LAND AND HOUSING DEVELOPMENT CORPORATION and ABV ROCK GROUP, v. MARIANITO C. ESQUILLO G.R. No.

152012 FACTS: [Respondent] subsequently received the amount of twenty-three thousand, one hundred fifty-three 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 Although [respondents] 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. [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 [respondents] employment papers. 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] ISSUES: Whether respondent, despite having executed a quitclaim, is entitled to a grant of his additional monetary claims.

RULING: The Petition has no merit. 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 respondents 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 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 paymen t 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. Petitioners claim that the foregoing Release and Quitclaim has forever released them from any and all c laims, demands, dues, actions, or causes of action arising from respondents 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 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. 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. 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
1

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. 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. 75704 July 19, 1989 RUBBERWORLD (PHILS.), INC. and ELPIDIO HIDALGO, petitioners, vs.,THE NATIONAL LABOR RELATIONS COMMISSION (THIRD DIVISION) and NESTOR MALABANAN,respondents. FACTS: Respondent Malabanan was employed by petitioner Rubberworld (Phils.), Inc. on September 25, 1978 as an ordinary clerk. In May, 1980, he was promoted to the position of production scheduler with a corresponding salary increase. He was again transferred to the Inventory Control Section as stock clerk on September 1, 1983. On April 6,1984, Elpidio Hidalgo, the Plant I General Manager of petitioner company, received a copy of the Financial Audit Report from the Internal Audit Department of the company showing a significant material variance between the year-end actual inventory and that of the Cards (SC)/EDP Control Records. As a result thereof, Noel Santiago, Section Head of the Inventory Control Section, where respondent Malabanan was assigned, conducted an investigation of the reported discrepancies in the stock cards upon the request of the Plant General Manager. Santiago then submitted his report to the general manager recommending the dismissal of respondent Malabanan. Consequently, Malabanan's case was endorsed to the Human Resources Division of petitioner company, which conducted a reinvestigation on the matter and which affirmed the recommendation of the Inventory Control Section Head for the termination of employment of respondent Malabanan. On June 16, 1984, respondent Malabanan, along with another complainant named Jonathan Transmit, filed a complaint for unfair labor practice and illegal dismissal against petitioner company alleging that they (respondent Malabanan and complainant Transmil) were members of the monthly salaried employees' union affiliated with TUPAS; that petitioner company forced them to disaffiliate from the union; and that due to their refusal to resign from the union, they were ultimately dismissed from employment by petitioner company. Petitioner company on the other hand, denied complainants' allegations and averred that respondent Malabanan's dismissal was due to gross and habitual neglect of his duty and not due to his union affiliation. On June 17, 1986, respondent Commission reversed the appealed decision of the Labor Arbiter and stated, inter alia: On January 30, 1985, the Labor Arbiter rendered a decision (pp. 17- 22, Rollo), the dispositive portion of which reads: WHEREFORE, premises considered, this case should be, as it is hereby, DISMISSED, for lack of merit. Confronted with this factual backgrounds, we find ourselves inclined to the view that the appealed decision merits a reversal. On September 3, 1986, petitioner filed the instant petition contending that the respondent Commission committed grave abuse of discretion amounting to lack of jurisdiction in reversing the Labor Arbiter's decision ISSUE: (1) whether or not the dismissal of respondent Malabanan is tainted with unfair labor practice; and (2) whether or not a just and valid cause exists for the dismissal of private respondent Malabanan RULING: We believe that the foregoing contentions are impressed with merit. Art. 248 of the Labor Code, PD No. 442, as amended, provides: Art. 248. Unfair labor practices of employers. It shall be unlawful for an employer to commit any of the following unfair labor practices: (a) To interfere with, restrain or coerce employees in the exercise of their right to self-organization; xxx The question of whether an employee was dismissed because of his union activities is essentially a question of fact as to which the findings of the administrative agency concerned are conclusive and binding if supported by substantial evidence. Substantial evidence has been defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. It means such evidence which affords a substantial basis from which the fact in issue can be reasonably inferred The findings of the Labor Arbiter on the non-existence of unfair labor practice on the part of the company are more in accord and supported by the evidence submitted by the parties in the instant case, to wit: Complainant had stated that he was a member of the monthly salaried employees union affiliated with TUPAS. He, however, offered no proof to support his allegation. In fact, no evidence was presented to prove the existence of such union. We (note] from the records that, as the usual practice, in cases like this one, complainant is usually supported by the union of which he is a member. And ordinarily, the union itself is impleaded as a co- complainant. Such circumstances, surprisingly, [are] not present in this case In fact, complainant categorically alleged that he had solicited the services of the PAFLU Labor Union in filing this case. It is, indeed, surprising that complainant had to solicit the help of a labor union (PAFLU) of which he was not a member instead of soliciting the aid of the labor union (TUPAS) of which he was allegedly a member. These circumstances alone [destroy] the credibility of complainant's allegations Nowhere in the records can We find that the company actually performed positive acts to restrain the union participation of private respondent. For one, it is doubtful whether Malabanan was really engaged in the organization of a labor union affiliated with the federation TUPAS As a rule, it is the prerogative of the company to promote, transfer or even demote its employees to other positions when the interests of the company reasonably demand it. Unless there are instances which directly point to interference by the company with the employees' right to self-organization, the transfer of private respondent should be considered as within the bounds allowed by law. Furthermore, although private respondent was transferred to a lower position, his original rank and salary remained undiminished, which fact was not refuted or questioned by private respondent. In view of the foregoing conclusions of the Labor Arbiter, We are compelled to agree with the latter that the petitioner company did not commit any unfair labor practice in transferring and thereafter dismissing private respondent. Article 282. Termination by employer. An employer may terminate an employment for any of the following just causes: xxx b) Gross and habitual neglect by the employee of his duties; The remaining issue to be resolved on this point is whether the dismissal of respondent Malabanan was for a just and lawful cause. Even assuming for the sake of argument that herein complainant 'posted entries in the stock card without counter checking the actual movement status of the items at the warehouse, thereby resulting in an inaccurate posting of data on the stock cards," to our impression does not constitute as a just cause for dismissal. Records show that he was only transferred to the Inventory Control Section on September 1, 1983 and was not so familiar and experienced as a stock clerk, and prior to his transfer, the record shows no derogatory records in terms of his performance. His
3

failure to carry out efficiently his duties as a stock clerk is not so gross and habitual. In other words he was not notoriously negligent to warrant his severance from the service. Considering that there is nothing on record that shows that he willfully defied instructions of his superior with regards to his duties and that he gained personal benefit of the discrepancy, his dismissal is unwarranted. Assuming, in gratia argumenti that the private respondent had indeed committed the said mistakes in the posting of accurate data, this was only his first infraction with regard to his duties. It would thus be cruel and unjust to mete out the drastic penalty of dismissal, for it is not proportionate to the gravity of the misdeed. It is worthy to note that the prerogative of management to dismiss or lay-off an employee must be done without abuse of discretion, for what is at stake is not only petitioner's position, but also his means of livelihood. This is so because the preservation of the lives of the citizens is a basic duty of the State, more vital than the preservation of corporate profits ACCORDINGLY, the petition is DISMISSED for lack of merit. However, the decision of the public respondent is hereby MODIFIED to the effect that petitioner company is ordered to reinstate private respondent Nestor Malabanan to the position of stock clerk or substantially equivalent position, with the same rank and salary he is enjoying at the time of his termination, with three years backwages and without loss of seniority rights and benefits appurtenant thereto. Should the reinstatement of the private respondent as herein ordered be rendered impossible by the supervention of circumstances which prevent the same, the petitioner is further ordered to pay private respondent separation pay equivalent to one (1) month's salary for every year of service rendered, computed at his last rate of salary.

G.R. No. L-62207 December 15, 1986 JUAN BONIFACIO, petitioner-appellant, vs. GOVERNMENT SERVICE INSURANCE SYSTEM [Ministry of Education & Culture] and EMPLOYEES' COMPENSATION COMMISSION, respondents-appellees FACTS: The late Lourdes Bonifacio was a classroom teacher assigned to the district of Bagamanoc, Division of Catanduanes, Ministry of Education and Culture from August, 1965 until she contracted carcinoma of the breast with metastases to the gastrointestinal 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 gastrointestinal tract was enveloped by carcinoma. Despite chemotherapy, she died on October 5, 1978 from carcinoma of the breast metastatic to gastrointestinal 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 gastrointestinal 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. ISSUES: a] The respondent Commission's affirmance of the denial by respondent System totally ignored the Supreme Court's pronouncements on compensation cases; and b] 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 RULING: 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 determine 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 fisted 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 11, Amended Rules on Employees Compensation]. Carcinoma of the breast with metastases to the gastrointestinal tract and lungs is not listed by the Commission as an occupational disease. 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 contrary, that it arose out of it." [Hernandez vs. ECC, et. al. L-20202, May 31, 1965]. 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. 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." 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 Compensation Commission denying the claim are affirmed. No costs

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. FACTS: 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. 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.

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. The NLRC affirmed the POEA decision. 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. ISSUE: Whether 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. RULING: 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. 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. . . . 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

G.R. No. L-52415 October 23, 1984

6

INSULAR BANK OF ASIA AND AMERICA EMPLOYEES' UNION (IBAAEU), petitioner, vs. HON. AMADO G. INCIONG, Deputy Minister, Ministry of Labor and INSULAR BANK OF ASIA AND AMERICA, respondents FACTS: On June 20, 1975, petitioner filed a complaint against the respondent bank for the payment of holiday pay before the then Department of Labor, National Labor Relations Commission, Regional Office No. IV in Manila. Conciliation having failed, and upon the request of both parties, the case was certified for arbitration on July 7, 1975 (p. 18, NLRC rec. On August 25, 1975, Labor Arbiter Ricarte T. Soriano rendered a decision in the above-entitled case, granting petitioner's complaint for payment of holiday pay The records disclosed that employees of respondent bank were not paid their wages on unworked regular holidays as mandated by the Code, particularly Article 208 This conclusion is deduced from the fact that the daily rate of pay of the bank employees was computed in the past with the unworked regular holidays as excluded for purposes of determining the deductible amount for absences incurred Thus, if the employer uses the factor 303 days as a divisor in determining the daily rate of monthly paid employee, this gives rise to a presumption that the monthly rate does not include payments for unworked regular holidays. The use of the factor 303 indicates the number of ordinary working days in a year (which normally has 365 calendar days), excluding the 52 Sundays and the 10 regular holidays. The use of 251 as a factor (365 calendar days less 52 Saturdays, 52 Sundays, and 10 regular holidays) gives rise likewise to the same presumption that the unworked Saturdays, Sundays and regular holidays are unpaid. This being the case, it is not amiss to state with certainty that the instant claim for wages on regular unworked holidays is found to be tenable and meritorious Ordering respondent to pay wages to all its employees for all regular holidays since November 1, 1974 (pp. 97-99, rec., underscoring supplied). Respondent bank did not appeal from the said decision. Instead, it complied with the order of Arbiter Ricarte T. Soriano by paying their holiday pay up to and including January, 1976 On December 16, 1975, Presidential Decree No. 850 was promulgated amending, among others, the provisions of the Labor Code on the right to holiday pay Accordingly, on February 16, 1976, by authority of Article 5 of the same Code, the Department of Labor (now Ministry of Labor) promulgated the rules and regulations for the implementation of holidays with pay On April 23, 1976, Policy Instruction No. 9 was issued by the then Secretary of Labor (now Minister) interpreting the above-quoted rule, Respondent bank, by reason of the ruling laid down by the aforecited rule implementing Article 94 of the Labor Code and by Policy Instruction No. 9, stopped the payment of holiday pay to an its employees On October 18, 1976, Labor Arbiter Ricarte T. Soriano, instead of issuing a writ of execution, issued an order enjoining the respondent bank to continue paying its employees their regular holiday pay on the following grounds: (a) that the judgment is already final and the findings which is found in the body of the decision as well as the dispositive portion thereof is res judicata or is the law of the case between the parties; and (b) that since the decision had been partially implemented by the respondent bank, appeal from the said decision is no longer available On June 20, 1978, the National Labor Relations Commission promulgated its resolution en banc dismissing respondent bank's appeal, On November 10, 1979, the Office of the Minister of Labor, through Deputy Minister Amado G. Inciong, issued an order, the dispositive portion of which states ALL THE FOREGOING CONSIDERED, let the appealed Resolution en banc of the National Labor Relations Commission dated 20 June 1978 be, as it is hereby, set aside and a new judgment promulgated dismissing the instant case for lack of merit (p. 436, NLRC rec.). Hence, this petition for certiorari charging public respondent Amado G. Inciong with abuse of discretion amounting to lack or excess of jurisdiction. ISSUE: Whether or not the decision of a Labor Arbiter awarding payment of regular holiday pay can still be set aside on appeal by the Deputy Minister of Labor even though it has already become final and had been partially executed, the finality of which was affirmed by the National Labor Relations Commission sitting en banc, on the basis of an Implementing Rule and Policy Instruction promulgated by the Ministry of Labor long after the said decision had become final and executory. RULING: WE agree with the petitioner's contention that Section 2, Rule IV, Book III of the implementing rules and Policy Instruction No. 9 issued by the then Secretary of Labor are null and void since in the guise of clarifying the Labor Code's provisions on holiday pay, they in effect amended them by enlarging the scope of their exclusion (p. 1 1, rec.). Article 94 of the Labor Code, as amended by P.D. 850, provides: The coverage and scope of exclusion of the Labor Code's holiday pay provisions is spelled out under Article 82; 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. ... From the above-cited provisions, it is clear that monthly paid employees are not excluded from the benefits of holiday pay. However, the implementing rules on holiday pay promulgated by the then Secretary of Labor excludes monthly paid employees from the said benefits by inserting, under Rule IV, Book Ill of the implementing rules, Section 2, which provides that: "employees who are uniformly paid by the month, irrespective of the number of working days therein, with a salary of not less than the statutory or established minimum wage shall be presumed to be paid for all days in the month whether worked or not. "
7

In the case at bar, the provisions of the Labor Code on the entitlement to the benefits of holiday pay are clear and explicit - it provides for both the coverage of and exclusion from the benefits In Policy Instruction No. 9, the then Secretary of Labor went as far as to categorically state that the benefit is principally intended for daily paid employees, when the law clearly states that every worker shall be paid their regular holiday pay. This is a flagrant violation of the mandatory directive of Article 4 of the Labor Code, which states that "All doubts in the implementation and interpretation of the provisions of this Code, including its implementing rules and regulations, shall be resolved in favor of labor." Moreover, it shall always be presumed that the legislature intended to enact a valid and permanent statute which would have the most beneficial effect that its language permits A party who waives his right to appeal is deemed to have accepted the judgment, adverse or not, as correct, especially if such party readily acquiesced in the judgment by starting to execute said judgment even before a writ of execution was issued, as in this case. Under these circumstances, to permit a party to appeal from the said partially executed final judgment would make a mockery of the doctrine of finality of judgments long enshrined in this jurisdiction Obviously, the Secretary (Minister) of Labor had exceeded his statutory authority granted by Article 5 of the Labor Code authorizing him to promulgate the necessary implementing rules and regulations While it is true that the contemporaneous construction placed upon a statute by executive officers whose duty is to enforce it should be given great weight by the courts, still if such construction is so erroneous, as in the instant case, the same must be declared as null and void. In view of the foregoing, Section 2, Rule IV, Book III of the Rules to implement the Labor Code and Policy instruction No. 9 issued by the then Secretary of Labor must be declared null and void. Accordingly, public respondent Deputy Minister of Labor Amado G. Inciong had no basis at all to deny the members of petitioner union their regular holiday pay as directed by the Labor Code It is not disputed that the decision of Labor Arbiter Ricarte T. Soriano dated August 25, 1975, had already become final, and was, in fact, partially executed by the respondent bank. it is patently unjust to deprive the members of petitioner union of their vested right acquired by virtue of a final judgment on the basis of a labor statute promulgated following the acquisition of the "right". On the question of whether or not a law or statute can annul or modify a judicial order issued prior to its promulgation, this Court, through Associate Justice Claro M. Recto, said: We are decidedly of the opinion that they did not. Said order, being unappealable, became final on the date of its issuance and the parties who acquired rights thereunder cannot be deprived thereof by a constitutional provision enacted or promulgated subsequent thereto. Neither the Constitution nor the statutes, except penal laws favorable to the accused, have retroactive effect in the sense of annulling or modifying vested rights, or altering contractual obligations" Section I of Rule 39 of the Revised Rules of Court provides that "... execution shall issue as a matter of right upon the expiration of the period to appeal ... or if no appeal has been duly perfected." This rule applies to decisions or orders of labor arbiters who are exercising quasi-judicial functions since "... the rule of execution of judgments under the rules should govern all kinds of execution of judgment, unless it is otherwise provided in other laws" Sagucio vs. Bulos 5 SCRA 803) and Article 223 of the Labor Code provides that "... decisions, awards, or orders of the Labor Arbiter or compulsory arbitrators are final and executory unless appealed to the Commission by any or both of the parties within ten (10) days from receipt of such awards, orders, or decisions. ..." Thus, under the aforecited rule, the lapse of the appeal period deprives the courts of jurisdiction to alter the final judgment and the judgment becomes final ipso jure The despotic manner by which public respondent Amado G. Inciong divested the members of the petitioner union of their rights acquired by virtue of a final judgment is tantamount to a deprivation of property without due process of law Public respondent completely ignored the rights of the petitioner union's members in dismissing their complaint since he knew for a fact that the judgment of the labor arbiter had long become final and was even partially executed by the respondent bank. A final judgment is "a vested interest which it is right and equitable that the government should recognize and protect, and of which the individual could no. be deprived arbitrarily without injustice" Tested by and pitted against this broad concept of the constitutional guarantee of due process, the action of public respondent Amado G. Inciong is a clear example of deprivation of property without due process of law and constituted grave abuse of discretion, amounting to lack or excess of jurisdiction in issuing the order dated November 10, 1979. WHEREFORE, THE PETITION IS HEREBY GRANTED, THE ORDER OF PUBLIC RESPONDENT IS SET ASIDE, AND THE DECISION OF LABOR ARBITER RICARTE T. SORIANO DATED AUGUST 25, 1975, IS HEREBY REINSTATED. COSTS AGAINST PRIVATE RESPONDENT INSULAR BANK OF ASIA AND AMERICA

G.R. No. 144664

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.

March 15, 2004

FACTS: 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] 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) 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 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 ISSUE: WHETHER OR NOT THE RESPONDENT COURT OF APPEALS and THE SECRETARY OF THE DEPARTMENT OF LABOR AND EMPLOYMENT COMMITTED GRAVE ABUSE OF DISCRETION? And; WHETHER OR NOT RESPONDENTS ACTS WILL DEPRIVE PETITIONER OF PROPERTY WITHOUT DUE PROCESS BY THE "EXPLANATORY BULLETIN" AS WELL AS EQUAL PROTECTION OF LAWS? RULING: The petition is devoid of merit [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. 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 The records of the case show that following petitioners receipt on August 18, 2000 of a copy of the August 10, 2000 Resoluti on 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. 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 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. 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 m ans welfare should be the primordial and paramount consideration. 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 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. WHEREFORE, the petition is hereby DISMISSED
9

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 FACTS: Petitioners herein were among the members of the respondent union who were expelled by the latter for disloyalty in 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. ISSUE: Whether the NLRC erred in ruling that the expulsion proceeding conducted by the Union was in accordance with its by-laws? And; Whether the requisites of due process were not complied 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? RULING: 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). 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

10

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 DIRECTOR OF LABOR, REGION X, respondents FACTS: Petitioner is a semi-government hospital, managed by the Board of Directors of the Cagayan de Oro Women's Club and Puericulture Center, headed by Mrs. Antera Dorado, as holdover President. The hospital derives its finances from the club itself as well as from paying patients, averaging 130 per month. It is also partly subsidized by the Philippine Charity Sweepstakes Office and the Cagayan De Oro City government. Petitioner has forty-one (41) employees. Aside from salary and living allowances, the employees are given food, but the amount spent therefor is deducted from their respective salaries (pp. 77-78, Rollo). On May 23, 1986, ten (10) employees of the petitioner employed in different capacities/positions filed a complaint with the Office of the Regional Director of Labor and Employment, Region X, for underpayment of their salaries and ECOLAS, which was docketed as ROX Case No. CW-71-86. 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 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, 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 ISSUE: 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. RULING: 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 both visitorial and enforcement power over labor standards cases, and is therefore empowered to adjudicate money claims, provided there still exists an employeremployee relationship, and the findings of the regional office is not contested by the employer concerned 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 Under PD 850, labor standards cases have been taken from the arbitration system and placed under the enforcement system, except where a) questions of law are involved as determined by the Regional Director, b) the amount involved exceeds P100,000.00 or over 40% of the equity of the employer, whichever is lower, c) the case requires evidentiary matters not disclosed or verified in the normal course of inspection, or d) there is no more employer-employee relationship. The purpose is clear: to assure the worker the rights and benefits due to him under labor standards laws without having to go through arbitration. The worker need not litigate to get what legally belongs to him. The whole enforcement machinery of the Department of Labor exists to insure its expeditious delivery to him free of charge Under the foregoing, a complaining employee who was denied his rights and benefits due him under labor standards law need not litigate. The Regional Director, by virtue of his enforcement power, assured "expeditious delivery to him of his rights and benefits free of charge", provided of course, he was still in the employ of the firm. In the present case, petitioner admitted the charge of underpayment of wages to workers still in its employ; in fact, it pleaded for time to raise funds to satisfy its obligation. There was thus no contest against the findings of the labor inspectors As seen from the foregoing, EO 111 authorizes a Regional Director to order compliance by an employer with labor standards provisions of the Labor Code and other legislation. It is Our considered opinion however, that the inclusion of the phrase, " The provisions of Article 217 of this Code to the contrary notwithstanding and in cases where the relationship of employer-employee still exists" ... in Article 128(b), as amended, above-cited, merely confirms/reiterates the enforcement adjudication authority of the Regional Director over uncontested money claims in cases where an employer-employee relationship still exists. 6 Viewed in the light of PD 850 and read in coordination with MOLE Policy Instructions Nos. 6, 7 and 37, it is clear that it has always been the intention of our labor authorities to provide our workers immediate access (when still feasible, as where an employer-employee relationship
11

still exists) to their rights and benefits, without being inconvenienced by arbitration/litigation processes that prove to be not only nervewracking, but financially burdensome in the long run. Social justice legislation, to be truly meaningful and rewarding to our workers, must not be hampered in its application by long-winded arbitration and litigation. Rights must be asserted and benefits received with the least inconvenience. Labor laws are meant to promote, not defeat, social justice We now come to the question of whether or not the Regional Director erred in extending the award to all hospital employees. We answer in the affirmative. The Regional Director correctly applied the award with respect to those employees who signed the complaint, as well as those who did not sign the complaint, but were still connected with the hospital at the time the complaint was filed The justification for the award to this group of employees who were not signatories to the complaint is that the visitorial and enforcement powers given to the Secretary of Labor is relevant to, and exercisable over establishments, not over the individual members/employees, because what is sought to be achieved by its exercise is the observance of, and/or compliance by, such firm/establishment with the labor standards regulations. Necessarily, in case of an award resulting from a violation of labor legislation by such establishment, the entire members/employees should benefit therefrom. As aptly stated by then Minister of Labor Augusto S. Sanchez: . . It would be highly derogatory to the rights of the workers, if after categorically finding the respondent hospital guilty of underpayment of wages and ECOLAs, we limit the award to only those who signed the complaint to the exclusion of the majority of the workers who are similarly situated. Indeed, this would be not only render the enforcement power of the Minister of Labor and Employment nugatory, but would be the pinnacle of injustice considering that it would not only discriminate but also deprive them of legislated benefits. . . . (pp. 38-39, Rollo). This view is further bolstered by the provisions of Sec. 6, Rule II of the "Rules on the Disposition of Labor Standards cases in the Regional Offices" (supra) presently enforced, viz: SECTION 6. Coverage of complaint inspection. A complaint inspection shall not be limited to the specific allegations or violations raised by the complainants/workers but shall be a thorough inquiry into and verification of the compliance by employer with existing labor standards and shall cover all workers similarly situated. (Emphasis supplied) However, there is no legal justification for the award in favor of those employees who were no longer connected with the hospital at the time the complaint was filed, having resigned therefrom in 1984, The enforcement power of the Regional Director cannot legally be upheld in cases of separated employees. Article 129 of the Labor Code, cited by petitioner (p. 54, Rollo) is not applicable as said article is in aid of the enforcement power of the Regional Director; hence, not applicable where the employee seeking to be paid underpayment of wages is already separated from the service. His claim is purely a money claim that has to be the subject of arbitration proceedings and therefore within the original and exclusive jurisdiction of the Labor Arbiter. ACCORDINGLY, this petition should be dismissed, as it is hereby DISMISSED, as regards all persons still employed in the Hospital at the time of the filing of the complaint, but GRANTED as regards those employees no longer employed at that time.

12

G.R. No. L-69870 November 29, 1988 NATIONAL SERVICE CORPORATION (NASECO) AND ARTURO L. PEREZ, petitioners, vs. THE HONORABLE THIRD DIVISION, NATIONAL LABOR RELATIONS COMMISSION, MINISTRY OF LABOR AND EMPLOYMENT, MANILA AND EUGENIA C. CREDO, respondents. G.R. No. 70295 November 29,1988 EUGENIA C. CREDO, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, NATIONAL SERVICES CORPORATION AND ARTURO L. PEREZ, respondents FACTS: Eugenia C. Credo was an employee of the National Service Corporation (NASECO), a domestic corporation which provides security guards as well as messengerial, janitorial and other similar manpower services to the Philippine National Bank (PNB) and its agencies. She was first employed with NASECO as a lady guard on 18 July 1975. Through the years, she was promoted to Clerk Typist, then Personnel Clerk until she became Chief of Property and Records, on 10 March 1980. 1 Sometime before 7 November 1983, Credo was administratively charged by Sisinio S. Lloren, Manager of Finance and Special Project and Evaluation Department of NASECO, stemming from her non-compliance with Lloren's memorandum, dated 11 October 1983, regarding certain entry procedures in the company's Statement of Billings Adjustment. Said charges alleged that Credo "did not comply with Lloren's instructions to place some corrections/additional remarks in the Statement of Billings Adjustment; and when [Credo] was called by Lloren to his office to explain further the said instructions, [Credo] showed resentment and behaved in a scandalous manner by shouting and uttering remarks of disrespect in the presence of her co-employees." 2 On 7 November 1983, Credo was called to meet Arturo L. Perez, then Acting General Manager of NASECO, to explain her side before Perez and NASECO's Committee on Personnel Affairs in connection with the administrative charges filed against her. After said meeting, on the same date, Credo was placed on "Forced Leave" status for 1 5 days, effective 8 November 1983. 3 Before the expiration of said 15-day leave, or on 18 November 1983, Credo filed a complaint, docketed as Case No. 114944-83, with the Arbitration Branch, National Capital Region, Ministry of Labor and Employment, Manila, against NASECO for placing her on forced leave, without due process. 4 Likewise, while Credo was on forced leave, or on 22 November 1983, NASECO's Committee on Personnel Affairs deliberated and evaluated a number of past acts of misconduct or infractions attributed to her. The committee recommended Credo's termination, with forfeiture of benefits. 7 After both parties had submitted their respective position papers, affidavits and other documentary evidence in support of their claims and defenses, on 9 May 1984, the labor arbiter rendered a decision: 1) dismissing Credo's complaint, and 2) directing NASECO to pay Credo separation pay equivalent to one half month's pay for every year of service. 11

ISSUE: Whether the NLRC acted with grave abuse of discretion in finding that: 1) petitioners violated the requirements mandated by law on termination, 2) petitioners failed in the burden of proving that the termination of Credo was for a valid or authorized cause, 3) the alleged infractions committed by Credo were not proven or, even if proved, could be considered to have been condoned by petitioners, and 4) the termination of Credo was not for a valid or authorized cause. RULING: As guidelines for employers in the exercise of their power to dismiss employees for just causes, the law provides that: Section 2. Notice of dismissal. Any employer who seeks to dismiss a worker shall furnish him a written notice stating the particular acts or omission constituting the grounds for his dismissal. xxx xxx xxx Section 5. Answer and Hearing. The worker may answer the allegations stated against him in the notice of dismissal within a reasonable period from receipt of such notice. The employer shall afford the worker ample opportunity to be heard and to defend himself with the assistance of his representative, if he so desires. Section 6. Decision to dismiss. The employer shall immediately notify a worker in writing of a decision to dismiss him stating clearly the reasons therefor. 17 These guidelines mandate that the employer furnish an employee sought to be dismissed two (2) written notices of dismissal before a termination of employment can be legally effected. These are the notice which apprises the employee of the particular acts or omissions for which his dismissal is sought and the subsequent notice which informs the employee of the employer's decision to dismiss him. Likewise, a reading of the guidelines in consonance with the express provisions of law on protection to labor 18(which encompasses the right to security of tenure) and the broader dictates of procedural due process necessarily mandate that notice of the employer's decision to dismiss an employee, with reasons therefor, can only be issued after the employer has afforded the employee concerned ample opportunity to be heard and to defend himself. In the case at bar, NASECO did not comply with these guidelines in effecting Credo's dismissal. Although she was apprised and "given the chance to explain her side" of the charges filed against her, this chance was given so perfunctorily, thus rendering illusory Credo's right to security of tenure. That Credo was not given ample opportunity to be heard and to defend herself is evident from the fact that the compliance with the injunction to apprise her of the charges filed against her and to afford her a chance to prepare for her defense was dispensed in only a day. This is not effective compliance with the legal requirements aforementioned. The fact also that the Notice of Termination of Credo's employment (or the decision to dismiss her) was dated 24 November 1983 and made effective 1 December 1983 shows that NASECO was already bent on terminating her services when she was informed on 1 December 1983 of the charges against her, and that any hearing which NASECO thought of affording her after 24 November 1983 would merely be pro forma or an exercise in futility ... where a penalty less punitive would suffice, whatever missteps may be committed by labor ought not to be visited with a consequence so severe. It is not only because of the law's concern for the working man. There is, in addition, his family to consider. Unemployment brings untold hardships and sorrows on those dependent on the wage-earner
13

Even if the allegations of improper conduct (discourtesy to superiors) were satisfactorily proven, NASECO's condonation thereof is gleaned from the fact that on 4 October 1983, Credo was given a salary adjustment for having performed in the job "at least [satisfactorily]" 27 and she was then rated "Very Satisfactory" 28as regards job performance, particularly in terms of quality of work, quantity of work, dependability, cooperation, resourcefulness and attendance Considering that the acts or omissions for which Credo's employment was sought to be legally terminated were insufficiently proved, as to justify dismissal, reinstatement is proper. For "absent the reason which gave rise to [the employee's] separation from employment, there is no intention on the part of the employer to dismiss the employee concerned." 29 And, as a result of having been wrongfully dismissed, Credo is entitled to three (3) years of backwages without deduction and qualification in view of the attendant circumstances in the case, i.e., lack of due process in effecting her dismissal, it is reasonable to award her moral damages. And, for having been compelled to litigate because of the unlawful actuations of NASECO, a reasonable award for attorney's fees in her favor is in order. It would appear that, in the interest of justice, the holding in said case should not be given retroactive effect, that is, to cases that arose before its promulgation on 17 January 1985. To do otherwise would be oppressive to Credo and other employees similarly situated, because under the same 1973 Constitution ,but prior to the ruling in National Housing Corporation vs. Juco, this Court had recognized the applicability of the Labor Code to, and the authority of the NLRC to exercise jurisdiction over, disputes involving terms and conditions of employment in government owned or controlled corporations, among them, the National Service Corporation (NASECO). The 1987 Constitution provides that: The civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government, including government-owned or controlled corporations with original charter. On the premise that it is the 1987 Constitution that governs the instant case because it is the Constitution in place at the time of decision thereof, the NLRC has jurisdiction to accord relief to the parties. As an admitted subsidiary of the NIDC, in turn a subsidiary of the PNB, the NASECO is a government-owned or controlled corporation without original charter. WHEREFORE, in view of the foregoing, the challenged decision of the NLRC is AFFIRMED with modifications. Petitioners in G.R. No. 69870, who are the private respondents in G.R. No. 70295, are ordered to: 1) reinstate Eugenia C. Credo to her former position at the time of her termination, or if such reinstatement is not possible, to place her in a substantially equivalent position, with three (3) years backwages, from 1 December 1983, without qualification or deduction, and without loss of seniority rights and other privileges appertaining thereto, and 2) pay Eugenia C. Credo P5,000.00 for moral damages and P5,000.00 for attorney's fees. If reinstatement in any event is no longer possible because of supervening events, petitioners in G.R. No. 69870, who are the private respondents in G.R. No. 70295 are ordered to pay Eugenia C. Credo, in addition to her backwages and damages as above described, separation pay equivalent to one-half month's salary for every year of service, to be computed on her monthly salary at the time of her termination on 1 December 1983

14