LORENZO T.

TANGGA-AN,* Petitioner,
vs.
PIDLIPPINE TRANSMARINE CARRIERS, INC., UNIVERSE TANKSHIP DELAWARE LLC, and
CARLOS C. SALINAS, Respondent
G.R. No. 180636
DEL CASTILLO, J.:

March 13, 2013

Facts:
This is a case for illegal dismissal with a claim for the payment of salaries corresponding to the
unexpired term of the contract, damages and attorneys fees filed by private respondent Lorenzo T.
Tangga-an against the petitioners Philippine Transmarine Carriers, Inc., Universe Tankship Delaware
LLC, and Carlos C. Salinas4 or herein respondents.
Tangga-an alleged that on January 31, 2002, he entered into an overseas employment contract with
Philippine Transmarine Carriers, Inc. (PTC) for and in behalf of its foreign employer, Universe
Tankship Delaware, LLC. Under the employment contract, he was to be employed for a period of six
months as chief engineer of the vessel the S.S. "Kure". He was to be paid a basic salary of
US$5,000.00; vacation leave pay equivalent to 15 days a months [sic] or US$2,500.00 per month and
tonnage bonus in the amount of US$700.00 a month.
The master required Tangga-an to submit a written explanation to which he did but blamed the captain
and the chief officer. He failed to explain why he did not personally supervise the operation of the
generator system and the conveyor boom during the cargo discharging operations. His explanation
not having been found satisfactory, respondents decided to terminate Tangga-ans services. Thus, a
notice of dismissal was issued against Tangga-an. He arrived in the Philippines on April 4, 2002. 5
Tangga-an filed a Complaint6 for illegal dismissal with prayer for payment of salaries for the unexpired
portion of his contract, leave pay, exemplary and moral damages, attorneys fees and interest.
Issue:
Is Tangga-an entitled to back salaries equivalent to four months which corresponds to the unexpired
portion of the contract, inclusive of vacation leave pay and tonnage bonus, plus 10% thereof as
attorneys fees?
Law Applicable
Article 111 of the Labor Code, as amended, governs the grant of attorneys fees in labor cases:
Art. 111. Attorneys fees. (a) In cases of unlawful withholding of wages, the culpable party may be
assessed attorneys fees equivalent to ten percent of the amount of wages recovered.
(b) It shall be unlawful for any person to demand or accept, in any judicial or administrative
proceedings for the recovery of wages, attorneys fees which exceed ten percent of the amount of
wages recovered.
Section 8, Rule VIII, Book III of its Implementing Rules also provides, viz.:
Section 8. Attorneys fees. Attorneys fees in any judicial or administrative proceedings for the
recovery of wages shall not exceed 10% of the amount awarded. The fees may be deducted from the
total amount due the winning party.

Section 10 of Republic Act No. 8042 In case of termination of overseas employment without just, valid
or authorized cause as defined by law or contract, the workers shall be entitled to the full
reimbursement of his placement fee with interest of twelve percent (12%) per annum, plus his salaries
for the unexpired portion of his employment contract or for three (3) months for every year of the
unexpired term, whichever is less.
Case History
Labor Arbiters Decision - judgment is hereby rendered finding Tangga-an illegally dismissed from his
employment and directing the respondent Phil. Transmarine Carriers, Inc. to pay Tangga-an the
amount of US$24,600.00 PLUS US$2,460.00 attorneys fees or a total aggregate amount of US
Dollars: TWENTY SEVEN THOUSAND SIXTY (US$27,060.00) or its peso equivalent at the exchange
rate prevailing at the time of payment.
National Labor Relations Commission - claimed that the Labor Arbiter committed grave abuse of
discretion in finding that petitioner was illegally dismissed; in awarding unearned vacation leave pay
and tonnage bonus when the law and jurisprudence limit recovery to the employees basic salary; and
in awarding attorneys fees despite the absence of proof of bad faith on their part.
On November 30, 2006, the CA rendered - PARTIALLY GRANTED. The Decision of public
respondent is MODIFIED in the following manner:
a. Tangga-an is entitled to three (3) months salary representing the unexpired portion of his
contract in the total amount of US$15,000.00 or its peso equivalent at the exchange rate
prevailing at the time of payment;
b. Tangga-ans placement fee should be reimbursed with 12% interest per annum;
c. The award of attorneys fees is deleted.
Ruling
SC held the Petition is GRANTED. Petitioner Lorenzo T. Tangga-an is hereby declared ENTITLED to
back salaries for the unexpired portion of his contract, inclusive of vacation leave pay and tonnage
bonus which is equivalent to US$32,800 plus US$3,280 as attorney's fees or a total of US$36,080 or
its peso equivalent at the exchange rate prevailing at the time of payment.
Opinion
Petitioner's employment was illegally terminated. As a result, his wages as well as allowances were
withheld without valid and legal basis. Otherwise stated, he was not paid his lawful wages without any
valid justification. Consequently, he was impelled to litigate to protect his interests. Thus, pursuant to
the above ruling, he is entitled to receive attorneys fees.

ARMANDO ALILING, Petitioner - versus - JOSE B. FELICIANO, MANUELBERSAMIN, JJ F. SAN

MATEO III, JOSEPH R. LARIOSA, and WIDE WIDE Promulgated: WORLD EXPRESS
CORPORATION, Respondents.
G.R. No. 185829 April 25, 2012
Facts:
Via a letter dated June 2, 2004,[6] respondent Wide Wide World Express Corporation (WWWEC)
offered to employ petitioner Armando Aliling (Aliling) as Account Executive (Seafreight Sales), with the
following compensation package: a monthly salary of PhP 13,000, transportation allowance of
PhP 3,000, clothing allowance of PhP 800, cost of living allowance of PhP 500, each payable on a per
month basis and a 14th month pay depending on the profitability and availability of financial resources
of the company. The offer came with a six (6)-month probation period condition with this express
caveat: Performance during [sic] probationary period shall be made as basis for confirmation to
Regular or Permanent Status.
On June 11, 2004, Aliling and WWWEC inked an Employment Contract under the following terms,
among others:
Conversion to regular status shall be determined on the basis of work performance; and
Employment services may, at any time, be terminated for just cause or in accordance with the
standards defined at the time of engagement.
In a separate letter dated September 27, 2004, [13] Aliling wrote San Mateo stating: Pursuant to your
instruction on September 20, 2004, I hereby tender my resignation effective October 15, 2004. While
WWWEC took no action on his tender, Aliling nonetheless demanded reinstatement and a written
apology, claiming in a subsequent letter dated October 1, 2004 [14] to management that San Mateo had
forced him to resign.
Lariosas response-letter of October 1, 2004,[15] informed Aliling that his case was still in the process
of being evaluated. On October 6, 2004,[16] Lariosa again wrote, this time to advise Aliling of the
termination of his services effective as of that date owing to his non-satisfactory performance during
his probationary period. Records show that Aliling, for the period indicated, was paid his outstanding
salary which consisted of:
PhP 4,988.18 (salary for the September 25, 2004 payroll)
1,987.28 (salary for 4 days in October 2004)
------------PhP 6,975.46 Total
Issue:
Is an order of reinstatement (despite its finding that petitioner was illegally dismissed from
employment), award back wages (even if it did not order reinstatement) and to award moral
and exemplary damages (despite its finding that petitioner was dismissed to prevent the
acquisition of his regular status), is contrary to law and applicable jurisprudence.
Law Applicable
Article 281 of the Labor Code
ART. 281. Probationary employment. - Probationary employment shall not
exceed six (6) months from the date the employee started working, unless it is
covered by an apprenticeship agreement stipulating a longer period. The services of
an employee who has been engaged on a probationary basis may be terminated for a
just cause or when he fails to qualify as a regular employee in accordance with
reasonable standards made known by the employer to the employee at the time

of his engagement. An employee who is allowed to work after a probationary period

shall be considered a regular employee. (Emphasis supplied.)
Section 6(d) of the Implementing Rules of Book VI, Rule VIII-A of the Labor
Code
Sec. 6. Probationary employment. There is probationary employment where
the employee, upon his engagement, is made to undergo a trial period where the
employee determines his fitness to qualify for regular employment, based on
reasonable standards made known to him at the time of engagement.
Probationary employment shall be governed by the following rules:
xxxx
(d) In all cases of probationary employment, the employer shall make
known to the employee the standards under which he will qualify as a regular
employee at the time of his engagement. Where no standards are made known
to the employee at that time, he shall be deemed a regular employee.
Article 282 of the Labor Code considers any of the following acts or omission on the part of the
employee as just cause or ground for terminating employment:
(a) Serious misconduct or willful disobedience by the employee of the lawful
orders of his employer or representative in connection with his work;
(b) Gross and habitual neglect by the employee of his duties;
(c) Fraud or willful breach by the employee of the trust reposed in him by his
employer or duly authorized representative;
(d) Commission of a crime or offense by the employee against the person of
his employer or any immediate member of his family or his duly authorized
representatives; and
(e) Other causes analogous to the foregoing.
Section 2 (III), Rule XXIII, Book V of the Omnibus Rules Implementing the Labor Code, which
provides:
Section 2. Standard of due process: requirements of notice. In all cases of
termination of employment, the following standards of due process shall be
substantially observed.
I. For termination of employment based on just causes as defined in Article
282 of the Code:
(a) A written notice served on the employee specifying the ground or
grounds for termination, and giving to said employee reasonable opportunity
within which to explain his side;
(b) A hearing or conference during which the employee concerned,
with the assistance of counsel if the employee so desires, is given
opportunity to respond to the charge, present his evidence or rebut the
evidence presented against him; and
(c) A written notice [of] termination served on the employee indicating
that upon due consideration of all the circumstance, grounds have been
established to justify his termination.

In case of termination, the foregoing notices shall be served on the

employees last known address.
Article 279 of the Labor Code, as amended by Section 34 of Republic Act
6715 instructs:
Art. 279. Security of Tenure. - In cases of regular employment, the
employer shall not terminate the services of an employee except for a just
cause or when authorized by this Title. An employee who is unjustly
dismissed from work shall be entitled to reinstatement without loss of
seniority rights and other privileges and to his full backwages, inclusive
of allowances, and to his other benefits or their monetary equivalent
computed from the time his compensation was withheld from him up to
the time of his actual reinstatement.
Moral damages are awarded if the following elements exist in the case: (1) an injury clearly sustained
by the claimant; (2) a culpable act or omission factually established; (3) a wrongful act or omission by
the defendant as the proximate cause of the injury sustained by the claimant; and (4) the award of
damages predicated on any of the cases stated Article 2219 of the Civil Code. In addition, the person
claiming moral damages must prove the existence of bad faith by clear and convincing evidence for
the law always presumes good faith. It is not enough that one merely suffered sleepless nights,
mental anguish, and serious anxiety as the result of the actuations of the other party. Invariably such
action must be shown to have been willfully done in bad faith or with ill motive. Bad faith, under the
law, does not simply connote bad judgment or negligence. It imports a dishonest purpose or
some moral obliquity and conscious doing of a wrong, a breach of a known duty through
some motive or interest or ill will that partakes of the nature of fraud.
Case History
Labor Arbiter issued on April 25, 2006[23] a Decision declaring Alilings termination as unjustified.
Respondents should be ordered to pay salaries corresponding to the unexpired portion of the
contract of employment and all other benefits amounting to a total of THIRTY FIVE THOUSAND
EIGHT HUNDRED ELEVEN PESOS (P35,811.00) covering the period from October 6 to December 7,
2004.
NLRC, which affirmed the Decision in toto in its Resolution dated May 31, 2007
The CA assailed Resolutions of respondent (Third Division) National Labor Relations Commission are
AFFIRMED, with the following MODIFICATION/CLARIFICATION: Respondents Wide Wide World
Express Corp. and its officers, Jose B. Feliciano, Manuel F. San Mateo III and Joseph R. Lariosa,
are jointly and severally liable to pay petitioner Armando Aliling: (A) the sum of Forty Two Thousand
Three Hundred Thirty Three & 50/100 (P42,333.50) as the total money judgment, (B) the sum of Four
Thousand Two Hundred Thirty Three & 35/100 (P4,233.35) as attorneys fees, and (C) the additional
sum equivalent to one-half (1/2) month of petitioners salary as separation pay.
Ruling
The petition is PARTIALLY GRANTED. The assailed Resolutions of respondent (Third Division)
National Labor Relations Commission are AFFIRMED, with the following
MODIFICATION/CLARIFICATION:Respondent Wide Wide World Express Corp. is liable to pay
Armando Aliling the following: (a) backwages reckoned from October 6, 2004 up to the finality of this
Decision based on a salary of PhP 17,300 a month, with interest at 6% per annum on the principal
amount from October 6, 2004 until fully paid; (b) the additional sum equivalent to one (1) month salary
for every year of service, with a fraction of at least six (6) months considered as one whole year based
on the period from June 11, 2004 (date of employment contract) until the finality of this Decision, as

separation pay; (c) PhP 30,000 as nominal damages; and (d) Attorney's Fees equivalent to 10% of the
total award.
Opinion
In order for the quota imposed to be considered a valid productivity standard and thereby validate a
dismissal, managements prerogative of fixing the quota must be exercised in good faith for the
advancement of its interest. The duty to prove good faith, however, rests with WWWEC as part of its
burden to show that the dismissal was for a just cause. WWWEC must show that such quota was
imposed in good faith. This WWWEC failed to do, perceptibly because it could not. The fact of the
matter is that the alleged imposition of the quota was a desperate attempt to lend a semblance of
validity to Alilings illegal dismissal.

KAISAHAN AT KAPATIRAN NG MGA MANGGAGAWA AT KAWANI SA MWC-EAST ZONE UNION

and EDUARDO BORELA, representing its members, Petitioners, vs. MANILA WATER
COMPANY, INC.,
Respondent.
G.R. No. 174179 November 16, 2011
Facts:
The Union is the duly-recognized bargaining agent of the rank-and-file employees of the respondent
Manila Water Company, Inc. (Company) while Borela is the Union President.
Among the benefits enjoyed by the employees of the MWSS were the amelioration allowance (AA)
and the cost-of-living allowance (COLA) granted in August 1979, pursuant to Letter of Implementation
No. 97 issued by the Office of the President.
The payment of the AA and the COLA was discontinued pursuant to Republic Act No. 6758, otherwise
known as the Salary Standardization Law, which integrated the allowances into the standardized
salary.
Thereafter, the Company integrated the AA into the monthly payroll of all its employees beginning
August 1, 2002, payment of the AA and the COLA after an appropriation was made and approved by
the MWSS Board of Trustees. The Company, however, did not subsequently include the COLA since
the Commission on Audit disapproved its payment because the Company had no funds to cover this
benefit.
As a result, the Union and Borela filed on April 15, 2003 a complaint against the Company for
payment of the AA, COLA, moral and exemplary damages, legal interest, and attorney's fees before
the National Labor Relations Commission (NLRC).
Issue:
Whether or not the NLRC gravely abused its discretion in awarding ten percent (10%) attorney's fees
to the petitioners.
Law Applicable
Art. 111. Attorney's fees.- (a) In cases of unlawful withholding of wages, the culpable party may be
assessed attorney's fees equivalent to ten percent of the amount of wages recovered.
(b) It shall be unlawful for any person to demand or accept, in any judicial or administrative
proceedings for the recovery of wages, attorney's fees which exceed ten percent of the amount of
wages recovered.
Section 8, Rule VIII, Book III of its Implementing Rules also provides, viz.:
Section 8. Attorney's fees. Attorney's fees in any judicial or administrative proceedings for the
recovery of wages shall not exceed 10% of the amount awarded. The fees may be deducted from the
total amount due the winning party.

Case History
Labor Arbiter Aliman D. Mangandog (LA) ruled in favor of the petitioners and ordered the payment of
their AA and COLA, six percent (6%) interest of the total amount awarded, and ten percent (10%)
attorney's fees.
NLRC affirmed with modification the LAs decision. It set aside the award of the COLA benefits
because the claim was not proven and established, but ordered the Company to pay the petitioners

their accrued AA of about P107,300,000.00 in lump sum and to continue paying the AA starting August
1, 2002. It also upheld the award of 10% attorney's fees to the petitioners.
Court of Appeals modified the assailed NLRC rulings by deleting [t]he order for respondent MWCI to
pay attorney's fees equivalent to 10% of the total judgment awards. The CA recognized the binding
effect of the MOA between the Company and the Union; it stressed that any further award of
attorney's fees is unfounded considering that it did not find anything in the Agreement that is contrary
to law, morals, good customs, public policy or public order.
Ruling
The resolution dated of the Court of Appeals is REVERSED and SET ASIDE. The Labor Arbiters
award of attorney's fees equivalent to ten percent (10%) of the total judgment award is
hereby REINSTATED.
Opinion
Article 111 of the Labor Code, as amended, contemplates the extraordinary concept of attorney's fees
and that Article 111 is an exception to the declared policy of strict construction in the award of
attorney's fees. Although an express finding of facts and law is still necessary to prove the merit of the
award, there need not be any showing that the employer acted maliciously or in bad faith when it
withheld the wages. In carrying out and interpreting the Labor Code's provisions and implementing
regulations, the employee's welfare should be the primary and paramount consideration. This kind of
interpretation gives meaning and substance to the liberal and compassionate spirit of the law as
embodied in Article 4 of the Labor Code "all doubts in the implementation and interpretation of the
provisions of, including its implementing rules and regulations, shall be resolved in favor of labor" and
Article 1702 of the Civil Code in case of doubt, all labor legislation and all labor contracts shall be
construed in favor of the safety and decent living for the laborer.

NANCY S. MONTINOLA, Petitioner, v. PHILIPPINE AIRLINES, Respondent.

G.R. No. 198656, September 08, 2014
LEONEN, J.
Facts:
Montinola was employed as a flight attendant of Philippine Airlines (PAL) since 1996.On January 29,
2008, Montinola and other flight crew members were subjected to custom searches in Honolulu,
Hawaii, USA. Items from the airline were recovered from the flight crew by customs officials. Nancy
Graham (Graham), US Customs and Border Protection Supervisor, sent an email to PAL regarding
the search.
During the hearing, Montinola admitted that in Honolulu, US customs personnel conducted a search
of her person. At that time, she had in her possession only the following food items:
cooked camote, 3-in-1 coffee packs, and Cadbury hot chocolate.
PAL, through Senior Assistant Vice President for Cabin Services Sub-Department Sylvia C.
Hermosisima, found Montinola guilty of 11 violations of the companys Code of Discipline and
Government Regulation. She was meted with suspension for one (1) year without pay. Montinola
asked for a reconsideration.Hermosisima, however, denied her motion for reconsideration a month
after.
Issue:
Whether or not Montinola is entitled to attorney's fees.
Law Applicable
Art. 279. Security of Tenure In cases of regular employment, the employer shall not terminate the
services of an employee except for a just cause or when authorized by this Title. An employee who is
unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and
other privileges and to full backwages, inclusive of allowances, and to his other benefits or their
monetary equivalent computed from the time his compensation was withheld from him up to the time
of his actual reinstatement.
Art. 217. Jurisdiction of Labor Arbiters and the Commission. (a) Except as otherwise provided under
this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide within
thirty (30) calendar days after the submission of the case by the parties for decision without extension,
even in the absence of stenographic notes, the following cases involving all workers, whether
agricultural or non-agricultural:ChanRoblesVirtualawlibrary
....
4. Claims for actual, moral, exemplary and other forms of damages arising from the employeremployee relations
Article 2332 of the Civil Code provides that the court may award exemplary damages if the defendant
acted in a wanton, fraudulent, reckless, oppressive or malevolent manner.
ART. 2208. In the absence of stipulation, attorneys fees and expenses of litigation, other than judicial
costs, cannot be recovered, except:ChanRoblesVirtualawlibrary
(1) When exemplary damages are awarded;
(2) When the defendants act or omission has compelled the plaintiff to litigate with third persons or to
incur expenses to protect his interest;

(3) In criminal cases of malicious prosecution against the plaintiff;

(4) In case of a clearly unfounded civil action or proceeding against the plaintiff;
(5) Where the defendant acted in gross and evident bad faith in refusing to satisfy the plaintiffs plainly
valid, just and demandable claim;
(6) In actions for legal support;
(7) In actions for the recovery of wages of household helpers, laborers and skilled workers;
(8) In actions for indemnity under workmens compensation and employers liability laws;
(9) In a separate civil action to recover civil liability arising from a crime;
(10) When at least double judicial costs are awarded;
(11) In any other case where the court deems it just and equitable that attorneys fees and expenses
of litigation should be recovered.
In all cases, the attorneys fees and expenses of litigation must be reasonable.
Case History
The Labor Arbiter found her suspension illegal, finding that PAL never presented evidence that
showed Montinola as the one responsible for any of the illegally taken airline items. The Labor Arbiter
ordered Montinolas reinstatement with backwages, inclusive of allowances and benefits amounting to
P378,630.00.
In addition, the Labor Arbiter awarded moral damages in the amount of P100,000.00 and exemplary
damages amounting to P100,000.00 also awarded attorneys fees to Montinola because she was
forced to litigate and incur expenses to protect [her] rights.cralawred
the National Labor Relations Commission affirmed the decision of the Labor Arbiter.
Court of Appeals affirmed the decisions of the Labor Arbiter and National Labor Relations Commission
in finding the suspension illegal. However, the Court of Appeals modified the award of moral and
exemplary damages and attorneys fees to private respondent are deleted.
Ruling
The decision of the Court of Appeals in MODIFIED in order to REINTEGRATE the award for moral
damages of P100,000.00, exemplary damages of P100,000.00, and attorneys fees of P57,863.00.
Opinion
The right of PAL to be constantly vigilant to prevent and deter pilferage, is equally its property which is
also protected by the Constitution. However, PAL cannot assume liability on the employee. It has to
endeavor to move through its administrative investigations more humanely and more in consonance
with the law. Its employees may only have their work. It is their work, no matter what the classification
and how significant they may be in the eyes of their employer, should give them their dignity.

CHERYLL SANTOS LEUS, Petitioner, v. ST. SCHOLASTICAS COLLEGE WESTGROVE AND/OR

SR. EDNA QUIAMBAO, OSB, Respondents.
G.R. No. 187226, January 28, 2015
REYES, J.:
Cheryll Santos Leus (petitioner) was hired by St. Scholasticas College Westgrove (SSCW), a
Catholic educational institution, as a non-teaching personnel, engaged in pre-marital sexual relations,
got pregnant out of wedlock, married the father of her child, and was dismissed by SSCW, in that
order. The question that has to be resolved is whether the petitioners conduct constitutes a ground for
her dismissal.
Issue
Is petitioner is entitled to separation pay, in lieu of actual reinstatement, full backwages and
attorneys fees, but not to moral and exemplary damages?
Law Applicable
Article 111 of the Labor Code. It is settled that where an employee was forced to litigate and, thus,
incur expenses to protect his rights and interest, the award of attorneys fees is legally and morally
justifiable.
Case History
The LA found that there was a valid ground for the petitioners dismissal; that her pregnancy out of
wedlock is considered as a disgraceful and immoral conduct. The LA pointed out that, as an
employee of a Catholic educational institution, the petitioner is expected to live up to the Catholic
values taught by SSCW to its students.
The NLRC issued a Resolution,which affirmed the LA Decision dated February 28, 2006. The NLRC
pointed out that the termination of the employment of the personnel of private schools is governed by
the 1992 MRPS; that Section 94(e) thereof cites disgraceful or immoral conduct as a just cause for
dismissal, in addition to the grounds for termination of employment provided for under Article 282 of
the Labor Code. The NLRC held that the petitioners pregnancy out of wedlock is a disgraceful or
immoral conduct within the contemplation of Section 94(e) of the 1992 MRPS and, thus, SSCW had
a valid reason to terminate her employment.
The CA further held that the petitioners dismissal was a valid exercise of SSCWs management
prerogative to discipline and impose penalties on erring employees pursuant to its policies, rules and
regulations. The CA upheld the NLRCs conclusion that the petitioners pregnancy out of wedlock is
considered as a disgraceful and immoral conduct and, thus, a ground for dismissal under Section
94(e) of the 1992 MRPS. The CA likewise opined that the petitioners pregnancy out of wedlock is
scandalous per se given the work environment and social milieu that she was in.
Ruling
The Supreme Court held, respondent, St. Scholasticas College Westgrove, is hereby declared guilty
of illegal dismissal and is hereby ORDERED to pay the petitioner, Cheryll Santos Leus, the following:
(a) separation pay in lieu of actual reinstatement equivalent to one (1) month pay for every year of
service, with a fraction of at least six (6) months considered as one (1) whole year from the time of her
dismissal up to the finality of this Decision; (b) full backwages from the time of her illegal dismissal up
to the finality of this Decision; and (c) attorneys fees equivalent to ten percent (10%) of the total
monetary award. The monetary awards herein granted shall earn legal interest at the rate of six
percent (6%) per annum from the date of the finality of this Decision until fully paid. The case
is REMANDED to the Labor Arbiter for the computation of petitioners monetary awards.
Opinion
SSCW, as employer, undeniably has the right to discipline its employees and, if need be, dismiss
them if there is a valid cause to do so. However, as already explained, there is no cause to dismiss

the petitioner. Her conduct is not considered by law as disgraceful or immoral. Further, the
respondents themselves have admitted that SSCW, at the time of the controversy, does not have any
policy or rule against an employee who engages in pre-marital sexual relations and conceives a child
as a result thereof. There being no valid basis in law or even in SSCWs policy and rules, SSCWs
dismissal of the petitioner is despotic and arbitrary and, thus, not a valid exercise of management
prerogative.

UNITED PHILIPPINE LINES, INC. AND HOLLAND AMERICA LINE, Petitioners,

vs.
GENEROSO E. SIBUG, Respondent.
G.R. No. 201072
April 2, 2014
VILLARAMA, JR., J.:
Facts:
Petitioners United Philippine Lines, Inc. and Holland America Line hired Sibug as waste handler on
board the vessel MIS Volendam. On August 5, 2005, Sibug fell from a ladder while cleaning the silo
sensor at a garbage room of the Volendam and injured his knee. He was repatriated and had anterior
cruciate ligament (ACL) reconstruction surgery at the Manila Doctors Hospital. On January 19, 2006,
he was declared fit to return to work from an orthopedic point of view.
Sibug sought reemployment, passed the pre-employment medical examination, and was re-hired by
petitioners in the same capacity for the vessel M/S Ryndam. On board Ryndam, Sibug met another
accident while driving a forklift and injured his right hand and wrist. He was repatriated. He arrived in
the Philippines on January 15, 2007,4and had surgery for his Ryndam injury.5 On September 7, 2007,
the company-designated doctor issued a medical report6 that Sibug has a permanent but incomplete
disability.7 In an email8 dated September 28, 2007, the company-designated doctor classified Sibugs
disability from his Ryndam injury as a grade 10 disability.
Issue:
Is the respondent entitled to disability benefits, illness allowance, damages and attorneys fees
against petitioners?
Law Applicable
Article 111 of the Labor Code. It is settled that where an employee was forced to litigate and, thus,
incur expenses to protect his rights and interest, the award of attorneys fees is legally and morally
justifiable.
Case History
Labor Arbiter dismissed the Volendam case on the ground that Sibug was declared fit to work after his
ACL reconstruction surgery. He also passed the pre-employment medical examination when he
sought reemployment, was reemployed and was able to work again in Ryndam. As regards the
Ryndam case, the Labor Arbiter awarded to Sibug US$10,075 which is the equivalent award for the
grade 10 disability rating issued by the company-designated doctor.
The National Labor Relations Commission (NLRC) reversed the Labor Arbiters Decision. It ruled that
Sibug is entitled to permanent and total disability benefit of US$60,000 for his Volendam injury and
another US$60,000 for his Ryndam injury. It also awarded attorneys fees to Sibug.
The CA ruled that Sibug was unable to perform his customary work for more than 120 days on
account of his Volendam and Ryndam injuries. Thus, he is entitled to permanent and total disability
benefit for both injuries.
Ruling
SC render a new judgment and ORDER petitioners United Philippine Lines, Inc. and Holland America
Line jointly and severally to pay respondent Generoso E. Sibug US$66,000 or its peso equivalent at
the time of payment. In addition, we grant Sibug attorneys fees of US$6,000 since he was forced to
litigate to protect his valid claim. Where an employee is forced to litigate and incur expenses to protect
his right and interest, he is entitled to an award of attorneys fees equivalent to 10% of the award
Opinion

In Fil-Pride Shipping Company, Inc., et al. v. Balasta, we held that the "company-designated physician
must arrive at a definite assessment of the seafarers fitness to work or permanent disability within the
period of 120 or 240 days, pursuant to Article 192 (c)(1) of the Labor Code and Rule X, Section 2 of
the Amended Rules on Employees Compensation. If he fails to do so and the seafarers medical
condition remains unresolved, the latter shall be deemed totally and permanently disabled."

G.J.T. REBUILDERS MACHINE SHOP, GODO FREDO TRILLANA, and JULIANA

TRILLANA, Petitioners,
vs.
RICARDO AMBOS, BENJAMIN PUTIAN, and RUSSELL AMBOS, Respondents.
G.R. No. 174184
January 28, 2015
LEONEN, J.:
Facts:
G.J.T. Rebuilders is a single proprietorship owned by the Spouses Godofredo and Juliana Trillana
(Trillana spouses). It was engaged in steel works and metal fabrication, employing Ricardo Ambos
(Ricardo), Russell Ambos (Russell), and Benjamin Putian (Benjamin) as machinists.
Due to the damage sustained by the building, its owner notified its tenants to vacate their rented units
by the end of September 1996 "to avoid any unforeseen accidents which may arise due to the
damage."7
Despite the building owners notice to vacate, G.J.T. Rebuilders continued its business in the
condemned building. When the building owner finally refused to accommodate it, G.J.T. Rebuilders
left its rented space and closed the machine shop on December 15, 1997. 8 It then filed an Affidavit of
Closure before the Department of Labor and Employment on February 16, 1998 and a sworn
application to retire its business operations before the Mandaluyong City Treasurers Office on
February 25, 1998.
Having lost their employment without receiving separation pay, Ricardo, Russell, and Benjamin filed a
Complaint for illegal dismissal before the Labor Arbiter. They prayed for payment of allowance,
separation pay, and attorneys fees.
Issue:
Are the respondents entitled to attorney's fees?
Law Applicable
Art. 111. Attorneys fees.
1. In cases of unlawful withholding of wages, the culpable party may be assessed attorneys
fees equivalent to ten percent of the amount of wages recovered.
2. It shall be unlawful for any person to demand or accept, in any judicial or administrative
proceedings for the recovery of wages, attorneys fees which exceed ten percent of the
amount of wages recovered.
Case History
Labor Arbiter Leda, in the Decision dated December 28, 1999, found that Ricardo, Russell, and
Benjamin were entitled to separation pay under Article 283 of the Labor Code. In addition, they were
awarded attorneys fees, having been constrained to litigate their claims.
National Labor Relations Commission vacated and set aside Labor Arbiter Ledas Decision and
dismissed the Complaint for lack of merit. Since the Commission found that G.J.T. Rebuilders ceased
operations due to serious business losses, it held that G.J.T. Rebuilders and the Trillana spouses
need not pay Ricardo, Russell, and Benjamin separation pay.
The Court of Appeals reversed the National Labor Relations Commissions Decision, agreeing with
Labor Arbiter Leda that G.J.T. Rebuilders failed to prove its alleged serious business losses. The
Court of Appeals conceded that G.J.T. Rebuilders had to close the machine shop for reasons

connected with the fire that partially destroyed the building where it was renting space. Nevertheless,
G.J.T. Rebuilders continued its business for more than one year after the fire. Thus, according to the
Court of Appeals, G.J.T. Rebuilders did not suffer from serious business losses but closed the
machine shop to prevent losses.
Ruling
The Supreme Court ruled there is no unlawful withholding of wages or an award of attorneys fees
arising from collective bargaining negotiations. Neither did the Labor Arbiter nor the Court of Appeals
make findings of fact or cite the applicable law in awarding attorneys fees. That respondents were
"constrained to engage the services of counsel to prosecute their claims" is not enough justification
since "no premium should be placed on the right to litigate.
Opinion
Serious business losses, employers must present in evidence financial statements showing the net
losses suffered by the business within a sufficient period of time. Generally, it cannot be based on a
single financial statement showing losses. Absent this proof, employers closing their businesses must
pay the dismissed employees separation pay equivalent to one-month pay or to at least one-halfmonth pay for every year of service, whichever is higher.

EVANGELINA MASMUD (as substitute complainant for ALEXANDER J. MASMUD),Petitioner

Vs. NATIONAL LABOR RELATIONS COMMISSION (First Division) and ATTY. ROLANDO B. GO, JR.,
Respondents.
G.R. No. 183385 February 13, 2009
NACHURA, J.:
Facts
On July 9, 2003, Evangelina Masmuds (Evangelina) husband, the late Alexander J. Masmud
(Alexander), filed a complaint[3] against First Victory Shipping Services and Angelakos (Hellas) S.A. for
non-payment of permanent disability benefits, medical expenses, sickness allowance, moral and
exemplary damages, and attorney's fees. Alexander engaged the services of Atty. Rolando B. Go, Jr.
(Atty. Go) as his counsel.
In consideration of Atty. Gos legal services, Alexander agreed to pay attorney's fees on a contingent
basis, as follows: twenty percent (20%) of total monetary claims as settled or paid and an additional
ten percent (10%) in case of appeal. It was likewise agreed that any award of attorney's fees shall
pertain to respondent's law firm as compensation.
Dissatisfied, Atty. Go filed a motion to record and enforce the attorneys lien alleging that Evangelina
reneged on their contingent fee agreement. Evangelina paid only the amount of P680,000.00,
equivalent to 20% of the award as attorneys fees, thus, leaving a balance of 10%, plus the award
pertaining to the counsel as attorneys fees.
In response to the motion filed by Atty. Go, Evangelina filed a comment with motion to release the
amount deposited with the NLRC Cashier. In her comment, Evangelina manifested that Atty. Gos
claim for attorneys fees of 40% of the total monetary award was null and void based on Article 111 of
the Labor Code.
Issue:
Is the respondent lawyer claim of 40% of the monetary award in labor cases as attorney's fees
tenable?
Law Applicable
ART. 111. Attorney's fees. (a) In cases of unlawful withholding of wages the culpable party
may be assessed attorney's fees equivalent to ten percent of the amount of the wages
recovered.
Section 24, Rule 138 of the Rules of Court
SEC. 24. Compensation of attorney's; agreement as to fees. An attorney shall be entitled to have and
recover from his client no more than a reasonable compensation for his services, with a view to the
importance of the subject matter of the controversy, the extent of the services rendered, and the
professional standing of the attorney. No court shall be bound by the opinion of attorneys as expert
witnesses as to the proper compensation, but may disregard such testimony and base its conclusion
on its own professional knowledge. A written contract for services shall control the amount to be paid
therefor unless found by the court to be unconscionable or unreasonable.
CANON 20 A LAWYER SHALL CHARGE ONLY FAIR AND REASONABLE FEES.
Rule 20.01. A lawyer shall be guided by the following factors in determining his fees:
(a) The time spent and the extent of the services rendered or required;

(b) The novelty and difficulty of the question involved;

(c) The importance of the subject matter;
(d) The skill demanded;
(e) The probability of losing other employment as a result of acceptance of the
proffered case;
(f) The customary charges for similar services and the schedule of fees of the IBP
Chapter to which he belongs;
(g) The amount involved in the controversy and the benefits resulting to the client
from the service;
(h) The contingency or certainty of compensation;
(i) The character of the employment, whether occasional or established; and
(j) The professional standing of the lawyer.
Case History
On February 14, 2005, the LA issued an Order[7] granting Atty. Gos motion, the fallo of which reads:
WHEREFORE, premises considered, and further considering the substitute complainants initial
payment of 20% to movant-counsel of the monetary claims as paid, let the balance or unpaid twenty
(20%) per cent of attorney's fees due movant-counsel (or the amount of P839,587.39) be recorded as
lien upon all the monies that may still be paid to substitute complainant Evangelina Masmud.
Accordingly, the NLRC Cashier is directed to pay movant-counsel the amount of P677,589.96 which is
currently deposited therein to partially satisfy the lien
On January 31, 2006, the NLRC issued a Resolution dismissing the appeal for lack of merit.
CA issued a Resolution denying the motion for reconsideration for lack of merit. WHEREFORE, the
petition is PARTIALLY GRANTED. The Resolutions dated January 31, 2006 and July 18, 2006 are
hereby AFFIRMED with MODIFICATION in that the Attorneys fees of respondent Atty. Rolando B.
Go, Jr. is declared fully compensated by the amount of P1,347,950.11 that he has already received.
Ruling:
The Supreme Court affirmed the decision of the Court of Appeals.
Opinion
Considering that Atty. Go successfully represented his client, it is only proper that he should receive
adequate compensation for his efforts. I agree with the reduction of the award of attorney's fees by the
CA, the fact that a lawyer plays a vital role in the administration of justice emphasizes the need to
secure to him his honorarium lawfully earned as a means to preserve the decorum and respectability
of the legal profession. A lawyer is as much entitled to judicial protection against injustice or imposition
of fraud on the part of his client as the client is against abuse on the part of his counsel. The duty of
the court is not alone to ensure that a lawyer acts in a proper and lawful manner, but also to see that a
lawyer is paid his just fees. With his capital consisting of his brains and with his skill acquired at
tremendous cost not only in money but in expenditure of time and energy, he is entitled to the
protection of any judicial tribunal against any attempt on the part of his client to escape payment of his
just compensation. It would be ironic if after putting forth the best in him to secure justice for his client,
he himself would not get his due.

PCL Shipping Philippines vs. NLRC and Steve Rusel

GR 153031 December 14, 2006
Austria-Martinez
Facts

In April 1996, Rusel was employed as GP/AB seaman by manning agency, PCL Shipping
Philippines, Inc. (PCL Shipping) for and in behalf of its foreign principal, U-Ming Marine
Transport Corporation (U-Ming Marine). Rusel thereby joined the vessel MV Cemtex General
(MV Cemtex) for the contract period of twelve (12) months with a basic monthly salary of
US$400.00, living allowance of US$140.00, fixed overtime rate of US$120.00 per month,
vacation leave with pay of US$40.00 per month and special allowance of US$175.00.

On July 16, 1996, while Rusel was cleaning the vessels kitchen, he slipped, and as a
consequence thereof, he suffered a broken and/or sprained ankle on his left foot. A request
for medical examination was flatly denied by the captain of the vessel. On August 13, 1996,
feeling an unbearable pain in his ankle, Rusel jumped off the vessel using a life jacket and
swam to shore. He was brought to a hospital where he was confined for eight (8) days.

On August 22, 1996, a vessels agent fetched Rusel from the hospital and was required to
board a plane bound for the Philippines.

On September 26, 1996, Rusel filed a complaint for illegal dismissal, non-payment of wages,
overtime pay, claim for medical benefits, sick leave pay and damages against PCL Shipping
and U-Ming Marine before the arbitration branch of the NLRC. In their answer, the latter
alleged that Rusel deserted his employment by jumping off the vessel.

Issue:

Is the respondent Rusel entitled to Attorney's fees?

Law Applicable

Art. 111. Attorneys fees. (a) In cases of unlawful withholding of wages, the
culpable party may be assessed attorneys fees equivalent to ten percent of the
amount of wages recovered x x x

Case History

On July 21, 1998, the labor arbiter rendered his decision, duly considered we find the respondent
liable for unjust repatriation of the complainant.
the NLRC affirmed the findings of the Labor Arbiter but modified the appealed Decision, disposing as
follows:
WHEREFORE, premises considered, the assailed decision is as it is hereby ordered MODIFIED in
that the amount representing three months salary of the complainant due to his illegal dismissal is
reduced to US$1,620.00. Further the award of sick wage benefit is deleted.
All other dispositions are AFFIRMED.
CA dismissed the petition and affirmed the NLRC Decision.
Ruling
The Supreme Court held As a consequence, he is compelled to file an action for the recovery of his
lawful wages and other benefits and, in the process, incurred expenses. On these bases, the Court
finds that he is entitled to attorney's fees.
WHEREFORE, the petition is PARTLY GRANTED. The Court of Appeals Decision dated December
18, 2001 and Resolution dated April 10, 2002 are AFFIRMED with MODIFICATION to the effect that
the award of US$1620.00 representing private respondents three months salary is reduced to
US$1200.00. The award of US$550.00 representing private respondents living allowance, overtime
pay, vacation pay and special allowance for two months is deleted and in lieu thereof, an award of
US$710.00 is granted representing private respondents living allowance, special allowance and
vacation leave with pay for the same period.

SAMEER OVERSEAS PLACEMENT AGENCY, INC., Petitioner, v. JOY C. CABILES, Respondent.

G.R. No. 170139, August 05, 2014
LEONEN, J.

Facts:
Petitioner, Sameer Overseas Placement Agency, Inc., is a recruitment and placement
agency.5 Responding to an ad it published, respondent, Joy C. Cabiles, submitted her application for a
quality control job in Taiwan.
Joys application was accepted. Joy was later asked to sign a one-year employment contract for a
monthly salary of NT$15,360.00. She alleged that Sameer Overseas Agency required her to pay a
placement fee of P70,000.00 when she signed the employment contract.
Joy was deployed to work for Taiwan Wacoal, Co. Ltd. (Wacoal) on June 26, 1997. She alleged that in
her employment contract, she agreed to work as quality control for one year. In Taiwan, she was
asked to work as a cutter.
She claimed that she was illegally dismissed. She asked for the return of her placement fee, the
withheld amount for repatriation costs, payment of her salary for 23 months as well as moral and
exemplary damages.19 She identified Wacoal as Sameer Overseas Placement Agencys foreign
principal.

Sameer Overseas Placement Agency alleged that respondent's termination was due to her
inefficiency, negligence in her duties, and her failure to comply with the work requirements [of] her
foreign [employer].
Issue
Whether or not Cabiles is Entitled to attorney's fees.
Law Applicable
Art. 282. Termination by employer. An employer may terminate an employment for any of the following
causes:cralawlawlibrary
(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or
representative in connection with his work;chanroblesvirtuallawlibrary
(b) Gross and habitual neglect by the employee of his duties;chanroblesvirtuallawlibrary
(c) Fraud or willful breach by the employee of the trust reposed in him by his employer or duly
authorized representative;chanroblesvirtuallawlibrary
(d) Commission of a crime or offense by the employee against the person of his employer or any
immediate member of his family or his duly authorized representatives;
andChanRoblesVirtualawlibrary
(e) Other causes analogous to the foregoing.
Article 111. Attorneys Fees (a) In cases of unlawful withholding of wages, the culpable party may be
assessed attorneys fees equivalent to ten percent of the amount of wages recovered.
Case History
On July 29, 1998, the Labor Arbiter dismissed Joys complaint. 31 Acting Executive Labor Arbiter Pedro
C. Ramos ruled that her complaint was based on mere allegations. 32 The Labor Arbiter found that
there was no excess payment of placement fees, based on the official receipt presented by
petitioner.33 The Labor Arbiter found unnecessary a discussion on petitioners transfer of obligations to
Pacific34 and considered the matter immaterial in view of the dismissal of respondents complaint
The National Labor Relations Commission awarded respondent only three (3) months worth of salary
in the amount of NT$46,080, the reimbursement of the NT$3,000 withheld from her, and attorneys
fees of NT$300.
The Court of Appeals50 affirmed the decision of the National Labor Relations Commission with respect
to the finding of illegal dismissal, Joys entitlement to the equivalent of three months worth of salary,
reimbursement of withheld repatriation expense, and attorneys fees.
Ruling
The SC held, WHEREFORE, the petition is DENIED. The decision of the Court of Appeals
is AFFIRMED with modification. Petitioner Sameer Overseas Placement Agency is ORDERED to pay
respondent Joy C. Cabiles the amount equivalent to her salary for the unexpired portion of her
employment contract at an interest of 6% per annum from the finality of this judgment. Petitioner is
also ORDERED to reimburse respondent the withheld NT$3,000.00 salary and pay respondent
attorneys fees of NT$300.00 at an interest of 6% per annum from the finality of this judgment.
Opinion
The burden of proving that there is just cause for termination is on the employer. The employer must
affirmatively show rationally adequate evidence that the dismissal was for a justifiable cause.Failure

to show that there was valid or just cause for termination would necessarily mean that the dismissal
was illegal.