G.R. No. 78909 June 30, 1989 MATERNITY CHILDREN'S HOSPITAL, represented by ANTERA L. DORADO, President, petitioner, vs.

THE HONORABLE SECRETARY OF LABOR AND THE REGIONAL DlRECTOR OF LABOR, REGION X,respondents. MEDIALDEA, J.: This is a petition for certiorari seeking the annulment of the Decision of the respondent Secretary of Labor dated September 24, 1986, affirming with modification the Order of respondent Regional Director of Labor, Region X, dated August 4, 1986, awarding salary differentials and emergency cost of living allowances (ECOLAS) to employees of petitioner, and the Order denying petitioner's motion for reconsideration dated May 13, 1987, on the ground of grave abuse of discretion. Petitioner is a semi-government hospital, managed by the Board of Directors of the Cagayan de Oro Women's Club and Puericulture Center, headed by Mrs. Antera Dorado, as holdover President. The hospital derives its finances from the club itself as well as from paying patients, averaging 130 per month. It is also partly subsidized by the Philippine Charity Sweepstakes Office and the Cagayan De Oro City government. Petitioner has forty-one (41) employees. Aside from salary and living allowances, the employees are given food, but the amount spent therefor is deducted from their respective salaries (pp. 7778, Rollo). On May 23, 1986, ten (10) employees of the petitioner employed in different capacities/positions filed a complaint with the Office of the Regional Director of Labor and Employment, Region X, for underpayment of their salaries and ECOLAS, which was docketed as ROX Case No. CW-71-86. On June 16, 1986, the Regional Director directed two of his Labor Standard and Welfare Officers to inspect the records of the petitioner to ascertain the truth of the allegations in the complaints (p. 98, Rollo). Payrolls covering the periods of May, 1974, January, 1985, November, 1985 and May, 1986, were duly submitted for inspection. On July 17, 1986, the Labor Standard and Welfare Officers submitted their report confirming that there was underpayment of wages and ECOLAs of all the employees by the petitioner, the dispositive portion of which reads: IN VIEW OF THE FOREGOING, deficiency on wage and ecola as verified and confirmed per review of the respondent payrolls and interviews with the complainant workers and all other information gathered by the team, it is respectfully recommended to the Honorable Regional Director, this office, that Antera Dorado, President be ORDERED to pay the amount of SIX HUNDRED FIFTY FOUR THOUSAND SEVEN HUNDRED FIFTY SIX & 01/100 (P654,756.01), representing underpayment of wages and ecola to the THIRTY SIX (36) employees of the said hospital as appearing in the attached Annex "F" worksheets and/or whatever action equitable under the premises. (p. 99, Rollo) Based on this inspection report and recommendation, the Regional Director issued an Order dated August 4, 1986, directing the payment of P723,888.58, representing underpayment of wages and ECOLAs to all the petitioner's employees, the dispositive portion of which reads: WHEREFORE, premises considered, respondent Maternity and Children Hospital is hereby ordered to pay the above-listed complainants the total amount indicated opposite each name, thru this Office within ten (10) days from receipt thereof.

Thenceforth, the respondent hospital is also ordered to pay its employees/workers the prevailing statutory minimum wage and allowance. SO ORDERED. (p. 34, Rollo) Petitioner appealed from this Order to the Minister of Labor and Employment, Hon. Augusto S. Sanchez, who rendered a Decision on September 24, 1986, modifying the said Order in that deficiency wages and ECOLAs should be computed only from May 23, 1983 to May 23, 1986, the dispositive portion of which reads: WHEREFORE, the August 29, 1986 order is hereby MODIFIED in that the deficiency wages and ECOLAs should only be computed from May 23, 1983 to May 23, 1986. The case is remanded to the Regional Director, Region X, for recomputation specifying the amounts due each the complainants under each of the applicable Presidential Decrees. (p. 40, Rollo) On October 24, 1986, the petitioner filed a motion for reconsideration which was denied by the Secretary of Labor in his Order dated May 13, 1987, for lack of merit (p. 43 Rollo). The instant petition questions the all-embracing applicability of the award involving salary differentials and ECOLAS, in that it covers not only the hospital employees who signed the complaints, but also those (a) who are not signatories to the complaint, and (b) those who were no longer in the service of the hospital at the time the complaints were filed. Petitioner likewise maintains that the Order of the respondent Regional Director of Labor, as affirmed with modifications by respondent Secretary of Labor, does not clearly and distinctly state the facts and the law on which the award was based. In its "Rejoinder to Comment", petitioner further questions the authority of the Regional Director to award salary differentials and ECOLAs to private respondents, (relying on the case of Encarnacion vs. Baltazar, G.R. No. L-16883, March 27, 1961, 1 SCRA 860, as authority for raising the additional issue of lack of jurisdiction at any stage of the proceedings, p. 52, Rollo), alleging that the original and exclusive jurisdiction over money claims is properly lodged in the Labor Arbiter, based on Article 217, paragraph 3 of the Labor Code. ISSUE: The primary issue here is whether or not the Regional Director had jurisdiction over the case and if so, the extent of coverage of any award that should be forthcoming, arising from his visitorial and enforcement powers under Article 128 of the Labor Code. The matter of whether or not the decision states clearly and distinctly statement of facts as well as the law upon which it is based, becomes relevant after the issue on jurisdiction has been resolved. HELD: This is a labor standards case, and is governed by Art. 128-b of the Labor Code, as amended by E.O. No. 111. Labor standards refer to the minimum requirements prescribed by existing laws, rules, and regulations relating to wages, hours of work, cost of living allowance and other monetary and welfare benefits, including occupational, safety, and health standards (Section 7, Rule I, Rules on the Disposition of Labor Standards Cases in the Regional Office, dated September 16, 1987). 1 Under the present rules, a Regional Director exercises bothvisitorial and enforcement power over labor standards cases, and is therefore empowered to adjudicate money claims, provided there still exists an employer-employee relationship, and the findings of the regional office is not contested by the employer concerned. Prior to the promulgation of E.O. No. 111 on December 24, 1986, the Regional Director's authority over money claims was unclear. The complaint in the present case was filed on May 23, 1986 when

E.O. No. 111 was not yet in effect, and the prevailing view was that stated in the case of Antonio Ong, Sr. vs. Henry M. Parel, et al., G.R. No. 76710, dated December 21, 1987, thus: . . . the Regional Director, in the exercise of his visitorial and enforcement powers under Article 128 of the Labor Code, has no authority to award money claims, properly falling within the jurisdiction of the labor arbiter. . . . . . . If the inspection results in a finding that the employer has violated certain labor standard laws, then the regional director must order the necessary rectifications. However, this does not include adjudication of money claims, clearly within the ambit of the labor arbiter's authority under Article 217 of the Code. The Ong case relied on the ruling laid down in Zambales Base Metals Inc. vs. The Minister of Labor, et al., (G.R. Nos. 73184-88, November 26, 1986, 146 SCRA 50) that the "Regional Director was not empowered to share in the original and exclusive jurisdiction conferred on Labor Arbiters by Article 217." We believe, however, that even in the absence of E. O. No. 111, Regional Directors already had enforcement powers over money claims, effective under P.D. No. 850, issued on December 16, 1975, which transferred labor standards cases from the arbitration system to the enforcement system. To clarify matters, it is necessary to enumerate a series of rules and provisions of law on the disposition of labor standards cases. Prior to the promulgation of PD 850, labor standards cases were an exclusive function of labor arbiters, under Article 216 of the then Labor Code (PD No. 442, as amended by PD 570-a), which read in part: Art. 216. Jurisdiction of the Commission. The Commission shall have exclusive appellate jurisdiction over all cases decided by the Labor Arbiters and compulsory arbitrators. The Labor Arbiters shall have exclusive jurisdiction to hear and decide the following cases involving all workers whether agricultural or non-agricultural. xxx xxx xxx (c) All money claims of workers, involving non-payment or underpayment of wages, overtime compensation, separation pay, maternity leave and other money claims arising from employeeemployer relations, except claims for workmen's compensation, social security and medicare benefits; (d) Violations of labor standard laws; xxx xxx xxx (Emphasis supplied) The Regional Director exercised visitorial rights only under then Article 127 of the Code as follows: ART. 127. Visitorial Powers. The Secretary of Labor or his duly authorized representatives, including, but not restricted, to the labor inspectorate, shall have access to employers' records and premises at any time of the day or night whenever work is being undertaken therein, and the right to copy therefrom, to question any

employee and investigate any fact, condition or matter which may be necessary to determine violations or in aid in the enforcement of this Title and of any Wage Order or regulation issued pursuant to this Code. With the promulgation of PD 850, Regional Directors were given enforcement powers, in addition to visitorial powers. Article 127, as amended, provided in part: SEC. 10. Article 127 of the Code is hereby amended to read as follows: Art. 127. Visitorial and enforcement powers. xxx xxx xxx (b) The Secretary of Labor or his duly authorized representatives shall have the power to order and administer, after due notice and hearing, compliance with the labor standards provisions of this Code based on the findings of labor regulation officers or industrial safety engineers made in the course of inspection, and to issue writs of execution to the appropriate authority for the enforcement of their order. xxx xxx xxx

National Service Corp. v. NLRC, 168 SCRA 125 (1988) -- The civil service does not include Government owned or controlledcorporations (GOCC) which are organized as subsidiaries of GOCC under the general corporation law.F: Eugenio Credo was an employee of the National Service Corporation. She claims she was illegally dismissed. NLRC ruled orderingher reinstatement. NASECO argues that NLRC has no jurisdiction to order her reinstatement. NASECO as a government corporation byvirtue of its being a subsidiary of the NIDC, which is wholly owned by the Phil. National Bank which is in turn a GOCC, the terms andconditions of employment of its employees are governed by the Civil Service Law citing National Housing v Juco. ISSUE: W/N employees of NASECO, a GOCC without original charter, are governed by the Civil Service Law. HELD: NO. The holding in NHC v Juco should not be given retroactive effect, that is to cases that arose before its promulgation of Jan 17, 1985. To do otherwise would be oppressive to Credo and other employees similarly situated because under the 1973 Constibut prior to the ruling in NHC v Juco, this court recognized the applicability of the Labor jurisdiction over disputes involving terms andconditions of employment in GOCC's, among them NASECO.In the matter of coverage by the civil service of GOCC, the 1987 Consti starkly differs from the 1973 consti where NHC v Juco wasbased. It provides that the "civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government,including government owned or controlled corporation with original charter." Therefore by clear implication, the civil service doesnot include GOCC which are organized as subsidiaries of GOCC under the general corporation law

G.R. No. L-68147 June 30, 1988

AMADA RANCE, MERCEDES LACUESTA, MELBA GUTIERREZ, ESTER FELONGCO, CATALINO ARAGONES, CONSOLACION DE LA ROSA, AMANCIA GAY, EDUARDO MENDOZA, ET AL., petitioners, vs. THE NATIONAL LABOR RELATIONS COMMISSION, POLYBAG MANUFACTURING CORPORATION, VIRGINIA MALLARI, JOHNNY LEE, ROMAS VILLAMIN, POLYBAG WORKERS UNION, PONCIANO FERNANDEZ, AND ANTONIO ANTIQUERA, respondents.

PARAS, J.: A review of the records shows that a Collective Bargaining Agreement was entered into on April 30, 1981 by and between respondents Polybag Manufacturing Corporation and Polybag Workers Union which provides among others: ARTICLE V UNION SECURITY Any employee within the bargaining agreement who is a member of the union at the time of the effectivity of this agreement or becomes a member of the UNION thereafter, shall during the term thereof or any extention, continue to be a member in good standing of the UNION as a condition of continued employment in the COMPANY. Any employee hired during the effectivity of this agreement shall, within 30 days after becoming regular join the UNION and continue to be a member in good standing thereof as a condition of continued employment in the COMPANY. On the basis of a board resolution of the UNION, the COMPANY shall dismiss from the service any member of the UNION who loses his membership in good standing either by resignation therefrom or expulsion therefrom for any of the following causes: 1. Disloyalty to the UNION; 2. Commission of acts inimical to the interest of the UNION; 3. Failure and refusal to pay UNION dues and other assessments; 4. Conviction for any offense or crime; or 5. Organizing and/or joining another labor organization claiming jurisdiction similar to that of the UNION. Provided, however, that in case expulsion proceedings are instituted against any member of the UNION, pending such proceedings, the COMPANY, on the basis of a board resolution of the UNION, shall suspend the member concerned; and provided further, that the UNION, jointly and severally with the officers and members of the board voting for the dismissal or suspension, shall hold and render the COMPANY, its executive, owners, and officers free from any and all claims and liabilities. (Rollo, p. 64). Petitioners herein were among the members of the respondent union who were expelled by the latter for disloyaltyin that they allegedly joined the NAFLU a large federation. Because of the expulsion, petitioners were dismissed by respondent Corporation. Petitioners sued for reinstatement and

backwages stating their dismissal was without due process. Losing both in the decisions of the Labor Arbiter and the National Labor Relations Commission (NLRC), they elevated their cause to the Supreme Court. Respondent Polybag Workers Union as already stated expelled 125 members on the ground of disloyalty and acts inimical to the interests of the Union (Resolution No. 84, series of 1982, Rollo, p. 16) based on the findings and recommendations of the panel of investigators. Both the Labor Arbiter and the NLRC found the Collective Bargaining Agreement and the "Union Security Clause" valid and considered the termination of the petitioners justified thereunder, for having committed an act of disloyalty to the Polybag Workers Union by having affiliated with and having joined the NAFLU, another labor union claiming jurisdiction similar to the former, while still members of respondent union (Rollo, pp. 45-46). Among the disputed portions of the NLRC decision is its finding that it has been substantially proven that the petitioners committed acts of disloyalty to their union as a consequence of the filing by NAFLU for and in their behalf of the complaint in question (Rollo, p. 46). Petitioners insist that their expulsion from the Union and consequent dismissal from employment have no basis whether factual or legal, because they did not in fact affiliate themselves with another Union, the NAFLU. On the contrary, they claim that there is a connivance between respondents Company and Union in their illegal dismissal in order to avoid the payment of separation pay by respondent company. Petitioners' contention that they did not authorize NAFLU to file NLRC-AB Case No. 6-4275-82 for them is borne out by the records which show that they did not sign the complaint, neither did they sign any document of membership application with NAFLU (Rollo, p. 323). Significantly, none of private respondents was able to present any evidence to the contrary except for one employee who admitted having authorized NAFLU to file the complaint but only for the purpose of questioning the funds of the Union (Rollo, p. 216). Placed in proper perspective, the mere act of seeking help from the NAFLU cannot constitute disloyalty as contemplated in the Collective Bargaining Agreement. At most it was an act of self-preservation of workers who, driven to desperation found shelter in the NAFLU who took the cudgels for them. It will be recalled that 460 employees were temporarily laid off; some were laid-off as early as March 22, 1982 although the actual official announcement and notice of the intended shutdown was made only on May 27, 1982 (Rollo, p. 151). The laid-off employees did not receive any separation pay because as alleged by respondent company their dismissal was due to serious business reverses suffered by it. The only aid offered by the company which was offered when the disgruntled employees began to discuss among themselves their plight, was a 1/2 sack of rice monthly and P 50.00 weekly. Most of the employees did not avail themselves of the aid as those who did were allegedly made to sign blank papers. To aggravate matters, petitioners complained that their pleas for their union officers to fight for their right to reinstatement, fell on deaf ears. Their union leaders continued working and were not among those laid-off, which explains the lack of positive action on the part of the latter to help or even sympathize with the plight of the members. All they could offer was a statement "marunong pa kayo sa may-ari ng kumpanya" ("you know more than the company owners") (Rollo, p. 80). Under the circumutances, petitioners cannot be blamed for seeking help wherever it could be found. In fact even assuming that petitioners did authorize NAFLU to file the action for them, it would have been pointless because NAFLU cannot file an action for members of another union. The proper remedy would be to drop the union as party to the action and place the names of the employees instead (Lakas v. Marcelo Enterprises, 118 SCRA 422 [1982]) as what appears to have been done in this case before the Court. Petitioners claim that the NLRC erred in ruling that the expulsion proceeding conducted by the Union was in accordance with its by-laws. Respondent Union had notified and summoned herein petitioners

to appear and explain why they should not be expelled from the union for having joined and affiliated with NAFLU. Petitioners contend that the requisites of due process were not complied with in that, there was no impartial tribunal or union body vested with authority to conduct the disciplinary proceeding under the union constitution and by-laws, and, that complainants were not furnished notice of the charge against them, nor timely notices of the hearings on the same (Rollo, p. 48). According to the minutes of the special meeting of the Board of Directors of respondent Union held on September 14, 1982, the Chairman of the Board of Directors showed the members of the board, copies of the minutes of the investigation proceedings of each individual member, together with a consolidated list of Union members found guilty as charged and recommended for expulsion as members of the respondent Union. The Board members examined the minutes and the list (Rollo, p. 219). It is to be noted, however, that only two (2) of the expelled petitioners appeared before the investigation panel (Rollo, pp. 203, 235). Most of the petitioners boycotted the investigation proceedings. They alleged that most of them did not receive the notice of summons from respondent Union because they were in the provinces. This fact was not disproved by private respondents who were able to present only a sample copy of proof of service, Annex "14" (Rollo, p. 215). Petitioners further claim that they had no Idea that they were charged with disloyalty; those who came were not only threatened with persecution but also made to write the answers to questions as dictated to them by the Union and company representatives. These untoward incidents prompted petitioners to request for a general investigation with all the petitioners present but their request was ignored by the panel of investigators (Rollo, pp. 280, 307). Again, these allegations were not denied by private respondents. In any event, even if petitioners who were complainants in NLRC-AB Case No. 6-4275-82 appeared in the supposed investigation proceedings to answer the charge of disloyalty against them, it could not have altered the fact that the proceedings were violative of the elementary rule of justice and fair play. The Board of Directors of respondent union would have acted as prosecutor, investigator and judge at the same time. The proceeding would have been a farce under the circumstances (Lit Employees Association v. Court of Industrial Relations, 116 SCRA 459 [1982] citing Kapisanan ng Mga Manggagawa sa MRR v. Rafael Hernandez, 20 SCRA 109). The filing of the charge of disloyalty against petitioners was instigated by the Chairman of the Board of Directors and Acting Union President, Ponciano Fernandez, in the special meeting of the members of the Board of Directors as convened by the Union President on August 16, 1982 (Rollo, p. 213). The Panel of Investigators created under the Board's Resolution No. 83, s. 1982 was composed of the Chairman of the Board, Ponciano Fernandez, and two (2) members of the Board, Samson Yap and Carmen Garcia (Rollo, p. 214). It is the same Board that expelled its 125 members in its Resolution No. 84, s. of 1982 (Rollo, p. 219). All told, it is obvious, that in the absence of any full blown investigation of the expelled members of the Union by an impartial body, there is no basis for respondent Union's accusations. It is the policy of the state to assure the right of workers to "security of tenure" (Article XIII, Sec. 3 of the New Constitution, Section 9, Article II of the 1973 Constitution). The guarantee is an act of social justice. When a person has no property, his job may possibly be his only possession or means of livelihood. Therefore, he should be protected against any arbitrary deprivation of his job. Article 280 of the Labor Code has construed security of tenure as meaning that "the employer shall not terminate the services of an employee except for a just cause or when authorized by" the code (Bundoc v. People's Bank and Trust Company, 103 SCRA 599 [1981]). Dismissal is not justified for being arbitrary where the workers were denied due process (Reyes v. Philippine Duplicators, Inc., 109 SCRA 489 [1981] and a clear denial of due process, or constitutional right must be safeguarded against at all times, (De Leon v. National Labor Relations Commission, 100 SCRA 691 [1980]). This is especially true in the case at bar where there were 125 workers mostly heads or sole breadwinners of their respective families.

Time and again, this Court has reminded employers that while the power to dismiss is a normal prerogative of the employer, the same is not without limitations. The employer is bound to exercise caution in terminating the services of his employees especially so when it is made upon the request of a labor union pursuant to the Collective Bargaining Agreement, as in the instant case. Dismissals must not be arbitrary and capricious. Due process must be observed in dismissing an employee because it affects not only his position but also his means of livelihood. Employers should, therefore, respect and protect the rights of their employees, which include the right to labor (Liberty Cotton Mills Workers Union v. Liberty Cotton Mills, Inc., 90 SCRA 393 [1979], Resolution). In the case at bar, the scandalous haste with which respondent corporation dismissed 125 employees lends credence to the claim that there was connivance between respondent corporation and respondent Union. It is evident that private respondents were in bad faith in dismissing petitioners. They, the private respondents, are guilty of unfair labor practice. PREMISES CONSIDERED, (1) the decision of respondent National Labor Relations Commission in NLRC-NCR-11-6881-82 dated April 26, 1984 is REVERSED and SET ASIDE; and (2) respondent corporation is ordered: (1) to reinstate petitioners to their former positions without reduction in rank, seniority and salary; (b) to pay petitioners three-year backwages, without any reduction or qualification, jointly and solidarily with respondent Union; and (c) to pay petitioners exemplary damages of P500.00 each. Where reinstatement is no longer feasible, respondent corporation and respondent union are solidarily ordered to pay, considering their length of service their corresponding separation pay and other benefits to which they are entitled under the law. SO ORDERED.

G.R. No. 70615 October 28, 1986

VIRGILIO vs. CARNATION PHILIPPINES, [NLRC], respondents. Danilo L. Pilapil for petitioner.

CALLANTA, petitioner, INC., and NATIONAL LABOR RELATIONS COMMISSION

FERNAN, J.: The issue raised in this petition for certiorari is whether or not an action for illegal dismissal prescribes in three [3] years pursuant to Articles 291 and 292 of the Labor Code which provide: Art. 291. Offenses. Offenses penalized under this Code and the rules and regulations issued pursuant thereto shall prescribe in three [3] years. xxx xxx xxx Art. 292. Money Claims. All money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three [3] years from the time the cause of action accrued; otherwise, they shall be forever barred. xxx xxx xxx Petitioner Virgilio Callanta was employed by private respondent Carnation Philippines, Inc. [Carnation, for brevity] in January 1974 as a salesman in the Agusan del Sur area. Five [51 years later or on June 1, 1979, respondent Carnation filed with the Regional Office No. X of the Ministry of Labor and Employment [MOLE], an application for clearance to terminate the employment of Virgilio Callanta on the alleged grounds of serious misconduct and misappropriation of company funds amounting to P12,000.00, more or less. Upon approval on June 26, 1979 by MOLE Regional Director Felizardo G. Baterbonia, of said clearance application, petitioner Virgilio Callanta's employment with Carnation was terminated effective June 1, 1979. On July 5, 1982, Virgilio Callanta filed with the MOLE, Regional Office No. X, a complaint for illegal dismissal with claims for reinstatement, backwages, and damages against respondent Carnation. In its position paper dated October 5, 1982, respondent Carnation put in issue the timeliness of petitioner's complaint alleging that the same is barred by prescription for having been filed more than three [3] years after the date of Callanta's dismissal. On March 24, 1983, Labor Arbiter Pedro C. Ramos rendered a decision finding the termination of Callanta's employment to be without valid cause. Respondent Carnation was therefore ordered to reinstate Virgilio Callanta to his former position with backwages of one [1] year without qualification including all fringe benefits provided for by law and company policy, within ten [10] days from receipt of the decision. It was likewise provided that failure on the part of respondent to comply with the decision shall entitle complainant to full backwages and all fringe benefits without loss of seniority rights. On April 18, 1983, respondent Carnation appealed to respondent National Labor Relations Commission [NLRC] which in a decision dated February 25, 1985, 1 set aside the decision of the Labor Arbiter. It declared the complaint for illegal dismissal filed by Virgilio Callanta to have already prescribed. Thus:

Records show that Virgilio Callanta was dismissed from his employment with respondent company effective June 1, 1979; and that on 5 July 1982, he filed the instant complaint against respondent for: Unlawful Dismissal with Backwages, etc. The provisions of the Labor Code applicable are: Art. 291. Offenses. Offenses penalized under this Code and the rules and regulations issued pursuant thereto shall prescribe in three [3] years. Art. 292. Money claims. All money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three [3] years from the time the cause of action accrued; otherwise, they shall be forever barred. Obviously, therefore, the causes of action, i.e., "Unlawful Dismissal" and "Backwages, etc." have already prescribed, the complaint therefore having been filed beyond the three-year period from accrual date. With this finding, there is no need to discuss the other issues raised in the appeal. WHEREFORE, in view of the foregoing, the Decision appealed from is hereby SET ASIDE and another one entered, dismissing the complaint. SO ORDERED. Hence, this petition, which We gave due course in the resolution dated September 18, 1985. 2 Petitioner contends that since the Labor Code is silent as to the prescriptive period of an action for illegal dismissal with claims for reinstatement, backwages and damages, the applicable law, by way of supplement, is Article 1146 of the New Civil Code which provides a four [4]-year prescriptive period for an action predicated upon "an injury to the rights of the plaintiff" considering that an action for illegal dismissal is neither a "penal offense" nor a mere "money claim," as contemplated under Articles 291 and 292, respectively, of the Labor Code. Petitioner further claims that an action for illegal dismissal is a more serious violation of the rights of an employee as it deprives him of his means of livelihood; thus, it should correspondingly have a prescriptive period longer than the three 13] years provided for in "money claims." Public respondent, on the other hand, counters with the arguments that a case for illegal dismissal falls under the general category of "offenses penalized under this Code and the rules and regulations pursuant thereto" provided under Article 291 or a money claim under Article 292, so that petitioner's complaint for illegal dismissal filed on July 5, 1982, or three [3] years, one [1] month and five [5] days after his alleged dismissal on June 1, 1979, was filed beyond the three-year prescriptive period as provided under Articles 291 and 292 of the Labor Code, hence, barred by prescription; that while it is admittedly a more serious offense as it involves an employee's means of livelihood, there is no logic in assuming that it has a longer prescriptive period, as naturally, one who is truly aggrieved would immediately seek the redress of his grievance; that assuming arguendo that the law does not provide for a prescriptive period for the enforcement of petitioner's right, it is nevertheless beyond dispute that the said right has already lapsed into a stale demand; and that considering the seriousness of the act committed by petitioner, private respondent was justified in terminating the employment. We find for petitioner. Verily, the dismissal without just cause of an employee from his employment constitutes a violation of the Labor Code and its implementing rules and regulations. Such violation, however, does not amount to an "offense" as understood under Article 291 of the Labor Code. In its broad sense, an offense is an illegal act which does not amount to a crime as defined in the penal law, but which by statute carries

with it a penalty similar to those imposed by law for the punishment of a crime. 3 It is in this sense that a general penalty clause is provided under Article 289 of the Labor Code which provides that "... any violation of the provisions of this code declared to be unlawful or penal in nature shall be punished with a fine of not less than One Thousand Pesos [P1,000.00] nor more than Ten Thousand Pesos [10,000.00], or imprisonment of not less than three [3] months nor more than three [3] years, or both such fine and imprisonment at the discretion of the court." [Emphasis supplied.] The confusion arises over the use of the term "illegal dismissal" which creates the impression that termination of an employment without just cause constitutes an offense. It must be noted, however that unlike in cases of commission of any of the probihited activities during strikes or lockouts under Article 265, unfair labor practices under Article 248, 249 and 250 and illegal recruitment activities under Article 38, among others, which the Code itself declares to be unlawful, termination of an employment without just or valid cause is not categorized as an unlawful practice. Besides, the reliefs principally sought by an employee who was illegally dismissed from his employment are reinstatement to his former position without loss of seniority rights and privileges, if any, backwages and damages, in case there is bad faith in his dismissal. As an affirmative relief, reinstatement may be ordered, with or without backwages. While ordinarily, reinstatement is a concomitant of backwages, the two are not necessarily complements, nor is the award of one a condition precedent to an award of the other. 4 And, in proper cases, backwages may be awarded without ordering reinstatement . In either case, no penalty of fine nor improsonment is imposed on the employer upon a finding of illegality in the dismissal. By the very nature of the reliefs sought, therefore, an action for illegal dismissal cannot be generally categorized as an "offense" as used under Article 291 of the Labor Code, which according to public respondent, must be brought within the period of three[3] years from the time the cause of action accrued, otherwise, the same is forever barred. It is true that the "backwwages" sought by an illegally dismissed employee may be considered, by reason of its practical effect, as a "money claim." However, it is not the principal cause of action in an illegal dismissal case but the unlawful deprivation of the one's employment committed by the employer in violation of the right of an employee. Backwages is merely one of the reliefs which an illegally dismissed employee prays the labor arbiter and the NLRC to render in his favor as a consequence of the unlawful act committed by the employer. The award thereof is not private compensation or damages 5but is in furtherance and effectuation of the public objectives of the Labor Code. 6 even though the practical effect is the enrichment of the individual, the award of backwages is not inredness of a private right, but, rather, is in the nature of a command upon the employer to make public reparation for his violation of the Labor Code. 7 The case of Valencia vs. Cebu Portland Cement, et al., 106 Phil. 732, a 1959 case cited by petitioner, is applicable in the instant case insofar as it concerns the issue of prescription of actions. In said case, this Court had occasion to hold that an action for damages involving a plaintiff seperated from his employment for alleged unjustifiable causes is one for " injury to the rights of the plaintiff, and must be brought within four [4] years. 8 In Santos vs. Court of Appeals, 96 SCRA 448 [1980], this Court, thru then Chief Justice Enrique M. Fernando, sustained the sand of the Solicitor General that the period of prescription mentioned under Article 281, now Article 292, of the Labor Code, refers to and "is limited to money claims, an other cases of injury to rights of a workingman being governed by the Civil Code." Accordingly, this Court ruled that petitioner Marciana Santos, who sought reinstatement, had four [4] years within which to file her complaint for the injury to her rights as provided under Article 1146 of the Civil Code. Indeed there is, merit in the contention of petitioner that the four [4]-year prescriptive period under Article 1146 of the New Civil Code, applies by way of supplement, in the instant case, to wit: Art. 1146. The following actions must be instituted within four years. [1] Upon an injury to the lights of the plaintiff.

xxx xxx xxx [Emphasis supplied] As this Court stated in Bondoc us. People's Bank and Trust Co., 9 when a person has no property, his job may possibly be his only possession or means of livelihood, hence, he should be protected against any arbitrary and unjust deprivation of his job. Unemployment, said the Court in Almira vs. B.F. Goodrich Philippines, 10 brings "untold hardships and sorrows on those dependent on the wage earners. The misery and pain attendant on the loss of jobs thus could be avoided if there be acceptance of the view that under all the circumstances of this case, petitioners should not be deprived of their means of livelihood." It is a principle in American jurisprudence which, undoubtedly, is well-recognized in this jurisdiction that one's employment, profession, trade or calling is a "property right," and the wrongful interference therewith is an actionable wrong. 11 The right is considered to be property within the protection of a constitutional guaranty of due process of law. 12 Clearly then, 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 Art. 1146 of the New Civil Code, which must be brought within four [4] years. In the instant case, the action for illegal dismissal was filed by petitioners on July 5, 1982, or three [3] years, one [1] month and five [5] days after the alleged effectivity date of his dismissal on June 1, 1979 which is well within the four [4]-year prescriptive period under Article 1146 of the New Civil Code. Even on the assumption that an action for illegal dismissal falls under the category of "offenses" or "money claims" under Articles 291 and 292, Labor Code, which provide for a three-year prescriptive period, still, a strict application of said provisions will not destroy the enforcement of fundamental rights of the employees. As a statutory provision on limitations of actions, Articles 291 and 292 go to matters of remedy and not to the destruction of fundamental rights. 13 As a general rule, a statute of limitation extinguishes the remedy only. Although the remedy to enforce a right may be barred, that right may be enforced by some other available remedy which is not barred. 14 More so, in the instant case, where the delay in filing the case was with justifiable cause. The threat to petitioner that he would be charged with estafa if he filed a complaint for illegal dismissal, which private respondent did after all on June 22, 1981, justifies, the delayed filing of the action for illegal dismissal with the Regional Office No. X, MOLE on July 5, 1982. Laches will not in that sense strengthen the cause of public respondent. Besides, it is deemed waived as it was never alleged before the Labor Arbiter nor the NLRC. Public respondent dismissed the action for illegal dismissal on the sole issue of prescription of actions. It did not resolve the case of illegal dismissal on the merits. Nonetheless, to resolve once and for all the issue of the legality of the dismissal, We find that petitioner, who has continuously served respondent Carnation for five [5] years was, under the attendant circumstances, arbitrarily dismissed from his employment. The alleged shortage in his accountabilities should have been impartially investigated with all due regard for due process in view of the admitted enmity between petitioner and E.L. Corsino, respondent's auditor. 15 Absent such an impartial investigation, the alleged shortage should not have been attended with such a drastic consequence as termination of the employment relationship. Outright dismissal was too severe a penalty for a first offense, considering that the alleged shortage was explained to respondent's Auditor, E.L. Corsino, in accordance with respondent's accounting and auditing policies. The indecent haste of his dismissal from employment was, in fact, aggravated by the filing of the estafa charge against petitioner with the City Fiscal of Butuan City on June 22, 1981, or two [2] years after his questioned dismissal. After the case had remained pending for five [5] years, the Regional Trial Court of Agusan del Norte and Butuan City, Branch V finally dismissed the same provisionally in

an order dated February 21, 1986 for failure of the prosecution's principal witness to appear in court. Admittedly, loss of trust and confidence arising from the same alleged misconduct is sufficient ground for dismissing an employee from his employment despite the dismissal of the criminal case. 16 However, it must not be indiscriminately used as a shield to dismiss an employee arbitrarily. 17 For, who can stop the employer from filing all the charges in the books for the simple exercise of it, and then hide behind the pretext of loss of confidence which can be proved by mere preponderance of evidence. We grant the petition and the decision of the NLRC is hereby reversed and set aside. Although We are strongly inclined to affirm that part of the decision of the Labor Arbiter ordering the reinstatement of petitioner to his former position without loss of seniority rights and privileges, a supervening event, which petitioner mentioned in his motion for early decision dated January 6, 1986 18 that is, FILIPRO, Inc.'s taking over the business of Carnation, has legally rendered the order of reinstatement difficult to enforce, unless there is an express agreement on assumption of liabilities 19 by the purchasing corporation, FILIPRO, Inc. Besides, there is no law requiring that the purchasing corporation should absorb the employees of the selling corporation. 20 In any case, the very concept of social justice dictates that petitioner shall be entitled to backwages of three [3] years. 21 WHEREFORE, respondent Carnation Philippines, Inc. is hereby ordered to pay petitioner Virgilio Callanta backwages for three [3] years without qualification and deduction. This decision is immediately executory. No costs.

G.R. No. 144664

March 15, 2004

ASIAN TRANSMISSION CORPORATION, petitioner, vs. The Hon. COURT OF APPEALS, Thirteenth Division, HON. FROILAN M. BACUNGAN as Voluntary Arbitrator, KISHIN A. LALWANI, Union, Union representative to the Panel Arbitrators; BISIG NG ASIAN TRANSMISSION LABOR UNION (BATLU); HON. BIENVENIDO T. LAGUESMA in his capacity as Secretary of Labor and Employment; and DIRECTOR CHITA G. CILINDRO in her capacity as Director of Bureau of Working Conditions, respondents. DECISION CARPIO-MORALES, J.: Petitioner, Asian Transmission Corporation, seeks via petition for certiorari under Rule 65 of the 1995 Rules of Civil Procedure the nullification of the March 28, 2000 Decision 1 of the Court of Appeals denying its petition to annul 1) the March 11, 1993 "Explanatory Bulletin" 2 of the Department of Labor and Employment (DOLE) entitled "Workers Entitlement to Holiday Pay on April 9, 1993, Araw ng Kagitingan and Good Friday", which bulletin the DOLE reproduced on January 23, 1998, 2) the July 31, 1998 Decision3 of the Panel of Voluntary Arbitrators ruling that the said explanatory bulletin

applied as well to April 9, 1998, and 3) the September 18, 1998 4 Resolution of the Panel of Voluntary Arbitration denying its Motion for Reconsideration. The following facts, as found by the Court of Appeals, are undisputed: The Department of Labor and Employment (DOLE), through Undersecretary Cresenciano B. Trajano, issued an Explanatory Bulletin dated March 11, 1993 wherein it clarified, inter alia, that employees are entitled to 200% of their basic wage on April 9, 1993, whether unworked, which[,] apart from being Good Friday [and, therefore, a legal holiday], is also Araw ng Kagitingan [which is also a legal holiday]. The bulletin reads: "On the correct payment of holiday compensation on April 9, 1993 which apart from being Good Friday is alsoAraw ng Kagitingan, i.e., two regular holidays falling on the same day, this Department is of the view that the covered employees are entitled to at least two hundred percent (200%) of their basic wage even if said holiday is unworked. The first 100% represents the payment of holiday pay on April 9, 1993 as Good Friday and the second 100% is the payment of holiday pay for the same date as Araw ng Kagitingan. Said bulletin was reproduced on January 23, 1998, when April 9, 1998 was both Maundy Thursday and Araw ng Kagitingan x x x x Despite the explanatory bulletin, petitioner [Asian Transmission Corporation] opted to pay its daily paid employees only 100% of their basic pay on April 9, 1998. Respondent Bisig ng Asian Transmission Labor Union (BATLU) protested. In accordance with Step 6 of the grievance procedure of the Collective Bargaining Agreement (CBA) existing between petitioner and BATLU, the controversy was submitted for voluntary arbitration. x x x x On July 31, 1998,the Office of the Voluntary Arbitrator rendered a decision directing petitioner to pay its covered employees "200% and not just 100% of their regular daily wages for the unworked April 9, 1998 which covers two regular holidays, namely, Araw ng Kagitignan and Maundy Thursday." (Emphasis and underscoring supplied) Subject of interpretation in the case at bar is Article 94 of the Labor Code which reads: ART. 94. Right to holiday pay. - (a) Every worker shall be paid his regular daily wage during regular holidays, except in retail and service establishments regularly employing less than ten (10) workers; (b) The employer may require an employee to work on any holiday but such employee shall be paid a compensation equivalent to twice his regular rate; and (c) As used in this Article, "holiday" includes: New Years Day, Maundy Thursday, Good Friday, the ninth of April, the first of May, the twelfth of June, the fourth of July, the thirtieth of November, the twenty-fifth and thirtieth of December and the day designated by law for holding a general election, which was amended by Executive Order No. 203 issued on June 30, 1987, such that the regular holidays are now: 1. New Years Day January 1 2. Maundy Thursday Movable Date 3. Good Friday Movable Date 4. Araw ng Kagitingan April 9 (Bataan and Corregidor Day)

5. Labor Day May 1 6. Independence Day June 12 7. National Heroes Day Last Sunday of August 8. Bonifacio Day November 30 9. Christmas Day December 25 10. Rizal Day December 30 In deciding in favor of the Bisig ng Asian Transmission Labor Union (BATLU), the Voluntary Arbitrator held that Article 94 of the Labor Code provides for holiday pay for every regular holiday, the computation of which is determined by a legal formula which is not changed by the fact that there are two holidays falling on one day, like on April 9, 1998 when it was Araw ng Kagitingan and at the same time was Maundy Thursday; and that that the law, as amended, enumerates ten regular holidays for every year should not be interpreted as authorizing a reduction to nine the number of paid regular holidays "just because April 9 (Araw ng Kagitingan) in certain years, like 1993 and 1998, is also Holy Friday or Maundy Thursday." In the assailed decision, the Court of Appeals upheld the findings of the Voluntary Arbitrator, holding that the Collective Bargaining Agreement (CBA) between petitioner and BATLU, the law governing the relations between them, clearly recognizes their intent to consider Araw ng Kagitingan and Maundy Thursday, on whatever date they may fall in any calendar year, as paid legal holidays during the effectivity of the CBA and that "[t]here is no condition, qualification or exception for any variance from the clear intent that all holidays shall be compensated."5 The Court of Appeals further held that "in the absence of an explicit provision in law which provides for [a] reduction of holiday pay if two holidays happen to fall on the same day, any doubt in the interpretation and implementation of the Labor Code provisions on holiday pay must be resolved in favor of labor." By the present petition, petitioners raise the following issues: I WHETHER OR NOT THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION IN ERRONEOUSLY INTERPRETING THE TERMS OF THE COLLECTIVE BARGAINING AGREEMENT BETWEEN THE PARTIES AND SUBSTITUTING ITS OWN JUDGMENT IN PLACE OF THE AGREEMENTS MADE BY THE PARTIES THEMSELVES II WHETHER OR NOT THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION IN HOLDING THAT ANY DOUBTS ABOUT THE VALIDITY OF THE POLICIES ENUNCIATED IN THE EXPLANATORY BULLETIN WAS LAID TO REST BY THE REISSUANCE OF THE SAID EXPLANATORY BULLETIN III WHETHER OR NOT THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION IN UPHOLDING THE VALIDITY OF THE EXPLANATORY BULLETIN EVEN WHILE ADMITTING THAT THE SAID BULLEITN WAS NOT AN EXAMPLE OF A JUDICIAL, QUASI-JUDICIAL, OR ONE OF THE RULES AND REGULATIONS THAT [Department of Labor and Employment] DOLE MAY PROMULGATE

IV WHETHER OR NOT THE SECRETARY OF THE DEPARTMENT OF LABOR AND EMPLOYMENT (DOLE) BY ISSUING EXPLANATORY BULLETIN DATED MARCH 11, 1993, IN THE GUISE OF PROVIDING GUIDELINES ON ART. 94 OF THE LABOR CODE, COMMITTED GRAVE ABUSE OF DISCRETION, AS IT LEGISLATED AND INTERPRETED LEGAL PROVISIONS IN SUCH A MANNER AS TO CREATE OBLIGATIONS WHERE NONE ARE INTENDED BY THE LAW V WHETHER OR NOT THE RESPONDENT COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION IN SUSTAINING THE SECRETARY OF THE DEPARTMENT OF LABOR IN REITERATING ITS EXPLANATORY BULLETIN DATED MARCH 11, 1993 AND IN ORDERING THAT THE SAME POLICY OBTAINED FOR APRIL 9, 1998 DESPITE THE RULINGS OF THE SUPREME COURT TO THE CONTRARY VI WHETHER OR NOT RESPONDENTS ACTS WILL DEPRIVE PETITIONER OF PROPERTY WITHOUT DUE PROCESS BY THE "EXPLANATORY BULLETIN" AS WELL AS EQUAL PROTECTION OF LAWS The petition is devoid of merit. At the outset, it bears noting that instead of assailing the Court of Appeals Decision by petition for review oncertiorari under Rule 45 of the 1997 Rules of Civil Procedure, petitioner lodged the present petition for certiorari under Rule 65. [S]ince the Court of Appeals had jurisdiction over the petition under Rule 65, any alleged errors committed by it in the exercise of its jurisdiction would be errors of judgment which are reviewable by timely appeal and not by a special civil action of certiorari. If the aggrieved party fails to do so within the reglementary period, and the decision accordingly becomes final and executory, he cannot avail himself of the writ of certiorari, his predicament being the effect of his deliberate inaction. The appeal from a final disposition of the Court of Appeals is a petition for review under Rule 45 and not a special civil action under Rule 65 of the Rules of Court, now Rule 45 and Rule 65, respectively, of the 1997 Rules of Civil Procedure. Rule 45 is clear that the decisions, final orders or resolutions of the Court of Appeals in any case, i.e., regardless of the nature of the action or proceeding involved, may be appealed to this Court by filing a petition for review, which would be but a continuation of the appellate process over the original case. Under Rule 45 the reglementary period to appeal is fifteen (15) days from notice of judgment or denial of motion for reconsideration. xxx For the writ of certiorari under Rule 65 of the Rules of Court to issue, a petitioner must show that he has no plain, speedy and adequate remedy in the ordinary course of law against its perceived grievance. A remedy is considered "plain, speedy and adequate" if it will promptly relieve the petitioner from the injurious effects of the judgment and the acts of the lower court or agency. In this case, appeal was not only available but also a speedy and adequate remedy.6 The records of the case show that following petitioners receipt on August 18, 2000 of a copy of the August 10, 2000 Resolution of the Court of Appeals denying its Motion for Reconsideration, it filed the present petition for certiorari on September 15, 2000, at which time the Court of Appeals decision had become final and executory, the 15-day period to appeal it under Rule 45 having expired. Technicality aside, this Court finds no ground to disturb the assailed decision.

Holiday pay is a legislated benefit enacted as part of the Constitutional imperative that the State shall afford protection to labor.7 Its purpose is not merely "to prevent diminution of the monthly income of the workers on account of work interruptions. In other words, although the worker is forced to take a rest, he earns what he should earn, that is, his holiday pay."8 It is also intended to enable the worker to participate in the national celebrations held during the days identified as with great historical and cultural significance. Independence Day (June 12), Araw ng Kagitingan (April 9), National Heroes Day (last Sunday of August), Bonifacio Day (November 30) and Rizal Day (December 30) were declared national holidays to afford Filipinos with a recurring opportunity to commemorate the heroism of the Filipino people, promote national identity, and deepen the spirit of patriotism. Labor Day (May 1) is a day traditionally reserved to celebrate the contributions of the working class to the development of the nation, while the religious holidays designated in Executive Order No. 203 allow the worker to celebrate his faith with his family. As reflected above, Art. 94 of the Labor Code, as amended, affords a worker the enjoyment of ten paid regular holidays.9 The provision is mandatory,10 regardless of whether an employee is paid on a monthly or daily basis.11Unlike a bonus, which is a management prerogative,12 holiday pay is a statutory benefit demandable under the law. Since a worker is entitled to the enjoyment of ten paid regular holidays, the fact that two holidays fall on the same date should not operate to reduce to nine the ten holiday pay benefits a worker is entitled to receive. It is elementary, under the rules of statutory construction, that when the language of the law is clear and unequivocal, the law must be taken to mean exactly what it says. 13 In the case at bar, there is nothing in the law which provides or indicates that the entitlement to ten days of holiday pay shall be reduced to nine when two holidays fall on the same day. Petitioners assertion that Wellington v. Trajano14 has "overruled" the DOLE March 11, 1993 Explanatory Bulletin does not lie. In Wellington, the issue was whether monthly-paid employees are entitled to an additional days pay if a holiday falls on a Sunday. This Court, in answering the issue in the negative, observed that in fixing the monthly salary of its employees, Wellington took into account "every working day of the year including the holidays specified by law and excluding only Sunday." In the instant case, the issue is whether daily-paid employees are entitled to be paid for two regular holidays which fall on the same day.15 In any event, Art. 4 of the Labor Code provides that all doubts in the implementation and interpretation of its provisions, including its implementing rules and regulations, shall be resolved in favor of labor. For the working mans welfare should be the primordial and paramount consideration.16 Moreover, Sec. 11, Rule IV, Book III of the Omnibus Rules to Implement the Labor Code provides that "Nothing in the law or the rules shall justify an employer in withdrawing or reducing any benefits, supplements or payments for unworked regular holidays as provided in existing individual or collective agreement or employer practice or policy."17 From the pertinent provisions of the CBA entered into by the parties, petitioner had obligated itself to pay for the legal holidays as required by law. Thus, the 1997-1998 CBA incorporates the following provision: ARTICLE PAID LEGAL HOLIDAYS The following legal holidays shall be paid by the COMPANY as required by law: 1. New Years Day (January 1st) 2. Holy Thursday (moveable) XIV

3. Good Friday (moveable) 4. Araw ng Kagitingan (April 9th) 5. Labor Day (May 1st) 6. Independence Day (June 12th) 7. Bonifacio Day [November 30] 8. Christmas Day (December 25th) 9. Rizal Day (December 30th) 10. General Election designated by law, if declared public non-working holiday 11. National Heroes Day (Last Sunday of August) Only an employee who works on the day immediately preceding or after a regular holiday shall be entitled to the holiday pay. A paid legal holiday occurring during the scheduled vacation leave will result in holiday payment in addition to normal vacation pay but will not entitle the employee to another vacation leave. Under similar circumstances, the COMPANY will give a days wage for November 1st and December 31st whenever declared a holiday. When required to work on said days, the employee will be paid according to Art. VI, Sec. 3B hereof.18 WHEREFORE, the petition is hereby DISMISSED

The Case

Before us is a Petition for Review[1] under Rule 45 of the Rules of Court, seeking to set aside the July 27, 2001 Decision[2] and the January 29, 2002 Resolution[3] of the Court of Appeals (CA) in CA-GR SP No. 50679. The dispositive portion of the Decision reads as follows:

WHEREFORE, premises considered, the decision dated May 30, 1997 of public respondent is hereby ANNULLED and SET ASIDEand the decision, dated February 27, 1997 of Labor Arbiter Andres Zavalla is REINSTATED and AFFIRMED in toto. Costs against [herein petitioners].[4]

The assailed Resolution denied petitioners' Motion for Reconsideration.

Land and housing corporation vs Esquillo The Facts The antecedents are narrated by the CA as follows: [Respondent] Marianito C. Esquillo was hired as a structural engineer by [Petitioner] ABV Rock Group (ABV') based in Jeddah, Kingdom of Saudi Arabia. He commenced employment on July 27, 1989, with an initial monthly salary of US$1,000.00 that was gradually increased, on account of his good performance and the annual renewal of his employment contract, until it reached US$1,300.00. Private respondent Land & Housing Development Corporation (LHDC'), a local placement agency, facilitated [respondent's ] employment papers.

Although [respondent's ] employment contract was supposed to be valid until July 26, 1995, it was pre-terminated, through an Inter-Office Memo on Notice of Termination, dated November 17, 1994, allegedly, for the reason, 'reduction of force. Petitioner however, claims that the reason adduced was 'negated by the fact that a lot of transferees from other sites were taken in and promotions as well as re-classifications in the lower ranks were done as shown by the list of fifteen (15) transferees from Riyadh effective November 5, 1994, as well as letters of

promotion and re-classification. He further claimed that [Petitioner] ABV maliciously confiscated his 'iqama or resident visa despite the fact that it was [respondent's ] previous employer, FEAL IBC., which secured his 'iqama. Consequently, [respondent] was prevented from getting another job in Jeddah.

[Respondent] subsequently received the amount of twenty-three thousand, one hundred fiftythree Saudi Riyals (SR23,153.00) from [Petitioner] ABV, as final settlement of his claims and was issued an exit visa that required him to immediately go back to the Philippines.

As a result of the foregoing, [respondent] filed a complaint for breach of contract and/or illegal dismissal, before the Philippine Overseas Employment Administration which was referred to the National Labor Relations Commission, Sub-Regional Arbitration Branch No. IV, San Pablo City, and docketed as SRAB-IV-4-0053-96-L. The parties were required to file their position papers and responsive pleadings.

In their position paper, [petitioners] maintained that [respondent's ] dismissal was for valid cause, that is, reduction of force. Due to the Gulf War, the projects of [Petitioner] ABV were reduced and it was forced to 'terminate the contracts of workers whose job were not so immediate and urgent and retain only those workers whose skills were needed just to maintain the projects. [Respondent] was informed, one month in advance, of the pretermination of his contract, and he was paid his salary, overtime pay, bonus and other benefits in the total amount of US$6,716.00 or Saudi Riyals SR25,192.00. With respect to the alleged confiscation of [respondent's ] iqama, [petitioners] alleged that the law requires its surrender to the Saudi authorities upon the termination of the employee's contract of employment.

Upon the submission of the case for resolution, the Hon. Labor Arbiter Andres Zavalla issued his Decision, dated February 27, 1997, decreeing, as follows:

WHEREFORE, premises considered, judgment is hereby rendered ordering [petitioners] jointly and severally to pay [respondent] his salaries corresponding to the unexpired portion of his contract from December 19, 1994 up to July 26, 1995 in the total amount of NINE THOUSAND FOUR HUNDRED FORTY SEVEN U.S. Dollars (US$9,447.00) and ten percent (10%) of his monetary award as attorney's fees both in Philippine currency to be computed at the prevailing rate at the time of payment. All other claims of [respondent] are hereby dismissed for lack of merit. SO ORDERED.

When [petitioners] filed their joint appeal, docketed as NLRC NCR CA No. 012650-97, [the NLRC] in a Decision, dated May 30, 1997, reversed the aforecited decision and dismissed the

[respondent's ] complaint for lack of merit. [Respondent's ] motion for reconsideration was denied in a Resolution, dated July 10, 1997.[5]

Ruling of the Court of Appeals

The Court of Appeals ruled that despite the absence of a written categorical objection to the sufficiency of the payment received as consideration for the execution of the quitclaim,

jurisprudence supported the right of respondent to demand what was rightfully his under our labor laws. Hence, he should have been allowed to recover the difference between the amount he had actually received and the amount he should have received.

The CA also found that the NLRC had erroneously applied RA 8042 to the case. The appellate court held that respondent was entitled to the salaries corresponding to the unexpired portion of his Contract, in addition to what he had already received.

Hence, this Petition.[6]

The Issues Petitioners raise the following issues for this Court's consideration: A. Whether or not the Honorable Court of Appeals committed reversible error when it took cognizance of an issue of fact which was raised for the first time on appeal. B. Whether or not the Honorable Court of Appeals committed reversible error in its 27 July 2001 Decision and 29 January 2002 Resolution by affirming the 27 February 1997 Decision of the Labor Arbiter which rendered as null and void and without binding effect the release and quitclaim executed by the respondent in favor of the petitioners, and, thereafter, granted the respondent monetary award.[7] In the main, the issue is whether respondent, despite having executed a quitclaim, is entitled to a grant of his additional monetary claims. The Court's Ruling The Petition has no merit.

At the outset, the Court notes the Manifestation of the Office of the Solicitor General (OSG), recommending that the decision dated May 30, 1997 of the NLRC be annulled and set aside and that

[Respondent] Esquillo be awarded the total amount of his salaries corresponding to the unexpired portion of his contract of employment. Main Issue: Entitlements of a Dismissed Employee Who Has Executed a Quitclaim The factual findings of labor officials, who are deemed to have acquired expertise in matters within their respective jurisdictions, are generally accorded not only respect but finality.[9] In the present case, the labor arbiter found respondent's dismissal to be illegal and devoid of any just or authorized cause. The factual findings of the NLRC and the CA on this matter were not contradictory. Hence, the Court finds no reason to deviate from their factual finding that respondent was dismissed without any legal cause.

Indeed, an employee cannot be dismissed except for cause, as provided by law, and only after due notice and hearing Employees who are dismissed without cause have the right to be reinstated without loss of seniority rights and other privileges; and to be paid full back wages, inclusive of allowances and other benefits, plus proven damages. With regard to contract workers, in cases arising before the effectivity of RA 8042 (the Migrant Workers and Overseas Filipinos Act[11]), it is settled that if 'the contract is for a fixed term and the employee is dismissed without just cause, he is entitled to the payment of his salaries corresponding to the unexpired portion of his contract.[12] In the present case, the Contract of respondent was until July 26, 1995. Since his dismissal from service effective December 18, 1994, was not for a just cause, he is entitled to be paid his salary corresponding to the unexpired portion of his Contract, in the total amount of US$9,447.

We now go to the Release and Quitclaim signed by respondent. The document, which was prepared by Petitioner ABV Rock Group,[13] states:

KNOW ALL MEN BY THESE PRESENTS:

That for and in consideration of the sum of Saudi Riyals SR: TWENTY THREE THOUSAND ONE HUNDRED FIFTY THREE (SR23,153) receipt of which is hereby acknowledged to my full and complete satisfaction, I,MARIANITO C. ESQUILLO do discharge my employer, ABV ROCK GROUP KB, JEDDAH, & its recruitment agent, the LAND & HOUSING DEVP. CORP., from any and all claims, demands, debts, dues, actions, or causes of action, arising from my employment with aforesaid company/firm/entity.

'I hereby certify that I am of legal age, that I fully understand this instrument and agree that this is a full and final release and discharge of the parties referred to herein, and I further agree that this release may be pleaded as absolute and final bar to any suit or suits or legal proceedings that may hereafter be prosecuted by me against aforementioned

companies/entities.

IN WITNESS WHEREOF, I HAVE HEREUNTO SET MY HANDS THIS 29 day of NOV, 1994 'at JEDDAH.

SIGNED

MARIANITO C. ESQUILLO.[14]

Petitioners claim that the foregoing Release and Quitclaim has forever released them from 'any and all claims, demands, dues, actions, or causes of action arising from respondent's employment with them. They also contend that the validity of the document can no longer be questioned.

Unfortunately for petitioners, jurisprudence does not support their stance. The fact that employees have signed a release and/or quitclaim does not necessarily result in the waiver of their claims. The law strictly scrutinizes agreements in which workers agree to receive less compensation than what they are legally entitled to. That document does not always bar them from demanding benefits to which they are legally entitled.[15] The reason for this policy was explained, inter alia, in Marcos v. National Labor Relations Commission, which we quote:

We have heretofore explained that the reason why quitclaims are commonly frowned upon as contrary to public policy, and why they are held to be ineffective to bar claims for the full measure of the workers' legal rights, is the fact that the employer and the employee obviously do not stand on the same footing. The employer drove the employee to the wall. The latter must have to get hold of money. Because, out of a job, he had to face the harsh necessities of life. He thus found himself in no position to resist money proffered. His, then, is a case of adherence, not of choice. One thing sure, however, is that petitioners did not relent on their claim. They pressed it. They are deemed not [to] have waived any of their rights. Renuntiatio non praesumitur.

Along this line, we have more trenchantly declared that quitclaims and/or complete releases executed by the employees do not estop them from pursuing their claims arising from unfair labor practices of the employer. The basic reason for this is that such quitclaims and/or complete releases are against public policy and, therefore, null and void. The acceptance of termination does not divest a laborer of the right to prosecute his employer for unfair labor practice acts. While there may be possible exceptions to this holding, we do not perceive any in the case at bar.

xxxxxxxxx

We have pointed out in Veloso, et al. vs. Department of Labor and Employment, et al., that:

While rights may be waived, the same must not be contrary to law, public order, public policy, morals or good customs or prejudicial to a third person with a right recognized by law.

Article 6 of the Civil Code renders a quitclaim agreement void ab initio where the quitclaim obligates the workers concerned to forego their benefits while at the same time exempting the employer from any liability that it may choose to reject. This runs counter to Art. 22 of the Civil Code which provides that no one shall be unjustly enriched at the expense of another.[16]

In Periquet v. NLRC, this Court set the guidelines and the current doctrinal policy regarding quitclaims and waivers, as follows:

Not all waivers and quitclaims are invalid as against public policy. If the agreement was voluntarily entered into and represents a reasonable settlement, it is binding on the parties and may not later be disowned simply because of a change of mind. It is only where there is clear proof that the waiver was wangled from an unsuspecting or gullible person, or the terms of settlement are unconscionable on its face, that the law will step in to annul the questionable

transaction. But where it is shown that the person making the waiver did so voluntarily, with full understanding of what he was doing, and the consideration for the quitclaim is credible and reasonable, the transaction must be recognized as a valid and binding undertaking.[17]

Hence, quitclaims in which employees voluntarily accept a reasonable amount or consideration as settlement are deemed valid. These agreements cannot be set aside merely because the parties have subsequently changed their minds.[18] Consistent with this doctrine, a tribunal has the duty of scrutinizing quitclaims brought to its attention by either party, in order to determine their validity.

In the present case, petitioners themselves offered the Release and Quitclaim as a defense. Even though respondent -- in his pleadings before the labor arbiter -- was silent on the matter, he nonetheless filed this case and questioned his dismissal immediately, a few days after setting foot in the Philippines. In asking for payment for the unexpired portion of his employment Contract, he was eloquently taking issue with the validity of the quitclaim. His actions spoke loudly enough; words were not necessary.

To determine whether the Release and Quitclaim is valid, one important factor that must be taken into account is the consideration accepted by respondent; the amount must constitute a 'reasonable settlement. The NLRC considered the amount of 'US$6,716 or SR23,153 reasonable, when compared with (1) $3,900, the three-month salary that he would have been entitled to recover if RA 8042 were applied; and (2) US$9,447, his salaries for the unexpired portion of his Contract.

It is relevant to point out, however, that respondent was dismissed prior to the effectivity of RA 8042. As discussed at the outset, he is entitled to his salaries corresponding to the unexpired portion of his Contract. This amount is exclusive of the SR23,153 that he received based on the November 29, 1994 Final Settlement. The latter amount was comprised of overtime pay, vacation pay, indemnity, contract reward and notice pay -- items that were due him under his employment Contract. For these reasons, the consideration stated in the Release and Quitclaim cannot be deemed a reasonable settlement; hence, that agreement must be set aside.

That respondent is a professional structural engineer did not make him less susceptible to disadvantageous financial offers, faced as he was with the prospect of unemployment in a country not his own. 'This Court has allowed supervisory employees to seek payment of benefits and a manager to sue for illegal dismissal even though, for a consideration, they executed deeds of quitclaims releasing their employers from liability.[19]

To stress, 'in case of doubt, laws should be interpreted to favor the working class -- whether in the government or in the private sector -- in order to give flesh and vigor to the pro-poor and pro-labor provisions of our Constitution.[20]

WHEREFORE, the Petition is DENIED and the assailed Decision and Resolution AFFIRMED . Costs against petitioners.

G.R. No. 101535 January 22, 1993 PHILIPPINE NATIONAL CONSTRUCTION CORPORATION, petitioner, vs. THE HONORABLE NATIONAL LABOR RELATIONS COMMISSION, SECOND DIVISION, PHILIPPINE OVERSEAS EMPLOYMENT ADMINISTRATION, RAUL ABRICO, RODRIGO VASALLO, EDUARDO A. SIBBALUCA, and BENIGNO M. MANASIS, respondents. Office of the Government Corporate Counsel for petitioner. Apolinar L. Sevilla for private respondents.

CAMPOS, JR., J.: Subject of this petition is the Resolution ** of the National Labor Relations Commission (NLRC) affirming the decision of the Philippine Overseas Employment Administration (POEA) which held herein petitioner Philippine National Construction Corporation (PNCC) liable to private respondents Raul Abrico, Rodrigo Vasallo, Eduardo A. Sibbaluca, and Benigno M. Manasis for salary, overtime pay, vacation and sick leave, and completion bonus differentials. The facts are as follows: Herein private respondents Raul C. Abrico, Rodrigo Vasallo, Eduardo A. Sibbaluca, and Benigno M. Manasis were deployed by herein petitioner for overseas employment to Iraq as security guards pursuant to individual appointment contracts dated April 15, 1985. These were submitted to the POEA and were validated by the latter on April 22, 1985. The contracts provided for a US$350.00/month salary. However, on May 12, 1985, a second overseas contract was executed by the PNCC which was accepted by private respondents. It modified the April 15, 1985 contract by providing for a monthly salary of US$260.00 for the same position. The contract was for a two-year period. When the period lapsed, private respondents were repatriated and were extended local employment. However, all of them filed their voluntary resignation effective August 31, 1987 so that they could avail of more benefits under the Retirement Program offered by the PNCC. On August 17, 1987, private respondents filed a complaint before the POEA for, among others, (a) non-payment of promotional pay increase for Raul C. Abrico and Rodrigo J. Vasallo; (b) underpayment of salaries, overtime pay, bonuses, night differential pay, sick leave, and vacation leave benefits; (c) assigning Friday overtime guarding duties to non-guards. In disposing of the complaint, the POEA ruled as follows: The issues to be resolved in these are:

1. Whether or not herein complainants are entitled to salary and overtime pay differentials. 2. Whether or not herein complainants are entitled to vacation leave and sick leave differentials, bonus differential and night shift differential. 3. Whether or not complainants Raul Abrico and Rodrigo J. Vasallo are entitled to promotional pay differential. This Office, after a thorough examination of the allegations as well as the evidence of the parties finds the answer of the first issue to be affirmative, affirmative also to the second issue as far as vacation and sick leaves (sic) differentials as well as bonus differential are concerned and negative as to the rest of the issues. . . . The only dispute which remains unsolved is whether or not the monthly salary of herein complainants is US$350.00 a month or US$260.00. As correctly invoked by complainants paragraph (1) of Article 34 of the Labor Code prohibits the substitution or alteration of employment contracts approved and verified by the Department of Labor from the time (of) the actual signing thereof by the parties up to and including the period of expiration of the same without the approval of the Department of Labor. With regard to the first issue in this case the approved contract of employment of the herein complainants with the respondent is US$350.00 a month. This can be inferred from the POEA approved contract of employment and by the certification issued by respondent's chief recruiting officer. This being so, herein complainants have the right to be paid as monthly salaries the aforementioned amount. Complainants having been granted voluntarily by the respondent a two-hour daily overtime (Exh. "G", "G-1") during the durations of their contract, are also entitled to be paid thereto based on the monthly salaries of US$350.00 and not US$260.00. In connection with the second issues of vacation and sick leaves (sic) differentials as well as bonus differential, there being no refutation from the respondent of the allegation of the complainants that they were paid the said benefits in accordance with the monthly rate they were receiving while working in Iraq, that is US$260.00, instead of US$350.00, their salary rate in their approved employment contract, this Office finds it proper to award the complainants the difference of the two (2) aforementioned amounts as far as their vacation and sick leaves (sic) benefits as well as completion bonus are concerned. Subparagraph a of paragraph seven of the master employment contract of the respondent in its Iraq project during the year 1985 provides a vacation leave of 20 days and sick leave of 10 days or a total of thirty (30) days leave for each of their employees for twelve (12) months service. The said leaves (sic) benefits are commutable to cash at the rate of 100% of the employee's salary at the end of employees foreign assignment (subpar. c par. 7, respondent's Master Employment Contract). Respondent's master employment contract also provides for completion bonus of fifteen (15) days for every year of service (par. 15). Respondents having paid the complainants the said benefits in accordance with the monthly rate they actually received while working in Iraq, this Office finds it proper for the respondent to pay to complainants the difference of the two aforementioned amounts. 1 From the decision of the POEA, the PNCC appealed to the NLRC. It alleged that the POEA erred in applying Article 34(i) of the Labor Code; and in holding that the notice of employment, dated April 15, 1985, providing for a monthly salary of US$350.00 was the actual overseas employment contract instead of the one dated May 12, 1985 which provided for a salary of US$260.00/month.

In affirming the POEA decision, the NLRC stated: . . . suffice it to state that in its aforestated Rejoinder respondent-appellant corporation admitted as ". . . beyond question . . . that the contracts dated April 15, 1985 were amended or modified on May 12, 1985" (Rollo 60) the latter sans ". . . the approval of the Department of Labor . . ." and/or the POEA, thus within the context of prohibited practices under Art. 34 (i) of the Labor Code, as amended. As validated by the POEA, the approved employment contracts of complainantsappellees were for US$350.00 a month salary. Ms. Solis certified to the aforesaid salary as PNCC Recruitment Head (Rollo 25-28); also, as per POEA Accreditation Department certification dated 25 June 1987. (Rollo24). xxx xxx xxx Relative to the last assignment of error, respondent-appellant corporation insists that the POEA('s) basis for the computation of the awarded differentials are erroneous for being without evidentiary basis or contrary to the evidence. It must be noted that complainants-appellees presented its (sic) claims (Annex "M", "N", "O", "P"; Rollo122-136, 73-98) for differentials in overtime pay, sick leave and vacation leave benefits and completion bonus, as well as its (sic) Exhibits "G" and "G1", all of which served as POEA bases for entitlement (Rollo 181, 182) to the several money claims; and the formula bases for the aforestated computation were detailed besides, in the assailed decision (pages 6, 7; Rollo 179, 180). The record is bereft however, of evidence of compliance with the aforesaid employment contracts relative to the aforesaid claims. Absolutely no evidence appears to have been submitted for respondent-appellants relative to satisfaction of the aforementioned claims: whether of payments for any overtime as authorized and rendered, or availment of leave benefits or its computation (sic) to cash, etc., where the pertinent employment records, particularly disbursements for services rendered, as well as for fringe benefits usually are for the account of the deploying employer. 2 A Motion for Reconsideration of this Resolution having been denied on August 23, 1991, petitioner filed this petition for certiorari alleging that the public respondents committed grave abuse of discretion amounting to lack or excess of jurisdiction in holding that the notice of employment dated April 15, 1985 was the actual employment contract and that Article 34 (i) of the Labor Code was applicable. We find no sufficient ground to annul the decision of the NLRC due to a capricious and whimsical exercise of judgment. The petitioner's claim that the public respondent NLRC gravely abused its discretion in holding that the private respondents were entitled to a monthly salary of US$350.00 pursuant to the April 15, 1985 employment contract has not been adequately substantiated. One of the axioms governing judicial review through certiorari is that the administrative decision may properly be annulled or set aside only upon clear showing that the administrative official or tribunal has acted with grave abuse of discretion. 3 The assailed NLRC decision which affirmed the POEA ruling was based on the exhibits presented by the parties, among which were the confirmation letters 4 issued to each of the private respondents and the certification 5issued by the POEA on June 25, 1987 stating that the approved rate for the position of a company guard for the PNCC was US$350.00. More importantly, the NLRC relied upon the admission made by the PNCC. Thus, it held:

. . . suffice it to state that in its aforestated Rejoinder respondent-appellant corporation admitted [Emphasis supplied] as ". . . beyond question . . . that the contracts dated April 12, 1985 were amended or modified on May 12, 1985" (Rollo 60), the latter sans ". . . the approval of the Department of Labor . . ." and/or the POEA, thus within the context of prohibited practices under Art. 34 (i) of the Labor Code, as amended. 6 The PNCC now finds fault in that decision by saying that the April 15, 1985 document was but a mere notice/offer of employment. Petitioner alleges further that it was never signed and accepted by private respondents. Consequently, it never became a binding contract between the parties concerned. Petitioner further stated that the real contract of employment was the one executed on May 12, 1985 which provided for a monthly salary of US$260.00 and which was accepted by private respondents. While the allegations of the PNCC may cast doubt on the real nature of the April 12, 1985 document, our Civil Code 7 states: In case of doubt, all labor legislation and all labor contracts shall be construed in favor of the safety and decent living for the laborers. The mandate of the law for a liberal interpretation of labor contracts in favor of the working man was applied in the case of Ditan vs. POEA Administrator 8 where We made the following pronouncement: A strict interpretation of the cold facts before us might support the position taken by the respondents. However, we are dealing here not with an ordinary transaction but with a labor contract which deserves special treatment and a liberal interpretation in favor of the worker . . . the Constitution mandates the protection of labor and the sympathetic concern of the State for the working class conformably to the social justice policy. . . . xxx xxx xxx Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privileges in life should have more privileges in law. . . . . WHEREFORE, in view of the foregoing, the questioned Resolution of the NLRC is hereby AFFIRMED. Consequently, this petition is DISMISSED. With costs.

Ditan vs. POEA Administrator [G.R. No. 79560 December 3, 1990] Post under case digests, labor law at Wednesday, March 28, 2012 Posted by Schizophrenic Mind Facts: Andres E. Ditan was recruited by private respondent Intraco Sales Corporation, through its local agent, Asia World, the other private respondent, to work in Angola as a welding supervisor. The

contract was for nine months, at a monthly salary of US$1,100.00 or US$275.00 weekly, and contained the required standard stipulations for the protection of our overseas workers. Arriving on November 30, 1984, in Luanda, capital of Angola, the petitioner was assigned as an ordinary welder in the INTRACO central maintenance shop from December 2 to 25, 1984. On December 26, 1984, he was informed, to his distress that would be transferred to Kafunfo, some 350kilometers east of Luanda. This was the place where, earlier that year, the rebels had attacked and kidnapped expatriate workers, killing two Filipinos in the raid. Naturally, Ditan was reluctant to go. However, he was assured by the INTRACO manager that Kafunfo was safe and adequately protected by government troops; moreover, he was told he would be sent home if he refused the new assignment. In the end, with much misgiving, he relented and agreed. On December 29, 1984, his fears were confirmed. The Unita rebels attacked the diamond mining site where Ditan was working and took him and sixteen other Filipino hostages, along with otherforeign workers. The rebels and their captives walked through jungleterrain for 31 days to the Unita stronghold near the Namibian border. They trekked for almost a thousand kilometers. They subsisted on meager fare. Some of them had diarrhea. Their feet were blistered. It was only on March 16, 1985, that the hostages were finally released after the intercession of their governments and the International Red Cross. Six days later, Ditan and the other Filipino hostages were back in the Philippines. The repatriated workers had been assured by INTRACO that they would be given priority in re-employment abroad, and eventually eleven of them were taken back. Ditan having been excluded, he filed in June 1985 a complaint against the private respondents for breach of contract and various other claims. Specifically, he sought the amount of US$4,675.00, representing hissalaries for the unexpired 17 weeks of his contract; US$25,000.00 as war risk bonus; US$2,196.50 as the value of his lost belongings; US$1,100 for unpaid vacation leave; and moral and exemplary damages in the sum of US$50,000.00, plus attorney's fees.

All these claims were dismissed by POEA Administrator Tomas D. Achacoso in a decision dated January 27, 1987. 2 This was affirmed in toto by respondent NLRC in a resolution dated July 14, 1987, 3 which is now being challenged in this petition.

Issue: Whether or not this case is within NLRC jurisdictiona and if Ditan is entitled to any relief?

Held: Yes. The fact that stands out most prominently in the record is the risk to which the petitioner was subjected when he was assigned, after his reluctant consent, to the rebel-infested region of Kafunfo. This was a dangerous area. The petitioner had gone to that foreign land in search of a better life that he could share with his loved ones after his stint abroad. That choice would have required him to come home empty-handed to the disappointment of an expectant family. It is not explained why the petitioner was not paid for the unexpired portion of his contract which had 17 more weeks to go. The hostages were immediately repatriated after their release, presumably so they could recover from their ordeal. The promise of INTRACO was that they would be given priority in re-employment should their services be needed. In the particular case of the petitioner, the promise was not fulfilled. It would seem that his work was terminated, and not again required, because it was really intended all along to assign him only to Kafunfo.

The private respondents stress that the contract Ditan entered into called for his employment in Angola, without indication of any particular place of assignment in the country. This meant he agreed to be assigned to work anywhere in that country, including Kafunfo. When INTRACO assigned Ditan to that place in the regular course of its business, it was merely exercising its rights under theemployment contract that Ditan had freely entered into. Hence, it is argued, he cannot now complain that there was a breach of that contract for which he is entitled to monetary redress. The private respondents also reject the claim for war risk bonus and point out that POEA Memorandum Circular No. 4, issued pursuant to themandatory war risk coverage provision in Section 2, Rule VI, of the POEA Rules and Regulations on Overseas Employment, categorizing Angola as a war risk took effect only on February 6, 1985"after the petitioner's deployment to Angola on November 27, 1984." Consequently, the stipulation could not be applied to the petitioner as it was not supposed to have a retroactive effect.

The paramount duty of this Court is to render justice through law. The law in this case allows two opposite interpretations, one strictly in favor of the employers and the other liberally in favor of the worker. The choice is obvious. We find, considering the totality of the circumstances attending this case, that the petitioner is entitled to relief. The petitioner went to Angola prepared to work as he had promised in accordance with the employment contract he had entered into in good faith with the private respondents. Over his objection, he was sent to a dangerous assignment and as he feared was

taken hostage in a rebel attack that prevented him from fulfilling his contract while in captivity. Upon his release, he was immediately sent home and was not paid the salary corresponding to the unexpired portion of his contract. He was immediately repatriated with the promise that he would be given priority in re-employment, which never came. To rub salt on the wound, many of his cohostages were re-employed as promised. The petitioner was left only with a bleak experience and nothing to show for it except dashed hopes and a sense of rejection.

Under the policy of social justice, the law bends over backward to accommodate the interests of the working class on the humane justification that those with less privileges in life should have more privileges in law. Insular Bank of Asia and America Employees Union (IBAAEU) v. Inciong Case No. 62G.R. No. L-52415 (October 23, 1984) FACTS: Petitioner first filed a complaint to the lower Court against Insular Bank of Asia and America (IBAA) for not paying the holiday pay. The Petition was granted and IBAA paid for the holiday wage. Later, IBAA stopped paying the holiday wage incompliance to the issuance of Sec. 2 of the Rules and Regulations implementing the Labor Code and the Policy Instruction No. 9 issued by Respondent (then Secretary of DOLE). Petitioner filed for a motion for a writ of execution to enforce the arbiters decision of paying the holiday wages and the motion was granted. IBAA then appealed to NLRC and NLRC dismissed the appeal. At this point, IBAA filed a motion for reconsideration to Respondent. Respondent granted IBAA s motion for reconsideration. Petitioner then filed a petition for certiorari charging Respondent of grave abuse of discretion amounting to lack of jurisdiction. ISSUE:1. W/N the decision of the Labor Arbiter can be set aside by Respondent considering that it has become final and had been partially executed.2. W/N Sec. 2 of Implementing Rules and Policy Instruction No. 9 are valid .HELD:A judgment in a labor case that has become executory cannot be revoked after finality of judgment. In the case at bar, IBAA waived its right to appeal by paying the holiday wage and is therefore deemed to have accepted the judgment as correct. Sec. 2 and Policy Instruction No. 9 are both null and void since they amended the provisions of the Labor Code. It has been held that where the language of the law is clear and unequivocal the law must be taken to mean exactly what it says. And also, if a contemporaneous construction is so erroneous, the same must be declared null and void.

[G.R.

No.

62207, PETITIONER-APPELLANT, OF COMPENSATION

December VS. GOVERNMENT

15, SERVICE

1986] INSURANCE CULTURE]

JUAN BONIFACIO, SYSTEM [MINISTRY AND EMPLOYEES'

EDUCATION COMMISSION,

RESPONDENTS-APPELLEES.

DECISION FERNAN, J.: Petition for review on certiorari of the decision of the Employees Compensation Commission dated August 19, 1982, affirming the denial by the Government Service Insurance System of petitioner's claim for benefits under PD No. 626, as amended, for the death of his spouse, Lourdes Bonifacio. The facts are undisputed. The late Lourdes Bonifacio was a class room teacher assigned to the district of Bagamanoc, Division of Catanduanes, Ministry of Edu cation and Culture from August, 1965 until she contracted carcinoma of the breast with metastases to the gastro-intestinal tract and lungs which caused her death on October 5, 1978. Dra. Corazon Yabes-Almirante of the Ospital ng Bagong Lipunan certified that the late Lourdes Bonifacio underwent radical mastectomy for cancer of the breast in 1973. In 1976, when her ailment was noted to have metastasized to her abdomen, she submitted herself to an operation known as "exploratory laparotomy" in March of the same year. On September 1, 1978, she complained of "abdominal pain, abdominal enlargement, vomiting, and failure to pass stools inspite of laxatives." Upon operation, it was found that her entire gastro-intestinal tract was enveloped by carcinoma. Despite chemotherapy, she died on October 5, 1978 from carcinoma of the breast metastatic to gastro-intestinal tract and lungs. Thereafter a claim for death benefits under P.D. No. 626, as amended, was filed by petitioner with the GSIS. The same was however denied on the ground that the decedent's principal ailment, carcinoma of the breast with metastases to gastro-intestinal tract and lungs, is not an occupational disease for her particular work as a teacher, nor is the risk of contracting said disease increased by her working conditions. The Employees Compensation Commission, on appeal, affirmed the decision of the respondent System. Petitioner now assails the decision of the respondent Commission on the following grounds: a] The respondent Commission's affirmance of the denial by respondent System totally ignored the Supreme Court's pronouncements on compensation cases; and Under the law, in case of doubt in the implementation and interpretation of the provisions of the Labor Code, including its implementing rules and regulations, the same shall be resolved in favor of the laborer.

b]

We hold that the GSIS and the Employees Compensation Commission did not err in denying petitioner's claim.

A compensable sickness means "any illness definitely accepted as an occupational disease listed by the Employees Compensation Commission, or any illness caused by employment subject to proof by the employee that the risk of contracting the same is increased by working conditions. For this purpose, the Commission is empowered to de termine and approve occupational diseases and work related illnesses that may be considered compensable based on peculiar hazards of employment." [Art. 167(1) Labor Code as amended by P.D. No. 1368, effective May 1, 1978]. Thus, for the sickness or the resulting disability or death to be compensable, the sickness must be the result of an accepted occupational disease listed by the Employees Compensation Commission [Annex "A" of the Amended Rules on Employees Compensation], or any other sickness caused by employment subject to proof by claimant that the risk of contracting the same is increased by working conditions. [Sec., 1, Rule II, Amended Rules on Employees Compensation]. Carcinoma of the breast with metastases to the gastro-intestinal tract and lungs is not listed by the Commission as an occupational disease. As to the "metastases to the gastro-intestinal tract and lungs" the Commission lists such disease as occupational only in the following employment: "Occupational Disease" 16. Cancer of stomach and other lymphatic and blood forming vessels; nasal cavity and sinuses Nature of Employment Woodworkers, wood products industry carpenters, loggers and employees in pulp and paper mills and plywood mills. Vinyl chloride workers, plastic workers.

17.

Cancer of the lungs, liver and brain.

[Annex A, Amended Rules on Employees Compensation, see p. 38, Rollo.] The cancer which affected the deceased not being occupational in her particular employment, it became incumbent upon petitioner to prove that the decedent's working conditions increased the risk of her contracting the fatal illness. This onus, petitioner failed to satisfactorily discharge. We note the following medical report on breast cancer which the Employees Compensation Commission cited in its decision and which the petitioners failed to controvert: "x x x Recent observations on the epidemeology of breast cancers suggest that it is intimately linked to 'estrogenic hormones' [W.A.P. Anderson, Mosby, Pathology 5th edition, pp. 1217-1218]. Mammary carcinoma is likely to metastasize relatively early to the regional lymph node's axillary and supra clavicular, if the primary site is in the outer half the breast. From thence it spreads primarily to the bones, lungs, skin and subcutaneous tissues generally; less frequently to the brain. [Winrobe, et. al., Harrison's Principles of Internal Medicine, 7th edition pp. 584-585]." (pp. 3-4, ECC decision dated August 19, 1982). Petitioner's contention that the decision of the Employees Compensation Commission totally ignored the Supreme Court's pronouncements on compensation cases is unmeritorious. The petitioner evidently overlooked that his claim is now within the ambit of the Labor Code and the rulings under the old law, Act No. 3428, as amended, no longer control. The old law as embodied particularly in Section 43 of RA No. 772 amending Act No. 3812, provided for "the presumption of compensability and the rule on aggravation of illness, which favor the employee", and "paved the way for the latitudinarian or expansive application of the Workmen's Compensation Law in favor of the employee or worker." [Sulit v. ECC, 98 SCRA 483,489] The presumption in essence states that in any proceeding for the enforcement of the claim for compensation under the Workmen's Compensation Act "it shall be presumed in the absence of substantial evidence to the contrary that the

claim comes within the provisions of the said Act, that sufficient notice thereof was given, that the injury was not occasioned by the willful intention of the injured employee to bring about the injury or death of himself or of another, that the injury did not result solely from the intoxication of the injured employee while on duty, and that the contents of verified medical and surgical reports introduced in evidence by claimants for compensation are correct." Thus, under the Workmen's Compensation Law, it is not necessary for the claimant to carry the burden of proof to establish his case to the point of demonstration [Abana vs. Quisumbing, 22 SCRA 1278]. It is "not necessary to prove that employment was the sole cause of the death or injury suffered by the employee. It is sufficient to show that the employment had contributed to the aggravation or acceleration of such death or ailment." [Fontesa vs. ECC, 22 SCRA 282] "Once the disease had been shown to have arisen in the course of employment, it is presumed by law, in the absence of substantial evidence to the con trary, that it arose out of it." [Hernandez vs. ECC, et. al. L20202, May 31, 1965]. With this legal presumption in the old law, the burden of proof shifts to the employer and the employee no longer suffers the burden of showing causation. Under the present Labor Code, the "latitudinarian or expansive application of the Workmen's Compensation Law in favor of the employee or worker" no longer prevails as the burden of showing proof of causation has shifted back to the employee particularly in cases of sickness or injuries which are not accepted or listed as occupational by the Employees Compensation Commission. As stated in Sulit vs. Employees Compensation Commission, [supra] "the Labor Code abolished the presumption of compensability and the rule on aggravation of illness caused by the nature of the employment." While we do not dispute petitioner's contention that under the law, in case of doubt in the implementation and interpretation of the provisions of the Labor Code, including its implementing rules and regulations, the doubt shall be resolved in favor of the laborer, we find that the same has no application in this case since the pertinent provisions of the Labor Code leave no room for doubt either in their interpretation or application. WHEREFORE, the petition is dismissed and the decisions of the GSIS and the Employees Compen sation Commission denying the claim, are affirmed. No costs.

Rubberworld (Phils.) vs. NLRC [336 SCRA 433 (July 26, 2000)] Jurisdiction of the SEC Facts: Petitioner Rubberworld, a corporation established in 1965, is engaged in the manufacture of footwear, bags and garment. Private respondents are employees of the said corporation. On August 26, 1994, Rubberworld filed with the Department of Labor and employment a notice of temporary shutdown of operations to take effect on September 26, 1994. Before the effectivity date, however, Rubberworld was forced to prematurely shutdown its operations. On November 11, 1994, private respondents filed with the NLRC a complaint against petitioner for illegal dismissal and non-payment of separation pay. On November 22, 1994, Rubberworld filed with the SEC a petition for declaration of suspension of payments with a proposed rehabilitation plan. On December 28, 1994, SEC issued an order suspending all actions for claims against Rubberworld in accordance with P.D. 902-A. Despite this order, however, the Labor Arbiter ruled against Rubberworld, declaring its shutdown illegal and making the corporation liable for damages and payment of separation pay. The NLRC affirmed the decision of the Labor Arbiter. Hence, Rubberworld filed with the SC a petition to annul the NLRC resolution. Issue: Whether or not NLRC acted without or in excess of its jurisdiction?

Held: P.D. 902-A is clear that all actions for claims against corporations, partnerships, or associations under management or receivership pending before any court, tribunal, board or body shall be suspended accordingly. NLRC thus acted without an in excess of its jurisdiction when it proceeded to decide the case despite the suspension order. As a consequence, any resolution decisions or order that is rendered without jurisdiction is a nullity.

Social Security System Employees Association v. CA Facts: On 9 June 1987, the officers and members of Social Security System EmployeesAssociation (SSSEA) staged a strike and barricaded the entrances to the SSS Building,p r e v e n t i n g n o n s t r i k i n g e m p l o y e e s f r o m r e p o r t i n g f o r w o r k a n d S S S m e m b e r s f r o m transacting business with the SSS. The SSSEA went on strike after the SSS failed to act onthe union's demands, which included: implementation of the provisions of the old SSS SSSEA collective bargaining agreement (CBA) on check-off of union dues; payment of accrued overtime pay, night differential pay and holiday pay; conversion of temporary orcontractual employees with 6 months or more of service into regular and permanentemployees and their entitlement to the same salaries, allowances and benefits given to other regular employees of the SSS; and payment of the children's allowance of P30.00,a n d a f t e r t h e S S S d e d u c t e d c e r t a i n a m o u n t s f r o m t h e s a l a r i e s o f t h e employees a n d allegedly committed acts of discrimination and unfair labor practices. The strike wasreported by the Social Security System (SSS) to the Public Sector Labor-ManagementCouncil, which ordered the strikers to return to work. The strikers refused to return to w o r k . O n 1 1 J u n e 1 9 8 7 , t h e S S S f i l e d w i t h t h e R e g i o n a l T r i a l C o u r t o f Q u e z o n C i t y a complaint for damages with a prayer for a writ of preliminary injunction against the SSSEA,Dionisio T. Baylon, Ramon Modesto, Juanito Madura, Reuben Zamora, Virgilio De Alday,Sergio Araneta, Placido Agustin, and Virgilio Magpayo, praying that a writ of preliminaryinjunction be issued to enjoin the strike and that the strikers be ordered to return to work;that SSSEA, et. al. be ordered to pay damages; and that the strike be declared illegal. On11 June 1987, the RTC issued a temporary restraining order pending resolution of the application for a writ of preliminary injunction. In the meantime, the SSSEA, et. al. filed amotion to dismiss alleging the trial court's lack of jurisdiction over the subject matter. On22 July 1987, the court a quo denied the motion to dismiss and converted the restrainingorder into an injunction upon posting of a bond, after finding that the strike was illegal. Asthe SSSEA's motion for the reconsideration of the order was also denied on 14 August 1988, SSSEA ,et. al. filed a petition for certiorari and prohibition with preliminary injunctionbefore the Supreme Court (GR 79577). In a resolution dated 21 October 1987, the Court,through the Third Division, resolved to refer the case to the Court of Appeals. SSSEA, et.al. filed a motion for reconsideration thereof, but during its pendency the Court of Appealson 9 March 1988 promulgated its decision on the referred case. SSSEA, et. al. moved to recall the Court of Appeals' decision. In the meantime, the Court on 29 June 1988 deniedthe motion for reconsideration in GR 97577 for being moot and academic. SSSEA, et. al.'sm o t i o n t o r e c a l l t h e decision of the Court of Appeals was also denied in view of theSupreme Court's denial of the motion for reconsideration. SSSEA filed the p e t i t i o n t o review the decision of the Court of Appeals. Issue: Whether SSS employees, in furtherance of labor interests, may conduct a strike.Held: The 1987 Constitution, in the Article on Social Justice and Human Rights (Art. XIII,S e c . 3 ) , p r o v i d e s t h a t t h e S t a t e " s h a l l g u a r a n t e e t h e r i g h t s o f a l l workers to selforganization, collective bargaining and negotiations, and peaceful concerted activities,in cluding the right to strike in accordance with law." By itself, this provision would seem torecognize the right of all workers and employees, including those in the public sector, tostrike. But the Constitution itself fails to expressly confirm this impression, for in the SubArticle on the Civil Service Commission, it provides, after defining the scope of the civilservice as "all branches, subdivisions, instrumentalities, and agencies of the Government,including government-owned or controlled corporations with original charters," that "the right to self-organization shall not be denied to government employees." Parenthetically,the Bill of Rights also provides that "the right of the people, including those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to law shall not abridged" [Art. III, Sec. 8]. Thus, while there is no question thatthe Constitution recognizes the right of government employees to organize, it is silent asto whether such recognition also includes the

right to strike. Resort to the intent of thef r a m e r s o f t h e o r g a n i c l a w b e c o m e s h e l p f u l i n u n d e r s t a n d i n g t h e m e a n i n g o f t h e s e provisions. A reading of the proceedings of the Constitutional Commission that drafted the1987 Constitution would show that in recognizing the right of government employees toorganize, the commissioners intended to limit the right to the formation of unions orassociations only, without including the right to strike. Statutorily, it will be recalled thatthe Industrial Peace Act (CA 875), which was repealed by the Labor Code (PD 442) in 1974,expressly banned strikes by employees in the Government, including instrumentalitiesexercising governmental functions, but excluding entities entrusted wit h proprietaryf u n c t i o n s . U n d e r s t a n d a b l y , t h e L a b o r C o d e i s s i l e n t a s t o w h e t h e r o r n o t g o v e r n m e n t employees may strike, for such are excluded from its coverage. But then the Civil ServiceDecree (PD 807), is equally silent on the matter. Thus, on 1 June 1987, to implement theconstitutional guarantee of the right of government employees to organize, the Presidenti s s u e d EO 180 which provides guidelines for the exercise of the right t o o r g a n i z e o f government employees. In Section 14 thereof, it is provided that "the Civil Service law andr u l e s g o v e r n i n g c o n c e r t e d a c t i v i t i e s a n d s t r i k e s i n t h e g o v e r n m e n t s e r v i c e s h a l l b e observed, subject to any legislation that may be enacted by Congress." The President wasapparently referring to Memorandum Circular No. 6, series of 1987 of the Civil ServiceC o m m i s s i o n u n d e r d a t e 1 2 A p r i l 1 9 8 7 w h i c h , " p r i o r t o t h e e n a c t m e n t by Congress of applicable laws concerning strike by government employees enjoins under p a i n o f administrative sanctions, all government officers and employees from staging s trikes,demonstrations, mass leaves, walk-outs and other forms of mass action which will result int e m p o r a r y s t o p p a g e o r d i s r u p t i o n o f p u b l i c s e r v i c e . " T h e a i r w a s t h u s c l e a r e d o f t h e confusion. At present, in the absence of any legislation allowing government employees tostrike, recognizing t heir right to do so, or regulating the exercise of the right, they areprohibited from striking, by express provision of Memorandum Circular 6 and as implied inEO 180. The Court is of the considered view that the SSS employees are covered by theprohibition against strikes. Considering that under the 1987 Constitution "the civil serviceembraces all branches, subdivisions, instrumentalities, and agencies of the Government,including government-owned or controlled corporations with original charters" and thatthe SSS is one such government -controlled corporation with an original charter, having been created under RA 1161, its employees are part of the civil service and are coveredby the Civil Service Commission's memorandum prohibiting strikes. This being the case,the strike staged by the employees of the SSS was illegal. In fine, government employeesmay through their unions or associations, either petition the Congress for the bettermentof the terms and conditions of employment which are within the ambit of legisla tion ornegotiate with the appropriate government agencies for the improvement of those whichare not fixed by law. If there be any unresolved grievances, the dispute may be referred tothe Public Sector Labor-Management Council for appropriate action. But employees in thecivil service may not resort to strikes, walkouts and other temporary work stoppages, likeworkers in the private sector, to pressure the Government to accede to their demands. Asnow provided under Sec. 4, Rule III of the Rules and Regulations to Govern the Exercise of the Right of Government Employees to SelfO r g a n i z a t i o n , w h i c h t o o k e f f e c t a f t e r t h e present dispute arose, "the terms and conditions of employment in the government,including any political subdivision or instrumentality thereof and government-owned andcontrolled corporations with original charters are governed by law and employees thereinshall not strike for the purpose of securing changes thereof."