CASE#1

[G.R. No. 110017. January 2, 1997]

RODOLFO FUENTES, RAINERIO DURON, JULIET VISTAL, ELENA

DELLOMES, LEODEGARIO BALHINON, ROGELIO MALINAO, LILY
BASANEZ, MALIZA ELLO, VILMA NOQUERA, JESSICA CASTILLO,
ROGELIO TABLADILLO, REMELDA VISCAYA, MELANIA VISCAYA,
CELIA LUBRICO, EDITH LLACUNA, ELPIDIO FERRER, NORBERTO
MIRANDA, FERNANDO MIRANDA, CORDIO DUMAY, LEONARDO DELA
VEGA, ISIDRO ALIDO, AQUINO MACABEHA, LEOPOLDO ABAA,
PAULINO ASIS, JR., REYNALDO BLANCO, MADILYN FABON,
MARCIANA OSOK, BEBIANO OSOK, FRANCISCO SEMULTA, MARCIA
LLAMES, PRINCIPE DANIEL, MARIA BAYA, NENITA RASONABLY,
SORIANO PENALOSA, JOSE PENALOSA, RODOLFO VILLAR,
REMEGIAS DEMINGOY, TEODORO TUGOGON, DIONISIO
APOLINARIO, EDYING DE LA CRUZ, RODOLFO BUTAUAN, CRISPIN
FABON, ARCADIO FABON, NENITA SARDINOLA, ALEX LICAYAN,
MARIO DAL, BADON EDUARDO, FELISA VILLAREL, EMILY GARAN,
ROGELIO GARAN, RODOLFO COLITE, RODOLFO MENIANO, ROMERO
TERRY, ZOILO VALLEJOS, VIRGINIA BANDERA, BLANDINA LUNA,
FLAXIANA CARLON, CRESENCIO CARLON, NOTARTE LEONARDA,
EFREN CANTERE, ROWENA CAGUMAY, ALFONSO PARAJES,
VIOLETA MONTECLAR, NESTOR ALLADO, JR., APOLONIO CULATAS,
LANNIE CAPARAS, ANGELICO NUNEZ, JR., NICOLAS CANAL,
HERMOGENA TAGLOCOP, ALEJO BAUMBAD, CARLITO DE LA PENA,
AMANCIO ABOYLO, JERRY PARALES, LYDIA ALLADO, AGAPITO
ODAL, MAGNO BARIOS, FLORENDO MARIANO, SOLATORIO
BONIFACIO, RENE DEMINGOY, FELIMON ADORNO, VIRGILLO
INOCENCIO, RUEL INOCENCIO, AVELINO LUNA, ALLAN
MARCELLANA, FELIX SANCHEZ, AVELINO PANDI, VILLA SORIO,
NOEL LAS PENAS, FRANCISCO GARDO, ROGELIO CULLABA,
GEORGE RAGAR, CARMELITO CABRIADAS, ANANIAS MELLORIA,
ALFONSO ALLADO, MARLINO MARTINEZ, LINO MARTINEZ, ERNESTO
OLARAN, JOHNNY JOSAYAN, ANECITO SOBIONO, MARGARITO
DUMALAGAN, FRANCISCO CABALES, FELIX ROCERO, PABLITO
DAPAR, FRANCISCA CABALHIN, FORTUNATA BAUMBAD, CARMEN
RADAY, NICOLAS TAMON, REYNALDO CANTORIA, ELMER NAPONE,
ANTONIO VALLAR, BERNADITH TOLOZA, EMETERIA
FERRER,CLANICA CABALES, CLAUDIO OJUYLAN, ERLINDA
BLANCO, ROSITA DURON, FRANCISCA ADLAWON, CARDINAL
MAGLISANG, JOVEN ASIS, JOSE FLORES, ALICIA FLORES, JULIETO
ADORNO, LORENZO CANINES, ISAAC CELLASAY, ANDRES
INDIABLE, ARSENIO DURON, NARCISA MALASPINA, ROQUE
SUBAAN, GRACE DURON, JAIME BALMORIA, PEDRO PECASALES,
PRIMITORAGAS and GRACE GOMA, petitioners, vs. NATIONAL
LABOR RELATIONS COMMISSION, 5TH DIVISION, CAGAYAN DE ORO
CITY, AGUSAN PLANTATION INC., AND/OR CHANG CHEE
KONG, respondents.

DECISION
BELLOSILLO, J.:

The State is bound under the Constitution to afford full protection to labor
and when conflicting interests of labor and capital are to be weighed on the
scales of social justice the heavier influence of the latter should be
counterbalanced with the sympathy and compassion the law accords the less
privileged workingman. This is only fair if the worker is to be given the
opportunity and the right to assert and defend his cause not as a subordinate
but as part of management with which he can negotiate on even plane. Thus
labor is not a mere employee of capital but its active and equal partner. [1]

Petitioners, numbering seventy-five (75) in all, seek to set aside the decision
of respondent National Labor Relations Commission dated 27 November 1992
reversing that of the Labor Arbiter which granted their claims, for having been
rendered with grave abuse of discretion amounting to lack or excess of
jurisdiction.
Petitioners were regular employees of private respondent Agusan
Plantations, Inc., which was engaged in the operation of a palm tree plantation
in Trento, Agusan del Sur, since September 1982. Claiming that it was suffering
business losses which resulted in the decision of the head office in Singapore
to undertake retrenchment measures, private respondent sent notices of
termination to petitioners and the Department of Labor and Employment
(DOLE).
On 31 October 1990 petitioners filed with the DOLE office in Cagayan de
Oro City a complaint for illegal dismissal with prayer for reinstatement,
backwages and damages against private respondent Agusan Plantation, Inc.,
and/or Chang Chee Kong. In their answer respondents denied the allegations
of petitioners and contended that upon receipt of instructions from the head
office in Singapore to implement retrenchment, private respondents conducted
grievance conferences or meetings with petitioners' representative labor
organization, the Association of Trade Unions through its national president
Jorge Alegarbes, its local president and its board of directors. Private
respondents also contended that the 30-day notices of termination were duly
sent to petitioners.
After both parties submitted their position papers articulating their respective
theses, the Labor Arbiter rendered a decision on 27 May 1992 in favor of
petitioners ordering private respondents to pay the former separation pay
equivalent to fifteen (15) days pay for every year of service plus salary
differentials and attorney's fees.
On appeal by respondents to the National Labor Relations Commission, the
decision of the Labor Arbiter was reversed on 27 November 1992.
Petitioners elevated their plight to this Court on a special civil action for
certiorari under Rule 65 of the Rules of Court alleging that respondent NLRC
gravely abused its discretion amounting to lack or excess of jurisdiction in ruling
that petitioners were legally terminated from their employment. They argued
that their dismissal or retrenchment did not comply with the requirements of Art.
283 of the Labor Code.
 We sustain petitioners. The ruling of the Labor Arbiter that there was no
valid retrenchment is correct. Article 283 of the Labor Code clearly states:

Art 283. Closure of establishment and reduction of personnel. The employer may also
terminate the employment of any employee due to the installation of labor-saving
devices, redundancy, retrenchment to prevent losses or the closing or cessation of
operation of the establishment or undertaking unless the closing is for the purpose of
circumventing the provisions of the title, by serving a written notice on the workers
and the Ministry of Labor and Employment at least one (1) month before the intended
date thereof. In case of termination due to the installation of labor-saving devices or
redundancy, the worker affected thereby shall be entitled to a separation pay
equivalent to at least his one (1) month pay or to at least one (1) month pay for every
year of service, whichever is higher. In case of retrenchment to prevent losses and in
case of closure or cessation of operations of establishment or undertaking not due to
serious business losses or financial reverses, the separation pay shall be equivalent to
one (1) month pay or at least one-half (1/2) month pay for every year of service,
whichever is higher. A fraction of at least six (6) months shall be considered one (1)
whole year.

Under Art. 283 therefore retrenchment may be valid only when the following
requisites are met: (a) it is to prevent losses; (b) written notices were served on
the workers and the Department of Labor and Employment (DOLE) at least one
(1) month before the effective date of retrenchment; and, (c) separation pay is
paid to the affected workers.
The closure of a business establishment is a ground for the termination of
the services of an employee unless the closing is for the purpose of
circumventing pertinent provisions of the Labor Code. But while business
reverses can be a just cause for terminating employees, they must be
sufficiently proved by the employer. [2]

In the case before us, private respondents merely alleged in their answer
and position paper that after their officials from the head office had visited the
plantation respondent manager Chang Chee Kong received a letter from the
head office directing him to proceed immediately with the termination of
redundant workers and staff, and change the operations to contract system
against direct employment. They also alleged that after five (5) years of
operations, the return of investments of respondent company was meager; that
the coup attempt in August 1987 as well as that of December 1989 aggravated
the floundering financial state of respondent company; that the financial losses
due to lack of capital funding resulted in the non-payment of long-overdue
accounts; that the untimely cut in the supply of fertilizers and manuring
materials and equipment parts delayed the payment of salaries and the
implementation of weekly job rotations by the workers. Except for these
allegations, private respondents did not present any other documentary proof
of their alleged losses which could have been easily proven in the financial
statements which unfortunately were not shown.
There is no question that an employer may reduce its work force to prevent
losses. However, these losses must be serious, actual and real. Otherwise,[3]

this ground for termination of employment would be susceptible to abuse by

scheming employers who might be merely feigning losses in their business
ventures in order to ease out employees. [4]

Indeed, private respondents failed to prove their claim of business

losses. What they submitted to the Labor Arbiter were mere self-serving
documents and allegations. Private respondents never adduced evidence
which would show clearly the extent of losses they suffered as a result of lack
of capital funding, which failure is fatal to their cause.
As regards the requirement of notices of termination to the employees, it is
undisputed that the Notice of Retrenchment was submitted to the Department
of Labor and Employment on 12 September 1990. The findings of both the
[5]

Labor Arbiter and NLRC show that petitioners were terminated on the following
dates in 1990 after they received their notices of termination, to wit:

Name of Employee Date of Notice of Effectivity of

Termination Termination
1.Noquera, Vilma 22 Sept. 25 Sept.
2.Dumalagan, 22 Sept. 30 Sept.
Margarito
3.Osok, Marciano 20 Sept. 30 Sept.
4.Abaa, Leopoldo 01 Sept. 30 Sept.
5.Aboylo, Amancio 01 Sept. 30 Sept.
6.Allado, Nestor Jr. 01 Sept. 30 Sept.
7.Bandera, Verginia 01 Sept. 30 Sept.
8.Basanez, Lily 01 Sept. 30 Sept.
9.Baumbad, Alejo 01 Sept. 30 Sept.
10.Blanco, Myrna 01 Sept. 30 Sept.
11.Blanco, Reynaldo 01 Sept. 30 Sept.
12.Canal, Marieto 01 Sept. 30 Sept.
13.Fabon, Madilyn 01 Sept. 30 Sept.
14.Ferrer, Elpidio 01 Sept. 30 Sept.
15.Meniano, Rodolfo 01 Sept. 30 Sept.
16.Nunez, Angelico 01 Sept. 30 Sept.
17.Osok, Bebiano 01 Sept. 30 Sept.
18.Penaloga, Jose Jr. 01 Sept. 30 Sept.
19.Taglocop, Hermogena 01 Sept. 30 Sept.
20.Allado, Lydio 22 Aug. 30 Sept.
21.Baya, Maria 22 Aug. 30 Sept.
22.Carlon, Flaviana 22 Aug. 30 Sept.
23.Carlon, Cresencio 22 Aug. 30 Sept.
24.Culaba, Rogelio 22 Aug. 30 Sept.
25.Cabriades, 22 Aug. 30 Sept.
Carmelito
26.Dellomes, Elma 22 Aug. 30 Sept.
27.Fabon, Arcadio 22 Aug. 30 Sept.
28.Gordo, Francisco 22 Aug. 30 Sept.
29.Inocencio, Virgilio 22 Aug. 30 Sept.
30.Inocencio, Ruel 22 Aug. 30 Sept.
31.Luna, Blandina 22 Aug. 30 Sept.
32.Luna, Avelino 22 Aug. 30 Sept.
33.Lubrico, Celia 22 Aug. 30 Sept.
 34.Monteclar, Violeta 22 Aug. 25 Sept.
35.Macabecha, Aquino 22 Aug. 25 Sept.
36.Melloria, Ananian 22 Aug. 25 Sept.
37.Malinao, Rogelio 22 Aug. 25 Sept.
38.Leonarda, Notarte 22 Aug. 25 Sept.
39.Parejas, Jerry 22 Aug. 25 Sept.
40.Parejas, Alfonso 22 Aug. 25 Sept.

41.Sardinola, Alfonso 22 Aug. 25 Sept.

42.Solaterio, Bonifacio 22 Aug. 25 Sept.

Culled from the above data, the termination of petitioners could not have
validly taken effect either on 25 or 30 September 1990. The one-month notice
of retrenchment filed with the DOLE and served on the workers before the
intended date thereof is mandatory. Private respondents failed to comply with
this requisite. The earliest possible date of termination should be 12 October
1990 or one (1) month after notice was sent to DOLE unless the notice of
termination was sent to the workers later than the notice to DOLE on 12
September 1990, in which case, the date of termination should be at least one
(1) month from the date of notice to the workers. Petitioners were terminated
less than a month after notice was sent to DOLE and to each of the workers.
We agree with the conclusion of the Labor Arbiter that the termination of the
services of petitioners was illegal as there was no valid retrenchment.
Respondent NLRC committed grave abuse of discretion in reversing the
findings of the Labor Arbiter and ruling that there was substantial compliance
with the law. This Court firmly holds that measures should be strictly
implemented to ensure that such constitutional mandate on protection to labor
is not rendered meaningless by an erroneous interpretation of applicable laws.
We uphold the monetary award of the Labor Arbiter for: (a) the balance of
the separation pay benefits of petitioners equivalent to fifteen (15) days for
every year of service after finding that reinstatement is no longer feasible under
the circumstances, and (b) the salary differentials for complainants who were
relieved during the pendency of the case before the Labor Arbiter and full back
wages for the rest of the complainants. This is in accord with Art. 279 of the
Labor Code as amended by R.A. 6715 under which petitioners who were
unjustly dismissed from work shall be entitled to full back wages inclusive of
allowances and other benefits or their monetary equivalent computed from the
time their compensation was withheld up to the date of this decision.
WHEREFORE, the Petition is GRANTED. The decision of the Labor Arbiter
of 27 March 1992 granting petitioners their claim for the balance of their
separation pay benefits equivalent to fifteen (15) days for every year of service,
and salary differentials for complainants who were relieved during the pendency
of the case before the Labor Arbiter, and full back wages for the rest of the
complainants is REINSTATED. Consequently, the decision of the National
Labor Relations Commission dated 27 September 1992 is REVERSED and
SET ASIDE.
SO ORDERED.
Padilla, (Chairman), Vitug, Kapunan, and Hermosisima, Jr., JJ., concur.
CASE#2

THIRD DIVISION

[G.R. No. 119243. April 17, 1997]

BREW MASTER INTERNATIONAL INC., petitioner, vs. NATIONAL

FEDERATION OF LABOR UNIONS (NAFLU), ANTONIO D.
ESTRADA and HONORABLE NATIONAL LABOR RELATIONS
COMMISSION (Third Division), respondents.

DECISION
DAVIDE, JR., J.:

This is a special civil action for certiorari seeking the reversal of the 7 October 1994
decision[1] of the National Labor Relations Commission (NLRC) in NLRC Case No. 00-06-
04136-93 (CA No. L-007370-94), which modified the 11 July 1994 decision[2] of the Labor
Arbiter by directing the reinstatement of private respondent Antonio D. Estrada, the
complainant, without loss of seniority rights and benefits.
Private respondent National Federation of Labor Unions (NAFLU), a co-complainant
in the labor case, is a labor union of which complainant is a member.
The factual and procedural antecedents are summarized in the decision of the Labor
Arbiter which we quote verbatim:

Complainant was first employed by respondent on 16 September 1991 as route helper

with the latest daily wage of P119.00. From 19 April 1993 up to 19 May 1993, for a
period of one (1) month, complainant went on absent without permission
(AWOP). On 20 May 1993, respondent thru Mr. Rodolfo Valentin, sent a Memo to
complainant, to wit:

Please explain in writing within 24 hours of your receipt of this memo why no
disciplinary action should be taken against you for the following offense:

You were absent since April 19, 1993 up to May 19, 1993.

For your strict compliance.

In answer to the aforesaid memo, complainant explained:

Sa dahilan po na ako ay hindi nakapagpaalam sainyo [sic] dahil inuwi ko ang mga
anak ko sa Samar dahil ang asawa ko ay lumayas at walang mag-aalaga sa mga anak
ko. Kaya naman hindi ako naka long distance or telegrama dahil wala akong pera at
ibinili ko ng gamot ay puro utang pa.

Finding said explanation unsatisfactory, on 16 June 1993, respondent thru its Sales
Manager, Mr. Henry A. Chongco issued a Notice of Termination which reads:

We received your letter of explanation dated May 21, 1993 but we regret to inform
you that we do not consider it valid. You are aware of the company Rules and
Regulations that absence without permission for six (6) consecutive working days is
considered abandonment of work.
In view of the foregoing, the company has decided to terminate your employment
effective June 17, 1993 for abandonment of work.

Hence, this complaint.

Complainants contend that individual complainants dismissal was done without just
cause; that it was not sufficiently established that individual complainants absence
from April 19, 1993 to June 16, 1993 are unjustified; that the penalty of dismissal for
such violation is too severe; that in imposing such penalty, respondent should have
taken into consideration complainants length of service and as a first offender, a
penalty less punitive will suffice such as suspension for a definite period, (Position
Paper, complainants).

Upon the other hand, respondent contends that individual complainant was dismissed
for cause allowed by the company Rules and Regulations and the Labor Code; that the
act of complainant in absenting from work for one (1) month without official leave is
deleterious to the business of respondent; that it will result to stoppage of production
which will not only destructive to respondents interests but also to the interest of its
employees in general; that the dismissal of complainant from the service is legal,
(Position Paper, respondent). [3]

The Labor Arbiter dismissed the complaint for lack of merit, citing the principle of
managerial control, which recognizes the employers prerogative to prescribe reasonable
rules and regulations to govern the conduct of his employees. The principle allows the
imposition of disciplinary measures which are necessary for the efficiency of both the
employer and the employees. In complainant's case, he persisted in not reporting for work
until 16 June 1993 notwithstanding his receipt of the memorandum requiring him to
explain his absence without approval. The Labor Arbiter, relying on Shoemart, Inc. vs.
NLRC,[4] thus concluded:

Verily, it is crystal clear that individual complainant has indeed abandoned his
work. The filing of the complaint on 25 June 1993 or almost two (2) months from the
date complainant failed to report for work affirms the findings of this Office and
therefore, under the law and jurisprudence which upholds the right of an employer to
discharge an employee who incurs frequent, prolonged and unexplained absences as
being grossly remiss in his duties to the employer and is therefore, dismissed for
cause, (Shoemart, Inc. vs. NLRC, 176 SCRA 385). An employee is deemed to have
abandoned his position or to have resigned from the same, whenever he has been
absent therefrom without previous permission of the employer for three consecutive
days or more. This justification is the obvious harm to employers interest, resulting
from [sic] the non-availability of the workers services, (Supra). (underscoring
supplied)[5]

and ruled that complainants termination from his employment was legal, the same with
just or authorized cause and due process.[6]
Complainant appealed to the NLRC, alleging that the immediate filing of a complaint
for illegal dismissal verily indicated that he never intended to abandon his work, then
cited Policarpio v. Vicente Dy Sun, Jr.,[7] where the NLRC ruled that prolonged absence
does not, by itself, necessarily mean abandonment. Accordingly, there must be a
concurrence of intention and overt acts from which it can be inferred that the employee is
no longer interested in working. Complainant likewise invoked compassion in the
application of sanctions, as dismissal from employment brings untold hardship and
sorrows on the dependents of the wage earners. In his case, a penalty less punitive than
dismissal could have sufficed.
In the assailed decision[8] of 7 October 1994, the NLRC modified the Labor Arbiter's
decision and held that complainants dismissal was invalid for the following reasons:
Complainant-appellants prolonged absences, although unauthorized, may not amount
to gross neglect or abandonment of work to warrant outright termination of
employment. Dismissal is too severe a penalty. For one, the mere fact that
complainant-appellant is a first offender must be considered in his favor. Besides, it is
generally impossible for an employee to anticipate when he would be ill or compelled
to attend to some family problems or emergency like in the case at bar.

Reliance on the ruling enunciated in the cited case of Shoemart Inc. vs. National
Labor Relations, 176 SCRA 385, is quite misplaced because of the obvious
dissimilarities of the attendant circumstances in the said case vis-a-vis those obtaining
in the case at bar. Unlike in the aforecited Shoemart Case, herein complainant-
appellant was not dismissed for unauthorized absences and eventually reinstated
anterior to his second dismissal for the same offense nor was he given a second
chance which he could have ignored.

Otherwise stated, the difference between the two cases greatly lies [in] the fact that
complainant in the Shoemart Case in the language of the Supreme Court was an
inveterate absentee who does not deserve reinstatement compared to herein
complainant-appellant who is a first offender [9]

The NLRC then decreed as follows:

PREMISES CONSIDERED, and [sic] the Decision of the Labor Arbiter, dated 11
July 1994 is hereby MODIFIED, by directing the reinstatement of complainant-
appellant to his former position without loss of seniority rights and other benefits, but
without backwages. The other findings in the appealed decision stand AFFIRMED. [10]

Petitioners motion for the reconsideration[11] was denied by the NLRC in its 7
December 1994 resolution.[12] Petitioner thus filed this special civil action contending
that the NLRC committed grave abuse of discretion in ordering complainant's
reinstatement, which in effect countenances the reinstatement of an employee who is
found guilty of excessive absences without prior approval. It further argued that the NLRC
failed to consider the rationale behind petitioners Rules and Regulations; that it was
deprived of its prerogative to enforce them; and that complainant's reinstatement would
adversely affect its business and send the wrong signals to its employees.
In its comment[13] for public respondent NLRC, the Office of the Solicitor General
maintained that dismissal from employment was too severe a penalty for a first time
offender like complainant. Although he violated petitioners rules and regulations, his
absences were justified: he had to bring his children to Samar, his home province, as his
wife deserted him. While that by itself might not excuse the failure to seek permission, the
Office of the Solicitor General submitted, however, that it would be at [sic] the height of
callousness if one, considering his plight under the circumstance[s], would not give due
consideration to [complainants] explanation. There has to be an exception.[14]
Applying Itogon-Suyoc Mines, Inc. v. NLRC,[15] the Office of the Solicitor General
recommended complainants reinstatement, which would be more harmonious to the
dictates of social justice and equity. It further emphasized that the reinstatement should
not be considered a condonation of complainants irresponsible behavior, rather, it must
be viewed as a mitigation of the severity of the penalty of dismissal. Accordingly, it prays
that this petition be dismissed.
In its reply,[16] petitioner disputed the application of Itogon-Suyoc because: (1) the
employee involved therein had been in the service for twenty-three years while
complainant herein had served petitioner for only two years; and (2) the offense in Itogon-
Suyoc was limited to a single act of high grading while complainant herein committed a
series of unexcused absences.
We gave due course to the petition and dispensed with complainants comment.
The sole issue to be resolved is whether the NLRC committed grave abuse of
discretion in modifying the decision of the Labor Arbiter.
 The answer must be in the negative.
A scrutiny of the facts discloses that complainants absence was precipitated by a
grave family problem as his wife unexpectedly deserted him and abandoned the
family. Considering that he had a full-time job, there was no one to whom he could entrust
the children and he was thus compelled to bring them to the province. It would have been
extremely difficult for him to have been husband and wife/father and mother at the same
time to the children in the metropolis. He was then under emotional, psychological,
spiritual and physical stress and strain. The reason for his absence is, under these
circumstances, justified. While his failure to inform and seek petitioner's approval was an
omission which must be corrected and chastised, he did not merit the severest penalty of
dismissal from the service.
Petitioners finding that complainant was guilty of abandonment is misplaced.
Abandonment as a just and valid ground for dismissal requires the deliberate, unjustified
refusal of the employee to resume his employment. Two elements must then be satisfied:
(1) the failure to report for work or absence without valid or justifiable reason; and (2) a
clear intention to sever the employer-employee relationship. The second element is the
more determinative factor and must be evinced by overt acts.[17] Likewise, the burden of
proof is on the employer to show the employees clear and deliberate intent to discontinue
his employment without any intention of returning,[18] mere absence is not
sufficient.[19] These elements are not present here. First, as held above, complainant's
absence was justified under the circumstances. As to the second requisite, we are not
convinced that complainant ever intended to sever the employer-employee
relationship. Complainant immediately complied with the memo requiring him to explain
his absence, and upon knowledge of his termination, immediately sued for illegal
dismissal. These plainly refuted any claim that he was no longer interested in returning to
work.[20] Without doubt, the intention is lacking.
Moreover, petitioner failed to discharge the burden of proof that complainant was
guilty of abandonment. No evidence other than complainants letter explaining his
absence was presented. Needless to state, the letter did not indicate, in the least, that
complainant was no longer interested in returning to work. On the contrary, complainant
sought petitioners understanding. In declaring him guilty of abandonment, petitioner
merely relied on its Rules and Regulations which limited its application to a six-day
continuous absence, contrary to the purpose of the law. While the employer is not
precluded from prescribing rules and regulations to govern the conduct of his employees,
these rules and their implementation must be fair, just and reasonable. It must be
underscored that no less than our Constitution looks with compassion on the workingman
and protects his rights not only under a general statement of a state policy,[21] but under
the Article on Social Justice and Human Rights,[22] thus placing labor contracts on a higher
plane and with greater safeguards. Verily, relations between capital and labor are not
merely contractual. They are impressed with public interest and labor contracts must,
perforce, yield to the common good.[23]
We then conclude that complainants "prolonged" absence without approval does not
fall within the definition of abandonment and that his dismissal was unjustified. While we
do not decide here the validity of petitioner's Rules and Regulations on continuous,
unauthorized absences, what is plain is that it was wielded with undue haste resulting in
a deprivation of due process, thus not allowing for a determination of just cause or
abandonment. In this light, petitioner's dismissal was illegal. This is not to say that his
absence should go unpunished, as impliedly noted by the NLRC in declining to award
back wages. In the absence of the appropriate offense which defines complainants
infraction in the companys Rules and Regulations, equity dictates that a penalty
commensurate to the infraction be imposed.
WHEREFORE, the petition is hereby DISMISSED and the decision of the National
Labor Relations Commission in NLRC Case No. 06-04136-93 is hereby AFFIRMED. No
pronouncement as to costs.
SO ORDERED.
Narvasa, C.J., (Chairman), Melo, Francisco, and Panganiban, JJ., concur.
CASE#3
FIRST DIVISION

[G.R. No. 128845. June 1, 2000]

INTERNATIONAL SCHOOL ALLIANCE OF EDUCATORS

(ISAE), petitioner, vs. HON. LEONARDO A. QUISUMBING in his capacity
as the Secretary of Labor and Employment; HON. CRESENCIANO B.
TRAJANO in his capacity as the Acting Secretary of Labor and
Employment; DR. BRIAN MACCAULEY in his capacity as the
Superintendent of International School-Manila; and INTERNATIONAL
SCHOOL, INC., respondents.

DECISION

KAPUNAN, J.:

Receiving salaries less than their counterparts hired abroad, the local-hires of private
respondent School, mostly Filipinos, cry discrimination. We agree. That the local-hires
are paid more than their colleagues in other schools is, of course, beside the point. The
point is that employees should be given equal pay for work of equal value. That is a
principle long honored in this jurisdiction. That is a principle that rests on fundamental
notions of justice. That is the principle we uphold today.

Private respondent International School, Inc. (the School, for short), pursuant to
Presidential Decree 732, is a domestic educational institution established primarily for
dependents of foreign diplomatic personnel and other temporary residents.[1] To enable
the School to continue carrying out its educational program and improve its standard of
instruction, Section 2(c) of the same decree authorizes the School to

employ its own teaching and management personnel selected by it either

locally or abroad, from Philippine or other nationalities, such personnel
being exempt from otherwise applicable laws and regulations attending
their employment, except laws that have been or will be enacted for the
protection of employees.

Accordingly, the School hires both foreign and local teachers as members of its faculty,
classifying the same into two: (1) foreign-hires and (2) local-hires. The School employs
four tests to determine whether a faculty member should be classified as a foreign-hire
or a local hire:

a.....What is one's domicile?

b.....Where is one's home economy?

c.....To which country does one owe economic allegiance?

d.....Was the individual hired abroad specifically to work in the School and
was the School responsible for bringing that individual to the Philippines?[2]

Should the answer to any of these queries point to the Philippines, the faculty member
is classified as a local hire; otherwise, he or she is deemed a foreign-hire.

The School grants foreign-hires certain benefits not accorded local-hires. These include
housing, transportation, shipping costs, taxes, and home leave travel allowance.
Foreign-hires are also paid a salary rate twenty-five percent (25%) more than local-
hires. The School justifies the difference on two "significant economic disadvantages"
foreign-hires have to endure, namely: (a) the "dislocation factor" and (b) limited tenure.
The School explains:
 A foreign-hire would necessarily have to uproot himself from his home
country, leave his family and friends, and take the risk of deviating from a
promising career path-all for the purpose of pursuing his profession as an
educator, but this time in a foreign land. The new foreign hire is faced with
economic realities: decent abode for oneself and/or for one's family,
effective means of transportation, allowance for the education of one's
children, adequate insurance against illness and death, and of course the
primary benefit of a basic salary/retirement compensation.

Because of a limited tenure, the foreign hire is confronted again with the
same economic reality after his term: that he will eventually and inevitably
return to his home country where he will have to confront the uncertainty
of obtaining suitable employment after a long period in a foreign land.

The compensation scheme is simply the School's adaptive measure to

remain competitive on an international level in terms of attracting
competent professionals in the field of international education. [3]

When negotiations for a new collective bargaining agreement were held on June 1995,
petitioner International School Alliance of Educators, "a legitimate labor union and the
collective bargaining representative of all faculty members"[4] of the School, contested
the difference in salary rates between foreign and local-hires. This issue, as well as the
question of whether foreign-hires should be included in the appropriate bargaining unit,
eventually caused a deadlock between the parties.

On September 7, 1995, petitioner filed a notice of strike. The failure of the National
Conciliation and Mediation Board to bring the parties to a compromise prompted the
Department of Labor and Employment (DOLE) to assume jurisdiction over the dispute.
On June 10, 1996, the DOLE Acting Secretary, Crescenciano B. Trajano, issued an
Order resolving the parity and representation issues in favor of the School. Then DOLE
Secretary Leonardo A. Quisumbing subsequently denied petitioner's motion for
reconsideration in an Order dated March 19, 1997. Petitioner now seeks relief in this
Court.

Petitioner claims that the point-of-hire classification employed by the School is

discriminatory to Filipinos and that the grant of higher salaries to foreign-hires
constitutes racial discrimination.

The School disputes these claims and gives a breakdown of its faculty members,
numbering 38 in all, with nationalities other than Filipino, who have been hired locally
and classified as local hires.[5]The Acting Secretary of Labor found that these non-
Filipino local-hires received the same benefits as the Filipino local-hires:

The compensation package given to local-hires has been shown to apply to all,
regardless of race. Truth to tell, there are foreigners who have been hired locally and
who are paid equally as Filipino local hires.[6]

The Acting Secretary upheld the point-of-hire classification for the distinction in salary
rates:

The principle "equal pay for equal work" does not find application in the
present case. The international character of the School requires the hiring
of foreign personnel to deal with different nationalities and different
cultures, among the student population.

We also take cognizance of the existence of a system of salaries and

benefits accorded to foreign hired personnel which system is universally
recognized. We agree that certain amenities have to be provided to these
people in order to entice them to render their services in the Philippines
and in the process remain competitive in the international market.
 Furthermore, we took note of the fact that foreign hires have limited
contract of employment unlike the local hires who enjoy security of tenure.
To apply parity therefore, in wages and other benefits would also require
parity in other terms and conditions of employment which include the
employment contract.

A perusal of the parties' 1992-1995 CBA points us to the conditions and

provisions for salary and professional compensation wherein the parties
agree as follows:

All members of the bargaining unit shall be compensated

only in accordance with Appendix C hereof provided that the
Superintendent of the School has the discretion to recruit
and hire expatriate teachers from abroad, under terms and
conditions that are consistent with accepted international
practice.

Appendix C of said CBA further provides:

The new salary schedule is deemed at equity with the

Overseas Recruited Staff (OSRS) salary schedule. The 25%
differential is reflective of the agreed value of system
displacement and contracted status of the OSRS as
differentiated from the tenured status of Locally Recruited
Staff (LRS).

To our mind, these provisions demonstrate the parties' recognition of the

difference in the status of two types of employees, hence, the difference in
their salaries.

The Union cannot also invoke the equal protection clause to justify its
claim of parity. It is an established principle of constitutional law that the
guarantee of equal protection of the laws is not violated by legislation or
private covenants based on reasonable classification. A classification is
reasonable if it is based on substantial distinctions and apply to all
members of the same class. Verily, there is a substantial distinction
between foreign hires and local hires, the former enjoying only a limited
tenure, having no amenities of their own in the Philippines and have to be
given a good compensation package in order to attract them to join the
teaching faculty of the School.[7]

We cannot agree.

That public policy abhors inequality and discrimination is beyond contention. Our
Constitution and laws reflect the policy against these evils. The Constitution[8] in the
Article on Social Justice and Human Rights exhorts Congress to "give highest priority to
the enactment of measures that protect and enhance the right of all people to human
dignity, reduce social, economic, and political inequalities." The very broad Article 19 of
the Civil Code requires every person, "in the exercise of his rights and in the
performance of his duties, [to] act with justice, give everyone his due, and observe
honesty and good faith."

International law, which springs from general principles of law,[9] likewise proscribes
discrimination. General principles of law include principles of equity,[10] i.e., the general
principles of fairness and justice, based on the test of what is reasonable.[11] The
Universal Declaration of Human Rights,[12] the International Covenant on Economic,
Social, and Cultural Rights,[13] the International Convention on the Elimination of All
Forms of Racial Discrimination,[14] the Convention against Discrimination in
Education,[15] the Convention (No. 111) Concerning Discrimination in Respect of
Employment and Occupation[16] - all embody the general principle against discrimination,
the very antithesis of fairness and justice. The Philippines, through its Constitution, has
incorporated this principle as part of its national laws.
In the workplace, where the relations between capital and labor are often skewed in
favor of capital, inequality and discrimination by the employer are all the more
reprehensible.

The Constitution[17] specifically provides that labor is entitled to "humane conditions of

work." These conditions are not restricted to the physical workplace - the factory, the
office or the field - but include as well the manner by which employers treat their
employees.

The Constitution[18] also directs the State to promote "equality of employment

opportunities for all." Similarly, the Labor Code[19] provides that the State shall "ensure
equal work opportunities regardless of sex, race or creed." It would be an affront to both
the spirit and letter of these provisions if the State, in spite of its primordial obligation to
promote and ensure equal employment opportunities, closes its eyes to unequal and
discriminatory terms and conditions of employment.[20]

Discrimination, particularly in terms of wages, is frowned upon by the Labor Code.

Article 135, for example, prohibits and penalizes[21] the payment of lesser compensation
to a female employee as against a male employee for work of equal value. Article 248
declares it an unfair labor practice for an employer to discriminate in regard to wages in
order to encourage or discourage membership in any labor organization.

Notably, the International Covenant on Economic, Social, and Cultural Rights, supra, in
Article 7 thereof, provides:

The States Parties to the present Covenant recognize the right of

everyone to the enjoyment of just and favourable conditions of work,
which ensure, in particular:

a.....Remuneration which provides all workers, as a minimum, with:

i.....Fair wages and equal remuneration for work of equal

value without distinction of any kind, in particular women
being guaranteed conditions of work not inferior to those
enjoyed by men, with equal pay for equal work;

x x x.

The foregoing provisions impregnably institutionalize in this jurisdiction the long honored
legal truism of "equal pay for equal work." Persons who work with substantially equal
qualifications, skill, effort and responsibility, under similar conditions, should be paid
similar salaries.[22] This rule applies to the School, its "international character"
notwithstanding.

The School contends that petitioner has not adduced evidence that local-hires perform
work equal to that of foreign-hires.[23] The Court finds this argument a little cavalier. If an
employer accords employees the same position and rank, the presumption is that these
employees perform equal work. This presumption is borne by logic and human
experience. If the employer pays one employee less than the rest, it is not for that
employee to explain why he receives less or why the others receive more. That would
be adding insult to injury. The employer has discriminated against that employee; it is
for the employer to explain why the employee is treated unfairly.

The employer in this case has failed to discharge this burden. There is no evidence
here that foreign-hires perform 25% more efficiently or effectively than the local-hires.
Both groups have similar functions and responsibilities, which they perform under
similar working conditions.

The School cannot invoke the need to entice foreign-hires to leave their domicile to
rationalize the distinction in salary rates without violating the principle of equal work for
equal pay.
"Salary" is defined in Black's Law Dictionary (5th ed.) as "a reward or recompense for
services performed." Similarly, the Philippine Legal Encyclopedia states that "salary" is
the "[c]onsideration paid at regular intervals for the rendering of services." In Songco
v. National Labor Relations Commission,[24] we said that:

"salary" means a recompense or consideration made to a person for his

pains or industry in another man's business. Whether it be derived from
"salarium," or more fancifully from "sal," the pay of the Roman soldier, it
carries with it the fundamental idea of compensation for services
rendered. (Emphasis supplied.)

While we recognize the need of the School to attract foreign-hires, salaries should not
be used as an enticement to the prejudice of local-hires. The local-hires perform the
same services as foreign-hires and they ought to be paid the same salaries as the
latter. For the same reason, the "dislocation factor" and the foreign-hires' limited tenure
also cannot serve as valid bases for the distinction in salary rates. The dislocation factor
and limited tenure affecting foreign-hires are adequately compensated by certain
benefits accorded them which are not enjoyed by local-hires, such as housing,
transportation, shipping costs, taxes and home leave travel allowances.

The Constitution enjoins the State to "protect the rights of workers and promote their
welfare,"[25] "to afford labor full protection."[26] The State, therefore, has the right and duty
to regulate the relations between labor and capital.[27] These relations are not merely
contractual but are so impressed with public interest that labor contracts, collective
bargaining agreements included, must yield to the common good.[28] Should such
contracts contain stipulations that are contrary to public policy, courts will not hesitate to
strike down these stipulations.

In this case, we find the point-of-hire classification employed by respondent School to

justify the distinction in the salary rates of foreign-hires and local hires to be an invalid
classification. There is no reasonable distinction between the services rendered by
foreign-hires and local-hires. The practice of the School of according higher salaries to
foreign-hires contravenes public policy and, certainly, does not deserve the sympathy of
this Court.

We agree, however, that foreign-hires do not belong to the same bargaining unit as the
local-hires.

A bargaining unit is "a group of employees of a given employer, comprised of all or less
than all of the entire body of employees, consistent with equity to the employer indicate
to be the best suited to serve the reciprocal rights and duties of the parties under the
collective bargaining provisions of the law."[29] The factors in determining the appropriate
collective bargaining unit are (1) the will of the employees (Globe Doctrine); (2) affinity
and unity of the employees' interest, such as substantial similarity of work and duties, or
similarity of compensation and working conditions (Substantial Mutual Interests Rule);
(3) prior collective bargaining history; and (4) similarity of employment status.[30] The
basic test of an asserted bargaining unit's acceptability is whether or not it is
fundamentally the combination which will best assure to all employees the exercise of
their collective bargaining rights.[31]

It does not appear that foreign-hires have indicated their intention to be grouped
together with local-hires for purposes of collective bargaining. The collective bargaining
history in the School also shows that these groups were always treated separately.
Foreign-hires have limited tenure; local-hires enjoy security of tenure. Although foreign-
hires perform similar functions under the same working conditions as the local-hires,
foreign-hires are accorded certain benefits not granted to local-hires. These benefits,
such as housing, transportation, shipping costs, taxes, and home leave travel
allowance, are reasonably related to their status as foreign-hires, and justify the
exclusion of the former from the latter. To include foreign-hires in a bargaining unit with
local-hires would not assure either group the exercise of their respective collective
bargaining rights.
WHEREFORE, the petition is GIVEN DUE COURSE. The petition is hereby GRANTED
IN PART. The Orders of the Secretary of Labor and Employment dated June 10, 1996
and March 19, 1997, are hereby REVERSED and SET ASIDE insofar as they uphold
the practice of respondent School of according foreign-hires higher salaries than local-
hires.

SO ORDERED.

Puno, and Pardo, JJ., concur.

Davide, Jr., C.J., (Chairman), on official leave.

Ynares-Santiago, J., on leave.

CASE#4
FIRST DIVISION

[G.R. No. 112630. September 5, 1997]

CORAZON JAMER and CRISTINA AMORTIZADO, petitioners,

vs. NATIONAL LABOR RELATIONS COMMISSION, ISETANN
DEPARTMENT STORE and/or JOHN GO, respondents.

DECISION
HERMOSISIMA, JR., J.:

The decision of public respondent National Labor Relations Commission

[1]

(NLRC) in NLRC NCR CA 002074-91, promulgated on November 12 1993, is

[2] [3]

herein sought to be annulled for having been rendered with grave abuse of
discretion, it having reversed and set aside the decision of Labor Arbiter Pablo
[4]

C. Espiritu, Jr. by dismissing the petitioners complaint for illegal dismissal

against private respondent Isetann Department Store (Isetann, for brevity). The
decretal part of the NLRC decision reads:

WHEREFORE, premises considered, the appealed decision is hereby set aside and
new one promulgated declaring that the dismissal from the service of complainants
Corazon Jamer and Cristina Amortizado was valid and for cause. Consequently, the
order of reinstatement with backwages and attorneys fees are likewise vacated and set
aside.
[5]

Although the Labor Arbiter and the NLRC reached contrary conclusions,
[6]

both agree on the following facts:

Complainant, Corazon Jamer was employed on February 10, 1976 as a Cashier at Joy
Mart, a sister company of Isetann. After two (2) years, she was later on promoted to
the position of counter supervisor. She was transferred to Isetann, Carriedo Branch, as
a money changer. In 1982 she was transferred to the Cubao Branch of Isetann, as a
money changer, till her dismissal on August 31, 1990.

Complainant Cristina Amortizado, on the other hand, was employed also at Joy Mart
in May, 1977 as a sales clerk. In 1980 she was promoted to the position as counter
cashier. Thereafter, she was transferred to Young Un Department Store as an assistant
to the money changer. Later on, or in 1985, she transferred to Isetann, Cubao Branch
where she worked as a Store Cashier till her dismissal on August 31, 1990.

Both complainants were receiving a salary of P4,182.00 for eight (8) hours work at
the time of their dismissal.

Respondent Isetann Department Store on the other hand, is a corporation duly

organized and existing under laws of the Philippines and is engaged in retail trade and
the department store business. Individual respondent, John Go is the
President/General (Manager) of respondent Department Store.

This complaint arose from the dismissal of the complainants by the respondents. They
were both dismissed on August 31, 1990 on the alleged ground of dishonesty in their
work as Store Cashiers.
Complainants (sic) function as Store Cashiers is to accumulate, at the end of daily
operations, the cash sales receipts of the selling floor cash register clerks. At the close
of business hours, all the cash sales of the floor cash register clerks are turned over by
them to the Store Cashiers, complainants herein, together with the tally sheets
prepared by the cash register clerks. Thereafter, complainants will reconcile the cash
sales with the tally sheets to determine shortages or coverages(sic) and deposit the
same with the bank depositor(sic) of respondents company. Thereafter, the recorded
transactions are forwarded to the main branch of respondents company at Carriedo for
counter-checking.

On July 16, 1990, complainants discovered a shortage of P15,353.78. It was

complainant Corazon Jamer who first discovered the shortage. In fact at first, she
thought that it was merely a P1,000.00 shortage but when she reconciled the cash
receipts, from the cash register counters, with the tally sheets and the actual money on
hand, the shortage amounted to P15,353.78. She informed her co-store cashier,
complainant Cristina Amortizado, about the shortage. Cristina Amortizado also
reconciled and re-counted the sale previous to July 16, 1990 and she also confirmed
that there was a discrepancy or a shortage of P15,353.78.. They did not, (sic)
immediately report the shortage to management hoping to find the cause of the
shortage but to no avail they failed to reconcile the same. Hence, they had no other
alternative but to report the same to the management on July 17, 1990.

Complainants, together with another Store Cashier, Lutgarda Inducta, were asked to
explain and they submitted their respective written explanations for the shortage
of P15,353.78. and the P450.00 under deposit last July 14, 1990.

Respondents placed both complainants and their co-store cashier Lutgarda Inducta
under preventive suspension for the alleged shortages. Thereafter, respondents
conducted an administrative investigation. Finding the explanation of the
complainants to be unsatisfactory, respondent dismissed the complainants from the
service on August 31, 1990. Aggrieved and not satisfied with the decision of
management terminating their services, complainant instituted this present action on
September 26, 1990 for illegal dismissal praying for reinstatement with payment of
backwages and other benefits. [7]

In justifying complainants dismissal from their employment, respondents alleged:

When the transactions for July 15, 1990 were being reconciled, a shortage
of P15,353.78 was discovered. Also uncovered was an under-deposit of P450.00 of
cash receipts for July 14, 1990.

Considering that the foregoing deficits were attributable to herein appellees and to
another store cashier, Mrs. Lutgarda Inducta, who were the ones on duty those days
respondent Isetanns Human Resources Division Manager, Teresita A. Villanueva,
issued letters (Exh. 1 and 5) individually addressed to herein appellees and Mrs.
Inducta requiring them to submit written explanations in regard to their above
malfeasance within 48 hours from receipt thereof. Pursuant to said letters, they were
likewise placed under preventive suspension.

Thereafter, the Committee o Discipline of appellant Isetann conducted a series of

investigations probing appellees and Mrs. Inductas aforestated shortages. In addition
to the shortage of P15,353.78(sic) and underdeposit of P450.00, said investigation
also included the following sums which appellees failed to turnover or account for:

a) P1,000.00- amount borrowed by Lutgarda Inducta from Corazon Jamer;

b) P 70.00- over replenishment of petty cash expenses incurred by Cristina
Amortizado.

After the administrative investigation, the Committee on Discipline rendered its

decision (Exhs. 3, 3-A, to 3-D) dated August 23, 1990 duly approved by the General
Manager of respondent Isetann, finding the appellees and Mrs. Inducta responsible for
said shortages and consequently requiring them to restitute the same to respondent
Isetann. This Decision and the notices of termination were sent by respondent Isetann
to the appellees, and which the latter admittedly received.

On the other hand, the complainants account of the factual antecedents that let (sic) to
their dismissal is as follows:

Aside from the foregoing persons, Alex Mejia had and was allowed by management
to have uncontrolled access to the said room including the vault. Ostensibly, the
purpose was to assist in the bringing in or taking out of coin bags, monies, etc.

There were therefore, at a minimum at least six (6) persons who could have had
access to the company funds. To ascribe liability to the store cashiers alone, in the
absence of a clear proof of any wrongdoing is not only unfair and discriminatory but
is likewise illegal.

Parenthetically, and within the parameters of their assigned tasks, herein complainants
could not be faulted in any way for the said shortage as there is no showing that the
loss occurred at the time they were in control of the funds concerned.

Complainants do not dispute the fact that there appeared to be a shortage

of P15.373.78(sic) for the July 15, 1990 (a Sunday) sales and which were tallied and
the loss discovered on the following day, July 16, 1990. They however vehemently
deny any culpability or participation in any kind, directly or indirectly, in regard to the
said loss or shortage. Given the kind of trust reposed upon them by respondents for
fourteen and thirteen years respectively they were not about, although they could have
done so before given the negligence and laxity of management in regard to the control
and handling of funds of the store, to break said trust.

At the time the persons who had access either to the vault the money and/or the keys
aside from herein complainants, were: 1) Lutgarda Inducta, also a store cashier on
duty at the time; 2) the SOM Mrs. Samonte, the supervisor in charge; 3) Alex Mejia,
an employee assigned as utility man; and 4) Boy Cabatuando.

There were (sic) three (3) keys to the money changers room, and these keys were
assigned and distributed to: a) master key is or was with the SOMs (Mrs. Samonte)
room at the 3 floor of the building; b) another key is or was in the possession of the
rd

keeper of the keys, i.e. Boy Cabatuando; and c) the third and last key is any of the
store cashiers depending on who is on duty at the time.

Likewise, there were four (4) persons who were aware and knew of the vault
combination. These were the three store cashiers, i.e. herein complainants, Lutgarda
Inducta and their SOM, Mrs. Samonte. [8]

On July 23, 1991, Labor Arbiter Nieves V. de Castro, to whom the instant
contoversy was originally assigned, rendered a decision in favor of herein
[9]

petitioners, finding that petitioners had been illegally dismissed, the dispositive
portion of which reads:
WHEREFORE, respondents are hereby directed to reinstate complainants to service
effective August 1, 1991 with full backwages and without loss of seniority rights.

SO ORDERED. [10]

Expectedly, respondents Isetann and John Go appealed the aforesaid

decision to the NLRC. On January 31, 1992, the NLRC issued a
resolution remanding this case to the NLRC National Capital Region
[11]

Arbitrattion Branch for further proceedings in the following manner:

WHEREFORE, premises considered, the challenged decision is hereby SET ASIDE

and VACATED.

The entire records of this case is hereby remanded to the NLRC National Capital
Region Arbitration Branch for further proceedings.

Considering that the Labor Arbiter a quo rendered a decision in this case and in order
to dispel any suspicion of pre-judgment of this case, the Executive Labor Arbiter is
hereby directed to have this case re-raffled to another Labor Arbiter.

SO ORDERED. [12]

Consequently, the present case was then re-raffled to Labor Arbiter Pablo
C. Espiritu, Jr. After a full-blown trial, the said Labor Arbiter found for the
petitioners and declared that there was no justification, whether in fact or in law,
for their dismissal. The decretal part of the decision dated March 31, 1993,
[13]

states:

WHEREFORE, above premises considered, judgement(sic) is hereby rendered finding

the dismissal of complainants, Cristina Amortizado and Corazon Jamer to be illegal
and concomitantly, (r)espondents are hereby ordered to pay complainants, Corazon
Jamer the amount of P125,460.00 and Cristina Amortizado the
amount of P125,460.00, representing full backwages from the time of their dismissal
(August 31, 1990) till actual or payroll reinstatement at the option of the respondent
(computed until promulgation only). Respondents are also hereby further ordered to
reinstate the complainants to their former position as Store Cashiers without loss of
seniority rights, privileges and benefits, failure to do so backwages shall continue to
run but in no case to exceed three (3) years.

Respondents are also ordered to pay complainants the amount of P25,092.00

representing 10% attorneys fees based in the total judgement(sic) award
of P250,920.00.

SO ORDERED. [14]

Dissatisfied over the decision of the Labor Arbiter which struck private
respondents as grossly contrary to the evidence presented, the herein private
respondents once again appealed to the NLRC. And, as earlier stated, the
NLRC rendered the challenged decision on November 12, 1993, vacating the
[15]

decision of the Labor Arbiter and entering a new one dismissing the petitioners
complaint.
Hence, this petition wherein the main issue to be resolved is whether NLRC
committed grave abuse of discretion in finding that petitioners were validly
dismissed on the ground of loss of trust and confidence.
 At the outset, the Court notes petitioners inexcusable failure to move for the
reconsideration of respondent NLRCs decision. Thus, the present petition
suffers from a procedural defect that warrants its outright dismissal. While in
some exceptional cases we allowed the immediate recourse to this Court, we
find nothing herein that could warrant an exceptional treatment to this petition
which will justify the omission. This premature action of petitioners constitutes
a fatal infirmity as ruled in a long line of decisions, most recently in the case
[16]

of Building Care Corporation vs. National Labor Relations Commission, et al.: [17]

the filing of such a motion is intended to afford public respondent an opportunity to

correct any actual or fancied error attributed to it by way of a re-examination of the
legal and factual aspects of the case. Petitioners inaction or negligence under the
circumstances is tantamount to a deprivation of the right and opportunity of the
respondent Commission to cleanse itself of an error unwittingly committed or to
vindicate itself of an act unfairly imputed. xxx

xxx And for failure to avail of the correct remedy expressly provided by law,
petitioner has permitted the subject Resolution to become final and executory after the
lapse of the ten day period within which to file such motion for reconsideration.

Likewise, a motion for reconsideration is an adequate remedy;

hence certiorari proceedings,as in this case, will not prosper. Rule 65, Section
[18]

1 of the Rules of Civil Procedure, as amended, clearly provides that:

When any tribunal, board or officer exercising judicial or quasi-judicial functions has
acted without or in excess of its or his jurisdiction, or with grave abuse of discretion
amounting to lack or excess of jurisdiction, and there is no appeal, or any plain,
speedy, and adequate remedy in the ordinary course of law, a person aggrieved
thereby may file a verified petition in the proper court, alleging the facts with
certainty and praying that judgment be rendered annulling or modifying the
proceedings of such tribunal, board or officer, xxx

The unquestioned rule in this jurisdiction is that certiorari will lie only if there
is no appeal or any other plain, speedy and adequate remedy in the ordinary
course of law against the acts of respondent. In the case at bench, the plain
[19]

and adequate remedy referred to in Rule 65, Section 1, is a motion for

reconsideration of the challenged decision and the resolution thereof, which
was expected to provide an adequate and a more speedy remedy than the
present petition for certiorari.
Petitioners asseverate that respondent NLRC committed a grave abuse of
discretion when it reversed the findings of facts of the Labor Arbiter.
We find said submissions untenable.
In asserting that there was a grave abuse of discretion, petitioners advert to
alleged variances in the factual findings of the Labor Arbiter and the respondent
NLRC. This is inept and erroneous. Firstly, errors of judgment, as distinguished
from errors of jurisdiction, are not within the province of a special civil action
for certiorari. Secondly, a careful reading of the records of this case would
[20]

readily show that there is any error by public respondent in its analysis of the
facts and its evaluation of the evidence, it is not of such a degree as may be
stigmatized as a grave abuse of discretion does not necessarily follow just
because there is a reversal by the NLRC of the decision of the Labor Arbiter.
Neither does the mere variance in the evidentiary assessment of the NLRC and
that of the Labor Arbiter would, as a matter of course, so warrant another full
review of the facts. The NLRCs decision, so long as it is not bereft of support
from the records, deserves respect from the Court. [21]

We must once more reiterate our much repeated but not well-heeded rule
that the special civil action for certiorari is a remedy designed for the correction
of errors of jurisdiction and not errors of judgment. The rationale for this rule is
simple. When a court exercises its jurisdiction being exercised when the error
is committed. If it did, every error committed by a court would deprive it of its
jurisdiction and every erroneous judgment would be a void judgment. This
cannot be allowed. The administration of justice would not countenance such a
rule. Consequently, an error of judgment that the court may commit in the
exercise of its jurisdiction is not correctible through the original special civil
action of certiorari.[22]

On the merits, we find and so hold that substantial evidence exists to

warrant the finding that petitioners were validly dismissed for just cause and
after observance of due process.
Under the Labor Code, as amended, the requirements for the lawful
dismissal of an employee by his employer are two-fold: the substantive and the
procedural. Not only must the dismissal be for a valid or authorized cause as
provided by law (Articles 282, 283 and 284, of the Labor Code, as amended),
but the rudimentary requirements of due process, basic of which are the
opportunity to be heard and to defend himself, must be observed before an
employee may be dismissed. [23]

With respect to the first requisite, Article 282 of the Labor Code, as
amended, provides:

ART. 282. Termination by Employer.- An employer may terminate an employment

for any of the following causes:

(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
representative; and

(e) Other causes analogous to the foregoing. (Italics supplied)

In the instant case, we find no difficulty in agreeing with the findings of the
public respondent that the herein petitioners were guilty of acts of dishonesty
by incurring several occurrences of shortages in the amounts
of P15,353.78, P1,000.00, P450.00 and P70.00 which they failed to turnover
and account for/and in behalf of respondent Isetann. Fittingly, the findings of
the NLRC are worth stressing at this point, to wit:

With regard to the several occurrences of shortages of the amounts

of P15,353.78, P1,000.00, P450.00 and P70.00 , the Labor Arbiter has failed to
consider the fact that complainants-appellees were accorded the chance to explain
their side as to the shortages and that they have utterly failed to do so providing basis
for their valid dismissal. This fact has been established by the respondents-appellants
in the findings of the Committee on Discipline on Exhibits 3, 3-A to 3-D, as follows:

a) On the Shortage of P15,353.78:

The 3 respondents, Lutgarda Inducta, Cristy Amortizado and Corazon Jamer denied
any involvement in the loss of P15,353.78. Although the money, is under their
responsibility, not one of them gave any explanation about the shortage or loss.

b) On the amount of P1,000.00 borrowed by Inducta from Jamer:

On July 18, 1990, Lutgarda Inducta borrowed money from respondents (sic) Jamer
amounting to P1,000.00 to cover her shortage.

Ms. Jamer said that Ms. Inducta paid the amount on that day. But Ms. Jamer did not
report the shortage.

c) On the Underdeposit of Cash = P450.00.

The computation of Ms. Amortizado s sales collections last July 14, 1990 resulted to
an overage of P350.00. Amortizado turned over the amount of P350.00, to cover up a
shortage incurred by her and Mrs. Inducta.

Jamer used the money given to her by Amortizado (P350.00), and borrowed
(P150.00) from the change fund to cover the total shortage amounting to P500.00
which she had then.

Jamer cannot trace how the shortage came about. Inducta and Jamer shouldered the
total shortage amounting to P500.00, P330.00 for Jamer and P200.00 for Inducta.
Jamer claimed that she returned the P350.00 in the box. However, the claim of
respondent was further verified from the payroll section which revealed that
a value slip was issued last July 1990. Jamer and Inducta were charged for P200.00
each. A value slip was issued last August 10, 1990 charging P100.00 to Amortizado.

Jamer admitted that she failed to inform the Audit Staff regarding the P350.00
overage which she received from Amortizado. A(s) per report of Ms. Agnes Gonzales
dated 26 July 1990, there was a total under deposit of cash amounting to P450.00.

Total cash admitted P65,428.05

(cash in drawer)

Total cash remitted P64,978.05

(per tally sheet) _________

Overage P 450.00

d) On the P70.00 Replenishment of Petty Cash Expenses:

During the 3 Administrative hearing, the Committee informed Ms. Amortizado

rd

regarding the over replenishment of petty cash expenses as revealed by the Finance
Manager last August 10, 1990.

Mrs. Amortizado readily admitted and explained that she forgot to inform Mrs.
Inducta regarding the P70.00. She admitted her failure to correct the amount
from P100.00 to P30.00 (total expenses spent for the taxi fair).
She added that she previously incurred a shortage amounting to P100.00. Then she
used the P70.00 to cover for the shortage. The remaining balance of P30.00 was paid
by Amortizado.

Amortizado informed the Committee that she is willing to refund the P70.00 shortage.
(Underscoring supplied). [24]

From the foregoing premises, it is crystal clear that the failure of petitioners
to report the aforequoted shortages and overages to management as soon as
they arose resulted in the breach of the fiduciary trust reposed in them by
respondent company, thereby causing the latter to lose confidence in them.
This warrants their dismissal. Moreover, it must be pointed out that herein
petitioners have in fact admitted the underpayment of P450.00 not only in their
Sinumpaang Salaysay but also during the hearing conducted before Labor
Arbiter Pablo C. Espiritu. And, the record shows that the petitioners in fact
[25]

made a last ditch effort to conceal the same. Were it not for its timely discovery
by private respondents trusted employees, the incident could not have been
discovered at all. Furthermore, it is worth stressing at this juncture that the
petitioners have also expressly admitted the shortage of P15,353.78a
substantial amountin their respective sworn statements, and they were not able
to satisfactorily explain such shortage. The Court is convinced that these
[26]

particular acts or omissions provided Isetann with enough basis to forfeit its
trust and confidence over herein petitioners.
The NLRC, therefore, did not act with grave abuse of discretion in declaring
that petitioners were legally dismissed from employment. The failure of
petitioners to report to management the aforementioned irregularities constitute
fraud or willful breach of the trust reposed in them by their employer or duly
authorized representative one of the just causes in terminating employment as
provided for by paragraph (c), Article 282 of the Labor Code, as amended.
In other words, petitioners admissions in their sworn statements, together
with the other documentary evidences on record, constituted breach of trust on
their part which justifies their dismissal. Private respondents Isetann
Department Store and Mr. John Go cannot be compelled to retain employees
who are clearly guilty of malfeasance as their continued employment will be
prejudicial to the formers best interest. The law, I protecting the rights of the
[27]

employees, authorizes neither oppression nor self-destruction of the

employer. [28]

The cause of social justice is not served by upholding the interest of

petitioners in disregard of the right of private respondents. Social justice ceases
to be an effective instrument for the equalization of the social and economic
forces by the State when it is used to shield wrongdoing. While it is true that
[29]

compassion and human consideration should guide the disposition of cases

involving termination of employment since it affects ones source or means of
livelihood, it should not be overlooked that the benefits accorded to labor do not
include compelling an employer to retain the services of an employee who has
been shown to be a gross liability to the employer. It should be made clear that
when the law tilts the scale of justice in favor of labor, it is but a recognition of
the inherent economic inequality between labor and management. The intent is
to balance the scale of justice; to put up the two parties on relatively equal
positions. There may be cases where the circumstances warrant favoring labor
over the interests of management but never should the scale be so tilted if the
result is an injustice to the employer, Justicia remini regarda est (Justice is to
be denied to none). [30]
 Thus, this Court has held time and again, in a number of decisions, that: [31]

Loss of confidence is a valid ground for dismissing an employee and proof beyond reasonable
doubt of the employees misconduct is not required to dismiss him on this charge. It is sufficient
if there is some basis for such loss of confidence or if the employer has reasonable ground to
believe or to entertain the moral conviction that the employee concerned is responsible for the
misconduct and that the nature of his participation therein rendered him absolutely unworthy of
the trust and confidence demanded by his position.[32]

Parenthetically, the fact that petitioners Jamer and Amortizado had worked
for respondent company for fourteen (14) and thirteen (13) years, respectively,
should be taken against them. The infractions that they committed,
notwithstanding their long years of service with the company, reflects a
regrettable lack of loyaltyloyalty that they should have shouldered instead of
betrayed. If the petitioners length of service is to be regarded as a justifying
circumstance in moderating the dismissal, it will actually become a prize for
disloyalty, perverting the meaning of social justice and undermining the efforts
of labor to cleanse its ranks of all undesirables. [33]

Petitioners also maintain that the NLRC acted with grave abuse of discretion
when it failed to consider the fact that, other than petitioners themselves, there
were four (4) other persons who had access to the company vaults, and hence,
could have been responsible for the aforesaid cash shortages imputed to them.
They aver therefore, that there was a serious flaw and laxity in the supervision
and handling of company funds by respondent Isetann. [34]

We also find this contention devoid of merit.

First, it must pointed out that the petitioners remark that there was laxity in
the accounting procedures of the company is a matter addressed to the
respondent employer. However, this does not excuse dishonesty of employees
and should not in any case hamper the right of the employer to terminate the
employment of petitioners on the ground of loss of confidence or breach of trust.
Precisely, the accounting procedure which called for improvements was based
primarily on trust and confidence. [35]

Secondly, it must be noted that the herein petitioners were store

cashiers and as such, a special and unique employment relationship exists
between them and the respondent company. More than most key positions, that
of cashier calls for the utmost trust and confidence because their primary
function involves basically the handling of a highly essential property of the
respondent employer --- the sales and revenues of the store. Employers are
consequently given wider latitude of discretion in terminating the employment
of managerial employees or other personnel occupying positions of
responsibility, such as in the instant case, than in the case of ordinary rank-and-
file employees, whose termination on the basis of these same grounds requires
proof of involvement in the malfeasance in question. Mere uncorroborated
assertions and accusations by the employer will not suffice. In that respect ,
[36]

we quote with approval the observations of the NLRC:

To expound further, for the position of a cashier, the honesty and integrity of the
persons assuming said position are the primary considerations for the nature of her
work requires that her actuations should be beyond suspicion as they are accorded the
responsibility of handling money and whatever they would do to such property of the
employer largely depend on their trustworthiness. Hence, the right of the employer to
dismiss a cashier guilty of breach and trust and confidence should be recognized. In a
case decided by the Supreme Court it has been ruled that:
Honesty and integrity are the primary considerations in petitioners position. The
nature of his work requires that the actuations should be beyond suspicion, our
empathy with the cause of labor should not blind us to the rights of management. As
we have held, this Court should help stamp out, rather than tolerate, the commission
of irregular acts whenever these are noted. Malpractices should not be allowed to
continue but should be rebuked. (Del Carmen vs. NLRC, 203 SCRA 245) [37]

Finally, we are convinced that the NLRC did not commit grave abuse of
discretion in evaluating the evidence. Petitioners merely denied the charges
against them. Denials are weak forms of defenses, particularly when they are
not substantiated by clear and convincing evidence. The petitioners failure to
[38]

satisfactorily explain the cash shortages, for which sums they are responsible,
given their respective positions in respondent company, is enough reason to
warrant their dismissal on the ground of loss of confidence. They cannot place
the burden on somebody else given the factual circumstances of this case. As
succinctly put by the NLRC:

That there were other persons who had access to the vaults of the appellant company
implying that these other persons could have been responsible for the loss of
the P15,353.78 is of no moment inasmuch as the appellees were the ones who took
first custody of the possession of said collections. As store cashiers, it is expected of
them to exercise ordinary prudence to count the collection and record the same in the
tally sheet before depositing to said vault to avoid a slightest suspicion of having
pocketed part of it should a shortage arise. They did not exert efforts to exercise such
prudence demanded of their positions hence, appellants should not be blamed when
they were called for an investigation when said shortage was discovered.

xxx xxx xxx

That the occurrence of shortages is merely an isolated one and therefore should not be
taken against the complainant-appellees as a ground for loss of trust and confidence
that would cause their termination cannot be given any credence. The shortages
having been established and admitted has provided the employer sufficient basis for
loss of confidence and whether such occurrence is merely an isolated one or has been
repeatedly committed is no longer material. The bone of contention here is whether
there is some basis for such loss of trust and confidence and if the employer has
reasonable ground to believe or to entertain the moral conviction that the employee
concerned is responsible for the misconduct which in the instant case has been
established.[39]

We reiterate the rule that in cases of dismissal for breach of trust and
confidence, proof beyond reasonable doubt of the employees misconduct is not
required. It is sufficient that the employer had reasonable ground to believe that
the employees are responsible for the misconduct which renders him unworthy
of the trust and confidence demanded by their position. In the case at hand, it
[40]

cannot be doubted that respondents succeeded in discharging its burden of

proof.
As regards to the second requisite, the law requires that the employer must
furnish the worker sought to be dismissed with two (2) written notices before
termination may be validly effected: first, a notice apprising the employee of the
particular acts or omission for which his dismissal is sought and, second, a
subsequent notice informing the employee of the decision to dismiss him. [41]

In accordance with this requirement, petitioners were given the required

notices, on August 2, 1990 and then on August 23, 1990. The Court finds that
petitioners were accorded due process before they were dismissed on August
31, 1990. It is a well-established rule that the essence of due process is simply
an opportunity to be heard, or as applied to administrative proceedings, an
opportunity to explain ones side or an opportunity to seek a reconsideration of
the action or ruling complained of. It is evident from the records , that herein
[42]

petitioners were given all the opportunities to defend themselves and air their
side before the Committee on Discipline, having been notified by respondent
Isetanns Human Resources Division Manager, Teresita A. Villanueva, on
August 2, 1990 through letters individually sent to them. However, offered no
explanation or theory which could account for money lost in their possession.
Hence, the company had no other alternative but to terminate their employment.
As we elucidated in the case of Philippine Savings Bank vs. National Labor
Relations Commission, to wit:
[43]

xxx the requirement of due process is satisfied when a fair and reasonable opportunity
to explain his side of the controversy is afforded the party. A formal or trial-type
hearing is not at all times and in all circumstances essential, especially when the
employee chooses not to speak,

WHEREFORE, the assailed decision of the National Labor Relations

Commission in NLRC NCR CA 002074-91 is hereby AFFIRMED. The petition
is DISMISSED for lack of merit.
SO ORDERED.
Bellosillo, (Chairman), Vitug, and Kapunan, JJ., concur.
CASE#5
Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 101279 August 6, 1992

PHILIPPINE ASSOCIATION OF SERVICE EXPORTERS, INC., petitioner,

vs.
HON. RUBEN D. TORRES, as Secretary of the Department of Labor &
Employment, and JOSE N. SARMIENTO, as Administrator of the PHILIPPINE
OVERSEAS EMPLOYMENT ADMINISTRATION, respondents.

De Guzman, Meneses & Associates for petitioner.

GRIÑO-AQUINO, J.:

This petition for prohibition with temporary restraining order was filed by the Philippine
Association of Service Exporters (PASEI, for short), to prohibit and enjoin the Secretary
of the Department of Labor and Employment (DOLE) and the Administrator of the
Philippine Overseas Employment Administration (or POEA) from enforcing and
implementing DOLE Department Order No. 16, Series of 1991 and POEA Memorandum
Circulars Nos. 30 and 37, Series of 1991, temporarily suspending the recruitment by
private employment agencies of Filipino domestic helpers for Hong Kong and vesting in
the DOLE, through the facilities of the POEA, the task of processing and deploying such
workers.

PASEI is the largest national organization of private employment and recruitment

agencies duly licensed and authorized by the POEA, to engaged in the business of
obtaining overseas employment for Filipino landbased workers, including domestic
helpers.

On June 1, 1991, as a result of published stories regarding the abuses suffered by

Filipino housemaids employed in Hong Kong, DOLE Secretary Ruben D. Torres issued
Department Order No. 16, Series of 1991, temporarily suspending the recruitment by
private employment agencies of "Filipino domestic helpers going to Hong Kong" (p.
30, Rollo). The DOLE itself, through the POEA took over the business of deploying such
Hong Kong-bound workers.

In view of the need to establish mechanisms that will enhance the

protection for Filipino domestic helpers going to Hong Kong, the
recruitment of the same by private employment agencies is hereby
temporarily suspended effective 1 July 1991. As such, the DOLE through
the facilities of the Philippine Overseas Employment Administration shall
take over the processing and deployment of household workers bound for
Hong Kong, subject to guidelines to be issued for said purpose.

In support of this policy, all DOLE Regional Directors and the Bureau of
Local Employment's regional offices are likewise directed to coordinate
with the POEA in maintaining a manpower pool of prospective domestic
helpers to Hong Kong on a regional basis.

For compliance. (Emphasis ours; p. 30, Rollo.)

Pursuant to the above DOLE circular, the POEA issued Memorandum Circular No. 30,
Series of 1991, dated July 10, 1991, providing GUIDELINES on the Government
processing and deployment of Filipino domestic helpers to Hong Kong and the
accreditation of Hong Kong recruitment agencies intending to hire Filipino domestic
helpers.

Subject: Guidelines on the Temporary Government Processing and

Deployment of Domestic Helpers to Hong Kong.

Pursuant to Department Order No. 16, series of 1991 and in order to

operationalize the temporary government processing and deployment of
domestic helpers (DHs) to Hong Kong resulting from the temporary
suspension of recruitment by private employment agencies for said skill
and host market, the following guidelines and mechanisms shall govern
the implementation of said policy.

I. Creation of a joint POEA-OWWA Household Workers Placement Unit

(HWPU)

An ad hoc, one stop Household Workers Placement Unit [or HWPU] under
the supervision of the POEA shall take charge of the various operations
involved in the Hong Kong-DH industry segment:

The HWPU shall have the following functions in coordination with

appropriate units and other entities concerned:

1. Negotiations with and Accreditation of Hong Kong Recruitment

Agencies

2. Manpower Pooling

3. Worker Training and Briefing

4. Processing and Deployment

5. Welfare Programs

II. Documentary Requirements and Other Conditions for Accreditation of

Hong Kong Recruitment Agencies or Principals

Recruitment agencies in Hong Kong intending to hire Filipino DHs for their
employers may negotiate with the HWPU in Manila directly or through the
Philippine Labor Attache's Office in Hong Kong.

xxx xxx xxx

X. Interim Arrangement

All contracts stamped in Hong Kong as of June 30 shall continue to be

processed by POEA until 31 July 1991 under the name of the Philippine
agencies concerned. Thereafter, all contracts shall be processed with the
HWPU.

Recruitment agencies in Hong Kong shall submit to the Philippine

Consulate General in Hong kong a list of their accepted applicants in their
pool within the last week of July. The last day of acceptance shall be July
31 which shall then be the basis of HWPU in accepting contracts for
processing. After the exhaustion of their respective pools the only source
of applicants will be the POEA manpower pool.

For strict compliance of all concerned. (pp. 31-35, Rollo.)

On August 1, 1991, the POEA Administrator also issued Memorandum Circular No. 37,
Series of 1991, on the processing of employment contracts of domestic workers for
Hong Kong.

TO: All Philippine and Hong Kong Agencies engaged in the recruitment of
Domestic helpers for Hong Kong

Further to Memorandum Circular No. 30, series of 1991 pertaining to the

government processing and deployment of domestic helpers (DHs) to
Hong Kong, processing of employment contracts which have been
attested by the Hong Kong Commissioner of Labor up to 30 June 1991
shall be processed by the POEA Employment Contracts Processing
Branch up to 15 August 1991 only.

Effective 16 August 1991, all Hong Kong recruitment agent/s hiring DHs
from the Philippines shall recruit under the new scheme which requires
prior accreditation which the POEA.

Recruitment agencies in Hong Kong may apply for accreditation at the

Office of the Labor Attache, Philippine Consulate General where a POEA
team is posted until 31 August 1991. Thereafter, those who failed to have
themselves accredited in Hong Kong may proceed to the POEA-OWWA
Household Workers Placement Unit in Manila for accreditation before their
recruitment and processing of DHs shall be allowed.

Recruitment agencies in Hong Kong who have some accepted applicants

in their pool after the cut-off period shall submit this list of workers upon
accreditation. Only those DHs in said list will be allowed processing
outside of the HWPU manpower pool.

For strict compliance of all concerned. (Emphasis supplied, p. 36, Rollo.)

On September 2, 1991, the petitioner, PASEI, filed this petition for prohibition to annul
the aforementioned DOLE and POEA circulars and to prohibit their implementation for
the following reasons:

1. that the respondents acted with grave abuse of discretion and/or in

excess of their rule-making authority in issuing said circulars;

2. that the assailed DOLE and POEA circulars are contrary to the
Constitution, are unreasonable, unfair and oppressive; and

3. that the requirements of publication and filing with the Office of the
National Administrative Register were not complied with.

There is no merit in the first and second grounds of the petition.

Article 36 of the Labor Code grants the Labor Secretary the power to restrict and
regulate recruitment and placement activities.

Art. 36. Regulatory Power. — The Secretary of Labor shall have the
power to restrict and regulate the recruitment and placement activities of
all agencies within the coverage of this title [Regulation of Recruitment
and Placement Activities] and is hereby authorized to issue orders and
promulgate rules and regulations to carry out the objectives and
implement the provisions of this title. (Emphasis ours.)

On the other hand, the scope of the regulatory authority of the POEA, which was
created by Executive Order No. 797 on May 1, 1982 to take over the functions of the
Overseas Employment Development Board, the National Seamen Board, and the
overseas employment functions of the Bureau of Employment Services, is broad and
far-ranging for:
 1. Among the functions inherited by the POEA from the defunct Bureau of
Employment Services was the power and duty:

"2. To establish and maintain a registration and/or licensing

system to regulate private sector participation in the
recruitment and placement of workers, locally and overseas,
. . ." (Art. 15, Labor Code, Emphasis supplied). (p. 13, Rollo.)

2. It assumed from the defunct Overseas Employment Development

Board the power and duty:

3. To recruit and place workers for overseas employment of

Filipino contract workers on a government to government
arrangement and in such other sectors as policy may dictate
. . . (Art. 17, Labor Code.) (p. 13, Rollo.)

3. From the National Seamen Board, the POEA took over:

2. To regulate and supervise the activities of agents or

representatives of shipping companies in the hiring of
seamen for overseas employment; and secure the best
possible terms of employment for contract seamen workers
and secure compliance therewith. (Art. 20, Labor Code.)

The vesture of quasi-legislative and quasi-judicial powers in administrative bodies is not

unconstitutional, unreasonable and oppressive. It has been necessitated by "the
growing complexity of the modern society" (Solid Homes, Inc. vs. Payawal, 177 SCRA
72, 79). More and more administrative bodies are necessary to help in the regulation of
society's ramified activities. "Specialized in the particular field assigned to them, they
can deal with the problems thereof with more expertise and dispatch than can be
expected from the legislature or the courts of justice" (Ibid.).

It is noteworthy that the assailed circulars do not prohibit the petitioner from engaging in
the recruitment and deployment of Filipino landbased workers for overseas
employment. A careful reading of the challenged administrative issuances discloses that
the same fall within the "administrative and policing powers expressly or by necessary
implication conferred" upon the respondents (People vs. Maceren, 79 SCRA 450). The
power to "restrict and regulate conferred by Article 36 of the Labor Code involves a
grant of police power (City of Naga vs. Court of Appeals, 24 SCRA 898). To "restrict"
means "to confine, limit or stop" (p. 62, Rollo) and whereas the power to "regulate"
means "the power to protect, foster, promote, preserve, and control with due regard for
the interests, first and foremost, of the public, then of the utility and of its patrons"
(Philippine Communications Satellite Corporation vs. Alcuaz, 180 SCRA 218).

The Solicitor General, in his Comment, aptly observed:

. . . Said Administrative Order [i.e., DOLE Administrative Order No. 16]

merely restricted the scope or area of petitioner's business operations by
excluding therefrom recruitment and deployment of domestic helpers for
Hong Kong till after the establishment of the "mechanisms" that will
enhance the protection of Filipino domestic helpers going to Hong Kong.
In fine, other than the recruitment and deployment of Filipino domestic
helpers for Hongkong, petitioner may still deploy other class of Filipino
workers either for Hongkong and other countries and all other classes of
Filipino workers for other countries.

Said administrative issuances, intended to curtail, if not to end, rampant

violations of the rule against excessive collections of placement and
documentation fees, travel fees and other charges committed by private
employment agencies recruiting and deploying domestic helpers to
Hongkong. [They are reasonable, valid and justified under the general
 welfare clause of the Constitution, since the recruitment and deployment
business, as it is conducted today, is affected with public interest.

xxx xxx xxx

The alleged takeover [of the business of recruiting and placing Filipino
domestic helpers in Hongkong] is merely a remedial measure, and expires
after its purpose shall have been attained. This is evident from the tenor of
Administrative Order No. 16 that recruitment of Filipino domestic helpers
going to Hongkong by private employment agencies are hereby
"temporarily suspended effective July 1, 1991."

The alleged takeover is limited in scope, being confined to recruitment of

domestic helpers going to Hongkong only.

xxx xxx xxx

. . . the justification for the takeover of the processing and deploying of

domestic helpers for Hongkong resulting from the restriction of the scope
of petitioner's business is confined solely to the unscrupulous practice of
private employment agencies victimizing applicants for employment as
domestic helpers for Hongkong and not the whole recruitment business in
the Philippines. (pp. 62-65, Rollo.)

The questioned circulars are therefore a valid exercise of the police power as delegated
to the executive branch of Government.

Nevertheless, they are legally invalid, defective and unenforceable for lack of power
publication and filing in the Office of the National Administrative Register as required in
Article 2 of the Civil Code, Article 5 of the Labor Code and Sections 3(1) and 4, Chapter
2, Book VII of the Administrative Code of 1987 which provide:

Art. 2. Laws shall take effect after fifteen (15) days following the
completion of their publication in the Official Gazatte, unless it is otherwise
provided. . . . (Civil Code.)

Art. 5. Rules and Regulations. — The Department of Labor and other

government agencies charged with the administration and enforcement of
this Code or any of its parts shall promulgate the necessary implementing
rules and regulations. Such rules and regulations shall become effective
fifteen (15) days after announcement of their adoption in newspapers of
general circulation. (Emphasis supplied, Labor Code, as amended.)

Sec. 3. Filing. — (1) Every agency shall file with the University of the
Philippines Law Center, three (3) certified copies of every rule adopted by
it. Rules in force on the date of effectivity of this Code which are not filed
within three (3) months shall not thereafter be the basis of any sanction
against any party or persons. (Emphasis supplied, Chapter 2, Book VII of
the Administrative Code of 1987.)

Sec. 4. Effectivity. — In addition to other rule-making requirements

provided by law not inconsistent with this Book, each rule shall become
effective fifteen (15) days from the date of filing as above provided unless
a different date is fixed by law, or specified in the rule in cases of imminent
danger to public health, safety and welfare, the existence of which must
be expressed in a statement accompanying the rule. The agency shall
take appropriate measures to make emergency rules known to persons
who may be affected by them. (Emphasis supplied, Chapter 2, Book VII of
the Administrative Code of 1987).

Once, more we advert to our ruling in Tañada vs. Tuvera, 146 SCRA 446 that:
 . . . Administrative rules and regulations must also be published if their
purpose is to enforce or implement existing law pursuant also to a valid
delegation. (p. 447.)

Interpretative regulations and those merely internal in nature, that is,

regulating only the personnel of the administrative agency and not the
public, need not be published. Neither is publication required of the so-
called letters of instructions issued by administrative superiors concerning
the rules or guidelines to be followed by their subordinates in the
performance of their duties. (p. 448.)

We agree that publication must be in full or it is no publication at all since

its purpose is to inform the public of the content of the laws. (p. 448.)

For lack of proper publication, the administrative circulars in question may not be
enforced and implemented.

WHEREFORE, the writ of prohibition is GRANTED. The implementation of DOLE

Department Order No. 16, Series of 1991, and POEA Memorandum Circulars Nos. 30
and 37, Series of 1991, by the public respondents is hereby SUSPENDED pending
compliance with the statutory requirements of publication and filing under the
aforementioned laws of the land.

SO ORDERED.

Narvasa, C.J., Gutierrez, Jr., Cruz, Feliciano, Padilla, Bidin, Medialdea, Regalado,
Davide, Jr., Romero, Nocon and Bellosillo, JJ., concur.
CASE#6
Republic of the Philippines
Supreme Court
Manila

EN BANC

ANTONIO M. SERRANO, G.R. No. 167614

Petitioner,
Present:

PUNO, C.J.,
QUISUMBING,
YNARES-SANTIAGO,
CARPIO,
AUSTRIA-MARTINEZ,
- versus - CORONA,
CARPIO MORALES,
TINGA,
CHICO-NAZARIO,
VELASCO, Jr.,
NACHURA,
LEONARDO-DE CASTRO,
BRION, and
GALLANT MARITIME SERVICES, PERALTA, JJ.
INC. and MARLOW NAVIGATION
CO., INC., Promulgated:
Respondents. March 24, 2009
x----------------------------------------------------------x

DECISION

AUSTRIA-MARTINEZ, J.:

For decades, the toil of solitary migrants has helped lift entire families and
communities out of poverty. Their earnings have built houses, provided health
care, equipped schools and planted the seeds of businesses. They have woven
together the world by transmitting ideas and knowledge from country to country.
They have provided the dynamic human link between cultures, societies and
economies. Yet, only recently have we begun to understand not only how much
international migration impacts development, but how smart public policies
can magnify this effect.

United Nations Secretary-General Ban Ki-Moon

Global Forum on Migration and Development
 Brussels, July 10, 2007[1]

For Antonio Serrano (petitioner), a Filipino seafarer, the last clause in the
5 paragraph of Section 10, Republic Act (R.A.) No. 8042,[2] to wit:
th

Sec. 10. Money Claims. - x x x 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.

x x x x (Emphasis and underscoring supplied)

does not magnify the contributions of overseas Filipino workers (OFWs) to national
development, but exacerbates the hardships borne by them by unduly limiting their
entitlement in case of illegal dismissal to their lump-sum salary either for the unexpired
portion of their employment contract or for three months for every year of the unexpired
term, whichever is less (subject clause).Petitioner claims that the last clause violates the
OFWs' constitutional rights in that it impairs the terms of their contract, deprives them of
equal protection and denies them due process.

By way of Petition for Review under Rule 45 of the Rules of Court, petitioner assails
the December 8, 2004 Decision[3] and April 1, 2005 Resolution[4] of the Court of Appeals
(CA), which applied the subject clause, entreating this Court to declare the subject clause
unconstitutional.
Petitioner was hired by Gallant Maritime Services, Inc. and Marlow Navigation Co.,
Ltd. (respondents) under a Philippine Overseas Employment Administration (POEA)-
approved Contract of Employment with the following terms and conditions:
Duration of contract 12 months
Position Chief Officer
Basic monthly salary US$1,400.00
Hours of work 48.0 hours per week
Overtime US$700.00 per month
Vacation leave with pay 7.00 days per month[5]

On March 19, 1998, the date of his departure, petitioner was constrained to accept a
downgraded employment contract for the position of Second Officer with a monthly salary
of US$1,000.00, upon the assurance and representation of respondents that he would be
made Chief Officer by the end of April 1998.[6]

Respondents did not deliver on their promise to make petitioner Chief

Officer.[7] Hence, petitioner refused to stay on as Second Officer and was repatriated to
the Philippines on May 26, 1998.[8]

Petitioner's employment contract was for a period of 12 months or from March 19,
1998 up to March 19, 1999, but at the time of his repatriation on May 26, 1998, he had served
only two (2) months and seven (7) days of his contract, leaving an unexpired portion of nine
(9) months and twenty-three (23) days.
 Petitioner filed with the Labor Arbiter (LA) a Complaint[9] against respondents for
constructive dismissal and for payment of his money claims in the total amount of
US$26,442.73, broken down as follows:

May 27/31, 1998 (5 days) incl. Leave pay US$ 413.90

June 01/30, 1998 2,590.00
July 01/31, 1998 2,590.00
August 01/31, 1998 2,590.00
Sept. 01/30, 1998 2,590.00
Oct. 01/31, 1998 2,590.00
Nov. 01/30, 1998 2,590.00
Dec. 01/31, 1998 2,590.00
Jan. 01/31, 1999 2,590.00
Feb. 01/28, 1999 2,590.00
Mar. 1/19, 1999 (19 days) incl. leave pay 1,640.00
--------------------------------------------------------------------------------

25,382.23
Amount adjusted to chief mate's salary
(March 19/31, 1998 to April 1/30, 1998) + 1,060.50[10]
----------------------------------------------------------------------------------------------

TOTAL CLAIM US$ 26,442.73[11]

as well as moral and exemplary damages and attorney's fees.

The LA rendered a Decision dated July 15, 1999, declaring the dismissal of petitioner
illegal and awarding him monetary benefits, to wit:

WHEREFORE, premises considered, judgment is hereby rendered declaring that

the dismissal of the complainant (petitioner) by the respondents in the above-
entitled case was illegal and the respondents are hereby ordered to pay the
complainant [petitioner], jointly and severally, in Philippine Currency, based on
the rate of exchange prevailing at the time of payment, the amount of EIGHT
THOUSAND SEVEN HUNDRED SEVENTY U.S. DOLLARS (US
$8,770.00), representing the complainants salary for three (3) months of the
unexpired portion of the aforesaid contract of employment.

The respondents are likewise ordered to pay the complainant [petitioner], jointly
and severally, in Philippine Currency, based on the rate of exchange prevailing at
the time of payment, the amount of FORTY FIVE U.S. DOLLARS (US$
45.00),[12] representing the complainants claim for a salary differential. In
addition, the respondents are hereby ordered to pay the complainant, jointly and
severally, in Philippine Currency, at the exchange rate prevailing at the time of
payment, the complainants (petitioner's) claim for attorneys fees equivalent to ten
percent (10%) of the total amount awarded to the aforesaid employee under this
Decision.

The claims of the complainant for moral and exemplary damages are hereby
DISMISSED for lack of merit.

All other claims are hereby DISMISSED.

SO ORDERED.[13] (Emphasis supplied)

In awarding petitioner a lump-sum salary of US$8,770.00, the LA based his

computation on the salary period of three months only -- rather than the entire unexpired
portion of nine months and 23 days of petitioner's employment contract - applying the
subject clause. However, the LA applied the salary rate of US$2,590.00, consisting of
petitioner's [b]asic salary, US$1,400.00/month + US$700.00/month, fixed overtime pay, +
US$490.00/month, vacation leave pay = US$2,590.00/compensation per month.[14]

Respondents appealed[15] to the National Labor Relations Commission (NLRC) to

question the finding of the LA that petitioner was illegally dismissed.

Petitioner also appealed[16] to the NLRC on the sole issue that the LA erred in not
applying the ruling of the Court in Triple Integrated Services, Inc. v. National Labor
Relations Commission[17] that in case of illegal dismissal, OFWs are entitled to their salaries
for the unexpired portion of their contracts.[18]

In a Decision dated June 15, 2000, the NLRC modified the LA Decision, to wit:

WHEREFORE, the Decision dated 15 July 1999 is MODIFIED.

Respondents are hereby ordered to pay complainant, jointly and severally, in
Philippine currency, at the prevailing rate of exchange at the time of payment the
following:

1. Three (3) months salary

$1,400 x 3 US$4,200.00
2. Salary differential 45.00
US$4,245.00
3. 10% Attorneys fees 424.50
TOTAL US$4,669.50

The other findings are affirmed.

SO ORDERED.[19]

The NLRC corrected the LA's computation of the lump-sum salary awarded to
petitioner by reducing the applicable salary rate from US$2,590.00 to US$1,400.00 because
R.A. No. 8042 does not provide for the award of overtime pay, which should be proven to
have been actually performed, and for vacation leave pay.[20]

Petitioner filed a Motion for Partial Reconsideration, but this time he questioned the
constitutionality of the subject clause.[21] The NLRC denied the motion.[22]

Petitioner filed a Petition for Certiorari[23] with the CA, reiterating the constitutional
challenge against the subject clause.[24] After initially dismissing the petition on a
technicality, the CA eventually gave due course to it, as directed by this Court in its
Resolution dated August 7, 2003 which granted the petition for certiorari, docketed as G.R.
No. 151833, filed by petitioner.

In a Decision dated December 8, 2004, the CA affirmed the NLRC ruling on the
reduction of the applicable salary rate; however, the CA skirted the constitutional issue raised
by petitioner.[25]

His Motion for Reconsideration[26] having been denied by the

[27]
CA, petitioner brings his cause to this Court on the following grounds:
 I
The Court of Appeals and the labor tribunals have decided the case in a
way not in accord with applicable decision of the Supreme Court involving
similar issue of granting unto the migrant worker back wages equal to the
unexpired portion of his contract of employment instead of limiting it to three (3)
months

II
In the alternative that the Court of Appeals and the Labor Tribunals were
merely applying their interpretation of Section 10 of Republic Act No. 8042, it is
submitted that the Court of Appeals gravely erred in law when it failed to
discharge its judicial duty to decide questions of substance not theretofore
determined by the Honorable Supreme Court, particularly, the constitutional
issues raised by the petitioner on the constitutionality of said law, which
unreasonably, unfairly and arbitrarily limits payment of the award for back wages
of overseas workers to three (3) months.

III
Even without considering the constitutional limitations [of] Sec. 10 of
Republic Act No. 8042, the Court of Appeals gravely erred in law in excluding
from petitioners award the overtime pay and vacation pay provided in his contract
since under the contract they form part of his salary.[28]

On February 26, 2008, petitioner wrote the Court to withdraw his petition as he is
already old and sickly, and he intends to make use of the monetary award for his medical
treatment and medication.[29] Required to comment, counsel for petitioner filed a motion,
urging the court to allow partial execution of the undisputed monetary award and, at the same
time, praying that the constitutional question be resolved.[30]

Considering that the parties have filed their respective memoranda, the Court now
takes up the full merit of the petition mindful of the extreme importance of the constitutional
question raised therein.

On the first and second issues

The unanimous finding of the LA, NLRC and CA that the dismissal of petitioner was
illegal is not disputed. Likewise not disputed is the salary differential of US$45.00 awarded
to petitioner in all three fora. What remains disputed is only the computation of the lump-
sum salary to be awarded to petitioner by reason of his illegal dismissal.
Applying the subject clause, the NLRC and the CA computed the lump-sum salary
of petitioner at the monthly rate of US$1,400.00 covering the period of three months out of
the unexpired portion of nine months and 23 days of his employment contract or a total of
US$4,200.00.

Impugning the constitutionality of the subject clause, petitioner contends that, in

addition to the US$4,200.00 awarded by the NLRC and the CA, he is entitled to
US$21,182.23 more or a total of US$25,382.23, equivalent to his salaries for the entire nine
months and 23 days left of his employment contract, computed at the monthly rate of
US$2,590.00.[31]
The Arguments of Petitioner
 Petitioner contends that the subject clause is unconstitutional because it unduly
impairs the freedom of OFWs to negotiate for and stipulate in their overseas employment
contracts a determinate employment period and a fixed salary package.[32] It also impinges
on the equal protection clause, for it treats OFWs differently from local Filipino workers
(local workers) by putting a cap on the amount of lump-sum salary to which OFWs are
entitled in case of illegal dismissal, while setting no limit to the same monetary award for
local workers when their dismissal is declared illegal; that the disparate treatment is not
reasonable as there is no substantial distinction between the two groups;[33] and that it defeats
Section 18,[34] Article II of the Constitution which guarantees the protection of the rights and
welfare of all Filipino workers, whether deployed locally or overseas.[35]

Moreover, petitioner argues that the decisions of the CA and the labor tribunals are
not in line with existing jurisprudence on the issue of money claims of illegally dismissed
OFWs.Though there are conflicting rulings on this, petitioner urges the Court to sort them
out for the guidance of affected OFWs.[36]
Petitioner further underscores that the insertion of the subject clause into R.A. No.
8042 serves no other purpose but to benefit local placement agencies. He marks the
statement made by the Solicitor General in his Memorandum, viz.:

Often, placement agencies, their liability being solidary, shoulder the

payment of money claims in the event that jurisdiction over the foreign employer
is not acquired by the court or if the foreign employer reneges on its obligation.
Hence, placement agencies that are in good faith and which fulfill their
obligations are unnecessarily penalized for the acts of the foreign employer. To
protect them and to promote their continued helpful contribution in deploying
Filipino migrant workers, liability for money claims was reduced under Section
10 of R.A. No. 8042. [37] (Emphasis supplied)

Petitioner argues that in mitigating the solidary liability of placement agencies, the
subject clause sacrifices the well-being of OFWs. Not only that, the provision makes foreign
employers better off than local employers because in cases involving the illegal dismissal of
employees, foreign employers are liable for salaries covering a maximum of only three
months of the unexpired employment contract while local employers are liable for the full
lump-sum salaries of their employees. As petitioner puts it:

In terms of practical application, the local employers are not limited to the
amount of backwages they have to give their employees they have illegally
dismissed, following well-entrenched and unequivocal jurisprudence on the
matter. On the other hand, foreign employers will only be limited to giving the
illegally dismissed migrant workers the maximum of three (3) months unpaid
salaries notwithstanding the unexpired term of the contract that can be more than
three (3) months.[38]

Lastly, petitioner claims that the subject clause violates the due process clause, for it
deprives him of the salaries and other emoluments he is entitled to under his fixed-period
employment contract.[39]

The Arguments of Respondents

 In their Comment and Memorandum, respondents contend that the constitutional
issue should not be entertained, for this was belatedly interposed by petitioner in his appeal
before the CA, and not at the earliest opportunity, which was when he filed an appeal before
the NLRC.[40]

The Arguments of the Solicitor General

The Solicitor General (OSG)[41] points out that as R.A. No. 8042 took effect on July
15, 1995, its provisions could not have impaired petitioner's 1998 employment
contract. Rather, R.A. No. 8042 having preceded petitioner's contract, the provisions thereof
are deemed part of the minimum terms of petitioner's employment, especially on the matter
of money claims, as this was not stipulated upon by the parties.[42]

Moreover, the OSG emphasizes that OFWs and local workers differ in terms of the
nature of their employment, such that their rights to monetary benefits must necessarily be
treated differently. The OSG enumerates the essential elements that distinguish OFWs from
local workers: first, while local workers perform their jobs within Philippine territory, OFWs
perform their jobs for foreign employers, over whom it is difficult for our courts to acquire
jurisdiction, or against whom it is almost impossible to enforce judgment; and second, as
held in Coyoca v. National Labor Relations Commission[43] and Millares v. National Labor
Relations Commission,[44] OFWs are contractual employees who can never acquire regular
employment status, unlike local workers who are or can become regular employees. Hence,
the OSG posits that there are rights and privileges exclusive to local workers, but not
available to OFWs; that these peculiarities make for a reasonable and valid basis for the
differentiated treatment under the subject clause of the money claims of OFWs who are
illegally dismissed. Thus, the provision does not violate the equal protection clause nor
Section 18, Article II of the Constitution.[45]

Lastly, the OSG defends the rationale behind the subject clause as a police power
measure adopted to mitigate the solidary liability of placement agencies for this redounds to
the benefit of the migrant workers whose welfare the government seeks to promote. The
survival of legitimate placement agencies helps [assure] the government that migrant
workers are properly deployed and are employed under decent and humane conditions.[46]
The Court's Ruling

The Court sustains petitioner on the first and second issues.

When the Court is called upon to exercise its power of judicial review of the acts of
its co-equals, such as the Congress, it does so only when these conditions obtain: (1) that
there is an actual case or controversy involving a conflict of rights susceptible of judicial
determination;[47] (2) that the constitutional question is raised by a proper party[48] and at the
earliest opportunity;[49] and (3) that the constitutional question is the very lis mota of the
case,[50] otherwise the Court will dismiss the case or decide the same on some other
ground.[51]

Without a doubt, there exists in this case an actual controversy directly involving
petitioner who is personally aggrieved that the labor tribunals and the CA computed his
monetary award based on the salary period of three months only as provided under the
subject clause.

The constitutional challenge is also timely. It should be borne in mind that the
requirement that a constitutional issue be raised at the earliest opportunity entails the
interposition of the issue in the pleadings before a competent court, such that, if the issue is
not raised in the pleadings before that competent court, it cannot be considered at the trial
and, if not considered in the trial, it cannot be considered on appeal.[52] Records disclose that
the issue on the constitutionality of the subject clause was first raised, not in petitioner's
appeal with the NLRC, but in his Motion for Partial Reconsideration with said labor
tribunal,[53] and reiterated in his Petition for Certiorari before the CA.[54] Nonetheless, the
issue is deemed seasonably raised because it is not the NLRC but the CA which has the
competence to resolve the constitutional issue. The NLRC is a labor tribunal that merely
performs a quasi-judicial function its function in the present case is limited to
determining questions of fact to which the legislative policy of R.A. No. 8042 is to be applied
and to resolving such questions in accordance with the standards laid down by the law
itself;[55]thus, its foremost function is to administer and enforce R.A. No. 8042, and not to
inquire into the validity of its provisions. The CA, on the other hand, is vested with the power
of judicial review or the power to declare unconstitutional a law or a provision thereof, such
as the subject clause.[56] Petitioner's interposition of the constitutional issue before the CA
was undoubtedly seasonable.The CA was therefore remiss in failing to take up the issue in
its decision.
The third condition that the constitutional issue be critical to the resolution of the case
likewise obtains because the monetary claim of petitioner to his lump-sum salary for the
entire unexpired portion of his 12-month employment contract, and not just for a period of
three months, strikes at the very core of the subject clause.

Thus, the stage is all set for the determination of the constitutionality of the subject
clause.

Does the subject clause violate Section 10,

Article III of the Constitution on non-impairment
of contracts?

The answer is in the negative.

Petitioner's claim that the subject clause unduly interferes with the stipulations in his
contract on the term of his employment and the fixed salary package he will receive[57] is not
tenable.

Section 10, Article III of the Constitution provides:

No law impairing the obligation of contracts shall be passed.

The prohibition is aligned with the general principle that laws newly enacted have
only a prospective operation,[58] and cannot affect acts or contracts already
perfected;[59] however, as to laws already in existence, their provisions are read into contracts
and deemed a part thereof.[60] Thus, the non-impairment clause under Section 10, Article II
is limited in application to laws about to be enacted that would in any way derogate from
existing acts or contracts by enlarging, abridging or in any manner changing the intention of
the parties thereto.

As aptly observed by the OSG, the enactment of R.A. No. 8042 in 1995 preceded the
execution of the employment contract between petitioner and respondents in 1998. Hence,
it cannot be argued that R.A. No. 8042, particularly the subject clause, impaired the
employment contract of the parties. Rather, when the parties executed their 1998
employment contract, they were deemed to have incorporated into it all the provisions of
R.A. No. 8042.

But even if the Court were to disregard the timeline, the subject clause may not be
declared unconstitutional on the ground that it impinges on the impairment clause, for the
law was enacted in the exercise of the police power of the State to regulate a business,
profession or calling, particularly the recruitment and deployment of OFWs, with the noble
end in view of ensuring respect for the dignity and well-being of OFWs wherever they may
be employed.[61] Police power legislations adopted by the State to promote the health, morals,
peace, education, good order, safety, and general welfare of the people are generally
applicable not only to future contracts but even to those already in existence, for all private
contracts must yield to the superior and legitimate measures taken by the State to promote
public welfare.[62]

Does the subject clause violate Section 1,

Article III of the Constitution, and Section 18,
Article II and Section 3, Article XIII on labor
as a protected sector?

The answer is in the affirmative.

Section 1, Article III of the Constitution guarantees:

No person shall be deprived of life, liberty, or property without due process of

law nor shall any person be denied the equal protection of the law.

Section 18,[63] Article II and Section 3,[64] Article XIII accord all members of the labor
sector, without distinction as to place of deployment, full protection of their rights and
welfare.

To Filipino workers, the rights guaranteed under the foregoing constitutional

provisions translate to economic security and parity: all monetary benefits should be equally
enjoyed by workers of similar category, while all monetary obligations should be borne by
them in equal degree; none should be denied the protection of the laws which is enjoyed by,
or spared the burden imposed on, others in like circumstances.[65]

Such rights are not absolute but subject to the inherent power of Congress to
incorporate, when it sees fit, a system of classification into its legislation; however, to be
valid, the classification must comply with these requirements: 1) it is based on substantial
distinctions; 2) it is germane to the purposes of the law; 3) it is not limited to existing
conditions only; and 4) it applies equally to all members of the class.[66]

There are three levels of scrutiny at which the Court reviews the constitutionality of a
classification embodied in a law: a) the deferential or rational basis scrutiny in which the
challenged classification needs only be shown to be rationally related to serving a legitimate
state interest;[67] b) the middle-tier or intermediate scrutiny in which the government must
show that the challenged classification serves an important state interest and that the
classification is at least substantially related to serving that interest;[68] and c) strict
judicial scrutiny[69] in which a legislative classification which impermissibly interferes with
the exercise of a fundamental right[70] or operates to the peculiar disadvantage of a suspect
class[71] is presumed unconstitutional, and the burden is upon the government to prove that
the classification is necessary to achieve a compelling state interest and that it is the least
restrictive means to protect such interest.[72]

Under American jurisprudence, strict judicial scrutiny is triggered by suspect

classifications[73] based on race[74] or gender[75] but not when the classification is drawn along
income categories.[76]

It is different in the Philippine setting. In Central Bank (now Bangko Sentral ng

Pilipinas) Employee Association, Inc. v. Bangko Sentral ng Pilipinas,[77] the constitutionality
of a provision in the charter of the Bangko Sentral ng Pilipinas (BSP), a government
financial institution (GFI), was challenged for maintaining its rank-and-file employees under
the Salary Standardization Law (SSL), even when the rank-and-file employees of other GFIs
had been exempted from the SSL by their respective charters. Finding that the disputed
provision contained a suspect classification based on salary grade, the Court deliberately
employed the standard of strict judicial scrutiny in its review of the constitutionality of said
provision. More significantly, it was in this case that the Court revealed the broad outlines of
its judicial philosophy, to wit:

Congress retains its wide discretion in providing for a valid classification,

and its policies should be accorded recognition and respect by the courts of justice
except when they run afoul of the Constitution.The deference stops where the
classification violates a fundamental right, or prejudices persons accorded
special protection by the Constitution. When these violations arise, this Court
must discharge its primary role as the vanguard of constitutional guaranties, and
require a stricter and more exacting adherence to constitutional
limitations. Rational basis should not suffice.

Admittedly, the view that prejudice to persons accorded special

protection by the Constitution requires a stricter judicial scrutiny finds no
support in American or English jurisprudence. Nevertheless, these foreign
decisions and authorities are not per se controlling in this jurisdiction. At best,
they are persuasive and have been used to support many of our decisions. We
should not place undue and fawning reliance upon them and regard them as
indispensable mental crutches without which we cannot come to our own
decisions through the employment of our own endowments. We live in a
different ambience and must decide our own problems in the light of our own
interests and needs, and of our qualities and even idiosyncrasies as a people, and
always with our own concept of law and justice. Our laws must be construed in
accordance with the intention of our own lawmakers and such intent may be
deduced from the language of each law and the context of other local legislation
related thereto. More importantly, they must be construed to serve our own public
interest which is the be-all and the end-all of all our laws. And it need not be
stressed that our public interest is distinct and different from others.

xxxx

Further, the quest for a better and more equal world calls for the use of
equal protection as a tool of effective judicial intervention.

Equality is one ideal which cries out for bold attention and action in the
Constitution. The Preamble proclaims equality as an ideal precisely in protest
against crushing inequities in Philippine society. The command to promote social
justice in Article II, Section 10, in all phases of national development, further
explicitated in Article XIII, are clear commands to the State to take affirmative
action in the direction of greater equality. x x x [T]here is thus in the Philippine
Constitution no lack of doctrinal support for a more vigorous state effort towards
achieving a reasonable measure of equality.

Our present Constitution has gone further in guaranteeing vital social

and economic rights to marginalized groups of society, including labor. 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
privilege in life should have more in law. And the obligation to afford protection
to labor is incumbent not only on the legislative and executive branches but
also on the judiciary to translate this pledge into a living reality. Social justice
calls for the humanization of laws and the equalization of social and economic
forces by the State so that justice in its rational and objectively secular
conception may at least be approximated.

xxxx

Under most circumstances, the Court will exercise judicial restraint in

deciding questions of constitutionality, recognizing the broad discretion given to
Congress in exercising its legislative power. Judicial scrutiny would be based on
the rational basis test, and the legislative discretion would be given deferential
treatment.

But if the challenge to the statute is premised on the denial of a

fundamental right, or the perpetuation of prejudice against persons favored by
the Constitution with special protection, judicial scrutiny ought to be more
strict. A weak and watered down view would call for the abdication of this Courts
solemn duty to strike down any law repugnant to the Constitution and the rights
it enshrines. This is true whether the actor committing the unconstitutional act is
a private person or the government itself or one of its instrumentalities.
Oppressive acts will be struck down regardless of the character or nature of the
actor.

xxxx

In the case at bar, the challenged proviso operates on the basis of the salary
grade or officer-employee status. It is akin to a distinction based on economic
class and status, with the higher grades as recipients of a benefit specifically
withheld from the lower grades. Officers of the BSP now receive higher
 compensation packages that are competitive with the industry, while the poorer,
low-salaried employees are limited to the rates prescribed by the SSL. The
implications are quite disturbing: BSP rank-and-file employees are paid the
strictly regimented rates of the SSL while employees higher in rank - possessing
higher and better education and opportunities for career advancement - are given
higher compensation packages to entice them to stay. Considering that majority,
if not all, the rank-and-file employees consist of people whose status and rank
in life are less and limited, especially in terms of job marketability, it is they -
and not the officers - who have the real economic and financial need for the
adjustment . This is in accord with the policy of the Constitution "to free the
people from poverty, provide adequate social services, extend to them a decent
standard of living, and improve the quality of life for all. Any act of Congress
that runs counter to this constitutional desideratum deserves strict scrutiny by
this Court before it can pass muster. (Emphasis supplied)

Imbued with the same sense of obligation to afford protection to labor, the Court in
the present case also employs the standard of strict judicial scrutiny, for it perceives in the
subject clause a suspect classification prejudicial to OFWs.

Upon cursory reading, the subject clause appears facially neutral, for it applies to all
OFWs. However, a closer examination reveals that the subject clause has a discriminatory
intent against, and an invidious impact on, OFWs at two levels:

First, OFWs with employment contracts of less than one year vis--vis
OFWs with employment contracts of one year or more;

Second, among OFWs with employment contracts of more than one year;
and

Third, OFWs vis--vis local workers with fixed-period employment;

OFWs with employment contracts of less than

one year vis--vis OFWs with employment
contracts of one year or more

As pointed out by petitioner,[78] it was in Marsaman Manning Agency, Inc. v.

National Labor Relations Commission[79] (Second Division, 1999) that the Court laid down
the following rules on the application of the periods prescribed under Section 10(5) of R.A.
No. 804, to wit:

A plain reading of Sec. 10 clearly reveals that the choice of which

amount to award an illegally dismissed overseas contract worker, i.e., whether
his salaries for the unexpired portion of his employment contract or three (3)
months salary for every year of the unexpired term, whichever is less, comes
into play only when the employment contract concerned has a term of at least
one (1) year or more. This is evident from the words for every year of the
unexpired term which follows the words salaries x x x for three months. To
follow petitioners thinking that private respondent is entitled to three (3) months
salary only simply because it is the lesser amount is to completely disregard and
overlook some words used in the statute while giving effect to some. This is
contrary to the well-established rule in legal hermeneutics that in interpreting a
statute, care should be taken that every part or word thereof be given effect since
the law-making body is presumed to know the meaning of the words employed
 in the statue and to have used them advisedly. Ut res magis valeat quam
pereat.[80] (Emphasis supplied)

In Marsaman, the OFW involved was illegally dismissed two months into his 10-month
contract, but was awarded his salaries for the remaining 8 months and 6 days of his contract.

Prior to Marsaman, however, there were two cases in which the Court made
conflicting rulings on Section 10(5). One was Asian Center for Career and Employment
System and Services v. National Labor Relations Commission (Second Division, October
1998),[81] which involved an OFW who was awarded a two-year employment contract, but
was dismissed after working for one year and two months. The LA declared his dismissal
illegal and awarded him SR13,600.00 as lump-sum salary covering eight months,
the unexpired portion of his contract. On appeal, the Court reduced the award to SR3,600.00
equivalent to his three months salary, this being the lesser value, to wit:

Under Section 10 of R.A. No. 8042, a worker dismissed from overseas

employment without just, valid or authorized cause is entitled to his salary for the
unexpired portion of his employment contract or for three (3) months for every
year of the unexpired term, whichever is less.

In the case at bar, the unexpired portion of private respondents

employment contract is eight (8) months. Private respondent should therefore be
paid his basic salary corresponding to three (3) months or a total of SR3,600.[82]

Another was Triple-Eight Integrated Services, Inc. v. National Labor Relations

Commission (Third Division, December 1998),[83] which involved an OFW (therein
respondent Erlinda Osdana) who was originally granted a 12-month contract, which was
deemed renewed for another 12 months. After serving for one year and seven-and-a-half
months, respondent Osdana was illegally dismissed, and the Court awarded her salaries for
the entire unexpired portion of four and one-half months of her contract.

The Marsaman interpretation of Section 10(5) has since been adopted in the
following cases:

Period Applied in
Case Title Contract Period of Unexpired the Computation
Period Service Period of the Monetary
Award
Skippers v. 6 months 2 months 4 months 4 months
Maguad[84]
Bahia Shipping 9 months 8 months 4 months 4 months
v. Reynaldo
Chua [85]
Centennial 9 months 4 months 5 months 5 months
Transmarine v.
dela Cruz l[86]
Talidano v. 12 months 3 months 9 months 3 months
Falcon[87]
Univan v. 12 months 3 months 9 months 3 months
CA [88]
 Oriental v. 12 months more than 2 10 months 3 months
CA [89] months
PCL v. 12 months more than 2 more or less 9 3 months
NLRC[90] months months
Olarte v. 12 months 21 days 11 months and 9 3 months
Nayona[91] days
JSS v. 12 months 16 days 11 months and 3 months
Ferrer[92] 24 days
Pentagon v. 12 months 9 months 2 months and 23 2 months and 23
Adelantar[93] and 7 days days days
Phil. Employ 12 months 10 months 2 months Unexpired portion
v. Paramio,
et al.[94]
Flourish 2 years 26 days 23 months and 4 6 months or 3
Maritime v. days months for each
Almanzor [95] year of contract
Athenna 1 year, 10 1 month 1 year, 9 months 6 months or 3
Manpower v. months and and 28 days months for each
Villanos [96] 28 days year of contract
As the foregoing matrix readily shows, the subject clause classifies OFWs into two
categories. The first category includes OFWs with fixed-period employment contracts of
less than one year; in case of illegal dismissal, they are entitled to their salaries for the entire
unexpired portion of their contract. The second category consists of OFWs with fixed-period
employment contracts of one year or more; in case of illegal dismissal, they are entitled to
monetary award equivalent to only 3 months of the unexpired portion of their contracts.

The disparity in the treatment of these two groups cannot be discounted. In Skippers,
the respondent OFW worked for only 2 months out of his 6-month contract, but was awarded
his salaries for the remaining 4 months. In contrast, the respondent OFWs
in Oriental and PCL who had also worked for about 2 months out of their 12-month
contracts were awarded their salaries for only 3 months of the unexpired portion of their
contracts. Even the OFWs involved in Talidano and Univan who had worked for a longer
period of 3 months out of their 12-month contracts before being illegally dismissed were
awarded their salaries for only 3 months.

To illustrate the disparity even more vividly, the Court assumes a hypothetical OFW-
A with an employment contract of 10 months at a monthly salary rate of US$1,000.00 and
a hypothetical OFW-B with an employment contract of 15 months with the same monthly
salary rate of US$1,000.00. Both commenced work on the same day and under the same
employer, and were illegally dismissed after one month of work. Under the subject clause,
OFW-A will be entitled to US$9,000.00, equivalent to his salaries for the remaining 9
months of his contract, whereas OFW-B will be entitled to only US$3,000.00, equivalent to
his salaries for 3 months of the unexpired portion of his contract, instead of US$14,000.00
for the unexpired portion of 14 months of his contract, as the US$3,000.00 is the lesser
amount.

The disparity becomes more aggravating when the Court takes into account
jurisprudence that, prior to the effectivity of R.A. No. 8042 on July 14, 1995,[97] illegally
dismissed OFWs, no matter how long the period of their employment contracts, were
entitled to their salaries for the entire unexpired portions of their contracts. The matrix below
speaks for itself:

Case Title Contract Period of Unexpired Period Applied in the

Period Service Period Computation of the
Monetary Award
ATCI v. CA, 2 years 2 months 22 months 22 months
et al.[98]
Phil. Integrated 2 years 7 days 23 months and 23 months and 23
v. NLRC[99] 23 days days
JGB v. NLC[100] 2 years 9 months 15 months 15 months
Agoy v. 2 years 2 months 22 months 22 months
NLRC[101]
EDI v. NLRC, 2 years 5 months 19 months 19 months
et al.[102]
Barros v. 12 months 4 months 8 months 8 months
NLRC, et al.[103]
Philippine 12 months 6 months 5 months and 5 months and 18 days
Transmarine v. and 22 days 18 days
Carilla[104]

It is plain that prior to R.A. No. 8042, all OFWs, regardless of contract periods or the
unexpired portions thereof, were treated alike in terms of the computation of their monetary
benefits in case of illegal dismissal. Their claims were subjected to a uniform rule of
computation: their basic salaries multiplied by the entire unexpired portion of their
employment contracts.

The enactment of the subject clause in R.A. No. 8042 introduced a differentiated rule
of computation of the money claims of illegally dismissed OFWs based on their employment
periods, in the process singling out one category whose contracts have an unexpired portion
of one year or more and subjecting them to the peculiar disadvantage of having their
monetary awards limited to their salaries for 3 months or for the unexpired portion thereof,
whichever is less, but all the while sparing the other category from such prejudice, simply
because the latter's unexpired contractsfall short of one year.

Among OFWs With Employment

Contracts of More Than One Year

Upon closer examination of the terminology employed in the subject clause, the
Court now has misgivings on the accuracy of the Marsaman interpretation.

The Court notes that the subject clause or for three (3) months for every year of the
unexpired term, whichever is less contains the qualifying phrases every year and unexpired
term. By its ordinary meaning, the word term means a limited or definite extent of
time.[105] Corollarily, that every year is but part of an unexpired term is significant in many
ways: first, the unexpired term must be at least one year, for if it were any
shorter, there would be no occasion for such unexpired term to be measured by every year;
and second, the original term must be more than one year, for otherwise, whatever would be
the unexpired term thereof will not reach even a year. Consequently, the more decisive factor
in the determination of when the subject clause for three (3) months for every year of the
unexpired term, whichever is less shall apply is not the length of the original contract period
as held in Marsaman,[106] but the length of the unexpired portion of the contract period -- the
subject clause applies in cases when the unexpired portion of the contract period is at least
one year, which arithmetically requires that the original contract period be more than one
year.

Viewed in that light, the subject clause creates a sub-layer of discrimination among
OFWs whose contract periods are for more than one year: those who are illegally dismissed
with less than one year left in their contracts shall be entitled to their salaries for the entire
unexpired portion thereof, while those who are illegally dismissed with one year or more
remaining in their contracts shall be covered by the subject clause, and their monetary
benefits limited to their salaries for three months only.

To concretely illustrate the application of the foregoing interpretation of the subject

clause, the Court assumes hypothetical OFW-C and OFW-D, who each have a 24-month
contract at a salary rate of US$1,000.00 per month. OFW-C is illegally dismissed on the
12th month, and OFW-D, on the 13th month. Considering that there is at least 12 months
remaining in the contract period of OFW-C, the subject clause applies to the computation of
the latter's monetary benefits. Thus, OFW-C will be entitled, not to US$12,000,00 or the
latter's total salaries for the 12 months unexpired portion of the contract, but to the lesser
amount of US$3,000.00 or the latter's salaries for 3 months out of the 12-month unexpired
term of the contract. On the other hand, OFW-D is spared from the effects of the subject
clause, for there are only 11 months left in the latter's contract period. Thus, OFW-D will be
entitled to US$11,000.00, which is equivalent to his/her total salaries for the entire 11-month
unexpired portion.

OFWs vis--vis Local Workers

With Fixed-Period Employment

As discussed earlier, prior to R.A. No. 8042, a uniform system of computation of the
monetary awards of illegally dismissed OFWs was in place. This uniform system was
applicable even to local workers with fixed-term employment.[107]

The earliest rule prescribing a uniform system of computation was actually Article
299 of the Code of Commerce (1888),[108] to wit:

Article 299. If the contracts between the merchants and their shop clerks
and employees should have been made of a fixed period, none of the
contracting parties, without the consent of the other, may withdraw from the
fulfillment of said contract until the termination of the period agreed upon.

Persons violating this clause shall be subject to indemnify the loss and
damage suffered, with the exception of the provisions contained in the following
articles.
 In Reyes v. The Compaia Maritima,[109] the Court applied the foregoing provision to
determine the liability of a shipping company for the illegal discharge of its managers prior
to the expiration of their fixed-term employment. The Court therein held the shipping
company liable for the salaries of its managers for the remainder of their fixed-term
employment.
There is a more specific rule as far as seafarers are concerned: Article 605 of the Code
of Commerce which provides:

Article 605. If the contracts of the captain and members of the crew with
the agent should be for a definite period or voyage, they cannot be discharged
until the fulfillment of their contracts, except for reasons of insubordination in
serious matters, robbery, theft, habitual drunkenness, and damage caused to the
vessel or to its cargo by malice or manifest or proven negligence.

Article 605 was applied to Madrigal Shipping Company, Inc. v. Ogilvie,[110] in

which the Court held the shipping company liable for the salaries and subsistence allowance
of its illegally dismissed employees for the entire unexpired portion of their employment
contracts.

While Article 605 has remained good law up to the present,[111] Article 299 of the
Code of Commerce was replaced by Art. 1586 of the Civil Code of 1889, to wit:
Article 1586. Field hands, mechanics, artisans, and other laborers hired
for a certain time and for a certain work cannot leave or be dismissed without
sufficient cause, before the fulfillment of the contract.(Emphasis supplied.)

Citing Manresa, the Court in Lemoine v. Alkan[112] read the disjunctive "or" in Article 1586
as a conjunctive "and" so as to apply the provision to local workers who are employed for a
time certain although for no particular skill. This interpretation of Article 1586 was reiterated
in Garcia Palomar v. Hotel de France Company.[113] And in
both Lemoine and Palomar, the Court adopted the general principle that in actions for
wrongful discharge founded on Article 1586, local workers are entitled to recover damages
to the extent of the amount stipulated to be paid to them by the terms of their contract. On
the computation of the amount of such damages, the Court in Aldaz v. Gay[114] held:
The doctrine is well-established in American jurisprudence, and nothing
has been brought to our attention to the contrary under Spanish jurisprudence, that
when an employee is wrongfully discharged it is his duty to seek other
employment of the same kind in the same community, for the purpose of reducing
the damages resulting from such wrongful discharge. However, while this is the
general rule, the burden of showing that he failed to make an effort to secure other
employment of a like nature, and that other employment of a like nature was
obtainable, is upon the defendant. When an employee is wrongfully discharged
under a contract of employment his prima facie damage is the amount which
he would be entitled to had he continued in such employment until the
termination of the period. (Howard vs. Daly, 61 N. Y., 362; Allen vs. Whitlark,
99 Mich., 492; Farrell vs. School District No. 2, 98 Mich., 43.)[115] (Emphasis
supplied)
On August 30, 1950, the New Civil Code took effect with new provisions on fixed-
term employment: Section 2 (Obligations with a Period), Chapter 3, Title I, and Sections 2
(Contract of Labor) and 3 (Contract for a Piece of Work), Chapter 3, Title VIII, Book
IV.[116] Much like Article 1586 of the Civil Code of 1889, the new provisions of the Civil
Code do not expressly provide for the remedies available to a fixed-term worker who is
illegally discharged. However, it is noted that in Mackay Radio & Telegraph Co., Inc. v.
Rich,[117] the Court carried over the principles on the payment of damages underlying Article
1586 of the Civil Code of 1889 and applied the same to a case involving the illegal discharge
of a local worker whose fixed-period employment contract was entered into in 1952, when
the new Civil Code was already in effect.[118]

More significantly, the same principles were applied to cases involving overseas
Filipino workers whose fixed-term employment contracts were illegally terminated, such as
in First Asian Trans & Shipping Agency, Inc. v. Ople,[119] involving seafarers who were
illegally discharged. In Teknika Skills and Trade Services, Inc. v. National Labor Relations
Commission,[120] an OFW who was illegally dismissed prior to the expiration of her fixed-
period employment contract as a baby sitter, was awarded salaries corresponding to the
unexpired portion of her contract. The Court arrived at the same ruling in Anderson v.
National Labor Relations Commission,[121] which involved a foreman hired in 1988 in Saudi
Arabia for a fixed term of two years, but who was illegally dismissed after only nine months
on the job -- the Court awarded him salaries corresponding to 15 months, the unexpired
portion of his contract. In Asia World Recruitment, Inc. v. National Labor Relations
Commission,[122] a Filipino working as a security officer in 1989 in Angola was awarded his
salaries for the remaining period of his 12-month contract after he was wrongfully
discharged. Finally, in Vinta Maritime Co., Inc. v. National Labor Relations
Commission,[123] an OFW whose 12-month contract was illegally cut short in the second
month was declared entitled to his salaries for the remaining 10 months of his contract.

In sum, prior to R.A. No. 8042, OFWs and local workers with fixed-term employment
who were illegally discharged were treated alike in terms of the computation of their money
claims: they were uniformly entitled to their salaries for the entire unexpired portions of their
contracts. But with the enactment of R.A. No. 8042, specifically the adoption of the subject
clause, illegally dismissed OFWs with an unexpired portion of one year or more in their
employment contract have since been differently treated in that their money claims are
subject to a 3-month cap, whereas no such limitation is imposed on local workers with fixed-
term employment.

The Court concludes that the subject clause contains a suspect classification in
that, in the computation of the monetary benefits of fixed-term employees who are illegally
discharged, it imposes a 3-month cap on the claim of OFWs with an unexpired portion of
one year or more in their contracts, but none on the claims of other OFWs or local
workers with fixed-term employment. The subject clause singles out one classification of
OFWs and burdens it with a peculiar disadvantage.

There being a suspect classification involving a vulnerable sector protected by the

Constitution, the Court now subjects the classification to a strict judicial scrutiny, and
determines whether it serves a compelling state interest through the least restrictive means.

What constitutes compelling state interest is measured by the scale of rights and
powers arrayed in the Constitution and calibrated by history.[124] It is akin to the paramount
interest of the state[125] for which some individual liberties must give way, such as the public
interest in safeguarding health or maintaining medical standards,[126] or in maintaining access
to information on matters of public concern.[127]

In the present case, the Court dug deep into the records but found no compelling state
interest that the subject clause may possibly serve.

The OSG defends the subject clause as a police power measure designed to protect
the employment of Filipino seafarers overseas x x x. By limiting the liability to three months
[sic], Filipino seafarers have better chance of getting hired by foreign employers. The
limitation also protects the interest of local placement agencies, which otherwise may be
made to shoulder millions of pesos in termination pay.[128]

The OSG explained further:

Often, placement agencies, their liability being solidary, shoulder the
payment of money claims in the event that jurisdiction over the foreign employer
is not acquired by the court or if the foreign employer reneges on its obligation.
Hence, placement agencies that are in good faith and which fulfill their
obligations are unnecessarily penalized for the acts of the foreign employer. To
protect them and to promote their continued helpful contribution in deploying
Filipino migrant workers, liability for money are reduced under Section 10 of
RA 8042.

This measure redounds to the benefit of the migrant workers whose

welfare the government seeks to promote. The survival of legitimate placement
agencies helps [assure] the government that migrant workers are properly
deployed and are employed under decent and humane conditions.[129] (Emphasis
supplied)

However, nowhere in the Comment or Memorandum does the OSG cite the source
of its perception of the state interest sought to be served by the subject clause.

The OSG locates the purpose of R.A. No. 8042 in the speech of Rep. Bonifacio
Gallego in sponsorship of House Bill No. 14314 (HB 14314), from which the law
originated;[130] but the speech makes no reference to the underlying reason for the adoption
of the subject clause. That is only natural for none of the 29 provisions in HB 14314
resembles the subject clause.

On the other hand, Senate Bill No. 2077 (SB 2077) contains a provision on money
claims, to wit:

Sec. 10. Money Claims. - Notwithstanding any provision of law to the

contrary, the Labor Arbiters of the National Labor Relations Commission
(NLRC) shall have the original and exclusive jurisdiction to hear and decide,
within ninety (90) calendar days after the filing of the complaint, the claims
arising out of an employer-employee relationship or by virtue of the complaint,
the claim arising out of an employer-employee relationship or by virtue of any
law or contract involving Filipino workers for overseas employment including
claims for actual, moral, exemplary and other forms of damages.

The liability of the principal and the recruitment/placement agency or any

and all claims under this Section shall be joint and several.
 Any compromise/amicable settlement or voluntary agreement on any
money claims exclusive of damages under this Section shall not be less than fifty
percent (50%) of such money claims: Provided, That any installment payments,
if applicable, to satisfy any such compromise or voluntary settlement shall not be
more than two (2) months. Any compromise/voluntary agreement in violation of
this paragraph shall be null and void.

Non-compliance with the mandatory period for resolutions of cases

provided under this Section shall subject the responsible officials to any or all of
the following penalties:

(1) The salary of any such official who fails to render his decision
or resolution within the prescribed period shall be, or caused to be,
withheld until the said official complies therewith;
(2) Suspension for not more than ninety (90) days; or

(3) Dismissal from the service with disqualification to hold any

appointive public office for five (5) years.

Provided, however, That the penalties herein provided shall be without

prejudice to any liability which any such official may have incurred under other
existing laws or rules and regulations as a consequence of violating the provisions
of this paragraph.

But significantly, Section 10 of SB 2077 does not provide for any rule on the computation
of money claims.

A rule on the computation of money claims containing the subject clause was inserted
and eventually adopted as the 5th paragraph of Section 10 of R.A. No. 8042. The Court
examined the rationale of the subject clause in the transcripts of the Bicameral Conference
Committee (Conference Committee) Meetings on the Magna Carta on OCWs (Disagreeing
Provisions of Senate Bill No. 2077 and House Bill No. 14314). However, the Court finds no
discernible state interest, let alone a compelling one, that is sought to be protected or
advanced by the adoption of the subject clause.

In fine, the Government has failed to discharge its burden of proving the existence of
a compelling state interest that would justify the perpetuation of the discrimination against
OFWs under the subject clause.

Assuming that, as advanced by the OSG, the purpose of the subject clause is to protect
the employment of OFWs by mitigating the solidary liability of placement agencies, such
callous and cavalier rationale will have to be rejected. There can never be a justification for
any form of government action that alleviates the burden of one sector, but imposes the same
burden on another sector, especially when the favored sector is composed of private
businesses such as placement agencies, while the disadvantaged sector is composed of
OFWs whose protection no less than the Constitution commands. The idea that private
business interest can be elevated to the level of a compelling state interest is odious.

Moreover, even if the purpose of the subject clause is to lessen the solidary liability
of placement agencies vis-a-vis their foreign principals, there are mechanisms already in
place that can be employed to achieve that purpose without infringing on the constitutional
rights of OFWs.

The POEA Rules and Regulations Governing the Recruitment and Employment of
Land-Based Overseas Workers, dated February 4, 2002, imposes administrative disciplinary
measures on erring foreign employers who default on their contractual obligations to migrant
workers and/or their Philippine agents. These disciplinary measures range from temporary
disqualification to preventive suspension. The POEA Rules and Regulations Governing the
Recruitment and Employment of Seafarers, dated May 23, 2003, contains similar
administrative disciplinary measures against erring foreign employers.

Resort to these administrative measures is undoubtedly the less restrictive means of

aiding local placement agencies in enforcing the solidary liability of their foreign principals.

Thus, the subject clause in the 5th paragraph of Section 10 of R.A. No. 8042 is
violative of the right of petitioner and other OFWs to equal protection.

Further, there would be certain misgivings if one is to approach the declaration of the
unconstitutionality of the subject clause from the lone perspective that the clause directly
violates state policy on labor under Section 3,[131] Article XIII of the Constitution.

While all the provisions of the 1987 Constitution are presumed self-executing,,[132] there are
some which this Court has declared not judicially enforceable, Article XIII being
one,[133]particularly Section 3 thereof, the nature of which, this Court, in Agabon v. National
Labor Relations Commission,[134] has described to be not self-actuating:

Thus, the constitutional mandates of protection to labor and security of

tenure may be deemed as self-executing in the sense that these are automatically
acknowledged and observed without need for any enabling legislation. However,
to declare that the constitutional provisions are enough to guarantee the full
exercise of the rights embodied therein, and the realization of ideals therein
expressed, would be impractical, if not unrealistic. The espousal of such view
presents the dangerous tendency of being overbroad and exaggerated. The
guarantees of "full protection to labor" and "security of tenure", when examined
in isolation, are facially unqualified, and the broadest interpretation possible
suggests a blanket shield in favor of labor against any form of removal regardless
of circumstance. This interpretation implies an unimpeachable right to continued
employment-a utopian notion, doubtless-but still hardly within the contemplation
of the framers. Subsequent legislation is still needed to define the parameters of
these guaranteed rights to ensure the protection and promotion, not only the rights
of the labor sector, but of the employers' as well. Without specific and pertinent
legislation, judicial bodies will be at a loss, formulating their own conclusion to
approximate at least the aims of the Constitution.

Ultimately, therefore, Section 3 of Article XIII cannot, on its own, be a

source of a positive enforceable right to stave off the dismissal of an employee
for just cause owing to the failure to serve proper notice or hearing. As manifested
by several framers of the 1987 Constitution, the provisions on social justice
require legislative enactments for their enforceability.[135] (Emphasis added)
 Thus, Section 3, Article XIII cannot be treated as a principal source of direct
enforceable rights, for the violation of which the questioned clause may be declared
unconstitutional. It may unwittingly risk opening the floodgates of litigation to every worker
or union over every conceivable violation of so broad a concept as social justice for labor.

It must be stressed that Section 3, Article XIII does not directly bestow on the
working class any actual enforceable right, but merely clothes it with the status of a sector
for whom the Constitution urges protection through executive or legislative action
and judicial recognition. Its utility is best limited to being an impetus not just for the
executive and legislative departments, but for the judiciary as well, to protect the welfare
of the working class. And it was in fact consistent with that constitutional agenda that the
Court in Central Bank (now Bangko Sentral ng Pilipinas) Employee Association, Inc. v.
Bangko Sentral ng Pilipinas, penned by then Associate Justice now Chief Justice
Reynato S. Puno, formulated the judicial precept that when the challenge to a statute is
premised on the perpetuation of prejudice against persons favored by the Constitution
with special protection -- such as the working class or a section thereof -- the Court may
recognize the existence of a suspect classification and subject the same to strict judicial
scrutiny.

The view that the concepts of suspect classification and strict judicial scrutiny
formulated in Central Bank Employee Association exaggerate the significance of Section 3,
Article XIII is a groundless apprehension. Central Bank applied Article XIII in conjunction
with the equal protection clause. Article XIII, by itself, without the application of the equal
protection clause, has no life or force of its own as elucidated in Agabon.

Along the same line of reasoning, the Court further holds that the subject clause
violates petitioner's right to substantive due process, for it deprives him of property,
consisting of monetary benefits, without any existing valid governmental purpose.[136]

The argument of the Solicitor General, that the actual purpose of the subject clause of
limiting the entitlement of OFWs to their three-month salary in case of illegal dismissal, is
to give them a better chance of getting hired by foreign employers. This is plain
speculation. As earlier discussed, there is nothing in the text of the law or the records of the
deliberations leading to its enactment or the pleadings of respondent that would indicate that
there is an existing governmental purpose for the subject clause, or even just a pretext of one.

The subject clause does not state or imply any definitive governmental purpose; and
it is for that precise reason that the clause violates not just petitioner's right to equal protection,
but also her right to substantive due process under Section 1,[137] Article III of the
Constitution.

The subject clause being unconstitutional, petitioner is entitled to his salaries for the
entire unexpired period of nine months and 23 days of his employment contract, pursuant to
law and jurisprudence prior to the enactment of R.A. No. 8042.

On the Third Issue

 Petitioner contends that his overtime and leave pay should form part of the salary
basis in the computation of his monetary award, because these are fixed benefits that have
been stipulated into his contract.

Petitioner is mistaken.

The word salaries in Section 10(5) does not include overtime and leave pay. For
seafarers like petitioner, DOLE Department Order No. 33, series 1996, provides a Standard
Employment Contract of Seafarers, in which salary is understood as the basic wage,
exclusive of overtime, leave pay and other bonuses; whereas overtime pay is compensation
for all work performed in excess of the regular eight hours, and holiday pay is compensation
for any work performed on designated rest days and holidays.

By the foregoing definition alone, there is no basis for the automatic inclusion of
overtime and holiday pay in the computation of petitioner's monetary award, unless there is
evidence that he performed work during those periods. As the Court held in Centennial
Transmarine, Inc. v. Dela Cruz,[138]
However, the payment of overtime pay and leave pay should be
disallowed in light of our ruling in Cagampan v. National Labor Relations
Commission, to wit:

The rendition of overtime work and the submission of sufficient proof that
said was actually performed are conditions to be satisfied before a seaman could be
entitled to overtime pay which should be computed on the basis of 30% of the basic
monthly salary. In short, the contract provision guarantees the right to overtime pay
but the entitlement to such benefit must first be established.

In the same vein, the claim for the day's leave pay for the unexpired portion of the
contract is unwarranted since the same is given during the actual service of the
seamen.

WHEREFORE, the Court GRANTS the Petition. The subject clause or for three
months for every year of the unexpired term, whichever is less in the 5th paragraph of Section
10 of Republic Act No. 8042 is DECLARED UNCONSTITUTIONAL; and the
December 8, 2004 Decision and April 1, 2005 Resolution of the Court of Appeals
are MODIFIED to the effect that petitioner is AWARDED his salaries for the entire
unexpired portion of his employment contract consisting of nine months and 23 days
computed at the rate of US$1,400.00 per month.

No costs.

SO ORDERED.
CASE#7

Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 154213 August 23, 2012

EASTERN MEDITERRANEAN MARITIME LTD. AND AGEMAR MANNING AGENCY,

INC., Petitioners,
vs.
EST ANISLAO SURIO, FREDDIE PALGUIRAN, GRACIANO MORALES, HENRY
CASTILLO, ARISTOTLE ARREOLA, ALEXANDER YGOT, ANRIQUE BA TTUNG,
GREGORIO ALDOVINO, NARCISO FRIAS, VICTOR FLORES, SAMUEL MARCIAL,
CARLITO PALGUIRAN, DUQUE VINLUAN, .JESUS MENDEGORIN, NEIL FLORES,
ROMEO MANGALIAG, JOE GARFIN and SALESTINO SUSA, Respondents.
*PEREZ

DECISION

BERSAMIN, J.:

On appeal is the decision the Court of Appeals (CA) promulgated on December 21,
2001 affirming the resolution of the National Labor Relations Commission (NLRC)
declaring itself to be without appellate jurisdiction to review the decision of the Philippine
Overseas Employment Administration (POEA) involving petitioners’ complaint for
disciplinary action against respondents.1

Respondents were former crewmembers of MT Seadance, a vessel owned by petitioner

Eastern Mediterranean Maritime Ltd. and manned and operated by petitioner Agemar
Manning Agency, Inc. While respondents were still on board the vessel, they
experienced delays in the payment of their wages and in the remittance of allotments,
and were not paid for extra work and extra overtime work. They complained about the
vessel’s inadequate equipment, and about the failure of the petitioners to heed their
repeated requests for the improvement of their working conditions. On December 19,
1993, when MT Seadance docked at the port of Brofjorden, Sweden to discharge oil,
representatives of the International Transport Federation (ITF) boarded the vessel and
found the wages of the respondents to be below the prevailing rates. The ensuing
negotiations between the ITF and the vessel owner on the increase in respondents’
wages resulted in the payment by the vessel owner of wage differentials and the
immediate repatriation of respondents to the Philippines.

Subsequently, on December 23, 1993, the petitioners filed against the newly-repatriated
respondents a complaint for disciplinary action based on breach of discipline and for the
reimbursement of the wage increases in the Workers Assistance and Adjudication
Office of the POEA.

During the pendency of the administrative complaint in the POEA, Republic Act No.
8042 (Migrant Workers and Overseas Filipinos Act of 1995) took effect on July 15,
1995. Section 10 of Republic Act No. 8042 vested original and exclusive jurisdiction
over all money claims arising out of employer-employee relationships involving
overseas Filipino workers in the Labor Arbiters, to wit:

Section 10. Money Claims. – Notwithstanding any provision of law to the contrary, the
Labor Arbiters of the National Labor Relations Commission (NLRC) shall have the
original and exclusive jurisdiction to hear and decide, within ninety (90) calendar days
after the filing of the complaint, the claims arising out of an employer-employee
relationship or by virtue of any law or contract involving Filipino workers for overseas
deployment including claims for actual, moral, exemplary and other forms of damages.

The jurisdiction over such claims was previously exercised by the POEA under the
POEA Rules and Regulations of 1991 (1991 POEA Rules).

On May 23, 1996, the POEA dismissed the complaint for disciplinary action. Petitioners
received the order of dismissal on July 24, 1996.2

Relying on Section 1, Rule V, Book VII of the 1991 POEA Rules, petitioners filed a
partial appeal on August 2, 1996 in the NLRC, still maintaining that respondents should
be administratively sanctioned for their conduct while they were on board MT
Seadance.

On March 21, 1997, the NLRC dismissed petitioners’ appeal for lack of
jurisdiction,3 thus:

We dismiss the partial appeal.

The Commission has no jurisdiction to review cases decided by the POEA Administrator
involving disciplinary actions. Under the Migrant Workers and Overseas Filipinos Act of
1995, the Labor Arbiter shall have jurisdiction over money claims involving employer-
employee relationship (sec. 10, R.A. 8042). Said law does not provide that appeals from
decisions arising from complaint for disciplinary action rest in the Commission.

PREMISES CONSIDERED, instant appeal from the Order of May 23, 1996 is hereby
DISMISSED for lack of jurisdiction.

SO ORDERED.

Not satisfied, petitioners moved for reconsideration, but the NLRC denied their motion.
They received the denial on July 8, 1997.4

Petitioners then commenced in this Court a special civil action for certiorari and
mandamus. Citing St. Martin Funeral Homes v. National Labor Relations
Commission,5 however, the Court referred the petition to the CA on November 25,
1998.

Petitioners contended in their petition that:

THE NLRC GRAVELY ABUSED ITS DISCRETION AND/OR GRAVELY ERRED IN

DISMISSING PETITIONERS’ APPEAL AND MOTION FOR RECONSIDERATION
WHEN IT REFUSED TO TAKE COGNIZANCE OF PETITIONERS’ APPEAL DESPITE
BEING EMPOWERED TO DO SO UNDER THE LAW.6

On December 21, 2001, the CA dismissed the petition for certiorari and mandamus,
holding that the inclusion and deletion of overseas contract workers from the POEA
blacklist/watchlist were within the exclusive jurisdiction of the POEA to the exclusion of
the NLRC, and that the NLRC had no appellate jurisdiction to review the matter, viz:

Section 10 of RA 8042, otherwise known as the Migrant Workers and Overseas

Filipinos Act of 1995, provides that:

"Money Claims – Notwithstanding any provision of law to the contrary, the Labor
Arbiters of the National Labor Relations Commission (NLRC) shall have the original and
exclusive jurisdiction to hear and decide, within ninety (90) calendar days after the filing
of the complaint, the claims arising out of an employer-employee relationship or by
virtue of any law or contract involving Filipino workers for overseas deployment
including claims for actual, moral, exemplary and other forms of damages.

xxxx
Likewise, the Rules and Regulations implementing RA 8042 reiterate the jurisdiction of
POEA, thus:

"Section 28. Jurisdiction of the POEA. – The POEA shall exercise original and exclusive
jurisdiction to hear and decide:

a) All cases, which are administrative in character, involving or arising out of violations
of rules and regulations relating to licensing and registration of recruitment and
employment agencies or entities; and

b) Disciplinary action cases and other special cases, which are administrative in
character, involving employers, principals, contracting partners and Filipino migrant
workers."

Further, Sections 6 and 7 Rule VII, Book VII of the POEA Rules & Regulations (1991)
provide:

"Sec. 6. Disqualification of Contract Workers. Contract workers, including seamen,

against whom have been imposed or with pending obligations imposed upon them
through an order, decision or resolution shall be included in the POEA Blacklist Workers
shall be disqualified from overseas employment unless properly cleared by the
Administration or until their suspension is served or lifted.

Sec. 7. Delisting of the Contract Worker’s Name from the POEA Watchlist. The name of
an overseas worker may be excluded, deleted and removed from the POEA Watchlist
only after disposition of the case by the Administration."

Thus, it can be concluded from the afore-quoted law and rules that, public respondent
has no jurisdiction to review disciplinary cases decided by the POEA involving contract
workers. Clearly, the matter of inclusion and deletion of overseas contract workers in
the POEA Blacklist/Watchlist is within the exclusive jurisdiction of the POEA to the
exclusion of the public respondent. Nor has the latter appellate jurisdiction to review the
findings of the POEA involving such cases.

xxx

In fine, we find and so hold, that, no grave abuse of discretion can be imputed to the
public respondent when it issued the assailed Decision and Order, dated March 21,
1997 and June 13, 1997, respectively, dismissing petitioners’ appeal from the decision
of the POEA.

WHEREFORE, finding the instant petition not impressed with merit, the same is hereby
DENIED DUE COURSE. Costs against petitioners.

SO ORDERED.7

Issue

Petitioners still appeal, submitting to the Court the sole issue of:

WHETHER OR NOT THE NLRC HAS JURISDICTION TO REVIEW ON APPEAL

CASES DECIDED BY THE POEA ON MATTERS PERTAINING TO DISCIPLINARY
ACTIONS AGAINST PRIVATE RESPONDENTS.

They contend that both the CA and the NLRC had no basis to rule that the NLRC had
no jurisdiction to entertain the appeal only because Republic Act No. 8042 had not
provided for its retroactive application.

Respondents counter that the appeal should have been filed with the Secretary of Labor
who had exclusive jurisdiction to review cases involving administrative matters decided
by the POEA.
 Ruling

The petition for review lacks merit.

Petitioners’ adamant insistence that the NLRC should have appellate authority over the
POEA’s decision in the disciplinary action because their complaint against respondents
was filed in 1993 was unwarranted. Although Republic Act No. 8042, through its Section
10, transferred the original and exclusive jurisdiction to hear and decide money claims
involving overseas Filipino workers from the POEA to the Labor Arbiters, the law did not
remove from the POEA the original and exclusive jurisdiction to hear and decide all
disciplinary action cases and other special cases administrative in character involving
such workers. The obvious intent of Republic Act No. 8042 was to have the POEA focus
its efforts in resolving all administrative matters affecting and involving such workers.
This intent was even expressly recognized in the Omnibus Rules and Regulations
Implementing the Migrant Workers and Overseas Filipinos Act of 1995 promulgated on
February 29, 1996, viz:

Section 28. Jurisdiction of the POEA. – The POEA shall exercise original and exclusive
jurisdiction to hear and decide:

(a) all cases, which are administrative in character, involving or arising out of violations
or rules and regulations relating to licensing and registration of recruitment and
employment agencies or entities; and

(b) disciplinary action cases and other special cases, which are administrative in
character, involving employers, principals, contracting partners and Filipino migrant
workers.

Section 29. Venue – The cases mentioned in Section 28(a) of this Rule, may be filed
with the POEA Adjudication Office or the DOLE/POEA regional office of the place where
the complainant applied or was recruited, at the option of the complainant. The office
with which the complaint was first filed shall take cognizance of the case.

Disciplinary action cases and other special cases, as mentioned in the preceding
Section, shall be filed with the POEA Adjudication Office.

It is clear to us, therefore, that the NLRC had no appellate jurisdiction to review the
decision of the POEA in disciplinary cases involving overseas contract workers.

Petitioners’ position that Republic Act No. 8042 should not be applied retroactively to
the review of the POEA’s decision dismissing their complaint against respondents has
no support in jurisprudence. Although, as a rule, all laws are prospective in application
unless the contrary is expressly provided,8 or unless the law is procedural or curative in
nature,9 there is no serious question about the retroactive applicability of Republic Act
No. 8042 to the appeal of the POEA’s decision on petitioners’ disciplinary action against
respondents. In a way, Republic Act No. 8042 was a procedural law due to its providing
or omitting guidelines on appeal. A law is procedural, according to De Los Santos v.
Vda. De Mangubat,10 when it –

Refers to the adjective law which prescribes rules and forms of procedure in order that
courts may be able to administer justice. Procedural laws do not come within the legal
conception of a retroactive law, or the general rule against the retroactive operation of
statues ― they may be given retroactive effect on actions pending and undetermined at
the time of their passage and this will not violate any right of a person who may feel that
he is adversely affected, insomuch as there are no vested rights in rules of procedure.

Republic Act No. 8042 applies to petitioners’ complaint by virtue of the case being then
still pending or undetermined at the time of the law’s passage, there being no vested
rights in rules of procedure.11 They could not validly insist that the reckoning period to
ascertain which law or rule should apply was the time when the disciplinary complaint
was originally filed in the POEA in 1993. Moreover, Republic Act No. 8042 and its
implementing rules and regulations were already in effect when petitioners took their
appeal. A statute that eliminates the right to appeal and considers the judgment
rendered final and unappealable only destroys the right to appeal, but not the right to
prosecute an appeal that has been perfected prior to its passage, for, at that stage, the
right to appeal has already vested and cannot be impaired. 12 Conversely and by
analogy, an appeal that is perfected when a new statute affecting appellate jurisdiction
comes into effect should comply with the provisions of the new law, unless otherwise
provided by the new law. Relevantly, petitioners need to be reminded that the right to
appeal from a decision is a privilege established by positive laws, which, upon
authorizing the taking of the appeal, point out the cases in which it is proper to present
the appeal, the procedure to be observed, and the courts by which the appeal is to be
proceeded with and resolved.13 This is why we consistently hold that the right to appeal
is statutory in character, and is available only if granted by law or statute. 14

When Republic Act No. 8042 withheld the appellate jurisdiction of the NLRC in respect
of cases decided by the POEA, the appellate jurisdiction was vested in the Secretary of
Labor in accordance with his power of supervision and control under Section 38(1),
Chapter 7, Title II, Book III of the Revised Administrative Code of 1987, to wit:

Section 38. Definition of Administrative Relationship. – Unless otherwise expressly

stated in the Code or in other laws defining the special relationships of particular
agencies, administrative relationships shall be categorized and defined as follows:

Supervision and Control. – Supervision and control shall include authority to act directly
whenever a specific function is entrusted by law or regulation to a subordinate; direct
the performance of duty; restrain the commission of acts; review, approve, reverse or
modify acts and decisions of subordinate officials or units; determine priorities in the
execution of plans and programs. Unless a different meaning is explicitly provided in the
specific law governing the relationship of particular agencies, the word "control" shall
encompass supervision and control as defined in this paragraph. xxx.

Thus, Section 1, Part VII, Rule V of the 2003 POEA Rules and Regulations specifically
provides, as follows:

Section 1. Jurisdiction. – The Secretary shall have the exclusive and original jurisdiction
to act on appeals or petition for review of disciplinary action cases decided by the
Administration.

In conclusion, we hold that petitioners should have appealed the adverse decision of the
POEA to the Secretary of Labor instead of to the NLRC. Consequently, the CA, being
correct on its conclusions, committed no error in upholding the NLRC.

WHEREFORE, we AFFIRM the decision promulgated on December 21, 2001 by the

Court of Appeals; andORDER the petitioners to pay the costs of suit.

SO ORDERED.
CASE#8

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 109808 March 1, 1995

ESALYN CHAVEZ, petitioner,

vs.
HON. EDNA BONTO-PEREZ, HON. ROGELIO T. RAYALA, HON. DOMINGO H.
ZAPANTA, HON. JOSE N. SARMIENTO, CENTRUM PROMOTIONS PLACEMENT
CORPORATION, JOSE A. AZUCENA, JR., and TIMES SURETY & INSURANCE
COMPANY, INC. respondents.

PUNO, J.:

One of the anguished cries in our society today is that while our laws appear to protect
the poor, their interpretation is sometimes anti-poor. In the case at bench, petitioner, a
poor, uncounselled entertainment dancer signed a contract with her Japanese employer
calling for a monthly salary of One Thousand Five Hundred U.S. Dollars (US$1,500) but
later had to sign an immoral side agreement reducing her salary below the minimum
standard set by the POEA. Petitioner invoked the law to collect her salary differentials,
but incredibly found public respondent straining the seams of our law to disfavor her.
There is no greater disappointment to the poor like petitioner than to discover the ugly
reality behind the beautiful rhetoric of laws. We will not allow this travesty.

This is a petition for certiorari to review the Decision of the National Labor Relations
Commission (NLRC), 1 dated December 29, 1992, which affirmed the Decision of public
respondent Philippine Overseas Employment Agency (POEA) Administrator Jose N.
Sarmiento, dated February 17, 1992, dismissing petitioner's complaint for unpaid
salaries amounting to Six Thousand Dollars (US$6,000.00).

The facts are undisputed.

On December 1, 1988, petitioner, an entertainment dancer, entered into a standard

employment contract for overseas Filipino artists and entertainers with Planning Japan
Co., Ltd., 2 through its Philippine representative, private respondent Centrum Placement
& Promotions Corporation. The contract had a duration of two (2) to six (6) months, and
petitioner was to be paid a monthly compensation of One Thousand Five Hundred
Dollars (US$1,5000.00). On December 5, 1888, the POEA approved the contract.
Subsequently, petitioner executed the following side agreement with her Japanese
employer through her local manager, Jaz Talents Promotion:

Date: Dec. 10, 1988

SUBJECT: Salary Deduction

MANAGERIAL COMMISSION

DATE OF DEPARTURE: _________________

ATTENTION: MR. IWATA

 I, ESALYN CHAVEZ, DANCER, do hereby with my own free will and
voluntarily have the honor to authorize your good office to please deduct
the amount of TWO HUNDRED FIFTY DOLLARS ($250) from my
contracted monthly salary of SEVEN HUNDRED FIFTY DOLLARS
($750) as monthly commission for my Manager, Mr. Jose A. Azucena, Jr.

That, my monthly salary (net) is FIVE HUNDRED DOLLARS ($500).

(sgd. by petitioner) 3

On December 16, 1988, petitioner left for Osaka, Japan, where she worked for six (6)
months, until June 10, 1989. She came back to the Philippines on June 14, 1989.

Petitioner instituted the case at bench for underpayment of wages with the POEA on
February 21, 1991. She prayed for the payment of Six Thousand U.S. Dollars
(US$6,000.00), representing the unpaid portion of her basic salary for six months.
Charged in the case were private respondent Centrum Promotions and Placement
Corporation, the Philippine representative of Planning Japan, Co., Inc., its insurer,
Times Surety and Insurance Co., Inc., and Jaz Talents Promotion.

The complaint was dismissed by public respondent POEA Administrator on February

17, 1992. He ratiocinated, inter alia:

. . . Apparently and from all indications, complainant (referring to petitioner

herein) was satisfied and did not have any complaint (about) anything
regarding her employment in Japan until after almost two (2) years (when)
she filed the instant complaint on February 21, 1991. The records show
that after signing the Standard Employment Contract on December 1,
1988, she entered into a side agreement with the Japanese employer thru
her local manager, Jaz Talents Promotion consenting to a monthly salary
of US$750.00 which she affirmed during the conference of May 21, 1991.
Respondent agency had no knowledge nor participation in the said
agreement such that it could not be faulted for violation of the Standard
Employment Contract regarding the stipulated salary. We cannot take
cognizance of such violation when one of the principal party (sic) thereto
opted to receive a salary different from what has been stipulated in their
contract, especially so if the contracting party did not consent/participate in
such arrangement. Complainant (petitioner) cannot now demand from
respondent agency to pay her the salary based (on) the processed
Employment Contract for she is now considered in bad faith and hence,
estopped from claiming thereto thru her own act of consenting and
agreeing to receive a salary not in accordance with her contract of
employment. Moreover, her self-imposed silence for a long period of time
worked to her own disadvantage as she allowed laches to prevail which
barred respondent from doing something at the outset. Normally, if a
person's right (is) violated, she/he would immediately react to protect
her/his rights which is not true in the case at bar.

The term laches has been defined as one's negligence or failure to assert
his right in due time or within reasonable time from the accrual of his
cause of action, thus, leading another party to believe that there is nothing
wrong with his own claim. This resulted in placing the negligent party in
estoppel to assert or enforce his right. . . . Likewise, the Supreme Court in
one case held that not only is inaction within reasonable time to enforce a
right the basic premise that underlies a valid defense of laches but such
inaction evinces implied consent or acquiescence to the violation of the
right . . .

Under the prevailing circumstances of this case, it is outside the regulatory

powers of the Administration to rule on the liability of respondent Jaz
Talents Promotions, if any, (it) not being a licensed private agency but a
promotion which trains entertainers for abroad.
 xxx xxx xxx

(Citations omitted.)

On appeal, the NLRC upheld the Decision, thus:

We fail to see any conspiracy that the complainant (petitioner herein)

imputes to the respondents. She has, to put it bluntly, not established
and/or laid the basis for Us to arrive at a conclusion that the respondents
have been and should be held liable for her claims.

The way We see it, the records do not at all indicate any connection
between respondents Centrum Promotion & Placement Corporation and
Jaz Talents Promotion.

There is, therefore, no merit in the appeal. Hence, We affirmed. 4

Dissatisfied with the NLRC's Decision, petitioner instituted the present petition, alleging
that public respondents committed grave abuse of discretion in finding: that she is guilty
of laches; that she entered into a side contract on December 10, 1988 for the reduction
of her basic salary to Seven Hundred Fifty U.S. Dollars (US$750.00) which superseded,
nullified and invalidated the standard employment contract she entered into on
December 1, 1988; and that Planning Japan Co., Ltd. and private respondents are not
solidarily liable to her for Six Thousand US Dollars (US$6,000.00) in unpaid wages. 5

The petition is meritorious.

Firstly, we hold that the managerial commission agreement executed by petitioner to

authorize her Japanese Employer to deduct Two Hundred Fifty U.S. Dollars
(US$250.00) from her monthly basic salary is void because it is against our existing
laws, morals and public policy. It cannot supersede the standard employment contract
of December 1, 1988 approved by the POEA with the following stipulation appended
thereto:

It is understood that the terms and conditions stated in this Employment

Contract are in conformance with the Standard Employment Contract for
Entertainers prescribed by the POEA under Memorandum Circular No. 2,
Series of 1986. Any alterations or changes made in any part of this
contract without prior approval by the POEA shall be null and
void; 6 (Emphasis supplied.)

The stipulation is in line with the provisions of Rule II, Book V and Section 2(f), Rule I,
Book VI of the 1991 Rules and Regulations Governing Overseas Employment, thus:

Book V, Rule II

Sec. 1. Employment Standards. The Administration shall determine,

formulate and review employment standards in accordance with the
market development and welfare objectives of the overseas employment
program and the prevailing market conditions.

Sec. 2. Minimum Provisions for Contract. The following shall be

considered the minimum requirements for contracts of employment:

a. Guaranteed wages for regular working hours and overtime

pay for services rendered beyond regular working hours in
accordance with the standards established by the
Administration;

xxx xxx xxx

 Sec. 3. Standard Employment Contract. The administration shall
undertake development and/or periodic review of region, country and skills
specific employment contracts for landbased workers and conduct regular
review of standard employment contracts (SEC) for seafarers. These
contracts shall provide for minimum employment standards herein
enumerated under Section 2, of this Rule and shall recognize the
prevailing labor and social legislations at the site of employment and
international conventions. The SEC shall set the minimum terms and
conditions of employment. All employers and principals shall adopt the
SEC in connection with the hiring of workers without prejudice to their
adoption of other terms and conditions of employment over and above the
minimum standards of the Administration. (Emphasis supplied.)

and

BOOK VI, RULE I

Sec. 2. Grounds for suspension/cancellation of license.

xxx xxx xxx

f. Substituting or altering employment contracts and other documents

approved and verified by the Administration from the time of actual signing
thereof by the parties up to and including the period of expiration of the
same without the Administration's approval.

xxx xxx xxx

(Emphasis supplied.)

Clearly, the basic salary of One Thousand Five Hundred U.S. Dollars (US$1,500.00)
guaranteed to petitioner under the parties' standard employment contract is in
accordance with the minimum employment standards with respect to wages set by the
POEA, Thus, the side agreement which reduced petitioner's basic wage to Seven
Hundred Fifty U.S. Dollars (US$750.00) is null and void for violating the POEA's
minimum employment standards, and for not having been approved by the POEA.
Indeed, this side agreement is a scheme all too frequently resorted to by unscrupulous
employers against our helpless overseas workers who are compelled to agree to satisfy
their basic economic needs.

Secondly. The doctrine of laches or "stale demands"' cannot be applied to petitioner.

Laches has been defined as the failure or neglect for an unreasonable and
unexplained length time to do that which, by exercising due diligence, could or should
have been done earlier, 7 thus giving rise to a presumption that the party entitled to
assert it either has abandoned or declined to assert it. 8 It is not concerned with mere
lapse of time; the fact of delay, standing alone, is insufficient to constitute laches. 9

The doctrine of laches is based upon grounds of public policy which requires, for the
peace of society, the discouragement of stale claims, and is principally a question of the
inequity or unfairness of permitting a right or claim to be enforced or asserted. 10 There
is no absolute rule as to what constitutes laches; each case is to be determined
according to its particular circumstances. The question of laches is addressed to the
sound discretion of the court, and since it is an equitable doctrine, its application is
controlled by equitable considerations. It cannot be worked to defeat justice or to
perpetrate fraud and injustice. 11

In the case at bench, petitioner filed her claim well within the three-year prescriptive
period for the filing of money claims set forth in Article 291 of the Labor Code. 12 For this
reason, we hold the doctrine of laches inapplicable to petitioner. As we ruled in Imperial
Victory Shipping Agency v. NLRC, 200 SCRA 178 (1991):
 . . . Laches is a doctrine in equity while prescription is based on law. Our
courts are basically courts of law not courts of equity. Thus, laches cannot
be invoked to resist the enforcement of an existing legal right. We have
ruled in Arsenal v. Intermediate Appellate Court . . . that it is a long
standing principle that equity follows the law. Courts exercising equity
jurisdiction are bound by rules of law and have no arbitrary discretion to
disregard them. In Zabat, Jr. v. Court of Appeals . . ., this Court was more
emphatic upholding the rules of procedure. We said therein:

As for equity, which has been aptly described as a "justice

outside legality," this applied only in the absence of, and
never against, statutory law or, as in this case, judicial rules
of procedure. Aequetas nunguam contravenit legis. The
pertinent positive rules being present here, they should pre-
empt and prevail over all abstract arguments based only on
equity.

Thus, where the claim was filed within the three-year statutory period,
recovery therefore cannot be barred by laches. Courts should never apply
the doctrine of laches earlier than the expiration of time limited for the
commencement of actions at law.

xxx xxx xxx

(Emphasis supplied. Citations omitted.)

Thirdly, private respondents Centrum and Times as well as Planning Japan Co., Ltd. —
the agency's foreign principal — are solidarily liable to petitioner for her unpaid wages.
This is in accordance with stipulation 13.7 of the parties' standard employment contract
which provides:

13.7. The Employer (in this case, Planning Japan Co., Ltd. ) and its locally
(sic) agent/promoter/representative (private respondent Centrum
Promotions & Placement Corporation) shall be jointly and
severally responsible for the proper implementation of the terms and
conditions in this Contract. 13 (Emphasis supplied.)

This solidary liability also arises from the provisions of Section 10(a)(2), Rule V,
Book I of the Omnibus Rules Implementing the Labor Code, as amended, thus:

Sec. 10. Requirement before recruitment. — Before recruiting any worker,

the private employment agency shall submit to the Bureau the following
documents:

a) A formal appointment or agency contract executed by a foreign-based

employer in favor of the license holder to recruit and hire personnel for the
former . . . . Such formal appointment or recruitment agreement shall
contain the following provisions, among others:

xxx xxx xxx

2. Power of the agency to sue and be sued jointly and solidarily with the
principal or foreign based employer for any of the violations of the
recruitment agreement and the contracts of employment.

xxx xxx xxx

(Emphasis supplied.)

Our overseas workers constitute an exploited class. Most of them come from the
poorest sector of our society. They are thoroughly disadvantaged. Their profile shows
they live in suffocating slums, trapped in an environment of crime. Hardly literate and in
ill health, their only hope lies in jobs they can hardly find in our country. Their
unfortunate circumstance makes them easy prey to avaricious employers. They will
climb mountains, cross the seas, endure slave treatment in foreign lands just to survive.
Out of despondence, they will work under sub-human conditions and accept salaries
below the minimum. The least we can do is to protect them with our laws in our land.
Regretfully, respondent public officials who should sympathize with the working class
appear to have a different orientation.

IN VIEW WHEREOF, the petition is GRANTED. The Decisions of respondent POEA

Administrator and NLRC Commissioners in POEA Case No. Adj. 91-02-199 (ER),
respectively dated February 17 and December 29, 1992, and the Resolution of the
NLRC, dated March 23, 1993, are REVERSED and SET ASIDE. Private respondents
are held jointly and severally liable to petitioner for the payment of SIX THOUSAND US
DOLLARS (US$6,000.00) in unpaid wages. Costs against private respondents.

SO ORDERED.

Narvasa, C.J., Bidin, Regalado and Mendoza, JJ., concur.

CASE#9

Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 195668 June 25, 2014

PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee,

vs.
MA. HARLETA VELASCO y BRIONES, MARICAR B. INOVERO, MARISSA DIALA,
and BERNA M. PAULINO, Accused,

MARICAR B. INOVERO, Accused-Appellant.

DECISION

BERSAMIN, J.:

The several accused in illegal recruitment committed in large scale against whom the
State establishes a conspiracy are each equally criminally and civilly liable. It follows,
therefore, that as far as civil liability is concerned each is solidarily liable to the victims of
the illegal recruitment for the reimbursement of the sums collected from them,
regardless of the extent of the participation of the accused in the illegal recruitment.

The Case

Accused-appellant Maricar B. Inovero seeks the review and reversal of the decision
promulgated on August 26, 2010,1 whereby the Court of Appeals (CA) affirmed her
conviction for illegal recruitment committed in large scale amounting to economic
sabotage under the judgment rendered on January 14, 2008 by the Regional Trial Court
(RTC), Branch 133, in Makati City.2

Antecedents

On March 17, 2004, the Office of the City Prosecutor of Makati City filed in the RTC two
informations3 charging Inovero, Ma. Harleta Velasco y Briones, Marissa Diala and
Berna Paulino with illegal recruitment as defined and penalized under Section 6 of
Republic Act No. 8042 (Migrant Worker’s Act of 1995), and 11 informations 4charging
the same accused with estafa as defined and penalized under Article315, paragraph
2(a) of the Revised Penal Code. Only Inovero was arrested and prosecuted, the other
accused having remained at large.

Six cases charging estafa (Criminal Case No. 04-1565, Criminal Case No. 1568,
Criminal Case No. 1570, Criminal Case No. 1571 and Criminal Case No. 1572 and
Criminal Case No. 1573) and one of the two charging illegal recruitment (Criminal Case
No. 04-1563) were provisionally dismissed because of the failure of the complainants to
prosecute.5 The seven cases were later permanently dismissed after the complainants
did not revive them within two years, as provided in Section 8,6 Rule 117 of the Rules of
Court.

Trial on the merits ensued as to the remaining cases (Criminal Case No. 04-1562, for
illegal recruitment; and Criminal Case No. 04-1564; Criminal Case No. 04-1566;
Criminal Case No. 04-1567; Criminal Case No. 1569 and Criminal Case No. 04-1574,
for estafa).7

The CA recounted the transactions between the complainants and the accused,
including Inovero, in the following manner:
Regarding Criminal Case No. 04-1562, the prosecution presented the five (5) private
complainants as witnesses to prove the crime of Illegal Recruitment, namely: Novesa
Baful ("Baful"), Danilo Brizuela ("Brizuela"), Rosanna Aguirre ("Aguirre"), Annaliza
Amoyo ("Amoyo"), and Teresa Marbella ("Marbella"), and Mildred Versoza ("Versoza")
from the Philippine Overseas Employment Administration ("POEA").

Baful testified that on May 20, 2003 she, together with her sister-in-law, went to Harvel
International Talent Management and Promotion ("HARVEL") at Unit 509 Cityland
Condominium, Makati City upon learning that recruitment for caregivers to Japan was
on-going there. On said date, she allegedly met Inovero; Velasco, and Diala, and saw
Inovero conducting a briefing on the applicants. She also testified that Diala, the alleged
talent manager, directed her to submit certain documents, and to pay Two Thousand
Five Hundred Pesos (P2,500.00) as training fee, as well as Thirty Thousand Pesos
(P30,000.00) as placement and processing fees. Diala also advised her to undergo
physical examination.

On June 6, 2003, after complying with the aforesaid requirements and after paying Diala
the amounts of Eighteen Thousand Pesos (P18,000.00) and Ten Thousand pesos
(P10,000.00), Baful was promised deployment within two (2) to three (3) months. She
likewise testified that Inovero briefed her and her co-applicants on what to wear on the
day of their departure. However, she was never deployed. Finally, she testified that she
found out that HARVEL was not licensed to deploy workers for overseas employment.

Brizuela, another complainant, testified that he went to HARVEL’s office in Makati on

February 7, 2003 to inquire on the requirements and hiring procedure for a caregiver in
Japan. There, Diala told him the amount required as processing fee and the documents
to be submitted. And when he submitted on March 7, 2003 the required documents and
payments, it was, this time, Paulino who received them. He claimed that he underwent
training and medical examination; he likewise attended an orientation conducted by
Inovero at which time, he and his batchmates were advised what clothes to wear on the
day of their departure; he was assured of deployment on the first week of June 2003,
however, on the eve of his supposed "pre-departure orientation seminar," Paulino
texted him that the seminar was cancelled because Inovero, who had the applicants’
money, did not show up. He testified that he was not deployed. Neither was his money
returned, as promised.

On cross-examination, Brizuela testified that Inovero was the one who conducted the
orientation, and represented to all the applicants that most of the time, she was in the
Japanese Embassy expediting the applicants’ visa.

Aguirre, the third complainant to testify, alleged that she went to HARVEL on May 22,
2003, to apply as caregiver in Japan; there, Diala informed her that Inovero was oneof
the owners of HARVEL and Velasco was its President; she paid Thirty Five Thousand
Pesos (P35,000.00), and submitted her documents, receipt of which was acknowledged
by Diala; despite her undergoing medical examination and several training seminars,
she was however not deployed to Japan. Worse, she found out that HARVEL was not
licensed to recruit workers.

Amoyo, the fourth complainant, testified that she went to HARVEL’s office on May 28,
2003 to apply as caregiver in Japan, and Diala required her to submit certain
documents, to undergo training and medical examination, and to pay Thirty Five
Thousand Pesos (P35,000.00) as placement and processing fees. However, after
complying with said requirements, she was never deployed as promised.

Marbella was the last complainant to testify. She alleged that she applied for the
position of janitress at HARVEL sometime in December 2002; just like the rest of the
complainants, she was required to submit certain documents and to pay a total amount
of Twenty Thousand pesos (P20,000.00) as processing fee; after paying said fee, Diala
and Inovero promised her and the other applicants that they will be deployed in three (3)
months or in June 2003; however, the promised deployment never materialized; she
later found out that HARVEL was not even licensed to recruit workers.
[Mildred] Versoza, on the other hand, is a Labor and Employment Officer at the POEA
Licensing Branch. She testified that she prepared a Certification certifying that neither
HARVEL nor Inovero was authorized to recruit workers for overseas employment as per
records at their office.

In her defense, Inovero denied the allegations hurled against her. As summarized in the
assailed Decision, she claimed that she is the niece of accused Velasco, the owner of
HARVEL, but denied working there. Explaining her presence in HARVEL, she alleged
that she worked for her uncle, Velasco’s husband, as an office assistant, hence, for at
least two or three times a week, she had to go to HARVEL on alleged errands for her
uncle. She also testified that her alleged errands mainly consisted of serving food and
refreshments during orientations at HARVEL. Inovero likewise denied receiving any
money from the complainants, nor issuing receipts therefor.8

Judgment of the RTC

On January 14, 2008, the RTC rendered judgment acquitting Inovero of five counts of
estafabut convicting her in Criminal Case No. 04-1562 of illegal recruitment committed
in large scale as defined and penalized by Section 6 and Section 7 of Republic Act No.
8042 (Migrant Workers and Overseas Filipinos Act of 1995), disposing thusly:

WHEREFORE, judgment is hereby rendered in the aforestated cases as follows:

In Criminal Case No. 04-1562, accused Maricar Inovero is found guilty beyond
reasonable doubt of the crime of Illegal Recruitment in large scale defined and
penalized under Sections 6 and 7, II, of Republic Act No. 8042 otherwise known as the
‘Migrant Workers and Overseas Filipinos Act of 1995’, and is hereby sentenced to suffer
the penalty of life imprisonment. She is likewise ordered to pay a fine of Five Hundred
Thousand Pesos (P500,000.00).

Criminal Case No. 04-1563 also for illegal recruitment in large scale is hereby ordered
dismissed to its finality for failure of complainants Alvin De Leon, Roderick Acuna,
Agosto Vale and Marina Viernes to revive said case despite the lapse of two years from
its provisional dismissal.

Criminal Cases No. 04-1564, 1566, 1567, 1569, 1571 and 1574 are hereby ordered
DISMISSED for failure of the prosecution to adduce sufficient evidence to prove all the
elements of the said offense.

Criminal Cases Nos. 1565, 1568, 1570, 1572 and 1573 also for estafa [are] hereby
ordered dismissed to its finality for failure of complainants Agosto Vale, Alvin De Leon,
Roselyn Saruyda, Roderick Acuna and Marina Viernes to revive said cases despite the
lapse of two (2) years from its provisional dismissal.

Considering that the accused is a detention prisoner, she shall be credited in the service
of her sentence with the full time during which she has undergone preventive
imprisonment if she agrees voluntarily to abide by the same disciplinary rules imposed
upon convicted prisoners, otherwise, with four-fifths thereof.

Meanwhile, considering that the accused Ma. Harleta B. Velasco, Marissa Diala and
Berna Paulino are still at large, let alias warrants of arrest be issued against them. In the
meantime, let the cases filed against them be archived, which shall be revived upon
their apprehension.

SO ORDERED.9

Decision of the CA

Inovero appealed, contending that:

THE TRIAL COURT GRAVELY ERRED IN FINDING ACCUSEDAPPELLANT GUILTY
OF THE CRIME CHARGED DESPITE THE PROSECUTION’S FAILURE TO
ESTABLISH [HER] GUILT BEYOND REASONABLE DOUBT.10

On August 26, 2010, the CA affirmed the conviction, viz:

WHEREFORE, the instant appeal is DISMISSED. The January 14, 2008 Decision of the
RTC is AFFIRMED.

SO ORDERED.11

Issue

In this appeal, Inovero insists that the CA erred in affirming her conviction by the RTC
because she had not been an employee of Harvel at any time; that she could be faulted
only for her association with the supposed illegal recruiters; that in all stages of the
complainants’ recruitment for overseas employment by Harvel, they had transacted only
and directly with Diala; and that the certification from the POEA to the effect she was
not a licensed recruiter was not a positive proof that she engaged in illegal recruitment.

Ruling of the Court

The appeal lacks merit.

In its assailed decision, the CA affirmed the entire findings of fact of the RTC, stating:

The essential elements of illegal recruitment committed in large scale are: (1) that the
accused engaged in acts of recruitment and placement of workers as defined under
Article 13(b) of the Labor Code, or in any prohibited activities under Article 34 of the
same Code; (2) that the accused had not complied with the guidelines issued by the
Secretary of Labor and Employment with respect to the requirement to secure a license
or authority to recruit and deploy workers; and (3) that the accused committed the
unlawful acts against 3 or more persons. In simplest terms, illegal recruitment is
committed by persons who, without authority from the government, give the impression
that they have the power to send workers abroad for employment purposes. In Our
view, despite Inovero’s protestations that she did not commit illegal recruitment, the
following circumstances contrarily convince Us that she was into illegal recruitment.

First, private complainants Baful and Brizuela commonly testified that Inovero was the
one who conducted orientations/briefings on them; informed them, among others, on
how much their salary would be as caregivers in Japan; and what to wear when they
finally will be deployed. Second, when Diala introduced her (Inovero) to private
complainant Amoyo as one of the owners of HARVEL, Inovero did not bother to correct
said representation. Inovero’s silence is clearly an implied acquiescence to said
representation.

Third, Inovero, while conducting orientation on private complainant Brizuela,

represented herself as the one expediting the release of applicants’ working visa for
Japan.

Fourth, in a Certification issued and attested to by POEA’s Versoza – Inovero had no

license nor authority to recruit for overseas employment.

Based on the foregoing, there is therefore no doubt that the RTC correctly found that
Inovero committed illegal recruitment in large scale by giving private complainants the
impression that she can send them abroad for employment purposes, despite the fact
that she had no license or authority to do so.12

It is basic that the Court, not being a trier of facts, must of necessity rely on the findings
of fact by the trial court which are conclusive and binding once affirmed by the CA on
intermediate review. The bindingness of the trial court’s factual findings is by virtue of its
direct access to the evidence. The direct access affords the trial court the unique
advantage to observe the witnesses’ demeanor while testifying, and the personal
opportunity to test the accuracy and reliability of their recollections of past events, both
of which are very decisive in a litigation like this criminal prosecution for the serious
crime of illegal recruitment committed in large scale where the parties have disagreed
on the material facts. The Court leaves its confined precinct of dealing only with legal
issues in order to deal with factual ones only when the appellant persuasively
demonstrates a clear error in the appreciation of the evidence by both the trial and the
appellate courts. This demonstration was not done herein by the appellant. Hence, the
Court upholds the CA’s affirmance of the factual findings by the trial court.

All that Inovero’s appeal has offered was her denial of complicity in the illegal
recruitment of the complainants. But the complainants credibly described and affirmed
her specific acts during the commission of the crime of illegal recruitment. Their positive
assertions were far trustworthier than her mere denial.

Denial, essentially a negation of a fact, does not prevail over an affirmative assertion of
the fact.1âwphi1 Thus, courts – both trial and appellate – have generally viewed the
defense of denial in criminal cases with considerable caution, if not with outright
rejection. Such judicial attitude comes from the recognition that denial is inherently weak
and unreliable by virtue of its being an excuse too easy and too convenient for the guilty
to make. To be worthy of consideration at all, denial should be substantiated by clear
and convincing evidence. The accused cannot solely rely on her negative and self-
serving negations, for denial carries no weight in law and has no greater evidentiary
value than the testimony of credible witnesses who testify on affirmative matters. 13 It is
no different here.

We concur with the RTC and the CA that Inovero was criminally liable for the illegal
recruitment charged against her. Strong and positive evidence demonstrated beyond
reasonable doubt her having conspired with her co-accused in the recruitment of the
complainants. The decision of the CA amply recounted her overt part in the conspiracy.
Under the law, there is a conspiracy when two or more persons come to an agreement
concerning the commission of a felony, and decide to commit it.14

The complainants paid varying sums for placement, training and processing fees,
respectively as follows: (a) Baful – P28,500.00; (b) Brizuela – P38,600.00; (c) Aguirre
– P38,600.00; (d) Amoyo – P39,000.00; and (e) Marbella – P20,250.00. However, the
RTC and the CA did not adjudicate Inovero’s personal liability for them in their
judgments. Their omission needs to be corrected, notwithstanding that the complainants
did not appeal, for not doing so would be patently unjust and contrary to law. The Court,
being the ultimate reviewing tribunal, has not only the authority but also the duty to
correct at any time a matter of law and justice. It is, indeed, a basic tenet of our criminal
law that every person criminally liable is also civilly liable.15 Civil liability includes
restitution, reparation of the damage caused, and indemnification for consequential
damages.16 To enforce the civil liability, the Rules of Court has deemed to be instituted
with the criminal action the civil action for the recovery of civil liability arising from the
offense charged unless the offended party waives the civil action, or reserves the right
to institute the civil action separately, or institutes the civil action prior to the criminal
action.17 Considering that the crime of illegal recruitment, when it involves the transfer of
funds from the victims to the accused, is inherently in fraud of the former, civil liability
should include the return of the amounts paid as placement, training and processing
fees.18 Hence, Inovero and her co-accused were liable to indemnify the complainants
for all the sums paid.

That the civil liability should be made part of the judgment by the RTC and the CA was
not disputable. The Court pointed out in Bacolod v. People19 that it was "imperative that
the courts prescribe the proper penalties when convicting the accused, and determine
the civil liability to be imposed on the accused, unless there has been a reservation of
the action to recover civil liability or a waiver of its recovery," because:

It is not amiss to stress that both the RTC and the CA disregarded their express
mandate under Section 2, Rule 120 of the Rules of Court to have the judgment, if it was
of conviction, state: "(1) the legal qualification of the offense constituted by the acts
committed by the accused and the aggravating or mitigating circumstances which
attended its commission; (2) the participation of the accused in the offense, whether as
principal, accomplice, or accessory after the fact; (3) the penalty imposed upon the
accused; and (4) the civil liability or damages caused by his wrongful act or omission to
be recovered from the accused by the offended party, if there is any, unless the
enforcement of the civil liability by a separate civil action has been reserved or waived."
Their disregard compels us to act as we now do lest the Court be unreasonably seen as
tolerant of their omission. That the Spouses Cogtas did not themselves seek the
correction of the omission by an appeal is no hindrance to this action because the
Court, as the final reviewing tribunal, has not only the authority but also the duty to
correct at any time a matter of law and justice.

We also pointedly remind all trial and appellate courts to avoid omitting reliefs that the
parties are properly entitled to by law or in equity under the established facts. Their
judgments will not be worthy of the name unless they thereby fully determine the rights
and obligations of the litigants. It cannot be otherwise, for only by a full determination of
such rights and obligations would they be true to the judicial office of administering
justice and equity for all. Courts should then be alert and cautious in their rendition of
judgments of conviction in criminal cases. They should prescribe the legal penalties,
which is what the Constitution and the law require and expect them to do. Their
prescription of the wrong penalties will be invalid and ineffectual for being done without
jurisdiction or in manifest grave abuse of discretion amounting to lack of jurisdiction.
They should also determine and set the civil liability ex delicto of the accused, in order
to do justice to the complaining victims who are always entitled to them. The Rules of
Court mandates them to do so unless the enforcement of the civil liability by separate
actions has been reserved or waived.20

What was the extent of Inovero’s civil liability?

The nature of the obligation of the co-conspirators in the commission of the crime
requires solidarity, and each debtor may be compelled to pay the entire obligation. 21 As
a co-conspirator, then, Inovero’s civil liability was similar to that of a joint tortfeasor
under the rules of the civil law. Joint tortfeasors are those who command, instigate,
promote, encourage, advise, countenance, cooperate in, aid or abet the commission of
a tort, or who approve of it after it is done, if done for their benefit.22 They are also
referred to as those who act together in committing wrong or whose acts, if independent
of each other, unite in causing a single injury.23 Under Article 2194 of the Civil Code,
joint tortfeasors are solidarily liable for the resulting damage. In other words, joint
tortfeasors are each liable as principals, to the same extent and in the same manner as
if they had performed the wrongful act themselves. As regards the extent of their
respective liabilities, the Court expressed in Far Eastern Shipping Company v. Court of
Appeals:24

x x x. Where several causes producing an injury are concurrent and each is an efficient
cause without which the injury would not have happened, the injury may be attributed to
all or any of the causes and recovery may be had against any or all of the responsible
persons although under the circumstances of the case, it may appear that one of them
was more culpable, and that the duty owed by them to the injured person was not same.
No actor’s negligence ceases to be a proximate cause merely because it does not
exceed the negligence of other acts. Each wrongdoer is responsible for the entire result
and is liable as though his acts were the sole cause of the injury.

There is no contribution between joint tort-feasors whose liability is solidary since both
of them are liable for the total damage. Where the concurrent or successive negligent
acts or omissions of two or more persons, although acting independently, are in
combination the direct and proximate cause of a single injury to a third person, it is
impossible to determine in what proportion each contributed to the injury and either of
them is responsible for the whole injury. x x x

It would not be an excuse for any of the joint tortfeasors to assert that her individual
participation in the wrong was insignificant as compared to those of the others. 25 Joint
tortfeasors are not liable pro rata. The damages cannot be apportioned among them,
except by themselves. They cannot insist upon an apportionment, for the purpose of
each paying an aliquot part. They are jointly and severally liable for the whole
amount.26 Hence, Inovero’s liability towards the victims of their illegal recruitment was
solidary, regardless of whether she actually received the amounts paid or not, and
notwithstanding that her co-accused, having escaped arrest until now, have remained
untried.

Under Article 2211 of the Civil Code, interest as part of the damages may be
adjudicated in criminal proceedings in the discretion of the court. The Court believes
and holds that such liability for interest attached to Inovero as a measure of fairness to
the complainants. Thus, Inovero should pay interest of 6% per annum on the sums paid
by the complainants to be reckoned from the finality of this judgment until full payment. 27

WHEREFORE, the Court AFFIRMS the decision promulgated on August 26, 2010,
subject to the MODIFICATION that appellant Maricar B. Inovero is ordered to pay by
way of actual damages to each of the complainants the amounts paid by them for
placement, training and processing fees, respectively as follows:

(a) Noveza Baful - P28,500.00;

(b) Danilo Brizuela - P38,600.00;

(c) Rosanna Aguirre - P38,600.00;

(d) Annaliza Amoyo - P39,000.00; and

(e) Teresa Marbella - P20,250.00.

plus interest on such amounts at the rate of six percent (6%) per annum from the finality
of this judgment until fully paid.

Inovero shall further pay the costs of suit.

SO ORDERED.
CASE#10

Republic of the Philippines

Supreme Court
Manila

THIRD DIVISION

PEOPLE OF THE PHILIPPINES, G.R. No. 178774

Appellee,
Present:

CARPIO MORALES, J., Chairperson,

BRION,
- versus - BERSAMIN,
VILLARAMA, JR., and
SERENO, JJ.

Promulgated:
MARLYN P. BACOS,
Appellant. December 8, 2010
x-----------------------------------------------------------------------------------------x

DECISION

BRION, J.:

For review is the decision,[1] dated April 18, 2007, of the Court of Appeals (CA) in CA-
G.R. CR-H.C. No. 01713 which affirmed the decision[2] of the Regional Trial Court (RTC),
Branch 79, Quezon City, in Criminal Case No. Q-96-65212 finding Marlyn P. Bacos
(appellant) guilty beyond reasonable doubt of illegal recruitment in large scale. The RTC
sentenced her to suffer life imprisonment and to pay a fine of P100,000.00.

This is not the first time we have passed upon this case as we previously disposed
of the appellants appeal in our Resolutions dated April 14, 2010 and August 23, 2010.
We are once more passing upon this case as we committed an oversight in our previous
Resolutions; one of the justices of the Court who then participated and voted for the denial
of the present appeal was also a member of the Division that handled the case at the
CA. Hence, the need to resubmit this case for another consideration and decision, with a
new Member replacing the Justice who should not have participated in resolving this case
before this Court.
The Facts

Together with her common law husband Efren Dimayuga, the appellant was charged of
illegal recruitment in large scale before the RTC, based on the complaints filed by ten (10)
individuals. The appellant and Dimayuga pleaded not guilty, and a joint trial
ensued. Dimayuga died during the pendency of the trial, leaving the appellant to face the
charges.

Of the ten (10) complainants, only three (3) testified, namely: Cynthia Deza, Elizabeth
Paculan and Ramelo Gualvez (complainants). The complainants claimed that within the
period of December 1993 to September 1994, they met Dimayuga and the appellant at
their house. Dimayuga represented that he was a recruiter who could send them to work
in Japan. The appellant likewise assured the complainants that they (she and Dimayuga)
could send them abroad. Believing that Dimayuga was a legitimate recruiter, the
complainants parted with their money to be used as placement and processing fees. The
money was given by the complainants either to Dimayuga while in the presence of the
appellant, or handed to the appellant who gave it to Dimayuga. Dimayuga issued receipts
for the money received.

The complainants were not deployed within the period promised by Dimayuga. The
complainants also discovered that Dimayuga and the appellant moved to another house.
Believing that they had been duped, the complainants and the other applicants filed
complaints for illegal recruitment against Dimayuga and the appellant before the
authorities.

The prosecution presented documentary evidence consisting of two (2) Certifications

(dated December 1, 1999 and January 19, 2000) from the Philippine Overseas
Employment Administration stating that Efren Dimayuga, Marlyn P. Bacos and Marlyn
Reyes y Bacos are not authorized to recruit workers for overseas employment.

In her defense, the appellant testified that she had no participation in the
transactions between her husband and the complainants. She denied having received
any money from the complainants, and likewise denied signing any receipt for payments
made. The appellant claimed that she only served the complainants snacks whenever
they came to where she and Dimayuga then resided.

The defense presented Pulina Luching who testified that Dimayuga and the appellant
were both known to her, having lived with them for a time. The witness denied having any
knowledge of the nature of Dimayugas business.

The RTC Ruling

The RTC gave credence to the testimonies of the complainants, which it found to be
straightforward and consistent. The RTC observed that the appellant did not refute the
allegation that Dimayuga was engaged in the recruitment and placement business. The
RTC ruled that sufficient evidence existed establishing that the two accused conspired in
engaging in illegal recruitment activities. The RTC found that the appellant gave
indispensable assistance to Dimayuga in perpetrating the fraud by receiving the amounts
of money for placement fees and assuring the complainants that Dimayuga can deploy
them for employment abroad. Under the circumstances, the RTC ruled that the appellants
denial deserved little credence in light of the positive testimony coming from credible
prosecution witnesses.

The CA Ruling

The CA upheld the factual findings of the RTC on appeal. The CA ruled that all the
elements of illegal recruitment, as defined under Article 13(b) of the Labor Code in relation
to Article 34 of the same Code, were sufficiently proven by the prosecution evidence. The
CA held that the appellant is liable as principal, considering that she actively participated
in the recruitment process by giving the victims the assurance that Dimayuga could
deploy them for employment abroad. The CA declared that the appellants acts fall within
the legal definition by enumeration of what constitutes recruitment.

The Issues

The appellant assigns the following errors for the Courts consideration:
 (1) In finding the appellant as principal in the crime charged absent any direct and
clear evidence of her active participation in the illegal recruitment; and

(2) In the alternative, the appellant is only liable as an accomplice under the
circumstances.

The Courts Ruling

We deny the appeal and affirm the appellants conviction, with modification on the
award of damages.

Together with Republic Act No. 8042 (Migrant Workers and Overseas Filipinos Act of
1995), the law governing illegal recruitment is the Labor Code which defines recruitment
and placement as any act of canvassing, enlisting, contracting, transporting, utilizing,
hiring or procuring workers, and includes referrals, contract services, promising or
advertising for employment, locally or abroad, whether for profit or not. [3] The same Code
also defines and punishes Illegal recruitment. Its Articles 38 and 39 state:
Art. 38. Illegal Recruitment.
(a) Any recruitment activities, including the prohibited practices
enumerated under Article 34 of this Code, to be undertaken by non-
licensees or non-holders of authority shall be deemed illegal and punishable
under Article 39 of this Code. x x x
(b) Illegal recruitment when committed by a syndicate or in large scale
shall be considered an offense involving economic sabotage and shall be
penalized in accordance with Article 39 hereof.
x x x Illegal recruitment is deemed committed in large scale if committed
against three (3) or more persons individually or as a group.
Art. 39. Penalties. -
(a) The penalty of life imprisonment and a fine of One Hundred
Thousand Pesos (P100,000.00) shall be imposed if illegal recruitment
constitutes economic sabotage as defined herein[.]

Applying these legal provisions to the facts, no doubt exists in our mind that the appellant
committed illegal recruitment activities together with Dimayuga. The prosecution
evidence clearly showed that despite the lack of license or authority to engage in
recruitment, the appellant admitted that she gave the complainants assurances that she
and Dimayuga could deploy them for employment in Japan. The complainants, in this
regard, were categorical in saying that they relied not only on the representations of
Dimayuga but also on the assurances of the appellant that they would be deployed for
work in Japan.
 We arrive at this conclusion after additionally considering the following established
acts of the appellant: (a) her acceptance of the placement fee given by the complainants;
(b) the fact that she communicated to the complainants the date of their departure; and
(c) her information on how the balance of the placement fee should be paid.These acts
indubitably show that she was engaged in illegal recruitment activities together with
Dimayuga. Thus, the appellants liability under the circumstances cannot be considered
as that of a mere accomplice, but rather as a principal directly and actively engaged in
illegal recruitment activities.

Lastly, the appellants argument that she did not derive any consideration from the
transactions or that she made the assurances after Dimayugas representations were
made to the complainants cannot serve to exonerate her from the crime. We emphasize
that the absence of a consideration or misrepresentations employed by the appellant is
not material in the prosecution for illegal recruitment. By its very definition, illegal
recruitment is deemed committed by the mere act of promising employment without a
license or authority and whether for profit or not. Moreover, we previously held that the
time when the misrepresentation was made, whether prior or simultaneous to the delivery
of the money of the complainants, is only material in the crime of estafa under Article
315(2)(a) of the Revised Penal Code, as amended, and not in the crime of illegal
recruitment.[4]

For all these reasons, we affirm the CAs finding that the appellant committed illegal
recruitment in large scale.

The Penalty

The illegal recruitment having been committed against three victims is illegal recruitment
in large scale, as provided under the aforequoted Articles 38 and 39 of the Labor
Code. We, thus, likewise affirm the CAs ruling imposing the penalty of life imprisonment
and a fine of P100,000.00, pursuant to the first paragraph of Article 39 of the Labor Code,
as amended. Committed in large scale, the illegal recruitment is deemed to constitute
economic sabotage.

We find as well that the CA decision should be modified by adding an award of

legal interest with respect to the complainants civil indemnity. The amounts of civil
indemnity represent the amount of placement fees that the complainants paid to
Dimayuga and the appellant. The legal interest of twelve percent (12%) per annum shall
be imposed, reckoned from the filing of the information until the finality of the judgment,
consistent with prevailing jurisprudence.[5]
WHEREFORE, premises considered, the Court resolves to:

(1) RECALL the Resolutions dated April 14, 2010 and August 23, 2010.

(2) DENY the appeal for failure to sufficiently show that a reversible error was
committed by the Court of Appeals in the assailed decision; and

(3) AFFIRM with MODIFICATION the Decision of the Court of Appeals in CA-G.R.
CR-H.C. No. 01713 which affirmed the decision of the Regional Trial Court,
Branch 79, Quezon City, in Criminal Case No. Q-96-65212, finding Marlyn P.
Bacos guilty beyond reasonable doubt of illegal recruitment in large scale.
Appellant is ordered to indemnify the complainants the following amounts:

(a) Cynthia Deza - P20,000;

(b) Elizabeth Paculan - P10,000; and

(c) Ramelo Gualvez - P5,000

representing the amounts paid by the complainants as placement

fees, plus 12% legal interest per annum that shall be reckoned from the filing
of the information until the finality of the judgment.

SO ORDERED.
CASE#11

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 119160 January 30, 1997

PEOPLE OF THE PHILIPPINES, plaintiff-appelle,

vs.
EDITHA SEÑORON Y LIMORA, accused-appellant.

FRANCISCO, J.:

Appellant Editha L. Señoron and her co-accused Aquilino Ilano and one John Doe, both
at large, were charged in four separate informations with one count of illegal recruitment
in large scale 1 and three counts of estafa 2 before the Regional Trial Court of Pasay
City. 3 When arraigned, appellant pleaded not guilty. Trial thereafter ensued. On
October 25, 1994, the trial court rendered a decision convicting appellant as charged
and sentencing her "to suffer a penalty of life imprisonment and to pay a fine of one
hundred thousand pesos (P100,000.00)" 4 for illegal recruitment, and "to suffer a penalty
of three (3) times of arresto mayor in its maximum period as minimum (or two (2) years
ten (10) months and twenty one (21) days) to prision mayor in its minimum period as
maximum (or to eight (8) years) and to compensate the private complainants the sum of
fifty nine thousand pesos (P59,000.00)" 5 for the three counts of estafa. Dissatisfied,
appellant interposed the instant appeal with the following assignment of errors, thus:

THE LOWER COURT ERRED IN NOT FINDING THAT THE

PROSECUTION FAILED TO PROVE THE GUILT OF THE ACCUSED-
APPELLANT EDITHA SEÑORON BEYOND REASONABLE DOUBT IN
THE ILLEGAL RECRUITMENT, (LARGE SCALE) CASE.

II

THE LOWER COURT ERRED IN CONVICTING ACCUSED-APPELLANT

EDITHA SEÑORON OF THE CRIME OF ILLEGAL RECRUITMENT,
(LARGE SCALE) AND SENTENCING HER TO SUFFER A PENALTY OF
LIFE IMPRISONMENT AND TO PAY A FINE OF ONE HUNDRED
THOUSAND PESOS (P100,000.00). 6

Aptly narrated in the People's brief and supported by the evidence on record are the
following facts:

At the consolidated hearing of the cases filed against appellant,

complainants Cesar Virtucio, Ronilo Bueno and Greg Corsega testified for
the prosecution.

Cesar Virtucio testified that sometime in October 1991, he met appellant

at accused Aquilino Ilano's house in Malibay, Pasay City, when he
(Virtucio) and other applicants applied for jobs abroad (tsn, May 27, 1993,
p. 6). During the meeting at Ilano's residence, Virtucio and his companions
were given job application forms which they filled up as told (ibid, p. 9).
Thereafter, Virtucio paid Ilano, in the presence of appellant, the amount of
P20,000.00 as placement fee (Exhibit "B"). After paying the placement
fee, Virtucio and his companions were told by appellant to follow-up their
applications at her office or at Padre Faura, Manila (ibid, p. 14). Appellant
failed to send Virtucio and his companions abroad, hence, he (Virtucio),
together with applicants Ronilo Bueno and Greg Corsega, filed a
complaint for illegal Recruitment and Estafa against appellant, a certain
John Doe and Aquilino Ilano before the National Bureau of Investigation
(ibid, p. 18).

"Greg Corsega, one of the three (3) complainants, testified that accused
Aquilino Ilano introduced him to appellant as the person who will process
his papers for employment abroad (tsn, June 30, 1993, pp. 8 to 9).
Thereafter, Ilano demanded from Corsega the amount of Twenty
Thousand Pesos (P20,000.00) as placement fee (ibid). The amount of
Twenty Thousand Pesos (P20,000.00) was given to Ilano in the presence
of appellant and it was at this juncture that appellant promised Corsega
and his companions (Virtucio and Bueno) that they will be called as a
group to sign a contract. However, appellant's promise to deploy Corsega,
Virtucio and Bueno for employment abroad never materialized, prompting
him (Corsega), Virtucio and Bueno to file a complaint for Illegal
Recruitment and Estafa against appellant, John Doe and Aquilino Ilano
before the National Bureau of Investigation.

Ronilo Bueno testified that he was initially referred by Aquilino Ilano to his
(Ilano's) secretary in order to sign papers for employment abroad (August
31, 1993, p. 4). After signing some papers, Bueno was required by Ilano to
pay the amount of P19,000.00 for the processing of his passport and visa
(ibid, p. 5).

The amount of P19,000.00 was immediately paid to Ilano in the presence

of appellant (ibid, p. 7). Whereupon, Ilano told Bueno that the money will
be given to appellant who will be responsible in the processing of their
papers for employment abroad (ibid, p. 9). The promise to deploy Bueno,
Virtucio and Corsega abroad did not materialize, hence, the three (Bueno,
Virtucio and Corcega) went to appellant, who showed them the list of the
money paid by them. At the same time, appellant advised the three to wait
for notice of their employment abroad (ibid., pp. 9 to 10). Again, nothing
happened to their applications and this prompted Bueno and his
companions (Virtucio and Corcega) to file charges of Illegal Recruitment
and Estafa against Aquilino Ilano, John Doe and appellant before the
National Bureau of Investigation.

Bueno, Virtucio and Corcega uniformly testified that before the filing of
Illegal Recruitment and Estafa cases against Aquilino Ilano, John Doe and
appellant before the National Bureau of Investigation, they (Bueno,
Virtucio and Corcega) asked for the return of their money. Consequently,
appellant issued Interbank Check No. 05263108 in the amount of
P135,000.00 in words but P130,000.00 in figures. They also testified that
the amount covers the payment given by nine (9) applicants including
complainants (tsn, May 27, 1993, p. 16 and tsn, June 30, 1993, pp. 33 to
34). However, Interbank Check No. 05263108 was never encashed as an
inquiry from the bank revealed that the check was not sufficiently funded
(ibid., p. 38).

The prosecution presented as its last witness Socorro Landas, an

employee of the Philippine Overseas Employment Administration (POEA),
who testified that appellant is not licensed by the Philippine Overseas
Employment Administration to be a recruiter (tsn, February 11, 1993, pp. 2
to 5).7
 On the other hand, as lone witness for her defense, accused EDITHA
SEÑORON, testified that she only met the private complainants at the
National Bureau of Investigation on September 1993, that she has nothing
to do with the receipts of payment to Greg Corsega; and Cesar Virtucio
which receipts were signed by Aquilino Ilano. She admitted having issued
check No. 05263108 (Exh. C) just to accommodate co-accused Aquilino
Ilano who promised that he will be the one to put funds on said check. 8

At the outset, the Court observes that appellant confines her appeal to her conviction for
illegal recruitment as she neither questioned nor assailed her convictions for the three
(3) counts of estafa. The failure to appeal therefrom rendered the estafa convictions
final and executory; hence, this review shall be limited to the illegal recruitment case.

In essence, the centerpiece of appellant's defense dwells on the alleged insufficiency of

the prosecution's evidence to prove her guilt as "[t]here is nothing on record . . . which
says that placement fees received by Aquilino Ilano from the three (3) private
complainants was turned over to [her]". 9 Appellant asserts that she never issued or
signed any receipts and that as a matter of fact "[t]he receipts of payment of alleged
placement fees were received and receipted by accused Aquilino Ilano." 10 Appellant
also harps on her being a mere accommodation party in the issuance of the Interbank
Check in the amount of P135,000.00 and "that after the check bounced", she contends
that "no notice whatsoever was given to [her]". 11 Thus, appellant concludes that the
prosecution failed to discharge its burden of proof thereby necessitating her acquittal.

We are not persuaded.

Illegal recruitment is defined under Article 38 (a) of the Labor Code, as amended, as
"(a)ny recruitment activities, including the prohibited practices enumerated under Article
34 of this Code, to be undertaken by non-licensees or non-holders of authority." Article
13 (b) of the Code defines "recruitment and placement" as

[A]ny act of canvassing, enlisting, contracting, transporting, utilizing, hiring

or procuring workers, and includes referrals, contract services, promising
or advertising for employment, locally or abroad, whether for profit or
not: Provided, that any person or entity which in any manner, offers or
promises for a fee employment to two or more persons shall be deemed
engaged in recruitment and placement.

To prove illegal recruitment, two elements must be shown namely: (1) the person
charged with the crime must have undertaken recruitment activities, or any of the
activities enumerated in Article 34 of the Labor Code, as amended; and (2) said person
does not have a license 12 or authority 13 to do so. 14 Contrary to appellant's mistaken
notion, therefore, it is not the issuance or signing of receipts for the placement fees that
makes a case for illegal recruitment, but rather the undertaking of recruitment activities
without the necessary license or authority. And in this case, evidence on record belie
appellant's assertion that she did not engage in any recruitment activity and that the
fees paid by the applicants were not turned over to her possession as shown by the
following testimony of private complainant Virtucio, thus:

Fiscal Untalan:

Q: Now, you said that you together with your co-complainant

were recruited by the accused at Malibay, Pasay City, now,
in connection with that recruitment of applicant, do you
remember when was your transaction if there was any?

A: Before we were recruited she gave us an application

paper which we filled up and she told us to file (sic) it up.

Q: And did you comply?

A: Yes, sir."
 xxx xxx xxx

Q: Now, after having paid that placement fee of P20,000.00

to the accused, what happened next?

A: She told us to follow it up at her residence and also at her

office in Padre Faura.

Q: And what happened to your follow up?

A: Nothing, sir." (tsn, May 27, 1993, pp. 9-10, 13-14.) 15

which testimony was corroborated by prosecution witness Ronilo Bueno. Thus:

Fiscal Untalan:

Q: Is this promised of Ilano materialized? (sic)

A: No, sir.

Q: Do you know the reason why?

A: Ilano told us that our money will be paid to Edith and that
Edith would be the one to attend to our papers.

Q: After knowing that information what did you do?

A: We went to Edith.

Q: You said, we, who are your companions?

A: Corsega and Virtucio.

Q: What happened when you together with Corsega and

Virtucio went to Editha Señoron?

A: She showed to us the list of the money that we paid and

told us to wait.

Q: And then what did you do, did you wait?

A: Yes, sir.

Q: What happened?

A: Nothing happened and "tumagal"

Q: You said nothing happened and "tumagal" for how long?

A: Almost a year.

Q: After that period of time what did you do together with the
others?

A: We filed a complaint before the NBI.

Q: Before you filed this complaint did you ask the return of
your money before the accused?

A: Yes, sir.

Q: What was the answer?

 A: Edith issued a check.

Q: What check?

A: Interbank check.

xxx xxx xxx

Fiscal Untalan:

Q: Now, when you filed your application to the accused for a

job abroad particularly in Taiwan and you were failed to be
deployed together with your companions, what did you do?
(sic)

A: We asked for the refund of the money we have paid.

Q: Now, what else aside from that?

A: When the check she issued to us bounced we filed the

complaint before the NBI.

Q: Before filing any case with the NBI did you make any
investigation as to the capacity of the agency whether they
are authorized?

A: Yes, sir.

Q: Where did you verify its authority?

A: POEA.

Q: What happened there?

A: That they were not legitimate to recruit (sic)." (tsn, August

31, 1993, pp 9-12) 16

Appellant made a distinct impression that she had the ability to send applicants for work
abroad. She, however, does not possess any license or authority to recruit which fact
was confirmed by the duly authenticated certification 17 issued by the Manager of the
Licensing Branch of the POEA, and by the testimony of Ms. Socorro Landas
representing the Licensing Division of the Philippine Overseas Employment
Administration (POEA). It is the lack of necessary license or authority that renders the
recruitment activity, as in this case, unlawful or criminal. 18

Appellant's residual arguments that she was just an accommodation maker in the
issuance of the check and that private complainants failed to notify her after the check
bounced do not merit serious consideration. It has to be emphasized that appellant is
not being prosecuted for violation of the anti-bouncing check law 19 where the foregoing
contentions may have an impact, but for illegal recruitment which the prosecution was
able to establish beyond reasonable doubt.

WHEREFORE, the trial court's decision is hereby AFFIRMED.

SO ORDERED.

Narvasa, C.J, Davide, Melo and Panganiban, JJ., concur.

CASE#12

FIRST DIVISION

[G.R. No. 121179. July 2, 1998]

PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ANTONINE B. SALEY a.k.a.

ANNIE B. SALEY, accused-appellant.

DECISION
VITUG, J.:

The case before the Court focuses on the practice of some "illegal recruiters" who
would even go to the extent of issuing forged tourist visas to aspiring overseas contract
workers.These unsuspecting job applicants are made to pay exorbitant "placement" fees
for nothing really since, almost invariably, they find themselves unable to leave for their
purported country of employment or, if they are able to, soon find themselves
unceremoniously repatriated. This Court once described their plight in a local proverb as
being naghangad ng kagitna, isang salop ang nawala.[1]
In this appeal from the 3rd March 1995 decision of the Regional Trial Court of La
Trinidad, Benguet, Branch 10,[2] appellant Antonine B. Saley, a.k.a. Annie B. Saley, seeks
a reversal of the verdict finding her guilty beyond reasonable doubt of eleven counts
of estafa punishable under the Revised Penal Code and six counts of illegal recruitment,
one committed in large scale, proscribed by the Labor Code.
Appellant was indicted in eleven separate informations for estafa under Article 315,
paragraph 2(1), of the Revised Penal Code. The cases (naming the complainants and
stating the amounts therein involved) include: (1) Criminal Case No. 92-CR-
1397[3] (Francisco T. Labadchan P45,000.00); (2) Criminal Case No. 92-CR-1414
(Victoria Asil P33,000.00); (3) Criminal Case No. 92-CR-1415 (Cherry Pi-ay P18,000.00);
(4) Criminal Case No. 92-CR-1426 (Corazon del Rosario P40,000.00); (5) Criminal Case
No. 92-CR-1428 (Arthur Juan P24,200.00); (6) Criminal Case No. 93-CR-1644 (Alfredo
C. Arcega P25,000.00); (7) Criminal Case No. 93-CR-1646 (Brando B.
Salbino P25,000.00); (8) Criminal Case No. 93-CR-1647 (Mariano DamologP25,000.00);
(9) Criminal Case No. 93-CR-1649 (Lorenzo Belino P25,000.00); (10) Criminal Case No.
93-CR-1651 (Peter Arcega P25,000.00) and (11) Criminal Case No. 93-CR-1652
(Adeline Tiangge P18,500.00).
Except for the name of the offended party, the amount involved and the date of the
commission of the crime, the following information in Criminal Case No. 93-CR-1652
typified the other informations for the crime of estafa:
That in or about the month of December, 1991, and sometime prior to or subsequent
thereto, at Buyagan, Municipality of La Trinidad, Province of Benguet, Philippines, and
within the jurisdiction of this Honorable Court, the above-named accused, with intent to
defraud ADELINE TIANGGE y MARCOS and by means of deceit through false
representations and pretenses made by her prior to or simultaneous with the commission
of the fraud, did then and there willfully, unlawfully and feloniously defraud said
ADELINE TIANGGE y MARCOS, by then and there representing herself as a duly
authorized or licensed recruiter for overseas employment, when in truth and in fact she
was not, thereby inducing the said ADELINE TIANGGE y MARCOS to give and
deliver to her the total amount of EIGHTEEN THOUSAND FIVE HUNDRED PESOS
(P18,500.00), Philippine Currency, for placement abroad and after having received it,
she appropriated and misappropriated the same for her own use and benefit and despite
repeated demands made upon (her) to return the same, she refused, failed, neglected,
and still refuses, fails and neglects to comply therewith, all to the damage and prejudice
of ADELINE TIANGGE y MARCOS in the total sum aforesaid.
 "Contrary to law.[4]
For the violation of Article 38, in relation to Article 39, of the Labor Code, five separate
informations were also instituted against appellant on various dates. These cases (with
the names of the complainants) include: (1) Criminal Case No. 92-CR-1396 (Francisco T.
Labadchan); (2) Criminal Case No. 92-CR-1413 (Cherry Pi-ay); (3) Criminal Case No. 92-
CR-1416 (Victoria Asil); (4) Criminal Case No. 92-CR-1425 (Corazon del Rosario) and
(5) Criminal Case No. 92-CR-1427 (Arthur Juan). The typical information in these
indictments read:
That sometime in the month of April, 1991 and subsequent thereto at Buyagan,
Municipality of La Trinidad, Province of Benguet, Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused, did then and there
willfully, unlawfully and knowingly recruit one ARTHUR JUAN for overseas
employment, by then and there ably misrepresenting herself as a duly authorized or
licensed recruiter when in truth and in fact she fully knew it to be false but by reason of
her said misrepresentations which were completely relied upon by Arthur Juan, she was
able to obtain from the latter the total amount of TWENTY FOUR THOUSAND TWO
HUNDRED PESOS (P24,200.00), Philippine Currency, all to the damage and prejudice
of Arthur Juan in the total sum aforesaid.
"Contrary to Law.[5]
The information in Criminal Case No. 93-CR-1645 for illegal recruitment in large scale
under Article 38, paragraph 1, of Presidential Decree No. 442 (Labor Code), as amended,
filed on 16 April 1993, read:
That in or about the months of August and September, 1992, in the Municipality of La
Trinidad, Province of Benguet, Philippines, and within the jurisdiction of this Honorable
Court, the above-named accused, did then and there willfully, unlawfully and knowingly
recruit the following: PETER ARCEGA, LORENZO BELINO, MARIANO
DAMOLOG, FIDEL OPDAS, BRANDO B. SALBINO, DEMBER LEON and
ALFREDO C. ARCEGA for overseas employment, by then and there misrepresenting
herself as a duly authorized or licensed recruiter when in truth and in fact she was not
and by reason of her said misrepresentation which was completely relied upon by the
said complainants whom she recruited, either individually or as a group amounting to
illegal recruitment in large scale causing economic sabotage, she was able to obtain and
received from them the aggregate total amount of ONE HUNDRED SEVENTY FIVE
THOUSAND PESOS (P175,000.00), Philippine Currency, all to the damage and
prejudice of the foregoing complainants in the total sum aforesaid.
"Contrary to law.[6]
Appellant pleaded not guilty to all the charges of illegal recruitment and estafa. The
criminal cases filed were raffled off to two (2) branches of the Regional Trial Court of
Benguet; later, however, the cases were consolidated at the instance of the prosecution.
Parenthetically, appellant jumped bail pending trial but she was soon arrested by
agents of the Criminal Investigation Service ("CIS").

The Evidence for the Prosecution. -

In Criminal Case No. 92-CR-1397 and Criminal Case No. 92-CR-1396

Francisco Labadchan, a 25-year-old employee in the Navy Base in Pacdal, Baguio

City, was introduced to appellant by Crispin Perez. In September 1991, the two went to
the house of Conchita Tagle at Kilometer 3, La Trinidad, Benguet, who was known to be
recruiting workers for abroad. After Labadchan had expressed interest in applying for a
job in Korea, Tagle told Labadchan to prepare P45,000.00, P30,000.00 of which was to
be paid that month and the balance of P15,000.00 before his departure for
abroad. Labadchan paid Tagle the amount of P30,000.00 on 23 September
1991. Appellant, in turn, received that amount when she went to La Trinidad to "brief"
him. She told Labadchan that his flight would be on the 9th of October 1991 and that he
should have paid by then the balance of P15,000.00 of the fees. He paid Tagle
the P15,000.00 balance on 05 October 1991. When he requested her to make a receipt,
Tagle included the amount in the old receipt for the P30,000.00 previously
given. Appellant handed over to Labadchan some papers to fill up and gave last-minute
instructions before she boarded a green-colored aircraft.
On 08 October 1991, Labadchan and his wife went to Manila and stayed, as so
instructed by Tagle, at the Prince Hotel near the terminal of the Dangwa bus company in
Dimasalang, Manila. There, he met other people, among them, his co-complainant Arthur
Juan. In the morning of 09 October 1991, Labadchan and the others were told to go to
the airport with Tagle, where appellant was supposed to give the travel papers including
passports and plane tickets for Korea. At the airport, however, appellant told the group
that their flight had been re-scheduled for 11 October 1991. Labadchan returned to
Baguio City.
On 11 October 1991, Labadchan returned to the airport only to be told this time,
however, that his passport was still with the Department of Foreign Affairs. Appellant told
her husband to accompany Labadchan to the Foreign Affairs office. When Labadchan
received the passport, he saw that while his picture appeared on it, the passport was
made out in the name of a person from Negros Occidental. Labadchan had to imitate the
signature on the passport just so he could get it. Back at the airport, he was allowed inside
the terminal but only to be later sent out because the ticket he had was one intended for
passage from Korea and not to Korea. Asserting that he and company were mere
"chance passengers," appellant sent them all home with a promise that another departure
date would be set. She also took back the show money of US$1,000.00.
Appellant would repeatedly schedule a departure date but nothing tangible came out
of her assurances. Finally, Labadchan was able to get appellant to promise that the
money he had given her would be refunded. When this promise neither materialized,
Labadchan finally reported the matter to the National Bureau of Investigation ("NBI"). In
that office, appellant executed a promissory note stating that she would return the amount
of P46,500.00, which included the amount of P1,500.00 allegedly used for getting a
passport, to Labadchan.[7]

In Criminal Case No. 92-CR-1414 and Criminal Case No. 92-CR-1416

Victoria Asil, a 40-year-old housewife from Imelda Village, Roxas Street, Baguio City,
heard from her elder sister, Feling Derecto, that appellant was recruiting workers for
abroad.During the second week of January 1992, she, along with her husband Gabriel,
went to appellants house in Buyagan, La Trinidad. Appellant assured her that she could
have a job in a factory in Korea. Appellant asked for an advance fee of P25,000.00 of
the P40,000.00 agreed fee. Victoria gave appellant the "advance fee" on 13 January 1992
at her (Victorias) shop in Shoppers Lane, Baguio City which appellant acknowledged by
issuing a receipt for the amount. She told Victoria to be at appellant's house in Buyagan
after three weeks.
When Victoria went to appellants house as so directed, appellant told her that her
flight had been postponed supposedly because prior applicants had to be accommodated
first. Victoria met appellant seven more times only to be ultimately told that the latter had
been allegedly fooled by the main office in Manila. Appellant, nevertheless, demanded an
additional P5,000.00 from Victoria so that she could leave on 18 April 1992. Victoria gave
appellant the amount of P5,000.00 at her shop on 31 March 1992 for which appellant
gave a corresponding receipt.
When on 18 April 1992 still nothing happened, Victoria demanded from appellant a
refund. Appellant gave her an advance of P15,000.00. An acknowledgment receipt with
appellants signature affixed thereon would evidence that payment. Appellant, however,
failed to return the rest of the promised refund.[8]

In Criminal Case No. 92-CR-1413 and Criminal Case No. 92-CR-1415

Cherry Pi-ay, a 26-year-old nursing student from Acop, Tublay, Benguet, was visited
once in March 1991 by appellant who encouraged Cherry to apply for work in a textile or
a plastic factory in Korea with a monthly salary of US$800.00. Appellant told Cherry that
the moment she would pay the amount of P45,000.00, she could be deployed in
Korea. Cherry prepared her bio-data and gave it to appellant at the latter's residence
during the first week of April 1991.
Cherry was able to leave the country on 04 July 1991 after having paid the total
amount of P45,000.00. Appellant told her that a certain Ramil would meet her at the
airport in Korea. When she arrived, a Filipina, named Marlyn, instead met her. Marlyn
introduced herself as appellants friend and accompanied Cherry to a certain house owned
by a Korean. There, Cherry met, among other compatriots, Corazon del Rosario and Jane
Kipas. Cherry soon realized that she was not going to have a job in the factory promised
by appellant. Instead, she was made to work for the Korean applying rugby on and folding
leather jackets. About a month later, men from the Korean Immigration accosted her and
the others. Brought in for questioning by Immigration officials, Cherry and her companions
were informed that they were illegal workers. After the investigation, Cherry and her group
were allowed to go but on 08 August 1991, all were deported.
Back to the Philippines, the deportees were assured by appellant that they would get
a refund of their money. Cherry executed a sworn statement narrating her experience in
Korea.[9]
Ayson Acbaya-an, Cherrys "boyfriend" who later was to become her husband,
corroborated Cherrys testimony that appellant first received P18,000.00 from
Cherry. Thereafter, appellant also received P27,000.00 from Cherry, fifteen thousand
pesos (P15,000.00) of which amount came from him. In both instances, appellant signed
receipts for the payments. The receipts were among Cherry's papers confiscated in
Korea.[10]

In Criminal Case No. 92-CR-1425 and Criminal Case No. 92-CR-1426

Corazon del Rosario, a 34-year-old housemaid from 48 Happy Homes, Baguio City,
had known appellant, an acquaintance, since 1980. One day in December 1990, she
happened to chance upon appellant at a PLDT telephone booth in Kilometer 4, La
Trinidad, Baguio City. Appellant, representing herself to be an authorized recruiter, tried
to persuade Corazon to work abroad. Corazon showed interest. From then on, appellant
would visit Corazon in her brothers house in Kilometer 4. Ultimately, appellant was able
to convince Corazon that, for a fee of P40,000.00, she could be sent to Korea. Corazon
gave appellant the amount of P15,000.00. She paid the balance of P25,000.00 in May
1991. The payments were both made in the presence of Cherry Pi-ay and Jane Kipas.
Appellant issued the corresponding receipts for these amounts.
Corazon took the flight for Korea on 28 June 1991. Appellant had instructed Corazon,
upon landing in Korea, to call up a certain Ramil. At the airport, Corazon, including her
companions among them Jane Kipas, kept on dialing the number but each time only a
Korean woman would answer the call. Later, that evening, a certain Marlyn, who
introduced herself as appellants friend, took them to a hotel. There, Marlyn took their
show money of US$1,000.00. The group stayed overnight in the hotel and the following
morning, a Korean took them to a house proximately two hours away by car from the
airport. For about a month, they did nothing but apply rugby on leather jackets, for which
they were not paid, until a policeman arrived and took all ten of them to the airport. All
that the immigration and airport personnel would tell them was that they should be
thankful they were only being repatriated home. Immigration and airport authorities
confiscated everything that they had.
At home, appellant promised to return Corazons money. Not having received the
promised refund, Corazon went to the CIS stationed at Camp Dangwa where, on 28 July
1992, she executed her sworn statement.[11]
Avelina Velasco Samidan, a friend of Corazon and in whose house the latter would
stay whenever she was in Baguio, corroborated the testimony of Corazon that she gave
to appellant the amount of P15,000.00, ten thousand pesos of which amount Corazon
borrowed from Avelina, and that some time in April 1991, Corazon withdrew P25,000.00
from the bank which she likewise paid to appellant.[12]
 In Criminal Case No. 92-CR-1427 and Criminal Case No. 92-CR-1428

Arthur Juan, a 30-year-old farmer from Dumulpot, Tublay, Benguet, first met appellant
in her house at Buyagan, La Trinidad, Benguet, when he, together with Maxima Gomez,
Tirso Gomez and Francisco Labadchan, went to see appellant who was said to be
recruiting workers for Korea. Juan promptly submitted his bio-data form after being told
that he could work in a factory in Korea at US$400.00 a month. Appellant quoted a
processing fee of P40,000.00. Juan initially paid the amount of P6,500.00 in April
1991. On 09 October 1991, the scheduled date of the flight, Juan went to the airport and
gave appellant another P15,000.00; the final balance of the fees were, by their
agreement, to be remitted to appellant on a salary deduction basis. Appellant then told
Juan that he could not leave on that day (09 October 1991) because the airplane was
already full. Appellant took back Juans passport, telling Juan that he should be able to
depart in a few days. Appellant, however, kept on rescheduling the flight for about five
more times until it became clear to Juan that he had been deceived. Juan paid out a total
amount of P24,200.00, including the US$100.00 that would have been his pocket money,
to appellant. The latter executed receipts for the amounts.
Juan executed a sworn statement narrating the unfortunate incident. [13]

In Criminal Case No. 93-CR-1652

Adeline Tiangge, a 43-year-old housekeeper from Bangao, Buguias, Benguet,

learned that appellant was recruiting workers for abroad. Adeline, accompanied by her
sister, went to see appellant at her house in Buyagan some time in December
1991. There were others, like her, who also went to see appellant. When she produced
the required identification pictures and P1,500.00 for passport processing, appellant told
Adeline that she could be a factory worker in Korea with a monthly salary of
US$350.00. Appellant agreed to be paid by Adeline the additional P35,000.00 balance by
installment. The first installment of P17,000.00 was paid on 15 February 1992, evidenced
by a receipt signed by Antonine Saley, with the remaining P18,000.00 being payable
before getting on her flight for abroad.
Adeline waited in Baguio City for word on her departure. Adeline, together with some
other applicants, thrice went to appellants office at the Shoppers Lane to check. She also
went to Dimasalang, Manila, in front of the Dangwa terminal, for a like purpose. Appellant
informed her that she just had to wait for her flight. Adeline, exasperated, finally
demanded a refund of the amount she had paid but appellant merely gave her P100.00
for her fare back to Benguet.[14]
-0-
The sum of the evidence, infra., in Criminal Case No. 93-CR-1645 for illegal
recruitment in large scale had been submitted to likewise constitute the evidence to
establish the People's case, respectively, in -

Criminal Case No. 93-CR-1644

Alfredo Arcega, a 42-year-old hotel employee from 16 Q.M. Subdivision, Baguio City,
heard from a former co-worker, Fidel Opdas, that appellant was recruiting workers for
overseas employment. Interested, he, in the company of his nephew, Peter Arcega, went
to appellants house in Buyagan, La Trinidad. There, he met job applicants Dembert Leon,
Mariano Damolog and Brando Salbino. Appellant assured the group that they could get
employed in Taiwan for a monthly salary of P12,000.00 to P15,000.00. She told them that
the processing and placement fees would amount to P40,000.00 each. Arcega and his
companions agreed.
On 17 August 1992, Arcega paid appellant P10,000.00 in Dimasalang,
Manila. Appellant issued a cash voucher for the amount. She told Arcega to just wait for
the results. On 30 September 1992, appellant asked Arcega for another P15,000.00
which amount he paid. With him at the time were his nephew Peter Arcega, as well as
Dembert Leon, Mariano Damolog, Lorenzo Belino and Brando Salbino. Appellant issued
a receipt and affixed thereon her signature. Appellant told Arcega that with the payment,
his employment abroad was assured. She stressed, however, that the balance
of P15,000.00 should be paid before his departure for Taiwan. After following up the
matter with appellant in October 1992 and then in December 1992, he finally gave
up. Arcega went to the POEA office in Magsaysay Avenue, Baguio City, and when he
learned that appellant had pending cases for illegal recruitment, he also filed his own
complaint and executed an affidavit before Atty. Justinian Licnachan. [15]

Criminal Case No. 93-CR-1646

Brando Salbino, a 36-year-old resident of East Quirino Hill, Baguio City, used to be a
"forester" of the DENR. In July 1992, he met appellant at her Buyagan residence after his
brother-in-law, Fidel Opdas, had said that she was recruiting workers for
abroad. Appellant told him that she could help him get employed in Taiwan with
a P12,000.00 monthly salary. Salbino submitted various documents required by
appellant. On 11 August 1992, Salbino paid appellant the amount of P10,000.00 at her
Dimasalang "temporary office" so that, according to her, his travel papers could be
processed. The payment was receipted. On 30 September 1992, he paid her
another P15,000.00, for which appellant again issued an acknowledgment receipt.
Appellant told Salbino to merely wait in Baguio City. When she failed to show up, he
went to appellants house in Buyagan to verify. She was not there. The following week, he
went to Manila with Fidel Opdas hoping to see her. Appellant's whereabouts could not be
determined. Having failed to locate her, Salbino and his companions went to the POEA
office in Magsaysay, Baguio City. It was at the POEA office that they were to learn that
appellant was not in the list of licensed recruiters. He, along with the others, then executed
an affidavit-complaint before Atty. Licnachan.[16]

Criminal Case No. 93-CR-1647

Mariano Damolog, a 33 year-old farmer from 26 P. Burgos Street, Baguio City, went
to appellants residence in Buyagan in July 1992 when informed by Fidel Opdas, his co-
worker at the MIDO Restaurant, that appellant was recruiting workers for Taiwan.
Appellant herself later told Damolog that she was licensed to recruit workers. He forthwith
applied for a position at a factory in Taiwan with a salary of between US$400.00 and
US$500.00 a month. He, after being required to pay a processing fee, paid the amount
of P10,000.00 to appellant at her Manila office. Appellant gave him a cash
voucher. Damolog was then supposed to just wait in Baguio City for a telegram.
When he did not receive word from appellant, Damolog went to Manila to see what
had happened to his application. Appellant was again told to simply stand by in Baguio
City. After several days, Opdas, who had meanwhile gone to Manila, told Damolog to see
appellant in Manila. In Manila, appellant told Damolog to sign a bio-data form for
screening purposes. Like Peter Arcega, Fred Arcega, Brando Salbino and Lorenzo
Belino, he was also asked to pay another P15,000.00. The group went back to Baguio
City to raise the amount of P15,000.00 each. On 30 September 1992, he, together with
Fred and Peter Arcega, Brando Salbino and Lorenzo Belino, returned to Manila. Damolog
handed over his P15,000.00 to appellant who issued an acknowledgment receipt, signed
by Annie Saley which, according to appellant, was her name. Appellant assured him that
he would be among the first to go to Taiwan by December 1992.
December 1992 came but no word was received prompting Damolog and his
companions to repair to appellants house in Buyagan. She was not home. Damolog
proceeded to Manila where appellant told him to wait a few more days. When still nothing
happened, Damolog and his companions went to the POEA office where Atty. Licnachan
issued a certification stating that appellant was not authorized to recruit workers. Damolog
and his companions filed a joint affidavit-complaint executed before Atty.
Licnachan[17] against appellant.
 Criminal Case No. 93-CR-1649

Lorenzo Belino, a 37-year-old farmer from Tawang, La Trinidad, Benguet, was in

Manila in August 1992 looking for employment. Fidel Opdas, a companion in his trip to
Manila, mentioned that perhaps appellant could help. Belino saw appellant who then told
him about the prospect of getting employed in Taiwan. Appellant invited him to see her
on 20 September 1992 in Buyagan.
On the appointed date, Belino found Mariano Damolog, Fidel Opdas, Brando Salbino,
Dembert Leon, Alfredo Arcega and Peter Arcega already in appellants residence in
Buyagan.Appellant asked P10,000.00 from each of them if they wanted her to be
responsible for representing them to get themselves employed in Taiwan with a monthly
income of P15,000.00.When the group agreed, appellant made them fill up and sign a
bio-data form. Appellant also made them understand that they would each have to pay
her the total amount of P40,000.00, P10,000.00 of which was to be forthwith paid and the
balance to be paid as and when everything would have been arranged for their flight to
Taiwan.
On 23 September 1992, Belino paid appellant the amount of P10,000.00 at her
Dimasalang office. Appellant issued a cash voucher therefor. Belino returned to Baguio
City. Five days later, Belino went down to Manila after appellant had sent word that he
had to come to Manila. On 30 September 1992, Belino paid in Manila the amount
of P15,000.00 demanded by appellant. Appellant signed her name as Annie Saley on the
receipt. Appellant informed Belino that he should wait for her telephone call regarding the
schedule of his flight. He waited but when no calls came, Belino and Opdas decided to
visit appellant in her house in Buyagan. Appellant asked to be given until January to
deploy them in Taiwan. February 1993 came, and still there was no news from appellant.
In March 1993, Belino and others, namely, Fidel Opdas, Brando Salbino, Dembert Leon
and Alfredo Arcega,[18] decided to file a complaint against appellant with the POEA in
Magsaysay Avenue, Baguio City, where their sworn statements were taken.

Criminal Case No. 93-CR-1651

Peter Arcega, a 27-year-old cashier from 317 Magsaysay Avenue, Baguio City, also
paid the amount of P10,000.00 to appellant for a promised job overseas. A cash voucher
was signed by appellant to acknowledge the payment. Peter, subsequently, also paid the
amount of P15,000.00 to appellant for which the latter issued a receipt signed by Annie
Saley. He was among those who signed the affidavit-complaint before the POEA.
Testifying in Criminal Case No. 93-CR-1645,[19] as a corroborative witness, Dembert
Leon, a 25-year-old unemployed from 52-F Tandang Sora Street, Baguio City, said that
he, desiring to get an employment abroad, likewise went to see appellant at her residence
in Buyagan. Accompanied by Fidel Opdas, Leon was told by appellant to complete the
necessary papers, including his bio-data, barangay clearance, ID and NBI
clearance. Leon applied to be a factory worker in Taiwan. He was assured a monthly
salary of P12,000.00, but first, appellant told him, he should commit to pay a placement
fee of P40,000.00 of which amount P10,000.00 had to be paid forthwith. Leon paid and a
cash voucher, dated 08 September 1992, was issued by appellant. On 30 September
1992, he paid appellant another P15,000.00 for which another acknowledgment receipt
was issued. The remaining P15,000.00 was agreed to be paid at the airport before his
flight to Taiwan. No further word came from appellant. Finally, in December 1992, when
he and the others called her up, appellant informed them to wait until January
1993. January came and still nothing happened. In March 1993, Leon and the others went
to the POEA office to lodge a complaint against appellant.[20]
Jose B. Matias, an Attorney II at the POEA Regional Station Unit in Baguio City,
received a request for verification on whether or not appellant was a licensed recruiter. In
response, he advised that appellant was not authorized to recruit in the City of Baguio
and in the region from 1989 to the present. Atty. Matias issued a certification to that effect.
-0-
 The Case for the Defense. -

The defense posited the theory that appellant merely assisted the complainants in
applying for overseas employment with duly accredited travel agencies for and from which
she derived a commission.[21]
According to the 37-year-old appellant, she used to be the liaison officer of the
Friendship Recruitment Agency from 1983 to 1986. In that capacity, she would submit to
the POEA contracts for processing job orders for applicants and assist applicants prior to
their departure at the airport. When the licensed agency closed in 1986, she went to
Baguio where she engaged in the purchase and sale of vegetables and flowers. Even
then, however, she would not hesitate extending help to applicants for overseas
employment by recommending licensed agencies which could assist said applicants in
going abroad. She named the Dynasty Travel and Tours and the Mannings International
as such licensed agencies. She had, in the process, been able to help workers, like
Cherry Pi-ay, Corazon del Rosario, Arthur Juan and Francisco Labadchan to name some,
sent abroad.[22]
Cherry Pi-ay was able to leave for Kuwait. In 1991, Cherry went to see her again, this
time asking for assistance in getting an employment in Korea. She accompanied Cherry
to the Dynasty Travel and Tours in Manila that enabled her to get a tourist visa to
Korea. Appellant herself later gave Cherry her tourist visa. For Cherrys visa and plane
ticket, appellant received from Cherry P15,000.00 and US$250.00. Appellant issued a
receipt therefor and delivered the amounts to the Dynasty Travel and Tours which, in turn,
issued her a receipt. The CIS men who arrested her in Manila confiscated that receipt. In
August 1991, Cherry came back and asked her to look for another travel agency saying
she did not like the work she had in Korea.[23]
Norma Bao-idang, a former client of the Friendship Recruitment Agency, introduced
Corazon del Rosario to appellant. Since the agency had already been closed, appellant
referred Corazon to Mannings International in Kalaw Street, Ermita, Manila. Corazon was
able to leave for Abu Dhabi where she worked as a domestic helper. In 1991, Corazon
again sought appellant's assistance in getting an employment in Korea. Appellant
introduced her to Dynasty Travel and Tours which, in turn, helped Corazon get a
tourist visa for Korea. She did ask for P15,000.00 and US$250.00 from Corazon but these
amounts, being for Corazons ticket and hotel accommodation, were turned over to
Dynasty Travel and Tours. She also knew that Corazon was able to leave for Korea
because she herself handed over to Corazon her tourist visa and ticket. Appellant
received P2,000.00 from Dynasty Travel and Tours by way of commission. She was also
issued a receipt by that travel agency showing that she had turned over to it the amounts
received from Corazon but the CIS men took the receipts and otherdocuments from her.
When Corazon returned home in 1991 after going to Korea, she again sought appellants
help in looking for a travel agency that could assist her in going back to that country.[24]
Appellant came to know Arthur Juan through a vegetable vendor named Maxima
Gomez. He asked her for help in securing a tourist visa. Appellant was able to assist him
and others, like Francisco Labadchan, Tirso Gomez and Romeo Balao, by referring them
to the Dynasty Travel and Tours. Appellant asked from them the amounts of P15,000.00
and US$250.00 which she turned over to the travel agency. Again, she was issued a
receipt by that agency but that, too, was confiscated by the CIS agents who arrested
her. Of the men who sought her help in going abroad, seven "were able to leave. The
others had been re-scheduled to leave but they failed to arrive at the airport.
Labadchan and Juan met appellant during the first week of January 1993. She gave
them back the plane ticket and the amount of US$250.00 so that they could ask for a
refund from the travel agency. The next time she saw Labadchan was at the NBI office
when NBI Director Limmayog invited her for questioning. Appellant tried her best to look
for a job for Labadchan but the transaction she had with Fast International failed to push
through.[25]
Appellant helped Victoria Asil secure a tourist visa. The latters sister was a former
client at the Friendship Recruitment Agency who was able to work in Saudi Arabia in
1985. She introduced Victoria to the Dynasty Travel and Tours. Appellant asked Victoria
to advance P15,000.00 and US$250.00 for her ticket and hotel accommodation. Victoria
gave appellant the amount, and the latter issued corresponding receipts. She turned over
the amount to the travel agency which, in turn, issued a receipt to appellant. The CIS,
however, confiscated all the documents in her attache case.[26] Appellant was able to
process Victorias visa for Korea but when someone informed the latter that she could
have a visa for Taiwan, Victoria opted to change her destination. Appellant told Victoria
that her visa and ticket for Korea had already been obtained but Victoria insisted on a
refund of her money. Appellant returned to her P15,000.00 that was supposed to be the
amount to be exchanged into dollars for her show money. Victoria issued a receipt for the
amount but appellant entrusted it to her former lawyer.Appellant handed over the plane
ticket to Victoria.[27]
Mercedes Quimson (Kimson) introduced appellant to Adeline Tiangge. When Adeline
said that she was interested in securing a tourist visa for Korea, appellant took her to the
Dynasty Travel and Tours. Appellant asked from Adeline the amount of P17,000.00 for
her plane ticket. Appellant was able to buy a plane ticket and to get a passport for
Adeline. The latter, however, later said that she was no longer interested in going to Korea
and that her passport application should, instead, be diverted to Hongkong. In fact,
Adeline was able to leave for Hongkong. Adeline filed a case against appellant because
when Adeline sought a refund from Dynasty Travel and Tours, the agency only gave
her P5,000.00 or just a half of the P10,000.00 she wanted.[28]
Fidel Opdas was appellants client at the Friendship Agency who was able to leave
for Saudi Arabia. He asked her if she could find a job for him in Taiwan. When appellant
told him that she knew someone who could help, Opdas brought along Mariano
Damolog. Appellant introduced them to Marites Tapia and Carol Cornelio of Dynasty
Travel and Tours who told Opdas and Damolog to submit the necessary documents for
their application for work in Taiwan. In May 1993, Opdas returned with Brando Salbino
who also talked to Marites and Carol. Opdas submitted to appellant the documents
required by Marites and Carol. Appellant, in turn, gave the papers to Marites and
Carol. When, later, Opdas went to see appellant, he brought along Dembert Leon and
Lorenzo Belino. Appellant requested Opdas to accompany the two to Marites and Carol
with whom they discussed what would be necessary "for their application for Taiwan. Still
later when Opdas came back with Peter and Alfredo Arcega to see appellant, she again
referred them to Marites and Carol. The job applicants each gave appellant P10,000.00
which the latter turned over to Marites and Carol. The two gave her receipts but these
were in the same attache case that was seized by the CIS agents and never
returned. The group subsequently withdrew their applications although it was only Opdas
who received a P15,000.00 refund.[29]
In a bid to prove that CIS agents indeed took away her attache case containing
documents that could bail her out of the charges, appellant presented Danilo A. Deladia,
one of the three policemen who arrested her. Equipped with a warrant of arrest issued by
Judge Luis Dictado of Branch 8, the policemen went to the house of appellants cousin at
2320-B San Antonio, Sampaloc, Manila at 3:00 p.m. of 25 August 1993. According to
Deladia, however, they did not get anything from appellant because their mission was
only to arrest her. At the counter intelligence branch of the CIS, he did not even hear
appellant requesting for the return of a brief case.[30] Apparently because of what had
turned out to be Deladias adverse testimony, the defense presented George Santiago
who claimed to be at the boarding house when appellant was arrested. Santiago said that
he had allowed the CIS agents to enter the boarding house.Santiago did not see what
might have happened in appellant's room but what he did see was that when the agents
all came out, they had with them an attache case. Santiago, accompanied by his cousin
Atty. Lomboan, went to the CIS in Camp Crame where one of the men asked P50,000.00
for the release of appellant. Santiago did not see any brief case in the office but one of
the men told them that they would "produce" appellant and the attache case if they could
"produce" the amount of P50,000.00.[31]
On cross-examination, however, Santiago admitted that the P50,000.00 was meant
for bonding purposes and that they did not make a formal request for the release of the
brief case.[32]
The defense next attempted to shift, albeit unsuccessfully, the responsibility for the
crime from appellant to Maritess and Carol. Presented at the witness stand was Oscar
Gaoyen, a 30-year-old farmer, who testified that appellant had failed to assist him in going
to Korea to work because it was difficult. While following up his application in Manila, he
met Marites and Carol in front of the Dangwa station in Dimasalang and he was told that
they knew someone who could "transfer his application to Taiwan." He said that even
after he had paid appellant P50,000.00, nothing happened constraining him to file
charges against her. Appellant returned P15,000.00 of the money to him.[33]
Appellant filed, before the trial court could promulgate its decision, a Motion to
Reopen Trial with an urgent motion to defer promulgation on the ground of newly
discovered evidence.[34]In its order of 03 March 1995, the trial court, noting that the newly
discovered evidence consisted of affidavits of desistance of seven complainants, found
no merit in the motion. It held that presentation of the same does not give valid ground
for possible amendment of the decision as the private complainants had already testified.
It agreed with the prosecutor that the affidavits of desistance only (had) the effect of
satisfying the civil liability.[35]

The Judgment of the Trial Court. -

On 03 March 1995, the trial court rendered its decision finding appellant guilty beyond
reasonable doubt of the crimes charged. It found implausible appellants claim that she
was merely an agent of Dynasty Travel and Tours and/or Maritess Tapia and Carol
Cornelio. If what she claimed were true, said the court, appellant could have presented
her principals; instead, that failure exposed her to the adverse inference and legal
presumption that evidence suppressed would be adverse if produced. It also found hard
to believe, the "self-serving" claim of appellant that her brief case, supposedly containing
receipts of her remittances to the travel agencies, was confiscated by the CIS and
remained unaccounted for. The trial court concluded:
In fine, accused gave the distinct assurance, albeit false, that she had the ability to send
the complainants abroad for work deployment, thereby employing false pretenses to
defraud them. This was despite her knowing very well that she was not legally
authorized. The complainants willingly parted with their money in the hope of overseas
employment deceitfully promised them by the accused. What makes matters worse is
that these amounts given to the accused come from hard-earned money, or worse, could
have been borrowed from money lenders who have no qualms about collecting usurious
interest rates. Complainants who faithfully relied on the accused did not hesitate to
painstakingly raise or even beg or borrow money just so they could give a decent future
to their families even to the extent of leaving them for far-off lands. But now, all their
dreams are gone, their hopes shattered. Some may not have even been able to pay back
what they borrowed nor recoup their losses. Now, more than ever, their future appears
bleaker. But this time, a glimmering light appears at the end of the tunnel as the Court
steps in to lay down the iron fist of the law so as to serve the accused a lesson, a bitter
one, with the hope that those who are trekking or those who are about to trek the same
pilfered path that the accused took will reconsider their pursuits before it would be too
late, and in the end, this form of fraud which invariably victimizes the poor will forever
be stopped.[36]
All given, the trial court then decreed as follows:
WHEREFORE, in all the above-mentioned cases, the Court finds accused Antonine B.
Saley, also known as Annie B. Saley, GUILTY beyond reasonable doubt of the
corresponding crime as charged in the informations and hereby sentences her in each
case, except in Criminal Case NO. 93-CR-1645 where an indeterminate sentence is not
applicable, to suffer an indeterminate sentence for the duration hereunder given, and to
pay the costs, as well as the damages due the private complainants, to wit:

"Criminal Case No. 92-CR-1396

"Imprisonment from Four (4) Years as MINIMUM to Six (6) Years as

MAXIMUM and to pay Francisco T. Labadchan P45,000.00 for actual damages,
plus costs.

"Criminal Case No. 92-CR-1397

 "Imprisonment from Three (3) Years, Six (6) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Seven (7) Years, Four (4) Months and
One (1) Day of prision mayoras MAXIMUM and to pay Francisco T.
Labadchan P45,000.00 for actual damages, plus costs.

"Criminal Case No. 92-CR-1413

"Imprisonment from Four (4) Years as MINIMUM to Six (6) Years as

MAXIMUM and to pay Cherry Pi-ay P20,000.00 for moral damages, plus costs.

"Criminal Case No. 92-CR-1414

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Victoria
As-il P15,000.00 for actual damages, plus costs.

"Criminal Case No. 92-CR-1415

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Cherry Pi-
ay P20,000.00 for moral damages, plus costs.

"Criminal Case No. 92-CR-1416

"Imprisonment from Four (4) Years as MINIMUM to Six (6) Years as

MAXIMUM and to pay Victoria As-il P15,000.00 for actual damages, plus
costs.

"Criminal Case No. 92-CR-1425

"Imprisonment from Four (4) Years as MINIMUM to Six (6) Years as

MAXIMUM and to pay Corazon del Rosario P20,000.00 for moral damages,
plus costs.

"Criminal Case No. 92-CR-1426

"Imprisonment from One (1) Year, Seven (7) Months and Eleven (11) Days
of prision correccional as MINIMUM to Six (6) Years, Five (5) Months and
Eleven (11) Days of prision mayor as MAXIMUM and to pay Corazon del
Rosario P20,000.00 for moral damages, plus costs.

"Criminal Case No. 92-CR-1427

"Imprisonment from Four (4) Years as MINIMUM to Six (6) Years as

MAXIMUM and to pay the costs.

"Criminal Case No. 92-CR-1428

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay the costs.

"Criminal Case No. 93-CR-1644

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Alfredo C.
Arcega P25,000.00 for actual damages, plus costs.

"Criminal Case No. 93-CR-1645

 "To suffer the penalty of life imprisonment and to pay a fine of One Hundred
Thousand Pesos (P100,000.00), with subsidiary imprisonment in case of
insolvency, and to pay the costs. She shall also pay Twenty-Five Thousand Pesos
(P25,000.00) each to Peter Arcega, Lorenzo Belino, Mariano Damolog, Brando
Salbino, Dembert Leon and Alfredo Arcega for actual damages, plus costs.

"Criminal Case No. 93-CR-1646

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Brando B.
Salbino P25,000.00 for actual damages, plus costs.

"Criminal Case No. 93-CR-1647

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Mariano
Damolog P25,000.00 for actual damages, plus costs.

Criminal Case No. 93-CR-1649

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Lorenzo
Belino P25,000.00 for actual damages, plus costs.

"Criminal Case No. 93-CR-1651

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Peter
Arcega P25,000.00 for actual damages, plus costs.

"Criminal Case No. 93-CR-1652

"Imprisonment from One (1) Year, Eight (8) Months and Twenty-One (21) Days
of prision correccional as MINIMUM to Five (5) Years, Five (5) Months and
Eleven (11) Days of prision correccional as MAXIMUM and to pay Adeline
Tiangge y Marcos P17,000.00 for actual damages, plus costs.
"With respect to accused Conchita Tagle in Criminal Cases Nos. 92-CR-1396 and 92-
CR-1397, let these cases be sent to the files without prejudice to their revival as soon as
she shall have been arrested and brought to the jurisdiction of this Court.
"In order that Conchita Tagle may not escape the clutches of the law, let Alias Warrants
of Arrest issue addressed to the PNP Chief of Police, La Trinidad, Benguet and the
National Bureau of Investigation (NBI) in Manila and in Baguio City. Further, the
Commission of Immigration and Deportation (CID), Manila is ordered to include her
name in the its Hold-Departure List.
"SO ORDERED.[37]
Appellant filed a motion for reconsideration of the decision asserting that the trial court
had erred in giving credence to the testimonies of the complaining witnesses and in
finding her guilty of the crimes charged despite the "failure" of the prosecution to fully
establish the elements of the crimes beyond reasonable doubt.[38] Finding no merit in the
motion, the trial court, on 03 April 1995, denied a reconsideration of its decision. [39] The
following day, appellant filed a notice of appeal.[40] The trial court gave due course to the
appeal on 17 April 1995.[41]

The Instant Appeal. -

 Appellant continues to profess before this Court her innocence of the accusation. She
reiterates her assertion that the trial court has erred in giving credence to the testimonies
of the complaining witnesses and in finding her guilty beyond reasonable doubt of the
various offenses she has been charged with by the prosecution. [42] She avers that her
transactions with the complainants have been limited to her assisting them secure their
respective travel visa specifically for tourist and that her assistance to them (has been)
only to refer them to travel agencies such as the Dynasty Travel and Tours and the
Mannings International. She insists that she has remitted the amounts solicited from the
complainants to the travel agencies, or to Maritess Tapia and Carol Cornelio, earning only
the commissions for bringing in clients interested in getting tourist visas.[43]
At the outset, it might be explained that this appeal involves the conviction of appellant
not only for the crime of illegal recruitment in large scale for which the penalty of life
imprisonment is imposed but also for other offenses for which lesser penalties have been
meted by the trial court upon appellant. This Court has appellate jurisdiction over ordinary
appeals in criminal cases directly from the Regional Trial Courts when the penalty
imposed is reclusion perpetua or higher.[44] The Rules of Court, allows,
however, the appeal of criminal casesinvolving penalties lower than reclusion
perpetua or life imprisonment under the circumstances stated in Section 3, Rule 122, of
the Revised Rules of Criminal Procedure. Thus -
(c) The appeal to the Supreme Court in cases where the penalty imposed is life
imprisonment, or where a lesser penalty is imposed but involving offenses committed on
the same occasion or arising out of the same occurrence that gave rise to the more
serious offense for which the penalty of death or life imprisonment is imposed shall be
by filing a notice of appeal in accordance with paragraph (a) of this Section.
In giving due course to the notice of appeal filed by appellant, the trial court has directed
that the entire records of the seventeen cases should be forwarded to this Court. [45] It
might be observed that this appeal, which has been assigned only one docket number,
involves cases, although spawned under different circumstances could be said to
somehow be linked to the incident giving rise to the case for illegal recruitment in large
scale. The cases have thus been correctly consolidated and heard jointly below. The
appeal made directly to this Court of the seventeen cases, each of which incidentally
should have been assigned a separate docket number in this Court, is properly taken.
Article 38(a) of the Labor Code considers illegal any recruitment activity undertaken
by non-licensees or non-holders of authority. Recruitment is defined by Article 13,
paragraph (b), of the same Code as referring -
x x x to any act of canvassing, enlisting, contracting, transporting, utilizing, hiring or
procuring workers, and includes referrals, contract services, promising or advertising for
employment, locally or abroad, whether for profit or not; Provided, That any person or
entity which, in any manner, offers or promises for a fee employment to two or more
persons shall be deemed engaged in recruitment and placement.
Illegal recruitment is committed when two elements concur:
1) That the offender has no valid license or authority required by law to enable one
to lawfully engage in recruitment and placement of workers; and
2) That the offender undertakes either any activity within the meaning of
recruitment and placement defined under Article 13(b), or any prohibited
practices enumerated under Article 34.[46]
Any person who commits the prohibited acts enumerated in Article 13(b) of the Labor
Code shall be liable under Article 38(a) thereof.[47] The proviso in Article 13(b) lays down
a rule of evidence that where a fee is collected in consideration of a promise or offer of
employment to two or more prospective workers, the individual or entity dealing with them
shall be deemed to be engaged in the act of recruitment and placement. [48] The article
also provides that recruitment includes the act of referral or the act of passing along or
forwarding of an applicant for employment after an initial interview of a selected applicant
for employment to a selected employer, placement officer or bureau.[49]
The Court agrees with the trial court that appellant, indeed, violated the law against
illegal recruitment.
 The prosecution was able to prove by overwhelming evidence that appellant did
represent herself as being in a position to get for the aspiring overseas contract workers
good-paying jobs abroad. Appellant was thus able to demand and receive various
amounts from the applicants. The latter would then be briefed by appellant on the
requirements for employment overseas. Appellant herself testified, thus:
Q From 1986 when separated from Friendship Recruitment Agency and before you
were put to jail did you have any occupation?
"A Yes, sometimes we brought vegetables and flowers to Manila for resale.
"Q Aside from buying and selling vegetables down in Manila did you have any other
source of income?
"A Sometimes I helped some applicants who are interested to go abroad and asked
if I know some agencies who can assist them to go abroad.
"Q Were you able to assist some people to look for an agency to assist them to go
abroad?
"A Yes, sir.
"Q Were you being paid when you assist these people applying for overseas
employment?
"A Yes, sir.
"Q By whom?
"A The travel agencies give me some amount of commission.
"Q What are the names of these agencies which you know?
"A Dynasty Travel and Tours and Mannings International.
"x x x x x x x x x.
"Q Do you know also if this Dynasty Travel and Tours and Mannings International is
duly licensed by the government to recruit applicants abroad?
"A Yes, sir.
"Q Do you have any document to prove that it is registered?
"A Yes, sir.
"Q Where is that?
"A Mannings International is a licensed agency and Dynasty Travel and Tours is
licensed to issue tickets for applicants to go abroad.
"Q You said that Dynasty Travel and Tours is licensed to issue tickets for applicants
going abroad what do you mean by applicants going abroad?
"A Those applicants to work as a contract worker and who are ready to leave for
abroad and they are being issued tickets.
"Q Were you actually able to help or assist some overseas worker-applicants?
"A Yes, sir.
"Q Do you remember some of them?
"A Cherry Piay, Corazon del Rosario, Arthur Juan, Francisco Labadchan and others.
(Underscoring supplied.)[50]
Appellant at one point claimed that she had helped complainants only in acquiring for
them plane tickets and tourist visas. On cross-examination, however, she admitted that
she had made referrals of job applicants to recruitment agencies. [51] She evidently knew
all along that the persons she was dealing with were applicants for employment abroad.
The law requires that the above activities of appellant should have first been
authorized by the POEA.[52] Rule II, Book II, of the POEA Rules and Regulations
Governing Overseas Employment provides:
 SEC. 11. Appointment of Representatives. Every appointment of representatives or
agents of licensed agency shall be subject to prior approval or authority of the
Administration.
"The approval may be issued upon submission of or compliance with the following
requirements:

"a. Proposed appointment or special power of attorney;

"b. Clearances of the proposed representative or agent from NBI;

"c. A sworn or verified statement by the designating or appointing person or company

assuming full responsibility for all acts of the agent or representative done in
connection with the recruitment and placement of workers.

"Approval by the Administration of the appointment or designation does not authorize

the agent or representative to establish a branch or extension office of the licensed
agency represented.
"Any revocation or amendment in the appointment should be communicated to the
Administration. Otherwise, the designation or appointment shall be deemed as not
revoked or amended.
The claim that appellant did not categorically represent herself as a licensed recruiter,
or that she merely helped the complainants secure tourist visas, could not make her less
guilty of illegal recruitment,[53] it being enough that he or she gave the impression of
having had the authority to recruit workers for deployment abroad.[54]
The fact that, with the exception of the cases involving Cherry Pi-ay and Corazon del
Rosario, only the complainant in each of the cases, have testified against appellant in the
illegal recruitment cases does not thereby make the case for the prosecution weak. The
rule has always been that the testimony of witnesses is to be weighed, not that the
witnesses be numbered, and it is not an uncommon experience to have a conclusion of
guilt reached on the basis of the testimony of a single witness.[55] Corroborative evidence
is necessary only when there are reasons to warrant the suspicion that the witness has
perjured himself or that his observations have veered from the truth. [56]
The absence of receipts to evidence payment to an indictee in a criminal case for
illegal recruitment does not warrant an acquittal of the accused, and it is not necessarily
fatal to the prosecution's cause. As long as the prosecution is able to establish through
credible testimonial evidence that the accused has involved himself in an act of illegal
recruitment, a conviction for the offense can very well be justified.[57]
Altogether, the evidence against appellant has established beyond any discernible
shadow of doubt that appellant is indeed guilty of illegal recruitment on various
counts. Being neither a licensee nor a holder of authority to recruit, appellant must suffer
under Article 39(c) of the Labor Code the penalty of imprisonment of not less than four
years nor more than eight years or a fine of not less than P20,000.00 nor more
than P100,000.00 or both such imprisonment and fine, at the discretion of the court. In
imposing the penalty, the provisions of the Revised Penal Code on the application of the
circumstances that could modify the criminal liability of an accused cannot be considered,
these provisions being inapplicable to special laws.[58]
Under the Indeterminate Sentence Law,[59] whenever the offense is punishable by a
special law, the court shall impose on the accused an indeterminate sentence, "the
maximum term of which shall not exceed the maximum fixed by said law and the minimum
shall not be less than the minimum term prescribed by the same." [60] Accordingly, in
imposing the penalty of four (4) years to six (6) years on appellant for each of the five
cases of illegal recruitment, the trial court has acted correctly.
Illegal recruitment is committed in large scale if it is perpetrated against three or more
persons "individually or as a group." Its requisites are that: (1) the person charged with
the crime must have undertaken recruitment activities as so defined by law, (2) the same
person does not have a license or authority to do that, and (3) the questioned act is
committed against three or more persons.[61] The prosecution has been able to
successfully show that, for a fee, appellant, not being authorized to recruit workers for
abroad, did so in Criminal Case No. 93-CR-1645 against seven complainants. For this
offense, Article 39(a) of the Labor Code imposes the penalty of life imprisonment and a
fine of one hundred thousand pesos (P100,000.00). This penalty was thus likewise aptly
meted out upon appellant by the trial court.
Conviction for these various offenses under the Labor Code does not bar the
punishment of the offender for estafa. Illegal recruitment is a malum prohibitum offense
where criminal intent of the accused is not necessary for conviction while estafa is malum
in se which requires criminal intent to warrant conviction.[62] Under Article 315, paragraph
2(a),[63] of the Revised Penal Code, the elements of the offense (estafa) are that (1) the
accused has defrauded another by abuse of confidence or by means of deceit and (2)
damage or prejudice capable of pecuniary estimation is caused to the offended party or
third person.[64] Clearly, these elements have sufficiently been shown in the cases under
review.
The penalty for the crime is prescribed by Article 315, first to fourth paragraphs, of
the Revised Penal Code as follows:
1st. The penalty of prision correccional in its maximum period to prision mayor in its
minimum period, if the amount of the fraud is over 12,000 pesos but does not exceed
22,000 pesos, and if such amount exceeds the latter sum, the penalty provided in this
paragraph shall be imposed in its maximum period, adding one year for each additional
10,000 pesos; but the total penalty which may be imposed shall not exceed twenty years.
In such cases, and in connection with the accessory penalties which may be imposed and
for the purpose of the other provisions of this Code, the penalty shall be termed prision
mayor or reclusion temporal, as the case may be.
2nd. The penalty of prision correccional in its minimum and medium periods, if the
amount of the fraud is over 6,000 pesos but does not exceed 12,000 pesos;
"3rd. The penalty of arresto mayor in its maximum period to prision correccional in its
minimum period if such amount is over 200 pesos but does not exceed 6,000 pesos; and
"4th. By arresto mayor in its maximum period, if such amount does not exceed 200
pesos, provided that in the four cases mentioned, the fraud be committed by any of the
following means: x x x."
In the case of People vs. Gabres,[65] the Court has had occasion to so state that -
"Under the Indeterminate Sentence Law, the maximum term of the penalty shall be `that
which, in view of the attending circumstances, could be properly imposed' under the
Revised Penal Code, and the minimum shall be `within the range of the penalty next
lower to that prescribed' for the offense. The penalty next lower should be based on the
penalty prescribed by the Code for the offense, without first considering any modifying
circumstance attendant to the commission of the crime. The determination of the
minimum penalty is left by law to the sound discretion of the court and it can be
anywhere within the range of the penalty next lower without any reference to the periods
into which it might be subdivided. The modifying circumstances are considered only in
the imposition of the maximum term of the indeterminate sentence.
"The fact that the amounts involved in the instant case exceed P22,000.00 should not be
considered in the initial determination of the indeterminate penalty; instead, the matter
should be so taken as analogous to modifying circumstances in the imposition of the
maximum term of the full indeterminate sentence. This interpretation of the law accords
with the rule that penal laws should be construed in favor of the accused. Since the
penalty prescribed by law for the estafa charge against accused-appellant is prision
correccional maximum to prision mayor minimum, the penalty next lower would then
be prision correccional minimum to medium. Thus, the minimum term of the
indeterminate sentence should be anywhere within six (6) months and one (1) day to
four (4) years and two (2) months x x x."[66]
The Court reiterates the above rule; however, in fixing the maximum term, the prescribed
penalty of prision correccional maximum period to prision mayor minimum period should
be divided into "three equal portions of time," each of which portion shall be deemed to
form one period; hence -

Minimum Period Medium Period Maximum Period

From 4 years, 2 months From 5 years, 5 months From 6 years, 8 months
and 1 day to 5 years, and 11 days to 6 years, and 21 days to 8 years
5 months and 10 days 8 months and 20 days -
in consonance with Article 65,[67] in relation to Article 64,[68] of the Revised Penal Code.
When the amount involved in the offense exceeds P22,000.00, the penalty
prescribed in Article 315 of the Code "shall be imposed in its maximum period," adding
one year for each additional P10,000.00 although the total penalty which may be imposed
shall not exceed 20 years. The maximum penalty should then be termed as prision
mayor or reclusion temporal as the case may be. In fine, the one year period, whenever
applicable, shall be added to the maximum period of the principal penalty of anywhere
from 6 years, 8 months and 21 days to 8 years.
Accordingly, with respect to the cases of estafa filed by the complainants who
individually charged appellant with illegal recruitment, the applicable penalties would,
respectively, be, as follows:
In Criminal Case No. 92-CR-1397 where appellant defrauded Francisco T.
Labadchan in the amount of P45,000.00, two years for the additional amount
of P23,000.00 in excess of P22,000.00 provided for in Article 315 shall be added to the
maximum period of the prescribed penalty of prision correccional maximum to prision
mayor minimum (or added to anywhere from 6 years, 8 months and 21 days to 8 years).
As such, aside from paying Labadchan the amount of P45,000.00 by way of actual
damages, the Court deems it proper to sentence appellant to the indeterminate penalty
of three (3) years, six (6) months and twenty-one (21) days of prision
correccional medium to eight (8) years, eight (8) months and twenty-one (21) days
of prision mayor medium.
In Criminal Case No. 92-CR-1414, appellant defrauded Victoria Asil in the amount
of P15,000.00. Hence, aside from paying Victoria Asil the amount of P15,000.00 by way
of actual damages, appellant shall also suffer the indeterminate penalty of one (1) year,
eight (8) months and twenty-one (21) days of prision correccional medium to five (5)
years, five (5) months and eleven (11) days of prision correccional maximum.
In Criminal Case No. 92-CR-1415 where appellant defrauded Cherry Pi-ay in the
amount of P18,000.00, appellant, besides paying Cherry Pi-ay that amount by way of
actual damages, shall also suffer the indeterminate penalty of one (1) year, eight (8)
months and twenty-one (21) days of prision correccional minimum to five (5) years, five
(5) months and eleven (11) days of prision correccional maximum.
In Criminal Case No. 92-CR-1426 where appellant defrauded Corazon del Rosario in
the amount of P40,000.00, appellant shall suffer the indeterminate penalty of two (2)
years, four (4) months and one (1) day of prision correccional medium to seven (7) years,
eight (8) months and twenty-one (21) days of prision mayor minimum.
In Criminal Case No. 92-CR-1428 where appellant fraudulently solicited the amount
of P24,200.00 from Arthur Juan, appellant shall pay him actual damages in that amount
and shall suffer the indeterminate penalty of from one (1) year, eight (8) months and
twenty-one (21) days (imposed by the court a quo) of prision correccional minimum
period to six (6) years, eight (8) months and twenty-one (21) days of prision
mayor minimum.
In Criminal Case No. 92-CR-1652 where appellant defrauded Adeline Tiangge the
amount of P18,500.00, appellant shall pay her the same amount as actual damages and
shall suffer the indeterminate penalty of from one (1) year, eight (8) months and twenty-
one (21) days of prision correccional minimum to five (5) years, five (5) months and
eleven (11) days of prision correccional maximum.
In Criminal Case No. 93-CR-1645, the prosecution has successfully established its
case against appellant for illegal recruitment in large scale. Evidently banking on her
reputation in the community as a job recruiter, appellant was able to make the seven
complainants believe that they could land various jobs in Taiwan. Confident of her
assurances, each complainant parted with P25,000.00 for supposed processing and
placement fees.
 It would appear that of the seven complainants for illegal recruitment in large scale,
only five[69] of them filed separate charges of estafa against appellant. Accordingly,
appellant was only and could only be held liable for five counts of estafa arising from the
charge of illegal recruitment in large scale. Since appellant collected the amount
of P25,000.00 from each of the five (5) victims, she must be held subject to the penalty in
its maximum period or prision mayor in its minimum period (not any higher on account of
the fact that the amount in excess of P22,000.00 provided for by Article 315 of the Revised
Penal Code is less than P10,000.00).[70] Applying the Indeterminate Sentence Law, and
there being no attending circumstances, appellant shall bear, the indeterminate penalty
of one (1) year, eight (8) months and twenty-one (21) days of prision correccional medium
as minimum penalty to six (6) years, eight (8) months and twenty-one (21) days of prision
mayor minimum as maximum penalty for each offense. In addition, appellant should pay
the five (5) victims the amount of P25,000.00 each as actual damages.
The actual damages awarded here shall be subject to diminution or cancellation
should it be shown that appellant had already paid the complainants.
WHEREFORE, the Decision finding appellant guilty beyond reasonable doubt of the
crimes of illegal recruitment, illegal recruitment in large scale and estafa is hereby
AFFIRMED subject to the modifications hereunder specified, and only to the extent
thereof, in the following cases:

1) In Criminal Case No. 92-CR-1397, accused-appellant is sentenced to an indeterminate

penalty of imprisonment of from three (3) years, six (6) months and twenty-one (21) days
of prision correccionalmedium period as MINIMUM, to eight (8) years, eight (8) months and
twenty-one (21) days of prision mayor medium period as MAXIMUM and to pay Francisco T.
Labadchan the amount of P45,000.00 by way of actual damages.

2) In Criminal Case No. 92-CR-1414, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to five (5) years, five (5) months and eleven (11)
days of prision correccional maximum period as MAXIMUM and to pay Victoria Asil the
amount of P15,000.00 by way of actual damages.

3) In Criminal Case No. 92-CR-1415, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to five (5) years, five (5) months and eleven (11)
days of prision correccional maximum period as MAXIMUM.

4) In Criminal Case No. 92-CR-1426, accused-appellant is sentenced to an indeterminate

penalty of imprisonment of from two (2) years, four (4) months and one (1) day of prision
correccional medium period as MINIMUM, to seven (7) years, eight (8) months and twenty-one
(21) days of prision mayor minimum period as MAXIMUM.

5) In Criminal Case No. 92-CR-1428, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to six (6) years, eight (8) months and twenty-one
(21) days of prision mayor minimum period as MAXIMUM.

6) In Criminal Case No. 93-CR-1644, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to six (6) years, eight (8) months and twenty-one
(21) days of prision mayor minimum period as MAXIMUM and to pay Alfredo Arcega the
amount of P25,000.00 by way of actual damages.

7) In Criminal Case No. 93-CR-1646, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to six (6) years, eight (8) months and twenty-one
(21) days of prision mayor minimum period as MAXIMUM and to pay Brando Salbino the
amount of P25,000.00 by way of actual damages.

8) In Criminal Case No. 93-CR-1647, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to six (6) years, eight (8) months and twenty-one
(21) days of prision mayor minimum period as MAXIMUM and to pay Mariano Damolog the
amount of P25,000.00 by way of actual damages.

9) In Criminal Case No. 93-CR-1649, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to six (6) years, eight (8) months and twenty-one
(21) days of prision mayor minimum period as MAXIMUM and to pay Lorenzo Belino the
amount of P25,000.00 by way of actual damages.

10) In Criminal Case No. 93-CR-1651, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to six (6) years, eight (8) months and twenty-one
(21) days of prision mayor minimum period as MAXIMUM and to pay Peter Arcega the amount
of P25,000.00 by way of actual damages.

11) In Criminal Case No. 92-CR-1652, accused-appellant is sentenced to an indeterminate

penalty of from one (1) year, eight (8) months and twenty-one (21) days of prision
correccional minimum period as MINIMUM, to five (5) years, five (5) months and eleven (11)
days of prision correccional maximum period as MAXIMUM and to pay Adeline Tiangge the
amount of P17,000.00 by way of actual damages.

The awards of damages in Criminal Cases No. 92-CR-1396, No. 92-CR-1413, No.
92-CR-1416, No. 92-CR-1425, and No. 92-CR-1427, all for illegal recruitment, as well as
No. 93-CR-1645 for illegal recruitment in large scale, except for the award of P25,000.00
by way of actual damages to Dember Leon (no estafa case having been instituted), are
DELETED, either because similar awards have already been provided for by the trial
court, or for insufficiency of proof, in the estafa cases aforenumbered.
Costs against accused-appellant.
SO ORDERED.
Davide, Jr., Bellosillo, Panganiban, and Quisumbing, JJ., concur.
CASE#13

THIRD DIVISION

[G.R. No. 142981. August 20, 2002]

PEOPLE OF THE PHILIPPINES, appellee, vs. CARMELITA ALVAREZ, appellant.

DECISION
PANGANIBAN, J.:

In illegal recruitment, mere failure of the complainant to present written receipts for
money paid for acts constituting recruitment activities is not fatal to the prosecution,
provided the payment can be proved by clear and convincing testimonies of credible
witnesses.

The Case

Before us is an appeal from the January 28, 2000 Decision [1] of the Regional Trial
Court (RTC) of Quezon City, Branch 93, in Criminal Case No. Q-94-58179. The assailed
Decision disposed as follows:

WHEREFORE, the foregoing premises, the court finds the accused CARMELITA ALVAREZ
guilty of Illegal Recruitment committed in large scale constituting economic
sabotage. Accordingly, the court sentences her to serve [the] penalty of life imprisonment and to
pay a fine [of] P100,000.00. She is further ordered to indemnify the following complaining
witnesses in the amounts indicated opposite their names:

Arnel Damian P 16,500.00

Joel Serna P 18,575 plus US$50.00
Antonio Damian P 6,975.00 plus US$50.00
Roberto Alejandro P 47,320.00[2]

The July 18, 1994 Information[3] was filed by State Prosecutor Zenaida M. Lim. It
charged Carmelita Alvarez with illegal recruitment committed in large scale, under Article
13(b) in relation to Articles 38(a), 34 and 39 of the Labor Code of the Philippines, as
follows:

That sometime between the period from November, 1993 to March, 1994, in Quezon City, Metro
Manila, Philippines, and within the jurisdiction of this Honorable Court, the above-named
accused, did then and there willfully, unlawfully and feloniously recruit the herein complainants,
namely: JESUS G. ESMA, JR., JOEL G. SERNA, ARNEL C. DAMIAN, ANTONIO C.
DAMIAN, RUBEN F. RIOLA, LORETA S. BOLOTAOLA, EDGAR R. BARCENAS, DENO
A. MANACAP, JERRY NEIL D. ABANILLA, ROBERTO ALEJANDRO, ESTER S.
BONDOC and JOSEPHINE LOMOCSO as contractworkers in Taiwan for and in consideration
of the sum ranging from P12,300.00 to P48,600.00, as placement and processing fees, and x x x
which the complainants delivered and paid to herein accused the said amount, without said
accused first having secured the necessary license or authority from the Philippine Overseas
Employment Administration.[4]

On arraignment, appellant, assisted by Atty. Donato Mallabo, pleaded not

guilty.[5] After trial in due course, the RTC rendered the assailed Decision.

The Facts
 Version of the Prosecution

The evidence for the prosecution is summarized by the Office of the Solicitor General
(OSG) as follows:

Arnel Damian is one of the complainants in the case at bar. He testified that he was introduced
to appellant by Reynaldo Abrigo, who was then the boyfriend of Teresita Gonzales (daughter of
appellant Carmelita Alvarez) at appellants house in 25-B West Santiago St., San Francisco del
Monte, Quezon City. During said meeting, appellant convinced complainant that if he could
produce [t]wenty-[f]ive [t]housand [p]esos (P25,000.00), he would be deployed to Taiwan as a
factory worker and would be receiving a salary of $600.00.

On December 27, 1993, complainant gave appellant [t]welve [t]housand [f]ive [h]undred [p]esos
(P12,500) for which he was issued a receipt (Exhibit A) with the words FOR PROCESSING
FEE written therein by appellant herself. Aside from the processing fee, complainant also gave
appellant [t]wo [t]housand [f]ive [h]undred [p]esos ([P]2,500.00) for medical expenses and one
thousand five hundred pesos (P1,500.00) for the passport, but was not issued a receipt for said
payments.

According to complainant, while waiting for the results of his medical examination, he received
a call informing him that appellant was arrested. Becoming suspicious, complainant then went to
the Philippine Overseas and Employment Administration (POEA) to verify whether appellant
had a license to recruit. As per Certification issued by the POEA on June 1, 1994, he found out
that appellant was not licensed to recruit. Realizing that appellant would never be able to send
complainant to Taiwan, he filed a complaint against appellant with the POEA.

On cross-examination, complainant clarified that Reynaldo Abrigo did not actually introduce
him to appellant, but merely gave appellants address and telephone number. Thereafter,
complainant went to appellants house together with Ruben Riola and Michael Lumahan. In
addition, complainant stated under cross-examination that appellant told him that according to
the medical examination results, complainant was unfit to work. Consequently, he demanded the
return of his money but appellant failed to do so.

Antonio Damian is also one of the complainants in the case at bar. He testified that he is the
brother of Arnel Damian and that when his brother failed the medical examination, his brother
Arnel immediately demanded from appellant the return of the processing fee. However, appellant
could not return the money to him anymore. Instead, appellant asked Arnel to look for another
applicant in order to save the processing fee. For which reason, Arnel asked his brother Antonio
to apply in his stead. During his first meeting with appellant on January 4, 1994, complainant
Antonio Damian was asked to pay [t]wo [t]housand [f]ive [h]undred [p]esos (P2,500.00) for
medical examination. Subsequently, he also gave [n]ine [h]undred [p]esos (P900.00) for
insurance; [s]eventy-[f]ive [p]esos (P75.00) for Pre-departure Orientation Seminar; [f]ifty
[d]ollars ($50.00) as part of the processing fee; and [t]hree [t]housand [f]ive [h]undred [p]esos
(P3,500.00) for the birth certificate. All of these were personally given to appellant
but no receipts were issued by appellant. As with all the other complainants, appellant promised
Antonio that he would work as factory worker in Taiwan and that he would receive a salary of
[t]wenty-[f]ive [t]housand [p]esos (P25,000.00). After waiting for two (2) months, Antonio
learned that appellant was arrested. Hence, he filed his complaint with the POEA against
appellant.

Joel Serna came to know of appellant also through Reynaldo Abrigo. He met appellant at her
house at 25-B West Santiago St., San Francisco Del Monte, Quezon City on February 8,
1994. Like the others, Joel was promised employment in Taiwan as factory worker and was also
asked to pay various fees. Appellant gave him a list of the fees to be paid which
included: Processing fee P12,500.00; Medical examination P2,395.00; Passport P1,500.00; Visa
fee - $50.00; and Insurance P900.00. Appellants telephone number was also included in said
list. According to complainant Joel, said list was personally prepared by appellant in his
presence. Complainant Joel paid the various fees but was never issued any receipt for said
payment despite demands from appellant. Upon learning that appellant was arrested for illegal
recruitment, he went to the POEA and filed his complaint against appellant.
Roberto Alejandro testified that Onofre Ferrer, a provincemate, informed him that there were
applicants needed for the job in Taiwan. On March 6, 1994, both of them went to appellants
house where complainant Roberto was told by appellant that she had the capacity to send him to
Taiwan but he must first undergo medical examination.

Later, when Roberto was informed that he passed the medical examination, appellant told him to
bring [f]orty [t]housand [p]esos (P40,000) as processing fee and other documentary
requirements. A receipt was issued by appellant for the payment of said amount.

On March 9, 1994 appellant advised him to pay an additional [f]ive [t]housand (P5,000.00)
which he personally delivered to appellant on March 11, 1994. A receipt was also issued by
appellant for said amount.

After three (3) months of waiting and follow-up without any positive results, complainant filed
his complaint against appellant with the POEA.

David Umbao was presented on rebuttal by the prosecution and testified that on June 1, 1994, an
entrapment operation was conducted against Carmelita Alvarez where Jerry Neil Abadilla and an
agent by the name of Conchita Samones gave appellant the amount of P5,000.00 with a P500.00
bill marked as payment for the renewal of the promise of deployment. After appellant took the
money, she was immediately apprehended. Two witnesses were present during the entrapment
operations, one from the barangay and one from the homeowners association. The affidavit of
arrest setting out the details of the entrapment operation and the arrest was collectively executed
by the entrapment team.[6] (Citations omitted)

Version of the Defense

In her Brief,[7] appellant submits her own version of the facts as follows:

CARMELITA ALVAREZ testified that sometime in 1991, she met Director Angeles Wong at
the Office of the Deputy Administrator of the POEA, Manuel Quimson, who happened to be her
compadre.Sometime in November 1993, Director Wong called her about a direct-hire scheme
from Taiwan which is a job order whereby people who want to work abroad can apply directly
with the POEA. The said director told her that there were six (6) approved job orders from Labor
Attache Ellen Canasa. Seeing this as a good opportunity for her son, Edelito Gonzales, who was
then a new graduate, she recommended him and his sons friends, namely, Reynaldo Abrigo,
Renato Abrigo and two others surnamed Lucena, for employment. Unfortunately, Director Wong
called off the scheduled departure because the quota of workers for deployment was not met. To
remedy the situation, she approached Josephine Lomocso and a certain recruiter named Romeo
Dabilbil, who also recommends people to Director Wong with ready passports. When the thirty
(30) slots needed for the direct-hiring scheme were filed up, Director Wong set the tentative
schedule of departure on February 23, 1994. In view of the said development, Mr. Dabilbil
contacted the recruits from Cebu who even stayed at her (Conchitas) place in Capiz Street, Del
Monte, Quezon City for three (3) days to one (1) week while waiting to be deployed. On the
night of their scheduled departure and while they were having their despidida party, Director
Wong sent a certain Ross to inform them that a telex was received by him informing him
(Director Wong) that the factory where the recruits were supposed to work was gutted by a
fire. She was later advised by Director Wong to wait for the deployment order to come from
Taiwan. While the people from Cebu were staying in her house waiting for development, the
accused even advised them to file a complaint against Mr. Dabilbil before the Presidential Anti-
Crime Commission at Camp Crame. Surprisingly, she was also arrested for illegal recruitment on
May 31, 1994 and thereafter learned that on June 1, 1994, the Damian brothers filed a complaint
against her before the POEA. After her apprehension, the accused further testified that there was
some sort of negotiation between her lawyer, Atty. Orlando Salutandre, and the apprehending
officer, Major Umbao, regarding her release. According to her, if she [would] be able to raise the
amount of [t]hirty [t]housand [p]esos (P30,000.00), Major Umbao [would] not anymore refer her
for inquest, but would only recommend her case for further investigation and then she would be
released.Since she failed to raise the said amount, she was brought to the inquest fiscal.
REYNALDO ABRIGO testified that it was Director Angeles Wong who was actually recruiting
workers for deployment abroad because of a certain document which Alvarez showed to them
bearing the name of the said POEA Official.

EDELITO GONZALES testimony merely corroborated the testimony of defense witnesses

Carmencita Alvarez and Reynaldo Abrigo.

xxxxxxxxx

SUR-REBUTTAL EVIDENCE:

MARITES ABRIGO testified that while she was in the living room and her mother, accused
Carmelita Alvarez, was in her room inside their house on May 31, 1994, a group of persons
arrived and asked where her mother was. After telling them that her mother was inside her room
resting, a certain Major Umbao, together with some other persons, went straight to her mothers
room and knocked on the door.When her mother opened it and peeped through the opening of
the door, they immediately grabbed her. She was not able to do anything also, other than to tell
them that she has to consult first her lawyer.When her mother was brought to the POEA office
she was told that they have to produce P30,000.00.[8] (Citations omitted)

Ruling of the Trial Court

The trial court accorded full credibility to the prosecution witnesses. It held that
complainants had not been impelled by ill motives in filing the case against
appellant. They all positively identified her as the person who, without the requisite license
from the government, had collected from them processing and placement fees in
consideration of jobs in Taiwan.
The trial court was convinced that appellant had deceived complainants by making
them believe that she could deploy them abroad to work, and that she was thus able to
milk them of their precious savings. The lack of receipts for some amounts that she
received from them did not discredit their testimonies. Besides, her precise role in the
illegal recruitment was adequately demonstrated through other means.
Further affirming her illegal recruitment activities was the entrapment conducted, in
which she was caught receiving marked money from a certain Jerry Neil Abadilla, to
whom she had promised a job abroad.
Her defense that she merely wanted to provide jobs for her son-in-law and his friends
was rejected, because she had subsequently retracted her allegation implicating Director
Wong of the POEA in her illegal recruitment activities. As she victimized more than three
(3) persons, the RTC convicted her of illegal recruitment committed in large scale.
Hence, this appeal.[9]

Issue

Appellant submits this lone assignment of error:

The court a quo gravely erred in finding accused-appellant Carmelita Alvarez guilty beyond
reasonable doubt for illegal recruitment in large scale.[10]

More specifically, appellant questions the sufficiency of the prosecution evidence

showing the following: (1) that she engaged in acts of illegal recruitment enumerated in
Article 38 of the Labor Code, (2) that she was not licensed to recruit, (3) that she received
money from complainants despite the absence of receipts, and (4) that her acts
constituted illegal recruitment in large scale.

This Courts Ruling

 The appeal has no merit.

Main Issue:
Bases for Her Conviction

Appellant denies that she engaged in any act of illegal recruitment and claims that
she only recommended, through Director Wong of the POEA, her son-in-law and his
friends for a direct-hire job in Taiwan.
We disagree. Prior to the enactment of RA No. 8042, the crime of illegal recruitment
was defined under Article 38(a) in relation to Articles 13(b) and 34 and penalized under
Article 39 of the Labor Code. It consisted of any recruitment activity, including the
prohibited practices enumerated under Article 34 of the Code, undertaken by a non-
licensee or non-holder of authority.It is committed when two elements concur: (1) the
offenders have no valid license or authority required by law to enable them to lawfully
engage in the recruitment and placement of workers; and (2) the offenders undertake
either any activity within the meaning of recruitment and placement defined under Article
13(b) or any prohibited practices enumerated under Article 34.[11]
Under Article 13(b), recruitment and placement refers to any act of canvassing,
enlisting, contracting, transporting, utilizing, hiring or procuring workers[;] and includes
referrals, contract services, promising or advertising for employment, locally or abroad,
whether for profit or not. In the simplest terms, illegal recruitment is committed when a
person, who is not authorized by the government, gives the impression that he or she has
the power to send workers abroad.[12]
It is clear from the testimonies of the prosecution witnesses that appellant recruited
them. On direct examination, Arnel Damian testified thus:
Q When was that when Reynaldo Abondo introduced you to the accused?
A Last week of November. I cannot remember the exact date.
Q Where were you when you were introduced to the accused?
A At 25 V. West Santiago St., San Francisco del Monte, Quezon City, in the house of
Mrs. Alvarez.
xxxxxxxxx
Q When you arrived at that place, whom did you see?
A Mrs. Alvarez.
Q What happened during your first meeting.
A We were recruited by her.
Q What did she tell you?
A That if we could come up with the amount of P25,000.00 but she was only asking
for P12,500.00 as processing fee.
Q What else did she tell you?
A That we were to act as replacement of three persons who backed out.
Q Did she tell you where were you going?
A We were told to go to Taiwan as factory worker.
Q Did she tell you how much salary will you receive?
A $600.00.[13]
Appellant had also recruited for a similar job in Taiwan, Joel Serna who testified as
follows:
Q Will you please inform the Hon. Court why do you know Carmelita Alvarez?
A I came to know her when her daughter became the girlfriend of my friend and I was
told that she is recruiting workers for Taiwan.
Q After knowing that she was recruiting workers for Taiwan, what did you do, if any?
A I inquired from her and I was assured that the employment was not fake and I was
told to pay a processing fee.
Q When you said kanya or her to whom are you referring to?
A Carmelita Alvarez.
Q Do you still remember when was that?
A February 8, 1994.
Q Where did you meet?
A In her house at No. 25-B West Santiago St., SFDM, Quezon City.
Q What other things did she told you, if there was any?
A I would subject myself to a medical examination and after this, I would give her a
processing fee.
Q What was the purpose of that processing fee?
A So I could leave immediately for Taiwan.
Q Why are you going to Taiwan?
A I need a job.
Q If you give Mrs. Alvarez the processing fee, she will help you to go to Taiwan?
A Yes, sir.[14]
Antonio Damian, brother of Arnel, also testified to the same effect.
ATTY. DIGNADICE:
Q Will you please tell this Hon. Court the circumstances why you came to know
Carmelita Alvarez?
A I met Carmelita Alvarez on January 4, 1994.
COURT: (to the witness)
Under what circumstances did you happen to know her?
A I went to her house.
ATTY. DIGNADICE:
Q Why did you go to her house?
A Because I applied to her for work abroad.
Q Why did you apply for work abroad to her?
A Because of a brother who applied to her but failed the medical examination.
xxxxxxxxx
Q Arnel Damian applied for work abroad with Carmelita Alvarez?
A Yes, sir.
Q Was he able to leave for abroad?
A No, sir.
Q Why?
A Because he failed the medical examination.
xxxxxxxxx
Q What happened next after that?
 A Because my brother failed with the medical examination, Carmelita Alvarez cannot
return the processing fee in the amount of P12,000.00 so she told my brother to
look for another applicant.
ATTY. DIGNADICE:
Q Did your brother look for another applicant as his replacement?
A He asked me to take my place to save the P12,000.00.[15]
Roberto Alejandro testified that appellant had also told him she could send him to
Taiwan to work.
Q When you reached that place whom did you see there?
A Mrs. Alvarez.
Q And what happened during that first meeting?
A She told me that she has the capacity of sending to Taiwan. [16]
More telling is Ruben Riolas testimony on appellants specific acts constituting illegal
recruitment.
Q Can you tell the Hon. Court what transpired with that first meeting of yours with
Carmelita Alvarez at Capiz District?
A When I got there, I was with two companions, because we were replacements of
the three others who backed out. We were asked by the mother if we were the
friends of her daughter and son-in-law who is from the church?
Q What was your answer?
A I said yes.
Q Was there anything that transpired during that meeting?
A We were asked by her if we were interested to work as Factory workers in Taiwan.
Q What was your answer, if any?
A We said we are interested if it is true.
Q After knowing that you are interested to work as factory worker in Taiwan, what did
Carmelita Alvarez do if there was any?
A We were shown a document stating that such person was receiving $600.00
salary.
xxxxxxxxx
Q After knowing that you will be receiving the same amount if you work as factory
worker in Taiwan, what did you do, if any?
A We were told to immediately pay the processing fee.
Q Who told you to pay the processing fee?
A Mrs. Carmelita Alvarez.
Q This processing fee is for what?
A So that she could process the papers with the POEA, for the facilitation with the
POEA[,] so that we could be included in the first batch.[17]
Q What happened on that date after paying the tax of P1,500.00.
A We were promised to leave on February 23, 1993.
Q Will you please elaborate more on the promise, what kind of promise was it, if you
could remember?
A That would be the latest date that we could leave for Taiwan.
Q Would you somehow remember the words of Carmelita Alvarez?
xxxxxxxxx
 A Na papaalisin niya kami.
xxxxxxxxx
Q Why did you celebrate a dispededa?
A Because we were about to leave.
Q Who told you?
A Carmelita Alvarez.
xxxxxxxxx
Q Why were you celebrating this party?
A Because we will be leaving the following day.[18]
Furthermore, appellant committed other acts showing that she was engaged in illegal
recruitment. Enumerated in People v. Manungas Jr.[19] as acts constituting recruitment
within the meaning of the law were collecting pictures, birth certificates, NBI clearances
and other necessary documents for the processing of employment applications in Saudi
Arabia; and collecting payments for passport, training fees, placement fees, medical tests
and other sundry expenses.[20]
In this case, the prosecution proved that appellant had received varying amounts of
money from complainants for the processing of their employment applications for
Taiwan. Arnel Damian paid to appellant P12,500 for the processing fee,[21] P2,500 for the
medical fee and P1,500 for his passport.[22] Serna paid P12,000 for the processing
fee,[23] P3,000 for his birth certificate and passport,[24] P75 for a Departure and Orientation
Seminar,[25] P900 for the insurance fee and $50 for his visa.[26] Antonio Damian
paid P2,500 for the medical fee,[27] P900 for the insurance, P75 for the Pre-Departure and
Orientation Seminar (PDOS) fee, $50 for the processing fee and P3,500 for his birth
certificate.[28] Roberto Alejandro paid P40,000 for the processing fee[29] and P5,000 for
the insurance.[30] Riola paid P1,900 for his passport, P12,500 for the processing
fee, P900 for the insurance fee, P75 for the PDOS fee, P1,500 for the insurance and $50
for travel tax.[31]
The trial court found complainants to be credible and convincing witnesses. We are
inclined to give their testimonies due consideration. The best arbiter of the issue of the
credibility of the witnesses and their testimonies is the trial court. When the inquiry is on
that issue, appellate courts will generally not disturb the findings of the trial court,
considering that the latter was in a better position to decide the question, having heard
the witnesses themselves and observed their deportment and manner of testifying during
the trial. Its finding thereon will not be disturbed, unless it plainly overlooked certain facts
of substance and value which, if considered, may affect the result of the case.[32] We find
no cogent reason to overrule the trial court in this case.
No License
Appellant denies that she engaged in acts of recruitment and placement without first
complying with the guidelines issued by the Department of Labor and Employment. She
contends that she did not possess any license for recruitment, because she never
engaged in such activity.
We are not persuaded. In weighing contradictory declarations and statements,
greater weight must be given to the positive testimonies of the prosecution witnesses than
to the denial of the defendant.[33] Article 38(a) clearly shows that illegal recruitment is an
offense that is essentially committed by a non-licensee or non-holder of authority. A non-
licensee means any person, corporation or entity to which the labor secretary has not
issued a valid license or authority to engage in recruitment and placement; or whose
license or authority has been suspended, revoked or cancelled by the POEA or the labor
secretary.[34] A license authorizes a person or an entity to operate a private employment
agency, while authority is given to those engaged in recruitment and placement
activities.[35]
Likewise constituting illegal recruitment and placement activities are agents or
representatives whose appointments by a licensee or holder of authority have not been
previously authorized by the POEA.[36]
 That appellant in this case had been neither licensed nor authorized to recruit workers
for overseas employment was certified by Veneranda C. Guerrero, officer-in-charge of
the Licensing and Regulation Office; and Ma. Salome S. Mendoza, manager of the
Licensing Branch -- both of the Philippine Overseas Employment Administration.[37] Yet,
as complainants convincingly proved, she recruited them for jobs in Taiwan.
Absence of Receipts
Appellant contends that the RTC erred when it did not appreciate in her favor the
failure of Complainants Serna and Antonio Damian to present, as proofs that she had
illegally recruited them, receipts that she had allegedly issued to them.
We disagree. The Court has already ruled that the absence of receipts in a case for
illegal recruitment is not fatal, as long as the prosecution is able to establish through
credible testimonial evidence that accused-appellant has engaged in illegal
recruitment.[38] Such case is made, not by the issuance or the signing of receipts for
placement fees, but by engagement in recruitment activities without the necessary license
or authority.[39]
In People v. Pabalan,[40] the Court held that the absence of receipts for some of the
amounts delivered to the accused did not mean that the appellant did not accept or
receive such payments. Neither in the Statute of Frauds nor in the rules of evidence is
the presentation of receipts required in order to prove the existence of a recruitment
agreement and the procurement of fees in illegal recruitment cases. Such proof may
come from the testimonies of witnesses.[41]
Besides, the receipts issued by petitioner to Arnel Damian and Roberto Alejandro
already suffice to prove her guilt.[42]
Illegal Recruitment in Large Scale
Since only two complainants were able to show receipts issued by appellant,
petitioner claims that the prosecution failed to prove illegal recruitment in large scale.
We disagree. The finding of illegal recruitment in large scale is justified wherever the
elements previously mentioned concur with this additional element: the offender commits
the crime against three (3) or more persons, individually or as a group. [43] Appellant
recruited at least three persons. All the witnesses for the prosecution categorically
testified that it was she who had promised them that she could arrange for and facilitate
their employment in Taiwan as factory workers.
As for the defense that appellant had only referred complainants to Director Wong,
her public apology and retraction[44] belied her denials. After examining the transcripts,
we concur with the RTC that her averment that she was being prosecuted for her refusal
to give grease money to Major Umbao in exchange for her freedom does not disprove the
fact that she was caught in flagrante delicto in an entrapment operation.
We find appellants conviction for the crime charged sufficiently supported by
evidence; therefore, it should be sustained.
WHEREFORE, the appeal is DENIED and the assailed Decision AFFIRMED. Costs
against appellant.
SO ORDERED.
Puno, (Chairman), and Carpio, JJ., concur.
Sandoval-Gutierrez, J., on leave.
CASE#14

Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. 81510 March 14, 1990

HORTENCIA SALAZAR, petitioner,

vs.
HON. TOMAS D. ACHACOSO, in his capacity as Administrator of the Philippine
Overseas Employment Administration, and FERDIE MARQUEZ, respondents.

Gutierrez & Alo Law Offices for petitioner.

SARMIENTO, J.:

This concerns the validity of the power of the Secretary of Labor to issue warrants of
arrest and seizure under Article 38 of the Labor Code, prohibiting illegal recruitment.

The facts are as follows:

xxx xxx xxx

1. On October 21, 1987, Rosalie Tesoro of 177 Tupaz Street, Leveriza,

Pasay City, in a sworn statement filed with the Philippine Overseas
Employment Administration (POEA for brevity) charged petitioner
Hortencia Salazar, viz:

04. T: Ano ba ang dahilan at ikaw ngayon ay

narito at
nagbibigay ng salaysay.

S: Upang ireklamo sa dahilan ang aking PECC Card ay

ayaw ibigay sa akin ng dati kong manager. — Horty
Salazar — 615 R.O. Santos, Mandaluyong, Mla.

05. T: Kailan at saan naganap and ginawang

panloloko sa
iyo ng tao/mga taong inireklamo mo?

S. Sa bahay ni Horty Salazar.

06. T: Paano naman naganap ang pangyayari?

S. Pagkagaling ko sa Japan ipinatawag niya

ako. Kinuha
ang PECC Card ko at sinabing hahanapan ako
ng
booking sa Japan. Mag 9 month's na ako sa
Phils. ay
hindi pa niya ako napa-alis. So lumipat ako ng
ibang
company pero ayaw niyang ibigay and PECC
Card
ko.
2. On November 3, 1987, public respondent Atty. Ferdinand Marquez to
whom said complaint was assigned, sent to the petitioner the following
telegram:

YOU ARE HEREBY DIRECTED TO APPEAR BEFORE

FERDIE MARQUEZ POEA ANTI ILLEGAL RECRUITMENT
UNIT 6TH FLR. POEA BLDG. EDSA COR. ORTIGAS AVE.
MANDALUYONG MM ON NOVEMBER 6, 1987 AT 10 AM
RE CASE FILED AGAINST YOU. FAIL NOT UNDER
PENALTY OF LAW.

4. On the same day, having ascertained that the petitioner had no license
to operate a recruitment agency, public respondent Administrator Tomas
D. Achacoso issued his challenged CLOSURE AND SEIZURE ORDER
NO. 1205 which reads:

HORTY SALAZAR
No. 615 R.O. Santos St.
Mandaluyong, Metro Manila

Pursuant to the powers vested in me under Presidential Decree No. 1920

and Executive Order No. 1022, I hereby order the CLOSURE of your
recruitment agency being operated at No. 615 R.O. Santos St.,
Mandaluyong, Metro Manila and the seizure of the documents and
paraphernalia being used or intended to be used as the means of
committing illegal recruitment, it having verified that you have —

(1) No valid license or authority from the Department of

Labor and Employment to recruit and deploy workers for
overseas employment;

(2) Committed/are committing acts prohibited under Article

34 of the New Labor Code in relation to Article 38 of the
same code.

This ORDER is without prejudice to your criminal

prosecution under existing laws.

Done in the City of Manila, this 3th day of November, 1987.

5. On January 26, 1988 POEA Director on Licensing and Regulation Atty.

Estelita B. Espiritu issued an office order designating respondents Atty.
Marquez, Atty. Jovencio Abara and Atty. Ernesto Vistro as members of a
team tasked to implement Closure and Seizure Order No. 1205. Doing so,
the group assisted by Mandaluyong policemen and mediamen Lito Castillo
of the People's Journal and Ernie Baluyot of News Today proceeded to
the residence of the petitioner at 615 R.O. Santos St., Mandaluyong,
Metro Manila. There it was found that petitioner was operating Hannalie
Dance Studio. Before entering the place, the team served said Closure
and Seizure order on a certain Mrs. Flora Salazar who voluntarily allowed
them entry into the premises. Mrs. Flora Salazar informed the team that
Hannalie Dance Studio was accredited with Moreman Development
(Phil.). However, when required to show credentials, she was unable to
produce any. Inside the studio, the team chanced upon twelve talent
performers — practicing a dance number and saw about twenty more
waiting outside, The team confiscated assorted costumes which were duly
receipted for by Mrs. Asuncion Maguelan and witnessed by Mrs. Flora
Salazar.

6. On January 28, 1988, petitioner filed with POEA the following letter:

Gentlemen:
 On behalf of Ms. Horty Salazar of 615 R.O. Santos, Mandaluyong, Metro
Manila, we respectfully request that the personal properties seized at her
residence last January 26, 1988 be immediately returned on the ground
that said seizure was contrary to law and against the will of the owner
thereof. Among our reasons are the following:

1. Our client has not been given any prior notice or hearing,
hence the Closure and Seizure Order No. 1205 dated
November 3, 1987 violates "due process of law" guaranteed
under Sec. 1, Art. III, of the Philippine Constitution.

2. Your acts also violate Sec. 2, Art. III of the Philippine

Constitution which guarantees right of the people "to be
secure in their persons, houses, papers, and effects against
unreasonable searches and seizures of whatever nature and
for any purpose."

3. The premises invaded by your Mr. Ferdi Marquez and five

(5) others (including 2 policemen) are the private residence
of the Salazar family, and the entry, search as well as the
seizure of the personal properties belonging to our client
were without her consent and were done with unreasonable
force and intimidation, together with grave abuse of the color
of authority, and constitute robbery and violation of domicile
under Arts. 293 and 128 of the Revised Penal Code.

Unless said personal properties worth around TEN

THOUSAND PESOS (P10,000.00) in all (and which were
already due for shipment to Japan) are returned within
twenty-four (24) hours from your receipt hereof, we shall feel
free to take all legal action, civil and criminal, to protect our
client's interests.

We trust that you will give due attention to these important

matters.

7. On February 2, 1988, before POEA could answer the letter, petitioner

filed the instant petition; on even date, POEA filed a criminal complaint
against her with the Pasig Provincial Fiscal, docketed as IS-88-836. 1

On February 2, 1988, the petitioner filed this suit for prohibition. Although the acts
sought to be barred are already fait accompli, thereby making prohibition too late, we
consider the petition as one for certiorari in view of the grave public interest involved.

The Court finds that a lone issue confronts it: May the Philippine Overseas Employment
Administration (or the Secretary of Labor) validly issue warrants of search and seizure
(or arrest) under Article 38 of the Labor Code? It is also an issue squarely raised by the
petitioner for the Court's resolution.

Under the new Constitution, which states:

. . . no search warrant or warrant of arrest shall issue except upon

probable cause to be determined personally by the judge after
examination under oath or affirmation of the complainant and the
witnesses he may produce, and particularly describing the place to be
searched and the persons or things to be seized. 2

it is only a judge who may issue warrants of search and arrest. 3 In one case, it was
declared that mayors may not exercise this power:

xxx xxx xxx

 But it must be emphasized here and now that what has just been
described is the state of the law as it was in September, 1985. The law
has since been altered. No longer does the mayor have at this time the
power to conduct preliminary investigations, much less issue orders of
arrest. Section 143 of the Local Government Code, conferring this power
on the mayor has been abrogated, rendered functus officio by the 1987
Constitution which took effect on February 2, 1987, the date of its
ratification by the Filipino people. Section 2, Article III of the 1987
Constitution pertinently provides that "no search warrant or warrant of
arrest shall issue except upon probable cause to be determined personally
by the judge after examination under oath or affirmation of the
complainant and the witnesses he may produce, and particularly
describing the place to be searched and the person or things to be
seized." The constitutional proscription has thereby been manifested that
thenceforth, the function of determining probable cause and issuing, on
the basis thereof, warrants of arrest or search warrants, may be validly
exercised only by judges, this being evidenced by the elimination in the
present Constitution of the phrase, "such other responsible officer as may
be authorized by law" found in the counterpart provision of said 1973
Constitution, who, aside from judges, might conduct preliminary
investigations and issue warrants of arrest or search warrants. 4

Neither may it be done by a mere prosecuting body:

We agree that the Presidential Anti-Dollar Salting Task Force exercises, or

was meant to exercise, prosecutorial powers, and on that ground, it
cannot be said to be a neutral and detached "judge" to determine the
existence of probable cause for purposes of arrest or search. Unlike a
magistrate, a prosecutor is naturally interested in the success of his case.
Although his office "is to see that justice is done and not necessarily to
secure the conviction of the person accused," he stands, invariably, as the
accused's adversary and his accuser. To permit him to issue search
warrants and indeed, warrants of arrest, is to make him both judge and
jury in his own right, when he is neither. That makes, to our mind and to
that extent, Presidential Decree No. 1936 as amended by Presidential
Decree No. 2002, unconstitutional. 5

Section 38, paragraph (c), of the Labor Code, as now written, was entered as an
amendment by Presidential Decrees Nos. 1920 and 2018 of the late President
Ferdinand Marcos, to Presidential Decree No. 1693, in the exercise of his legislative
powers under Amendment No. 6 of the 1973 Constitution. Under the latter, the then
Minister of Labor merely exercised recommendatory powers:

(c) The Minister of Labor or his duly authorized representative shall have
the power to recommend the arrest and detention of any person engaged
in illegal recruitment. 6

On May 1, 1984, Mr. Marcos promulgated Presidential Decree No. 1920, with the
avowed purpose of giving more teeth to the campaign against illegal recruitment. The
Decree gave the Minister of Labor arrest and closure powers:

(b) The Minister of Labor and Employment shall have the power to cause
the arrest and detention of such non-licensee or non-holder of authority if
after proper investigation it is determined that his activities constitute a
danger to national security and public order or will lead to further
exploitation of job-seekers. The Minister shall order the closure of
companies, establishment and entities found to be engaged in the
recruitment of workers for overseas employment, without having been
licensed or authorized to do so. 7

On January 26, 1986, he, Mr. Marcos, promulgated Presidential Decree No. 2018,
giving the Labor Minister search and seizure powers as well:
 (c) The Minister of Labor and Employment or his duly authorized
representatives shall have the power to cause the arrest and detention of
such non-licensee or non-holder of authority if after investigation it is
determined that his activities constitute a danger to national security and
public order or will lead to further exploitation of job-seekers. The Minister
shall order the search of the office or premises and seizure of documents,
paraphernalia, properties and other implements used in illegal recruitment
activities and the closure of companies, establishment and entities found
to be engaged in the recruitment of workers for overseas employment,
without having been licensed or authorized to do so. 8

The above has now been etched as Article 38, paragraph (c) of the Labor Code.

The decrees in question, it is well to note, stand as the dying vestiges of authoritarian
rule in its twilight moments.

We reiterate that the Secretary of Labor, not being a judge, may no longer issue search
or arrest warrants. Hence, the authorities must go through the judicial process. To that
extent, we declare Article 38, paragraph (c), of the Labor Code, unconstitutional and of
no force and effect.

The Solicitor General's reliance on the case of Morano v. Vivo 9 is not well-
taken. Vivo involved a deportation case, governed by Section 69 of the defunct Revised
Administrative Code and by Section 37 of the Immigration Law. We have ruled that in
deportation cases, an arrest (of an undesirable alien) ordered by the President or his
duly authorized representatives, in order to carry out a final decision of deportation is
valid. 10 It is valid, however, because of the recognized supremacy of the Executive in
matters involving foreign affairs. We have held: 11

xxx xxx xxx

The State has the inherent power to deport undesirable aliens (Chuoco
Tiaco vs. Forbes, 228 U.S. 549, 57 L. Ed. 960, 40 Phil. 1122, 1125). That
power may be exercised by the Chief Executive "when he deems such
action necessary for the peace and domestic tranquility of the nation."
Justice Johnson's opinion is that when the Chief Executive finds that there
are aliens whose continued presence in the country is injurious to the
public interest, "he may, even in the absence of express law, deport
them". (Forbes vs. Chuoco Tiaco and Crossfield, 16 Phil. 534, 568, 569; In
re McCulloch Dick, 38 Phil. 41).

The right of a country to expel or deport aliens because their continued

presence is detrimental to public welfare is absolute and unqualified (Tiu
Chun Hai and Go Tam vs. Commissioner of Immigration and the Director
of NBI, 104 Phil. 949, 956). 12

The power of the President to order the arrest of aliens for deportation is, obviously,
exceptional. It (the power to order arrests) can not be made to extend to other cases,
like the one at bar. Under the Constitution, it is the sole domain of the courts.

Moreover, the search and seizure order in question, assuming, ex gratia argumenti, that
it was validly issued, is clearly in the nature of a general warrant:

Pursuant to the powers vested in me under Presidential Decree No. 1920

and Executive Order No. 1022, I hereby order the CLOSURE of your
recruitment agency being operated at No. 615 R.O. Santos St.,
Mandaluyong, Metro Manila and the seizure of the documents and
paraphernalia being used or intended to be used as the means of
committing illegal recruitment, it having verified that you have —
 (1) No valid license or authority from the Department of
Labor and Employment to recruit and deploy workers for
overseas employment;

(2) Committed/are committing acts prohibited under Article

34 of the New Labor Code in relation to Article 38 of the
same code.

This ORDER is without prejudice to your criminal prosecution under

existing laws. 13

We have held that a warrant must identify clearly the things to be seized, otherwise, it is
null and void, thus:

xxx xxx xxx

Another factor which makes the search warrants under consideration

constitutionally objectionable is that they are in the nature of general
warrants. The search warrants describe the articles sought to be seized in
this wise:

1) All printing equipment, paraphernalia, paper, ink, photo

equipment, typewriters, cabinets, tables, communications/
recording equipment, tape recorders, dictaphone and the like
used and/or connected in the printing of the "WE FORUM"
newspaper and any and all documents/communications,
letters and facsimile of prints related to the "WE FORUM"
newspaper.

2) Subversive documents, pamphlets, leaflets, books, and

other publications to promote the objectives and purposes of
the subversive organizations known as Movement for Free
Philippines, Light-a-Fire Movement and April 6 Movement;
and

3) Motor vehicles used in the distribution/circulation of the

"WE FORUM" and other subversive materials and
propaganda, more particularly,

1) Toyota-Corolla, colored yellow with Plate No. NKA 892;

2) DATSUN, pick-up colored white with Plate No. NKV 969;

3) A delivery truck with Plate No. NBS 542;

4) TOYOTA-TAMARAW, colored white with Plate No. PBP

665; and

5) TOYOTA Hi-Lux, pick-up truck with Plate No. NGV 472

with marking "Bagong Silang."

In Stanford v. State of Texas, the search warrant which authorized the

search for "books, records, pamphlets, cards, receipts, lists, memoranda,
pictures, recordings and other written instruments concerning the
Communist Parties of Texas, and the operations of the Community Party
in Texas," was declared void by the U.S. Supreme Court for being too
general. In like manner, directions to "seize any evidence in connection
with the violation of SDC 13-3703 or otherwise" have been held too
general, and that portion of a search warrant which authorized the seizure
of any "paraphernalia which could be used to violate Sec. 54-197 of the
Connecticut General Statutes (the statute dealing with the crime of
conspiracy)" was held to be a general warrant, and therefore invalid. The
 description of the articles sought to be seized under the search warrants in
question cannot be characterized differently.

In the Stanford case, the U.S. Supreme court calls to mind a notable
chapter in English history; the era of disaccord between the Tudor
Government and the English Press, when "Officers of the Crown were
given roving commissions to search where they pleased in order to
suppress and destroy the literature of dissent both Catholic and Puritan."
Reference herein to such historical episode would not be relevant for it is
not the policy of our government to suppress any newspaper or
publication that speaks with "the voice of non-conformity" but poses no
clear and imminent danger to state security. 14

For the guidance of the bench and the bar, we reaffirm the following principles:

1. Under Article III, Section 2, of the l987 Constitution, it is only judges,

and no other, who may issue warrants of arrest and search:

2. The exception is in cases of deportation of illegal and undesirable

aliens, whom the President or the Commissioner of Immigration may order
arrested, following a final order of deportation, for the purpose of
deportation.

WHEREFORE, the petition is GRANTED. Article 38, paragraph (c) of the Labor Code is
declared UNCONSTITUTIONAL and null and void. The respondents are ORDERED to
return all materials seized as a result of the implementation of Search and Seizure
Order No. 1205.

No costs.

SO ORDERED.

Fernan, C.J., Narvasa, Melencio-Herrera, Gutierrez, Jr., Cruz, Paras, Feliciano,

Gancayco, Padilla, Bidin, Cortes, Griño-Aquino, Medialdea and Regalado, JJ., concur.
CASE#15

Republic of the Philippines

SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 100641 June 14, 1993

FARLE P. ALMODIEL, petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION (FIRST DIVISION), RAYTHEON
PHILS., INC., respondents.

Apolinario Lomabao, Jr. for petitioner.

Vicente A. Cruz, Jr., for private respondent.

NOCON, J.:

Subject of this petition for certiorari is the decision dated March 21, 1991 of the National
Labor Relations Commission in NLRC Case No.
00-00645-89 which reversed and set aside the Labor Arbiter's decision dated
September 27, 1989 and ordered instead the payment of separation pay and financial
assistance of P100,000.00. Petitioner imputes grave abuse of discretion on the part of
the Commission and prays for the reinstatement of the Labor Arbiter's decision which
declared his termination on the ground of redundancy illegal.

Petitioner Farle P. Almodiel is a certified public accountant who was hired in October,
1987 as Cost Accounting Manager of respondent Raytheon Philippines, Inc. through a
reputable placement firm, John Clements Consultants, Inc. with a starting monthly
salary of P18,000.00. Before said employment, he was the accounts executive of
Integrated Microelectronics, Inc. for several years. He left his lucrative job therein in
view of the promising career offered by Raytheon. He started as a probationary or
temporary employee. As Cost Accounting Manager, his major duties were: (1) plan,
coordinate and carry out year and physical inventory; (2) formulate and issue out hard
copies of Standard Product costing and other cost/pricing analysis if needed and
required and (3) set up the written Cost Accounting System for the whole company.
After a few months, he was given a regularization increase of P1,600.00 a month. Not
long thereafter, his salary was increased to P21,600.00 a month.

On August 17, 1988, he recommended and submitted a Cost Accounting/Finance

Reorganization, affecting the whole finance group but the same was disapproved by the
Controller. However, he was assured by the Controller that should his position or
department which was apparently a one-man department with no staff becomes
untenable or unable to deliver the needed service due to manpower constraint, he
would be given a three (3) year advance notice.

In the meantime, the standard cost accounting system was installed and used at the
Raytheon plants and subsidiaries worldwide. It was likewise adopted and installed in the
Philippine operations. As a consequence, the services of a Cost Accounting Manager
allegedly entailed only the submission of periodic reports that would use computerized
forms prescribed and designed by the international head office of the Raytheon
Company in California, USA.
On January 27, 1989, petitioner was summoned by his immediate boss and in the
presence of IRD Manager, Mr. Rolando Estrada, he was told of the abolition of his
position on the ground of redundancy. He pleaded with management to defer its action
or transfer him to another department, but he was told that the decision of management
was final and that the same has been conveyed to the Department of Labor and
Employment. Thus, he was constrained to file the complaint for illegal dismissal before
the Arbitration Branch of the National Capital Region, NLRC, Department of Labor and
Employment.

On September 27, 1989, Labor Arbiter Daisy Cauton-Barcelona rendered a decision,

the dispositive portion of which reads as follows:

WHEREFORE, judgment is hereby rendered declaring that complainant's

termination on the ground of redundancy is highly irregular and without
legal and factual basis, thus ordering the respondents to reinstate
complainant to his former position with full backwages without lost of
seniority rights and other benefits. Respondents are further ordered to pay
complainant P200,000.00 as moral damages and P20,000.00 as
exemplary damages, plus ten percent (10%) of the total award as
attorney's fees.1

Raytheon appealed therefrom on the grounds that the Labor Arbiter committed grave
abuse of discretion in denying its rights to dismiss petitioner on the ground of
redundancy, in relying on baseless surmises and self-serving assertions of the
petitioner that its act was tainted with malice and bad faith and in awarding moral and
exemplary damages and attorney's fees.

On March 21, 1991, the NLRC reversed the decision and directed Raytheon to pay
petitioner the total sum of P100,000.00 as separation pay/financial assistance. The
dispositive portion of which is hereby quoted as follows:

WHEREFORE, the appealed decision is hereby set aside. In its stead,

Order is hereby issued directing respondent to pay complainant the total
separation pay/financial assistance of One Hundred Thousand Pesos
(P100,000.00).

SO ORDERED. 2

From this decision, petitioner filed the instant petition averring that:

The public respondent committed grave abuse of discretion amounting to

(lack of) or in excess of jurisdiction in declaring as valid and justified the
termination of petitioner on the ground of redundancy in the face of clearly
established finding that petitioner's termination was tainted with malice,
bad faith and irregularity. 3

Termination of an employee's services because of redundancy is governed by Article

283 of the Labor Code which provides as follows:

Art. 283. Closure of establishment and reduction of personnel. — The

employer may also terminate the employment of any employee due to
installation of labor-saving devices, redundancy, retrenchment to prevent
losses or the closing or cessation of operation of the establishment or
undertaking unless the closing is for the purpose of circumventing the
provisions of this Title, by serving a written notice on the worker and the
Department of Labor and Employment at least one (1) month before the
intended date thereof. In case of termination due to installation of labor-
saving devices or redundancy, the worker affected thereby shall be
entitled to a separation pay equivalent to at least one (1) month pay for
every year of service, whichever is higher. In case of retrenchment to
prevent losses and in cases of closure or cessation of operations of
establishment or undertaking not due to serious business losses or
 financial reverses, the separation pay shall be equivalent to at least one
(1) month pay or at least one-half (1/2) month pay for every year of
service, whichever is higher. A fraction of at least six (6) months shall be
considered as one (1) whole year.

There is no dispute that petitioner was duly advised, one (1) month before, of the
termination of his employment on the ground of redundancy in a written notice by his
immediate superior, Mrs. Magdalena B.D. Lopez sometime in the afternoon of January
27, 1989. He was issued a check for P54,863.00 representing separation pay but in
view of his refusal to acknowledge the notice and the check, they were sent to him thru
registered mail on January 30, 1989. The Department of Labor and Employment was
served a copy of the notice of termination of petitioner in accordance with the pertinent
provisions of the Labor Code and the implementing rules.

The crux of the controversy lies on whether bad faith, malice and irregularity crept in the
abolition of petitioner's position of Cost Accounting Manager on the ground of
redundancy. Petitioner claims that the functions of his position were absorbed by the
Payroll/Mis/Finance Department under the management of Danny Ang Tan Chai, a
resident alien without any working permit from the Department of Labor and
Employment as required by law. Petitioner relies on the testimony of Raytheon's witness
to the effect that corollary functions appertaining to cost accounting were dispersed to
other units in the Finance Department. And granting that his department has to be
declared redundant, he claims that he should have been the Manager of the
Payroll/Mis/Finance Department which handled general accounting, payroll and
encoding. As a B. S. Accounting graduate, a CPA with M.B.A. units, 21 years of work
experience, and a natural born Filipino, he claims that he is better qualified than Ang
Tan Chai, a B.S. Industrial Engineer, hired merely as a Systems Analyst Programmer or
its equivalent in early 1987, promoted as MIS Manager only during the middle part of
1988 and a resident alien.

On the other hand, Raytheon insists that petitioner's functions as Cost Accounting
Manager had not been absorbed by Ang Tan Chai, a permanent resident born in this
country. It claims to have established below that Ang Tan Chai did not displace
petitioner or absorb his functions and duties as they were occupying entirely different
and distinct positions requiring different sets of expertise or qualifications and
discharging functions altogether different and foreign from that of petitioner's abolished
position. Raytheon debunks petitioner's reliance on the testimony of Mr. Estrada saying
that the same witness testified under oath that the functions of the Cost Accounting
Manager had been completely dispensed with and the position itself had been totally
abolished.

Whether petitioner's functions as Cost Accounting Manager have been dispensed with
or merely absorbed by another is however immaterial. Thus, notwithstanding the dearth
of evidence on the said question, a resolution of this case can be arrived at without
delving into this matter. For even conceding that the functions of petitioner's position
were merely transferred, no malice or bad faith can be imputed from said act. A survey
of existing case law will disclose that in Wiltshire File Co., Inc. v. NLRC, 4 the position of
Sales Manager was abolished on the ground of redundancy as the duties previously
discharged by the Sales Manager simply added to the duties of the General Manager to
whom the Sales Manager used to report. In adjudging said termination as legal, this
Court said that redundancy, for purposes of our Labor Code, exists where the services
of an employee are in excess of what is reasonably demanded by the actual
requirements of the enterprise. The characterization of an employee's services as no
longer necessary or sustainable, and therefore, properly terminable, was an exercise of
business judgment on the part of the employer. The wisdom or soundness of such
characterization or decision was not subject to discretionary review on the part of the
Labor Arbiter nor of the NLRC so long, of course, as violation of law or merely arbitrary
and malicious action is not shown.

In the case of International Macleod, Inc. v. Intermediate Appellate Court, 5 this Court
also considered the position of Government Relations Officer to have become
redundant in view of the appointment of the International Heavy Equipment Corporation
as the company's dealer with the government. It held therein that the determination of
the need for the phasing out of a department as a labor and cost saving device because
it was no longer economical to retain said services is a management prerogative and
the courts will not interfere with the exercise thereof as long as no abuse of discretion or
merely arbitrary or malicious action on the part of management is shown.

In the same vein, this Court ruled in Bondoc v. People's Bank and Trust Co., 6 that the
bank's board of directors possessed the power to remove a department manager whose
position depended on the retention of the trust and confidence of management and
whether there was need for his services. Although some vindictive motivation might
have impelled the abolition of his position, this Court expounded that it is undeniable
that the bank's board of directors possessed the power to remove him and to determine
whether the interest of the bank justified the existence of his department.

Indeed, an employer has no legal obligation to keep more employees than are
necessary for the operation of its business. Petitioner does not dispute the fact that a
cost accounting system was installed and used at Raytheon subsidiaries and plants
worldwide; and that the functions of his position involve the submission of periodic
reports utilizing computerized forms designed and prescribed by the head office with the
installation of said accounting system. Petitioner attempts to controvert these realities
by alleging that some of the functions of his position were still indispensable and were
actually dispersed to another department. What these indispensable functions that were
dispersed, he failed however, to specify and point out. Besides, the fact that the
functions of a position were simply added to the duties of another does not affect the
legitimacy of the employer's right to abolish a position when done in the normal exercise
of its prerogative to adopt sound business practices in the management of its affairs.

Considering further that petitioner herein held a position which was definitely managerial
in character, Raytheon had a broad latitude of discretion in abolishing his position. An
employer has a much wider discretion in terminating employment relationship of
managerial personnel compared to rank and file employees. 7 The reason obviously is
that officers in such key positions perform not only functions which by nature require the
employer's full trust and confidence but also functions that spell the success or failure of
an enterprise.

Likewise destitute of merit is petitioner's imputation of unlawful discrimination when

Raytheon caused corollary functions appertaining to cost accounting to be absorbed by
Danny Ang Tan Chai, a resident alien without a working permit. Article 40 of the Labor
Code which requires employment permit refers to non-resident aliens. The employment
permit is required for entry into the country for employment purposes and is issued after
determination of the non-availability of a person in the Philippines who is competent,
able and willing at the time of application to perform the services for which the alien is
desired. Since Ang Tan Chai is a resident alien, he does not fall within the ambit of the
provision.

Petitioner also assails Raytheon's choice of Ang Tan Chai to head the
Payroll/Mis/Finance Department, claiming that he is better qualified for the position. It
should be noted, however, that Ang Tan Chai was promoted to the position during the
middle part of 1988 or before the abolition of petitioner's position in early 1989. Besides
the fact that Ang Tan Chai's promotion thereto is a settled matter, it has been
consistently held that an objection founded on the ground that one has better
credentials over the appointee is frowned upon so long as the latter possesses the
minimum qualifications for the position. In the case at bar, since petitioner does not
allege that Ang Tan Chai does not qualify for the position, the Court cannot substitute its
discretion and judgment for that which is clearly and exclusively management
prerogative. To do so would take away from the employer what rightly belongs to him as
aptly explained in National Federation of Labor Unions v. NLRC: 8

It is a well-settled rule that labor laws do not authorize interference with

the employer's judgment in the conduct of his business. The determination
of the qualification and fitness of workers for hiring and firing, promotion or
reassignment are exclusive prerogatives of management. The Labor Code
 and its implementing Rules do not vest in the Labor Arbiters nor in the
different Divisions of the NLRC (nor in the courts) managerial authority.
The employer is free to determine, using his own discretion and business
judgment, all elements of employment, "from hiring to firing" except in
cases of unlawful discrimination or those which may be provided by law.
There is none in the instant case.

Finding no grave abuse of discretion on the part of the National Labor Relations
Commission in reversing and annulling the decision of the Labor Arbiter and that on the
contrary, the termination of petitioner's employment was anchored on a valid and
authorized cause under Article 283 of the Labor Code, the instant petition
for certiorari must fail.

SO ORDERED.

Narvasa, C.J., Padilla and Regalado, JJ., concur.

CASE#16

Republic of the Philippines

SUPREME COURT
Manila

THIRD DIVISION

G.R. No. 93666 April 22, 1991

GENERAL MILLING CORPORATION and EARL TIMOTHY CONE, petitioners,

vs.
HON. RUBEN D. TORRES, in his capacity as Secretary of Labor and Employment,
HON. BIENVENIDO E. LAGUESMA, in his capacity as Acting Secretary of Labor
and Employment, and BASKETBALL COACHES ASSOCIATION OF THE
PHILIPPINES, respondents.

Sobrevinas, Diaz, Hayudini & Bodegon Law Office for petitioners.

Rodrigo, Cuevas & De Borja for respondent BCAP.

RESOLUTION

FELICIANO, J.:

On 1 May 1989, the National Capital Region of the Department of Labor and
Employment issued Alien Employment Permit No. M-0689-3-535 in favor of petitioner
Earl Timothy Cone, a United States citizen, as sports consultant and assistant coach for
petitioner General Milling Corporation ("GMC").

On 27 December 1989, petitioners GMC and Cone entered into a contract of

employment whereby the latter undertook to coach GMC's basketball team.

On 15 January 1990, the Board of Special Inquiry of the Commission on Immigration

and Deportation approved petitioner Cone's application for a change of admission
status from temporary visitor to pre-arranged employee.

On 9 February 1990, petitioner GMC requested renewal of petitioner Cone's alien

employment permit. GMC also requested that it be allowed to employ Cone as full-
fledged coach. The DOLE Regional Director, Luna Piezas, granted the request on 15
February 1990.

On 18 February 1990, Alien Employment Permit No. M-02903-881, valid until 25

December 1990, was issued.

Private respondent Basketball Coaches Association of the Philippines ("BCAP")

appealed the issuance of said alien employment permit to the respondent Secretary of
Labor who, on 23 April 1990, issued a decision ordering cancellation of petitioner
Cone's employment permit on the ground that there was no showing that there is no
person in the Philippines who is competent, able and willing to perform the services
required nor that the hiring of petitioner Cone would redound to the national interest.

Petitioner GMC filed a Motion for Reconsideration and two (2) Supplemental Motions for
Reconsideration but said Motions were denied by Acting Secretary of Labor Bienvenido
E. Laguesma in an Order dated 8 June 1990.

Petitioners are now before the Court on a Petition for Certiorari, dated 14 June 1990,
alleging that:
 1. respondent Secretary of Labor gravely abused his discretion when he revoked
petitioner Cone's alien employment permit; and

2. Section 6 (c), Rule XIV, Book I of the Omnibus Rules Implementing the Labor
Code is null and void as it is in violation of the enabling law as the Labor Code
does not empower respondent Secretary to determine if the employment of an
alien would redound to national interest.

Deliberating on the present Petition for Certiorari, the Court considers that petitioners
have failed to show any grave abuse of discretion or any act without or in excess of
jurisdiction on the part of respondent Secretary of Labor in rendering his decision, dated
23 April 1990, revoking petitioner Cone's Alien Employment Permit.

The alleged failure to notify petitioners of the appeal filed by private respondent BCAP
was cured when petitioners were allowed to file their Motion for Reconsideration before
respondent Secretary of Labor.1

Petitioner GMC's claim that hiring of a foreign coach is an employer's prerogative has
no legal basis at all. Under Article 40 of the Labor Code, an employer seeking
employment of an alien must first obtain an employment permit from the Department of
Labor. Petitioner GMC's right to choose whom to employ is, of course, limited by the
statutory requirement of an alien employment permit.

Petitioners will not find solace in the equal protection clause of the Constitution. As
pointed out by the Solicitor-General, no comparison can be made between petitioner
Cone and Mr. Norman Black as the latter is "a long time resident of the country," and
thus, not subject to the provisions of Article 40 of the Labor Code which apply only to
"non-resident aliens." In any case, the term "non-resident alien" and its obverse
"resident alien," here must be given their technical connotation under our law on
immigration.

Neither can petitioners validly claim that implementation of respondent Secretary's

decision would amount to an impairment of the obligations of contracts. The provisions
of the Labor Code and its Implementing Rules and Regulations requiring alien
employment permits were in existence long before petitioners entered into their contract
of employment. It is firmly settled that provisions of applicable laws, especially
provisions relating to matters affected with public policy, are deemed written into
contracts.2 Private parties cannot constitutionally contract away the otherwise applicable
provisions of law.

Petitioners' contention that respondent Secretary of Labor should have deferred to the
findings of Commission on Immigration and Deportation as to the necessity of
employing petitioner Cone, is, again, bereft of legal basis. The Labor Code itself
specifically empowers respondent Secretary to make a determination as to the
availability of the services of a "person in the Philippines who is competent, able and
willing at the time of application to perform the services for which an alien is desired."3

In short, the Department of Labor is the agency vested with jurisdiction to determine the
question of availability of local workers. The constitutional validity of legal provisions
granting such jurisdiction and authority and requiring proof of non-availability of local
nationals able to carry out the duties of the position involved, cannot be seriously
questioned.

Petitioners apparently also question the validity of the Implementing Rules and
Regulations, specifically Section 6 (c), Rule XIV, Book I of the Implementing Rules, as
imposing a condition not found in the Labor Code itself. Section 6 (c), Rule XIV, Book I
of the Implementing Rules, provides as follows:

Section 6. Issuance of Employment Permit –– the Secretary of Labor may issue

an employment permit to the applicant based on:
 a) Compliance by the applicant and his employer with the requirements of
Section 2 hereof;

b) Report of the Bureau Director as to the availability or non-availability of any

person in the Philippines who is competent and willing to do the job for which the
services of the applicant are desired.

(c) His assessment as to whether or not the employment of the applicant will
redound to the national interest;

(d) Admissibility of the alien as certified by the Commission on Immigration and

Deportation;

(e) The recommendation of the Board of Investments or other appropriate

government agencies if the applicant will be employed in preferred areas of
investments or in accordance with the imperative of economic development;

xxx xxx xxx

(Emphasis supplied)

Article 40 of the Labor Code reads as follows:

Art. 40. Employment per unit of non-resident aliens. –– Any alien seeking
admission to the Philippines for employment purposes and any domestic or
foreign employer who desires to engage an alien for employment in the
Philippines shall obtain an employment permit from the Department of Labor.

The employment permit may be issued to a non-resident alien or to the applicant

employer after a determination of the non-availability of a person in the
Philippines who is competent, able and willing at the time of application to
perform the services for which the alien is desired.

For an enterprise registered in preferred areas of investments, said employment

permit may be issued upon recommendation of the government agency charged
with the supervision of said registered enterprise. (Emphasis supplied)

Petitioners apparently suggest that the Secretary of Labor is not authorized to take into
account the question of whether or not employment of an alien applicant would
"redound to the national interest" because Article 40 does not explicitly refer to such
assessment. This argument (which seems impliedly to concede that the relationship of
basketball coaching and the national interest is tenuous and unreal) is not persuasive.
In the first place, the second paragraph of Article 40 says: "[t]he employment
permit may be issued to a non-resident alien or to the applicant employer after a
determination of the non-availability of a person in the Philippines who is competent,
able and willing at the time of application to perform the services for which the alien is
desired." The permissive language employed in the Labor Code indicates that the
authority granted involves the exercise of discretion on the part of the issuing authority.
In the second place, Article 12 of the Labor Code sets forth a statement of objectives
that the Secretary of Labor should, and indeed must, take into account in exercising his
authority and jurisdiction granted by the Labor Code,

Art. 12. Statement of Objectives. –– It is the policy of the State:

a) To promote and maintain a state of full employment through improved

manpower training, allocation and utilization;

xxx xxx xxx

c) To facilitate a free choice of available employment by persons seeking work in

conformity with the national interest;
 d) To facilitate and regulate the movement of workers in conformity with the
national interest;

e) To regulate the employment of aliens, including the establishment of a

registration and/or work permit system;

xxx xxx xxx

Thus, we find petitioners' arguments on the above points of constitutional law too
insubstantial to require further consideration.1avvphi1

Petitioners have very recently manifested to this Court that public respondent Secretary
of Labor has reversed his earlier decision and has issued an Employment Permit to
petitioner Cone. Petitioners seek to withdraw their Petition for Certiorari on the ground
that it has become moot and academic.

While ordinarily this Court would dismiss a petition that clearly appears to have become
moot and academic, the circumstances of this case and the nature of the questions
raised by petitioners are such that we do not feel justified in leaving those questions
unanswered.4

Moreover, assuming that an alien employment permit has in fact been issued to
petitioner Cone, the basis of the reversal by the Secretary of Labor of his earlier
decision does not appear in the record. If such reversal is based on some view of
constitutional law or labor law different from those here set out, then such employment
permit, if one has been issued, would appear open to serious legal objections.

ACCORDINGLY, the Court Resolved to DISMISS the Petition for certiorari for lack of
merit. Costs against petitioners.

Fernan, C.J., Bidin and Davide, Jr., JJ., concur.

Gutierrez, Jr., J., in the result.