; he jumped the gun when he filed his complaint one month before the company-designated doctor issued the final disability grading. On the premise that there was no showing of bad faith on the part of the employer, forcing Montierro to litigate, the CA dropped the award of attorney’s fees. We arrive at the same conclusion by using another route. Indeed, the general rule is that attorney's fees may not be awarded where there is no sufficient showing of bad faith in a party's persistence in a case other than an erroneous conviction of the righteousness of one’s cause. The rule, however, ta kes a turn when it comes to labor cases. The established rule in labor law is that the withholding of wages need not be coupled with malice or bad faith to warrant the grant of attorney’s fees under Article 111 of the Labor Code. All that is required is that lawful wages be not paid without  justification, thus compelling the employee to litigate. The CA thus relied on a wrong consideration in resolving the issue of attorney’s fees. Be that as it may, Montierro is not entitled to attorney’s fees, even if we apply the correct rule to this case.

EMPLOYEE COMPENSATION

 Montierr o vs . R ic kmers Marine A g ency Phils. Inc., G .R . No. 210634, J anuary 14,  2015 1. 240-day rule applicable over the 120-day rule as complaint was filed after promulgation of the Vergara vs. Hammonia Maritime  case; final disability assessment issued before the expiry of the 240 day period, thus the seafarer’s

condition cannot be considered total permanent disability.

8 The Court has already delineated the effectivity of the Crystal Shipping and Vergara rulings in the 2013 case Kestrel Shipping Co. Inc. v. Munar, by explaining as follows: Nonetheless, Vergara was promulgated on October 6, 2008, or more than two (2) years from the time Munar filed his complaint and observance of the principle of prospectivity dictates that Vergara should not operate to strip Munar of his cause of action for total and permanent disability that had already accrued as a result of his continued inability to perform his customary work and the failure of the company-designated physician to issue a final assessment. Thus, based on Kestrel, if the maritime compensation complaint was filed prior to 6 October 2008, the 120-day rule applies; if, on the other hand, the complaint was filed from 6 October 2008 onwards, the 240-day rule applies. 2. Assessment of company-designated physician upheld over the one (1) page assessment of the seafarer’s personal physician (Dr. Jacinto).

Vergara ruled that the procedure in the 2000 POEA-SEC must be strictly followed; otherwise, if not availed of or followed strictly by the seafarer, the assessment of the company-designated physician stands. xxx Having extensive personal knowledge of the seafarer's actual medical condition, and having closely, meticulously and regularly monitored and treated his injury for an extended period, the companydesignated physician is certainly in a better position to give a more accurate evaluation of Montierro's health condition. The disability grading given by him should therefore be given more weight than the assessment of Montierro's physician of choice. SUPPLEMENT NO. 006 ABANDONMENT

 Manarpiis vs . Texan P hilippines , Inc ., G .R . No. 197011, J anuary 28, 2015 1. When there is no abandonment. While the introduction of additional evidence before the NLRC is not proscribed, the said tribunal was still not persuaded by the company closure purportedly averted only by the alleged fresh funding procured by respondent Tan, for the latter claim remained unsubstantiated. The CA’s finding of serious business losses is not borne by the evidence on record. The financial statements supposedly bearing the stamp mark of BIR were not signed by an independent auditor. Besides, the non-compliance with the requirements under Article 283 of the Labor Code, as amended, gains relevance in this case not for the purpose of proving the illegality of the company closure or cessation of business, which did not materialize, but as an indication of bad faith on the part of respondents in hastily terminating petitioner’s employment. Under the circumstances, the subsequent investigation and termination of petitioner on grounds of dishonesty, loss of confidence and abandonment of work, clearly appears as an afterthought as it was done only after petitioner had filed an illegal dismissal case and respondents have been summoned for hearing before the LA.  Abandonment in this case was a trumped up charge, apparently to make it appear that petitioner was not yet terminated when she filed the illegal dismissal complaint and to give a semblance of truth to the belated investigation against the petitioner. Petitioner did not abandon her work but was told not to report for work

9 anymore after being served a written notice of termination of company closure on July 27, 2000 and turning over company properties to respondent Rialubin-Tan. APPEAL

One S hipping C orp. vs . Penafiel, G .R . No. 192406, J anuary 21, 2015 1. Court of Appeals properly ruled on the merits of the case even if the NLRC decision had already become final after the lapse of ten days, as the petition was filed within the sixty (60) day period for filing a petition for certiorari under Rule 65. In Aliviado v. Procter and Gamble Phils., Inc ., it was held: It is a hornbook rule that once a judgment has become final and executory, it may no longer be modified in any respect, even if the modification is meant to correct an erroneous conclusion of fact or law, and regardless of whether the modification is attempted to be made by the court rendering it or by the highest court of the land, as what remains to be done is the purely ministerial enforcement or execution of the judgment… The only exceptions to the rule on the immutability of final judgments are (1) the correction of clerical errors, (2) the so-called nunc pro tunc entries which cause no prejudice to any party, and (3) void judgments. Nunc pro tunc judgments have been defined and characterized by the Court in the following manner: Section A of Rule VII of the NLRC Rules of Procedure provides that “except as provided in Section 9 of Rule X, the decisions, resolutions or orders of the Commission shall become final and executory after ten (10) calendar days from receipt thereof by the parties. Section B of the same Rules provides that “upon the expiration of the ten (10) calendar days period provided in paragraph (a) of this Section, the decision, resolution, or order shall be entered in a book of entries of judgment.”

2. Filing of petition for certiorari does not interrupt the course of the principal case. Section 7 of Rule 65 provides: Sec. 7. Expediting proceedings; Injunctive relief. - The court in which the petition is filed may issue orders expediting the proceedings, and it may also grant a temporary restraining order or a writ of preliminary injunction for the preservation of the rights of the parties pending such proceedings. The petition shall not interrupt the course of the principal case unless a temporary restraining order or a writ of preliminary injunction has been issued enjoining the public respondent from further proceeding with the case. The public respondent shall proceed with the principal case within ten (10) days from the filing of a petition for certiorari with a higher court or tribunal absent a temporary restraining order or a preliminary injunction, or upon its expiration. EMPLOYEE COMPENSATION

Unicol Manag ement S ervices , Inc . vs . Malipot, G .R . No. 206562, J anuary 21, 2015 1. Seafarer proven to have committed suicide.

10 The Medico-Legal Report and the Death Certificate, together with the Investigation Report, log book extracts, and Master’s Report substantially prove that seaman Glicerio’s death was attributable to his deliberate act of killing himself by committing suicide. 2. Seafarer’s heirs not entitled to any death benefits as the seafarer committed

suicide. Section 20 of the POEA “ Standard Terms and Conditions Governing the Overseas Employment of Filipino Seafarers On-Board Ocean-Going Ships ,” provides:

x

x

x

B. COMPENSATION AND BENEFITS FOR DEATH xxx D. No compensation and benefits shall be payable in respect of any injury, incapacity, disability or death of the seafarer resulting from his willful or criminal act or intentional breach of his duties, provided however, that the employer can prove that such injury, incapacity, disability or death is directly attributable to the seafarer. Clearly, the employer is liable to pay the heirs of the deceased seafarer for death benefits once it is established that he died during the effectivity of his employment contract. However, the employer may be exempt from liability if it can successfully prove that the seaman’s death was caused by an injury directly attributable to his deliberate or willful act. EVIDENCE 1. NLRC may receive evidence even on appeal. In Sasan, Sr. v. National Labor Relations Commission 4th Division, it was held that jurisprudence is replete with cases allowing the NLRC to admit evidence, not presented before the Labor Arbiter, and submitted to the NLRC for the first time on appeal. The submission of additional evidence before the NLRC is not prohibited by its New Rules of Procedure considering that rules of evidence prevailing in courts of law or equity are not controlling in labor cases. The NLRC and Labor Arbiters are directed to use every and all reasonable means to ascertain the facts in each case speedily and objectively, without regard to technicalities of law and procedure all in the interest of substantial justice. In keeping with this directive, it has been held that the NLRC may consider evidence, such as documents and affidavits, submitted by the parties for the first time on appeal. Moreover, among the powers of the Commission as provided in Section 218 of the Labor Code is that the Commission may issue subpoenas requiring the attendance and testimony of witnesses or the production of such books, papers, contracts, records, statement of accounts, agreements, and others. In addition, the Commission may, among other things, conduct investigation for the determination of a question, matter or controversy within its jurisdiction, proceed to hear and determine the disputes in the absence of any party thereto who has been summoned or served with notice to appear, conduct its proceedings or any part thereof in public or in private, adjourn its hearings to any time and place, refer technical matters or accounts to an expert and to accept his report as evidence after hearing of the parties upon due notice. From the foregoing, it can be inferred that the NLRC can receive evidence on cases appealed before the Commission, otherwise, its factual conclusions would not have been given great respect, much weight, and relevance when an adverse party assails the decision of the NLRC via petition for certiorari under Rule 65 of the Rules of Court before the CA and then to this Court via a petition for review under Rule 45.

11 SUPPLEMENT NO. 007 APPEAL Leus vs. St. Scholastica’s College Westgrove, G.R. No. 187225, January 28, 2015 

1. Issue on the validity of the 1992 Manual of Regulations for Private Schools (1992 MRPS) cannot be raised for the first time before the Supreme Court. The petitioner contends that the CA, in ruling that there was a valid ground to dismiss her, erred in applying Section 94 of the 1992 MRPS. Essentially, she claims that the 1992 MRPS was issued by the Secretary of Education as the revised implementing rules and regulations of Batas Pambansa Bilang 232 (BP 232) or the “Education Act of 1982.” That there is no provision in BP 232, which provides for the grounds for the termination of employment of teaching and non-teaching personnel of private schools. Thus, Section 94 of the 1992 MRPS, which provides for the causes of terminating an employment, is invalid as it “widened the scope and coverage” of BP 232. The Court does not agree. The Court notes that the argument against the validity of the 1992 MRPS, specifically Section 94 thereof, is raised by the petitioner for the first time in the instant petition for review. Nowhere in the proceedings before the LA, the NLRC or the CA did the petitioner assail the validity of the provisions of the 1992 MRPS. “It is well established that issues raised for the first time on appeal and not raised in the proceedings in the lower court are barred by estoppel. Points of law, theories, issues, and arguments not brought to the attention of the trial court ought not to be considered by a reviewing court, as these cannot be raised for the first time on appeal. To consider the alleged facts and arguments belatedly raised would amount to trampling on the basic principles of fair play, justice, and due process.”

ATTORNEY’S FEES

Eyana vs. Philippine Transmarine Carriers, Inc., G.R. No. 193468, January 28,  2015 1. When seafarer entitled to attorney’s fees, but the same is reduced to P1,000.00 as the acts of respondents did not evince bad faith and they did not completely shirk from their duties to the seafarer. The petitioner is entitled to attorney’s fees pursuant to Article 2208(8) of the Civil Code. The Court, however, notes that the respondents provided the petitioner with medical treatment and offered to pay him disability benefits, albeit in the reduced amount. In other words, the acts of the respondents did not evince bad faith. The respondents did not completely shirk from their duties to the petitioner. Although the petitioner was still thus compelled to litigate to be entitled to total and permanent disability compensation, the Court finds the award of attorney’s fees in the amount of US$1,000.00 as reasonable.

DAMAGES Leus vs. St. Scholastica’s College Westgrove, G.R. No. 187225, January 28, 2015 

1. When damages are not awarded in the absence of bad faith. “A dismissed employee is entitled to moral damages when the dismissal is attended by bad faith or fraud or constitutes an act oppressive to labor, or is done in a manner contrary to good morals, good customs or public policy. Exemplary damages

12 may be awarded if the dismissal is effected in a wanton, oppressive or malevolent manner.” “Bad faith, under the law, does not simply connote bad judgment or negligence. It imports a dishonest purpose or some moral obliquity and conscious doing of a wrong, or a breach of a known duty through some motive or interest or ill will that partakes of the nature of fraud.” “It must be noted that the burden of proving bad faith rests on the one alleging it” since basic is the principle that good faith is presumed and he who alleges bad faith has the duty to prove the same. “Allegations of bad faith and fraud must be proved by clear and convincing evidence.”

The records of this case are bereft of any clear and convincing evidence showing that the respondents acted in bad faith or in a wanton or fraudulent manner in dismissing the petitioner. That the petitioner was illegally dismissed is insufficient to prove bad faith. A dismissal may be contrary to law but by itself alone, it does not establish bad faith to entitle the dismissed employee to moral damages. The award of moral and exemplary damages cannot be justified solely upon the premise that the employer dismissed his employee without cause. EMPLOYEE COMPENSATION (NOTE: 2010 POEA-SEC VS. 1996 POEA-SEC)

C .F. S harp C rew Manag ement, Inc. vs . P erez, G .R . No. 194885, J anuary 26, 2015 1. Under the 1996 POEA Standard Employment Contract, it is enough that the seafarer suffered his illness or injury during the term of his employment contract for the same to be compensable. The 1996 POEA-SEC reads: SECTION 20. COMPENSATION AND BENEFITS xxx B. COMPENSATION AND BENEFITS FOR INJURY OR ILLNESS The liabilities of the employer when the seafarer suffers injury or illness during the term of his contract are as follows: xxx We have ruled that under the 1996 POEA-SEC, it is enough that the seafarer proves that his or her injury or illness was acquired during the term of employment to support a claim for disability benefits. Note: Under the 2010 POEA-SEC, injury or illness must be (a) work-connected; (b) acquired during the term of employment. 2. No provision in the 1996 POEA Standard Employment Contract on concealment of pre-existing medical condition.

C .F. S harp C rew Manag ement, Inc. vs . Perez, G .R . No. 194885, J anuary 26, 2015 We disagree with petitioners that respondent is not entitled to disability benefits because he is guilty of fraud in concealing his pre-existing medical condition. Petitioners cannot rely on Section 20(E) of the 2000 POEA-SEC since, as discussed above, it is the 1996 POEA-SEC that is applicable to the instant case. Section 20(E) of the 1996 POEA-SEC provides:

13 E. When requested, the seafarer shall be furnished a copy of all pertinent medical reports or records at no cost to the seafarer. The above-quoted provision does not mention concealment. It only requires that the seafarer be furnished a copy of all pertinent medical records upon request. On this point, the NLRC appears to have been misled in ruling that respondent is guilty of concealment. Note: Under the 2010 POEA-SEC, there is a provision of concealment. 3. Seafarer’s psychotic disorder considered a permanent total disability under the

1996 POEA Standard Employment Contract as there is no finding that he was fit to work nor a declaration as to his disability grading. The evidence on record likewise bel ies petitioners’ claim that respondent was eventually declared fit to work by their designated doctors. Notably, Dr. Reyes and Dr.  Abesamis both found respondent to be suffering from recurrent acute psychotic disorder. Dr. Reyes said that respondent’s psyc hotic disorder will become manifest once triggered by an outside factor, while Dr. Abesamis said that recurrence of the same psychotic disorder is possible. Dr. Abesamis even signed a medical certificate, SSS Form MMD-102, supporting respondent’s claim for   disability benefits before the SSS. In said medical certificate, Dr. Abesamis indicated her final diagnosis: respondent has acute psychotic disorder, recurrent. Hence, petitioners cannot claim that their designated doctors declared respondent as fit to work after his repatriation and treatment. Without a declaration that respondent is already fit to work or an assessment of the degree of respondent’s disability by petitioners’ own doctors, respondent’s disability is therefore permanent and total. This is equivalent to a Grade 1 impediment/disability entitling respondent to US$60,000 as permanent and total disability benefits under the 1996 POEA-SEC. 4. Seafarer’s psychotic disorder not a result of an accident, thus the CBA is not

applicable and the seafarer is entitled only to US$60,000.00 under the 1996 POEA Standard Employment Contract.  Accident is an unintended and unforeseen injurious occurrence; something that does not occur in the usual course of events or that could not be reasonably anticipated; an unforeseen and injurious occurrence not attributable to mistake, negligence, neglect or misconduct. Accident is that which happens by chance or fortuitously, without intention and design, and which is unexpected, unusual and unforeseen. IMMORALITY Leus vs. St. Scholastica’s College Westgrove, G.R. No. 187225, January 28, 2015 

1. The labor tribunals’ respective conclusions that the petitioner’s pregnancy is a “disgraceful or immoral conduct” were arrived at arbitrarily.

The CA and the labor tribunals affirmed the validity of the petitioner’s dismissal pursuant to Section 94(e) of the 1992 MRPS, which provides that: Sec. 94. Causes of Terminating Employment  –  In addition to the just causes enumerated in the Labor Code, the employment of school personnel, including faculty, may be terminated for any of the following causes: xxx e. Disgraceful or immoral conduct; xxx

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The labor tribunals concluded that the petitioner’s pregnancy out of wedlock, per se, is “disgraceful and immoral” consideri ng that she is employed in a Catholic educational institution. In arriving at such conclusion, the labor tribunals merely assessed the fact of the petitioner’s pregnancy vis -à-vis the totality of the circumstances surrounding the same.

However, the Court finds no substantial evidence to support the aforementioned conclusion arrived at by the labor tribunals. The fact of the petitioner’s pregnancy out of wedlock, without more, is not enough to characterize the petitioner’s conduct as disgraceful or immoral. There must be substantial evidence to establish that pre-marital sexual relations and, consequently, pregnancy out of wedlock, are indeed considered disgraceful or immoral. 2. The totality of the circumstances surrounding the conduct alleged to be disgraceful or immoral must be assessed against the prevailing norms of conduct. In Chua-Qua v. Clave, the Court stressed that to constitute immorality, the circumstances of each particular case must be holistically considered and evaluated in light of the prevailing norms of conduct and applicable laws. Otherwise stated, it is not the totality of the circumstances surrounding the conduct per se that determines whether the same is disgraceful or immoral, but the conduct that is generally accepted by society as respectable or moral. If the conduct does not conform to what society generally views as respectable or moral, then the conduct is considered as disgraceful or immoral. Tersely put, substantial evidence must be presented, which would establish that a particular conduct, viewed in light of the prevailing norms of conduct, is considered disgraceful or immoral. Thus, the determination of whether a conduct is disgraceful or immoral involves a two-step process: first, a consideration of the totality of the circumstances surrounding the conduct; and second, an assessment of the said circumstances vis-à-vis the prevailing norms of conduct, i.e., what the society generally considers moral and respectable. 3. Public and secular morality should determine the prevailing norms of conduct, not religious morality. In Estrada v. Escritor , an administrative case against a court interpreter charged with disgraceful and immoral conduct, the Court stressed that in determining whether a particular conduct can be considered as disgraceful and immoral, the distinction between public and secular morality on the one hand, and religious morality, on the other, should be kept in mind. That the distinction between public and secular morality and religious morality is important because the jurisdiction of the Court extends only to public and secular morality. 4. The petitioner’s pregnancy out of wedlock is not a disgraceful or immoral conduct since she and the father of her child have no impediment to marry each other. Viewed against the prevailing norms of conduct, the petitioner’s conduct cannot be considered as disgraceful or immoral; such conduct is not denounced by public and secular morality. It may be an unusual arrangement, but it certainly is not disgraceful or immoral within the contemplation of the law. To stress, pre-marital sexual relations between two consenting adults who have no impediment to marry each other, and, consequently, conceiving a child out of wedlock, gauged from a purely public and secular view of morality, does not amount to a disgraceful or immoral conduct under Section 94(e) of the 1992 MRPS.

15 6. There is no substantial evidence to prove that the petitioner’s pregnancy out of

wedlock caused grave scandal to SSCW and its students. Other than the SSCW’s bare allegation, the records are bereft of any evidence that would convincingly prove that the petitioner’s conduct indeed adversely affected SSCW’s integrity in teaching the moral doctrines, which it stands for. The petitioner is only a non-teaching personnel; her interaction with SSCW’s students is very limited. It is thus quite impossible that her pregnancy out of wedlock caused such a grave scandal, as claimed by SSCW, as to warrant her dismissal. SUPPLEMENT NO. 008 POEA-SEC

Veri tas Maritime Corporation vs . G epanag a, J r., G .R . No. 206285, February 4, 2015 1.

In Philippine Hammonia v. Dumadag, it was held: Given the circumstances under which Dumadag pursued his claim, especially the fact that he caused the non-referral to a third doctor, Dr. Dacanay’s fit -to-work certification must be upheld. In Santiago v. Pacbasin Ship Management, Inc. , the Court declared: "[t]here was no agreement on a third doctor who shall examine him anew and whose finding shall be final and binding. x x x [T]his Court is left without choice but to uphold the certification made by Dr. Lim with respect to Santiago’s disability."

2. Seafarer’s claims premature as when he filed his complaint, he had yet to consult his own physician.  A seafarer may have basis to pursue an action for total and permanent disability benefits, if any of the following conditions is present: (a) The company-designated physician failed to issue a declaration as to his fitness to engage in sea duty or disability even after the lapse of the 120-day period and there is no indication that further medical treatment would address his temporary total disability, hence, justify an extension of the period to 240 days; (b) 240 days had lapsed without any certification issued by the company designated physician; (c) The company-designated physician declared that he is fit for sea duty within the 120-day or 240-day period, as the case may be, but his physician of choice and the doctor chosen under Section 20-B(3) of the POEA-SEC are of a contrary opinion; (d) The company-designated physician acknowledged that he is partially permanently disabled but other doctors who he consulted, on his own and jointly with his employer, believed that his disability is not only permanent but total as well; (e) The company-designated physician recognized that he is totally and permanently disabled but there is a dispute on the disability grading; (f) The company-designated physician determined that his medical condition is not compensable or work-related under the POEA-SEC but his doctor-of-choice and the third doctor selected under Section 20-B(3) of the POEA-SEC found otherwise and declared him unfit to work; (g) The company-designated physician declared him totally and permanently disabled but the employer refuses to pay him the corresponding benefits; and (h) The company-designated physician declared him partially and permanently disabled within the 120-day or 240-day period but he remains incapacitated to perform his usual sea duties after the lapse of said periods.

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When Gepanaga filed his complaint on March 25, 2009, he had yet to consult his own physician, Dr. Villa. Indeed, the Court has observed that when Gepanaga filed his complaint, he was armed only with the belief that he had yet to fully recover from his injured finger because of the incident that occurred on board the M.V. Melbourne Highway. It was only on June 9, 2009, a few days before he filed his position paper on June 15, 2009, that Gepanaga sought the services of Dr. Villa. 3. Seafarer’s physician only examined him for one (1) day and failed to state the

basis of his assessment and conclusion of permanent disability. It bears pointing out that even worse than the case in Dumadag, Gepanaga's personal physician examined him for only one (1) day, that is, on June 9, 2009, two and a half months (2 ½)after he had filed his claim for permanent disability benefits. Furthermore, the medical certificate issued by Dr. Villa after examining the respondent failed to state the basis of his assessment and conclusion of permanent disability, more than three (3) months after the respondent was declared fit to work by Dr. Cruz, the company-designated physician. 4. Seafarer’s inability to resume his work after the lapse of 120 days is not a

magic wand that automatically warrants the grant of total and permanent disability benefits in his favor. Let it be stressed that the seafarer's inability to resume his work after the lapse of more than 120 days from the time he suffered an injury and/or illness is not a magic wand that automatically warrants the grant of total and permanent disability benefits in his favor. Both law and evidence must be on his side. SUPPLEMENT NO. 009 APPEAL

 Milan, et. al. vs . National Labor R elations C ommis s ion, G .R . No. 202961, F ebruary 4, 2015 1. Claim for retirement benefits was not included in the complaint and hence cannot be raised on appeal. Teodora Mahilom’s claim for retirement benefits was not included in her complaint filed before the Labor Arbiter. Hence, it may not be raised in the appeal.

2. Employer has the right to require clearance before the release of last payments to the employee; an employer is allowed to withhold terminal pay and benefits pending the employee's return of its properties; employer’s withholding of terminal pay and other benefits pending the employees’ vacating properties it

owns thus valid.  As an exception to the general rule that wages may not be withheld and benefits may not be diminished, the Labor Code provides:  Art. 113. Wage deduction.No employer, in his own behalf or in behalf of any person, shall make any deduction from the wages of his employees, except: 1. In cases where the worker is insured with his consent by the employer, and the deduction is to recompense the employer for the amount paid by him as premium on the insurance; 2. For union dues, in cases where the right of the worker or his union to check-off has been recognized by the employer or authorized in writing by the individual worker concerned; and

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3. In cases where the employer is authorized by law or regulations issued by the Secretary of Labor and Employment.

(Emphasis supplied) The Civil Code provides that the employer is authorized to withhold wages for debts due:  Article 1706. Withholding of the wages, except for a debt due, shall not be made by the employer. “Debt” in this case refers to any obligation due from the employee to the employer. It includes any accountability that the employee may have to the employer. There is no reason to limit its scope to uniforms and equipment, as petitioners would argue.

3. The preferential treatment given by our law to labor is not a license for abuse; it is not a signal to commit acts of unfairness that will unreasonably infringe on the property rights of the company. Our laws provide for a clear preference for labor. This is in recognition of the asymmetrical power of those with capital when they are left to negotiate with their workers without the standards and protection of law. In cases such as these, the collective bargaining unit of workers are able to get more benefits and in exchange, the owners are able to continue with the program of cutting their losses or wind down their operations due to serious business losses. The company in this case did all that was required by law. JURISDICTION 1. The National Labor Relations Commission has jurisdiction to determine, preliminarily, the part ies’ rights over a property, when it is necessary to determine an issue related to rights or claims arising from an employer-employee relationship; the return of its properties in petitioners’ possession by virtue of

their status as employees is an issue that must be resolved to determine whether benefits can be released immediately and thus said issue is intertwined with employer-employee relationship and the labor tribunals thus have jurisdiction. Claims arising from an employer-employee relationship are not limited to claims by an employee. Employers may also have claims against the employee, which arise from the same relationship. 2. Employee no longer entitled to any separation benefits as she retired long before the closure of the company. SUPPLEMENT NO. 010 DUE PROCESS

 Maers k-Filipi nas C rewi ng , Inc . vs . A ves truz, G .R . No. 207010, February 18, 2015 1. Invalidly dismissed seafarer not afforded due process. Similarly, the Court affirms the finding of the CA that Avestruz was not accorded procedural due process, there being no compliance with the provisions of Section 17 of the POEA-SEC as above-cited, which requires the “two -notice rule.” As explained in Skippers Pacific, Inc. v. Mira :  An erring seaman is given a written notice of the charge against him and is afforded an opportunity to explain or defend himself. Should sanctions be imposed, then a written notice of penalty and the reasons for

18 it shall be furnished the erring seafarer. It is only in the exceptional case of clear and existing danger to the safety of the crew or vessel that the required notices are dispensed with; but just the same, a complete report should be sent to the manning agency, supported by substantial evidence of the findings. The statement given by Captain Woodward requiring him to explain in writing the events that transpired at the galley in the morning of June 22, 2011 hardly qualifies as a written notice of the charge against him, nor was it an opportunity for Avestruz to explain or defend himself. While Captain Woodward claimed in his e-mail that he conducted a “disciplinary hearing” informing Avestruz of his inefficiency, no evidence was presented to support the same. Neither was Avestruz given a written notice of penalty and the reasons for its imposition. Instead, Captain Woodward verbally informed him that he was dismissed from service and would be disembarked from the vessel. EMPLOYEE STATUS

B as an, et. al. vs . C oca-Cola B ottlers Philippines , G .R . No. 174365-66, F ebruary 4,  2015 1. Route helpers hired by Coca Cola Bottlers Philippines, Inc. considered regular employees. The argument of petitioner that its usual business or trade is softdrink manufacturing and that the work assigned to respondent workers as sales route helpers so involves merely "postproduction activities," one which is not indispensable in the manufacture of its products, scarcely can be persuasive. If, as so argued by petitioner company, only those whose work are directly involved in the production of softdrinks may be held performing functions necessary and desirable in its usual business or trade, there would have then been no need for it to even maintain regular truck sales route helpers. The nature of the work performed must be viewed from a perspective of the business or trade in its entirety and not on a confined scope. The repeated rehiring of respondent workers and the continuing need for their services clearly attest to the necessity or desirability of their services in the regular conduct of the business or trade of petitioner company. The Court of Appeals has found each of respondents to have worked for at least one year with petitioner company. While this Court, in Brent School, Inc. vs. Zamora , has upheld the legality of a fixedterm employment, it has done so, however, with a stern admonition that where from the circumstances it is apparent that the period has been imposed to preclude the acquisition of tenurial security by the employee, then it should be struck down as being contrary to law, morals, good customs, public order and public policy. The pernicious practice of having employees, workers and laborers, engaged for a fixed period of few months, short of the normal six-month probationary period of employment, and, thereafter, to be hired on a day-to-day basis, mocks the law. Any obvious circumvention of the law cannot be countenanced. 2. Doctrine of s tare decis is et non qui eta mover e . In fact, in Pacquing, et. al. v. Coca-Cola Philippines, Inc ., this Court applied the ruling cited above under the principle of stare decisis et non quieta movere (follow past precedents and do not disturb what has been settled). It was held therein that since petitioners, as route helpers, were performing the same functions as the employees in Magsalin, which are necessary and desirable in the usual business or trade of Coca Cola Philippines, Inc., they are considered as regular employees entitled to security of tenure. 3. When all the petitioners share a common interest and invoke a common cause of action or defense, the signature of only one of them in the certification against forum shopping substantially complies with the certification requirement.

19 Jurisprudence is replete with rulings that the rule on verification is deemed substantially complied with when one who has ample knowledge to swear to the truth of the allegations in the complaint or petition signs the verification, and when matters alleged in the petition have been made in good faith or are true and correct. Similarly, this Court has consistently held that when under reasonable or justifiable circumstances, as when all the petitioners share a common interest and invoke a common cause of action or defense, as in this case, the signature of only one of them in the certification against forum shopping substantially complies with the certification requirement. TERMINATION

 Maers k-Filipi nas C rewi ng , Inc . vs . A ves truz, G .R . No. 207010, February 18, 2015 1. No insubordination on the part of the seafarer proven. Petitioners maintain that Avestruz was dismissed on the ground of insubordination, consisting of his “repeated failure to obey his superior’s order to maintain cleanliness in the galley of the vessel” as well as his act of “insulting a superior officer by words or deeds.” ( insubordination) In support of this contention, petitioners presented as evidence the e-mails sent by Captain Woodward, both dated June 22, 2011, and time-stamped 10:07 a.m. and 11:40 a.m., respectively, which they claim chronicled the relevant circumstances that eventually led to Avestruz’s dismissal. In this case, the contents of Capt ain Woodward’s e -mails do not establish that  Avestruz’s conduct had been willful, or characterized by a wrongful and perverse attitude. The Court concurs with the CA’s observation that Avestruz’s statementregarding the incident in the galley deserves more credence, being corroborated by Kong, a messman who witnessed the same. SUPPLEMENT NO. 011 ATTORNEY’S FEES

Hocheng Philippines C orporation vs . Farrales, G .R . No. 211497, March 18, 2015 1. When attorney’s fees are awarded.

But concerning the award of attorney’s fees, Farrales was dismissed for a flimsy charge, and he was compelled to litigate to secure what is due him which HPC unjustifiably withheld. 2. When damages are not awarded. There is no satisfactory proof that the concerned officers of HPC acted in bad faith or with malice in terminating Farrales. Notwithstanding the LA’s assertion to this effect, Farrales’ bare allegations of bad faith deserve no credence, and neither is the mere fact that he was illegally dismissed sufficient to prove bad faith on the part of HPC’s officers. But concerning the award of attorney’s fees, Farrales was dismissed for a flimsy charge, and he was compelled to litigate to secure what is due him which HPC unjustifiably withheld. EMPLOYEE STATUS

Fonterra B rands Phils. Inc . vs . Larg ado, G.R . No. 205300, March 18, 2015 1. Fixed term employee status valid.

20 Foremost, respondents were fixed-term employees. As previously held by this Court, fixed-term employment contracts are not limited, as they are under the present Labor Code, to those by nature seasonal or for specific projects with predetermined dates of completion ; they also include those to which the parties by free choice have assigned a specific date of termination. The determining factor of such contracts is not the duty of the employee but the day certain agreed upon by the parties for the commencement and termination of the employment relationship . In the case at bar, it is clear that respondents were employed by A.C. Sicat as project employees. In their employment contract with the latter, it is clearly stated that “[A.C. Sicat is] temporarily employing [respondents] as TMR[s] effective June 6[, 2006] under the following terms and conditions: The need for your service being only for a specific project, your temporary employment will be for the duration only of said project of our client, namely to promote FONTERRA BRANDS products x x x which is expected to be finished on or before Nov. 06, 2006.” 2. Contractor considered a legitimate job contractor.  A person is considered engaged in legitimate job contracting or subcontracting if the following conditions concur: 1. The contractor or subcontractor carries on a distinct and independent business and undertakes to perform the job, work or service on its own account and under its own responsibility according to its own manner and method, and free from the control and direction of the principal in all matters connected with the performance of the work except as to the results thereof; 2. The contractor or subcontractor has substantial capital or investment; and 3. The agreement between the principal and contractor or subcontractor assures the contractual employees entitlement to all labor and occupational safety and health standards, free exercise of the right to self-organization, security of tenure, and social and welfare benefits.  A.C. Sicat was able to prove its status as a legitimate job contractor for having presented the following evidence, to wit: 1. Certificate of Business Registration; 2. Certificate of Registration with the Bureau of Internal Revenue; 3. Mayor’s Permit; 4. Certificate of Membership with the Social Security System; 5. Certificate of Registration with the Department of Labor and Employment; 6. Company Profile; and 7. Certifications issued by its clients. Furthermore, A.C. Sicat has substantial capital, having assets totaling  _5,926,155.76 as of December 31, 2006. Too, its Agreement with Fonterra clearly sets forth that A.C. Sicat shall be liable for the wages and salaries of its employees or workers, including benefits, premiums, and protection due them, as well as remittance to the proper government entities of all withholding taxes, Social Security Service, and Medicare premiums, in accordance with relevant laws. The appellate court further correctly held that Fonterra’s issuance of Merchandising Guidelines, stock monitoring and inventory forms, and promo mechanics, for compliance and use of A.C. Sicat’s employees assigned to them, does not establish that Fonterra exercises control over A.C. Sicat. These were imposed only to ensure the effectiveness of the promotion services to be rendered by the merchandisers as it would be risky, if not imprudent, for any company to completely entrust the performance of the operations it has contracted out. EVIDENCE

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 Montero, et. al. vs . Times Trans portation Co., Inc., G .R . No. 190828, March 16,  2015 1. It does not necessary follow that every labor dispute will be automatically decided in favor of labor, as management also has its own rights.  Although the Constitution is committed to the policy of social justice and the protection of the working class, it does not necessary follow that every labor dispute will be automatically decided in favor of labor. The management also has its own rights. Out of concern for the less privileged in life, this Court, has more often than not inclined, to uphold the cause of the worker in his conflict with the employer. Such leaning, however, does not blind the Court to the rule that justice is in every case for the deserving, to be dispensed in the light of the established facts and applicable law and doctrine. DOUBTS

Hocheng Philippines C orporation vs . Farrales, G .R . No. 211497, March 18, 2015 1. If doubts exist between the evidence presented by the employer and that of the employee, the scales of justice must be tilted in favor of the latter. But where there is no showing of a clear, valid and legal cause for termination of employment, the law considers the case a matter of illegal dismissal. If doubts exist between the evidence presented by the employer and that of the employee, the scales of justice must be tilted in favor of the latter. The employer must affirmatively show rationally adequate evidence that the dismissal was for a justifiable cause. PRESCRIPTION

 Montero, et. al. vs . Times Trans portation Co., Inc., G .R . No. 190828, March 16,  2015 1. When action already considered prescribed; case filed but later withdrawn; prescriptive period continues even after the withdrawal of the case as though no action has been filed at all. Settled is the rule that when one is arbitrarily and unjustly deprived of his job or means of livelihood, the action instituted to contest the legality of one’s dismissal from employment constitutes, in essence, an action predicated upon an injury to the rights of the plaintiff, as contemplated under Article 1146 of the New Civil Code, which must be brought within four years. While the filing of the complaint for illegal dismissal before the LA interrupted the running of the prescriptive period, its voluntary withdrawal left the petitioners in exactly the same position as though no complaint had been filed at all. The withdrawal of their complaint effectively erased the tolling of the reglementary period. RESIGNATION

Fonterra B rands Phils. Inc . vs . Larg ado, G.R . No. 205300, March 18, 2015 1. When there is resignation and not illegal dismissal as employees no longer renewed their contracts and applied with another company rendering services to the first company’s former c lient. By refusing to renew their contracts with Zytron, respondents effectively resigned from the latter. Resignation is the voluntary act of employees who are compelled by personal reasons to dissociate themselves from their employment, done with the intention of relinquishing an office, accompanied by the act of abandonment.

22

Here, it is obvious that respondents were no longer interested in continuing their employment with Zytron. Their voluntary refusal to renew their contracts was brought about by their desire to continue their assignment in Fonterra which could not happen in view of the conclusion of Zytron’s contract with Fonterra. Hence, to be able to continue with their assignment, they applied for work with A.C. Sicat with the hope that they will be able to continue rendering services as TMRs at Fonterra since A.C. Sicat is Fonterra’s new manpower supplier. TERMINATION  – CONSEQUENCES  Metrog uards S ecurity A g ency C orporation vs . Hilong o, G .R . No. 215630, March 9,  2015 1. Recomputation of monetary awards until finality of the decision of the Court of Appeals proper and does not constitute an alteration or amendment of the final decision being implemented. In Nacar v. Gallery Frames , the SC held that: x x x no essential change is made by a recomputation as this step is a necessary consequence that flows from the nature of the illegality of dismissal declared by the Labor Arbiter in that decision. A recomputation (or an original computation, if no previous computation has been made) is a part of the law  –  specifically, Article 279 of the Labor Code and the established jurisprudence on this provision  – that is read into the decision. By the nature of an illegal dismissal case, the reliefs continue to add up until full satisfaction, as expressed under Article 279 of the Labor Code. The recomputation of the consequences of illegal dismissal upon execution of the decision does not constitute an alteration or amendment of the final decision being implemented. The illegal dismissal ruling stands; only the computation of monetary consequences of this dismissal is affected, and this is not a violation of the principle of immutability of final judgments. Nacar reiterated the Court’s ruling in the earlier cases of Session Delights and Gonzales.

We thus cannot agree with petitioners’ contention that a decision that has acquired finality becomes immutable and unalterable. The recomputation of the consequences of illegal dismissal upon execution of the decision does not constitute an alteration or amendment of the final decision being implemented. The illegal dismissal ruling stands; only the computation of monetary consequences of this dismissal is affected, and this is not a violation of the principle of immutability of final judgments. LEGAL INTEREST

 Metrog uards S ecurity A g ency C orporation vs . Hilong o, G .R . No. 215630, March 9,  2015 1. Legal interest of 12% per annum on the monetary award. Further, the payment of legal interest of 12% per annum should also be from April 26, 2013 up to June 30, 2013. Thereafter, in accordance with Bangko Sentral ng Pilipinas Monetary Board’s Circular No. 799, series of 2013, the legal interest computed from July 1, 2013 until the monetary awards were fully satisfied will be 6% per annum. SUPPLEMENT NO. 012 APPEAL

Waterfront C ebu C ity C as ino Hotel, Inc. vs . Ledesma, G .R . No. 197556, March 25,  2015

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1. Petition for certiorari should have been dismissed for being filed beyond the 60-day reglementary period; merits of the case not sufficient to excuse defect. In the subsequent case of Domdom v. Third & Fifth Divisions of the Sandiganbayan,the absence of a specific prohibition in Section 4 of Rule 65, as amended, for the extension of the 60-day period to file a petition for certiorari was construed as a discretionary authority of the courts to grant an extension. Republic v. St. Vincent De Paul Colleges, Inc. clarified the "conflict' between the rulings in Laguna Metts Corporation and Domdom,in that the former is the general rule

while the latter is the exception, thus: What seems to be a "conflict" is actually more apparent than real. A reading of the foregoing rulings leads to- the simple conclusion that .Laguna Metts Corporation involves a strict application of the general rule that petitions for certiorari must be filed strictly within sixty (60) days from notice of judgment or from the order denying a motion for reconsideration. Domdom, on the other hand, relaxed the rule and allowed an extension of the sixty (60)-day period subject to the Court's sound discretion. PLEADINGS

Waterfront C ebu C ity C as ino Hotel, Inc. vs . Ledesma, G .R . No. 197556, March 25,  2015 1. Flaw in the verification, being only a formal and not jurisdictional requirement, not a fatal defect. The procedural infirmities pointed out by Ledesma are not adequate to cause the dismissal of the present petition. Gaye Maureen Cenabre presented to the Notary Public a Community Tax Certificate numbered 27401128 to prove her identity instead of a current identification document issued by an official agency bearing her photograph and signature as required by A.M. No. 02-8-13-SC. This rendered the  jurat in the verification/certification of non-forum shopping of Waterfront as defective. Nonetheless, any flaw in the verification, being only a formal, not a jurisdictional requirement, is not a fatal defect. In like manner, there is no need to attach the certified true copy of the Board Resolution quoted in the Secretary's Certificate attached to the petition. Only the  judgment, order or resolution assailed in the petition are the attachments required under Section 4, Rule 45 of the Rules of Court to be duplicate originals or certified true copies. TERMINATION 1. Valid termination due to lascivious conduct.

Waterfront C ebu C ity C as ino Hotel, Inc. vs . L edesma, G .R . No. 197556, March 25,  2015 The CA ruled in favor of Ledesma since it believed his version that the complainants merely invented the accusations against him because Waterfront failed to present as evidence the CCTV footages of the alleged lascivious conduct of Ledesma inside the elevator and the conference room. But this argument was not even raised by Ledesma himself and it was only the CA which utilized this as a justification to bolster its findings that Ledesma did not commit any infraction. This being a labor case, the evidence required is only substantial evidence which was adequately established here by the positive and credible testimonies of the complainants. Notably, Ledesma never refuted, at the administrative investigation level at Waterfront, and even at the proceedings before the LA, NLRC, and the CA, the allegations leveled against him by Rosanna Lofranco that, after deluding her to perform a massage on him, Ledesma exhibited to her his penis and requested that he be

24 masturbated while inside the conference room of the hotel. If not for the position of Ledesma as a House Detective, he will not have access to the conference room nor will he know that the premises is not monitored through a closed-circuit television, thus giving him the untrammeled opportunity to accomplish his lewd design on the unsuspecting victim. Such acts of Ledesma constituted misconduct or improper behavior which is a just cause for his dismissal. WILLFUL DISOBEDIENCE

The Coffee Bean and Tea Leaf Philippines, Inc. vs. Arenas, G.R. No. 208908,  March 11, 2015 1. No willful disobedience proven; alleged infractions do not amount to a wrongful and perverse attitude. 2. Three counts of tardiness do not constitute gross or habitual neglect of duty. Gross negligence implies a want or absence of, or failure to exercise even a slight care or diligence, or the entire absence of care. It evinces a thoughtless disregard of consequences without exerting any effort to avoid them. There is habitual neglect if based on the circumstances, there is a repeated failure to perform one’s duties for a period of time. In light of the foregoing criteria, we rule that Arenas’ three counts of tardiness cannot be considered as gross and habitual neglect of duty. The infrequency of his tardiness already removes the character of habitualness. These late attendances were also broadly spaced out, negating the complete absence of care on Arenas’ part in the performance of his duties. Even CBTL admitted in its notice to explain that this violation does not merit yet a disciplinary action and is only an aggravating circumstance to  Arenas’ other violations.

3. No serious misconduct proven as there was no active dishonesty on the part of the employee. For misconduct or improper behavior to be a just cause for dismissal, (a) it must be serious ; (b) it must relate to the performance of the employee’s duties; and (c) it must show that the employee has become unfit to continue working for the employer . However, the facts on record reveal that there was no active dishonesty on the part of Arenas. When questioned about who placed the bottled iced tea inside the ice bin, his immediate reaction was not to deny his mistake, but to remove the bottle inside the bin and throw it outside. More importantly, when he was asked to make a written explanation of his action, he admitted that the bottled iced tea was his. Thus, even if there was an initial reticence on Arenas’ part, his subsequent act of owing to his mistake only shows the absence of a deliberate intent to lie or deceive his CBTL superiors. On this score, we conclude that Arenas’ action did not amount to serious misconduct.

SUPPLEMENT NO. 013 APPEAL

Wallem Philippines Services, Inc. vs. Heirs of the late Peter Padrones, G.R. No. 183212, March 16, 2015 1. Party not allowed to change his theory on appeal.

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In their Comment to petitioners' Motion for Reconsideration of the CA Decision, as well as in their Comment to the present petition, respondents abandoned their claim for death benefits and focused solely on Padrones' supposed entitlement to disability benefits. However, nowhere in respondents' Comment did they refute petitioners' basic contention that they are not entitled to disability benefits on the ground that this issue was never litigated before the lower tribunals. Respondents argue as if the issue of their entitlement to disability benefits was a matter which was raised at the first instance. Respondents have, in effect, changed their theory of the case. DAMAGES

Hacienda C ataywa vs. Lorezo, G.R . No. 179640, March 18, 2015 1. Should the employer misrepresent the true date of the employment of the employee member, such employer shall pay to the SSS damages equivalent to the difference between the amount of benefit to which the employee member or his beneficiary is entitled had the proper contributions been remitted to the SSS and the amount payable on the basis of the contributions actually remitted. The law provides that should the employer misrepresent the true date of the employment of the employee member, such employer shall pay to the SSS damages equivalent to the difference between the amount of benefit to which the employee member or his beneficiary is entitled had the proper contributions been remitted to the SSS and the amount payable on the basis of the contributions actually remitted. However, should the employee member or his beneficiary is entitled to pension benefits, the damages shall be equivalent to the accumulated pension due as of the date of settlement of the claim or to the five years' pension, whichever is higher, including the dependent's pension. 2. The imposition upon and payment by the delinquent employer of the three percent (3%) penalty for the late remittance of premium contributions is mandatory and cannot be waived by the System. The imposition upon and payment by the delinquent employer of the three percent (3%) penalty for the late remittance of premium contributions is mandatory and cannot be waived by the System. The law merely gives to the Commission the power to prescribe the manner of paying the premiums. Thus, the power to remit or condone the penalty for late remittance of premium contributions is not embraced therein. Petitioners erred in alleging that the imposition of penalty is not proper. EMPLOYEE STATUS

Hacienda C ataywa vs. Lorezo, G.R . No. 179640, March 18, 2015 1. Farm seasonal worker, not casual worker. Jurisprudence has identified the three types of employees mentioned in the provision of the Labor Code: (1) regular employees or those who have been engaged to perform activities that are usually necessary or desirable in the usual business or trade of the employer; (2) project employees or those whose employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of their engagement, or those whose work or service is seasonal in nature and is performed for the duration of the season; and (3) casual employees or those who are neither regular nor project employees. Farm workers generally fall under the definition of seasonal employees. It was also consistently held that seasonal employees may be considered as regular employees when they are called to work from time to time. They are in regular employment because of the nature of the job, and not because of the length of time they

26 have worked. However, seasonal workers who have worked for one season only may not be considered regular employees. The nature of the services performed and not the duration thereof, is determinative of coverage under the law. To be exempted on the basis of casual employment, the services must not merely be irregular, temporary or intermittent, but the same must not also be in connection with the business or occupation of the employer. Thus, it is erroneous for the petitioners to conclude that the respondent was a very casual worker simply because the SSS form revealed that she had 16 months of contributions. It does not, in any way, prove that the respondent performed a job which is not in connection with the business or occupation of the employer to be considered as casual employee. 2. No particular form of evidence required to prove the existence of the employeremployee relationship. It was settled that there is no particular form of evidence required to prove the existence of the employer-employee relationship. Any competent and relevant evidence to prove such relationship may be admitted. This may entirely be testimonial. If only documentary evidence would be required to demonstrate the relationship, no scheming employer would be brought before the bar of justice. Petitioners erred in insisting that, due to passage of time, SSS Form R-1A is the only remaining source of information available to prove when respondent started working for them. However, such form merely reflected the time in which the petitioners reported the respondent for coverage of the SSS benefit. They failed to substantiate their claim that it was only in 1978 that respondent reported for work. 3. When veil of corporate fiction not pierced. It was held in Rivera v. United Laboratories, Inc. that _ While a corporation may exist for any lawful purpose, the law will regard it as an association of persons or, in case of two corporations, merge them into one, when its corporate legal entity is used as a cloak for fraud or illegality. This is the doctrine of piercing the veil of corporate fiction. The doctrine applies only when such corporate fiction is used to defeat public convenience, justify wrong, protect fraud, or defend crime, or when it is made as a shield to confuse the legitimate issues, or where a corporation is the mere alter ego or business conduit of a person, or where the corporation is so organized and controlled and its affairs are so conducted as to make it merely an instrumentality, agency, conduit or adjunct of another corporation. To disregard the separate juridical personality of a corporation, the wrongdoing must be established clearly and convincingly. It cannot be presumed. This Court has cautioned against the inordinate application of this doctrine, reiterating the basic rule that “the corporate veil may be pierced only if it becomes a shield for fraud, illegality or inequity committed against a third person. The Court has expressed the language of piercing doctrine when applied to alter ego cases, as follows: Where the stock of a corporation is owned by one person whereby the corporation functions only for the benefit of such individual owner, the corporation and the individual should be deemed the same.

This Court agrees with the petitioners that there is no need to pierce the corporate veil. Respondent failed to substantiate her claim that Mancy and Sons Enterprises, Inc. and Manuel and Jose Marie Villanueva are one and the same. SUPPLEMENT NO. 014

27

EMPLOYEE COMPENSATION

Dohle-Philman Manning Agency, Inc. vs. Heirs of Andres Gazzingan, G.R. No. 199568, J une 17, 2015 1. Aortic dissection, also called dissecting aneurysm, considered compensable under the disputable presumption of compensability. Gazzingan’s work as a messman is not confined mainly to serving food and beverages to all officers and crew; he was likewise tasked to assist the chief cook/chef steward, and thus performed most if not all the duties in the ship’s steward department. In the performance of his duties, he is bound to suffer chest and back pains, which could have caused or aggravated his illness. As aptly observed by the CA, Gazzingan’s strenuous duties caused him to suffer physical stress which exposed him to injuries. It is therefore reasonable to conclude that Gazzingan’s employment has contributed to some degree to the development of his disease.

It must also be pointed out that Gazzingan was in good health and fit to work when he was engaged by petitioners to work on board the vessel M/V Gloria . His PEME showed essentially normal findings with no hypertension and without any heart problems. It was only while rendering duty that he experienced symptoms. This is supported by a medical report issued by Cartagena de Indias Hospital in Colombia stating that Gazzingan suffered intense chest and back pains, shortness of breath and a slightly elevated blood pressure while performing his duties. Therefore, even assuming that Gazzingan had a pre-existing condition, as alleged by petitioners, this does not totally negate the probability and the possibility that his aortic dissection was aggravated by his work conditions. More importantly, the 2000 POEA-SEC has created a presumption of compensability for those illnesses which are not listed as an occupational disease. Section 20 (B), paragraph (4) states that “those illnesses not listed in Section 32 of this Contract are disputably presumed as work-related.” Concomitant with this presumption is the burden placed upon the claimant to present substantial evidence that his work conditions caused or at least increased the risk of contracting the disease and only a reasonable proof of work-connection, not direct causal relation is required to establish compensability of illnesses not included in the list of occupational diseases. 2. Company-designated physician’s opinion not conclusive as to non -workrelatedness of seafarer’s illness.

While petitioners were quick to point out that Dr. Banaga is a companydesignated physician, the latter, however, could not have possibly arrived at a reliable diagnosis of Gazzingan’s condition. His assessment, based merely on Gazzingan’s PEME, did not reflect the true state of health of the seafarer. As the Court has previously ruled, a PEME is not exploratory in nature and cannot be relied upon to arrive at a seafarer’s true state of health. MEDICAL CERTIFICATE

 A ce Navi g ation Company vs . G arcia, G .R . No. 207804, J une 17, 2015 1. Company- designated physicians’ findings up held over the single medical certificate of Dr. Escutin. It is clear from the CBA stipulation that should there be a discrepancy between the findings of the company- designated physician and the seafarer’s independent physician, it is necessary to appoint a third physician whose findings shall be controlling. The use of the word “shall” in said stipulation indicates the mandatory nature of such requirement. More so, the CBA is the law between the parties, hence they are obliged to comply with its provisions.

28  As earlier stated, Dr. Cruz, the company-designated physician, found Garcia to be suffering from a Grade 10 disability rating, as opposed to that of Garcia’s own physician, Dr. Escutin, who diagnosed him with a work-related total and permanent injury on his cervical spine, rendering him unfit to be a seaman in whatever capacity. In view of such contrasting diagnoses, Garcia should have resorted to the conflictresolution mechanism provided under the VELA-AMOSUP CBA. His non-compliance with the same would necessarily result in the affirmance of the findings of the companydesignated physician. 2. Claims for compensation cannot be based on whims and caprices; when the evidence presented negates compensability, the claim must fail, lest it causes injustice to the employer.  As a final note, it must be stressed that while the Court adheres to the principle of liberality in favor of the seafarer, it cannot allow claims for compensation based on whims and caprices. When the evidence presented negates compensability, the claim must fail, lest it causes injustice to the employer. SECOND OPINION

C ag atin vs . Mag s ays ay Maritime Corporation, G .R . No. 175795, J une 22, 2015 1. Opinion of seafarer’s physician not as reliable as that of the company -

designated physician as it did not contain supporting tests and examinations and was obtained seven (7) months after he was declared fit to work; seafarer failed to prove that the company-designated physician was in bad faith for declaring him fit to work; company-designated physician treated seafarer several times for a period of five (5) months while the seafarer’s physician examined him only once.

Petitioner failed to meet the standard of substantial evidence when he not only failed to present his own physician's report, that of Dr. Collantes, with supporting tests and examinations which would have objectively established his supposed permanent disability, but he was also unable to substantiate his claim of “bad faith, malice and abuse” or “manifest partiality” on the findings of the company-designated physician, Dr. Cruz. To illustrate, it is on record that Dr. Cruz's earlier finding was supported by tests and opinions of experts. Dr. Cruz has stated in his report and affidavit that petitioner's treatment was conducted not just by him alone, but by his other “colleagues who specialize in orthopedic surgery and rehabilitation medicine.” Then, as stated in Dr. Cruz's January 15, 2002 report, it was these same experts who “evaluated and allowed” petitioner to resume his previous activities. Also, Dr. Cruz's findings are supported by the latest results of an EMG- NCV test, which was “normal.” Dr. Cruz then personally found that petitioner had “no low back pain and radiculopathy;” had a “full” range of motion in his trunk ; had “improved tolerance to prolonged sitting, standing and walking;” and had “improved lifting capacity to 40 kilos.” Petitioner never immediately protested such findings. He also does not deny that he was seen and treated by orthopedic surgeons and rehabilitation specialists who worked along with Dr. Cruz, or that he went through an EMG-NCV test. In contrast, petitioner presents the report of his own physician, Dr. Collantes, who examined him almost seven (7) months after he was declared “fit to work” b y Dr. Cruz. The Court finds, however, that this later report by petitioner's chosen doctor is not as reliable as that of the company-designated physician.  As respondents contend, it is unknown “what transpired between January 15, 2002 (when petitioner was declared “fit to work” by the company -designated physician) and August 9, 2002 (when he was declared “unfit to work at sea” by his own physician). It was petitioner's duty as claimant to enlighten the labor tribunals as well as the courts as to what transpired in these seven (7) months.

240-DAY RULE

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C ag atin vs . Mag s ays ay Maritime Corporation, G .R . No. 175795, J une 22, 2015 1. Seafarer declared fit to work well within the 240-day period.  And in jurisprudence interpreting the afore-quoted provision of the POEA-SEC, a temporary total disability only becomes permanent when so declared by the companydesignated physician within the periods he is allowed to do so, or upon the expiration of the maximum 240-day medical treatment period without a declaration of either fitness to work or the existence of a permanent disability. The 240-day period is meant to harmonize the provision of the POEA-SEC above with the provisions of the Rules and Regulations Implementing Book IV of the Labor Code, specifically Rule X, Section 2, on disability benefits. Where before it was held that permanent disability is the inability of a seafarer to perform his work for more than 120 days, regardless of whether or not he loses the use of any part of his body, now the rule is that if the injury or sickness still requires medical attendance beyond 120 days, the company-designated physician has, including the initial 120 days, up to a maximum of 240 days to declare either fitness to work or permanent disability, beyond which and with or without any declaration, the disability is considered total and permanent. In the case at bar, the declaration by Dr. Cruz that petitioner was “fit to work” went beyond the 120-day period; however, as the reason therefor was that petitioner still required additional medical treatment, his declaration as “fit to work” was made within the maximum 240 days which therefore forestalls the automatic classification of petitioner's injury as total and permanent and, thus, entitled to the pertinent disability benefits.

2. No breach of contract proven.

C ag atin vs . Mag s ays ay Maritime Corporation, G .R . No. 175795, J une 22, 2015 The transfer of a seafarer to another vessel is not proscribed but allowed by the parties' contract, which is the POEA-SEC. The following provision of the POEA-SEC states: Section 15. Transfer Clause. The seafarer agrees to be transferred at any port to any vessel owned or operated, manned or managed by the same employer, provided it is accredited to the same manning agent and provided further that the position of the seafarer and the rate of his wages and terms of service are in no way inferior and the total period of employment shall not exceed that originally agreed upon.  Any form of transfer shall be documented and made available when necessary.

3. No proof that seafarer’s adenocarcinoma was contracted during the term of the

last employment contract; seafarer was repatriated not for medical reasons but for finished contract and died one year after the termination of his last employment contract. EMPLOYER-EMPLOYEE RELATIONSHIP

R eyes vs . G laucoma R esearch F oundation, Inc., G .R . No. 189255, J une 17, 2015 1. Employer-employee relationship not proven; consultant, not employee. Petitioner contends that, as evidence of respondents' supposed control over him, the organizational plans he has drawn were subject to the approval of respondent corporation's Board of Trustees. However, the Court agrees with the disquisition of the CA on this matter, to wit:

30 [Respondents'] power to approve or reject the organizational plans drawn by [petitioner] cannot be the control contemplated in the “control test.” It is but logical that one who commissions another to do a piece of work should have the right to accept or reject the product. The important factor to consider in the “control test” is still the element of control over how the work itself is done, not just the end result thereof. Well settled is the rule that where a person who works for another performs his job more or less at his own pleasure, in the manner he sees fit, not subject to definite hours or conditions of work, and is compensated according to the result of his efforts and not the amount thereof, no employer-employee relationship exists. What was glaring in the present case is the undisputed fact that petitioner was never subject to definite working hours. He never denied that he goes to work and leaves therefrom as he pleases. In fact, on December 1-31, 2004, he went on leave without seeking approval from the officers of respondent company. On the contrary, his letter simply informed respondents that he will be away for a month and even advised them that they have the option of appointing his replacement during his absence. This Court has held that there is no employer-employee relationship where the supposed employee is not subject to a set of rules and regulations governing the performance of his duties under the agreement with the company and is not required to report for work at any time, nor to devote his time exclusively to working for the company. In this regard, this Court also agrees with the ruling of the CA that:  Aside from the control test, the Supreme Court has also used the economic reality test in determining whether an employer-employee relationship exists between the parties. Under this test, the economic realities prevailing within the activity or between the parties are examined, taking into consideration the totality of circumstances surrounding the true nature of the relationship between the parties. This is especially appropriate when, as in this case, there is no written agreement or contract on which to base the relationship. In our jurisdiction, the benchmark of economic reality in analyzing possible employment relationships for purposes of applying the Labor Code ought to be the economic dependence of the worker on his employer. In the instant case, as shown by the resume of [petitioner], he concurrently held consultancy positions with the Manila International Airport Authority (from 04 March 2001 to September 2003 and from 01 November 2004 up to the present) and the AntiTerrorist Task Force for Aviation and Air Transportation Sector (from 16 April 2004 to 30 June 2004) during his stint with the Eye Referral Center (from 01 August 2003 to 29  April 2005). Accordingly, it cannot be said that the [petitioner] was wholly dependent on [respondent] company. 2. Alleged payslips or designation of payments as salaries not determinative of the existence of an employer-employee relationship. In bolstering his contention that there was an employer-employee relationship, petitioner draws attention to the pay slips he supposedly received from respondent corporation. However, he does not dispute the findings of the CA that there are no deductions for SSS and withholding tax from his compensation, which are the usual deductions from employees' salaries. Thus, the alleged pay slips may not be treated as competent evidence of petitioner's claim that he is respondents' employee. 3. Designation as administrator and issuance of ID card are not adequate proof of employer-employee relationship. 4. Affidavits not hearsay.

31

 Additional evidence of the fact that petitioner was hired as a consultant and not as an employee of respondent corporation are affidavits to this effect which were executed by Roy Oliveresand Aurea Luz Esteva, who are Medical Records Custodian and Administrative Officer, respectively, of respondent corporation. Petitioner insists in its objection of the use of these affidavits on the ground that they are, essentially, hearsay. However, this Court has ruled that although the affiants had not been presented to affirm the contents of their affidavits and be cross-examined, their affidavits may be given evidentiary value; the argument that such affidavits were hearsay was not persuasive. Likewise, this Court ruled that it was not necessary for the affiants to appear and testify and be cross-examined by counsel for the adverse party. To require otherwise would be to negate the rationale and purpose of the summary nature of the proceedings mandated by the Rules and to make mandatory the application of the technical rules of evidence. 4. Claims for compensation cannot be based on whims and caprices; when the evidence presented negates compensability, the claim must fail, lest it causes injustice to the employer. (see EMPLOYEE COMPENSATION)

 A ce Navi g ation Company vs . G arcia, G .R . No. 207804, J une 17, 2015  As a final note, it must be stressed that while the Court adheres to the principle of liberality in favor of the seafarer, it cannot allow claims for compensation based on whims and caprices. When the evidence presented negates compensability, the claim must fail, lest it causes injustice to the employer.

C ag atin vs . Mag s ays ay Maritime Corporation, G .R . No. 175795, J une 22, 2015  As a final note, the Court is wary of the principle that provisions of the POEASEC must be applied with liberality in favor of the seafarers, for it is only then that its beneficent provisions can be fully carried into effect. However, on several occasions when disability claims anchored on such contract were based on flimsy grounds and unfounded allegations, the Court never hesitated to deny the same. Claims for compensation based on surmises cannot be allowed; liberal construction is not a license to disregard the evidence on record or to misapply the laws. This Court abides by the principle that justice is in every case for the deserving, to be dispensed with in the light of established facts, the applicable law, and existing jurisprudence. 5. In a case of claims for disability benefits, the onus probandi falls on the seafarer as claimant to establish his claim with the right quantum of evidence; it cannot rest on speculations, presumptions or conjectures; seafarer has to prove assertion of permanent disability and bad faith on the part of the employer.

C ag atin vs . Mag s ays ay Maritime Corporation, G .R . No. 175795, J une 22, 2015 In labor cases, as in all cases which require the presentation and weighing of evidence, the basic rule is that the burden of evidence lies with the party who asserts the affirmative of an issue. In particular, in a case of claims for disability benefits, the onus probandi falls on the seafarer as claimant to establish his claim with the right quantum of evidence; it cannot rest on speculations, presumptions or conjectures. Such party has the burden of proving the said assertion with the quantum of evidence required by law which, in a case such as this of a claim for disability benefits arising from one's employment as a seafarer, is substantial evidence. Substantial evidence is not one that establishes certainty beyond reasonable doubt, but only “such relev ant evidence as a reasonable mind might accept as adequate to support a conclusion,” even if other minds, equally reasonable, might conceivably opine otherwise. It is more than a mere scintilla of evidence. It is against this standard that petitioner's assertion that he was declared “permanently unfit to return to sea duty in whatever capacity” must be measured,

32 especially since petitioner levels such assertion against an earlier finding by the company-designated physician that he was “fit to work.” Likewi se, he accuses respondents of bad faith in declaring him fit to work. Both assertions need substantive proof. 6. Good faith is always presumed and he who alleges the contrary on his opponent has the burden of proving that the latter acted in bad faith, with malice, or with ill motive; allegations are not proof; seafarer failed to prove bad faith on the part of the company-designated physician.

C ag atin vs . Mag s ays ay Maritime Corporation, G .R . No. 175795, J une 22, 2015 The allegation of petitioner that the allegedly contradicting reports of Dr. Cruz were the result of respondents' malice, bad faith and abuse is not supported by him with substantial evidence. It is consistently held that good faith is always presumed and he who alleges the contrary on his opponent has the burden of proving that the latter acted in bad faith, with malice, or with ill motive. Mere allegation is not equivalent to proof.  Although strict rules of evidence are not applicable in claims for compensation and disability benefits, the seafarer must still prove his claim with substantial evidence, otherwise, injustice will be done to his employer. Other than petitioner's bare allegations, nothing on record supports his assertion of malice and bad faith. 4. Competent evidence of identity is not required in cases where the affiant is personally known to the notary public. TERMINATION

Nagui t vs . S an Mig uel C orporation, G .R . No. 188839, J une 22, 2015 1. Valid termination for serious misconduct by assaulting co-worker in the workplace; penalty of dismissal not too harsh despite long years of service and this being his first offense. If petitioner's long years of service would be regarded as a justification for moderating the penalty of dismissal, it will actually become a prize for disloyalty, perverting the meaning of social justice and undermining the efforts of labor to cleanse its ranks of all undesirables. In addition, 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. In the present case, all the more should petitioner's years of service be taken against him in light of the finding of the lower tribunals that his violation of an established company rule was shown to be willful and such willfulness was characterized by a wrongful attitude. Moreover, petitioner has never shown any feelings of remorse for what he has done, considering that the lower tribunals found no justification on his part in inflicting injury upon a co-employee. To make matters worse, petitioner even exhibited a seemingly arrogant attitude in insisting to remain silent and rejecting requests for him to explain his side despite having been given numerous opportunities to do so. GOOD LUCK