LABOR STANDARDS CASE DIGEST
PEOPLE VS. PASIA Upon complaint filed by Serrano before the Labor
142 SCRA 664 (1986)
FACTS:
Serapio Abug was charged with illegal
recruitment. His defense was that the informations
filed against him did not constitute an offense
because in each of the four informations filed against
him, each denote that he was only recruiting one
person whereas the statute requires two or more
persons. Abug then filed a motion to quash. Under the
proviso in Article 13(b), he claimed, there would be
illegal recruitment only "whenever two or more
persons are in any manner promised or offered any
employment for a fee."
The posture of the petitioner is that the private
respondent is being prosecuted under Article 39 in
relation to Article 16 of the Labor Code; hence, Article
13(b) is not applicable. However, as the first two cited
articles penalize acts of recruitment and placement
without proper authority, which is the charge
embodied in the informations, application of the
definition of recruitment and placement in Article
13(b) is unavoidable.
ISSUE: Whether or not the petitioner is guilty of
violating Article 13(b) of P. D. 442, otherwise known
as the Labor Code.
HELD:
The specification of two or more persons is
not to create a condition prior to filing but rather it
states a presumption that the individual is engaged in
recruitment in consideration of a fee, however the
number of persons is not an essential ingredient to
the act of recruitment or placement, and it will still
qualify even if only one person has been involved.
SERRANO VS. GALLANT MARITIME SERVICES, INC.
(MARCH 4, 2009)
FACTS:
Petitioner Antonio Serrano was hired by
respondents Gallant Maritime Services, Inc. and
Marlow Navigation Co., Inc., under a POEA-approved
contract of employment for 12 months, as Chief
Officer, with the basic monthly salary of US$1,400,
plus $700/month overtime pay, and 7 days paid
vacation leave per month.
On the date of his departure, Serrano was constrained
to accept a downgraded employment contract upon
the assurance and representation of respondents that
he would be Chief Officer by the end of April 1998.
Respondents did not deliver on their promise to make
Serrano Chief Officer. Hence, Serrano refused to stay
on as second Officer and was repatriated to the
Philippines, serving only two months and 7 days,
leaving an unexpired portion of nine months and
twenty-three days.
MARIA ANNY G. YANONG
Arbiter (LA), the dismissal was declared illegal. On
appeal, the NLRC modified the LA decision based on
the provision of RA 8042. Serrano filed a Motion for
Partial Reconsideration, but this time he questioned
the constitutionality of the last clause in the 5th
paragraph of Section 10 of RA 8042.
ISSUE: Whether or not 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.
HELD:
The answer is in the affirmative.
To Filipino workers, the rights guaranteed
under the foregoing constitutional provisions
translate to economic security and parity.
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-à-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-à-vis local workers with fixed-
period employment;
The subject clause singles out one classification of
OFWs and burdens it with a peculiar disadvantage.
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. 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.
MILLARES & LAGDA VS. NLRC (2002)
In this landmark case, the Supreme Court,
citing Brent case and Coyoca case, ruled that
seafarers are considered contractual employees.
They cannot be considered as regular employees
under Article 280 of the Labor Code. Their
employment is governed by the contracts they sign
everytime they are rehired and their employment is
terminated when the contract expires. Their
employment is contractually fixed for a certain
period of time.
FACTS:
Douglas Millares was employed by ESSO
International Shipping Company through its
local manning agency, Trans-Global Maritime Agency,
PAGE 1
 LABOR STANDARDS CASE DIGEST
as a machinist he was promoted as Chief Engineer
which position Millares applied for a leave of absence
for almost1mon.the Trans-Global, approved the
request for leave of absence. Millares wrote to the
Operations Manager of Exxon International Co
.informing him of his intention to avail of the optional
retirement plan under the Consecutive Enlistment
Incentive Plan (CEIP) considering that he had already
rendered more than twenty (20) years of continuous
service. Esso International, denied the request for
optional retirement on the following grounds, to wit:
(1) he was employed on a contractual basis; (2) his
contract of enlistment(COE) did not provide for
retirement before the age of sixty (60) years; and (3)
he did not comply with the requirement for claiming
benefits under the CEIP, i.e., to submit a written
advice to the company of his intention to terminate
his employment within thirty (30)days from his last
disembarkation date Millares requested for
an extension of his leave of absence for another
15 days. The Crewing Manager, Ship Group A, Trans-
Global, wrote petitioner Millares advising him
that respondent Esso International "has corrected the
deficiency in its manpower requirements specifically
in the Chief Engineer rank by promoting a First
Assistant Engineer to this position as a result of (his)
previous leave of absence which expired last August 8,
1989. The adjustment in said rank was required in
order to meet manpower schedules as a result of (his)
inability. Esso International advised Millares that his
absence without leave, which is equivalent
to abandonment of his position. On the other hand
Lagda was employed by Esso International as
wiper/oiler He was promoted as Chief Engineer in
1980, a position he continued to occupy until his last
COE expired on April 10, 1989.Lagda applied for a
leave of absence from June 19,1989 up to the whole
month of August 1989. Then the Trans-Global’s
approved petitioner Lagda’s leave of absence from
June 22, 1989 to July20, 1989[7] and advised him to
report for re-assignment on July 21, 1989. Lagda
wrote a letter to Operations Manager of Esso
International, through Trans-Global’s President
informing him of his intention to avail of the optional
early retirement plan in view of his twenty (20) years
continuous service in the company Trans-Global
denied petitioner Lagda’s request for availment of the
optional early retirement scheme on the
same grounds upon which petitioner Millares’ request
was denied. He requested for an extension of his
leave of absence up to August 26, 1989 and the same
was approved. However Esso International through
Personnel Administrator, advised petitioner Lagda
that in view of his "unavailability for contractual sea
service," he had been dropped from the roster of
crew members effective September 1, 1989.
Millares and Lagda filed a complaint-affidavit,
for illegal dismissal and non-payment of employee
benefits against private respondents Esso
International and Trans-Global, before the
POEA. POEA: dismissing the complaint for lack
MARIA ANNY G. YANONG
of merit. NLRC dismissing petitioners’ appeal and
denying their motion for new trial for lack of merit.
ISSUE: WHETHER OR NOT THEY ARE REGULAR
EMPLOYEES.
HELD:
Art. 280. Regular and casual employment. -
The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement
of the parties, an employment shall be deemed to be
regular where the employee has been engaged to
perform activities which are usually necessary or
desirable in the usual business or trade of the
employer, except where the employment has been
fixed for a specific project or undertaking the
completion or termination of which has been
determined at the time of the engagement of the
employee or where the work or services to be
performed is seasonal in nature and the employment
is for the duration of the season. An employment shall
be deemed to be casual if it is not covered by the
preceding paragraph. Provided, that, any employee
who has rendered at least one year of service,
whether such service is continuous or broken, shall be
considered a regular employee with respect to the
activity in which he is employed and his employment
shall continue while such activity exists. The primary
standard to determine a regular employment is the
reasonable connection between the particular activity
performed by the employee in relation to the
usual business or trade of the employer. The test is
whether the former is usually necessary or desirable
in the usual business or trade of the employer The
connection can be determined by considering the
nature of the work performed and its relation to the
scheme of the particular business or trade in its
entirety. Also, if the employee has been performing
the job for at least one year, even if the performance
is not continuous or merely intermittent, the law
deems the repeated and continuing need for
its performance as sufficient evidence of the necessity
if not indispensability of that activity to the business.
Hence, the employment is also considered regular,
but only with respect to such activity and while such
activity exists.[it is undisputed that petitioners were
employees of private respondents until their services
were terminated on September 1, 1989.They served
in their capacity as Chief Engineers, performing
activities which were necessary and desirable in the
business of private respondents Esso International,
a shipping company; and Trans-Global, its local
manning agency which supplies the manpower and
crew requirements of Esso International’s vessels. It
is, likewise, clear that petitioners had been in the
employ of private respondents for 20 years. The
records reveal that petitioners were repeatedly re-
hired by private respondents even after the expiration
of their respective eight- month contracts. Such
repeated re-hiring which continued for 20 years,
cannot but be appreciated as sufficient evidence of
the necessity and indispensability of petitioners’
service to the private respondents’ business or trade.
PAGE 2
 LABOR STANDARDS CASE DIGEST
Verily, as petitioners are by express provision of
Article 280 of the Labor Code, considered regular
employees. There was no valid cause for the
termination of petitioners. It will be recalled, that
petitioner Millares was dismissed for allegedly having
"abandoned" his post; and petitioner Lagda, for his
alleged "unavailability for contractual sea service.
However, that petitioners did not abandon their jobs
such as to justify the unlawful termination of their
employment is borne out by the records. To
constitute abandonment, two elements must concur:
(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.
Furthermore, the absence of petitioners was justified
by the fact that they secured the approval of
respondents to take a leave of absence after the
termination of their last contracts of enlistment.
Clearly, petitioners’ termination is illegal
VIR-JEN SHIPPING AND MARINE
SERVICES VS. NLRC (1983)
FACTS:
Certain seamen entered into a contract of
employment for a 12-month period. Some three
months after the commencement of their
employment, the seamen demanded a 50% increase
of their salaries and benefits.
The seamen demanded this increase while their vessel
was on route to a port in Australia controlled by
the International Transport Federation (ITP) where
the ITF could detain the vessels unless it paid its
season ITF rates. The agent of the owner of the vessel
agreed to a 25% increase, but when the vessel arrived
in Japan shortly afterwards, the seamen were
repatriated to Manila and their contract terminated.
Two motions for reconsideration filed with Second
Division were denied by said Division. Another motion
for reconsideration was filed with the Supreme Court
en banc which gave its due course, after finding that
there was a need to reconcile the decision of the
Second Division with that of the First Division with the
Wallen Decision. In that decision, the First Division
had ruled that the termination of the seamen was
illegal.
ISSUE: Whether or not the termination of the seamen
was illegal.
HELD:
The termination of the contract of the seamen
was illegal. A manning contract involves the interests
not only of the signatories thereto, such as the local
Filipino recruiting agent, the foreign owner of vessel
and the Filipino seamen in general as well as the
country itself. Conformably to the power vested in
the NSB, the law requires that all manning contracts
MARIA ANNY G. YANONG
shall be approved by said agency. The stringent rules
governing Filipino seamen abroad foreign ships are
dictated by national interest
EQUI-ASIA PLACEMENT, INC. VS.
DFA & DOLE (2016)
FACTS:
ISSUE:
HELD:
FINMAN GENERAL ASSURANCE CORPORATION vs.
COURT OF APPEALS (1992)
FACTS:
On October 22, 1986, deceased, Carlie
Surposa was insured with petitioner Finman General
Assurance Corporation with his parents, spouses Julia
and Carlos Surposa, and brothers Christopher,
Charles, Chester and Clifton, all surnamed, Surposa, as
beneficiaries. While said insurance policy was in full
force and effect, the insured, Carlie Surposa, died on
October 18, 1988 as a result of a stab wound inflicted
by one of the three (3) unidentified men. Private
respondent and the other beneficiaries of said
insurance policy filed a written notice of claim with
the petitioner insurance company which denied said
claim contending that murder and assault are not
within the scope of the coverage of the insurance
policy. Private respondent filed a complaint with the
Insurance Commission which rendered a favorable
response for the respondent. The appellate court
ruled likewise. Petitioner filed this petition alleging
grave abuse of discretion on the part of the appellate
court in applying the principle of "expresso unius
exclusio alterius" in a personal accident insurance
policy, since death resulting from murder and/or
assault are impliedly excluded in said insurance policy
considering that the cause of death of the insured was
not accidental but rather a deliberate and intentional
act of the assailant. Therefore, said death was
committed with deliberate intent which, by the very
nature of a personal accident insurance policy, cannot
be indemnified.
ISSUE: Whether or not the insurer is liable for the
payment of the insurance premiums
HELD:
Yes, the insurer is still liable. Contracts of
insurance are to be construed liberally in favor of the
insured and strictly against the insurer. Thus
ambiguity in the words of an insurance contract
should be interpreted in favor of its beneficiary. The
terms "accident" and "accidental" as used in
insurance contracts have not acquired any technical
meaning, and are construed by the courts in their
ordinary and common acceptation. Thus, the terms
have been taken to mean that which happen by
chance or fortuitously, without intention and design,
PAGE 3
 LABOR STANDARDS CASE DIGEST

and which is unexpected, unusual, and unforeseen.
Where the death or injury is not the natural or
probable result of the insured's voluntary act, or if
something unforeseen occurs in the doing of the act
which produces the injury, the resulting death is
within the protection of the policies insuring against
death or injury from accident. In the case at bar, it
cannot be pretended that Carlie Surposa died in the
course of an assault or murder as a result of his
voluntary act considering the very nature of these
crimes. Neither can it be said that where was a
capricious desire on the part of the accused to expose
his life to danger considering that he was just going
home after attending a festival. Furthermore, the
personal accident insurance policy involved herein
specifically enumerated only ten (10) circumstances
wherein no liability attaches to petitioner insurance
company for any injury, disability or loss suffered by
the insured as a result of any of the stimulated causes.
The principle of " expresso unius exclusio alterius" —
the mention of one thing implies the exclusion of
another thing — is therefore applicable in the instant
case since murder and assault, not having been
expressly included in the enumeration of the
circumstances that would negate liability in said
insurance policy cannot be considered by implication
to discharge the petitioner insurance company from
liability for, any injury, disability or loss suffered by
the insured. Thus, the failure of the petitioner
insurance company to include death resulting from
murder or assault among the prohibited risks leads
inevitably to the conclusion that it did not intend to
limit or exempt itself from liability for such death.
and regulate the recruitment and placement activities
of all agencies,” but also to “promulgate rules and
regulations to carry out the objectives and implement
the provisions” governing said activities.
Implicit in these powers is the award of appropriate
relief to the victims of the offenses committed by the
respondent agency or contractor, specially the refund
or reimbursement of such fees as may have been
fraudulently or otherwise illegally collected, or such
money, goods or services imposed and accepted in
excess of what is licitly prescribed. It would be illogical
and absurd to limit the sanction on an offending
recruitment agency or contractor to suspension or
cancellation of its license, without the concomitant
obligation to repair the injury caused to its victims.
Though some of the cases were filed after the
expiration of the surety bond agreement between J&B
and Eastern Assurance, notice was given to J&B of
such anomalies even before said expiration. In this
connection, it may be stressed that the surety bond
provides that notice to the principal is notice to the
surety. Besides, it has been held that the contract of a
compensated surety like respondent Eastern
Assurance is to be interpreted liberally in the interest
of the promises and beneficiaries rather than strictly
in favor of the surety.

EASTERN ASSURANCE VS.

SECRETARY OF LABOR (1990)

FACTS:
J&B Manpower is an overseas employment
agency registered with the POEA and Eastern
Assurance was its surety beginning January 1985.
From 1983 to December 1985, J&B recruited 33
persons but none of them were ever deployed. These
33 persons sued J&B and the POEA as well as the
Secretary of Labor ruled in favor of the 33 workers
and ordered J&B to refund them (with Eastern
Assurance being solidarily liable). Eastern Assurance
assailed the ruling claiming that POEA and the
Secretary of Labor have no jurisdiction over non-
employees (since the 33 were never employed, in
short, no employer-employee relations).

ISSUE: Whether or not Eastern Assurance can be held

liable in the case at bar.

HELD:
Yes. But only for the period covering from
January 1985 when the surety took effect (as already
held by the Labor Secretary). The Secretary of Labor
was given power by Article 34 (Labor Code) and
Section 35 and 36 of EO 797 (POEA Rules) to “restrict

MARIA ANNY G. YANONG PAGE 4